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+PROSPECTUS SUMMARY AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, "WE," "US," "OUR," AND "VETRO, INC." REFERS TO VETRO, INC. THE FOLLOWING SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK. VETRO, INC. Vetro, Inc. was founded in the State of Nevada on August 15, 2012. We are a development stage company and intend to sell crepes in Czech Republic. We intend to use the net proceeds from this offering to develop our business operations (See "Description of Business" and "Use of Proceeds"). To implement our plan of operations we require a minimum of $40,000 for the next twelve months as described in our Plan of Operations. We expect our operations to begin to generate revenues during months10-12 after completion of this offering. However, there is no assurance that we will generate any revenue in the first 12 months after completion our offering or ever generate any revenue. Being a development stage company, we have very limited operating history. If we do not generate any revenue we may need a minimum of $10,000 of additional funding to pay for ongoing SEC filing requirements. We do not currently have any arrangements for additional financing. Our principal executive offices are located at Jicinska, 2285/4, Prague, Czech Republic 13000. Our phone number is +420228880935. From inception until the date of this filing, we have had limited operating activities. Our financial statements from inception (August 15, 2012) through May 31, 2013, reports no revenues and a net loss of $4,241. Our independent registered public accounting firm has issued an audit opinion for Vetro, Inc. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. To date, we have developed our business plan and entered into a Lease Agreement with David Novak on April 17, 2013. As of the date of this prospectus, Tatiana Fumioka, our sole officer and director, owns 100% of the company's stocks. She will continue to own after completion of the offering sufficient shares to control the operations of the company. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. We do not anticipate earning revenues until we enter into commercial operation. Since we are presently in the development stage of our business, we can provide no assurance that we will successfully assemble, construct and sell any products or services related to our planned activities. THE OFFERING The Issuer: VETRO, INC. Securities Being Offered: 8,000,000 shares of common stock. Price Per Share: $0.01 Nature of the Offering: The offering is a self-underwritten, best-efforts offering with no minimum subscription requirement. Duration of the Offering: The shares will be offered for a period of two hundred and forty (240) days from the effective date of this prospectus. The offering shall terminate on the earlier of (i) when the offering period ends (240 days from the effective date of this prospectus), (ii) the date when the sale of all 8,000,000 shares is completed, (iii) when the Board of Directors decides that it is in the best interest of the Company to terminate the offering prior the completion of the sale of all 8,000,000 shares registered under the Registration Statement of which this Prospectus is part. We do not reserve the right to extend the offering beyond the 240-day period. Gross Proceeds: $80,000 Securities Issued and Outstanding: There are 8,000,000 shares of common stock issued and outstanding as of the date of this prospectus, held by our sole officer and director, Tatiana Fumioka. If we are successful at selling all the shares in this offering, we will have 16,000,000 shares issued and outstanding. Subscriptions: All subscriptions once accepted by us are irrevocable. Registration Costs; We estimate our total offering registration costs to be approximately $8,000. Risk Factors: See "Risk Factors" and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock. SUMMARY FINANCIAL INFORMATION The tables and information below are derived from our audited financial statements for the period from August 15, 2012 (Inception) to February 28, 2013 and our unaudited financial statements for the period from August 15, 2012 (Inception) to May 31, 2013. FINANCIAL SUMMARY February 28, 2013 ($) --------------------- (Audited) Cash and Deposits 8,136 Total Assets 8,136 Total Liabilities 317 Total Stockholder's Equity 7,819 STATEMENT OF OPERATIONS Accumulated From August 15, 2012 (Inception) to February 28, 2013 ($) --------------------- (Audited) Total Expenses 181 Net Loss for the Period (181) Net Loss per Share -- FINANCIAL SUMMARY May 31, 2013 ($) ---------------- (Unaudited) Cash and Deposits 4,076 Total Assets 4,076 Total Liabilities 317 Total Stockholder's Equity 3,759 STATEMENT OF OPERATIONS Accumulated From August 15, 2012 (Inception) to May 31, 2013 ($) ---------------- (Unaudited) Total Expenses 4,241 Net Loss for the Period (4,241) Net Loss per Share --
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diff --git a/parsed_sections/prospectus_summary/2013/CBKM_consumers_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CBKM_consumers_prospectus_summary.txt
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+contained elsewhere in this prospectus. Because this is only a summary, it does not contain all of the information that you should consider before deciding whether to purchase shares in the stock offering. You should carefully read this entire prospectus, including the information contained in the sections entitled "Risk Factors" and "The Rights Offering," our audited consolidated financial statements and the accompanying notes for the year ended June 30, 2012, and our unaudited consolidated financial statements for the quarter ended December 31, 2012, both of which are incorporated into this prospectus by reference, in their entirety before you decide to exercise your subscription rights. The Company Known at the time as Minerva National Bank, Consumers National Bank was originally chartered on August 30, 1965. Consumers is a full service financial institution engaged in commercial and retail banking through twelve full service locations and 13 ATM s throughout Stark, Carroll and Columbiana counties in northeast Ohio. Consumers Bancorp, Inc. is a bank holding company that was formed in 1995 to acquire all the issued and outstanding capital stock of Consumers National Bank. Consumers is a bank holding company under the Bank Holding Company Act of 1956, as amended, and is a registered bank holding company, incorporated under the laws of the State of Ohio. Its activities have been limited primarily to holding the common shares of the Bank. Our common shares are traded on the over-the-counter market under the trading symbol "CBKM." As of December 31, 2012, we had total assets of $344.6 million, total gross loans of $205.7 million, total deposits of $292.2 million and total shareholders' equity of $29.1 million. At December 31, 2012, our tier 1 leverage capital ratio was 7.30%, tier 1 risk-based capital ratio was 11.41% and total risk-based capital ratio was 13.39%. For the sixth months ended December 31, 2012, our return on average assets was 0.79% and our return on average equity was 9.45%. The Company is focused on growing business relationships and building core deposits, profitable loans and non-interest income. We believe that we have built a solid franchise that meets the financial needs of our clients and communities by providing an array of personalized products and services delivered by seasoned banking professionals with decisions made at the local level. We strive to be the leading community bank in each of our markets. We believe that our core lending and deposit business segments have performed well in a very challenging economic environment that began in 2008. For the five fiscal years ending June 30, 2012, our net charge-offs averaged only 0.16% of average loans. For the six months ended December 31, 2012, our annualized net charge-offs were only 0.05% of average loans. As of December 31, 2012, we had non-performing assets of $1.73 million which represented 0.50% of total assets. At that date, we had no other real estate owned. Management believes that the Company is well positioned to build on its core performance to continue to grow profitably. Additional employees and infrastructure are needed to manage the increased customer relationships that come with growth. Plans have begun to replace the Minerva Corporate Headquarters and branch with a new facility by spring of 2015. The new facility will provide a much improved customer experience in the branch, upgraded staff work spaces and basic amenities, operating efficiencies and increased capacity that will allow us to meet future staffing needs. We are a community-oriented financial institution that offers a wide-range of commercial and consumer loan and deposit products, as well as mortgage, financial planning and investment services to individuals, farmers and small and medium sized businesses in our markets. We seek to be the provider of choice for financial solutions to customers who value exceptional personalized service, local decision making, and modern banking technology. Our business involves attracting deposits from local businesses and individual customers and using such deposits to originate commercial, agricultural, mortgage, and consumer loans in Stark, Columbiana, Carroll and contiguous counties in Ohio. We also invest in securities consisting primarily of obligations of U.S. government sponsored entities, municipal obligations and mortgage-backed securities issued by Fannie Mae, Freddie Mac and Ginnie Mae. Consumers is supervised by the Board of Governors of the Federal Reserve System and Consumers National Bank is subject to supervision, regulation and periodic examination by the Office of the Comptroller of the Currency. Our executive offices are located at 614 East Lincoln Way, Minerva, Ohio and our telephone number is (330) 868-7701. Our internet address is www.consumersbank.com. The information contained on our website should not be considered part of this prospectus, and the reference to our website does not constitute incorporation by reference of the information contained on the website. Additional information about us and our subsidiaries is included in documents incorporated by reference in this prospectus. See "Where You Can Find More Information" beginning on page 26 of this prospectus. Our Management Team Our executive management team consists of seven seasoned banking professionals with an average of 25 years of experience each in the financial services industry. All seven members of our executive management team have worked in northeast Ohio for the majority of their respective careers. Our executive officers experience and local market knowledge have been instrumental in managing through challenging economic times and in positioning the Company to take advantage of future opportunities. To ensure management continuity well into the future, we have developed a leadership program for current executives and future leaders. The executive management team of Consumers consists of: Executive Title Years in Financial Services Ralph J. Lober, II President & CEO 22 Phillip M. Suarez Executive Vice President, Senior Loan Officer 41 Renee K. Wood Executive Vice President, Chief Financial Officer 20 Randy L. Gilroy Senior Vice President, Chief Credit Officer 32 Bryan D. Walters Senior Vice President, Chief Risk Officer 21 Derek G. Williams Senior Vice President, Retail Operations and Sales 34 Kimberly K. Chuckalovchak Vice President, Information Technology Manager 7 CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered(3); Proposed Maximum Aggregate Offering Price(2) Amount of Registration Fee Subscription Rights, each to purchase one share of our Common Stock, without par value (1) (1) Shares of Common Stock, without par value, underlying the Subscription Rights Total $10,000,000 $1,364.00 (1)Pursuant to Rule 457(o) under the Securities Act of 1933, as amended, the registration fee is calculated based upon the maximum aggregate offering price of all securities listed (determined as provided below). Pursuant to Rule 457(o), the table omits certain information. (2)Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(o) of the Securities Act. (3)The registrant is registering hereunder an indeterminate number or amount of subscription units and common stock. In no event will the aggregate maximum offering price of all securities issued pursuant to this registration statement exceed $10,000,000. The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission acting pursuant to said Section 8(a), may determine. QUESTIONS AND ANSWERS RELATING TO THE STOCK OFFERING The following are examples of what we anticipate will be common questions about the stock offering. The answers are based on selected information included elsewhere in this prospectus. The following questions and answers do not contain all of the information that may be important to you and may not address all of the questions that you may have about the stock offering. This prospectus contains more detailed descriptions of the terms and conditions of the stock offering and provides additional information about us and our business, including potential risks related to the stock offering, Consumers common shares and our business. What is the rights offering? We are distributing to holders of shares of our common stock as of 5:00 p.m., Eastern Time, on March 26, 2013, which is the record date for the rights offering, at no charge, non–transferable subscription rights to purchase shares of our common stock. You will receive one subscription right for each share of common stock you owned as of 5:00 p.m., Eastern Time, on March 26, 2013. Each subscription right entitles the holder to a basic subscription privilege and an over–subscription privilege, which are described below. The common shares to be issued in the rights offering, like our existing shares of common stock, will be traded on the OTC Markets under the symbol "CBKM." Why are we conducting the stock offering? We are engaging in the stock offering to raise equity capital to further strengthen Consumers National Bank s capital position, provide additional capital to Consumers for general operating purposes and to enable us to be well-positioned for future growth. Our capital management function is a regular process that consists of providing capital both for our current financial position and our anticipated future capital needs. Over the past few years we have experienced steady deposit growth and we believe that increased economic activity in our region, particularly in the energy sector, will lead to additional growth opportunities. The equity capital we raise in this stock offering will be used to enhance Consumers National Bank s overall capital position and for general corporate purposes, which may include, among others, pursuing strategic opportunities that may be presented to us from time to time. Our board of directors considered several alternative capital raising methods and has chosen to raise capital through a rights offering, in part to give our shareholders the opportunity to limit ownership dilution by buying additional shares of common stock. We believe that the stock offering will strengthen our financial condition by generating additional cash and increasing our capital position; however, our board of directors is making no recommendation regarding your exercise of the subscription rights. We cannot assure you that we will not need to seek additional financing or engage in additional capital offerings in the future. What is the basic subscription privilege? The basic subscription privilege of each subscription right gives our shareholders the opportunity to purchase 0.3173 shares of our common stock at a subscription price of $15.25 per share; however, fractional common shares resulting from the exercise of the subscription right will be eliminated by rounding down to the nearest whole share. We have granted to you, as a shareholder of record as of 5:00 p.m., Eastern Time, on the record date, one subscription right for each share of our common stock you owned at that time. For example, if you owned 100 shares of our common stock as of 5:00 p.m., Eastern Time, on the record date, you would have received 100 subscription rights and would have the right to purchase 31 shares of common stock for $15.25 per share subject to certain limitations and subject to allotment. You may exercise all or a portion of your basic subscription privilege or you may choose not to exercise any subscription rights at all. However, if you exercise less than your full basic subscription privilege, you will not be entitled to purchase any additional shares by using your over–subscription privilege. If you hold a Consumers stock certificate, the number of rights you may exercise pursuant to your basic subscription privilege is indicated on the enclosed rights certificate. If you hold your shares in the name of a custodian bank, broker, dealer or other nominee, you will not receive a rights certificate. Instead, the Depository Trust Company (DTC) will issue one subscription right to the nominee record holder for each share of our common stock that you own at the record date. If you are not contacted by your custodian bank, broker, dealer or other nominee, you should contact your nominee as soon as possible. What is the over–subscription privilege? In the event that you purchase all of the shares of our common stock available to you pursuant to your basic subscription privilege, you may also choose to purchase a portion of any shares of our common stock that are not purchased by our other shareholders through the exercise of their basic subscription privileges. You should indicate on your rights certificate how many additional shares you would like to purchase pursuant to your over–subscription privilege. If sufficient shares of common stock are available, we will seek to honor your over–subscription request in full. If, however, over–subscription requests exceed the number of shares of common stock available to be purchased pursuant to the over–subscription privilege, we will allocate the available shares of common stock among shareholders who over–subscribed by multiplying the number of shares requested by each shareholder through the exercise of their over–subscription privileges by a fraction that equals (i) the number of shares available to be issued through over–subscription privileges divided by (ii) the total number of shares requested by all subscribers through the exercise of their over–subscription privileges. We will not issue fractional shares through the exercise of over–subscription privileges. In order to properly exercise your over–subscription privilege, you must deliver the subscription payment related to your over–subscription privilege at the time you deliver payment related to your basic subscription privilege. Because we will not know the actual number of unsubscribed shares prior to the expiration of the rights offering, if you wish to maximize the number of shares you purchase pursuant to your over–subscription privilege, you will need to deliver payment in an amount equal to the aggregate subscription price for the maximum number of shares of our common stock that may be available to you. For that calculation, you must assume that no other shareholder, other than you, will subscribe for any shares of our common stock pursuant to their basic subscription privilege. See "The Rights Offering–The Subscription Rights–Over–Subscription Privilege." Am I required to exercise all of the subscription rights I receive in the rights offering? No. You may exercise any number of your subscription rights, or you may choose not to exercise any subscription rights. If you do not exercise any subscription rights, the number of shares of our common stock you own will not change. However, if you choose not to exercise your subscription rights or you exercise less than all of your subscription rights and other shareholders fully exercise their subscription rights or exercise a greater proportion of their subscription rights than you exercise, the percentage of our common shares owned by these other shareholders will increase relative to your ownership percentage, and your voting and other rights in the Company will likewise be diluted. In addition, if you do not exercise your basic subscription privilege in full, you will not be entitled to participate in the over–subscription privilege. Our Markets Headquartered in Minerva, we operate in the northeastern Ohio counties of Stark, Carroll and Columbiana. These counties are located in and around the region known as the Utica Shale Formation. According to the Ohio Oil & Gas Association (OOGA), from 2011 to 2015, oil and gas producers are projected to spend over $34 billion in exploration and development, midstream, royalty and lease expenditures in the Utica. Over that same timeframe, OOGA estimates the creation of over 200,000 jobs with more than $12 billion of annual salary and personal income. Although OOGA s projections are based on drilling results to date, there have been a number of significant investments including: Chesapeake Energy - Over $2 billion for development of the Utica Shale in 2012; this is in addition to the more than $1 billion it paid to Ohio landowners in the form of leasing and royalty payments, according to the Cleveland Plain Dealer; Vallourec – Announced the successful production of its first pipes at its new US state-of-the-art mill in Youngstown, Ohio after investing $350 million, according to Reuters; and M3 Midstream LLC – Over $1 billion for the first of several large natural gas processing plants in eastern Ohio scheduled to open in May 2013, according to the Cleveland Plain Dealer. Although we do not specifically lend to energy exploration concerns, the development and production of natural resources in our markets has caused a significant increase in economic development which, both directly and indirectly, is contributing to our increased growth and profitability. At the same time we are enjoying the positive effect of the Utica shale, we have been strategically expanding our access to more populous areas through the opening of offices in Hartville and Canton, Ohio. We believe that the demographic profiles of these areas are complementary to our existing markets and provide our business with geographic diversification. Through these new offices we are able to capitalize on our staff s market knowledge and have gained access to additional small business and agricultural customers. Situated in close proximity to Canton, Akron, Cleveland, Youngstown, and Pittsburgh, we believe that the markets we serve will provide meaningful growth opportunities for us. According to the Department of Labor, compared to data from the previous year, as of February 2013, all of our markets experienced meaningful job growth. The unemployment rates in each of our counties had a double-digit percentage decline year-over-year, compared to a 7.2% decline in the national unemployment rate. In 2012, the State of Ohio added more jobs than all other states except Texas, California, and New York. Competitive Strengths We believe that the following business strengths have been instrumental to the success of our core operations and will enable us to continue profitable growth and to maximize value to our shareholders, while remaining fundamentally sound. Community Banking Philosophy. As the leading community bank in our region, we believe the key to our franchise value is our dedication to making a difference in the markets we serve. We provide our clients with local decision making and individualized service coupled with the products and services offered by our larger institutional competitors. As our business lenders, officers, and company directors are based in or reside in the communities we serve, we are able to maintain a high-level of involvement in local organizations and establish a strong understanding of the banking needs of the respective communities. We believe that our customer-centric business philosophy and sales approach enables us to build long-term relationships with desirable customers, which enhances the quality and stability of our funding and lending operations. Our mission and philosophy has positioned us well in the communities across our market area and has enabled us to attract and maintain a very talented and experienced management team. Disciplined Credit Culture. We achieve our strong credit quality by adherence to sound underwriting and credit administration standards and by maintaining long-term customer relationships. The results of our focus on credit quality are evidenced by a ratio of non-performing assets to total assets of only 0.50% at December 31, 2012 and 0.65% at December 31, 2011, and a net charge-offs to average total loans ratio of 0.05% annualized for the six months ended December 31, 2012. Our ratio of allowance for loan losses to total loans was 1.15% at December 31, 2012 and 1.18% at December 31, 2011. While the challenging operating environment in 2008 and 2009 was disastrous for many banks across the country, our management team maintained excellent asset quality throughout. In part, this credit culture is the result of the level of stock ownership by our directors and executive officers. Strong Capital Position. We exceed the regulatory guidelines to be classified "well capitalized." Our capital position is strong and has consistently grown. At December 31, 2012, our tier 1 leverage capital ratio was 7.30%, our tier 1 risk-based capital ratio was 11.41% and our total risk-based capital ratio was 13.39%. We believe that our capital position enhances our ability to grow organically because it enables the Company to continue lending and to remain focused on our customers needs. We believe that completion of this stock offering will further enhance our capital strength and ability to grow. Technology. Throughout our history, we have been a leader in investing in the technology necessary to meet the developing demands of our commercial and retail customers. We utilize a strong core operating system that enables us to efficiently offer high-end deposit and loan products and have partnered with industry-leading internet banking, cash management, mobile banking, application-based banking, and telephone banking providers to offer a complete banking experience to all customers, regardless of their preference. We participate in a nationwide automated teller machine network and recently invested in fiber optics throughout our branch network. Profitable Growth Opportunities. We believe that we can attract new customers and expand our total loans and deposits within our existing market areas and through strategic branching and possible acquisition opportunities. The economic crisis and subsequent regulatory response will continue to create opportunities to attract new clients and in some cases, may become the catalyst for mergers and acquisitions. We will grow the loan portfolio, open new branches and consider new acquisitions only after rigorous due diligence and substantial quantitative analysis regarding the financial and capital impacts of such transactions. We believe that maintaining our financial discipline will generate long-term shareholder value. Financial Results for Nine Months Ending March 31, 2013, Six Months Ending December 31, 2012 and Fiscal Years 2012, 2011 and 2010 The following tables set forth certain information concerning the consolidated financial position and results of operations of Consumers for the periods indicated. This selected consolidated financial data should be read in conjunction with the consolidated financial statements incorporated into this prospectus by reference. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MAY 14, 2013 PROSPECTUS Consumers Bancorp, Inc. 655,668 shares of Common Stock, including up to 655,668 shares of Common Stock issuable upon the exercise of Subscription Rights at $15.25 per share We are distributing, at no charge to our shareholders, non-transferable subscription rights to purchase up to 655,668 shares of our common stock, without par value. In the rights offering, you will receive one subscription right for each share of common stock you held as of 5:00 p.m. Eastern Time, on March 26, 2013, the record date of the rights offering. Each subscription right will entitle you to purchase 0.3173 shares of our common stock at a subscription price of $15.25 per share, which we refer to as the basic subscription privilege, subject to certain limitations and subject to allotment. If you fully exercise your basic subscription privilege and other shareholders do not fully exercise their basic subscription privileges, you will be entitled to exercise an over-subscription privilege, subject to certain limitations and subject to allotment, to purchase a portion of the unsubscribed shares of our common stock at the same subscription price of $15.25 per share. To the extent you properly exercise your over-subscription privilege for an amount of shares that exceeds the number of the unsubscribed shares available to you, any excess subscription payments received by the subscription/escrow agent will be returned to you promptly, without interest, following the expiration of the stock offering. The subscription rights will expire if they are not exercised by 5:00 pm., Eastern Time, on [ ], 2013. We reserve the right to extend the expiration date one or more times, but in no event will we extend the rights offering beyond [ ], 2013. You should carefully consider whether to exercise your subscription rights before the expiration of the rights offering. All exercises of subscription rights are irrevocable. The subscription rights may not be sold, transferred or assigned. Our board of directors is not making a recommendation regarding your exercise of the subscription rights. You should carefully consider whether to exercise your subscription rights prior to the expiration of the rights offering. Investing in our common shares involves risks. See "Risk Factors" beginning on page 7 to read about factors you should consider before exercising your subscription rights. We may offer any of the shares of common stock that remain unsubscribed (after taking into account all over-subscription privileges exercised) at the expiration of the rights offering to the public at $15.25 per share on a best efforts basis by Boenning & Scattergood, Inc. (Boenning). Because the public offering is a best efforts offering, our selling agent is not required to purchase any common shares, but will use its best efforts to sell all the shares offered. The public offering will close as soon as practicable after the expiration date of the rights offering, but in no event later than [_____], 2013. The rights offering and the public offering may be referred to collectively as the stock offering. We may in our sole discretion cancel the rights offering and return the subscriber funds, in certain circumstances, no later than the earlier to occur of the public offering expiration date or the date on which we have accepted subscriptions for all shares available for purchase. Such circumstances are duscussed under the heading "Conditions, Withdrawal and Termination". If we cancel this offering, the subscription/escrow agent will return all subscription payments it has received for the cancelled rights offering without interest or penalty. We have engaged Registrar and Transfer Company to serve as the subscription/escrow agent. The subscription/escrow agent will hold in escrow the funds we receive from subscribers until we complete or cancel the rights offering. Our common shares are traded on the OTC Markets under the trading symbol "CBKM." The last reported sales price of our shares of common stock on [ ], 2013 was $[ ] per share. The shares of common stock issued in the rights offering will also be traded on the OTC Markets. The subscription rights will not be listed for trading on any stock exchange or market. As of the close of business on April 10, 2013 there were 2,066,399 shares of common stock issued and outstanding. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. These shares of common stock are not savings accounts, deposits, or other obligations of our bank subsidiary or any of our non-bank subsidiaries and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0000901842_blue_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0000901842_blue_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001092839_dune_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001092839_dune_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, including without limitation the Risk Factors section of this prospectus, and the documents incorporated by reference herein, including our consolidated financial statements and related notes, before making an investment decision. Some of the statements in this prospectus and the documents incorporated by reference herein constitute forward-looking statements. See Cautionary Notice Regarding Forward-Looking Statements for more information. Our Company Dune Energy, Inc., a Delaware corporation, is an independent energy company based in Houston, Texas. We were formed in 1998 and since May of 2004, we have been engaged in the exploration, development, acquisition and exploitation of crude oil and natural gas properties, with interests along the Louisiana/Texas Gulf Coast. Our properties cover over 82,000 gross acres across 19 producing oil and natural gas fields. Our total proved reserves as of December 31, 2012 were 90.1 Bcfe, consisting of 50.6 Bcf of natural gas and 6.6 Mmbbls of oil. The PV-10 of our proved reserves at year end was $260.6 million based on the average of the oil and natural gas sales prices on the first day of each of the twelve months during 2012, which was $91.33 per bbl of oil and $2.76 per mcf of natural gas. During 2012, we added 18.1 Bcfe through extensions and discoveries and produced 5.3 Bcfe. In addition, we experienced a net downward revision of 2.1 Bcfe. Our Business Strategy We intend to use our competitive strengths to increase reserves, production and cash flow in order to maximize value for our stockholders. The following are key elements of this strategy: Grow Through Exploitation, Development and Exploration of Our Properties. Our primary focus will continue to be the development and exploration efforts in our Gulf Coast properties. We believe that our properties and acreage position will allow us to grow organically through low-risk drilling in the near term, as this property set continues to present attractive opportunities to expand our reserve base through workovers and recompletions, field extensions, delineating deeper formations within existing fields and higher risk/higher reward exploratory drilling. In addition, we will constantly review, rationalize and high-grade our properties in order to optimize our existing asset base. Actively Manage the Risks and Rewards of Our Drilling Program. Our strategy is to increase our oil and natural gas reserves and production while keeping our finding and development costs and operating costs (on a per Mcfe basis) competitive with our industry peers. We expect to implement this strategy through drilling exploratory and development wells from our inventory of available prospects that we have evaluated for geologic and mechanical risk and future reserve or resource potential. Our drilling program will contain some higher risk/higher reserve potential opportunities as well as some lower risk/lower reserve potential opportunities in order to achieve a balanced program of reserve and production growth. Maintain and Utilize State of the Art Technological Expertise. We expect to maintain and utilize our technical and operations teams knowledge of salt-dome structures and multiple stacked producing zones common in the Gulf Coast to enhance our growth prospects and reserve potential. We employ technical advancements, including 3-D seismic data, pre-stack depth and reverse-time migration, to identify and exploit new opportunities in our asset base. We also employ the latest directional drilling, completion and stimulation technology in our wells to enhance recoverability and accelerate cash flows. Table of Contents Pursue Opportunistic Acquisitions of Underdeveloped Properties. We continually review opportunities to acquire producing properties, leasehold acreage and drilling prospects that are in core operating areas and require a minimum of initial upfront capital. We are also seeking to acquire operational control of properties that we believe have a solid proved reserve base coupled with significant exploitation and exploration potential. We will evaluate acquisition opportunities that we believe will further enhance our operations and reserves in a cost-effective manner. Summary Risk Factors We are subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows and prospects. You should carefully consider these risks, including all of the risks discussed in the section entitled Risk Factors, beginning on page 7 of this prospectus and discussed in the documents incorporated by reference herein, before investing in our common stock. Risks relating to our business include, among others: We have had operating losses and limited revenues to date. We have substantial capital requirements that, if not met, may hinder our operations. Recent economic conditions in the credit markets may adversely affect our financial condition. Natural gas and oil prices are highly volatile, and lower prices will negatively affect our financial results. Drilling for natural gas and oil is a speculative activity and involves numerous risks and substantial and uncertain costs that could adversely affect us. We depend on successful exploration, development and acquisitions to maintain reserves and revenue in the future. Our estimated reserves are based on many assumptions that may prove inaccurate. Any material inaccuracies in these reserve estimates or underlying assumptions will materially affect the quantities and present value of our reserves. A substantial percentage of our proved reserves consist of undeveloped reserves. Seismic studies do not guarantee that hydrocarbons are present or, if present, will produce in economic quantities. We may experience difficulty in achieving and managing future growth. Our business may suffer if we lose key personnel. We face strong competition from other natural gas and oil companies. We may not be able to keep pace with technological developments in our industry. Governmental regulation and liability for environmental matters may adversely affect our business, financial condition and results of operations. General Corporate Information Our principal offices are located at Two Shell Plaza, 777 Walker Street, Suite 2300, Houston, Texas 77022. We can be reached by phone at 713-229-6300 and our website address is www.duneenergy.com. Information on our website is not part of this prospectus. Table of Contents
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read the entire prospectus carefully together with our consolidated financial statements and the related notes appearing elsewhere in this prospectus. This prospectus contains forward-looking statements, which involve risks and uncertainties. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those discussed in the Risk Factors and other sections of this prospectus. Company Overview We are a leading cloud-based service provider of communications and information technology solutions to small and medium sized business ( SMB ) and enterprise customers nationwide. After several years of development, we began providing cloud-based communication services in 2005 and later introduced into our product portfolio a variety of cloud-based computing solutions. Today, we offer a full suite of cloud-based systems and services to customers nationwide, with more than 100,000 active licenses on our flagship product offering, our cloud-based business communications platform named OfficeSuite , which comprises a growing percentage of our overall revenue and the vast majority of our existing cloud-based revenue stream. We benefit from software development expertise, proprietary technology and a strong next-generation network infrastructure. This allows us to offer our customers more than just cloud-based services, but additionally products that include advanced, converged communications services and network access by leveraging our network infrastructure, on a cost-effective basis. For the three months ended March 31, 2013, over 82% of all new revenue installed during the period was provisioned on our next-generation IP network. We have provided cloud-based services in the Northeast and Mid-Atlantic United States since 2005 and offered cloud-based services nationwide since late 2009. Prior to 2009, our focus had been solely on markets across 10 states, including the major metropolitan markets of New York, Boston, Philadelphia, Baltimore and Washington, D.C. These markets remain important markets for us and we have the majority of our direct sales efforts focused on these markets. We distribute our products through quota-bearing sales representatives, including a direct sales force primarily based in the Northeast and Mid-Atlantic United States, sales agents nationwide, and by our expanded efforts in wholesale, web marketing, Value Added Resellers ( VARs ) and nationwide distributor channels. As of March 31, 2013, we provided our services to approximately 30,000 business customers nationwide. For the three months ended March 31, 2013 and the year ended December 31, 2012, approximately 90% and 89%, respectively, of our total revenue was generated from retail end users in a wide array of industries, including professional services, health care, education, manufacturing, real estate, retail, automotive, non-profit groups and others. For the same periods, approximately 10% and 11%, respectively, of our total revenue was generated from wholesale, carrier access and other sources. We have transitioned a significant percentage of our revenue base to T-1- and IP-based products and cloud-based communications services. For the three months ended March 31, 2013 and the year ended December 31, 2012, revenue from these accounts represented 78% and 76%, respectively, of our retail revenue with cloud-based communications services generating 18% and 16%, respectively, of retail revenue. From the first quarter of 2009 to the first quarter of 2013, cloud-based communications products and services have grown at approximately a 27% compound annual growth rate ( CAGR ). For the three months ended March 31, 2013 and the year ended December 31, 2012, we generated total revenues of $80.8 million and $340.9 million, respectively, and Adjusted EBITDA of $11.7 million and $60.2 million, respectively. For more information, see the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations Adjusted EBITDA Presentation. Our product portfolio provides bundled packages that include cloud computing and cloud-based voice services and network connectivity with a focus on addressing the productivity, flexibility, security and business continuity needs of end users operating within complex infrastructures. In addition, our growth initiatives focus Table of Contents TABLE OF CONTENTS Page SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 1 PROSPECTUS SUMMARY 3
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+This summary highlights information contained elsewhere, or incorporated by reference, in this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding to invest in our common stock. You should read this entire prospectus, including the section entitled Risk Factors and the risk factors incorporated by reference in this prospectus as described in that section, and our financial statements and the notes thereto and other information incorporated by reference in this prospectus from our other filings with the Securities and Exchange Commission (the SEC ). In this prospectus, unless the context indicates otherwise, the terms company, we, us, and our refer to Community Financial Shares, Inc., a Maryland corporation, and its subsidiaries. Company Information Overview Community Financial Shares, Inc. ( Community Financial Shares or the Company ) is a registered bank holding company. The operations of Community Financial Shares and its banking subsidiary, Community Bank Wheaton/Glen Ellyn (the Bank ), consist primarily of those financial activities common to the commercial banking industry, including but not limited to, demand, savings and time deposits, loans, mortgage loan origination for investors, cash management, electronic banking services, Internet banking services including bill payment, Community Investment Center services, and debit cards. Community Bank Wheaton/Glen Ellyn serves a diverse customer base including individuals, businesses, governmental units, and institutional customers located primarily in Wheaton and Glen Ellyn and surrounding communities in DuPage County, Illinois. Community Bank Wheaton/Glen Ellyn has banking offices in Glen Ellyn, and Wheaton, Illinois. All of the operating income of Community Financial Shares is attributable Community Bank-Wheaton/Glen Ellyn. Community Financial Shares was incorporated in the State of Delaware in July 2000 as part of an internal reorganization whereby the stockholders of Community Bank - Wheaton/Glen Ellyn exchanged all of their Community Bank - Wheaton/Glen Ellyn Bank stock for all of the issued and outstanding stock of Community Financial Shares (the Reorganization ). The Reorganization was completed in December 2000. As a result of the Reorganization the former stockholders of Community Bank - Wheaton/Glen Ellyn acquired 100% of Community Financial Shares stock and Community Financial Shares acquired (and still holds) 100% of Community Bank - Wheaton/Glen Ellyn s stock. The former Community Bank - Wheaton/Glen Ellyn stockholders received two shares of Community Financial Shares common stock for each share of Community Bank - Wheaton/Glen Ellyn common stock exchanged in the Reorganization. Community Financial Shares was formed for the purpose of providing financial flexibility as a holding company for Community Bank - Wheaton/Glen Ellyn. On June 25, 2013, Community Financial Shares completed its reincorporation into the State of Maryland (the Reincorporation ). The Reincorporation was approved by the stockholders of the Company at the annual meeting of stockholders held on June 13, 2013. The Reincorporation was completed by means of a merger of the Company with and into a new Maryland corporation that was organized as a wholly owned subsidiary of the Company for the purpose of effecting the Reincorporation, with the new Maryland corporation being the surviving corporation. As a result, the rights of the holders of the Company s capital securities are now governed by the Maryland General Corporation Law and the Maryland Articles of Incorporation and Bylaws of the Company. The Reincorporation did not result in any change in the business or principal facilities of the Company. Regulatory Matters As previously disclosed, the Bank entered into a Stipulation and Consent to the Issuance of a Consent Order with the Federal Deposit Insurance Corporation (the FDIC ) and the Illinois Department of Financial and Professional Regulation (the IDFPR ) on January 21, 2011, whereby the Bank consented to the issuance of a Consent Order (the Order ) by the FDIC and IDFPR, without admitting or denying that grounds exist for the FDIC and IDFPR to initiate an administrative proceeding against the Bank. Table of Contents CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Community Financial Shares from time to time includes forward-looking statements in its oral and written communications. Community Financial Shares may include forward-looking statements in filings with the Securities and Exchange Commission, such as this prospectus, in other written materials and in oral statements made by senior management to analysts, investors, representatives of the media and others. Community Financial Shares intends these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and Community Financial Shares is including this statement for purposes of these safe harbor provisions. Forward-looking statements can often be identified by the use of words like estimate, project, intend, anticipate, expect and similar expressions. These forward-looking statements include: Statements of Community Financial Shares goals, intentions and expectations; Statements regarding Community Financial Shares business plan and growth strategies; Statements regarding the asset quality of Community Financial Shares loan and investment portfolios; and Estimates of Community Financial Shares risks and future costs and benefits. Community Financial Shares ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of Community Financial Shares and its subsidiaries include, but are not limited to, the following: The strength of the United States economy in general and the strength of the local economies in which Community Financial Shares conducts its operations which may be less favorable than expected and may result in, among other things, an escalation in problem assets and foreclosures, a deterioration in the credit quality and value of Community Financial Shares assets, especially real estate, which, in turn would likely reduce our customers borrowing power and the value of assets and collateral associated with our existing loans; The effects of, and changes in, federal, state and local laws, regulations and policies affecting banking, securities, insurance and monetary and financial matters; The failure of assumptions underlying the establishment of our allowance for loan losses, that may prove to be materially incorrect or may not be borne out by subsequent events; The success and timing of our business strategies and our ability to effectively carry out our business plan; An inability to meet our liquidity needs; The effect of changes in accounting policies and practices, as may be adopted from time-to-time by bank regulatory agencies, the Securities and Exchange Commission, the Public Company Accounting Oversight Board, the Financial Accounting Standards Board or other accounting standards setters; The effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System, inflation, interest rate, market and monetary fluctuations; The risks of changes in interest rates on the level and composition of deposits, loan demand and the values of loan collateral, securities and interest sensitive assets and liabilities; Table of Contents The Order requires the Bank to achieve Tier 1 capital at least equal to 8% of total assets and total capital at least equal to 12% of risk-weighted assets within 120 days. At September 30, 2013, our Tier 1 and total capital ratios were 6.8% and 11.4%, compared to 6.7% and 11.4% at June 30, 2013, 6.8% and 11.8% at March 31, 2013 and 7.7% and 12.6% at December 31, 2012, respectively. We are actively working to comply with the Order s capital ratio requirements. The additional capital we have raised since June 30, 2013 in connection with the completion of the second closing of our December 2012 private placement offering and our September 2013 private placement offering, which are discussed in greater detail below, has brought the Bank closer to meeting the capital requirements set forth in the Order. However, our continued inability to meet the capital requirements of the Order may result in monetary penalties and/or additional regulatory actions and may require us to raise additional capital in the future. Our ability to raise additional capital is contingent on the current capital markets and on our financial performance. The Order also required the Bank to take the following actions: ensure that the Bank has competent management in place in all executive officer positions; increase the participation of the Bank s Board of Directors in the affairs of the Bank and in the approval of sound policies and objectives for the supervision of the Bank s activities; establish a compliance program to monitor the Bank s compliance with the Order; increase its allowance for loan losses to $4,728,000 after application of the funds necessary to effect the charge-off of certain adversely classified loans identified in the related Report of Examination of the FDIC and IDFPR (the ROE ); implement a program for the maintenance of an adequate allowance for loan and lease losses; adopt a written profit plan and a realistic, comprehensive budget for all categories of income and expense for calendar year 2011; charge off from its books and records any loan classified as loss in the ROE; adopt a written plan to reduce the Bank s risk position in each asset in excess of $500,000 which has been classified as substandard or doubtful in the ROE; cease extending additional credit to any borrower who is already obligated in any manner to the Bank on any extension of credit that has been charged off the books of the Bank or classified as loss in the ROE without the prior non-objection of the FDIC; not pay any dividends to the Company without prior regulatory approval; implement procedures for managing the Bank s sensitivity to interest rate risk; provide the Company with a copy of the Order; and submit quarterly progress reports to the FDIC and IDFPR regarding the Bank s compliance with the Order. We have been actively working to comply with the requirements of the Order, which will remain in effect until modified or terminated by the FDIC and IDFPR. In addition to raising capital as described above, our Board of Directors has continuously reviewed the qualifications of, and has restructured, our management team and has determined that our current management team has the authority and ability to: (i) comply with the requirements of the Order; (ii) operate the Bank in a safe and sound manner; (iii) comply with applicable laws, rules, and regulations; and (iv) restore all aspects of the Bank to a safe and sound condition, including capital adequacy, asset quality, management effectiveness, earnings, liquidity, and sensitivity to interest rate risk. The Board has also continued its participation in the affairs of the Bank, assuming full responsibility for the approval of sound policies and objectives and for the supervision of all the Bank s activities. In connection with its continued oversight, the Board meets no less than monthly to, at a minimum, review and approve: (i) reports of income and expenses; (ii) new, overdue, renewal, insider, charged off, and recovered loans; (iii) investment activity; (iv) the adoption or modification of operating policies; (v) individual committee reports; (vi) audit reports; (vii) internal control reviews including management responses; (viii) reconciliation of general ledger accounts; and (ix) compliance with the Order. We have also submitted a recapitalization plan to FDIC in accordance with the terms of the Order. Any material failure to comply with the provisions of the Order could result in enforcement actions by the FDIC and IDFPR. While the Company intends to take such actions as may be necessary to enable the Bank to comply with the requirements of the Order, there can be no assurance that the Bank will be able to comply fully with the provisions of the Order, or to do so within the timeframes required, that compliance with the Order will not be more time consuming or more expensive than anticipated, or that compliance with the Order will enable the Company and the Bank to resume profitable operations, or that efforts to comply with the Order will not have adverse effects on the operations and financial condition of the Company and the Bank. In addition to the Order, on January 14, 2011, the Company was notified by the Federal Reserve Bank of Chicago (the FRB ) that the overall condition of the Company and the Bank is less than satisfactory. As a result, the Company must now obtain prior written approval from the FRB prior to, among other things, the payment of any Table of Contents capital distribution, including stockholder dividends, or making any payments related to any outstanding trust preferred securities. The Company was also required, within thirty days of January 14, 2011, to downstream all remaining funds to the Bank with the exception of the Company s non-discretionary payments required to be made over the next twelve months. Additionally, the Company is required to comply with (i) the provisions of Section 32 of the Federal Deposit Insurance Act and Section 225.71 of the Rules and Regulations of the Board of Governors of the Federal Reserve System with respect to the appointment of any new Company directors or the hiring or change in position of any Company senior executive officer and (ii) the restrictions on making golden parachute payments set forth in Section 18(k) of the Federal Deposit Insurance Act. Recent Developments Financial Condition Like many financial institutions across the United States, our operations have been impacted by recent economic conditions. During 2008 and 2009, the economic crisis that was initially confined to residential real estate and subprime lending evolved into a global economic crisis that negatively impacted not only liquidity and credit quality but also economic indicators such as the labor market, the capital markets and real estate values. As a result of this significant downturn, we have been adversely affected by declines in the residential and commercial real estate market in our market area. Declining home prices, slowing economic conditions and increasing levels of delinquencies and foreclosures have negatively affected the credit performance of our residential real estate and commercial real estate loans, resulting in an increase in our level of nonperforming assets and loans past due 90 days or more and still accruing interest and charge-offs of problem loans. At the same time, competition among depository institutions in our markets for deposits and quality loans has increased significantly. As a result of the deterioration in economic conditions and the local real estate market, the Company experienced net losses of $4.6 million, $11.0 million and $2.5 million for the fiscal years ended December 31, 2010, 2011 and 2012, respectively, and experienced a net loss of $3.2 million for the nine months ended September 30, 2013 compared to a net loss of $1.6 million for the nine months ended September 30, 2012. During this time, the book value of the Company s common stock, on a fully converted basis, decreased from $14.26 per share at December 31, 2010 to $0.73 per share at September 30, 2013. The Company also experienced loan loss provisions totaling $8.3 million, $6.2 million and $1.6 million for the fiscal years ended December 31, 2010, 2011 and 2012, respectively, and experienced a loan loss provision of $1.4 million for the nine months ended September 30, 2013 compared to $1.1 million for the nine months ended September 30, 2012. Total nonperforming assets have decreased from $23.3 million at December 31, 2010 to $16.8 million at December 31, 2012 and have been further reduced to $8.4 million as of September 30, 2013. December 2012 Private Placement Offering As previously disclosed, in an effort to satisfy the increased capital requirements set forth in the Order, Community Financial Shares entered into a securities purchase agreement (the Securities Purchase Agreement ), dated as of November 13, 2012, with certain accredited investors and members of the Company s Board of Directors and executive management team pursuant to which, on December 21, 2012, the Company issued an aggregate of 4,315,300 shares of common stock at $1.00 per share, 133,411 shares of Series C convertible noncumulative perpetual preferred stock (the Series C Preferred Stock ) at $100.00 per share, 56,708 shares of Series D convertible noncumulative perpetual preferred stock (the Series D Preferred Stock ) at $100.00 per share and 6,728 shares of Series E convertible noncumulative perpetual preferred stock (the Series E Preferred Stock ) at $100.00 per share in a private placement offering, for gross proceeds of $24.0 million. The 133,411 shares of Series C Preferred Stock, the 56,708 shares of Series D Preferred Stock and the 6,728 shares of Series E Preferred Stock are convertible into 13,341,100, 5,670,800 and 672,800 shares of Company common stock, respectively. The effective price per share paid by investors was $1.00 per common share after taking into account the anti-dilution provisions of the Securities Purchase Agreement. Table of Contents Closings. The Securities Purchase Agreement provided that the Company would conduct two closings in connection with the private placement offering. The first closing, which occurred on December 21, 2012, resulted in $24.0 million in gross proceeds, or $21.5 million in net proceeds after deducting offering expenses of $2.5 million. The Company used the net proceeds from the first closing to (i) redeem the Company s $6.9 million of preferred stock previously issued to the U.S. Department of Treasury pursuant to the TARP Capital Purchase Program, (ii) repay the Company s indebtedness to a third party lender, (iii) enhance the capital of the Bank, as required by the terms of the Order previously issued by FDIC and IDFPR, and (iv) support the future operational growth of the Company In accordance with the terms of the Securities Purchase Agreement, after the first closing, the Company commenced a rights offering pursuant to which existing holders of the Company s common stock (not the investors participating in the first closing) were able to purchase up to an aggregate of 3,000,000 shares of Company common stock at a price of $1.00 per share. For more information on the rights offering, see Rights Offering below. Under the Securities Purchase Agreement, certain investors were permitted to purchase additional shares of Series C Preferred Stock and Series D Preferred Stock and Series E Preferred Stock, as applicable, in a subsequent second closing to the extent their ownership interests in the Company were diluted by the issuance of shares in the rights offering. On July 17, 2013, the Company consummated the second closing, pursuant to which it issued to the Selling Shareholders identified in this prospectus an aggregate of 1,192 shares of Series C Preferred Stock at $100.00 per share and 1,385 shares of Series D Preferred Stock at $100.00 per share for gross proceeds of $257,700. The 1,192 shares of Series C Preferred Stock and the 1,385 shares of Series D Preferred Stock that were issued in connection with the second closing are convertible into 119,200 and 138,500 shares of Company common stock, respectively. The second closing resulted in $257,700 in gross proceeds, or $226,850 in net proceeds after deducting offering expenses of $30,850. The Company used the net proceeds from the second closing to enhance the capital position of the Company. Rights Offering. As previously disclosed, and in accordance with the provisions of the Securities Purchase Agreement, on March 28, 2013, the Company sold 483,121 shares of common stock at a price of $1.00 per share in a nontransferable rights offering for gross proceeds of $483,121, or $424,800 in net proceeds after deducting offering expenses of $58,300. The Company used the net proceeds from the rights closing to enhance the capital position of the Company. Including the second closing and rights offering, gross proceeds of the private placement offering totaled $24.7 million, or $22.1 million in net proceeds after deducting aggregate offering expenses of $2.6 million. Board Representation. The Securities Purchase Agreement provided that the size of the Board of Directors of the Company must be fixed at nine members and that, subject to any required regulatory approvals, the Company would (i) appoint Donald H. Wilson as the Chairman of the Company s and the Bank s Board of Directors and (ii) appoint three individuals approved by three different nominating investors as members of the Company s and the Bank s Board of Directors and to certain committees thereof. Each of the nominating investors has the right to be represented on the Board of Directors of the Company and the Bank by one director of its choice for as long as it maintains at least a 2.5% ownership interest in the Company. Upon the receipt of all required regulatory approvals, Mr. Wilson was appointed as Chairman of the Board and Daniel Strauss, Christopher Hurst and Philip Timyan were appointed as directors of the Company and the Bank in accordance with the terms of the Securities Purchase Agreement. In anticipation of these appointments, and pursuant to the restriction in the Securities Purchase Agreement that the size of the Board of Directors may not exceed nine members, Donald H. Fischer retired as Chairman of the Board of Directors in January 2013 and William F. Behrmann, H. David Clayton, Joseph S. Morrissey and Robert F. Haeger resigned from the Board of Directors in February 2013. Use of Proceeds. The proceeds of the December 2012 private placement were used to (i) redeem the Company s $6.9 million of preferred stock previously issued to the U.S. Department of Treasury pursuant to the TARP Capital Purchase Program, (ii) repay the Company s indebtedness to a third party lender, (iii) enhance the capital of the Bank, as required by the terms of the Order previously issued by FDIC and IDFPR, and (iv) support the future operational growth of the Company. On November 13, 2012, the Company entered into a securities purchase agreement with the U.S. Department of Treasury (the TARP Securities Purchase Agreement ) pursuant to which, subject to the completion of the December 2012 private placement offering and the receipt of Federal Reserve Board approval, it agreed to repurchase the shares of preferred stock it previously issued pursuant to the TARP Capital Table of Contents Purchase Program for $3,293,550 plus an amount equal to 45% of the accrued and unpaid dividends on such preferred shares. The Company consummated the transactions contemplated by the TARP Securities Purchase Agreement on December 21, 2012. Stockholder Approval. In order to consummate the transactions contemplated by the Securities Purchase Agreement, the Company was required to obtain stockholder approval of (i) a proposal to amend the Company s Certificate of Incorporation to increase the authorized number of shares of the common stock of the Company to 75,000,000 shares from 5,000,000 shares and (ii) a proposal to amend the Company s Certificate of Incorporation to specify that each outstanding share of Company common stock is entitled to one vote on each matter submitted to a vote of the Company s stockholders so that each share of convertible voting preferred stock issued in the private placement could vote together with the shares of Company common stock on an as converted basis. Each of these proposals required the approval of the holders of a majority of the Company s outstanding shares of common stock. In order to save the expense associated with holding a special meeting of the Company s stockholders, the Board of Directors elected to obtain stockholder approval of the amendments described above by written consent pursuant to Section 228 of the Delaware General Corporation Law, rather than by calling a meeting of stockholders. Accordingly, on November 12, 2012, the Board of Directors voted to eliminate Article II, Section 13 of the Company s Bylaws, which provided that any action taken by stockholders of the Company without a meeting required the written consent of all of the stockholders entitled to vote with respect to the subject matter. The amendment of the Bylaws was effected without stockholder approval, which was not required under Delaware law. On December 12, 2012, the Company received the requisite number of stockholder consents needed to approve both amendments to the Company s Certificate of Incorporation. Non-Dilution Rights. The Securities Purchase Agreement provides that, until December 21, 2013, the Company may generally not issue any additional shares of common stock or other securities convertible into shares of common stock without the consent of the investors or the approval of two-thirds of the Company s Board of Directors. To the extent that the Company issues additional securities in accordance with this provision, investors have non-dilution rights under the Securities Purchase Agreement that will enable them, if they so choose, to purchase a number of shares of common stock (at the same price and on the same terms made available to purchasers of shares in the subsequent stock issuance) as would enable them to maintain the same economic ownership interest in the Company that they had immediately following the closing of the rights offering that was completed in March 2013. Registration Rights Agreement. In connection with the execution of the Securities Purchase Agreement, the Company and each of the investors also entered into a Registration Rights Agreement. The Registration Rights Agreement required the Company to file a registration statement with the Securities and Exchange Commission to register the resale of the shares of common stock issuable upon the conversion of the Series C Preferred Stock, Series D Preferred Stock and Series E Preferred Stock by investors participating in the private placement offering and also provides investors with demand and piggyback registration rights under certain circumstances. Preferred Stock Conversion Blockers. Each share of Series C Preferred Stock is convertible immediately, at the sole discretion of the holder, initially into 100 shares of Company common stock, provided, however, that a holder may not convert shares of the Series C Preferred Stock to the extent that such conversion would result in the holder or its affiliates beneficially owning more than 9.9% or 4.9%, as applicable, of the Company s outstanding common stock. If, pursuant to the Securities Purchase Agreement, the holder acquired either (i) solely shares of Series C Preferred Stock, or a combination of Series C Preferred Stock and common stock, in each case, that, together with Company voting securities acquired by its affiliates, constituted more than 4.9% of the Company s voting securities, or (ii) shares of both Series C Preferred Stock and Series D Preferred Stock, then the 9.9% conversion blocker will be applicable to such investor and its transferees. If, pursuant to the Securities Purchase Agreement, the holder acquired either (i) solely Series C Preferred Stock, or a combination of Series C Preferred Stock and common stock, in each case, that, together with Company voting securities acquired by its affiliates, constituted 4.9% or less of the Company s voting securities, or (ii) both Series C Preferred Stock and Series E Preferred Stock, then the 4.9% conversion blocker will be applicable to such investor and its transferees. Accordingly, the number of shares of common stock and percentage common stock reflected in the following table includes those shares of common stock issuable upon the conversion of shares of Series C Preferred Stock. Shares of Series D Preferred Stock and Series E Preferred Stock are convertible into shares of Series C Preferred Stock on a one-for-one basis, provided, however, that no such conversion results in any person, together with its affiliates, holding more than a 9.9% or 4.9% voting ownership interest, respectively, in the Company. Table of Contents September 2013 Private Placement Offering On September 30, 2013, the Company consummated its previously announced private placement offering, pursuant to which the Company issued 2,836,900 shares of common stock to accredited investors at a purchase price of $1.00 per share. In connection with the closing of the September 2013 private placement offering, the Company also issued an additional 350,200 shares of common stock at a purchase price of $1.00 per share and 7,334 shares of Series D convertible noncumulative perpetual preferred stock at a purchase price of $100.00 per share to existing stockholders of the Company. The additional shares of common stock and preferred stock were issued to satisfy the exercise of non-dilution rights afforded to stockholders under the Securities Purchase Agreement. Including these anti-dilution shares, the Company raised aggregate proceeds of $3,920,500 in connection with the completion of the private placement offering, $3.4 million in net proceeds after deducting offering expenses of $472,000. The Company used the net proceeds from the September 2013 private placement offering to invest $500,000 in the Bank and to further enhance the capital position of the Company. The issuance of shares in the September 2013 private placement offering was approved by at least two-thirds of the Company s Board of Directors as required under the Securities Purchase Agreement. After giving effect to the first and second closings of the December 2012 private placement offering, the March 2013 rights offering and the September 2013 private placement offering, the number of shares of outstanding Company common stock has increased from 1,245,267 to 10,781,988 since the execution of the Securities Purchase Agreement on November 13, 2012. Corporate Governance Matters Change in State of Incorporation. On June 25, 2013 the Company changed its state of incorporation from Delaware to Maryland. The reincorporation, which was effected to eliminate the Company s significant annual Delaware franchise tax expense, was approved by the stockholders of the Company at the annual meeting of stockholders held on June 13, 2013. The reincorporation was completed by means of a merger of Community Financial Shares, Inc., a Delaware corporation ( CFIS-Delaware ), with and into Community Financial Shares, Inc., a Maryland corporation ( CFIS-Maryland ), a wholly owned subsidiary of CFIS-Delaware incorporated for the purpose of effecting the reincorporation, with CFIS-Maryland being the surviving corporation. As a result of the merger, holders of CFIS-Delaware s capital securities are now holders of CFIS-Maryland s capital securities, and their rights as holders thereof are governed by the Maryland General Corporation Law and the Articles of Incorporation and Bylaws of CFIS-Maryland. For a description of the differences between the rights of holders of CFIS-Delaware s and CFIS-Maryland s capital securities, see Comparison of Stockholder Rights in the Company s Definitive Proxy Statement on Schedule 14A, filed with the Securities and Exchange Commission on April 29, 2013 and incorporated herein by reference. The reincorporation did not result in any change in the business or principal facilities of CFIS-Delaware. Appointment of New President and Chief Executive Officer. On August 15, 2013, the Board of Directors of the Company and the Bank appointed Donald H. Wilson as the President and Chief Executive Officer of the Company and the Bank effective as of August 15, 2013. As a result of the management restructuring, effective as of August 15, 2013, Scott W. Hamer, the former President and Chief Executive Officer of the Company and the Bank, was terminated as President and Chief Executive Officer. Mr. Wilson has served as the Chairman of the Company s and the Bank s Board of Directors since April 2013 and continues to serve in this capacity following his appointment as the President and Chief Executive Officer of the Company and the Bank. Table of Contents Terms of the Offering Shares Offered Up to 1,622,100 shares of common stock Selling Shareholders See Selling Shareholders for information regarding the Selling Shareholders. Use of Proceeds We will not receive any proceeds from the resale of the Shares by the Selling Shareholders. Plan of Distribution See Plan of Distribution for a discussion of the methods that may be used by the Selling Shareholders in their offer and sale of the Shares.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001159019_tribute_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001159019_tribute_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..3930a88f3f8c64145506db4e5fc3ce165e823fe0
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary may not contain all the information that you should consider before investing in our securities. You should carefully read the entire prospectus, including the information included in the Risk Factors section in this prospectus and in our Annual Report on Form 10-K for the year ended December 31, 2012, as well as our financial statements, notes to the financial statements and the other information incorporated by reference into this prospectus, as well as the exhibits to the registration statement of which this prospectus is a part, before making an investment decision. Tribute Pharmaceuticals Canada Inc. We are an emerging Canadian specialty pharmaceutical company with a primary focus on the acquisition, licensing, development and promotion of healthcare products in Canada. We target several therapeutic areas in Canada but have a particular interest in products for the treatment of pain, urology, dermatology and endocrinology/cardiology. We also sell Uracyst and NeoVisc internationally through a number of strategic partnerships. On December 1, 2011, we acquired 100% of the outstanding shares of Tribute Pharmaceuticals Canada Ltd. and Tribute Pharma Canada Inc., creating a North American specialty pharmaceutical company. As a result, we have gained access to a portfolio of existing products, as well as certain rights to the future development and distribution of therapeutic products within the Canadian marketplace. On October 1, 2012, Tribute amalgamated with its two wholly owned subsidiaries and became a single entity. Prior to this date, the financial statements of the Company were consolidated with its two wholly owned subsidiaries. Our current portfolio of assets includes nine products: NeoVisc , NeoVisc Single Dose, Uracyst , BladderChek , Bezalip SR, Soriatane , Cambia , Daraprim , and MycoVa . Each of these products has received regulatory approval in Canada, with the exception of MycoVa. We market our products in Canada through our own sales force and currently have licensing agreements for the distribution of select products in 27 countries, and continue to expand this footprint. Our focus on business development is twofold: utilizing in-licensing and out-licensing for immediate impact on our revenue stream, as well as product development for future growth and stability. Our management team has a strong track record in senior management positions at companies such as Wyeth, GSK, Syntex/Roche, Astra-Zeneca and Biovail. The team has extensive business development experience and has completed numerous prior product acquisitions, licensing and product re-formulation transactions. Our senior management has grown and managed companies with sales in excess of $300 million in the U.S. and over CDN$150 million in Canada. Our management team also has extensive experience in product launches in Canada. Corporate Information We were incorporated under the Business Corporations Act (Ontario) on November 14, 1994. We maintain two facilities including our head office located at 151 Steeles Ave. E., Milton, Ontario, Canada, L9T 1Y1 and our production facility at 544 Egerton Street, London, Ontario, Canada N5W 3Z8. Our telephone number is (519) 434-1540, facsimile number is (519) 434-4382 and e-mail address is support@tributepharma.com. We maintain a website at www.tributepharma.com. The information contained in, or that can be accessed through, the Company s website is not part of, and is not incorporated into this prospectus. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 2 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 TRIBUTE PHARMACEUTICALS CANADA INC. (Exact name of registrant as specified in its charter) Ontario 2834 N/A (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 151 Steeles Ave. E. Milton, Ontario Canada L9T 1Y1 (519) 434-1540 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Scott Langille Chief Financial Officer Tribute Pharmaceuticals Canada Inc. 151 Steeles Ave. E. Milton, Ontario Canada L9T 1Y1 (519) 434-1540 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copy to: Daniel A. Etna, Esq. David A. Pentlow, Esq. Herrick, Feinstein LLP 2 Park Avenue New York, New York 10016 (212) 592-1400 Eric R. Roblin, Esq. Fogler, Rubinoff LLP 77 King Street West Suite 3000 Toronto-Dominion Centre Toronto, Ontario M5K 1G8 (416) 864-9700 Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company (Do not check if a smaller reporting company) The Offering Common shares offered for sale by the selling shareholders 22,725,000 common shares(1) Common shares to be outstanding assuming all of the shares covered hereby are sold 62,335,042 common shares(2) Use of proceeds We will not receive any of the proceeds from the sale of the common shares offered in this prospectus. However, if all of the warrants were exercised for cash, we would receive gross proceeds of approximately $12,498,750.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001300662_proguard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001300662_proguard_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..9c3a2129e6b7e9b3b57e82482605d6cc053d5007
--- /dev/null
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@@ -0,0 +1,11875 @@
+PROSPECTUS SUMMARY
+
+About Us
+
+We are principally an on-line business to business retailer of brand name office products. Our direct-to-customer business model is designed to offer our business, government and educational customers a broad selection of office supplies at lower prices and improved efficiencies when compared to their existing suppliers. Our salespeople focus on personalized service and our growth strategy includes leveraging upon our existing customer relationships in order to grow internally by cross marketing our existing products across our customer base, and expanding our product offerings to include higher-margin services that produce a products that customers will order on a repetitive basis as opposed to a one time sale.
+
+Our principal executive offices are located at 3400 SW 26 Terrace, Suite A-8, Fort Lauderdale, FL 33312
+
+and our telephone number is (866) 780-6789. Our fiscal year end is December 31.
+
+SUMMARY OF THE OFFERING
+
+This prospectus covers the resale of a total of 51,284,561 shares of our common stock by the selling security holders, including 36,066,133 shares of our common stock which are presently outstanding and 15,218,428 shares of our common stock issuable upon the possible exercise of warrants with exercise prices ranging from $0.07 to $0.50 per share.
+
+We will not receive any proceeds from the resale of our shares by the selling security holders. To the extent the warrants are exercised on a cash basis, we will receive the exercise price of the warrants. We will pay all of the fees and expenses associated with registration of the shares covered by this prospectus.
+
+Common Stock:
+
+Outstanding Prior to this Offering:
+
+127,368,088 shares of common stock on December 31, 2012.
+
+ 
+ 
+
+Common Stock Reserved:
+
+An aggregate of 15,398,428 shares of our common stock, including 180,000 shares of our common stock at exercise price of $0.10 per share outstanding options under our 2010 Equity Compensation Plan and common stock purchase warrants to purchase an additional 15,218,428 shares of our common stock at exercise prices ranging from $0.07 to $0.50 per share. The resale of 15,218,428 shares issuable upon the exercise of the warrants are covered by this prospectus.
+
+Common Stock
+
+Outstanding After this Offering:
+
+142,586,516 shares of common stock, assuming the issuance of 15,218,428 shares of our common stock upon the exercise of common stock purchase warrants at exercise prices ranging from $0.07 to $0.50 per share, the resale of which is covered by this prospectus, but giving no effect to the possible issuance of shares upon the exercise of options under our 2010 Equity Compensation Plan.
+
+ 
+
+ 
+
+2
+
+ 
+
+SELECTED CONSOLIDATED FINANCIAL DATA
+
+The following summary of our selected consolidated unaudited financial information for nine months ended September 30, 2012 and 2011 and selected consolidated audited financial information for 2011 and 2010 which has been derived from, and should be read in conjunction with, our consolidated financial statements included elsewhere in this prospectus.
+
+Income Statement Data:
+
+ 
+ 
+
+Nine Months Ended September 30,
+
+ 
+ 
+
+Fiscal Year Ended December 31,
+
+ 
+
+ 
+ 
+
+2012
+
+ 
+ 
+
+2011
+
+ 
+ 
+
+2011
+
+ 
+ 
+
+2010
+
+ 
+
+ 
+ 
+
+(unaudited)
+
+ 
+ 
+
+(unaudited)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net sales
+
+ 
+$
+11,612,134
+ 
+ 
+$
+3,088,121
+ 
+ 
+$
+6,070,158
+ 
+ 
+$
+1,486,638
+ 
+
+Cost of sales
+
+ 
+ 
+10,297,523
+ 
+ 
+ 
+2,527,182
+ 
+ 
+ 
+5,104,595
+ 
+ 
+ 
+1,242,887
+ 
+
+Gross profit
+
+ 
+$
+1,314,611
+ 
+ 
+$
+560,939
+ 
+ 
+$
+965,563
+ 
+ 
+$
+243,751
+ 
+
+Gross profit margin
+
+ 
+ 
+11.3
+%
+ 
+ 
+18.2
+%
+ 
+ 
+16.0
+%
+ 
+ 
+16.4
+%
+
+Total operating expenses
+
+ 
+$
+1,604,626
+ 
+ 
+$
+665,028
+ 
+ 
+$
+1,383,783
+ 
+ 
+$
+380,832
+ 
+
+Total operating expenses as a percentage of net sales
+
+ 
+ 
+13.8
+%
+ 
+ 
+21.5
+%
+ 
+ 
+22.8
+%
+ 
+ 
+25.6
+%
+
+Net loss
+
+ 
+$
+(297,220
+)
+ 
+$
+(104,507
+)
+ 
+$
+(424,452
+)
+ 
+$
+(136,812
+)
+
+Balance Sheet Data:
+
+ 
+
+ 
+ 
+
+September 30,
+
+2012
+
+ 
+
+December 31,
+
+ 
+
+ 
+ 
+ 
+
+2011
+
+ 
+
+2010
+
+ 
+
+ 
+ 
+
+(unaudited)
+
+ 
+ 
+ 
+ 
+ 
+
+Working capital (deficit)
+
+ 
+$
+(520,202
+)
+ 
+$
+(379,436
+)
+ 
+$
+(8,273
+)
+
+Total current assets
+
+ 
+$
+588,926
+ 
+ 
+$
+736,434
+ 
+ 
+$
+179,432
+ 
+
+Total assets
+
+ 
+$
+1,405,407
+ 
+ 
+$
+1,679,156
+ 
+ 
+$
+180,785
+ 
+
+Total current liabilities
+
+ 
+$
+1,109,128
+ 
+ 
+$
+1,115,870
+ 
+ 
+$
+187,705
+ 
+
+Total liabilities
+
+ 
+$
+1,306,925
+ 
+ 
+$
+1,430,428
+ 
+ 
+$
+187,705
+ 
+
+RISK FACTORS
+
+An investment in our common stock involves a significant degree of risk. You should not invest in our common stock unless you can afford to lose your entire investment. You should consider carefully the following risk factors and other information in this prospectus before deciding to invest in our common stock.
+
+Risks Related to our Business
+
+WE HAVE A HISTORY OF LOSSES AND THERE ARE NO ASSURANCES THAT WE WILL REPORT PROFITABLE OPERATIONS IN FUTURE PERIODS.
+
+We reported net losses of $297,220, $424,452 and $136,812 for the first nine months of 2012, and fiscal 2011 and 2010, respectively. Although our net sales have increased significantly following our acquisitions of Hinson Office Supply and Superwarehouse, as a result of the different product mixes we now sell, our gross margins have declined. In addition, while our operating expenses as a percentage of net sales have decreased, in actual dollars our operating expenses have increased as a result of the expansion of our company. We also expect that our operating expenses will continue to increase during the balance of 2012 and beyond as a result of professional fees and other costs we will incur as a public company in additional to incremental increases associated with the operations of these acquired businesses. While we expect that our net sales will continue to increase during the balance of 2012 as a result of the benefit of sales from Hinson Office Supply and Superwarehouse for the entire fiscal year, there are no assurances our revenues from these acquisitions will be at the same level or greater than the acquired company s historic, pre-acquisition revenues or that we will be able to increase our margins in the near future. As a result of the expected additional costs we will incur as a public company, and additional costs associated with pursuing acquisitions of additional companies, there are no assurances we will report profitable operations in future periods.
+
+ 
+
+ 
+
+3
+
+ 
+
+WE WILL INCUR INCREASED COSTS RELATED TO OUR PUBLIC COMPANY REPORTING OBLIGATIONS WHICH WILL INCREASE OUR OPERATING EXPENSES IN FUTURE PERIODS.
+
+The legal, accounting and other expenses related to reporting obligations under federal securities laws we incur have increased significantly following the reverse merger with Random Source which closed in May 2012 as described later in this prospectus. Additional SEC regulations have also substantially increased the accounting, legal, and other costs related to remaining an SEC reporting company. These additional costs have and will continue to increase our operating expenses in future periods and will adversely impact our net income in future periods.
+
+WE MAY NEED ADDITIONAL FINANCING WHICH WE MAY NOT BE ABLE TO OBTAIN ON ACCEPTABLE TERMS. IF WE CANNOT RAISE ADDITIONAL CAPITAL AS NEEDED, OUR ABILITY TO GROW OUR COMPANY COULD BE IN JEOPARDY.
+
+Capital is needed for the effective expansion of our business. Our future capital requirements, however, depend on a number of factors, including our ability to internally grow our revenues, manage our business and control our expenses. We believe our current working capital will be sufficient to fund our existing operating expenses for approximately the next 12 months, absent a significant growth in our operations. However, in order to fully implement our growth strategy, we will need to raise additional capital. We do not have any firm commitments to provide any additional capital. We anticipate that we will have certain difficulties raising capital and additional working capital may not be available to us upon terms acceptable to us, or at all. If we are subsequently unable to raise additional funds as needed, our ability to grow our company could be in jeopardy.
+
+THE ACQUISITION OF NEW BUSINESSES IS COSTLY AND THESE ACQUISITIONS MAY NOT ENHANCE OUR FINANCIAL CONDITION AND MAY BE DILUTIVE TO OUR SHAREHOLDERS.
+
+A significant element of our growth strategy is to acquire companies which complement our business. The process to undertake a potential acquisition can be time-consuming and costly. We expect to expend significant resources to undertake business, financial and legal due diligence on our potential acquisition targets and there is no guarantee that we will acquire the company after completing due diligence. The process of identifying and consummating an acquisition could result in the use of substantial amounts of cash and exposure to undisclosed or potential liabilities of acquired companies. In addition, even if we are successful in acquiring additional companies, there are no assurances that the operations of these businesses will enhance our future financial condition. To the extent that a business we acquire does not meet the performance criteria used to establish a purchase price, some or all of the goodwill related to that acquisition could be charged against our future earnings, if any. Further, because of our current working capital limitations, it is possible that we may seek to issue shares of our common stock as partial or full consideration in a possible future acquisition. As a result of the low trading price of our common stock, the issuance of shares of our common stock in an acquisition could create substantial dilution for our existing shareholders.
+
+OUR MANAGEMENT MAY BE UNABLE TO EFFECTIVELY INTEGRATE OUR ACQUISITIONS AND TO MANAGE OUR GROWTH AND WE MAY BE UNABLE TO FULLY REALIZE ANY ANTICIPATED BENEFITS OF THESE ACQUISITIONS.
+
+We made two acquisitions in 2011 and expect to seek to make additional acquisitions in 2013. We are subject to various risks associated with our growth strategy, including the risk that we will be unable to identify and recruit suitable acquisition candidates in the future or to integrate and manage the acquired companies. Acquired companies histories, the geographical location, business models and business cultures will be different from ours in many respects. Our management faces significant challenges in their efforts to integrate the business of the acquired companies or assets and to effectively manage our continued growth. Successful integration of these acquisitions are subject to a number of challenges, including:
+
+ 
+
+the diversion of management time and resources and the potential disruption of our ongoing business;
+
+ 
+
+difficulties in maintaining uniform standards, controls, procedures and policies;
+
+ 
+
+unexpected costs and time associated with upgrading both the internal accounting systems as well as educating each of their staff as to the proper methods of collecting and recording financial data;
+
+ 
+
+potential unknown liabilities associated with acquired businesses;
+
+ 
+
+the difficulty of retaining key alliances on attractive terms with partners and suppliers; and
+
+ 
+
+the difficulty of retaining and recruiting key personnel and maintaining employee morale.
+
+There can be no assurance that our efforts to integrate the operations of any acquired assets or companies will be successful, that we can manage our growth or that the anticipated benefits of these proposed acquisitions will be fully realized. In addition, there are no assurances that we will be able to identify and close any additional acquisitions.
+
+ 
+
+ 
+
+4
+
+ 
+
+IF WE ARE UNABLE TO ATTRACT AND RETAIN SUFFICIENT PERSONNEL, OUR ABILITY TO OPERATE AND GROW OUR COMPANY WILL BE IN JEOPARDY.
+
+We believe that there is, and will continue to be, competition for qualified personnel in our industry, and there is no assurance that we will be able to attract or retain the personnel necessary for the management and development of our business. Turnover can also create distractions as we search for replacement personnel, which may result in significant recruiting, relocation, training and other costs, and can cause operational inefficiencies as replacement personnel become familiar with our business and operations. The inability to attract or retain employees currently or in the future may have a material adverse effect on our business, financial condition and results of operations.
+
+OUR MANAGEMENT DOES NOT DEVOTE THEIR ENTIRE TIME AND ATTENTION TO OUR BUSINESS.
+
+Messrs. Kriegstein and Merrick, our Chief Executive Officer and Chief Financial Officer, are directors and/or officers of Computer Nerds International, Inc., a web-based business offering computer hardware, software, electronics and related goods. In addition to his commitments to Computer Nerds International, Inc., Mr. Merrick is also in private practice as an accountant. While the product offerings of Computer Nerds International, Inc., a company co-founded by Mr. Kriegstein, do not directly compete with us and its offices are located in close proximity to ours which reduces the potential time they are not on site at our offices, the time spent on its business by these individuals, or on their other professional commitments, could detract from their efforts on our behalf.
+
+TECHNOLOGICAL PROBLEMS MAY IMPACT OUR OPERATIONS AND ANY CAPACITY CONSTRAINTS OR SYSTEM DISRUPTIONS COULD HAVE A MATERIAL ADVERSE EFFECT.
+
+We rely heavily on technology to sell and deliver our office products. Our ability to attract and retain customers, compete and operate effectively depends in part on a reliable and easy to use technology infrastructure. Any disruption to the Internet or our technology infrastructure, including those affecting our websites and computer systems, may cause a decline in our customer satisfaction, impact our sales volumes or result in increased costs. Although we continue to invest in our technology, if we are unable to continually add software and hardware, effectively manage and upgrade our systems and network infrastructure, and develop effective system availability, disaster recovery plans and protection solutions, our business may be adversely affected which could negatively impact our results of operations in future periods.
+
+OUR BUSINESS MAY BE ADVERSELY AFFECTED BY THE ACTIONS OF AND RISKS ASSOCIATED WITH OUR THIRD-PARTY VENDORS.
+
+The products we sell are sourced from third-party vendors. We derive benefits from vendor allowances and promotional incentives which may not be offered in the future. We also cannot control the supply, design, function or cost of many of the products that we offer for sale and are dependent on the availability and pricing of key products, including paper, ink, toner, technology and printing equipment. Disruptions in the availability of raw materials used in the production of these products may also adversely affect our sales and result in customer dissatisfaction. In addition, merchandise quality issues could cause us to initiate voluntary or mandatory recalls for our proprietary branded products or other products we sell which may then damage our reputation. These and other issues affecting our vendors could adversely affect our business and financial performance.
+
+OUR MANAGEMENT HAS NO EXPERIENCE IN OPERATING A PUBLIC COMPANY.
+
+Our executive officers and directors had prior no experience in the management of a publicly traded company before the reverse merger with Random Source in May 2012. Our management team may not successfully or effectively manage our transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities laws. Their lack of experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage to us in that it is likely that an increasing amount of their time will be devoted to these activities which will result in less time being devoted to the management and growth of our company.
+
+ 
+
+ 
+
+5
+
+ 
+
+Risk related to our common stock
+
+PROVISIONS OF OUR ARTICLES OF INCORPORATION AND BYLAWS MAY DELAY OR PREVENT A TAKE-OVER WHICH MAY NOT BE IN THE BEST INTERESTS OF OUR SHAREHOLDERS.
+
+Provisions of our articles of incorporation and bylaws may be deemed to have anti-takeover effects, which include when and by whom special meetings of our shareholders may be called, and may delay, defer or prevent a takeover attempt. In addition, certain provisions of the Florida Business Corporations Act also may be deemed to have certain anti-takeover effects which include that control of shares acquired in excess of certain specified thresholds will not possess any voting rights unless these voting rights are approved by a majority of a corporation's disinterested shareholders. Further, our articles of incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock with such rights and preferences as may be determined from time to time by our board of directors in their sole discretion. Our board of directors may, without shareholder approval, issue series of preferred stock with dividends, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of our common stock.
+
+THE TRADABILITY OF OUR COMMON STOCK IS LIMITED UNDER THE PENNY STOCK REGULATIONS WHICH MAY CAUSE THE HOLDERS OF OUR COMMON STOCK DIFFICULTY SHOULD THEY WISH TO SELL THE SHARES.
+
+Because the quoted price of our common stock is less than $5.00 per share, our common stock is considered a penny stock, and trading in our common stock is subject to the requirements of Rule 15g-9 under the Securities Exchange Act of 1934. Under this rule, broker-dealers who recommend low-priced securities to persons other than established customers and accredited investors must satisfy special sales practice requirements. The broker-dealer must make an individualized written suitability determination for the purchaser and receive the purchaser s written consent prior to the transaction. SEC regulations also require additional disclosure in connection with any trades involving a penny stock, including the delivery, prior to any penny stock transaction, of a disclosure schedule explaining the penny stock market and its associated risks. These requirements severely limit the liquidity of securities in the secondary market because few broker or dealers are likely to undertake these compliance activities and this limited liquidity will make it more difficult for an investor to sell his shares of our common stock in the secondary market should the investor wish to liquidate the investment. In addition to the applicability of the penny stock rules, other risks associated with trading in penny stocks could also be price fluctuations and the lack of a liquid market.
+
+THE EXERCISE OF OUTSTANDING WARRANTS AND OPTIONS WILL BE DILUTIVE TO OUR EXISTING SHAREHOLDERS.
+
+At December 14, 2012 we had 127,368,088 shares of our common stock issued and outstanding and the following securities which are convertible or exercisable into shares of our common stock were outstanding:
+
+ 
+
+15,218,428 shares of our common stock issuable upon the exercise of common stock purchase warrants with exercise prices ranging from $0.07 to $0.50 per share; and
+
+ 
+
+180,000 shares of our common stock issuable upon exercise of outstanding options with an exercise price of $0.10 per share.
+
+The exercise of these warrants or options and the issuance of the additional shares will be dilutive to our shareholders and could adversely impact the market for our common stock.
+
+CERTAIN OF OUR OUTSTANDING WARRANTS CONTAIN CASHLESS EXERCISE PROVISIONS WHICH MEANS WE WILL NOT RECEIVE ANY CASH PROCEEDS UPON THEIR EXERCISE.
+
+At December 14, 2012 we have common stock warrants outstanding to purchase an aggregate of 821,428 shares of our common stock with an exercise price of $0.07 per share which are exercisable on a cashless basis. This means that the holders, rather than paying the exercise price in cash, may surrender a number of warrants equal to the exercise price of the warrants being exercised. It is possible that the warrant holders will use the cashless exercise feature which will deprive us of additional capital which might otherwise be obtained if the warrants did not contain a cashless feature.
+
+ 
+
+ 
+
+6
+
+ 
+
+A SIGNIFICANT PORTION OF OUR OUTSTANDING COMMON SHARES ARE RESTRICTED SECURITIES AND WE HAVE OUTSTANDING OPTIONS, WARRANTS TO PURCHASE APPROXIMATELY 11% OF OUR CURRENTLY OUTSTANDING COMMON STOCK.
+
+At December 14, 2012 we had 127,368,088 shares of common stock outstanding together with outstanding options and warrants to purchase an aggregate of 15,398,428 shares of common stock at exercise prices of between $0.07 and $0.50 per share. Approximately 98% our outstanding shares of common stock are "restricted securities" and we have included 36,066,133 of those shares, as well as 15,218,428 shares underlying outstanding warrants, in the registration statement of which this prospectus is a part. Future sales of restricted common stock under Rule 144 or otherwise could negatively impact the market price of our common stock. In addition, in the event of the exercise of the warrants and/or options, the number of our outstanding common stock will increase by approximately 11%, which will have a dilutive effect on our existing shareholders.
+
+IF THE SELLING SECURITY HOLDERS ALL ELECT TO SELL THEIR SHARES OF OUR COMMON STOCK AT THE SAME TIME, THE MARKET PRICE OF OUR SHARES MAY DECREASE.
+
+It is possible that the selling security holders will offer all of the shares for sale. Further, because it is possible that a significant number of shares could be sold at the same time hereunder, the sales, or the possibility thereof, may have a depressive effect on the market price of our common stock.
+
+CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
+
+This prospectus includes forward-looking statements that relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Words such as, but not limited to, believe, expect, anticipate, estimate, intend, plan, targets, likely, aim, will, would, could, and similar expressions or phrases identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and future events and financial trends that we believe may affect our financial condition, results of operation, business strategy and financial needs. Forward-looking statements include, but are not limited to, statements about our:
+
+ 
+
+ 
+
+our ability to report profitable operations in future periods,
+
+ 
+
+ 
+
+our ability to acquire additional companies and successfully integrate the acquired companies into our existing operational structure,
+
+ 
+
+ 
+
+our ability to effectively compete,
+
+ 
+
+ 
+
+possible need to raise additional capital,
+
+ 
+
+ 
+
+the lack of experience of our management in operating a public company,
+
+ 
+
+ 
+
+the lack of full time management and possible conflicts of interest with a related company, and
+
+ 
+
+ 
+
+the lack of a liquid public market for our common stock.
+
+You should read thoroughly this prospectus and the documents that we refer to herein with the understanding that our actual future results may be materially different from and/or worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements including those made in Risk Factors appearing elsewhere in this prospectus. Other sections of this prospectus include additional factors which could adversely impact our business and financial performance. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this prospectus, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business.
+
+MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
+
+Our common stock is quoted in the OTC Bulletin Board under the symbol PGRD. The reported high and low last sale prices for the common stock are shown below for the periods indicated. The quotations reflect inter-dealer prices, without retail mark-up, markdown or commission, and may not represent actual transactions.
+
+ 
+
+ 
+
+7
+
+ 
+
+ 
+ 
+
+High
+
+ 
+ 
+
+Low
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+2010
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+First quarter ended March 31, 2010
+
+ 
+$
+0.35
+ 
+ 
+$
+0.14
+ 
+
+Second quarter ended June 30, 2010
+
+ 
+$
+0.175
+ 
+ 
+$
+0.09
+ 
+
+Third quarter ended September 30, 2010
+
+ 
+$
+0.23
+ 
+ 
+$
+0.07
+ 
+
+Fourth quarter ended December 31, 2010
+
+ 
+$
+0.41
+ 
+ 
+$
+0.06
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+2011
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+First quarter ended March 31, 2011
+
+ 
+$
+0.18
+ 
+ 
+$
+0.05
+ 
+
+Second quarter ended June 30, 2011
+
+ 
+$
+0.20
+ 
+ 
+$
+0.10
+ 
+
+Third quarter ended September 30, 2011
+
+ 
+$
+0.15
+ 
+ 
+$
+0.08
+ 
+
+Fourth quarter ended December 31, 2011
+
+ 
+$
+0.08
+ 
+ 
+$
+0.04
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+2012
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+First quarter ended March 31, 2012
+
+ 
+$
+0.09
+ 
+ 
+$
+0.07
+ 
+
+Second quarter ended June 30, 2012 (1)
+
+ 
+$
+0.14
+ 
+ 
+$
+0.06
+ 
+
+Third quarter ended September 30, 2012
+
+ 
+$
+0.08
+ 
+ 
+$
+0.07
+ 
+
+(1) We acquired Random Source in the reverse merger on May 7, 2012.
+
+The last sale price of our common stock as reported on the OTC Bulletin Board on January 8, 2013 was $0.05 per share. As of January 8, 2013, there were approximately 82 record owners of our common stock.
+
+Dividend policy
+
+We have never paid cash dividends on our common stock. Payment of dividends will be within the sole discretion of our board of directors and will depend, among other factors, upon our earnings, capital requirements and our operating and financial condition. In addition, under Florida law, we may declare and pay dividends on our capital stock either out of our surplus, as defined in the relevant Florida statutes, or if there is no such surplus, out of our net profits for the year in which the dividend is declared and/or the preceding year. If, however, the capital of our company computed in accordance with the relevant Florida statutes, has been diminished by depreciation in the value of our property, or by losses, or otherwise, to an amount less than the aggregate amount of the capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets, we are prohibited from declaring and paying out of such net profits any dividends upon any shares of our capital stock until the deficiency in the amount of capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets shall have been repaired.
+
+Future sales under Rule 144
+
+At December 14, 2012 we had 125,768,088 outstanding shares of common stock which are restricted securities under Rule 144 of the Securities Act of 1933. We have included 36,066,133 of these shares in the registration statement of which this prospectus is a part. In general, under Rule 144, as currently in effect, a person, or person whose shares are aggregated, who is not our affiliate or has not been an affiliate during the prior three months and owns shares that were purchased from us, or any affiliate, at least six months previously, is entitled to make unlimited public resales of such shares provided there is current public information available at the time of the resales. A person, or persons whose shares are aggregated, who are affiliates of the issuer and own shares that were purchased from us, or any affiliate, at least six months previously is generally entitled to sell within any three month period, a number of shares of common stock that does not exceed 1% of the then outstanding shares of common stock, subject to manner of sale provisions, notice requirements and the availability of current public information about the issuer.
+
+The ability of our shareholders to rely upon Rule 144, however, is limited by our former status as a shell company. Prior to the reverse merger with Random Source in May 2012, we were considered a shell company under Federal securities laws. As such, our shareholders are not able to rely on Rule 144 for the resale of shares of our common stock until a period of 12 months has lapsed from the date Form 10 information was filed by us with the SEC reflecting our exit from shell status. This information was contained in a Current Report on Form 8-K filed on May 10, 2012. If less than 12 months has elapsed since we ceased being a shell company , then only registered securities can be sold pursuant to Rule 144. Lastly, any shares held by affiliates, including shares received in any registered offering, will be subject to the resale restrictions of Rule 144(i).
+
+Future sales of restricted common stock under Rule 144 or otherwise or of the shares which we are registering under this prospectus could negatively impact the market price of our common stock. We are unable to estimate the number of shares that may be sold in the future by our existing shareholders or the effect, if any, that sales of shares by our shareholders will have on the market price of our common stock prevailing from time to time.
+
+ 
+
+ 
+
+8
+
+ 
+
+CAPITALIZATION
+
+The following table sets forth our capitalization as of September 30, 2012. The table should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this prospectus.
+
+ 
+ 
+
+September 30, 2012
+
+ 
+
+ 
+ 
+
+(unaudited)
+
+ 
+
+Long term liabilities
+
+ 
+$
+197,797
+ 
+
+Preferred stock, $0.001 par value, 10,000,000 shares authorized, 0 shares outstanding
+
+ 
+ 
+0
+ 
+
+Common stock, $0.001 par value, 500,000,000 shares authorized, 127,368,088 shares outstanding
+
+ 
+ 
+127,368
+ 
+
+Additional paid-in capital
+
+ 
+ 
+1,239,656
+ 
+
+Accumulated deficit
+
+ 
+ 
+(1,268,542 
+)
+
+Total shareholders' equity
+
+ 
+$
+98,482
+ 
+
+Total capitalization
+
+ 
+$
+296,279
+ 
+
+USE OF PROCEEDS
+
+We will not receive any proceeds upon the sale of shares of common stock by the selling security holders. Any proceeds that we receive from the exercise of the outstanding warrants, if exercised on a cash basis, will be used by us for general working capital. The actual allocation of proceeds realized from the exercise of the warrants will depend upon the amount and timing of such exercises, our operating revenues and cash position at such time and our working capital requirements. There can be no assurances that any of the outstanding warrants will be exercised on a cash basis, if at all.
+
+MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL STATEMENTS
+
+AND RESULTS OF OPERATIONS
+
+The following discussion of our financial condition and results of operations for the three and nine months ended September 30, 2012 and 2011 and 2011 and 2010 and should be read in conjunction with the consolidated financial statements and the notes to those statements that are included elsewhere in this prospectus. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under the Risk Factors, Cautionary Notice Regarding Forward-Looking Statements and Business sections in this prospectus. We use words such as anticipate, estimate, plan, project, continuing, ongoing, expect, believe, intend, may, will, should, could, and similar expressions to identify forward-looking statements.
+
+Overview
+
+We are principally an on-line business to business (B2B) retailer of brand name office products. Our direct-to-customer business model is designed to offer our business, government and educational customers a broad selection of office supplies at lower prices and improved efficiencies when compared to their existing suppliers. Our salespeople focus on personalized service and our growth strategy includes leveraging upon our existing customer relationships in order to grow internally by cross marketing our existing products across our customer base.
+
+Our acquisition strategy is also key to our growth. During 2011 we closed the acquisitions of Hinson Office Supply and the assets of SWH Enterprises, Inc. and Super Warehouse Gov, LLC, which are now part of Superwarehouse. As a result of these acquisitions, our offerings span several areas. Our original business, Random Source, targets small to medium-sized business in the 60-mile area surrounding our Fort Lauderdale, Florida offices. Hinson Office Supply concentrates on government and educational sales to customers in the same 60-mile area. Recently, our government sales team has begun to generate inquiries from agencies outside the current target radius. Superwarehouse is an open-platform web-based businesses which primarily sells toner.
+
+We are engaged in a complete redesign of the back-end accounting and customer databases of Hinson Office Supply and Superwarehouse to mirror Random Sources which we expect to complete in the first quarter of 2013. Once the system integration is complete, it will permit us to complete an integration of the three businesses into one seamless organization permitting us to reduce redundant administrative and advertising costs. Our new open platform website which we also expect to launch in the first quarter of 2013 will also enable us to expand Superwarehouse s product offerings to a full line of general business products, including office supplies, furniture, janitorial and break room products long with the toner products.
+
+ 
+
+ 
+
+9
+
+ 
+
+These acquisitions, together with our organic growth, helped us to increase our net sales from $3.1 million for the nine months ended September 30, 2011 to $11.6 million for nine months ended September 30, 2012. Because we only reported revenues from these acquisitions for a portion of 2012, we expect our 2012 revenues to continue to increase substantially from 2011.
+
+Subject to the availability of additional capital, we also expect to seek to acquire additional complimentary companies in our space. We believe that there are several potential acquisition targets in our market which would be synergistic and broaden our overall competitiveness. However, as we do not have any agreements or understandings with any third parties regarding the terms and conditions of any future acquisitions, there are no assurances we will be successful in implementing this growth strategy.
+
+Results of operations
+
+Three and nine months ended September 30, 2012 as compared to the three and nine months ended September 30, 2011
+
+Our net sales increased 173% in the third quarter of 2012 as compared to the third quarter of 2011, and 276% for the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011. Our net sales include revenues from Hinson Office Supply beginning in March 2011 and revenues from Superwarehouse beginning in October 2011. Included in our net sales for the third quarter of 2012 and the nine months ended September 30, 2012 are revenues of approximately $510,000 and $1.7 million, respectively, attributable to Hinson Office Supply and revenues of $2.8 million and $8.6 million, respectively, attributable to Superwarehouse.
+
+Our revenues attributable to Hinson Office Supply are trending down approximately 35% from its historic revenues pre-acquisition due to budgetary constraints of its customers as well as the changing of the way Broward County Schools handle its bid awards. The School Board of Broward County, FL has elected to piggy back a state contract for education purchasing using state funds only which will result in a decrease of revenue to Hinson Office Supply, however, all other local funds can be used at the discretion of the schools by approved Broward County vendors. In addition, because Hinson Office Supply is not contractually obligated to sell products at a specific cost, we are able to raise the gross profit on the existing business. Unlike mentioned in the second quarter of 2012, we do not expect our revenues attributable to Hinson Office Supply to increase during the remainder of 2012, however once we are able to expand Superwarehouse s product offerings, we expect that our gross margins will increase in future periods.
+
+The net sales in 2012 attributable to Superwarehouse on an annualized basis are significantly less than its historic results. Initially, this negative revenue trend was directly attributable to the decline in its client base prior to our acquisition of the company. While the sellers had been in business for approximately 15 years, in the period leading up to our acquisition of the assets in October 2011, the sellers had lost access to their credit facility and the resulting lack of working capital adversely impacted the sellers abilities to ship orders to customers. We have begun rebuilding these historic customer relationships and the attrition in customers leveled off during the second quarter of 2012. However, the April 2012 change by Google in certain of its key algorithms has adversely impacted Superwarehouse s search engine optimization ranking which in turn impacts revenues as Superwarehouse as it is a web-based business. In the first quarter of 2013, following the expected completion of the redesign of the backend accounting and customer databases which are necessary to enable us to adequately process order volume and the launch of our new website, we expect to begin actively marketing to Superwarehouse s historic customer base, expand its product offerings and achieve a better search engine optimization ranking. We believe all of these steps will help us to return Superwarehouse s revenues to those more closely the level of its historic revenues. While we expect that Superwarehouse will continue to positively impact our revenues in future periods, there are no assurances, however, that we will ever be able to return Superwarehouse revenues to the historic levels.
+
+Our gross profit declined substantially in both the third quarter of 2012 and the nine months ended September 30, 2012 from the comparable periods in 2011. Our gross profit margin decreased to 11% of net sales in the third quarter of 2012 and the nine months then ended from 14% and 18%, respectively, from the comparable periods in 2011. The decline in our margins is attributable to the percentage of our total net sales which are attributable to Superwarehouse which historically have lower margins than revenues from our other sales.
+
+Our total operating expenses increased 68% and 141% for the third quarter of 2012 and the nine months ended September 30, 2012, respectively, from the comparable periods in 2011. Marketing, selling and advertising expenses, which includes search engine optimization charges and costs associated with our website, increased 250% in the third quarter of 2012 and 462% for the nine months ended September 30, 2012 from the comparable periods in 2011. These increases are primarily attributable to marketing, selling and advertising expenses incurred by Superwarehouse which we did not have a comparable expense in the 2011 period. We expect that marketing, selling and advertising expenses to increase during the remainder of fiscal 2012.
+
+ 
+
+ 
+
+10
+
+ 
+
+Compensation expense increased 79% for the third quarter of 2012 and 158% for the nine months ended September 30, 2012 from the comparable periods in 2011 primarily as a result of additional personnel added following the acquisitions of Hinson Office Supply and Superwarehouse. We expect that compensation expense will remain constant during the balance of 2012.
+
+Professional and consulting fees increased 7% in the third quarter of 2012 and 11% for the nine months ended September 30, 2012 from the comparable periods in 2011. The increases are attributable to costs associated with the reverse merger in May 2012 described elsewhere in this prospectus and increased legal and accounting expenses during the periods. We granted purchasers in various private offering registration rights and those shares are included in this prospectus. As a result, we expect an increase in our professional fees during the fourth quarter of 2012, although we are not able at this time to quantify the amount of this increase.
+
+General and administrative expense increased 13% and 111% for the third quarter of 2012 and the nine months ended September 30, 2012, respectively, from the comparable periods in 2011. These increases were primarily as a result of our increased operations following the acquisitions of Hinson Office Supply and Superwarehouse. We expect that our operating expenses will continue to increase in 2012 from 2011 as we incur operating expenses related to Superwarehouse for the entire 12 month period.
+
+2011
+
+Our net sales increased 308% in 2011 from 2010, which includes revenues from Hinson Office Supply beginning in March 2011 and revenues from Superwarehouse beginning in October 2011. Included in our net sales for 2011 are revenues of approximately $2.1 million attributable to Hinson Office Supply and revenues of approximately $2.2 million attributable to Superwarehouse.
+
+Our gross profit remained constant at 16% in 2011 and 2010. Our total operating expenses increased approximately 263% in 2011 from 2010 and includes increases in all areas of our operating expenses. The principal increases in total operating expenses were increases in compensation expense, professional and consulting fees and general and administrative expenses. Compensation expense increased 366% in 2011 from 2010 as a result of additional personnel added following the acquisitions of Hinson Office Supply and Superwarehouse. Professional and consulting fees increased 127% in 2011 from 2010. This increase includes one-time expenses associated with the acquisitions closed in 2011 as well as additional accounting and related fees related to the audit of our financial statements. In 2011 we also engaged a consultant to advise us in business development and related matters as well as an investment banking firm to assist us in raising capital and incurred one-time charges associated with those agreements. General and administrative expense increased 276% in 2011 from 2010 primarily as a result of our increased operations following the acquisitions of Hinson Office Supply and Superwarehouse.
+
+Liquidity and capital resources
+
+Liquidity is the ability of a company to generate sufficient cash to satisfy its needs for cash. At September 30, 2012 we had a working capital deficit of $520,202 as compared to a working capital deficit of $379,436 at December 31, 2011. While our current liabilities remained relatively constant at September 30, 2012 from December 31, 2011, our current assets declined 20% which is primarily attributable to a decrease in cash and prepaid expenses and other current assets offset by an increase in accounts receivable.
+
+Accounts receivable, net, increased 21% at September 30, 2012 compared to December 31, 2011 which is primarily attributable to our increased sales in 2012. Accounts payable and accrued liabilities decreased 15% at September 30, 2012 compared to December 31, 2011 which is attributable to other sources of financing such as the commercial loan agreement as discussed below. Accounts payable related party reflects amounts due Computer Nerds International, Inc. for products we purchase from this affiliate. The increase of 9% at September 30, 2012 from December 31, 2011 is attributable to increased sales during 2012.
+
+Loan payable at September 30, 2012 reflects amounts due under a commercial loan agreement. We used these funds for general working capital. Notes payable short term reflects the current portion of amounts we owe under the purchase notes issued in the acquisition of Hinson Office Supply and in connection with the reverse merger. Due to related parties at December 31, 2011 represented amounts we had borrowed from executive officers and directors which were repaid in the first quarter of 2012.
+
+ 
+
+ 
+
+11
+
+ 
+
+We do not have any commitments for capital expenditures in 2012. Other than available access under a commercial bank lending arrangement, we do not have any external sources of liquidity and will need to raise additional working capital during 2013. This additional capital will be necessary to support the growth of our current operations as well as to provide additional capital for future acquisitions. In June 2012 we raised $50,000 in gross proceeds through the sale of our securities in a private placement and subsequent to June 30, 2012 we raised an additional $50,000 in gross proceeds in this offering. We are using the net proceeds for working capital. The amount raised in this offering was less than expected, and in an effort to increase our working capital, in September 2012 we increased our borrowing base under a loan agreement with a commercial bank to $200,000. While we expect that our ability to raise capital through the sale of our securities will be enhanced as our revenues continue to grow, there are no assurances we are correct and we are not a party to any binding agreements for additional capital. We expect that any market for our common stock will take time to develop as information regarding our company is more widely available. The lack of a liquid market will likely adversely impact our ability to raise additional capital. If we are not able to raise capital as needed, our ability to implement our growth plans will be in jeopardy.
+
+Net cash used in operating activities for the nine months ended September 30, 2012 was $267,650 as compared to net cash provided by operating activities of $180,971 for the nine months ended September 30, 2011. In the 2012 period cash was used to fund a decrease in our working capital of approximately $141,000, our net loss of approximately $300,000 and add back of depreciation and amortization of approximately $260,000. Net cash provided by operating activities in 2011 was $352,516 as compared to net cash used in operating activities of $85,068 in 2010. In 2011 cash was provided as follows:
+
+ 
+
+ 
+
+non-cash deprecation of $138,770, and
+
+ 
+
+ 
+
+an increase in working capital of approximately $640,000, partially offset by a
+
+ 
+
+ 
+
+a net loss of approximately $424,000.
+
+In 2010 cash was used as follows:
+
+ 
+
+ 
+
+non-cash expenses of $14,628, and
+
+ 
+
+ 
+
+a decrease in working capital of approximately $13,000, together with
+
+ 
+
+ 
+
+a net loss of approximately $137,000.
+
+Net cash used in investing activities for the nine months ended September 30, 2012 was $70,360 as compared to $122,884 for the nine months ended September 30, 2011. In the 2012 period, cash used in investing activities included website development costs and in the 2011 period cash used in investing activities represented the Hinson Office Supply acquisition. Net cash used in investing activities in 2011 was $872,273 as compared to $0 in 2010. In 2011 cash used in investing activities included cash used in acquisitions and the purchase of assets associated with the Superwarehouse acquisitions.
+
+Net cash provided by financing activities for the nine months ended September 30, 2012 was $144,572 as compared to $632,930 for the nine months ended September 30, 2011. In the 2012 period we raised cash from the sale of our common stock and the issuance of a note payable which was offset by payments of notes payable, including to related parties for working capital advances previously made to us, and the repurchase of stock in both the reverse merger which closed in May 2012 and from our prior investment banking firm. In the 2011 period we principally raised cash from the sale of our securities which was offset by the repayment of working capital advances from related parties. Net cash provided by financing activities in 2011 was $755,515 as compared to $23,010 in 2010. In 2011 we principally raised cash from the sale of our securities which was offset by the repayment of notes receivable. In 2011 we principally raised cash from the sale of our securities and advances from related parties.
+
+Critical accounting policies
+
+The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses during the reported periods. The more critical accounting estimates include estimates related to the allowance for doubtful accounts and the valuation of warrants that are deemed to be not indexed to our common stock. We also have other key accounting policies, which involve the use of estimates, judgments and assumptions that are significant to understanding our results, which are described in Note 1 to our consolidated financial statements appearing elsewhere in this prospectus.
+
+ 
+
+ 
+
+12
+
+ 
+
+Recent accounting pronouncements
+
+The recent accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption.
+
+Off balance sheet arrangements
+
+As of the date of this prospectus, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term "off-balance sheet arrangement" generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with us is a party, under which we have any obligation arising under a guarantee contract, derivative instrument or variable interest or a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.
+
+Change of auditors
+
+On October 18, 2012, we dismissed Sherb & Co., LLP as our independent registered public accounting firm and engaged D Arelli Pruzansky, P.A. as our independent registered public accounting firm. Sherb & Co., LLP audited our financial statements for the periods ended December 31, 2011 and 2010. The dismissal of Sherb & Co., LLP was approved by our board of directors on October 18, 2012. Sherb & Co., LLP did not resign or decline to stand for re-election.
+
+Neither the report of Sherb & Co., LLP dated March 21, 2012 on our balance sheets as of December 31, 2011 and 2010 and the related statements of operations, shareholders equity (deficit), and cash flows for the years ended December 31, 2011 and 2010 nor the report of Sherb & Co., LLP dated March 21, 2011 on our balance sheets as of December 31, 2010 and 2009 and the related statements of operations, shareholders equity (deficit), and cash flows for the years ended December 31, 2010 and 2009 contained an adverse opinion or a disclaimer of opinion, nor were either such report qualified or modified as to uncertainty, audit scope, or accounting principles, except that both such reports raised substantial doubts on our ability to continue as a going concern.
+
+During our two most recent fiscal years and the subsequent interim period preceding our decision to dismiss Sherb & Co., LLP we had no disagreements with the firm on any matter of accounting principles or practices, financial statement disclosure, or auditing scope of procedure which disagreement if not resolved to the satisfaction of Sherb & Co., LLP would have caused it to make reference to the subject matter of the disagreement in connection with its report.
+
+During our two most recent fiscal years and the subsequent interim period prior to retaining D Arelli Pruzansky, P.A. (1) neither we nor anyone on our behalf consulted D Arelli Pruzansky, P.A. regarding (a) either the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on our financial statements or (b) any matter that was the subject of a disagreement or a reportable event as set forth in Item 304(a)(1)(iv) and (v), respectively, of Regulation S-K, and (2) D Arelli Pruzansky, P.A. did not provide us with a written report or oral advice that they concluded was an important factor considered by us in reaching a decision as to accounting, auditing or financial reporting issue.
+
+OUR BUSINESS
+
+We are principally an on-line business to business wholesaler of office products with a current product base concentrated in brand name office products. Our direct-to-customer business model is designed to offer our business, government and educational customers a broad selection of office supplies at lower prices and improved efficiencies when compared to their existing suppliers.
+
+We use our e-commerce websites and our catalog to showcase our wide selection of merchandise, including general office supplies, business machines and computers, office furniture and other business-related products.
+
+We believe that our competitive advantage is our ability to compete favorably based upon both price and efficiency as a result of our direct-to-customer operating format. We buy our inventory directly from wholesale distributors and, with the exception of some deliveries, drop ship that merchandise directly to customers. As a result, we can compete effectively on price because we do not have costs of carrying inventory either in a warehouse or on a sales floor. In addition to competitive pricing, our goal is to provide a total cost-effective platform to our customers. Our sales and customer service representatives work to develop broad customer relationships on the basis of which we seek to provide ecommerce infrastructure, sophisticated ordering systems and comprehensive product utilization reports designed to improve efficiencies and reduce operating costs.
+
+ 
+
+ 
+
+13
+
+ 
+
+As a result of our 2011 acquisitions, we currently have two distinct customer bases to which we provide either ink and toner or general office supplies including paper, break room and janitorial supplies and furniture. In an effort to provide a broader array of products and services to our clients in which we are seen as a one stop shop. During the first or second quarter of 2013, we anticipate cross marketing our ink and toner products to our general office supply purchasers and vice versa.
+
+Our customers traditionally purchase a number of products and services from a variety of vendors. In the second half of 2013 we anticipate expanding our offerings to include a variety of services such as automated electronic managed printing services, promotional printing and advertising services, and shredding services. We are, however, in the preliminary stages of planning the launch of these additional services and it is possible that we will choose not to proceed with one or more of them as we further develop our implementation plans.
+
+Recent acquisitions and our acquisition strategy
+
+A key component to our business strategy is growth through strategic acquisitions and we expect that our ability to grow our company will be accelerated by the acquisition of similar companies with positions in various geographic and product markets which we believe may be advantageous to us. Our internal research has identified a number of small, regional companies, many with strong relationships and reputations but without the critical mass, resources or financial market expertise to maximize on their potential or create an exit strategy for their owners. In pursuing this strategy, in 2011 we made two acquisitions:
+
+ Hinson Office Supply. On March 18, 2011, we acquired 100% of the stock of Lamfis, Inc. which does business as Hinson Office Supply, for a purchase price of $262,000. Hinson Office Supply was a 20 year old supplier of office products and supplies in South Florida. For the past 18 years it has been the largest office products board-approved vendor to the School Board of Broward County, Florida, which is the sixth largest school system in the United States, as well as an approved vendor for the Palm Beach County, Florida school system. As a board-approved vendor, individual schools are authorized by the School Board to purchase products from Hinson Office Supply. In an effort to retain continuity with its customer base, for the near future we are operating Hinson Office Supply as it was operated prior to the transaction. Over time, we expect to transition Hinson Office Supply s corporate accounts to Random Source, while retaining the school system business at Hinson Office Supply. This customer base requires early morning deliveries to accommodate the uniqueness of the school operations and Hinson Office Supply has built internal operations which efficiently fulfill this requirement.
+
+ Superwarehouse. On October 4, 2011 we acquired certain assets of both SWH Enterprises, Inc. and Superwarehouse Gov, LLC for an aggregate purchase price of $750,000. These assets, which we refer to as the Superwarehouse Assets, included customer lists, vendor lists and vendor contracts, intellectual property rights, and all other assets of these two entities excluding accounts receivable. Over the combined 20 years in business, both organizations focused on selling technology related products, with an emphasis on printers and toner, to both business customers and government agencies throughout the United States. As we did with Hinson Office Supply, we are initially operating the new businesses under our newly formed subsidiary Superwarehouse Business Products, Inc. separate from our other existing businesses. At this time the Superwarehouse companies do not offer our general business products such as office supplies, janitorial supplies and or break room supplies, however, it is our intention to add these additional product lines to its offerings during the first or second quarter of 2013 in an effort to expand sales following the acquisitions.
+
+We expect to complete the redesign of the backend accounting and customer databases of Hinson Office Supply and Superwarehouse to mirror Random Sources during 2013. Thereafter, during 2013 we expect to complete an integration of the three businesses into one seamless organization permitting us to reduce redundant administrative and advertising costs.
+
+It is our intent to continue to seek to acquire additional complimentary companies in our space. We believe that there are several potential acquisition targets in our market which would be synergistic and broaden our overall competitiveness. However, as we do not have any agreements or understandings with any third parties regarding the terms and conditions of any future acquisitions, there are no assurances we will be successful in implementing this growth strategy.
+
+ 
+
+ 
+
+14
+
+ 
+
+Office products industry
+
+The office products industry is comprised of three broad categories of merchandise: office supplies, office machines and computers, and office furniture. The retail office products industry is highly fragmented typified by stores that do not stock a full range of office products and use a central warehouse facility. Often these products are distributed through different and overlapping channels of distribution, including manufacturers, distributors, dealers, retailers and online catalog companies. Retail sales of office products in the United States are often made primarily through chains operating retail stores and regional or national office product dealers, while dealers purchase a significant portion of their merchandise from national or regional office supply distributors who in turn purchase merchandise from manufacturers. Dealers often employ a commissioned sales force that uses the distributor's catalog, showing products at retail list prices, for selection and price negotiate with the customer.
+
+In the past few years, high-volume office products retailers have emerged in many geographic markets of the United States targeting smaller businesses that traditionally purchased from dealers by offering significantly lower prices resulting primarily from direct, high-volume purchasing from manufacturers and warehouse retailing, thereby avoiding the distributor's mark-up and eliminating the need for a commissioned sales force and a central distribution facility. High-volume office products retailers typically offer substantial price savings to individuals and small businesses, which traditionally have had limited opportunities to buy at significant discounts off the retail list prices. Despite the growth in high-volume office products retailers, larger customers have been, and continue to be, serviced primarily by full service contract stationers. These stationers traditionally serve medium and large businesses through commissioned sales forces, purchased in large quantities primarily from manufacturers and offer competitive pricing and customized services to their customers.
+
+Merchandising and product strategy
+
+Our retail merchandising strategy offers a broad selection of approximately 36,000 items of brand-name office products at low prices. Our website and catalog offer a comprehensive selection of paper and paper products, filing supplies, computer hardware and software, calculators, copiers, facsimile and other business machines, office furniture, engineering supplies and virtually every other type of office supplies.
+
+We buy all of our merchandise directly from wholesale distributors. Other than our recent change in paper products delivery following our acquisition of Hinson Office Supply, products are then delivered from the distributor directly to the customer. Our program permits shipping directly to customers avoiding the costly and traditional cross-dock operations that typically use independent distributor s facilities to receive bulk deliveries from vendors to sort and deliver merchandise to a company's stores and warehouses. Because we ship the merchandise directly to the customer our company and customer both realize savings by eliminating multiple freight and handling charges and the need for a store or warehouse to receive and redistribute inventory.
+
+Marketing and sales
+
+Our marketing programs are designed to expand our customer base. Our business strategy is to enhance the sales and profitability of our existing websites and expand our contract stationer business by acquiring and maintaining customers primarily through our direct sales force.
+
+We provide three key services to our customers being Internet, telephone and facsimile ordering and delivery. Our customers nationwide can place orders through our website or telephone using toll-free telephone numbers through our order departments in south Florida. Orders received by the order departments are transmitted electronically to manufacturers and distributors for delivery plus a delivery fee or free delivery with a minimum order size. Orders are packaged, invoiced and shipped for next-day delivery direct from the distributor or manufacturer. Other services we provide that are designed to improve efficiencies and reduce costs include electronic re-ordering, stockless office procurement and comprehensive product utilization reports.
+
+No single customer accounts for more than 10% of our sales. We have no material long-term contracts or commitments with the wholesale distributor or any customer. We have not experienced any difficulty in obtaining desired quantities of merchandise for sale and do not foresee any such difficulty in the future. Should the need arise, we do not expect any difficulties in obtaining alternative suppliers at competitive pricing.
+
+We designed the system architecture for our Random Source website to be built with performance, security, reliability, and redundancy in mind. It is currently hosted in one of the top co-locations in the world, Terramark , which is also known as the NAP of the Americas, a Tier-IV, 750,000 square feet datacenter. Once data enters our servers, it is met with top-of-the-line, load balanced, redundant firewalls that automatically block potentially bad packets from intruding the system. The system is backed with a PostgreSQL database, which is generally recognized as a powerful open source database. Our data is also backed-up to separate servers to further prevent any data loss. We are currently designing a system for our Superwarehouse website and expect that system, which will have a similar set up for security and will be at a co-location with backup and redundancy, to be complete during the first quarter of 2013.
+
+ 
+
+ 
+
+15
+
+ 
+
+Employees
+
+At December 31, 2012 we had 18 full-time employees. There are no collective bargaining agreements covering any of our employees.
+
+Competition
+
+We operate in a highly competitive environment. Several high-volume office supply chains operate in the United States. Our competitors include Office Depot, Staples, Office Max as well as independent office supply companies and wholesale clubs, including Costco and BJ Wholesale, which carry office supplies. We compete with these chains and wholesale club chains in substantially all of our current and prospective markets. We believe we compete based on product price, selection, availability and service. We believe that in the future we will face increased competition from these chains as our company and these chains expand their operations. Most of the entities against which we compete, or may compete, are larger and have greater financial resources than our company. No assurance can be given that increased competition will not have an adverse effect on our company.
+
+Our offices
+
+Our principal executive offices are located in approximately 7,000 square feet of office and warehouse space which we lease under an agreement expiring in July 2014. Our annual rental for this facility ranges from $26,000 in the first year of the lease up to $28,000 in the final year of the term of the lease, plus a proportionate share of operating expenses of approximately $25,000 annually.
+
+We lease approximately 1,750 square feet in San Diego, California under a lease expiring in September 2013. Our annual rental for this facility, from which Superwarehouse is currently based, is approximately $11,600 plus a proportionate share of operating expenses.
+
+Our history
+
+We were formed under the laws of the State of Florida in June 2004. In July 2004, we acquired 100% of the shares of Proguard Protection Services, Inc., a Colorado corporation, for $100 pursuant to an oral agreement. Proguard Protection provided professional protection to clients through installation and monitoring of fire, intrusion and environmental security systems.
+
+In October 4, 2006, we sold all of the issued and outstanding common stock of Proguard Protection Services, Inc. to Corrections Systems International, Inc., a privately held Florida corporation which was a related party, for $250,000 under the terms of a Common Stock Purchase and Sale Agreement. Thereafter, we became a shell company as that term is defined under Federal securities laws.
+
+On May 7, 2012, we acquired Random Source in a reverse merger pursuant to the terms and conditions of the agreement of merger and plan of reorganization dated April 27, 2012. Upon closing of the transaction contemplated under the agreement, Random Source became a wholly-owned subsidiary of our company. In the transaction, in exchange for all of the issued and outstanding capital stock of Random Source we issued the holders of those shares 127,989,517 shares of our common stock, which, after giving effect to the stock repurchase described below, represented approximately 97.2% of our outstanding common stock, giving no effect to the shares of our common stock underlying the Exchange Warrants.
+
+At closing, we also issued the Random Source shareholders who were also warrant holders common stock purchase warrants to purchase 15,075,571 shares of our common stock exercise prices ranging from $0.07 to $0.50 per share which we refer to as the Exchange Warrants in exchange for identical warrants to purchase Random Source common stock which were held by the warrant holders immediately prior to closing. The expiration date of each Exchange Warrant was identical to the Random Source warrant for which it was exchanged.
+
+ 
+
+ 
+
+16
+
+ 
+
+All of the Random Source shareholders and warrant holders were accredited investors and the transaction was accounted for as a reverse merger and recapitalization of Random Source whereby Random Source is considered the acquirer for accounting purposes. As a result of the reverse merger, we are no longer considered a shell company and our business and operations are now those of Random Source.
+
+On May 7, 2012 Random Source also entered into a stock repurchase agreement with the then majority shareholders of our company pursuant to which Random Source purchased 1,700,000 shares of our common stock, which we refer to as the Insiders Shares for $304,000. The purchase price was paid by $250,000 at closing and delivery of a 90 day secured promissory note in the principal amount of $54,000. At closing Random Source also prepaid interest under the note in the amount of $1,068. In order to secure the timely payment of the note, at closing we issued 2,000,000 shares of our common stock to counsel for the sellers to be held by him in escrow pursuant to the terms of the escrow agreement between the parties. In the event the note was not paid on or before the maturity date, the escrow shares were to be forfeited in full satisfaction of the purchase note. Following the closing of the stock repurchase agreement, the Insiders Shares were cancelled and returned to the status of authorized but unissued shares of our common stock. The purchase note was paid in full prior to the maturity date and the escrow shares have been returned to us by the escrow agent. These shares have been cancelled and returned to the status of authorized but unissued shares of our common stock.
+
+Random Source was incorporated under the laws of the State of Florida in September 2008. In March 2011 Random Source purchased 100% of the outstanding common stock of Hinson Office Supply from its shareholders for aggregate consideration of $262,000. It paid $100,000 of this amount at closing and issued the sellers three year promissory notes for the balance of $162,000. The notes, which bear interest at the rate of 2% per annum, are unsecured and are payable monthly.
+
+In October 2011 Random Source acquired the assets of SWH Enterprises, Inc. and Super Warehouse Gov, LLC from a secured creditor of these companies for an aggregate purchase price of $750,000. It used working capital to fund this acquisition.
+
+Legal proceedings
+
+We are not a party to any pending or threatened litigation.
+
+MANAGEMENT
+
+The following table provides information on our executive officers and directors:
+
+Name
+
+ 
+
+Age
+
+ 
+
+Positions
+
+David A. Kriegstein
+
+ 
+39
+ 
+
+Chief Executive Officer, President and Director
+
+Jason Merrick
+
+ 
+41
+ 
+
+Chief Financial Officer, Treasurer and Director
+
+Dustin Liukkonen
+
+ 
+28
+ 
+
+Chief Technology Officer and Director
+
+Robert Weitzner
+
+ 
+38
+ 
+
+Director
+
+David A. Kriegstein. Mr. Kriegstein has served an executive officer and a member of our board of director since May 2012. He has been an executive officer and a member of Random Source s board of directors since co-founding the company in September 2008. Mr. Kriegstein is primarily responsible for our day to day operations, including managing our sales staff and customer service team, as well as building relationships with new vendors to increase the product mix and variety for our customers. Since co-founding the company in December 1997, Mr. Kriegstein has also served as Co-President of Computer Nerds International, Inc., a web-based business offering computer hardware, software, electronics and related goods. Mr. Kriegstein received a B.A. in Communications in 1996 from the University of South Florida. Mr. Kriegstein devotes approximately 85% of his time and attention to our company.
+
+Jason Merrick. Mr. Merrick has served an executive officer and a member of our board of directors since May 2012. He has been an executive officer and a member of Random Source s board of directors since co-founding our company in September 2008. Mr. Merrick has also provided consulting services to Computer Nerds International, Inc., a web-based business offering computer hardware, software, electronics and related goods, since 2005. He currently serves as its Chief Financial Officer. In addition, since 2005 Mr. Merrick provided tax and accounting services to private clients. From March 1997 to October 2008 Mr. Merrick was Chief Financial Officer of Ruth Rales Jewish Family Service of South Palm Beach County, Incorporated, a Boca Raton based non-profit social service agency. Prior to moving to Florida in 1997, Mr. Merrick worked as a staff accountant with public accounting firms in Canada. Since 2008 Mr. Merrick has been an Adjunct Professor at Lynn University in Boca Raton, Florida where he teaches introductory accounting. Mr. Merrick was admitted to the Board of Examiners of the University of Illinois as a Certified Public Accountant in July 1998. He attended Concordia University where he received a BCom with an accounting major in 1993 and a Diploma in Accountancy in 1994. Mr. Merrick, a Certified Public Accountant, devotes approximately 75% of his time and attention to our company.
+
+ 
+
+ 
+
+17
+
+ 
+
+Dustin Liukkonen. Mr. Liukkonen has been an executive officer and a member of our board of directors since May 2012. He has been an executive officer and a director of Random Source since co-founding the company in September 2008. As our Chief Technology Officer, Mr. Liukkonen is responsible for our IT infrastructure. From February 2008 through mid-2010, Mr. Liukkonen also served as Lead Software Architect of Computer Nerds International, Inc., a web-based business offering computer hardware, software, electronics and related goods. From July 2005 until February 2008, Mr. Liukkonen was a senior web developer for Random Access, Inc., a Fort Lauderdale, Florida web development company. Mr. Liukkonen received a B.S. in Computer Science with a mathematics minor from Barry University in 2005. Mr. Liukkonen devotes 100% of his time and attention to our company.
+
+Robert Weitzner. Mr. Weitzner has served as a member of our board of directors since May 2012. He has served as an executive officer and a member of Random Source s board of directors since co-founding the company in September 2008. Since March 2001, Mr. Weitzner has also served as Director of Loss Prevention of Computer Nerds International, Inc., a web-based business offering computer hardware, software, electronics and related goods. Mr. Weitzner founded Topical Fruit Shakes, a smoothie fruit shake stand in the Coral Square Mall in 1996 and he operated that company until he sold the business in 2000. Mr. Weitzner received a B.S. in Business Administration with a major in finance in 1996 from the University of Florida.
+
+There are no family relationships between any of the executive officers and directors. Each director is elected at our annual meeting of shareholders and holds office until the next annual meeting of shareholders, or until his successor is elected and qualified.
+
+Director Qualifications, Committees of our board of directors and the Role of our Board in Risk Oversight
+
+Director qualifications
+
+Messrs. Kriegstein, Merrick, Weitzner and Liukkonen, the members of our board of directors, were appointed to our Board in May 2012 following the reverse merger with Random Source described elsewhere in this prospectus. Given their respective roles in the founding and/or operations of Random Source, we believe they each remain a good fit for our current needs. Mr. Kriegstein has significant operational experience in our industry and brings both a practical understanding of the industry and as well as hands-on experience in our business sector to our Board. Mr. Merrick, a CPA, has significant experience in managing and overseeing the financial aspects of our business which provides an additional dimension to his role as a director. Mr. Weitzner s operational understanding of our company provides our Board with a greater understanding of certain of the challenges we face in executing our growth strategy. As primarily a web-based business, Mr. Liukkonen s background in information technology provide our Board with another dimension for assessing our operational and strategy needs.
+
+Mr. Kriegstein serves as both our Chief Executive Officer and as one of the four members of our board of directors. We do not have any independent directors. The business and operations of our company are managed by our Board as a whole, including oversight of various risks, such as operational and liquidity risks that our company faces. As our company grows, we expect to expand our board of directors to include independent directors.
+
+Committees of our board of directors
+
+We have not established any committees of comprised of members of our board of directors, including an Audit Committee, a Compensation Committee or a Nominating Committee, any committee performing a similar function. The functions of those committees are being undertaken by board of directors as a whole. Because none of our directors are considered independent, we believe that the establishment of these committees would be more form over substance. We do not have a policy regarding the consideration of any director candidates which may be recommended by our shareholders, including the minimum qualifications for director candidates, nor has our board of directors established a process for identifying and evaluating director nominees, nor do we have a policy regarding director diversity. We have not adopted a policy regarding the handling of any potential recommendation of director candidates by our shareholders, including the procedures to be followed. Our Board has not considered or adopted any of these policies as we have never received a recommendation from any shareholder for any candidate to serve on our board of directors. Given our relative size, we do not anticipate that any of our shareholders will make such a recommendation in the near future. While there have been no nominations of additional directors proposed, in the event such a proposal is made, all members of our Board will participate in the consideration of director nominees. In considering a director nominee, it is likely that our Board will consider the professional and/or educational background of any nominee with a view towards how this person might bring a different viewpoint or experience to our Board.
+
+ 
+
+ 
+
+18
+
+ 
+
+Mr. Merrick is an audit committee financial expert within the meaning of Item 401(e) of Regulation S-K. In general, an audit committee financial expert is an individual member of the audit committee or board of directors who:
+
+ 
+
+ 
+
+ 
+
+understands generally accepted accounting principles and financial statements,
+
+ 
+
+ 
+
+is able to assess the general application of such principles in connection with accounting for estimates, accruals and reserves,
+
+ 
+
+ 
+
+has experience preparing, auditing, analyzing or evaluating financial statements comparable to the breadth and complexity to our financial statements,
+
+ 
+
+ 
+
+understands internal controls over financial reporting, and
+
+ 
+
+ 
+
+understands audit committee functions.
+
+ 
+
+Our securities are not quoted on an exchange that has requirements that a majority of our Board members be independent and we are not currently otherwise subject to any law, rule or regulation requiring that all or any portion of our board of directors include independent directors, nor are we required to establish or maintain an Audit Committee or other committee of our board of directors.
+
+Board oversight in risk management
+
+Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. We face a number of risks, including liquidity risk, operational risk, strategic risk and reputation risk. Our Chief Executive Officer also serves as one of our directors and we do not have a lead director. In the context of risk oversight, at the present stage of our operations we believe that our selection of one person to serve in both positions provides the Board with additional perspective which combines the operational experience of a member of management with the oversight focus of a member of the Board. The business and operations of our company are managed by our Board as a whole, including oversight of various risks that our company faces. Because the majority of our Board is comprised of members of our management, these individuals are responsible for both the day-to-day management of the risks we face as well as the responsibility for the oversight of risk management.
+
+Code of Ethics and Business Conduct
+
+We have adopted a Code of Business Conduct and Ethics, which applies to our board of directors, our executive officers and our employees, outlines the broad principles of ethical business conduct we adopted, covering subject areas such as:
+
+ 
+
+ 
+
+ 
+
+compliance with applicable laws and regulations,
+
+ 
+
+ 
+
+handling of books and records,
+
+ 
+
+ 
+
+public disclosure reporting,
+
+ 
+
+ 
+
+insider trading,
+
+ 
+
+ 
+
+discrimination and harassment,
+
+ 
+
+ 
+
+health and safety,
+
+ 
+
+ 
+
+conflicts of interest,
+
+ 
+
+ 
+
+competition and fair dealing, and
+
+ 
+
+ 
+
+protection of company assets.
+
+A copy of our Code of Business Conduct and Ethics is available without charge, to any person desiring a copy of the Code of Business Conduct and Ethics, by written request to us at our principal offices at 3400 SW 26 Terrace, Suite A-8, Fort Lauderdale, FL 33312.
+
+Director Compensation
+
+We have not established standard compensation arrangements for our directors and the compensation payable to each individual for their service on our Board is determined from time to time by our board of directors based upon the amount of time expended by each of the directors on our behalf. Currently, our the members of the board of directors do not receive any compensation for their services as directors.
+
+ 
+
+ 
+
+19
+
+ 
+
+EXECUTIVE COMPENSATION
+
+The following table summarizes all compensation recorded by us, including Random Source, in the past two years for:
+
+ 
+
+ 
+
+our principal executive officer or other individual serving in a similar capacity,
+
+ 
+
+ 
+
+our two most highly compensated executive officers other than our principal executive officer who were serving as executive officers at December 31, 2011 as that term is defined under Rule 3b-7 of the Securities Exchange Act of 1934, and
+
+ 
+
+ 
+
+up to two additional individuals for whom disclosure would have been required but for the fact that the individual was not serving as an executive officer at December 31, 2011.
+
+For definitional purposes, these individuals are sometimes referred to as the named executive officers. 
+
+SUMMARY COMPENSATION TABLE
+
+Name and principal position
+
+ 
+
+Year
+
+ 
+
+Salary
+
+($)
+
+ 
+ 
+
+Bonus
+
+($)
+
+ 
+ 
+
+Stock
+
+Awards
+
+($)
+
+ 
+ 
+
+Option
+
+Awards
+
+($)
+
+ 
+ 
+
+Non-Equity Incentive Plan Compensation
+
+($)
+
+ 
+ 
+
+Non-qualified Deferred Compensation Earnings
+
+($)
+
+ 
+ 
+
+All
+
+Other
+
+Compensation
+
+($)
+
+ 
+ 
+
+ 
+
+Total
+
+($)
+
+ 
+
+David A. Kriegstein, Chief Executive Officer (1)
+
+ 
+ 2012 
+ 
+ 
+ 50,000 
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 50,000 
+
+ 
+
+ 
+ 
+
+ 2011 
+
+ 
+ 
+
+ 50,000 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 0 
+
+ 
+ 
+ 
+
+ 50,000 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Dustin Liukkonen (2) 
+
+ 
+ 2012 
+ 
+ 
+ 120,000 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 120,000 
+ 
+
+ 
+ 
+ 2011 
+ 
+ 
+ 16,667 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 16,667 
+ 
+
+(1) Mr. Kriegstein was appointed our Chief Executive Officer in May 2012. The compensation information for 2011 and the first four months of 2012 reflects his compensation as Chief Executive Officer of Random Source.
+
+ (2) Mr. Liukkonen has served as our Chief Technology Officer since May 2012. The compensation information for the first four months of 2012 and for 2011 reflects his compensation as an employee of Random Source. 
+
+Employment agreements
+
+In April 2010 Random Source entered into one year employment agreements with each of Mr. Kriegstein and Mr. Merrick, which were amended in February 2012 to extend the term of these agreements to February 2015. Pursuant to the terms of these employment agreements Random Source pays Messrs. Kriegstein and Merrick an annual salary of $50,000 and $48,000, respectively. They are each to be entitled to bonuses at the discretion of the Random Source board of directors, as well as any benefits which Random Source may offer to its employees. The agreements, which contain an automatic yearly renewal provision, contain customary confidentially and non-compete provisions. Each employee's employment may be terminated upon his death or disability, and with or without cause. In the event Random Source should terminate the employee s employment upon his death or disability, the employee is entitled to his base salary for a period of the earlier of six months from the date of termination or the end of the term of the agreement. In the event Random Source should terminate the agreement for cause, as defined in the agreement, or if the employee should resign, he is entitled to payment of his base salary through the date of termination. At Random Source s option it may terminate the employee s employment without cause in which event he is entitled to payment of his base salary through the date of termination and for a period of the earlier of six months or the expiration date of the agreement. These employment agreements remain in effect. We expect that these employment agreements will be terminated and new employment agreements will be entered into between Messrs. Kriegstein and Merrick and our company in the future upon substantially similar terms and conditions.
+
+Outstanding equity awards at fiscal year-end
+
+The following table provides information concerning unexercised options, stock that has not vested and equity incentive plan awards for each named executive officer outstanding as of December 31, 2012: 
+
+OPTION AWARDS
+
+ 
+ 
+
+STOCK AWARDS
+
+ 
+
+Name
+
+ 
+
+Number of Securities Underlying Unexercised Options
+
+(#)
+
+Exercisable
+
+ 
+ 
+
+Number of Securities Underlying Unexercised Options
+
+(#)
+
+Unexercisable
+
+ 
+ 
+
+Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options
+
+(#)
+
+ 
+ 
+
+Option Exercise Price
+
+($)
+
+ 
+ 
+
+Option
+
+Expiration
+
+Date
+
+ 
+ 
+
+Number of Shares or Units of Stock That Have Not Vested
+
+(#)
+
+ 
+ 
+
+Market Value of Shares or Units of Stock That Have Not Vested
+
+($)
+
+ 
+ 
+
+Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested
+
+(#)
+
+ 
+ 
+
+Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
+
+(#)
+
+ 
+
+David A. Kriegstein
+
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Dustin Liukkonen 
+
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+ 
+ 
+ 0 
+ 
+
+ 
+
+ 
+
+20
+
+ 
+
+Limitation on liability
+
+ 
+
+The Florida Business Corporation Act permits the indemnification of directors, employees, officers and agents of Florida corporations. Our articles of incorporation and bylaws provide that we will indemnify our directors and officers to the fullest extent permitted by the Florida Business Corporation Act.
+
+The provisions of the Florida Business Corporation Act that authorize indemnification do not eliminate the duty of care of a director, and in appropriate circumstances equitable remedies such as injunctive or other forms of non-monetary relief will remain available under Florida law. In addition, each director will continue to be subject to liability for:
+
+ 
+
+ 
+
+violations of criminal laws, unless the director had reasonable cause to believe his conduct was lawful or had no reasonable cause to believe his conduct was unlawful,
+
+ 
+
+ 
+
+deriving an improper personal benefit from a transaction,
+
+ 
+
+ 
+
+voting for or assenting to an unlawful distribution, and
+
+ 
+
+ 
+
+willful misconduct or conscious disregard for our best interests in a proceeding by or in the right of a shareholder.
+
+The statute does not affect a director's responsibilities under any other law, such as the Federal securities laws. The effect of the foregoing is to require our company to indemnify our officers and directors for any claim arising against such persons in their official capacities if such person acted in good faith and in a manner that he reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.
+
+Insofar as the limitation of, or indemnification for, liabilities arising under the Securities Act of 1933 may be permitted to directors, officers, or persons controlling us pursuant to the foregoing, or otherwise, we have been advised that, in the opinion of the Securities and Exchange Commission, such limitation or indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
+
+CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
+
+From time to time we enter into transactions with Computer Nerds International, Inc., related party, including:
+
+ we purchase inventories and products for sale from Computer Nerds International, Inc. which totaled approximately $2,113,000 in 2011 and $7,700,000 during the first nine months of 2012. Accounts payable to Computer Nerds International, Inc. as of December 31, 2011 and September 30, 2012 was $300,939 and $328,488, respectively,
+
+ we sold various products to Computer Nerds International, Inc. which totaled approximately $500 in 2011, and $2,200 for the first nine months of 2012, and
+
+ on October 25, 2011, we entered into a Distribution Agreement with Computer Nerds International, Inc. whereby we appointed Computer Nerds International, Inc. as a non-exclusive distributor of our products for an initial term ending on December 31, 2012. The term automatically renews for a one year period on each subsequent anniversary date of the effective date and we can terminate this agreement at any time upon notice. Pursuant to the agreement, Computer Nerds International, Inc. agrees to charge us its cost plus a 2% distributor fee. On July 30, 2012, we entered into an amended Distribution Agreement with Computer Nerds International, Inc. to extend the term of the agreement to March 31, 2013 and reduce the distributor fee to 1.5%. We paid approximately $38,000 to Computer Nerds International, Inc. during the year ended December 31, 2011 and approximately $142,000 during the first nine months of 2012.
+
+ 
+
+ 
+
+21
+
+ 
+
+From time to time our executive officers and directors provide funds to us for working capital, including:
+
+ at December 31, 2010, our executive officers and directors had advanced an aggregate of $30,210. These advances were due on demand and bore interest at a rate of 6% per annum. In October 2011, we paid the principal and interest due under this advance, and
+
+ in October 2011, we issued promissory notes to three of our executive officers and directors in an aggregate amount of $150,000. The notes were due in January 2012 and bore interest at a rate of 18% per annum. Accrued interest as of December 31, 2011, amounted to $6,505. Between January 2012 and February 2012, we satisfied these promissory notes.
+
+Director independence
+
+None of our directors is considered independent within the meaning of meaning of Rule 5605 of the NASDAQ Marketplace Rules.
+
+PRINCIPAL SHAREHOLDERS
+
+At January 8, 2013 we had 127,368,088 shares of our common stock issued and outstanding. The following table sets forth information regarding the beneficial ownership of our common stock as of January 8, 2013 by:
+
+ 
+
+ 
+
+each person known by us to be the beneficial owner of more than 5% of our common stock;
+
+ 
+
+ 
+
+each of our directors;
+
+ 
+
+ 
+
+each of our named executive officers; and
+
+ 
+
+ 
+
+our named executive officers, directors and director nominees as a group.
+
+Unless otherwise indicated, the business address of each person listed is in care of 3400 SW 26 Terrace, Suite A-8, Fort Lauderdale, FL 33312. The percentages in the table have been calculated on the basis of treating as outstanding for a particular person, all shares of our common stock outstanding on that date and all shares of our common stock issuable to that holder in the event of exercise of outstanding options, warrants, rights or conversion privileges owned by that person at that date which are exercisable within 60 days of that date. Except as otherwise indicated, the persons listed below have sole voting and investment power with respect to all shares of our common stock owned by them, except to the extent that power may be shared with a spouse.
+
+ 
+ 
+
+Amount and Nature of Beneficial Ownership
+
+ 
+
+Name
+
+ 
+
+# of Shares
+
+ 
+ 
+
+% of Class
+
+ 
+
+David A. Kriegstein
+
+ 
+ 
+30,574,023
+ 
+ 
+ 
+24.0
+%
+
+Jason Merrick
+
+ 
+ 
+8,735,435
+ 
+ 
+ 
+6.9
+%
+
+Robert Weitzner
+
+ 
+ 
+13,103,153
+ 
+ 
+ 
+10.3
+%
+
+Dustin Liukkonen
+
+ 
+ 
+4,367,718
+ 
+ 
+ 
+3.4
+%
+
+All officers and directors as a group (four persons)
+
+ 
+ 
+56,780,329
+ 
+ 
+ 
+44.6
+%
+
+Jeremy L. Schneiderman (1)
+
+ 
+ 
+15,287,012
+ 
+ 
+ 
+12.0
+%
+
+Seth Schneiderman and Terri Schneiderman, JT (2)
+
+ 
+ 
+15,287,011
+ 
+ 
+ 
+12.0
+%
+
+Michelle Fischer (3)
+
+ 
+ 
+13,207,640
+ 
+ 
+ 
+10.4
+%
+
+Falcon Partners BVBA (4)
+
+ 
+ 
+10,000,000
+ 
+ 
+ 
+7.4
+%
+
+(1) Mr. Schneiderman s address is 3110 NE 210 Terrace, Aventura, FL 33180.
+
+(2) Mr. an Mrs. Schneiderman s address is 2961 W. Vista Circle, Davie, FL 33328.
+
+(3) Ms. Fischer s address is 2840 W. Vista Circle, Davie, FL 33328.
+
+(4) The number of shares owned includes 7,500,000 shares issuable upon the exercise of warrants with exercise prices ranging from $0.15 to $0.50 per share. Falcon Partners BVBA s address is Jan Welterslaan 13 2100 Deurne, Antwerp, Belgium.
+
+ 
+
+ 
+
+22
+
+ 
+
+Securities authorized for issuance under equity compensation plans
+
+The following table sets forth securities authorized for issuance under any equity compensation plans approved by our shareholders as well as any equity compensation plans not approved by our shareholders as of December 31, 2011.
+
+Plan category
+
+ 
+
+Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)
+
+ 
+ 
+
+Weighted average exercise price of outstanding options, warrants and rights
+
+ 
+ 
+
+Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
+
+ 
+
+Plans approved by our shareholders:
+
+ 
+ 
+0
+ 
+ 
+ 
+-
+ 
+ 
+ 
+0
+ 
+
+Plans not approved by shareholders:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Random Source 2010 Equity Compensation Plan
+
+ 
+ 
+180,000
+ 
+ 
+$
+0.10
+ 
+ 
+ 
+6,200,000
+ 
+
+2010 Equity Compensation Plan
+
+In April 2010, Random Sources board of directors and shareholders authorized the 2010 Equity Compensation Plan, which we refer to as the 2010 Plan, initially covering 7,000,000 shares of common stock. The purpose of the 2010 Plan is to enable us to offer to our employees, officers, directors and consultants, whose past, present and/or potential contributions to our company have been, are or will be important to our success, an opportunity to acquire a proprietary interest in our company. The 2010 Plan is administered by our board of directors. Plan options may either be:
+
+ 
+
+incentive stock options (ISOs),
+
+ 
+
+non-qualified options (NSOs),
+
+ 
+
+awards of our common stock, or
+
+ 
+
+rights to make direct purchases of our common stock which may be subject to certain restrictions.
+
+Any option granted under the 2010 Plan must provide for an exercise price of not less than 100% of the fair market value of the underlying shares on the date of grant, but the exercise price of any ISO granted to an eligible employee owning more than 10% of our outstanding common stock must not be less than 110% of fair market value on the date of the grant. The plan further provides that with respect to ISOs the aggregate fair market value of the common stock underlying the options which are exercisable by any option holder during any calendar year cannot exceed $100,000. The term of each plan option and the manner in which it may be exercised is determined by the board of directors or the compensation committee, provided that no option may be exercisable more than 10 years after the date of its grant and, in the case of an incentive option granted to an eligible employee owning more than 10% of the common stock, no more than five years after the date of the grant. In the event of any stock split of our outstanding common stock, the board of directors in its discretion may elect to maintain the stated amount of shares reserved under the plan without giving effect to such stock split. Subject to the limitation on the aggregate number of shares issuable under the plan, there is no maximum or minimum number of shares as to which a stock grant or plan option may be granted to any person.
+
+As part of the reverse merger with Random Source, options granted under this plan are exercisable into shares of our common stock.
+
+DESCRIPTION OF SECURITIES
+
+We are authorized to issue 200,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share. At January 8, 2013 we had 127,368,088 shares of common stock and no shares of preferred stock issued and outstanding.
+
+Common stock
+
+The holders of common stock are entitled to one vote per share on all matters submitted to a vote of shareholders, including the election of directors. There is no right to cumulate votes in the election of directors. The holders of common stock are entitled to any dividends that may be declared by the board of directors out of funds legally available for payment of dividends subject to the prior rights of holders of preferred stock and any contractual restrictions we have against the payment of dividends on common stock. In the event of our liquidation or dissolution, holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preferences of any outstanding shares of preferred stock. Holders of common stock have no preemptive rights and have no right to convert their common stock into any other securities.
+
+ 
+
+ 
+
+23
+
+ 
+
+Preferred stock
+
+The preferred stock is issuable in one or more series with such designations, voting powers, if any, preferences and relative, participating, optional or other special rights, and such qualifications, limitations and restrictions, as are determined by resolution of our board of directors. The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control of our company without further action by shareholders and could adversely affect the rights and powers, including voting rights, of the holders of common stock.
+
+Common stock purchase warrants
+
+In May 2012 in connection with the closing of the reverse merger with Random Source, we issued the Random Source shareholders who were also warrant holders the Exchange Warrants to purchase 15,075,571 shares of our common stock exercise prices ranging from $0.07 to $0.50 per share in exchange for identical warrants to purchase Random Source common stock which were held by the warrant holders immediately prior to closing. The expiration date of each Exchange Warrant is identical to the Random Source warrant for which it was exchanged. The exercise price of the Exchange Warrants and the number of shares issuable upon the exercise of the warrants are subject to proportional adjustment in the event of stock splits, dividends, recapitalizations or similar transactions. Exchange Warrants to purchase 678,571 shares of our common stock with an exercise price of $0.07 per share are exercisable on a cashless basis. Exchange Warrants to purchase an additional 14,397,000 shares of our common stock with exercise prices ranging from $0.15 to $0.50 per share are callable by us, upon 30 days notice, at a call price of $0.001 per share if our stock is currently quoted for trading in the over the counter market, the closing price of our common stock equals or exceeds certain base thresholds for five consecutive trading days and there is an effective registration statement covering the resale of the shares of common stock underlying those Exchange Warrants. This prospectus is a part of that registration statement. This means that holders of these Exchange Warrants will have 30 days from the date the warrants are called to exercise the Exchange Warrants. Any warrant which has been called but remains unexercised by the call date will automatically terminate and no longer entitle the holder to exercise such warrant or to receive any consideration therefore, other than the call price.
+
+In July 2012, in connection with a private placement of our shares of common stock in which Mediterranean Securities Group, LLC, a broker-dealer and member of FINRA, acted as our placement agent we issued the firm and its designees five year warrants to purchase 142,857 shares of our common stock at an exercise price of $0.07 per share which are exercisable on a cashless basis as partial compensation for its services.
+
+Transfer agent
+
+The transfer agent and registrar for our common stock is Standard Registrar & Transfer Company Inc., 12528 South 1840 East, Draper, UT 84020.
+
+SELLING SECURITY HOLDERS
+
+At January 8, 2013 we had 127,368,088 shares of our common stock issued and outstanding. This prospectus relates to periodic offers and sales of up to 51,284,561 shares of our common stock by the selling security holders listed below and their pledgees, donees and other successors in interest, which underlie outstanding warrants held by the selling security holders, including:
+
+ 
+
+ 36,066,133 shares which are presently outstanding; and
+
+ 
+
+15,218,428 shares issuable upon the possible exercise of warrants with an exercise price ranging from $0.07 to $0.50 per share.
+
+The following table sets forth:
+
+ 
+
+the name of each selling security holder,
+
+ 
+
+the number of common shares owned, and
+
+ 
+
+the number of common shares being registered for resale by the selling security holder.
+
+Information on beneficial ownership of securities is based upon a record list of our shareholders. We may amend or supplement this prospectus from time to time to update the disclosure set forth in this prospectus. All of the securities owned by the selling security holders may be offered hereby. Because the selling security holders may sell some or all of the securities owned by them, and because there are currently no agreements, arrangements or understandings with respect to the sale of any of the securities, no estimate can be given as to the number of securities that will be held by the selling security holders upon termination of any offering made hereby.
+
+ 
+
+ 
+
+24
+
+ 
+
+Name of selling security holder
+
+ 
+
+No. of shares beneficially owned
+
+ 
+ 
+
+No. of shares being registered
+
+ 
+ 
+
+No. of shares owned after the offering
+
+ 
+ 
+
+% owned after the offering
+
+ 
+
+Argus Group LLC (1)
+
+ 
+ 
+718,851
+ 
+ 
+ 
+718,851
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Roxanne K. Beilly
+
+ 
+ 
+55,990
+ 
+ 
+ 
+55,990
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Brainard Ventures LLC (2)
+
+ 
+ 
+1,510,000
+ 
+ 
+ 
+1,510,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Ella Chesnutt
+
+ 
+ 
+55,990
+ 
+ 
+ 
+55,990
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+David Cohen (3)
+
+ 
+ 
+60,000
+ 
+ 
+ 
+60,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Paul Cohn and Shelley Cohn, JT (4)
+
+ 
+ 
+100,000
+ 
+ 
+ 
+100,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Emilio DiSanluciano (5)
+
+ 
+ 
+400,000
+ 
+ 
+ 
+400,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Nancie Doherty (6)
+
+ 
+ 
+160,000
+ 
+ 
+ 
+160,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Scott Dudak and Maria Dudak, TIE (7)
+
+ 
+ 
+200,000
+ 
+ 
+ 
+200,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Falcon Partners BVBA (8)
+
+ 
+ 
+10,000,000
+ 
+ 
+ 
+10,000,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Michelle Fischer
+
+ 
+ 
+13,207,640
+ 
+ 
+ 
+13,207,640
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Edward Fischer
+
+ 
+ 
+4,700,000
+ 
+ 
+ 
+4,700,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Andrew Garbarini and Kim Garbarini, JT (9)
+
+ 
+ 
+275,000
+ 
+ 
+ 
+275,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Gordon Gold (5)
+
+ 
+ 
+400,000
+ 
+ 
+ 
+400,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Grip d LLC (10)
+
+ 
+ 
+156,000
+ 
+ 
+ 
+156,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Joseph C. Henn (5)
+
+ 
+ 
+400,000
+ 
+ 
+ 
+400,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Frank Jichetti (4)
+
+ 
+ 
+100,000
+ 
+ 
+ 
+100,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Marcos Lapciuc and Tiffany Lapciuc, JT (11)
+
+ 
+ 
+40,000
+ 
+ 
+ 
+40,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Deena L. Leest (12)
+
+ 
+ 
+80,000
+ 
+ 
+ 
+80,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Jeff Levine (13)
+
+ 
+ 
+1,000,000
+ 
+ 
+ 
+1,000,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Sharon Levine (13)
+
+ 
+ 
+1,000,000
+ 
+ 
+ 
+1,000,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Jordan A. Linn (11)
+
+ 
+ 
+40,000
+ 
+ 
+ 
+40,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Bryon Main (3)
+
+ 
+ 
+60,000
+ 
+ 
+ 
+60,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Kyia McFadden (4)
+
+ 
+ 
+100,000
+ 
+ 
+ 
+100,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Gail Merrick (14)
+
+ 
+ 
+20,000
+ 
+ 
+ 
+20,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Howard Mofshin
+
+ 
+ 
+1,010,000
+ 
+ 
+ 
+1,010,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Sydney Monda
+
+ 
+ 
+5,000
+ 
+ 
+ 
+5,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Arthur Rabin (15)
+
+ 
+ 
+4,000,000
+ 
+ 
+ 
+4,000,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Susan Schneider
+
+ 
+ 
+50,990
+ 
+ 
+ 
+50,990
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Jared Schwab (16)
+
+ 
+ 
+413,571
+ 
+ 
+ 
+413,571
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Andrew Smith, DC (7)
+
+ 
+ 
+200,000
+ 
+ 
+ 
+200,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Brian Stone (11)
+
+ 
+ 
+40,000
+ 
+ 
+ 
+40,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Herb Tabin
+
+ 
+ 
+1,357,143
+ 
+ 
+ 
+1,357,143
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Madeline Tabin
+
+ 
+ 
+1,000,000
+ 
+ 
+ 
+1,000,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Carol Tabin (12)
+
+ 
+ 
+80,000
+ 
+ 
+ 
+80,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Steven I. Weinberger
+
+ 
+ 
+55,990
+ 
+ 
+ 
+55,990
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+John Weitzner (14)
+
+ 
+ 
+20,000
+ 
+ 
+ 
+20,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Bernard Weitzner (14)
+
+ 
+ 
+20,000
+ 
+ 
+ 
+20,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Kevin S. Wilde (17)
+
+ 
+ 
+120,000
+ 
+ 
+ 
+120,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+William Zeidel (18)
+
+ 
+ 
+140,000
+ 
+ 
+ 
+140,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Norman Becker (19)
+
+ 
+ 
+39,540
+ 
+ 
+ 
+14,540
+ 
+ 
+ 
+25,000
+ 
+ 
+
+ 1%
+
+ 
+
+Diane Martini
+
+ 
+ 
+25,000
+ 
+ 
+ 
+25,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Trevor R. Ashmore
+
+ 
+ 
+357,143
+ 
+ 
+ 
+357,143
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Sten Anders-Fellman
+
+ 
+ 
+714,286
+ 
+ 
+ 
+714,286
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Gail L. Babitt and JJ Rorie, JTWROS
+
+ 
+ 
+357,143
+ 
+ 
+ 
+357,143
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Edward Feighan
+
+ 
+ 
+1,337,143
+ 
+ 
+ 
+357,143
+ 
+ 
+ 
+980,000
+ 
+ 
+
+ 1%
+
+ 
+
+Anthony Ivankovitch
+
+ 
+ 
+4,285,714
+ 
+ 
+ 
+4,285,714
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Emmet Sullivan and Kathleen Sullivan, JTWROS
+
+ 
+ 
+178,571
+ 
+ 
+ 
+178,571
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Mediterranean Securities Group, LLC (20)
+
+ 
+ 
+158,287
+ 
+ 
+ 
+158,287
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Alan Jacobs (20)
+
+ 
+ 
+114,285
+ 
+ 
+ 
+114,285
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Michael Jacobs (20)
+
+ 
+ 
+114,285
+ 
+ 
+ 
+114,285
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Amy Keebler (20)
+
+ 
+ 
+6,000
+ 
+ 
+ 
+6,000
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Donald E. Wray and Linda Wray, JTWROS
+
+ 
+ 
+178,571
+ 
+ 
+ 
+178,571
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Elite Pacific Group Limited (21)
+
+ 
+ 
+714,286
+ 
+ 
+ 
+714,286
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Philip G. Meng
+
+ 
+ 
+178,571
+ 
+ 
+ 
+178,571
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Mark Dante
+
+ 
+ 
+178,571
+ 
+ 
+ 
+178,571
+ 
+ 
+ 
+0
+ 
+ 
+ 
+0
+ 
+
+Total
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 51,284,561 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+25
+
+ 
+
+(1) Lauren Carajohn holds voting and dispositive control over securities held of record by Argus Group LLC.
+
+(2) Mr. Donald Brainard holds voting and dispositive control over securities held of record by Brainard Ventures LLC.
+
+(3) The number of shares owned and offering includes 45,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(4) The number of shares owned and offering includes 75,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(5) The number of shares owned and offering includes 300,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(6) The number of shares owned and offering includes 120,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(7) The number of shares owned and offering includes 150,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(8) The number of shares owned and offering includes 7,500,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share. Gerda Van Hoeydonck holds voting and dispositive control over securities held of record by Falcon Partners BVBA.
+
+(9) The number of shares owned and offering includes 150,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share and 75,000 shares underlying warrants with an exercise price of $0.07 per share.
+
+(10) The number of shares owned and offering includes 117,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share. Mr. Craig Agranoff holds voting and dispositive control over securities held of record by Grip d LLC.
+
+(11) The number of shares owned and offering includes 30,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(12) The number of shares owned and offering includes 60,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(13) The number of shares owned and offering includes 750,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(14) The number of shares owned and offering includes 15,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+ 
+
+ 
+
+26
+
+ 
+
+(15) The number of shares owned and offering includes 3,000,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(16) The number of shares owned and offering includes 45,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share and 353,571 shares underlying warrants with an exercise price of $0.07 per share.
+
+(17) The number of shares owned and offering includes 90,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(18) The number of shares owned and offering includes 105,000 shares underlying warrants with exercise prices ranging from $0.15 to $0.50 per share.
+
+(19) Mr. Becker served as an executive officer and director of our company from 2004 until May 2012.
+
+(20) The number of shares owned and offered includes shares underlying warrants with an exercise price of $0.07 per share.
+
+(21) Kwok-Wing Pang has voting and dispositive control over securities held of record by Elite Pacific Group Limited.
+
+ 
+
+Certain of the selling security holders are broker-dealers or affiliates of broker-dealers, including:
+
+ Mediterranean Securities Group, LLC, a broker-dealer and member of FINRA, acted as placement agent for us in two private placements. As partial compensation for these services in the ordinary course of its business as the placement agent we issued the firm, and its designees Mr. Alan Jacobs, Mr. Michael Jacobs, Mr. Jared Schwab, Mr. Andrew Garbarini and Ms. Amy Keebler, placement agent warrants. The shares underlying these placement agent warrants are included in this prospectus. A portion of these placement agent warrants were assigned to Messrs. Jacobs, Jacobs, Schwab and Garbarini and Ms. Keebler, employees of Mediterranean Securities Group, LLC, by the firm as compensation to them in the regular course of their employment with that firm. At the time of the receipt of the warrants, neither Messrs. Jacobs, Jacobs, Schwab or Garbarini nor Ms. Keebler had any agreement or understanding, directly or indirectly, with any person to distribute those securities,
+
+ Mr. Garbarini and his wife also purchased securities from us for their own account in a private offering in which Mediterranean Securities Group LLC did not serve as placement agent and otherwise had no involvement. At the time of this investment, neither Mr. nor Mrs. Garbarini had any agreement or understanding, directly or indirectly, with any person to distribute those securities, and
+
+ Mr. Emilio DiSanluciano purchased securities from us for his own account in a private offering.
+
+Mr. DiSanluciano is an employee of Felix Investments LLC, a broker-dealer and member of FINRA. We do not have any relationship with Felix Investments LLC. At the time of this investment, Mr. DiSanluciano did not have any agreement or understanding, directly or indirectly, with any person to distribute those securities.
+
+Except as set forth above, none of the selling security holders are broker-dealers or affiliates of broker-dealers. None of the selling security holders has, or within the past three years has had, any position, office or other material relationship with us or any of our predecessors or affiliates, other than as described previously in this section. We have agreed to pay full costs and expenses, incentives to the issuance, offer, sale and delivery of the shares, including all fees and expenses in preparing, filing and printing the registration statement and prospectus and related exhibits, amendments and supplements thereto and mailing of those items. We will not pay selling commissions and expenses associated with any sale by the selling security holders.
+
+ 
+
+ 
+
+27
+
+ 
+
+ 
+
+PLAN OF DISTRIBUTION
+
+Each selling security holder and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of common stock covered hereby on the OTC Bulletin Board or any other stock exchange, market or trading facility on which the shares are traded or in private transactions. These sales may be at fixed or negotiated prices. A selling security holder may use any one or more of the following methods when selling shares:
+
+ 
+
+ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
+
+ 
+
+block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
+
+ 
+
+purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
+
+ 
+
+an exchange distribution in accordance with the rules of the applicable exchange;
+
+ 
+
+privately negotiated transactions;
+
+ 
+
+settlement of short sales entered into after the effective date of the registration statement of which this prospectus is a part;
+
+ 
+
+in transactions through broker-dealers that agree with the selling security holders to sell a specified number of such shares at a stipulated price per share;
+
+ 
+
+through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
+
+ 
+
+a combination of any such methods of sale; or
+
+ 
+
+any other method permitted pursuant to applicable law.
+
+At any time after May 10, 2013, the one year anniversary from the date we filed Form 10 information with the SEC following the reverse merger with Random Source, the selling security holders may also sell shares under Rule 144 under the Securities Act of 1933 if available, rather than under this prospectus.
+
+Broker-dealers engaged by the selling security holders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the selling security holders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this prospectus, in the case of an agency transaction not in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a markup or markdown in compliance with FINRA IM-2440.
+
+In connection with the sale of the common stock or interests therein, the selling security holders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The selling security holders may also sell shares of the common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The selling security holders may also enter into option or other transactions with broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus, as supplemented or amended to reflect such transaction.
+
+Certain of the selling security holders and any broker-dealers or agents that are involved in selling the shares may be deemed to be underwriters within the meaning of the Securities Act of 1933 in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act of 1933.
+
+Because certain of selling security holders may be deemed to be underwriters within the meaning of the Securities Act of 1933, they will be subject to the prospectus delivery requirements of the Securities Act of 1933 including Rule 172 thereunder. The resale shares will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale shares of common stock covered hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.
+
+Under applicable rules and regulations under the Securities Exchange Act of 1934, any person engaged in the distribution of the resale shares may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution. In addition, the selling security holders will be subject to applicable provisions of the Securities Exchange Act of 1934 and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the common stock by the selling security holders or any other person. We will make copies of this prospectus available to the selling security holders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale, including by compliance with Rule 172 under the Securities Act of 1933.
+
+ 
+
+ 
+
+28
+
+ 
+
+LEGAL MATTERS
+
+The validity of the securities offered by this prospectus will be passed upon for us by Pearlman Schneider LLP, 2200 Corporate Boulevard, N.W., Suite 210, Boca Raton, Florida 33431. Current and former affiliates of Pearlman Schneider LLP are the owners of 239,960 shares of our common stock which are included in this prospectus.
+
+EXPERTS
+
+Our consolidated balance sheets as of December 31, 2011 and 2010 and the related consolidated statement of operations, changes in shareholders equity and cash flows for the years ended December 31, 2011 and 2010 included in this prospectus have been audited by Sherb & Co, LLP, independent registered public accounting firm, as indicated in their report with respect thereto, and have been so included in reliance upon the report of such firm given on their authority as experts in accounting and auditing.
+
+WHERE YOU CAN FIND ADDITIONAL INFORMATION
+
+We have filed with the Securities and Exchange Commission the registration statement on Form S-1 under the Securities Act of 1933 for the common stock offered by this prospectus. This prospectus, which is a part of the registration statement, does not contain all of the information in the registration statement and the exhibits filed with it, portions of which have been omitted as permitted by Securities and Exchange Commission rules and regulations. For further information concerning us and the securities offered by this prospectus, we refer to the registration statement and to the exhibits filed with it. Statements contained in this prospectus as to the content of any contract or other document referred to are not necessarily complete. In each instance, we refer you to the copy of the contracts and/or other documents filed as exhibits to the registration statement.
+
+This registration statement on Form S-1, including exhibits, is available over the Internet at the Securities and Exchange Commission s website at http://www.sec.gov. You may also read and copy any document we file with the Securities and Exchange Commission at its public reference facilities:
+
+Public Reference Room Office
+
+100 F Street, N.E.
+
+Room 1580
+
+Washington, D.C. 20549
+
+ 
+
+You may also obtain copies of the documents at prescribed rates by writing to the Public Reference Section of the Securities and Exchange Commission at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Callers in the United States can also call 1-202-551-8090 for further information on the operations of the public reference facilities.
+
+ 
+
+ 
+
+29
+
+ 
+
+No dealer, sales representative or any other person has been authorized to give any information or to make any representations other than those contained in this prospectus and, if given or made, such information or representation must not be relied upon as having been authorized by the company or any of the underwriters. This prospectus does not constitute an offer of any securities other than those to which it relates or an offer to sell, or a solicitation of any offer to buy, to any person in any jurisdiction where such an offer or solicitation would be unlawful. Neither the delivery of this prospectus nor any sale made hereunder shall, under any circumstances, create an implication that the information set forth herein is correct as of any time subsequent to the date hereof.
+
+TABLE OF CONTENTS
+
+ 
+
+ 
+
+Page
+
+ 
+
+About this Prospectus
+
+2
+
+ 
+
+PROGUARD ACQUISITION
+
+CORP.
+
+ 
+
+ 
+
+ 
+
+ 
+
+PROSPECTUS
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+________________, 2013
+
+ 
+
+ 
+
+ 
+
+ 51,284,561 Shares of Common Stock
+
+Other Pertinent Information
+
+2
+
+Prospectus Summary
+
+2
+
+Summary of the Offering
+
+2
+
+Selected Financial Data
+
+3
+
+Risk Factors
+
+3
+
+Cautionary Statement Regarding Forward Looking Information
+
+7
+
+Market for Common Equity and Related Shareholder Matters
+
+7
+
+Capitalization
+
+9
+
+Use of Proceeds
+
+9
+
+Management s Discussion and Analysis of Financial Statements and Results of Operations
+
+9
+
+Our Business
+
+13
+
+Management
+
+17
+
+Executive Compensation
+
+20
+
+Certain Relationships and Related Transactions
+
+21
+
+Principal Shareholders
+
+22
+
+Description of Securities
+
+23
+
+Selling Security Holders
+
+24
+
+Plan of Distribution
+
+28
+
+Legal Matters
+
+29
+
+Experts
+
+29
+
+Where You Can Find Additional Information
+
+29
+
+Index to Consolidated Financial Statements
+
+F-1
+
+ 
+
+ 
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP.
+
+INDEX TO FINANCIAL STATEMENTS
+
+ 
+
+ 
+ 
+Page No.
+ 
+
+Consolidated Balance Sheets at September 30, 2012 (unaudited) and December 31, 2011
+
+ 
+ 
+F-2
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Consolidated Statements of Operations (unaudited) for the three and nine months ended September 30, 2012 and 2011
+
+ 
+ 
+F-3
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2012 and 2011
+
+ 
+ 
+F-4
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Notes to Unaudited Consolidated Financial Statements September 30, 2012
+
+ 
+ 
+F-5
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Report of Independent Registered Public Accounting Firm
+
+ 
+ 
+F-18
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Consolidated Balance Sheets of Random Source, Inc. and Subsidiaries at December 31, 2011 and 2010
+
+ 
+ 
+F-19
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Consolidated Statements of Operations of Random Source, Inc. and Subsidiaries for the years ended December 31, 2011 and 2010
+
+ 
+ 
+F-20
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Consolidated Statements of Stockholders Equity(Deficit) of Random Source, Inc.and Subsidiaries for the years ended December 31, 2011 and 2010
+
+ 
+ 
+F-21
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Consolidated Statements of Cash Flows of Random Source, Inc. and Subsidiaries for the years ended December 31, 2011 and 2010
+
+ 
+ 
+F-22
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Notes to Consolidated Financial Statements of Random Source, Inc. and Subsidiaries December 31, 2011
+
+ 
+ 
+F-23
+ 
+
+ 
+
+F-1
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES 
+
+CONSOLIDATED BALANCE SHEETS
+
+ 
+
+ 
+ 
+
+September 30,
+
+ 
+ 
+
+December 31,
+
+ 
+
+ 
+ 
+
+2012
+
+ 
+ 
+
+2011
+
+ 
+
+ 
+ 
+
+(Unaudited)
+
+ 
+ 
+ 
+ 
+
+ASSETS
+
+Current assets:
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash
+
+ 
+$
+84,419
+ 
+ 
+$
+277,857
+ 
+
+Accounts receivable - net
+
+ 
+ 
+438,626
+ 
+ 
+ 
+361,325
+ 
+
+Inventory
+
+ 
+ 
+10,285
+ 
+ 
+ 
+9,020
+ 
+
+Other receivables
+
+ 
+ 
+16,000
+ 
+ 
+ 
+12,444
+ 
+
+Due from related party
+
+ 
+ 
+-
+ 
+ 
+ 
+2,691
+ 
+
+Prepaid expenses and other current assets
+
+ 
+ 
+39,596
+ 
+ 
+ 
+73,097
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Total current assets
+
+ 
+ 
+588,926
+ 
+ 
+ 
+736,434
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Other assets:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Property and equipment, net
+
+ 
+ 
+18,688
+ 
+ 
+ 
+31,302
+ 
+
+Website development cost
+
+ 
+ 
+72,210
+ 
+ 
+ 
+-
+ 
+
+Intangible asset, net
+
+ 
+ 
+613,931
+ 
+ 
+ 
+861,747
+ 
+
+Deposits
+
+ 
+ 
+111,652
+ 
+ 
+ 
+49,673
+ 
+
+Total other assets
+
+ 
+ 
+816,481
+ 
+ 
+ 
+942,722
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Total assets
+
+ 
+$
+1,405,407
+ 
+ 
+$
+1,679,156
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+LIABILITIES AND STOCKHOLDERS' EQUITY
+
+Current liabilities:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Accounts payable and accrued liabilities
+
+ 
+$
+414,676
+ 
+ 
+$
+487,460
+ 
+
+Accounts payable - related party
+
+ 
+ 
+328,488
+ 
+ 
+ 
+300,939
+ 
+
+Loan payable
+
+ 
+ 
+194,173
+ 
+ 
+ 
+-
+ 
+
+Notes payable - short term
+
+ 
+ 
+55,681
+ 
+ 
+ 
+55,681
+ 
+
+Deferred discount - short term
+
+ 
+ 
+100,000
+ 
+ 
+ 
+100,000
+ 
+
+Customer deposits
+
+ 
+ 
+16,110
+ 
+ 
+ 
+15,285
+ 
+
+Due to related parties
+
+ 
+ 
+-
+ 
+ 
+ 
+156,505
+ 
+
+Total current liabilities
+
+ 
+ 
+1,109,128
+ 
+ 
+ 
+1,115,870
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+LONG-TERM LIABILITIES:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Notes payable - long term
+
+ 
+ 
+22,797
+ 
+ 
+ 
+64,558
+ 
+
+Deferred discount - long term
+
+ 
+ 
+175,000
+ 
+ 
+ 
+250,000
+ 
+
+Total liabilities
+
+ 
+ 
+1,306,925
+ 
+ 
+ 
+1,430,428
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Stockholders' equity:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Preferred stock, $0.001 par value, 10,000,000 shares
+
+ authorized: no shares issued and outstanding
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Common stock, $0.001 par value, 500,000,000 shares 
+
+ authorized: 127,368,088 shares and 117,003,803 shares issued
+
+ and outstanding at September 30, 2012 and December 31, 2011, respectively
+
+ 
+ 
+127,368
+ 
+ 
+ 
+117,004
+ 
+
+Additional paid-in capital
+
+ 
+ 
+1,239,656
+ 
+ 
+ 
+1,103,046
+ 
+
+Accumulated deficit
+
+ 
+ 
+(1,268,542
+)
+ 
+ 
+(971,322
+)
+
+Subscription receivable
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Total stockholders' equity
+
+ 
+ 
+98,482
+ 
+ 
+ 
+248,728
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Total liabilities and stockholders' equity
+
+ 
+$
+1,405,407
+ 
+ 
+$
+1,679,156
+ 
+
+ 
+
+See accompanying notes to unaudited consolidated financial statements.
+
+ 
+
+ 
+
+F-2
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+CONSOLIDATED STATEMENTS OF OPERATIONS
+
+ 
+
+ 
+ 
+
+FOR THE
+
+THREE MONTHS
+
+ 
+ 
+
+FOR THE
+
+THREE MONTHS
+
+ 
+ 
+
+FOR THE
+
+NINE MONTHS
+
+ 
+ 
+
+FOR THE
+
+NINE MONTHS
+
+ 
+
+ 
+ 
+
+ENDED
+
+ 
+ 
+
+ENDED
+
+ 
+ 
+
+ENDED
+
+ 
+ 
+
+ENDED
+
+ 
+
+ 
+ 
+
+SEPTEMBER 30, 2012
+
+ 
+ 
+
+SEPTEMBER 30, 2011
+
+ 
+ 
+
+SEPTEMBER 30, 2012
+
+ 
+ 
+
+SEPTEMBER 30, 2011
+
+ 
+
+ 
+ 
+
+(Unaudited)
+
+ 
+ 
+
+(Unaudited)
+
+ 
+ 
+
+(Unaudited)
+
+ 
+ 
+
+(Unaudited)
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net sales
+
+ 
+$
+3,683,904
+ 
+ 
+$
+1,348,035
+ 
+ 
+$
+11,612,134
+ 
+ 
+$
+3,088,121
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cost of sales
+
+ 
+ 
+3,287,868
+ 
+ 
+ 
+1,163,879
+ 
+ 
+ 
+10,297,523
+ 
+ 
+ 
+2,527,182
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Gross profit
+
+ 
+ 
+396,036
+ 
+ 
+ 
+184,156
+ 
+ 
+ 
+1,314,611
+ 
+ 
+ 
+560,939
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Operating expenses:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Depreciation and amortization
+
+ 
+ 
+86,277
+ 
+ 
+ 
+22,904
+ 
+ 
+ 
+259,279
+ 
+ 
+ 
+52,444
+ 
+
+Marketing, selling and advertising expenses
+
+ 
+ 
+30,380
+ 
+ 
+ 
+8,687
+ 
+ 
+ 
+112,481
+ 
+ 
+ 
+20,002
+ 
+
+Compensation and related taxes
+
+ 
+ 
+216,742
+ 
+ 
+ 
+120,992
+ 
+ 
+ 
+736,983
+ 
+ 
+ 
+285,689
+ 
+
+Professional and consulting fees
+
+ 
+ 
+60,773
+ 
+ 
+ 
+56,591
+ 
+ 
+ 
+168,717
+ 
+ 
+ 
+151,860
+ 
+
+General and administrative
+
+ 
+ 
+84,285
+ 
+ 
+ 
+74,852
+ 
+ 
+ 
+327,166
+ 
+ 
+ 
+155,033
+ 
+
+Total operating expenses
+
+ 
+ 
+478,457
+ 
+ 
+ 
+284,026
+ 
+ 
+ 
+1,604,626
+ 
+ 
+ 
+665,028
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Loss from operations
+
+ 
+ 
+(82,421
+)
+ 
+ 
+(99,870
+)
+ 
+ 
+(290,015
+)
+ 
+ 
+(104,089
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Other expense
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Gain on sale of assets
+
+ 
+ 
+699
+ 
+ 
+ 
+-
+ 
+ 
+ 
+699
+ 
+ 
+ 
+-
+ 
+
+Interest expense
+
+ 
+ 
+(2,037
+)
+ 
+ 
+-
+ 
+ 
+ 
+(7,904
+)
+ 
+ 
+(418
+)
+
+Total other expense
+
+ 
+ 
+(1,338
+)
+ 
+ 
+-
+ 
+ 
+ 
+(7,205
+)
+ 
+ 
+(418
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Loss before provision for income taxes
+
+ 
+ 
+(83,759
+)
+ 
+ 
+(99,870
+)
+ 
+ 
+(297,220
+)
+ 
+ 
+(104,507
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Provision for income taxes
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net loss
+
+ 
+$
+(83,759
+)
+ 
+$
+(99,870
+)
+ 
+$
+(297,220
+)
+ 
+$
+(104,507
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+WEIGHTED AVERAGE COMMON SHARES
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Basic and Diluted
+
+ 
+ 
+127,982,996
+ 
+ 
+ 
+117,003,803
+ 
+ 
+ 
+125,085,972
+ 
+ 
+ 
+111,459,436
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+NET LOSS PER COMMON SHARE:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+OUTSTANDING - Basic and Diluted
+
+ 
+ 
+(0.00
+)
+ 
+ 
+(0.00
+)
+ 
+ 
+(0.00
+)
+ 
+ 
+(0.00
+)
+
+ 
+
+See accompanying notes to unaudited consolidated financial statements.
+
+ 
+
+ 
+
+F-3
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES 
+
+CONSOLIDATED STATEMENTS OF CASH FLOWS
+
+ 
+
+ 
+ 
+
+FOR THE
+
+NINE MONTHS
+
+ 
+ 
+
+FOR THE
+
+NINE MONTHS
+
+ 
+
+ 
+ 
+
+ENDED
+
+ 
+ 
+
+ENDED
+
+ 
+
+ 
+ 
+
+SEPTEMBER 30, 2012
+
+ 
+ 
+
+SEPTEMBER 30, 2011
+
+ 
+
+ 
+
+ 
+
+(Unaudited)
+
+ 
+ 
+
+(Unaudited)
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash flows from operating activities:
+
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+Net loss
+
+ 
+$
+(297,220
+)
+ 
+$
+(104,507
+)
+
+Adjustments to reconcile net loss to net cash used in operating activities:
+
+ 
+ 
+ 
+ 
+ 
+
+Depreciation and amortization
+
+ 
+ 
+259,279
+ 
+ 
+ 
+52,444
+ 
+
+Gain on sale of assets
+
+ 
+ 
+(699
+)
+ 
+ 
+-
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Changes in operating assets and liabilities
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Accounts receivable
+
+ 
+ 
+(77,301
+)
+ 
+ 
+(238,896
+)
+
+Inventory
+
+ 
+ 
+(1,265
+)
+ 
+ 
+(34,179
+)
+
+Other receivables
+
+ 
+ 
+(3,556
+)
+ 
+ 
+(17,019
+)
+
+Prepaid expenses and other current assets
+
+ 
+ 
+34,501
+ 
+ 
+ 
+(30,778
+)
+
+Deposits
+
+ 
+ 
+(61,979
+)
+ 
+ 
+(4,500
+)
+
+Accounts payable and accrued liabilities
+
+ 
+ 
+(72,784
+)
+ 
+ 
+187,586
+ 
+
+Accounts payable - related party
+
+ 
+ 
+27,549
+ 
+ 
+ 
+(4,180
+)
+
+Deferred discount - short term
+
+ 
+ 
+-
+ 
+ 
+ 
+100,000
+ 
+
+Customer deposits
+
+ 
+ 
+825
+ 
+ 
+ 
+-
+ 
+
+Deferred discount - long term
+
+ 
+ 
+(75,000
+)
+ 
+ 
+275,000
+ 
+
+Net cash (used in) provided by operating activities
+
+ 
+ 
+(267,650
+)
+ 
+ 
+180,971
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash flows from investing activities:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Website development costs
+
+ 
+ 
+(72,210
+)
+ 
+ 
+-
+ 
+
+Proceeds from sale of assets
+
+ 
+ 
+1,850
+ 
+ 
+ 
+-
+ 
+
+Cash used in acquisition of business
+
+ 
+ 
+-
+ 
+ 
+ 
+(122,884
+)
+
+ Purchase of property and equipment
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Net cash used in investing activities
+
+ 
+ 
+(70,360
+)
+ 
+ 
+(122,884
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash flows from financing activities:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Payments on notes payable
+
+ 
+ 
+(95,761
+)
+ 
+ 
+(27,841
+)
+
+Proceeds from related party advances, net of repayments on related party advances
+
+ 
+ 
+(153,814
+)
+ 
+ 
+(19,329
+)
+
+Proceeds from loan payable, net of repayments on loan payable
+
+ 
+ 
+194,173
+ 
+ 
+ 
+-
+ 
+
+Payment made in connection with stock repurchase agreement
+
+ 
+ 
+(275,000
+)
+ 
+ 
+-
+ 
+
+Payments to repurchase common stock
+
+ 
+ 
+(20,000
+)
+ 
+ 
+-
+ 
+
+Collection of subscription receivable
+
+ 
+ 
+-
+ 
+ 
+ 
+200
+ 
+
+Issuance cost on sale of common stock
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Proceeds from sale of common stock, net of issuance costs
+
+ 
+ 
+494,974
+ 
+ 
+ 
+679,900
+ 
+
+Net cash provided by financing activities
+
+ 
+ 
+144,572
+ 
+ 
+ 
+632,930
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net (decrease) increase in cash
+
+ 
+ 
+(193,438
+)
+ 
+ 
+691,017
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash at beginning of year
+
+ 
+ 
+277,857
+ 
+ 
+ 
+42,099
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash at end of period
+
+ 
+$
+84,419
+ 
+ 
+$
+733,116
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash paid for:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Interest
+
+ 
+$
+7,704
+ 
+ 
+$
+2,128
+ 
+
+Income taxes
+
+ 
+$
+-
+ 
+ 
+$
+-
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
+
+ 
+ 
+ 
+ 
+ 
+
+Issuance of notes payable in connection with the acquisition of business
+
+ 
+$
+-
+ 
+ 
+$
+162,000
+ 
+
+Value of intangible assets upon acquisition of business
+
+ 
+$
+-
+ 
+ 
+$
+241,265
+ 
+
+Purchase of property and equipment upon acquisition of business
+
+ 
+$
+-
+ 
+ 
+$
+17,671
+ 
+
+Purchase of other current assets upon acquisition of business
+
+ 
+$
+-
+ 
+ 
+$
+3,064
+ 
+
+Issuance of notes payable in connection with the stock repurchase agreement
+
+ 
+$
+54,000
+ 
+ 
+$
+-
+ 
+
+ 
+
+See accompanying notes to unaudited consolidated financial statements.
+
+ 
+
+ 
+
+F-4
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
+
+Organization
+
+Proguard Acquisition Corp. (the Company ) was incorporated under the laws of the State of Florida in June 2004. The Company provided professional protection to clients through installation and monitoring of fire, intrusion and environmental security systems.
+
+On May 7, 2012, the Company closed the reverse merger and related transactions contemplated by the Agreement of Merger and Plan of Reorganization dated April 27, 2012 (the Merger Agreement ) with Random Source Inc. ( Random Source ), and Proguard Acquisition Subsidiary Corp., the Company s newly-formed, wholly-owned Florida subsidiary (the Acquisition Sub ). Upon closing of the transactions contemplated under the Merger Agreement (the Merger ), the Acquisition Sub merged with and into Random Source, and Random Source, as the surviving corporation, became a wholly-owned subsidiary of the Company. In the Merger, all of the issued and outstanding capital stock of Random Source was transferred to the Company in exchange for shares of common stock of the Company. Such Merger caused Random Source to become a wholly-owned subsidiary of the Company.
+
+Prior to the Merger, the Company was a shell company with no business operations.
+
+The Merger was accounted for as a reverse merger and recapitalization. Random Source was the acquirer for financial reporting purposes and the Company was the acquired company. Consequently, the assets and liabilities and the operations reflected in the historical financial statements prior to the Merger were those of Random Source and was recorded at the historical cost basis of Random Source, and the consolidated financial statements after completion of the Merger included the assets and liabilities of the Company and Random Source, historical operations of Random Source and operations of the Company from the closing date of the Merger.
+
+Random Source was incorporated under the laws of the State of Florida in September 2008. The Company operates and sells office supplies such as high-quality, brand-name office products primarily to medium and large-sized businesses through its retail websites. The Company carries a wide selection of merchandise, including general office supplies, business machines and computers, office furniture, and other business-related products. Random Source has two subsidiaries, Lamfis, Inc. d/b/a Hinson Office Supply ( Hinson Office Supply ) and Superwarehouse Business Products, Inc. ( Superwarehouse ).
+
+Basis of Presentation
+
+The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America ( US GAAP ). The consolidated financial statements of the Company include the Company and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation. All adjustments (consisting of normal recurring items) necessary to present fairly the Company's financial position as of September 30, 2012, and the results of operations and cash flows for the nine months ended September 30, 2012 have been included. The results of operations for the nine months ended September 30, 2012 are not necessarily indicative of the results to be expected for the full year. The accounting policies and procedures used in the preparation of these consolidated financial statements have been derived from the audited financial statements of the Company for the year ended December 31, 2011, which are contained in the Form 8-K filed on May 10, 2012 and such consolidated balance sheet as of December 31, 2011 was derived from those financial statements.
+
+ 
+
+Use of Estimates and Assumptions
+
+The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made by management include, but are not limited to, the allowance for bad debts, the useful life of property and equipment, and useful life of intangible assets.
+
+ 
+
+ 
+
+F-5
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+FASB Accounting Standards Codification
+
+The issuance by Financial Accounting Standards Board ( FASB ) of the Accounting Standards Codification ( ASC ) on July 1, 2009 (effective for interim or annual reporting periods ending after September 15, 2009), changes the way that US GAAP is referenced.
+
+ 
+
+Beginning on that date, ASC officially became the single source of authoritative nongovernmental US GAAP; however, SEC registrants must also consider rules, regulations, and interpretive guidance issued by the SEC or its staff. The change affects the way the Company refers to US GAAP in financial statements and in its accounting policies. All existing standards that were used to create ASC became superseded. Instead, references to standards consist solely of the number used in the ASC s structural organization.
+
+Fair Value of Financial Instruments
+
+The Company adopted FASB ASC 820, Fair Value Measurements and Disclosures , for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing US GAAP that require the use of fair value measurements which establishes a framework for measuring fair value and expands disclosure about such fair value measurements. 
+
+ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below:
+
+ 
+
+Level 1:
+
+Observable inputs such as quoted market prices in active markets for identical assets or liabilities;
+
+ 
+
+Level 2:
+
+Observable market-based inputs or unobservable inputs that are corroborated by market data; and
+
+ 
+
+Level 3:
+
+Unobservable inputs for which there is little or no market data, which require the use of the reporting entity s own assumptions.
+
+The carrying amounts reported in the consolidated balance sheet for accounts receivable, other receivables, prepaid expenses, accounts payable, accrued liabilities, and customer deposits approximate their estimated fair market value based on the short-term maturity of these instruments.
+
+In addition, FASB ASC 825-10-25 Fair Value Option was effective for January 1, 2008. ASC 825-10-25 expands opportunities to use fair value measurements in financial reporting and permits entities to choose to measure many financial instruments and certain other items at fair value.
+
+Cash and Cash Equivalents
+
+The Company considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents. The Company places its cash with a high credit quality financial institution. The Company account at this institution is insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. In addition to the basic insurance deposit coverage, the FDIC is providing temporary unlimited coverage for non-interest bearing transaction accounts through December 31, 2012. At September 30, 2012, the Company has not reached bank balances exceeding the FDIC insurance limit on interest bearing accounts. To reduce its risk associated with the failure of such financial institution, the Company evaluates at least annually the rating of the financial institution in which it holds deposits.
+
+ 
+
+ 
+
+F-6
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Segments
+
+The Company s activities are within the office products and office supplies retail industry, which is the single industry segment the Company operates. Each operating subsidiary represents an operating segment and these segments have been aggregated, as the operating units meet all of the aggregation criteria. The Company has aggregated its operating segments based on the aggregation criteria outlined in ASC 280-10, which states that two or more operating segments may be aggregated into a single operating segment if aggregation is consistent with the objective and basic principles of the Statement, if the segments have similar economic characteristics, similar product, similar production processes, similar customers and similar methods of distribution. Therefore, the Company has a single operating segment for financial reporting purposes.
+
+Revenue Recognition
+
+The Company follows the guidance of the FASB ASC 605-10-S99 Revenue Recognition Overall SEC Materials . The Company records revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. Revenues consist primarily of product sales.
+
+ 
+
+Accounts Receivable
+
+The Company has a policy of reserving for questionable accounts based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to the bad debt expense after all means of collection have been exhausted and the potential for recovery is considered remote. As of September 30, 2012 and December 31, 2011, our allowance for doubtful accounts totaled $4,300 and $4,300, respectively. The Company did not consider it necessary to record any bad debt expense during the nine months ended September 30, 2012 and 2011.
+
+Inventory
+
+Inventory, consisting of finished goods related to the Company s products are stated at the lower of cost or market utilizing the first-in, first-out method.
+
+Concentrations of Credit Risk and Major Customers
+
+Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash and trade accounts receivable. The Company places its cash with high credit quality financial institutions. Most of the Company s sales are credit sales which are primarily to customers whose ability to pay is dependent upon the industry economics prevailing in these areas; however, concentrations of credit risk with respect to trade accounts receivables is limited due to generally short payment terms. The Company also performs ongoing credit evaluations of its customers to help further reduce credit risk.
+
+As of September 30, 2012, 20 customers accounted for approximately 36% of total accounts receivable. As of December 31, 2011, 8 customers accounted for 15% of total accounts receivable. No single customer accounted for greater than 10% of sales of the Company for the nine months ended September 30, 2012 and 2011.
+
+ 
+
+ 
+
+F-7
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Prepaid expenses and other current assets
+
+Prepaid expenses and other current assets of $39,596 and $73,097 at September 30, 2012 and December 31, 2011, respectively, consist primarily of costs paid for future services which will occur within a year. Prepaid expenses include prepayments in cash for web marketing services, computer support services, consulting and business advisory services, rent, and prepaid insurance which are being amortized over the terms of their respective agreements.
+
+ 
+
+Deposits
+
+Deposits at September 30, 2012 and December 31, 2011 were $111,652 and $49,673, respectively, which consist of security deposits paid to third parties for office lease and credit card merchant holdbacks.
+
+Customer Deposit
+
+Customer deposits at September 30, 2012 and December 31, 2011 were $16,110 and $15,285, respectively, which consist of prepayments from third party customers to the Company and customer refunds. The Company will recognize the prepayments as revenue upon delivery of the products, in compliance with its revenue recognition policy.
+
+Marketing, selling and advertising costs
+
+Marketing, selling and advertising costs are expensed as incurred. Such expenses for the nine months ended September 30, 2012 and 2011 totaled $112,481 and $20,002, respectively.
+
+Income Taxes
+
+Income taxes are accounted for under the asset and liability method in accordance with ASC 740, Income Taxes . Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial carrying amounts of existing assets and liabilities and their respective tax bases as well as operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance to the extent that the recoverability of the asset is unlikely to be recognized.
+
+ 
+
+The Company follows ASC 740 rules governing uncertain tax positions, which provides guidance for recognition and measurement. This prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognization, classification and disclosure of these uncertain tax positions.
+
+Basic and Diluted Net Loss per Share
+
+Net loss per common share is calculated in accordance with ASC Topic 260: Earnings Per Share. Basic loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. The computation of diluted net loss per share does not include dilutive common stock equivalents in the weighted average shares outstanding as they would be anti-dilutive. At September 30, 2012, the Company had 180,000 outstanding options and 15,218,429 outstanding warrants. At September 30, 2011, the Company had 180,000 outstanding options.
+
+ 
+
+ 
+
+F-8
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Property and equipment
+
+Property and equipment are carried at cost. The cost of repairs and maintenance is expensed as incurred; major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income in the year of disposition. Depreciation is calculated on a straight-line basis over the estimated useful life of the assets, generally two to seven years. Leasehold improvements are amortized on a straight-line basis over the shorter of the useful life of the improvement or the remaining term of the lease.
+
+ 
+
+Website Development Costs
+
+The Company recognizes the costs associated with developing a website in accordance with ASC Topic 350 40 Internal Use Software. Internal and external costs incurred during the preliminary project stage are expensed as they are incurred. Internal and external costs incurred to develop internal use computer software during the application development stage are capitalized. Training costs are not internal use software development costs and, if incurred during this stage, are expensed as incurred. These capitalized costs will be amortized based on their estimated useful life over three years from the date of service. The Company expects to place the website into service in December 2012. Payroll and other related costs directly related to the application development stage are capitalized. Ongoing updates to the website will be expensed as incurred. Website development costs as of September 30, 2012 amounted to $72,210.
+
+Impairment of Long-lived Assets
+
+The Company accounts for the impairment or disposal of long-lived assets according to FASB ASC 360 Property, Plant and Equipment . ASC 360 clarifies the accounting for the impairment of long-lived assets and for long-lived assets to be disposed of, including the disposal of business segments and major lines of business. Long-lived assets are reviewed when facts and circumstances indicate that the carrying value of the asset may not be recoverable. When necessary, impaired assets are written down to estimated fair value based on the best information available. Estimated fair value is generally based on either appraised value or measured by discounting estimated future cash flows. Considerable management judgment is necessary to estimate discounted future cash flows. Accordingly, actual results could vary significantly from such estimates. The Company did not consider it necessary to record any impairment charges during the nine months ended September 30, 2012 and 2011.
+
+Goodwill and Other Intangible Assets
+
+In accordance with ASC 350- 30-65 Goodwill and Other Intangible Assets , the Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following:
+
+ 
+
+1.
+
+Significant underperformance relative to expected historical or projected future operating results;
+
+ 
+
+2.
+
+Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and
+
+ 
+
+3.
+
+Significant negative industry or economic trends.
+
+When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. The Company did not consider it necessary to record any impairment charge on its intangible assets during the nine months ended September 30, 2012 and 2011.
+
+ 
+
+ 
+
+F-9
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+Employee Benefit Plan
+
+The Company offers a SIMPLE IRA plan which was established in December 2009 for all eligible employees. Employees meeting certain eligibility requirements can participate in the plan. Under the plan, the Company matches employee contributions to the plan up to 1% of the employee s salary. The Company made matching contributions of 1% totaling $952 and $1,667 during the nine months ended September 30, 2012 and 2011, respectively.
+
+Stock Based Compensation
+
+Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.
+
+Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the measurement date. The expense is recognized over the vesting period of the award. Until the measurement date is reached, the total amount of compensation expense remains uncertain. The Company initially records compensation expense based on the fair value of the award at the reporting date.
+
+Recent Accounting Pronouncements
+
+Accounting standards that have been issued or proposed by the FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption.
+
+ 
+
+NOTE 2 PROPERTY AND EQUIPMENT
+
+Property and equipment consisted of the following:
+
+ 
+ 
+
+Estimated
+
+life
+
+ 
+ 
+
+September 30,
+
+2012
+
+ 
+ 
+
+December 31,
+
+2011
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Transportation equipment
+
+ 
+
+2 years
+
+ 
+ 
+ 
+14,137
+ 
+ 
+ 
+17,671
+ 
+
+Furniture and fixtures
+
+ 
+
+7 years
+
+ 
+ 
+ 
+4,617
+ 
+ 
+ 
+4,617
+ 
+
+Leasehold improvement
+
+ 
+
+3 years
+
+ 
+ 
+ 
+18,266
+ 
+ 
+ 
+18,266
+ 
+
+Less: Accumulated depreciation
+
+ 
+ 
+ 
+ 
+ 
+ 
+(18,332
+)
+ 
+ 
+(9,252
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+$
+18,688
+ 
+ 
+$
+31,302
+ 
+
+For the nine months ended September 30, 2012 and 2011, depreciation expense amounted to $11,463 and $5,530, respectively. In August 2012, the Company sold transportation equipment with a net book value worth $1,151 to a third party for a sales price of $1,850 realizing a gain on sale of assets of $699.
+
+ 
+
+ 
+
+F-10
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 3 INTANGIBLE ASSETS
+
+Intangible assets were acquired from the acquisition by the Company s wholly owned subsidiary, Random Source, and its subsidiaries, Hinson Office Supply and Superwarehouse consisted of the following:
+
+ 
+ 
+
+September 30,
+
+2012
+
+ 
+ 
+
+December 31,
+
+2011
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Customer lists
+
+ 
+
+$
+
+991,265
+
+ 
+ 
+
+$
+
+991,265
+
+ 
+
+Accumulated amortization
+
+ 
+ 
+
+(377,334)
+
+ 
+ 
+ 
+
+(129,518
+
+)
+
+Intangible assets, net
+
+ 
+
+$
+
+613,931
+
+ 
+ 
+
+$
+
+861,747
+
+ 
+
+Customer lists for Hinson Office Supply, are being amortized on a straight-line basis over the estimated useful life of three years. Customer lists for Superwarehouse are amortized over the estimated useful life of three years. The Company assesses fair market value for any impairment to the carrying values. As of September 30, 2012 and December 31, 2011 management concluded that there was no impairment to the acquired assets.
+
+The weighted average amortization period on total is approximately 2.50 years. Amortization expense for the nine months ended September 30, 2012 and 2011 was $247,816 and $46,914, respectively.
+
+ 
+
+Future amortization of intangible assets, net is as follows:
+
+ 
+
+ 2012
+
+ 
+
+$
+
+247,817
+
+ 
+
+ 2013
+
+ 
+ 
+
+330,422
+
+ 
+
+ 2014
+
+ 
+ 
+
+35,692
+
+ 
+
+ Total
+
+ 
+
+$
+
+613,931
+
+ 
+
+NOTE 4 ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
+
+Accounts payable and accrued liabilities consist of the following:
+
+ 
+
+ 
+ 
+
+September 30,
+
+2012
+
+ 
+ 
+
+December 31,
+
+2011
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Accounts payable - trade
+
+ 
+
+$ 
+
+573,279
+
+ 
+ 
+
+$ 
+
+589,309
+
+ 
+
+Credit card
+
+ 
+ 
+
+12,215
+
+ 
+ 
+ 
+
+17,457
+
+ 
+
+Accrued expenses
+
+ 
+ 
+
+13,465
+
+ 
+ 
+ 
+
+78,453
+
+ 
+
+Accrued payroll, vacation and payroll tax
+
+ 
+ 
+
+104,780
+
+ 
+ 
+ 
+
+63,724
+
+ 
+
+Sales and business tax payable
+
+ 
+ 
+
+39,425
+
+ 
+ 
+ 
+
+39,456
+
+ 
+
+Total
+
+ 
+
+$
+
+743,164
+
+ 
+ 
+
+$
+
+788,399
+
+ 
+
+ 
+
+ 
+
+F-11
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 5 LOAN PAYABLE
+
+In December 2011, the Company entered into a Business Loan and Security Agreement (the Agreement ) whereby the borrower agreed to lend the Company up to a total amount of $71,000 which will be used for business purposes only. The maturity date of such loan ends 365 days after the disbursement of the initial loan which occurred on January 3, 2012. The loan included a repayment rate of 30% which shall be applied to the amount of the loan. Additionally, a non-refundable fee equal to 6% of the original principal balance (the loan fee ) of the loan and shall be payable upon the earliest of (a) the date upon which the loan is repaid in full (b) maturity date or (c) upon occurrence of event of default as defined in the Agreement. The lender has the right to accelerate the repayment of and declare immediately due and payable portion of the outstanding loan as defined in the Agreement. Upon the maturity date, the outstanding balance shall be immediately due and payable in full. Thereafter, until the outstanding balance is paid in full, the repayment rate shall be increased to 100%. The borrower also has the right to increase the repayment rate, temporarily or permanently, after the occurrence and during the continuance of an event of default. Pursuant to the Agreement, the Company has granted the borrower collateral and security interest in all of the assets and rights of the Company as defined in the Agreement, except as otherwise indicated.
+
+In July 2012, the Company entered into an amended Business Loan and Security Agreement whereby the initial loan amount has been increased to $175,000. The maturity date of such loan ends 365 days after the disbursement of this initial loan. The loan includes a repayment rate of 100% which shall be applied to the amount of the loan. Additionally, a non-refundable fee equal to 0.45% of the loan amount shall be payable upon the earliest of (a) the business day immediately preceding the next disbursement date (b) the date upon which the loan is repaid in full (c) termination date or (d) upon occurrence of event of default as defined in the agreement. In September 2012, the maximum loan amount was increased to $200,000. All other terms and conditions of the original Agreement remain in full force and effect. 
+
+As of September 30, 2012 and December 31, 2011, loan payable including related fees and interest under this agreement amounted to $194,173 and $0, respectively.
+
+NOTE 6 NOTES PAYABLE
+
+On March 9, 2011, the Company acquired 100% of the outstanding stock of Hinson Office Supply for $262,000. The stock purchase agreement calls for a $100,000 cash down payment with the balance of $162,000 payable in equal monthly installments of $4,640, fully amortized over thirty-six months with interest accruing at a rate of 2% per annum and matures on April 9, 2014. Promissory notes were issued to the former shareholders of Hinson Office Supply. The agreement calls for the last installment payment to be waived should the Company make all payments in a timely fashion. As of September 30, 2012 and December 31, 2011, principal balance on these notes amounted to $78,478 and $120,239, respectively.
+
+As of September 30, 2012 and December 31, 2011, accrued interest on these notes amounted to $0.
+
+On May 7, 2012 Random Source entered into a Stock Repurchase Agreement (the Stock Repurchase Agreement ) with the then majority shareholders of the Company pursuant to which Random Source purchased 1,700,000 shares of the Company s common stock (the Insiders Shares ) for $304,000. The purchase price was paid by $250,000 at closing and delivery of a 90 day secured promissory note (the Purchase Note ) in the principal amount of $54,000. The Company shall pay the principal and interest on or before August 7, 2012 and bears interest at 8% per annum. At closing Random Source also prepaid interest under the Purchase Note in the amount of $1,068. 
+
+In order to secure the timely payment of the Purchase Note, at closing the Company issued 2,000,000 shares of the Company s common stock which such shares will be held in escrow pursuant to the terms of the Escrow Agreement between the parties. In the event the Purchase Note is paid on or before the maturity date, the certificate representing the Escrow Shares will be returned to the Company for cancellation. In the event, however, the Purchase Note is not paid on or before the maturity date, pursuant to the terms of the escrow agreement the Escrow Shares will be forfeited in full satisfaction of the Purchase Note. Following the closing of the Stock Repurchase Agreement, the Insiders Shares were cancelled and returned to the status of authorized but unissued shares of the Company s common stock. In August 2012, the Company satisfied in full the 90 day Purchase Note in the principal amount of $54,000. Following the payment of this obligation, the 2,000,000 shares of common stock which had been placed in escrow to secure the timely payment of the note were returned to the Company and have been cancelled and returned to the status of authorized but unissued shares. As of September 30, 2012, principal balance and accrued interest on this note amounted to $0.
+
+ 
+
+ 
+
+F-12
+
+ 
+
+ 
+
+NOTE 6 NOTES PAYABLE (continued)
+
+Notes payable short and long term portion consisted of the following:
+
+ 
+ 
+
+September 30,
+
+2012
+
+ 
+ 
+
+December 31,
+
+2011
+
+ 
+
+Total notes payable
+
+ 
+
+$
+
+78,478
+
+ 
+ 
+
+$
+
+120,239
+
+ 
+
+Less: current portion
+
+ 
+ 
+
+55,681
+
+ 
+ 
+ 
+
+55,681
+
+ 
+
+Long term portion
+
+ 
+
+$
+
+22,797
+
+ 
+ 
+
+$
+
+64,558
+
+ 
+
+NOTE 7 STOCKHOLDERS EQUITY
+
+Common Stock
+
+The Company is authorized to issue up to 500,000,000 shares of common stock, $.001 par value per share. As of September 30, 2012 and December 31, 2011, the Company had 127,368,088 shares and 117,003,803 shares outstanding, respectively. Holders are entitled to one vote for each share of common stock (or its equivalent).
+
+On May 7, 2012, the Company closed the Merger Agreement with Random Source, and the Acquisition Sub (see Note 1). Upon closing of the transactions contemplated under the Merger, the Acquisition Sub merged with and into Random Source, and Random Source, as the surviving corporation, became a wholly-owned subsidiary of the Company. In the Merger, in exchange for all of the issued and outstanding capital stock of Random Source, the Company issued the holders of those shares 127,989,517 shares of the Company s common stock, which, after giving effect to the stock repurchase described below, represented approximately 97.2% of the outstanding common stock, giving no effect to the shares of the Company s common stock underlying the Exchange Warrants.
+
+At closing, the Company also issued the Random Source shareholders who were also warrant holders common stock purchase warrants to purchase 15,075,571 shares of the Company s common stock exercise prices ranging from $0.07 to $0.50 per share (the Exchange Warrants ) in exchange for identical warrants to purchase Random Source common stock which were held by the warrant holders immediately prior to closing. The expiration date of each Exchange Warrant is identical to the Random Source warrant for which it was exchanged. The exercise price of the Exchange Warrants and the number of shares issuable upon the exercise of the warrants are subject to proportional adjustment in the event of stock splits, dividends, recapitalizations or similar transactions. Warrants to purchase 678,571 shares of the Company s common stock with an exercise price of $0.07 per share are exercisable on a cashless basis. Warrants to purchase an additional 14,397,000 shares of the Company s common stock with exercise prices ranging from $0.15 to $0.50 per share are callable by us, upon 30 days notice, at a call price of $0.001 per share if the Company s stock is currently quoted for trading in the over the counter market, the closing price of the Company s common stock equals or exceeds certain base thresholds for five consecutive trading days and there is an effective registration statement covering the resale of the shares of common stock underlying those Exchange Warrants. This means that holders of these Exchange Warrants will have 30 days from the date the warrants are called to exercise the Exchange Warrants. Any warrant which has been called but remains unexercised by the call date will automatically terminate and no longer entitle the holder to exercise such warrant or to receive any consideration therefore, other than the call price.
+
+Contemporaneously on the date of the Merger, on May 7, 2012 Random Source also entered into a Stock Repurchase Agreement (the Stock Repurchase Agreement ) with the then majority shareholders of the Company pursuant to which Random Source purchased 1,700,000 shares of the Company s common stock (the Insiders Shares ) for $304,000. The purchase price was paid by $250,000 at closing and delivery of a 90 day secured promissory note in the principal amount of $54,000. Such 1,700,000 shares were cancelled on the date of the Merger. In order to secure the timely payment of the Purchase Note, at closing the Company issued 2,000,000 shares of the Company s common stock which such shares will be held by in escrow pursuant to the terms of the Escrow Agreement between the parties. Following the payment of the Purchase Note, the 2,000,000 shares of common stock which had been placed in escrow to secure the timely payment of the note were returned to the Company and have been cancelled and returned to the status of authorized but unissued shares (see Note 6).
+
+ 
+
+ 
+
+F-13
+
+ 
+
+NOTE 7 STOCKHOLDERS EQUITY (continued)
+
+In January 2012, the Company had issued 4,200,000 shares of common stock in connection with a 3 year consulting and advisory agreement (see Note 9). The Company had valued these common shares at the fair market value on the date of grant at $0.07 or $294,000 which shall be amortized pursuant to the terms of the consulting agreement. The Company had recognized stock-based consulting expense of $24,500 in January 2012. The consultant did not achieve its minimum financing requirement thereby the Company terminated such agreement and re-purchased the 4,200,000 shares of common stock for $20,000 pursuant to such agreement. As a result, the Company cancelled these 4,200,000 shares and the Company reduced stock-based consulting expense by $24,500. The amendment and termination agreement where administratively issued in July 2012.
+
+ 
+
+Between April 30, 2012 and May 4, 2012 the Company sold in aggregate 6,785,714 shares of the Company s common stock at $0.07 per share in a private placement which resulted in gross proceeds to us of $475,000. The Company paid private placement commissions or finder s fees in cash for $56,750 (net of $12,500 of creditable retainer fee see Note 9) and a five year 678,571 warrants to purchase the Company s common stock in connection with this transaction. The Company also paid related private placement fees of $3,250. The Company used the net proceeds to pay off a $25,000 loan to a related party (see Note 8) and as payment of a purchase price in connection with a Stock Repurchase Agreement on May 7, 2011.
+
+Between June 29, 2012 and July 30, 2012, the Company sold in aggregate 1,428,571 shares of the Company s common stock at $0.07 per share in a private placement which resulted in gross proceeds to us of $100,000. The Company paid the placement agent a commission in cash $10,000 and a non-accountable expense allowance of $2,000 in connection with this transaction. The Company also paid related private placement fees of $8,026, including escrow agent and legal fees. As additional compensation, the Company issued the placement agent placement agent warrants to purchase 142,858 shares of common stock with an exercise price of $0.07 per share in connection with this transaction. Such warrants expire five years from the date of issuance.
+
+In August 2012, the Company cancelled 500,000 shares of the Company s common stock. In connection with the return of the 500,000 shares, the Company valued these cancelled common shares at par value against additional paid in capital.
+
+Common Stock Options
+
+Information related to options granted under the 2010 Equity Compensation Plan and activity for the period then ended is as follows:
+
+ 
+
+ 
+ 
+
+Number of
+
+Options
+
+ 
+ 
+
+Weighted Average Exercise Price
+
+ 
+ 
+
+Weighted
+
+Average
+
+Remaining Contractual
+
+Life (Years)
+
+ 
+
+Balance at December 31, 2011
+
+ 
+ 
+180,000
+ 
+ 
+$
+0.10
+ 
+ 
+ 
+3.42
+ 
+
+Granted
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Exercised
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Forfeited
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Cancelled
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Balance outstanding at September 30, 2012
+
+ 
+ 
+180,000
+ 
+ 
+$
+0.10
+ 
+ 
+ 
+2.92
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Options exercisable at end of year
+
+ 
+ 
+-
+ 
+ 
+$
+-
+ 
+ 
+ 
+ 
+ 
+
+Options expected to vest
+
+ 
+ 
+180,000
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Weighted average fair value of options granted during the period
+
+ 
+ 
+ 
+ 
+ 
+$
+-
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Stock options outstanding at September 30, 2012 as disclosed in the above table have no intrinsic value at the end of the period.
+
+ 
+
+ 
+
+F-14
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 7 STOCKHOLDERS EQUITY (continued)
+
+Common Stock Warrants
+
+A summary of the status of the Company's outstanding stock warrants and changes during the period then ended is as follows:
+
+ 
+
+ 
+
+Number of
+
+Warrants
+
+ 
+ 
+
+Weighted Average Exercise Price
+
+ 
+ 
+
+Weighted
+
+Average
+
+Remaining Contractual
+
+Life (Years)
+
+ 
+
+Balance at December 31, 2011
+
+ 
+ 
+14,397,000
+ 
+ 
+$
+0.30
+ 
+ 
+ 
+2.25
+ 
+
+Granted
+
+ 
+ 
+821,429
+ 
+ 
+ 
+0.07
+ 
+ 
+ 
+5.00
+ 
+
+Cancelled
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Forfeited
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Exercised
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Balance at September 30, 2012
+
+ 
+ 
+15,218,429
+ 
+ 
+$
+0.29
+ 
+ 
+ 
+1.70
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Warrants exercisable at September 30, 2012
+
+ 
+ 
+15,218,429
+ 
+ 
+$
+0.29
+ 
+ 
+ 
+1.70
+ 
+
+Weighted average fair value of warrants granted during the period
+
+ 
+ 
+ 
+ 
+ 
+$
+0.07
+ 
+ 
+ 
+ 
+ 
+
+NOTE 8 RELATED PARTY TRANSACTIONS
+
+Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions.
+
+From time to time the Company also enters into transactions with Computer Nerds International, Inc. ( Computer Nerds ), a company owned by certain of the Company s Officers, including:
+
+ 
+
+ 
+
+The Company purchased inventories and products for sale from Computer Nerds totaling approximately $7,700,000 and $86,000 during the nine months ended September 30, 2012 and 2011, respectively. The Company s sales to Computer Nerds totaling approximately $2,200 and $0 during the nine months ended September 30, 2012 and 2011, respectively. Accounts payable to Computer Nerds as of September 30, 2012 and December 31, 2011, was $328,488 and $300,939, respectively, and were reflected as accounts payable related party in the accompanying consolidated balance sheets.
+
+Additionally, on October 25, 2011, the Company, through its subsidiary, Superwarehouse, entered into a Distribution Agreement (the Computer Nerds Agreement ) with Computer Nerds whereby the Company appoints Computer Nerds as its non-exclusive distributor of the Company s products in order to market, promote, distribute, and sell the product to its customers, directly or indirectly and shall include all products, territories, geographies, customers and markets without restriction. The initial term of the Computer Nerds Agreement began on October 25, 2011 and shall end on December 31, 2012. The term shall automatically renew for a one year period on each subsequent anniversary date of the effective date. The Company may give written notice of its intent to terminate this agreement at anytime. Pursuant to the Computer Nerds Agreement, Computer Nerds agrees to charge the Company its cost plus 2% distributor fee.
+
+ 
+
+ 
+
+F-15
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 8 RELATED PARTY TRANSACTIONS (continued)
+
+On July 30, 2012, the Company, through its subsidiary, Superwarehouse, entered into an Amended Distribution Agreement (the Amended Agreement ) with Computer Nerds whereby the Company extended the term up to March 31, 2013. Pursuant to the Amended Agreement, effective August 1, 2012, the distributor fee will be lowered to 1.5% from 2%. All other terms and conditions of the original agreement remain in full force and effect. The Company paid approximately $142,000 of the distributor fee during the nine months ended September 30, 2012.
+
+In October 2011, the Company issued promissory notes to three officers of the Company in an aggregate amount of $150,000. The notes were due in January 2012 and bore interest at a rate of 18% per annum. Accrued interest as of December 31, 2011, amounted to $6,505. Between January 2012 and February 2012, the Company paid off the principal and accrued interest from such promissory notes.
+
+On February 15, 2012, the Company issued a promissory note to a related party, who is a shareholder of the Company, for $25,000. The note bears an annual interest rate of 6% per annum. The principal amount together with accrued interest will be due on the closing date of the Company s financing pursuant to its February 2012 Private Placement Memorandum. On April 30, 2012, the Company paid off the principal and accrued interest from such promissory note.
+
+ 
+
+NOTE 9 COMMITMENTS AND CONTINGENCIES
+
+Consulting Contracts
+
+In December 2011, the Company entered into a 6 month investment banking and financial advisor agreement with a broker-dealer who is a member of FINRA pursuant to which it agreed to act as an exclusive investment banking consultant (the Consultant ) for the Company. The Company shall pay the Consultant 10% of gross proceeds raised from a private placement financings and warrants to purchase shares of the Company s common stock equal to 10% of the number of shares sold from such private placement financings. The Company shall pay a $25,000 retainer fee for its services whereby $12,500 of the retainer fee shall be creditable against cash commissions payable to such Consultant. Between December 2011 and February 2012, the Company paid the $25,000 retainer.
+
+Additionally, in December 2011, the Company had entered into a consulting and advisory agreement with the same Consultant (see above) which term is from the date of this agreement through the 3 year anniversary of the final closing of the financing of the Company s convertible promissory note as defined in the agreement. The Company shall pay $5,000 commencing on the month following the initial closing of the financing. In January 2012, the Company had issued 4,200,000 shares of the Company s common stock pursuant to the terms of the consulting agreement (see Note 7). The 4,200,000 shares were subject to a re-purchase in the event that there has been no closing of the financing after 1 year pursuant to this agreement. The Consultant did not achieve its minimum financing requirement thereby the Company terminated such agreement and the Company re-purchased the 4,200,000 shares of common stock for $20,000 pursuant to such agreement. As a result, the Company cancelled these 4,200,000 shares. The amendment and termination agreement where administratively issued in July 2012. In July 2012, the Company entered into a 3 year non-exclusive investment banking and financial advisor agreement with the same Consultant pursuant to which it agreed to act as an investment banking and financial advisor consultant for the Company. The Company shall pay the Consultant 10% of gross proceeds raised from the closing of financings and five year warrants to purchase shares of the Company s common stock equal to 10% of the number of shares sold from such financings. The Company shall reimburse such Consultant its actual and pre-approved out of pocket expenses. Additionally, in July 2012, the Company entered into a subscription agreement with an affiliate of the Consultant whereby the Company sold 1,000,000 shares of the Company s common stock for $1,000.
+
+ 
+
+ 
+
+F-16
+
+ 
+
+ 
+
+PROGUARD ACQUISITION CORP. AND SUBSIDIARIES
+
+NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+September 30, 2012
+
+ 
+
+NOTE 9 COMMITMENTS AND CONTINGENCIES (continued)
+
+ 
+
+In July 2011, the Company entered into a 4 year Rebate Agreement (the Rebate Agreement ) with a distributor. The Company received a one-time advance rebate allowance of $375,000 and marketing allowance of $25,000 whereby the Company will purchase at least 90% of the Company s monthly purchase requirements of products for sale from such distributor. Pursuant to the Rebate Agreement, the Company is eligible to receive volume cash discount, volume flat rebates, marketing rebate and annual growth rebates as defined in the Rebate Agreement. The allowance is subject to a repayment claw back provision upon the occurrence of either (i) the acquisition of the Company by a third party including the sale of all or substantially all of the Company s equity or assets, a merger, or transaction resulting in a change of control or (ii) the Company does not honor its purchase commitments for 2 or 3 consecutive months in a 12 month period. If a repayment claw back occurs, the Company shall pay back the unearned portion of any discounts, rebates and allowances paid by the distributor. The Company recorded the advance rebate and marketing allowance as deferred discount as reflected in the accompanying consolidated balance sheets. The Company amortizes the advance rebate to cost of sales and amortizes the advance marketing allowance to expense over the term of the Rebate Agreement. Deferred discount- short term at September 30, 2012 and December 31, 2011 was $100,000 and will be amortized within a year. Deferred discount- long term at September 30, 2012 and December 31, 2011 was $175,000 and $250,000, respectively, and will be amortized over the remaining term of the agreement beyond one year period.
+
+Operating Lease
+
+A lease agreement was signed for office and warehousing space located in Broward County, Florida with an initial term commencing on June 1, 2011 and expiring on July 31, 2014. Such office space consists of approximately 6,962 square feet and serves as the corporate headquarters of the Company and its subsidiary, Hinson Office Supply. There are no minimum, contingent or sublease arrangements in the lease. Future minimum rental payments required under this operating lease are as follows:
+
+ 
+
+ 
+
+ 
+
+Period ending December 31, 2012 
+
+$13,141
+
+ 
+
+Period ending December 31, 2013
+
+$53,027
+
+ 
+
+Thereafter 
+
+$31,311
+
+Included in the lease is a $10,345 credit against rent due for work performed by the Company for leasehold improvements to office and warehousing space. This is not reflected in the numbers above.
+
+In September 2012, the Company entered into a lease agreement for an office and warehousing space located in San Diego, California for a period of 12 months which will serve as the headquarters of the Company s subsidiary, Superwarehouse. The term shall commence on October 1, 2012 and ends on September 30, 2013. The monthly base rent shall be $963. Future minimum rental payments required under this operating lease are as follows:
+
+ 
+
+ 
+
+Period ending December 31, 2012 
+
+$2,889
+
+ 
+
+ 
+
+Period ending December 31, 2013
+
+$8,667
+
+ 
+
+Rent expense was $73,266 and $24,633 for the nine months ended September 30, 2012 and 2011, respectively.
+
+ 
+
+ 
+
+F-17
+
+ 
+
+ 
+
+REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
+
+ 
+
+To the Board of Directors
+
+Random Source, Inc.
+
+ 
+
+We have audited the accompanying consolidated balance sheets of Random Source, Inc. and Subsidiaries as of December 31, 2011 and 2010 and the related consolidated statements of operations, changes in stockholders equity (deficit), and cash flows for the years ended December 31, 2011 and 2010. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
+
+ 
+
+We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
+
+ 
+
+ In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Random Source, Inc. and Subsidiaries as of December 31, 2011 and 2010, and the results of its operations and its cash flows for the years ended December 31, 2011 and 2010 in conformity with accounting principles generally accepted in the United States of America.
+
+ 
+
+ 
+/s/
+Sherb & Co., LLP
+
+ 
+ 
+Certified Public Accountants
+
+ 
+
+Boca Raton, Florida
+
+April 16, 2012
+
+ 
+
+F-18
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+CONSOLIDATED BALANCE SHEETS
+
+ 
+
+ 
+ 
+
+December 31,
+
+ 
+
+ 
+ 
+
+2011
+
+ 
+ 
+
+2010
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ASSETS
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Current assets:
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Cash
+
+ 
+$
+277,857
+ 
+ 
+$
+42,099
+ 
+
+ Accounts receivable - net
+
+ 
+ 
+361,325
+ 
+ 
+ 
+124,397
+ 
+
+ Inventory
+
+ 
+ 
+9,020
+ 
+ 
+ 
+-
+ 
+
+ Other receivables
+
+ 
+ 
+12,444
+ 
+ 
+ 
+-
+ 
+
+ Due from related party
+
+ 
+ 
+2,691
+ 
+ 
+ 
+-
+ 
+
+ Prepaid expenses and other current assets
+
+ 
+ 
+73,097
+ 
+ 
+ 
+12,936
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Total current assets
+
+ 
+ 
+736,434
+ 
+ 
+ 
+179,432
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Other assets:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Property and equipment, net
+
+ 
+ 
+31,302
+ 
+ 
+ 
+643
+ 
+
+ Intangible asset, net
+
+ 
+ 
+861,747
+ 
+ 
+ 
+-
+ 
+
+ Deposits
+
+ 
+ 
+49,673
+ 
+ 
+ 
+710
+ 
+
+ Total other assets
+
+ 
+ 
+942,722
+ 
+ 
+ 
+1,353
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Total assets
+
+ 
+$
+1,679,156
+ 
+ 
+$
+180,785
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Current liabilities:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Accounts payable and accrued liabilities
+
+ 
+$
+487,460
+ 
+ 
+$
+144,196
+ 
+
+ Accounts payable - related party
+
+ 
+ 
+300,939
+ 
+ 
+ 
+4,180
+ 
+
+ Notes payable - short term
+
+ 
+ 
+55,681
+ 
+ 
+ 
+-
+ 
+
+ Deferred discount - short term
+
+ 
+ 
+100,000
+ 
+ 
+ 
+-
+ 
+
+ Customer deposits
+
+ 
+ 
+15,285
+ 
+ 
+ 
+-
+ 
+
+ Due to related parties
+
+ 
+ 
+156,505
+ 
+ 
+ 
+39,329
+ 
+
+ Total current liabilities
+
+ 
+ 
+1,115,870
+ 
+ 
+ 
+187,705
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+LONG-TERM LIABILITIES:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Notes payable - long term
+
+ 
+ 
+64,558
+ 
+ 
+ 
+-
+ 
+
+ Deferred discount - long term
+
+ 
+ 
+250,000
+ 
+ 
+ 
+-
+ 
+
+ Total liabilities
+
+ 
+ 
+1,430,428
+ 
+ 
+ 
+187,705
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Stockholders' equity (deficit):
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Preferred stock, $0.001 par value, 10,000,000 shares
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ authorized: no shares issued and outstanding
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+Common stock, $0.001 par value, 500,000,000 shares
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ authorized: 117,003,803 shares and 100,200,000 shares
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ issued and outstanding at December 31, 2011 and 2010, respectively
+
+ 
+ 
+117,004
+ 
+ 
+ 
+100,200
+ 
+
+Additional paid-in capital
+
+ 
+ 
+1,103,046
+ 
+ 
+ 
+439,950
+ 
+
+Accumulated deficit
+
+ 
+ 
+(971,322
+)
+ 
+ 
+(546,870
+)
+
+Subscription receivable
+
+ 
+ 
+-
+ 
+ 
+ 
+(200
+)
+
+ Total stockholders' equity (deficit)
+
+ 
+ 
+248,728
+ 
+ 
+ 
+(6,920
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Total liabilities and stockholders' equity (deficit)
+
+ 
+$
+1,679,156
+ 
+ 
+$
+180,785
+ 
+
+ 
+
+See accompanying notes to consolidated financial statements.
+
+ 
+
+ 
+
+ 
+
+ 
+
+F-19
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+CONSOLIDATED STATEMENTS OF OPERATIONS
+
+ 
+
+ 
+ 
+
+FOR THE YEAR
+
+ 
+ 
+
+FOR THE YEAR
+
+ 
+
+ 
+ 
+
+ENDED
+
+ 
+ 
+
+ENDED
+
+ 
+
+ 
+ 
+
+DECEMBER 31, 2011
+
+ 
+ 
+
+DECEMBER 31, 2010
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net sales
+
+ 
+$
+6,070,158
+ 
+ 
+$
+1,486,638
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cost of sales
+
+ 
+ 
+5,104,595
+ 
+ 
+ 
+1,242,887
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Gross profit
+
+ 
+ 
+965,563
+ 
+ 
+ 
+243,751
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Operating expenses:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Depreciation and amortization
+
+ 
+ 
+138,803
+ 
+ 
+ 
+13,979
+ 
+
+ Marketing, selling and advertising expenses
+
+ 
+ 
+56,909
+ 
+ 
+ 
+16,208
+ 
+
+ Compensation and related taxes
+
+ 
+ 
+567,088
+ 
+ 
+ 
+121,753
+ 
+
+ Professional and consulting fees
+
+ 
+ 
+365,301
+ 
+ 
+ 
+160,821
+ 
+
+ General and administrative
+
+ 
+ 
+255,682
+ 
+ 
+ 
+68,071
+ 
+
+ Total operating expenses
+
+ 
+ 
+1,383,783
+ 
+ 
+ 
+380,832
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Loss from operations
+
+ 
+ 
+(418,220
+)
+ 
+ 
+(137,081
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Other expense
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Other expense
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+ Interest expense
+
+ 
+ 
+(6,922
+)
+ 
+ 
+-
+ 
+
+ Interest income
+
+ 
+ 
+690
+ 
+ 
+ 
+269
+ 
+
+ Total other expense
+
+ 
+ 
+(6,232
+)
+ 
+ 
+269
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Loss before provision for income taxes
+
+ 
+ 
+(424,452
+)
+ 
+ 
+(136,812
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Provision for income taxes
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net loss
+
+ 
+$
+(424,452
+)
+ 
+$
+(136,812
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+WEIGHTED AVERAGE COMMON SHARES
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Basic and Diluted
+
+ 
+ 
+112,855,550
+ 
+ 
+ 
+97,635,068
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+NET LOSS PER COMMON SHARE:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ OUTSTANDING - Basic and Diluted
+
+ 
+ 
+(0.00
+)
+ 
+ 
+(0.00
+)
+
+ 
+
+See accompanying notes to consolidated financial statements.
+
+ 
+
+ 
+
+ 
+
+F-20
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
+
+FOR THE YEAR ENDED DECEMBER 31, 2011 AND 2010
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Total
+
+ 
+
+ 
+ 
+
+Preferred Stock
+
+ 
+ 
+
+Common Stock
+
+ 
+ 
+
+Additional
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Stockholders'
+
+ 
+
+ 
+ 
+
+$0.001 Par Value
+
+ 
+ 
+
+$0.001 Par Value
+
+ 
+ 
+
+Paid-in
+
+ 
+ 
+
+Accumulated
+
+ 
+ 
+
+Subscription
+
+ 
+ 
+
+Equity
+
+ 
+
+ 
+ 
+
+Shares
+
+ 
+ 
+
+Amount
+
+ 
+ 
+
+Shares
+
+ 
+ 
+
+Amount
+
+ 
+ 
+
+Capital
+
+ 
+ 
+
+Deficit
+
+ 
+ 
+
+receivable
+
+ 
+ 
+
+(Deficit)
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Balance at December 31, 2009
+
+ 
+ 
+-
+ 
+ 
+$
+-
+ 
+ 
+ 
+94,000,000
+ 
+ 
+$
+94,000
+ 
+ 
+$
+426,000
+ 
+ 
+$
+(410,058
+)
+ 
+$
+(2,000
+)
+ 
+$
+107,942
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Sale of common stock
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+6,000,000
+ 
+ 
+ 
+6,000
+ 
+ 
+ 
+13,500
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+19,500
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Common stock issued for services
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+200,000
+ 
+ 
+ 
+200
+ 
+ 
+ 
+450
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+650
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Collection of subscription receivable
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+1,800
+ 
+ 
+ 
+1,800
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net loss for the year ended December 31, 2010
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+(136,812
+)
+ 
+ 
+-
+ 
+ 
+ 
+(136,812
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Balance at December 31, 2010
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+100,200,000
+ 
+ 
+ 
+100,200
+ 
+ 
+ 
+439,950
+ 
+ 
+ 
+(546,870
+)
+ 
+ 
+(200
+)
+ 
+ 
+(6,920
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Sale of common stock
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+16,803,803
+ 
+ 
+ 
+16,804
+ 
+ 
+ 
+663,096
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+679,900
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Collection of subscription receivable
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+200
+ 
+ 
+ 
+200
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net loss for the year ended December 31, 2011
+
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+-
+ 
+ 
+ 
+(424,452
+)
+ 
+ 
+-
+ 
+ 
+ 
+(424,452
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Balance at December 31, 2011
+
+ 
+ 
+-
+ 
+ 
+$
+-
+ 
+ 
+ 
+117,003,803
+ 
+ 
+$
+117,004
+ 
+ 
+$
+1,103,046
+ 
+ 
+$
+(971,322
+)
+ 
+$
+-
+ 
+ 
+$
+248,728
+ 
+
+ 
+
+See accompanying notes to consolidated financial statements.
+
+ 
+
+ 
+
+ 
+
+F-21
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+CONSOLIDATED STATEMENTS OF CASH FLOWS
+
+ 
+
+ 
+ 
+
+FOR THE YEAR
+
+ 
+ 
+
+FOR THE YEAR
+
+ 
+
+ 
+ 
+
+ENDED
+
+ 
+ 
+
+ENDED
+
+ 
+
+ 
+ 
+
+DECEMBER 31, 2011
+
+ 
+ 
+
+DECEMBER 31, 2010
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash flows from operating activities:
+
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+Net loss
+
+ 
+$
+(424,452
+)
+ 
+$
+(136,812
+)
+
+ Adjustments to reconcile net loss to net provided by (cash used) in operating activities:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Common stock issued for services
+
+ 
+ 
+-
+ 
+ 
+ 
+650
+ 
+
+Depreciation and amortization
+
+ 
+ 
+138,770
+ 
+ 
+ 
+13,979
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Changes in operating assets and liabilities
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Accounts receivable
+
+ 
+ 
+(236,928
+)
+ 
+ 
+(8,591
+)
+
+ Inventory
+
+ 
+ 
+(9,020
+)
+ 
+ 
+-
+ 
+
+ Other receivables
+
+ 
+ 
+(12,444
+)
+ 
+ 
+-
+ 
+
+ Due from related party
+
+ 
+ 
+(2,691
+)
+ 
+ 
+-
+ 
+
+ Prepaid expenses and other current assets
+
+ 
+ 
+(57,097
+)
+ 
+ 
+(7,303
+)
+
+ Deposits
+
+ 
+ 
+(48,963
+)
+ 
+ 
+-
+ 
+
+ Accounts payable and accrued liabilities
+
+ 
+ 
+343,297
+ 
+ 
+ 
+53,009
+ 
+
+ Accounts payable - related party
+
+ 
+ 
+296,759
+ 
+ 
+ 
+-
+ 
+
+ Deferred discount - short term
+
+ 
+ 
+100,000
+ 
+ 
+ 
+-
+ 
+
+ Customer deposits
+
+ 
+ 
+15,285
+ 
+ 
+ 
+-
+ 
+
+ Deferred discount - long term
+
+ 
+ 
+250,000
+ 
+ 
+ 
+-
+ 
+
+ Net cash provided by (used in) operating activities
+
+ 
+ 
+352,516
+ 
+ 
+ 
+(85,068
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash flows from investing activities:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Cash used in acquisition of business
+
+ 
+ 
+(850,000
+)
+ 
+ 
+-
+ 
+
+ Purchase of property and equipment
+
+ 
+ 
+(22,273
+)
+ 
+ 
+-
+ 
+
+ Net cash provided by (used in) investing activities
+
+ 
+ 
+(872,273
+)
+ 
+ 
+-
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash flows from financing activities:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Payments on notes payable
+
+ 
+ 
+(41,761
+)
+ 
+ 
+-
+ 
+
+ Proceeds from related party advances, net of
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ repayments on related party advances
+
+ 
+ 
+117,176
+ 
+ 
+ 
+1,710
+ 
+
+ Collection of subscription receivable
+
+ 
+ 
+200
+ 
+ 
+ 
+1,800
+ 
+
+ Proceeds from sale of common stock
+
+ 
+ 
+679,900
+ 
+ 
+ 
+19,500
+ 
+
+ Net cash provided by financing activities
+
+ 
+ 
+755,515
+ 
+ 
+ 
+23,010
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net increase in cash
+
+ 
+ 
+235,758
+ 
+ 
+ 
+(62,058
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash at beginning of year
+
+ 
+ 
+42,099
+ 
+ 
+ 
+104,157
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Cash at end of year
+
+ 
+$
+277,857
+ 
+ 
+$
+42,099
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Cash paid for:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Interest
+
+ 
+$
+2,128
+ 
+ 
+$
+-
+ 
+
+ Income taxes
+
+ 
+$
+-
+ 
+ 
+$
+-
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Issuance of notes payable in connection with the acquisition of business
+
+ 
+$
+162,000
+ 
+ 
+$
+-
+ 
+
+ Value of intangible assets upon acquisition of business
+
+ 
+$
+991,265
+ 
+ 
+$
+-
+ 
+
+ Purchase of property and equipment upon acquisition of business
+
+ 
+$
+17,671
+ 
+ 
+$
+-
+ 
+
+ Purchase of other current assets upon acquisition of business
+
+ 
+$
+3,064
+ 
+ 
+$
+-
+ 
+
+ 
+
+See accompanying notes to consolidated financial statements.
+
+ 
+
+ 
+
+F-22
+
+ 
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
+
+ 
+
+Organization
+
+ 
+
+Random Source Inc. (the Company ) was incorporated under the laws of the State of Florida in September 2008. The Company operates and sells office supplies such as high-quality, brand-name office products primarily to medium and large-sized businesses through its retail websites. The Company carries a wide selection of merchandise, including general office supplies, business machines and computers, office furniture, and other business-related products.
+
+ 
+
+On March 9, 2011, the Company acquired 100% of the outstanding stock of Lamfis, Inc. ( Lamfis ) which does business as Hinson Office Supply for $262,000. Lamfis was incorporated under the laws of the State of Florida in May 1991. Lamfis operates as a company that sells through our retail websites, office supplies and office products primarily to school districts and government agencies located in the State of Florida primarily in Broward and Miami-Dade counties.
+
+ 
+
+A newly-formed wholly-owned subsidiary, Superwarehouse Business Products Inc. ( Superwarehouse ), a Florida corporation was formed on September 22, 2011. Following the formation of Superwarehouse, in October 2011, the Company acquired the business and assets of Superwarehouse Enterprises, Inc. ( SWH, Inc. ) and Superwarehouse Gov, LLC ( SWH GOV ) under an Article 9 foreclosure sale initiated by their major and senior creditor pursuant to a bill of sale agreement. The purchase price was for $750,000. SWH, Inc. and SWH GOV were in the business of selling office supplies and office products primarily to medium and large-sized businesses through retail websites. The fair value of all the assets acquired was adjusted directly on the financial statements of the Company's subsidiary, Superwarehouse.
+
+ 
+
+Basis of Presentation
+
+ 
+
+The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America ( US GAAP ). The consolidated financial statements of the Company include the Company and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation.
+
+ 
+
+Use of Estimates and Assumptions
+
+ 
+
+The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made by management include, but are not limited to, the allowance for bad debts, the useful life of property and equipment, and useful life of intangible assets.
+
+ 
+
+FASB Accounting Standards Codification
+
+ 
+
+The issuance by Financial Accounting Standards Board ( FASB ) of the Accounting Standards Codification ( ASC ) on July 1, 2009 (effective for interim or annual reporting periods ending after September 15, 2009), changes the way that GAAP is referenced. Beginning on that date, ASC officially became the single source of authoritative nongovernmental GAAP; however, SEC registrants must also consider rules, regulations, and interpretive guidance issued by the SEC or its staff. The change affects the way the Company refers to GAAP in financial statements and in its accounting policies. All existing standards that were used to create ASC became superseded. Instead, references to standards consist solely of the number used in the ASC s structural organization.
+
+ 
+
+F-23
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Fair Value of Financial Instruments
+
+ 
+
+The Company adopted FASB ASC 820, Fair Value Measurements and Disclosures , for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing US GAAP that require the use of fair value measurements which establishes a framework for measuring fair value and expands disclosure about such fair value measurements. 
+
+ 
+
+ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below:
+
+ 
+
+ 
+
+Level 1:
+
+Observable inputs such as quoted market prices in active markets for identical assets or liabilities
+
+ 
+
+Level 2:
+
+Observable market-based inputs or unobservable inputs that are corroborated by market data
+
+ 
+
+Level 3:
+
+Unobservable inputs for which there is little or no market data, which require the use of the reporting entity s own assumptions.
+
+ 
+
+The carrying amounts reported in the balance sheet for accounts receivable, other receivables, prepaid expenses, accounts payable, accrued liabilities, and customer deposits approximate their estimated fair market value based on the short-term maturity of these instruments.
+
+ 
+
+In addition, FASB ASC 825-10-25 Fair Value Option was effective for January 1, 2008. ASC 825-10-25 expands opportunities to use fair value measurements in financial reporting and permits entities to choose to measure many financial instruments and certain other items at fair value.
+
+ 
+
+Cash and Cash Equivalents
+
+ 
+
+The Company considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents. The Company places its cash with a high credit quality financial institution. The Company account at this institution is insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. In addition to the basic insurance deposit coverage, the FDIC is providing temporary unlimited coverage for non-interest bearing transaction accounts through December 31, 2012. At December 31, 2011, the Company has not reached bank balances exceeding the FDIC insurance limit on interest bearing accounts. To reduce its risk associated with the failure of such financial institution, the Company evaluates at least annually the rating of the financial institution in which it holds deposits.
+
+ 
+
+Segments
+
+ 
+
+The Company s activities are within the office products and office supplies retail industry, which is the single industry segment the Company operates. Each operating subsidiary represents an operating segment and these segments have been aggregated, as the operating units meet all of the aggregation criteria. The Company has aggregated its operating segments based on the aggregation criteria outlined in ASC 280-10, which states that two or more operating segments may be aggregated into a single operating segment if aggregation is consistent with the objective and basic principles of the Statement, if the segments have similar economic characteristics, similar product, similar production processes, similar customers and similar methods of distribution. Therefore, the Company has a single operating segment for financial reporting purposes.
+
+ 
+
+F-24
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Revenue Recognition
+
+ 
+
+The Company follows the guidance of the FASB ASC 605-10-S99 Revenue Recognition Overall SEC Materials . The Company records revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. Revenues consist primarily of product sales.
+
+ 
+
+Accounts Receivable
+
+ 
+
+The Company has a policy of reserving for questionable accounts based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to the bad debt expense after all means of collection have been exhausted and the potential for recovery is considered remote. As of December 31, 2011 and 2010, our allowance for doubtful accounts totaled $4,300 and $4,300, respectively. The Company did not consider it necessary to record any bad debt expense during the years ended December 31, 2011 and 2010.
+
+ 
+
+Inventory
+
+ 
+
+Inventory, consisting of finished goods related to the Company s products are stated at the lower of cost or market utilizing the first-in, first-out method.
+
+ 
+
+Concentrations of Credit Risk and Major Customers
+
+ 
+
+Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash and trade accounts receivable. The Company places its cash with high credit quality financial institutions. Most of the Company s sales are credit sales which are primarily to customers whose ability to pay is dependent upon the industry economics prevailing in these areas; however, concentrations of credit risk with respect to trade accounts receivables is limited due to generally short payment terms. The Company also performs ongoing credit evaluations of its customers to help further reduce credit risk.
+
+ 
+
+As of December 31, 2011, 8 customers accounted for 15% of total accounts receivable. As of December 31, 2010, 5 customers accounted for 27% of total accounts receivable. No single customer accounted for greater than 10% of sales of the Company for the years ended December 31, 2011 and 2010.
+
+ 
+
+Prepaid expenses and other current assets
+
+ 
+
+Prepaid expenses and other current assets of $73,097 and $12,936 at December 31, 2011 and 2010, respectively, consist primarily of costs paid for future services which will occur within a year. Prepaid expenses include prepayments in cash for web marketing services, computer support services, consulting and business advisory services, and prepaid insurance which are being amortized over the terms of their respective agreements.
+
+ 
+
+Customer Deposit
+
+Customer deposits at December 31, 2011 and 2010 were $15,285 and $0, respectively, which consist of prepayments from third party customers to the Company and customer refunds. The Company will recognize the prepayments as revenue upon delivery of the products, in compliance with its revenue recognition policy.
+
+ 
+
+F-25
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Marketing, selling and advertising costs
+
+ 
+
+Marketing, selling and advertising costs are expensed as incurred. Such expenses for the years ended December 31, 2011 and 2010 totaled $56,909 and $16,208, respectively.
+
+ 
+
+Income Taxes
+
+ 
+
+Income taxes are accounted for under the asset and liability method in accordance with ASC 740, Income Taxes . Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial carrying amounts of existing assets and liabilities and their respective tax bases as well as operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance to the extent that the recoverability of the asset is unlikely to be recognized.
+
+ 
+
+The Company follows ASC 740 rules governing uncertain tax positions, which provides guidance for recognition and measurement. This prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognization, classification and disclosure of these uncertain tax positions.
+
+ 
+
+Basic and Diluted Net Loss per Share
+
+ 
+
+Net loss per common share is calculated in accordance with ASC Topic 260: Earnings Per Share ( ASC 260 ). Basic loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. The computation of diluted net loss per share does not include dilutive common stock equivalents in the weighted average shares outstanding as they would be anti-dilutive. At December 31, 2011, the Company has 180,000 outstanding options and 14,397,000 outstanding warrants. At December 31, 2010, the Company has 240,000 outstanding options.
+
+ 
+
+Property and equipment
+
+ 
+
+Property and equipment are carried at cost. The cost of repairs and maintenance is expensed as incurred; major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income in the year of disposition. Depreciation is calculated on a straight-line basis over the estimated useful life of the assets, generally two to seven years. Leasehold improvements are amortized on a straight-line basis over the shorter of the useful life of the improvement or the remaining term of the lease.
+
+ 
+
+Impairment of Long-lived Assets
+
+ 
+
+The Company accounts for the impairment or disposal of long-lived assets according to FASB ASC 360 Property, Plant and Equipment . ASC 360 clarifies the accounting for the impairment of long-lived assets and for long-lived assets to be disposed of, including the disposal of business segments and major lines of business. Long-lived assets are reviewed when facts and circumstances indicate that the carrying value of the asset may not be recoverable. When necessary, impaired assets are written down to estimated fair value based on the best information available. Estimated fair value is generally based on either appraised value or measured by discounting estimated future cash flows. Considerable management judgment is necessary to estimate discounted future cash flows. Accordingly, actual results could vary significantly from such estimates. The Company did not consider it necessary to record any impairment charges during the years ended December 31, 2011 and 2010.
+
+ 
+
+F-26
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Goodwill and Other Intangible Assets
+
+ 
+
+In accordance with ASC 350- 30-65 Goodwill and Other Intangible Assets , the Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following:
+
+ 
+
+1.
+
+Significant underperformance relative to expected historical or projected future operating results;
+
+ 
+
+2.
+
+Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and
+
+ 
+
+3.
+
+Significant negative industry or economic trends.
+
+When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. The Company did not consider it necessary to record any impairment charge on its intangible assets during the years ended December 31, 2011 and 2010.
+
+ 
+
+Employee Benefit Plan
+
+ 
+
+The Company offers a SIMPLE IRA plan which was established in December 2009 for all eligible employees. Employees meeting certain eligibility requirements can participate in the plan. Under the plan, the Company matches employee contributions to the plan up to 1% of the employee s salary. The Company made matching contributions of 1% totaling $1,441 and $1,622 during the years ended December 31, 2011 and 2010, respectively.
+
+ 
+
+Stock Based Compensation
+
+ 
+
+Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.
+
+ 
+
+Pursuant to ASC Topic 505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the measurement date. The expense is recognized over the vesting period of the award. Until the measurement date is reached, the total amount of compensation expense remains uncertain. The Company initially records compensation expense based on the fair value of the award at the reporting date.
+
+ 
+
+Related Parties
+
+ 
+
+Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions.
+
+ 
+
+ 
+
+F-27
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
+
+ 
+
+Recent Accounting Pronouncements
+
+ 
+
+In May 2011, FASB issued Accounting Standards Update ( ASU ) No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS ( ASU No. 2011-04 ). ASU No. 2011-04 provides guidance which is expected to result in common fair value measurement and disclosure requirements between U.S. GAAP and IFRS. It changes the wording used to describe many of the requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements. It is not intended for this update to result in a change in the application of the requirements in Topic 820. The amendments in ASU No. 2011-04 are to be applied prospectively. ASU No. 2011-04 is effective for public company for interim and annual periods beginning after December 15, 2011. Early application is not permitted. This update does not have a material impact on the Company s consolidated financial statements.
+
+ 
+
+In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income ( ASU No. 2011-05 ). In ASU No. 2011-05, an entity has the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income. The amendments in ASU No. 2011-05 do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. They also do not change the presentation of related tax effects, before related tax effects, or the portrayal or calculation of earnings per share. The amendments in ASU No. 2011-05 should be applied retrospectively. The amendment is effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. Early adoption is permitted, because compliance with the amendments is already permitted. The amendments do not require any transition disclosures. This update does not have a material impact on the Company s consolidated financial statements.
+
+ 
+
+In September 2011, the FASB issued ASU No. 2011-08, Intangibles Goodwill and Other (Topic 350) ( ASU No. 2011-08 ). In ASU No. 2011-08, an entity is permitted to make a qualitative assessment of whether it is more likely than not that a reporting unit s fair value is less than its carrying amount before applying the two-step goodwill impairment test. If an entity concludes that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it would not be required to perform the two-step impairment test for that reporting unit. The ASU s objective is to simplify how an entity tests goodwill for impairment. The amendments in ASU No. 2011-08 are effective for annual and interim goodwill and impairment tests performed for fiscal years beginning after December 15, 2011. Early adoption is permitted, including for annual and interim goodwill impairment tests performed as of a date before September 15, 2011, if an entity s financial statements for the most recent annual or interim period have not yet been issued. The Company are evaluating the requirements of ASU No. 2011-08 and have not yet determined whether a revised approach to evaluation of goodwill impairment will be used in future assessments. This update does not have a material impact on the Company s consolidated financial statements.
+
+ 
+
+On December 31, 2011, the FASB issued ASU No. 2011-11, Disclosures about Offsetting Assets and Liabilities , which requires new disclosures about balance sheet offsetting and related arrangements. For derivatives and financial assets and liabilities, the ASU requires disclosure of gross asset and liability amounts, amounts offset on the balance sheet, and amounts subject to the offsetting requirements but not offset on the balance sheet. The ASU is effective for annual reporting periods beginning on or after January 1, 2013. The Company is currently evaluating the impact, if any, that these updates will have on its financial condition, results of operations and cash flows. This update is not expected to have a material impact on the Company s consolidated financial statements.
+
+ 
+
+Other accounting standards that have been issued or proposed by the FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption.
+
+ 
+
+F-28
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 2 ACQUISITIONS
+
+ 
+
+Lamfis, Inc.
+
+ 
+
+On March 9, 2011, the Company acquired 100% of the outstanding stock of Lamfis which does business as Hinson Office Supply for $262,000. The stock purchase agreement calls for a $100,000 cash down payment with the balance of $162,000 payable in equal monthly installments of $4,640, fully amortized over thirty-six months with interest accruing at a rate of 2% per annum. Promissory Notes were issued to the former shareholders of Lamfis. The agreement calls for the last installment payment to be waived should the Company make all payments in a timely fashion.
+
+ 
+
+The Company accounted for the acquisition utilizing the purchase method of accounting in accordance with ASC 805 Business Combinations . The Company is the acquirer for accounting purposes and Lamfis is the acquired company. Accordingly, the Company applied push down accounting and adjusted to fair value all of the assets and liabilities directly on the financial statements of the subsidiary, Lamfis.
+
+ 
+
+The net purchase price, including acquisition costs paid by the Company, was allocated to assets acquired and liabilities assumed on the records of the Company as follows:
+
+Current assets
+
+ 
+
+$
+
+3,064
+
+ 
+
+Property and equipment 
+
+ 
+ 
+
+ 17,671
+
+ 
+
+Intangible asset
+
+ 
+ 
+
+241,265
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Net purchase price
+
+ 
+
+$
+
+262,000
+
+ 
+
+ 
+
+Unaudited pro forma results of operations data as if the Company and Lamfis had occurred as of January 1, 2010 are as follows:
+
+ 
+
+ 
+ 
+
+The Company and Lamfis
+
+For the year ended
+
+December 31, 2011
+
+ 
+ 
+
+The Company and Lamfis
+
+For the year ended
+
+December 31, 2010
+
+ 
+
+Pro forma revenues
+
+ 
+
+$
+
+6,505,163
+
+ 
+ 
+
+$
+
+4,399,276
+
+ 
+
+Pro forma loss from operations
+
+ 
+ 
+
+(418,835
+
+)
+
+ 
+ 
+
+(201,709
+
+)
+
+Pro forma net loss
+
+ 
+ 
+
+(425,757
+
+)
+
+ 
+ 
+
+(201,440
+
+)
+
+Pro forma loss per share
+
+ 
+
+$
+
+(0.00
+
+)
+
+ 
+
+$
+
+(0.00
+
+)
+
+Pro forma diluted loss per share
+
+ 
+
+$
+
+(0.00
+
+)
+
+ 
+
+$
+
+(0.00
+
+)
+
+ 
+
+Pro forma data does not purport to be indicative of the results that would have been obtained had these events actually occurred at January 1, 2010 and is not intended to be a projection of future results. 
+
+ 
+
+Superwarehouse Enterprises, Inc. and Superwarehouse GOV, LLC.
+
+ 
+
+Following the formation of the Company s wholly owned subsidiary, Superwarehouse, in October 2011, the Company acquired the business and assets of SWH, Inc. and SWH GOV (collectively SWH ) under an Article 9 foreclosure sale initiated by their major creditor pursuant to a bill of sale agreement. The purchase price was for $750,000.
+
+ 
+
+F-29
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 2 ACQUISITIONS (continued)
+
+ 
+
+The Company accounted for the acquisition utilizing the purchase method of accounting in accordance with ASC 805 Business Combinations . The Company is the acquirer for accounting purposes and SWH is the acquired company. Accordingly, the Company applied push down accounting and adjusted to fair value all of the assets acquired directly on the financial statements of the Company's subsidiary, Superwarehouse. The net purchase price, including acquisition costs paid by the Company, was allocated to assets acquired on the records of the Company as follows:
+
+Intangible asset
+
+ 
+
+$
+
+750,000
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Net purchase price
+
+ 
+
+$
+
+750,000
+
+ 
+
+ 
+
+Unaudited pro forma results of operations data as if the Company and SWH had occurred as of January 1, 2010 are as follows:
+
+ 
+
+ 
+ 
+
+The Company and SWH
+
+For the year ended
+
+December 31, 2011
+
+ 
+ 
+
+The Company and SWH
+
+For the year ended
+
+December 31, 2010
+
+ 
+
+Pro forma revenues
+
+ 
+
+$
+
+17,277,676
+
+ 
+ 
+
+$
+
+24,145,875
+
+ 
+
+Pro forma loss from operations
+
+ 
+ 
+
+(625,108
+
+)
+
+ 
+ 
+
+(289,231
+
+)
+
+Pro forma net loss
+
+ 
+ 
+
+(305,376
+
+)
+
+ 
+ 
+
+(281,108
+
+)
+
+Pro forma loss per share
+
+ 
+
+$
+
+(0.00
+
+)
+
+ 
+
+$
+
+(0.00
+
+)
+
+Pro forma diluted loss per share
+
+ 
+
+$
+
+(0.00
+
+)
+
+ 
+
+$
+
+(0.00
+
+)
+
+ 
+
+NOTE 3 PROPERTY AND EQUIPMENT
+
+ 
+
+Property and equipment consisted of the following:
+
+ 
+
+ 
+
+Estimated life
+
+ 
+
+December 31,
+
+2011
+
+ 
+ 
+
+December 31,
+
+2010
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Transportation equipment
+
+2 years
+
+ 
+ 
+
+17,671
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Furniture and fixtures
+
+7 years
+
+ 
+ 
+
+4,617
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Leasehold improvement
+
+3 years
+
+ 
+ 
+
+18,266
+
+ 
+ 
+ 
+
+1,498
+
+ 
+
+Less: Accumulated depreciation
+
+ 
+ 
+ 
+
+(9,252
+
+)
+
+ 
+ 
+
+(855
+
+)
+
+ 
+ 
+ 
+
+$
+
+31,302
+
+ 
+ 
+
+$
+
+643
+
+ 
+
+For the years ended December 31, 2011 and 2010, depreciation expense amounted to $9,252 and $13,979, respectively.
+
+ 
+
+F-30
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 4 INTANGIBLE ASSETS
+
+ 
+
+Intangible assets which were acquired from the acquisition by the Company of Lamfis and SWH consist of the following (see Note 2):
+
+ 
+
+ 
+ 
+
+December 31, 2011
+
+ 
+
+ 
+ 
+ 
+ 
+
+Customer lists
+
+ 
+$
+991,265
+ 
+
+Accumulated amortization
+
+ 
+ 
+(129,518
+)
+
+Intangible assets, net
+
+ 
+$
+861,747
+ 
+
+Customer lists for its subsidiary, Lamfis, are being amortized on a straight-line basis over the estimated useful life of three years. Customer lists related to the acquisition of the business of SWH Inc. and SWH GOV, are amortized over the estimated useful life of three years. The Company assesses fair market value for any impairment to the carrying values. As of December 31, 2011 management concluded that there was no impairment to the acquired assets. 
+
+ 
+
+The weighted average amortization period on total is approximately 2.50 years. Amortization expense for the year ended December 31, 2011 was $129,518.
+
+Future amortization of intangible assets, net is as follows:
+
+ 
+ 
+ 
+ 
+
+ 2012
+
+ 
+$
+
+330,422
+
+ 
+
+ 2013
+
+ 
+ 
+
+330,422
+
+ 
+
+ 2014
+
+ 
+ 
+
+200,903
+
+ 
+
+Total
+
+ 
+$
+
+861,747
+
+ 
+
+NOTE 5 ACCOUNTS PAYABLE, ACCRUED LIABILITIES AND MERCHANT ACCOUNTS PAYABLE
+
+ 
+
+Accounts payable and accrued liabilities consist of the following:
+
+ 
+ 
+
+December 31,
+
+2011
+
+ 
+ 
+
+December 31,
+
+2010
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Accounts payable - trade
+
+ 
+ 
+
+589,309
+
+ 
+ 
+ 
+
+128,307
+
+ 
+
+Credit card
+
+ 
+ 
+
+17,457
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Accrued expenses
+
+ 
+ 
+
+78,453
+
+ 
+ 
+ 
+
+20,069
+
+ 
+
+Accrued payroll, vacation and payroll tax
+
+ 
+ 
+
+63,724
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Sales and business tax payable
+
+ 
+ 
+
+39,456
+
+ 
+ 
+ 
+
+-
+
+ 
+
+ Total
+
+ 
+
+$
+
+788,399
+
+ 
+ 
+
+$
+
+148,376
+
+ 
+
+ 
+
+F-31
+
+ 
+
+ 
+
+NOTE 6 NOTES PAYABLE
+
+ 
+
+On March 9, 2011, the Company acquired 100% of the outstanding stock of Lamfis for $262,000. The stock purchase agreement calls for a $100,000 cash down payment with the balance of $162,000 payable in equal monthly installments of $4,640, fully amortized over thirty-six months with interest accruing at a rate of 2% per annum and matures on April 9, 2014. Promissory Notes were issued to the former shareholders of Lamfis. The agreement calls for the last installment payment to be waived should the Company make all payments in a timely fashion. As of December 31, 2011, accrued interest on these notes amounted to $0.
+
+ 
+
+At December 31, 2011, note payable short and long term portion consisted of the following:
+
+ 
+
+Total notes payable
+
+ 
+$
+120,239
+ 
+
+Less: current portion
+
+ 
+ 
+55,681
+ 
+
+Long term portion
+
+ 
+$
+64,558
+ 
+
+Future debt payments are as follows:
+
+2012
+
+ 
+$
+55,681
+ 
+
+2013
+
+ 
+ 
+55,681
+ 
+
+2014
+
+ 
+ 
+8,877
+ 
+
+Total
+
+ 
+$
+120,239
+ 
+
+NOTE 7 STOCKHOLDERS EQUITY (DEFICIT)
+
+ 
+
+Preferred Stock
+
+ 
+
+The Company is authorized to issue up to 10,000,000 shares of preferred stock, $.001 par value per share. Our board of directors is authorized, subject to any limitations prescribed by law, to provide for the issuance of the shares of preferred stock in series, and by filing a certificate pursuant to the applicable law of the state of Florida, to establish from time to time the number of shares to be included in each such series, and to fix the designation, powers, preferences and rights of the shares of each such series and any qualifications, limitations or restrictions thereof. No shares of preferred stock have been issued or are outstanding as of December 31, 2011 and 2010.
+
+ 
+
+Common Stock
+
+ 
+
+The Company is authorized to issue up to 500,000,000 shares of common stock, $.001 par value per share. As of December 31, 2011 and 2010, the Company had 117,003,803 shares and 100,200,000 shares outstanding, respectively. Holders are entitled to one vote for each share of common stock (or its equivalent).
+
+ 
+
+On April 21, 2010, the Company obtained through a vote of majority of its shareholders the approval for a 780,083 for 1 stock split of its issued and outstanding common stock. All share and per share information contained in this report gives retroactive effect to a 780,083 for 1 (780,083:1) stock split of our outstanding common stock.
+
+ 
+
+In May 2010, the Company sold 6,000,000 shares of common stock in a private transaction to three investors for proceeds of $19,500. The proceeds were used for general working capital purposes. The Company did not pay any commissions or finder s fees in this transaction.
+
+ 
+
+F-32
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 7 STOCKHOLDERS EQUITY (DEFICIT) (continued)
+
+ 
+
+In May 2010, the Company issued 200,000 shares of common stock in connection with legal services rendered. The Company valued these common shares at the fair market value on the date of grant at $650 based on the recent selling price of the Company s common stock at that time and has been recognized as professional expense.
+
+ 
+
+Between February 2011 and June 2011, the Company sold 4,799,000 units of its securities to accredited investors in a private placement which resulted in gross proceeds to us of $479,900. Each unit consisted of one share of our common stock, one series A Warrant, one Series B Warrant and one Series C Warrant at a purchase price of $0.10 per unit. The Company did not pay any commissions or finder s fees in connection with this transaction. The Company used the net proceeds for general working capital purposes.
+
+ 
+
+In March 2011, the Company sold an aggregate of 12,004,803 shares of its common stock for aggregate gross consideration of $200,000 in a private offering. The Company did not pay any commissions or finder s fees in this transaction. The Company used the proceeds for general working capital purposes and funding towards the acquisition of Lamfis.
+
+ 
+
+Common Stock Options
+
+ 
+
+On April 27, 2010, the Board of Directors granted an aggregate of 500,000 5-year options to purchase shares of common stock at $0.10 per share which vests two years from date of grant under the Company s 2010 Equity Compensation Plan.
+
+ 
+
+The 500,000 options were valued on the grant date at a total of $158 using a Black-Scholes option pricing model with the following assumptions: stock price of $0.003 per share (based on the recent selling price of the Company s common stock at that time), volatility of 56% (based on the volatility of similar entities), expected term of 4 years, and a risk free interest rate of 2.01%. The Company had applied an estimated forfeiture rate of 10% to all share-based awards which represents the portion that is expected to be forfeited over the vesting period. For the year ended December 31, 2011 and 2010, the Company did not record the stock-based compensation expense of $158 as the Company deemed it was not material.
+
+ 
+
+During the year ended December 31, 2011 and 2010, 60,000 and 260,000 options, respectively, were forfeited in accordance with the termination of employee relationships.
+
+ 
+
+F-33
+
+ 
+
+ 
+
+NOTE 7 STOCKHOLDERS EQUITY (DEFICIT) (continued)
+
+ 
+
+Information related to options granted under the 2010 Equity Compensation Plan and activity for the years then ended is as follows:
+
+ 
+
+ 
+ 
+
+Number of Options
+
+ 
+ 
+
+Weighted Average Exercise Price
+
+ 
+ 
+
+Weighted Average Remaining Contractual Life (Years)
+
+ 
+
+Balance at December 31, 2009
+
+ 
+ 
+
+-
+
+ 
+ 
+
+$
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Granted
+
+ 
+ 
+
+500,000
+
+ 
+ 
+ 
+
+0.10
+
+ 
+ 
+ 
+
+5.0
+
+ 
+
+Exercised
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Forfeited
+
+ 
+ 
+
+(260,000)
+
+ 
+ 
+ 
+
+0.10
+
+ 
+ 
+ 
+
+4.5
+
+ 
+
+Cancelled
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Balance at December 31, 2010
+
+ 
+ 
+
+240,000
+
+ 
+ 
+ 
+
+0.10
+
+ 
+ 
+ 
+
+4.42
+
+ 
+
+Granted
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Exercised
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Forfeited
+
+ 
+ 
+
+(60,000)
+
+ 
+ 
+ 
+
+0.10
+
+ 
+ 
+ 
+
+3.70
+
+ 
+
+Cancelled
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+Balance outstanding at the end of year
+
+ 
+ 
+
+180,000
+
+ 
+ 
+
+$
+
+0.10
+
+ 
+ 
+ 
+
+3.42
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Options exercisable at end of year
+
+ 
+ 
+
+-
+
+ 
+ 
+
+$
+
+-
+
+ 
+ 
+ 
+ 
+ 
+
+Options expected to vest
+
+ 
+ 
+
+180,000
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Weighted average fair value of options granted during the period
+
+ 
+ 
+ 
+ 
+ 
+
+$
+
+-
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Stock options outstanding at December 31, 2011 as disclosed in the above table have no intrinsic value at the end of the year December 31, 2011.
+
+ 
+
+Common Stock Warrants
+
+ 
+
+Between February 2011 and June 2011, the Company sold 4,799,000 units of its securities to accredited investors in a private placement which resulted in gross proceeds to us of $479,900. Each unit consisted of one share of our common stock, one series A Warrant, one Series B Warrant and one Series C Warrant at a purchase price of $0.10 per unit. Each Series A Warrant is exercisable into one share of common stock for three years from issuance at an exercise price of $0.15 per share. Each Series B Warrant is exercisable into one share of common stock for three years from issuance at an exercise price of $0.25 per share. Each Series C Warrant is exercisable into one share of common stock for three years from issuance at an exercise price of $0.50 per share. The exercise price of the warrants and the number of shares of the Company s common stock issuable upon the exercise of the warrants are subject to proportional adjustment in the event of stock splits, dividends, recapitalizations or similar transactions. Upon 30 days notice, the Company has the right to call any series of warrants at $0.001 per warrant upon the following terms, providing that the shares of common stock underlying the Warrant are registered for resale:
+
+ 
+
+If the closing price of the Company s common stock equals or exceeds $0.30 per share for 20 consecutive trading days, the Company has the right to call the Series A Warrants,
+
+ 
+
+If the closing price of the Company s common stock equals or exceeds $0.375 per share for 20 consecutive trading days, the Company has the right to call the Series B Warrants, and
+
+ 
+
+If the closing price of the Company s common stock equals or exceeds $0.625 per share for 20 consecutive trading days, the Company has the right to call the Series C Warrants.
+
+ 
+
+F-34
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 7 STOCKHOLDERS EQUITY (DEFICIT) (continued)
+
+ 
+
+Other than the exercise price and call provisions of each series of warrant, all other terms and conditions of the warrants are the same.
+
+ 
+
+A summary of the status of the Company's outstanding stock warrants as of December 31, 2011 and 2010 and changes during the period then ended is as follows:
+
+ 
+
+ 
+
+ 
+
+Number of Warrants
+
+ 
+ 
+
+Weighted Average Exercise Price
+
+ 
+
+Weighted Average Remaining Contractual Life (Years)
+
+Balance at December 31, 2009
+
+ 
+ 
+
+-
+
+ 
+ 
+
+$
+
+-
+
+ 
+
+-
+
+Granted
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Cancelled
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Forfeited
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Exercised
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Balance at December 31, 2010
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Granted
+
+ 
+ 
+
+14,397,000
+
+ 
+ 
+ 
+
+0.30
+
+ 
+
+3.00
+
+Cancelled
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Forfeited
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Exercised
+
+ 
+ 
+
+-
+
+ 
+ 
+ 
+
+-
+
+ 
+
+-
+
+Balance at December 31, 2011
+
+ 
+ 
+
+14,397,000
+
+ 
+ 
+
+$
+
+0.30
+
+ 
+
+2.25
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Warrants exercisable at December 31, 2011
+
+ 
+ 
+
+14,397,000
+
+ 
+ 
+
+$
+
+0.30 
+
+ 
+
+2.25
+
+Weighted average fair value of options granted during the year ended December 31, 2011
+
+ 
+ 
+ 
+ 
+ 
+
+$
+
+0.01
+
+ 
+ 
+
+NOTE 8 RELATED PARTY TRANSACTIONS
+
+ 
+
+The Company had leased its principal executive offices, totaling approximately 1,500 square feet, from a company which is owned by the Company s Executive Officers and Directors and two other partners, one of which is a principal shareholder of the Company. Pursuant to an agreement that expired on May 31, 2011 at $12,000 per annum. An addendum had been signed which had extended the lease to September 30, 2011 at $1,000 per month. The Company is no longer leasing such executive office space after September 30, 2011.
+
+ 
+
+From time to time the Company also enters into transactions with Computer Nerds International, Inc. ( Computer Nerds ), a company owned by certain of the Company s Officers, including:
+
+ 
+
+ 
+From time to time Computer Nerds had advanced us funds for working capital. The loans were due on demand and interest free. At December 31, 2011 and December 31, 2010 the Company owed $0 and $9,119, respectively.
+
+ 
+ 
+
+ 
+The Company purchased inventories and products for sale from Computer Nerds totaling approximately $2,113,000 and $9,000 during the years ended December 31, 2011 and 2010, respectively. The Company s sales to Computer Nerds totaling approximately $500 and $0 during the years ended December 31, 2011 and 2010, respectively. Accounts payable to Computer Nerds as of December 31, 2011 and 2010, was $300,939 and $4,180, respectively, and were reflected as accounts payable related party in the accompanying consolidated balance sheets.
+
+ 
+
+ 
+
+F-35
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 8 RELATED PARTY TRANSACTIONS (continued)
+
+ 
+
+Additionally, on October 25, 2011, the Company, through its subsidiary, Superwarehouse, entered into a Distribution Agreement (the Agreement ) with Computer Nerds whereby the Company appoints Computer Nerds as its non-exclusive distributor of the Company s products in order to market, promote, distribute, and sell the product to its customers, directly or indirectly and shall include all products, territories, geographies, customers and markets without restriction. The initial term of this Agreement began on October 25, 2011 and shall end on December 31, 2012. The term shall automatically renew for a one year period on each subsequent anniversary date of the effective date. The Company may give written notice of its intent to terminate this Agreement at anytime. Pursuant to the Agreement, Computer Nerds agrees to charge the Company its cost plus 2% distributor fee. The Company paid approximately $38,000 of the 2% distributor fee during the year ended December 31, 2011.
+
+ 
+
+At December 31, 2010, the Company s Executive Officers and Directors had advanced an aggregate of $30,210 representing a working capital advance to the Company. These loans were due on demand and bore interest at a rate of 6% per annum effective January 1, 2010. Accrued interest as of December 31, 2011 and 2010, amounted to $0 and $1,710, respectively, and were included in due to related parties as reflected in the accompanying consolidated balance sheets. In October 2011, the Company paid off the principal and accrued interest from such related party loan.
+
+ 
+
+In October 2011, the Company issued promissory notes to three officers of the Company in an aggregate amount of $150,000. The notes were due in January 2012 and bore interest at a rate of 18% per annum. Accrued interest as of December 31, 2011, amounted to $6,505. Between January 2012 and February 2012, the Company paid off the principal and accrued interest from such promissory notes.
+
+ 
+
+At December 31, 2009, the Company recorded $2,000 stock subscription receivable representing common stock subscription sale to an officer in fiscal year 2009. At December 31, 2011 and 2010, the Company collected subscription receivable of $200 and $1,800, respectively.
+
+ 
+
+During fiscal 2011, the Company advanced $2,691 to a shareholder of the Company. This advance is due on demand and non-interest bearing. Such advance is expected to be collected on April 30, 2012.
+
+ 
+
+NOTE 9 - INCOME TAXES
+
+ 
+
+Prior to March 10, 2011, the Company was an S Corporation whereby elements of income taxation including income, expense, credits and allowances of the Company are reflected in a proportional basis on the stockholder s individual income tax returns. Accordingly, there is no provision for income taxes in these consolidated financial statements for the year ended December 31, 2010 or for income allocated to the period January 1, 2011 to March 9, 2011.
+
+ 
+
+Beginning on March 10, 2011, the Company s tax status changed to a C Corporation as a result of a change in the ownership of the Company to include an ineligible shareholder for S status purposes. The Company accounts for income taxes under ASC Topic 740: Income Taxes which requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carryforwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. The Company has a net operating loss carryforward for tax purposes totaling approximately $273,000 at December 31, 2011, expiring through the year 2031. Internal Revenue Code Section 382 places a limitation on the amount of taxable income that can be offset by carryforwards after certain ownership shifts.
+
+ 
+
+F-36
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 9 - INCOME TAXES (continued)
+
+ 
+
+The table below summarizes the differences between the Companies effective tax rate and the statutory federal rate as follows for the period ended:
+
+ 
+ 
+
+December 31, 2011
+
+ 
+
+ 
+ 
+ 
+ 
+
+Computed "expected" tax expense (benefit)
+
+ 
+ 
+(35.0
+)%
+
+State income taxes
+
+ 
+ 
+(5.0
+)%
+
+Permanent differences
+
+ 
+ 
+14.0
+%
+
+Change in valuation allowance
+
+ 
+ 
+26.0
+%
+
+ 
+ 
+ 
+ 
+ 
+
+Effective tax rate
+
+ 
+ 
+0.0
+%
+
+The Companies have a deferred tax asset which is summarized as follows at:
+
+ 
+
+Deferred tax assets:
+
+ 
+
+December 31, 
+
+2011
+
+ 
+
+Net operating loss carryover
+
+ 
+$
+109,200
+ 
+
+Less: valuation allowance
+
+ 
+ 
+(109,200
+)
+
+Net deferred tax asset
+
+ 
+$
+-
+ 
+
+After consideration of all the evidence, both positive and negative, management has recorded a full valuation allowance at December 31, 2011, due to the uncertainty of realizing the deferred income tax assets. The valuation allowance was increased by $109,200.
+
+ 
+
+Had the Company been a subchapter C Corporation for federal and state income tax purposes prior to March 10, 2011, the tax net operating loss carryforwards would have been increased by approximately $567,000 as of December 31, 2011 and the deferred asset before any valuation allowance would have been increased by $226,800. However, due to tax losses and management s recording of a full valuation allowance, income tax expense would have been zero for the prior period presented.
+
+ 
+
+NOTE 10 COMMITMENTS AND CONTINGENCIES
+
+ 
+
+Consulting Contracts
+
+ 
+
+In March 2011 the Company entered into a consulting agreement with Brainard Equities, LLC in connection with business development and advisory services related to acquisition matters to the Company. This agreement is in effect for one year and payment was made in full on March 23, 2011 in the amount of $50,000.
+
+ 
+
+In December 2011, the Company entered into a 6 month investment banking and financial advisor agreement pursuant to which it agreed to act as an exclusive investment banking consultant (the Consultant ) for the Company. The Company shall pay the Consultant 10% of gross proceeds raised from a private placement financings and warrants to purchase shares of the Company s common stock equal to 10% of the number of shares sold from such private placement financings. The Company shall pay a $25,000 retainer fee for its services. In December 2011, the Company paid $12,500 of the retainer.
+
+ 
+
+Additionally, in December 2011, the Company entered into a consulting and advisory agreement with the same Consultant (see above) which term is from the date of this agreement through the 3 year anniversary of the final closing of the financing of the Company s convertible promissory note as defined in the agreement. The Company shall pay $5,000 commencing on the month following the initial closing of the financing. The Company shall issue 4,200,000 shares of the Company s Common stock for advisory services. The 4,200,000 shares are subject to a re-purchase in the event that there has been no closing of the financing after 1 year pursuant to this agreement. No funds were raised as of December 31, 2011 and as such the Company was not obligated to issue the 4,200,000 shares to the Consultant.
+
+ 
+
+ 
+
+F-37
+
+ 
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 10 COMMITMENTS AND CONTINGENCIES (continued)
+
+ 
+
+In July 2011, the Company entered into a 4 year Rebate Agreement (the Agreement ) with a distributor. The Company received a one-time advance rebate allowance of $375,000 and marketing allowance of $25,000 whereby the Company will purchase at least 90% of the Company s monthly purchase requirements of products for sale from such distributor. Pursuant to the Agreement, the Company is eligible to receive volume cash discount, volume flat rebates, marketing rebate and annual growth rebates as defined in the Agreement. The allowance is subject to a repayment claw back provision upon the occurrence of either (i) the acquisition of the Company by a third party including the sale of all or substantially all of the Company s equity or assets, a merger, or transaction resulting in a change of control or (ii) the Company does not honor its purchase commitments for 2 or 3 consecutive months in a 12 months period. If a repayment claw back occurs, the Company shall pay back the unearned portion of any discounts, rebates and allowances paid by the distributor. The Company recorded the advance rebate and marketing allowance as deferred discount as reflected in the accompanying consolidated balance sheets. The Company amortizes the advance rebate to cost of sales and amortizes the advance marketing allowance to expense over the term of the Agreement. Deferred discount- short term at December 31, 2011 was $100,000 and will be amortized within a year. Deferred discount- long term at December 31, 2011 was $250,000 and will be amortized over the remaining term of the agreement beyond one year period.
+
+ 
+
+Operating Lease
+
+ 
+
+A lease agreement was signed for office and warehousing space located in Broward County, Florida with an initial term commencing on June 1, 2011 and expiring on July 31, 2014. Such office space consists of approximately 6,962 square feet and serves as the corporate headquarters of the Company and its subsidiary, Lamfis. There are no minimum, contingent or sublease arrangements in the lease. Future minimum rental payments required under this operating lease are as follows:
+
+ 
+
+ 
+Period ending December 31, 2012
+$51,953
+
+ 
+Period ending December 31, 2013
+$53,027
+
+ 
+Thereafter
+$31,311
+
+ 
+
+Included in the lease is a $10,345 credit against rent due for work performed by the Company for leasehold improvements to office and warehousing space. This is not reflected in the numbers above.
+
+ 
+
+In August 2011, the Company entered into an amendment agreement whereby the lease for an office and warehousing space located in San Diego, California was extended up to September 30, 2012 which serves as the headquarters of the Company s subsidiary, Superwarehouse. The monthly base rent for the extended period shall be $1,993. Future minimum rental payments required under this operating lease are as follows:
+
+ 
+
+ 
+Period ending December 31, 2012
+$23,916
+
+ 
+
+Rent expense was $39,125 and $12,840 for the years ended December 31, 2011 and 2010, respectively.
+
+ 
+
+F-38
+
+ 
+
+RANDOM SOURCE INC. AND SUBSIDIARIES
+
+NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+
+DECEMBER 31, 2011
+
+ 
+
+NOTE 10 COMMITMENTS AND CONTINGENCIES (continued)
+
+ 
+
+Employment Agreement
+
+ 
+
+On April 27, 2010, the Company entered into an employment agreement (the Employment Agreement ) with Mr. Kriegstein, Chief Executive Officer of the Company and Mr. Merrick, Chief Financial Officer of the Company (the Executives ). The term of this Employment Agreement shall commence on the effective date and end on the date which is the earlier of (i) the second anniversary of the Effective Date, or (ii) the date on which the Company either concludes an initial public offering of its securities or consummates a transaction in which the Company is acquired by another individual or entity (the Termination Date ). The term may be extended for additional one (1) year period by written notice given by the Company to the Executives at least 60 days before the expiration of the term. Mr. Kriegstein s present base salary is $50,000 per year and Mr. Merrick s present base salary is $48,000. The Executives are entitled to receive discretionary bonus compensation as determined by the board of directors from time to time. During the employment term, the Executives shall be entitled to (i) vacation per annum, (ii) business expense reimbursements and (iii) participate in all benefit programs of the Company currently existing as defined in the Employment Agreement. If Executive s employment is terminated without cause, upon death or should he become disabled, the Executives will be entitled to his base salary for a period of the earlier of (i) 1 year from and after the date of death and if disabled, 6 months following such disability or (ii) the Termination Date. As defined in the agreement, the Executives are restricted from competing with the Company for 1 year following such termination. On February 8, 2012, this Employment Agreement was amended (see Note 11).
+
+ 
+
+NOTE 11 - SUBSEQUENT EVENTS
+
+ 
+
+On February 15, 2012, the Company issued a promissory note to a related party, who is a shareholder of the Company, for $25,000. The note bears an annual interest rate of 6% per annum. The principal amount together with accrued interest will be due on the closing date of the Company s financing pursuant to its February 2012 Private Placement Memorandum.
+
+ 
+
+On February 8, 2012 the Company entered into an amended Executive Employment Agreement with the Company s Chief Executive Officer and Chief Financial Officer whereby the Company and the Executives agreed to amend certain Employment Agreement dated on April 27, 2010 and extend the term of such Employment Agreement to February 1, 2015. The term may be extended for an additional 1 year period by written notice given by the Company to the Executives at least 60 days before the expiration date. All other terms and conditions of the Employment Agreement remain in full force and effect.
+
+ 
+
+On February 7, 2012, the Company entered into a non-binding letter of intent with a Public company and the Public company s shareholders regarding a merger or acquisition agreement through a share exchange whereby the Public company shall issue its shares in exchange for all of the outstanding stock of the Company which is commonly referred to as a reverse merger. The Company shall pay a purchase price in cash of $304,000 upon closing of such reverse merger transaction. Upon the execution of this letter of intent, the Company paid $25,000 which may be refunded back subject to a provision as defined in the letter of intent agreement.
+
+ 
+
+The Company has evaluated events and transactions that occurred subsequent to December 31, 2011, through the date the consolidated financial statements were issued, for potential recognition or disclosure in the accompanying consolidated financial statements. Other than the disclosures shown, the Company did not identify any events or transactions through date the consolidated financial statements were issued, that should be recognized or disclosed in the accompanying consolidated financial statement.
+
+ 
+
+ 
+
+ 
+
+F-39
+
+ 
+
+ 
+
+ 
+
+PART II
+
+ 
+
+INFORMATION NOT REQUIRED IN PROSPECTUS
+
+ 
+
+ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
+
+ 
+
+The estimated expenses payable by us in connection with the distribution of the securities being registered are as follows:
+
+ 
+
+SEC registration and filing fee
+
+ 
+
+$
+
+ 812 
+
+ 
+
+Legal fees and expenses*
+
+ 
+ 
+
+7,500
+
+ 
+
+Accounting fees and expenses*
+
+ 
+ 
+
+5,000
+
+ 
+
+EDGAR and financial printing costs*
+
+ 
+ 
+
+2,500
+
+ 
+
+Transfer agent fees*
+
+ 
+ 
+
+1,500
+
+ 
+
+Blue sky fees and expenses*
+
+ 
+ 
+
+200
+
+ 
+
+Miscellaneous*
+
+ 
+ 
+
+279
+
+ 
+
+TOTAL
+
+ 
+
+$
+
+ 17,791 
+
+ 
+
+ 
+
+* Estimated
+
+ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
+
+The Florida Business Corporation Act allows us to indemnify each of our officers and directors who are made a party to a proceeding if:
+
+(a) the officer or director conducted himself or herself in good faith;
+
+(b) his or her conduct was in our best interests, or if the conduct was not in an official capacity, that the conduct was not opposed to our best interests; and
+
+(c) in the case of a criminal proceeding, he or she had no reasonable cause to believe that his or her conduct was unlawful. We may not indemnify our officers or directors in connection with a proceeding by or in our right, where the officer or director was adjudged liable to us, or in any other proceeding, where our officer or director are found to have derived an improper personal benefit.
+
+Our by-laws require us to indemnify directors and officers against, to the fullest extent permitted by law, liabilities which they may incur under the circumstances described above.
+
+Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling our company pursuant to the foregoing provisions, we have been informed that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the act and is therefore unenforceable.
+
+ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
+
+ 
+
+Following are all issuances of securities by the registrant during the past three years which were not registered under the Securities Act of 1933, as amended (the Securities Act ). In each of these issuances the recipient represented that he was acquiring the shares for investment purposes only, and not with a view towards distribution or resale except in compliance with applicable securities laws and had access to information concerning our company. No general solicitation or advertising was used in connection with any transaction, and the certificate evidencing the securities that were issued contained a legend restricting their transferability absent registration under the Securities Act or the availability of an applicable exemption therefrom. Unless specifically set forth below, no underwriter participated in the transaction and no commissions were paid in connection with the transactions.
+
+In March 2011 Random Source sold an aggregate of 112,204,803 shares of its common stock to 11 of its shareholders in exchange for aggregate gross consideration of $200,000 in a private transaction. It did not pay any commissions or finder s fee in this transaction. It used the proceeds for general working capital. The purchasers were accredited investors and the issuances were exempt from registration under the Securities Act in reliance on an exemption provided by Section 4(2) of that act.
+
+ 
+
+II-1
+
+ 
+
+ 
+
+Between February 2011 and June 2011, Random Source sold 4,799,000 units of its securities to 27 accredited investors in a private placement which resulted in gross proceeds to it of $479,000. Each unit consisted of one share of its common stock, one Series A Warrant, one Series B Warrant and one Series C Warrant at a purchase price of $0.10 per unit. Random Source did not pay any commissions or finder s fees in these sales and it used the net proceeds for general working capital. The offering was exempt from registration under the Securities Act in reliance on an exemption provided by Section 4(2) and Regulation D of that act.
+
+In May 2012, in connection with the reverse merger with Random Source we issued 127,989,517 shares of our common stock to the exchanging Random Source shareholders and, with respect to the Random Source shareholders who were also warrant holders, we issued common stock purchase warrants to purchase 15,075,571 shares of our common stock exercise prices ranging from $0.07 to $0.50 per share in exchange for identical warrants to purchase Random Source common stock which were held by the warrant holders immediately prior to closing. All of the Random Source shareholders and warrant holders were accredited investors. These issuances were made in a private transaction exempt from registration under the Securities Act in reliance on an exemption provided by Section 4(2) of that act.
+
+Between June 2012 and July 2012, we sold an aggregate of 1,428,571 shares of our common stock at a purchase price of $0.07 per share to four accredited investors in a private placement exempt from registration under the Securities Act in reliance on exemptions provided by Section 4(2) and Regulation D of that act. We received gross proceeds of $100,000. Mediterranean Securities Group, LLC, a broker-dealer and member of FINRA, acted as placement agent for us in this offering. We paid the placement agent a cash commission of $10,000, a non-accountable expense allowance of $2,000 and issued it five year warrants to purchase 142,857 shares of our common stock at an exercise price of $0.07 per share which are exercisable on a cashless basis as compensation for its services. We are using the net proceeds of this offering for working capital.
+
+On July 24, 2012 we sold Mediterranean Equity Partners LLC, an affiliate of Mediterranean Securities Group, LLC, 1,000,000 shares of our common stock for an aggregate consideration of $1,000 and other good and valuable consideration in a private transaction exempt from registration under the Securities Act in reliance on an exemption provided by Section 4(2) of that act. We did not pay any commissions or finder s fees in this transaction and we are using the proceeds for working capital.
+
+ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
+
+2.1
+
+Agreement and Plan of Reorganization dated April 27, 2012 by and between Proguard Acquisition Corp., Proguard Acquisition Subsidiary Corp. and Random Source, Inc. (incorporated by reference to the Current Report on Form 8-K as filed on May 2, 2012).
+
+3.1
+
+Articles of Incorporation (incorporated by reference to the Registration Statement on Form SB-2, SEC File No. 333-123910, as amended).
+
+3.2
+
+Bylaws (incorporated by reference to the Registration Statement on Form SB-2, SEC File No. 333-123910, as amended).
+
+3.3
+
+Articles of Merger by and between Proguard Acquisition Subsidiary Corp. and Random Source, Inc. (incorporated by reference to the Current Report on Form 8-K as filed on May 10, 2012)
+
+3.4
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001337553_aerie_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001337553_aerie_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..45fbb092a30381f5506b1e0de07c61301fbcad84
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001337553_aerie_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. Before you decide to invest in our common stock, you should read the entire prospectus carefully, including the Risk Factors section and the financial statements and related notes appearing at the end of this prospectus. In this prospectus, unless otherwise stated or the context otherwise indicates, references to Aerie, we, us, our and similar references refer to Aerie Pharmaceuticals, Inc. Overview We are a clinical-stage pharmaceutical company focused on the discovery, development and commercialization of first-in-class therapies for the treatment of patients with glaucoma and other diseases of the eye. Glaucoma is one of the largest segments in the global ophthalmic market. In 2012, branded and generic glaucoma product sales exceeded $4.5 billion in the United States, Europe and Japan in aggregate, according to IMS, and prescription volume is expected to grow, driven in large part by the aging population. Our strategy is to advance our product candidates, including dual-action AR-13324 and triple-action PG324, to regulatory approval and commercialize these products ourselves in the United States. We plan to build a commercial team of approximately 100 sales representatives to target approximately 10,000 high prescribing eye-care professionals throughout the United States. For certain key markets outside the United States, including Europe, Japan and emerging markets, we intend to explore partnership opportunities through collaboration and licensing arrangements. We plan to further maximize our commercial potential by identifying and advancing additional product candidates, both through our internal discovery efforts and through possible in-licensing or acquisitions of additional ophthalmic products or product candidates that would complement our current product portfolio. Our senior leadership team has extensive experience in the ophthalmology market and has overseen the development and commercialization at major pharmaceutical companies of several successful ophthalmic products, including Acular, Alphagan P, Bepreve, Besivance, Bromday, Istalol, Ocuflox, Retisert, Vitrase, Xibrom and Zylet. If our products are approved and we are commercially successful, we believe Aerie could become a market-leading ophthalmic company. Our product candidates are once-daily eye drops that, if approved, will provide eye-care professionals with the first novel intraocular pressure-lowering mechanisms of action, or MOA, to treat glaucoma in nearly 20 years. Our lead product candidate, dual-action AR-13324, recently completed a Phase 2b clinical trial. We are currently planning two Phase 3 registration trials for this product candidate, which we expect to commence in mid-2014. Additionally, we are planning to commence a Phase 2b clinical trial by early 2014 for our triple-action PG324, a fixed-dose combination of AR-13324 and the prostaglandin analogue, or PGA, latanoprost, the most commonly prescribed drug for the treatment of patients with glaucoma. Glaucoma is a progressive and highly individualized disease, in which elevated levels of intraocular pressure, or IOP, are associated with damage to the optic nerve, which results in irreversible vision loss and potentially blindness. Patients may suffer the adverse effects of glaucoma across a wide range of IOP levels. The level of IOP in healthy individuals is generally accepted to be 10 to 21 millimeters of mercury, or mmHg. The majority of glaucoma patients have IOP of 26 mmHg or below at the time of diagnosis, which we refer to as low to moderately elevated IOP. Glaucoma is treated by the reduction of IOP, which has been shown to slow the progression of vision loss. The U.S. Food and Drug Administration, or FDA, recognizes sustained lowering of IOP as the primary clinical endpoint for regulatory approval. Once glaucoma develops, it is a chronic condition that requires life-long treatment. The initial treatment for glaucoma patients is typically the use of a prescription eye drop. PGAs have become the most widely prescribed glaucoma drug class. The most frequently prescribed PGA is once-daily latanoprost. The most commonly prescribed non-PGA drugs belong to the beta blocker class. The most frequently prescribed beta blocker is twice-daily timolol. Other non-PGA drug classes include the alpha agonists and carbonic anhydrase inhibitors. When PGA monotherapy is insufficient to control IOP, non- Table of Contents The information contained in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED OCTOBER 21, 2013 PRELIMINARY PROSPECTUS 5,250,000 Shares Common Stock We are offering 5,250,000 shares of our common stock. This is our initial public offering and no public market currently exists for our common stock. We expect the initial public offering price to be between $12.00 and $14.00 per share. We have applied to list our common stock on the NASDAQ Global Market under the symbol AERI. Investing in our common stock involves a high degree of risk. Please read Risk Factors beginning on page 13 of this prospectus. We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, and will be subject to reduced public company reporting requirements. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PER SHARE TOTAL Public Offering Price $ $ Underwriting Discounts and Commissions $ $ Proceeds to Aerie Pharmaceuticals, Inc. before expenses (1) $ $ (1) See Underwriting for additional information regarding underwriter compensation. Our existing principal stockholders and their affiliated entities have indicated an interest in purchasing an aggregate of approximately $10 million of shares of our common stock in this offering at the initial public offering price. However, because indications of interest are not binding agreements or commitments to purchase, any of these stockholders may determine to purchase more, less or no shares in this offering, or the underwriters may determine to sell more, less or no shares in this offering to any of these stockholders. Delivery of the shares of common stock is expected to be made on or about , 2013. We have granted the underwriters an option for a period of 30 days to purchase an additional 787,500 shares of our common stock. If the underwriters exercise the option in full, the total underwriting discounts and commissions payable by us will be $ , and the total proceeds to us, before expenses, will be $ . RBC Capital Markets Stifel Canaccord Genuity Needham & Company Prospectus dated , 2013 Table of Contents PGA products are used either as add-on therapy to the PGA or as an alternative monotherapy. Due to the multiple daily dosings, side effects and contraindications of non-PGA products, we believe there is a significant unmet need in the non-PGA market segment, which represents approximately half of the U.S. and European glaucoma market based on prescription volumes. Our primary product candidates, once-daily dual-action AR-13324 and once-daily triple-action PG324, lower IOP through novel MOAs. Our product candidates inhibit both Rho Kinase, or ROCK, and the norepinephrine transporter, or NET. Through ROCK inhibition, they reduce IOP by increasing fluid outflow through the trabecular meshwork, or the TM, the tissue responsible for elevated IOP in glaucoma and the eye s primary drain, which accounts for approximately 80% of fluid drainage. Through NET inhibition, AR-13324 also lowers IOP by reducing the production of eye fluid. PG324, a single-drop fixed-dose combination of AR-13324 with latanoprost, lowers IOP through the same MOAs as AR-13324, and also by increasing fluid outflow through the uveoscleral pathway, the eye s secondary drain. We believe that dual-action AR-13324 has several significant differentiating characteristics that would make it a strong competitor in the non-PGA market segment, if approved, including: Strong IOP-Lowering Effect In our Phase 2b clinical trial, once-daily AR-13324 demonstrated mean IOP reductions of 5.7 and 6.2 mmHg on days 28 and 14, respectively. Studies have shown that a sustained 5 mmHg reduction in IOP reduces risk of disease progression by approximately 50%. If confirmed in our planned Phase 3 registration trials, we believe this level of IOP reduction would equal or exceed that of all currently marketed non-PGA drugs. Once-Daily Dosing Advantage The most commonly prescribed non-PGA drugs are dosed two to three times daily. AR-13324 is being developed as a once-daily dosed glaucoma therapy. This more convenient dosing regimen is expected to result in higher patient compliance, which may lead to improved outcomes. Favorable Tolerability Profile Currently marketed non-PGA drugs have several tolerability issues indicated on their product labels, including blurred vision, unusual tastes, ocular allergic reaction and itching of the eye. In our Phase 2a and Phase 2b clinical trials for AR-13324, a total of 209 patients were exposed to AR-13324. The main tolerability finding for AR-13324 was transient, or temporary, hyperemia, which is a cosmetic asymptomatic redness of the eye. Most hyperemia was scored as mild. Hyperemia is a common tolerability finding associated with the most widely prescribed glaucoma drugs. Lack of Systemic Side Effects AR-13324 has demonstrated a lack of systemic side effects in clinical trials to date. The currently marketed non-PGA drugs have systemic side effect issues indicated on their product labels, including among others, lethargy, reduced heart rate, Stevens Johnson syndrome and blood dyscrasias. Further, the most widely prescribed non-PGA drug, timolol, has contraindications, including bronchospasm, arrhythmia and heart failure. Novel Dual-Action MOA If approved, we believe AR-13324 would be the only once-daily drug available that specifically targets the TM, the diseased tissue responsible for elevated IOP in glaucoma. We believe AR-13324 will also be the first glaucoma drug to inhibit NET, which reduces fluid production in the eye. In addition, we believe the AR-13324 dual-action MOA is highly complementary to the MOA of the market-leading PGAs, which increase fluid outflow through the uveoscleral pathway. Consistent IOP-Lowering Effect Across Various Baseline IOPs In our Phase 2b clinical trial, AR-13324 demonstrated a distinct ability to reduce IOP at consistent levels across all baseline IOPs tested in the trial. Published studies have indicated that currently marketed PGA and non-PGA drugs do not lower IOP as effectively in patients with low to moderately elevated baseline IOPs relative to patients with higher IOPs. Patients with low to moderately elevated IOPs represent the significant majority of glaucoma patients. Table of Contents TABLE OF CONTENTS PROSPECTUS SUMMARY 1
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+Prospectus Summary This summary highlights certain information about us and this offering contained elsewhere in this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in shares of our common stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this prospectus. Before you decide to invest in our common stock, you should read the entire prospectus carefully, including "Risk Factors" beginning on page 13 and the financial statements and related notes included in this prospectus. Unless the context indicates otherwise, as used in this prospectus, the terms "TetraLogic," "we," "us," "our," "our company" and "our business" refer to TetraLogic Pharmaceuticals Corporation. Overview We are a clinical-stage biopharmaceutical company focused on discovering and developing novel small molecule therapeutics that mimic Second Mitochondrial Activator of Caspases, or SMAC-mimetics, and are designed to cause or enable abnormal cells that are resistant to the body's immune system to self-destruct. Birinapant, our clinical-stage product candidate, is currently being tested in Phase 1 and Phase 2 oncology clinical trials for hematological malignancies and multiple solid tumors. Our clinical trials of birinapant have enrolled over 275 subjects. Our clinical and pre-clinical programs are focused on: myelodysplastic syndromes, or MDS We have an ongoing Phase 1/2 clinical trial in various blood cancers. We have also started a Phase 1 clinical trial in MDS and, upon its completion, intend to start a randomized Phase 2 clinical trial in MDS in the first half of 2014. colorectal cancer, or CRC We have substantially completed a Phase 1/2 clinical trial in CRC, and we intend to start a randomized clinical trial in CRC, subject to our ability to obtain additional financing apart from this offering. ovarian cancer We have an open Investigational New Drug Application, or IND, and intend to start a Phase 1/2 clinical trial in ovarian cancer in the fourth quarter of 2013. hepatitis B virus, or HBV We intend to start a Phase 1 clinical trial in HBV in the fourth quarter of 2014. Background of SMAC-mimetics Fundamentally important to maintaining human health is the mechanism in both normal and abnormal cells for controlling programmed cell death. This process of self-destruction of cells is known as apoptosis. There are multiple checks and balances within a cell to ensure that healthy cells do not undergo apoptosis by mistake and that abnormal cells such as cancerous and virally infected cells undergo apoptosis and are cleared from the body. Key molecules that protect cells from apoptosis are called the Inhibitor of Apoptosis proteins, or IAPs. A key molecule that promotes apoptosis is Second Mitochondrial Activator of Caspases, or SMAC, a naturally occurring IAP inhibitor. In many diseases, such as certain cancers and infections, abnormal cells that should be naturally cleared from the body manage to escape apoptosis. As a result, cells that should self-destruct actually Amendment No. 6 to FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents survive and even proliferate or propagate infection, leading to multiple disease complications. In both cancer and viral infections, the abnormal cells typically use the same escape pathway: the overexpression of IAPs resulting in the avoidance of the signals to undergo cell self-destruction. Tumor Necrosis Factor, or TNF, is an extracellular signaling molecule that induces apoptosis. Cancer cells and certain virally infected cells can use IAPs to convert a TNF-induced self-destruction signal into a pro-survival signal through a protein complex called NF-kB. While a number of cancer therapies induce TNF, the TNF self-destruction signal may be blocked by the IAPs. Normally, IAPs can be disabled by their natural inhibitor SMAC, but this natural blocking mechanism is rendered ineffective in many cancers and certain viral infections due to the overexpression of IAPs. We believe SMAC-mimetics have the potential to inhibit the overexpressed IAPs and re-establish the TNF self-destruction signal. Our therapeutic focus is centered on the development of SMAC-mimetics that are designed to inhibit IAPs and re-establish the TNF self-destruction signal in order to overcome this "escape-from-apoptosis" in malignant or infected cells. A key element of our strategy is to administer a SMAC-mimetic with other therapies that induce TNF or related self-destruction signaling molecules. Examples of such other therapies are azacitidine, gemcitabine, granulocyte-macrophage colony-stimulating factor, or GM-CSF, interferon, or IFN, irinotecan and radiation therapy. There are no drugs currently on the market that specifically target the IAPs to re-establish apoptosis in abnormal cells. Birinapant Birinapant was selected from our chemical library of over 3,000 SMAC-mimetic compounds, has a strong intellectual property profile, and we believe has the potential to be broadly active across multiple tumor types and against virally-infected cells. Over 275 study participants with cancer have been treated with birinapant alone or administered with standard chemotherapies. In clinical trials, birinapant was generally well tolerated, meaning that treatment-related side effects were mild or moderate in severity in the majority of treated subjects, and showed signs of activity in subjects with cancer. In pre-clinical cancer studies, birinapant was synergistic (or super-additive) with agents that induce TNF, including established anti-cancer chemotherapies (such as azacitidine, gemcitabine and irinotecan), other anti-cancer therapies (such as radiotherapy), biological agents (such as GM-CSF and IFN) and with TNF and other members of the TNF superfamily including TNF-related apoptosis-inducing ligand, or TRAIL, and TRAIL-Receptor 2 (also known as Death Receptor 5, or DR5) agonists. In addition, birinapant reduced HBV levels in animal studies in a TNF-dependent manner. Our clinical strategy is to administer birinapant with therapies (for example, azacitidine or irinotecan) that induce the production of TNF or related molecules. TetraLogic Pharmaceuticals Corporation (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation or organization) 2834 (Primary Standard Industrial Classification Code Number) 42-1604756 (I.R.S. Employer Identification Number) 343 Phoenixville Pike Malvern, PA 19355 (610) 889-9900 (Address, including zip code and telephone number, including area code, of registrant's principal executive offices) Table of Contents FIGURE 1. Birinapant is designed to mimic SMAC and enable TNF-activated apoptosis. As shown in FIGURE 1, above, the principal target of birinapant is the IAP called cIAP1. A secondary target is the IAP called cIAP2 (not shown in FIGURE 1 above). Both are critical components of the TNF receptor 1 complex. It is this TNF receptor 1 complex that receives the TNF signal and then transmits it inside the cell, triggering a cascade of events that includes activation of NF-kB which delivers the pro-survival signal to a cancer cell. Activity in Clinical Trials We believe that our pre-clinical and clinical data suggest that birinapant has potential for treating a wide spectrum of hematological malignancies, solid tumors and viral infections, and provide the rationale for further clinical development of birinapant. In clinical trials, birinapant has shown favorable pharmacokinetic, or PK, properties, meaning how the subject's body handles birinapant, including the length of time birinapant remains in a subject's blood or tumor, with similar and predictable behavior among treated subjects. In addition, our clinical trials show evidence that birinapant is interacting with its intended target and that the activation of NF-kB was inhibited in subject tumor cells. Birinapant has thus far shown clinical activity in both hematological malignancies and solid tumors, including acute myelogenous leukemia, or AML, and CRC. Phase 1 and Phase 2 clinical trials have been completed or are ongoing with birinapant. Initial response and safety data from the Phase 1/2 solid tumor trial were reported at the 2013 Annual Meeting of the American Society of Clinical Oncology. Our Phase 1 clinical trials are designed to define the maximum tolerated dose, or MTD, of birinapant both as a single agent and when administered with other chemotherapies, to gather PK and safety data, and to determine the recommended Phase 2 dose. Phase 2 clinical trials are designed to determine the tolerability and magnitude of clinical benefit of birinapant both as a single agent and when administered with other chemotherapies, initially in a small number of subjects. Our Phase 1/2 clinical trials are designed to include both a dose escalation component and a fixed dose component J. Kevin Buchi President and Chief Executive Officer TetraLogic Pharmaceuticals Corporation 343 Phoenixville Pike Malvern, PA 19355 (610) 889-9900 (Name, address, including zip code and telephone number, including area code, of agent for service) Table of Contents to gather safety data and measure any early signal of clinical benefit. Phase 3 clinical trials will be designed to confirm the tolerability and magnitude of clinical benefit in a larger number of subjects. The following table sets forth our highest priority clinical programs: Overview of Clinical and Pre-clinical Programs Our most advanced clinical programs are in MDS and CRC. Proceeds from this offering will advance the MDS program and our earlier-stage programs in ovarian cancer and HBV. Advancing the CRC program will require additional financing apart from this offering. Myelodysplastic Syndromes (MDS) MDS is a form of cancer of bone-marrow stem cells resulting in fewer than normal mature blood cells in the circulation. In MDS, bone marrow becomes dysplastic, or defective. The blood cells produced do not develop normally, such that too few healthy blood cells are released into the blood stream, which leads to low blood cell counts, or cytopenias. Thus, many patients with MDS require frequent blood transfusions. In most cases, the disease worsens and the patient develops progressive bone marrow failure. In advanced stages of the disease, immature blood cells, or blasts, leave the bone marrow and enter the blood stream, leading to AML, which occurs in approximately one-third of patients with MDS. We believe that there is a medical need for a treatment option that improves outcomes of standard of care regimens for patients with MDS. A Phase 1/2 investigator-initiated clinical trial in AML, MDS and acute lymphoblastic leukemia, or ALL, is ongoing at the University of Pennsylvania and 23 study subjects have been treated with birinapant as the sole agent or administered with hydroxyurea (if deemed necessary by the treating physician). The majority of subjects enrolled are elderly (over 70 years) with AML secondary to MDS and have received multiple prior treatments. In preliminary data, the treatment-related adverse events included Grade 3 and Grade 4 increases in serum levels of the digestive enzymes amylase and lipase, as determined by laboratory testing, with no subject-reported symptoms of abdominal pain. The preliminary data also shows reductions in leukemic blasts (tumor bulk) in some subjects. There were increases in the normal white blood cells, or neutrophils, with the first birinapant dose in some subjects. One subject continued on treatment with birinapant as sole agent for approximately Copies to: Jeffrey P. Libson, Esq. Steven J. Abrams, Esq. Brian Korn, Esq. Pepper Hamilton LLP 3000 Two Logan Square 18th and Arch Streets Philadelphia, PA 19103 (215) 981-4000 Brent B. Siler, Esq. Andrew S. Williamson, Esq. Brian F. Leaf, Esq. Cooley LLP 11951 Freedom Drive Reston, VA 20190 (703) 456-8000 Table of Contents 10 months. Based on the synergy we observed in pre-clinical studies between birinapant and azacitidine, the current standard of care for MDS, and the action of birinapant in subjects with AML secondary to MDS, in August 2013, we initiated a Phase 1 clinical trial of birinapant administered with azacitidine in higher-risk MDS subjects who have relapsed or do not respond to treatment with, or are refractory to, azacitidine. We expanded this clinical trial to include subjects who have not been previously treated with, or are na ve to, azacitidine. We plan to enroll 15 to 20 subjects in a dose escalation phase to determine the recommended dose of birinapant administered with azacitidine for further trials. Subject enrollment is expected to be completed in the first half of 2014. We intend to commence a randomized Phase 2 clinical trial in the first half of 2014 of birinapant administered with azacitidine versus azacitidine alone in first-line higher-risk MDS subjects. Colorectal Cancer (CRC) CRC is the most deadly cancer in the U.S. among non-smokers and the second most deadly cancer overall. The American Cancer Society estimates that in the U.S. there will be approximately 142,000 new cases and approximately 51,000 deaths from CRC in 2013, accounting for 9% of all cancer deaths. Almost 50% of the patients with a new diagnosis of CRC will die within five years. According to the National Cancer Institute, or NCI, the prevalence of CRC in the U.S. in 2010 was estimated to be 1.2 million cases. CRC is the third most common cancer in both men and women. The risk of CRC increases with age; 90% of cases are diagnosed in individuals 50 years of age or older. Despite effective screening, leading to a reduction in the mortality from CRC, the number of cases remains high and is expected to increase worldwide to 2.2 million by the year 2030. We believe that there is a medical need for a treatment option that improves outcomes of standard of care regimens for patients with CRC. We have results of a Phase 1/2 clinical trial of birinapant administered with irinotecan in 71 CRC subjects who had previously failed standard chemotherapies. The trial has not been formally closed because one subject continues on treatment without disease progression for over 21 months. The clinical trial showed activity, with six subjects (8%) showing partial responses, or PRs, defined as at least a 30% decrease in the sum of all measurable tumor lesions by Response Evaluation Criteria in Solid Tumors, or RECIST. RECIST is a set of published rules that define when cancer patients improve (or respond), stay the same (or stabilize), or worsen (or progress) during treatment. The median progression-free survival, or PFS, was 2.2 months. Thirty-four percent of study subjects were alive without progression of their tumor at four months and 21% were alive without progression of their tumor at six months. The combination of birinapant administered with irinotecan was generally well tolerated. Compared to treatment with irinotecan alone, birinapant administered with irinotecan led to a modest increase in anemia (or a decrease in red blood cells) and a modest increase in thrombocytopenia (or a decrease in platelets). As noted above, irinotecan is one of the chemotherapies that induces TNF. As the majority of subjects had disease progression on prior irinotecan treatment (65 of 71, or 92%), we believe that this data supports the view that the activity seen in this study is being driven by the synergistic effect of birinapant and irinotecan. Based on the clinical data that has emerged from the study of birinapant administered with irinotecan, a randomized clinical trial is planned in third-line CRC subjects, meaning those who have already failed two prior treatment regimens for advanced disease to commence enrollment, subject to our ability to obtain additional financing apart from this offering. Ovarian Cancer In pre-clinical studies, we observed synergy between birinapant and TRAIL receptor agonist antibodies. In collaboration with Amgen, we will explore the combination of birinapant administered with Amgen's TRAIL receptor agonist antibody, conatumumab. We have an open IND for a Phase 1/2 ovarian cancer trial and intend to begin enrolling subjects before the end of 2013. Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the "Securities Act"), check the following box. If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission acting pursuant to said Section 8(a), may determine. Table of Contents Hepatitis B Virus (HBV) Hepatitis B is a liver disease that results from infection with HBV. In pre-clinical studies, birinapant significantly reduced HBV. The clearance was additive when given in combination with entecavir, the standard of care therapy for HBV. We intend to continue pre-clinical studies and regulatory activities and intend to start a Phase 1 clinical trial in the fourth quarter of 2014. Biomarkers In connection with our clinical programs, we are conducting research to uncover biomarkers, or biological parameters that can be measured to characterize a disease state or the effect of therapy, that can be used to identify subjects most likely to respond to birinapant. These studies are focused on detecting IAP gene amplification in different tumor types, on examining the expression of genes important in the TNF/IAP/NF-kB pathway and on examining the activation status of NF-kB itself. Our Strategy Our goal is to maximize the potential value of birinapant as a first-in-class and best-in-class SMAC-mimetic. The key elements of our strategy to achieve this goal include: pursuing regulatory approval for birinapant administered with other therapies for the treatment of first-line higher-risk MDS. We intend to initiate a randomized Phase 2 clinical trial in the first half of 2014. The data from the randomized Phase 2 clinical trial will determine the size of the treatment effect of birinapant administered with azacitidine versus azacitidine alone and will form the basis of a Phase 3 clinical trial in first-line higher-risk MDS; pursuing regulatory approval for birinapant administered with irinotecan for treatment of third-line CRC. We plan to initiate a randomized clinical trial upon the availability of additional financing apart from this offering; commencing a Phase 1/2 clinical trial by the end of 2013 with birinapant administered with conatumumab in ovarian cancer; continuing our pre-clinical studies of birinapant as a potential antiviral therapeutic agent, with the intent of starting an antiviral clinical program in the fourth quarter of 2014; and considering collaborations to accelerate development of our clinical programs outside of the U.S. Other elements of our business strategy include exploiting our understanding of the role of SMAC-mimetics more broadly in infectious disease, leveraging our library of SMAC-mimetic compounds to develop novel molecules to expand the utility of this developing class and pursuing potential collaborations, in-licensing or acquisitions of assets and companies to expand our existing technologies and operations.
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, especially the Risk Factors section beginning on page 11 and our consolidated financial statements and the related notes appearing at the end of this prospectus, before making an investment decision. As used in this prospectus, unless the context otherwise requires, references to we, us, our and BIND refer to the consolidated operations of BIND Therapeutics, Inc. and its consolidated subsidiaries. Overview We are a clinical-stage nanomedicine platform company developing Accurins, our novel targeted and programmable therapeutics. Accurins are designed with specified physical and chemical characteristics to target specific cells or tissues and concentrate a therapeutic payload at the site of disease to enhance efficacy while minimizing adverse effects on healthy tissues. Our strategy is to leverage our medicinal nanoengineering platform to develop our own pipeline of Accurins, initially in oncology, as well as Accurins in collaboration with biopharmaceutical companies. Our lead drug candidate, BIND-014, is in Phase 2 clinical trials for non-small cell lung cancer, or NSCLC, and metastatic castrate-resistant prostate cancer, or mCRPC. To date in 2013, we have announced collaborations with Amgen, Pfizer and AstraZeneca to develop Accurins based on therapeutic payloads from their product pipelines, with the potential to achieve a total of over $1 billion in upfront and future milestone payments, including over $450 million in pre-commercial milestones. Our management team has extensive experience in the development, regulatory approval and commercialization of nanotechnology drugs. Currently, the two leading nanotechnology cancer drugs are Doxil, a liposomal doxorubicin, and Abraxane, an albumin nanoparticle paclitaxel. Our chief executive officer was the president and chief operating officer of SEQUUS Pharmaceuticals, Inc., the company that developed and commercialized Doxil. Both our chief medical officer and our head of regulatory affairs served in those roles at Abraxis Bioscience, Inc., the company that developed Abraxane. Our platform originated from the pioneering nanotechnology research at the Massachusetts Institute of Technology and Brigham and Women s Hospital/Harvard Medical School of our scientific founders and directors Dr. Robert Langer and Dr. Omid Farokhzad. Our scientists and engineers continue to advance this technology to produce the next generation of targeted nanomedicines. The challenge for all drugs is to maximize the net clinical benefit by increasing the desired therapeutic effect and reducing adverse effects. This is especially difficult in cancer, where the goal is to destroy or inhibit growth of cancer cells without damaging similar healthy cells. The first generation of cancer drugs were cytotoxic chemotherapies, such as Taxotere, which achieved limited selectivity by targeting mechanisms responsible for cell proliferation, a key characteristic of cancer cells. The mechanisms responsible for cell proliferation are also a property of healthy cells, which can lead to significant adverse effects when healthy cells are destroyed. Biopharmaceutical companies have developed more selective drugs, which we refer to as targeted therapies, such as Herceptin and Gleevec by targeting proteins found at higher levels on the surface of cancer cells or by inhibiting dysregulated biochemical pathways inside cancer cells. More recently, drugs such as Kadcyla have increased efficacy by linking toxins and antibodies to deliver targeted cytotoxicity. While these newer drugs were an improvement in targeting cancer cells relative to normal tissue, there continues to be a need to develop drugs with increased net clinical benefit. We believe Accurins represent the next stage in the evolution of cancer therapy. Accurins are nanoparticles containing a therapeutic payload and are designed to target tumors at three levels: tissue, cellular and molecular. They combine this triple targeting with a prolonged circulation time to concentrate the therapeutic payload at the targeted disease site, where it is then released in a controlled and timely manner. Accurins have the potential to significantly increase the net clinical benefit of the therapeutic payload and result in efficacy and safety not currently achievable through other therapeutic approaches. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED SEPTEMBER 19, 2013 PRELIMINARY PROSPECTUS 4,700,000 Shares Common Stock This is the initial public offering of our common stock. Prior to this offering, there has been no public market for our common stock. The initial public offering price of our common stock is expected to be between $14.00 and $16.00 per share. Our common stock has been approved for listing on the NASDAQ Global Select Market under the symbol BIND. The underwriters have an option to purchase a maximum of 705,000 additional shares of common stock from us. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012 and, as such, have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. Investing in our common stock involves a high degree of risk. See Risk Factors beginning on page 11. Price to Public Underwriting Discounts and Commissions(1) Proceeds to BIND Therapeutics Per Share $ $ $ Total $ $ $ (1) See Underwriting beginning on page 153 for additional information regarding underwriting compensation. Certain affiliates of our directors and other principal stockholders have indicated an interest in purchasing an aggregate of approximately $14.7 million in shares of our common stock in this offering at the initial public offering price. However, because indications of interest are not binding agreements or commitments to purchase, the underwriters may determine to sell more, less or no shares in this offering to any of these stockholders, or any of these stockholders may determine to purchase more, less or no shares in this offering. Delivery of the shares of common stock will be made on or about , 2013. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Credit Suisse Cowen and Company Stifel JMP Securities The date of this prospectus is , 2013 Table of Contents Our lead Accurin drug candidate, BIND-014, is a prostate-specific membrane antigen, or PSMA, targeted Accurin that contains docetaxel. PSMA is a clinically-validated tumor marker expressed on prostate cancer cells and the blood vessels of many types of non-prostate solid tumors, including NSCLC. Docetaxel, marketed as Taxotere, is one of the most commonly used cancer chemotherapy drugs. It is approved by the U.S. Food and Drug Administration, or FDA, for the treatment of breast cancer, NSCLC, mCRPC, head and neck cancer, and gastric cancer. Taxotere achieved global sales of approximately $3 billion in 2009, the year prior to its loss of marketing exclusivity in the United States, and generic docetaxel continues to be a mainstay in cancer treatment despite its significant side effects. These side effects include neutropenia, anemia, infection, fluid retention and edema, neuropathy, rash, mucositis, fatigue, muscle weakness, nail loss, hair loss and even death. We are in Phase 2 clinical trials to evaluate the level of clinical activity of BIND-014 in NSCLC and mCRPC and expect to report data from these studies in the second half of 2014. To date, we have clinically tested BIND-014 in over 45 patients with advanced or metastatic cancer who failed prior therapies. In our Phase 1 clinical trial, of the 28 patients who received BIND-014 once every three weeks, there have been one complete response in a patient with cervical cancer and three partial responses in patients with NSCLC, mCRPC and ampullary cancer. A complete response generally refers to the disappearance of all signs of cancer in response to treatment, while a partial response generally refers to a decrease in the size of the tumor or in the extent of cancer in the body. Five additional patients had stable disease lasting longer than 12 weeks. In our preclinical studies, BIND-014 has demonstrated that its ability to destroy tumor cells is differentiated from, and superior to, Taxotere. In addition to our internal development programs, we also consider opportunities to collaborate with recognized biopharmaceutical companies to develop Accurins incorporating therapeutic payloads from their proprietary product portfolios. Our collaborations with industry leaders, including announced agreements with Amgen, Pfizer and AstraZeneca, provide us with the opportunity to develop Accurins with a broader range of therapeutic payloads than we could on our own. Our collaboration agreements generally require the collaborator to pay all the development costs associated with the Accurin, including those incurred by us. In addition, the upfront and potential milestone payments under these agreements provide us with additional capital resources to develop our own proprietary pipeline of Accurins. We expect that at least one of our collaborations will advance an Accurin into the clinic by the end of 2014. Accurins We believe Accurins represent the next stage in the evolution of targeted therapies and nanomedicine. Table of Contents TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights selected information from this prospectus but may not contain all of the information that may be important to you. Accordingly, we encourage you to read carefully this entire prospectus. In this prospectus, the words "Seven Arts", "Company", "we", "our", "ours" and "us" refer to Seven Arts Entertainment Inc., our listing predecessor Seven Arts Pictures PLC ("PLC") and our subsidiaries, unless otherwise stated or the context otherwise requires. The shares of common stock referenced are stated after the 1-for-70 reverse stock split that occurred on August 31, 2012, the 1-for-50 stock split on May 2, 2013, and the 1-for-20 stock split on October 16, 2013. The financial statements and all other financial data included herein are presented in U.S. dollars ($). In this Prospectus, the word "Group" refers to Seven Arts Entertainment Inc. and its subsidiaries listed in Corporate Organization. Our Company We are an independent motion picture production company engaged in developing, financing, producing and licensing theatrical motion pictures with budgets generally in the range of $2 million to $15 million for exhibition in domestic (i.e., the United States and Canada) and foreign theatrical markets and for subsequent post- theatrical worldwide release in other forms of media, including DVD, home video, pay-per-view, and free television. Our motion pictures will either receive only a limited theatrical release, or may even be released directly to post-theatrical markets, primarily DVD. Those pictures that receive either a limited theatrical release or a post-theatrical release typically benefit from lower prints and advertising ("P & A") costs. Recent domestic theatrical releases of our motion pictures include Deal (April 2008), Noise (May 2008), Autopsy (January 2009), Night of the Demons (October 2010), The Pool Boys (September 2011) and Drunkboat (July 2012), all of which received limited United States theatrical releases. We released one motion picture in 2013, Nine Miles Down, and expect to release Schism in March of 2014 . We currently have three motion pictures in development that we anticipate will be released within the next two to three years (i.e., 2015 – 2017), Romeo Spy, The Winter Queen and Neuromancer. We may supplement these motion pictures releases with certain lower cost pictures not yet fully developed, as well as with selected third-party acquisitions. In the last year, we have engaged in development activities on our motion picture projects Winter Queen and Neuromancer (e.g. writing of scripts, preparation of budget, arranging cast and technical, talent, scouting locations), which will have production budgets of approximately $20 million and $60 million, respectfully. By reason of the production costs, underlying material and creative elements attached (director and actor), we believe these larger budget motion pictures will obtain a substantial theatrical release in the United States and international territories such as United Kingdom, Germany, Japan, France, Spain and Australia but there can be no assurance that we will achieve this objective. We have also developed three lower budget motion pictures and acquired two as part of our distribution strategy. We do not yet have firm commitment for the financing and production of the motion picture projects described above. We have no assurance that we will be able to finance production of these motion pictures but expect to do so within the next 18 months. We are currently negotiating financing and distribution arrangements for each project but none is complete. No assurance can be made regarding the timing of financing, completion and delivery on any motion picture we seek to finance and distribute. The "pre-sale" licensing market has become increasingly difficult to access as a film financing device and may materially affect our ability to finance and distribute our films. We currently control copyright interests, directly or through affiliates, for 27 completed motion pictures. An additional 12 motion pictures for which we own distribution rights are now controlled by Arrowhead Target Fund Ltd. ("Arrowhead"), a former hedge fund investor, which receives all of the revenues from these pictures until recoupment of current indebtedness. We are attempting to negotiate an agreement with Arrowhead to re-acquire the licenses of all these 12 motion pictures; however, we cannot provide any assurances that we will be able to reach any such agreement. A substantial portion of our library revenues are derived from only a few of our library titles. On February 23, 2012, we executed definitive agreements to acquire the music assets of David Michery (dated as of December 19, 2011) and 100% of the stock of Big Jake Music (dated as of September 29, 2011). On February 23, 2012, we gained control of the music assets and BJM, although the transactions were negotiated by our listing predecessor and were agreed as well as publicly announced on the effective dates described. As a result, we are now an independent distributor and producer of sound recordings. Mr. Michery s assets include (i) 52 completed sound recordings, embodying the performances of established urban recording artist DMX and the right to record and distribute two additional albums embodying DMX s performance and (ii) up to five albums embodying the performance of established urban act Bone Thugs-N-Harmony, the first of which, Art of War III has been delivered to us. DMX s first album for Seven Arts Music, Undisputed , was released on September 11, 2012. The Company has obtained an executed record distribution agreement with Fontana Distribution which is now in full force and effect. The Company recorded total revenues of $1,522,808 and a net loss after tax of $22,062,539 for the fiscal year ended June 30, 2013, compared to total revenues of $4,058,006 (restated) and a net loss of $11,153,464 (restated) for the fiscal year ended June 30, 2012. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered Proposed Maximum Aggregate Offering Price Per Share (1) Proposed Maximum Aggregate Offering Price Amount of Registration Fee Common Stock, $0.01 par value per share 25,000,000 $ 0.03 $ 610,410 $ 83.26 (1) The proposed maximum aggregate price has been estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. Subject to completion, dated November [__], 2013. SEVEN ARTS ENTERTAINMENT INC. SUBJECT TO COMPLETION, DATED JANUARY (22), 2013 $610,410 25,000,000 shares of Common Stock This Prospectus relates solely to the registration of shares of the Company s common stock underlying warrants that the Company granted to its record and beneficial stockholders as of the close of the markets on August 31, 2012 (immediately prior to our reverse stock split) issuable on the date registration of Prospectus is effective with the Securities and Exchange Commission. For each 10 pre-reverse split shares of our common stock that were owned by our stockholders as of such date, we granted one warrant (a "Warrant") for the purchase of one post-reverse split share of our common stock, exercisable at a price to be determined by our Board of Directors at such time as this Prospectus is deemed effective, per post-reverse split share (a "Warrant Share"). We did not distribute any Warrants prior to the date of this Prospectus. The Warrants are non-transferrable and, accordingly, we do not expect that a secondary market for the Warrants will develop or be maintained. Our common stock is quoted on the OTC BB and the OTC Market Group Inc. s OTCQB tier under the symbol "SAPX." On November 11, 2013 , the last reported sale price of a share of our common stock was $0.0070 . Investing in our securities involves a high degree of risk. See "Risk Factors" on page 8 of this Prospectus and in any documents incorporated by reference in this Prospectus for a discussion of the factors you should carefully consider before deciding to purchase these securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The date of this Prospectus is November [__], 2013. As of July 1, 2010, PLC agreed in an Asset Transfer Agreement of that date to transfer certain of its assets (including ownership of the one operating subsidiary) to us, in exchange for assumption by us of certain of its indebtedness. This transfer was agreed to by PLC s shareholders at an Extraordinary General Meeting on June 11, 2010. The purpose of this transfer was to eliminate the Group s status as a foreign private issuer and to assume compliance with all obligations of a U.S. domestic issuer under all applicable state and Federal securities laws. The transfer of assets and liabilities was completed effective January 27, 2011, and NASDAQ trading of our common stock, succeeding to PLC s ordinary shares, commenced on September 1, 2011. Trading of our common stock on The NASDAQ Capital Market was suspended at the opening of business on September 14, 2012, due to our not meeting the $1 minimum bid price stock listing requirement of The NASDAQ Stock Market for ten trading days prior to September 20, 2012, the expiration date on the Company s six-month extension to meet this listing requirement. On September 14, 2012 our common stock began being quoted on the OTC Market Group Inc. s OTCQB tier under our historical symbol "SAPX." Our Business Strategy The Company s current business strategy is: To finance, produce and distribute two to four motion pictures per year with budgets of between $2 million and $15 million each. As previously stated, these pictures will receive only a limited theatrical release. There can be no assurance as to the number of theaters or "print & advertising" expenditures we will be able to arrange on any of these motion pictures. The Company s next motion picture to be released is expected to be Schism in March 2014. To acquire and distribute sound recordings throughout the world, both as singles .and albums of both established and new recording artists. We expect to release 3 to 4 albums per calendar year, including albums by the established urban artists DMX, the next one early in 2014, and Bone Thugs-N-Harmony, in December 2013. To supplement our core strategy by producing an occasional higher cost motion picture (production budgets of $30 - $60 million). We will seek to license such projects to a major studio to guarantee a studio-wide release and obtain a commitment to cover a portion or all of P&A costs as well as other distribution expenses, although no such agreement has yet been completed. To opportunistically acquire distribution rights to an additional two to five motion pictures produced by others, each year, for distribution in theatrical, video and television markets, as an agent, for a 15%-20% fee. We have acquired three motion pictures in the twelve months pursuant to this strategy. To maximize our current use of tax-preferred financing structures around the world to fund our motion picture productions. To enter into arrangements with theatrical and video distributors, to gain more control over and increase our share of the revenues from distribution of our motion pictures by decreasing distribution fees, approval over distribution strategy and distribution costs, and shorter license terms. We have entered into such arrangements in the United States, United Kingdom and Spain in the last twelve months. To expand our library of completed motion pictures, sound recordings, and musical compositions. Competitive Strength The Company s competitive strengths include: The experience of our management and our relationships with independent motion picture distributors. Our relationships with "key talent" (e.g., writer, director, actor and producer) and with independent motion picture distributors around the world. Our experience in structuring tax-preferred financings. Our exclusive recording agreements with DMX and Bone Thugs-N-Harmony. Warrants and Exercise Thereof This Prospectus provides for issuance and re-sale of shares of our common stock to be issued to holders of record on August 31, 2012 of our common stock, on the exercise of warrants ("Warrants") to be issued to each such holder on the effectiveness of this Prospectus. Warrants may be exercised at the election in writing of the holder as with payment of the exercise price of $.___ per share at any time on or before December 31, 2014. As a result, this Offering is a continuous offering until expiration of the warrants. TABLE OF CONTENTS Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes and the information set forth under the headings "Risk Factors" and "Management s Discussion and Analysis of Financial Condition and Results of Operations," in each case included elsewhere in this prospectus.
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001436174_american_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001436174_american_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary contains basic information about us and the resale of the securities being offered by the selling stockholder. You should read this entire prospectus carefully, including the section entitled Risk Factors and our financial statements and the notes to the financial statements, before making an investment decision. This summary is qualified in its entirety by the more detailed information and the financial statements and related notes. The terms American Power, Company, we, our, and us refer to American Power Corp. and its subsidiaries, unless the context suggests otherwise. The Company We are an independent company and our primary business focus is to acquire, explore and develop coal, oil and gas properties in the United States, with a particular focus on the Rocky Mountains region. We have acquired certain coal and mineral rights located in Judith Basin County, Montana, collectively described as the PACE Coal Property. These rights are speculative in nature and additional exploration work is required to determine their value. Our PACE Coal Property and other uncontrolled properties make up the PACE Coal Project. We plan to explore the PACE Coal Property and acquire and explore new properties, including the uncontrolled properties necessary to develop the mine plan, that we believe are prospective for coal and/or hydrocarbons. Our planned exploration drilling program on the PACE Coal Property consists of 61 drilling sites and involves a total of 53,875 feet of drilling in three different phases (which are discussed in more detail below), of which 14,076 feet of drilling and 18 drill sites have been completed to date. All Phase I and Phase II drilling operations and one drill hole corresponding to Phase III of our exploration program have been completed. Drilling operations were suspended in December 2011 due to weather considerations and are expected to resume in the spring of 2013 after finding capable drilling contractors and securing adequate financing. Our technical team has designated 14 Phase III drill holes as priority drill holes. These priority drill holes are expected to further define mineralization, provide additional coal quality data, and provide information to determine if any remaining Phase III drill holes will require coring. We commissioned the preparation of a preliminary Mine Feasibility Study for the PACE Coal Project with the project data obtained during the 2011 drilling season and data from previous exploration work carried out by Mobil Oil Co. This preliminary study was completed by our engineering consultant Weir International, Inc. ( Weir ) in September 2012. Controlled property in the PACE Coal Project is comprised of acreage where the Company owns the coal and mineral rights but not the surface rights. Uncontrolled property in the PACE Coal Project is comprised of acreage where the Company owns neither the coal and mineral rights nor the surface rights; thus, the uncontrolled property will have to be successfully acquired by purchase or lease to develop the mine plan. The Mine Feasibility Study includes information on the geology and mineralization of the PACE Coal Project, a mine plan suitable to geology and production requirements and projections for production capacity, productivity, staffing levels, equipment and facilities, capital expenditures, operating costs and coal sales. According to the preliminary Mine Feasibility Study, 191.3 million tons of coal are expected to be produced over a 15-year mine life. At full production, the mine plan projects annual production of thermal coal at 7.9 million saleable tons (14.9 million ROM tons) per year, utilizing three continuous miner units and one longwall mining unit. Capital expenditures are estimated at approximately $402 million for future initial mine development and $730 million for sustaining capital over the 15-year mine plan. In addition, we estimate the cost of leasing uncontrolled coal properties to be $5.5 million plus royalties to be calculated as a percentage of actual production. The PACE Coal Project clean coal quality, based on the exploration data, is projected to be 11,750 Btu/lb and 2.28 percent sulfur (3.88 Lbs SO2/MBtu). The calorific value (Btu/lb) is among the highest in the major coal producing regions in the western United States. Upon completion of Phase III of our planned exploration drilling program, we expect to obtain a final reserve study setting forth the quantity and classification of proven and probable coal reserves and a valuation thereof and final mine feasibility study by the summer of 2013. These final studies will incorporate the drilling results of all three phases of the exploration program. In light of our current financial condition, we are also exploring other potential strategic alternatives, including joint venture arrangements or the sale of the PACE Coal Property. We have not yet established an ongoing source of revenues sufficient to cover our operating costs and planned exploration activities and, for the years ended September 30, 2012 and 2011, we had net losses of $1,735,586 and $1,952,064, respectively. As such, our independent registered public accounting firm has included in its auditor s report an explanatory paragraph that states that our continuing losses from operations raise substantial doubt as to our ability to continue as a going concern. Our principal executive offices are located at 16 Market Square Center, 1400 16th Street, Suite 400, Denver, CO 80202. Our telephone number is (720) 932 8389. About This Offering On February 17, 2012, we entered into a Standby Equity Distribution Agreement, which was subsequently amended and restated on June 13, 2012 (the SEDA ) with YA Global pursuant to which we may, at our sole and exclusive option, periodically sell to YA Global shares of our Common Stock for a total purchase price of up to four million dollars ($4,000,000). Each sale of Common Stock, pursuant to an advance notice under the SEDA (each an advance notice ), will be limited to the greater of (1) $250,000 and (2) the average of the daily value traded for each of the 10 trading days prior to the applicable advance notice. For each share of Common Stock purchased pursuant to the SEDA, YA Global will pay us ninety five (95%) of the market price, defined as the average of the two lowest daily volume weighted average price of the Common Stock during the five (5) consecutive trading days following delivery by us of an advance notice, which price will not be less than 90% of the volume weighted average price on the trading day prior to the advance notice date. Under the SEDA, we cannot sell shares of Common Stock until such time as the registration statement of which this prospectus forms a part is declared effective by the SEC. We are not obligated to sell any shares of Common Stock under the SEDA and there are no minimum commitments or minimum use penalties. The SEDA terminates automatically twenty-four months from the date that this registration statement becomes effective. We anticipate receiving the full $4,000,000 available under the SEDA over the term of the SEDA, though we will need to file additional registration statements with the SEC to register more shares in order to do so. We anticipate utilizing the funds received under the SEDA for: - the repayment of a promissory due to JBM Energy, which has a current principal balance of $1,350,000 and bears interest at a rate of 5% per annum, and pursuant to which we are obligated to make payments to JBM Energy of (A) $100,000 upon the earlier of (i) sixty (60) days following the effective date of the registration statement of which this prospectus forms a part and (ii) March 9, 2013 and (B) monthly payments of $100,000 plus accrued interest commencing on April 9, 2013 and continuing until full repayment in April 2014. - the repayment of a promissory due to Pace, which has a current principal balance of $1,550,000 and bears interest at a rate of 5% per annum, and pursuant to which we are obligated to make payments to Pace of (A) $100,000 upon the earlier of (i) sixty (60) days following the effective date of the registration statement of which this prospectus forms a part and (ii) March 9, 2013, (B) $200,000 upon the earlier of (i) ninety (90) days following the effective date of the registration statement of which this prospectus forms a part and (ii) March 9, 2013 and (C) monthly payments of $100,000 plus accrued interest commencing on April 9, 2013 and continuing until full repayment in April 2014; - approximately $250,000 for payment of outstanding accounts payable; - approximately $500,000 for the completion of Phase III of the exploration drilling program in Judith Basin County; - approximately $200,000 for the preparation of a final reserve study, mine feasibility study and market study; and - approximately $200,000 for general corporate purposes. As filed with the Securities and Exchange Commission on February 27, 2013. Registration No. 333 182309 Based on the current market price of $0.07, we would receive gross proceeds of approximately $1.04 million from the sale of the 15,700,000 shares covered by this registration statement. Given that the expected gross proceeds from the sale of the shares covered by this registration statement are lower than our funding requirements for the current fiscal year, we will have to prioritize the allocation of those proceeds until we can obtain additional funding. We plan to first use these proceeds to pay amounts due to Pace and JBM Energy on March 9, 2013 (approximately $460,000) and April 9, 2013 (approximately $210,000). We plan to use approximately $250,000 of these proceeds to pay a portion of our outstanding accounts payable, and approximately $70,000 to continue to fund Phase III of the exploration drilling program, with the remaining proceeds to be used for general corporate purposes. Additional funding for the Company could be obtained under the SEDA (upon the filing and effectiveness of an additional registration statement), the Stock Issuance Agreement with Black Sands Holdings, Inc. dated September 10, 2010 or other sources available in the market. The Stock Issuance Agreement with Black Sands Holding, Inc. terminates on March 31, 2013; however it may be extended for an additional term of up to twelve months at the option of the Company or Black Sands Holdings, Inc. On February 17, 2012, we issued to YA Global an aggregate of 734,394 shares (the Commitment Fee Shares ) of Common Stock as complete payment of a $120,000 commitment fee in connection with the contemplated transactions. In accordance with the SEDA, we agreed to register for resale the Commitment Fee Shares and a number of shares to be issued under the SEDA. Therefore, we have prepared and filed this prospectus for the purpose of registering the resale by YA Global of the 734,394 Commitment Fee Shares currently owned by YA Global and up to 14,965,606 shares of Common Stock to be issued pursuant to the SEDA, but we do not know when or whether, or at what price, any or all of the shares may be sold. In the event that we wish to sell shares to YA Global under the SEDA in excess of the number of shares covered by this registration statement, we would need to file a new registration statement to cover those shares. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S 1 (Amendment No. 3) REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 (Exact name of registrant as specified in its charter) Nevada 26 0693872 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number) 16 Market Square Center 1400 16th Street Suite 400 Denver, CO 80202 (720) 932 8389 (Phone) Alvaro Valencia President and Chief Executive Officer American Power Corp. 16 Market Square Center 1400 16th Street Suite 400 Denver, CO 80202 (720) 932 8389 (Phone) (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) (Address, including zip code, and telephone number, including area code, of agent for service) Copies to: Michelle Shepston Davis Graham & Stubbs LLP 1550 17th Street, Suite 500 Denver, Colorado 80202 303 892 9400 (Phone) 303 892 7400 (Fax) Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement as determined by market conditions. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. x
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001452751_nimble_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001452751_nimble_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001482080_cellular_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001482080_cellular_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..68efd42eed0f51e18fc35bf409ae0b65848ca42b
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+Prospectus summary This summary highlights selected information appearing elsewhere in this prospectus and does not contain all the information you should consider before investing in our common stock. You should carefully read this prospectus in its entirety before investing in our common stock, including the section entitled Risk factors, and our financial statements and related notes included elsewhere in this prospectus. Overview We develop and manufacture fully functioning human cells in industrial quantities to precise specifications. Our proprietary iCell Operating System (iCell O/S) includes true human cells in multiple cell types (iCell products), human induced pluripotent stem cells (iPSCs) and custom iPSCs and iCell products (MyCell products). Our iCell O/S products provide standardized, easy-to-use, cost-effective access to the human cell, the smallest fully functioning operating unit of human biology. Customers use our iCell O/S products, among other purposes, for drug discovery and screening; to test the safety and efficacy of their small molecule and biologic drug candidates; for stem cell banking; and in researching cellular therapeutics. Our iCell product line currently includes four different cell types: cardiomyocytes, neurons, hepatocytes and endothelial cells. We are actively developing an additional seven different cell types, and we expect to use our platform to continue to expand the iCell product line. iCell products are a consumable designed to be used once and then reordered. We manufacture our iCell products from our iPSCs. An iPSC is a cell that has the ability both to replicate indefinitely and to be transformed into any cell type in the human body. We develop and manufacture our iPSCs from ordinary blood or skin using proprietary techniques that expand upon those pioneered by our founder Dr. James A. Thomson. Once we produce an iPSC, it becomes a renewable source of starting material for our iCell products and stem cell banks. Scientists need access to cellular models that accurately represent the human biology they want to study. Our human cells reproduce, rather than approximate, the operation of the fully functioning human cell. We design our iCell O/S products to empower our customers to: Increase the productivity of their in vitro therapeutic research and development. Pursue novel avenues of biological discovery. Accelerate the regulatory analysis and market introduction of clinical products. Improve quality control of manufactured clinical products. Perform more precise applied and environmental testing. Build or augment stem cell banks. Develop and commercialize in vivo cellular therapeutics. Our customers include biopharmaceutical companies, government research institutions, academic and nonprofit research institutions, clinical research organizations and stem cell banks. In 2012, we sold our products to 18 of the top 20 biopharmaceutical companies (based on worldwide revenue) and grew our customer base to 128 from 60 in 2011. We attribute our growing success to the following differentiating factors: Enabling unparalleled access to human cellular biology. We believe our iCell O/S products: afford researchers superior insight into how human cells react to drug candidates and other Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to completion, dated July 19, 2013 Prospectus 3,846,000 shares Common stock This is the initial public offering of common stock by Cellular Dynamics International, Inc. We are offering 3,846,000 shares of common stock pursuant to this prospectus. We expect the initial public offering price to be between $12.00 and $14.00 per share. No public market currently exists for our common stock. Our common stock has been approved for listing on the NASDAQ Global Market under the symbol ICEL. Per share Total Initial public offering price $ $ Underwriting discounts and commissions $ $ Proceeds, before expenses, to us(1) $ $ (1) We have agreed to reimburse the underwriters for certain FINRA-related expenses. See Underwriting. Certain of our existing shareholders and certain affiliates of us, certain existing shareholders and our directors have indicated an interest in purchasing shares of our common stock in this offering at the initial public offering price. We have requested that the underwriters allocate shares in this offering to these investors. It is not currently anticipated that the aggregate purchase price of the shares to be purchased by these investors in this offering will exceed $10 million. However, because indications of interest are not binding or commitments to purchase, these persons or entities may determine to purchase fewer shares than they have indicated an interest in purchasing or not purchase any shares in this offering. We have granted the underwriters an option for a period of 30 days to purchase up to 576,900 additional shares of common stock. We are an emerging growth company as that term is defined under the Jumpstart Our Business Startups Act of 2012 and, as such, we have elected to comply with certain reduced public company reporting requirements. Investing in our common stock involves a high degree of risk. See Risk factors beginning on page 12. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Delivery of the shares will be made on or about , 2013. Sole book running manager J.P. Morgan Co-managers Cowen and Company Leerink Swann , 2013 Table of Contents chemicals; enable customers to build or augment stem cell banks; and will allow us to design and manufacture cells to precise specifications for developers of cellular therapeutics for their therapeutic candidates. Disruptive technology addressing multiple, large markets. Our iCell O/S products displace existing surrogate models. Our products are currently sold into the $3.5 billion market for cells for in vitro experiments, as well as the $1.3 billion stem cell banking market. Our products position us well to participate in the growing $5.0 billion global human stem cell, tissue and organ therapy market, first as a provider of cells for research, then as a provider of cells for therapeutic trials and potentially for therapeutic use on a collaborative basis. We believe our products will contribute to the growth of our target markets. Full product solution. Our iCell O/S products are designed to be easy-to-use. Our iCell products are standardized, highly pure and manufactured in large volumes to precise specifications. iCell products are packaged as units that fill industry standard 96-well plates. Currently, three of the four iCell products are cryopreserved and may be stored for extended periods of time. Our cells are also validated on life science research platforms commonly used in laboratories. Lastly, we offer training and support for all of our products. Broad and deep intellectual property portfolio. We own or license a portfolio of intellectual property rights related to our technology that exceeds 700 patents and patent applications in the United States and around the world. From our inception, our intellectual property strategy has been designed to afford our customers and ourselves freedom to operate for all the products we sell. In addition, we have exclusively licensed and developed intellectual property and technical know-how that we maintain as trade secrets. We believe that our intellectual property portfolio will provide significant competitive advantages for future business operations. Our target markets The target markets for our products include cells for in vitro drug discovery, toxicity testing and chemical safety; stem cell banking; and in vivo and cell-based therapeutic research. Total expenditures in these markets were approximately $17.1 billion in 2011 and are expected to increase to $40.5 billion by 2020, according to Adivo Associates. Cells for in vitro use in drug discovery, toxicity testing and chemical safety Cells for in vitro use refers to cells studied under laboratory culture conditions for the purpose of drug discovery, toxicity testing and chemical safety analysis. The total spent on cell-based technologies for in vitro use was approximately $10.8 billion in 2011, of which $3.5 billion was spent on cells. By 2020, these markets are expected to grow to $14.7 billion and $5.6 billion, respectively. Customers in this market include: biopharmaceutical companies; government research institutions; academic and nonprofit research institutions; and clinical research organizations. Stem cell banking The stem cell banking market was approximately $1.3 billion in 2011, and is expected to grow to $4.4 billion in 2020. Currently, government entities, academic institutions and industry are Table of Contents Table of contents Prospectus summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001510333_zika_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001510333_zika_prospectus_summary.txt
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+PROSPECTUS SUMMARY As used in this prospectus, unless the context otherwise requires, we, us, our, and WNS Studios, Inc. refers to WNS Studios, Inc. The following summary is not complete and does not contain all of the information that may be important to you. You should read the entire prospectus before making an investment decision to purchase our common stock. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act ( JOBS Act ). Although we have been in existence for four years, we have never offered securities pursuant to a registration statement prior to this prospectus. The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the Risk Factors section, the financial statements and the notes to the financial statements. THE COMPANY Corporate Background: WNS Studios, Inc. was incorporated under the laws of the State of Nevada on May 15, 2009. We are a development stage company, formed to act as a production agent to promote, sell and distribute studio films. From our inception to date, we have not generated any revenues, and our operations have been limited to organizational, start-up, and capital formation activities. We currently have no agreements or contracts in place to act as a production agent for any film or television studio. We have never intended and do not intend to be a blank check company. We have a specific business plan and do not intend to engage in any merger, acquisition or business reorganization with any entity. Our offices are currently located at WNS Studios, Inc., 3811 13th Avenue, Brooklyn, NY 11218, telephone: 718-907-4105. We do not have an internet website. Intellectual Property: We have no intellectual property. Employees: We currently have no employees other than our sole officer and director. Going Concern Considerations: The Company is a development stage company and has not commenced planned principal operations. The Company has no revenues and has incurred a net loss of $42,102 for the fiscal year ended April 30, 2013 and a net loss of $98,784 for the period May 15, 2009 (inception) to July 31, 2013. In addition, the Company has a working capital deficiency of $16,467 and stockholders' deficiency of $85,393 at April 30, 2013 and a working capital deficiency of $21,120 and a stockholders deficiency of $97,524 at July 31, 2013. The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.These factors raise substantial doubts about the Company s ability to continue as a going concern, and our independent auditors included an explanatory paragraph regarding this uncertainty in their report on our financial statements for the period May 15, 2009 (inception) to April 30, 2013. The Company has the ability to borrow up to $126,275 from P&G Holdings LLC, an entity owned 33% by our sole officer and director. As of July 31, 2013, we borrowed $76,404 from P&G Holdings. Accordingly, the Company currently has the ability to borrow up to an additional $49,871 from P&G. There can be no assurance that sufficient funds required in the future will be generated from operations or that funds will be available from external sources such as debt or equity financings or other potential sources. The lack of additional capital resulting from the inability to generate cash flow from operations or to raise capital from external sources would force the Company to substantially curtail or cease operations and would, therefore, have a material adverse effect on its business. Furthermore, there can be no assurance that any such required funds, if available, will be available on attractive terms or that they will not have a significant dilutive effect on the Company s existing stockholders. THE OFFERING Securities Being Offered: 250,000 shares of common stock. Price Per Share: $0.20 Duration of the Offering: The offering shall terminate on the earlier of (i) the date when the sale of all 250,000 shares of common stock is completed; (ii) one year from the date of this prospectus; or (iii) prior to one year at the sole determination of the board of directors. Gross Proceeds $50,000 Common Stock Currently Issued and Outstanding: There are 4,500,000 shares of common stock issued and outstanding as of the date of this prospectus, of which 3,600,000 or 80% are held solely by our sole officer and director, Moses Gross. Common Stock Issued and Outstanding if we are successful at selling all the shares offered in this offering: 4,750,000 Subscriptions All subscriptions once accepted by us are irrevocable. Registration Costs We estimate our total offering registration costs to be approximately $15,000. If we raise $15,000 or less in the offering, all proceeds from the offering will be used to cover all or any portion of our offering expenses. Market for the common shares: There has been no market for our securities. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the FINRA for our common stock to eligible to be quoted trading on the Over The Counter Bulletin Board ( OTC Bullentin Board ). We do not yet have a market maker who has agreed to file such application. There is no guarantee that our common stock will be eligible for quotation on the OTC Bulletin Board. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale. Use of proceeds: The net proceeds will be used by us for working capital, including legal and accounting fees to maintain our reporting requirements with the Securities and Exchange Commission.
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001513520_visionary_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001513520_visionary_prospectus_summary.txt
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+the related notes appearing elsewhere in this prospectus before deciding whether to purchase notes. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from any results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Overview We are a leading global provider of information and risk management solutions. We provide these solutions to businesses across multiple industries and to individual consumers. Our technology and services enable businesses to make more timely and informed credit granting, risk management, underwriting, fraud protection and customer acquisition decisions by delivering high quality data, integrated with analytics and decisioning capabilities. Our interactive website provides consumers with real-time access to their personal credit information and analytical tools that help them understand and proactively manage their personal finances. Over a million unique consumers visit our website each month. We have operations in the United States, Africa, Canada, Latin America, Asia Pacific and India and provide services in 33 countries. Since our founding in 1968, we have built a diversified and stable customer base in multiple industries, including financial services, insurance, healthcare, automotive, retail and communications. Businesses use our data for their daily risk-management processes. Consumers use our data to help them understand their credit profile and protect themselves against identity theft. We obtain financial, credit, identity, bankruptcy, lien, judgment, insurance claims, automotive and other relevant information from thousands of sources, including credit-granting institutions, private databases and public records depositories, much of which is provided to us at little or no cost. We refine and enhance this data to create proprietary databases, processing approximately two billion updates monthly in the United States. We combine our data with our analytics and decisioning technology to deliver additional value to our customers. Our analytics, such as predictive modeling and scoring, customer segmentation, benchmarking and forecasting, enable businesses and consumers to efficiently monitor and manage risk. Our decisioning technology, which is delivered on a software-as-a-service platform, enables businesses to interpret data and scores and apply their specific qualifying criteria to make real-time decisions at the point of interaction with their customers. Collectively, our data, analytics and decisioning technology allow businesses to more effectively identify and acquire new customers, manage risk associated with existing customers, generate cross-selling opportunities and reduce loss from fraud and identity theft. We have a global customer base that includes many of the largest companies in each of the primary industries we serve. For example, in the United States, we contract with eight of the ten largest banks, all of the major credit card issuers, nine of the ten largest property and casualty insurance carriers and we provide services to thousands of healthcare providers. In addition, we provide subscription-based interactive services to a growing base of over one million consumers. We manage our business through three operating segments: U.S. Information Services ( USIS ), International and Interactive. USIS, which represented approximately 64% of our revenue in 2012, and 63% of our revenue in the six months ended June 30, 2013, provides consumer reports, credit scores, verification services, analytical services, revenue management and decisioning technology to businesses in the United States. USIS offers these services to customers in the financial services, insurance, healthcare and other industries, and delivers them through both direct and indirect channels. Table of Contents Table of Registrant Guarantors Exact Name of Registrant Guarantors as Specified in Its Charter State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Address, Including Zip Code and Telephone Number, Including Area Code, of Registrant Guarantor s Principal Executive Offices Diversified Data Development Corporation. California 95-2902153 555 West Adams Street Chicago, IL 60661 (312) 985-2000 TransUnion Corp. Delaware 74-3135689 555 West Adams Street Chicago, IL 60661 (312) 985-2000 TransUnion Healthcare LLC Delaware 27-1491512 555 West Adams Street Chicago, IL 60661 (312) 985-2000 TransUnion Interactive, Inc. Delaware 13-4117314 555 West Adams Street Chicago, IL 60661 (312) 985-2000 TransUnion Rental Screening Solutions, Inc.. Delaware 52-2139271 555 West Adams Street Chicago, IL 60661 (312) 985-2000 TransUnion TeleData LLC Oregon 20-5618633 555 West Adams Street Chicago, IL 60661 (312) 985-2000 Visionary Systems, Inc.. Georgia 58-2255788 555 West Adams Street Chicago, IL 60661 (312) 985-2000 Table of Contents Under the terms of the indenture relating to the notes, the Issuers have agreed that, whether or not we are required to do so by the rules and regulations of the SEC, for so long as any of the notes remain outstanding, we will furnish to the trustee and holders of the notes the information specified in the indenture. See Description of the Notes. Forward-Looking Statements This prospectus contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any statements made in this prospectus that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include information concerning possible or assumed future results of operations, including descriptions of our business plans and strategies. These statements often include words such as anticipate, expect, suggest, plan, believe, intend, continue, estimate, target, project, forecast, should, could, would, may, will and other similar expressions. We base these forward-looking statements on our current expectations, plans and assumptions that we have made in light of our experience in the industry, as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances and at the time such statements were made. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those expressed in the forward-looking statements. Factors that may materially affect such forward-looking statements include: macroeconomic and industry trends and adverse developments in the debt, consumer credit and financial services markets; our ability to maintain the security and integrity of our data; our ability to deliver services timely without interruption; our ability to maintain our access to data sources; government regulation and changes in the regulatory environment; litigation or regulatory proceedings; our ability to effectively develop and maintain strategic alliances and joint ventures; our ability to make acquisitions and integrate the operations of other businesses; our ability to timely develop new services; our ability to manage and expand our operations and keep up with rapidly changing technologies; our ability to manage expansion of our business into international markets; economic and political stability in international markets where we operate; our ability to effectively manage our costs; our ability to provide competitive services and prices; our ability to make timely payments of principal and interest on our indebtedness; our ability to satisfy covenants in the agreements governing our indebtedness; our ability to maintain our liquidity; fluctuations in exchange rates; changes in federal, state, local and foreign tax laws; Table of Contents International, which represented approximately 20% of our revenue in 2012, and 20% of our revenue in the six months ended June 30, 2013, provides services similar to our USIS and Interactive segments, and provides services in 32 countries outside the United States. Our International segment also provides automotive information and commercial data to our customers in select geographies. Interactive, which represented approximately 16% of our revenue in 2012, and 17% of our revenue in the six months ended June 30, 2013, provides services to consumers that help them understand and proactively manage their personal finances and protect them from identity theft. We sell our subscription-based interactive services primarily through our website, www.transunion.com. Our Industry Evolution to mission critical role. Credit bureaus were formed in the nineteenth century to help provide better credit information to local and regional lenders so they could make more informed credit decisions. As consumer lending expanded, credit bureaus became an integral part of the lending process and now play a critical role in the intermediation between lenders and borrowers. Credit bureaus developed a variety of methods to collect, maintain and analyze information concerning the ability of consumers and businesses to meet their obligations. Consumers and commercial lenders have increasingly used these services to make more informed credit decisions. As a result, credit bureaus have positioned themselves as mission critical partners to financial services institutions around the world. Three major providers with sustainable competitive advantage. As financial services institutions grew in scale and geographic scope, credit bureaus extended their reach by coordinating and forming strategic alliances with other credit reporting providers to share data across large territories through a hub and spoke system. Three credit bureaus have since consolidated into large, international organizations that can provide a wide range of data services and analytical applications to their larger and increasingly demanding financial services customers. As a result of this consolidation, TransUnion, Equifax and Experian have emerged as the global leaders in the industry. The largest U.S. customers of these global credit bureaus typically use the services of all three providers to validate consistency and ensure reliability. Development of the business information service providers. Over the past decade, credit bureaus have devoted significant resources to enhance the quality of their data sets by developing a variety of proprietary information databases. Credit bureaus have evolved from being collectors and sellers of credit information to providers of more advanced information services. Given the increased consumer demand for monitoring their own credit, the credit bureaus have also begun to market and sell these services directly to consumers. The development of these more advanced services has enabled credit bureaus to diversify their revenue base, accelerate growth and evolve into business information service providers. Market Opportunity We believe several important trends in the global macroeconomic environment, as well as within the key industries we serve, are driving development of the market for information and risk management solutions. Large and Growing Market for Data and Analytics. We believe that the business information services market is large and growing. We believe that the demand for targeted data and sophisticated analytical tools will continue to grow meaningfully as businesses seek real-time access to more granular data in order to better understand their customers. Table of Contents The information in this prospectus is not complete and may be changed. We may not offer or sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, SEPTEMBER 18, 2013 Prospectus Trans Union LLC TransUnion Financing Corporation 11.375% Senior Notes due 2018, Series B The 11.375% Senior Notes due 2018, Series B were issued by Trans Union LLC and TransUnion Financing Corporation, which we refer to together as the Issuers, in exchange for the 11.375% Senior Notes due 2018 originally issued by the Issuers on June 15, 2010. The 11.375% Senior Notes due 2018, Series B are referred to herein as the 11.375% notes, or the notes, unless the context otherwise requires. The notes bear interest at a rate of 11.375% per annum and mature on June 15, 2018. We are registering the notes under the Securities Act of 1933 for market-making transactions, as described below. The notes will mature on June 15, 2018. The Issuers have the option to redeem all or a portion of the notes at any time on or after June 15, 2014 at the redemption prices set forth in this prospectus plus accrued and unpaid interest. The Issuers also have an option to redeem all or a portion of the notes at any time before June 15, 2014, at a redemption price equal to 100% of the aggregate principal amount of the notes to be redeemed plus a make-whole premium and accrued and unpaid interest. The notes are the Issuers senior unsecured obligations and rank equal in right of payment with all of the Issuers existing and future senior debt. The Issuers parent company, TransUnion Corp., and each of TransUnion Corp. s direct and indirect subsidiaries that guarantee Trans Union LLC s credit facilities have unconditionally guaranteed the notes on a senior unsecured basis with guarantees that rank pari passu in right of payment with all existing and future senior indebtedness of each entity. The notes and the guarantees are effectively subordinated to the existing and future secured indebtedness of the Issuers and guarantors to the extent of the value of the collateral securing such indebtedness. This prospectus includes additional information on the terms of the notes, including redemption and repurchase prices, covenants and transfer restrictions. There is no established trading market for the notes offered hereby. We do not intend to list the notes on any securities exchange or seek approval for quotation through any automated trading system. See Risk Factors beginning on page 15 for a discussion of certain risks that you should consider before investing in the notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and other affiliates of The Goldman Sachs Group, Inc. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Such affiliates of The Goldman Sachs Group, Inc. may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. GOLDMAN, SACHS & CO. The date of this prospectus is , 2013 Table of Contents our ability to protect our intellectual property; our ability to retain or renew existing agreements with long-term customers; our ability to access the capital markets; further consolidation in our end customer markets; reliance on key management personnel; and
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001516559_mansfield_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001516559_mansfield_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary highlights selected information contained in this prospectus. This summary does not contain all the information that may be important to you. You should read the more detailed information contained in this prospectus, including, but not limited to, the risk factors beginning on page 6. References to we, us, our, SW China Imports or the Company mean SW China Imports, Inc. Forward-Looking Statements This prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate , believe , plan , expect , future , intend and other similar expressions to identify such forward-looking statements. You should not place too much reliance on these forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in the "Risk Factors" section and elsewhere in this prospectus. Our Company SW China Imports was incorporated under the laws of the State of Nevada on February 23, 2011. Our business plan calls for the importation of high-end handmade lace wigs and hairpieces, as well as other beauty supplies and products, manufactured in China and South Korea into the United States. SW China Imports intends to sell these products in bulk to beauty supply stores, hair salons, and independent hair stylists. SW China Imports also intends to sell its products directly to the retail consumer via the Internet. It is important to note that we are a development stage business with minimal business activity. As of the date of this prospectus we have not begun importing any lace wigs, hairpieces, or beauty supplies. Further, we do not have any formal agreements in place with any beauty supply stores, hair salons, or independent hair stylists; our discussions with potential distributors have been limited solely to exploratory talks until we can demonstrate our ability to procure and deliver our products in a timely manner and in sufficient quantities. As of December 31 , 2012 we had not generated any revenue and have incurred ( $59,044,272 ) in losses since our inception on February 23, 2011, and have relied upon our directors and outside investors to fund our operations. Further, as of December 31 , 2012, we had a working capital deficiency of ( $39,509 ). We are a development stage company and we do not expect to generate revenue which would be sufficient to sustain our operations for at least the next 12 months. These and other factors raise substantial doubt about our ability to continue as a going concern. Accordingly, and for the foreseeable future, we will continue to be dependent on additional financing in order to maintain our operations and continue with our corporate activities. Due to the uncertainty of our ability to meet our financial obligations and to pay our liabilities as they become due, in their report dated February 11, 2013 in our audited financial statements for the fiscal year ended December 31, 2012 , our independent registered public accounting firm included additional comments indicating concerns about our ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Any investment in our common stock involves a high degree of risk. If we are unable to generate adequate revenue, we may be obliged to cease business operations due to a lack of operating capital. We face many challenges to continue operations, including our lack of operating history, lack of revenues to date, and the losses we have incurred to date. Please review the "Risk Factors" starting on page 6 of this prospectus and Liquidity and Capital Resources on page 21. As of the date of this prospectus, our sole officer and director, Seon Won, owns 59.4% of the issued and outstanding shares of our common stock. Accordingly, he will be able to determine the outcome of all corporate transactions or other matters, including mergers, consolidations, and the sale of all or substantially all of our assets. The interests of Mr. Won may differ from the interests of the other shareholders and thus result in corporate decisions that are disadvantageous to other shareholders. Our principal executive offices are located at 15800 Crabbs Branch Way, Ste. 310, Rockville, MD 20855 and our telephone number at that address is (240) 477-7738. This office space is being provided to us by our former treasurer and secretary, Jae Hwang, free of charge. As of the date of this prospectus, Mr. Hwang continued to own 7.8% of our issued and outstanding shares of common stock.
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001525773_intelsat_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001525773_intelsat_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001528540_ilfc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001528540_ilfc_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001548086_qgog_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001548086_qgog_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001555015_np-sunset_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001555015_np-sunset_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001555945_cbl_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001555945_cbl_prospectus_summary.txt
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+The following summary highlights some of the information in this prospectus. It may not contain all of the information that is important to you. To understand this offering fully, it is important that you read the entire prospectus carefully, including the "RISK FACTORS" and our financial statements and the notes accompanying the financial statements that appear elsewhere in this prospectus. Unless otherwise specifically noted, the terms "Company," "we," "us" or "our" refers to CBL RESOURCES INC. CORPORATE BACKGROUND AND INFORMATION CBL RESOURCES INC. CBL Resources Inc. was organized under the laws of the State of Nevada on June 1, 2012, to explore mineral properties in North America. CBL Resources Inc. is engaged in the exploration for gold and other minerals. The Company has acquired one mineral claim totaling 61.704 hectares. It is located on Northern Vancouver Island adjacent to Klootchlimmis Creek, about 15 kilometres to the southeast of the town of Port Alice on Northern Vancouver Island, BC, Canada. We refer to these mining claims as the Bluebird Gold Property. This property is without known reserves. The Bluebird Gold Property comprises one mineral claim containing 3 cell claim units totaling 61.704 hectares; BC Tenure # Work Due Date Units Total Area (Ha.) ----------- ------------- ----- ---------------- 1010955 July 10, 2013 3 61.704 We require an estimated total of $117,000 to implement the two phases of our exploration plan. We have not yet commenced our exploration plan. We are an exploration stage company and we have not realized any revenues to date. We do not have sufficient capital to enable us to commence and complete our exploration program. We will require financing in order to conduct the exploration program described in the section entitled, "Business of the Issuer." Our auditors have issued a going concern opinion, raising substantial doubt about CBL Resources Inc.'s financial prospects and the Company's ability to continue as a going concern. We are not a "blank check company," as we do not intend to participate in a reverse acquisition or merger transaction. Securities laws define a "blank check company" as a development stage company that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person. With its current assets, the Company can remain operational through 2013 if it does not complete Phase 1 of its program and only pays the government fees to keep the claims valid. However, the Company plans to raise the capital necessary to fund our business through a private placement and public offering of our common stock. The Company intends to work directly with private placees once this registration statement is declared effective. The Company anticipates that they will have either a private placement or additional funding from its founder by the end of 2013 in order to conducts its operations. Our offices are located at: EdificioTerramar, Torre 2000, 17D, Panama City, Panama. THE OFFERING Securities offered 5,000,000 shares of common stock Selling stockholder David Richer Offering price $0.002 per share Shares outstanding prior to the offering 12,000,000 shares of common stock Shares to be outstanding after the offering 12,000,000 shares of common stock Use of proceeds The Company will not receive any proceeds from the sale of the common stock by the selling stockholder. SUMMARY FINANCIAL INFORMATION The following tables set forth the summary financial information for the Company. You should read this information together with the financial statements and the notes thereto appearing elsewhere in this prospectus and the information under "Plan of Operation." CONSOLIDATED STATEMENTS OF INCOME Period Ended Period Ended August 31, November 30, 2012 2012 ---------- ---------- Revenues 0 0 Operating expenses 13,675 1,995 Net loss from operations 13,675 1,995 Net loss before taxes 13,675 1,995 Loss per share - basic and diluted 0.00 0.00 Weighted average shares outstanding basic 12,000,000 12,000,000 BALANCE SHEET DATA At At August 31, November 30, 2012 2012 ---------- ---------- Cash and cash equivalents 16,325 16,325 Total current assets 16,325 16,325 Total assets 16,325 16,325 Management Accrual Fee 0 1,995 Total liabilities 0 1,995 Common stock 12,000 12,000 Additional paid-in capital 18,000 18,000 Deficit accumulated during exploration period (13,675) (15,670) Total stockholders' equity 16,325 16,325
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001557796_that_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001557796_that_prospectus_summary.txt
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+PROSPECTUS SUMMARY AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, WE, US, OUR, AND VISTA HOLDING GROUP, CORP. REFERS TO VISTA HOLDING GROUP, CORP. THE FOLLOWING SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK. VISTA HOLDING GROUP, CORP. We are a development stage company and intend to commence operations in the business of development of 3D virtual tours and running a web guide of 3D virtual tours for public venues. We plan to conduct our proposed business and locate our prospective customers in Moscow, Russia. In the future when and if we have funds to expand our business, we will be targeting clients in other cities in Russia and Europe. Vista Holding Group, Corp. was incorporated in Nevada on August 2, 2012. We intend to use the net proceeds from this offering to develop our business operations (See Description of Business and Use of Proceeds ). To implement our plan of operations we require a minimum of $30,000 for the next twelve months as described in our Plan of Operations. We expect our operations to begin to generate revenues during months 6-12 after completion of this offering. However, there is no assurance that we will generate any revenue in the first 12 months after completion our offering or ever generate any revenue. Being a development stage company, we have very limited operating history. If we do not generate any revenue we may need a minimum of $10,000 of additional funding to pay for ongoing SEC filing requirements. We do not currently have any arrangements for additional financing. Our principal executive offices are located at Runovsky per., 11/13 str. 2, kv. 36, Moscow, Russia 115184. Our phone number is (702) 425-5735. From inception until the date of this filing, we have had limited operating activities. Our financial statements from inception (August 2, 2012) through February 28, 2013, reports no revenues and a net loss of $4,753. Our independent registered public accounting firm has issued an audit opinion for Vista Holding Group, Corp. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. To date, we have developed our business plan and entered into a consulting agreement with a consultant, Anton Kanin on October 27, 2012. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. We are currently considered a shell company within the meaning of Rule 12b-2 under the Exchange Act, in that we currently have nominal operations and nominal assets other than cash. Accordingly, the ability of holders of our common stock to re-sell their shares may be limited by applicable regulations. For us to cease being a shell company we must have more than nominal operations and more than nominal assets or assets which do not consist solely of cash or cash equivalents. Vista Holding Group, Corp. has no current plans to merge with another operating company. We do not anticipate earning revenues until we enter into commercial operation. Since we are presently in the development stage of our business, we can provide no assurance that we will successfully assemble, construct and sell any products or services related to our planned activities. We are not a blank check company and have no intention to engage in a merger or other type of business combination. THE OFFERING The Issuer: VISTA HOLDING GROUP, CORP. Securities Being Offered: 2,500,000 shares of common stock. Price Per Share: $0.02 Duration of the Offering: The shares will be offered for a period of two hundred and forty (240) days from the effective date of this prospectus. The offering shall terminate on the earlier of (i) when the offering period ends (240 days from the effective date of this prospectus), (ii) the date when the sale of all 2,500,000 shares is completed, (iii) when the Board of Directors decides that it is in the best interest of the Company to terminate the offering prior the completion of the sale of all 2,500,000 shares registered under the Registration Statement of which this Prospectus is part. Gross Proceeds $50,000 Securities Issued and Outstanding: There are 2,800,000 shares of common stock issued and outstanding as of the date of this prospectus, held by our sole officer and director, Tatiana Mironenko. If we are successful at selling all the shares in this offering, we will have 5,300,000 shares issued and outstanding. Subscriptions All subscriptions once accepted by us are irrevocable. Registration Costs We estimate our total offering registration costs to be approximately $8,000.
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001559165_coronation_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001559165_coronation_prospectus_summary.txt
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+The following summary highlights some of the information in this prospectus. It may not contain all of the information that is important to you. To understand this offering fully, it is important that you read the entire prospectus carefully, including the "RISK FACTORS" and our financial statements and the notes accompanying the financial statements that appear elsewhere in this prospectus. Unless otherwise specifically noted, the terms "Company," "we," "us" or "our" refers to CORONATION MINING CORP. CORPORATE BACKGROUND AND INFORMATION CORONATION MINING CORP. Coronation Mining Corp. was organized under the laws of the State of Nevada on May 31, 2012, to explore mineral properties in North America. Coronation Mining Corp. is engaged in the exploration for quartz and other minerals. The Company has acquired two Mineral Titles Online "MTO" mineral claim totaling 876.48 hectares. The Silver Tusk Property claims are situated 65 kilometers northwest of Vancouver, BC. Access is gained by travelling to Clowhom Falls at the head of Salmon Inlet by float plane light wheeled plane or by water taxi from Sechelt, BC. From Clowhom Falls the showings are located 26km by logging road in the Red Tusk valley. More immediate access is available by helicopter to one of three landing pads cleared along the baseline of the claims. We refer to these mining claims as the Silver Tusk Property. This property is without known reserves. To current date the Company has never commenced any operational/exploration activity other than issuing shares. The Silver Tusk Property comprises two MTO mineral claims containing 42 cell claim units totaling 876.48 hectares in area. BC Tenure # Work Due Date Units Total Area (Ha.) ----------- ------------- ----- ---------------- 984302 May 7, 2013 25 521.78 984322 May 7, 2013 17 354.70 ---- ------ 42 876.48 ==== ====== We require an estimated total of $250,000 to implement the three phases of our exploration plan. We have not yet commenced our exploration plan. We are an exploration stage company and we have not realized any revenues to date. We do not have sufficient capital to enable us to commence and complete our exploration program. We will require financing in order to conduct the exploration program described in the section entitled, "Business of the Issuer." Our auditors have issued a going concern opinion, raising substantial doubt about Coronation Mining Corp.'s financial prospects and the Company's ability to continue as a going concern. We are not a "blank check company," as we do not intend to participate in a reverse acquisition or merger transaction. Securities laws define a "blank check company" as a development stage company that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person. With its current assets, the Company can remain operational through 2012 if it does not complete Phase 1 of its program and only pays the government fees to keep the claims valid. However, the Company plans to raise the capital necessary to fund our business through a private placement and public offering of our common stock. The Company intends to work directly with private places once this registration statement is declared effective. The Company anticipates that they will have either a private placement or additional funding from its founder by the end of 2012 in order to conducts its operations. Our offices are located at: 12865 West Highway 40, Ocala, Florida, 34481 THE OFFERING Securities offered 15,000,000 shares of common stock Selling stockholder Stuart Carnie Offering price $0.002 per share Shares outstanding prior to the offering 30,000,000 shares of common stock Shares to be outstanding after the offering 30,000,000 shares of common stock Use of proceeds The Company will not receive any proceeds from the sale of the common stock by the selling stockholder. SUMMARY FINANCIAL INFORMATION The following tables set forth the summary financial information for the Company. You should read this information together with the financial statements and the notes thereto appearing elsewhere in this prospectus and the information under "Plan of Operation." STATEMENT OF INCOME Period Ended August 31, 2012 --------------- Revenues -- Operating expenses 5,675 Net loss from operations (5,675) Net loss before taxes (5,675) Loss per share - basic and diluted 0.000 Weighted average shares outstanding basic 30,000,000 BALANCE SHEET DATA At August 31, 2012 ------------------ Cash and cash equivalents 18,825 Total current assets 18,825 Mineral Property 8,500 Total Assets 27,325 Accounts payable 3,000 Current liabilities 3,000 Total liabilities 3,000 Common stock 30,000 Additional paid-in capital -- Deficit accumulated during exploration period (5,675) Total stockholders' equity 24,325 Total liabilities and stockholder's equity 27,325
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001560046_sqn-aif_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001560046_sqn-aif_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. It does not contain all of the information that may be important to you in making your investment decision. You should read this entire prospectus, including the Risk Factors section, before deciding to invest in our units. Throughout this prospectus when there is a reference to you it is a reference to you as a potential investor or limited partner in us.
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001561196_sport_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001561196_sport_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following is only a summary of the information, financial statements, and notes included in this prospectus. You should read the entire prospectus carefully, including Risk Factors and our financial statements and notes to the financial statements, before making an investment in Sport Stix Inc. Sport Stix, Inc. will contract with Conduit Flavoring Company, Inc. to manufacture the electrolyte drink mix called Sport Stix. Sport Stix contains no sugar, calories or carbohydrates. Sport Stix electrolytes are designed for anyone that needs to stay hydrated during athletic activities without all the calories and carbohydrates. The Company s principle objective with respect to this offering is to increase its capital in order to expand the operations of the Company. The Company has had no sales or distribution arrangements to date. We are not a shell company and do not intend to merge with or sell the company to a private operating company in a reverse merger transaction. EMERGING GROWTH COMPANY We are an Emerging Growth Company as defined in the Jump Start Our Business Start Ups Act. We shall continue to be deemed an emerging growth company until the earliest of: (a) The last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000. (As such amount is indexed for inflation every five years by the Commission to reflect the change in the Consumer Price Index for all urban consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000 or more; (b) The last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective Registration Statement under this title. (c) The date on which such issuer has during the previous three year period issued more than $1,000,000,000 in non-convertible debt; or (d) The date on which such issuer is deemed to be a large accelerated filer, as defined in Section 240.12b-2 of Title 17, Code of Federal Regulations, or any successor thereto. As an emerging growth company we are exempt from Section 404 (b) of Sarbanes Oxley. Section 404 (a) requires issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404 (b) requires that the registered accounting firm shall in the same report, attest to and report on the assessment on the effectiveness of the internal control structures and procedures for financial reporting. As an emerging growth company we are exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107 (b) of the Act. As a result we may become subject to Section 404(a) and be required to include a report on the effectiveness of our internal controls sooner which would in all likelihood increase our auditing fees. Subject to Completion, Dated August 6, 2013 The information in this prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PROSPECTUS SPORT STIX INC. 2,000,000 SHARES OF OUR COMMON STOCK This prospectus relates to the sale of up to 2,000,000 shares of common stock of Sport Stix Inc. by Sport Stix Inc. at $0.50 per share for a total amount of $1,000,000. We estimate net proceeds to be $960,000 for the total offering. All costs associated with this registration will be borne by Sport Stix Inc. Our common stock is not traded on any market or securities exchange. Common stock being registered in this Registration Statement may be sold by the Company at a fixed price of $0.50 per share. We know of no market makers for our common stock. The offering price may not reflect the market price of our shares after the offering. The shares will be offered and sold by our officers and directors without any discounts or other commissions on a best efforts basis. The proceeds of this Offering will not be deposited into an escrow account and there is no minimum subscription that must be reached before the Company can utilize the net proceeds of each subscription as such subscription is received and accepted by the Company. Therefore, funds will become immediately available to the Company. If we choose to sell our shares through broker/dealers, we will file a post effective amendment to this Registration Statement to identify the broker/dealers. This Offering will terminate in 180 days from the date of this Prospectus. Sport Stix Inc. can extend the offering for an additional 180 days at its sole discretion. Our common stock is deemed to be penny stock as that term is defined in Rule 3a51-1 promulgated under the Securities Act of 1934. Brokers/Dealers dealing in penny stocks are required to provide potential investors with a document disclosing the risks of penny stocks. Moreover, brokers/dealers are required to determine whether an investment in a penny stock is suitable investment for a prospective investor. THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT. SEE RISK FACTORS BEGINNING ON PAGE 3. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The date of this Prospectus is August 6, 2013.
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001561206_onepower_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001561206_onepower_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary is a shortened version of more detailed information, exhibits and financial statements appearing elsewhere in this prospectus. Prospective investors are urged to read this prospectus in its entirety. OnePower is a startup company, with its operations located in Lebanon, engaged in the development of an electronic bill delivery and payment system (the "OP SYSTEM") that will be designed with the intent to provide Middle Eastern utility companies with the ability to present bills and receive payment electronically. OnePower's mission is to become the leading provider of electronic bill delivery and payment services for all business-to-consumer transactions within the utility industry. OnePower plans to use the proceeds its raises from its offering to develop the OP Systems, establish a partnership with a target Middle Eastern utility company, market the OP System and its business, and sign up Middle Eastern utility companies to use the OP System. OnePower will not receive the entire $550,000 in gross proceeds unless the maximum number of shares is sold. To date OnePower has raised $17,000 via offerings completed between April 2010 and October 2010. The following table summarizes the date of offering, the price per share paid, the number of shares sold, and the amount raised for these two offerings. Closing Date Price Per Number of of Offering Share Paid Shares Sold Amount Raised ----------- ---------- ----------- ------------- April 1, 2010 $0.001 2,000,000 $ 2,000 October 15, 2010 $0.001 15,000,000 $15,000 OnePower has no revenues, has achieved losses since inception, has no operations, has been issued a going concern opinion by its auditor and relies upon the sale of its shares of common stock to fund its operations. NAME, ADDRESS, AND TELEPHONE NUMBER OF REGISTRANT OnePower Systems Ltd. Ain El-Mraisseh 73 Bliss Street, Qoreitem Bldg, 3rd Floor Beirut - Lebanon Telephone: (866) 906-7983 Facsimile: (866) 906-7983 THE OFFERING The following is a brief summary of this offering. Securities being offered to new and current investors: Up to a maximum of 10,000,000 shares of common stock with no minimum purchase. Securities being offered by selling shareholders: 15,000,000 shares of common stock (These shares are being registered by OnePower for resale on behalf of existing shareholders.) Offering price: $0.055 Offering period: The shares are being offered until June 1, 2014. Net proceeds to OnePower: Up to a maximum of $516,000 (if all 10,000,000 shares offered by OnePower are sold). Use of proceeds: Develop and market products and systems, set up business operations, obtain required licenses and permits, and establish a customer list. Number of shares outstanding before the offering: 17,000,000 Number of shares outstanding after the offering: 27,000,000 SUMMARY FINANCIAL INFORMATION The tables and information below are derived from OnePower's audited financial statements for the years ended November 30, 2012 and November 30, 2011 and its unaudited financial statements for the three month period ended February 28, 2013, respectively. OnePower had a working capital deficit of $(4881) as at November 30, 2012 and $(8,937) as at February 28, 2013. <TABLE> <CAPTION> FINANCIAL SUMMARY November 30, November 30, February 28, February 28, 2012 2011 2012 2011 -------- -------- -------- -------- $ $ $ $ <S> <C> <C> <C> <C> Cash 9,141 12,476 6,822 12,314 Total Assets 9,141 12,476 6,822 12,314 Total Liabilities 14,022 6,412 15,759 7,045 Total Stockholder's Equity (Deficit) (4,881) 6,064 (8,937) 5,269 STATEMENT OF OPERATIONS Accumulated From For the Three For the August 28, 2009 Month Period For the Three Month (Date of Inception) to Ended year ended Period Ended February 28, February 28, November 30, February 28, 2013 2013 2012 2012 -------- -------- -------- -------- $ $ $ $ Revenue -- -- -- -- Net Loss For the Period (25,937) (4,056) (10,945) (796) Net Loss per Share (0.00) (0.00) (0.00) (0.00) </TABLE> The book value of OnePower's outstanding common stock was $0.00 per share as at April 1, 2013.
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001562039_cst_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001562039_cst_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..e153798f857fdda9d4c6aa6b8bc6504273ae1e18
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+all historical periods described. Please see The Separation for a description of the separation. This summary is qualified in its entirety by the more detailed information contained elsewhere in this prospectus, which should be read in its entirety. Unless otherwise indicated, this prospectus assumes that the underwriters option to purchase additional shares will not be exercised. Our Company Overview We are one of the largest independent retailers of motor fuel and convenience merchandise items in the U.S. and eastern Canada. Our operations include (i) the sale of motor fuel at convenience stores, filling stations and cardlocks, (ii) the sale of convenience merchandise items and services at convenience stores and (iii) the sale of heating oil to residential customers and heating oil and motor fuel to small commercial customers. We have two operating segments: Retail U.S. As of June 30, 2013, we had 1,034 convenience stores located in Arkansas, Arizona, California, Colorado, Louisiana, New Mexico, Oklahoma, Texas and Wyoming; and Retail Canada As of June 30, 2013, we had 841 retail sites located in New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island and Qu bec. On May 1, 2013, Valero completed the separation of Valero s retail business and we became an independent public company. The separation was accomplished through a series of transactions in which the assets and liabilities associated with Valero s retail business were transferred to us or our subsidiaries. After the transfer of the Valero retail business to us, Valero effected a pro rata distribution of 80% of the outstanding shares of our common stock to Valero s stockholders. The remaining 20% of our common stock was retained by Valero, and 13,112,564 of such shares are being offered pursuant to this prospectus. Retail U.S. We sell motor fuel primarily under the Valero and Diamond Shamrock brands, convenience merchandise items and other services through convenience stores operated predominantly under the Corner Store name in nine states, with significant concentrations in Texas and Colorado. Most of these retail sites are located in metropolitan areas where there are high concentrations of consumers and daily commuters. Of these retail sites, as of June 30, 2013, 838 are owned and 196 are leased under leases that generally contain renewal options for periods ranging from five to ten years. We carry a broad selection of immediately consumable and take-home items, including beverages, tobacco products, snacks, freshly prepared and pre-packaged foods (including sandwiches, kolaches, tacos, salads, Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED NOVEMBER 4, 2013 13,112,564 Shares CST Brands, Inc. Common Stock This prospectus relates to the offer and sale of 13,112,564 shares of common stock, $.01 par value, of CST Brands, Inc. All of these shares of our common stock are currently held by Valero Energy Corporation ( Valero ). Valero, in its capacity as selling stockholder for federal securities law purposes, is offering the shares of our common stock if and to the extent Citicorp North America, Inc., which we refer to as the debt exchange party, acquires such shares from Valero prior to the completion of this offering in exchange for Valero s indebtedness held by the debt exchange party. See Underwriting (Conflicts of Interest). The debt exchange party will then sell the shares of our common stock to the underwriters and the underwriters will sell the shares of our common stock pursuant to this offering. Under the federal securities laws, Valero will be deemed the selling stockholder and an underwriter of any of the shares sold in this offering. However, the debt exchange party, and not Valero, will receive the cash proceeds from the offering. The debt exchange party will also be deemed an underwriter in this offering. The debt exchange party, Citicorp North America, Inc., is an affiliate of Citigroup Global Markets Inc., which is the representative of the underwriters in this offering. We will not receive any proceeds from the sale of shares of our common stock in the offering. Our common stock trades on the New York Stock Exchange under the symbol CST. On November 1, 2013, the last reported sale price of our common stock on the New York Stock Exchange was $33.01 per share. The underwriters have an option to acquire a maximum of up to 1,966,884 additional shares from the debt exchange party as described in Underwriting (Conflicts of Interest). Neither we nor Valero will receive any of the proceeds from the shares of common stock sold pursuant to the underwriters option to purchase additional shares. Investing in our common stock involves a high degree of risk. Before buying any common stock, you should carefully read the discussion of material risks of investing in our common stock in Risk Factors beginning on page 15. Price to Public Underwriting Commission Paid by Valero Proceeds to Debt Exchange Party, Before Expenses Per Share $ $ $ Total $ $ $ Delivery of the shares of common stock will be made on or about November , 2013. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Joint Book-Running Managers Citigroup Wells Fargo Securities J.P. Morgan Mizuho Securities RBC Capital Markets Co-Managers Credit Suisse Mitsubishi UFJ Securities Piper Jaffray PNC Capital Markets LLC RBS Scotiabank SMBC Nikko SunTrust Robinson Humphrey The date of this prospectus is November , 2013 Table of Contents FORWARD LOOKING STATEMENTS Forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act ), and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act ), are made throughout this prospectus. This prospectus includes forward-looking statements, including in the sections entitled Summary,
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001562214_zais_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001562214_zais_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus: references in this prospectus to we, us or our company refer to HF2 Financial Management Inc.; references in this prospectus to Highbury refer to Highbury Financial Inc.; references in this prospectus to our public shares refer to shares of our Class A Common Stock sold in this offering (whether they are purchased in this offering or thereafter in the open market) and references to public stockholders refer to the holders of our public shares, including our sponsors (as defined below) to the extent our sponsors purchase public shares, provided that their status as public stockholders shall only exist with respect to such public shares; references in this prospectus to our Class A Common Stock refer to our Class A common stock, par value $0.0001 per share; references in this prospectus to our Class B Common Stock refer to our Class B common stock, par value $0.000001 per share; references in this prospectus to our common stock refer to our Class A Common Stock and Class B Common Stock; references in this prospectus to our founders shares refer to the 4,398,750 shares of our Class A Common Stock purchased by our sponsors in December 2012 and February 2013 for an aggregate of $25,845; references in this prospectus to our management or our management team refer to our officers and directors; references in this prospectus to our sponsors refer to our initial stockholders prior to this offering; references in this prospectus to our sponsors shares refer to the 1,414,874 shares of our Class A Common Stock (or 1,598,400 shares of our Class A Common Stock if the the underwriters exercise their over-allotment in full) our sponsors have committed to purchase at a price of $10.00 per share; references in this prospectus to taxes or tax obligations refer to income, franchise or other tax obligations of any kind; and except as specifically provided otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not, and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted. General We are a blank check company formed under the laws of the State of Delaware on October 5, 2012. We were formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination, which we refer to throughout this prospectus as our initial business combination, with one or more businesses or entities, which we refer to throughout this prospectus as a target Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MARCH 21, 2013 PRELIMINARY PROSPECTUS HF2 Financial Management Inc. $153,000,000 15,300,000 Shares of Class A Common Stock HF2 Financial Management Inc. is a blank check company formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination, which we refer to throughout this prospectus as our initial business combination, with one or more businesses or entities, which we refer to throughout this prospectus as a target business. Our efforts to identify an initial business combination will not be limited to a particular industry or geographic region, although we intend to focus on companies operating in the financial services industry. We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any discussions, formal or otherwise, with respect to such a transaction. If we are unable to consummate our initial business combination within 18 months from the date of this prospectus (or 24 months from the date of this prospectus if we have executed a letter of intent, agreement in principle or definitive agreement for an initial business combination within 18 months from the date of this prospectus but have not completed the initial business combination within such 18-month period), we will redeem 100% of the public shares for a pro rata portion of the trust account described below. This is an initial public offering of our Class A Common Stock. We are offering 15,300,000 shares at an offering price of $10.00. We have also granted the underwriters a 45-day option to purchase up to an additional 2,295,000 shares to cover over-allotments, if any. We will seek stockholder approval of our initial business combination at a meeting called for such purpose at which public stockholders may seek to convert their shares, regardless of whether they vote for or against the proposed business combination, into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable and interest income), subject to the limitations described herein. We will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 upon such consummation (after giving effect to the payment of a cash advisory fee to EarlyBirdCapital, Inc. and Sandler O Neill & Partners, L.P. that is due upon consummation of our initial business combination) and a majority of the outstanding shares of Class A Common Stock voted are voted in favor of the business combination. Our sponsors have committed to purchase from us an aggregate of 1,414,875 shares of Class A Common Stock at a price of $10.00 per share (for a total purchase price of $14,148,750) in a private placement that will occur simultaneously with the consummation of this offering. Our sponsors also have agreed that if the over-allotment option is exercised by the underwriters, they will purchase from us at a price of $10.00 per share the number of shares of Class A Common Stock (up to a maximum of 183,525 shares of Class A Common Stock) that is necessary to maintain in the trust account an amount equal to $10.50 per share sold to the public in this offering. These shares will be purchased in a private placement that will occur simultaneously with the purchase of shares resulting from the exercise of the over-allotment option. There is presently no public market for our shares of Class A Common Stock. We have applied to have our shares listed on the Nasdaq Capital Market, or Nasdaq, under the symbol HTWO . We cannot assure you that our shares will continue to be listed on Nasdaq following this offering. We are an emerging growth company under the federal securities laws and will be subject to reduced public company reporting requirements. Investing in our shares involves a high degree of risk. See Risk Factors beginning on page 22 of this prospectus for a discussion of information that should be considered in connection with an investment in our shares. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Price to Public Underwriting Discounts and Commissions(1) Proceeds, Before Expenses, to us Per Share $ 10.00 $ 0.29 $ 9.71 Total $ 153,000,000 $ 4,437,000 $ 148,563,000 (1) Please see the section titled Underwriting for further information relating to the underwriting arrangements agreed to between us and the underwriters in this offering. Upon consummation of this offering, an aggregate of $160,650,000 or $10.50 per share sold to the public in this offering (or $184,747,500 if the over-allotment option is exercised in full) will be deposited into a United States-based trust account at UBS Financial Services Inc., maintained by Continental Stock Transfer & Trust Company, acting as trustee. Except as described in this prospectus, these funds will not be released to us until the earlier of the completion of our initial business combination and our redemption of our public shares (which may not occur until , 2015). The underwriters are offering the shares on a firm commitment basis. EarlyBirdCapital, Inc., acting as the representative of the underwriters, expects to deliver the shares to purchasers on or about , 2013. EarlyBirdCapital, Inc. Sandler O Neill + Partners, L.P. , 2013 Table of Contents business. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any target business on which to concentrate our search for our initial business combination. None of our officers, directors, promoters, Advisory Board members and other affiliates has engaged in discussions on our behalf with representatives of other companies regarding the possibility of a potential merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with us, nor have we, nor any of our agents or affiliates, been approached by any candidates (or representatives of any candidates) with respect to a possible business combination with us. We intend to focus our search on businesses that may provide significant opportunities for attractive investor returns. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic region, although we intend to focus on companies operating in the financial services industry where our management team has significant experience. Our officers, consisting of R. Bruce Cameron, our Chairman of the Board, Richard S. Foote, our President and Chief Executive Officer, and R. Bradley Forth, our Executive Vice President and Chief Financial Officer, share a common background at Berkshire Capital Securities LLC, or Berkshire Capital, an investment bank focused on providing advice to financial institutions. Over Berkshire Capital s 30-year history, its partners have developed long-term relationships with a wide range of U.S. and foreign private and public financial services organizations of all sizes. We believe these relationships will provide us with exposure to a broad population of potential acquisition targets. In January 2006, Highbury Financial Inc., a blank check company founded by our management and certain of our sponsors including R. Bruce Cameron, Richard S. Foote, R. Bradley Forth and Broad Hollow LLC, consummated its initial public offering, raising approximately $46.5 million. In November 2006, Highbury acquired the U.S. mutual fund business of ABN AMRO and subsequently rebranded the acquired business as Aston Asset Management LLC, or Aston. Aston is a mutual fund investment management firm that offers mutual funds and separately managed accounts through sub-advisory partnerships with high quality investment management firms. Highbury worked with Aston s management team to build and strengthen the business, including closing or merging 11 mutual funds and launching 16 new mutual funds. Highbury also introduced new sub-advisors to the Aston management team and provided $6.9 million of seed capital to launch new Aston mutual funds. Aston s assets under management increased from approximately $5.5 billion at the time of the acquisition in November 2006 to approximately $7.3 billion at the end of March 2010. In April 2010, Highbury was sold to Affiliated Managers Group, Inc., or AMG, in a tax-deferred stock-for-stock transaction. See Proposed Business Introduction for additional information regarding Highbury. R. Bruce Cameron served as Chairman of the Board of Directors of Highbury from its inception until its acquisition by AMG. Richard S. Foote served as President and Chief Executive Officer and a Director of Highbury from its inception until its acquisition by AMG. R. Bradley Forth served as Executive Vice President and Chief Financial Officer of Highbury from its inception until its acquisition by AMG. We will have until 18 months from the date of this prospectus (or 24 months from the date of this prospectus if we have executed a letter of intent, agreement in principle or definitive agreement for an initial business combination within 18 months from the date of this prospectus but have not completed the initial business combination within such 18-month period) to consummate our initial business combination. If we are unable to consummate our initial business combination within such time periods, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account and then seek to dissolve and liquidate. We expect the per share redemption price to be $10.50 per share of Class A Common Stock, without taking into account any interest earned on such funds, which will be distributed to pay our tax obligations and to meet our working capital requirements. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. Table of Contents PROSPECTUS SUMMARY 1
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+SUMMARY OF OUR OFFERING OUR BUSINESS We were incorporated on October 22, 2012. We are an exploration stage corporation engaged in the search for oil and gas. Our business plan is to develop oil and gas leases with the intent of reworking older drilled wells which are not currently producing, but still have the well-bore in place. Due to the higher price of crude oil and natural gas and utilizing new technology the wells can be reworked with the intent of making them profitable. We have no revenues, have a loss since inception, have minimal operations, have been issued a going concern opinion and rely upon the sale of our securities and loans from our officer and director to fund operations. Our mailing address is located at 2316-A Willemar Avenue, Courtenay, B.C. V9N 3M8, Canada and our telephone number is (250) 898 8882. This is the home of Lawrence Jean, our president. We use approximately 100 square feet on a rent free basis. Our registered statutory office is located at 711 S. Carson Street, Suite 4, Carson City, Nevada 89701. There is no current public market for our securities. As our stock is not publicly traded, investors should be aware they probably will be unable to sell their shares and their investment in our securities is not liquid. THE OFFERING Following is a brief summary of this Offering: Following is a brief summary of this Offering: Securities being offered A minimum of 3,000,000 of common stock and a maximum of 6,000,000 shares of common stock, par value $0.001. Offering price per share $0.01 Offering period The shares are being offered for a period not to exceed 180 days. Net proceeds to us $30,000, assuming the minimum number of shares are sold and $60,000, assuming the maximum number of shares are sold. Use of proceeds We will use the proceeds to pay for offering expenses, research and exploration. Number of shares outstanding before the Offering 7,500,000 Number of shares outstanding after the Offering if all of the shares are sold 13,500,000
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+PROSPECTUS SUMMARY The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements appearing elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in the ADSs discussed under "Risk Factors," before deciding whether to buy our ADSs. Our Business We are a leading global digital cinema solutions provider with the largest installed base of digital cinema servers in the Asia-Pacific region and the second largest globally as of March 31, 2013. In the first quarter of 2013, we became the global market leader by capturing the largest market share of incremental digital cinema servers installations on a worldwide basis. We develop, manufacture and sell digital cinema servers that meet the highly demanding performance, security and reliability requirements established by Hollywood studios. Since our inception, we have shipped over 25,000 digital cinema servers worldwide. We also partner with other manufacturers to offer a one-stop solution for exhibiting digital cinema content, including integrated projection systems and 3D products. We have the largest installed base of digital cinema servers in a number of territories, including China, Japan, South Korea, Taiwan, Singapore and Hong Kong as of March 31, 2013. All of the top 10 cinema chains in China, as measured by their respective number of cinema screens at the end of 2012, have installed our digital cinema servers. We have installed digital cinema servers for 7,927 screens in China as of March 31, 2013. We have installed 8,377 digital cinema servers in the United States as of March 31, 2013. In 2012, we shipped 300 integrated projection systems to the second largest cinema chain in India, as measured by its total number of cinema screens at the end of 2012. We have entered into a contract to ship 1,750 digital cinema servers to the second largest cinema chain in Mexico, as measured by its total number of cinema screens at the end of 2012, and have shipped over 400 units as of March 31, 2013. We believe our substantial installed base provides us with strong market recognition and significant long-term revenue opportunities from repeat purchases by both exhibitors and resellers. We are one of the few manufacturers in the world with digital cinema servers that are compliant with the specifications of Digital Cinema Initiatives, LLC, or DCI, a body formed by Hollywood studios to establish digital cinema industry standards. Our digital cinema servers allow exhibitors to exhibit digital cinema content securely in a wide range of formats, including 3D, high frame rate playback and live broadcasting. Our proprietary theatre management system, or TMS, enables exhibitors to effectively and remotely manage multiple screens and streamline theatre operations. We also resell a comprehensive suite of digital cinema products that includes integrated projection systems, 3D systems, projector lamps and silver screens. We maintain a broad service network that provides prompt and reliable services 24/7 to exhibitors, with offices in Hong Kong, the United States, China, Japan, Singapore, Spain, India and Mexico. We have developed a number of proprietary technologies that improve the audiovisual experience, security, delivery and exhibition of digital cinema content. In 2011, we were the first company to showcase a standalone integrated media block, which we believe will eliminate the need for the projection booths found in many exhibition halls today and, as a result, reduce equipment footprint and personnel costs. We were honored as Hong Kong's "Most Innovative Company of 2012" by Mediazone Publishing, a media consulting firm based in Hong Kong, which presented the annual award to select winners for, among other criteria, innovation in products or services and industry accolades. In 2013, we entered into a content distribution agreement with China Film Digital Film Development (Beijing) Limited and have begun offering cinema-grade digital cinema content to private venues, providing high-net-worth individuals in China with the ability to watch the latest Amendment No. 3 FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 CONVENTIONS THAT APPLY TO THIS PROSPECTUS Unless otherwise indicated, references in this prospectus to: "GDC Technology Limited," the "Company," "we," "us," "our," "our company" and "our business" are to GDC Technology Limited (Cayman), together with its subsidiaries as a consolidated entity; "GDC Technology Limited (BVI)" are to GDC Technology Limited, a company incorporated in the British Virgin Islands; "GDC Technology Limited (Cayman)" are to GDC Technology Limited, a company incorporated in the Cayman Islands, which became the ultimate holding company of our business after the Reorganization Transactions; "ADSs" are to our American depositary shares, each of which represents 15 ordinary shares, par value US$0.0001 per share; "Central and South America" are to the countries in the Americas excluding the United States and Canada; "China" and the "PRC" are to the People's Republic of China, excluding, for the purposes of this prospectus only, Taiwan and the special administrative regions of Hong Kong and Macau; "HK$" and "H.K. dollar" are to the legal currency of the special administrative region of Hong Kong; "Hollywood studios" are to the major motion picture studios in the United States, including Twentieth Century Fox Film Corporation, Paramount Pictures Corporation, Sony Pictures Entertainment Inc., Universal Studios, Inc., The Walt Disney Company and Warner Bros. Entertainment Inc. and their respective subsidiaries and affiliates; "incremental installed base" are to the net increase in installed base over a period of time; "installed base" are to the equipment installed in a region at a certain point in time; "ordinary shares" are to our ordinary shares, par value US$0.0001 per share; "North America" are to the United States and Canada; "RMB" and "Renminbi" are to the legal currency of China; "$", "US$" and "U.S. dollar" are to the legal currency of the United States of America; and "VPF" arrangement are to the "virtual print fee" arrangement, which is an arrangement where studios or distributors subsidize the purchase costs of digital cinema equipment by paying exhibitors fees for showing digital cinema content from such studios or distributors using such digital cinema equipment. Unless otherwise indicated, information in this prospectus assumes that the underwriters do not exercise their option to purchase additional ADSs. We report under International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board, or the IASB. None of the financial statements were prepared in accordance with generally accepted accounting principles in the United States. We have historically conducted our business through GDC Technology Limited (BVI) and its subsidiaries. Therefore, our historical financial statements present the results of operations of GDC Technology Limited (BVI). In May 2013, we underwent the Reorganization Transactions described in "Prospectus Summary The Reorganization Transactions" pursuant to which GDC Technology Limited Table of Contents theatrical releases in the privacy of their own homes. We also recently entered into contracts for licensing and reselling China Film Giant Screen systems in Asia (excluding China) on an exclusive basis and in the rest of the world on a non-exclusive basis. We have experienced significant growth in recent years. Our market share of incremental digital cinema server installations grew from 16% in 2010 to 35% in the first quarter of 2013. Our revenue grew from US$72.7 million in 2010 to US$90.0 million in 2011 and US$116.6 million in 2012. Our revenue for the three months ended March 31, 2013 amounted to US$32.4 million, representing an increase of 37.5% from the same period in 2012. Our profit for the year grew from US$19.9 million in 2010 to US$22.7 million in 2011 and US$27.7 million in 2012. Our profit for the three months ended March 31, 2013 amounted to US$5.3 million, representing an increase of 10.7% from the same period in 2012, after reflecting listing expenses of US$0.4 million. Our Industry The global cinema industry as measured by box office revenues grew from US$29.4 billion in 2009 to an estimated US$34.4 billion in 2012 and is forecasted to grow at a three-year compound annual growth rate, or CAGR, of 6.4% to US$41.4 billion by 2015. The number of cinema screens grew by a CAGR of 3.1% from 118,491 at the end of 2009 to 129,766 at the end of 2012. Over the same period, the number of cinema screens expected to be equipped with DCI-compliant or other equipment capable of exhibiting digital cinema content, or digital cinema screens, grew by a CAGR of 76.3% from 16,375 to 89,744. The first digital projector was commercially tested in June 1999 when Texas Instruments publicly demonstrated its DLP Cinema projector technology, the digital light processing technology widely used today in projectors for cinemas. By the end of 2013, over 80% of the world's cinema screens are expected to be digital cinema screens. The key drivers of analog-to-digital cinema screen conversion have been distribution cost savings, equipment incentive programs and growing consumer demand for new types of content that can only be shown using digital cinema technology. The key sources of demand for digital cinema equipment are expected to come from: (i) the analog-to-digital cinema screen conversion; (ii) new digital cinema screen installations as a result of new cinema construction; (iii) upgrades and replacements for digital cinema products, driven by new technology requirements and product replacement cycles; and (iv) installations of digital cinema solutions in private venues. Our Strengths We believe the following competitive strengths enable us to successfully compete in the growing digital cinema market: Strong global market leadership We believe our proven track record of delivering comprehensive, high-quality and innovative solutions has and will continue to help us expand our market share. For instance, our market share of incremental digital cinema servers installations in the United States increased from less than 1% in 2009 to approximately 34% in the first quarter of 2013. We were also the market leader in incremental digital cinema servers installations globally (35%), as well as in the Asia-Pacific region (54%) and China (66%) in the first quarter of 2013. We had the largest installed base of digital cinema servers in the Asia-Pacific region (44%) and the second largest installed base globally (23%) as of March 31, 2013. We also had the largest installed base in a number of territories, including China (56%), Japan (36%), South Korea (51%), Taiwan (52%), Singapore (84%) and Hong Kong (79%) as of Table of Contents GDC TECHNOLOGY LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) (In U.S. Dollar, except share and per share data, unless otherwise stated) 31. SHARE-BASED PAYMENT TRANSACTIONS (Continued) Number of share options Category of grantees Date of grant Exercise period Exercise price per share Balance as of 1.1.2011 Exercised during the year Cancelled/forfeited during the year Balance as of 31.12.2011 Directors 2.11.2007 2.11.2007 1.11.2012 HK$ 2.00 3,300,000 (3,300,000 ) 14.12.2010 14.12.2010 13.12.2015 HK$ 2.00 3,100,000 (3,100,000 ) Employees 14.12.2010 14.12.2010 13.12.2015 HK$ 2.00 2,600,000 (2,066,000 ) (95,000 )a 439,000 Other participants 2.11.2007 2.11.2007 1.11.2012 HK$ 2.00 330,000 (330,000 ) 14.12.2010 14.12.2010 13.12.2015 HK$ 2.00 6,300,000 (4,300,000 ) (2,000,000 )b Totals 15,630,000 (13,096,000 ) (2,095,000 ) 439,000 Exercisable at the end of the year 439,000 Weighted average exercise price HK$ 2 HK$ 2 HK$ 2 HK$ 2 Number of share options Category of grantees Date of grant Exercise period Exercise price per share Balance as of 1.1.2012 Exercised during the period Forfeited during the year Balance as of 31.12.2012 Employees 14.12.2010 14.12.2010 13.12.2015 HK$ 2.00 439,000 (14,000 )a 425,000 Totals 439,000 (14,000 ) 425,000 Exercisable at the end of the period 425,000 Weighted average exercise price HK$ 2 HK$ 2 HK$ 2 HK$ GDC TECHNOLOGY LIMITED NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (In U.S. Dollar, except share and per share data, unless otherwise stated) 20. SHARE-BASED PAYMENT TRANSACTIONS (Continued) Number of share options Category of grantees Date of grant Exercise period Exercise price per share Balance as of 1.1.2013 Forfeited during the period Balance as of 31.3.2013 Employees 14.12.2010 14.12.2010 13.12.2015 HK$ 2.00 425,000 425,000 Totals 425,000 425,000 Exercisable at the end of the period 425,000 Weighted average exercise price HK$ 2 HK$ 2 HK$ GDC Technology Limited (Exact name of registrant as specified in its charter) Not Applicable (Translation of registrant's name into English) Cayman Islands (State or other jurisdiction of incorporation or organization) 3663 (Primary Standard Industrial Classification Code Number) Not Applicable (I.R.S. Employer Identification Number) Unit 1-7, 20/F, Kodak House II 39 Healthy Street East, North Point Hong Kong +852.2523.6851 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) (BVI) became a wholly owned subsidiary of GDC Technology Limited (Cayman), a newly formed holding company. Beginning in the second quarter of 2013, our financial statements will present the results of operations of GDC Technology Limited (Cayman) and its consolidated subsidiaries. This prospectus contains statistical data that we obtained from various government and private publications. We have not independently verified the data in these reports. Statistical data in these publications also include projections based on a number of assumptions. If any one or more of the assumptions underlying the statistical data turns out to be incorrect, actual results may differ from the projections based on these assumptions. Unless context otherwise requires, market data regarding the digital cinema industry, including data concerning our installed base, represents management's estimates based on third-party sources. We calculated our incremental installed base, the net increase in our installed base over a period of time, by subtracting our installed base as of the beginning of a period from our installed base as of the end of the period. We calculated our market share of incremental digital cinema server installations in a region for a period by dividing our incremental installed base in the region for the period by the total incremental installed base in the region for the period. This prospectus contains conversions of H.K. dollar amounts into U.S. dollars solely for the convenience of the reader. Unless otherwise noted, all conversions from H.K. dollars to U.S. dollars and from U.S. dollars to H.K. dollars in this prospectus were made at a rate of HK$7.80 to US$1.00. The noon buying rate certified for customs purposes by the Federal Reserve Bank of New York in effect as of March 29, 2013 was HK$7.7629 to US$1.00. On June 14, 2013, the noon buying rate was HK$7.7612 to US$1.00. Any discrepancies in any table between totals and sums of amounts listed therein are due to rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures preceding them. Table of Contents March 31, 2013. We believe our large market share provides us with significant long-term revenue opportunities from repeat purchases by both exhibitors and resellers. Proven track record of technology leadership and innovation Since our inception in 1999, we have been at the forefront of technological advancements for the digital cinema industry. We have worked closely with Hollywood studios and international industry standards-setting bodies such as the Society of Motion Picture and Television Engineers to help define digital cinema industry standards. We have developed a number of proprietary technologies that have improved the audiovisual experience, security, delivery and exhibition of digital cinema content. We are one of a few manufacturers in the world to achieve DCI compliance for all of our digital cinema server models. Comprehensive portfolio of digital cinema solutions We offer a one-stop solution for exhibiting digital cinema content, including: digital cinema servers; integrated projection systems, 3D systems, projector lamps and silver screens from our partners; TMS and network operations center, or NOC, which offer exhibitors a centralized point of control to automate and streamline their cinema operations; and support services globally 24/7 through a NOC and 27 support centers. Close collaboration with industry leaders providing insights and opportunities We collaborate closely with digital cinema industry leaders, including standards-setting bodies, production companies, distributors, digital cinema equipment manufacturers and exhibitors, to anticipate and capitalize on changing technology requirements. Together, we jointly develop and market our solutions to capture additional revenue opportunities and satisfy our customers' needs for a one-stop solution, including 3D products, projector lamps and silver screens. We work with China Film Digital Film Development (Beijing) Limited to offer cinema-grade digital cinema content to private venues. We recently entered into contracts for licensing and reselling China Film Giant Screen systems in Asia (excluding China) on an exclusive basis and in the rest of the world on a non-exclusive basis. Our collaboration with reseller partners in the United States, Korea and Japan expands our customer base and geographic reach. Experienced management team with strong industry expertise We have an experienced management team focused on developing innovative technologies and solutions for the digital cinema industry. Dr. Man-Nang Chong, our chairman of the board of directors and chief executive officer, founded our company in Singapore in 1999, our chief technology officer, Mr. Pranay Kumar, has been with us since 2001 and our chief financial officer, Mr. Kent (Ming-Kin) Chiu, has been with us since 2006. They are experienced in managing our growing digital cinema business and have led us through a number of significant challenges. We believe that our experienced and dedicated management team, coupled with our proven track record and strong technological and execution capabilities, has contributed significantly to our past success and will continue to lead our future growth. Our Strategies We intend to capitalize on our global market leadership, technology capabilities, industry relationships and market reputation to continue developing and delivering innovative digital cinema solutions. Key elements of our strategies include: Increase global market share; Maintain and enhance technology leadership; Expand our digital cinema solutions offerings; Leverage existing technologies to expand into complementary markets; and Pursue strategic partnerships and acquisitions. GDC Technology (USA), LLC 1016 West Magnolia Boulevard Burbank, CA 91506 United States of America +1.818.972.4370 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents Our Challenges Our ability to successfully execute our strategies is subject to risks and uncertainties, including but not limited to those relating to the following: Industry demand for digital cinema products and services Our revenue and profitability depend on continuing demand for digital cinema equipment from (i) analog-to-digital cinema screen conversion, (ii) new digital cinema screen installations, (iii) upgrades and replacements for digital cinema products and (iv) installations of digital cinema solutions in private venues. We cannot assure you that any of these sources of demand will be sustained over time. We expect that the demand for digital cinema products from analog-to-digital conversion will decrease in most developed markets such as the United States, Europe and Japan, primarily as a result of the substantial completion of the industry transition from analog to digital cinema. Our ability to continue to develop and deliver innovative products and services Our success will depend on our ability to address the varied needs of existing and prospective customers by responding to rapid technological changes, evolving industry standards, such as support for high frame rate playback, as well as changes in consumer preferences and behavior, such as the increasing use of digital cinema technologies in private venues and online content streaming services. Our ability to comply with DCI specifications for our digital cinema equipment From time to time, DCI may release new recommendations and specifications which require technical improvements to both hardware and software. We cannot assure you that we will always be able to develop products that meet new DCI specifications in a timely or cost-effective manner or that all of the products that we manufacture, distribute and market as DCI-compliant products, including those supplied by third-party manufacturers, will always comply with DCI specifications. We may incur significant costs to develop and manufacture DCI-compliant products. If we or our suppliers, partners or customers use technology that does not comply with DCI specifications, there may be no viable market for our products and services. Competition within existing and new markets for digital cinema products and services The markets for our digital cinema products and services are highly competitive. Our reseller and digital projector partners may also be our current or potential competitors. Our competitors may be able to offer digital cinema products and services at more competitive prices than us. Exhibitors may perceive our competitors' products and services to be superior to ours. In addition, we may not be able to provide exhibitors the level and scope of localized after-sales services and support that our competitors provide in certain markets. Decreases in cinema attendance worldwide Cinema admissions worldwide may decrease, as home theatre and other private venues attract viewership away from cinemas. An increase in the popularity of alternative film distribution channels and competing forms of entertainment could drive down cinema attendance further and potentially cause exhibitors to close their theatres. Large scale theatre closures could significantly reduce demand from analog-to-digital cinema screen conversion, new installations, extend the product replacement cycle and discourage exhibitors from making additional investments on upgrades. Our ability to manage our business expansion and growth, including geographical expansion and expansion of our product and service offerings We have business expansion plans to increase our global market share and to expand our product and service offerings. We aim to increase our market share in key emerging markets, such as China, India, Central and South America and South East Asia. We also aim to increase our market share in key developed markets, such as North America and Western Europe, by capturing demand from upgrades and replacements. We plan to open new post-production facilities across Asia. We Copies to: Matthew Bersani Shuang Zhao Shearman & Sterling LLP c/o 12th Floor, Gloucester Tower, The Landmark 15 Queen's Road Central Hong Kong +852.2978.8000 Z. Julie Gao Skadden, Arps, Slate, Meagher & Flom LLP c/o 42nd Floor, Edinburgh Tower, The Landmark 15 Queen's Road Central Hong Kong +852.3740.4700 Table of Contents also intend to pursue VPF agreements for markets with significant analog-to-digital cinema screen conversion demand, such as Central and South America. We cannot assure you that any of these plans will be successful. Moreover, this business expansion could place significant additional demands on our operational and financial resources. Seasonality in our business We have historically experienced higher sales in the fourth quarter of a year, compared to the other three quarters of the same year, as our customers tend to purchase digital cinema equipment immediately before the winter holiday season, which is typically the peak season for box office revenues. We have historically experienced the lowest sales in the first quarter of a year for similar reasons. The timing of movie releases can have a significant effect on our results of operations. The results of one quarter are not necessarily indicative of results for the next quarter or any other quarter. Our customer concentration We depend upon a few major customers for a significant portion of our revenue. Our top five customers collectively accounted for 31.9%, 33.3%, 41.4% and 54.0% of our revenue for 2010, 2011, 2012 and the three months ended March 31, 2013, respectively. Our top customer in 2010, 2011 and 2012 was our largest reseller partner in the United States. It accounted for 12.3%, 11.8% and 14.4% of our revenue for 2010, 2011 and 2012, respectively. Our top customer for the three months ended March 31, 2013 was an exhibitor in the Asia-Pacific region. It accounted for 19.7% of our revenue for the period. A decision by any of our major customers not to purchase our products, or any failure to pay amounts owed to us could materially and adversely affect our business. In particular, we rely significantly on reseller partners, some of whom are our major customers, to market and distribute our digital cinema servers in certain regions. The loss of a major reseller partner or the inability or unwillingness of our reseller partners to dedicate the resources necessary to promote our portfolio of products could materially and adversely affect our revenue. Our relationships with exhibitors and studios Our relationships with exhibitors and studios are critical to our business. For example, our business expansion strategies, including signing additional VPF agreements and providing post-production services, may depend on our relationships with the studios and exhibitors in any given geographic market. Our relationships with suppliers We rely on third-party manufacturers for key components of our products as well as the digital projectors we use in our integrated projection systems and other digital cinema products that we resell, such as 3D products, projector lamps and silver screens. We do not have formal agreements in place with all of our suppliers for the continued supply of components and we may have no recourse or remedies in the event our suppliers fail to meet our requirements. Our reliance on sole-source suppliers for some of our key components We rely on sole-source suppliers for some of the key components that we use in our products, such as media decoders and processors used in our digital cinema servers, and for some of the products that we resell, such as 3D products. Our inability to obtain timely delivery of key components of acceptable quality and quantity, any significant increases in the prices of components or the redesign of our products could result in material production delays, increased costs and reductions in shipments of our products, any of which could increase our operating costs or harm our customer relationships. See
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+Prospectus Summary 1
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+Summary Financial Information 
+
+The following financial information summarizes the more complete historical financial information at the end of this prospectus.
+
+ 
+
+As of January 31, 2013 (Audited)
+
+Balance Sheet 
+
+ 
+ 
+ 
+
+Total Assets 
+
+ 
+
+$
+
+ 31,560
+
+Total Liabilities 
+
+ 
+
+$
+
+ 552 
+
+Stockholders Equity 
+
+ 
+
+$
+
+ 31,008
+
+ 
+
+ Period from February 9, 2012 (date of inception) to January 31, 2013(Audited) 
+
+Income Statement 
+
+ 
+ 
+ 
+
+Revenue 
+
+ 
+
+$
+
+2,475
+
+Total Expenses 
+
+ 
+
+$
+
+ 715
+
+Corporate Income Taxes 
+
+ 
+$
+
+352
+
+Net income from operations
+
+ 
+
+$
+
+1,404
+
+ 
+
+As of April 30, 2013 (Unaudited)
+
+Balance Sheet 
+
+ 
+ 
+ 
+
+Total Assets 
+
+ 
+
+$
+
+ 24,047
+
+Total Liabilities 
+
+ 
+
+$
+
+ 288 
+
+Stockholders Equity 
+
+ 
+
+$
+
+ 23,759
+
+ 
+
+ Period from February 9, 2012 (date of inception) to April 30, 2013(Unaudited) 
+
+Income Statement 
+
+ 
+ 
+ 
+
+Revenue 
+
+ 
+
+$
+
+2,475
+
+Total Expenses 
+
+ 
+
+$
+
+ 8,228
+
+Net loss from operations
+
+ 
+
+$
+
+5,841
+
+Risk Factors related to our Business and Industry
+
+AN INVESTMENT IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW AND THE OTHER INFORMATION IN THIS PROSPECTUS BEFORE INVESTING IN OUR COMMON STOCK. IF ANY OF THE FOLLOWING RISKS OCCUR, OUR BUSINESS, OPERATING RESULTS AND FINANCIAL CONDITION COULD BE SERIOUSLY HARMED. WE DO NOT CURRENTLY HAVE A TRADING PRICE FOR OUR COMMON STOCK. IF AND WHEN OUR COMMON STOCK BECOME ELIGIBLE FOR TRADING ON THE OVER-THE-COUNTER BULLETIN BOARD, THE TRADING PRICE OF OUR COMMON STOCK COULD DECLINE DUE TO ANY OF THESE RISKS, AND YOU MAY LOSE ALL OR PART OF YOUR INVESTMENT. THERE IS NO ASSURANCE OUR COMMON STOCK WILL BE ELIGIBLE FOR TRADING ON THE OTCBB.
+
+BECAUSE OUR AUDITORS HAVE RAISED A GOING CONCERN, THERE IS A SUBSTANTIAL UNCERTAINTY THAT WE WILL CONTINUE OPERATIONS IN WHICH CASE YOU COULD LOSE YOUR INVESTMENT.
+
+Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment.
+
+IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUR BUSINESS WILL FAIL.
+
+While on April 30, 2013, we had cash on hand of $24,047 we had operating expenses of $8,228 in business development and administrative expenses. Our current cash reserves are not sufficient to meet our obligations for the next twelve-month period. We anticipate that the minimum additional capital necessary to fund our planned operations for the 12-month period will be approximately $5,000 and will be needed for general administrative expenses, business development, marketing costs, support materials and costs associated with being a publicly reporting company. In order to expand our business operations, we anticipate that we will have to raise additional funding. There is no assurance that we will be able to raise additional funding. If we are not able to raise the capital necessary to fund our business expansion objectives, we may have to delay the implementation of our business plan.
+
+6 | Page
+
+We do not currently have any arrangements for financing. Obtaining additional funding will be subject to a number of factors, including general market conditions, investor acceptance of our business plan and initial results from our business operations. These factors may impact the timing, amount, terms or conditions of additional financing available to us. Management s time that may be spent trying to secure additional financing will take away time that management could spend on our operations.
+
+We are not raising any money in this offering. The most likely source of future funds available to us is through the sale of additional shares of common stock or advances from our sole officer and director. Any additional funding we arrange through the sale of our common stock will result in dilution to existing shareholders. Irina Petrzhikovskaya, our sole officer and director, has agreed to loan the Company funds to meet our obligations and complete our 12-months business plan. However, Ms. Petrzhikovskaya has no firm commitment, arrangement or legal obligation to advance or loan funds to the Company. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
+
+WE LACK AN OPERATING HISTORY AND THERE IS NO ASSURANCE OUR FUTURE OPERATIONS WILL RESULT IN REVENUES OR PROFITABILITY. IF WE CANNOT GENERATE SUFFICIENT REVENUES TO OPERATE PROFITABLY, WE MAY SUSPEND OR CEASE OPERATIONS.
+
+We were incorporated on February 9, 2012, and our net income since inception to January 31, 2013 is $1,404. We have very little operating history upon which an evaluation of our future success or failure can be made. Based upon current plans, we expect to incur operating losses in the foreseeable future because we will be incurring large expenses associated with SEC filings, establishing office, website development and marketing campaign without generating revenues. Failure to generate significant revenues in the future will cause us to go out of business.
+
+COMPETITORS WITH MORE RESOURCES MAY FORCE US OUT OF BUSINESS.
+
+Many competitors with similar products are significantly larger and have substantially greater financial, marketing and other resources and have achieved public recognition for their services. Competition by existing and future competitors could result in an inability to secure adequate consumer relationships sufficient enough to support Company endeavors. We cannot be assured that we will be able to compete successfully against present or future competitors or that the competitive pressure we may face will not force us to cease our operations.
+
+PRICE COMPETITION COULD NEGATIVELY AFFECT OUR GROSS MARGINS.
+
+Price competition could negatively affect our operating results. To respond to competitive pricing pressures, we will have to sell our products at lower prices in order to retain or gain market share and customers. If our competitors offer discounts on certain products in the future, we will need to lower prices to match the competition, which could adversely affect our gross margins and operating results. All of our larger competitors have significantly greater resources than we have and are better able to absorb losses. Our market is new and our business model is unproven, which makes it difficult to evaluate our current business and future prospects. Because this market is new, it is difficult to predict the future growth rate and size of this market. The factors that are beyond our control reduce our ability to accurately evaluate our future prospects and forecast quarterly or annual performance. We expect that our visibility into future sales of our products, including both sales volumes and prices, will continue to be limited for the foreseeable future.
+
+AS OF TODAY WE HAVE EXECUTED AGREEMENT WITH ONE CUSTOMER ONLY. IF THAT MAJOR CUSTOMER DECREASED OR TERMINATED ITS RELATIONSHIP WITH US OUR BUSINESS WOULD LIKELY FAIL IF WE ARE UNABLE TO FIND NEW CUSTOMERS FOR OUR PRODUCT.
+
+As a result of being totally dependent on a single customer, we may be subject to certain risks. As of today, we have executed only one agreement with customer, Aldent, LLC. Our agreement with this company does not prevent it from buying similar products from our competitors or directly from no-line stores. If this company decreased, modified or terminated its association with us for any other reason, we would suffer an interruption in our business unless and until we found new customers. If we were unable to find a substitute for that customer, our business would likely fail. We cannot predict what the likelihood would be of finding an acceptable substitute customer.
+
+7 | Page
+
+IF WE FAIL TO SUCCESSFULLY MANAGE OUR RELASHIONSHIPS WITH RESELLERS OUR BUSINESS WOULD BE HARMED.
+
+We may lose sales opportunities if we do not successfully develop and maintain strategic relationships with resellers of our products. Our relationships with all of our resellers will be new, and we are unable to predict the extent to which resellers will be successful in marketing and selling our products. Also, these relationships may be terminated at any time. We need to maintain and expand our relationships with these companies, develop additional channels for the distribution and sale of our products and effectively manage these relationships. If we fail to do so, our resellers may decide not to include our products among those that they sell or they may not make marketing and selling our products a priority. In addition, our resellers may sell products that are competitive with ours. If we fail to successfully manage our relationships with our resellers, our ability to sell our teeth whitening strips into new markets and to increase our penetration into existing markets may be impaired and our business would be harmed.
+
+ 
+
+OUR BUSINESS CAN BE AFFECTED BY CURRENCY RATE FLUCTUATIONS AS OUR WHOLESALERS/RESELLERS ARE IN LATVIA AND WE PURCHASE OUR PRODUCT IN AMERICAN DOLLARS.
+
+We intend to sell our teeth whitening strips to distributors in Latvia whose operations are in Latvian lats, while we will purchase the product in American Dollars, so we are affected by changes in foreign exchange rates. If we are not able to successfully protect ourselves against currency fluctuations, our profits will also fluctuate and could cause us to be less profitable or incur losses, even if our business is doing well.
+
+BECAUSE OUR PRINCIPAL ASSETS ARE LOCATED OUTSIDE OF THE UNITED STATES AND IRINA PETRZHIKOVSKAYA, OUR SOLE DIRECTOR AND OFFICER, RESIDES OUTSIDE OF THE UNITED STATES, IT MAY BE DIFFICULT FOR AN INVESTOR TO ENFORCE ANY RIGHT BASED ON U.S. FEDERAL SECURITIES LAWS AGAINST US AND/OR MS. PETRZHIKOVSKAYA, OR TO ENFORCE A JUDGMENT RENDERED BY A UNITED STATES COURT AGAINST US OR MS. PETRZHIKOVSKAYA.
+
+ 
+
+Our principal operations and assets are located outside of the United States, and Irina Petrzhikovskaya, our sole officer and director, is a non-resident of the United States. Therefore, it may be difficult to effect service of process on Ms. Petrzhikovskaya in the United States, and it may be difficult to enforce any judgment rendered against Ms. Petrzhikovskaya. As a result, it may be difficult or impossible for an investor to bring an action against Ms. Petrzhikovskaya, in the event that an investor believes that such investor s rights have been infringed under the U.S. securities laws, or otherwise. Even if an investor is successful in bringing an action of this kind, the laws of Republic of Latvia may render that investor unable to enforce a judgment against the assets of Ms. Petrzhikovskaya. As a result, our shareholders may have more difficulty in protecting their interests through actions against our management, director or major shareholder, compared to shareholders of a corporation doing business and whose officers and directors reside within the United States.
+
+Additionally, because of our assets are located outside of the United States, they will be outside of the jurisdiction of United States courts to administer, if we become subject of an insolvency or bankruptcy proceeding. As a result, if we declare bankruptcy or insolvency, our shareholders may not receive the distributions on liquidation that they would otherwise be entitled to if our assets were to be located within the United States under United States bankruptcy laws.
+
+8 | Page
+
+OUR SOLE OFFICER AND DIRECTOR HAS LACK OF EXPERIENCE MANAGING PUBLIC REPORTING COMPANY AND ACCOUNTING WHICH IS REQUIRED TO ESTABLISH AND MAINTAIN DISCLOSURE CONTROL AND PROCEDURES AND INTERNAL CONTROL OVER FINANCIAL REPORTING.
+
+We have never operated as a public company. Irina Petrzhikovskaya, our sole officer and director has no experience managing a public company that is required to establish and maintain disclosure controls and procedures and internal control over financial reporting. Also, Ms. Irina Petrzhikovskaya has only limited experience in accounting. As our operations become more complex we will be required to hire additional accounting personal to comply with our reporting obligations. If we cannot operate successfully as a public company, your investment may be materially adversely affected.
+
+BECAUSE OUR SOLE OFFICER AND DIRECTOR OWNS 71.77% OF OUR ISSUED AND OUTSTANDING COMMON STOCK, SHE WILL HAVE THE ABILITY TO MAKE AND CONTROL CORPORATE DECISIONS THAT MAY BE DISADVANTAGEOUS TO MINORITY SHAREHOLDERS.
+
+Our sole officer and director, Irina Petrzhikovskaya, owns approximately 71.77% of the outstanding shares of our common stock. Accordingly, she will have the ability to determine the outcome of all corporate transactions or other matters, including mergers, consolidations, and the sale of all or substantially all of our assets. She will also have the power to prevent or cause a change in control. The interests of our sole officer and director may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other shareholders.
+
+BECAUSE OUR SOLE OFFICER AND DIRECTOR HAS OTHER BUSINESS INTERESTS, SHE MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL. 
+
+Our sole officer and director, Ms. Irina Petrzhikovskaya, will only be devoting limited time to our operations. Ms. Petrzhikovskaya intends to devote approximately 20 hours a week of her business time to our affairs. Because our sole officer and director will only be devoting limited time to our operations, our operations may be sporadic and occur at times which are convenient to her. As a result, our operations may be periodically interrupted or suspended which could result in a lack of revenues and a possible cessation of operations. It is possible that the demands on Ms. Petrzhikovskaya from her other obligations could increase with the result that she would no longer be able to devote sufficient time to the management of our business. In addition, Ms. Petrzhikovskaya may not possess sufficient time for our business if the demands of managing our business increase substantially beyond current levels.
+
+IF MS. PETRZHIKOVSKAYA, OUR SOLE OFFICER AND DIRECTOR, SHOULD RESIGN OR DIE, WE WILL NOT HAVE AN OFFICER OR A DIRECTOR. THIS COULD RESULT IN OUR OPERATIONS SUSPENDING, AND YOU COULD LOSE YOUR INVESTMENT.
+
+We extremely depend on the services of our sole officer and director, Ms. Petrzhikovskaya, for the future success of our business. The loss of the services of Ms. Petrzhikovskaya could have an adverse effect on our business, financial condition and results of operations. If she should resign or die we will not have a chief executive officer. If that should occur, until we find another person to act as our chief executive officer, our operations could be suspended. In that event it is possible you could lose your entire investment.
+
+9 | Page
+
+AS AN EMERGING GROWTH COMPANY UNDER THE JOBS ACT, WE ARE PERMITTED TO RELY ON EXEMPTIONS FROM CERTAIN DISCLOSURE REQUIREMENTS. 
+
+We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to: 
+
+-
+
+have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; 
+
+-
+
+provide an auditor attestation with respect to management s report on the effectiveness of our internal controls over financial reporting;
+
+-
+
+comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); 
+
+-
+
+submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and 
+
+-
+
+ disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive s compensation to median employee compensation. 
+
+ 
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
+
+We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. Even if we no longer qualify for the exemptions for an emerging growth company, we may still be, in certain circumstances, subject to scaled disclosure requirements as a smaller reporting company. For example, smaller reporting companies, like emerging growth companies, are not required to provide a compensation discussion and analysis under Item 402(b) of Regulation S-K or auditor attestation of internal controls over financial reporting. 
+
+Until such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
+
+10 | Page
+
+ANY ADDITIONAL FUNDING WE ARRANGE THROUGH THE SALE OF OUR COMMON STOCK WILL RESULT IN DILUTION TO EXISTING SHAREHOLDERS.
+
+We must raise additional capital in order for our business plan to succeed. We are not raising any money in this offering. Our most likely source of additional capital will be through the sale of additional shares of common stock. Such stock issuances will cause stockholders' interests in our company to be diluted. Such dilution will negatively affect the value of investors shares.
+
+OUR SHARES OF COMMON STOCK ARE SUBJECT TO THE PENNY STOCK RULES OF THE SECURITIES AND EXCHANGE COMMISSION AND THE TRADING MARKET IN OUR SECURITIES WILL BE LIMITED, WHICH WILL MAKE TRANSACTIONS IN OUR STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR STOCK.
+
+The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules. If a trading market for our common stock develops, our common stock will probably become subject to the penny stock rules, and shareholders may have difficulty in selling their shares.
+
+IF OUR SHARES OF COMMON STOCK COMMENCE TRADING ON THE OTC BULLETIN BOARD, THE TRADING PRICE MAY FLUCTUATE SIGNIFICANTLY AND STOCKHOLDERS MAY HAVE DIFFICULTY RESELLING THEIR SHARES.
+
+As of the date of this Registration Statement, our common stock does not yet trade on the Over-the-Counter Bulletin Board. If our shares of common stock commence trading on the Bulletin Board, there is a volatility associated with Bulletin Board securities in general and the value of your investment could decline due to the impact of any of the following factors upon the market price of our common stock: (i) disappointing results from our development efforts; (ii) failure to meet our revenue or profit goals or operating budget; (iii) decline in demand for our common stock; (iv) downward revisions in securities analysts' estimates or changes in general market conditions; (v) technological innovations by competitors or in competing technologies; (vi) lack of funding generated for operations; (vii) investor perception of our industry or our prospects; and (viii) general economic trends.
+
+11 | Page
+
+We do not have a market maker. There is no current trading market for our securities and if a trading market does not develop, purchasers of our securities may have difficulty selling their shares. In addition, stock markets have experienced price and volume fluctuations and the market prices of securities have been highly volatile. These fluctuations are often unrelated to operating performance and may adversely affect the market price of our common stock. As a result, investors may be unable to sell their shares at a fair price and you may lose all or part of your investment.
+
+THERE IS NO CURRENT TRADING MARKET FOR OUR SECURITIES AND IF A TRADING MARKET DOES NOT DEVELOP, PURCHASERS OF OUR SECURITIES MAY HAVE DIFFICULTY SELLING THEIR SHARES.
+
+There is currently no established public trading market for our securities and an active trading market in our securities may not develop or, if developed, may not be sustained. We intend to have a market maker apply for admission to quotation of our securities on the Over-the-Counter Bulletin Board after the Registration Statement relating to this prospectus is declared effective by the SEC. We do not yet have a market maker who has agreed to file such application. If for any reason our common stock is not quoted on the Over-the-Counter Bulletin Board or a public trading market does not otherwise develop, purchasers of the share may have difficulty selling their common stock should they desire to do so. No market makers have committed to becoming market makers for our common stock and none may do so.
+
+WE MAY BE EXPOSED TO POTENTIAL RISKS AND SIGNIFICANT EXPENSES RESULTING FROM THE REQUIREMENTS UNDER SECTION 404 OF THE SARBANES-OXLEY ACT OF 2002.
+
+We will be required, pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, to include in our annual report our assessment of the effectiveness of our internal control over financial reporting. We expect to incur significant continuing costs, including accounting fees and staffing costs, in order to maintain compliance with the internal control requirements of the Sarbanes-Oxley Act of 2002. Development of our business will necessitate ongoing changes to our internal control systems, processes and information systems. If our business develops and grows, our current design for internal control over financial reporting will not be sufficient to enable management to determine that our internal controls are effective for any period, or on an ongoing basis. Accordingly, as we develop our business, such development and growth will necessitate changes to our internal control systems, processes and information systems, all of which will require additional costs and expenses.
+
+In the future, if we fail to complete the annual Section 404 evaluation in a timely manner, we could be subject to regulatory scrutiny and a loss of public confidence in our internal controls. In addition, any failure to implement required new or improved controls, or difficulties encountered in their implementation, could harm our operating results or cause us to fail to meet our reporting obligations. However, as an emerging growth company, as defined in the JOBS Act, our independent registered public accounting firm will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 until the later of the year following our first annual report required to be filed with the SEC, or the date we are no longer an emerging growth company. At such time, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our controls are documented, designed or operating.
+
+12 | Page
+
+THE COSTS TO MEET OUR REPORTING AND OTHER REQUIREMENTS AS A PUBLIC COMPANY SUBJECT TO THE EXCHANGE ACT OF 1934 ARE SUBSTANTIAL AND MAY RESULT IN US HAVING INSUFFICIENT FUNDS TO EXPAND OUR BUSINESS OR EVEN TO MEET ROUTINE BUSINESS OBLIGATIONS.
+
+As a public entity subject to the reporting requirements of the Exchange Act of 1934, we incur ongoing expenses associated with professional fees for accounting, legal and SEC filings and compliance. We estimate that these costs will increase if our business volume and activity increases. As a result of such expenses, we may not have sufficient funds to grow our operations.
+
+Forward-Looking Statements
+
+This prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in the Risk Factors section and elsewhere in this prospectus. 
+
+Use of Proceeds
+
+We will not receive any proceeds from the sale of the common stock offered through this prospectus by the selling shareholders. 
+
+Determination of Offering Price 
+
+The selling shareholders will sell our shares at $0.03 per share. We determined this offering price arbitrarily, by adding a $0.02 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering. 
+
+Dilution
+
+The common stock to be sold by the selling shareholders is common stock that is currently issued and outstanding. Accordingly, there will be no dilution to our existing shareholders. 
+
+Selling Shareholders 
+
+The selling shareholders named in this prospectus are offering all of the 2,360,000 shares of common stock offered through this prospectus. These shares were acquired from us in private placements that were exempt from registration under Regulation S promulgated pursuant to the Securities Act of 1933. All shares were acquired outside of the United States by non-U.S. persons. The shares include the following: 
+
+-
+
+2,360,000 shares of our common stock that the selling shareholders acquired from us in an offering that was completed on December 14, 2012.
+
+13 | Page
+
+The following table provides as of the date of this prospectus, information regarding the beneficial ownership of our common stock held by each of the selling shareholders, including: 
+
+1. the number of shares owned by each prior to this offering;
+
+2. the total number of shares that are to be offered for each;
+
+3. the total number of shares that will be owned by each upon completion of the offering; and
+
+4. the percentage owned by each upon completion of the offering.
+
+Name Of Selling Shareholder
+
+Shares Owned Prior To This Offering
+
+Total Number Of Shares To Be Offered For Selling Shareholders Account
+
+Total Shares to Be Owned Upon Completion Of This Offering
+
+Percentage of Shares owned Upon Completion of This Offering
+
+Ahmet Aladdin Tavrak
+
+75,000
+
+75,000
+
+Nil
+
+Nil
+
+Aleksandrs Makovskis
+
+120,000
+
+120,000
+
+Nil
+
+Nil
+
+Anton Lim
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Cunrong Chen
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Denis Ivanchenko
+
+80,000
+
+80,000
+
+Nil
+
+Nil
+
+Dmitry Duplishchev
+
+80,000
+
+80,000
+
+Nil
+
+Nil
+
+Fuat Bal
+
+65,000
+
+65,000
+
+Nil
+
+Nil
+
+Iveta Kokina
+
+120,000
+
+120,000
+
+Nil
+
+Nil
+
+Laila Ozola
+
+120,000
+
+120,000
+
+Nil
+
+Nil
+
+Leonids Beloglazovs
+
+120,000
+
+120,000
+
+Nil
+
+Nil
+
+MD Mazharul Alam
+
+80,000
+
+80,000
+
+Nil
+
+Nil
+
+Michael Nagel
+
+65,000
+
+65,000
+
+Nil
+
+Nil
+
+Milan Lackanovic
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Mingchun Shen
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Mohi Ahamed
+
+80,000
+
+80,000
+
+Nil
+
+Nil
+
+Nazmul Alam
+
+80,000
+
+80,000
+
+Nil
+
+Nil
+
+Olha Marholych
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Remi Martin Eikemo
+
+85,000
+
+85,000
+
+Nil
+
+Nil
+
+Roman Vert
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Rui Zhang 
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Sigita Berzina
+
+90,000
+
+90,000
+
+Nil
+
+Nil
+
+Silva Rudasa
+
+120,000
+
+120,000
+
+Nil
+
+Nil
+
+Syed Iftikharul Sakif
+
+80,000
+
+80,000
+
+Nil
+
+Nil
+
+Tatyana Kim
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+Yevgeniya Gorislavets
+
+100,000
+
+100,000
+
+Nil
+
+Nil
+
+14 | Page
+
+The named party beneficially owns and has sole voting and investment power over all shares or rights to these shares. The numbers in this table assume that none of the selling shareholders sells shares of common stock not being offered in this prospectus or purchases additional shares of common stock, and assumes that all shares offered are sold. The percentages are based on 2,360,000 shares of common stock issued and outstanding on the date of this prospectus. 
+
+Other than disclosed above, none of the selling shareholders: 
+
+1.
+
+has had a material relationship with us other than as a shareholder at any time within the past three years; 
+
+2.
+
+has ever been one of our officers or directors;
+
+3.
+
+is a broker-dealer; or a broker-dealer's affiliate.
+
+Plan of Distribution 
+
+The selling shareholders may sell some or all of their common stock in one or more transactions, including block transactions. There are no arrangements, agreements or understandings with respect to the sale of these securities. 
+
+The selling shareholders will sell our shares at $0.03 per share. We determined this offering price arbitrarily by adding a $0.02 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering. 
+
+The shares may also be sold in compliance with the Securities and Exchange Commission's Rule 144, when eligible.
+
+If applicable, the selling shareholders may distribute shares to one or more of their partners who are unaffiliated with us. Such partners may, in turn, distribute such shares as described above. If these shares being registered for resale are transferred from the named selling shareholders and the new shareholders wish to rely on the prospectus to resell these shares, then we must first file a prospectus supplement naming these individuals as selling shareholders and providing the information required concerning the identity of each selling shareholder and he or her relationship to us. There is no agreement or understanding between the selling shareholders and any partners with respect to the distribution of the shares being registered for resale pursuant to this registration statement. 
+
+We can provide no assurance that all or any of the common stock offered will be sold by the selling shareholders. 
+
+We are bearing all costs relating to the registration of the common stock. The selling shareholders, however, will pay any commissions or other fees payable to brokers or dealers in connection with any sale of the common stock. 
+
+The selling shareholders must comply with the requirements of the Securities Act of 1933 and the Securities Exchange Act of 1934 in the offer and sale of the common stock. The selling shareholders must comply with the enumerated conditions for the duration of the offering: 
+
+ 
+
+1.
+
+Not engage in any stabilization activities in connection with our common stock;
+
+ 
+
+ 
+ 
+
+ 
+
+2.
+
+Furnish each broker or dealer through which common stock may be offered, such copies of this prospectus, as amended from time to time, as may be required by such broker or dealer; and
+
+ 
+
+ 
+ 
+
+ 
+
+3.
+
+Not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities other than as permitted under the Securities Exchange Act.
+
+15 | Page
+
+The Securities and Exchange Commission (the Commission ) has also adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). 
+
+The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the Commission, which contains: 
+
+-
+
+a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;
+
+-
+
+a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements;
+
+-
+
+a brief, clear, narrative description of a dealer market, including "bid" and "ask" prices for penny stocks and the significance of the spread between the bid and ask price;
+
+-
+
+a toll-free telephone number for inquiries on disciplinary actions;
+
+-
+
+a definition of significant terms in the disclosure document or in the conduct of trading penny stocks; and
+
+-
+
+such other information and is in such form (including language, type, size, and format) as the Commission shall require by rule or regulation.
+
+The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with: 
+
+-
+
+bid and offer quotations for the penny stock;
+
+-
+
+the compensation of the broker-dealer and its salesperson in the transaction;
+
+-
+
+the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and
+
+-
+
+monthly account statements showing the market value of each penny stock held in the customer's account.
+
+In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement. These disclosure requirements will have the effect of reducing the trading activity in the secondary market for our stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficulty selling those securities. 
+
+16 | Page
+
+Description of Securities 
+
+General 
+
+Our authorized capital stock consists of 75,000,000 shares of common stock at a par value of $0.001 per share. 
+
+Common Stock 
+
+As of
+
+May 30
+
+, 2013 there were 8,360,000 shares of our common stock issued and outstanding held by 26 stockholders of record. 
+
+Holders of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of common stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of common stock voting for the election of directors can elect all of the directors. Holders of our common stock representing a majority of the voting power of our capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our articles of incorporation. 
+
+Holders of common stock are entitled to share in all dividends that the board of directors, in its discretion, declares from legally available funds. In the event of liquidation, dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock. Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock. 
+
+Preferred Stock
+
+We do not have an authorized class of preferred stock. 
+
+Dividend Policy 
+
+We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future. 
+
+Share Purchase Warrants 
+
+We have not issued and do not have any outstanding warrants to purchase shares of our common stock. 
+
+Options 
+
+We have not issued and do not have any outstanding options to purchase shares of our common stock. 
+
+Convertible Securities 
+
+We have not issued and do not have any outstanding securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock. 
+
+17 | Page
+
+Interests of Named Experts and Counsel 
+
+No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, an interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee. 
+
+Scott D. Olson, Esq. has provided an opinion on the validity of our common stock.
+
+The financial statements included in this prospectus and the registration statement have been audited by Ronald R. Chadwick, P.C. to the extent and for the periods set forth in their report appearing elsewhere in this document and in the registration statement filed with the SEC, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.
+
+Description of Business 
+
+Overview 
+
+We are a development stage company which plans to engage in the distribution of teeth whitening strips in Latvia. We were incorporated in the State of Nevada on February 9, 2012 and cannot state with certainty whether we will achieve profitability. To date, our business operations have been limited to primarily the development of a business plan, the completion of private placements for the offer and sale of our common stock and the signing of the sales distribution agreement with Aldent LLC, a privet Latvian company. As of today, gross profit of $2,475 was recognized from the sale transaction. 
+
+100% of your revenues to date are derived from our one customer.
+
+We have earned minimal revenues since inception and have minimal assets. Our plan of operation is forward-looking. It is likely that we will not be able to achieve profitability and might need to cease operations due to the lack of funding. Our business office is located at Darzinu 22 linija, 10 Majas, Riga, Latvia LV-1063. Our telephone number is (702) 605-0519.
+
+We intend to distribute teeth whitening strips in Latvia. Our current cash reserves are not sufficient to meet our obligations for the next twelve-month period. As a result, we will need to seek additional funding in the near future. The most likely source of this additional capital is through the sale of additional shares of common stock or advances from our sole officer and director. Irina Petrzhikovskaya, our sole officer and director, has agreed to loan the Company funds to meet our obligations and complete our 12-months business plan. However, Ms. Petrzhikovskaya has no firm commitment, arrangement or legal obligation to advance or loan funds to the Company. 
+
+Product Description
+
+A child's deciduous teeth are generally whiter than the adult teeth that follow. As a person ages the adult teeth often become darker due to changes in the mineral structure of the tooth, as theenamel becomes less porous and phosphate-deficient. Teeth can also become stained by bacterial pigments, food-goods and vegetables rich with carotenoids or xanthonoids. Certain antibacterial medications (like tetracycline) can also cause teeth stains or a reduction in the brilliance of the enamel. Ingesting colored liquids like coffee, tea and red wine can also discolor teeth. There are several whitening methods to restores natural teeth color. According to the American Dental Association, different whitening include: in-office bleaching, which is applied by a professional dentist; at-home bleaching, which is used at home by the patient; over-the-counter, which is applied by patients, over a counter; and options called non-dental, which are offered at mall kiosks, spas, salons etc. There is also the option of whitening one's own teeth by natural teeth bleaching methods and stain out swabs.
+
+18 | Page
+
+Whitening Strips are another popular over-the-counter method of at-home whitening of the teeth. The product is used by placing a disposable plastic strip directly onto the teeth that contains an enamel safe whitening gel. The strips are coated with whitening gel and are usually applied only to the tooth surfaces that are visible when smiling. Typically, the whitening strips are applied to the front surfaces of the front teeth. Some of the whitening strips have a higher concentration of whitening gel and as a result, quicker whitening results. These whitening gel coated strips should not be used on children under age 12. Exposure of the gel on the strips to the gingiva (gums) should be avoided since it can cause irritation to the tissue. Overall, the teeth whitening strips provide a quick, affordable and convenient method of whitening the most visible teeth. Teeth whitening strips are a great low-cost alternative to costly teeth whitening at the dentist. 
+
+We expect to be able to purchase our inventory from on-line stores. We will be purchasing our inventory from different online stores. As of today we have no agreements with any stores. We plan on selling different brands of whitening strips. We will take prepayments from our clients prior to purchasing and shipment. Potential customers will have two options to pay for the product: by wire transfer or by sending a check/money order. Our customers will be responsible to cover the shipping costs, custom duties, taxes or any other additional charges that might incur. 
+
+As of today, we executed Sales Distribution Agreement with Aldent LLC and filled Aldent's first orders for our products and sold to it our teeth whitening strips. As a result we realized our net income in the amount of $1,404.
+
+100% of your revenues to date are derived from our one customer.
+
+This income was achieved through our contractual relationship with Aldent. 
+
+Marketing Our Product
+
+We intend to enter into agreements with numerous local dental care product distributors, dental and cosmetic clinics and dentists who can order teeth whitening strips from us. As of today, we have signed a Sales Distribution Agreement with Aldent LLC, a private Latvian company. We have not identified any other potential counterparties to these agreements and we have not entered into any discussions with other distributors. 
+
+We intend to use marketing strategies, such as web advertisements, direct mailing, and phone calls to acquire potential customers. We plan to develop a website to market and display our products. As of the date of this prospectus we have not yet identified or registered any domain names for our website. To accomplish this, we plan to contract an independent web designing company. Our website will describe our product in detail, show our contact information, and include some general information and pictures of teeth whitening strips. We intend to attract traffic to our website by a variety of online marketing tactics such as registering with top search engines using selected key words and metatags, and utilizing link and banner exchange options. We intend to promote our website by displaying it on our promotion materials.
+
+To draw attention from potential customers and end users we plan to market and advertise our company though social networking. Websites such as Facebook and Twitter have come a long way in only a few years to be household names all over the world. We intend to use these websites to spread out information about our whitening strips. We intend to implement word of mouth advertising into our business model. We believe a huge marketing opportunity on the internet is spreading word of mouth, a form of free advertising.
+
+We also plan to attend trade shows in dental industry to showcase our product with a view to find new customers. We will intend to continue our marketing efforts during the life of our operations. We intend to spend at least $11,000 on marketing efforts during the first year. There is no guarantee that we will be able to attract and more importantly retain enough customers to justify our expenditures. If we are unable to generate a significant amount of revenue and to successfully protect ourselves against those risks, then it would materially affect our financial condition and our business could be harmed.
+
+19 | Page
+
+Competition
+
+The dental care products distribution industry is extremely fragmented and competitive. Competitors will include companies with substantial customer bases and working history. There can be no assurance that we can maintain a competitive position against current or future competitors, particularly those with greater financial, marketing, service, technical and other resources. Our failure to maintain a competitive position within the market could have a material adverse effect on our business, financial condition and results of operations. There can be no assurance that we will be able to compete successfully against current and future competitors, and competitive pressures faced by us may have a material adverse effect on our business, financial condition and results of operations. 
+
+Some of the competitive factors that may affect our business are as follows:
+
+1. Number of Competitors Increase: other companies may follow our business model of distributing lower priced teeth whitening products, which will reduce our competitive edge.
+
+2. Price: Our competitors may be selling similar product at a lower price forcing us to lower our prices as well and possibly sell our product at loss.
+
+3. Substitute Products: teeth whitening strips may be substituted by other whitening products. Consumer preferences for may change overtime which may affect our business positively or negatively depending on whether whitening strips is preferred more or less.
+
+We also expect the competition from the online stores where we will be purchasing our inventory as our potential customers can buy products directly from them. If this happens our business would likely fail.
+
+Sales Distribution Agreement
+
+On January 14, 2013 we signed a Sales Distribution Agreement with Aldent LLC, a private Latvian company. The agreement with Aldent LLC contains the following material terms:
+
+1.
+
+Alphala agrees to supply the Products and fill Aldent's written orders for Products in a timely manner, and in any event will use its best efforts to fill placed orders within a period of thirty (30) days or less following receipt of prepayment.
+
+2.
+
+Aldent shall prepay for Products under this Agreement by wire transfer or credit card prior to product shipment.
+
+3.
+
+The currency of this Agreement is American dollars.
+
+4.
+
+Alphala is entitled to make reasonable adjustment(s) to the price of the products.
+
+5.
+
+Aldent will pay shipping, unless other arrangements have been made.
+
+6.
+
+Termination of the Agreement may be commenced upon thirty (30) days written Notice. Termination will be effective sixty days (60) days following the date that Notice of termination is received by the non-terminating Party.
+
+7.
+
+The Agreement is non-exclusive; therefore, Alphala can distribute the Products to any third party who may then attempt to sell, market, or distribute the Products to the General Public.
+
+8.
+
+There are no set minimum quota requirements for sales under this Agreement. Alphala is obliged to assist in the completion of each sales order regardless of the quantity. Orders will be taken on a case by cases basis by Alphala.
+
+A copy of the Sales Distribution Agreement is filed as Exhibit 10.1 to this registration statement. 
+
+As of today, we depend on one major customer, Aldent, LLC. Our agreement with this company does not prevent it from buying similar products from our competitors or directly from no-line stores. If this company decreased, modified or terminated its association with us for any other reason, we would suffer an interruption in our business unless and until we found new customers. If we were unable to find a substitute for that customer, our business would likely fail. We cannot predict what the likelihood would be of finding an acceptable substitute customer.
+
+Description of property 
+
+We do not have an ownership or leasehold interest in any property. We have no plans to hold inventory of teeth whitening strips in the United States or in Latvia, and we have no plans to obtain the space necessary to hold such inventory. 
+
+20 | Page
+
+Insurance
+
+We do not maintain any insurance and do not intend to maintain insurance in the future. Because we do not have any insurance, if we are made a party of a products liability action, we may not have sufficient funds to defend the litigation. If that occurs a judgment could be rendered against us that could cause us to cease operations. 
+
+Employees. Identification of Certain Significant Employees
+
+We are a development stage company and currently have no employees, other than our sole officer and director Ms. Irina Petrzhikovskaya. We intend to hire additional employees on an as needed basis. 
+
+Research and Development Expenditures 
+
+We have not incurred any other research or development expenditures since our incorporation. 
+
+Government Regulation
+
+We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to export and import of products to European Union and to operation of any facility in any jurisdiction which we would conduct activities. We believe that government regulation will have no material impact on the way we conduct our business. We do not need to receive any government approvals necessary to conduct our business, however we will have to comply with all applicable export and import regulations.
+
+Subsidiaries 
+
+We do not have any subsidiaries.
+
+Patents and Trademarks 
+
+We do not own, either legally or beneficially, any patents or trademarks. 
+
+Offices
+
+Our office is currently located at Darzinu 22 linija, 10 Majas, Riga, Latvia LV-1063. Our telephone number is (702) 605-0519. This is the office of our Sole Officer and Director, Ms. Irina Petrzhikovskaya. We do not pay any rent to Ms. Petrzhikovskaya and there is no agreement to pay any rent in the future. As of the date of this prospectus, we have not sought or selected a new office location. We plan to establish an office in Latvia by the end of June, 2013.
+
+Legal Proceedings 
+
+We are not currently a party to any legal proceedings. Our address for service of process in Nevada is 2360 Corporate Circle, Ste. 400 Henderson, Nevada 89074-7722.
+
+21 | Page
+
+Market for Common Equity and Related Stockholder Matters
+
+No Public Market for Common Stock 
+
+There is presently no public market for our common stock. We anticipate applying for trading of our common stock on the over the counter bulletin board upon the effectiveness of the registration statement of which this prospectus forms a part. However, we can provide no assurance that our shares will be traded on the bulletin board or, if traded, that a public market will materialize.
+
+Stockholders of Our Common Shares
+
+As of the date of this registration statement we have 26 registered shareholders. 
+
+Rule 144 Shares 
+
+A total of 6,000,000 shares of our common stock are available for resale to the public in accordance with the volume and trading limitations of Rule 144. Pursuant to Rule 144, a person who has beneficially owned restricted shares of our common stock for at least six months is entitled to sell their securities provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three months preceding the sale and (ii) we are subject to the Securities Exchange Act of 1934 periodic reporting requirements for at least three months before the sale.
+
+Persons who have beneficially owned restricted shares of our common stock for at least six months but who are our affiliates at the time of, or at any time during the three months preceding the sale, are subject to additional restrictions. Such person is entitled to sell within any three-month period only a number of securities that does not exceed the greater of either of the following:
+
+ 
+
+ 
+
+1% of the total number of securities of the same class then outstanding, which will equal 83,600 shares as of the date of this prospectus; or
+
+ 
+
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+the average weekly trading volume of such securities during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale;
+
+ 
+
+provided, in each case that we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale. Such sales must also comply with the manner of sale and notice provisions of Rule 144.
+
+As of the date of this prospectus, persons who are our affiliates hold all of the 6,000,000 shares that may be sold pursuant to Rule 144. Under Rule 144 the shares of an issuer that is not required to file reports under the Exchange Act can be publicly sold, subject to volume restrictions and restrictions on the manner of sale, commencing one year after their acquisition.
+
+Stock Option Grants 
+
+To date, we have not granted any stock options. 
+
+Registration Rights 
+
+We have not granted registration rights to the selling shareholders or to any other persons. 
+
+22 | Page
+
+Dividends 
+
+There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend: 
+
+1. 
+
+we would not be able to pay our debts as they become due in the usual course of business; or
+
+ 
+
+ 
+
+2. 
+
+our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of shareholders who have preferential rights superior to those receiving the distribution.
+
+ 
+
+We have not declared any dividends, and we do not plan to declare any dividends in the foreseeable future. 
+
+Management s Discussion and Analysis of Financial Condition and Results of OperationsWe are a development stage corporation. To date, our business operations have been limited to primarily, the development of a business plan and the completion of private placements for the offer and sale of our common stock. As of today, we have realized revenue in the amount of $2,475 and have earned minimal revenues and have minimal assets.. Our plan of operation is forward-looking. It is likely that we will not be able to achieve profitability and might need to cease operations due to the lack of funding.
+
+Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. We are not raising any money in this offering. Our only sources for cash at this time are investments by shareholders in our company and cash advances from our sole officer and director Irina Petrzhikovskaya. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
+
+Our office is currently located at Darzinu 22 linija, 10 Majas, Riga, Latvia LV-1063. Our telephone number is (702) 605-0519. This is the office of our Sole Officer and Director, Ms. Irina Petrzhikovskaya. We do not pay any rent to Ms. Petrzhikovskaya and there is no agreement to pay any rent in the future. As of the date of this prospectus, we have not sought or selected a new office location. We plan to establish an office in Latvia by the end of June, 2013. We will not be conducting any product research or development. We do not expect to purchase or sell plant or significant equipment. Further we do not expect significant changes in the number of employees. Upon completion of our public offering, our specific goal is to profitably sell our services. 
+
+23 | Page
+
+We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to: 
+
+ 
+
+ 
+
+ 
+
+have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; 
+
+ 
+
+ 
+
+ 
+
+provide an auditor attestation with respect to management s report on the effectiveness of our internal controls over financial reporting;
+
+ 
+
+ 
+
+ 
+
+comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); 
+
+ 
+
+ 
+
+ 
+
+ 
+
+submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and 
+
+ 
+
+ 
+
+ 
+
+ 
+
+disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO s compensation to median employee compensation. 
+
+ 
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards. 
+
+We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
+
+Following the date of this registration statement, our business plan for the next 12 months is as follows:
+
+April 2013-June 2013: Set up Office. Estimated cost $2,500.
+
+By the end of June, 2013, we plan to set up office in and acquire the necessary equipment to begin our business operations. We believe that it will cost at least $2,500 to set up office and obtain the necessary equipment to begin operations. Our sole officer and director will handle our administrative duties. 
+
+24 | Page
+
+May, 2013 September, 2013: Negotiate agreements with potential customers.
+
+Initially, our sole officer and director, Ms. Petrzhikovskaya, will look for potential customers. On January 14, 2013, we signed a Sales Distribution Agreement with Aldent LLC, a private Latvian company. During June-September, 2013 we plan to contact and start negotiations with other potential customers in Latvia. We will negotiate terms and conditions of collaboration. We will continue to search for new potential customers during the life of our operations. As of
+
+May 30
+
+, 2013 Aldent LLC is the only Latvian company with which we have signed service agreement.
+
+Even though the negotiation of additional agreements with customers will be ongoing during the life of our operations, we cannot guarantee that we will be able to find successful agreements, in which case our business may fail and we will have to cease our operations.
+
+Even if we are able to obtain sufficient number of service agreements at the end of the twelve month period, there is no guarantee that we will be able to attract and more importantly retain enough customers to justify our expenditures. If we are unable to generate a significant amount of revenue and to successfully protect ourselves against those risks, then it would materially affect our financial condition and our business could be harmed.
+
+June, 2013- September, 2013: Develop Our Website. Estimated cost $3,000
+
+Our director, Ms. Petrzhikovskaya will be in charge of registering our web domain. We have not registered any web domain as of the date of this prospectus. Once we register our web domain, we plan to hire a web designer to help us design and develop our website. We do not have any written agreements with any web designers at current time. The website development costs, including site design and implementation will be approximately $3,000. Updating and improving our website will continue throughout the lifetime of our operations. 
+
+August, 2013- December, 2013: Commence Marketing Campaign. Estimated cost $11,000.
+
+Once we commence website development, we will begin to market our products. Initially, our sole officer and director, Irina Petrzhikovskaya, will look for potential customers. We intend to use marketing strategies, such as web advertisements, direct mailing, and phone calls. We also expect to get new clients from Internet, social networking and "word of mouth" advertising. We intend to spend about $11,000 on marketing efforts during the first year. Marketing is an ongoing matter that will continue during the life of our operations. 
+
+October, 2013-March, 2014: Hire a Salesperson. Estimated cost $6,000
+
+Initially, our sole officer and director will look for potential customers for our product. Once we begin to sell our teeth whitening strips we may hire one part-time salesperson with good knowledge and broad connections to the dental industry to introduce our product. This individual will be an independent contractor compensated solely in the form of commissions. 
+
+25 | Page
+
+We therefore expect to incur the following costs in the next 12 months in connection with our business operations:
+
+Office set up
+
+$2,500
+
+Marketing costs
+
+$11,000
+
+Website development costs
+
+ $3,000
+
+Estimated cost of this offering
+
+ $10,000
+
+Costs associated with being a publicly reporting company
+
+$10,000
+
+Total
+
+ $36,500
+
+Our current cash reserves are not sufficient to meet our obligations for the next twelve-month period. As a result, we will need to seek additional funding in the near future. We are not raising any money in this offering. Our only sources for cash at this time are investments by shareholders in our company and cash advances from our sole director, Ms. Irina Petrzhikovskaya. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
+
+ 
+
+Limited operating history; need for additional capital 
+
+There is no historical financial information about us upon which to base an evaluation of our performance. We are in start-up stage operations and have generated just $2,475 in revenue. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products. 
+
+As of
+
+May 30
+
+, 2013 our cash balance is $24,047. We can currently remain in operation without additional financing for approximately 8 month. Our current cash reserves are not sufficient to meet our obligations for the next twelve-month period. As a result, we will need to seek additional funding in the near future. We anticipate that additional funding will be from the sale of additional common stock. We may seek to obtain short-term loans from our director as well, although there is no guarantee that we will be able obtain such funds. Irina Petrzhikovskaya, our sole officer and director, has verbally agreed to loan the company funds. However, there is no written agreement in place and no limit on the amount of funds that she has agreed to provide has been indicated. At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through a loan from our director to meet our obligations over the next twelve months. We do not have any arrangements in place for any future equity financing. If we are unable to raise the required financing, our operations could be materially adversely affected and we could be forced to cease operations.
+
+Results of Operations for Period Ending April 30, 2013 
+
+Since our inception on February 9, 2012 to April 30, 2013, we have realised net loss of $5,841. As of April 30, 2013 we had cash of $24,047 in our bank accounts. However, we anticipate that we will incur substantial losses over the next 12 months. 
+
+We have not attained profitable operations and are dependent upon obtaining financing to continue with our business plan. For these reasons, there is substantial doubt that we will be able to continue as a going concern. 
+
+26 | Page
+
+Changes In and Disagreements with Accountants 
+
+We have had no changes in or disagreements with our accountants. 
+
+ Available Information
+
+We have filed a registration statement on Form S-1 under the Securities Act of 1933 with the Securities and Exchange Commission with respect to the shares of our common stock offered through this prospectus. This prospectus is filed as a part of that registration statement, but does not contain all of the information contained in the registration statement and exhibits. Statements made in the registration statement are summaries of the material terms of the referenced contracts, agreements or documents of the company. We refer you to our registration statement and each exhibit attached to it for a more detailed description of matters involving the company, and the statements we have made in this prospectus are qualified in their entirety by reference to these additional materials. You may inspect the registration statement, exhibits and schedules filed with the Securities and Exchange Commission at the Commission s principal office in Washington, D.C. Copies of all or any part of the registration statement may be obtained from the Public Reference Section of the Securities and Exchange Commission, 100 F Street NE, Washington, D.C. 20549. D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms.
+
+The Securities and Exchange Commission also maintains a web site at http://www.sec.gov that contains reports, proxy statements and information regarding registrants that file electronically with the Commission. Our registration statement and the referenced exhibits can also be found on this site. 
+
+Reports to Security Holders
+
+Upon effectiveness of this Prospectus, we will be subject to the reporting and other requirements of the Exchange Act. We will make available to our shareholders annual reports containing financial statements audited by our independent auditors and our quarterly reports containing unaudited financial statements for each of the first three quarters of each year; however, we will not send the annual report to our shareholders unless requested by an individual shareholder. 
+
+The public may read and copy any materials that we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that site is www.sec.gov. 
+
+Directors, Executive Officers, Promoters and Control Persons
+
+Our executive officer and director and his age as of the date of this prospectus is as follows: 
+
+27 | Page
+
+Director: 
+
+Name of Director 
+
+ 
+
+Age 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ Irina Petrzhikovskaya
+
+ 
+
+32
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Executive Officers: 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Name of Officer 
+
+ 
+
+Age 
+
+ 
+
+Office 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ Irina Petrzhikovskaya
+
+ 
+
+32
+
+ 
+
+President, Chief Executive Officer, Treasurer, Chief Financial Officer and Chief Accounting Officer, Secretary
+
+Biographical Information 
+
+Set forth below is a brief description of the background and business experience of our officers and sole director for the past five years. 
+
+Ms. Petrzhikovskaya owns 71.77% of the outstanding shares of our common stock.
+
+Ms. Irina Petrzhikovskaya has acted as our President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors since our incorporation on February 9, 2012. 
+
+At the time of incorporation she owned 100% of the company s shares.
+
+As such, 
+
+she appointed herself as
+
+ our sole President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors. 
+
+There were no other persons who nominated and appointed Ms. Petrzhikovskaya as a director.
+
+This decision did not in any manner relate to Ms. Petrzhikovskaya s previous employments. Ms. Petrzhikovskaya s previous experience, qualifications, attributes or skills were not considered when he was appointed as our sole President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors. Since 2006, Ms. Petrzhikovskaya has been working as sole proprietor in real estate. She owns few income properties in Riga, Latvia. Ms. Petrzhikovskaya intends to devote close to 20 hours a week to planning and organizing activities of Alphala Corp.
+
+During the past ten years, Ms. Petrzhikovskaya has not been the subject to any of the following events:
+
+ 1. Any bankruptcy petition filed by or against any business of which Ms. Petrzhikovskaya was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.
+
+ 2. Any conviction in a criminal proceeding or being subject to a pending criminal proceeding.
+
+ 3. An order, judgment, or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting Mr. Petrzhikovskaya s involvement in any type of business, securities or banking activities.
+
+ 4. Found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Future Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
+
+28 | Page
+
+Significant Employees 
+
+We have no significant employees other than our officers and sole director. 
+
+Audit Committee Financial Expert
+
+We do not have an audit committee financial expert. We do not have an audit committee financial expert because we believe the cost related to retaining a financial expert at this time is prohibitive. Further, because we have no operations, at the present time, we believe the services of a financial expert are not warranted.
+
+Conflicts of Interest 
+
+Ms. Irina Petrzhikovskaya, our President will be devoting approximately 20 hours/week to our operations. Because Ms. Petrzhikovskaya will only be devoting limited time to our operations, our operations may be sporadic and occur at times which are convenient to her. As a result, operations may be periodically interrupted or suspended which could result in a lack of revenues and a cessation of operations.
+
+Executive Compensation
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001567503_turnkey_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001567503_turnkey_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..28993e5727a7ef33df1c7a8c7ef8a80897001e62
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001567503_turnkey_prospectus_summary.txt
@@ -0,0 +1,1733 @@
+Summary Financial Information 
+
+The following financial information summarizes the more complete historical financial information at the end of this prospectus.
+
+ 
+
+As of March 31, 2013 (Unaudited)
+
+Balance Sheet 
+
+ 
+ 
+ 
+
+Total Assets 
+
+ 
+
+$
+
+ 20,340
+
+Total Liabilities 
+
+ 
+
+$
+
+ 512 
+
+Stockholders Equity 
+
+ 
+
+$
+
+ 19,828
+
+ 
+
+ Period from September 7, 2012 (date of inception) to March 31,2013 (Unaudited) 
+
+Income Statement 
+
+ 
+ 
+ 
+
+Revenue 
+
+ 
+
+$
+
+ 4,870
+
+Total Expenses 
+
+ 
+
+$
+
+ 7,004
+
+Corporate Income Taxes 
+
+ 
+
+$
+
+238
+
+Net Loss 
+
+ 
+ 
+$(2,372)
+
+Risk Factors related to our Business and Industry
+
+Please consider the following risk factors before deciding to invest in our common stock. Any investment in our common stock is speculative. You should carefully consider the risks described below and all of the information contained in this Prospectus before deciding whether to purchase our common stock. If any of the following risks actually occur, our business, financial condition and results of operations could be harmed. If any of these risks materialize, the trading price of our common stock could decline and you may lose all or part of your investment. All material risks were included in this section.
+
+WE LACK AN OPERATING HISTORY AND THERE IS NO ASSURANCE OUR FUTURE OPERATIONS WILL RESULT IN SIGNIFICANT REVENUES OR PROFITABILITY. IF WE CANNOT GENERATE SUFFICIENT REVENUES TO OPERATE PROFITABLY, WE MAY SUSPEND OR CEASE OPERATIONS.
+
+We were incorporated on September 7, 2012, and since inception through March 31, 2013 the Company has generated revenues of $4,870 and has accumulated losses of $2,372. We have little operating history upon which an evaluation of our future success or failure can be made. Based upon current plans, we expect to incur operating losses in the foreseeable future because we will be incurring large expenses consisting mostly of general administrative expenses, business development, marketing costs, support materials and costs associated with being a publicly reporting company and generating small revenues. Failure to generate significant revenues in the future will cause us to go out of business.
+
+IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUR BUSINESS MAY FAIL.
+
+While on March 31, 2013, we had cash on hand of $20,340, our current cash reserves are not sufficient to meet our obligations for the next twelve-month period. We anticipate that the approximate cost of the offering will be $
+
+16,750
+
+ ($
+
+15,670
+
+ has already been paid to cover for the offering expenses and comprised $2,500 for the legal fees, $4,750 for the audit fees, $
+
+8,400
+
+ for the transfer agent fees and $20 for the SEC registration fees). We anticipated that the minimum capital necessary to fund our planned operations for the 12-month period would be approximately $
+
+38,750
+
+.
+
+The twelve-month period is being measured from January 30, 2013 - the date when our registration statement was filed. 
+
+As of
+
+June 25
+
+, 2013 we have already incurred and paid $
+
+15,670
+
+ included into $
+
+38,750
+
+ and therefore the estimated minimum capital necessary to fund our planned operations
+
+is
+
+ approximately $
+
+23,080
+
+ and will be needed for general administrative expenses, business development, marketing costs, support materials and costs associated with being a publicly reporting company. Since inception through March 31, 2013 the Company has generated revenues of $4,870 and has accumulated losses of $2,372. In order to expand our business operations, we anticipate that we will have to raise additional funding. If we are not able to raise the capital necessary to fund our business expansion objectives, we may have to delay the implementation of our business plan.
+
+7 | Page
+
+We do not currently have any arrangements for financing. Obtaining additional funding will be subject to a number of factors, including general market conditions, investor acceptance of our business plan and initial results from our business operations. These factors may impact the timing, amount, terms or conditions of additional financing available to us. 
+
+We are not raising any money in this offering. The most likely source of future funds available to us is through the sale of additional shares of common stock, revenues realized pursuant to the agreement signed with Finca La Esmeralda or advances from our sole director.
+
+There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
+
+LACK OF SIGNIFICANT REVENUES TO DATE MAY CAUSE A SUBSTANTIAL DOUBT AS TO WHETHER WE WILL CONTINUE OPERATIONS. IF WE DISCONTINUE OPERATIONS, YOU COULD LOSE YOUR INVESTMENT.
+
+Vanell, Corp. was incorporated on September 7, 2012. We are a development stage company. Even though we have earned revenues of $
+
+6,870
+
+ as of the date of this prospectus the company has accumulated losses of $2,372 since inception to March 31, 2013 you cannot evaluate our business, and therefore our future prospects, due to a lack of operating history and small revenues. To date, our business operations have been limited to primarily, the development of a business plan, the completion of private placements for the offer and sale of our common stock, discussing the offer of consulting services with potential customers, and the signing of the consulting service agreement with Finca La Esmeralda, a private El Salvador company. Potential investors should be aware of the difficulties normally encountered by development stage companies and the high rate of failure of such enterprises. In addition, there is no guarantee that we will be able to expand our business operations. Even if we expand our operations, at present, we do not know precisely when this will occur.
+
+We cannot guarantee that we will be successful in generating significant revenues and profit in the future. Failure to generate significant revenues and profit will cause us to suspend or cease operations. If this happens, you could lose all or part of your investment.
+
+WE FACE STRONG COMPETITION FROM LARGER AND WELL ESTABLISHED COMPANIES, WHICH COULD HARM OUR BUSINESS AND ABILITY TO OPERATE PROFITABLY.
+
+Our industry is competitive. There are many different companies that provide consulting services in commercial cultivation and processing of coffee in El Salvador and our services are not unique to their services. Even though the industry is highly fragmented, it has a number of large and well established companies, which are profitable and have developed a brand name. Aggressive marketing tactics implemented by our competitors could impact our limited financial resources and adversely affect our ability to compete in our market.
+
+COMPETITION FOR POTENTIAL CUSTOMER ACCOUNTS IS INTENSE. FAILURE TO COMPETE WILL AFFECT OUR FINANCIAL CONDITION.
+
+Winning customers will be critical to our ability to grow our business. Competition for potential customer accounts is intense. Failing to obtain orders for our services from potential customers, for competitive reasons or otherwise, would materially adversely affect our operating results and financial condition.
+
+WE PROVIDE OUR CONSULTING SERVICES TO ONE CUSTOMER. IF THAT CUSTOMER DECREASED, MODIFIED OR TERMINATED ITS RELATIONSHIP WITH US, OUR BUSINESS WOULD LIKELY FAIL IF WE ARE UNABLE TO FIND A SUBSTITUTE FOR THAT CUSTOMER.
+
+We signed the consulting service agreement with Finca La Esmeralda, a private El Salvador company. Our agreement with this company does not prevent it from termination of its relationship with us. If this company decreased, modified or terminated its association with us for any reason, we would suffer an interruption in our business unless and until we found a substitute for that customer. If we were unable to find a substitute for that customer, our business would likely fail. We cannot predict what the likelihood would be of finding an acceptable substitute customer.
+
+8 | Page
+
+PRICE COMPETITION COULD NEGATIVELY AFFECT OUR GROSS MARGINS.
+
+Price competition could negatively affect our operating results. To respond to competitive pricing pressures, we will have to offer our services at lower prices in order to retain or gain market share and customers. If our competitors offer discounts on certain services in the future, we will need to lower prices to match the competition, which could adversely affect our gross margins and operating results. 
+
+BECAUSE MR. MAGANA, OUR SOLE OFFICER AND DIRECTOR, IS NOT A RESIDENT OF THE UNITED STATES IT MAY BE DIFFICULT TO ENFORCE ANY LIABILITIES AGAINST HIM.
+
+Accordingly, if an event occurs that gives rise to any liability, shareholders would likely have difficulty in enforcing such liabilities because Mr. Francisco Douglas Magana, our sole officer and director resides outside the United States. If a shareholder desired to sue, the shareholder would have to serve a summons and complaint. Even if personal service is accomplished and a judgment is entered against a person, the shareholder would then have to locate assets of that person, and register the judgment in the foreign jurisdiction where assets are located.
+
+BECAUSE COMPANY S HEADQUARTERS ARE LOCATED OUTSIDE THE UNITED STATES, U.S. INVESTORS MAY EXPERIENCE DIFFICULTIES IN ATTEMPTING TO AFFECT SERVICE OF PROCESS AND TO ENFORCE JUDGMENT BASED UPON U.S. FEDERAL SECURITIES LAWS AGAINST THE COMPANY AND ITS NON U.S. RESIDENT OFFICER AND DIRECTOR.
+
+While we are organized under the laws of State of Nevada, our officer and director is a non-U.S. resident and our headquarters are located outside the United States. Consequently, it may be difficult for investors to affect service of process in the United States and to enforce in the United States judgments obtained in United States courts based on the civil liability provisions of the United States securities laws. Since all our assets will be located in El Salvador, they will be outside of the jurisdiction of United States courts to administer, if we become subject of an insolvency or bankruptcy proceeding. As a result, if we declare bankruptcy or insolvency, our shareholders may not receive the distributions on liquidation that they would otherwise be entitled to if our assets were to be located within the United States under United States bankruptcy laws.
+
+WE MAY BE EXPOSED TO POTENTIAL RISKS RESULTING FROM NEW REQUIREMENTS UNDER SECTION 404 OF THE SARBANES-OXLEY ACT OF 2002.
+
+Upon the effectiveness of our registration statement, we will be newly public company. We will not need to comply with Section 404 of the Sarbanes-Oxley Act until we file our second annual report with the SEC. However, we will need to include a statement in our first annual report and we must indicate that the annual report does not include either a management s report on internal control or auditor attestation of internal control. 
+
+We have not yet completed our assessment of the effectiveness of our internal control over financial reporting, and we expect to incur additional expenses and diversion of management s time as a result of performing the system and process evaluation, testing and remediation required in order for us and our auditors to comply with the auditor attestation requirements.
+
+9 | Page
+
+AS AN EMERGING GROWTH COMPANY UNDER THE JOBS ACT, WE ARE PERMITTED TO RELY ON EXEMPTIONS FROM CERTAIN DISCLOSURE REQUIREMENTS. 
+
+We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to: 
+
+-
+
+have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; 
+
+-
+
+comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); 
+
+-
+
+submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and 
+
+-
+
+ disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive s compensation to median employee compensation. 
+
+ 
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
+
+We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
+
+Until such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
+
+BECAUSE OUR SOLE OFFICER AND DIRECTOR HAS OTHER BUSINESS INTERESTS, HE MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL. 
+
+Our sole officer and director, Mr. Francisco D. Magana, will only be devoting limited time to our operations. Mr. Magana intends to devote approximately 25 hours a week of his business time to our affairs. Because our sole officer and director will only be devoting limited time to our operations, our operations may be sporadic and occur at times which are convenient to him. As a result, our operations may be periodically interrupted or suspended which could result in a lack of significant revenues and a possible cessation of operations. It is possible that the demands on Mr. Magana from his other obligations could increase with the result that he would no longer be able to devote sufficient time to the management of our business. In addition, Mr. Magana may not possess sufficient time for our business if the demands of managing our business increase substantially beyond current levels.
+
+10 | Page
+
+BECAUSE OUR SOLE DIRECTOR HAS AN INTEREST IN A COMPANY INVOLVED IN THE SAME INDUSTRY, THERE IS A POTENTIAL CONFLICT OF INTEREST, INCLUDING THE AMOUNT OF TIME HE IS ABLE TO DEDICATE TO VANELL, CORP. AND ITS BUSINESS.
+
+Our sole director Mr. Magana is associated with another company that is engaged in business activities similar to those conducted by us. Mr. Magana is owner of the agricultural company FDMag S.A. de C.V. while also providing consulting services to commercial coffee growers in El Salvador. FDMag S.A. de C.V. is not an affiliate of Vanell, Corp. Potential conflict of interest may arise in future that may cause our business to fail, including conflict of interest in allocating Mr. Magana s time to our company as well as additional conflict of interests over determining to which entity a particular business opportunity should be presented. We do not currently have a right of first refusal pertaining to business opportunities that come to management's attention, which is inconsistent with Mr. Magana s fiduciary duties under Nevada state law that provides that corporations may include a provision in their articles of incorporation relieving directors of monetary liability for breach of their fiduciary duty as directors, provided that such provision shall not eliminate or limit the liability of a director for any beach of the director s duty of loyalty to the corporation and its shareholders. While our sole officer and director has verbally agreed to present business opportunities first to us, subject to any pre-existing duty he may have, we have not adopted a policy that expressly prohibits our sole officer and director Mr. Magana from having a direct or indirect financial interest in potential future opportunity or from engaging in business activities of the types conducted by us. As a result, in determining to which entity particular business opportunities should be presented, our sole officer and director Mr. Magana may favor him own interests and the interests of FDMag S.A. de C.V. over our interests and those of our shareholders, which could have a material adverse effect on our business and results of operations.
+
+IF MR. MAGANA, OUR SOLE OFFICER AND DIRECTOR, SHOULD RESIGN OR DIE, WE WILL NOT HAVE AN OFFICER OR A DIRECTOR. THIS COULD RESULT IN OUR OPERATIONS SUSPENDING, AND YOU COULD LOSE YOUR INVESTMENT.
+
+We extremely depend on the services of our sole officer and director, Mr. Magana, for the future success of our business. The loss of the services of Mr. Magana could have an adverse effect on our business, financial condition and results of operations. If he should resign or die we will not have a chief executive officer. If that should occur, until we find another person to act as our chief executive officer, our operations could be suspended. In that event it is possible you could lose your entire investment.
+
+BECAUSE OUR SOLE OFFICER AND DIRECTOR OWNS 77.84% OF OUR ISSUED AND OUTSTANDING COMMON STOCK, HE COULD MAKE AND CONTROL CORPORATE DECISIONS THAT MAY BE DISADVANTAGEOUS TO MINORITY SHAREHOLDERS.
+
+Our sole officer and director, Francisco Magana, owns approximately 77.32% of the outstanding shares of our common stock. However, Francisco Douglas Magana and Claudia Morales de Magana are husband and wife. Accordingly, each is deemed to be the beneficial owners of their spouse s shares. Therefore the total approximate percentage of shares, including Claudia Morales de Magana s shares, owned by our sole officer and director Mr. Francisco Douglas Magana is 77.84%. Accordingly, he will have a significant influence in determining the outcome of all corporate transactions or other matters, including mergers, consolidations, and the sale of all or substantially all of our assets. He will also have the power to prevent or cause a change in control. The interests of our sole officer and director may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other shareholders.
+
+11 | Page
+
+WE DO NOT EXPECT TO PAY DIVIDENDS IN THE FORESEEABLE FUTURE.
+
+We have never paid any dividends on our common stock. We do not expect to pay cash dividends on our common stock at any time in the foreseeable future. The future payment of dividends directly depends upon our future earnings, capital requirements, financial requirements and other factors that our board of directors will consider. Since we do not anticipate paying cash dividends on our common stock, a return on your investment, if any, will depend solely on an increase, if any, in the market value of our common stock.
+
+ANY ADDITIONAL FUNDING WE ARRANGE THROUGH THE SALE OF OUR COMMON STOCK WILL RESULT IN DILUTION TO EXISTING SHAREHOLDERS.
+
+We must raise additional capital in order for our business plan to succeed. We are not raising any money in this offering. Our most likely source of additional capital will be through the sale of additional shares of common stock. Such stock issuances will cause stockholders' interests in our company to be diluted. Such dilution will negatively affect the value of investors shares.
+
+OUR SHARES OF COMMON STOCK ARE SUBJECT TO THE PENNY STOCK RULES OF THE SECURITIES AND EXCHANGE COMMISSION AND THE TRADING MARKET IN OUR SECURITIES WILL BE LIMITED, WHICH WILL MAKE TRANSACTIONS IN OUR STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR STOCK.
+
+The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules. If a trading market for our common stock develops, our common stock will probably become subject to the penny stock rules, and shareholders may have difficulty in selling their shares.
+
+IF OUR SHARES OF COMMON STOCK COMMENCE TRADING ON THE OTC BULLETIN BOARD, THE TRADING PRICE MAY FLUCTUATE SIGNIFICANTLY AND STOCKHOLDERS MAY HAVE DIFFICULTY RESELLING THEIR SHARES.
+
+As of the date of this Registration Statement, our common stock does not yet trade on the Over-the-Counter Bulletin Board. If our shares of common stock commence trading on the Bulletin Board, there is a volatility associated with Bulletin Board securities in general and the value of your investment could decline due to the impact of any of the following factors upon the market price of our common stock: (i) disappointing results from our development efforts; (ii) failure to meet our revenue or profit goals or operating budget; (iii) decline in demand for our common stock; (iv) downward revisions in securities analysts' estimates or changes in general market conditions; (v) technological innovations by competitors or in competing technologies; (vi) lack of funding generated for operations; (vii) investor perception of our industry or our prospects; and (viii) general economic trends.
+
+12 | Page
+
+On April 1, 2013 we signed the agreement with Spartan Securities, Ltd. to file the Form 211 listing application for Vanell, Corp. with FINRA. There is no current trading market for our securities and if a trading market does not develop, purchasers of our securities may have difficulty selling their shares. In addition, stock markets have experienced price and volume fluctuations and the market prices of securities have been highly volatile. These fluctuations are often unrelated to operating performance and may adversely affect the market price of our common stock. As a result, investors may be unable to sell their shares at a fair price and you may lose all or part of your investment.
+
+FOLLOWING THE EFFECTIVE DATE OF OUR REGISTRATION STATEMENT, OF WHICH THIS PROSPECTUS IS A PART, WE WILL BE SUBJECT TO THE PERIODIC REPORTING REQUIREMENTS OF SECTION 15(D) OF THE EXCHANGE ACT THAT WILL REQUIRE US TO INCURE AUDIT FEES AND LEGAL FEES IN CONNECTION WITH THE PREPARATION OF SUCH REPORTS. THESE ADDITIONAL COSTS COULD REDUCE OR ELIMINATE OUR ABILITY TO EARN A PROFIT.
+
+Following the effective date of our registration statement of which this prospectus is a part, we will be required to file periodic reports with the SEC pursuant to the Exchange Act and the rules and regulations promulgated thereunder. In order to comply with these requirements, our independent registered public accounting firm will have to review our financial statements on a quarterly basis and audit our financial statements on an annual basis. Moreover, our legal counsel will have to review and assist in the preparation of such reports. The costs charged by these professionals for such services cannot be accurately predicted at this time because factors such as the number and type of transactions that we engage in and the complexity of our reports cannot be determined at this time and will have a major affect on the amount of time to be spent by our auditors and attorneys. However, the incurrence of such costs will obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a profit. We may be exposed to potential risks resulting from any new requirements under Section 404 of the Sarbanes-Oxley Act of 2002. If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock, if a market ever develops, could drop significantly.
+
+THERE IS NO CURRENT TRADING MARKET FOR OUR SECURITIES AND IF A TRADING MARKET DOES NOT DEVELOP, PURCHASERS OF OUR SECURITIES MAY HAVE DIFFICULTY SELLING THEIR SHARES.
+
+There is currently no established public trading market for our securities and an active trading market in our securities may not develop or, if developed, may not be sustained. We intend to have a market maker apply for admission to quotation of our securities on the Over-the-Counter Bulletin Board after the Registration Statement relating to this prospectus is declared effective by the SEC. On April 1, 2013 we signed the agreement with Spartan Securities, Ltd. to file the Form 211 listing application for Vanell, Corp. with FINRA. If for any reason our common stock is not quoted on the Over-the-Counter Bulletin Board or a public trading market does not otherwise develop, purchasers of the share may have difficulty selling their common stock should they desire to do so. 
+
+WE HAVE NO EXPERIENCE AS A PUBLIC COMPANY.
+
+We have never operated as a public company. Mr. Magana our sole director and officer has no experience managing a public company which is required to establish and maintain disclosure controls and procedures and internal control over financial reporting. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required of a public company. However, if we cannot operate successfully as a public company, your investment may be adversely affected. Our inability to operate as a public company could be the basis of your losing your entire investment in us.
+
+13 | Page
+
+Forward-Looking Statements
+
+This prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward-looking statements. You should not place too much reliance on these forward-looking statements. Our actual results are most likely to differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in the Risk Factors section and elsewhere in this prospectus. 
+
+Use of Proceeds
+
+We will not receive any proceeds from the sale of the common stock offered through this prospectus by the selling shareholders. 
+
+Determination of Offering Price 
+
+The selling shareholders will sell our shares at $0.06 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. We determined this offering price arbitrarily, by adding a $0.03 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering until and unless the security is subsequently listed on an exchange or is listed by a market maker on the OTC BB. Currently the company is not so listed and there is no assurance that the stock will ever be so listed. 
+
+Dilution
+
+The common stock to be sold by the selling shareholders is common stock that is currently issued and outstanding. Accordingly, there will be no dilution to our existing shareholders. 
+
+Selling Shareholders 
+
+The selling shareholders named in this prospectus are offering all of the 880,000 shares of common stock offered through this prospectus. These shares were acquired from us in private placements that were exempt from registration under Regulation S promulgated pursuant to the Securities Act of 1933. All shares were acquired outside of the United States by non-U.S. persons. The shares include the following: 
+
+1. 720,000 shares of our common stock that the selling shareholders acquired from us in an offering that was completed on November 19, 2012; 
+
+2. 160,000 shares of our common stock that the selling shareholders acquired from us in an offering that was completed on December 14, 2012. 
+
+14 | Page
+
+The following table provides as of the date of this prospectus, information regarding the beneficial ownership of our common stock held by each of the selling shareholders, including: 
+
+1. the number of shares owned by each prior to this offering;
+
+2. the total number of shares that are to be offered for each;
+
+3. the total number of shares that will be owned by each upon completion of the offering; and
+
+4. the percentage owned by each upon completion of the offering.
+
+Name Of 
+
+Selling Shareholder
+
+Shares Owned Prior To This Offering
+
+Total Number Of Shares To Be Offered For Selling Shareholders Account
+
+Total Shares to Be Owned Upon Completion Of This Offering
+
+Percentage of Shares owned Upon Completion of This Offering
+
+Position, office or other material relationship to the Company 
+
+Adan Adolfo Merlos Linares
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Luis Alonso Barrientos Lopez
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Roberto Orlando Garcia Tejada
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Edgar Orlando Rivera
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Marvin Benedicto Lue Morales
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Sarai Del Socorro Beltran Leonardo
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Fatima Sofia Rodas Delgado
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Sergio Ulises Armas Hernandez
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Elmer Leonidas Mendez Aquino
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Nelson Gerardo Paredez Guzman
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Xiomara Magdalena Ventura de Fajardo
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Antonio de Jesus Ortiz Espinoza
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Cecilia del Carmen Morales Ramon 
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Cesar Armando Castillo Acevedo
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Tatiana Fabiola Alas Morales
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Claudia Maria Colindres Mendez
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Guadalupe Araceli Barillas Lopez
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Leticia Lizzette Gracia Chavez
+
+40,000
+
+40,000
+
+Nil
+
+Nil
+
+ 
+
+Jaime Henry Martinez Lemus
+
+20,000
+
+20,000
+
+Nil
+
+Nil
+
+ 
+
+Claudia Morales de Magana 
+
+Claudia Morales de Magana including shares of Francisco D. Magana (1)
+
+20,000
+
+3,020,000
+
+20,000
+
+20,000
+
+Nil
+
+3,000,000 (*)
+
+Nil
+
+77.32%(**)
+
+Spouse of our sole Director and Officer 
+
+Douglas Antonio Orozco Lemus
+
+20,000
+
+20,000
+
+Nil
+
+Nil
+
+ 
+
+Guillermo Alexander Lopez Moran
+
+20,000
+
+20,000
+
+Nil
+
+Nil
+
+ 
+
+Julio Renaldo Catota
+
+20,000
+
+20,000
+
+Nil
+
+Nil
+
+ 
+
+Mauricio Marcelo Shupan Pinto
+
+20,000
+
+20,000
+
+Nil
+
+Nil
+
+ 
+
+Moises Alberto Mejia Rivas
+
+20,000
+
+20,000
+
+Nil
+
+Nil
+
+ 
+
+Sandra Elizabeth Ruiz Lemus
+
+20,000
+
+20,000
+
+Nil
+
+Nil
+
+ 
+
+(1) Francisco Douglas Magana and Claudia Morales de Magana are husband and wife. Accordingly, each is deemed to be the beneficial owners of their spouse s shares. Ms. Claudia Morales de Magana owns 20,000 shares and is deemed to be the beneficial owner of 3,000,000 shares owned by Mr. Francisco Douglas Magana, our sole officer and director.
+
+(*)
+
+3,000,000 shares of our common are available for resale to the public in accordance with the volume and trading limitations of Rule 144. 
+
+(**) This percentage is based on 3,880,000 shares of common stock issued and outstanding on the date of this prospectus.
+
+Besides the above, there are no relationships between our selling shareholders and our sole officer and director.
+
+The named party beneficially owns and has sole voting and investment power over all shares or rights to these shares. The numbers in this table assume that none of the selling shareholders sells shares of common stock not being offered in this prospectus or purchases additional shares of common stock, and assumes that all shares offered are sold. The percentages are based on 880,000 shares of common stock issued and outstanding on the date of this prospectus. 
+
+Other than disclosed above, none of the selling shareholders: 
+
+1.
+
+has had a material relationship with us other than as a shareholder at any time within the past three years; 
+
+2.
+
+has ever been one of our officers or directors;
+
+3.
+
+is a broker-dealer; or a broker-dealer's affiliate.
+
+15 | Page
+
+Plan of Distribution 
+
+The selling shareholders may sell some or all of their common stock in one or more transactions, including block transactions. There are no arrangements, agreements or understandings with respect to the sale of these securities. 
+
+The selling shareholders will sell our shares at $0.06 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. We determined this offering price arbitrarily by adding a $0.03 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering until and unless the security is subsequently listed on an exchange or is listed by a market maker on the OTC BB. Currently the company is not so listed and there is no assurance that the stock will ever be so listed.
+
+The shares may also be sold in compliance with the Securities and Exchange Commission's Rule 144, when eligible.
+
+If applicable, the selling shareholders may distribute shares to one or more of their partners who are unaffiliated with us. Such partners may, in turn, distribute such shares as described above. If these shares being registered for resale are transferred from the named selling shareholders and the new shareholders wish to rely on the prospectus to resell these shares, then we must first file a prospectus supplement naming these individuals as selling shareholders and providing the information required concerning the identity of each selling shareholder and he or her relationship to us. There is no agreement or understanding between the selling shareholders and any partners with respect to the distribution of the shares being registered for resale pursuant to this registration statement. 
+
+We can provide no assurance that all or any of the common stock offered will be sold by the selling shareholders. 
+
+We are bearing all costs relating to the registration of the common stock. The selling shareholders, however, will pay any commissions or other fees payable to brokers or dealers in connection with any sale of the common stock. 
+
+The selling shareholders must comply with the requirements of the Securities Act of 1933 and the Securities Exchange Act of 1934 in the offer and sale of the common stock. In particular, during such times as the selling shareholders may be deemed to be engaged in a distribution of the common stock, and therefore be considered to be an underwriter, they must comply with applicable law and may, among other things: 
+
+ 
+
+1.
+
+Not engage in any stabilization activities in connection with our common stock;
+
+ 
+
+ 
+ 
+
+ 
+
+2.
+
+Furnish each broker or dealer through which common stock may be offered, such copies of this prospectus, as amended from time to time, as may be required by such broker or dealer; and
+
+ 
+
+ 
+ 
+
+ 
+
+3.
+
+Not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities other than as permitted under the Securities Exchange Act.
+
+16 | Page
+
+The Securities and Exchange Commission (the Commission ) has also adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). 
+
+The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the Commission, which contains: 
+
+-
+
+a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;
+
+-
+
+a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements;
+
+-
+
+a brief, clear, narrative description of a dealer market, including "bid" and "ask" prices for penny stocks and the significance of the spread between the bid and ask price;
+
+-
+
+a toll-free telephone number for inquiries on disciplinary actions;
+
+-
+
+a definition of significant terms in the disclosure document or in the conduct of trading penny stocks; and
+
+-
+
+such other information and is in such form (including language, type, size, and format) as the Commission shall require by rule or regulation.
+
+The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with: 
+
+-
+
+bid and offer quotations for the penny stock;
+
+-
+
+the compensation of the broker-dealer and its salesperson in the transaction;
+
+-
+
+the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and
+
+-
+
+monthly account statements showing the market value of each penny stock held in the customer's account.
+
+In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement. These disclosure requirements will have the effect of reducing the trading activity in the secondary market for our stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficulty selling those securities. 
+
+Description of Securities 
+
+General 
+
+Our authorized capital stock consists of 75,000,000 shares of common stock at a par value of $0.001 per share. 
+
+17 | Page
+
+Common Stock 
+
+As of
+
+June 25
+
+, 2013 there were 3,880,000 shares of our common stock issued and outstanding held by 27 stockholders of record. 
+
+Holders of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of common stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of common stock voting for the election of directors can elect all of the directors. Holders of our common stock representing a majority of the voting power of our capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our articles of incorporation. 
+
+Holders of common stock are entitled to share in all dividends that the board of directors, in its discretion, declares from legally available funds. In the event of liquidation, dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock. Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock. 
+
+Preferred Stock
+
+We do not have an authorized class of preferred stock. 
+
+Dividend Policy 
+
+We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future. 
+
+Share Purchase Warrants 
+
+We have not issued and do not have any outstanding warrants to purchase shares of our common stock. 
+
+Options 
+
+We have not issued and do not have any outstanding options to purchase shares of our common stock. 
+
+Convertible Securities 
+
+We have not issued and do not have any outstanding securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock. 
+
+Interests of Named Experts and Counsel 
+
+No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, an interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee. 
+
+Stepp Law Corporation has provided an opinion on the validity of our common stock.
+
+The financial statements included in this prospectus and the registration statement have been audited by Ronald R. Chadwick, P.C. to the extent and for the periods set forth in their report appearing elsewhere in this document and in the registration statement filed with the SEC, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.
+
+18 | Page
+
+Description of Business 
+
+Overview 
+
+We were incorporated in the State of Nevada on September 7, 2012. To date, our business operations have been limited to primarily, the development of a business plan and execution of the consulting agreement with a Finca La Esmeralda, a private El Salvadorian company. We provide consulting services in commercial cultivation and processing of coffee in El Salvador. We plan to expand our services to North American market in the future if we have the available resources and growth to warrant it. We are a development stage company and cannot state with certainty whether we will achieve significant profitability. We have earned minimal revenues since inception and have minimal assets. Our plan of operation is forward-looking. It is likely that we will not be able to achieve significant profitability and might need to cease operations due to the lack of funding. We maintain our statutory registered agent's office at 2360 Corporate Circle, Ste. 400 Henderson, Nevada 89074-7722. Our business office is located at Res. San Antonio Bk. 10, Pje. 7 N5 San Antonio Del Monte, Sonsonate, El Salvador SV-106090030. Our telephone number is +011-503-79511698.
+
+Consulting Services
+
+Our consulting services for commercial growers of coffee include: 
+
+- Consulting in cultivation and harvesting processes 
+
+- Quality control 
+
+- Hygiene check 
+
+- Improvement of cultivation methods
+
+- Improvement of fruiting techniques
+
+- Improvement of coffee quality
+
+- Instructing and training of staff
+
+Our specific areas of services include the following:
+
+Client s existing cultivation facilities:
+
+1.
+
+Review of the current cultivation process used by clients. 
+
+2.
+
+Prepare a written recommendation for improvement of harvesting methods that are appropriate for existing facility. Special consideration should be given to the selection of the right seed for plantation conditions, rational harvesting, coffee quality, dissolved and injected fertilization and farm mechanization. After approval of any recommendations by client provide necessarily instructing and training of staff (if required). 
+
+3.
+
+Review of the harvesting methods, processing, packaging and storing of the product.
+
+4.
+
+Review of the pest management, especially of berry borers, nematodes, and leaf rust fungus (Hemileia vastatix Berk. And Br.).
+
+5.
+
+Prepare a written recommendation for improvement of harvesting, processing, packaging and storing of the product.
+
+6.
+
+After the revision of contracts with product distributors prepare a written recommendation regarding marketing strategies, new distributor s networks and logistic solutions.
+
+19 | Page
+
+On-Call service:
+
+1.
+
+Give verbal or written recommendations or instructions via phone, mail or email regarding any client s questions that are not mentioned above, but are related to commercial cultivation and processing of coffee.
+
+Coffee Description 
+
+Coffee is a small perennial tree, 2 to 5 meters high, with opposing branches that are long, flexible and very thin. The coffee plant is a member of the family Rubiaceae, genus Coffea, of which two species are currently grown commercially: Coffea arabica L. and Coffea canephora. Coffea arabica is the most valued species due to its quality, making it the best known and most widely grown in the world.
+
+El Salvadorian coffee varieties: 
+
+1.
+
+BOURBON
+
+ORIGIN: Ethiopia; then to Arabia, Netherlands, France and Martinique, and from there to El Salvador. DESCRIPTION: tall plant, long branches, long internode spacing, open architecture, deep red berries.
+
+GROWING ALTITUDE: from 800-1500 meters.
+
+BEAN SIZE: length 0.95 cm; width 0.70 cm; thickness 0.36 cm.
+
+BOURBON CUP QUALITY EVALUATION: Aroma: penetrating and rich, floral overtones, sweet, chocolate-like. Body: full-bodied with excellent mouthfeel. Acidity: medium to high, good brightness, very well balanced. Flavor: sweet and pleasant, with long persistence and complex chocolate- like attributes.
+
+2.
+
+TEKISIC OR SALVADORAN BOURBON
+
+ORIGIN: The Tekisic cultivar was obtained from the Bourbon variety in El Salvador. Its selection began in 1949 and it was released in 1977. The word Tekisic comes from the Nahuat tekiti, meaning work, and ISIC, Instituto Salvadore o de Investigaciones del Caf (Salvadoran Institute for Coffee Research). Therefore, Tekisic means the work of ISIC.
+
+DESCRIPTION: tall plant, long internode spacing, broad plant architecture, branches that tend to form fans of secondary shoots, light green shoots.
+
+GROWING ALTITUDE: from 800-1500 meters.
+
+BEAN SIZE: length 0.82 cm; width 0.64 cm; thickness 0.35 cm.
+
+3.
+
+PACAS
+
+ORIGIN: Mutation of the Bourbon variety reported in Santa Ana, El Salvador in 1949. 
+
+DESCRIPTION: short plant; long branches; short internode spacing; dark green leaves; well-developed roots; tolerates wind, sun and drought; compact architecture. 
+
+GROWING ALTITUDE: from 600- 1000 meters.
+
+BEAN SIZE: length 0.85 cm; width 0.66 cm; thickness 0.34 cm.
+
+PACAS CUP QUALITY EVALUATION: Aroma: mild with a rich fragrance. Body: medium, with pleasant mouth feel. Acidity: medium, with notable finesse. Flavor: subtle sweetness and lots of finesse.
+
+4.
+
+PACAMARA
+
+ORIGIN: A Coffea arabica hybrid originating in El Salvador in 1958 by artificially crossing Pacas with Red Maragogipe, from where it gets the name Pacamara.
+
+DESCRIPTION: mid-size plant; short internode spacing; large, corrugated, dark green leaves; large berries. 
+
+GROWING ALTITUDE: 1000 meters and higher.
+
+BEAN SIZE: length 1.03 cm; width 0.71; thickness 0.37 cm.
+
+PACAMARA CUP QUALITY EVALUATION: Aroma: pronounced, with floral overtones and complex chocolate-like sweetness. Body: pronounced, full- bodied, excellent mouthfeel. Acidity: high, elegant. Flavor: chocolate-like, very persistent. (*)
+
+20 | Page
+
+History of coffee growing in El Salvador
+
+Since its accidental discovery in Ethiopia thousands of years ago, coffee has become a valuable global commodity, a necessity for millions of people who wake up every morning wanting a great cup of coffee.
+
+The wild Coffea Arabica, discovered in ancient Ethiopia, was taken to Arabia between 575 and 850 by African tribes and the Sufis known as whirling dervishes. There, coffee cultivation became so widespread that a jealously guarded monopoly grew up around it, which protected the shipping ports to ensure that no fertile seed left port undetected. Beans would be roasted or boiled before leaving port so they couldn t germinate.(*)
+
+El Salvador is more than a country where coffee happens to be grown in many ways, it is a country created on coffee, as the crop is heavily woven into El Salvador s history, culture, economy and ecology. 
+
+Coffee has a long history in El Salvador, as the first coffee was believed to have arrived there from the Caribbean as early as 1740. Although coffee was grown in the western part of the country for a long period, production did not rise until 1850s and later. The country shipped its first bags of coffee to Europe
+
+in 1856, and by the 70s, El Salvador was ranked fourth among coffee export countries, harvesting 3.5 million coffee bags.(**)
+
+With such a long history of coffee, it is not surprising that El Salvador knows how to produce a good cup. Coffee flavors range from caramel and chocolate to berries and florals. El Salvador s top quality coffees have been variously described by world-class cuppers as balanced, with vibrant, berry-like, chocolate and floral notes and bright acidity. The coffees are consistent and creamy, with flavors of vanilla and caramel, a good body and a chunky aroma.
+
+The country s climate is well-suited for creating delicious coffees, with its six-month long wet and dry seasons, various mountain ranges and volcanoes, and extensive shade canopy. The majority of coffee is grown on volcanic slopes, which experts believe plays a substantial role in the flavor of the coffee.
+
+Coffee is grown in five geographical areas of the country, which differ from one another mainly in terms of altitude and flavor characteristics:
+
+ Apaneca-Ilamatepec Mountain Range -located in the western region, with altitudes ranging from 1,640 to 6,561 feet.
+
+ Central Belt - comprising the Balsamo Mountain Range and the San Salvador Volcano, with altitudes of 1,540 to 4,920 feet.
+
+ Chinchontepec or San Vicente Volcano - altitudes are 1,640 to 3,280 feet, with the San Vicente Volcano rising to 7,155 feet.
+
+ Cacahuatique Mountain Range - ranges in altitudes from 1,640 to 4,920 feet.
+
+ Tecapa-Chinchontepec Mountain Range - various altitudes, from 1,640 to 4,920 feet and up. The San Miguel or Chaparrastique Volcano is the highest peak with an elevation of 7,017 feet.(***)
+
+Cultivation & Processing
+
+El Salvador produces only arabica coffees, mostly traditional varieties such as bourbon and pacas. Some hybrids including pacamara, caturra, catuai and catisic are also grown, but in very small amounts. It is estimated that there are some 23,000 coffee growers in the country, about 87 percent of which are small farmers, with farms of 19 hectares or less. Many focus on organic and bird-friendly growing procedures. (****)
+
+21 | Page
+
+In addition, most farms are diverse, producing a variety of fruits, vegetables and flowers in addition to coffee.
+
+El Salvador has a strong coffee infrastructure, designed to help producers create the best possible crop. Plantations and mills are near each other; thus, coffee is often hand-picked and de-pulped the same day. Strong sunlight allows the coffee to be patio-dried.
+
+The El Salvadorian coffee harvest runs from October to March. Cherries are hand-picked when they have a deep red-wine color and are processed the same day. Quality is strictly controlled during every step of processing to ensure that the best attribute of El Salvadorian coffee come through in every cup.
+
+El Salvadorian coffee growers recycle the resources extracted when coffee is grown, returning them to the
+
+soil and environment. The pulp is used as organic matter and the hulls are used for fuel during processing. Solid and liquid waste are treated and disposed of properly.
+
+To summarize El Salvador Coffee at a glance:
+
+-
+
+Coffee Arabica: 68 percent bourbon, 29 percent pacas and 3 percent hybrids such as pacamara, caturra and catuai.
+
+-
+
+Flavor: characterized by good body and balanced acidity, an excellent sweetness and rich, penetrating aromas.
+
+-
+
+Main Growing Regions: Apaneca-Ilamatepec Mountain Range, Central Belt, Chichontepec, Cacahuatique Mountain Range, Tecapa- Chichontepec Mountain Range.
+
+-
+
+Elevation: 500 to more than 1,200 meters.
+
+-
+
+Farms: an estimated 23,000 growers, 87 percent of which are small farmers with 19 hectares or less.
+
+-
+
+Flowering: February May
+
+-
+
+Harves: October March
+
+-
+
+Shipping: December August
+
+-
+
+Processing: majority washed and sun-dried
+
+-
+
+Main Buyers: Germany, United States, Belgium, Canada, The Netherlands(*****)
+
+Providers of the consulting services in commercial cultivation and processing of coffee 
+
+We are a new and un-established company, have a weak competitive position in the industry, have generated revenues of $4,870 and have accumulated losses of $2,372 since inception through March 31, 2013. 
+
+We need capital to carry out our current business plan. We anticipate
+
+d
+
+ that we
+
+would
+
+ require a minimum financing of approximately $
+
+38,750
+
+ in order to execute our business plan. As of
+
+June 25
+
+, 2013 we have already incurred and paid $
+
+15,670
+
+ included into $
+
+38,750
+
+ and therefore the estimated minimum capital necessary to fund our planned operations
+
+is
+
+ approximately $
+
+23,080
+
+. We may not have sufficient financing to sustain our current operations. Many of the companies with whom we compete have greater financial and technical resources than those available to us. It is uncertain whether consulting services offered by Vanell, Corp. will achieve and sustain high levels of demand and market acceptance. The development of the markets for the consulting services in commercial cultivation and processing of coffee will be dependent upon larger corporations, domestic companies and service pricing.
+
+Presently in the local El Salvadorian market and in especially in Central America there are some well-structured long standing consulting companies in coffee growing and processing in the marketplace.
+
+Direct competitors include those consulting companies offering services in commercial cultivation and processing of coffee and located throughout El Salvador and Central America. 
+
+Indirect competitors are those coffee consulting companies in El Salvador and Central America that focus on a different target market.
+
+ 
+
+22 | Page
+
+Marketing Our Product
+
+We plan to market our services in El Salvador. Initially, our services will be promoted by our President, Mr. Francisco Douglas Magana. He will discuss our product with his friends and business associates. The marketing and advertising will be targeted to commercial coffee growers in the country, farmers, coffee plantations and mills in El Salvador. We intend to develop and maintain a database of potential clients who may want to use Vanell s services. We will follow up with these clients periodically and offer them free presentations and special discounts from time to time. Our methods of communication will include: phone calls, email, and regular mail. We will ask our satisfied clients for referrals. 
+
+We will market and advertise our product on our web site by showing its advantages over consulting services in coffee growing and processing offered by other companies. We intend to attract traffic to our website by a variety of online marketing tactics such as registering with top search engines using selected key words (meta tags) and utilizing link and banner exchange options. We intend to promote our website by displaying it on our promotion materials. We also plan to attend business shows in our industry to showcase our services with a view to find new customers.
+
+We plan to expand our services to North American market in the future only when or if we have the available resources and growth to warrant it. Currently this option is questionable. 
+
+Revenues
+
+The company s revenues will be what we charge our clients for our consulting services. 
+
+Please note that below numbers are estimated in nature and are meant to show the capacity of the company without hiring additional employees and not a guarantee of future revenues.
+
+Estimated prices for our consulting services are:
+
+-
+
+Initial Meeting with Client - free of charge;
+
+-
+
+Consulting Fee, small commercial coffee growers in El Salvador and Central America - varies depending on length of the project and scope of work involved, starting from USD 85.
+
+-
+
+Consulting Fee, mid-sized commercial coffee growers in El Salvador and Central America - varies depending on length of the project and scope of work involved, starting from USD 100.
+
+Invoicing will be on a monthly basis, beginning after we have completed our first four weeks of service. Vanell, Corp. shall have discretion in selecting the dates and times it performs consulting services throughout the month giving due regard to the needs of the client s business. All actual reasonable and necessary expenditures, which are directly related to the consulting services, are to be reimbursed by the clients.
+
+On November 26, 2012 we signed the service agreement with Finca La Esmeralda, an El Salvador based company specializing in cultivation of coffee. We cannot guarantee that we will be able to find additional successful contracts with the potential customers in need of coffee cultivation consulting services in El Salvador and Central America, in which case our business may fail and we will have to cease our operations.
+
+23 | Page
+
+Competition
+
+Our competitors will include El-Salvadorian companies providing consulting services in commercial cultivation and processing of coffee. We will not be differentiating ourselves from the foregoing, but merely competing with them. The market of consulting services in coffee growing and processing is large and fragmented, and may be difficult to penetrate. Our competitive position within the industry is negligible in light of the fact that we have just started our operations. Older, well-established companies providing similar services with records of success currently attract customers. Since we have just started operations, we cannot compete with them on the basis of reputation. We do expect to compete with them on the basis of the range of coffee consulting services and the quality of consulting services that we intend to provide. There can be no assurance that we can maintain a competitive position against current or future competitors, particularly those with greater financial, marketing, service, technical and other resources. Our failure to maintain a competitive position within the market could have a material adverse effect on our business, financial condition and results of operations. At this time, our principal method of competition will be through personal contact with potential clients.
+
+Agreements
+
+On November 26, 2012 Consulting Service Agreement was signed with Finca La Esmeralda, an El Salvador based company.
+
+The agreement with Finca La Esmeralda contains the following material terms:
+
+2. Term of Agreement/Termination: The term of this Agreement shall be for 12 months beginning from the Effective Date, unless terminated earlier as provided herein. CLIENT may terminate this Agreement for any reason upon twenty (20) days advance written notice to Consultant. Consultant may terminate this Agreement in the event that CLIENT commits a breach of its material obligations hereunder, upon twenty (20) days advance written notice and where CLIENT does not cure the breach.
+
+3. Payment: The CLIENT will pay to Consultant $85.00 per hour for services rendered to the CLIENT under this Agreement. CLIENT should be invoiced for consulting fees in an amount not to exceed $2,500 per month. Invoicing should be on a monthly basis, beginning after the Consultant has completed his first four (4) weeks of service. Under no circumstances shall Consultant perform work having a value (based on the agreed upon per hour rate) in excess of the maximum permitted fee. Consultant shall have discretion in selecting the dates and times it performs consulting services throughout the month giving due regard to the needs of the CLIENT s business. Payment by CLIENT is due within thirty (30) days from receipt of an approved invoice. The CLIENT agrees to reimburse Consultant for all actual reasonable and necessary expenditures, which are directly related to the consulting services. These expenditures include, but are not limited to, expenses related to travel (i.e. airfare, hotel, temporary housing, meals, parking, mileage, etc.), telephone calls, and postal expenditure. Expenses incurred by Consultant will be reimbursed by the CLIENT within 15 days of Consultant s proper written request for reimbursement.
+
+4. Invoices/Reporting: All invoices submitted to CLIENT by Consultant for payment must include a written, task based report detailing the services actually and reasonably provided by Consultant to CLIENT along with the time spent by Consultant performing the same. Consultant shall certify in writing that each such invoice is complete and accurate. Payment is contingent on provision of such invoices. Consultant shall provide technical reports in accordance with the Scope of Work attached as Exhibit A.
+
+Initially, our director Mr. Francisco Douglas Magana will work with the current service agreement. In the future we also expect Mr. Magana to work on potential service agreements with other El-Salvadorian/Central American companies.
+
+We cannot guarantee that we will be able to find additional successful contracts with El-Salvadorian companies, in which case our business may fail and we will have to cease our operations.
+
+On April 1, 2013 we signed the agreement with Spartan Securities, Ltd. to file an application with FINRA for our common stock to become eligible for trading on the Over-the-Counter Bulletin Board. The 211 agreement signed with Spartan Securities, Ltd. has no material terms. Per the 211 contract signed with Spartan Securities, Ltd.: Vanell, Corp. acknowledges that it has not compensated, or agreed to compensate, Spartan, its affiliates, employees, officers and/or directors, or the employees, officers and/or directors of Spartan s affiliates, either directly or indirectly, in consideration of Spartan s agreement to file the Company s Form 211 Listing Application. There are no services, other than the filing of Form 211 application with FINRA, provided or to be provided to us by Spartan.
+
+On April 1, 2013 Transfer Agent Agreement was signed with Island Capital Management, LLC. (dba Island Stock Transfer). Island Stock Transfer is an affiliate company to Spartan Securities, Ltd.
+
+As of June 25, 2013
+
+the compensation paid pursuant to the signed agreement with Island Capital Management, LLC. is $
+
+8,400 and comprised $8,000
+
+for one time Premiere Service Plan fee and $400 for monthly maintenance fees.
+
+ 
+
+We will also incur maintenance fees of $200 per month pursuant to the signed agreement with Island Capital Management in the future.
+
+Among optional services to be offered by Island Capital Management, LLC are printing fees, design fees, DTC fees and search for lost securities holders. Currently, we have no plans to use these services.
+
+The agreement with Island Capital Management, LLC (dba Island Stock Transfer) contains the following material terms:
+
+2.2. Payment: Payment in full of $8,000 (check or charge card) Premier Plan Fee, payable as of the date of this contract, for the Premier Services Plan ( Premier Plan ), which provides for all account set-up services. 
+
+2.2.1 The Company understands Agent s Premier Plan Fees do not include:
+
+ 
+
+2.2.1.1. any fees that are charged by third parties as part of the set-up process such as, printing fees, design fees, DTC fees, and CUSIP fees;
+
+ 
+
+2.2.1.2. charges associated with searching for lost securities holders;
+
+ 
+
+2.2.1.3. any charges for services and costs as defined within Exhibit B, including the monthly maintenance fee which is the greater of $200 or 0.12 per shareholder for the first year.
+
+7. Fees and Payment of Fees.
+
+7.1. The Company agrees to pay Agent the following fees:
+
+7.1.1 A one-time Premier Service Plan fee as specified in Section 2.
+
+7.1.2. A monthly fee to maintain computerized records of the Company in an orderly and accurate manner, and enable Agent to act as the Company s transfer agent or registrar, or both.
+
+7.2. These fees as well as other costs and fees for actions taken by Agent as the transfer agent of company, as described in the Premier Service Plan, which is attached hereto as Exhibit A.
+
+7.3. Agent s fees may be increased in Agent s sole discretion upon (30) days written notice to the Company. Company specifically agrees That Agent shall have a lien against all Company records to secure any amounts owed to Agent. In addition Company specifically agrees that Agent may, at its option, refuse to make any transfers of Company s securities until all past due amounts have been paid in full. The issuer acknowledges that its failure to pay transfer agency services is considered a material event to its shareholders, as it could substantially inhibit the liquidity of their security. The issuer therefore agrees that upon its delinquency of 90 days for failure to pay Island Stock Transfer may, in its sole discretion, notify shareholders of the issuers delinquency. The issuer agrees to hold Island Stock Transfer harmless for such notification.
+
+8. Transfer Agent Expense. The Company agrees to reimburse Agent for any and all expenses resulting from agent being served with subpoena by a Federal or State agency or a request from one of said agencies, requiring or requesting that Agent produce information or documents to said agency. Said expenses include, but are not limited to, travel expenses, copying charges, computer time, employee time and attorney fees for counsel of Agent.
+
+The agreement with Island Capital Management, LLC includes, but is not limited to, the services listed below:
+
+New Client Set-Up:
+
+1.1.
+
+Review and processing of Corporate resolutions to establish Agent as Company s stock transfer and edgarization agent.
+
+1.2.
+
+Receipt and Review of Company s documents, including Articles of Incorporation, Certificate of Incorporation, Amendments to the Articles of Incorporation and Company s resolutions establishing Company s officers.
+
+1.3.
+
+Review, processing, audit and importation of current shareholder information.
+
+1.4.
+
+Formatting and importing records into Agent s shareholder database, including recording stops (Company and SEC issued), restrictions and affiliate/control shareholder statuses.
+
+1.5.
+
+Communication and review with former Company transfer agent.
+
+1.6.
+
+Receipt, verification and organization of former transfer records.
+
+1.7.
+
+New certificate processing, including establishing certificate design, numbers, format and quantity.
+
+1.8.
+
+Storage and retention of previous transfer records, new transfer documents, corporate documents and new certificates.
+
+1.9.
+
+Recording and inventory auditing of records used, unused, lost and destroyed certificates.
+
+1.10.
+
+Communication with, and providing documentation to DTC regarding the transition from previous transfer agent to, or initial establishment of, Island Stock transfer as transfer agent.
+
+Maintenance: 
+
+1.11.
+
+Maintenance of files in secure storage centers, including rated theft locks and fireproof cabinetry. 
+
+1.12.
+
+Maintenance of offsite data backup, ensuring continuous operations in the event of any disaster for the Company or transfer service location.
+
+Custom Reporting:
+
+ 
+
+4.1.
+
+Develop shareholder reports and transaction journals to perform corporate requests.
+
+4.2.
+
+Formatting reports and databases to enable custom reporting.
+
+4.3.
+
+Perform automated functions and maintenance to ensure reports are continuously available.
+
+4.4.
+
+Enable electronic submissions or hardcopy formats of reports.
+
+4.5.
+
+Perform data and transactional searches, including statistical analysis, as required to create custom reports. 
+
+4.6.
+
+Deliver reports as requested by the Company.
+
+Online Services Island Access: 
+
+7.1.
+
+Company set-up for online access and report downloads.
+
+7.2.
+
+Real time report and data updates.
+
+7.3.
+
+Training sessions for Company personnel. 
+
+7.4.
+
+Training sessions for Company shareholders.
+
+7.5.
+
+Administrative maintenance and troubleshooting services.
+
+7.6.
+
+Security control and software maintenance.
+
+Currently, above listed services are the only services to be provided to us by Island Stock Transfer pursuant to the agreement signed on April 1, 2013. 
+
+24 | Page
+
+Description of property 
+
+We do not have an ownership or leasehold interest in any property.
+
+Insurance
+
+We do not maintain any insurance and do not intend to maintain insurance in the future. Because we do not have any insurance, if we are made a party of a products liability action, we may not have sufficient funds to defend the litigation. If that occurs a judgment could be rendered against us that could cause us to cease operations. 
+
+Employees. Identification of Certain Significant Employees
+
+We are a development stage company and currently have no employees, other than our sole officer and director Mr. Francisco Douglas Magana. We intend to hire additional employees on an as needed basis. 
+
+Research and Development Expenditures 
+
+We have not incurred any research or development expenditures since our incorporation. 
+
+Government Regulation
+
+We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the construction and operation of any facility in any jurisdiction which we would conduct activities. We believe that government regulation will have no material impact on the way we conduct our business.
+
+Subsidiaries 
+
+We do not have any subsidiaries.
+
+Patents and Trademarks 
+
+We do not own, either legally or beneficially, any patents or trademarks. 
+
+Offices
+
+Our office is currently located at Res. San Antonio Bk. 10, Pje. 7 N5 San Antonio Del Monte, Sonsonate, El Salvador SV-106090030. Our telephone number is +011-503-79511698. This is the office of our Director, Mr. Francisco Douglas Magana. We do not pay any rent to Mr. Magana and there is no agreement to pay any rent in the future. Upon the completion of our offering, we do not intend to establish an office elsewhere.
+
+Legal Proceedings 
+
+We are not currently a party to any legal proceedings. Our address for service of process in Nevada is 2360 Corporate Circle, Ste. 400 Henderson, Nevada 89074-7722.
+
+25 | Page
+
+Market for Common Equity and Related Stockholder Matters
+
+No Public Market for Common Stock 
+
+There is presently no public market for our common stock. We anticipate applying for trading of our common stock on the over the counter bulletin board upon the effectiveness of the registration statement of which this prospectus forms a part. However, we can provide no assurance that our shares will be traded on the bulletin board or, if traded, that a public market will materialize.
+
+Stockholders of Our Common Shares
+
+As of the date of this registration statement we have 27 registered shareholders. 
+
+Rule 144 Shares 
+
+A total of 3,000,000 shares of our common stock are available for resale to the public in accordance with the volume and trading limitations of Rule 144. Pursuant to Rule 144, a person who has beneficially owned restricted shares of our common stock for at least six months is entitled to sell their securities provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three months preceding the sale and (ii) we are subject to the Securities Exchange Act of 1934 periodic reporting requirements for at least three months before the sale. 
+
+Persons who have beneficially owned restricted shares of our common stock for at least six months but who are our affiliates at the time of, or at any time during the three months preceding the sale, are subject to additional restrictions. Such person is entitled to sell within any three-month period only a number of securities that does not exceed the greater of either of the following: 
+
+ 
+ 
+ 
+
+ 
+
+ 
+
+1% of the total number of securities of the same class then outstanding, which will equal 38,800 shares as of the date of this prospectus; or 
+
+ 
+
+ 
+ 
+ 
+
+ 
+
+ 
+
+the average weekly trading volume of such securities during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale; 
+
+ 
+
+provided, in each case that we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale. 
+
+Such sales must also comply with the manner of sale and notice provisions of Rule 144. 
+
+As of the date of this prospectus, persons who are our affiliates hold all of the 3,000,000 shares that may be sold pursuant to Rule 144. Under Rule 144 the shares of an issuer that is not required to file reports under the Exchange Act can be publicly sold, subject to volume restrictions and restrictions on the manner of sale, commencing one year after their acquisition. 
+
+26 | Page
+
+Stock Option Grants 
+
+To date, we have not granted any stock options. 
+
+Registration Rights 
+
+We have not granted registration rights to the selling shareholders or to any other persons. 
+
+Dividends 
+
+There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend: 
+
+1. 
+
+we would not be able to pay our debts as they become due in the usual course of business; or
+
+ 
+
+ 
+
+2. 
+
+our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of shareholders who have preferential rights superior to those receiving the distribution.
+
+We have not declared any dividends, and we do not plan to declare any dividends in the foreseeable future. 
+
+Plan of Operation
+
+We are a development stage corporation. To date, our business operations have been limited to primarily, the development of a business plan, the completion of private placements for the offer and sale of our common stock, discussing the offer of coffee growing consulting services with potential customers and execution of the service agreement with Finca La Esmeralda, a private El-Salvadorian company. As of
+
+June 25
+
+, 2013 we realized revenues of $
+
+6,870
+
+ from our business operations: $2,400 from inception until December 31, 2012
+
+,
+
+$2,470 on March 15, 2013
+
+ and $2,000 on June 14, 2013
+
+. The revenues were realized based on services performed pursuant to the service agreement signed with Finca La Esmeralda on November 26, 2012.
+
+We are not raising any money in this offering. Our only sources for cash at this time are investments by shareholders in our company, cash advances from our sole director Francisco Douglas Magana and revenues pursuant to the signed agreement.
+
+There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
+
+Our office is currently located at Res. San Antonio Bk 10, Pje 7 N5 San Antonio Del Monte, Sonsonate, El Salvador, SV-106090030. This is the office of our Director, Mr. Francisco Douglas Magana. We do not pay any rent to Mr. Magana and there is no agreement to pay any rent in the future. Upon the completion of our offering, we do not intend to establish an office elsewhere. To service our current contract with Finca La Esmeralda we are relying on equipment from Mr. Magana s business, FDMag S.A. de C.V. We anticipate to rely on Mr. Magana s current business resources until we have available funds to obtain our own equipment and PCs. Currently, this option is highly questionable, as no significant revenues are anticipated until we fully implement our business plan.
+
+We will not be conducting any product research or development. We do not expect to purchase or sell plant or significant equipment. Further we do not expect significant changes in the number of employees. Upon completion of our public offering, our specific goal is to profitably sell our services. 
+
+27 | Page
+
+Following the date of this registration statement, our business plan for the next 12 months is as follows:
+
+February-July, 2013: Negotiate service agreements with potential customers.
+
+Initially, our sole officer and director, Mr. Magana, will look for potential customers. On November 26, 2012, we signed a service agreement with Finca La Esmeralda, a private El-Salvadorian company. During February-May, 2013 we contacted over 20 potential customers in El Salvador through our officer and sole director Francisco Magana s network of friends and business associates in El Salvador. We negotiated terms and conditions of collaboration. As of
+
+June 25
+
+, 2013 Finca La Esmeralda is the only El-Salvadorian company with which we have signed service agreement. We will continue to search for new potential customers during the life of our operations.
+
+Even though the negotiation of additional agreements with customers will be ongoing during the life of our operations, we cannot guarantee that we will be able to find successful agreements, in which case our business may fail and we will have to cease our operations. 
+
+Even if we are able to obtain sufficient number of service agreements at the end of the twelve month period, there is no guarantee that we will be able to attract and more importantly retain enough customers to justify our expenditures. If we are unable to generate a significant amount of revenue and to successfully protect ourselves against those risks, then it would materially affect our financial condition and our business could be harmed.
+
+We are not raising any money in this offering. Our only sources for cash at this time are investments by shareholders in our company, cash advances from our sole director Mr. Francisco Douglas Magana and revenues realized pursuant to the signed agreement. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
+
+July-August, 2013: Commence Marketing Campaign. Estimated cost $7,000.
+
+We intend to use marketing strategies, such as web advertisements, direct mailing, and phone calls to acquire potential customers. We also expect to get new clients from "word of mouth" advertising where our new clients will refer their colleagues to us. 
+
+We also plan to attend shows and exhibitions in commercial coffee growing and processing, which help commercial coffee growers in El Salvador come face to face and find new business opportunities and partners. We intend to spend about $7,000 on marketing efforts during the first year. Marketing is an ongoing matter that will continue during the life of our operations.
+
+August-October, 2013: Develop Website. Estimated Cost $3,000.
+
+By August of 2013 of 2012, assuming available recourses and company growth as planned we intend to begin developing our website. Our director, Mr. Magana will be in charge of registering our web domain. Once we register our web domain, we plan to hire a web designer to help us design and develop our website. We do not have any written agreements with any web designers at current time. The website development costs, including site design and implementation will be approximately $3,000. Updating and improving our website will continue throughout the lifetime of our operations.
+
+28 | Page
+
+October, 2013-February, 2014: Hire Part-Time Coffee Growing and processing Specialist. Estimated Cost $5,000
+
+Initially, our director will look for potential customers in commercial coffee growing industry. We intend to use marketing strategies, such as direct mailing, phone calls and e-mails to potential customers. Once we begin to execute additional service agreements and have funds available for growth we may hire one part-time coffee growing and processing specialist with good knowledge and broad connections to the commercial coffee growing industry. This individual will be an independent contractor compensated solely in the form of commissions, calculated as a percentage of net profits generated from execution of service agreements. 
+
+We therefore expect to incur the following costs in the next 12 months
+
+ (the twelve-month period is being measured from January 30, 2013 - the date when our registration statement was filed)
+
+ in connection with our business operations:
+
+Marketing costs
+
+$ 7,000
+
+Website development costs
+
+ 3,000
+
+Commissions of PT Consulting Specialist
+
+ 5,000
+
+Estimated cost of this offering
+
+ 
+
+16,750
+
+*
+
+Costs associated with being a publicly reporting company
+
+7,000
+
+-
+
+ 
+
+Total
+
+ $
+
+38,750
+
+** 
+
+*$
+
+15,670
+
+0 has already been paid to cover for the offering expenses and comprised $2,500 for the legal fees, $4,750 for the audit fees, $
+
+8,400
+
+ for the transfer agent fees and $20 for the SEC registration fees;
+
+**$
+
+15,670
+
+ is included into $
+
+38,750
+
+. As of
+
+June 25
+
+, 2013 the estimated minimum capital necessary to fund our planned operations will be approximately $
+
+23,080
+
+;
+
+Our current cash reserves are not sufficient to meet our obligations for the next twelve-month period. As a result, we will need to seek additional funding in the near future. We anticipate that additional funding will be from the sale of additional common stock or revenues realized pursuant to the signed agreement with Finca La Esmeralda. We may seek to obtain short-term loans from our director as well, although no such arrangement has been made. 
+
+29 | Page
+
+Limited operating history; need for additional capital 
+
+There is no historical financial information about us upon which to base an evaluation of our performance. We are in start-up stage operations. Since inception through March 31, 2013 the Company has generated revenues of $4,870 and has accumulated losses of $2,372. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products. 
+
+ Our current cash reserves are not sufficient to meet our obligations for the next twelve-month period
+
+ (the twelve-month period is being measured from January 30, 2013 - the date when our registration statement was filed)
+
+. As a result, we will need to seek additional funding in the near future. 
+
+We anticipate that additional funding will be from the sale of additional common stock. We may seek to obtain short-term loans from our director as well, although no such arrangement has been made. At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through a loan from our director to meet our obligations over the next twelve months. We do not have any arrangements in place for any future equity financing. If we are unable to raise the required financing, our operations could be materially adversely affected and we could be forced to cease operations.
+
+Results of Operations for Period Ending March 31, 2013 
+
+Since our inception on September 7, 2012 to March 31, 2013 the company has generated revenues of $4,870 and has accumulated losses of $2,372. Pursuant to the consulting agreement signed with Finca La Esmeralda we recognized our first revenues of $2,400 on December 28, 2012 and $2,470 on March 15, 2013. We incurred operating expenses in the amount of $7,004 for the period from our inception on September 7, 2012 to March 31, 2013. These operating expenses were comprised $ 2,500 for the legal fees, $3,250 for the audit fees, $635 for bank charges and $619 for miscellaneous fees comprised of $274 payable in connection with the incorporation of the company, $20 payable to Securities and Exchange Committee and $325 for filing of the annual list of officers. 
+
+We incurred operating expenses in the amount of $
+
+10,592
+
+ for the period from March 31, 2013 to
+
+June 25
+
+, 2013. These operating expenses were comprised $1,500 for the audit fees, $14 for bank charges, $ 8,
+
+400
+
+ for transfer agent fees, $178 for the federal income tax return for 2012 and $500 for tax preparation fees.
+
+Our operating expenses were $
+
+17,596
+
+ for the period from our inception on September 7, 2012 to
+
+June 25
+
+, 2013. These operating expenses were comprised $ 2,500 for the legal fees, $4,750 for the audit fees, $649 for bank charges and $619 for miscellaneous fees comprised of $274 payable in connection with the incorporation of the company, $20 payable to Securities and Exchange Committee, $325 for filing of the annual list of officers, $
+
+8,400
+
+ for transfer agent fees, $178 for the federal income tax return for 2012 and $500 for tax preparation fees.
+
+As of March 31, 2013 we had cash of $20,340 in our bank accounts. As of
+
+June 25
+
+, 2013 we had cash of $
+
+11,748
+
+ in our bank accounts. However, we expect to incur substantial business operation costs including but not limited to marketing costs, website development costs, commissions of part time specialist, costs of this offering and costs associated with being a publicly reporting company and therefore we anticipate that we will incur substantial losses over the next 12 months. 
+
+We are dependent upon obtaining financing to continue with our business plan. 
+
+Changes In and Disagreements with Accountants 
+
+We have had no changes in or disagreements with our accountants. 
+
+ Available Information
+
+We have filed a registration statement on Form S-1 under the Securities Act of 1933 with the Securities and Exchange Commission with respect to the shares of our common stock offered through this prospectus. This prospectus is filed as a part of that registration statement, but does not contain all of the information contained in the registration statement and exhibits. Statements made in the registration statement are summaries of the material terms of the referenced contracts, agreements or documents of the company. We refer you to our registration statement and each exhibit attached to it for a more detailed description of matters involving the company, and the statements we have made in this prospectus are qualified in their entirety by reference to these additional materials. You may inspect the registration statement, exhibits and schedules filed with the Securities and Exchange Commission at the Commission s principal office in Washington, D.C. Copies of all or any part of the registration statement may be obtained from the Public Reference Section of the Securities and Exchange Commission, 100 F Street NE, Washington, D.C. 20549. D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms.
+
+30 | Page
+
+The Securities and Exchange Commission also maintains a web site at http://www.sec.gov that contains reports, proxy statements and information regarding registrants that file electronically with the Commission. Our registration statement and the referenced exhibits can also be found on this site. 
+
+Reports to Security Holders
+
+Upon effectiveness of this Prospectus, we will be subject to the reporting and other requirements of the Exchange Act. We will make available to our shareholders annual reports containing financial statements audited by our independent auditors and our quarterly reports containing unaudited financial statements for each of the first three quarters of each year; however, we will not send the annual report to our shareholders unless requested by an individual shareholder. 
+
+The public may read and copy any materials that we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that site is www.sec.gov. 
+
+Directors, Executive Officers, Promoters and Control Persons
+
+Our executive officer and director and his age as of the date of this prospectus is as follows: 
+
+Director: 
+
+Name of Director 
+
+ 
+
+Age 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ Francisco Douglas Magana
+
+ 
+
+31
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Executive Officers: 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Name of Officer 
+
+ 
+
+Age 
+
+ 
+
+Office 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ Francisco Douglas Magana
+
+ 
+
+31
+
+ 
+
+President, Chief Executive Officer, Treasurer, Chief Financial Officer and Chief Accounting Officer, Secretary
+
+Biographical Information 
+
+Set forth below is a brief description of the background and business experience of our officers and sole director for the past five years. 
+
+Mr. Magana has acted as our sole President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors since our incorporation on September 7, 2012. Mr. Magana owns 77.32% of the outstanding shares of our common stock. However, Francisco Douglas Magana and Claudia Morales de Magana are husband and wife. Accordingly, each is deemed to be the beneficial owners of their spouse s shares. Therefore the total approximate percentage of shares, including Claudia Morales de Magana s shares, owned by our sole officer and director Mr. Francisco Douglas Magana is 77.84%. 
+
+31 | Page
+
+Mr. Magana graduated with a Bachelor of Science in Agriculture from Universidad de El Salvador (University of El Salvador) in 2004. After graduation Mr. Magana has been working for various coffee plantations and mills in El Salvador (Santa Maria coffee farm from September, 2004 to December, 2005 as a farm supervisor and Coffee Mill Ataspasco from January, 2006 to January, 2007 as a mill supervisor), whose businesses were involved in the cultivation, harvesting methods, processing, packaging, storing and marketing of coffee. In 2007 Mr. Magana opened his own agricultural company FDMag S.A. de C.V. specializing in commercial production of coffee. As of the date of the prospectus Mr. Magana still works for company FDMag S.A. de C.V as a director. His job responsibilities as a director include forecast, plan and implementation of commercial production of coffee with the focus on achieving high standards for plantation cultivation, safety and productivity, and insurance of the sufficient manpower to meet cultivation goals. Since 2009 and until present in addition to production of coffee Mr. Magana has been providing consulting services to coffee growers in El Salvador and Central America. Since 2007 FDMag S.A. de C.V. is the only company Mr. Magana has worked for. Mr. Magana intends to devote close to 40% (25 hours /week) of his time to planning and organizing activities of Vanell, Corp.
+
+Mr. Magana s qualifications to serve on our Board of Directors are primarily based on his nearly five years of experience as a business owner, his business experience and qualifications with FDMag S.A. de C.V., his entrepreneurial desire to start Vanell, Corp. as a new business. Mr. Magana will assist the Company in the prioritization of tasks to accomplish maximum results, timely completion of projects and address organizational problems with innovative solutions. As a Director of FDMag S.A. de C.V, Mr. Magana brings to Vanell, Corp. experience in commercial coffee growing that is at the heart of Vanell s business plan. Mr. Magana has the background and experience to guide us as we develop our business. Due to Mr. Magana s experience and background in the commercial coffee growing industry, the shareholders felt Mr. Francisco Douglas Magana should serve as a director of the company.
+
+During the past ten years, Mr. Magana has not been the subject to any of the following events:
+
+ 1. Any bankruptcy petition filed by or against any business of which Mr. Magana was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.
+
+ 2. Any conviction in a criminal proceeding or being subject to a pending criminal proceeding.
+
+ 3. An order, judgment, or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting Mr. Magana s involvement in any type of business, securities or banking activities.
+
+ 4. Found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Future Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
+
+Significant Employees 
+
+We have no significant employees other than our officers and sole director. 
+
+Audit Committee Financial Expert
+
+We do not have an audit committee financial expert. We do not have an audit committee financial expert because we believe the cost related to retaining a financial expert at this time is prohibitive. Further, because we have no operations, at the present time, we believe the services of a financial expert are not warranted.
+
+Conflicts of Interest 
+
+Mr. Francisco D. Magana, our President will be devoting approximately 40% (25 hours/week) of him time to our operations. Because Mr. Magana will only be devoting limited time to our operations, our operations may be sporadic and occur at times which are convenient to him. As a result, operations may be periodically interrupted or suspended which could result in a lack of significant revenues and a cessation of operations.
+
+32 | Page
+
+Executive Compensation
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001568427_global_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001568427_global_prospectus_summary.txt
new file mode 100644
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--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The Company Our Business The Company was incorporated in the State of Nevada on October 24, 2012 with the name Global Tech Solutions, Inc. We are a development stage company with a principal business selling computer and mobile device software products. The Company plans to develop and market software product as a mobile application for end users of the current generation iPhone 5 and iPad from Apple, Inc. The mobile application s digital content will be customizable by the owner of the particular device using our software. This should be of particular interest to artists and professional photographers and videographers, who want to have their own iPhone 5/iPad applications. We plan to stay on the cutting edge of the constantly changing mobile application market, and our goal is to create a quality reputation within the mobile software community and marketplace. We plan to sell our initial applications through our own online retail website to professionals, who desire their own mobile applications and want to control the content (photos, videos, etc.). We anticipate that we will receive revenue from the sale of our software products. Specifically, customers will be charged an initial fee to download our basic software product. Additional software features will be available for additional charges. Additionally, customers will be charged ongoing monthly fees for continued use of our products, software upgrades and other software modifications. As of the date of this prospectus, neither our initial mobile application nor any other application has been developed to the point that we can describe specifically its nature and scope. As of the date of this prospectus, we have not developed or sold any of our software or other products nor have we generated any revenue from operations. Our operations to date have been devoted primarily to start-up and development activities. Our President, Kenneth Johnson, has performed all of those activities to date, which include the following: Formation of the Company Development of our business plan Development of initial design and structure for mobile applications and desktop applications Research on three major marketing methods/strategies, including small retail stores, major retail outlets, and online sales Formulated product development and marketing strategies for our product lines to include: o iPhone 5 application for professionals in art and music o iPad application for professionals in art and music o iPhone 5 application for professionals in photography and videography o iPad application for professionals in photography and videography Secured web site domain www.global-tech-solutions.net research on mobile application user demographics We will attempt to become completely operational and anticipate sales to begin during the third quarter of operations following the completion of this offering. In order to generate revenues, we must address the following areas: Table of Contents CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered Proposed Maximum Offering Price Per Share (1) Proposed Maximum Aggregate Offering Price Amount of Registration Fee Common Stock par value $0.0001 4,000,000 $0.015 $60,000 $8.18 (1) The offering price has been estimated solely for the purpose of computing the amount of the registration fee in accordance with Rule 457 under the Securities Act of 1933, as amended. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. Table of Contents Finalize and implement our marketing plan: In order to effectively penetrate our targeted market, we will use a multi-faceted and long-term marketing plan that includes a high-end website, targeting professional photographers and videographers, artists, and musicians, and specific distribution channels using independent representatives. Long-term, independent commissioned sales representatives will work as middlemen between us and any potential retailers or websites that wish to offer our products. Their responsibilities would include approaching appropriate retailers, attend trade shows and utilize creative marketing techniques to attract websites and stores to offer our products. Our long term marketing plan is entirely dependent on future financing and, thus, may not occur. We currently, do not have any engagements, agreements, or contracts with independent commissioned sales representatives. Complete our website: we have secured the web domain located at www.global-tech-solutions.net. The site is currently under construction, and we plan to utilize thissite with strategic e-commerce retailers. We have budgeted the necessary funding to develop a quality site. Constantly monitor our market: We plan to constantly monitor our target market and adapt to consumers needs and desires. To be successful, we plan to evolve and diversify our product lines to satisfy the consumer. Operate the Company ethically and responsibly: Conduct our business and ourselves ethically and responsibly. We were incorporated in Nevada on October 24, 2012, as Global Tech Solutions, Inc. Our principal executive offices are located at 80713 Alexandria Court, Indio, California 92201. Our phone number is 714.473.9728. Our fiscal year ends on October 31. As of the date of this prospectus, we have 10,000,000 shares of our $.0001 par value common stock issued and outstanding and held by one shareholder. We are registering for sale 4,000,000 shares of our common stock pursuant to the Securities Act of 1933. Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next 12 months. The financial statements included in the registration statement of which this prospectus is a part do not include any adjustments that might result from the uncertainty about our ability to continue in business. As of April 30, 2013, we had $2,625 in current assets and $21,900 in liabilities. Accordingly, our negative working capital position as April 30, 2013 was $19,275. Currently, we do not have enough cash to finance our operations. We estimate that we need approximately $60,000 to support our operations during the next twelve months. This amount includes (i) $5,000 for costs related to this offering, which have not been paid and (ii) $21,000, which is our estimated cost necessary to comply with our reporting requirements during the next twelve months. We believe the maximum proceeds from this offering will be sufficient to meet our cash requirements for the next twelve months. Our cash shortfall will be $15,000, $30,000 and $45,000, respectively, if we sell 75%, 50% and 25% of the maximum offering. We plan to meet any such shortfall through revenue from operations, private placements of our capital stock, and/or loans from Kenneth Johnson, our sole shareholder; provided, however, we have no commitment from any person for any additional funds. Table of Contents THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE COMPANY MAY NOT SELL ITS SECURITIES UNTIL THE REGISTRATION STATEMENT OF WHICH THIS PROSPECTUS IS A PART AND FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE OF THESE SECURITIES IS NOT PERMITTED. PRELIMINARY PROSPECTUS Dated July 17 , 2013 GLOBAL TECH SOLUTIONS, INC. 4,000,000 Shares of Common Stock $0.015 per share Global Tech Solutions, Inc. ( our , we , us the Company) is offering on a best-efforts basis of as many as 4,000,000 shares of its common stock at a price of $0.015 per share. This is the initial offering of our common stock, and no public market exists for the securities being offered. The Company is offering those shares on a self-underwritten , best-efforts, basis directly by our officer and director. There is no minimum number of shares required to be purchased by any investor. Kenneth Johnson, our sole officer and director, intends to sell those shares directly. No commission or other compensation related to the sale of those shares will be paid to Mr. Johnson or any other person. The intended methods of communication regarding the offer and sale of those shares include, without limitation, telephone and personal contact. Our selling efforts will not include any mass media methods, such as Internet or print media. There can be no assurance that all, or any, of the shares offered will be sold. The offering shall terminate on the earlier of (i) the date when the sale of all 4,000,000 shares is completed or (ii) one hundred and eighty (180) days from the effective date the registration statement of which this prospectus is a part. We are a development stage, start-up company. Any investment in the shares offered herein involves significant risks. You should only purchase shares if you can afford a complete loss of your investment. We may not sell all 4,000,000 shares offered. There is no minimum number of shares we must sell before we can utilize the proceeds from the purchase of shares. If we do not sell all 4,000,000 shares within the offering period (180 days), we will close the offering and subscription funds will not be returned to subscribers. In the event we do not sell all 4,000,000 shares offered, the amount of money we receive from the sale of those shares which are, in fact, purchased be minimal and may not be enough to even pay the costs of this offering. Funds from this offering will be deposited in our corporate bank account in our name. As a result, if we are sued for any reason and a judgment is rendered against us, investors subscriptions could be seized in a garnishment proceeding and investors could lose their investments. Investors do not have the right to withdraw invested funds. For more information, see the sections titled PLAN OF DISTRIBUTION and USE OF PROCEEDS herein. We qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act, which became law in April, 2012 and will be subject to reduced public company reporting requirements. See Jumpstart Our Business Startups Act specified herein. We are considered a shell company under applicable securities rules and subject to additional regulatory requirements as a result, including the inability of our shareholders to sell our shares in reliance on Rule 144 promulgated pursuant to the Securities Act of 1933, as well as additional restrictions. Accordingly, investors should consider our shares to be significantly risky and illiquid investments. Refer to the section entitled RISK FACTORS beginning on Page 5. As of the date of this prospectus, we have not developed or sold any of our software or other products nor have we generated any revenue from operations. BEFORE INVESTING, YOU SHOULD CAREFULLY READ THIS PROSPECTUS AND, PARTICULARLY, THE RISK FACTORS SECTION, BEGINNING ON PAGE 5. NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. Our common stock is not traded on any public market and, although we intend to apply to have the prices of our common stock quoted on the Over-The-Counter Bulletin Board ( OTCBB ) maintained by the Financial Industry Regulatory Authority ( FINRA ) when the registration statement of which this prospectus is a part is declared effective, there can be no assurance that a market marker will agree to file the necessary documents with FINRA to enable us to participate on the OTCBB, nor can there be any assurance that any application filed by any such market maker for quotation on the OTCBB will be approved. Table of Contents Presently, we have no employees. Our sole officer and director is responsible for all planning, development and operational duties and will continue to do so throughout the early stages of our growth. Human resource planning will be a part of an ongoing process that will include regular evaluation of our operations. We intend to hire employees at such time as we determine it is appropriate. We can provide no assurance or guarantee on the date on which we will hire employees. We have no present plans to be acquired by or to merge with another company, nor does our shareholder have plans to enter into a change of control or similar transaction. Jumpstart Our Business Startups Act We are electing to not opt out of JOBS Act of 2012 extended accounting transition period. This may make our financial statements more difficult to compare to other companies. Pursuant to the JOBS Act of 2012, as an emerging growth company, we can elect to opt out of the extended transition period for any new or revised accounting standards that may be issued by the PCAOB or the SEC. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the standard for the private company. This may make comparison of our financial statements with any other public company which is not either an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible, as possible different or revised standards may be used. Emerging Growth Company: The JOBS Act of 2012 is intended to reduce the regulatory burden on emerging growth companies. We meet the definition of an emerging growth company and as long as we qualify as an emerging growth company, we will, among other things: be temporarily exempted from the internal control audit requirements Section 404(b) of the Sarbanes-Oxley Act; be temporarily exempted from various existing and forthcoming executive compensation-related disclosures, for example: say-on-pay , pay-for- performance , and CEO pay ratio ; be temporarily exempted from any rules that might be adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation or supplemental auditor discussion and analysis reporting; be temporarily exempted from having to solicit advisory say-on-pay, say- on-frequency and say-on-golden-parachute shareholder votes regarding executive compensation pursuant to Section 14A of the Securities Exchange Act of 1934, as amended; be permitted to comply with the SEC s detailed executive compensation disclosure requirements on the same basis as a smaller reporting company; and be permitted to adopt any new or revised accounting standards using the same timeframe as private companies (if the standard applies to private companies). We will continue to be an emerging growth company until the earliest of: the last day of the fiscal year during which we have annual total gross revenues of $1 billion or more; Table of Contents TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001569134_tallgrass_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001569134_tallgrass_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001569134_tallgrass_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001572317_uneeqo-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001572317_uneeqo-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..d4564ede9523cdedaaae4f9656d2c033057ed07e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001572317_uneeqo-inc_prospectus_summary.txt
@@ -0,0 +1,127 @@
+Prospectus Summary 4
+
+Risk Factors 7
+
+Use of Proceeds14
+
+Determination of Offering Price 14
+
+Dilution 14
+
+Selling Shareholders 15
+
+Plan of Distribution 17
+
+Legal Proceedings 20
+
+Directors, Executive Officers, Promoters and Control Persons 22
+
+Security Ownership of Certain Beneficial Owners and Management 23
+
+Description of Securities 23
+
+Interest of Named Experts and Counsel 25
+
+Disclosure of Commission Position of Indemnification for Securities Act Liabilities 25
+
+Organization within Last Five Years 26
+
+Description of Business 26
+
+Management's Discussion and Analysis 33
+
+Description of Property 36
+
+Certain Relationships and Related Transactions 34
+
+Market for Common Equity and Related Stockholder Matters 38
+
+Executive Compensation 39
+
+Financial Statements F-2 F-12
+
+Changes In and Disagreements with Accountants on Accounting and Financial Disclosure 41
+
+Prospectus Summary
+
+The following summary is a shortened version of more detailed information, exhibits and financial statements appearing elsewhere in this prospectus. Prospective investors are urged to read this prospectus in its entirety.
+
+We were incorporated on January 6, 2012and are a startup exploration stage company without mining operations and we are in the business of mineral exploration. We have no revenues, have achieved losses since inception, have been issued a going concern opinion by our auditors and rely upon the sale of our securities to fund operations. We have not implemented our business plan to date. In order complete Phase 1, with an estimated cost of $7,784 and Phase II, with an estimated cost of $15,225 of our anticipated exploration program.We will need to raise additional funds, with Phase 1 expected to commence between April 1, 2013 and July 31, 2012. To date we have not commenced our exploration program. Our first years exploration obligation is $7,784 on the CPG Prospect. We are having to raise additional funds of approximately $200,000 commencing immediately, to allow us sufficient time to raise the additional capital and to meet our operations, exploration and contractual obligations through December 31, 2015. There is no assurance that a commercially viable copper and secondary gold,molybdenum and or silver mineral deposit exists on our mining claims. Further exploration will be required before a final evaluation as to the economic and legal feasibility of our mining claims can be determined. Even if we complete our current exploration program and it is successful in identifying a copper,gold and or silver deposit, we will have to spend substantial funds on further drilling and engineering studies before we will know if we have a commercially viable mineral deposit or reserve.
+On December 24, 2012, we entered into a Lease with Option to Purchase Agreement to acquire the CPG Prospect comprising of one claim block of 13 claims or 260 acres, with an additional 31 claims available for the price of $7,000 respectively.The claimscanbe accessed via Hawthorne, Nevada about 29 miles via a county gravel and then turning west on an unimproved dirt road for about 4 miles. The property can also be reached from Fallon, Nevada by traveling east on U.S. Highway 50 for about 35 miles, then south on State Route 839 about 19 miles to the end of the pavement and then south along the gravel county road 11 miles to the turn to the dirt access road. The gravel road is in good repair and previously served as an alternate route to Kennecott s Denton-Rawhide Mine. Rail service is available at Hawthorne and Fallon. The nearest commercial airport is at Reno, approximately 110 road miles from the property.The CPG Prospect agreement was entered into for the initial sum of $17,000, comprised of a $10,000 down payment and $7,000for the staking, filing and recording of an additional 31 claims.Costs and subsequent additional payments and exploration expenditures representing an aggregate total of $172,000 in payments and $272,500 in exploration expenditures over a period of five years as outlined in our Lease with Option to Purchase Agreement ( See Exhibit 10.1) to exercise the optionto purchase a 100% interest in the property. There is a 3% royalty interest attached to the claims in favor of Claremont Nevada Mines, LLC.and the claims are registered in the name of Claremont Nevada Mines, LLC.with the State of Nevada. There is no electrical power that can be utilized on the claim other than electrical power that can be provided by gas or diesel generators that we would bring on site.
+Young Ju Yi and Woo Jong Yoo, our directors and officershave not visited the property yet, and have had no previous experience in mineral exploration or operating a mining company. 
+
+4
+
+Our directors own 54.55% of our outstanding common stock. Since our directors own a majority of our outstanding shares and they are the sole directors and officers of our company they have the ability to elect directors and control the future course of our company. Investors may find that the corporate decisions influenced by our directors are inconsistent with the interests of other stockholders.
+
+Our objective is to conduct exploration activities on our mining claims to assess whether the claim possess any commercially viable mineral deposits.
+
+Until we can validate otherwise, the claims are without known reserves and we are planning a four phase program to explore our claims. 
+
+The claims are not accessible all year round, there are periods where our claims may be un-accessible each year due to snow in the area. This means that our exploration activities may be limited to a period of about eight to nine months per year. We plan commence exploration on our claims in April 2013 or May 2013 and our goal is to complete the first phase of exploration before July 31, 2013, and is contingent upon availability of an exploration crew.
+
+The following table summarizes the four phases of our anticipated exploration program.
+
+Phase Number
+
+Planned Exploration Activities
+
+Time table
+
+Phase 1
+
+Preliminary Surface Sampling, Geological and Geochemical Screening. 
+
+Estimated Cost: $7,784
+
+Between April 1, 2013 and December 31, 2013
+
+Phase II
+
+Detailed Evaluation, Geological Mapping, Site Prep, additional sampling
+
+Estimated Cost:$15,225
+
+Between January 1, 2014 and December 31, 2014
+
+Phase III
+
+Permitting and site preparation: drilling and environmental reclamation
+
+Estimated Cost:$51,939
+
+January 1, 2015 and December 31, 2015
+
+If our exploration activities indicate that there are no commercially viable mineral deposits on our mining claims we will abandon the claims and stake or acquire new claims to explore. We will continue to stake and explore claims as long as we can afford to do so.
+
+To date we have raised $56,000 via two offerings. The following table summarizes the date of offering, the price per share paid, the number of shares sold and the amount raised for the offering.
+
+Closing Date of Offering
+
+Price Per Share Paid
+
+Number of Shares Sold
+
+Amount Raised
+
+December 31, 2012
+
+$0.001
+
+6,000,000
+
+$6,000
+
+December 31, 2012
+
+$0.01
+
+5,000,000
+
+$50,000
+
+5
+
+We have no revenues, have achieved losses since inception, have no operations, have been issued a going concern opinion by our auditors and rely upon the sale of our securities to fund operations.
+
+Name, Address, and Telephone Number of Registrant
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001573029_broadview_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001573029_broadview_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..efc3a56bdef422ea7f2ebe4caa72341889d8888e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001573029_broadview_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read the entire prospectus carefully together with our consolidated financial statements and the related notes appearing elsewhere in this prospectus. This prospectus contains forward-looking statements, which involve risks and uncertainties. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those discussed in the Risk Factors and other sections of this prospectus. Company Overview We are a leading cloud-based service provider of communications and information technology solutions to small and medium sized business ( SMB ) and enterprise customers nationwide. After several years of development, we began providing cloud-based communication services in 2005 and later introduced into our product portfolio a variety of cloud-based computing solutions. Today, we offer a full suite of cloud-based systems and services to customers nationwide, with more than 100,000 active licenses on our flagship product offering, our cloud-based business communications platform named OfficeSuite , which comprises a growing percentage of our overall revenue and the vast majority of our existing cloud-based revenue stream. We benefit from software development expertise, proprietary technology and a strong next-generation network infrastructure. This allows us to offer our customers more than just cloud-based services, but additionally products that include advanced, converged communications services and network access by leveraging our network infrastructure, on a cost-effective basis. For the three months ended March 31, 2013, over 82% of all new revenue installed during the period was provisioned on our next-generation IP network. We have provided cloud-based services in the Northeast and Mid-Atlantic United States since 2005 and offered cloud-based services nationwide since late 2009. Prior to 2009, our focus had been solely on markets across 10 states, including the major metropolitan markets of New York, Boston, Philadelphia, Baltimore and Washington, D.C. These markets remain important markets for us and we have the majority of our direct sales efforts focused on these markets. We distribute our products through quota-bearing sales representatives, including a direct sales force primarily based in the Northeast and Mid-Atlantic United States, sales agents nationwide, and by our expanded efforts in wholesale, web marketing, Value Added Resellers ( VARs ) and nationwide distributor channels. As of March 31, 2013, we provided our services to approximately 30,000 business customers nationwide. For the three months ended March 31, 2013 and the year ended December 31, 2012, approximately 90% and 89%, respectively, of our total revenue was generated from retail end users in a wide array of industries, including professional services, health care, education, manufacturing, real estate, retail, automotive, non-profit groups and others. For the same periods, approximately 10% and 11%, respectively, of our total revenue was generated from wholesale, carrier access and other sources. We have transitioned a significant percentage of our revenue base to T-1- and IP-based products and cloud-based communications services. For the three months ended March 31, 2013 and the year ended December 31, 2012, revenue from these accounts represented 78% and 76%, respectively, of our retail revenue with cloud-based communications services generating 18% and 16%, respectively, of retail revenue. From the first quarter of 2009 to the first quarter of 2013, cloud-based communications products and services have grown at approximately a 27% compound annual growth rate ( CAGR ). For the three months ended March 31, 2013 and the year ended December 31, 2012, we generated total revenues of $80.8 million and $340.9 million, respectively, and Adjusted EBITDA of $11.7 million and $60.2 million, respectively. For more information, see the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations Adjusted EBITDA Presentation. Our product portfolio provides bundled packages that include cloud computing and cloud-based voice services and network connectivity with a focus on addressing the productivity, flexibility, security and business continuity needs of end users operating within complex infrastructures. In addition, our growth initiatives focus Table of Contents TABLE OF CONTENTS Page SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 1 PROSPECTUS SUMMARY 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001573032_broadview_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001573032_broadview_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..efc3a56bdef422ea7f2ebe4caa72341889d8888e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001573032_broadview_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read the entire prospectus carefully together with our consolidated financial statements and the related notes appearing elsewhere in this prospectus. This prospectus contains forward-looking statements, which involve risks and uncertainties. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those discussed in the Risk Factors and other sections of this prospectus. Company Overview We are a leading cloud-based service provider of communications and information technology solutions to small and medium sized business ( SMB ) and enterprise customers nationwide. After several years of development, we began providing cloud-based communication services in 2005 and later introduced into our product portfolio a variety of cloud-based computing solutions. Today, we offer a full suite of cloud-based systems and services to customers nationwide, with more than 100,000 active licenses on our flagship product offering, our cloud-based business communications platform named OfficeSuite , which comprises a growing percentage of our overall revenue and the vast majority of our existing cloud-based revenue stream. We benefit from software development expertise, proprietary technology and a strong next-generation network infrastructure. This allows us to offer our customers more than just cloud-based services, but additionally products that include advanced, converged communications services and network access by leveraging our network infrastructure, on a cost-effective basis. For the three months ended March 31, 2013, over 82% of all new revenue installed during the period was provisioned on our next-generation IP network. We have provided cloud-based services in the Northeast and Mid-Atlantic United States since 2005 and offered cloud-based services nationwide since late 2009. Prior to 2009, our focus had been solely on markets across 10 states, including the major metropolitan markets of New York, Boston, Philadelphia, Baltimore and Washington, D.C. These markets remain important markets for us and we have the majority of our direct sales efforts focused on these markets. We distribute our products through quota-bearing sales representatives, including a direct sales force primarily based in the Northeast and Mid-Atlantic United States, sales agents nationwide, and by our expanded efforts in wholesale, web marketing, Value Added Resellers ( VARs ) and nationwide distributor channels. As of March 31, 2013, we provided our services to approximately 30,000 business customers nationwide. For the three months ended March 31, 2013 and the year ended December 31, 2012, approximately 90% and 89%, respectively, of our total revenue was generated from retail end users in a wide array of industries, including professional services, health care, education, manufacturing, real estate, retail, automotive, non-profit groups and others. For the same periods, approximately 10% and 11%, respectively, of our total revenue was generated from wholesale, carrier access and other sources. We have transitioned a significant percentage of our revenue base to T-1- and IP-based products and cloud-based communications services. For the three months ended March 31, 2013 and the year ended December 31, 2012, revenue from these accounts represented 78% and 76%, respectively, of our retail revenue with cloud-based communications services generating 18% and 16%, respectively, of retail revenue. From the first quarter of 2009 to the first quarter of 2013, cloud-based communications products and services have grown at approximately a 27% compound annual growth rate ( CAGR ). For the three months ended March 31, 2013 and the year ended December 31, 2012, we generated total revenues of $80.8 million and $340.9 million, respectively, and Adjusted EBITDA of $11.7 million and $60.2 million, respectively. For more information, see the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations Adjusted EBITDA Presentation. Our product portfolio provides bundled packages that include cloud computing and cloud-based voice services and network connectivity with a focus on addressing the productivity, flexibility, security and business continuity needs of end users operating within complex infrastructures. In addition, our growth initiatives focus Table of Contents TABLE OF CONTENTS Page SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 1 PROSPECTUS SUMMARY 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001573051_trucom_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001573051_trucom_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..efc3a56bdef422ea7f2ebe4caa72341889d8888e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001573051_trucom_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read the entire prospectus carefully together with our consolidated financial statements and the related notes appearing elsewhere in this prospectus. This prospectus contains forward-looking statements, which involve risks and uncertainties. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those discussed in the Risk Factors and other sections of this prospectus. Company Overview We are a leading cloud-based service provider of communications and information technology solutions to small and medium sized business ( SMB ) and enterprise customers nationwide. After several years of development, we began providing cloud-based communication services in 2005 and later introduced into our product portfolio a variety of cloud-based computing solutions. Today, we offer a full suite of cloud-based systems and services to customers nationwide, with more than 100,000 active licenses on our flagship product offering, our cloud-based business communications platform named OfficeSuite , which comprises a growing percentage of our overall revenue and the vast majority of our existing cloud-based revenue stream. We benefit from software development expertise, proprietary technology and a strong next-generation network infrastructure. This allows us to offer our customers more than just cloud-based services, but additionally products that include advanced, converged communications services and network access by leveraging our network infrastructure, on a cost-effective basis. For the three months ended March 31, 2013, over 82% of all new revenue installed during the period was provisioned on our next-generation IP network. We have provided cloud-based services in the Northeast and Mid-Atlantic United States since 2005 and offered cloud-based services nationwide since late 2009. Prior to 2009, our focus had been solely on markets across 10 states, including the major metropolitan markets of New York, Boston, Philadelphia, Baltimore and Washington, D.C. These markets remain important markets for us and we have the majority of our direct sales efforts focused on these markets. We distribute our products through quota-bearing sales representatives, including a direct sales force primarily based in the Northeast and Mid-Atlantic United States, sales agents nationwide, and by our expanded efforts in wholesale, web marketing, Value Added Resellers ( VARs ) and nationwide distributor channels. As of March 31, 2013, we provided our services to approximately 30,000 business customers nationwide. For the three months ended March 31, 2013 and the year ended December 31, 2012, approximately 90% and 89%, respectively, of our total revenue was generated from retail end users in a wide array of industries, including professional services, health care, education, manufacturing, real estate, retail, automotive, non-profit groups and others. For the same periods, approximately 10% and 11%, respectively, of our total revenue was generated from wholesale, carrier access and other sources. We have transitioned a significant percentage of our revenue base to T-1- and IP-based products and cloud-based communications services. For the three months ended March 31, 2013 and the year ended December 31, 2012, revenue from these accounts represented 78% and 76%, respectively, of our retail revenue with cloud-based communications services generating 18% and 16%, respectively, of retail revenue. From the first quarter of 2009 to the first quarter of 2013, cloud-based communications products and services have grown at approximately a 27% compound annual growth rate ( CAGR ). For the three months ended March 31, 2013 and the year ended December 31, 2012, we generated total revenues of $80.8 million and $340.9 million, respectively, and Adjusted EBITDA of $11.7 million and $60.2 million, respectively. For more information, see the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations Adjusted EBITDA Presentation. Our product portfolio provides bundled packages that include cloud computing and cloud-based voice services and network connectivity with a focus on addressing the productivity, flexibility, security and business continuity needs of end users operating within complex infrastructures. In addition, our growth initiatives focus Table of Contents TABLE OF CONTENTS Page SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 1 PROSPECTUS SUMMARY 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001573067_a-r-c_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001573067_a-r-c_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..efc3a56bdef422ea7f2ebe4caa72341889d8888e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001573067_a-r-c_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read the entire prospectus carefully together with our consolidated financial statements and the related notes appearing elsewhere in this prospectus. This prospectus contains forward-looking statements, which involve risks and uncertainties. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those discussed in the Risk Factors and other sections of this prospectus. Company Overview We are a leading cloud-based service provider of communications and information technology solutions to small and medium sized business ( SMB ) and enterprise customers nationwide. After several years of development, we began providing cloud-based communication services in 2005 and later introduced into our product portfolio a variety of cloud-based computing solutions. Today, we offer a full suite of cloud-based systems and services to customers nationwide, with more than 100,000 active licenses on our flagship product offering, our cloud-based business communications platform named OfficeSuite , which comprises a growing percentage of our overall revenue and the vast majority of our existing cloud-based revenue stream. We benefit from software development expertise, proprietary technology and a strong next-generation network infrastructure. This allows us to offer our customers more than just cloud-based services, but additionally products that include advanced, converged communications services and network access by leveraging our network infrastructure, on a cost-effective basis. For the three months ended March 31, 2013, over 82% of all new revenue installed during the period was provisioned on our next-generation IP network. We have provided cloud-based services in the Northeast and Mid-Atlantic United States since 2005 and offered cloud-based services nationwide since late 2009. Prior to 2009, our focus had been solely on markets across 10 states, including the major metropolitan markets of New York, Boston, Philadelphia, Baltimore and Washington, D.C. These markets remain important markets for us and we have the majority of our direct sales efforts focused on these markets. We distribute our products through quota-bearing sales representatives, including a direct sales force primarily based in the Northeast and Mid-Atlantic United States, sales agents nationwide, and by our expanded efforts in wholesale, web marketing, Value Added Resellers ( VARs ) and nationwide distributor channels. As of March 31, 2013, we provided our services to approximately 30,000 business customers nationwide. For the three months ended March 31, 2013 and the year ended December 31, 2012, approximately 90% and 89%, respectively, of our total revenue was generated from retail end users in a wide array of industries, including professional services, health care, education, manufacturing, real estate, retail, automotive, non-profit groups and others. For the same periods, approximately 10% and 11%, respectively, of our total revenue was generated from wholesale, carrier access and other sources. We have transitioned a significant percentage of our revenue base to T-1- and IP-based products and cloud-based communications services. For the three months ended March 31, 2013 and the year ended December 31, 2012, revenue from these accounts represented 78% and 76%, respectively, of our retail revenue with cloud-based communications services generating 18% and 16%, respectively, of retail revenue. From the first quarter of 2009 to the first quarter of 2013, cloud-based communications products and services have grown at approximately a 27% compound annual growth rate ( CAGR ). For the three months ended March 31, 2013 and the year ended December 31, 2012, we generated total revenues of $80.8 million and $340.9 million, respectively, and Adjusted EBITDA of $11.7 million and $60.2 million, respectively. For more information, see the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations Adjusted EBITDA Presentation. Our product portfolio provides bundled packages that include cloud computing and cloud-based voice services and network connectivity with a focus on addressing the productivity, flexibility, security and business continuity needs of end users operating within complex infrastructures. In addition, our growth initiatives focus Table of Contents TABLE OF CONTENTS Page SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 1 PROSPECTUS SUMMARY 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001574786_np-green_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001574786_np-green_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001574786_np-green_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001574808_sc-sp-1_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001574808_sc-sp-1_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001574808_sc-sp-1_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001574810_sc-sp-3_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001574810_sc-sp-3_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001574810_sc-sp-3_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001574826_np_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001574826_np_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001574826_np_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001574830_np-town_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001574830_np-town_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001574830_np-town_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001574833_sc-butte_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001574833_sc-butte_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001574833_sc-butte_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001574835_sc-madera_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001574835_sc-madera_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001574835_sc-madera_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001577902_blutek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001577902_blutek_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..ec37062a312f4f63a759104684b93b87bd7a009b
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001577902_blutek_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY Blutek Innovations, Corp. Blutek Innovations Corp. ( we , us , our or the Company ) was organized under the laws of the State of Nevada on October 23, 2012, to develop fuel conservation technologies and solutions. Our address and telephone number is: Rm 1004, Crawford House, 70 Queen s Road Central, Central, Hong Kong: 602-466-3666. Blutek Innovations Corp. is a Hong Kong based company that develops, engineers, and markets advanced fuel saving products for worldwide distribution which provide immediate solutions addressing fuel economy, dependency on foreign oil and promotes a healthier environment. Our clean technology fuel saving products are designed to provide practical and affordable solutions today to reduce vehicle fuel consumption, fuel expense, and lower harmful emissions. Current government initiatives and mandates require significant increases in vehicle fuel economy and the reduction of harmful emissions. This has created an opportunity for Blutek Innovations Corp. Corp. Vehicles powered by electricity, solar energy, alternative fuels and other technologies are currently being developed and improved. However, purchasing new vehicles or making the necessary changes to utilize many of these advanced technologies, especially for large fleets, can be costly. Our products are designed to be retrofitted to existing vehicles and avoid the expense of purchasing new vehicles. We are a development stage company and we have not realized any revenues to date. Our initial capitalization consists of $300,000. We believe this gives us sufficient capital to implement our business plan for the next six (6) months. Thereafter, we will need to raise additional capital to commence full implementation of our business plan. We are not a "blank check company," as we do not intend to participate in a reverse acquisition or merger transaction. Securities laws define a blank check company as a development stage company that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person. Our offices are located at Rm 1004, Crawford House, 70 Queen s Road Central, Central, Hong Kong.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001580121_daric-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001580121_daric-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..3933bdf39fdd4daedc6abea3a02890e6ca1c9e50
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001580121_daric-inc_prospectus_summary.txt
@@ -0,0 +1,847 @@
+Prospectus Summary
+
+This summary highlights information contained elsewhere in this prospectus. You should read the following summary together with the more detailed information appearing in this prospectus, including our financial statements and related notes, and the risk factors beginning on page 11, before deciding whether to purchase our Member Payment Dependent Notes.
+
+Overview
+
+Daric is a pre-launch Internet-based peer to peer lending platform that enables its borrower members to borrow money and its lender members to purchase Member Payment Dependent Notes, the proceeds of which fund specific loans made to individual borrower members. We operate in the space known as peer to peer lending. 
+
+About the Loan Platform
+
+Through our online platform, we allow qualified borrower members to obtain unsecured loans with lower interest rates than they could through credit cards or traditional banks. We also provide our lender members with the opportunity to indirectly fund specific member loans with credit characteristics, interest rates and other terms the lender members find attractive by purchasing Notes that in turn are dependent for payment on the payments we receive from those borrower member loans. As a part of operating our lending platform, we verify the identity of members, obtain real-time borrower members credit profiles from consumer reporting agencies such as TransUnion, Experian or Equifax and CreditAPI, and screen borrower members for eligibility to participate in the platform. We also service the member loans on an ongoing basis. See About the Loan Platform. 
+
+The Notes. Our lender members will have the opportunity to buy Notes issued by Daric. Lender members will be able to designate the particular member loan that they want the proceeds of each Note they purchase to be used to fund. The holders of Notes of each series will have the right to receive their pro rata portion of principal and interest payments on their Note but only if, and to the extent, that we receive loan payments on the corresponding member loan, net of our service charge.
+
+The Notes will be special, limited obligations of Daric only and not obligations of any borrower member. The Notes are unsecured and holders of the Notes do not have a security interest in the corresponding member loans or the proceeds of those corresponding member loans.
+
+Daric is obligated to pay principal and interest on each Note in a series only if and to the extent that Daric receives payments from the borrower member on the corresponding member loan funded by the proceeds of that series, and such borrower member payments will be shared ratably among all Notes of the series after deduction of Daric s service charge and any unsuccessful payment fees, collection fees or payments due to Daric on account of the portion of the corresponding member loan, if any, funded by Daric in its capacity as a lender on the platform. If Daric were to become subject to a bankruptcy or similar proceeding, the holder of a Note may have a general unsecured claim against Daric that is not limited in recovery to such borrower payments, but, as described in more detail below, the matter is not free from doubt. See Risk Factors If we were to become subject to a bankruptcy or similar proceeding. 
+
+The Member Loans. All member loans are unsecured obligations of individual borrower members with a fixed interest rate and three-year maturity. Each member loan is originated through our website and funded by WebBank at closing. WebBank is an FDIC-insured, Utah-chartered industrial bank that serves as the lender for all member loans originated through our platform. Immediately upon closing of a member loan, WebBank assigns the member loan to Daric without recourse to WebBank in exchange for the aggregate purchase price we have received from lender members who have committed to purchase the Notes dependent on payments to be received on such member loan plus any amounts of the member loan that we have determined to fund ourselves. WebBank has no obligation to purchasers of the Notes. See About the Loan Platform How the Daric Platform Operates Purchasers of Notes and Loan Closings. 
+
+About Daric
+
+We were incorporated in Delaware in April 2011 under the name Daric Corporation. Our principal executive offices are located at 234 Marshall Street, Redwood City, CA, and our telephone number is (650) 218-4287. Our website address is www.daric.com. We plan to launch with an operational lending platform that will become effective as of the date of this prospectus.
+
+ 
+
+The Offering
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+Issuer
+
+ 
+Daric Corporation.
+
+ 
+
+Notes offered
+
+ 
+Member Payment Dependent Notes, issued in series, with each series of Notes related to one corresponding member loan.
+
+ 
+
+Offering price
+
+ 
+100% of principal amount of each Note.
+
+ 
+
+Initial maturity date
+
+ 
+Three years, four business days following issuance.
+
+ 
+
+Final maturity date
+
+ 
+120 days after the initial maturity date.
+
+ 
+
+Extension election
+
+ 
+Each Note will mature on the initial maturity date, unless any principal or interest payments in respect of the corresponding member loan remain due and payable to Daric upon the initial maturity date and the holder of the Note elects to extend the maturity of the Note to the final maturity date.
+
+ 
+
+Interest rate
+
+ 
+Each series of Notes will have a stated interest rate, which is the interest rate for the corresponding member loan.
+
+ 
+
+Payments on the Notes
+
+ 
+We will pay you principal and interest on any Note you purchase in an amount equal to your pro rata portion of the loan payments, if any, we receive on the corresponding member loan, net of our 1.00% service charge. We will also pay you any other amounts we receive on the Notes, including late fees and prepayments, subject to our 1.00% service charge, except that we will retain all unsuccessful payment fees, collection fees we or our third-party collection agency charge and any payments due to Daric on account of portions of the corresponding member loan, if any, funded by Daric in its capacity as a lender on the platform. We will make any payments on the Notes within four business days after we receive the payments from borrower members on the corresponding member loan. The Notes are not subject to any credit enhancement. See About the Loan Platform Description of the Notes for more information.
+
+ 
+
+Corresponding member loans to consumer borrowers
+
+ 
+The proceeds from the sale of each series of Notes will be designated by the lender members who purchased the Notes of that series to fund a corresponding member loan originated through our platform to an individual consumer who is one of our borrower members. Each member loan originated through our platform is a three-year, fully amortizing consumer loan made by WebBank to an individual Daric borrower member. WebBank subsequently assigns the member loan to Daric without recourse to WebBank in exchange for the aggregate purchase price Daric has received from lender members who have committed to purchase Notes that are dependent on payments to be received on such corresponding member loan. Member loans have fixed interest rates that currently range between 6.00% and 25.00%. Member loans are repayable in monthly installments and are unsecured and unsubordinated. Member loans may be repaid at any time by our borrower members without prepayment penalty. In the case of a partial prepayment of a member loan, we automatically recalculate the amortization schedule over the remainder of the member loan s three-year term, and the borrower member s monthly payment on the loan is correspondingly reduced. See About the Loan Platform for more information.
+
+ 
+ 
+ 
+
+Ranking
+
+ 
+The Notes will not be contractually senior or contractually subordinated to any other indebtedness of Daric. The Notes will be unsecured special, limited obligations of Daric. Daric will be obligated to pay principal and interest on each Note in a series only if and to the extent that Daric receives payments from the borrower member on the corresponding member loan funded by the proceeds of that series, and such borrower member loan payments will be shared ratably among all Notes of the series after deduction of Daric s service charge and any unsuccessful payment fees, collection fees or payments due to Daric on account of the portions of the member loan, if any, funded by Daric in its capacity as a lender on the platform. In the event of a bankruptcy or similar proceeding of Daric, the relative rights of the holder of a Note as compared to the holders of other unsecured indebtedness of Daric with respect to payment from the proceeds of the consumer loan corresponding to that Note or other assets of Daric may be uncertain. If Daric were to become subject to a bankruptcy or similar proceeding, the holder of a Note may have a general unsecured claim against Daric that is not limited in recovery to such borrower member loan payments, as described in more detail below. For a more detailed description of the possible implications if Daric were to become subject to a bankruptcy or similar proceeding, see Risk Factors If we were to become subject to a bankruptcy or similar proceeding. 
+
+ 
+
+ 
+ 
+The Notes do not restrict Daric s incurrence of other indebtedness or the grant or imposition of liens or security interests on the assets of Daric, including on the member loans corresponding to the Notes. To the extent that liens or security interests have been or are granted or imposed on assets of Daric, including on the member loans corresponding to the Notes, the Notes will rank effectively junior to the rights of the holders of such liens and security interests with respect to the assets encumbered by such liens and security interests.
+
+ 
+
+Service charge
+
+ 
+Prior to paying a holder of a Note any payments on the Note, we will deduct a service charge equal to 1.00% of any such payment amounts. See About the Loan Platform How the Daric Platform Operates Post-Closing Loan Servicing and Collection for more information.
+
+ 
+
+Use of proceeds
+
+ 
+We will use the proceeds of each series of Notes to fund the corresponding member loan through our platform. See About the Loan Platform for more information.
+
+ 
+ 
+ 
+
+Electronic form and transferability
+
+ 
+The Notes will be issued in electronic form only and will not be listed on any securities exchange. The Notes will not be transferable unless and until we are able to establish a resale platform for Notes. Although we are working to establish a resale platform, there can be no assurance we will be able to do so, or, if we are able to do so, when a resale platform would be available. Therefore, lender members must be prepared to hold their Notes to maturity. See About the Loan Platform Description of the Notes for more information.
+
+ 
+
+U.S. federal income tax consequences
+
+ 
+Although the matter is not free from doubt, Daric intends to treat the Notes as indebtedness of Daric for U.S. federal income tax purposes. As a result of such treatment, the Notes will have original issue discount, or OID, for U.S. federal income tax purposes because payments on the Notes are dependent on payments on the corresponding member loan. Further, a holder of a Note will be required to include the OID in income as ordinary interest income for U.S. federal income tax purposes as it accrues (which may be in advance of interest being paid on the Note), regardless of such holder s regular method of accounting. Prospective purchasers of the Notes should consult their own tax advisors regarding the U.S. federal, state, local and non-U.S. tax consequences of the purchase and ownership of the Notes, including any possible differing treatments of the Notes. See About the Loan Platform Certain U.S. Federal Income Tax Considerations for more information.
+
+Questions and Answers
+
+Q:
+
+ 
+Who is Daric?
+
+ 
+
+A:
+
+ 
+Daric is an Internet-based peer to peer lending platform.
+
+ 
+
+Q:
+
+ 
+What is the Daric platform?
+
+ 
+
+A:
+
+ 
+Our platform allows qualified borrower members to obtain unsecured loans with lower interest rates than they could through credit cards or traditional banks. Our platform also provides our lender members with the opportunity to invest in notes that are dependent on borrower member loans with credit characteristics, interest rates and other terms the lender members find attractive. As a part of operating our lending platform, we verify the identity of members, obtain borrower members credit profiles from consumer reporting agencies, such as TransUnion, Experian or Equifax and screen borrower members for eligibility to participate in the platform. We also service the member loans on an ongoing basis.
+
+ 
+
+Q:
+
+ 
+What are our Member Payment Dependent Notes?
+
+ 
+
+A:
+
+ 
+Our lender members may buy Member Payment Dependent Notes issued by Daric. In this prospectus, we refer to our Member Payment Dependent Notes as the Notes. The proceeds of each series of Notes will be designated by the lender members who purchase the Notes of the series to fund a corresponding member loan originated through our platform to an individual consumer who is one of our borrower members. Each series of Notes will have a stated interest rate, which is the interest rate for the corresponding member loan. The principal and interest payments, if any, you will receive on any Note you purchase will be limited to an amount equal to your pro rata portion of the loan payments, if any, we receive on the corresponding member loan, net of our 1.00% service charge, any unsuccessful payment fees, collection fees and any payments due to Daric on account of portions of the corresponding member loan, if any, funded by Daric in its capacity as a lender on the platform. The service charge will reduce the effective yield on your Notes below their stated interest rate. The Notes are special, limited obligations of Daric only and not the borrower members. The Notes will be unsecured and do not represent an ownership interest in the corresponding member loans.
+
+ 
+
+Q:
+
+ 
+Who are our lender members?
+
+ 
+
+A:
+
+ 
+Our lender members are individuals and organizations that have the opportunity to buy our Notes. Lender members must register on our website. During lender registration, potential lender members must agree to a credit profile authorization statement for identification purposes and a tax withholding statement, and must enter into a note purchase agreement with Daric, which will govern all purchases of Notes the lender member makes.
+
+ 
+
+Q:
+
+ 
+What are the member loans?
+
+ 
+
+A:
+
+ 
+The member loans are unsecured obligations of individual borrower members with a fixed interest rate and three-year maturity. Each member loan is originated through our website, funded by WebBank at closing, and immediately assigned to Daric upon closing in exchange for the aggregate purchase price we have received from lender members who have committed to purchase the Notes dependent on payments to be received on such member loan. A member loan will be issued to a borrower member if the loan has received full funding commitments, or if the borrower chooses to accept partial funding of the loan after receiving partial funding commitments.
+
+ 
+
+Q:
+
+ 
+Do member lenders loan funds directly to borrower members?
+
+ 
+
+A:
+
+ 
+No. Lender members do not make loans directly to our borrower members. Instead, lender members purchase Notes issued by Daric, the proceeds of which are designated by the lender members who purchased the Notes for a loan to an individual borrower member originated through the Daric platform.
+
+ 
+
+Q:
+
+ 
+What member loan amounts are available to borrowers on our platform?
+
+ 
+
+A:
+
+ 
+Currently, borrowers may request member loans in amounts ranging from $1,000 to $35,000. We plan to launch by issuing borrower loans in California, New York, Florida, Texas, and Illinois. 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+Q:
+
+ 
+Who are our borrower members?
+
+ 
+
+A:
+
+ 
+Daric borrower members are individual consumers who have registered on our platform. All Daric borrower members:
+
+ 
+
+ 
+ 
+ must be U.S. residents;
+
+ 
+
+ 
+ 
+ must be at least 18 years old;
+
+ 
+
+ 
+ 
+ must have valid email accounts;
+
+ 
+
+ 
+ 
+ must satisfy our credit criteria (as described below);
+
+ 
+
+ 
+ 
+ must have a U.S. social security number; and
+
+ 
+
+ 
+ 
+ must have an account at a financial institution with a routing transit number.
+
+ 
+
+Q:
+
+ 
+Does Daric participate in the platform as a lender?
+
+ 
+
+A:
+
+ 
+From time to time, Daric may participate in the Daric platform as a lender. For example, during the time when our site was not open to new lender member commitments, borrower members could still apply for loans, which were funded and held only by Daric. Although we have no obligation to do so, we may fund portions of loan requests in the future.
+
+ 
+
+Q:
+
+ 
+How does Daric verify a borrower member s identity?
+
+ 
+
+A:
+
+ 
+During borrower registration, we verify the identity of members by comparing supplied names, social security numbers, addresses and telephone numbers against the names, social security numbers, addresses and telephone numbers in the records of a consumer reporting agency, as well as other anti-fraud and identity verification databases. We also currently require each new borrower member to supply information about the member s bank account.
+
+ 
+
+Q:
+
+ 
+What are the minimum credit criteria for borrower members?
+
+ 
+
+A:
+
+ 
+After we receive a loan request from a borrower member, we evaluate whether the prospective borrower member meets our credit criteria. Our borrower member credit criteria are designed to be consistent with WebBank s loan underwriting requirements and require prospective borrower members to have:
+
+ 
+
+ 
+ 
+ a minimum FICO score of 660 (as reported by a consumer reporting agency);
+
+ 
+
+ 
+ 
+ a debt-to-income ratio (excluding mortgage) below 30%, as calculated by Daric based on (i) the borrower member s debt reported by a consumer reporting agency; and (ii) the income reported by the borrower member, which we verify in approximately 25% of cases; and
+
+ 
+
+ 
+ 
+ a credit profile (as reported by a consumer reporting agency) without any current delinquencies, recent bankruptcy, collections or open tax liens.
+
+ 
+
+Q:
+
+ 
+What are Daric loan grades?
+
+ 
+
+A:
+
+ 
+For borrower members that qualify, we assign one of 35 loan grades, from A1 through G5, to each loan request, based on the borrower member s FICO score, debt-to-income ratio (calculated as described above) and requested loan amount. A higher credit score, lower debt-to-income ratio and lower requested loan amount are factors that lead to a loan request being more likely to be designated grade A1. See About the Loan Platform How the Daric Platform Operates Interest Rates for more information.
+
+ 
+
+Q:
+
+ 
+How do we set interest rates on member loans?
+
+ 
+
+A:
+
+ 
+Our interest rate working group sets the interest rates applicable to our loan grades. After a loan request s loan grade has been determined, we assign an interest rate to the loan request. Interest rates currently range between 6.00% and 25.00%. We set the interests rates we assign to borrower loan grades in three steps. First, we determine Daric base rates. Second, we determine an assumed default rate that attempts to project loan default rates. Third, we use the assumed default rate to calculate an upward adjustment to the base rates, which we call the Risk-based Rate Adjustment. See About the Loan Platform How the Daric Platform Operates Interest Rates.
+
+ 
+
+Q:
+
+ 
+Will Daric make payments on a Note if the corresponding member loan for the Note defaults?
+
+ 
+
+A:
+
+ 
+No. If the member loan corresponding to your Note defaults and the borrower member does not pay Daric, Daric will not be obligated to make payments on your Note, and you will not receive any payments on your Note. We have no obligation to make any payments of principal or interest on a Note unless, and then only to the extent that, we receive payments in respect of the corresponding member loan, and after deduction of Daric s service charge and any unsuccessful payment fees, collection fees or payments due to Daric on account of the portion of the member loan, if any, funded by Daric in its capacity as a lender on the platform. For an explanation of a possible bankruptcy exception to the limited nature of the obligations on the Notes, see Risk Factors If we were to become subject to a bankruptcy or similar proceeding. 
+
+ 
+
+Q:
+
+ 
+Are the Notes secured by any collateral?
+
+ 
+
+A:
+
+ 
+No. The Notes are not secured by any collateral, including the corresponding member loans, and are not guaranteed or insured by any governmental agency or instrumentality or any third party. The Notes are not subject to any credit enhancement.
+
+ 
+
+Q:
+
+ 
+How do lenders members receive payments on the Notes?
+
+ 
+
+A:
+
+ 
+All payments on the Notes are processed through the Daric platform. If and when we make a payment on your Notes, the payment will be deposited in your Daric account. You may elect to have available balances in your Daric account transferred to your bank account at any time, subject to normal execution times for such transfers.
+
+ 
+
+Q:
+
+ 
+Can lender members collect on late payments themselves?
+
+ 
+
+A:
+
+ 
+No. Lender members must depend on Daric or our third-party collection agents to pursue collection on delinquent member loans. If collection action must be taken in respect of a member loan, we or the collection agency will charge a collection fee of between 7% and 30% of any amounts that are obtained. These fees will correspondingly reduce the amounts of any payments you receive on the Notes.
+
+ 
+
+Q:
+
+ 
+What happens if a borrower member repays a member loan early?
+
+ 
+
+A:
+
+ 
+We allow borrower members to make extra payments on, or prepay, their member loans in part or entirely at any time without penalty. In the event of a prepayment of the entire remaining unpaid principal amount of a member loan on which your Notes are dependent, you will receive your share of such prepayment, net of our service charge, and interest will stop accruing after the date on which such prepayment is received by us. If a borrower member partially prepays a member loan, we will pay you your share of the prepayment amount we receive, net of our service charge, and we will make available to you a revised schedule of anticipated payments reflecting the lower outstanding principal balance and lower monthly payments of the corresponding member loan.
+
+ 
+
+Q:
+
+ 
+How does Daric make money from the platform?
+
+ 
+
+A:
+
+ 
+We earn revenue from the fees we charge our borrower members and lender members. We charge borrower members origination fees, which currently range from 0.75% to 3.00%. We charge lender members a service charge of 1.00% of all amounts paid by Daric to lender members with respect to each Note. To a lesser extent, we earn interest on member loans to the extent that we fund those member loans ourselves.
+
+ 
+
+Q:
+
+ 
+How are the Notes being offered?
+
+ 
+
+A:
+
+ 
+We are offering the Notes directly to our lender members only through our website for a purchase price of 100% of the principal amount of the Notes. We are not using any underwriters, and there will be no underwriting discounts.
+
+ 
+
+ 
+ 
+
+Q:
+
+ 
+Will I receive a certificate for my Notes?
+
+ 
+
+A:
+
+ 
+No. The Notes are issued only in electronic form. This means that each Note will be stored on our website. You can view your Notes online and print copies for your records, by visiting your secure, password-protected webpage in the My Account section of our website.
+
+ 
+
+Q:
+
+ 
+How are the Notes treated for United States federal income tax purposes?
+
+ 
+
+A:
+
+ 
+Although the matter is not free from doubt, Daric intends to treat the Notes as indebtedness of Daric for U.S. federal income tax purposes. As a result of such treatment, the Notes will have original issue discount, or OID, for U.S. federal income tax purposes because payments on the Notes are dependent on payments on the corresponding member loan. Further, a holder of a Note will be required to include the OID in income as ordinary interest income for U.S. federal income tax purposes as it accrues (which may be in advance of interest being paid on the Note), regardless of such holder s regular method of accounting. Prospective purchasers of the Notes should consult their own tax advisors regarding the U.S. federal, state, local and non-U.S. tax consequences of the purchase and ownership of the Notes, including any possible differing treatments of the Notes. See About the Loan Platform Certain U.S. Federal Income Tax Considerations. 
+
+ 
+
+Q:
+
+ 
+Will the Notes be listed on an exchange?
+
+ 
+
+A:
+
+ 
+No. The Notes will not be listed on any securities exchange.
+
+ 
+
+Q:
+
+ 
+Will I be able to sell my Notes?
+
+ 
+
+A:
+
+ 
+The Notes will not be transferable unless and until we are able to establish a resale platform for Notes. Although we are working to establish a resale platform, there can be no assurance we will be able to do so, or, if we are able to do so, when a resale platform would be available. Therefore, lender members must be prepared to hold their Notes to maturity.
+
+ 
+
+Q:
+
+ 
+Are there any risks associated with an investment in Notes?
+
+ 
+
+A:
+
+ 
+Yes. The Notes are risky and speculative. Please see Risk Factors. 
+
+ 
+
+ 
+ 
+
+Risk Factors
+
+Our Notes involve a high degree of risk. In deciding whether to purchase Notes, you should carefully consider the following risk factors. Any of the following risks could have a material adverse effect on the value of the Notes you purchase and could cause you to lose all or part of your initial purchase price or future principal and interest payments you expect to receive.
+
+RISKS RELATING TO THE NOTES AND THE CORRESPONDING MEMBER LOANS ON WHICH THE NOTES ARE DEPENDENT
+
+You may lose some or all of your initial purchase price for the Notes because the Notes are risky and speculative. Only lender members who can bear the loss of their entire purchase price should purchase our Notes.
+
+The Notes are risky and speculative because payments on the Notes depend entirely on payments to Daric of unsecured consumer finance obligations of individual borrowers and contemporaneous payments on the Notes, which are special, limited obligations of Daric. Notes are suitable purchases only for lender members of adequate financial means. If you cannot afford to lose all of the money you plan to invest in Notes, you should not purchase Notes. You should not assume that a Note is appropriate for you just because it corresponds to a loan listed on the Daric platform or is presented as a choice by Portfolio Builder.
+
+Payments on the Notes depend entirely on payments we receive in respect of corresponding member loans. If a borrower member fails to make any payments on the corresponding member loan related to your Note, you will not receive any payments on your Note.
+
+We will only make payments on the Notes after we receive borrower members payments on corresponding member loans, net of our service charge and any unsuccessful payment fees, collection fees or payments due to Daric on account of portions of the corresponding member loan, if any, funded by Daric in its capacity as a lender on the platform. If we do not receive payments on the corresponding member loan related to your Note, you will not be entitled to any payments under the terms of the Notes, and you will not receive any payments. The failure of a borrower member to repay a loan is not an event of default under the terms of the Notes.
+
+The Notes are special, limited obligations of Daric only and are not secured by any collateral or guaranteed or insured by any third party.
+
+The Notes will not represent an obligation of borrower members or any other party except Daric, and are special, limited obligations of Daric. The Notes are not secured by any collateral and are not guaranteed or insured by any governmental agency or instrumentality or any third party.
+
+Member loans are not secured by any collateral or guaranteed or insured by any third party, and you must rely on Daric and our designated third-party collection agency to pursue collection against any borrower member.
+
+Member loans are unsecured obligations of borrower members. They are not secured by any collateral, not guaranteed by any third party, not insured by any third party and not backed by any governmental authority in any way. Daric and its designated third-party collection agency will therefore be limited in their ability to collect member loans.
+
+Moreover, member loans are obligations of borrower members to Daric, not obligations to holders of Notes. Holders of Notes will have no recourse to borrower members and no ability to pursue borrower members to collect payments under member loans. Holders of Notes may look only to Daric for payment of the Notes, and Daric s obligation to pay the Notes is limited as described in this prospectus. See About the Platform Description of the Notes. 
+
+ 
+
+Borrower member credit information may be inaccurate or may not accurately reflect the borrower member s creditworthiness, which may cause you to lose part or all of the purchase price you pay for a Note.
+
+Daric obtains borrower member credit information from consumer reporting agencies, such as TransUnion, Experian or Equifax, and assigns loan requests one of 35 Daric loan grades, from A1 through G5 based on the reported credit score and other information reported by the consumer reporting agencies, self-reported borrower information and other metrics. See About the Loan Platform How the Daric Platform Operates Minimum Credit Criteria and Underwriting. A credit score or loan grade assigned to a borrower member may not reflect that borrower member s actual creditworthiness because the credit score may be based on outdated, incomplete or inaccurate data, and Daric does not verify the information obtained from the borrower member s credit report. Additionally, there is a risk that, following the date of the credit report that Daric obtains and reviews, a borrower member may have: become delinquent in the payment of an outstanding obligation; defaulted on a pre-existing debt obligation; taken on additional personal debt; or sustained other adverse financial events.
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+Moreover, lender members do not, and will not, have access to financial statements of borrower members, or to other detailed financial information about borrower members.
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+Information supplied by borrower members may be inaccurate.
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+Borrower members supply a variety of unverified information that is included in the borrower member loan listings on our website. We do not verify this information, and it may be inaccurate. For example, we do not verify a borrower member s stated social affiliations (such as educational affiliations), home ownership status, job title, employer or tenure, and the information borrower members supply may be inaccurate. Borrower members may misrepresent their intentions for the use of loan proceeds. Unless we have indicated otherwise in a loan listing, we do not verify a borrower member s stated income. For example, unlike most traditional banks, we do not verify borrower member paystubs, IRS Forms W-2, federal or state income tax returns, bank and savings account balances, retirement account balances, letters from employers, home ownership or rental records, car ownership records or any records related to past bankruptcy and legal proceedings. The identity of borrower members is not revealed to lender members, and lender members also have no ability to obtain or verify borrower member information. Potential lender members may only communicate with borrower members through Daric website postings, and then only on an anonymous and unverified basis. If you rely on misleading or unverified information supplied by borrower members in deciding to purchase Notes, you may lose part or all of the purchase price you pay for a Note. Consequently, lender members should not rely on unverified information provided by borrower members.
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+While we take precautions to prevent borrower member fraud, it is possible that fraud may occur and adversely affect your ability to receive the principal and interest payments that you expect to receive on those Notes.
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+We use identity and fraud checks with a third-party provider to verify each borrower member s identity and credit history, as described in more detail in About the Loan Platform How the Daric Platform Operates New Member Registration. Notwithstanding our efforts, there is a risk that fraud may occur and remain undetected by us. While we will repurchase Notes in limited identity fraud circumstances involving the corresponding member loan, we are not otherwise obligated to repurchase a Note from you for any other reason. If Daric repurchases a Note based on identity fraud involving the corresponding member loan, you will only receive an amount equal to the outstanding principal balance of the Note. See About the Loan Platform How the Daric Platform Operates Identity Fraud Reimbursement. 
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+ 
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+Significant historical performance data about expected borrower member performance on Daric member loans is derived from publicly available statistics for the major peer-to-peer lending sites today. Default rates on the member loans may increase.
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+We are in the early stages of our development and our operating history will commence only upon launch. We have calculated significant historical performance data regarding borrower member performance on the member loans from publicly available data sets from existing peer-to-peer lending companies. The estimated default rates we use in calculating interest rates have not been developed from Daric loss histories but rather from existing peer-to-peer lending loss histories. Member loans originated through the Daric platform may default more often than these estimated default rates. As loan loss experience increases on the Daric platform, we may change how interest rates are set, and lender members who have purchased Notes prior to any such changes will not benefit from these changes.
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+Default rates on the member loans may increase as a result of economic conditions beyond our control and beyond the control of borrower members.
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+Member loan default rates may be significantly affected by economic downturns or general economic conditions beyond our control and beyond the control of individual borrower members. In particular, default rates on member loans on which the Notes are dependent may increase due to factors such as prevailing interest rates, the rate of unemployment, the level of consumer confidence, residential real estate values, the value of the U.S. dollar, energy prices, changes in consumer spending, the number of personal bankruptcies and other factors.
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+If payments on the corresponding member loans relating to your Notes become more than 30 days overdue, it is likely you will not receive the full principal and interest payments that you expect to receive on your Notes due to collection fees, and you may not recover any of your original purchase price.
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+If the borrower member fails to make a required payment on a member loan within 30 days of the due date, Daric will pursue reasonable collection efforts in respect of the member loan. Referral of a delinquent member loan to a collection agency on the 31st day of its delinquency will be considered reasonable collection efforts. If we refer a loan to a collection agency, we will have no other obligation to attempt to collect on delinquent loans. We, or an outside collection agency acting on our behalf, will receive a percentage of any funds recovered after 31 days delinquency from a borrower member as a service fee before any principal or interest becomes payable to you from recovered amounts in respect of Notes related to the corresponding member loan. Collection fees range from 7% to 30% of recovered amounts.
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+Daric or the collection agency may not be able to recover some or all of the unpaid balance of a non-performing member loan, and a lender member who has purchased a Note dependent on the non-performing member loan will receive nothing or a small fraction of the unpaid principal and interest of the Note. You must rely on the collection efforts of Daric and the designated collection agency, and you are not permitted to attempt to collect payments on the member loans in any manner.
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+The member loans on which the Notes are dependent do not restrict borrower members from incurring additional unsecured or secured debt, nor do they require the borrower member s debt-to-income ratio to remain fixed during the term of the member loan, which may impair your ability to receive the full principal and interest payments that you expect to receive on a Note.
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+If a borrower member incurs additional debt after obtaining a member loan through the Daric platform, the additional debt may impair the ability of that borrower member to make payments on the borrower s member loan and your ability to receive the principal and interest payments that you expect to receive on Notes dependent on those loans. In addition, the additional debt may adversely affect the borrower member s creditworthiness generally, and could result in the financial distress, insolvency, or bankruptcy of the borrower member. To the extent that the borrower member has or incurs other indebtedness and cannot pay all of its indebtedness, the borrower member may choose to make payments to creditors other than Daric.
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+The member loans are unsecured credit obligations of individual borrower members. To the extent borrower members incur other indebtedness that is secured, such as mortgage, home equity or auto loans, the ability of the secured creditors to exercise remedies against the assets of the borrower member may impair the borrower member s ability to repay the member loan on which your Note is dependent. Borrower members may also choose to repay obligations under secured indebtedness before repaying member loans originated through the Daric platform because the borrower members have no collateral at risk in the case of the member loans. A lender member will not be made aware of any additional debt incurred by a borrower member, or whether such debt is secured.
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+The member loans do not contain any cross-default or similar provisions. If borrower members default on their debt obligations other than on the member loans, the ability to collect on member loans on which your Notes are dependent may be substantially impaired.
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+The member loans do not contain cross-default provisions. A cross-default provision makes a default under certain debt of a borrower member an automatic default on other debt of that borrower member. Because the member loans do not contain cross-default provisions, a borrower member s loan will not be placed automatically in default upon that borrower member s default on any of the borrower member s other debt obligations, unless there are independent grounds for a default on the member loan. The member loans will not be referred to a third-party collection agency for collection because of a borrower member s default on debt obligations other than the member loans. If a borrower member defaults on debt obligations owed to a third party and continues to satisfy payment obligations under the member loans, the third party may seize the borrower s assets or pursue other legal action against the borrower member before the borrower member defaults on the member loans. Payments on Notes may be substantially reduced if the borrower member subsequently defaults on the member loans, and you may be unable to recoup any or all of your expected principal and interest payments on those Notes.
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+Borrower members may seek the protection of debtor relief under federal bankruptcy or state insolvency laws, which may result in the nonpayment of your Notes.
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+Borrower members may seek protection under federal bankruptcy law or similar laws. If a borrower member files for bankruptcy (or becomes the subject of an involuntary petition), a stay will go into effect that may automatically put any pending collection actions on hold and prevent further collection action absent bankruptcy court approval. If we receive notice that a borrower member has filed for protection under the federal bankruptcy laws, or has become the subject of an involuntary bankruptcy petition, we will put the borrower member s loan account into bankruptcy status. When we put a member loan into bankruptcy status, we cease making automatic monthly payments and do not undertake collection activity without bankruptcy court approval. Whether any payment will ultimately be made or received on a member loan after a bankruptcy status is declared depends on the borrower member s particular financial situation. It is possible that the borrower member s personal liability on the member loan will be discharged in bankruptcy. In most cases involving the bankruptcy of a borrower member, unsecured creditors, including Daric as holder of the member loans, will receive only a fraction of any amount outstanding on their member loans, if anything. See About the Loan Platform How the Daric Platform Operates Post-Closing Loan Servicing and Collection. 
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+Federal law entitles borrower members who enter active military service to an interest rate cap and certain other rights that may inhibit the ability to collect on loans and reduce the amount of interest paid on the corresponding Notes.
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+Federal law provides borrower members on active military service with rights that may delay or impair our ability to collect on a borrower member loan corresponding to your Note. The Servicemembers Civil Relief Act requires that the interest rate on preexisting debts, such as member loans, be set at no more than 6% while the qualified servicemember or reservist is on active duty. A holder of a Note that is dependent on such a member loan will not receive the difference between 6% and the original stated interest rate for the member loan during any such period. This law also permits courts to stay proceedings and execution of judgments against servicemembers and reservists on active duty, which may delay recovery on any member loans in default, and, accordingly, payments on Notes that are dependent on these member loans.
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+The death of a borrower member may substantially impair your ability to recoup the full purchase price of Notes that are dependent on the member loans to that borrower member or to receive the interest payments that you expect to receive on the Notes.
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+All borrower members are individuals. If a borrower member with outstanding obligations under a member loan dies while the member loan is outstanding, generally, we will seek to work with the executor of the estate of the borrower member to obtain repayment of the member loan. However, the borrower member s estate may not contain sufficient assets to repay the member loan on which your Note is dependent. In addition, if a borrower member dies near the end of the term of a member loan, it is unlikely that any further payments will be made on the Notes corresponding to such member loan, because the time required for the probate of the estate may extend beyond the initial maturity date and the final maturity date of the Notes.
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+The Daric platform allows a borrower member to prepay a member loan at any time without penalty. Borrower member loan prepayments will extinguish or limit your ability to receive additional interest payments on a Note.
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+Borrower member loan prepayment occurs when a borrower member decides to pay some or all of the principal amount on a member loan earlier than originally scheduled. A borrower member may decide to prepay all or a portion of the remaining principal amount at any time without penalty. In the event of a prepayment of the entire remaining unpaid principal amount of a member loan on which your Notes are dependent, you will receive your share of such prepayment but further interest will not accrue after the date on which the payment is made. If a borrower member prepays a portion of the remaining unpaid principal balance on a member loan on which your Notes are dependent, the term of the member loan will not change, but interest will cease to accrue on the prepaid portion and future monthly payment amounts, including interest amounts, will be reduced. If a borrower member prepays a member loan in full or in part, you will not receive all of the interest payments that you originally expected to receive on Notes that are dependent on that member loan, and you may not be able to find a similar rate of return on another investment at the time at which the member loan is prepaid. See About the Loan Platform Description of the Notes Prepayments. 
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+Prevailing interest rates may change during the terms of the member loans on which your Notes are dependent. If this occurs, you may receive less value from your purchase of the Notes in comparison to other ways you may invest your money. Additionally, borrower members may prepay their member loans due to changes in interest rates, and you may not be able to redeploy the amounts you receive from prepayments in a way that offers you the return you expected to receive from the Notes.
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+The member loans on which the Notes are dependent have a term of three years and bear fixed, not floating, rates of interest. If prevailing interest rates increase, the interest rates on Notes you purchase might be less than the rate of return you could earn if you invested your purchase price in a different investment.
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+While you may still receive a return on your purchase price for the Notes through the receipt of amounts equal to the interest portion of a borrower member s payments on the member loan, if prevailing interest rates exceed the rate of interest payable on the member loan, the payments you receive during the term of the Note may not reflect the full opportunity cost to you when you take into account factors such as the time value of money.
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+There is no prepayment penalty for borrower members who prepay their member loans. If prevailing interest rates on consumer loans decrease, borrower members may choose to prepay their member loans with money they borrow from other sources or other resources, and you may not receive the interest payments on Notes dependent on those member loans that you expect to receive or be able to find an alternative use of your money to realize a similar rate of return at the time at which the Note is prepaid.
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+If you do not diversify your Note purchases by buying Notes dependent on the member loans of multiple borrower members, you will increase your risk of losses on the Notes.
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+Member loans originated through the Daric platform have a wide range of credit grades, and we expect that some borrower members will default on their member loans. If you decide to invest an amount of money in our Notes and have selected the credit grades of loans corresponding to Notes that you wish to invest in, it will be desirable to use the amount of money you have chosen to invest to purchase Notes dependent on member loans of a number of different borrower members. Failing to diversify your investment increases the risk of losing your entire investment due to a single borrower member s default, or a small number of borrower member defaults. Diversification, however, will not eliminate the risk that you may lose some, or all, of the expected principal and interest payments on your Notes.
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+The interest rate on lender member funds placed in a Daric lender member account is less than the interest rate on member loans on which the Notes are dependent.
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+Your Daric lender member account represents an interest in a pooled bank account. The interest earned on funds, if any, placed in your Daric account, either pending investment in a Note or following receipt of payment on a Note, will be substantially lower than the stated interest rate on the Notes. For a description of Daric member accounts, see About the Loan Platform How the Daric Platform Operates Loan Funding and Treatment of Lender Member Balances. 
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+The Notes will not be listed on any securities exchange, are not presently transferable and must be held only by Daric lender members. You should expect to hold the Notes you purchase until they mature.
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+The Notes will not be listed on any securities exchange. Also, until such time as we are able to establish a resale platform, the Notes are not transferable. All Notes must be held by Daric lender members, and currently there is no resale platform for Notes. Unless and until we develop a resale platform, lender members should expect to hold their Notes to maturity. See About the Loan Platform Description of the Notes Restrictions on Transfer for more information about transferability and the development of a resale platform.
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+The U.S. federal income tax consequences of an investment in the Notes is uncertain.
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+No authority directly addresses the treatment of the Notes or instruments similar to the Notes for U.S. federal income tax purposes. Although the matter is not free from doubt, Daric intends to treat the Notes as indebtedness of Daric for U.S. federal income tax purposes. As a result of such treatment, the Notes will have original issue discount, or OID, for U.S. federal income tax purposes because payments on the Notes are dependent on payments on the corresponding member loan. Further, a holder of a Note will be required to include the OID in income as ordinary interest income for U.S. federal income tax purposes as it accrues (which may be in advance of interest being paid on the Note), regardless of such holder s regular method of accounting. This characterization is not binding on the IRS, and the IRS may take contrary positions. Any differing treatment of the Notes could significantly affect the amount, timing and character of income, gain or loss in respect of an investment in the Notes. Accordingly, all prospective purchasers of the Notes are advised to consult their own tax advisors regarding the U.S. federal, state, local and non-U.S. tax consequences of the purchase and ownership of the Notes (including any possible differing treatments of the Notes). For a discussion of the U.S. federal income tax consequences of an investment in the Notes, see About the Loan Platform Certain U.S. Federal Income Tax Considerations. 
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+RISKS RELATED TO Daric AND THE Daric PLATFORM
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+We have a limited operating history. As an online company in the early stages of development, we face increased risks, uncertainties, expenses and difficulties.
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+If we are successful, the number of borrower members and lender members and the volume of member loans originated through the Daric platform will increase, which will require us to increase our facilities, personnel and infrastructure in order to accommodate the greater servicing obligations and demands on the Daric platform. The Daric platform is dependent upon our website in order to maintain current listings and transactions in the member loans and Notes. We must constantly add new hardware and update our software and website, expand our customer support services and add new employees to maintain the operations of the Daric platform, as well as to satisfy our servicing obligations on the member loans and make payments on the Notes. If we are unable to launch successfully and increase the capacity of the Daric platform and maintain the necessary infrastructure, you may experience delays in receipt of payments on your Notes and periodic downtime of our systems.
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+If we are unable to increase transaction volumes, our business and results of operations will be affected adversely.
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+To succeed, we must increase transaction volumes on the Daric platform by attracting a large number of borrower members and lender members in a cost-effective manner, many of whom have not previously participated in peer to peer lending. We have experienced a high number of inquiries from potential borrower members who do not meet our criteria for submitting a member loan request. We may experience a larger number of borrower member funding requests than lender member purchase commitments, and our ability to obtain funds to help address this shortfall may be subject to broader developments in the credit markets. If we are not able to attract qualified borrower members and sufficient lender member purchase commitments, we will not be able to increase our transaction volumes. Additionally, we rely on a variety of methods to drive traffic to our website. If we are unable to use any of our current or future marketing initiatives or the cost of these initiatives were to significantly increase, we may not be able to attract new members in a cost-effective manner and, as a result, our revenue and results of operations would be affected adversely, which may impair our ability to maintain the Daric platform.
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+We will need to raise substantial additional capital to fund our operations, and if we fail to obtain additional funding, we may be unable to continue operations.
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+At this early stage in our development, we have funded substantially all of our operations with proceeds from angel investor capital financings and private placements. In order to continue the development of the Daric platform, we will require substantial additional funds. To meet our financing requirements in the future and post-launch, we may need to raise funds through equity offerings, debt financings or strategic alliances. Raising additional funds may involve agreements or covenants that restrict our business activities and options. Additional funding may not be available to us on favorable terms, or at all.
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+The market in which we participate is competitive and, if we do not compete effectively, our operating results could be harmed.
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+The consumer lending market is competitive and rapidly changing. With the introduction of new technologies and the influx of new entrants, we expect competition to persist and intensify in the future, which could harm our ability to increase volume on the Daric platform.
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+Our principal competitors include major banking institutions, credit unions, credit card issuers and other consumer finance companies, as well as other peer to peer lending platforms, including Prosper Marketplace, Virgin Money, Daric, and Zopa. Competition could result in reduced volumes, reduced fees or the failure of our peer to peer lending platform to achieve or maintain more widespread market acceptance, any of which could harm our business. In addition, in the future we may experience new competition from more established Internet companies, such as eBay Inc., Google Inc. or Yahoo! Inc., possessing large, existing customer bases, substantial financial resources and established distribution channels. If any of these companies or any major financial institution decided to enter the peer to peer lending business, acquire one of our existing competitors or form a strategic alliance with one of our competitors, our ability to compete effectively could be significantly compromised and our operating results could be harmed.
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+Most of our current or potential competitors have significantly more financial, technical, marketing and other resources than we do and may be able to devote greater resources to the development, promotion, sale and support of their platforms and distribution channels. Our potential competitors may also have longer operating histories, more extensive customer bases, greater brand recognition and broader customer relationships than we have. These competitors may be better able to develop new products, to respond quickly to new technologies and to undertake more extensive marketing campaigns. Our industry is driven by constant innovation. If we are unable to compete with such companies and meet the need for innovation, the demand for our platform could stagnate or substantially decline.
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+If we fail to promote and maintain our brand in a cost-effective manner, we may lose market share and our revenue may decrease.
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+We believe that developing and maintaining awareness of the Daric brand in a cost-effective manner is critical to achieving widespread acceptance of peer to peer lending through Daric and attracting new members. Furthermore, we believe that the importance of brand recognition will increase as competition in the peer to peer lending industry increases. Successful promotion of our brand will depend largely on the effectiveness of our marketing efforts and the member experience on the Daric platform.
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+Our arrangements for backup servicing are limited. If we fail to maintain operations, you may experience a delay, increased cost or nonpayment in respect of your expected principal and interest payments on your Notes, and we may be unable to collect and process repayments from borrower members.
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+We have made arrangements for only limited backup servicing. If our platform were to fail or we became insolvent, we would attempt to transfer our member loan servicing obligations to a third party back-up servicer. There can be no assurance that a back-up servicer will be willing or able to adequately perform the servicing of the outstanding member loans. If a back-up servicer assumes the servicing of the member loans, the back-up servicer would be expected to impose additional servicing fees, reducing the amounts available for payments on the Notes. Additionally, transferring these servicing obligations to our back-up servicer may result in delays in the processing and recovery of information with respect to amounts owed on the member loans or, if the Daric platform becomes inoperable, may prevent us from servicing the member loans and making principal and interest payments on the Notes. If our back-up servicer is not able to service the member loans effectively, lender members ability to receive principal and interest payments on their Notes may be substantially impaired.
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+If we were to become subject to a bankruptcy or similar proceeding, the rights of the holders of the Notes would be uncertain, and payments on the Notes may be limited and suspended or stopped. The recovery of a holder on a Note may be substantially delayed and substantially less than the principal and interest due and to become due on the Note. Even funds held by Daric in trust for the holders of Notes may potentially be at risk.
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+If Daric were to become subject to a bankruptcy or similar proceeding, there may be consequences with respect to your Notes, including (without limitation) the following:
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+Generally. If Daric were to become subject to a bankruptcy or similar proceeding, the recovery, if any, of a holder of a Note, if any, may be substantially delayed in time and may be substantially less in amount than the principal and interest due and to become due on the Note.
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+Delay in Borrower Member Payments. Borrower members may delay payments to Daric on account of member loans because of the uncertainties occasioned by a bankruptcy or similar proceeding of Daric, even if the borrower members have no legal right to do so, and such delay would reduce, at least for a time, the funds that might otherwise be available to pay the Notes corresponding to those member loans.
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+Delay in Payments on Notes. The commencement of the bankruptcy or similar proceeding may, as a matter of law, prevent Daric from making regular payments on the Notes, even if the funds to make such payments are available. Because a bankruptcy or similar proceeding may take months or years to complete, the suspension of payment may effectively reduce the value of any recovery that a holder of a Note may receive (and no such recovery can be assured) by the time any recovery is available.
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+Cessation of Interest Accrual. The bankruptcy or similar proceeding may stop the accrual of interest on the Notes during the proceeding. If the holder of a Note receives a recovery on the Note (and no such recovery can be assured), any such recovery may be based on, and limited to, the claim of the holder of the Note for principal and for interest accrued up to the date of the bankruptcy or similar proceeding, but not thereafter. Because a bankruptcy or similar proceeding may take months or years to complete, a claim based on principal and on interest only up to the start of the bankruptcy or similar proceeding may be substantially less than a claim based on principal and on interest through the end of the bankruptcy or similar proceeding.
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+Uncertainty Regarding Whether a Holder of a Note Has Any Priority Right to Payment from Corresponding Member Loan. In a bankruptcy or similar proceeding of Daric, it is possible that a Note could be deemed to have a priority or exclusive right of payment from some or all proceeds of the corresponding member loan, in which case the holder of the Note may not be required to share such proceeds of the corresponding member loan with other creditors of Daric. Alternatively, to the extent that no such priority or exclusive right were deemed to exist, the holder of a Note may be required to share the proceeds of the corresponding member loan with Daric s other creditors. If such sharing of proceeds is deemed appropriate, those proceeds that are either held by Daric in the clearing account at the time of the bankruptcy or similar proceeding of Daric, or not yet received by Daric from borrower members at the time of the commencement of the bankruptcy or similar proceeding, may be at greater risk than those proceeds that are already held by Daric in the ITF account at the time of the bankruptcy or similar proceeding. To the extent that proceeds of the corresponding member loan would be shared with other creditors of Daric, any secured or priority rights of such other creditors may cause the proceeds to be distributed to such other creditors before any distribution is made to you on your Note. For a more detailed description of the clearing account and the ITF account, see How the Daric Platform Operates Post-Closing Loan Servicing and Collection. 
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+Uncertainty Regarding Whether a Holder of a Note Has Any Right of Payment from Other Assets of Daric. In a bankruptcy or similar proceeding of Daric, it is possible that a Note could be deemed to have a right of payment only from proceeds of the corresponding member loan and not from any other assets of Daric, in which case the holder of the Note may not be entitled to share the proceeds of such other assets of Daric with other creditors of Daric, whether or not, as described above, such other creditors would be entitled to share in the proceeds of the member loan corresponding to the Note. Alternatively, it is possible that a Note could be deemed to have a right of payment from both the member loan corresponding to the Note and from some or all other assets of Daric, for example, based upon the automatic acceleration of the principal obligations on the Notes upon the commencement of a bankruptcy or similar proceeding, in which case the holder of the Note may be entitled to share the proceeds of such other assets of Daric with other creditors of Daric, whether or not, as described above, such other creditors would be entitled to share in the proceeds of the member loan corresponding to the Note. See Description of the Notes Events of Default. To the extent that proceeds of such other assets would be shared with other creditors of Daric, any secured or priority rights of such other creditors may cause the proceeds to be distributed to such other creditors before any distribution is made to you on your Note.
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+Uncertainty Regarding Rights of a Holder of a Note to Payment from Funds in Clearing Account. If a borrower member has paid Daric on a member loan corresponding to a Note before a bankruptcy or similar proceeding of Daric is commenced, and those funds are held in the clearing account and have not been used by Daric to make payments on the Note as of the date the bankruptcy or similar proceeding is commenced, there can be no assurance that Daric will or will be able to use such funds to make payments on the Note. Other creditors of Daric may be deemed to have rights to such funds that are equal to or greater than the rights of the holder of the Note. For a more detailed description of the clearing account, see How the Daric Platform Operates Post-Closing Loan Servicing and Collection. 
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+Uncertainty Regarding Rights of a Holder of a Note to Payment from Funds in ITF Account. If a borrower has paid Daric on a member loan corresponding to a Note before a bankruptcy or similar proceeding of Daric is commenced, and those funds have been used by Daric to make payments on the Note prior to the date the bankruptcy or similar proceeding is commenced, but the payments on the Note continue to be held by Daric in an ITF account, there can be no assurance that the holder of the Note will have immediate access to the funds constituting the payment or that the funds constituting the payment will ultimately be released to the holder of the Note. For a more detailed description of the ITF account, see How the Daric Platform Operates Post-Closing Loan Servicing and Collection. 
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+Uncertain Rights of a Holder of a Note to Return of Purchase Price if Member Loan Not Funded. If the purchase price of a Note is paid to Daric and a bankruptcy or similar proceeding of Daric is commenced, the holder of the Note may not be able to obtain a return of the funds constituting the purchase price, even if the member loan corresponding to the Note has not been funded as of the date that the bankruptcy or similar proceeding is commenced and even if the funds are held by Daric in a ITF account. For a more detailed description of the funding of member loans, see How the Daric Platform Operates Purchases of Notes and Loan Closings. 
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+Repurchase Obligations. In a bankruptcy or similar proceeding of Daric, any right of a holder of Note to require Daric to repurchase the Note as a result of a confirmed identity fraud incident may not be specifically enforced, and such holder s claim for such repurchase may be treated as a special, limited unsecured obligation of Daric or a general unsecured obligation of Daric as described and subject to the limitations in this Risks Related to Daric and the Daric Platform If we were to become subject to a bankruptcy or similar proceeding section. See Description of the Notes Mandatory Redemption, for further information on the repurchase obligation of Daric upon a confirmed identity fraud incident.
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+Back-Up Servicing. In a bankruptcy or similar proceeding of Daric, our ability to transfer servicing obligations to our back-up servicer may be limited and subject to the approval of the bankruptcy court or other presiding authority. The bankruptcy process may delay or prevent the implementation of back-up servicing, which may impair the collection of member loans to the detriment of the Notes.
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+We rely on third-party banks to disburse member loan proceeds and process member loan payments, and we rely on third-party computer hardware and software. If we are unable to continue utilizing these services, our business and ability to service the member loans on which the Notes are dependent may be adversely affected.
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+We rely on a third-party bank to disburse member loan amounts. Additionally, because we are not a bank, we cannot belong to and directly access the Automated Clearing House ( ACH ) payment network, and we must rely on an FDIC-insured depository institution to process our transactions, including loan payments and remittances to our Noteholders. We currently use Wells Fargo Bank, N.A. for these purposes. Under the ACH rules, if we experience a high rate of reversed transactions (known as chargebacks ), we may be subject to sanctions and potentially disqualified from using the system to process payments. We also rely on computer hardware purchased and software licensed from third parties to operate our platform, including payment processing software licensed from BankServ. This hardware and software may not continue to be available on commercially reasonable terms, or at all. If we cannot continue to obtain these services, or if we cannot transition to another service provider quickly, our ability to process payments and operate the Daric platform could suffer, and your receipt of payments on the Notes could be delayed or impaired.
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+If the security of our members confidential information stored in our systems is breached or otherwise subjected to unauthorized access, your secure information may be stolen, our reputation may be harmed, and we may be exposed to liability.
+
+Our platform stores our borrower members and lender members bank information and other personally-identifiable sensitive data. Any accidental or willful security breaches or other unauthorized access could cause your secure information to be stolen and used for criminal purposes. Security breaches or unauthorized access to secure information could also expose us to liability related to the loss of the information, time-consuming and expensive litigation and negative publicity. If security measures are breached because of third-party action, employee error, malfeasance or otherwise, or if design flaws in our software are exposed and exploited, and, as a result, a third party or disaffected employee obtains unauthorized access to any of our members data, our relationships with our members will be severely damaged, and we could incur significant liability. Because techniques used to obtain unauthorized access or to sabotage systems change frequently and generally are not recognized until they are launched against a target, we and our third-party hosting facilities may be unable to anticipate these techniques or to implement adequate preventative measures. In addition, many states have enacted laws requiring companies to notify individuals of data security breaches involving their personal data. These mandatory disclosures regarding a security breach are costly to implement and often lead to widespread negative publicity, which may cause our members to lose confidence in the effectiveness of our data security measures. Any security breach, whether actual or perceived, would harm our reputation, and we could lose members.
+
+Our ability to service the member loans or maintain accurate accounts may be adversely affected by computer viruses, physical or electronic break-ins and similar disruptions.
+
+The highly-automated nature of the Daric platform may make it an attractive target and potentially vulnerable to computer viruses, physical or electronic break-ins and similar disruptions. If a computer hacker were able to infiltrate the Daric platform, you would be subject to an increased risk of fraud or borrower identity theft, and you may not receive the principal or interest payments that you expect to receive on any Notes you were fraudulently induced to purchase. Hackers might also disrupt the accurate processing and posting of payments to accounts such as yours on the platform, or cause the destruction of data and thereby undermine your rights to repayment of the Notes you have purchased. While we have taken steps to prevent hackers from accessing the Daric platform, if we are unable to prevent hacker access, your ability to receive the principal and interest payments that you expect to receive on Notes you purchase and our ability to fulfill our servicing obligations and to maintain the Daric platform would be adversely affected.
+
+Any significant disruption in service on our website or in our computer systems could reduce the attractiveness of our platform and result in a loss of members.
+
+If a catastrophic event resulted in a platform outage and physical data loss, our ability to perform our servicing obligations would be materially and adversely affected. The satisfactory performance, reliability and availability of our technology and our underlying network infrastructure are critical to our operations, level of customer service, reputation and ability to attract new members and retain existing members. Our system hardware is hosted on Amazon Web Services' EC2 instance in Northern Virginia, currently owned and operated by Amazon, Inc. We also maintain a real time backup system located in a separate Ubuntu cluster on Amazon EC2. Amazon does not guarantee that our members access to our website will be uninterrupted, error-free or secure. Our operations depend on Amazon s ability to protect their and our systems in their facilities against damage or interruption from natural disasters, power or telecommunications failures, air quality, temperature, humidity and other environmental concerns, computer viruses or other attempts to harm our systems, criminal acts and similar events. If our arrangement with Amazon is terminated, or there is a lapse of service or damage to Amazon facilities, we could experience interruptions in our service as well as delays and additional expense in arranging new facilities. Any interruptions or delays in our service, whether as a result of Amazon or other third-party error, our own error, natural disasters or security breaches, whether accidental or willful, could harm our relationships with our members and our reputation. Additionally, in the event of damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur. Our disaster recovery plan has not been tested under actual disaster conditions, and we may not have sufficient capacity to recover all data and services in the event of an outage at a Amazon facility. These factors could prevent us from processing or posting payments on the member loans or the Notes, damage our brand and reputation, divert our employees attention, reduce our revenue, subject us to liability and cause members to abandon the Daric platform, any of which could adversely affect our business, financial condition and results of operations.
+
+Competition for our employees is intense, and we may not be able to attract and retain the highly skilled employees whom we need to support our business.
+
+Competition for highly skilled technical and financial personnel is extremely intense. We may not be able to hire and retain these personnel at compensation levels consistent with our existing compensation and salary structure. Many of the companies with which we compete for experienced employees have greater resources than we have and may be able to offer more attractive terms of employment.
+
+In addition, we invest significant time and expense in training our employees, which increases their value to competitors who may seek to recruit them. If we fail to retain our employees, we could incur significant expenses in hiring and training their replacements and the quality of our services and our ability to serve Daric members could diminish, resulting in a material adverse effect on our business.
+
+Our growth could strain our personnel resources and infrastructure, and if we are unable to implement appropriate controls and procedures to manage our growth, we may not be able to successfully implement our business plan.
+
+Our growth in headcount and operations since our inception has placed, and will continue to place, to the extent that we are able to sustain such growth, a significant strain on our management and our administrative, operational and financial reporting infrastructure.
+
+Our success will depend in part on the ability of our senior management to manage the growth we achieve effectively. To do so, we must continue to hire, train and manage new employees as needed. If our new hires perform poorly, or if we are unsuccessful in hiring, training, managing and integrating these new employees, or if we are not successful in retaining our existing employees, our business may be harmed. To manage the expected growth of our operations and personnel, we will need to continue to improve our operational and financial controls and update our reporting procedures and systems. The addition of new employees and the system development that we anticipate will be necessary to manage our growth will increase our cost base, which will make it more difficult for us to offset any future revenue shortfalls by reducing expenses in the short term. If we fail to successfully manage our growth, we will be unable to execute our business plan.
+
+If we fail to retain our key personnel, we may not be able to achieve our anticipated level of growth and our business could suffer.
+
+Our future depends, in part, on our ability to attract and retain key personnel. Our future also depends on the continued contributions of our executive officers and other key technical personnel, each of whom would be difficult to replace. In particular, Greg Ryan, our Chief Executive Officer, and Vasant Ramachandran, our Chief Technology Officer, are critical to the management of our business and operations and the development of our strategic direction. The loss of the services of Mr. Ryan, Mr. Ramachandran or other executive officers or key personnel and the process to replace any of our key personnel would involve significant time and expense and may significantly delay or prevent the achievement of our business objectives.
+
+It may be difficult and costly to protect our intellectual property rights, and we may not be able to ensure their protection.
+
+Our ability to maintain the Daric platform and arrange member loans depends, in part, upon our proprietary technology. We may not protect our proprietary technology effectively, however, which would allow competitors to duplicate our products and adversely affect our ability to compete with them. A third party may attempt to reverse engineer or otherwise obtain and use our proprietary technology without our consent. In addition, the Daric platform may infringe upon claims of third-party patents, and we may face intellectual property challenges from such other parties. We may not be successful in defending against any such challenges or in obtaining licenses to avoid or resolve any intellectual property disputes. Furthermore, our technology may become obsolete, and there is no guarantee that we will be able to successfully develop, obtain or use new technologies to adapt the Daric platform to compete with other person-to-person lending platforms as they develop. If we cannot protect our proprietary technology from intellectual property challenges, or if the platform becomes obsolete, our ability to maintain the platform, arrange member loans or perform our servicing obligations on the member loans could be adversely affected.
+
+Purchasers of Notes will have no control over Daric and will not be able to influence Daric corporate matters.
+
+We are not offering any equity in this offering. Purchasers of Notes offered through the Daric platform will have no equity interest in Daric and no ability to vote on or influence Daric corporate decisions. As a result, our stockholders will continue to exercise 100% voting control over all Daric corporate matters, including the election of directors and approval of significant corporate transactions, such as a merger or other sale of our company or its assets.
+
+RISKS RELATING TO COMPLIANCE AND REGULATION
+
+The Daric platform is a novel approach to borrowing that may fail to comply with borrower protection laws such as state usury laws, other interest rate limitations or federal and state consumer protection laws such as the Truth in Lending Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act and the Fair Debt Collection Practices Act and their state counterparts. Borrower members may make counterclaims regarding the enforceability of their obligations after collection actions have commenced, or otherwise seek damages under these laws. Compliance with such regimes is also costly and burdensome.
+
+The Daric platform operates a novel program that must comply with regulatory regimes applicable to all consumer credit transactions. The novelty or our platform means compliance with various aspect of such laws is untested. Certain state laws generally regulate interest rates and other charges and require certain disclosures. In addition, other state laws, public policy and general principles of equity relating to the protection of consumers, unfair and deceptive practices and debt collection practices may apply to the origination, servicing and collection of the member loans. Our platform is also subject to other federal and state laws, such as: the federal Truth-in-Lending Act and Regulation Z promulgated thereunder, and similar state laws, which require certain disclosures to borrower members regarding the terms of their member loans; the federal Equal Credit Opportunity Act and Regulation B promulgated thereunder, which prohibit discrimination on the basis of age, race, color, sex, religion, marital status, national origin, receipt of public assistance or the exercise of any right under the Consumer Credit Protection Act, in the extension of credit; the federal Fair Credit Reporting Act, which regulates the use and reporting of information related to each borrower member s credit history; andthe federal Fair Debt Collection Practices Act and similar state debt collection laws, which regulate debt collection practices by debt collectors and prohibit debt collectors from engaging in certain practices in collecting, and attempting to collect, outstanding consumer loans.
+
+Compliance with these requirements is also costly, time-consuming and limits our operational flexibility. See About Daric Government Regulation for more information regarding governmental regulation of the Daric platform.
+
+Noncompliance with laws and regulations may impair our ability to arrange or service member loans.
+
+Generally, failure to comply with the laws and regulatory requirements applicable to our business may, among other things, limit our, or a collection agency s, ability to collect all or part of the principal amount of or interest on the member loans on which the Notes are dependent and, in addition, could subject us to damages, revocation of required licenses or other authorities, class action lawsuits, administrative enforcement actions, and civil and criminal liability, which may harm our business and ability to maintain the Daric platform and may result in borrower members rescinding their member loans.
+
+Where applicable, we seek to comply with state small loan, loan broker, servicing and similar statutes. We launch with services in California, Texas, New York, Florida, and Illinois. In all other U.S. jurisdictions with licensing or other requirements we believe may be applicable to make loans, we have obtained any necessary licenses or comply with the relevant requirements. Nevertheless, if we are found to not comply with applicable laws, we could lose one or more of our licenses or authorizations or face other sanctions, which may have an adverse effect on our ability to continue to arrange member loans through the platform, perform our servicing obligations or make the Daric platform available to borrower members in particular states, which may impair your ability to receive the payments of principal and interest on your Notes that you expect to receive. See About Daric Government Regulation for more information regarding governmental regulation of the Daric platform.
+
+We rely on our agreement with WebBank to lend to qualified borrower members on a uniform basis throughout the United States. If our relationship with WebBank were to end, we may need to rely on individual state lending licenses to arrange member loans.
+
+Borrower member loan requests take the form of an application to WebBank, which cooperates with us to lend to qualified Daric borrower members and allows our platform to be available to borrowers on a uniform basis in our states of operation. If our relationship with WebBank were to end, we may need to rely on individual state lending licenses to arrange member loans. Because we do not currently possess state lending licenses in every U.S. state, we may be required to discontinue lending or limit the rates of interest charged on member loans in some states. We may face increased costs and compliance burdens if our agreement with WebBank terminated.
+
+Several lawsuits have sought to recharacterize certain loan marketers and other originators as lenders. If litigation on similar theories were successful against us, member loans originated through the Daric platform could be subject to state consumer protection laws in a greater number of states.
+
+Several lawsuits have brought under scrutiny the association between high-interest payday loan marketers and out-of-state banks. These lawsuits assert that payday loan marketers use out-of-state lenders in order to evade the consumer protection laws imposed by the states where they do business. Such litigation has sought, successfully in some instances, to recharacterize the loan marketer as the lender for purposes of state consumer protection law restrictions. Similar civil actions have been brought in the context of gift cards. We believe that our activities are distinguishable from the activities involved in these cases.
+
+Additional state consumer protection laws would be applicable to the member loans originated through the Daric platform if we were recharacterized as a lender, and the member loans could be voidable or unenforceable. In addition, we could be subject to claims by borrower members, as well as enforcement actions by regulators. Even if we were not required to cease doing business with residents of certain states or to change our business practices to comply with applicable laws and regulations, we could be required to register or obtain licenses or regulatory approvals that could impose a substantial cost on us. To date, no actions have been taken or threatened against us on the theory that we have engaged in unauthorized lending. However, such actions could have a material adverse effect on our business.
+
+As Internet commerce develops, federal and state governments may draft and propose new laws to regulate Internet commerce, which may negatively affect our business.
+
+As Internet commerce continues to evolve, increasing regulation by federal and state governments becomes more likely. Our business could be negatively affected by the application of existing laws and regulations or the enactment of new laws applicable to peer to peer lending. The cost to comply with such laws or regulations could be significant and would increase our operating expenses, and we may be unable to pass along those costs to our members in the form of increased fees. In addition, federal and state governmental or regulatory agencies may decide to impose taxes on services provided over the Internet. These taxes could discourage the use of the Internet as a means of consumer lending, which would adversely affect the viability of the Daric platform.
+
+Our legal compliance burdens and costs will significantly increase as a result of operating as a public company following the date of this prospectus. Our management will be required to devote substantial time to compliance matters.
+
+After the date of this prospectus, we will become a public company and will incur significant legal, accounting and other expenses that we did not incur as a private company. Our management and other personnel will need to devote a substantial amount of time to public company compliance requirements. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, these rules and regulations may make it more expensive for us to obtain director and officer liability insurance coverage and more difficult for us to attract and retain qualified persons to serve as directors or executive officers.
+
+In addition, the Sarbanes-Oxley Act requires, among other things, that we maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, for the year ending March 31, 2015, we must perform system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal controls over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. Our testing, or the subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal control over financial reporting that are deemed to be material weaknesses. In order to comply with Section 404, we may incur substantial accounting expense, expend significant management time on compliance-related issues, and hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge. Moreover, if we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered public accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.
+
+Forward-Looking Statements
+
+This prospectus contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this prospectus regarding Daric borrowers, credit scoring, FICO scores, our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth are forward-looking statements. The words anticipate, believe, estimate, expect, intend, may, plan, predict, project, will, would and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include, among other things, statements about:
+
+ 
+
+the status of borrower members, the ability of borrower members to repay member loans and the plans of borrower members;
+
+ 
+
+ 
+
+expected rates of return and interest rates;
+
+ 
+
+ 
+
+the attractiveness of our lending platform;
+
+ 
+
+ 
+
+our financial performance;
+
+ 
+
+ 
+
+our ability to retain and hire necessary employees and appropriately staff our operations;
+
+ 
+
+ 
+
+regulatory developments;
+
+ 
+
+ 
+
+our intellectual property; and
+
+ 
+
+our estimates regarding expenses, future revenue, capital requirements and needs for additional financing.
+
+We may not actually achieve the plans, intentions or expectations disclosed in forward-looking statements, and you should not place undue reliance on forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in forward-looking statements. We have included important factors in the cautionary statements included in this prospectus, particularly in the Risk Factors section, that could cause actual results or events to differ materially from forward-looking statements contained in this prospectus. Forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.
+
+You should read this prospectus and the documents that we have filed as exhibits to the
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001580836_lvyuan_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001580836_lvyuan_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..b0a0065c4f3adc3b3c593daf2e96569f2b04a016
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001580836_lvyuan_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, "WE," "US," "OUR," AND "GREEN SUPPLEMENTS ONLINE INC." REFERS TO GREEN SUPPLEMENTS ONLINE INC .THE FOLLOWING SUMMARY IS NOT COMPLETE AND DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK. GREEN SUPPLEMENTS ONLINE INC. Green Supplements Online Inc. was incorporated in Nevada on January 10, 2013. We are a development stage company that was formed to market and sell a line of nutrition and dietary products. We have an agreement with Green Medicine, Inc., a Nevada corporation, to act as distributes of our future products. Our plan is to outsource manufacturing and sell the finished products under our brand name. Currently, we have not yet initiated any product development efforts. We intend to use the net proceeds from this offering to develop our business operations (See "Description of Business" and "Use of Proceeds" elsewhere in this Prospectus). Our principal executive offices are located at 112 N. Curry Street, Carson City NV 89703. Our phone number is (702) 605-4287. From inception until the date of this filing, we have had very limited operating activities. Our financial statements from inception (January 10, 2013) through July 31, 2013, reports no revenues and a net loss of $6,195. Our independent registered public accounting firm has issued an audit opinion for Green Supplements Online Inc. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. Our sole officer and director will offer shares of our common stock to his friends, family members and business associates. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. THE OFFERING The Issuer: Green Supplements Online Inc. Securities Being Offered: 5,000,000 shares of common stock. Price Per Share: $0.02 Duration of the Offering: The offering shall terminate on the earlier of (i) the date when the sale of all 5,000,000 common shares is completed; (ii) one year from the date of this prospectus; or (iii) prior to one year at the sole determination of our director Mr.Semenets. Gross Proceeds: $100,000 Securities Issued and Outstanding: There are 6,000,000 shares of common stock issued and outstanding as of the date of this prospectus, held solely by our President and Secretary, Vyacheslav Semenets. Subscriptions: All subscriptions once accepted by us are irrevocable. Registration Costs: We estimate our total offering registration costs to be approximately $9,500. Risk Factors: See "Risk Factors" and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock. SUMMARY FINANCIAL INFORMATION The tables and information below are derived from our audited financial statements for the period from January 10, 2013 (Inception) to April 30, 2013. FINANCIAL SUMMARY As of April 30, 2013 ($) ------------------------ Cash and Deposits 6,100 Total Assets 6100 Total Liabilities 374 Total Stockholder's Equity 5,726 STATEMENT OF OPERATIONS Accumulated From January 10, 2013 (Inception) to April 30, 2013 ($) ------------------ Total Expenses 274 Net Loss for the Period (274) Net Loss per Share --
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001581043_associated_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001581043_associated_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001581043_associated_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2013/CIK0001581545_gl-brands_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001581545_gl-brands_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..0c87fc1fa5674e032836032be6baa9d3da15fa6e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001581545_gl-brands_prospectus_summary.txt
@@ -0,0 +1,70 @@
+Prospectus Summary," "Risk Factors," Management s
+Discussion and Analysis of Financial Condition and Results of Operations," "Description of Business" and elsewhere
+that constitute forward-looking statements. Forward-looking statements involve risks and uncertainties, such as statements about
+our plans, objectives, expectations, assumptions or future events. In some cases, you can identify forward-looking statements
+by terminology such as "anticipate," "estimate," "plan," "project," "continuing,"
+"ongoing," "expect," "we believe," "we intend," "may," "should,"
+"will," "could" and similar expressions denoting uncertainty or an action that may, will or is expected
+to occur in the future. These statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors
+that could cause actual results to differ materially from any future results, performances or achievements expressed or implied
+by the forward-looking statements.
+
+ 
+
+Examples
+of forward-looking statements include:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ timing of the development of future services ;
+
+ 
+ 
+ 
+ projections
+ of revenue, earnings, capital structure and other financial items;
+
+ 
+ 
+ 
+ statements
+ of our plans and objectives;
+
+ 
+ 
+ 
+ statements
+ regarding the capabilities of our business operations;
+
+ 
+
+ 
+ 
+ 
+ statements
+ of expected future economic performance;
+
+ 
+ 
+ 
+ statements
+ regarding competition in our market; and
+
+ 
+ 
+ 
+ assumptions
+ underlying statements regarding our business or us.
+
+ 
+
+The
+ultimate correctness of these forward-looking statements depends upon a number of known and unknown risks and events. We discuss
+our known material risks under the heading "
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001583103_valero_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001583103_valero_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001583103_valero_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001584133_sungy_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001584133_sungy_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001584133_sungy_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/CIK0001588172_aptalis_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/CIK0001588172_aptalis_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/CIK0001588172_aptalis_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/EVTC_evertec_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/EVTC_evertec_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..75b69155512896bed0ddb4fcabd7a53124d0f998
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/EVTC_evertec_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary highlights key aspects of the information contained elsewhere in this prospectus and may not contain all of the information you should consider before making an investment decision. You should read this summary together with the entire prospectus, including the information presented under the heading Risk Factors and the more detailed information in the historical financial statements and related notes appearing elsewhere in this prospectus. For a more complete description of our business, see the Business section in this prospectus. Company Overview EVERTEC is the leading full-service transaction processing business in Latin America and the Caribbean. We are based in Puerto Rico and provide a broad range of merchant acquiring, payment processing and business process management services across 19 countries in the region. We process over 1.8 billion transactions annually, and manage the electronic payment network for over 4,100 automated teller machines ( ATM ) and over 104,000 point-of-sale ( POS ) payment terminals. According to the July 2013 Nilson Report, we are the largest merchant acquirer in the Caribbean and Central America and the seventh largest in Latin America based on total number of transactions. We own and operate the ATH network, one of the leading ATM and personal identification number ( PIN ) debit networks in Latin America. In addition, we provide a comprehensive suite of services for core bank processing, cash processing and technology outsourcing in the regions we serve. We serve a broad and diversified customer base of leading financial institutions, merchants, corporations and government agencies with mission critical technology solutions that are essential to their operations, enabling them to issue, process and accept transactions securely, and we believe that our business is well positioned to continue to expand across the fast growing Latin American region. We are differentiated, in part, by our diversified business model, which enables us to provide our varied customer base with a broad range of transaction processing services from a single source across numerous channels and geographic markets. We believe this single source capability provides several competitive advantages which will enable us to continue to penetrate our existing customer base with new, complementary services, win new customers, develop new sales channels and enter new markets. We believe these competitive advantages include: Our ability to package and provide a range of services across our customers business that often need to be sourced from different vendors; Our ability to serve customers with disparate operations in several geographies with a single integrated technology solution that enables them to manage their business as one enterprise; and Our ability to capture and analyze data across the transaction processing value chain to provide value-added services that are differentiated from those offered by pure play vendors that only have the technology, capabilities and products to serve one portion of the transaction processing value chain (such as only merchant acquiring or payment processing). Our broad suite of services span the entire transaction processing value chain and include a range of front-end customer facing solutions as well as back-end support services. These include: (i) merchant acquiring services, which enable POS and e-commerce merchants to accept and process electronic methods of payment such as debit, credit, prepaid and electronic benefits transfer ( EBT ) cards; (ii) payment processing services, which enable financial institutions and other issuers to manage, support and facilitate the processing for credit, debit, prepaid, ATM and EBT card programs; and (iii) business process management solutions, which provide mission critical technology solutions such as core bank processing, as well as information technology ( IT ) outsourcing and cash management services to financial institutions, enterprises and governments. We provide these services through a highly scalable, end-to-end technology platform that we manage and operate in-house. Table of Contents The information in this prospectus is not complete and may be changed. The selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to completion, dated December 3, 2013 PRELIMINARY PROSPECTUS 15,287,473 Shares EVERTEC, Inc. Common Stock $ per share This is a public offering of shares of common stock of EVERTEC, Inc. The selling stockholders identified in this prospectus are selling 15,287,473 shares. We will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders in this offering. Subject to completion of this offering, we will repurchase from the underwriters $75 million of our common stock being sold by the selling stockholders in this offering. We will repurchase our common stock at the price per share at which the underwriters purchase such shares from the selling stockholders in this offering. The closing of the share repurchase and this offering are contingent on each other. Our shares of common stock are listed on the New York Stock Exchange ( NYSE ) under the symbol EVTC. The last reported sale price of our common stock on December 2, 2013 was $22.25 per share. We are an emerging growth company under applicable federal securities laws and are eligible for reduced public company reporting requirements. See Risk Factors Risks Related to Our Business As an emerging growth company under the JOBS Act, we are permitted to, and intend to, rely on exemptions from certain reporting and disclosure requirements, which may make our public filings different than that of other public companies. Investing in our common stock involves risks that are described in the Risk Factors section beginning on page 20 of this prospectus. Price to Public Underwriting Discounts(1)(2) Proceeds to Selling Stockholders Per Share $ $ $ Total $ $ $ (1) See Underwriting for a description of the compensation payable to the underwriters. (2) No underwriting discount or commissions will be paid to the underwriters with respect to the shares purchased by us in this offering. Delivery of the shares of common stock will be made on or about , 2013. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Goldman, Sachs & Co. J.P. Morgan The date of this prospectus is , 2013. Table of Contents Our end-to-end technology platform includes solutions that encompass the entire transaction processing value chain. This enables us to provide front-end processing services, such as the electronic capture and authorization of transactions at the point-of-sale, and back-end services, such as the clearing and settlement of transactions and account reconciliation for card issuers. Our platform provides us with the broad range of capabilities, flexibility and operating leverage that enable us to innovate and develop new services, differentiate ourselves in the marketplace and generate significant operating efficiencies to continue to maximize profitability. We sell and distribute our services primarily through a proprietary direct sales force with strong customer relationships. We are also increasingly building a variety of indirect sales channels which enable us to leverage the distribution capabilities of partners in adjacent markets, including value-added resellers, joint ventures and merchant acquiring alliances. Given our breadth across the transaction processing value chain, our customer base is highly diversified by size, type and geographic footprint. We benefit from an attractive business model, which is characterized by recurring revenue, significant operating margins and low capital expenditure requirements. Our revenue is recurring in nature because of the mission-critical and embedded nature of the services we provide, the high switching costs associated with these services and the multi-year contracts we negotiate with our customers. Our scalable business model creates significant operating efficiencies. In addition, our business model enables us to continue to grow our business organically without significant additional capital expenditures. We generate revenues based primarily on transaction or discount fees paid by our merchants and financial institutions in our Merchant Acquiring and Payment Processing segments and on transaction fees or fees based on number of accounts on file in our Business Solutions segment. Our total revenues increased from $276.3 million for the year ended December 31, 2009 to $354.9 million for the twelve months ended September 30, 2013, representing a compound annual growth rate ( CAGR ) of 7%. Our Adjusted EBITDA (as defined below in Note 3 to Summary Historical Consolidated and Combined Financial Data ) increased from $117.6 million for the year ended December 31, 2009 to $180.7 million for the twelve months ended September 30, 2013, representing a CAGR of 12%. Our Adjusted Net Income (as defined below in Note 3 to Summary Historical Consolidated and Combined Financial Data ) increased from $58.2 million for the year ended December 31, 2009 to $113.6 million for the twelve months ended September 30, 2013, representing a CAGR of 20%. History and Separation from Popular We have a 25 year operating history in the transaction processing industry. Prior to the Merger on September 30, 2010, EVERTEC, LLC was 100% owned by Popular, Inc. ( Popular ), the largest financial institution in the Caribbean, and operated substantially as an independent entity within Popular. In September 2010, Apollo Global Management, LLC, a leading private equity investor, acquired a 51% interest in EVERTEC and shortly thereafter, we began the transition to a separate, stand-alone entity. As a stand-alone company, we have made substantial investments in our technology and infrastructure, recruited various senior executives with significant transaction processing experience in Latin America, enhanced our profitability through targeted productivity and cost savings actions and broadened our footprint beyond the markets historically served. We continue to benefit from our relationship with Popular. Popular is our largest customer, acts as one of our largest merchant referral partners and sponsors us with the card associations (such as Visa or MasterCard), enabling merchants to accept these card associations credit card transactions. Popular also provides merchant sponsorship as one of the participants of the ATH network, enabling merchants to connect to the ATH network and accept ATH debit card transactions. We provide a number of critical products and services to Popular, which are governed by a 15-year Amended and Restated Master Services Agreement (the Master Services Agreement ) that runs through 2025. For more information on the Master Services Agreement and other related party agreements, see Principal Stockholders and Certain Relationships and Related Party Transactions Related Party Transactions in Connection with the Closing of the Merger. Table of Contents Industry Trends Shift to Electronic Payments The ongoing migration from cash, check and other paper methods of payment to electronic payments continues to benefit the transaction processing industry globally. This migration is driven by factors including customer convenience, marketing efforts by financial institutions, card issuer rewards and the development of new forms of payment. We believe that the penetration of electronic payments in the markets where we principally operate is significantly lower relative to more mature U.S. and European markets and that this ongoing shift will continue to generate substantial growth opportunities for our business. Fast Growing Latin American and Caribbean Financial Services and Payments Markets Currently, the adoption of banking products, including electronic payments, in the Latin American and Caribbean region is lower relative to the mature U.S. and European markets. As these markets continue to evolve and grow, the emergence of a larger and more sophisticated consumer base will influence and drive an increase in card and electronic payments usage. According to the January 2013 Nilson Report, Latin American purchase transactions are projected to grow at a CAGR of 15% through 2016 (as illustrated in the chart below) and represents the third fastest growing market in the world. We believe that the attractive characteristics of our markets and our leadership positions across multiple services and sectors will continue to drive growth and profitability in our businesses. Ongoing Technology Outsourcing Trends Financial institutions globally are facing significant challenges including the entrance of non-traditional competitors, the compression of margins on traditional products, significant channel proliferation and increasing regulation that could potentially curb profitability. Many of these institutions have traditionally fulfilled their IT needs through legacy computer systems, operated by the institution itself. Legacy systems are generally highly proprietary, inflexible and costly to operate and maintain and we believe the trend to outsource in-house technology systems and processes by financial institutions will continue. According to estimates published by Gartner Dataquest Market Statistics in October 2013, the banking and securities sector in Latin America is forecasted to have $33 billion of annual IT expenditures by 2017. We believe our ability to provide integrated, open, flexible, customer-centric and efficient IT products and services cater to the evolving needs of our customers, particularly for small- and mid-sized financial institutions in the Latin American markets in which we operate. Industry Innovation The electronic payments industry experiences ongoing technology innovation. Emerging payment technologies such as prepaid cards, contactless payments, payroll cards, mobile commerce, online wallets and innovative POS devices facilitate the continued shift away from cash, check and other paper methods of Table of Contents payment. According to the 2013 World Payments Report, the number of online payments for e-commerce activities and number of payments using mobile devices are projected to grow at compound annual growth rates of 18.1% and 58.5%, respectively from 2010 to 2014. The increasing demand for new and flexible payment options catering to a wider range of consumer segments is driving growth in the electronic payment processing sector. Our Competitive Strengths Market Leadership in Latin America and the Caribbean We believe we have an inherent competitive advantage relative to U.S. competitors based on our ability to locally leverage our infrastructure, as well as our first-hand knowledge of the Latin American and Caribbean markets, language and culture. We have built leadership positions across the transaction processing value chain in the geographic markets that we serve, which we believe will enable us to continue to penetrate our core markets and provide advantages to enter new markets. According to the July 2013 Nilson Report, we are the seventh largest merchant acquirer in Latin America and the largest in the Caribbean and Central America based on total number of transactions. We own and operate the ATH network, one of the leading ATM and PIN debit networks in Latin America. The ATH network and processing businesses processed over one billion transactions in 2012, which according to management estimates, makes ATH branded products the most frequently used electronic method of payment in Puerto Rico, exceeding the total transaction volume of Visa, MasterCard, American Express and Discover, combined. Given our scale and customer base of top tier financial institutions and government entities, we believe we are the leading card issuer and core bank processor in the Caribbean and the only non-bank provider of cash processing services to the U.S. Federal Reserve in the Caribbean. We believe our competitive position and strong brand recognition increases card acceptance, driving usage of our proprietary network, and presents opportunities for future strategic relationships. Diversified Business Model Across the Transaction Processing Value Chain Our leadership position in the region is driven in part by our diversified business model which provides the full range of merchant acquiring, payment processing and business solutions services to financial institutions, merchants, corporations and government agencies across different geographies. We offer end-to-end technology solutions through a single provider and we have the ability to tailor and customize the features and functionality of all our products and services to the specific requirements of our customers in various industries and across geographic markets. We believe the breadth of our offerings enables us to penetrate our customer base from a variety of perspectives and positions us favorably to cross-sell our other offerings over time. For example, we may host a client s electronic cash register software (part of the Business Solutions segment), acquire transactions that originate at that electronic cash register (part of the Merchant Acquiring segment), route the transaction through the ATH network (part of the Payment Processing segment), and finally settle the transaction between the client and the issuer bank (part of the Payment Processing segment). In addition, we can serve customers with disparate operations in several geographies with a single integrated technology solution that enables them to access one processing platform and manage their business as one enterprise. We believe these services are becoming increasingly complementary and integrated as our customers seek to capture, analyze and monetize the vast amounts of data that they process across their enterprises. As a result, we are able to capture significant value across the transaction processing value chain and believe that this combination of attributes represents a differentiated value proposition vis- -vis our competitors who have a limited product and service offering. Broad and Deep Customer Relationships and Recurring Revenue Business Model We have built a strong and long-standing portfolio of top tier financial institution, merchant, corporate and government customers across Latin America and the Caribbean, which provide us with a reliable, recurring Table of Contents revenue base and powerful references that have helped us expand into new channels and geographic markets. Customers representing approximately 99% of our 2011 revenue continued to be customers in 2012, due to the mission-critical and embedded nature of the services provided and the high switching costs associated with these services. Our Payment Processing and Merchant Acquiring segments, as well as certain business lines representing the majority of our Business Solutions segment, generate recurring revenues that collectively accounted for approximately 87% of our total revenues in 2012. We receive recurring revenues from services based on our customers on-going daily commercial activity such as processing loans, hosting accounts and information on our servers, and processing everyday payments at grocery stores, gas stations and similar establishments. We generally provide these services under one to five year contracts, often with automatic renewals. We also provide a few project-based services that generate non-recurring revenues in our Business Solutions segment such as IT consulting for a specific project or integration. Additionally, we entered into a 15-year Master Services Agreement with Popular on September 30, 2010. We provide a number of critical payment processing and business solutions products and services to Popular and benefit from the bank s distribution network and continued support. Through our long-standing and diverse customer relationships, we are able to gain valuable insight into trends in the marketplace that allows us to identify new market opportunities. In addition, we believe the recurring nature of our business model provides us with significant revenue and earnings stability. Highly Scalable, End-to-End Technology Platform Our diversified business model is supported by our highly scalable, end-to-end technology platform which allows us to provide a full range of transaction processing services and develop and deploy a broad suite of technology solutions to our customers at low incremental costs and increasing operating efficiencies. We have spent over $130 million over the last five years on technology investments to continue to build the capacity and functionality of our platform and we have been able to achieve attractive economies of scale with flexible product development capabilities. We have a proven ability to seamlessly leverage our existing platforms to develop new products and services and expand in new markets. We believe that our platform will increasingly allow us to provide differentiated services to our customers and facilitate further expansion into new sales channels and geographic markets. Experienced Management Team with a Strong Track Record of Execution We have grown our revenue organically by introducing new products and services and expanding our geographic footprint throughout Latin America. We have a proven track record of creating value from operational and technology improvements and capitalizing on cross-selling opportunities. We have combined new leadership at EVERTEC, bringing many years of industry experience, with long-standing leadership at the operating business level. In 2012, Peter Harrington, former President of Latin America and Canada for First Data Corporation, joined our management team as our President and Chief Executive Officer. Also, in 2012, Philip Steurer, former Senior Vice President of Latin America for First Data Corporation, joined our management team as our Chief Operating Officer. Mr. Harrington and Mr. Steurer both have extensive experience managing and growing transaction processing businesses in Latin America as well as North America, Asia and Europe. In addition, we successfully executed our separation from Popular, transitioning EVERTEC from a division of a larger company to a stand-alone entity with public company best practices. Instrumental to this transition was our Chief Financial Officer Juan J. Rom n, former CFO of Triple-S Management, a publicly listed insurance company. Collectively our management team benefits from an average of over 20 years of industry experience and we believe they are well positioned to continue to drive growth across business lines and regions. Table of Contents Our Growth Strategy We intend to grow our business by continuing to execute on the following business strategies: Continue Cross-Sales to Existing Customers We seek to grow revenue by continuing to sell additional products and services to our existing merchant, financial institution, corporate and government customers. We intend to broaden and deepen our customer relationships by leveraging our full suite of end-to-end technology solutions. For example, we believe that there is significant opportunity to cross-sell our network services, ATM point-of-sale processing and card issuer processing services to our over 180 existing financial institution customers, particularly in markets outside of Puerto Rico. We will also seek to continue to cross-sell value added services into our existing merchant base of over 25,000 locations. Leverage Our Franchise to Attract New Customers in the Markets We Currently Serve We intend to attract new customers by leveraging our comprehensive product and services offering, the strength of our brand and our leading end-to-end technology platform. Furthermore, we believe we are uniquely positioned to develop new products and services to take advantage of our access to and position in markets we currently serve. For example, in markets we serve outside of Puerto Rico, we believe there is a significant opportunity to penetrate small to medium financial institutions with our products and services, as well as to penetrate governments with offerings such as EBT. Expand in the Latin American Region We believe there is substantial opportunity to expand our businesses in the Latin American region. We believe that we have a competitive advantage relative to U.S. competitors based on our ability to locally leverage our infrastructure, breadth of products and services as well as our first-hand knowledge of Latin American markets, language and culture. Significant growth opportunities exist in a number of large markets such as Colombia, M xico, Chile and Argentina. We also believe that there is an opportunity to provide our services to existing financial institution customers in other regions where they operate. Additionally, we continually evaluate our strategic plans for geographic expansion, which can be achieved through joint ventures, partnerships, alliances or strategic acquisitions. Develop New Products and Services Our experience with our customers provides us with insight into their needs and enables us to continuously develop new transaction processing services. We plan to continue growing our merchant, financial institution, corporate and government customer base by developing and offering additional value-added products and services to cross-sell along with our core offerings. We intend to continue to focus on these and other new product opportunities in order to take advantage of our leadership position in the transaction processing industry in the Latin American and Caribbean region. Our Business We offer our customers end-to-end products and solutions across the transaction processing value chain from a single source across numerous channels and geographic markets, as further described below. Merchant Acquiring According to the July 2013 Nilson Report, we are the largest merchant acquirer in the Caribbean and Central America and the seventh largest in Latin America based on total number of transactions. Our Merchant Table of Contents Acquiring business provides services to merchants at over 25,000 locations that allow them to accept electronic methods of payment such as debit, credit, prepaid and EBT cards carrying the ATH, Visa, MasterCard, Discover and American Express brands. Our full suite of merchant acquiring services includes, but is not limited to, the underwriting of each merchant s contract, the deployment and rental of POS devices and other equipment necessary to capture merchant transactions, the processing of transactions at the point-of-sale, the settlement of funds with the participating financial institution, detailed sales reports and customer support. In 2012, our Merchant Acquiring business processed over 280 million transactions. Our Merchant Acquiring business generated $71.9 million, or 20.3%, of total revenues and $35.1 million, or 26.3%, of total segment income from operations for the twelve months ended September 30, 2013. Payment Processing We are the largest card processor and network services provider in the Caribbean. We provide an innovative and diversified suite of payment processing services to blue chip regional and global corporate customers, government agencies, and financial institutions across Latin American and the Caribbean. These services provide the infrastructure technology necessary to facilitate the processing and routing of payments across the transaction processing value chain. At the point-of-sale, we sell transaction processing technology solutions, similar to the services in our Merchant Acquiring business, to other merchant acquirers to enable them to service their own merchant customers. We also offer terminal driving solutions to merchants, merchant acquirers (including our Merchant Acquiring business) and financial institutions, which provide the technology to securely operate, manage and monitor POS terminals and ATMs. We also rent POS devices to financial institution customers who seek to deploy them across their own businesses. We currently provide technology services for over 4,100 ATMs and over 104,000 POS terminals in the region and are continuously certifying new machines and devices to expand this reach. To connect the POS terminals to card issuers, we own and operate the ATH network, one of the leading ATM and PIN debit networks in Latin America. The ATH network connects the merchant or merchant acquirer to the card issuer and enables transactions to be routed or switched across the transaction processing value chain. The ATH network offers the technology, communications standards, rules and procedures, security and encryption, funds settlement and common branding that allow consumers, merchants, merchant acquirers, ATMs, card issuer processors and card issuers to conduct commerce seamlessly, across a variety of channels, similar to the services provided by Visa and MasterCard. The ATH network and processing businesses processed over one billion transactions in 2012. Over 70% of all ATM transactions and over 80% of all debit transactions in Puerto Rico are processed through the ATH network. To enable financial institutions, governments and other businesses to issue and operate a range of payment products and services, we offer an array of card processing and other payment technology services, such as internet and mobile banking software services, bill payment systems and EBT solutions. Financial institutions and certain retailers outsource to us certain card processing services such as card issuance, processing card applications, cardholder account maintenance, transaction authorization and posting, fraud and risk management services, and settlement. Our payment products include electronic check processing, automated clearing house ( ACH ), lockbox, online, interactive voice response and web-based payments through personalized websites, among others. We have been the only provider of EBT services to the Puerto Rican government since 1998, processing approximately $2.5 billion in volume annually. Our EBT application allows certain agencies to deliver government benefits to participants through a magnetic card system and serves over 840,000 active participants. Our Payment Processing business accounted for $97.9 million, or 27.6%, of total revenues and $53.6 million, or 40.2%, of total segment income from operations for the twelve months ended September 30, 2013. Table of Contents Business Solutions We provide our financial institution, corporate and government customers with a full suite of business process management solutions including specifically core bank processing, network hosting and management, IT consulting services, business process outsourcing, item and cash processing, and fulfillment. In addition, we believe we are the only non-bank provider of cash processing services to the U.S. Federal Reserve in the Caribbean. Our Business Solutions business accounted for $185.0 million, or 52.1%, of total revenues and $44.7 million, or 33.5%, of total segment income from operations for the twelve months ended September 30, 2013. Initial Public Offering and Secondary Offering On April 17, 2013, we completed our initial public offering of 28,789,943 shares of common stock at a price to the public of $20.00 per share. A total of 6,250,000 shares were offered by us and a total of 22,539,943 shares were offered by selling stockholders, of which 13,739,284 shares were sold by an affiliate of Apollo Global Management, LLC and 8,800,659 shares were sold by Popular. We used the net proceeds of approximately $117.4 million from our sale of shares in the initial public offering and proceeds from borrowings under the 2013 Credit Agreement (as defined below), together with available cash on hand, to redeem our 11.0% senior notes due 2018 (the senior notes ) and to refinance our previous senior secured credit facilities. On September 18, 2013, we completed a public offering of 23,000,000 shares of our common stock by Apollo, Popular, and current and former employees at a price to the public of $22.50 per share. We did not receive any proceeds from the offering. After the completion of the offering, Apollo owned approximately 9.2 million shares of our common stock, or 11.2%, and Popular owned approximately 17.5 million shares of our common stock, or 21.3%.
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+This summary highlights information contained elsewhere in this prospectus and may not contain all the information that is important to you. The Royalty Trust urges you to read carefully this prospectus in its entirety. The Merger On June 3, 2013, Freeport-McMoRan Copper & Gold Inc., a Delaware corporation ( FCX ) and McMoRan Exploration Co., a Delaware corporation ( MMR ) completed the transactions contemplated by the Agreement and Plan of Merger, dated as of December 5, 2012 (the merger agreement ), by and among MMR, FCX, and INAVN Corp., a Delaware corporation and wholly owned subsidiary of FCX ( Merger Sub ). Pursuant to the merger agreement, on June 3, 2013, Merger Sub merged with and into MMR, with MMR surviving the merger as a wholly owned subsidiary of FCX (the merger ). Each share of MMR common stock issued and outstanding immediately prior to the effective time of the merger, other than any dissenting shares or shares held by FCX and any of its subsidiaries (including any shares acquired in connection with the consummation of the acquisition of Plains Exploration & Production Company (the PXP merger )), was converted into the right to receive $14.75 in cash, without interest and 1.15 units (the royalty trust units ) representing beneficial interests in Gulf Coast Ultra Deep Royalty Trust (the Royalty Trust ). Holders of royalty trust units will be entitled to share in a 5% gross overriding royalty interest in hydrocarbons saved and produced from MMR s existing shallow water Gulf of Mexico and onshore Gulf Coast ultra-deep exploration prospects. As of the date of this prospectus, none of the subject interests associated with the royalty trust units had any reserves classified as proved, probable or possible (other than MMR s onshore Lineham Creek well) and none of such subject interests had any associated production. The Royalty Trust The Bank of New York Mellon Trust Company, N.A., as Trustee Institutional Trust Services 919 Congress Avenue, Suite 500 Austin, Texas 78701 (713) 483-6792 The Royalty Trust is a statutory trust created by FCX under the Delaware Statutory Trust Act pursuant to a trust agreement entered into on December 18, 2012, between FCX, as depositor, Wilmington Trust, National Association, as Delaware trustee and certain officers of FCX, as regular trustees. The Royalty Trust was created to hold certain overriding royalty interests (the royalty interests ) in hydrocarbons saved and produced from MMR s shallow water Gulf of Mexico and onshore Gulf Coast ultra-deep exploration prospects (the subject interests ). MMR owns less than 100% of the working interest in each of the subject interests. On May 29, 2013, Wilmington Trust, National Association, was replaced by BNY Trust of Delaware, as Delaware trustee, through an action of the depositor. Effective June 3, 2013, the regular trustees were replaced by The Bank of New York Mellon Trust Company, N.A., as trustee. On June 3, 2013, in connection with the closing of the merger, a subsidiary of MMR conveyed the overriding royalty interests to the Royalty Trust. Since 2008, MMR s ultra-deep drilling activities (below the salt weld, i.e., the listric fault) have confirmed MMR s geologic model and the highly prospective nature of this emerging geologic trend. The subject interests remain exploration concepts and further drilling and flow testing will be required to determine the commercial potential of the subject interests. AS OF THE DATE OF THIS PROSPECTUS, NONE OF THE SUBJECT INTERESTS ASSOCIATED WITH THE ROYALTY TRUST UNITS HAD ANY RESERVES CLASSIFIED AS PROVED, PROBABLE OR POSSIBLE (OTHER THAN THE LINEHAM CREEK WELL), AND NONE Table of Contents INTRODUCTORY NOTE This Amendment No. 1 to the Registration Statement on Form S-1 (File No. 333-189043) relates to the delivery by McMoRan Oil & Gas LLC ( MOXY ), a subsidiary of Freeport-McMoRan Copper & Gold Inc. ( FCX and together with MOXY, the selling securityholder ) of up to 38,805,688 units representing beneficial interests in the Gulf Coast Ultra Deep Royalty Trust (the royalty trust units ) to holders of the following outstanding convertible securities of McMoRan Exploration Co. ( MMR ) upon conversion: 5 1/4% convertible senior notes due 2013 (the 2013 notes ); 4% convertible senior notes due 2017 (the 2017 notes ); 8% convertible perpetual preferred stock (the 8% preferred stock ); and 5.75% convertible perpetual preferred stock, Series 1 (the 5.75% preferred stock and together with the 2013 notes, the 2017 notes and the 8% preferred stock, the convertible securities ). On June 3, 2013, pursuant to the terms and conditions of the Agreement and Plan of Merger (the merger agreement ), dated as of December 5, 2012 by and among MMR, FCX, and INAVN Corp., a Delaware corporation and wholly owned subsidiary of FCX ( Merger Sub ), Merger Sub merged with and into MMR, with MMR surviving the merger as a wholly owned subsidiary of FCX (the merger ). At the effective time of the merger, each issued and outstanding share of MMR common stock (other than shares held by FCX, Merger Sub or any of their respective subsidiaries that were cancelled and holders who had perfected and not withdrawn a demand for appraisal rights) was converted into the right to receive $14.75 in cash and 1.15 royalty trust units (together, the merger consideration ). Pursuant to the convertible securities respective governing instruments, upon the consummation of the merger each series of the convertible securities became convertible into the type and amount of merger consideration paid in the merger to holders of MMR common stock, on an as-converted basis. As a result of this feature of the convertible securities, FCX, as the acquiror in the merger, will be obligated to deliver royalty trust units to the holders of the convertible securities in the future, at times and in amounts determined by such holders through their exercise of their conversion rights, and certain royalty trust units held by MOXY, a subsidiary of FCX, are available for this purpose. In addition, the 2017 notes, the 8% preferred stock and the 5.75% preferred stock are entitled to a make-whole premium due to the occurrence of the merger, which provides that any conversions of such securities exercised within a designated period following the merger will be made at an increased conversion rate, as set forth in their respective governing documents. Table of Contents OF SUCH SUBJECT INTERESTS HAD ANY ASSOCIATED PRODUCTION. The Royalty Trust has no ability to influence the exploration or development of the subject interests. In addition, FCX is under no obligation to fund or to commit any other resources to the exploration or development of the subject interests. Subject Interests The subject interests consist of 20 ultra-deep (target depths generally greater than 18,000 total vertical depth) prospects. The offshore subject interests consist of the following: (1) Barataria; (2) Barbosa; (3) Blackbeard East; (4) Blackbeard West; (5) Blackbeard West #3; (6) Bonnet; (7) Calico Jack; (8) Captain Blood; (9) Davy Jones; (10) Davy Jones West; (11) Drake; (12) England; (13) Hook; (14) Hurricane; (15) Lafitte; (16) Morgan; and (17) Queen Anne s Revenge. The onshore subject interests consist of the following: (1) Highlander; (2) Lineham Creek; and (3) Tortuga. All of the subject interests are located in relatively shallow waters offshore of the state of Louisiana, or onshore in Louisiana. MMR does not own 100% of the working interest of any of the subject interests. The 5% gross overriding royalty interests in hydrocarbons saved and produced from the subject interests burden all of MMR s current leasehold interests associated with such prospects, and will burden any leasehold interests associated with such prospects which are acquired by MMR on or before December 5, 2017. The gross overriding royalty interest applies only to MMR s working interest in each leasehold, as opposed to the working interest owned by any other interest owners in that leasehold subject to a cap equal to MMR s estimated working interest (equal to the working interest MMR owns or expects to acquire and as set forth in the section entitled Description of the Royalty Interests beginning on page 27) in each subject interest, on a prospect by prospect basis. As a result, each of the 5% gross overriding royalty interests has been, or will be, proportionately reduced based on MMR s working interest to equal the product of 5% multiplied by a fraction, the numerator of which is the working interest held by MMR and its affiliates in the applicable subject interest and the denominator of which is 100%. As of December 5, 2012, the date of the merger agreement, the subject interests comprised all of MMR s ultra-deep prospects and, as of the date of this prospectus, none of the subject interests had any reserves classified as proved, probable or possible (other than the Lineham Creek well) and none of the subject interests had any associated production. MMR s independent reserve engineers have assigned initial estimates of 12.9 Bcfe of net proved reserves, 46.6 Bcfe of net probable reserves and 82.2 Bcfe of net possible reserves, associated with interim drilling results through December 31, 2012, from the sands encountered above 24,000 feet in the Lineham Creek well, located on one of the onshore subject interests. Additional ultra-deep prospects developed by MMR will not be included in the subject interests. Royalty Trust Units Upon completion of the merger on June 3, 2013, each outstanding share of common stock of MMR (other than shares owned by FCX and its subsidiaries and shares held by stockholders who properly exercised dissenters rights) converted into the right to receive $14.75 in cash, without interest, and 1.15 royalty trust units, representing beneficial interests in the Royalty Trust, which holds a share in a 5% gross overriding royalty interest in hydrocarbons saved and produced from the subject interests during the life of the Royalty Trust. An overriding royalty interest in general represents a non-operating interest in an oil and gas property that provides the owner a specified share of production without any related operating expenses or development costs and is carved out of an oil and gas lessee s working or cost-bearing interest under the lease. A working or cost-bearing interest in general represents an operating interest in an oil and gas property that provides the owner a specified share of production that is subject to all production expense and development costs. An owner of a working or cost-bearing interest, subject to the terms of applicable operating agreements, generally has the right to participate in the selection of a prospect, drilling location, or drilling contractor to propose the drilling of a well, to determine the timing and sequence of drilling operations, to commence or shut down production, to take over operations, or to share in any operating decision. An owner of an overriding royalty interest in general has none of the rights described in the preceding sentence, and holders of royalty trust units will not have such rights. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY SUBJECT TO COMPLETION DATED JUNE 5, 2013 Gulf Coast Ultra Deep Royalty Trust 38,805,688 Royalty Trust Units This prospectus relates to the delivery by McMoRan Oil & Gas LLC ( MOXY ), a subsidiary of Freeport-McMoRan Copper & Gold Inc. ( FCX and together with MOXY, the selling securityholder ) of up to 38,805,688 royalty trust units to holders of the following convertible securities of McMoRan Exploration Co. ( MMR ) upon conversion: 5 1/4% convertible senior notes due 2013; 4% convertible senior notes due 2017; 8% convertible perpetual preferred stock and 5.75% convertible perpetual preferred stock, Series 1 (collectively, the convertible securities ). Neither the selling securityholder nor Gulf Coast Ultra Deep Royalty Trust (the Royalty Trust ) will receive any proceeds from this offering. The Royalty Trust Units. The royalty trust units represent beneficial interests in the Royalty Trust, which holds a 5% gross overriding royalty interest in hydrocarbons saved and produced from each of the subject interests (as defined below) during the life of the Royalty Trust. The royalty trust units are not currently listed on a national securities exchange. The royalty trust units are expected to be quoted on the OTCQX Marketplace (the OTCQX ). On June 3, 2013, the Royalty Trust issued 230,172,696 royalty trust units. Of this amount, 129,210,542 royalty trust units were issued to former holders of MMR common stock as merger consideration, and the remaining 100,962,154 royalty trust units are held by the selling securityholder, including 38,805,688 royalty trust units (approximately 16.9% of the total number of royalty trust units outstanding), which FCX may become obligated to deliver to holders of the convertible securities upon conversion. FCX is currently the largest holder of royalty trust units with approximately 43.9% of the outstanding royalty trust units. The Royalty Trust Unitholders. Holders of royalty trust units are entitled to share in a 5% gross overriding royalty interest in hydrocarbons saved and produced from 20 of MMR s specified shallow water Gulf of Mexico and onshore Gulf Coast ultra-deep exploration prospects. An overriding royalty interest in general represents a non-operating interest in an oil and gas property that provides the owner a specified share of production without any related operating expenses or development costs and is carved out of an oil and gas lessee s working or cost-bearing interest under the lease. The Subject Interests. The subject interests consist of 20 ultra-deep (target depths generally greater than 18,000 total vertical depth) prospects. The offshore subject interests consist of the following: (1) Barataria; (2) Barbosa; (3) Blackbeard East; (4) Blackbeard West; (5) Blackbeard West #3; (6) Bonnet; (7) Calico Jack; (8) Captain Blood; (9) Davy Jones; (10) Davy Jones West; (11) Drake; (12) England; (13) Hook; (14) Hurricane; (15) Lafitte; (16) Morgan; and (17) Queen Anne s Revenge. The onshore subject interests consist of the following: (1) Highlander; (2) Lineham Creek; and (3) Tortuga. All of the subject interests are located in relatively shallow waters offshore of the state of Louisiana, or onshore in Louisiana. MMR does not own 100% of the working interest of any of the subject interests. As of December 5, 2012, the date of the merger agreement, the subject interests comprised all of MMR s ultra-deep prospects and, as of the date of this prospectus, none of the subject interests had any reserves classified as proved, probable or possible (other than the Lineham Creek well) and none of the subject interests had any associated production. Investing in royalty trust units involves risks that are described in the Risk Factors section beginning on page 12 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2013. Table of Contents Unlike royalty interests that are retained by the mineral rights owner that grants the leasehold, an overriding royalty is generally granted to a party that does not own any interest in the underlying minerals, and the overriding royalty interest expires when production ceases and the lease terminates. For more information, see the section entitled Description of the Royalty Interests beginning on page 27. The Royalty Trust will dissolve on the earliest of: (i) June 3, 2033, (ii) the sale of all of the overriding royalty interests by the Royalty Trust, (iii) a vote in favor of termination by the holders of the required percentage of the royalty trust units, (iv) upon the election of the Trustee following its resignation for cause (as more fully described in the amended and restated trust agreement) or (v) the exercise by FCX of the right to call all of the royalty trust units described in the following sentence. FCX has the right to call all of the royalty trust units beginning on June 3, 2018 at a price of $10 per royalty trust unit, or, if the applicable trading price of the royalty trust units falls below $0.25 per unit for a nine-month period, at a price of $0.25 per royalty trust unit. The royalty interests terminate upon the termination of the Royalty Trust, other than in certain limited circumstances where the Royalty Trust has been permitted to transfer the royalty interests to a third party pursuant to the terms of the amended and restated trust agreement (in which case the royalty interests may extend through June 3, 2033). As of the date of this prospectus, none of the subject interests had any reserves classified as proved, probable or possible (other than MMR s onshore Lineham Creek well) and none of the subject interests had any associated production. MMR s independent reserve engineers have assigned initial estimates of 12.9 Bcfe of net proved reserves, 46.6 Bcfe of net probable reserves and 82.2 Bcfe of net possible reserves, associated with interim drilling results through December 31, 2012, from the sands encountered above 24,000 feet in the Lineham Creek well, located on one of the onshore subject interests. On June 3, 2013, the Royalty Trust issued 230,172,696 royalty trust units. Of this amount, 129,210,542 royalty trust units were issued to former holders of MMR common stock as merger consideration, and the remaining 100,962,154 royalty trust units are held by the selling securityholder, including 38,805,688 royalty trust units (approximately 16.9% of the total number of royalty trust units outstanding) which FCX may become obligated to deliver to holders of the convertible securities upon conversion. FCX is currently the largest holder of royalty trust units, with approximately 43.9% of the outstanding royalty trust units. U.S. Federal Income Tax Considerations A conversion of convertible securities into royalty trust units and cash will be a fully taxable transaction for United States federal income tax purposes and may also be taxable for state, local and foreign tax purposes. The selling securityholder and the Royalty Trust urge you to consult your own tax advisor regarding the federal, state, local and foreign tax consequences of conversion to you in your particular circumstances. Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/NRG_nrg_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/NRG_nrg_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/NRG_nrg_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/ORMP_oramed_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/ORMP_oramed_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..f78b6ab35ed8c073bfe2496df59332880e2630b6
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/ORMP_oramed_prospectus_summary.txt
@@ -0,0 +1,1023 @@
+Prospectus Summary, our common stock is quoted on the OTCQB under the symbol ORMP. We have applied to have our common stock listed on Nasdaq, and we currently expect such listing to be approved in February 2013.
+
+ 
+
+ 
+
+51
+
+ 
+
+ 
+
+SELLING STOCKHOLDERS
+
+ 
+
+The selling stockholders acquired the securities being registered for resale pursuant to this prospectus in private placement transactions, as remuneration for services rendered and/or as equity compensation, as detailed below:
+
+ 
+
+On June 15, 2007, we issued to certain selling stockholders in a private placement, 300,000 units of our securities at a price of $6.00 per unit for aggregate proceeds of $1,800,000. Each unit consisted of one share of our common stock and one three-year warrant, each warrant exercisable into one share of our common stock at an exercise price of $9.00 per share. These warrants expired on June 15, 2010.
+
+ 
+
+On August 2, 2007, we issued to certain selling stockholders in a private placement, 42,500 units at a purchase price of $6.00 per unit for aggregate proceeds of $255,000. Each unit consisted of one share of our common stock and one three-year warrant, each warrant exercisable into one share of our common stock at an exercise price of $9.00 per share. These warrants expired on August 2, 2010. We also issued 834 shares of our common stock to Shikma A M R Ltd as a finder s fee.
+
+ 
+
+On July 14, 2008, we entered into a securities purchase agreement with certain selling stockholders pursuant to which we sold to such selling stockholders an aggregate of 710,389 shares of our common stock at a purchase price of $7.20 per share. Such selling stockholders also received three-year warrants to purchase an aggregate of 355,195 shares of common stock at an exercise price of $10.80 per share. These warrants expired on July 14, 2011.
+
+ 
+
+On August 14, 2007, we granted to Dr. Miriam Kidron, our Chief Medical and Technology Officer and a director, a warrant to purchase up to 280,114 shares of our common stock at an exercise price of $.012 per share; the warrant vested immediately and had an expiration date of December 31, 2012. On August 8, 2012, our Board resolved to extend the term of Dr. Kidron s warrant until August 6, 2014. We are also including for resale pursuant to this prospectus 186,000 shares of common stock issuable upon the exercise of options held by Dr. Kidron. The warrant and options have a weighted average exercise price of $5.52 per share
+and may be exercised within 60 days of January 29, 2013. The latest expiration date of the options is August 8, 2022.
+
+ 
+
+In March 2011, we completed a private placement with certain selling stockholders pursuant to which we sold an aggregate of 873,961 units at a purchase price of $3.84 per unit for total consideration of $3,356,000. Each unit consisted of one share of common stock and a five-year warrant to purchase 0.35 of a share of common stock at an exercise price of $6.00 per share. We also issued 16,397 shares of common stock and warrants to purchase 5,906 shares of our common stock as finders fees in connection with the private placement. These amounts include the sale to D.N.A of 65,105 shares of our common stock and warrants to purchase up to 22,787 shares of our common stock, for a total
+purchase price of $250,000 in cash.
+
+ 
+
+In April 2011, we completed a private placement with certain selling stockholders pursuant to which we sold an aggregate of 93,701 units at a purchase price of $3.84 per unit for total consideration of $359,800. Each unit consisted of one share of common stock and a five-year warrant to purchase 0.35 of a share of common stock at an exercise price of $6.00 per share.
+
+ 
+
+Between August and November 2012, we completed private placements pursuant to which we sold to certain selling stockholders an aggregate of 1,137,336 units at a purchase price of $4.44 per unit for total consideration of $5,049,710. Each unit consisted of one share of our common stock and a five-year warrant to purchase 0.50 of a share of our common stock at an exercise price of $6.00 per share. We paid cash compensation of $76,635 and might be required to pay additional cash compensation of $7,500 as a finder s fee. We also issued 1,127 shares of our common stock and warrants to purchase 564
+shares of our common stock as a finder s fee to a third party in connection with the private placements and will issue 12,745 shares of our common stock and warrants to purchase 6,373 shares of our common stock as a finder s fee to Mr. Leonard Sank, one of our directors. Most of the selling stockholders were granted customary registration rights with respect to resales of shares, including the shares underlying the warrants. Regals participated in such private placements and received certain special rights, including preemptive rights as long as they hold at least 5% of our outstanding common stock. With respect to Regals participation in the August 2012 private placement, we undertook to file a registration statement to register their shares and the shares underlying their warrants, by December 27, 2012. Since such
+registration statement was not timely filed, we may be required to pay liquidated damages of $10,000 or, at Regals discretion, 27,027 shares of common stock. Such liquidated damages may increase if we do not meet the Effectiveness Deadline as defined in Regals agreement. The liquidated damages may not exceed, in the aggregate, $100,000. Regals has not notified us that they plan to request such payment, and such damages may be waived by Regals.
+
+ 
+
+ 
+
+52
+
+ 
+
+ 
+
+In October 2012, we entered into a Securities Purchase Agreement with D.N.A, according to which, we issued to D.N.A 199,172 shares of our common stock in consideration for the D.N.A Warrant. Mr. Zeev Bronfeld, a controlling shareholder of D.N.A, beneficially owned 7.1% of our outstanding common stock prior to the transaction.
+
+ 
+
+In November 2012, we entered into the Agreement with Regals in connection with the Warrants. Pursuant to the Agreement, we and Regals agreed to amend the Warrants to provide that the anti-dilution protection of the Warrants shall be deleted in its entirety. In addition, as to the warrants issued in August and November 2012, the parties agreed to reduce the exercise price to $3.7656 per share, the current exercise price per share of the warrants originally issued to Regals in January 2011. At such time, we also issued the New Warrant.
+
+ 
+
+We are also including for resale pursuant to this prospectus 186,000 shares of common stock issuable upon the exercise of options held by Mr. Nadav Kidron, our President, Chief Executive Officer and a director. The options have a weighted average exercise price of $5.76 per share and may be exercised within 60 days of January 29, 2013. The latest expiration date of the options is August 8, 2022.
+
+ 
+
+The following table sets forth, for each selling stockholder, the name, the number of shares of common stock beneficially owned as of January 29, 2013 (directly and indirectly via warrants or options), the maximum number of shares of common stock that may be offered pursuant to this prospectus and the number of shares of common stock that would be beneficially owned after the sale of the maximum number of shares of common stock.
+
+Other than the relationships described herein, to our knowledge, none of the selling stockholders are employees or suppliers of ours or our affiliates. Within the past three years, other than the relationships described herein, none of the selling stockholders has held a position as an officer or director of ours, nor has any selling stockholder had any material relationship of any kind with us or any of our affiliates, except that certain selling stockholders acquired shares of our common stock and warrants pursuant to the transactions described above. All information with respect to share ownership has been furnished by the selling stockholders, unless otherwise noted. The shares being
+offered are being registered to permit public secondary trading of such shares and each selling stockholder may offer all or part of the shares it owns for resale from time to time pursuant to this prospectus. In addition, other than the relationships described below, none of the selling stockholders has any family relationships with our officers, directors or controlling stockholders.
+
+Any selling stockholders who are affiliates of broker-dealers and any participating broker-dealers are deemed to be underwriters within the meaning of the Securities Act, and any commissions or discounts given to any such selling stockholder or broker-dealer may be regarded as underwriting commissions or discounts under the Securities Act.
+
+The term selling stockholders also includes any transferees, pledgees, donees, or other successors in interest to the selling stockholders named in the table below. Unless otherwise indicated, to our knowledge, each person named in the table below has sole voting and investment power (subject to applicable community property laws) with respect to the shares of common stock set forth opposite such person s name. We will file a supplement to this prospectus (or a post-effective amendment hereto, if necessary) to name successors to any named selling stockholders who are able to use this prospectus to resell the securities registered hereby.
+
+ 
+
+ 
+
+53
+
+ 
+
+ 
+
+Name of Selling 
+
+Stockholder
+
+Shares Beneficially 
+
+Owned Before the 
+
+Offering (excluding 
+
+shares issuable upon 
+
+the exercise of warrants 
+
+or options) (1)
+
+Shares Beneficially Owned 
+
+Before the Offering that are Issuable Upon the Exercise of Warrants or Options (1)
+
+Maximum Number of 
+
+Shares (including shares 
+
+issuable upon the exercise of 
+
+warrants or options) to be 
+
+Offered in the Offering
+
+Number of Shares 
+
+(including shares issuable upon the exercise of warrants or options)
+
+Beneficially Owned Immediately After Sale of Maximum 
+
+Number of 
+
+Shares in the Offering
+
+ 
+
+# of Shares (2)
+
+ 
+
+% of Class (1)(2)
+
+Leonard Sank (3)
+
+230,255
+
+51,892
+
+245,398
+
+36,749
+
+*
+
+Dorothy Sank (3)
+
+78,125
+
+27,344
+
+105,469
+
+--
+
+--
+
+Samson Property Investments (3)
+
+138,889
+
+-
+
+138,889
+
+--
+
+--
+
+Michael Pimstein (4)
+
+20,834
+
+7,292
+
+28,126
+
+--
+
+--
+
+David Bloch (4)
+
+2,605
+
+912
+
+3,517
+
+--
+
+--
+
+Laurie Rubin
+
+36,667
+
+-
+
+36,667
+
+-
+
+-
+
+Mirabaud & CIE
+
+13,889
+
+--
+
+13,889
+
+ --
+
+--
+
+Joan Samson
+
+13,889
+
+-
+
+13,889
+
+--
+
+--
+
+Vered Schimmel
+
+8,334
+
+-
+
+8,334
+
+ --
+
+--
+
+Shikma A M R Ltd
+
+9,167
+
+-
+
+9,167
+
+ --
+
+--
+
+Edward Danehy
+
+9,167
+
+-
+
+9,167
+
+--
+
+--
+
+Oberdorf Finance SA
+
+6,667
+
+--
+
+6,667
+
+ --
+
+--
+
+Pnini David Jerusalem
+
+6,959
+
+-
+
+6,959
+
+ --
+
+--
+
+David Lifscitz
+
+5,834
+
+-
+
+5,834
+
+--
+
+--
+
+Elhanan Noam Enterprising Ltd.
+
+8,554
+
+--
+
+8,554
+
+--
+
+--
+
+Lawrence Leigh
+
+3,473
+
+-
+
+3,473
+
+--
+
+--
+
+Ryan Lazarus
+
+3,334
+
+-
+
+3,334
+
+--
+
+--
+
+Aviad Freidman
+
+5,299
+
+591
+
+5,890
+
+--
+
+--
+
+Nadav Kidron (5)
+
+864,312
+
+189,000
+
+1,053,312
+
+--
+
+--
+
+Zeev Bronfeld (6)
+
+475,227
+
+--
+
+475,227
+
+--
+
+--
+
+Hadasit Medical Research Services and Development Ltd. (7)
+
+345,128
+
+--
+
+345,128
+
+--
+
+--
+
+Russel Leigh
+
+58,334
+
+--
+
+58,334
+
+--
+
+--
+
+Regals Fund LP (8)
+
+760,640
+
+557,274
+
+1,317,914
+
+--
+
+--
+
+Vivid Horizon Limited
+
+119,792
+
+48,178
+
+167,970
+
+--
+
+--
+
+Novatrust Ltd re Clifton Two Trust
+
+35,544
+
+15,819
+
+51,363
+
+--
+
+--
+
+Lashmar Holdings Inc
+
+56,250
+
+19,688
+
+75,938
+
+--
+
+--
+
+ 
+
+ 
+
+54
+
+ 
+
+ 
+
+Name of Selling 
+
+Stockholder
+
+Shares Beneficially 
+
+Owned Before the 
+
+Offering (excluding 
+
+shares issuable upon 
+
+the exercise of warrants 
+
+or options) (1)
+
+Shares Beneficially Owned 
+
+Before the Offering that are Issuable Upon the Exercise of Warrants or Options (1)
+
+Maximum Number of 
+
+Shares (including shares 
+
+issuable upon the exercise of 
+
+warrants or options) to be 
+
+Offered in the Offering
+
+Number of Shares 
+
+(including shares issuable upon the exercise of warrants or options)
+
+Beneficially Owned Immediately After Sale of Maximum 
+
+Number of 
+
+Shares in the Offering
+
+ 
+
+# of Shares (2)
+
+ 
+
+% of Class (1)(2)
+
+ICT NV
+
+39,063
+
+13,672
+
+52,735
+
+--
+
+--
+
+Marcel Kremer
+
+13,021
+
+4,724
+
+17,745
+
+--
+
+--
+
+Vladimir Shklar
+
+8,632
+
+591
+
+9,223
+
+--
+
+--
+
+D.N.A Biomedical Solutions Ltd. (6)
+
+199,172
+
+22,787
+
+22,787
+
+199,172
+
+2.8%
+
+Ron Weissberg
+
+10,105
+
+4,558
+
+14,663
+
+--
+
+--
+
+S.Brimer Investments and Consulting
+
+13,021
+
+4,558
+
+17,579
+
+--
+
+--
+
+Abramovich Yehoshua
+
+13,021
+
+4,558
+
+17,579
+
+--
+
+--
+
+Amir Fishler
+
+3,334
+
+1,167
+
+4,501
+
+--
+
+--
+
+Shmuel Pasternak
+
+11,719
+
+4,102
+
+15,821
+
+--
+
+--
+
+DSN Holdings Ltd
+
+--
+
+1,459
+
+1,459
+
+--
+
+--
+
+Daniel Younisian
+
+25,000
+
+8,750
+
+33,750
+
+--
+
+--
+
+Boaz Raam
+
+--
+
+2,279
+
+2,279
+
+--
+
+--
+
+Yael Berant
+
+3,907
+
+1,368
+
+5,275
+
+--
+
+--
+
+Beeston Nominees (Panama) Inc.
+
+326,577
+
+163,289
+
+489,866
+
+--
+
+--
+
+Jacar Nominees PTY Ltd as Trustees for Sank Super
+
+11,262
+
+5,631
+
+16,893
+
+--
+
+--
+
+Roxy Pty Ltd Atf Dak Trust
+
+5,631
+
+2,816
+
+8,447
+
+--
+
+--
+
+Vingol Pty Ltd
+
+5,631
+
+2,816
+
+8,447
+
+--
+
+--
+
+Rak Investments Pty Ltd
+
+5,667
+
+2,834
+
+8,501
+
+--
+
+--
+
+B+E Lewin Investments Pty Ltd
+
+5,631
+
+2,816
+
+8,447
+
+--
+
+--
+
+Fabian Cove Pty. Ltd.
+
+5,631
+
+2,816
+
+8,447
+
+--
+
+--
+
+S.N. LE ROUX
+
+67,568
+
+33,784
+
+101,352
+
+--
+
+--
+
+ARC Securities BVI Ltd
+
+67,568
+
+33,784
+
+101,352
+
+--
+
+--
+
+Sanur Ltd as Trustees of Arigus Trust
+
+11,269
+
+5,635
+
+16,904
+
+--
+
+--
+
+Joshriel Pty Ltd
+
+5,652
+
+2,826
+
+8,478
+
+--
+
+--
+
+Norrin Imports Staff Benefit Fund
+
+22,523
+
+11,262
+
+33,785
+
+--
+
+--
+
+David Steynberg
+
+12,797
+
+5,631
+
+18,428
+
+--
+
+--
+
+Isaac Benatar
+
+11,262
+
+5,631
+
+16,893
+
+--
+
+--
+
+Hero Nominees Limited A/C POOLED
+
+22,523
+
+11,262
+
+33,785
+
+--
+
+--
+
+Jeffrey Laurence Borstrock
+
+22,500
+
+11,250
+
+33,750
+
+--
+
+--
+
+David J. Fogel
+
+17,500
+
+8,750
+
+26,250
+
+--
+
+--
+
+Yael Choukroun
+
+3,380
+
+1,690
+
+5,070
+
+--
+
+--
+
+Esther Tavor
+
+3,380
+
+1,690
+
+5,070
+
+--
+
+--
+
+Martin Kornblum
+
+11,262
+
+5,631
+
+16,893
+
+--
+
+--
+
+David Mendelson
+
+11,262
+
+5,631
+
+16,893
+
+--
+
+--
+
+Michael G. Jesselson 12/18/80 Trust
+
+56,307
+
+28,154
+
+84,461
+
+--
+
+--
+
+Benjamin J. Jesselson 12/18/80 Trust
+
+56,307
+
+28,154
+
+84,461
+
+--
+
+--
+
+Yair Givati
+
+1,127
+
+564
+
+1,691
+
+--
+
+--
+
+Miriam Kidron (9)
+
+--
+
+469,114
+
+469,114
+
+--
+
+--
+
+Total
+
+4,427,380
+
+1,846,024
+
+6,037,483
+
+235,921
+
+3.2%
+
+ 
+
+* Less than 1%.
+
+ 
+
+ 
+
+55
+
+ 
+
+ 
+
+_________________
+
+ 
+
+(1) Beneficial ownership is determined in accordance with SEC rules and generally includes voting or investment power with respect to securities. Shares of common stock subject to options or warrants currently exercisable, or exercisable within 60 days of January 29, 2013, are counted as outstanding for computing the percentage of the selling stockholder holding such options or warrants but are not counted as outstanding for computing the percentage of any other selling stockholder.
+
+ 
+
+(2) Assumes all of the shares of common stock offered (including shares issuable upon the exercise of warrants or options) are sold. Percentage ownership is based on 7,209,652 shares of common stock issued and outstanding on January 29, 2013.
+
+ 
+
+(3) Mr. Leonard Sank is one of our directors. Mr. Sank may be deemed to beneficially own the shares (including the warrant shares) held by his wife, Mrs. Dorothy Sank, set forth opposite her name. Mr. Sank also may be deemed to beneficially own the shares set forth opposite the name of Samson Property Investments, which is wholly owned by a trust of which Mr. Sank serves as a trustee. Mr. Sank disclaims beneficial ownership of all such securities. These securities are held of record by Hargreave Hale Nominees Limited on behalf of Mr. Sank, except for 47,673 shares held of record by Mr. Sank.
+
+ 
+
+(4) These shares are held of record by Apollo Nominees Inc. on behalf of David Bloch and Michael Pimstein.
+
+ 
+
+(5) Mr. Nadav Kidron is our President, Chief Executive Officer and one of our directors. He is the son of Dr. Miriam Kidron, our Chief Medical and Technology Officer and one of our directors.
+
+ 
+
+(6) The amount of shares beneficially owned by Mr. Bronfeld does not include the 199,172 shares of common stock and warrants to purchase 22,787 shares of common stock held by D.N.A. Mr. Bronfeld and Mr. Meni Mor are parties to a voting agreement relating to their joint holdings in D.N.A, which as of December 27, 2012, represented approximately 39.6% of D.N.A s outstanding share capital on an actual basis, as reported by D.N.A to the ISA. As a result, Mr. Bronfeld may be deemed a beneficial owner of, and to share the power to vote and dispose of our securities held by D.N.A. Mr. Bronfeld has
+disclaimed beneficial ownership of any of our securities held by D.N.A. Immediately prior to the October 2012 issuance of shares to D.N.A, Mr. Bronfeld beneficially owned 7.1% of our shares common stock. The foregoing is based on a Schedule 13G/A filed by Mr. Bronfeld on January 19, 2012 and on subsequent information available to the Company. In addition, should we exercise the D.N.A Warrant, we will hold approximately 14.5% of D.N.A s ordinary shares.
+
+(7) See Certain Relationships and Related Transactions, and Director Independence for a description of the terms and conditions of our relationship with Hadasit.
+
+ 
+
+(8) Regals Capital
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/PSIX_power_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/PSIX_power_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/PSIX_power_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/SVRA_savara-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/SVRA_savara-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a0ddbca5f7a29bfe817cf89852ffa708c4fe234c
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/SVRA_savara-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before making an investment decision with respect to our securities. You should read the entire prospectus carefully, including the Risk Factors section beginning on page 4 of this prospectus, our financial statements and related notes appearing at the end of this prospectus, and other information contained in this prospectus, before making an investment decision with respect to our securities. Unless the context indicates otherwise, all references to we , us , our , Mast , or the Company refer to Mast Therapeutics, Inc. and its subsidiaries. Overview We are a biopharmaceutical company developing novel therapies for serious or life-threatening diseases with significant unmet needs. We are leveraging our Molecular Adhesion & Sealant Technology, or MAST, platform, derived from over two decades of clinical, nonclinical and manufacturing experience with purified and non-purified poloxamers, to develop MST-188 for diseases and conditions characterized by microcirculatory insufficiency (endothelial dysfunction and/or impaired blood flow). We believe the pharmacologic effects of MST-188 support its development in more than one setting and we intend to develop MST-188 in multiple clinical indications, both independently and through collaborations. In January 2013, we initiated EPIC (Evaluation of Purified 188 In Children), a pivotal phase 3 study of MST-188 in sickle cell disease. In February 2013, we announced our plans to develop MST-188 for complications of arterial disease, initially as an adjunct to thrombolytics in acute limb ischemia, and that in late 2013 or early 2014 we intend to initiate a phase 2, clinical proof-of-concept study to evaluate the safety and efficacy of MST-188 in this indication. Additionally, we are conducting or plan to conduct nonclinical studies to investigate the safety and/or efficacy of MST-188 in additional indications, including acute decompensated heart failure and blood transfusion. We also are conducting nonclinical studies that will evaluate the effect of MST-188 on blood coagulation, which may support further development in resuscitation of shock following major trauma. However, even if these nonclinical studies are positive, it is unlikely we will initiate clinical studies in these indications without a strategic collaboration or funding from the U.S. government. We may evaluate MST-188 in other conditions in which its pharmacologic effects may translate into improved clinical outcomes. Over the past several years, we have changed fundamentally our priorities, personnel and business focus. In 2009, substantially all of the business operations of our company had been suspended and there were only two employees. A restructuring process was implemented that year and, as a result, we now have a substantially new board of directors and management team, which terminated development of our prior reformulated chemotherapeutic programs, raised capital to fund our current strategic direction, acquired MST-188 and focused our resources on its development, and managed substantial internal growth. To reflect this fundamental change in our company, effective March 11, 2013, we changed our name from ADVENTRX Pharmaceuticals, Inc. to Mast Therapeutics, Inc. We are a development-stage company and have not yet marketed or sold any products or generated any significant revenue. Business Strategy Our goal is to be a successful biopharmaceutical company developing novel therapies for serious or life-threatening diseases with significant unmet needs. Near-term activities that underlie our business strategy include the following: Complete the phase 3 study and seek regulatory approval of MST-188 in sickle cell disease. One of our top priorities is enrolling subjects in our phase 3 study of MST-188 in sickle cell disease. Although predicting the rate of enrollment for EPIC is subject to a number of assumptions and the actual rate may differ materially, we expect to complete enrollment in 2015. If study results are positive, we plan to submit a new drug application, or NDA, to the U.S. Food and Drug Administration, or FDA, based in large part on the data from this study. Develop MST-188 for complications of arterial disease. Data from experimental models demonstrate the potential for MST-188, when used alone or in combination with thrombolytics, to improve outcomes in patients experiencing complications of arterial disease resulting from atherosclerotic and thromboembolic processes. We believe that, based on the similar pathophysiology of atherosclerotic arterial disease (plaque-obstructed arteries reducing the flow of blood to tissue), an agent that is effective in one form of occlusive arterial disease also may be effective in its other manifestations. Our strategy in arterial disease is first to demonstrate the utility of MST-188 in patients with acute limb ischemia, or ALI, an advanced form of atherosclerosis, where we believe the potential to demonstrate a treatment effect is greatest. By generating clinical proof-of-concept data in ALI, we believe we increase development and partnering opportunities in other forms of occlusive arterial disease. Our near-term goals include obtaining orphan drug designation for MST-188 for ALI, submitting to FDA a protocol for our planned phase 2, clinical proof-of-concept study in ALI, and initiating the phase 2 study in late 2013 or Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JUNE 14, 2013 PRELIMINARY PROSPECTUS 50,000,000 Units Mast Therapeutics, Inc. 50,000,000 Shares of Common Stock Warrants to Purchase up to 25,000,000 Shares of Common Stock $ per unit Mast Therapeutics, Inc. is offering 50,000,000 units with each unit consisting of one share of our common stock and one warrant to purchase 0.5 of a share of our common stock (and the shares of our common stock issuable from time to time upon exercise of the offered warrants). The last reported sale price of our common stock on June 12, 2013 was $0.62 per share. Each warrant will have an exercise price of $ per share, will be exercisable upon issuance and will expire years from the date of issuance. The units will not be issued or certificated. The shares of common stock and the warrants are immediately separable and will be issued separately, but will be purchased together in this offering. Trading Symbol: NYSE MKT MSTX This investment involves risk. See Risk Factors beginning on page 4. Per Unit Total Public offering price $ $ Underwriting discount $ $ Proceeds, before expenses, to us(1) $ $ (1) We have agreed to reimburse the underwriters for fees incurred by it in connection with this offering, up to a maximum of $150,000. See Underwriting beginning on page 89 of this prospectus. The underwriters have a 30-day option to purchase up to 7,500,000 additional units from us to cover over-allotments, if any. The underwriters expect to deliver the securities on or about , 2013. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Sole Book-Running Manager Piper Jaffray Lead Manager Canaccord Genuity The date of this prospectus is , 2013 Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2013/UCTT_ultra_prospectus_summary.txt b/parsed_sections/prospectus_summary/2013/UCTT_ultra_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2013/UCTT_ultra_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/ACRL_atacama_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/ACRL_atacama_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..c8201bcc4d63c4113a0c96c4c2f7a36124c551c8
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/ACRL_atacama_prospectus_summary.txt
@@ -0,0 +1,715 @@
+PROSPECTUS SUMMARY
+
+ 
+
+Summary Information, Risk Factors and Ratio of Earnings to Fixed Charges.
+
+This summary highlights certain information contained elsewhere in this prospectus. You should read the following summary together with the more detailed information regarding ARRAKIS MINING RESEARCH INC. ( Us, We, Our, AMRI, the Company, or the Corporation ) and our financial statements and the related notes appearing elsewhere in this prospectus. 
+
+The SEC has adopted penny stock regulations which apply to securities traded over-the-counter. These regulations generally define penny stock to be any equity security that has a market price of less than $5.00 per share or an equity security of an issuer with net tangible assets of less than $5,000,000 as indicated in audited financial statements, if the corporation has been in continuous operations for less than three years. Subject to certain limited exceptions, the rules for any transaction involving a penny stock require the delivery, prior to the transaction, of a risk disclosure document prepared by the SEC that contains certain information describing the nature and level of risk associated with investments in the penny stock market. The broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative and current quotations for the securities. Monthly account statements must be sent by the broker-dealer disclosing the estimated market value of each penny stock held in the account or indicating that the estimated market value cannot be determined because of the unavailability of firm quotes. In addition, the rules impose additional sales practice requirements on broker-dealers who sell such securities to persons other than established customers and institutional accredited investors (generally institutions with assets in excess of $5,000,000). These practices require that, prior to the purchase, the broker-dealer determined that transactions in penny stocks were suitable for the purchaser and obtained the purchaser s written consent to the transaction. If a market for our common stock does develop and our shares trade below $5.00 per share, it will be a penny stock. Consequently, the penny stock rules will likely restrict the ability of broker-dealers to sell our shares and will likely affect the ability of purchasers in the offering to sell our shares in the secondary market. Trading in our common stock will be subject to the penny stock rules. Due to the thinly traded market of these shares investors are at a much higher risk to lose all or part of their investment. Not only are these shares thinly traded but they are subject to higher fluctuations in price due to the instability of earnings of these smaller companies. As a result of the lack of a highly traded market in our shares investors are at risk of a lack of brokers who may be willing to trade in these shares.
+
+ The Company
+
+Our Business
+
+ 
+
+ARRAKIS MINING RESEARCH INC. (hereinafter AMRI ) is a company incorporated in the State of Florida in June 2013. We were formed as a consultant to the Mining industry. The Mining industry is subject to constant change due to market trends, thereby making it extremely competitive. The Mining industry is complex, because several segments are regulated by both federal and state/provincial governments. AMRI s approach is intended to assist our potential clients with general business operations with the growth and development, international expansion, including mergers & acquisitions, and financing aspects of their business, exposing our potential clients to a much wider international field of opportunities and perspectives.
+
+By using the services provided by AMRI, our clients are free to focus on compliance with regulations within their industry, and to complete their primary business goals.
+
+AMRI focuses on two main aspects of the consulting business: international expansion strategy, and financing. Our programs will be tailored to meet the needs and requests of our clients. We will assist our clients with growth by exposing them to international merger and acquisition opportunities as well as financing opportunities. 
+
+We will provide customized business strategies, based upon client preference, which may include any or all of the following:
+
+ 
+ 
+
+International and domestic corporate development strategies;
+
+ 
+ 
+
+ 
+ 
+
+Strategic and financial partnering;
+
+ 
+
+Mergers and acquisitions;
+
+In our CEO's present and past positions he is serving and has served as:
+
+ 
+
+President at Arrakis Mining & Minerals Corp. (2013-2013) an Ottawa, ON Canada based junior mining company involved in iron-sand mining projects in Chile
+
+ 
+
+Acting CEO at Lion King Resources Inc. (2011-2013) a Vancouver, BC, Canada based junior mining company involved in iron-sand mining projects in Chile
+
+5
+
+ 
+
+General Manager at LEON s Manufacturing Company Ltd. (2010-2011) a mature Yorkton, SK Canada based manufacturer of material handling equipment for the agricultural, construction, mining and other industries.
+
+ 
+
+General Manager, Global Operations for Canadian Rockport Homes Int l Inc. (2003-2009) a Vancouver, BC, Canada based company with a proprietary technology for the production of low cost modular factory built concrete homes. Its production facility and housing project was in Santiago Chile; Mr. Olsen was based there from 2005-2007.
+
+ 
+
+Partner with James Edward Capital Corporation (2003), an Ottawa, ON Canada based boutique merchant banking firm.
+
+ 
+
+Vice-President, Operations at MetroPhotonics (2001-2002), an Ottawa, Canada based start-up commercializing a proprietary photonic integrated circuit technology including operation of an InP wafer fab operations.
+
+ 
+
+Various Supply Chain Management positions with Nortel Networks (1990-2000), a Canadian based telecommunications equipment manufacturer with global reach.
+
+In our CEO's business history he has consulted on a number of projects and as a result, created a strong corporate history and respect in the mining industry. The rate charged for our services will be dependent upon the level of consulting services the client company is interested in utilizing and the complexity of the client company business. AMRI consulting fees will be negotiated and established based upon factors such as the level of services requested by the client. 
+
+Thus far we have marketed our services primarily to mining and mining development companies located in the United States of America (the U.S. ) and Canada. AMRI has been doing business since inception, June 2013. To date we have not secured any paying clients, however we are confident that with the relationships of our CEO, we will soon have paying clients. Originally formed to do any and all legal business, the intent of the corporation was to specialize in corporate development and growth management consultation. Ken Olsen, our president has been involved in the Company since inception and is the founder. We focus on geographic areas, projects and budget levels where we believe there are significant demand for our services and the potential for attractive returns to our Company and investors. We do not consider our Company to be a blank check company as such term is defined in Securities and Exchange Commission Rule 419; however, we are a company with minimal revenues and limited operations and our auditor has expressed substantial doubt about our ability to continue as a going concern. The Company is not a blank-check company and is not being formed for the purposes of a reverse merger or any other like transaction. The Company does now and will continue to operate as an advisory company, on a fee-based compensation basis, for independent clients requiring our expertise, experience and international contact networks. The Company s business plan is first and foremost designed to grow organically by obtaining clients by personal contact. However, as the opportunity present itself (to further our business plan with potential growth through the acquisition of specialty service providers and other independent consulting services companies) the Company will consider acquisitions to enhance all of the personal efforts. Any acquisitions that the Company may make in the future would be of companies similar in nature to our own, operating in similar or complementary industry segments or geographic location to enhance the Company with new growth opportunities and a competitive advantage. AMRI anticipates growth through the consolidation of consulting service providers, proprietary processes and small to mid-sized independent management consulting companies that operate in related industries. Our management has designed an aggressive but straightforward strategy to transition AMRI to a full service independent mining industry solutions provider in addition to our consulting with minimal risk to the existing operation.
+
+We believe that our conduct to date evidences significant, bona fide business operations and a scenario that is wholly inapposite to any attempt to create the mere appearance of a specific business plan and effort to avoid the application of Rule 419. 
+
+ Our general business strategy is to market our services to markets primarily in mining friendly regions of the United States of America. Our strategically located business development efforts are well positioned to benefit from the continuing need for our services. We recognize that current market conditions are extremely challenging. Accordingly, we have adapted our business plan and strategy with the goal of protecting liquidity, enhancing our balance sheet and positioning our Company for future growth when market conditions improve. In connection with this strategy, we have adopted a conservative approach and our principal business strategy is to utilize our sales expertise to: 
+
+ 
+
+sell consulting services throughout selected regions of the United States, Canada, and Chile;
+
+ 
+
+provide consistently reliable high-quality service;
+
+ 
+
+aggressively manage operating costs to maintain and improve operating margins;
+
+ 
+
+expand business by improving, enhancing and expanding sales, gaining new customers;
+
+ 
+
+pursue complementary bolt on growth opportunities having acceptable risks and returns; and
+
+ 
+
+generate consistent revenue, operating margins, earnings and cash flows.
+
+ 
+
+Implications of Being an Emerging Growth Company
+
+ 
+
+6
+
+We qualify as an emerging growth company as that term is used in the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:
+
+ 
+
+ 
+
+ 
+
+ 
+
+A requirement to have only two years of audited financial statements and only two years of related MD 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Exemption from the auditor attestation requirement in the assessment of the emerging growth company s internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002;
+
+ 
+
+ 
+
+ 
+
+ 
+
+Reduced disclosure about the emerging growth company s executive compensation arrangements; and
+
+ 
+
+ 
+
+ 
+
+ 
+
+No non-binding advisory votes on executive compensation or golden parachute arrangements.
+
+ 
+
+We have already taken advantage of these reduced reporting burdens in this registration statement, which are also available to us as a smaller reporting company as defined under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the Exchange Act ).
+
+ 
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the Securities Act ) for complying with new or revised accounting standards. We are choosing to utilize the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the JOBS Act. This election allows our Company to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. 
+
+ 
+
+We could remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
+
+ 
+
+The Company, the officer and director, or any Company promoters or their affiliates do not intend for the Company, once it is reporting, to be used as a vehicle for a private company to become a reporting company. We do not believe that we are a blank check company because we have no plans or intentions to engage in a merger or acquisition with an unidentified company, companies, entity or person unless we believe it will enhance, improve or grow our business operations. At this time, our objective is to increase our business operations by marketing our services and performing our job with quality and care to maximize value for our shareholders.
+
+The following sections present an overview of our business segment, including information regarding the principal business and competitive strengths. Our results of operations and financial condition are subject to a variety of risks. For information regarding our key risk factors, see Risk Factors. 
+
+We conduct consulting services in connection with the mining friendly regions of the United States of America, Canada, & Chile. Our business consists of one operation from the corporate headquarters. Our revenue will be generated from consulting services.
+
+We currently have only one employee, Ken Olsen, who is our CEO and President, 
+
+The Offering
+
+Number of Shares Being Offered:
+
+The selling security holders may sell up to 1,235,000 shares of common stock at $0.025 per share. Affiliated persons are not offering any shares. Issuance of these shares to the selling security holders was exempt from the registration and prospectus delivery requirements of the Securities Act of 1933, as amended. Non-affiliated selling security holders will sell at the fixed price. Selling shareholders may be deemed to be underwriters as defined under the Securities Act of 1933.
+
+Number of Shares Outstanding After the Offering:
+
+31,725,000 shares of our common stock are issued and outstanding. We have no other securities issued.
+
+7
+
+Selected Financial Data - Annual:
+
+ 
+
+ 
+ 
+ 
+For the nine months ended
+
+September 30, 2014
+
+ 
+ 
+ 
+ 
+
+Current assets
+
+$
+
+3,698
+
+Total Assets
+
+ 
+3,698
+
+ 
+
+Total current liabilities
+
+ 
+253,674
+
+Total stockholders' equity (deficit)
+
+ 
+(249,976)
+
+ 
+ 
+ 
+ 
+
+Working Capital 
+
+ 
+(249,976)
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+For the nine months ended
+
+September 30, 2014
+
+Statement of Operations
+
+ 
+ 
+
+ 
+Revenues
+
+$
+
+-0- 
+
+ 
+Operating expenses
+
+ 
+749,150
+
+ 
+Interest Expense
+
+ 
+15,151
+
+ 
+Net income (loss)
+
+$
+
+(764,301)
+
+RISK FACTORS
+
+Before you invest in our common stock, you should be aware that there are risks, as described below. You should carefully consider these risk factors together with all of the other information included in this prospectus before you decide to purchase shares of our common stock. Any of the following risks could adversely affect our business, financial conditions and results of operations.
+
+Risks Related To the Company
+
+(1) Our Auditor Has Expressed Substantial Doubt About Our Ability To Continue As A Going Concern.
+
+These financial statements included with this registration statement have been prepared on a going concern basis. We have a working capital deficiency of $249,976, and have an accumulated deficit of $919,276 as of September 30, 2014. We may not be able to generate profitable operations in the future and/or obtain the necessary financing to meet our obligations and repay liabilities arising from normal business operations when they come due. The outcome of these matters cannot be predicted with any certainty at this time. These factors raise substantial doubt that we will be able to continue as a going concern. The Company to date has funded its initial operations through the sale of unregistered securities in the amount of $22,500. Management plans to continue to provide for its capital needs by the issuance of common stock and related party advances. There can be no assurances that our management will be able to raise any capital through the issuance of our common stock or otherwise continue to provide for our capital needs through related party advances, loans or affiliate purchases of our common stock. Our financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern.
+
+(2) Our access to credit markets may be limited, which may adversely impact our liquidity. 
+
+We may require additional capital from outside sources from time to time. Our ability to arrange financing, and the cost of such capital, is dependent on numerous factors, including: 
+
+ 
+
+ 
+
+ 
+
+ 
+
+credit availability from banks and other financial institutions; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+investor confidence in us; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+our levels of indebtedness; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+competitive, legislative and regulatory matters; 
+
+ 
+
+ 
+ 
+
+ 
+
+cash flows; and,
+
+ 
+
+ 
+
+ 
+
+provisions of tax and securities laws that may impact raising capital.
+
+In addition, volatility in the capital markets may adversely affect our ability to access any available borrowing capacity under any revolving credit facility that we may be able to obtain. To the extent that we are required to seek outside financing in order to continue to business operations, the potential default on our country s government debt may have an adverse effect on the availability of traditional financing from financial institutions. There can be no assurances that if such financing is unavailable we will be able to acquire financing from any non-traditional or private source.
+
+(3) Our operating results and financial condition may be adversely affected by unfavorable general economic conditions. 
+
+Unfavorable economic conditions worldwide contribute to slowdowns. If global economic conditions or economic conditions in the U.S. remain uncertain or persist, spread or deteriorate further, we may experience material adverse impacts on our results of operations, cash flows and financial condition. 
+
+(4) Our profitability depends on the demand for the services we sell in the markets we serve. 
+
+Any sustained reduction in demand for our services in markets served by our midstream assets could result in a significant reduction in the volume of services that we sell, thereby adversely affecting our results of operations, cash flows and financial condition. Factors that could lead to a reduction in demand include: 
+
+ 
+
+ 
+
+ 
+
+ 
+
+an increase in the price of services; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+higher taxes, including federal excise taxes or sales taxes or other governmental or regulatory actions that increase, directly or indirectly; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+adverse economic conditions which result in lower spending by consumers and businesses on services we sell; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+higher taxes or other governmental or regulatory actions that increase the cost of the services we provide; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+effects of weather, natural phenomena, terrorism, war, or other similar acts; 
+
+ 
+
+ 
+
+ 
+
+a shift by consumers to more technological advances by manufacturers or federal or state regulations; and,
+
+ 
+
+ 
+
+ 
+
+ 
+
+decisions by our customers or suppliers to use alternate service providers for a portion or all of their needs, operate in different markets not served by us, reduce operations or cease operations entirely. 
+
+ 
+
+(5) Because of the natural decline in production in our areas of operation, our success depends on our ability to obtain new sources of business, which is dependent on factors beyond our control. 
+
+We have no control over the level of business consulting in our areas of operation. In addition, we have no control over business owners or their decisions, which are affected by, among other things, the availability and cost of capital, prevailing and projected prices, and demand for services, levels of reserves, geological considerations, environmental or other governmental regulations. 
+
+(6) Our establishment of new areas may not result in the anticipated revenue increases and is subject to unanticipated regulatory, environmental, political, legal and economic risks which could adversely affect our business. 
+
+One of the ways we intend to grow our business is through the establishment of new sales areas. The additions or modifications to our existing business and of new areas could involve a variety of regulatory, environmental, political and legal uncertainties beyond our control and may require the expenditure of significant amounts of capital. If we undertake such projects, they may not be completed on schedule or at the budgeted cost, or at all. Moreover, our revenue may not increase immediately upon the expenditure of funds on a particular project. For instance, if we expand into a new geographical area, the expansion may occur over an extended period of time and we will not receive any material increases in revenue until the project is completed. Moreover, we may construct facilities to capture anticipated future growth in production in a region in which such growth does not materialize. To the extent we rely on estimates of future production in our decision to expand, such estimates may prove to be inaccurate because of numerous uncertainties inherent in estimating quantities of future production. As a result, new areas may not be able to attract enough demand to achieve our expected investment return which could adversely affect our results of operations, cash flows and financial condition. 
+
+9
+
+(7) We may be unable to generate sufficient or positive cash flows from the sale of services to adequately support our financial or operational results. 
+
+Our marketing results depend upon our ability to generate sufficient or positive cash flows from the purchase, sale and cost to provide our services. Our cash flows are affected by many factors beyond our control, including: 
+
+ 
+
+ 
+
+ 
+
+ 
+
+availability of parties willing to enter into purchase and sale transactions with us; 
+
+ 
+
+ 
+
+ 
+
+increases in operational or capital costs; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+availability of funds from our operations and credit facilities to support marketing activities; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+availability of counterparties willing to offer credit to us; and,
+
+ 
+
+ 
+
+ 
+
+ 
+
+reductions in demand for, and supply of, consulting services for any reason. 
+
+ 
+
+ (8) We operate in a highly competitive business environment, and competitive pressures could adversely affect our business. 
+
+We compete with similar enterprises in our areas of operation. Our competitors may expand or construct sales systems and associated infrastructure that would create additional competition for the services we provide to our customers. Our ability to renew or replace existing contracts with our customers at rates sufficient to maintain current revenue and cash flows could be adversely affected by the activities of our competitors and our customers. Uncertainty and possible adverse publicity may make us more susceptible to the loss of customers to our competitors. All of these competitive pressures could have a material adverse effect on our business, results of operations and financial condition. 
+
+(9) Because our financial statements reflect results from inception, financial information in our current and future financial statements may not be comparable to prior periods. 
+
+The Company prepares its financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP"), which require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and reported amounts of revenues and expenses during the reporting period.
+
+(10) We have minimal revenues and limited operating history.
+
+We are a company with no principal revenues and limited operations and our auditor has expressed substantial doubt about our ability to continue as a going concern. Our record of minimal revenues and a limited operating history pose specific risks that may adversely affect our business or an investment in our common stock. There can be no assurances that we will generate sufficient revenue from future operations to implement our business plan or otherwise allow management to continue to devote any time to our business operations. There is nothing at this time on which to base an assumption that our business operations will prove to be successful or that we will ever be able to operate profitably. Our future operating results will depend on many factors, including our ability to raise adequate working capital, demand for our services, the level of our competition and our ability to attract and maintain key management and employees.
+
+ 
+
+Our prospects are subject to the risks and expenses encountered by start-up companies, such as ours, in establishing a business as consulting firm. Our limited operating history makes it difficult or impossible to predict future results of our operations. We may not establish a client base that will make us profitable, which might result in the loss of some or all of your investment in our common stock.
+
+ 
+
+You should consider our prospects in light of the risks and difficulties frequently encountered by early stage companies in the rapidly evolving consulting market. These risks include, but are not limited to, an unpredictable business environment, the difficulty of managing growth and the use of our business model among these risks. To address these risks, we must, among other things:
+
+ 
+
+expand our customer base;
+
+ 
+
+enhance our name recognition;
+
+ 
+
+expand our product and service offerings;
+
+ 
+
+successfully implement our business and marketing strategy;
+
+ 
+
+provide superior customer service;
+
+ 
+
+respond effectively to competitive and technological developments; and,
+
+ 
+
+attract and retain qualified personnel.
+
+10
+
+There can be no assurances that we will be able to engage in any of the aforementioned conduct or achieve any of the aforementioned results that we deem necessary to address or otherwise mitigate risks to our Company.
+
+(11) Adverse developments in our existing areas of operation could adversely impact our results of operations, cash flows and financial condition. 
+
+Our operations are focused on utilizing our sales efforts which are principally located in the Midwest, Southeast and West coast region of the U.S. As a result, our results of operations, cash flows and financial condition depend upon the demand for our services in these regions. Due to our current lack of broad diversification in industry type and geographic location, adverse developments in our current segment of the midstream industry, or our existing areas of operation, could have a significantly greater impact on our results of operations, cash flows and financial condition than if our operations were more diversified. 
+
+(12) As a public company, we will be subject to additional financial and other reporting and corporate governance requirements that may be difficult for us to satisfy, that will raise our costs and may divert resources and management attention from operating our business. 
+
+Since inception we have operated as a private company. As a public company, management has ability to exercise significant control over you. Furthermore, management has limited experience in operating a public company. Following the effectiveness of this registration statement, we will need to file with the SEC annual and quarterly information and other reports that are specified in the Securities Exchange Act of 1934, as amended (the Exchange Act ), and SEC regulations. Thus, we will need to ensure that we have the ability to prepare, on a timely basis, financial statements that comply with SEC reporting requirements.
+
+We will also become subject to other reporting and corporate governance requirements, including the listing standards of the Over the Counter Bulletin Board upon which we may list our one and only class of Common Stock, and the provisions of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), and the regulations promulgated thereunder, which will impose significant new compliance obligations upon us. As a public company, we will be required, among other things, to: 
+
+ 
+
+ 
+
+ 
+
+ 
+
+prepare and distribute reports and other stockholder communications in compliance with our obligations under the federal securities laws and the applicable national securities exchange listing rules; 
+
+ 
+
+ 
+
+ 
+
+define and expand the roles and the duties of our Board of Directors and its committees; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+institute more comprehensive compliance, investor relations and internal audit functions; 
+
+ 
+
+ 
+
+ 
+
+ 
+
+evaluate and maintain our system of internal control over financial reporting, and report on management s assessment thereof, in compliance with the requirements of Section 404 of the Sarbanes-Oxley Act and related rules and regulations of the SEC; and, 
+
+ 
+
+ 
+
+ 
+
+ 
+
+involve and retain outside legal counsel and accountants in connection with the activities listed above.
+
+The adequacy of our internal control over financial reporting must be assessed by management for each year commencing with the year ending December 31, 2013. Our internal control over financial reporting may not currently meet the standards required by Section 404 of the Sarbanes-Oxley Act. We will incur additional costs in order to improve our internal control over financial reporting and comply with Section 404, including increased auditing and legal fees and costs associated with hiring additional accounting and administrative staff. Ultimately, our efforts may not be adequate to comply with the requirements of Section 404. If we are unable to implement and maintain adequate internal control over financial reporting or otherwise to comply with Section 404, we may be unable to report financial information on a timely basis, may suffer adverse regulatory consequences, may have violations of the applicable national securities exchange listing rules and may breach covenants under our credit facilities. There could also be a negative reaction in the financial markets due to a loss of investor confidence in us and the reliability of our financial statements. 
+
+The changes necessitated by becoming a public company will require a significant commitment of additional resources and management oversight that will increase our costs and might place a strain on our systems and resources. As a result, our management s attention might be diverted from other business concerns. In addition, we might not be successful in implementing and maintaining controls and procedures that comply with these requirements. If we fail to maintain an effective internal control environment or to comply with the numerous legal and regulatory requirements imposed on public companies, we could make material errors in, and be required to restate, our financial statements. Any such restatement could result in a loss of public confidence in the reliability of our financial statements and sanctions imposed on us by the SEC. 
+
+(13) We are exposed to the creditworthiness and performance of our customers, suppliers and transactional counterparties, and any material nonpayment or nonperformance by one or more of these parties could adversely affect our financial and operational results. 
+
+There can be no assurance we have adequately assessed the creditworthiness of each of our existing or future customers, suppliers or transactional counterparties or that there will not be a rapid or unanticipated deterioration in their creditworthiness, which 
+
+11
+
+may have an adverse impact on our financial condition and results of operations. Nor is there certainty that our counterparties will perform or adhere to existing or future contractual arrangements. 
+
+We manage our exposure to credit risk through credit analysis and credit monitoring procedures and policies, including credit support requirements for customers and counterparties to which we extend no or limited unsecured credit, such as letters of credit, prepayments, and guarantees. Additionally, we apply a risk/reward analysis on each client to insure that their projections and business assumptions are accurate, reasonable and provide a likelihood of success.
+
+However, these procedures and policies cannot fully eliminate counterparty credit risks, and to the extent our procedures and policies prove to be inadequate, our financial and operational results may be negatively impacted. 
+
+ (14) We Are Dependent On The Services Of A Certain Key Employee And The Loss Of His Services Could Harm Our Business.
+
+Our success largely depends on the continuing services of our Chief Executive Officer and Chairman, Ken Olsen. Our continued success also depends on our ability to attract and retain qualified personnel. We believe that Mr. Olsen possesses valuable knowledge, experience and leadership abilities that would be difficult in the short term to replicate. The loss of him as a key employee could harm our operations, business plans and cash flows. Mr. Olsen has agreed to dedicate approximately 20 hours per week to the development of our business. This limited amount of time that Mr. Olsen is able to devote to the development of our business on a weekly basis may inhibit our ability to generate sufficient revenue to maintain our business as a going concern.
+
+(15) We are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.
+
+ 
+
+We are an emerging growth company, as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including not being required to comply with the auditor attestation requirements of section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
+
+ 
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing to follow the extended transition period, and as a result, we will delay adoption of certain new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. We will remain an emerging growth company for up to five years, although if the market value of our common stock that is held by non-affiliates exceeds $700 million as of any December 31 before that time, we would cease to be an emerging growth company as of the following December 31, or if we issue more than $1 billion in non-convertible debt in a three-year period, we would cease to be an emerging growth company immediately.
+
+ 
+
+(16) Because we have elected to defer compliance with new or revised accounting standards, our financial statement disclosure may not be comparable to similar companies.
+
+We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the JOBS Act. This allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of our election, our financial statements may not be comparable to companies that comply with public company effective dates.
+
+Risks Related To This Offering
+
+(17) There Is No Public Market for Our Shares, and We Do Not Know If One Will Develop Due to the Limited Demand for Stocks In the Business Services We Offer.
+
+Purchasers of these shares are at risk of no liquidity for their investment. Prior to this offering, there has been no established trading market for our securities, and we do not know that a regular trading market for the securities will develop. Due to the limited services we offer, we anticipate that demand for our shares will not be very high. If a trading market does develop for the securities offered hereby, we do not know if it will be sustained. We plan to apply to have our stock quoted on the over-the-counter ( OTC ) Electronic Bulletin Board. We intend to seek a market maker to file an application with the Financial Industry Regulatory Authority ( FINRA ). We must obtain the services of a FINRA approved broker-dealer/market maker to file an application for our Company and we do not know if such market maker will be to obtain a listing or if an established market for our common stock will be developed. There can be no assurance that we will be able to find a market maker that will be willing to file a Form 211 with FINRA 
+
+12
+
+to facilitate our acquisition of a trading symbol and authorization for any broker-dealer to post a bid for our common stock. There can be no assurance that an active market will develop even if our common stock is listed on the OTC Bulletin Board or any stock exchange. In addition, we would be subject to an SEC rule that, if it failed to meet criteria set forth in such rule, imposes various practice requirements on broker-dealers who sell securities governed by the rule to persons other than established customers and accredited investors. Consequently, such rule may deter broker-dealers from recommending or selling our common stock, which may further affect its liquidity.
+
+ (18) The Possible Sale of Shares of Common Stock by Our Selling Security Holders May Have a Significant Adverse Effect on the Market Price of Our Common Stock Should a Market Develop. 
+
+Our ability to raise additional capital through the sale of our stock in a private placement may be harmed by these competing re-sales of our common stock by the selling security holders. Potential investors may not be interested in purchasing shares of our common stock if the selling security holders are selling their shares of common stock. The selling of stock by the security holders could be interpreted by potential investors as a lack of confidence in us and our ability to develop a stable market for our stock. The price of our common stock could fall if the selling security holders sell substantial amounts of our common stock. These sales may make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem appropriate because the selling security holders may offer to sell their shares of common stock to potential investors for less than we do.
+
+(19) Our Lack of Business Diversification Could Result in the Devaluation of Our Stock if our Revenues From Our Primary Services Decrease.
+
+We expect our business to solely consist of the sale of consulting services. We do not have any other lines of business or other sources of revenue if we are unable to compete effectively in the marketplace. This lack of business diversification could cause you to lose all or some of your investment if we are unable to generate additional revenues since we do not expect to have any other lines of business or alternative revenue sources.
+
+ (20) There Has Been No Independent Valuation of the Stock, Which Means That the Stock May Be Worth Less Than the Purchase Price.
+
+The per share purchase price has been determined by us without independent valuation of the shares. We established the offering price based on our recent sale of stock at par value, not based on perceived market value, book value, or other established criteria. We did not obtain an independent appraisal opinion on the valuation of the shares. The shares may have a value significantly less than the offering price and the shares may never obtain a value equal to or greater than the offering price.
+
+(21) Investors May Never Receive Cash Distributions Which Could Result in an Investor Receiving Little or No Return on His or Her Investment.
+
+Distributions are payable at the sole discretion of our board of directors. We do not know the amount of cash that we will generate, if any, once we have more productive operations. There can be no assurances that we will ever have productive operations to generate cash flow for our business. Cash distributions are not assured, and we may never be in a position to make distributions.
+
+ (22) The Penny Stock Rules Could Restrict the Ability of Broker-Dealers to Sell Our Shares Having a Negative Effect on Our Offering.
+
+The SEC has adopted penny stock regulations which apply to securities traded over-the-counter. These regulations generally define penny stock to be any equity security that has a market price of less than $5.00 per share or an equity security of an issuer with net tangible assets of less than $5,000,000 as indicated in audited financial statements, if the corporation has been in continuous operations for less than three years. Subject to certain limited exceptions, the rules for any transaction involving a penny stock require the delivery, prior to the transaction, of a risk disclosure document prepared by the SEC that contains certain information describing the nature and level of risk associated with investments in the penny stock market. The broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative and current quotations for the securities. Monthly account statements must be sent by the broker-dealer disclosing the estimated market value of each penny stock held in the account or indicating that the estimated market value cannot be determined because of the unavailability of firm quotes. In addition, the rules impose additional sales practice requirements on broker-dealers who sell such securities to persons other than established customers and institutional accredited investors (generally institutions with assets in excess of $5,000,000). These practices require that, prior to the purchase, the broker-dealer determined that transactions in penny stocks were suitable for the purchaser and obtained the purchaser s written consent to the transaction. If a market for our common stock does develop and our shares trade below $5.00 per share, it will be a penny stock. Consequently, the penny stock rules will likely restrict the ability of broker-dealers to sell our shares and will likely affect the ability of purchasers in the offering to sell our shares in the secondary market. Trading in our common stock will be subject to the penny stock rules. Due to the thinly traded market of these shares investors are at a much higher risk to lose all or part of their investment. Not only are these shares thinly traded but they are subject to higher fluctuations in price due to the instability of earnings of these smaller companies. As a result of the lack of a highly traded market in our shares investors are at risk of a lack of brokers who may be willing to trade in these shares.
+
+ (23) If our customers are found in violation of the Environmental, Health and Safety Regulation it could negatively impact our sales if our customers operations are interrupted.
+
+13
+
+General 
+
+Our customers operations have been subject to varying degrees of complex laws and regulations by multiple levels of government relating to the production, transportation, storage, processing, release and disposal of waste, products and other materials or otherwise relating to protection of the environment. Our company is not currently directly subject to such regulations. 
+
+(24) We might not be successful in achieving our objectives if there are significant changes in the economic and regulatory environment surrounding business.
+
+AMRI will be subject to risks related to national economic conditions, changes in the investment climate for business consulting governmental rules and fiscal policies, and other factors beyond the control of our management. 
+
+(25) Our business may be significantly harmed by a slowdown in the economy.
+
+ 
+
+An overall decline in the economy or the occurrence of a natural disaster could decrease the need of our services. . This could restrict our success in attracting clients and significantly harm our business, financial condition and liquidity. 
+
+(26) To the extent that we expand our operations to new markets, our business operations may suffer from our lack of experience, which may adversely affect our revenues.
+
+Currently, AMRI maintains its principal business office in Wisconsin .Depending on the market and our performance, we plan to expand our operations throughout the United States. However, we have limited experience outside of the market in which we currently operate. Any difficulties encountered by us in this regard could adversely affect our operating results, slow down our expansion plans, which may diminish our revenues. 
+
+ 
+
+(27) The issuance of additional shares of stock to obtain additional financing may dilute the holdings of our existing stockholders or reduce the market price of our stock.
+
+The 1,235,000 shares of common stock owned by the selling security holders will be registered with the U.S. Securities Exchange Commission. The security holders may sell some or all of their shares immediately after they are registered. In the event that the security holders sell some or all of their shares, the price of our common stock could decrease significantly. Additional equity offerings by us may dilute the holdings of our existing stockholders or reduce the market price of our common stock, or both. Any decision to issue securities in any future offering will depend on market conditions and other factors beyond our control. AMRI cannot predict or estimate the amount, timing or nature of our future offerings. Thus, our stockholders bear the risk of our future offerings reducing the market price of our common stock or diluting their stock holdings in us. 
+
+A NOTE CONCERNING FORWARD-LOOKING STATEMENTS
+
+This prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipates, believes, plans, expects, future, intends, and similar expressions to identify these forward-looking statements. Prospective investors should not place undue reliance on these forward-looking statements, which apply only as of the date of this prospectus. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by ARRAKIS MINING RESEARCH INC. described in Risk Factors and elsewhere in this prospectus. For example, a few of the uncertainties that could affect the accuracy of forward-looking statements include:
+
+(a)
+
+an abrupt economic change resulting in an unexpected downturn in demand for our services;
+
+(b)
+
+governmental restrictions or excessive taxes on our services;
+
+(c)
+
+economic resources to support the development of our projects;
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/AGIO_agios_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/AGIO_agios_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..6fd1b31a26ec10bc1fd1e216e073634da63e7929
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/AGIO_agios_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/ARMK_aramark_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/ARMK_aramark_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/ARMK_aramark_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/ASPU_aspen_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/ASPU_aspen_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..e6977daaabb4e78b9765b960a18447fc4f2ac1a9
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/ASPU_aspen_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. You should read the entire prospectus carefully including the section entitled Risk Factors before making an investment decision. In March 2012, Aspen Group, Inc., or Aspen Group, and Aspen University Inc., a privately held Delaware corporation, or Aspen, entered into a merger agreement whereby Aspen became a wholly-owned subsidiary of Aspen Group. We refer to the merger as the Reverse Merger. All references to we, our and us refer to Aspen Group and its subsidiaries (including Aspen), unless the context otherwise indicates. In referring to academic matters, these words refer solely to Aspen University, Inc. Our Company Aspen is an online postsecondary education company. Founded in 1987, Aspen s mission is to offer any motivated college-worthy student the opportunity to receive a high quality, responsibly priced distance-learning education for the purpose of achieving sustainable economic and social benefits for themselves and their families. Because we believe higher education should be a catalyst to our students long-term economic success, we exert financial prudence by offering affordable tuition that is one of the greatest values in online higher education. Aspen is dedicated to providing the highest quality education experiences taught by top-tier professors - 61% of our adjunct professors hold doctorate degrees. Corporate Information Our corporate headquarters are located at 720 South Colorado Boulevard, Suite 1150N, Denver, Colorado 80246 and our phone number is (303) 333-4224. Our corporate website can be found at www.aspen.edu/investor-relations. The information on our website is not incorporated in this prospectus. Risks Affecting Us Our business is subject to numerous risks as discussed more fully in the section entitled Risk Factors immediately following this Prospectus Summary. In particular, our business would be adversely affected if: we are unable to comply with the extensive regulatory requirements to which our business is subject, including Title IV of the Higher Education Act, or Title IV, and the regulations under that act, state laws and regulations, accrediting agency requirements, and our inability to comply with these regulations could result in our ceasing operations altogether; we are unable to generate sufficient revenue to meet our future working capital needs; our marketing and advertising efforts are not effective; we are unable to develop new programs and expand our existing programs in a timely and cost-effective manner; we are unable to increase our class starts by existing students and increase new enrollments; our new monthly installment plan is unsuccessful; we are unable to attract and retain key personnel needed to sustain and grow our business; or our reputation is damaged by regulatory actions or negative publicity affecting us or other companies in the for-profit higher education sector. For a discussion of these and other risks you should consider before making an investment in our common stock, see the section entitled Risk Factors beginning on page 4 of this prospectus. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered(1) Proposed Maximum Offering Price Per Share(2) Proposed Maximum Aggregate Offering Price(2) Amount of Registration Fee Common stock, $0.001 par value per share 52,570,607 $ 0.23 $ 11,959,813.09 $ 1,389.73 (1) Under Rule 416 of the Securities Act of 1933, the shares being registered include such indeterminate number of shares of common stock as may be issuable with respect to the shares being registered in this registration statement as a result of any stock splits, stock dividends. (2) The proposed maximum offering price per share and the proposed maximum aggregate offering price have been estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rules 457(c) under the Securities Act of 1933 on the basis of the average of the bid and asked price of our common stock on the Over-the-Counter Bulletin Board on October 6, 2014, a date within five days prior to the date of the filing of this registration statement. The registrant hereby amends this registration statement on such date or date(s) as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until the registration statement shall become effective on such date as the Commission acting pursuant to said Section 8(a) may determine. THE OFFERING Common stock outstanding prior to the offering: 112,786,304 shares Common stock offered by the selling shareholders: 52,570,607 shares (1) Common stock outstanding immediately following the offering: 129,814,229 shares (2) Use of proceeds: Except for the proceeds we receive upon the exercise of warrants, we will not receive any proceeds from the sale of shares by the selling shareholders. See Use of Proceeds on page 22. Stock symbol: OTCBB: ASPU The number of shares of common stock to be outstanding prior to and after this offering excludes: a total of 13,266,412 shares of common stock issuable upon the exercise of outstanding stock options; a total of 1,033,588 shares of common stock reserved for future issuance under our 2012 Equity Incentive Plan, which we refer to as the Plan ; a total of 26,980,038 shares of common stock issuable upon the exercise of warrants, which does not include the warrants referred to above; and a total of 1,314,732 shares of common stock issuable upon the conversion of notes. (1) Consists of 35,542,682 shares of common stock currently outstanding and 17,027,925 shares issuable upon exercise of warrants. (2) Assumes all warrants are exercised for cash. The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission of which this prospectus is a part becomes effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion, Dated October 8, 2014 ASPEN GROUP, INC. PROSPECTUS 52,570,607 Shares of Common Stock This prospectus relates to the sale of up to 52,570,607 shares of Aspen Group, Inc. common stock which may be offered by the selling shareholders identified in this prospectus on page 65. We will not receive any proceeds from the sales of shares of our common stock by the selling shareholders. Our common stock trades on the Over-the-Counter Bulletin Board under the symbol ASPU . As of the last trading day before the date of this prospectus, the closing price of our common stock was $0.24 per share. The common stock offered in this prospectus involves a high degree of risk. See Risk Factors beginning on page 4 of this prospectus to read about factors you should consider before buying shares of our common stock. The selling shareholders are offering these shares of common stock. The selling shareholders may sell all or a portion of these shares from time to time in market transactions through any market on which our common stock is then traded, in negotiated transactions or otherwise, and at prices and on terms that will be determined by the then prevailing market price or at negotiated prices directly or through a broker or brokers, who may act as agent or as principal or by a combination of such methods of sale. The selling shareholders will receive all proceeds from the sale of the common stock. For additional information on the methods of sale, you should refer to the section entitled Plan of Distribution. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined whether this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is ________, 2014 SUMMARY FINANCIAL DATA The following summary of our financial data should be read in conjunction with, and is qualified in its entirety by reference to Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements appearing elsewhere in this prospectus. Statements of Operations Data For the three For the year For the year months ended ended ended For the July 31, April 30, December 31, Four Months Ended April 30, 2014 2014 2012 2013 2012 (Unaudited) (Unaudited) Revenues $ 1,169,860 $ 3,981,722 $ 2,684,931 $ 1,229,096 $ 745,656 Loss from continuing operations before income taxes (864,261 ) (5,435,011 ) (6,147,044 ) (1,291,055 ) (2,361,632 ) Net loss per share allocable to common stockholders basic and diluted $ (0.01 ) $ (0.09 ) $ (0.17 ) $ (0.03 ) $ (0.11 ) Weighted average number of common shares outstanding: Basic and diluted 73,818,014 62,031,861 35,316,681 56,089,884 21,135,361 Balance Sheet Data July 31, 2014 April 30, 2014 April 30, 2013 ($) ($) ($) (Unaudited) Cash and cash equivalents 1,416,407 247,380 724,982 Working capital (deficit) (704,463 ) (1,700,114 ) (301,669 ) Total assets 4,791,638 3,583,840 3,401,685 Total current liabilities 3,789,318 3,516,816 1,935,860 Accumulated deficit (18,954,695 ) (18,090,434 ) (12,740,086 ) Total shareholders equity (deficit) (845,460 ) (1,784,902 ) 594,375 TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights selected information contained in greater detail elsewhere in this prospectus. This summary may not contain all of the information that you should consider before investing in our ADSs. You should carefully read the entire prospectus, including Risk Factors and the financial statements, before making an investment decision. Our Mission Our mission is to make it easy to do business anywhere. Our founders started our company to champion small businesses, in the belief that the Internet would level the playing field by enabling small enterprises to leverage innovation and technology to grow and compete more effectively in the domestic and global economies. Our decisions are guided by how they serve our mission over the long-term, not by the pursuit of short-term gains. Our Business We are the largest online and mobile commerce company in the world in terms of gross merchandise volume in 2013, according to the IDC GMV Report. We operate our ecosystem as a platform for third parties, and we do not engage in direct sales, compete with our merchants or hold inventory. We operate Taobao Marketplace, China s largest online shopping destination, Tmall, China s largest third-party platform for brands and retailers, in each case in terms of gross merchandise volume, and Juhuasuan, China s most popular group buying marketplace by its monthly active users, in each case in 2013 according to iResearch. These three marketplaces, which comprise our China retail marketplaces, generated a combined GMV of RMB1,833 billion (US$296 billion) from 279 million active buyers and 8.5 million active sellers in the twelve months ended June 30, 2014. A significant portion of our customers have begun transacting on our mobile platform, and we are focused on capturing this opportunity. In the three months ended June 30, 2014, mobile GMV accounted for 32.8% of our GMV, up from 27.4% in the preceding three months and from 12.0% in the same period in the previous year. The number of mobile MAUs increased from 136 million for the month ended December 31, 2013, to 163 million for the month ended March 31, 2014 and to 188 million for the month ended June 30, 2014. In addition to our three China retail marketplaces, which accounted for 81.6% of our revenues in fiscal year 2014, we operate Alibaba.com, China s largest global online wholesale marketplace in 2013 by revenue, according to iResearch, 1688.com, our China wholesale marketplace, and AliExpress, our global consumer marketplace, as well as provide cloud computing services. As a platform, we provide the fundamental technology infrastructure and marketing reach to help businesses leverage the power of the Internet to establish an online presence and conduct commerce with consumers and businesses. We have been a leader in developing online marketplace standards in China. Given the scale we have been able to achieve, an ecosystem has developed around our platform that consists of buyers, sellers, third-party service providers, strategic alliance partners, and investee companies. Our platform and the role we play in connecting buyers and sellers and making it possible for them to do business anytime and anywhere is at the nexus of this ecosystem. Much of our effort, our time and our energy is spent on initiatives that are for the greater good of the ecosystem and the various participants in it. We feel a strong responsibility for the continued development of the ecosystem and we take ownership for this development. Accordingly, we refer to this as our ecosystem. Our ecosystem has strong self-reinforcing network effects that benefit our marketplace participants, who are invested in our ecosystem s growth and success. Through this ecosystem, we have transformed how commerce is conducted in China and built a reputation as a trusted partner for the participants in our ecosystem. We have made significant investments in proprietary technologies and infrastructure in order to support our growing ecosystem. Our technology and infrastructure allow us to harness the substantial volume of data generated from our marketplaces and to further develop and optimize the products and services offered on our platform. Table of Contents The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling shareholders may sell these securities until the registration statement filed with the United States Securities and Exchange Commission is declared effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting any offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, Dated September 15, 2014 320,106,100 American Depositary Shares Representing 320,106,100 Ordinary Shares Alibaba Group Holding Limited This is the initial public offering of Alibaba Group Holding Limited, or Alibaba Group. We are offering 123,076,931 American Depositary Shares, or ADSs, and the selling shareholders named in this prospectus, including Yahoo, one of our principal shareholders, Jack Ma, our executive chairman, and Joe Tsai, our executive vice chairman, are offering, in the aggregate, 197,029,169 ADSs. Each ADS represents one ordinary share, par value US$0.000025 per share. We expect that the initial public offering price of the ADSs will be between US$66.00 and US$68.00 per ADS. We will not receive any proceeds from the ADSs sold by the selling shareholders. Pursuant to our memorandum and articles of association, a partnership, or the Alibaba Partnership, comprised of certain management members of our company, Small and Micro Financial Services Company and China Smart Logistics, will have the exclusive right to nominate a simple majority of the board of directors of our company. See Alibaba Partnership and Description of Share Capital Ordinary Shares Nomination, Election and Removal of Directors. Prior to this offering, there has been no public market for our ADSs or ordinary shares. Our ADSs have been approved for listing on the New York Stock Exchange under the symbol BABA. Investing in our ADSs involves risk. See Risk Factors beginning on page 25. Per ADS Total Price to public US$ US$ Underwriting discounts and commissions US$ US$ Proceeds, before expenses, to us US$ US$ Proceeds, before expenses, to the selling shareholders US$ US$ We, Yahoo, Jack Ma and Joe Tsai have granted the underwriters the right to purchase up to an aggregate of 48,015,900 additional ADSs. Neither the United States Securities and Exchange Commission nor any state securities commission or any other regulatory body has approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the ADSs against payment in U.S. dollars to purchasers on or about , 2014. Credit Suisse Deutsche Bank Goldman Sachs J.P. Morgan Morgan Stanley Citi BOCI CICC CLSA DBS Bank HSBC Mizuho Pacific Crest RBC Stifel Wells Fargo BNP PARIBAS Evercore Raymond James SunTrust Robinson Humphrey , 2014. Table of Contents Through contractual arrangements with Alipay, we offer payment and escrow services for buyers and sellers, providing security, trust and convenience to our users. Since 2011, we have not held any interest in or control over Alipay or its parent company. Following the divestment of our interest in and control over Alipay, effective in the first calendar quarter of 2011, we have maintained long-term commercial arrangements with Alipay, which we believe align both companies interests in the success of our ecosystem. We also continue to derive economic benefits from our contractual arrangements with Alipay. For further details regarding our relationship with Alipay and its parent company, including the recent restructuring of our contractual arrangements with them in August 2014, see Related Party Transactions Agreements and Transactions Related to Small and Micro Financial Services Company and its Subsidiaries Ownership of Small and Micro Financial Services Company. We take a platform approach to shipping and delivery by working with third-party logistics service providers through a central logistics information system operated by Zhejiang Cainiao Supply Chain Management Co., Ltd., or China Smart Logistics, our 48%-owned affiliate. Through our acquisition of UCWeb, we are able to leverage its expertise as a developer and operator of mobile web browsers to enhance our mobile offerings beyond e-commerce, such as general mobile search, which gives us access to UCWeb s large base of mobile users and offers our existing user base additional mobile solutions. Our revenue is primarily generated from merchants through online marketing services (via Alimama, our proprietary online marketing platform), commissions on transactions and fees for online services. We also generate revenues through fees from memberships, value-added services and cloud computing services. GMV generated on our China retail marketplaces increased by 55.8% from RMB1,077 billion in fiscal year 2013 to RMB1,678 billion (US$270 billion) in fiscal year 2014. Our total revenue increased by 52.1% from RMB34,517 million in fiscal year 2013 to RMB52,504 million (US$8,463 million) in fiscal year 2014. Our total revenue increased by 46.3% from RMB10,778 million in the three months ended June 30, 2013 to RMB15,771 million (US$2,542 million) in the same period in 2014. We do not allocate revenue among each of our China retail marketplaces. Our net income increased by 170.6% from RMB8,649 million in fiscal year 2013 to RMB23,403 million (US$3,772 million) in fiscal year 2014. Our net income increased by 179.6% from RMB4,448 million in the three months ended June 30, 2013 to RMB12,438 million (US$2,005 million) in the same period in 2014. For the three months ended June 30, 2014, our net income included a net gain of RMB6,251 million (US$1,008 million) from step-up acquisitions arising from revaluations of previously held equity interest. Our fiscal year ends on March 31. Our Key Metrics We have experienced significant growth across various key metrics for our China retail marketplaces: Table of Contents Table of Contents Table of Contents Table of Contents Our business and our ecosystem as a whole have achieved significant scale and size: Our Scale and Size Scale and Size of Our Ecosystem Participants Unless otherwise indicated, all figures in the above charts are for the twelve months ended, or as of, June 30, 2014, and in the case of our scale and size, on our China retail marketplaces. (1) For the three months ended June 30, 2014. (2) According to iResearch for the three months ended June 30, 2014. (3) For the month ended June 30, 2014. Based on the aggregate mobile MAUs of apps that contribute to GMV on our China retail marketplaces. The number of mobile MAUs increased from 136 million in the month ended December 31, 2013 to 163 million in the month ended March 31, 2014 and to 188 million in the month ended June 30, 2014. (4) For the twelve months ended June 30, 2014. Representing 54% of the 11.3 billion packages delivered in the twelve months ended June 30, 2014 by delivery services in China meeting certain minimum revenue thresholds, according to the State Post Bureau of the PRC. (5) Alibaba Cloud Computing processing capability as of December 31, 2013. (6) The sum of merchants on our (i) China retail marketplaces who paid fees and/or commissions to us in the twelve months ended June 30, 2014, plus (ii) wholesale marketplaces with current paid memberships as of June 30, 2014. A merchant may have more than one paying relationship with us. (7) Includes registered countries and territories of (i) buyers that sent at least one inquiry to a seller on Alibaba.com and (ii) buyers that settled at least one transaction on AliExpress through Alipay, in each case in the twelve months ended June 30, 2014, demonstrating the global reach and the potential for cross-border commerce opportunities across our marketplaces. (8) For the twelve months ended June 30, 2014. Approximately 29.7% of Alipay s total payment volume in the twelve months ended June 30, 2014 represented payments processed for our China retail marketplaces. (9) Marketing affiliates who received a revenue share from us in the three months ended December 31, 2013. (10) Based on data provided by our 14 strategic delivery partners as of June 30, 2014. Table of Contents Table of Contents The Network Effect on and across Our Marketplaces The interactions between buyers and sellers create network effects in that more merchants attract more consumers, and more consumers attract more merchants. In addition, our marketplaces are interconnected in that many buyers and sellers on one marketplace also participate in the activities on our other marketplaces, thereby creating a second-order network effect that further strengthens our ecosystem. The chart below depicts this network effect dynamic in our ecosystem. Buyers Chinese consumers buy on Taobao Marketplace, Tmall and Juhuasuan While browsing or searching on Taobao Marketplace, consumers see product listings from both Taobao Marketplace and Tmall Global consumers buy on AliExpress Global wholesalers buy on Alibaba.com Retail sellers Small sellers in China sell on Taobao Marketplace and AliExpress Chinese brands sell on Taobao Marketplace, Tmall, Juhuasuan and AliExpress and global brands sell on Tmall Global Sellers source products on 1688.com Wholesale sellers Chinese wholesalers and manufacturers supply retail merchants in China on 1688.com and global wholesale buyers on Alibaba.com Chinese wholesalers and manufacturers supply directly to global consumers on AliExpress Global wholesalers and manufacturers supply global wholesale buyers on Alibaba.com Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary 1
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+S-1/A 1 a13-27174_11s1a.htm PRE-EFFECTIVE AMENDMENT Table of Contents As filed with the Securities and Exchange Commission on July 17, 2014 Registration No. 333-193298 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form S-1 Amendment No. 5 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 CUBIC ENERGY, INC. (Exact name of registrant as specified in its charter) Texas 1311 87-0352095 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 9870 PLANO ROAD DALLAS, TEXAS 75238 (972) 686-0369 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Calvin A. Wallen, III President and Chief Executive Officer Cubic Energy, Inc. 9870 Plano Road Dallas, Texas 75238 (972) 686-0369 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copy to: David R. Earhart Gray Reed & McGraw PC 1601 Elm Street Suite 4600 Dallas, Texas 75201 (214) 954-4135 Approximate date of commencement of proposed sale to the public: As soon as practicable after the Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: x If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer o Accelerated filer o Non-accelerated filer o (Do not check if a smaller reporting company) Smaller reporting company x CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered (1) Proposed Maximum Offering Price Per Share Proposed Maximum Aggregate Offering Price Amount of Registration Fee Common Stock, $0.05 par value, issuable upon exercise of Class A Warrants 65,834,549 $0.2600(2) $17,116,982.74 $2,204.67 Common Stock, $0.05 par value, issuable upon exercise of Class B Warrants 32,917,274 $0.50(3) $16,458,637.00 $2,119.87 Total 98,751,823 $33,575,619.74 $4,324.54(4) (1) All of the shares registered pursuant to this registration statement are to be offered by selling shareholders. Pursuant to Rule 416 under the Securities Act, this registration statement also covers such number of additional shares of common stock to prevent dilution resulting from stock splits, stock dividends and similar transactions, including pursuant to the terms of the warrants pursuant to which such shares may be issued. (2) Estimated solely for the purpose of calculating the registration fee, which has been computed in accordance with Rule 457(c) and Rule 457(g) under the Securities Act, based on the average of the high and low prices for the Common Stock on January 8, 2014, as reported on the OTCQB Tier of the U.S. OTC Market. (3) Reflects the exercise price of the Class B Warrants. (4) Previously paid. The Registrant hereby amends this Registration Statement on such date or date as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents TABLE OF CONTENTS Page No. SUMMARY 1
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0000789388_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0000789388_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0000827871_eagle_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0000827871_eagle_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8c704c1c16f75d7b5293d4e693901ac88879ce4b
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained in other parts of this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in shares of our common stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this prospectus. You should read the entire prospectus carefully, especially "Risk Factors" and our financial statements and the related notes, before deciding to buy shares of our common stock. Unless the context requires otherwise, references in this prospectus to "Eagle," "Eagle Pharmaceuticals," "we," "us" and "our" refer to Eagle Pharmaceuticals, Inc. Overview We are a specialty pharmaceutical company focused on developing and commercializing injectable products utilizing the FDA's 505(b)(2) regulatory pathway. We develop products that address the shortcomings, as identified by physicians, pharmacists and other stakeholders, of existing commercially successful injectable products. Our currently disclosed product portfolio includes two approved products and six advanced product candidates that together account for approximately $4 billion in peak U.S. branded reference drug sales. For each of our products, we intend to enter the market no later than the first generic drug, allowing us to substantially convert the market to our product while maintaining attractive pricing. We believe we can further extend the commercial duration of our products through new intellectual property protection and/or orphan drug exclusivity and three years of regulatory exclusivity as provided under the Hatch-Waxman Act, as applicable. We believe our strategy has been validated with the approval of our first product, EP-1101, a proprietary version of argatroban, which was approved by the FDA in June 2011. EP-1101 entered the market prior to the first generic version of argatroban and has captured a 28%, and growing, share of the overall argatroban market while maintaining attractive pricing. Two of our most advanced product candidates are proprietary presentations of bendamustine, which is currently marketed by Teva Pharmaceuticals, or Teva, under the brand name Treanda and indicated for the treatment of certain hematologic cancers. Bendamustine had 2012 U.S. branded sales of over $600 million, and based on recent market research we anticipate sales to continue to grow substantially in 2013 and 2014, and we estimate that sales could reach $800 million in 2015. We believe our proprietary bendamustine products, EP-3101 and EP-3102, are improved products compared to Teva's Treanda because they are ready to dilute, or RTD, liquids with longer stability and also offer the potential for shorter infusion time. These attributes result in added benefits to nurses, patients and pharmacists, and improved economics to physicians and other stakeholders. Our NDA for EP-3101 was filed with the FDA on September 6, 2013 and we believe EP-3101 will enter the market prior to generic competition and will capture a significant portion of the bendamustine market, as has been the case for our argatroban product. Our currently disclosed product portfolio also includes proprietary innovations of Alimta, Angiomax, and Dantrium (dantrolene), which together represent $3.4 billion in U.S. peak branded drug sales. Our orphan drug designated version of dantrolene (Ryanodex) is formulated to require substantially less volume and shorter reconstitution time when treating malignant hyperthermia, a hyperacute situation where time to treatment is of critical importance. We believe these formulation characteristics afford us Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the "Securities Act"), check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. (1)Based on publicly filed reports with the SEC, independent market research and management's estimates extrapolated therefrom. Our Strengths We believe our competitive strengths include our: currently disclosed portfolio which includes two approved products and six distinct product candidates in development that target an overall U.S. market of approximately $4 billion in peak annual branded reference drug revenue; knowledge of the industry, including our ability to optimize products' ease and safety of use for healthcare providers, produce less drug waste and lower cost to stakeholders; and our experience with the 505(b)(2) regulatory pathway, and our ability to navigate paragraph IV challenges; differentiated business model as compared to generic and branded specialty pharmaceutical drug companies, which we believe has been validated by our first approval and commercial launch in the United States of our novel formulation of argatroban, EP-1101, utilizing the 505(b)(2) pathway; patent estate of ten owned or exclusively licensed U.S. issued patents and twelve filed U.S. patent applications, as well as several patent applications that have been filed in various worldwide territories, that protect or will protect, as applicable the market value of our current portfolio of products; Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the Securities and Exchange Commission declares our registration statement effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to completion, dated February 4, 2014 3,333,333 Shares EAGLE PHARMACEUTICALS, INC. Common Stock Table of Contents ability to leverage our formulation and development expertise to avoid infringing existing patents; and senior management team, which has over 100 years of combined experience in building and running leading pharmaceutical companies including our President and Chief Executive Officer, Scott Tarriff, who spearheaded the most successful product introductions in Par Pharmaceuticals' history. Our Strategy Take advantage of the 505(b)(2) regulatory pathway in order to enter the market no later than the first generic drug. We intend to enter the market no later than the first generic of the branded reference drug. During this period, the number of competitors is lowest and branded drugs are generally at peak or near peak value. This will allow us to influence usage patterns and market our products as improved versions in terms of potential for longer stability, shorter infusion time, less waste and/or ease and safety of use for healthcare professionals, thereby achieving favorable pricing. Even if we enter the market simultaneously with, or after, the first generic drug, as a 505(b)(2) applicant, we would be able to enter the market without regard to any generic drug's 180-day exclusivity period. Retain commercial rights in the United States and selectively partner outside of the United States. We believe that we can cost-effectively commercialize our products in the United States and thereby retain full commercial value of these products. We plan to establish a small, specialty sales force that will focus on group purchasing organizations, hospital systems and key stakeholders in acute care settings, primarily hospitals and infusion centers. Strengthen our product portfolio. We intend to continue to strengthen our product portfolio in the areas of oncology, critical care and orphan diseases. We will continue to develop our current product portfolio and leverage our expertise to identify new products with suboptimal characteristics that present us with significant opportunity for revenue generation. In addition to our internal efforts, we will opportunistically in-license or acquire product candidates that fit our therapeutic areas of focus and meet our rigorous evaluation process. Continue to build our robust intellectual property portfolio. We are the owner or exclusive licensee of a patent estate consisting primarily of formulation and method-of-use patents. We intend to continue to build our patent portfolio by filing for patent protection on new developments with respect to product candidates that will not infringe patents that cover the branded reference drugs. We expect these patents will, if issued, allow us to list our own patents in the Orange Book, which will offer us the potential to trigger our own 30-month stay under the Hatch-Waxman Act against future 505(b)(2) and ANDA filers that reference our drugs, if approved. Our Market Opportunity We believe there is a large and unmet market need for improved injectable drugs that address the specific needs of patients, physicians, nurses, and pharmacists to simplify their use, reduce waste, increase shelf life and lower healthcare costs. Based on market data, we estimate that the U.S. generic injectable industry reported approximately $7.0 billion in sales in 2012 and grew at a compound annual growth rate of 17% over the last five $ per share Eagle Pharmaceuticals, Inc. is offering 3,333,333 shares. We anticipate that the initial public offering price will be between $14.00 and $16.00 per share. This is our initial public offering and no public market exists for our shares. Proposed trading symbol: EGRX Table of Contents years. Based on industry data, we believe that the U.S. generic injectable market will continue to grow at a compound annual growth rate of 11.6% due to several factors, including (i) label expansion for approved products increasing the patient pool for such products, (ii) a pipeline of injectable medications at various stages of clinical development, and (iii) the increasing incidence of certain diseases that necessarily utilize injectable medications such as cancer and autoimmune disorders.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0000904973_revo_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0000904973_revo_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..6fd1b31a26ec10bc1fd1e216e073634da63e7929
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0000904973_revo_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0000911148_cadus-corp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0000911148_cadus-corp_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..aa68b1b2c48e6b857dd1bc6ccb040b846d4929da
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0000911148_cadus-corp_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights and is qualified in its entirety by information contained elsewhere in this document. You should read this entire document carefully, including the section entitled "Risk Factors" and our financial statements and the related notes included elsewhere in this document or incorporated by reference herein. Unless the context otherwise requires, "Cadus", the "Company," "we," "our," "us" and similar expressions refer to Cadus Corporation and its subsidiaries, and the term "common stock" means Cadus Corporation's common stock, par value $0.01 per share. OUR COMPANY Cadus Corporation was incorporated under the laws of the State of Delaware in January 1992 and until July 30, 1999 devoted substantially all of its resources to the development and application of novel yeast-based and other drug discovery technologies. On July 30, 1999, the Company sold its drug discovery assets to OSI Pharmaceuticals, Inc. ("OSI") and ceased its internal drug discovery operations and research efforts for collaborative partners. Cadus Corporation has a wholly owned subsidiary, Cadus Technologies, Inc. ("Cadus Technologies"), which holds all patents, patent applications, know how, licenses and drug discovery technologies of the Company. Subsequent to the sale of its drug discovery assets to OSI, the Company had continued to license, and seek to license, its technologies. It also sought to use all or a portion of its available cash, and where appropriate, seek additional debt or equity financing, to acquire or invest in one or more companies or other assets. However, the Company has received no revenues from the licensing of its technologies since 2010, has not entered into a new license for its technologies since 2000, and although it has pursued a number of prospective acquisitions, none was consummated. Although the Company will continue to consider various acquisitions or investments, it believes that there may be opportunities to profit from purchasing land and residential homes for construction or renovation and resale in areas of the United States where there may be increases in real estate value. In that connection, beginning in the fourth quarter of 2013, Cadus Corporation s Board of Directors began to explore such opportunities in Florida and determined that the Company should seek to purchase individual homes or individual residential lots for purposes of renovation or construction and resale. Cadus formed directly or indirectly wholly-owned subsidiaries through which it would purchase such homes and lots for such purposes. The Company currently intends to concentrate its real estate acquisition, renovation and construction activities in Florida and bought its first residential properties in that state in February 2014. When individual homes are purchased, Cadus intends, as appropriate, to renovate them for resale or to demolish them for new home construction. When vacant lots are purchased, Cadus intends to construct new homes on them. While renovation or demolition may begin soon after an acquisition of a home is consummated, Cadus does not intend to begin construction of new homes until a number of properties intended for new home construction are acquired. In some cases Cadus may also acquire partially constructed or renovated homes for completion and resale or resell acquired homes or land without undertaking renovation or construction. Depending on the availability of transactions acceptable to Cadus, all of Cadus available cash may be utilized, and Cadus may seek debt or equity financing. Cadus may also continue to maintain and seek to license or sell its drug discovery technologies, but this will no longer be a focus of Cadus business plan. In addition, Cadus will continue to consider other acquisitions or investments in various industries. Our common stock is traded in the over-the-counter market and is quoted on the OTC Bulletin Board under the symbol "KDUS.OB." We are headquartered in New York, New York. The mailing address of our headquarters is 767 Fifth Avenue, New York, New York 10153 and our telephone number is (212) 702-4300 THE RIGHTS OFFERING RIGHTS We will distribute to each stockholder of record on April 28, 2014, at no charge, one non-transferable subscription right for each share of our common stock then owned. The rights will be evidenced by non-transferable rights certificates. If and to the extent that our stockholders exercise their right to purchase our common stock we will issue up to 13,144,040 shares and receive gross proceeds of up to $20,110,381.20 in the rights offering. SUBSCRIPTION RIGHTS Each subscription right will entitle the holder to purchase one share of our common stock for $1.53, the subscription price. SUBSCRIPTION PRICE $1.53 per share. RECORD DATE April 28, 2014 EXPIRATION DATE 5:00 p.m., New York City time, on [_______], 2014, subject to extension AMENDMENT, EXTENSION AND TERMINATION We may extend the expiration date at any time after the record date. We may amend or modify the terms of the rights offering. We also reserve the right to terminate the rights offering at any time prior to the expiration date for any reason, in which event all funds received in connection with the rights offering will be returned without interest or deduction to those persons who exercised their subscription rights. NON-TRANSFERABILITY OF RIGHTS The subscription rights are not transferable except to affiliates of the recipient and by operation of law. PROCEDURE FOR EXERCISING SUBSCRIPTION RIGHTS You may exercise your subscription rights by properly completing and executing your rights certificate and delivering it, together with the subscription price for each share of common stock you subscribe for, to the subscription agent on or prior to the expiration date. If you use the mail, we recommend that you use insured, registered mail, return receipt requested. If you cannot deliver your rights certificate to the subscription agent on time, you may follow the guaranteed delivery procedures described under "The Rights Offering—Guaranteed Delivery Procedures" in this prospectus. If you hold shares of our common stock through a broker, custodian bank or other nominee, see "—How Rights Holders Can Exercise Rights Through Others" in this prospectus. NO REVOCATION OR CHANGE Once you submit the form of rights certificate to exercise any subscription rights, you may not revoke or change your exercise or request a refund of monies paid. All exercises of rights are irrevocable, even if you subsequently learn information about us that you consider to be unfavorable. PAYMENT ADJUSTMENTS If you send a payment that is insufficient to purchase the number of shares requested, or if the number of shares requested is not specified in the rights certificate, the payment received will be applied to exercise your subscription rights to the extent of the payment. If the payment exceeds the amount necessary for the full exercise of your subscription rights, the excess will be returned to you as soon as practicable. You will not receive interest or a deduction on any payments refunded to you under the rights offering. OVER-SUBSCRIPTION RIGHTS We do not expect all of our stockholders to exercise all of their basic subscription rights. If you fully exercise your basic subscription right, the over-subscription right of each right entitles you to subscribe for additional shares of our common stock unclaimed by other holders of rights in this offering at the same subscription price per share. If an insufficient number of shares is available to fully satisfy all over-subscription right requests, the available shares will be distributed proportionately among rights holders who exercise their over-subscription right based on the number of shares each rights holder subscribed for under the basic subscription right. The subscription agent will return any excess payments by mail without interest or deduction as soon as practicable after the expiration of the subscription period. LIMITATION ON ABILITY TO EXERCISE RIGHTS We reserve the right to limit the exercise of rights by certain stockholders in order to protect against an unexpected "ownership change" for federal income tax purposes. This may affect our ability to receive gross proceeds of up to approximately $20.1 million in the rights offering. See "The Rights Offering—Protection Mechanics." HOW RIGHTS HOLDERS CAN EXERCISE RIGHTS THROUGH OTHERS If you hold our common stock through a broker, custodian bank or other nominee, we will ask your broker, custodian bank or other nominee to notify you of the rights offering. If you wish to exercise your rights, you will need to have your broker, custodian bank or other nominee act for you. To indicate your decision, you should complete and return to your broker, custodian bank or other nominee the form entitled, "Beneficial Owners Election Form." You should receive this form from your broker, custodian bank or other nominee with the other rights offering materials. You should contact your broker, custodian bank or other nominee if you believe you are entitled to participate in the rights offering but you have not received this form. HOW FOREIGN STOCKHOLDERS AND STOCKHOLDERS WITH APO OR FPO ADDRESSES CAN EXERCISE RIGHTS The subscription agent will not mail rights certificates to you if you are a stockholder whose address is outside the United States or if you have an Army Post Office or a Fleet Post Office address. Instead, we will have the subscription agent hold the subscription rights certificates for your account. To exercise your rights, you must notify the subscription agent prior to 11:00 a.m., New York City time, at least three business days prior to the expiration date, and establish to the satisfaction of the subscription agent that it is permitted to exercise your subscription rights under applicable law. If you do not follow these procedures by such time, your rights will expire and will have no value. MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES A holder should not recognize income or loss for United States Federal income tax purposes in connection with the receipt or exercise of subscription rights in the rights offering. For a detailed discussion, see "Certain U.S. Federal Income Tax Consequences." You should consult your tax advisor as to the particular consequences to you of the rights offering. ISSUANCE OF OUR COMMON STOCK We will issue certificates representing shares purchased in the rights offering as soon as practicable after the expiration date. NO RECOMMENDATION TO RIGHTS HOLDERS We are not making any recommendations as to whether or not you should subscribe for shares of our common stock. You should decide whether to subscribe for shares based upon your own assessment of your best interests. USE OF PROCEEDS The net proceeds from the rights offering will be used for anticipated working capital needs and general corporate purposes. We may use all or a portion of the net proceeds (i) to purchase individual homes or individual residential lots for purposes of renovation or construction and resale or (ii) to acquire or invest in other businesses or assets. Although the Company has entered, and intends to continue to enter, into agreements in the ordinary course for the acquisition of residential properties in Florida, we currently have no definitive agreements nor are we in discussions to acquire or invest in any other businesses or assets. SUBSCRIPTION AGENT American Stock Transfer & Trust Company, LLC For additional information concerning the rights offering, see the section entitled "The Rights Offering." RISK FACTORS Before investing in our common stock, you should carefully read and consider the information set forth in "Risk Factors" beginning on page 12 and all other information appearing elsewhere and incorporated by reference in this prospectus and any accompanying prospectus supplement.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0000941436_modern_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0000941436_modern_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0000941436_modern_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001042074_cymabay_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001042074_cymabay_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001042074_cymabay_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001047881_talon_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001047881_talon_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..53277694cbc00aea68f7e34bd5e1a091efddc1c4
--- /dev/null
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+PROSPECTUS SUMMARY This summary highlights selected information contained in greater detail elsewhere in this prospectus. You should read the entire prospectus carefully before making an investment decision, including Risk Factors and the financial information relating to us included in our filings with the SEC and incorporated by reference into this prospectus. Overview Talon designs, manufactures, sells and distributes apparel zippers, various apparel trim products and specialty waistbands, shirt collars and other apparel components to manufacturers of fashion apparel, specialty retailers and mass merchandisers. We sell and market these products under various branded names including Talon and Tekfit . As a result, we operate the business globally under three product groups Talon Zipper, Talon Trim and Talon Tekfit. We pursue the global expansion of our business through the establishment of Talon owned sales and distribution locations, and strategic manufacturing relationships. The manufacturing arrangements, in combination with Talon owned and affiliated facilities under the Talon brand, improve our time-to-market throughout the world by sourcing, finishing and distributing to apparel manufacturers in their local markets. Our primary business focus is on serving as an outsourced apparel Talon zipper and Talon trim supplier, product design and development, sampling and sourcing department for the most demanding brands and retailers. We believe that design differentiation among brands and retailers is a critical marketing tool for our customers. By assisting our customers in the design, development, sampling and sourcing of all apparel components other than fabric and thread, we generally achieve higher margins for our products, create long-term relationships with our customers, grow our sales to a particular customer by serving a larger proportion of their brands and better differentiate our sales and services from those of our competitors. We are expanding our business globally, to better serve our apparel customers in the field, in addition to global brands and retailers. We believe we can lead the industry in apparel accessories by having strong relationships with our brand and retail customers and having a distributed service organization to serve our factory customers globally. Our Talon Tekfit business provides manufacturers with the patented technology, manufacturing know-how, equipment and materials required to produce expandable waistbands, shirt collars and other stretch technology apparel components. Our supply of this product to customers was limited prior to 2012 by a licensing dispute with the technology inventor. In March 2012 we ended the licensing dispute, acquired all U.S. licenses and patents for this product technology, and settled all matters of litigation with the original owner. Following the end of this dispute, we have proceeded to actively expand our marketing and selling efforts of this unique product within the industry. Consequently, the revenues we derived from the sales of products incorporating this stretch technology were substantially limited for the periods prior to settlement of the litigation, and are only recently beginning to be reestablished as we advance our marketing and product introductions to major retailers. Other Information For a complete description of our business, legal proceedings, financial condition, results of operations and other important information, we refer you to our filings with the Securities and Exchange Commission (the SEC ) that are incorporated by reference in this prospectus, including our Annual Report on Form 10-K for the year ended December 31, 2013, and our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2014, June 30, 2014 and September 30, 2014. For instructions on how to find copies of these documents, please see Where You Can Find Additional Information beginning on page 15 of this prospectus. The Offering The following is a brief summary of certain terms of this offering. You should read the entire prospectus carefully, including Risk Factors and the information, including financial information relating to us included in our filings with the SEC and incorporated by reference into this prospectus. Common stock offered 61,111,109 shares by the selling stockholders Common stock outstanding before and after this offering 92,267,831 shares Use of Proceeds We will not receive any of the proceeds from the sale of shares of our common stock by the selling stockholders. See Use of Proceeds.
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+PROSPECTUS SUMMARY Overview Metalico, Inc. and subsidiaries operates thirty-one scrap metal recycling facilities ( Scrap Metal Recycling ), including an aluminum de-oxidizing plant co-located with a scrap metal recycling facility, in a single reportable segment. As of September 30, 2014, due to its anticipated sale, we reclassified our lead metal product fabricating ( Lead Fabricating ) segment, a previously separate reportable segment, as discontinued operations. The sale of our Lead Fabricating operations was subsequently completed on December 1, 2014, as described under Recent Developments Sale of Lead Fabricating Segment below. We market a majority of our products domestically but maintain several international customers. We are one of the largest full-service metal recyclers in Central and Western New York, with twelve recycling facilities located in that regional market. We also have a significant presence in Western Pennsylvania and Eastern Ohio. Our operations primarily involve the collection and processing of ferrous and non-ferrous metals. We collect industrial and obsolete scrap metal, process it into reusable forms and supply the recycled metals to our ultimate consumers that include electric arc furnace mills, integrated steel mills, foundries, secondary smelters, aluminum recyclers and metal brokers. We acquire unprocessed scrap metals primarily in our local and regional markets and sell to consumers nationally and in Canada as well as to exporters and international brokers. Some of the metal commodities we recycle include steel, copper, aluminum, stainless steel, molybdenum, tantalum, platinum, lead and many others. We are also able to supply quantities of scrap aluminum to our aluminum recycling facility, and scrap lead to our lead fabricating subsidiaries. We believe that we provide comprehensive product offerings of both ferrous and non-ferrous scrap metals. Recent Developments Sale of Lead Fabricating Segment On December 1, 2014, we, through certain of our subsidiaries, entered into a series of agreements with affiliated industry buyers for the sale of our Lead Fabricating segment for an aggregate all-cash purchase price of $31.3 million and contemporaneously closed the sale transaction. The sale transaction included all of our operating Lead businesses in Alabama, Illinois and California, together with our owned real estate and leasehold interests in those states used by our Lead facilities. The terms of the sale transaction are described in greater detail in our Current Report on Form 8-K filed with the SEC on December 2, 2014, which is incorporated by reference into this prospectus, including the pro forma financial statements giving effect to the disposition of assets and liabilities in that transaction, which were filed as Exhibit 9.1 thereto. The foregoing summary is qualified in its entirety by reference to the definitive documents relating to the sale transaction, copies of which are filed as Exhibits 10.54, 10.55, 10.56, 10.57 and 10.58 to this registration statement and to that Form 8-K. See the sections of this prospectus entitled Where You Can Find Additional Information and Incorporation of Certain Information by Reference. Debt Restructuring As previously announced, on October 21, 2014, we completed a debt restructuring. In connection with the debt restructuring, in order to induce TPG Specialty Lending, Inc., as the senior secured term loan lender under our Financing Agreement, dated November 21, 2013 (the Financing Agreement ), to enter into an amendment to the Financing Agreement (the Financing Agreement Amendment ), we agreed to pay to such lender a $3,500,000 fee (the Additional Fee ), payable in cash on the Term Loan A Maturity Date (as defined in the Financing Agreement Amendment) or, at the sole option of such lender, convertible in whole or in part (but without duplication) into shares of our common stock pursuant to the terms of the Common Stock Purchase Warrant issued to the lender on October 21, 2014. The warrant has a ten-year term and is exercisable for up to 3,810,146 shares of our common stock at an exercise price of $0.9186 per share. The warrant is also exercisable on a cashless basis. The exercise price and number of shares of common stock issuable upon exercise of the warrant will be subject to adjustment in the event of any stock split, reverse stock split, stock dividend, recapitalization, reorganization or similar transaction, among other events as described in the warrant. The warrant also includes weighted-average anti-dilution protection, with certain exceptions described in the warrant. In the event of a sale of our company, the holder of the warrant has the right, exercisable at its option, to require us to purchase such holder s warrant at a price determined using a Black- Scholes option pricing model as described in the warrant, subject to certain exceptions. In addition, in the event we are unable to issue the shares underlying the warrant to a holder upon exercise as a result of certain events, such holder will be entitled to receive cash in lieu of such shares of common stock issuable upon exercise of the warrant as set forth therein. Moreover, the number of shares of our common stock underlying the warrants is subject to reduction to the extent that any portion of the Additional Fee is paid in cash. As a result, the number of shares that will actually be issued upon exercise of the warrants may be more or less than the number of shares being offered by this prospectus. On October 21, 2014, we also entered into a registration rights agreement with TPG Specialty Lending, Inc. (the Registration Rights Agreement ) requiring us to register for resale 130% of the maximum number of shares of common stock underlying the warrants, including by filing with the SEC and causing the effectiveness of the registration statement relating to this prospectus. Accordingly, this prospectus relates to the resale or other disposition by TPG Specialty Lending, Inc. or any other selling stockholder identified in this prospectus or a prospectus supplement, or their transferees, of the shares of our common stock issuable upon the exercise of such warrants. The terms of the restructuring transaction are described in greater detail in our Current Report on Form 8-K filed with the SEC on October 21, 2014, which is incorporated by reference into this prospectus, and the foregoing summaries of the documents entered into in connection with the restructuring are qualified in their entirety by reference the definitive documents relating to such transactions, copies or forms of which are filed as exhibits to this registration statement and such Form 8-K. See the sections of this prospectus entitled Where You Can Find Additional Information and Incorporation of Certain Information by Reference. Corporate Information Our common stock is listed on NYSE MKT under the symbol MEA. Our principal executive offices are located at 186 North Avenue East, Cranford, New Jersey 07016, and our telephone number is (908) 497-9610. We maintain an Internet website at http://www.metalico.com. We have not incorporated by reference into this prospectus the information in, or that can be accessed through, our website, and you should not consider it to be a part of this prospectus. Table of Contents The information in this prospectus is not complete and may be changed. We and the selling stockholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus Dated December 2, 2014 PROSPECTUS Metalico, Inc. 4,953,190 Shares of Common Stock This prospectus relates to the resale or other disposition by the selling stockholder identified in this prospectus or a prospectus supplement or its transferees of up to an aggregate of 4,953,190 shares of our common stock, $.001 par value per share ( common stock ), which represents 130% of the maximum number of shares of common stock currently underlying certain warrants issued to the selling stockholder as described herein. We are not selling any shares of our common stock under this prospectus and will not receive any proceeds from the sale or other disposition of shares by the selling stockholder, except that we may receive the proceeds of any cash exercises of the warrants, which, if received, would be used by us for general corporate and working capital purposes. The selling stockholder will bear all commissions and discounts, if any, attributable to the sale or other disposition of the shares. We will bear all costs, expenses and fees in connection with the registration of the shares. The selling stockholder may sell or otherwise dispose of the shares of our common stock offered by this prospectus from time to time on terms to be determined at the time of sale through ordinary brokerage transactions or through any other means described in this prospectus under Plan of Distribution. The prices at which the selling stockholder may sell the shares will be determined by the prevailing market price for the shares or in negotiated transactions. Our common stock is listed on NYSE MKT under the symbol MEA. On December 1, 2014, the last reported sale price of our common stock on the American Stock Exchange was $0.3899 per share. Investing in the common stock involves risks that are described in the Risk Factors section beginning on page 3 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2014 Table of Contents Additional Information For additional information related to our business and operations, please refer to the reports filed with the SEC and incorporated herein by reference, including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2013, our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2014, June 30, 2014, and September 30, 2014, and our Current Reports on Form 8-K filed with the SEC since December 31, 2013, each as described under the caption Incorporation of Certain Documents by Reference. The Offering Common stock offered by the selling stockholder Up to 4,953,190 shares of common stock potentially issuable upon exercise of the warrant, subject to certain anti-dilution adjustments. Use of proceeds We will not receive any proceeds from the sale of the shares offered by this prospectus. We may, however, receive the proceeds of any cash exercises of the warrants, which, if received, would be used by us for general corporate and working capital purposes. NYSE MKT trading symbol MEA
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+S-1/A 1 vsym100811s1a.htm UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO 5 TO FORM S-1/A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 VIEW SYSTEMS, INC. (Exact name of registrant as specified in its charter) Nevada (State or other jurisdiction of incorporation or organization) 3670 (Primary Standard Industrial Classification Code Number) 59-2928366 (I.R.S. Employer Identification No.) SEC NO.: 333-194222 1550 Caton Center Drive, Suite E Baltimore, Maryland 21227 (410) 242-8439 (Address, including zip code, and telephone number, Including area code, of registrant s principal executive offices) American Corporate Enterprises, Inc. 123 West Nye Lane, Suite 129 Carson City, Nevada 89708 (775) 884-9380 (Name, address, including zip code, and telephone number, Including area code, of agent for service) As soon as practicable after this Registration Statement is declared effective. (Approximate date of commencement of proposed sale to the public) If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: [x] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [x] Calculation of Registration Fee Title of Each Class of Securities to be Registered Amount to be Registered (1) Proposed Maximum Offering Price Per Unit (2) Proposed Maximum Aggregate Offering Price Amount of Registration Fee (3) Common Stock Shares offered by the Company 100,000,000 $0.04 $4,000,000 $ Shares offered by Selling Stockholders 6,000,000 0.04 $ 240,000 $ Total 106,000,000 0.04 $4,240,000 $ (1) Pursuant to Rule 415(o) of the Securities Act, these securities are being offered by the Company and the Selling Stockholder named herein on a delayed or continuous basis. The offering price has been arbitrarily determined. (2) The offering price has been arbitrarily determined. (3) Estimated solely for the purpose of calculating the registration fee under Rule 457(c) or (g) under the Securities Act of 1933 based on the closing bid quote for our common stock as of May 1, 2014. (4) These are outstanding shares of common stock which may be offered for sale by a Selling Stockholder pursuant to this registration statement on a securities market such as the Over-the-Counter Bulletin Board or other securities exchange at prevailing market prices or privately negotiated prices. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8 (A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. JULY __, 2014 A Total of 106,000,000, Shares of Common Stock Offered for Sale 100,000,000 Shares Offered at $0.04 Per Share by the Company 6,000,000 Shares Offered at Market Price by a Selling Shareholder View Systems, Inc. (the Company ) is offering for sale a total of up to 100,000,000 shares of its common stock, par value $0.001 per share ( Common Stock ) on a "self- underwritten," best efforts basis. The shares will be offered at a price of $.04 per share for a period of at least six months but not more than twelve months from the date of this prospectus, and we may close or terminate the Offering earlier than twelve months. There is no minimum number of shares required to be purchased per investor, and we are not required to sell any minimum number of shares in the offering. Proceeds from the offering will not be placed in escrow or similar type of account and will be immediately available for use by the Company. See "Use of Proceeds" and "Plan of Distribution." We make no prediction how many shares we will sell, and we may not realize enough proceeds to remain in operation. In addition, the certain selling stockholders named in this prospectus (collectively the "Selling Stockholders") are offering for sale from time to time an aggregate each of up to 3,000,000 shares of our Common Stock. If we sell all of the 100,000,000 shares offered by the Company, we will receive $4,000,000 in estimated gross proceeds. The Company expects the net proceeds from the sale of fifty percent (50%) of the shares will sustain its operations for a period of 5 months. We will not receive any of the proceeds from the sale of shares offered by the Selling Stockholder. The shares being offered for resale by the Selling Stockholders will be offered and sold at market prices. If the Selling Shareholders sells all 6,000,000 shares at an estimated $0.04 per share (our market price as of the most recent practicable date), they may realize approximately $240,000. The shares being offered for resale by the Selling Stockholders represent approximately 2,8% of the Company's current issued and outstanding Common Stock. Also, sales of a substantial number of shares of our Common Stock by the Selling Stockholders within a relatively short period of time could have the effect of depressing the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities. The Selling Stockholders and any broker/dealer executing sell orders on behalf of the Selling Stockholders may be deemed to be "underwriters" within the meaning of the Securities Act of 1933, as amended. Commissions received by any broker/dealer may be deemed to be underwriting commissions under the Securities Act. Proceeds received by the Selling Stockholders in excess of $120,000 represent underwriting discounts to the Selling Stockholders. Our common stock is not listed on a national securities exchange or The Nasdaq Stock Market. Our common stock is quoted on the Over the Counter Bulletin Board ( OTCBB ) under the symbol VSYM.OB . THESE SECURITIES ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT. PLEASE REFER TO "RISK FACTORS" BEGINNING ON PAGE 5 WHICH DESCRIBE CERTAIN MATERIAL RISKS YOU SHOULD CONSIDER BEFORE INVESTING AND DILUTION BEGINNING ON PAGE 12 WHICH DESCRIBES THE IMMEDIATE DILUTION THAT INVESTORS IN THIS OFFERING WILL SUFFER. THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE NOT APPROVED OR DISAPPROVED OF THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. [Inside Cover of Prospectus] You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. You should read the entire prospectus before making an investment decision to purchase our Common Stock. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus. This prospectus is not an offer to sell securities in any state where the offer is not permitted. PROSPECTUS SUMMARY The following summary highlights aspects of the offering. This prospectus does not contain all of the information that may be important to you. You should read this entire prospectus carefully, including the Risk Factors section and the financial statements, related notes and the other more detailed information appearing elsewhere in this prospectus before making an investment decision. In this prospectus, unless otherwise indicated, "we," "us," "our" and the "Company" refer to View Systems, Inc. Our Company View Systems, Inc. develops, produces and markets computer software and hardware systems for security and surveillance applications. View Systems was incorporated in Florida on January 25, 1989, as Beneficial Investment Group, Inc. and became active in September 1998 when we began development of our digital video product line and changed the company's name to View Systems, Inc. Starting in 1999 we expanded our business operations through a series of acquisitions of technologies we use in our digital video recorder technology products and in our concealed weapons technology. On July 25, 2003, View Systems incorporated View Systems, Inc. as a wholly-owned Nevada corporation for the sole purpose of changing the domicile of the company from Florida to Nevada. On July 31, 2003, articles of merger were filed with the states of Florida and Nevada to complete the domicile change View Systems, Inc. develops, produces and markets computer software and hardware systems for security and surveillance applications. In 1998 digital video recorder technology was our first developed product and we enhanced this product line by developing interfaces with other various technologies, such as facial recognition, access control cards and control devices such as magnetic locks, alarms and other common security devices. In 2003 we sold this product to various commercial entities including schools, restaurants, night clubs, car washers and car dealers (license plate recognition was incorporated into these types of installations), ranches and gas stations. In these installations we integrated the digital video recorded technology with other electronic devices, and we gained knowledge of the security needs of a wide range of businesses. We expanded our product line in 2002 to include a concealed weapons detection system we call ViewScan. We have penetrated four major market segments for this product: correctional facilities, judicial facilities, probation offices and federal facilities in the Mid-Atlantic States, the West Coast and the South. In 2003 we added a hazardous material first response wireless video transmitting system to our product line we refer to as Visual First Responder. The markets for these units are first responder units for agencies such as the National Guard, Coast Guard, Army, state law enforcement agencies, and fire departments. Both of these technologies were licensed from the U.S. Department of Energy's Idaho National Engineering Laboratory ("INEL"). Until 2005 we assembled all of our products in-house, but we currently contract with third party manufacturers to manufacture some components of our products. Historically, we have relied upon exclusive technology licensing agreements with federal departments to license and distribute the ViewScan technology. In anticipation of the expiration of federal licenses, we developed propriety components and made sufficient engineering design changes to the ViewScan product to lower production costs and to accommodate the price points required by competitive pressures. By redesigning the ViewScan, we offset the impact of the expiration of our license agreements and continued to capitalize on the competitive advantage we had in the markets we had entered. We have a similar strategy for the Visual First Responder, which is now in its third generation. Table of Contents1 Please see DESCRIPTION OF BUSINESS Products and Services - beginning on page 18 for detailed descriptions of our products and services. Although we have established more than one web site to market our products, prospective investors are strongly cautioned that any information appearing on one of our web sites should not be deemed to be a part of this prospectus and should not be utilized in making a decision whether to buy our Common Stock. SUMMARY OF THIS OFFERING Securities Offered By the Company Up to 100,000,000 Shares of our Common Stock are being offered for sale by the Company. Our Common Stock is described in further detail in the section of this prospectus titled DESCRIPTION OF SECURITIES Common Stock. Offering Price We will sell the Shares at $0.04. This price was determined by us arbitrarily. Securities Offered By Selling Stockholders Up to 6,000,000 Shares of our Common Stock owned by Selling Stockholders are included in this Prospectus. The Selling Stockholders are not obligated to sell any Shares. Offering Price The Selling Stockholders may sell their Shares from time to time at market price. Number of shares outstanding before the offering 248,030,860 shares of Common Stock issued and outstanding as of May 21, 2014. Total number of shares of Common Stock outstanding after the offering (if fully subscribed) 348,030,860 shares of Common Stock. Net Proceeds to the Company We intend to accomplish this Offering on a self-underwritten basis directly through our officers, directors and/or employees, who will not be separately compensated therefore. However, we reserve the right to utilize an underwriter in which case we will amend this Prospectus to disclose the material terms of such relationship as they pertain to the offering. Additionally, we estimate that costs of this offering for such items as legal and accounting fees, printing, and SEC registration fees, and other charges will total approximately $30,000. Thus net proceeds to the Company if this offering is fully subscribed without the use of underwriters will be $3,970,000 (assuming $30,000 in Offering expenses are paid). In the event that only 50% of the Shares are sold we will generate net proceeds of $797,000 (assuming $30,000 in Offering expenses are paid). In the event that we only sell 10% of the Shares, we will generate net proceeds of $370,000 (assuming $30,000 in Offering expenses are paid). Use of Proceeds We will use the proceeds from this offering to: (1) facilitate product fulfillment (manufacturing, packaging and shipment), which we anticipate will enable future orders to be self funding; and (2) provide working capital to finance corporate acquisitions and the integration of new technologies. A summary of our intended use of the proceeds of this offering is set forth in the section of this prospectus titled USE OF PROCEEDS Consummation of the offering We will terminate this offering upon the earlier to occur of (1) one year from the effective date of this prospectus, (2) sale of all the Shares being offered, or (3) anytime after a minimum of six months from the date of the Prospectus at our sole discretion if we determine that it is in our best interests to withdraw the offering. Table of Contents2 RISK FACTORS You should carefully consider the risks, uncertainties and other factors described below because they could materially and adversely affect our business, financial condition, operating results and prospects and could negatively affect the market price of our Common Stock. Also, you should be aware that the risks and uncertainties described below are not the only ones facing us. Additional risks and uncertainties that we do not yet know of, or that we currently believe are immaterial, may also impair our business operations and financial results. Our business, financial condition or results of operations could be harmed by any of these risks. The trading price of our Common Stock could decline due to any of these risks, and you may lose all or part of your investment. In assessing these risks you should also refer to the other information contained in or incorporated by reference to our Form 10-K for the year ended December 31, 2013, including our financial statements and the related notes. THERE IS NO MINIMUM NUMBER OF SHARES THAT MUST BE SOLD AND NO ASSURANCE THAT THE PROCEEDS FROM THE SALE OF SHARES WILL ALLOW THE COMPANY TO MEET ITS GOALS. We are selling our Shares on a best efforts basis, and there is no minimum number of Shares that must be sold by us in this Offering. Similarly, there are no minimum purchase requirements. We do not have an underwriter, and no party has made a firm commitment to buy any or all of our securities. We intend to sell the Shares through our employees, officers and directors, who will not be separately compensated for their efforts. Even if we only raise a nominal amount of money, we will not refund any funds to you. Any money we do receive will be immediately used by us for our business purposes. Upon completion of this Offering, we intend to utilize the net proceeds to finance our business operations. While we believe that the net proceeds from the sale of all Shares in this Offering will enable us to meet our business plans and enable us to operate as other than a going concern, there can be no assurance that all these goals can be achieved. Moreover if less than all of the Shares are sold, management will be required to adjust its plans and allocate proceeds in a manner which it believes, in our sole discretion, will be in our best interests. It is highly likely that if not all of the Shares are sold there will be a need for additional financing in the future, without which our ability to operate as other than a going concern may be jeopardized. No assurance whatsoever can be given or is made that such additional financing, if and when needed, will be available or that it can be obtained on terms favorable to us. Accordingly you may be investing in a company that does not have adequate funds to conduct its operations. If that happens, you will suffer a loss of your investment. WE NEED ADDITIONAL EXTERNAL CAPITAL AND IF WE ARE UNABLE TO RAISE SUFFICIENT CAPITAL TO FUND OUR PLANS, WE MAY BE FORCED TO DELAY OR CEASE OPERATIONS. The funds to be raised in this offering will not meet all of our needs. Based on our current growth plan we believe we may require approximately $1,200,000 in additional financing within the next twelve months to develop our sales channels, of which the $1,000,000 sought in this offering is intended to be a substantial part. Our success will depend upon our ability to access equity capital markets and borrow on terms that are financially advantageous to us. However, we may not be able to obtain additional funds on acceptable terms. If we fail to obtain funds on acceptable terms, then we might be forced to delay or abandon some or all of our business plans or may not have sufficient working capital to develop products, finance acquisitions, or pursue business opportunities. If we borrow funds, then we could be forced to use a large portion of our cash reserves, if any, to repay principal and interest on those loans. If we issue our securities for capital, then the interests of investors and stockholders will be diluted. Table of Contents3 WE HAVE EXPERIENCED HISTORICAL LOSSES AND A SUBSTANTIAL ACCUMULATED DEFICIT. IF WE ARE UNABLE TO REVERSE THIS TREND, WE WILL LIKELY BE FORCED TO CEASE OPERATIONS. We have incurred losses for the past two fiscal years which consist of a net loss of $2,008,101 for 2013 and a net loss of $888,022 for 2012. In addition, we had an accumulated deficit of $27,611,046 at December 31, 2013, as compared with $25,602,945 at December 31, 2012. We also incurred a net loss for the three month period ended March 31, 2014 of $379,011. Further, we do not expect positive cash flow from operations in the near term. There is no assurance that actual cash requirements will not exceed our estimates. In particular, additional capital will be required for future periods for: (i) new product development expenses; (ii) potential marketing costs and professional fees; or (iii) we encounter greater costs associated with general and administrative expenses or offering costs. As a result, we are unable to predict whether we will achieve profitability in the future, or at all. The uncertainty and factors described throughout this section may impede our ability to economically develop, produce, and market our products effectively. As a result, we may not be able to achieve or sustain profitability or positive cash flows from operating activities in the future. WE HAVE A WORKING CAPITAL DEFICIT AND SIGNIFICANT CAPITAL REQUIREMENTS. SINCE WE WILL CONTINUE TO INCUR LOSSES UNTIL WE ARE ABLE TO GENERATE SUFFICIENT REVENUES TO OFFSET OUR EXPENSES, INVESTORS MAY BE UNABLE TO SELL OUR SHARES AT A PROFIT OR AT ALL. We had a net loss of $379,011 and $2,008,101 for the three month period ended March 31, 2014 and fiscal year ended December 31, 2013 and net cash used in operations of $81,845 and $784,570 for the three month period ended March 31, 2014 and fiscal year ended December 31, 2013, respectively. Because we have not yet achieved or acquired sufficient operating capital and given these financial results along with our expected cash requirements in 2014, additional capital investment will be necessary to develop and sustain our operations. OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM HAS RAISED DOUBT OVER OUR ABILITY TO CONTINUE AS A GOING CONCERN. The independent registered public accounting firm s report accompanying our December 31, 2013 and 2012 audited financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that the Company will continue as a going concern." Our ability to continue as a going concern is dependent on raising additional capital to fund our operations and ultimately on generating future profitable operations. There can be no assurance that we will be able to raise sufficient additional capital or eventually have positive cash flow from operations to address all of our cash flow needs. If we are not able to find alternative sources of cash or generate positive cash flow from operations, our business and shareholders will be materially and adversely affected We have incurred substantial operating and net losses, as well as negative operating cash flow and do not have financing commitments in place to meet expected cash requirements for the next twelve months. Our net loss for the three month period ended March 31, 2014 was $379,011, for fiscal year ended December 31, 2013 was $2,008,101 and for fiscal year ended December 31, 2012 was $888,022. Our retained deficit was $27,611,046 at December 31, 2013. We are unable to fund our day-to-day operations through revenues alone, and management believes we will incur operating losses for the near future while we expand our sales channels. While we have expanded our product line and expect to establish new sales channels, we may be unable to increase revenues to the point that we attain and are able to maintain profitability. We have had to rely on private financing to cover cash shortfalls. As a result, we continue to have significant working capital and stockholders' deficits including a substantial accumulated deficit at December 31, 2013. In recognition of such, our independent registered public accounting firms have included an explanatory paragraph in their respective reports on our consolidated financial statements for the fiscal years ended December 31, 2013, and December 31, 2012 that expressed substantial doubt regarding our ability to continue as a going concern. Table of Contents4 WE NEED ADDITIONAL EXTERNAL CAPITAL AND IF WE ARE UNABLE TO RAISE SUFFICIENT CAPITAL TO FUND OUR PLANS, WE MAY BE FORCED TO DELAY OR CEASE OPERATIONS. Based on our current growth plan we believe we may require approximately $1,200,000 in additional financing within the next twelve months to develop our sales channels. Furthermore, if the cost of our development, production and marketing programs are greater than anticipated, we may have to seek additional funds through public or private share offerings or arrangements with corporate partners. There can be no assurance that we will be successful in our efforts to raise these required funds, or on terms satisfactory to us. Our success will depend upon our ability to access equity capital markets and borrow on terms that are financially advantageous to us. However, we may not be able to obtain additional funds on acceptable terms. If we fail to obtain funds on acceptable terms, then we might be forced to delay or abandon some or all of our business plans or may not have sufficient working capital to develop products, finance acquisitions, or pursue business opportunities. If we borrow funds, then we could be forced to use a large portion of our cash reserves, if any, to repay principal and interest on those loans. If we issue our securities for capital, then the interests of investors and stockholders will be diluted. We are attempting to raise at least $1 million through an offering of securities. WE ARE CURRENTLY DEPENDENT ON THE EFFORTS OF RESELLERS FOR OUR CONTINUED GROWTH AND MUST EXPAND OUR SALES CHANNELS TO INCREASE OUR REVENUES AND FURTHER DEVELOP OUR BUSINESS PLANS. OUR FUTURE GROWTH AND PROFITABILITY MAY DEPEND UPON THE EFFECTIVENESS AND EFFICIENCY OF OUR MARKETING EXPENDITURES IN RECRUITING NEW CUSTOMERS. We are in the process of developing and expanding our sales channels, but we expect overall sales to remain down as we develop these sales channels. We are actively recruiting additional resellers and dealers and have hired in-house sales personnel for regional and national sales. We must continue to find other methods of distribution to increase our sales. If we are unsuccessful in developing sales channels we may have to abandon our business plan. Moreover, our future growth and profitability will depend in large part upon the effectiveness and efficiency of our marketing expenditures, including our ability to: (i) create greater awareness of our ViewScan products and band name; (ii) identify the most effective and efficient level of spending in each market, media and specific media vehicle; (iii) determine the appropriate message and media mix for advertising, marketing and promotional expenditures; (iv) effectively manage marketing costs, including creative and media expense in order to generate and maintain acceptable costs; (v) generate leads for sales, including obtaining lists of businesses in a cost-effective manner; and (vi) drive traffic to our website. WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY IN OUR MARKET BECAUSE WE HAVE A SMALL MARKET SHARE AND COMPETE WITH LARGE NATIONAL AND INTERNATIONAL COMPANIES. We estimate that we have less than a 1% market share of the surveillance and weapons detection market. We compete with many companies that have greater brand name recognition and significantly greater financial, technical, marketing, and managerial resources. The position of these competitors in the market may prevent us from capturing more market share. We intend to remain competitive by increasing our existing business through marketing efforts, selectively acquiring complementary technologies or businesses and services, increasing our efficiency, and reducing costs. Table of Contents5 WE MUST SUCCESSFULLY INTRODUCE NEW OR ENHANCED PRODUCTS AND MANAGE THE COSTS ASSOCIATED WITH PRODUCING SEVERAL PRODUCT LINES TO BE SUCCESSFUL. WE OPERATE IN A MARKET WHICH IS SUBJECT TO RAPID TECHNOLOGICAL AND OTHER CHANGES AND INCREASING COMPETITION COULD LEAD TO PRICING PRESSURES, REDUCED OPERATING MARGINS, LOSS OF MARKET SHARE AND INCREASED CAPITAL EXPENDITURES. Our future success depends on our ability to continue to improve our existing products and to develop new products using the latest technology that can satisfy customer needs. For example, our short term success will depend on the continued acceptance of the Multi-Mission Mobil Video and the ViewScan portal product line. We cannot be certain that we will be successful at producing multiple product lines and we may find that the cost of production of multiple product lines inhibits our ability to maintain or improve our gross profit margins. In addition, the failure of our products to gain or maintain market acceptance or our failure to successfully manage our cost of production could adversely affect our financial condition. The markets for our ViewScan products is highly competitive and we expect increased competition in the future that could adversely affect our revenue and market share. Larger established companies with high brand recognition may develop products and services that are competitive with our core products and services. These competitors may be able to devote greater resources than us to the development, promotion and sale of their products and services and respond more quickly than we can to new technologies or changes. We may not be able to compete effectively with current or future competitors, especially those with significantly greater resources or more established customer bases, which may materially adversely affect our sales and our business. PROTECTION OF OUR INTELLECTUAL PROPERTY IS LIMITED AND ANY MISUSE OF OUR INTELLECTUAL PROPERTY BY OTHRES COULD HARM OUR BUSINESS, REPUTATION AND COMPETITIVE POSITION. Our trademarks, copyrights, trade secrets, trade dress and designs are valuable and integral to our success and competitive position. However, we cannot assure you that we will be able to adequately protect our proprietary rights through reliance on a combination of copyrights, trademarks, trade secrets, confidentiality procedures, contractual provisions and technical measures from outside influences. Protection of trade secrets and other intellectual property rights in the markets in which we operate and compete is highly uncertain and may involve complex legal questions. We cannot completely prevent the unauthorized use or infringement of our intellectual property rights, as such prevention is inherently difficult. We also expect that the more successful we are, the more likely that competitors will try to illegally use our proprietary information and develop products that are similar to ours, which may infringe on our proprietary rights. In addition, we could potentially lose future trade secret protection for our source code if any unauthorized disclosure of such code occurs. The loss of future trade secret protection could make it easier for third parties to compete with our products by copying functionality. Any changes in, or unexpected interpretations of, the trade secret and other intellectual property laws in any country in which we operate may compromise our ability to enforce our trade secret and intellectual property rights. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our confidential information and trade secret protection. If we are unable to protect our proprietary rights or if third parties independently develop or gain access to our or similar technologies, our business, service revenue, reputation and competitive position could be materially adversely affected. THE CONFIDENTIALITY, NON-DISCLOSURE AND OTHER AGREEMENTS WE USE TO PROTECT OUR PRODUCTS, TRADE SECRETS AND PROPRIETARY INFORMATION MAY PROVE UNENFORCEABLE OR INADEQUATE. We protect our products, trade secrets and proprietary information, in part, by requiring all of our employees and consultants to enter into agreements providing for the maintenance of confidentiality. We also enter into non-disclosure agreements with our technical consultants to protect our confidential and proprietary information. We cannot assure you that our confidentiality agreements with our employees, consultants and other third parties will not be breached, that we will be able to effectively enforce these agreements, that we will have adequate remedies for any breach, or that our trade secrets and other proprietary information will not be disclosed or will otherwise be protected. Table of Contents6 WE HAVE NOT REGISTERED COPYRIGHTS FOR OUR VIEWSCAN PRODUCTS, WHICH MAY LIMIT OUR ABILITY TO ENFORCE THEM. We have not registered our copyrights in all of our materials, website information, designs or other copyrightable works. The United States Copyright Act automatically protects all of our copyrightable works, but without registration we cannot enforce those copyrights against infringers or seek certain statutory remedies for any such infringement. Preventing others from copying our products, written materials and other copyrightable works is important to our overall success in the marketplace. In the event we decide to enforce any of our copyrights against infringers, we will first be required to register the relevant copyrights, and we cannot be sure that all of the material for which we seek copyright registration would be registrable in whole or in part, or that once registered, we would be successful in bringing a copyright claim against any such infringers. THE SUCCESS OF OUR BUSINESS DEPENDS UPON THE CONTINUING CONTRIBUTION OF OUR KEY PERSONNEL, INCLUDING MR. GUNTHER THAN, OUR CHIEF EXECUTIVE OFFICER, WHOSE KNOWLEDGE OF OUR BUSINESS WOULD BE DIFFICULT TO REPLACE IN THE EVENT WE LOSE HIS SERVICES. We are dependent on the services of Gunther Than, our Chief Executive Officer, and a member of our Board and our other executive officers and members of our senior management team. For example, the loss of Mr. Than could damage customer relations and could restrict our ability to raise additional working capital if and when needed. There can be no assurance that Mr. Than will continue in his present capacity for any particular period of time. Other than non-compete provisions of limited duration included in employment agreements that we may or will have with certain executives, we do not generally seek non-compete agreements with key personnel, and they may leave and subsequently compete against us. The loss of service of any of our senior management team, particularly those who are not party to employment agreements with us, or our failure to attract and retain other qualified and experienced personnel on acceptable terms, could have a material adverse effect on our business. WE MAY BE UNABLE TO ATTRACT AND RETAIN THE SKILLED EMPLOYEES NEEDED TO SUSTAIN AND GROW OUR BUSINESS. Our success to date has largely depended on, and will continue to depend on, the skills, efforts and motivations of our executive team and employees, who generally have significant experience with our Company. Our success also depends largely on our ability to attract and retain highly qualified IT engineers and programmers, to train professionals and sales and marketing managers and corporate management personnel. We may experience difficulties in locating and hiring qualified personnel and in retaining such personnel once hired, which may materially and adversely affect our business. OUR DIRECTORS AND OFFICERS ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE OVER MATTERS REQUIRING STOCKHOLDER APPROVAL. Currently, we have 248,030,860 shares of common stock issued and outstanding and 3,489,647 shares of preferred stock issued and outstanding. Currently, our directors and executive officers collectively hold approximately 21.96% of the voting power of our common and 59.88% of the preferred stock entitled to vote on any matter brought to a vote of the stockholders. Including the effects of Gunther Than s, our Chief Executive Officer's voting preferred stock, our directors and officers have the power to vote approximately 81.84% of common shares (based on the assumed effects of conversion of all of Mr. Than s preferred stock) as of the date of this Prospectus.. Pursuant to Nevada law and our bylaws, the holders of a majority of our voting stock may authorize or take corporate action with only a notice provided to our stockholders. A stockholder vote may not be made available to our minority stockholders, and in any event, a stockholder vote would be controlled by the majority stockholders. OUR OFFICER AND DIRECTORS MAY BE SUBJECT TO CONFLICTS OF INTEREST. Some of our officers and directors serve only part time and can become subject to conflicts of interest. Some devote part of their working time to other business endeavors, including consulting relationships with other entities, and have responsibilities to these other entities. Such conflicts include deciding how much time to devote to our affairs, as well as what business opportunities should be presented to us. Because of these relationships, our officers and directors could be subject to conflicts of interest. Currently, we have no policy in place to address such conflicts of interest. Table of Contents7 NEVADA LAW AND OUR ARTICLES OF INCORPORATION MAY PROTECT OUR DIRECTORS FROM CERTAIN TYPES OF LAWSUITS. Nevada law provides that our officers and directors will not be liable to us or our stockholders for monetary damages for all but certain types of conduct as officers and directors. Our Bylaws permit us broad indemnification powers to all persons against all damages incurred in connection with our business to the fullest extent provided or allowed by law. The exculpation provisions may have the effect of preventing stockholders from recovering damages against our officers and directors caused by their negligence, poor judgment or other circumstances. The indemnification provisions may require us to use our limited assets to defend our officers and directors against claims, including claims arising out of their negligence, poor judgment, or other circumstances. WE HAVE IDENTIFIED MATERIAL WEAKNESSES IN OUR INTERNAL CONTROL OVER FINANCIAL REPORTING, AND OUR BUSINESS AND STOCK PRICE MAY BE ADVERSELY AFFECTED IF WE DO NOT ADEQUATELY ADDRESS THOSE WEAKNESSES OR IF WE HAVE OTHER MATERIAL WEAKNESSES OR SIGNIFICANT DEFICIENCIES IN OUR INTERNAL CONTROL OVER FINANCIAL REPORTING. WE HAVE IDENTIFIED MATERIAL WEAKNESSES IN OUR INTERNAL CONTROL OVER FINANCIAL REPORTING, AND OUR BUSINESS AND STOCK PRICE MAY BE ADVERSELY AFFECTED IF WE DO NOT ADEQUATELY ADDRESS THOSE WEAKNESSES OR IF WE HAVE OTHER MATERIAL WEAKNESSES OR SIGNIFICANT DEFICIENCIES IN OUR INTERNAL CONTROL OVER FINANCIAL REPORTING. For fiscal year ended 2012, we did not adequately implement certain internal controls, particularly with respect to revenue reporting, and made certain other accounting errors in our financial statements for the year ended December 31, 2010 and for the interim periods of March 31, 2011, June 30, 2011, and September 30, 2011. Due to accounting errors, we had to restate our financial statements as of and for the period ended December 31, 2010 to reflect the correction of: (i) an understatement of deferred income that resulted from incorrectly allocating the revenue received under extended warranty arrangements over the life of the warranty; (ii) an overstatement of revenue due to recognition of sales prior to the installation of the products, and (iii) the classification of common stock that was issued to the holder of a note payable. As a result of reducing sales revenue there was a corresponding reduction in cost of sales and accounts payable. We had originally recorded the issuance of the stock as a payment in full for the note and related costs. However, after a further review of the legal documents, it was determined that the debt was not satisfied but instead the ultimate resolution of the debt was contingent on events that were still unfolding. Because of the errors that are being corrected, we have restated our belief that our internal controls over financial reporting were effective to conclude that they were not effective. Although we have taken steps to correct our identified material weaknesses in our internal controls and have revised our interim financial disclosures for periods in 2011, the existence of these or possibly other material weaknesses or significant deficiencies raises concerns that the prevention of future errors could require the allocation of scarce financial resources at times when such resources may not be available to us. As of the date of this Annual Report, we believe we have corrected any material weaknesses in our internal controls. If we cannot produce reliable financial reports, investors could lose confidence in our reported financial information; the market price of our stock could decline significantly; we may be unable to obtain additional financing to operate and expand our business, and our business and financial condition could be harmed. For fiscal year ended December 31, 2012, we have remedied our control deficiencies over our revenue recognition. In 2013, we identified a material weakness because we did not currently employ a sufficient number of qualified accounting personnel to ensure proper and timely evaluation of complex accounting, tax, and disclosure issues that may arise during the course of our business. We intend to address this material weakness by reviewing our business. We intend to address this material weakness by reviewing our accounting and finance processes to identify any improvements thereto that might enhance our disclosure controls and procedures and our internal control over financial reporting and determine the feasibility of implementing such improvements and by seeking qualified employees and/or outside consultants who possess the knowledge needed to eliminate this weakness. Our ability to remediate this weakness may, however, be delayed or limited by resource constraints, a lack of qualified persons in our market area and/or competition from other employers. Table of Contents8 FAILURE TO MAINTAIN EFFECTIVE INTERNAL CONTROLS IN ACCORDANCE WITH SECTION 404 OF THE SARBANES-OXLEY ACT WOULD LEAD TO LOSS OF INVESTOR CONFIDENCE IN OUR REPORTED FINANCIAL INFORMATION. Pursuant to proposals related to Section 404 of the Sarbanes-Oxley Act of 2002, beginning with our Annual Report on Amendment No. 2 to Form 10-K for the fiscal year ending December 31, 2008, we have been required to furnish a report by our management on our internal control over financial reporting. If we cannot provide reliable financial reports or prevent fraud, then our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our stock could drop significantly. To maintain compliance with Section 404 of the Act, we engage in a process to document and evaluate our internal control over financial reporting, which is both costly and challenging and requires management to dedicate scarce internal resources and to retain outside consultants. During the course of our testing, we may identify deficiencies which we may not be able to remediate in time for securities disclosure reporting deadlines. In addition, if we fail to maintain the adequacy of our internal controls, as such standards are modified, supplemented or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. Moreover, effective internal controls, particularly those related to revenue recognition, are necessary for us to produce reliable financial reports and are important to helping prevent financial fraud. THERE IS NO SIGNIFICANT ACTIVE TRADING MARKET FOR OUR SHARES, AND IF AN ACTIVE TRADING MARKET DOES NOT DEVELOP, PURCHASERS OF OUR SHARES MAY BE UNABLE TO SELL THEM PUBLICLY. There is no significant active trading market for our shares, and we do not know if an active trading market will develop. An active market will not develop unless broker-dealers develop interest in trading our shares, and we may be unable to generate interest in our shares among broker-dealers until we generate meaningful revenues and profits from operations. Until that time occurs, if it does at all, purchasers of our shares may be unable to sell them publicly. In the absence of an active trading market: Investors may have difficulty buying and selling our shares or obtaining market quotations; Market visibility for our common stock may be limited; and A lack of visibility for our common stock may depress the market price for our shares. Moreover, the market price for our shares is likely to be highly volatile and subject to wide fluctuations in response to various factors, including the following: (i) actual or anticipated fluctuations in our quarterly operating results and revisions to our expected results; (ii) changes in financial estimates by securities research analysts; (iii) conditions in the market for our products; (iv) changes in the economic performance or market valuations of companies specializing in the defense industries; (v) announcements by us or our competitors of new services, strategic relationships, joint ventures or capital commitments; (vi) addition or departure of key personnel; (vii) litigation related to any intellectual property; and (viii) sales or perceived potential sales of our shares. In addition, the securities market has from time to time, and to an even greater degree since the last quarter of 2007, experienced significant price and volume fluctuations that are not related to the operating performance of particular companies. These market fluctuations may also have a material adverse effect on the market price of our ordinary shares. Furthermore, in the past, following periods of volatility in the market price of a public company s securities, shareholders have frequently instituted securities class action litigation against that company. Litigation of this kind could result in substantial costs and a diversion of our management s attention and resources. Table of Contents9 OUR COMMON STOCK IS CONSIDERED TO BE "PENNY STOCK." Our common stock is considered to be a "penny stock" because it meets one or more of the definitions in Rules 15g-2 through 15g-6 promulgated under Section 15(g) of the Securities Exchange Act of 1934, as amended. These include but are not limited to, the following: (i) the stock trades at a price less than $5.00 per share; (ii) it is not traded on a "recognized" national exchange; (iii) it is not quoted on The NASDAQ Stock Market, or even if quoted, has a price less than $5.00 per share; or (iv) is issued by a company with net tangible assets less than $2.0 million, if in business more than a continuous three years, or with average revenues of less than $6.0 million for the past three years. The principal result or effect of being designated a "penny stock" is that securities broker-dealers cannot recommend the stock but must trade it on an unsolicited basis. The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks." Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules. If a trading market for our common stock develops, our common stock will probably become subject to the penny stock rules, and shareholders may have difficulty in selling their shares. BROKER-DEALER REQUIREMENTS MAY AFFECT TRADING AND LIQUIDITY. Section 15(g) of the Securities Exchange Act of 1934, as amended, and Rule 15g-2 promulgated thereunder by the SEC require broker-dealers dealing in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed and dated written receipt of the document before effecting any transaction in a penny stock for the investor's account. Potential investors in our common stock are urged to obtain and read such disclosure carefully before purchasing any shares that are deemed to be "penny stocks." Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the account of any investor for transactions in such stocks before selling any penny stock to that investor. This procedure requires the broker-dealer to (i) obtain from the investor information concerning his or her financial situation, investment experience and investment objectives; (ii) reasonably determine, based on that information, that transactions in penny stocks are suitable for the investor and that the investor has sufficient knowledge and experience as to be reasonably capable of evaluating the risks of penny stock transactions; (iii) provide the investor with a written statement setting forth the basis on which the broker-dealer made the determination in (ii) above; and (iv) receive a signed and dated copy of such statement from the investor, confirming that it accurately reflects the investor's financial situation, investment experience and investment objectives. Compliance with these requirements may make it more difficult for holders of our common stock to resell their shares to third parties or to otherwise dispose of them in the market or otherwise. OUR COMMON STOCK MAY BE VOLATILE, WHICH SUBSTANTIALLY INCREASES THE RISK THAT YOU MAY NOT BE ABLE TO SELL YOUR SHARES AT OR ABOVE THE PRICE THAT YOU MAY PAY FOR THE SHARES. Because of the limited trading market for our common stock, and because of the possible price volatility, you may not be able to sell your shares of common stock when you desire to do so. The inability to sell your shares in a rapidly declining market may substantially increase your risk of loss because of such illiquidity and because the price for our common stock may suffer greater declines because of its price volatility. Table of Contents10 The market price of our common stock may be higher or lower than the price you may pay for your shares. Certain factors, some of which are beyond our control, that may cause our share price to fluctuate significantly include, but are not limited to, the following: variations in our quarterly operating results; loss of a key relationship or failure to complete significant transactions; additions or departures of key personnel; and fluctuations in stock market price and volume. Additionally, in recent years the stock market in general, and the over-the-counter markets in particular, have experienced extreme price and volume fluctuations. In some cases, these fluctuations are unrelated or disproportionate to the operating performance of the underlying company. These market and industry factors may materially and adversely affect our stock price, regardless of our operating performance. In the past, class action litigation often has been brought against companies following periods of volatility in the market price of those companies' common stock. If we become involved in this type of litigation in the future, it could result in substantial costs and diversion of management attention and resources, which could have a further negative effect on your investment in our stock. WE HAVE NOT PAID, AND DO NOT INTEND TO PAY, CASH DIVIDENDS IN THE FORESEEABLE FUTURE. We have not paid any cash dividends on our common stock and do not intend to pay cash dividends in the foreseeable future. We intend to retain future earnings, if any, for reinvestment in the development and expansion of our business. Dividend payments in the future may also be limited by other loan agreements or covenants contained in other securities which we may issue. Any future determination to pay cash dividends will be at the discretion of our board of directors and depend on our financial condition, results of operations, capital and legal requirements and such other factors as our board of directors deems relevant. SALES OF OUR COMMON STOCK RELYING UPON RULE 144 MAY DEPRESS PRICES IN THE MARKET FOR OUR COMMON STOCK BY A MATERIAL AMOUNT. As of the date of this Prospectus, all of our common stock held by non-affiliates that was issued before December 31, 2012 and was either issued in a registered offer for sale or exchange or has been issued and outstanding beyond applicable holding periods imposed by Rule 144 under the Securities Act of 1933, as amended. Thus, with 100% of our common stock issued prior to December 31, 2011 to non-affiliates being freely tradeable, there is a significant risk that sales under Rule 144 or under any other exemption from the Securities Act, if available, or pursuant to registration of shares of Common Stock of present stockholders, may have a depressive effect upon the price of our common stock in the over-the-counter market, especially in situations where a large volume of shares is offered for sale at the same time. Securities saleable pursuant to the Rule 144 exemption from registration may only be resold, however, if all of the requirements of Rule 144 have been met, including, but not limited to, the requirement that the issuer of the securities have made available all required public information. However, there is no limit on the amount of restricted securities that may be sold by a non-affiliate (i.e., a stockholder who has not been an officer, director or control person for at least 90 consecutive days) after the restricted securities have been held by the owner for a period of at least six months and the other requirements of Rule 144 have been satisfied. Presently shares of restricted Common Stock held by non-affiliates of the Company may be sold, subject to compliance with Rule 144, six months after issuance, provided that our Exchange Act registration remains in effect and we are current in our disclosure reporting obligations. Table of Contents11 THE OFFERING PRICE OF THE SHARES OFFERED BY THE COMPANY WAS NOT DETERMINED BY TRADITIONAL CRITERIA OF VALUE. Presently there is a limited market for our shares of Common Stock on the OTCBB. Trading of our Common Stock does not occur every business day and therefore our Common Stock is relatively illiquid and difficult to price. Accordingly potential purchasers in this Offering should not rely on any quotations published by the OTCBB as the price at which our Shares may be sold. In addition the Company cannot give any assurance that the quoted prices on the OTCBB for the Company's shares have any relation to the actual value of the Company. Accordingly potential investors in this Offering should note that the Offering price of the Shares being offered pursuant to this Prospectus was arbitrarily established by us and was not determined by reference to any traditional criteria of value, such as book value, earnings or assets. PURCHASERS OF THE SHARES WILL INCUR AN IMMEDIATE AND SUBSTANTIAL DILUTION. The purchasers of the Shares being offered hereby will furnish a substantial amount of our capital and will assume substantially all of the financial risk, whereas the present stockholders and the Selling Stockholder will receive a substantial majority of the benefits, if any. In addition, the present Stockholders may have substantial potential profits as a result of this Offering, while purchasers of the newly-issued Shares will experience an immediate and substantial percentage dilution in the net tangible book value of their of their Shares. See: DILUTION. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS Information included in this Prospectus contains forward-looking statements. This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of View Systems, Inc. (the Company ), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words may, will, should, expect, anticipate, estimate, believe, intend, or project or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future. DESCRIPTION OF SECURITIES Our amended and restated articles of incorporation provide that we are authorized to issue two classes of equity securities comprised of 950,000,000 shares of common stock with a par value of $0.001 per share ( Common Stock ) and 10,000,000 shares of preferred stock with a par value of $0.001 per share ( Preferred Stock ). We are also authorized to issue rights, warrants, and options to purchase any class of equity securities. Common Stock This offering pertains only to our Common Stock. Pursuant to the terms of our amended and restated articles of incorporation, our Common Stock may be issued from time to time without any action by the stockholders for such consideration as may be fixed from time to time by the Board of Directors, and shares so issued, the full consideration for which has been paid or delivered, shall be deemed the full paid up stock, and the holder of such shares shall not be liable for any further payment thereof. Shares of Common Stock are not redeemable, do not have any conversion or preemptive rights, and are not subject to further calls or assessments by the Company once fully paid and shall not be subject to assessment to pay the debts of the Company. Holders of Common Stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders and may not cumulate their votes for the election of directors. Table of Contents12 Holders of Common Stock will be entitled to share pro rata in such dividends and other distributions as may be declared from time to time by the Board of Directors out of funds legally available therefore, subject to any prior rights accruing to any holders of preferred stock of the Corporation. Upon liquidation or dissolution of, or any distribution of the assets of, the Corporation, holders of shares of Common Stock will be entitled to share proportionally in all assets available for distribution to such holders. Preferred Stock All of our authorized Preferred Stock is categorized as Series A Preferred Stock. Series A Preferred stock, among other rights set forth in our amended and restated articles of incorporation, has the right to: a liquidation preference of $.01 per share, plus an amount equal to any accrued and unpaid dividends to the payment date, and no more, before any payment or distribution is made to the holders of Common Stock or any series or class of the Company's stock hereafter issued that ranks junior as to liquidation rights to the Series A Convertible Preferred Stock; to convert all or any portion of such holder s shares of Series A Convertible Preferred Stock into fully paid and non-assessable shares of Common Stock in a ratio of 15 shares of Common Stock for each share of Series A Preferred Stock; 15 votes for each share of Series A Convertible Preferred Stock and each share is entitled to vote on any and all matters brought to a vote of shareholders of Common Stock; and prevent the establishment of a class or category of stock superior in distribution rights to Series A Preferred Stock unless a majority of the Series A Preferred Stockholders consent to such action. USE OF PROCEEDS We estimate that, if our Offering is fully subscribed, we will receive net proceeds of $3,969,927.00 from our sale of 100,000,000 Shares. This estimate is based on an Offering price of $0.04 per Share, and assumes that we will not engage the services of an underwriter to assist us in selling all of the Shares. If we engage an underwriter, our net proceeds will be reduced by the negotiated commissions paid to the underwriter. However, as of the effective date of this prospectus, we have not engaged an underwriter. For purposes of this disclosure we have assumed that no commissions will be paid on any Shares. Additionally, we estimate that our direct costs of this Offering (SEC filing fees, legal, accounting, printing, and miscellaneous expenses) will be $30,000. The primary purposes of this Offering are to obtain additional capital to: (1) facilitate product fulfillment (manufacturing, packaging and shipment), which we anticipate will enable future orders to be self funding; (2) provide working capital to finance corporate acquisitions and the integration of new technologies; and (3) retire debt through cash payment or the exchange of debt obligations with payment in registered Common Stock. The table below represents our best estimate of the allocation of the net proceeds, including the priorities for the use of the proceeds, based upon our current business plan and assuming that all of the Shares are sold and not used to retire debt in exchange for Common Stock registered in this offering. Table of Contents13 The amounts set forth merely indicate the general application of net proceeds of the Offering. Actual expenditures relating to the development of our business may differ from the estimates depending on the efficacy of our business development efforts, unanticipated costs in connection therewith as well as changes in the industry and actions of our competitors among other causes. There can be no assurance we will be successful in our efforts to secure investors to invest in our Offering and/or obtain alternative financing. In the event that not all of the Shares are sold, management in its sole discretion will allocate the proceeds of this Offering in a manner in which it determines will be in our best interests. In such an event we may not be able to follow our business plan. This may have a significant impact on our ability to continue operating our business. Moreover even if all of the Shares are sold, management reserves the right to alter the above projected use of proceeds if it determines that such changes will be in our best interests. Accordingly, the amounts and timing of our actual expenditures will depend on numerous factors, including the status of our development and marketing activities and competition. Accordingly, our management will have broad discretion in the use of the net proceeds from this Offering. All net proceeds from this Offering will be immediately available for use by the Company. DETERMINATION OF OFFERING PRICE Since there is only limited trading of our shares of Common Stock which are quoted on the OTCBB, the Offering price of our Shares was unilaterally determined solely by us. The last trade of our shares of our Common Stock, as reported by www.finance.yahoo.com, was on January 20, 2014. The facts we considered in determining the Offering price were: our financial condition and prospects the homeland security market in general; our operating history; the general condition of the securities market; and management s informal prediction of demand for securities such as the Shares. The Offering price is not an indication of and is not based upon our actual value. The Offering price bears no relationship to our book value, assets or earnings or any other recognized criteria of value. The Offering price should not be regarded as an indicator of the future market price of our securities and/or the price at which any investor will be able to resell Shares purchased in this Offering. DILUTION The difference between our estimated offering price of $0.04 per share of common stock and the pro forma net tangible book value per share of common stock after this offering constitutes the dilution to investors in this offering. Our net tangible book value per share is determined by dividing our net tangible book value (total tangible assets less total liabilities) by the number of outstanding shares of common stock. At December 31, 2013 our Common Stock had a pro forma net tangible book value of approximately ($1,248,394) or $(0.006) per share. After giving effect to the receipt of the net proceeds from the maximum offering offered in this prospectus by the Company at an assumed initial offering price of $0.04 per share, our pro forma net tangible book value at December 31, 2013 would be $2,721,606 or $0.009 per share in the maximum offering. This represents an immediate increase in net tangible book value to our present stockholders of $3,970,000 in the maximum offering. The following table illustrates dilution to investors on a per share basis: Table of Contents15 Maximum Estimated offering price per share $ 0.04 Net tangible book value per share before offering $ (0.006 ) Increase per share attributable to investors $ 0.015 Pro forma net tangible book value per share after offering $ 0.009 Dilution per share to investors $ 0.04 SELLING STOCKHOLDERS The following section presents information regarding our Selling Stockholders. The Selling Stockholders table and the notes thereto describe the Selling Stockholders and the number of securities being sold. A description of how the Selling Stockholders acquired the securities being sold in this offering is detailed under in the footnotes to the Selling Stockholders Table. We are registering 6,000,000 shares owned by and on behalf of the Selling Stockholders named in this prospectus. We will pay all costs, expenses and fees related to the registration, including all registration and filing fees, printing expenses, fees and disbursements of our counsel, blue sky fees and expenses. We will not offer any shares on behalf of a Selling Stockholders. The Selling Stockholders are not required to sell their shares, nor have they indicated to us, as of the date of this prospectus, an intention to sell its shares. The Selling Stockholders are offering the common stock for their own account. The material relationship between us and the Selling Stockholders is identified below in the footnotes to the Selling Stockholders Table. The following table provides as of the date of this prospectus, information regarding the beneficial ownership of our common stock held by the Selling Stockholders, including, (i) the number of shares of our common stock beneficially owned by each prior to this offering; (ii) the percentage of such shares of the Company's issued and outstanding shares; (iii) the total number of shares of our common stock that are to be offered by the Selling Stockholders; (iv) the percentage of the issued and outstanding shares being offered;(v) the total number of shares that will be beneficially owned by the Selling Stockholders upon completion of the offering; and (vi) the percentage owned by each upon completion of the offering. To the best of our knowledge, neither of the Selling Stockholders is a broker-dealer or affiliate thereof. The shares below were issued to the Selling Stockholders pursuant to a settlement agreement between us and William Smith (the "Lender") to accept shares in satisfaction of amounts due and owing by us to the Lender in the amount of $111,000. The 3,000,000 shares were issued under the exemption from the registration requirements of Section 4(2) of the Securities Act of 1933, as amended, due to the fact that the issuance did not involve a public offering of securities. The shares below were issued to the Selling Stockholders pursuant to a marketing agreement between us and Jerry Miller dated January 2013 (the "Marketing Agreement") to accept shares as compensation for services rendered. The 3,000,000 shares were issued under the exemption from the registration requirements of Section 4(2) of the Securities Act of 1933, as amended, due to the fact that the issuance did not involve a public offering of securities Table of Contents16 Selling Stockholders Table Selling Stockholder Shares of Common Stock Owned by Selling Stockholder Percentage of Common Stock Owned Before the Offering (1) Shares of Common Stock Included in Prospectus Beneficial Ownership After the Offering (1)(2) Percentage of Common Stock Owned After Offering (1)(2) William Smith (2) 3,000,000 3,000,000 0 0 Jerry Miller (3) 3,000,000 3,000,000 0 0 Totals 6,000,000 6,000,000 0 0 (1) Based upon beneficial ownership information reported to the Company as of October 14, 2013. (2) We entered into that certain Agreement to Accept Common Stock in Payment of Note Payable with William Smith (the "Lender") dated September 21, 2013 (the "Agreement to Accept Stock"). In accordance with the terms and provisions of the Agreement to Accept Stock, we acknowledge an aggregate of $116,000.00 due and owing to the Lender and agreed to issue to the Lender 3,000,000 shares of our common stock. In the event the Lender does not receive $116,000 in net proceeds from the sale of the 3,000,000 shares of common stock, we agreed to issue further shares of our restricted common stock for the difference between $116,000 and net proceeds received. In the event the Lender receives over $116,000 in net proceeds from the sale of the shares of common stock, the Lender shall keep the excess received over $116,000. (3) We entered into that certain Marketing Agreement with Jerry Miller (the "Consultant") dated January 2013. In accordance with the terms and provisions of the Marketing Agreement, we issued to the Consultant 3,000,000 shares of our common stock. PLAN OF DISTRIBUTION This Offering relates to the sale of up to 100,000,000 Shares at the estimated Offering price of $0.04 per share in a best-efforts direct public offering, without any involvement of underwriters. The Shares will be offered and sold by our officers, directors and/or employees. None of these persons will receive a sales commission or any other form of compensation for this Offering. In connection with their efforts, our officers, directors and employees will rely on the safe harbor provisions of Rule 3a4-1 of the Securities Exchange Act of 1934. Generally speaking, Rule 3a4-1 provides an exemption from the broker/dealer registration requirements of the Securities Exchange Act of 1934 for persons associated with an issuer provided that they meet certain requirements. No one has made any commitment to purchase any or all of the Shares being offered. Rather, our directors, officers, and/or employees will use their best efforts to find purchasers for the Shares. We are not required to sell any minimum number of Shares in this Offering. Funds received from investors will not be placed in an escrow, trust or similar account. Instead, all cleared funds will be immediately available to us following their deposit into our bank account, and there will be no refunds once a subscription for Shares are accepted. We cannot predict how many Shares, if any, will be sold. As of March 31, 2014, we have a total of $1,705,486 in debt. As of December 31, 2013 and December 31, 2012, we have a total of $1,465,870 and $1,361,427 respectively, in debt. We would like to retire as much of our debt as possible and will offer to exchange such debt for our Common Stock. We will bear any expenses of this offering, which we estimate to be $30,000. Table of Contents17 We also may retain an underwriter to assist us or to supplant our selling efforts in the Offering. At this time we do not have any binding commitments, agreements, or understandings with any potential underwriter. If we elect to utilize an underwriter, we will amend this Prospectus. We have prepared this prospectus as if we are not using an underwriter to assist us with this Offering. To the extent that we are able to sell the Shares directly through our officers, directors, and employees, the net proceeds received from this Offering will be correspondingly higher than if we engage an underwriter. This Offering will terminate no later than 12 months after the effective date of this prospectus, unless the Offering is fully subscribed before that date or we decide to close the Offering prior to that date. In either event, the Offering may be closed without further notice to you. However, the offering will remain open at least six months from the effective of the registration statement for the benefit of Selling Stockholder. All costs associated with the registration will be borne by us. We have not authorized any person to give any information or to make any representations in connection with this Offering other than those contained in this prospectus and if given or made, that information or representation must not be relied on as having been authorized by us. This prospectus is not an offer to sell or a solicitation of an offer to buy any of the securities to any person in any jurisdiction in which that offer or solicitation is unlawful. Neither the delivery of this prospectus nor any sale hereunder shall under any circumstances, create any implication that the information in this prospectus is correct as of any date later than the date of this prospectus. Purchasers of share either in this Offering or in any subsequent trading market that may develop must be residents of states in which the securities are registered or exempt from registration. Some of the exemptions are self-executing, that is to say that there are no notice or filing requirements, and compliance with the conditions of the exemption renders the exemption applicable. Prior to the date of this prospectus, there has been only an extremely limited trading market for our Common Stock. Our shares of Common Stock are quoted for trading on the OTCBB. The last trade of our Common Stock as reported by www.finance.yahoo.com as of the most recent practicable date was on January 20, 2014 at an average price of $0.04. Since only limited trading in our Common Stock has occurred, investors should not view any reported sales price as an indication of what the fair market value of the Shares are or the price at which Shares may be resold. Until a more active and steady trading market develops for our Common Stock, the price at which shares of our Common Stock trades at may fluctuate significantly. Prices for our Common Stock will be determined in the marketplace and may be influenced by many factors, including the depth and liquidity of the market for our shares, developments affecting our businesses generally, including the impact of the factors referred to in RISK FACTORS above, investor perception of the Company, and general economic and market conditions. No assurances can be given that an orderly or liquid market will ever develop for our shares or that an investor will be able to resell the Shares purchased in this Offering. Shares of Common Stock sold in this Offering will be freely transferable, except for shares of our Common Stock received by persons who may be deemed to be affiliates of the Company under the Securities Act. Persons who may be deemed to be affiliates of the Company generally include individuals or entities that control, are controlled by or are under common control with us, and may include our senior officers and directors, as well as principal stockholders. Persons who are affiliates will be permitted to sell their shares of Common Stock only pursuant to an effective registration statement under the Securities Act or an exemption from the registration requirements of the Securities Act, such as the exemption afforded by Section 4(1) of the Securities Act or Rule 144 adopted under the Securities Act. PENNY STOCK REGULATION Our Common Stock is considered a penny stock as defined by Section 3(a)(51) and Rule 3a51-1(g) under the Securities Exchange Act of 1934 because we do not have: Net tangible assets (i.e., total assets less intangible assets and liabilities) in excess of $2,000,000, and Average revenue of at least $6,000,000 for the last three years. For any transaction involving a penny stock, unless exempt, the penny stock rules require that a broker or dealer approve a person s account for transactions in penny stocks and the broker or dealer receive from the investor a written agreement to the transaction setting forth the identity and quantity of the penny stock to be purchased. Table of Contents18 In order to approve a person s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience and objectives of the person and make a reasonable determination that the transactions in penny stocks are suitable for that person and that person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the SEC relating to the penny stock market, which, in highlight form, sets forth the basis on which the broker or dealer made the suitability determination, and that the broker or dealer received a signed, written agreement from the investor prior to the transaction. Disclosure also has to be made about the risks of investing in penny stock in both public offerings and in secondary trading and commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. The above-referenced requirements may create a lack of liquidity, making trading difficult or impossible, and accordingly, shareholders may find it difficult to dispose of our shares. STATE SECURITIES - BLUE SKY LAWS Transfer of our Common Stock may also be restricted under the securities laws or securities regulations promulgated by various states and foreign jurisdictions, commonly referred to as Blue Sky laws. Absent compliance with such individual state laws, our Common Stock may not be traded in such jurisdictions. Because the securities registered hereunder have not been registered for resale under the blue sky laws of any state, the holders of such shares and persons who desire to purchase them in any trading market that might develop in the future, should be aware that there may be significant state blue-sky law restrictions upon the ability of investors to sell the securities and of purchasers to purchase the securities. Accordingly, investors may not be able to liquidate their investments and should be prepared to hold the Common Stock for an indefinite period of time. We are not currently listed in Standard and Poor's Corporation Records, a nationally recognized securities manual, which would provide us with manual exemptions in 38 states as indicated in 1 Blue Sky L. Rep. (CCH) 2401 (2008), entitled Standard Manuals Exemptions. We intend to obtain a listing in Standard and Poor's Corporation Records and intend to do so as soon as possible. Thirty-eight states have what is commonly referred to as a manual exemption for secondary trading of securities purchased under this registration statement. In these states, so long as we obtain and maintain a Standard and Poor s Corporate Records listing or another acceptable manual, secondary trading of our Common Stock can occur without any filing, review or approval by state regulatory authorities in these states. These states are: Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, South Dakota, Texas, Utah, Vermont, Washington, West Virginia, Wisconsin, and Wyoming. In most instances, under current state rules, secondary trading can occur in these states without further action. However no assurance can be given that such rules will not change in the future or that a specific secondary trading transaction will qualify for a manual exemption. We may not be able to qualify securities for resale in other states which require shares to be qualified before they can be resold by our shareholders. PROCEDURES FOR SUBSCRIBING TO SHARES OFFERED BY THE COMPANY If you decide to subscribe for any shares in this Offering, you are required to execute a Subscription Agreement and tender it, together with a check or certified funds to us. All checks for subscriptions should be made payable to View Systems, Inc. Table of Contents19 SHARES OFFERED BY THE SELLING STOCKHOLDERS 6,000,000 shares of Common Stock are included in this prospectus as being offered by the Selling Stockholders. The offering will be kept open for at least six months to allow the Selling Stockholders to sell their shares pursuant to this registration statement and prospectus. The Company will pay the expenses of the registration of the Selling Stockholder s shares. The Selling Stockholders, which as used herein includes donees, pledgees, transferees or other successors-in-interest selling shares of common stock received after the date of this prospectus from the Selling Stockholders as a gift, pledge, partnership distribution or other transfer, may offer the shares covered by this prospectus to the public or otherwise from time to time. The registration of these shares does not necessarily mean that any of them will be offered or sold by the Selling Stockholders. The Selling Stockholders have informed us that any or all of the common shares covered by this prospectus may be sold to purchasers directly by the Selling Stockholders or on their behalf through brokers, dealers or agents in private or market transactions, which may involve crosses or block transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. The Selling Stockholders may use any one or more of the following methods when disposing of shares or interests therein: ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; block trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction; purchases by a broker-dealer as principal and resale by the broker-dealer for its account; an exchange distribution in accordance with the rules of the applicable exchange; privately negotiated transactions; short sales effected after the date the registration statement of which this prospectus is a part is declared effective by the SEC; through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; broker-dealers may agree with the Selling Stockholders to sell a specified number of such shares at a stipulated price per share; a combination of any such methods of sale; and any other method permitted pursuant to applicable law. The Selling Stockholders may, from time to time, pledge or grant a security interest in some or all of the shares of common stock owned by it and, if it defaults in the performance of its secured obligations, the pledgees or secured parties may offer and sell the shares of common stock, from time to time, under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending the list of Selling Stockholders to include the pledgee, transferee or other successors in interest as Selling Stockholders under this prospectus. Table of Contents20 The Selling Stockholders also may transfer the shares of common stock in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus. In connection with the sale of our common stock or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The Selling Stockholders may also sell shares of our common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The Selling Stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction). The aggregate proceeds to the Selling Stockholders from the sale of the common stock offered by them will be the purchase price of the common stock less discounts or commissions, if any. The Selling Stockholders may receive underwriter compensation. The Selling Stockholders in this prospectus will be able to sell at the market price and may profit by the difference between its cost and the market price so long as the market price per share exceeds the Selling Stockholders' costs per share. The Selling Stockholders reserve the right to accept and, together with their agents from time to time, to reject, in whole or in part, any proposed purchase of common stock to be made directly or through agents. We will not receive any of the proceeds from the offering made by the Selling Stockholders. The Selling Stockholders also may resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under the Securities Act provided that they each meet the criteria and conform to the requirements of that rule. The Selling Stockholders and any underwriters, broker-dealers or agents that participate in the sale of the common stock or interests therein may be "underwriters" within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions or profit they earn on any resale of the shares may be underwriting discounts and commissions under the Securities Act. Selling stockholders who are "underwriters" within the meaning of Section 2(11) of the Securities Act will be subject to the prospectus delivery requirements of the Securities Act. To the extent required, the shares of our common stock to be sold, the name of the Selling Stockholders, the respective purchase prices and public offering prices, the names of any agent, dealer or underwriter, and any applicable commissions or discounts with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement that includes this prospectus. In order to comply with the securities laws of some states, if applicable, the common stock may be sold in these jurisdictions only through registered or licensed brokers or dealers. In addition, in some states the common stock may not be sold unless it has been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied with. We have advised the Selling Stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the Selling Stockholders and their affiliates and that there are restrictions on market-making activities by persons engaged in the distribution of the common shares. We have also advised the Selling Stockholders that if a particular offer of common shares is to be made on terms constituting a material change from the information described in this Plan of Distribution section of the Prospectus, then, to the extent required, a prospectus supplement must be distributed setting forth such terms and related information as required. Table of Contents21 In addition, we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the Selling Stockholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act, if applicable. The Selling Stockholders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act. We have agreed with the Selling Stockholders to keep the registration statement of which this prospectus constitutes a part effective until the earlier of (1) such time as all of the shares covered by this prospectus have been disposed of pursuant to and in accordance with the registration statement or (2) the date on which the shares may be sold pursuant to Rule 144(d) promulgated under the Securities Act. INTERESTS OF NAMED EXPERTS AND COUNSEL The consolidated financial statements of View Systems, Inc. as of December 31, 2012 and 2011, included herein and elsewhere in this prospectus, have been audited by Stegman& Company, an independent registered public accounting firm, for the periods and the extent set forth in its report appearing herein and elsewhere in the prospectus. The consolidated financial statements have been included in reliance upon the report of such firm given upon its authority as an expert in auditing and accounting. Diane D. Dalmy (the Firm ), has acted as our counsel in connection with this offering, including with respect to opining on the validity of the issuance of the securities offered in this prospectus. Also, if an underwriter is engaged by the Company in connection with this offering, certain legal matters in connection with this offering will be passed upon for the underwriters by the Firm. The Firm will be compensated for its fees incurred in the preparation of this prospectus and the related registration statement filed with the SEC. Such compensation is expected to be paid from a portion of the sale proceeds realized by the Company from its offering of Shares herein. DESCRIPTION OF BUSINESS CORPORATE HISTORY View Systems was incorporated in Florida on January 25, 1989, as Beneficial Investment Group, Inc. and became active in September 1998 when we began development of our digital video product line and changed the company's name to View Systems, Inc. Starting in 1999 we expanded our business operations through a series of acquisitions of technologies we use in our digital video recorder technology products and in our concealed weapons technology. On July 25, 2003, View Systems incorporated View Systems, Inc. as a wholly-owned Nevada corporation for the sole purpose of changing the domicile of the company from Florida to Nevada. On July 31, 2003, articles of merger were filed with the states of Florida and Nevada to complete the domicile change. OUR BUSINESS View Systems, Inc. develops, produces and markets computer software and hardware systems for security and surveillance applications. In 1998 digital video recorder technology was our first developed product and we enhanced this product line by developing interfaces with other various technologies, such as facial recognition, access control cards and control devices such as magnetic locks, alarms and other common security devices. In 2003 we sold this product to various commercial entities including schools, restaurants, night clubs, car washers and car dealers (license plate recognition was incorporated into these types of installations), ranches and gas stations. In these installations we integrated the digital video recorded technology with other electronic devices, and we gained knowledge of the security needs of a wide range of businesses. Table of Contents22 We expanded our product line in 2002 to include a concealed weapons detection system we call ViewScan. We have penetrated four major market segments for this product: correctional facilities, judicial facilities, probation offices and federal facilities in the Mid-Atlantic States, the West Coast and the South. In 2003 we added a hazardous material first response wireless video transmitting system to our product line we refer to as Visual First Responder. The markets for these units are first responder units for agencies such as the National Guard, Coast Guard, Army, state law enforcement agencies, and fire departments. Both of these technologies were licensed from the U.S. Department of Energy's Idaho National Engineering Laboratory ("INEL"). Until 2005 we assembled all of our products in-house, but we currently contract with third party manufacturers to manufacture some components of our products. Historically, we have relied upon exclusive technology licensing agreements with federal departments to license and distribute the ViewScan technology. In anticipation of the expiration of federal licenses, we developed propriety components and made sufficient engineering design changes to the ViewScan product to lower production costs and to accommodate the price points required by competitive pressures. By redesigning the ViewScan, we offset the impact of the expiration of our license agreements and continued to capitalize on the competitive advantage we had in the markets we had entered. We have a similar strategy for the Visual First Responder, which is now in its third generation. Asset Purchase Agreement On June 1, 2012, we entered into an asset purchase agreement (the "Asset Purchase Agreement"), with Essential Security Group of Toledo Ohio ("ESG"). In accordance with the terms and provisions of the Asset Purchase Agreement, we agreed to purchase all assets and liabilities of ESG for payment of 2,000,000 shares of our restricted common stock to ESG's two principal shareholders. One million shares were required to be issued at closing (500,000 shares each to John P. Rademaker and David Loyer), and the remaining 1,000,000 shares (500,000 shares each to Messrs. Rademaker and Loyer) were required to be issued upon ESG's attainment of certain performance goals. ESG is an installer of our ViewScan units. On June 28, 2012, we executed an amendment to the Asset Purchase Agreement with ESG (the "Amendment to Asset Purchase Agreement"). In accordance with the terms and provisions of the Amendment to Asset Purchase Agreement, a floating closing date was imposed subject to completion of ESG's delivery of required pre-closing items and our completion of our due diligence inquiries. The Amendment to Asset Purchase Agreement further required ESG to obtain an audit of its financial statements and an audit opinion satisfactory to us. In or about September 2012, during our due diligence inquiry, we determined not to go forward with the transaction as proposed. The 2,000,000 shares of common stock required to be issued by us were not issued. PRODUCTS AND SERVICES Our current principal products and services include: ViewScan Concealed Weapons Detection System ViewScan, which is also sold under the name Secure Scan , is a walk-through concealed weapons detector which uses data sensing technology to accurately pinpoint the location, size and number of concealed weapons. This walk-through portal is controlled by a master processing board and a personal computer based unit which receives magnetic and video information and combines it in a manner that allows the suspected location of the weapon to be stored electronically and referenced. Because ViewScan does not produce a graphic anatomical display of a scanned person, the Company does not believe that ViewScan is susceptible to privacy concerns raised about certain personnel scanners produced by other companies. ViewScan products are distributed in three basic configurations; stand-alone units, portable units and integrated door systems. Table of Contents23 While electromagnetic induction systems of the type described above have been used for decades as concealed weapons detection systems, they are not without their problems. For example, such electromagnetic induction systems are generally sensitive to the overall size, i.e., surface area of the object, including its mass. Consequently, small, compact, but massive objects, such as a small pistol, may not produce a "signature" that is significantly larger than the signature produced by a light weight object of the same or greater size, such as a cell phone or compact camera. Another problem associated with electromagnetic induction systems is related to the fact that electromagnetic systems are sensitive to electrically conductive objects, regardless of whether they are magnetic or non-magnetic. That is, electromagnetic systems tend to detect non-magnetic objects, such as pocket change, just as easily as magnetic objects, such as weapons. Consequently, electromagnetic systems tend to be prone to false alarms. In many circumstances, such false alarms need to be resolved by scanning the suspect with a hand-held detector in order to confirm or deny the presence of a dangerous weapon. ViewScan is designed to overcome the traditional shortcomings of electromagnetic induction scanners. The ViewScan portal uses an array of advanced magnetic sensors, each with internal digital signal processors. The sensors communicate with the control unit's software which spatially places identified magnetic anomalies and visually places the location of the potential threat object with a red dot that is superimposed over a real time snapshot image of the person walking through the portal. Along with the snapshot, a graph displays the sensor data which automatically scales the signal strength of the individual sensors and cross-references them to the video image. All of this information is brought together on a video screen that displays the image of the person, the location of the weapon(s) and the size of the weapon(s), depending on the intensity of the magnetic signature. The visual image allows the operator to determine what the object is without the need to conduct a personal search to locate the object and look at it. The ViewScan system operates faster than ordinary metal detectors and can scan as high as 1,200 persons per hour. Since the ViewScan technology does not use transmitters to produce electromagnetic induction, it does not pose a problem for pacemakers. The ViewScan self calibrates and does not need operator intervention or special calibration tools. In 2004 we introduced the ViewScan product to the venue and stadium market. In February 2005 we tested the ViewScan at the pre-game venues of the Super Bowl football game in Jacksonville, Florida. During that installation, the portal scanned up to 3,000 to 4,000 people and at various times throughput ranged from approximately 600 to 1,200 persons per hour. During 2005 we contracted with the University of Northern Florida to design new sensor boards for the ViewScan product which has allowed us to reduce the installed sensor cost by a factor of four. The new lower costs allow us to offer price points to the market which compete directly with traditional metal detectors. In February 2006 we demonstrated a ViewScan product with a precision optical biometric fingerprint terminal. As expected, the demand for biometric interfaces has increased significantly. In addition to verifying that an individual is not carrying guns, knives and sometimes cameras, the units can perform multi-modal double and triple identity checks, including: fingerprint, facial, iris, driver s license and employee identification card verification. Today we sell these units for an average retail price of approximately $9,000 with a one year extended warranty. We feel the new reduced price points and enhanced interface abilities will allow us to be more competitive, along with the advantages of three to four times the throughput rate, non-contact imaging and permanent visual storage, and a log of all individuals scanned. We have been making additional cost reductions through economies of scale and larger scale integration by taking advantage of ongoing computer component improvements. Table of Contents24 3D Facial Recognition Technology - Animetrics Inc. On August 9, 2012, we entered into a partnership with Animetrics Inc. ("Animetrics"), a leading developer of advanced 3D facial recognition and identify management solutions (the "Animetrics Agreement"). In accordance with the terms and provisions of the Animetrics Agreement, we will integrate Animetrics' next-generation 3D facial recognition technology into its concealed weapons detection systems used for security screening at correctional facilities, stadiums, courthouses, schools and other public facilities. Our ViewScan Concealed Weapons Detector is a walk-through portal which uses advanced magnetics technology to accurately pinpoint threat objects on a visual image of the subject. The system is sensitive enough to locate items such as hidden razor blades and cellular phones but will ignore common objects such as coins, keys and belt buckles. The initial objective is to integrate Animetrics' facial identify management software, the FaceR identity management solution (FIMS) onto our ViewScan, incorporating next generation facial recognition and investigative face biometric capabilities into the weapons detection and identification system. We also plan to utilize Animetrics' cloud-based FaceR FIMS and its suite of FaceR facial biometric identify and screening applications, including FaceR Mobile ID, FaceR Credential Me and ForensicaGPS across its entire portfolio of security and surveillance systems and applications. The FIMS is deployed either via Web server or in a clod-based architecture system. Both configurations provide centralized and scalable management of highly distributed :one-to-many" identity searched in the field. FIMS utilized Animetrics' FACEngine biometric facial recognition technology that converts 2D images to accurate 3D geometrics for enhanced biometric templates. FIMS makes these 3D facial "signatures" for identification purposes available to credentialized users via any mobile or fixed digital device with internet connectivity. This powerful combination with the ViewScan delivers most advanced facial-recognition and comparison technology to personnel in the field providing accurate and fast results. National Security Resources On February 9, 2012, we entered into a partnership (the "Partnership") with National Security Resources, Inc., a facial recognition company ("National Security Resources"). In accordance with the Partnership, we will work together with National Security Resources to develop and deliver an integrated solution for a combined technology line. We intend to integrate National Security Resources' advanced "scan and match facial recognition" ability into our concealed weapons detection ViewScan. Multi-Mission Mobil Video The Multi-Mission Mobil Video (MMV) is a lightweight, wireless camera system housed in a tough, waterproof body. The camera system sends back real-time images to a computer or video monitor at the command post located outside the exclusion zone or containment area. The MMV is able to transmit high quality video in the most difficult environments. The image is received from the MMV and displayed on a monitor and can be easily recorded using a common camcorder or VCR with video input. The camera can be completely submerged for fast and easy decontamination. The MMV also uses an Extension Link which is a separate transmitter and receiving system that increases the operating range of the MMV. The Extension Link has field-selectable channels to avoid interference at longer distances. We have also incorporated a video encryption feature that allows first responders to transmit on-scene video to the command post without the data being intercepted by unwanted parties. The complete MMV is fully deployed by one person in a stand-alone configuration in less than 10 minutes. The system is battery operated and can operate for eight continuous hours using one set of spare camera batteries. We sell this base product for approximately $9,000 retail, but the cost can be as high as $18,500 depending on additional special features such as the extension link and encryption capabilities. This product allows hands-free operation of the unit because it allows the person to wear the unit with a helmet mounted monocle. Table of Contents25 ViewMaxx Digital Video System ViewMaxx is a high-resolution, digital video recording and real-time monitoring system. This system can be scaled to meet a specific customer's needs by using anywhere from one camera up to 32 surveillance cameras per each ViewMaxx unit. The system uses a video capture card recording which translates closed-circuit television analog video data (a format normally used by broadcasters for national television programs) to a computer readable digital format to be stored on direct access digital disk devices rather than the conventional television format of video tape. ViewMaxx offers programmable recording features that can eliminate the unnecessary storage of non-critical image data. This ability allows the user to utilize the digital disk storage more efficiently. The ViewMaxx system can be programmed to satisfy each customer's special requirements, be it coverage which is continuous, or only when events are detected. For example, it can be programmed to begin recording when motion is detected in a surveillance area, or a smaller field of interest within the surveillance area, and can be programmed to notify the user with an alarm or message. Viewing of the stored digital images can be performed locally on the computer's video display unit or remotely through the customer's existing telecom systems or data network. It also uses a multi-mode search tool to quickly play back files with simple point and click operations. The search mode parameters can be set according to a specific monitoring need, such as: certain times of day, selected areas of interest in the field of view or breaches of limit areas. These features and abilities avoid the need to review an entire, or many, VCR tapes for a critical event. Our ViewMaxx products include the following features: Use any and all forms of telecommunications, such as standard telephone lines; Video can be monitored 24 hours a day by a security monitoring center; Local and remote recording, storage and playback for up to 28 days, with optional additional storage capability; The system may be set to automatically review an area in a desired camera sequence; Stores the video image according to time or a criteria specified by the customer and retrieves the visual data selectively in a manner that the customer considers valuable or desirable; The system may trigger programmed responses to events detected in a surveillance area, such as break-ins or other unauthorized breaches of the secured area; Cameras can be concealed in ordinary home devices such as smoke detectors; The system monitors itself to insure system functionality with alert messages in the event of covert or natural interruption; and Modular expansion system configuration allows the user to purchase add-on components at a later date. Depending on the features of a particular system the retail price including installation can range from approximately $5,000 up to $50,000. Table of Contents26 Additional Applications and Integration of ViewScan and ViewMaxx We also offer integration of other products with ViewScan or ViewMaxx. Biometric verification is a system for recognizing faces and comparing them to known individuals, such as employees or individuals wanted by law enforcement agencies. This product can be interfaced with ViewScan and/or ViewMaxx to limit individual access to an area. ViewScan and/or ViewMaxx can be coupled with magnetic door locks to restrict access to a particular area. We also offer a central monitoring or video command center for ViewScan or ViewMaxx products. The MINI The MINI (Mobile Intelligent Network Informer) is a portable, wireless watchdog communication device that checks for intrusion into uninhabited areas such as foreclosed houses, storage spaces and vacation homes. The MINI senses motion and sends text messages to a user's cell phone. Property and remote assets may be guarded by this innovative device that requires no plug-in electricity, no physical phone line and no monitoring service. The MINI runs on batteries and one configuration of the system can even send a photo of the intruder to the user's cell phone. Camera settings can be controlled and changed via SMS commands. We license the MINI from its manufacturer and act as a distributor. The Company established a dedicated e-commerce platform for the direct sale of this innovative product, which went online in February 2010. We are marketing the MINI to large potential users, such as real property managers, as well as retail customers through the www.minicamsim.com website. We have had non-material amounts of revenue from MINI sales thus far, which we attribute to a lack of advertising funds and market awareness. Network Services View Systems Inc. Network Services group supplied integrated electronic security and control systems for commercial and industrial applications throughout the Mid Atlantic area. In approximately March 2011, we elected to discontinue our Network Services group. We did not secure any jobs during the summer high season because the minimum amount of work we needed to be profitable was not available to us. We did not earn any revenue from this division, but we continued to have overhead deriving from lease obligation on two motor vehicles that supported this division. In August 2011 we sold one vehicle at a gain of $338 and continue to make payments on a second vehicle. Between March 2009 when we entered the fiber optic cable installation business and our exit in March, 2011, our revenues attributed to this division were approximately $200,000 while our accumulated costs which are ongoing were $0 at the end of the reporting period. FiberXpress, Inc. On July 24, 2009 we entered into an asset purchase agreement to acquire FiberXpress, Inc., a company that sells specialist data network related products through its Internet web site. The transaction closed on September 15, 2009 with an exchange of stock and the hiring of William Paul Price. The acquisition has not been material to our financial statements. The FiberXpress acquisition has not resulted in meaningful sales, and we are looking for suitable options. Visisys Ltd. Our partnership with Visisys, Ltd. has been terminated. There were no sales in either 2011 or 2010 from this partnership, but the termination of the partnership did not impact our balance sheet materially. We believe that Visisys, Ltd. has gone out of business. Table of Contents27 TRAINING AND SERVICE PROGRAMS We offer support services for our products which include: On site consulting/planning with customer architect and engineers, Installation and technical support, Training and "Train the Trainer" programs, and Extended service agreements. OUR MARKET Our family of products offers government and law enforcement agencies, commercial security professionals, private businesses and residential consumers an enhanced surveillance and detection capacity. Management has chosen to avoid the air passenger traffic and civilian airport market for metal detection because we believe that a larger market exists in venues such as sporting events, concerts, race tracks, schools, courthouses, municipal buildings, and law enforcement agencies. Our ViewScan products and technology can be used where there is a temporary requirement for real-time weapons detection devices in areas where a permanent installation is cost prohibitive or impractical. For example, our ViewScan portal could be set up for special events, concerts, and conventions. Our systems may reduce the need for a large guard force and can provide improved pedestrian traffic flow into an event because individuals can be scanned quickly and false alarms are reduced. A primary market for our ViewScan portal is federal and state government courthouses, county and municipal buildings, and correctional facilities. We have installed our ViewScan weapons detection products in a variety of court house situations. The MMV product's market includes National Guard units and first response agencies such as fire, police, SWAT, and homeland security response teams. The MINI is an easy to use, simple and convenient personal security monitoring device that can be purchased by individuals through an independent website, potentially through retail electronics stores, or through commercial installers of self-contained or centrally monitored security systems. However, at this time we do not have retail agreements in place. Using our technology, individuals could run their own perimeter and interior surveillance systems from their own home computer. Real-time action at home can be monitored remotely through a modem and the Internet. There is also the capability to make real-time monitors wireless. An additional advantage of our technology is that it allows for the storage of information on the home computer and does not require a VCR. This capability may reduce the expense and time of the home installation and may make installation affordable for a majority of homeowners. We are marketing the MINI to large potential users, such as real property managers, as well as retail customers through the www.minicamsim.com website. We have had non-material amounts of revenue from MINI sales thus far, which we attribute to a lack of advertising funds and market awareness. In March, 2011, we exited the fiber optic installation network and terminated our Network Services Division. MANUFACTURING We manufacture the ViewScan portal and the ViewMaxx internally at our facilities in Baltimore, Maryland. Our third party manufacturers create several of the hardware components in our systems and we assemble our systems by combining other commercially available hardware and software together with our proprietary software. We hold licenses for software components that are integrated into our proprietary software and installed in our systems. We believe that we can continue to obtain components for our systems at reasonable prices from a variety of sources. Although we have developed certain proprietary hardware components for use in our products and purchased some components from single source suppliers, we believe similar components can be obtained from alternative suppliers without significant delay. Table of Contents28 SALES AND DISTRIBUTION We are constantly seeking to extend our United States domestic network of manufacturing representatives and dealers for the sale and distribution of our products. We are looking for security consultants, specifiers and distributors of security and surveillance equipment that sell directly to schools, courthouses, and government and commercial buildings. We use mailings and telephone calls to contact potential representatives in a geographical area with the intent to arrange a demonstration of our products to these persons. We attend region specific trade shows such as sheriff's conventions, court administrators meetings, civil support team, and state police shows. Then we demonstrate or give trial offers in the area until a sale is completed. Once we have completed a sale in a specific market area, then we expand that market by contacting correctional facilities, courthouses and other municipal buildings. We ship our products to the customer and each product has an unconditional 30 day warranty, during which time the product can be returned for a complete refund. We have ongoing reseller arrangements with small and medium-sized domestic and international resellers. Our reseller agreements grant a non-exclusive right to the reseller to purchase our products at a discount from the list price and then sell them to others. These agreements are generally for a term of one year and automatically renew for successive one-year terms unless terminated by notice or in the event of breach. In 2010 we also have experienced international interest from security related resellers and system integrators. Previously, we had chosen not to pursue international markets, but we secured sales in Bangladesh. Marketing of the MINI can be viral through use of Internet search engine optimization. During 2011 we did not have the financial resources to market the MINI. MAJOR CUSTOMERS On October 9, 2012, we were selected for installation of its enhanced and new ViewScan VS-1000 weapons detection and access control product for installation in seventeen Detroit Public Schools. The ViewScan VS-1000 was introduced at the annual ASIS Security Conference and Exposition in Philadelphia in 2011 and has been chosen by multiple companies to be used for access control. The first installations were made in the Detroit Public Schools in September 2011. To date, we have installed out ViewScan systems in the Bayview Electric ESS School, Wiltec Electronic Security Group, Fox Command Center, Detroit Police Department, Harper Woods School, Blueline and have rented equipment to Pinkerton and Harper Woods School. The improved WiewScan VS-1000 system senses the smallest reading without being affected by environmental disturbances and structural elements such as reinforced concrete and metal door frames. Unlike ordinary metal detectors, the ViewScan VS-1000 system can be placed directly next to each other and still function correctly. The ViewScan VS-1000 system was also used at the National Democratic Convention. During 2011, we had 21 ViewScan systems ordered by correctional facilities and 60 units ordered by domestic schools and police departments. We also received purchase orders for a total of 12 ViewScan units from a customer in Bangladesh. COMPETITION The markets for our products are extremely competitive. Competitors include a broad range of companies that develop and market products for the identification and video surveillance markets. In the weapons detection market, we compete with Ranger Security Scanners, Inc. and Garrett Electronics, Inc. in the United States, and an Italian company, CEIA SpA, which has the most sophisticated electromagnetic induction product. In the video surveillance market we compete with numerous VCR suppliers and digital recording suppliers, including, Sensormatic Corporation, NICE Systems, Ltd., and Integral Systems. Table of Contents29 TRADEMARK, LICENSES AND INTELLECTUAL PROPERTY Certain features of our products and documentation are proprietary, and we rely on a combination of patent, contract, copyright, trademark and trade secret laws and other measures to protect our proprietary information. We limit access to, and distribution of, our software, documentation and other proprietary information. As part of our confidentiality procedures, we generally enter into confidentiality and invention assignment agreements with our employees and mutual non-disclosure agreements with our manufacturing representatives, dealers and systems integrators. Notwithstanding such actions, a court considering these provisions may determine not to enforce such provisions or only partially enforce such provisions. The ViewScan concealed weapons detection technology involves sensing technology and data acquisition/analysis software subsystems that have patents pending or issued to the U.S. Department of Energy. We have not renewed our license, with the INEL to commercialize, manufacture and market the concealed weapons detection technology. View Systems has not filed for patents and has found that the expense and difficulty of patenting this product would be financially prohibitive. Governmental ownership of the patents is advantageous to us; however, the costs have outweighed the benefits. We have not received improvements, the promised funding or support from our government licensors. We have, however, paid money and spent time to advance the technologies. We have obtained software licensing agreements for software operating systems components, fingerprint identification capabilities to possibly integrate into our proprietary software, and commercially available operating systems software to integrate into our proprietary product software. Because the software and firmware (software imbedded in hardware) are in a state of continuous development, we have not filed applications to register the copyrights for these items. However, under law, copyright vests upon creation of our software and firmware. Registration is not a prerequisite for the acquisition of copyright rights. We take steps to insure that notices are placed on these items to indicate that they are copyright protected. The copyright protection for our software extends for the 20-year statutory period from the date of first "publication," distribution of copies to the general public, or from the date of creation, whichever occurs first. We provide software to end-users under non-exclusive "shrink-wrap" licenses, which are automatic licenses executed once the package is opened. This type of license has a perpetual term and is generally nontransferable. Although we do not generally make source code available to end-users, we may, from time to time, enter into source code escrow agreements with certain customers. We have also obtained licenses for certain software from third parties for incorporation into our products. RESEARCH AND DEVELOPMENT We outsource improvements or changes when requested by customers and warranted financially. For the years ended December 31, 2013 and December 31, 2012, we have spent approximately $21,977 and $10,000, respectively, on research and development. REGULATORY ENVIRONMENT We are not subject to government approval or regulation in the manufacture of our products or the components in our products. However, our products are subject to certain government restrictions on sales to "unfriendly" countries and countries designated as adversarial, which may limit our sales to the international market. In addition, our resellers and end users may be subject to numerous regulations that stem from surveillance activities. We also benefit from the recent "made in America" trade laws where non-United States manufactures must secure waivers in order to sell security and surveillance products to United States domestic end-users. Security and surveillance systems, including cameras, raise privacy issues and our products involve both video and audio, and added features for facial identification. The regulations regarding the recording and storage of this data are uncertain and evolving. For example, under the Federal wiretapping statute, the audio portion of our surveillance systems may not record a person's conversation without his or her consent. Further, there are state and federal laws associated with recording video in non-public places. Table of Contents30 Cost and effect of compliance with environmental laws The Company has not determined any recognizable cost related to compliance with environmental laws. EMPLOYEES As of the date of this Prospectus, we employ approximately five persons, including one sales executive and three office personnel, which includes one customer service engineer. Two persons are part-time and we also contract with five independent contractors who devote a majority of their work to a variety of our projects. Our employees are not presently covered by any collective bargaining agreement. Our relations with our employees are good, and we have not experienced any work stoppages by our employees. DESCRIPTION OF PROPERTY We lease 3,600 sq. ft. of office and warehouse space at 1550 Caton Center Drive, Suites D and E, Baltimore, Maryland, under a three-year non-cancellable operating lease, which expires December 2014. This location serves as both our principal executive office and the manufacturing and assembly location for our proprietary products. The original base rent had been $3,077 per month with an annual rent escalator of 3%. The current monthly rent is $3,464. Rent expense, which includes the Caton Center property as well as some other short-term leases, was $44,652 and $45,941 for the period ended December 31, 2013 and 2012, respectively. LEGAL PROCEEDINGS As of the date of this Prospectus, management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Prospectus, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties. PRICE OF AND DIVIDENDS ON THE REGISTRANT S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. MARKET INFORMATION Our common stock has been quoted on the OTC Bulletin Board under the symbol "VYST.OB" up to October 2008 and from October 17, 2008 under the symbol VSYM.OB and is traded over the counter. The following table sets forth the high and low price information of the Company's common stock for the periods indicated. OTC Bulletin Board (1) (2) FISCAL YEAR ENDED DECEMBER 31, 2012: High Low Fourth Quarter $ 0.04 $ 0.00 Third Quarter $ 0.043 $ 0.00 Second Quarter $ 0.043 $ 0.00 First Quarter $ 0.03 $ 0.00 FISCAL YEAR ENDED DECEMBER 31, 2013: Fourth Quarter $ 0.301 ` 0.0001 Third Quarter $ 0.035 $ 0.0378 Second Quarter $ 0.04 $ 0.037 First Quarter $ 0.025 $ 0.019 (1) Over-the-counter market quotations reflect inter-dealer prices without retail mark-up, mark-down or commission, and may not represent actual transactions. (2) Source: www.nasdaq.com Table of Contents31 SHAREHOLDERS OF RECORD As of April 28, 2014, there were approximately 402 holders of record of our common stock, not including holders who hold their shares in street name. DIVIDENDS We have never declared or paid a cash dividend. At this time, we do not anticipate paying dividends in the future. We are under no legal or contractual obligation to declare or to pay dividends, and the timing and amount of any future cash dividends and distributions is at the discretion of our Board of Directors and will depend, among other things, on our future after-tax earnings, operations, capital requirements, borrowing capacity, financial condition and general business conditions. We plan to retain any earnings for use in the operation of our business and to fund future growth. You should not purchase our Shares on the expectation of future dividends. SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS Equity Compensation Plan Information Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted- average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) Equity compensation plans approved by security holders 50,000,000 (1) 36,340,900 (2) Equity compensation plans not approved by security holders ________- _______- Total 50,000,000 36,340,900 (1) Represents shares reserved for the Company s 2010 Equity Incentive Plan. (2) Represents shares reserved for the Company s 2010 Service Provider Stock Compensation Plan. 2010 EQUITY INCENTIVE PLAN The 2010 Equity Incentive Plan ( EIP ) is intended to attract, motivate, and retain employees of the Company, consultants who provide significant services to the Company, and members of the Board of Directors of the Company who are not employees of the Company. The EIP is designed to further the growth and financial success of the Company by aligning the interests of the participants, through the ownership of stock and through other incentives, with the interests of the Company s stockholders. Benefits under the 2010 EIP. As defined under the 2010 EIP, the Board may grant any one or a combination of Incentive Stock Options (within meaning of the Code), Non-Qualified Stock Options, Restricted Stock, as well as Performance Awards (collectively, Awards ). Table of Contents32 Administration of the 2010 Equity Incentive Plan. The EIP will be administered by the Board of Directors. If it chooses, the Board may delegate its authority to a Compensation Committee to be appointed by the Board (the Committee ), which Committee may be comprised of two or more outside directors as described in Section 162(m) of the Internal Revenue Code of 1986, as amended (the Code ). Subject to certain limitations in the 2010 EIP, the Board establishes the terms and conditions of awards granted under the 2010 EIP, interprets the 2010 EIP and all awards under the 2010 EIP, and administers the 2010 EIP. Eligible Participants under the 2010 EIP. Except for Incentive Stock Options which may only be granted to Employees of the Company, Awards under the 2010 EIP may be granted to Employees, Directors, and Consultants of the Company (as such terms are defined in the 2010 EIP) who are designated by the Board. No employee may receive Awards under this 2010 EIP in any given year which, singly or in the aggregate, cover more than 150,000 shares of the Company s Common Stock. Shares Available under the 2010 EIP. The aggregate number of shares of Common Stock that may be issued or transferred to grantees under the 2010 EIP shall not exceed 50,000,000 shares. If there is a stock split, stock dividend or other relevant change affecting the Company s shares, appropriate adjustments will be made in the number of shares that may be issued or transferred in the future and in the number of shares and price of all outstanding Awards made before such event. If shares under an Award are not issued or transferred, those shares would again be available for inclusion in future Award grants. Awards Under the 2010 EIP Stock Options. The Board may grant options qualifying as incentive stock options under the Code and nonqualified stock options. The term of an option shall be fixed by the Board, but shall not exceed ten years. In the case of death of the holder of the option or upon the termination, removal or resignation of the option holder for any reason other than for cause within one year of the occurrence of a Change of Control (as that term is defined in the 2010 EIP), an option may be extended for up to 12 months depending on the circumstances. The option price shall not be less than the fair market value of the Common Stock on the date of grant. In the case of an award of Incentive Options to an employee possessing more than 10% of the total combined voting power of all classes of stock of the Company or any parent corporation or subsidiary corporation as those terms are defined in the Code, the option price shall not be less than 110% of the fair market value of the Common Stock on the date of grant and the option term shall not exceed five years from date of grant. Payment of the option price may be by cash or, with the consent of the Board, by tender of shares of Common Stock having an equivalent fair market value or delivery of shares of Common Stock for which the option is being exercised to a broker for sale on behalf of the option holder. With respect to Incentive Options, the aggregate fair market value of shares of Common Stock for which one or more options granted may for the first time become exercisable during any calendar year shall not exceed $100,000. Restricted Stock. The Board may also award shares of Restricted Stock. The shares will be issued as restricted stock within the meaning of Rule 144 of the Securities Act of 1933, as amended. Such grant would set forth the terms and conditions of the award, including the imposition of a vesting schedule during which the grantee must remain in the employ of the Company in order to retain the shares under grant. If the grantee s employment terminates during the period, the grant would terminate and the grantee would be required to return any unvested shares to the Company. However, the Board may provide complete or partial exceptions to this requirement as it deems equitable. Unless an Award specifically provides otherwise, any shares not otherwise vested shall vest upon the death, disability, termination, removal or resignation of the grantee for any reason other than for cause within one year of the occurrence of a Change of Control (as that term is defined in the 2010 EIP). The grantee cannot dispose of the shares prior to the expiration of forfeiture restrictions set forth in the grant. During this period, however, the grantee would be entitled to vote the shares and, at the discretion of the Board, receive dividends. Each certificate would bear a legend giving notice of the restrictions in the grant. Performance Awards. The Board may grant Performance Units or Performance Shares in consideration of services performed or to be performed, under which payment may be made in shares of the Common Stock, a combination of shares and cash, or cash if the performance of the Company or any subsidiary or affiliate of the Company selected by the Board meets certain goals established by the Board during an award period. The Board would determine the goals, the length of an award period and the minimum performance required before a payment would be made. In order to receive payment, a grantee must remain in the employ of the Company until the completion of, and settlement under, the award period, except that the Board may provide complete or partial exceptions to that requirement as it deems equitable. Table of Contents33 Other Stock or Performance-Based Awards. The Board also may grant shares of common stock or performance based Awards on the terms and conditions it determines in its discretion, as well as other rights not an Award otherwise described in the 2010 EIP but is denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, shares of common stock or cash as are deemed by the Board to be consistent with the purposes of the 2010 EIP. Such other stock or performance-based Awards may be in addition to, or in lieu of, cash or other compensation due the grantee. Other Information about the 2010 EIP The 2010 EIP will terminate in 2020 unless terminated earlier by our Board or extended by our Board with the approval of the stockholders. Our Board may amend, suspend or terminate the 2010 EIP at any time, but such amendment, suspension or termination shall not adversely affect any Award then outstanding without the participant s consent. Any amendment that would constitute a material amendment of the 2010 EIP (as determined by the Board, in its sole discretion, subject to the rules and regulations of the OTCBB, if any, governing the use of such term in the context of an employee benefit plan), as amended, shall be subject to stockholder approval. Likewise, if the Exchange Act requires the Company to obtain stockholder approval, then such approval will be sought. Unless approved by stockholders or as specifically otherwise required by the 2010 EIP (for example, in the case of a stock split), no adjustments or reduction of the exercise price of any outstanding incentive may be made in the event of a decline in stock price, either by reducing the exercise price of outstanding incentives or by canceling outstanding incentives in connection with re-granting incentives at a lower price to the same individual. Awards may be exercised only by the Employee, Director, or Consultant to whom they are granted and are generally not assignable or transferable except for limited circumstances upon a grantee s death, or pursuant to rules that may be adopted by the Board. The Board may establish rules and procedures to permit a grantee to defer recognition of income or gain for incentives under the 2010 EIP. It is anticipated that all members of the Board of Directors will participate in the 2010 EIP. Although the 2010 EIP has been approved, the Board of Directors has not contracted with the Company to implement the 2010 EIP into effect. Amendments, Termination, Alteration or Suspension of the plan will impair the rights of any participant, only if mutually agreed to, in writing and signed by the participant and the Company. General Information about the 2010 Service Provider Stock Compensation Plan The Company s 2010 Service Provider Stock Compensation Plan ( SCP ) is intended to promote the interests of the Company and its subsidiaries by offering those officers, directors, employees and consultants or advisors of the Company or any subsidiary who assist in the development and success of the business of the Company or any subsidiary, the opportunity to be compensated for their services in the form of Company stock in lieu of payment in cash. Benefits of the 2010 SCP. The 2010 SCP is registered with the SEC pursuant to the Securities Act. Therefore, all eligible recipients accepting awards of stock for services under the SCP will receive registered stock. Payment for services in the form of registered stock is beneficial to the Company because it enables the Company to preserve its cash while enabling it the possibility of receiving valuable services from service providers. Not all service providers are expected to accept payment in Company stock. Those service providers that accept payment for services in Company Common Stock may liquidate the stock at any time at market price provided there is sufficient volume in the stock at time of sale. Usual investment risks in our Common Stock would apply to the stock issued pursuant to the SCP. Table of Contents34 Administration of the 2010 SCP. The 2010 SCP initially will be administered by the Board of Directors. If it chooses, the Board may delegate its authority to a Board-appointed committee comprised of two or more outside directors as described in Section 162(m) of the Internal Revenue Code of 1986, as amended, for general administration of the SCP. The Board may also delegate its authority to a committee comprised of inside directors to administrate the SCP for non-executive officers and other service providers. The Board or the respective committees establish the terms and conditions of awards granted under the 2010 SCP, interpret the 2010 SCP and all awards under the 2010 SCP, and administer the 2010 SCP. Eligible Participants under the 2010 SCP. Awards under the 2010 SCP may be granted to employees, officers, or directors of the Company or its affiliates, and/or to consultants or advisers currently providing bona fide services to the Company or its affiliates ( Service Providers ). Awards may be made under the SCP only if, at the time of grant, a Form S-8 Registration Statement under the Securities Act ( Form S-8 ) is available to register either the offer or the sale of the Company s securities to such Service Provider because the nature of the services that the Service Provider is providing to the Company is consistent with the instructions governing the use of Form S-8, including the SEC interpretive Releases pertaining to Form S-8, then in effect. No Award under the Plan may be made for services provided in connection with the offer or sale of securities in a capital-raising transaction or for services that directly or indirectly promote or maintain a market for the Company s securities. Shares Available under the 2010 SCP. The aggregate number of shares of Common Stock that may be issued or transferred to grantees under the 2010 SCP shall not exceed 50,000,000 shares. The number of shares of Stock reserved for the SCP shall be adjusted proportionally to reflect, subject to any required action by stockholders, any stock dividend or split, recapitalization, merger, consolidation, spin-off, reorganization, combination or exchange of shares or other similar corporate change. Available shares under a stockholder approved plan of an acquired company (as appropriately adjusted to reflect the transaction) may be used for Awards under the SCP and will not reduce the number of shares available under the SCP, subject to applicable stock exchange requirements. The conversion of any convertible securities of the Company shall not be treated as an increase in shares effected without receipt of consideration. If shares covered by an Award are forfeited or expire, or terminates without delivery of any stock subject thereto, those shares would again be available for inclusion in future Award grants. Other Information about the 2010 SCP The 2010 SCP will terminate automatically in 2020 unless terminated earlier by our Board or extended by our Board with the approval of the stockholders. Our Board may amend, suspend or terminate the 2010 SCP at any time as to any shares of Common Stock as to which awards have not been made. An amendment shall be contingent on approval of the Company s stockholders to the extent stated by the Board, required by applicable law or required by applicable stock exchange requirements. Grant of Options under the 2010 SCP. During fiscal year ended December 31, 2013, we granted an aggregate of 10,000,000 stock options to one of our directors. The stock options are exercisable into shares of common stock at $0.03 per share for a period of ten years. As of the date of this Prospectus, none of the stock options have been exercise. INFORMATION RELATING TO OUTSTANDING SHARES As of May 21, 2014, there were.248,030,860 shares of our common stock issued and outstanding and 2,989,647 shares of our preferred stock issued and outstanding. Except for 50,000,000 shares reserved under our 2010 Equity Incentive Plan, we have not reserved any other shares for issuance upon exercise of common stock purchase warrants or stock options. All of our issued and outstanding common shares (of which 47,385,757 shares are owned by officers, directors and principal stock holders) were issued in a registered transaction or otherwise have been held a period in excess of six months and are eligible to be resold pursuant to Rule 144 promulgated under the Securities Act. Table of Contents35 The resale of our shares of common stock owned by officers, directors and affiliates is subject to the volume limitations of Rule 144. In general, Rule 144 permits our affiliate shareholders who have beneficially-owned restricted shares of common stock for at least six months to sell without registration, within a three-month period, a number of shares not exceeding one percent of the then outstanding shares of common stock. Furthermore, if such shares are held for at least six months by a person not affiliated with us (in general, a person who is not one of our executive officers, directors or principal shareholders during the three month period prior to resale), such restricted shares can be sold without any volume limitation, provided all of the other requirements for resale under Rule 144 are applicable. USE OF PROCEEDS FROM REGISTERED SECURITIES On October 7, 2010, we filed a registration statement with the U.S. Securities & Exchange Commission ( SEC ) on Form S-1 to register 50,000,000 shares of our common stock with the hope of raising up to $1 million in proceeds. The SEC file number of the registration statement is 333-169804. The Form S-1 was declared effective by the SEC on March 25, 2011. The stated primary purposes of the offering are to obtain additional capital to: (1) facilitate product fulfillment (manufacturing, packaging and shipment), which we anticipate will enable future orders to be self funding; (2) provide working capital to finance corporate acquisitions and the integration of new technologies; and (3) retire debt through cash payment or the exchange of debt obligations with payment in registered Common Stock. The offering price for the Company s shares registered in the offering is $0.02 per share for an aggregate offering price of $1 million. The registration statement also registered for resale 1,500,000 shares of restricted common stock issued to one of our consultants in exchange for forgiveness of debt. The consultant may re-offer the shares at market price. The aggregate offering price of the consultant s shares at $0.02 per share is $30,000. As of December 31, 2011, we have not sold or exchanged common stock registered in the registration statement for cash, services, or in exchange for forgiveness of any debt obligation. The offering at all times has been self-underwritten, meaning we have been offering the registered shares ourselves, and we have not entered into an agreement for an underwriter to acquire some or all of the shares registered. The offering expires by its own terms on March 25, 2012.We have not incurred a material amount of expenses in offering the shares for sale because the market price of our common stock was below the fixed offering price provided in the prospectus. Also, we understand that the selling shareholder named in the prospectus has not sold its shares registered in the registration statement. ISSUER PURCHASE OF SECURITIES None. INFORMATION RELATING TO OUTSTANDING SHARES As of May 21, 2014, there were 248,030,860 shares of our common stock issued and outstanding and 5,489,647 shares of our preferred stock issued and outstanding. Except for 50,000,000 shares reserved under our 2010 Equity Incentive Plan, we have not reserved any other shares for issuance upon exercise of common stock purchase warrants or stock options. Of the issued and outstanding common shares, approximately 97,887,415 shares of our common stock (46,948,427 of which are owned by officers, directors and principal stock holders) have been held a period in excess of six months and are eligible to be resold pursuant to Rule 144 promulgated under the Securities Act. Unless covered by an effective registration statement, the resale of our shares of common stock owned by officers, directors and affiliates is subject to the volume limitations of Rule 144. In general, Rule 144 permits our shareholders who have beneficially-owned restricted shares of common stock for at least six months to sell without registration, within a three-month period, a number of shares not exceeding one percent of the then outstanding shares of common stock. Furthermore, if such shares are held for at least six months by a person not affiliated with us (in general, a person who is not one of our executive officers, directors or principal shareholders during the three month period prior to resale), such restricted shares can be sold without any volume limitation. Table of Contents36 CAPITALIZATION The table below sets forth our capitalization as of December 31, 2013 on an actual basis and on a pro forma, as adjusted basis, to give effect to, the issuance of 100,000,000 Shares (the maximum number that may be sold by us in this Offering), 50,000,000 Shares (50% of the Shares offered) and 10,000,000 Shares (10% of the Shares offered) at a hypothetical Offering price of $0.04 per Share and after deducting estimated Offering expenses of approximately $30,073. You should read this table in conjunction with Management s Discussion and Analysis of Financial Condition and Results of Operations , beginning on page 31 of this prospectus and our consolidated financial statements and the related notes beginning on page 42 of this prospectus. March 31, 2014 Shares Issued After March 31, 2014 Assuming All Actual Shares Sold Stockholders' Equity (Deficit): Preferred Stock, Authorized 10,000,000 Shares, $.001 Par Value, Issued and outstanding 3,489,647 3,490 3,490 Common Stock, Authorized 950,000,000 Shares, $.001 Par Value, Issued and Outstanding 248,030,860 248,030 248,030 Issued after March 31, 2014 (7,950,000 shares) 7.950 7,950 Common stock issuable 16,000 16,000 Additional Paid in Capital 26,119,920 151,050 26,119,920 Assuming all 100,000,000 shares are sold 100,000 Paid in capital from offering 3,870,000 Retained Earnings (Deficit) (27,990,057) (27,990,057) Total Capitalization (1,602,617) 159,000 2,526,383 March 31, 2014 Shares Issued After March 31, 2014 Assuming 50% Actual Of Shares Sold Stockholders' Equity (Deficit): Preferred Stock, Authorized 10,000,000 Shares, $.001 Par Value, Issued and outstanding 3,489,647 3,490 3,490 Common Stock, Authorized 950,000,000 Shares, $.001 Par Value, Issued and Outstanding 248,030,860 248,030 248,030 Issued after March 31, 2014 (7,950,000 shares) 7,950 7,950 Common stock issuable 16,000 16,000 Additional Paid in Capital 26,119,920 151,050 26,119,920 Assuming 50,000,000 shares are sold 50,000 Paid in capital from offering 1,920,000 Retained Earnings (Deficit) (27,990,057) (27,990,057) Total Capitalization (1,602,617) 159,000 526,383 Table of Contents37 March 31, 2014 Shares Issued After March 31, 2014 Assuming 10% Actual Of Shares Sold Stockholders' Equity (Deficit): Preferred Stock, Authorized 10,000,000 Shares, $.001 Par Value, Issued and outstanding 3,489,647 3,490 3,490 Common Stock, Authorized 950,000,000 Shares, $.001 Par Value, Issued and Outstanding 248,030,860 248,030 248,030 Issued After March 31, 2014 (7,950,000 shares) 7,950 7,950 Common stock issuable 16,000 16,000 Additional Paid in Capital 26,119,920 151,050 265,221,910 Assuming 10,000,000 shares are sold 5,000 Paid in capital from offering 165,000 Retained Earnings (Deficit) (27,003,334) (27,003,334) Total Capitalization (1,248,394) (1,078,394) MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following analysis of our consolidated financial condition and results of operations for the years ended December 31, 2012 and 2011 should be read in conjunction with the Consolidated Financial Statements and other information presented elsewhere in this Prospectus. OVERVIEW Management believes that heightened attention to personal threats, potential large scale destruction and theft of property in the United States along with spending by the United States government on Homeland Security will continue to drive growth in the market for security products. Our current product lines are related to visual surveillance, intrusion detection and physical security. In October 2012, we were selected for installation in seventeen Detroit public school our ViewScan VS-1000. As of the date of this Annual Report, we have installed thirty-seven. In February 2010 we introduced a new product that we call the MINI (Mobile Intelligent Network Informer). We have received multiple inquires about the need for such a device during 2008 and have invested engineering resources to create a working device. In the fall of 2009 we discovered a device in China that fit our specifications closely so we decided to enter the market with that device instead of continuing to spend our own engineering dollars. We commenced Internet sales efforts of the MINI as a distributor in February 2010. We had a net of seventeen sales in 2010. We have not had additional sales of this product, and we are not actively pursuing sales at this time. During fiscal years ended December 31, 2012 and 2011, we received 22% and 65% of our product sales revenue from a single state municipal agency. If a significant decrease in this revenue occurs in subsequent years it could have a material effect on our financial results. In 2011 we had 21 ViewScan units ordered by correctional facilities of which we delivered 7 units, and 60 units ordered by domestic schools and police departments, of which we delivered 21 units. We also received purchase orders for a total of 12 ViewScan units from a customer in Bangladesh, of which we delivered 2 units in 2011 and the remainder in 2012. Our ability to fill these orders on a timely basis was hampered by a lack of cash needed to acquire the necessary parts. Table of Contents38 Our strategy for 2014 for ViewScan will be to extend our sales and service provisions. To increase sales we offer demonstrations of our products to potential customers in specific geographical areas and at region - specific trade shows, such as sheriff s conventions, court administrators meetings, civil support team, state police and dealer shows. When a demonstration results in a sale of one of our products, then we attempt to expand that market by contacting other potential customers in the area, such as, correctional facilities, courthouses and other municipal buildings. In the short term, management plans to raise funds through sales of our common stock for fulfillment (manufacturing, packaging and shipment), which will set the stage for future orders becoming self funding. Then the next phase of our business plan will be to raise additional funds through common stock offerings to provide working capital to finance several acquisitions and the integration of new technologies and businesses.. We also intend to continue to strengthen our balance sheet by paying off debt either through exchange of equity for cancellation of debt obligations or the payment of debt obligations with cash. When possible we have conserved our cash by paying employees, consultants, and independent contractors with our common stock. As of March 2010, our outstanding equity compensation and equity incentive plans established in 1999 and 2000 had expired by their terms. We implemented two new plans in April and June 2010, respectively. On April 2, 2010, by majority shareholder consent, we adopted our 2010 Equity Incentive Plan. Reserved for equity issuances under the Equity Incentive Plan are 50,000,000 shares of our common stock. On June 1, 2010, by majority shareholder consent, we adopted our 2010 Service Provider Stock Compensation Plan. Reserved for equity issuances under the Service Provider Stock Compensation Plan are 50,000,000 shares of our common stock. On July 21, 2010, we registered the common stock issuable under the 2010 Equity Incentive Plan and the 2010 Service Provider Stock Compensation Plan. A total of 100,000,000 shares are reserved for issuances under the two plans. No Merger or Acquisition Pending in 2013 We have not entered into definite agreements or decisions about any business combination opportunities, although we did have several discussions with interested parties that appeared to be promising. None of those discussions resulted in the execution of a term sheet or other document, and we do not believe that such discussions with such parties will be resumed. However, we continue to explore potential merger and acquisition options. Discontinued Operation Fiber optic contract installations peaked for 2010 in the summer months. Although this market is seasonal and slow in the fall and winter months, we did not secure meaningful subcontract work during 2011. We have chosen not to pursue Fiber optic network installations and have discontinued this area of our business. Form S-1 Registration Statement Declared Effective On October 7, 2010, we filed a registration statement with the U.S. Securities & Exchange Commission ( SEC ) on Form S-1 to register 50,000,000 shares of our common stock with the hope of raising up to $1 million. The Form S-1 was declared effective by the SEC on March 25, 2011. The stated primary purposes of the offering are to obtain additional capital to: (1) facilitate product fulfillment (manufacturing, packaging and shipment), which we anticipate will enable future orders to be self funding; (2) provide working capital to finance corporate acquisitions and the integration of new technologies; and (3) retire debt through cash payment or the exchange of debt obligations with payment in registered common stock. The registration statement also registered for resale 1,500,000 shares of restricted common stock issued to one of our consultants in exchange for forgiveness of debt. Table of Contents39 Having our registration statement declared effective proved to be only the first step in pursuit of restructuring our debts with the help of a registered securities offering. Two circumstances, which may be related, prevented our progress: (1) we have not secured a suitable investment banking relationship through which to underwrite all or part of the offering; and (2) our common stock traded in 2011 at share prices below the $0.02 per share fixed price of the offering, making it impossible to find public buyers for registered stock. We anticipate that we will have greater success in 2013 in selling stock registered in the offering because in our first quarter of 2012 we made our first sales of our registered shares. The registration statement by its terms expires on March 25, 2012. RESULTS OF OPERATIONS FOR THREE MONTH PERIOD ENDED MARCH 31, 2014 The following discussions are based on our consolidated financial statements, including our subsidiaries. These charts and discussions summarize our financial statements for the three months ended March 31, 2014 and March 31, 2013 and should be read in conjunction with the financial statements, and notes thereto, included with our most recent Form 10-K for fiscal year ended December 31, 2013. SUMMARY COMPARISON OF OPERATING RESULTS* Three Month Period ended March 31 2014 2013 Revenues, net $ 90,273 $ 338,230 Cost of sales 19,071 197,490 Gross profit (loss) 71,202 140,740 Total operating expenses 441,332 212,733 Profit (Loss) from operations (370,130) (71,993) Total other income (expense) (8,881) (462,894) Net income (loss) (379,011) (534,887) Net income (loss) per share $ (0.00) $ (0.00) Three Month Period Ended March 31, 2014 Compared to Three Month Period Ended March 31, 2013. Our net loss for the three month period ended March 31, 2014 was ($379,011) compared to a net loss of ($534,887) during the three month period ended March 31, 2013 (a decrease in net loss of $495,876). We generated net revenues of $90,273 during the three month period ended March 31, 2014 compared to $338,230 during the three month period ended March 31, 2013 (a decrease in net revenue of $247,957). During the three month period ended March 31, 2014, revenue consisted of: (i) $53,917 (2013: $320,741) in product sales and installation; and (ii) $36,356 (2013: $17,489) in extended warranties. Revenue is generally considered earned when the product is shipped to the customer. The concealed weapons detection system and the digital video system each require installation and training. Training is a revenue source separate and apart from the sale of the product. In those cases revenue is recognized at the completion of the installation and training. We have experienced a decrease in sales of our products which resulted in decreased revenues for the three month period ended March 31, 2014 compared to the three month period ended March 31, 2013. The decline in decreased revenues was due to a decline in the demand for our security products. Cost of goods sold decreased during the three month period ended March 31, 2014 to $19,071 from $197,490 incurred during the three month period ended March 31, 2013, resulting in a gross profit of $71,202 for the three month period ended March 31, 2014 compared to a gross profit of $140,740 for the three month period ended March 31, 2013. During the three month period ended march 31, 2014, the prevailing trend of decreasing cost of goods sold was due to an decrease in the security-related products ordered by government agencies and due to the decrease in associated costs related to the components of our security-related products, which is based on general overall economic factors. The gross profit percentage on our non-warranty revenue, which is a measurement of gross profit as a percent of sales of products, installations and related revenue, decreased during the three month period ended march 31, 2014 as compared to the three month period ended March 31, 2013. Table of Contents40 Table of Contents Page SUMMARY 1
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+PROSPECTUS SUMMARY The following summary highlights material information found in more detail elsewhere in the Prospectus. It does not contain all of the information you should consider. As such, before you decide to buy our common stock, in addition to the following summary, we urge you to carefully read the entire Prospectus, especially the risks of investing in our common stock as discussed under Risk Factors. In this Prospectus, the terms we, us, our, Mint , Mint Leasing and Company, refer to The Mint Leasing, Inc., a Nevada corporation and its subsidiaries. Common Stock refers to the common stock, par value $0.001 per share, of The Mint Leasing, Inc. Our Company Overview Mint Leasing is a company in the business of leasing automobiles and fleet vehicles throughout the United States. We have been in business since May 1999. Over 600 franchise dealers have signed dealer agreements with the Company. Additionally, Mint Leasing has partnerships with more than 600 dealerships within 17 states. However, most of its customers are located in Texas and seven other states in the Southeast, with the majority of the leases originated in 2013 and 2012 with customers in the state of Texas. We generate partnerships with dealerships through the business relationships our Chief Executive Officer and sole director, Jerry Parish, has built over the past 40 years. Lease transactions are also solicited and administered by the Company s sales force and staff. The Company s primary marketing and sales strategy is to market to automobile dealers that have established a history of directing customers to the Company. We act as an indirect lender to customers. Generally, brand-name automobile dealers with which we have a relationship send us applications of customers for approval in order to allow such customers, which may not meet the higher leasing criteria of those dealerships, to lease new or late-model-year vehicles. We also generate business from pre-existing clients, referrals from non-dealerships and walk-ins. Once we receive an application, the credit analysts at Mint Leasing review every deal individually, refusing to depend on a target beacon score to determine authorization for each deal and instead relying on a common-sense approach for deal approval. Assuming the Company approves credit for the buyer; the Company will purchase the subject automobile directly from the dealership and then lease such automobile directly to the buyer. Once the automobile is purchased by the Company from the dealership, the dealership is no longer involved in the transaction and the buyer pays the Company directly pursuant to the lease terms. If at the end of the lease term, the leasee decides not to purchase the vehicle, the Company will either put the vehicle on its lot to be re-leased or sell it at auction. Similarly, if the leasee defaults under the terms of the lease, the Company will repossess the vehicle and either re-lease it or sell it at auction, depending on the condition of the vehicle and the Company s independent estimation of whether it may be re-leased. The Company s sales are principally accomplished through the Company s sales force, which includes three full-time employees, two credit analysts and two persons who perform funding and verification services. All vehicles are stored at the Company s principal business location set forth below. Approximate Number of Leases In Place As of: December 31, 2010 December 31, 2011 December 31, 2012 December 31, 2013 September 30, 2014 2,000 1,700 1,500 1,100 850 Approximate Value of Leases In Place (In Millions) As of: December 31, 2010 December 31, 2011 December 31, 2012 December 31, 2013 September 30, 2014 $29.7 $25.6 $22.7 $18.3 $14.7 Assets Cash $ 1 Liabilities and Members' Equity Liabilities Accounts payable and accrued liabilities $ 3,000 Members' Equity Member's interest $ 1 Accumulated deficit (3,000 ) (2,999 ) Total Liabilities and Members' Equity $ Members Accumulated Total Interest Deficit Equity Balance at inception, June 26, 2014 $ 1 $ - $ 1 Total comprehensive income income (loss) for the period Loss for the period (3,000 ) (3,000 ) Balance at June 30, 2014 $ Approximate Number of Leases Originated For The Year Ended: December 31, 2010 December 31, 2011 December 31, 2012 December 31, 2013 December 31, 2014 (through September 30, 2014) 432 425 369 311 271 Total Approximate Monthly Revenue and Sources of Revenue As of: December 31, 2011 December 31, 2012 December 31, 2013 September 30, 2014 Individually Leased Vehicles $830,000 $400,000 $210,000 $157,000 Fleet Leased Vehicles $125,000 $420,000 $316,000 $227,000 Other Sources (including the sale of vehicles) $150,000 $100,000 $12,000 ($19,000) Total $1,105,000 $920,000 $538,000 $365,000 The Company has chosen to reduce its total leases over the last three years due to the downturn in the economy; provided that the Company has also been limited in the funds available to it for the purchase of vehicles under its credit facilities, as described in greater detail below under Description of Business Corporate History - Moody Bank Credit Facility , Description of Business Corporate History - Comerica Bank Credit Facility and Description of Business Corporate History MNH Loan Agreement . We currently have approximately 950 cars in our inventory (including vehicles which are being leased). As of the filing of this Prospectus, we had approximately 850 outstanding leases, of which approximately 250 are over 60 days delinquent. Historically, leasees have defaulted on approximately 15% of our leases, which vehicles we have been forced to repossess. We turn over all repossessions to licensed repossession companies. We do not repossess any vehicles ourselves. Payments are received by leasees in the form of cash, automatic bank withdrawals, debit card and credit card payments, and checks. Recent Performance Our financial performance for the years ended December 31, 2013 and December 31, 2012, and the three and nine month periods ended September 30, 2014 and 2013 are summarized below: For the year ended December 31, 2013, total revenues were $6,459,615, compared to $9,973,759 for the year ended December 31, 2012, a decrease in total revenues of $3,514,144 or 35% from the prior year. For the three months ended September 30, 2014, total revenues were $1,411,801 compared to $1,219,748 for the three months ended September 30, 2013, an increase in total revenues of $192,053 or 16% from the prior period. For the nine months ended September 30, 2014, total revenues were $5,668,175, compared to total revenues of $5,672,455, for the nine months ended September 30, 2013, a decrease in total revenues of $4,280, less than 1% from the prior period. Cost of revenues decreased $177,855 to $6,101,425 for the year ended December 31, 2013, compared to $6,279,280 for the year ended December 31, 2012. As filed with the Securities and Exchange Commission on December 30, 2014 Registration No. 333-182010 Cost of revenues increased $1,140,455 or 150% to $1,902,586 for the three months ended September 30, 2014, as compared to $762,131 for the three months ended September 30, 2013. Cost of revenues increased $52,662 or 1% to $5,020,702 for the nine months ended September 30, 2014, as compared to $4,968,040 for the nine months ended September 30, 2013. Gross profit decreased $3,336,289 or 90% to a gross profit of $358,190 for the year ended December 31, 2013 compared to a gross profit of $3,694,479 for the year ended December 31, 2012. Gross profit as a percentage of revenue decreased from positive 37% for the three months ended September 30, 2013, to a negative 35% for the three months ended September 30, 2014. Gross profit decreased $56,942 to $647,473 for the nine months ended September 30, 2014 compared to gross profit of $704,415 for the nine months ended September 30, 2013. The 8% decrease in gross profit was due to the 8% increase in total cost of revenues offset by the less than 1% increase in total revenues. General and administrative expenses were $2,461,913 and $2,350,827 for the years ended December 31, 2013 and December 31, 2012, respectively, resulting in an increase of $111,086 or 5% from the prior period. General and administrative expenses were $857,552 and $743,437, for the three months ended September 30, 2014 and September 30, 2013, respectively, constituting an increase of $114,115 or 15% from the prior period. General and administrative expenses were $1,930,605 and $2,051,663, for the nine months ended September 30, 2014 and September 30, 2013, respectively, constituting a decrease of $121,058 or 6% from the prior period. Other income, primarily gain on debt refinance partly offset by interest expense, was $5,328,937 for the year ended December 31, 2013 and other expense, primarily interest expense, was $1,582,621 for the year ended December 31, 2012. Total other expense was $11,072,916 and $646,596, for the three months ended September 30, 2014 and September 30, 2013, respectively, an increase of $10,426,3211 or 1,612% from the prior period. Total other expense was $14,065,007 and $1,448,014, for the nine months ended September 30, 2014 and September 30, 2013, respectively, an increase of $12,616,993 or 871% from the prior period. The Company had net income of $3,225,214 for the year ended December 31, 2013, compared to a net loss of $238,969 for the year ended December 31, 2012, an improvement of $3,464,183 from the prior year. The Company had a net loss for the three months ended September 30, 2014 of $12,421,253 compared to a net loss of $932,416 for the three months ended September 30, 2013. The Company had a net loss for the nine months ended September 30, 2014 of $15,348,138 compared to a net loss of $2,795,262 for the nine months ended September 30, 2013. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1/A Amendment No. 8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 The Mint Leasing, Inc. (Name of registrant in its charter) Nevada 6172 87-0579824 (State or jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (IRS Employer Identification No.) 323 N. Loop West Houston, Texas 77008 Phone: (713) 665-2000 (Address and telephone number of principal executive offices and principal place of business or intended principal place of business) Jerry Parish, Chief Executive Officer 323 N. Loop West Houston, Texas 77008 Phone: (713) 665-2000 (Name, address and telephone number of agent for service) Copies to: David M. Loev John S. Gillies The Loev Law Firm, PC The Loev Law Firm, PC 6300 West Loop South, Suite 280 & 6300 West Loop South, Suite 280 Bellaire, Texas 77401 Bellaire, Texas 77401 Phone: (713) 524-4110 Phone: (713) 524-4110 Fax: (713) 524-4122 Fax: (713) 456-7908 Approximate date of proposed sale to the public: as soon as practicable after the effective date of this Registration Statement. If any of the Securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act Registration Statement number of earlier effective Registration Statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. [ ] Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [X] CALCULATION OF REGISTRATION FEE Title of Each Class of Securities To be Registered Amount Being Registered (1) Proposed Maximum Aggregate Price Amount of Registration Fee (2) Common Stock, par value $0.001 per share 70,000,000 (2) $42,000,000 $4,880.40 Total 70,000,000 $42,000,000 $4,880.40 (1) This registration statement covers an indeterminate number of shares of common stock that may be sold by the registrant from time to time, for a maximum aggregate offering price of all securities not to exceed $42,000,000. Pursuant to Rule 416(b) of the Securities Act of 1933, as amended, the shares of common stock being registered hereunder includes an indeterminate number of shares of common stock as may be issuable with respect to the shares being registered hereunder resulting from the split of, or the stock dividend on, the registered securities. (2) The registration fee has been calculated in accordance with Rule 457(o) of the Securities Act of 1933, as amended. The Registrant hereby amends its Registration Statement, on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Industry Segment With the average cost of new cars rising annually, it is becoming increasingly vital for consumers to understand the alternative financing options at their disposal. This is one of the core missions of Mint Leasing to educate the average consumer about financing alternatives. It is imperative that consumers understand that by choosing to lease the vehicle, rather than purchase, they may reduce their risk and save money. Mint Leasing believes it provides consumers with the best of both worlds the ability to drive their dream car, without having to spend more than they can afford. With car and housing prices at all-time highs over the past decade; the auto leasing industry has increased in popularity. Mint Leasing maintains two significant, distinct client sectors (1) The Franchise Dealer and (2) The Individual Consumer. The Advantages of Mint Leasing Mint Leasing offers a different approach to auto financing. Mint Leasing doesn t rely on Finance Managers and salesmen to verify customers applications. Mint Leasing relies on its trained, experienced credit analysts to verify every transaction. Mint Leasing has entered into financial relationships with over 600 dealerships as a premier source for outside financing. Because the agreements with the dealerships have been pre-negotiated, Mint Leasing is able to quickly and efficiently respond to the dealerships and the individual customer s immediate needs. The Company uses a standard form of Dealer Agreement. The Dealer Agreement requires the Company to pay the dealer within 30 days of the Company s approval date, the purchase price of any vehicle; requires the dealer to collect all down payments from customers; requires the dealer, within 20 days from the date of purchase, to file all documentation necessary for the Company to have a perfected security interest in the vehicle; and requires the dealer to indemnify the Company against any breach of any provision of the dealer agreement. The Company requires the dealer to execute its form of Dealer Agreement. As a partner with the dealership, the finance manager/sales consultant at the dealership can enter the application information into the sales office computer while sitting beside the customer. The application is then instantly transmitted to Mint Leasing for approval. Approvals are displayed instantly, allowing the franchise dealer to quickly close the transaction. Rather than rely on a weighted average credit score of the end customer, Mint Leasing chooses to apply a common sense approach to financing. While the customer s credit score is taken into account, there is no minimum, or beacon score to determine approval. However, Mint Leasing does recognize the inherent risk in lending to non-prime or sub-prime borrowers. Mint Leasing takes into account several factors when considering whether a potential customer s application will be approved or not, including the individual s (the percentage next to each criteria is the approximate weight given to each factor); credit score and history (10%); the stability in the customer s residence (e.g., homeowner or not, how long lived at current address) (30%), job stability (45%), age (5%), and income (10%). Currently approximately 60% of the Company s leases are fleet leases and 40% are sub-prime and non-prime borrowers. Mint Leasing offers quality, affordable leasing to at-risk borrowers to provide customers with the freedom associated with a vehicle. Because of this mission, the Company employs a reasonableness test to determine the fitness of the transaction. Mint Leasing relies on the decades of experience within its staff to determine the character of the lease application. This standard ensures that every transaction is approved or disapproved by a person, and not a computer. Need for Additional Funding The availability of financing sources depends, in part, on factors outside of our control, including the availability of bank liquidity in general. The current disruptions in the capital markets have caused banks and other credit providers to restrict availability of new credit facilities and require more collateral and higher pricing upon renewal of existing credit facilities, if such facilities are renewed at all. Accordingly, in order to obtain new financing to refinance our currently outstanding credit and debt facility or to obtain additional credit facilities, we may be required to provide more collateral in the form of finance receivables or cash to support borrowing levels which will affect our financial position, liquidity, and results of operations. In addition, higher pricing would increase our cost of funds and adversely affect our profitability. We do not currently have any commitments of additional capital from third parties or from our sole officer and director or majority shareholders. Additional financing may not be available on favorable terms, if at all. If we choose to raise additional capital through the sale of debt or equity securities, such sales may cause substantial dilution to our existing shareholders. If we are not able to extend our credit and debt facilities, obtain new credit facilities or to raise the capital necessary to repay the facilities and our outstanding notes payable, we may be forced to abandon or curtail our business plan, which may cause any investment in the Company to become worthless. If we are unable to continue our operations, we may be forced to file for bankruptcy protection, may be forced to cease our filings with the Securities and Exchange Commission, and the value of our securities may decline in value or become worthless. The information in this Prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This Prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED DECEMBER 30, 2014 PROSPECTUS The Mint Leasing, Inc. 70,000,000 Shares of Common Stock Offered by The Mint Leasing, Inc. We are selling 70,000,000 shares of common stock. The public offering price will be $0.60 per share. If fully subscribed we anticipate receiving $42,000,000 in total proceeds from this offering prior to deducting expenses associated with the offering, which we anticipate totaling approximately $95,000. Our common stock is currently quoted on the OTCQB market maintained by OTC Markets Group Inc. under the symbol MLES. On December 30, 2014 (the last date that our common stock traded on the OTCQB prior to the date of this Prospectus), the last reported sale price of our common stock as reported on the OTCQB was $0.20 per share. There is no minimum number of shares that must be sold by us for the offering to proceed, and we will retain the proceeds from the sale of any of the offered shares. The offering is being conducted on a self-underwritten, best efforts basis, which means our management (i.e., our sole officer and director), will attempt to sell the shares. This Prospectus will permit our President and sole director, Jerry Parish, to sell the shares directly to the public, with no commission or other remuneration payable to him for any shares he may sell. Mr. Parish will sell the shares and intends to offer them to friends, family members and business acquaintances. In offering the securities on our behalf, he will rely on the safe harbor from broker-dealer registration set out in Rule 3a4-1 under the Securities and Exchange Act of 1934, as amended. The shares will be offered at $0.60 per share for the duration of the offering. Any funds that we raise from our offering of 70,000,000 shares of common stock will be immediately available for our use and will not be returned to investors. We do not have any arrangements to place the funds received from our offering of 70,000,000 shares of common stock in an escrow, trust or similar account. You will not have the right to withdraw your funds during the offering. We may offer and sell these securities through the method described under Plan of Distribution in this Prospectus. This offering will terminate upon the earlier to occur of (i) sixty days after the Registration Statement which this Prospectus forms a part becomes effective with the Securities and Exchange Commission, provided, however, that we may, at our discretion and without prior notice, extend the offering for an additional sixty days, and (ii) the date on which all 70,000,000 shares registered hereunder have been sold. The information in this Prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This Prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Recent Events KBM Worldwide, Inc. Convertible Note On July 9, 2014, the Company sold KBM Worldwide, Inc. (the Investor ) a Convertible Promissory Note in the principal amount of $158,500 (the Convertible Note ), pursuant to a Securities Purchase Agreement, dated the same day (the Purchase Agreement ). The Convertible Note bears interest at the rate of 8% per annum (22% upon an event of default) and is due and payable on April 15, 2015. All or any portion of the principal amount of the Convertible Note and all accrued interest is convertible at the option of the holder thereof into the Company s common stock at any time following the 180th day after the Convertible Note was issued. The conversion price of the Convertible Note is equal to the greater of (a) $0.00005 per share, and (b) 61% multiplied by the average of the three lowest trading prices of the Company s common stock on the ten trading days before any conversion (representing a discount of 39%). The conversion price is also subject to dilutive protection as provided in the Convertible Note. At no time may the Convertible Note be converted into shares of common stock of the Company if such conversion would result in the Investor and its affiliates owning an aggregate of in excess of 4.99% of the then outstanding shares of the Company s shares of common stock. The Company may prepay in full the unpaid principal and interest on the Convertible Note, upon notice any time prior to the 180th day after the issuance date. Any prepayment is subject to payment of a prepayment amount ranging from 110% to 135% of the then outstanding balance on the Convertible Note (inclusive of accrued and unpaid interest and any default amounts then owing), depending on when such prepayment is made. The Convertible Note also provided for anti-dilution rights in the event the Company issued or sold, except for certain limited exceptions, shares of the Company s common stock. Pursuant to an amendment to the Convertible Note entered into on October 27, 2014, the provisions of the note relating to anti-dilution for future issuances was removed from the Convertible Note. The Company plans to repay the loan prior to any conversion. Jerry Parish Loans On July 18, 2014, Jerry Parish, our sole officer and director and majority shareholder, loaned the Company $240,000 which accrues interest at the rate of 10% per annum, is due and payable (along with accrued interest) on July 18, 2015, and is evidenced by a Promissory Note. In August 2014, Mr. Parish loaned the Company an additional $49,000, which is not evidenced by a promissory note. Share Exchange Effective September 23, 2014, we entered into and closed the transactions contemplated by a Share Exchange Agreement (the Exchange Agreement ) with Investment Capital Fund Group, LLC Series 20, a Delaware limited liability company, organized as a Delaware Series Business Unit ( ICFG ) and the sole shareholder of ICFG, Sunset Brands, Inc., a Nevada corporation ( Sunset ). Pursuant to the Exchange Agreement, we acquired 100% of the issued and outstanding voting shares and 99% of the issued and outstanding non-voting shares of ICFG in exchange for 62,678,872 shares of our restricted common stock (representing 42.3% of our post-closing common stock, based on 85,654,416 shares of common stock issued and outstanding immediately prior to the closing of the Exchange Agreement and 148,333,288 shares of common stock issued and outstanding immediately after the closing). ICFG owns 52 Gem Assets 52 Sapphires from the King and Crown of Thrones collection , which have a total carat weight of 3,925.17, and have been appraised by a Gemological Institute of America Inc. (GIA) graduate gemologist, to have a Retail Replacement Value as of August 30, 2014 of $108,593,753 and a Fair Market Value (65% of the Retail Replacement Value) of $70,585,940 (the Assets ), the rights to which and ownership of were acquired by the Company in connection with the closing of the Exchange Agreement. THERE ARE SIGNIFICANT RISKS TO THE OFFERING AND THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK, INCLUDING THE RISK THAT WE WILL BE UNABLE TO CONTINUE AS A GOING CONCERN. YOU SHOULD PURCHASE SHARES ONLY IF YOU CAN AFFORD A COMPLETE LOSS. WE URGE YOU TO READ THE RISK FACTORS SECTION BEGINNING ON PAGE 13, ALONG WITH THE REST OF THIS PROSPECTUS BEFORE YOU MAKE YOUR INVESTMENT DECISION. NEITHER THE SECURITIES AND EXCHANGE COMMISSION ( SEC ) NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE DATE OF THIS PROSPECTUS IS ________________, 2014 The King and Crown of Thrones collection relates to a collection of cut and polished stones which are believed to have originally decorated the Khajuraho Group of Monuments/Temples, which are a group of Hindu and Jain temples located in Madhya Pradesh, India. The collection dates back to between 801-1030 A.D. During the three months ended September 30, 2014, we recorded an asset impairment charge of $10,028,620 related to our acquisition of ICFG. The impairment charge was based on our recognition of the book value at $0 as of September 23, 2014, compared to the consideration given of $10,028,620 on September 23, 2014. The Assets have a current book value on the balance sheet of the Company, as of the date of this Prospectus of $0. The beneficial owner (i.e., the person with investment and dispositive control) of the shares acquired by Sunset is J. Bert Watson, Sr., its Chairman. The Company plans to use the Assets acquired as collateral to obtain additional funding. While the Exchange Agreement has been executed by both parties and we believe the transactions contemplated by such agreement have closed to date and that both parties are fully obligated to perform under the agreement, we have yet to deliver the shares due to Sunset and Sunset has yet to deliver us physical possession of the gemstones. Notwithstanding the above, we believe in good faith that the failure of each party to deliver the consideration due in connection with the Exchange Agreement is solely due to desire of such parties to meet face-to-face with consideration in hand to complete the transaction, which has been unable to be scheduled to date. MotorMax Letter of Intent On October 27, 2014, we entered into a First Amendment to and Assignment of Letter of Intent (the Assignment ), pursuant to which Investment Capital Fund Group, LLC, a wholly-owned subsidiary of Sunset, assigned all of its rights to Mint Leasing under a letter of intent between Investment Capital Fund Group, LLC and the shareholders of Motors Acceptance Corporation, MotorMax Financial Services Corporation and MotorMax Auto Group, Inc. (collectively MotorMax and the Letter of Intent ). Pursuant to the Letter of Intent, as amended by the Assignment, Mint Leasing agreed to pay a total of $30 million to the owners of MotorMax in consideration for 100% of MotorMax, of which $25 million (subject to net capital adjustments at closing) is payable in cash and $5 million is payable in stock; we agreed to provide proof of ability to raise the $25 million in cash by December 15, 2014; and agreed to close the transactions contemplated by the Letter of Intent, including our entry into a formal Securities Purchase Agreement with the owners of MotorMax, prior to January 15, 2015 (provided that MotorMax is required to maintain exclusivity with us through such date). The cash consideration payable in connection with the acquisition will be used to repay certain obligations of MotorMax other than certain credit facilities which will be assumed by the Company. We plan to issue the $5 million of the purchase price payable in stock as restricted common stock, subject to the shareholders of MotorMax making representations and confirmations in the definitive purchase agreement sufficient for us to rely on an exemption from registration for the issuance of such securities. The closing of the transactions contemplated by the Letter of Intent are subject to among other things, us and the owners of MotorMax negotiating a mutually acceptable Securities Purchase Agreement, our due diligence, us raising adequate funding to complete the transaction, which may not be available on favorable terms, if at all, and the approval of the acquisition by our senior lender. Sunset, which assigned us its rights under the Letter of Intent, was previously the owner of Investment Capital Fund Group, LLC Series 20, a Delaware limited liability company, organized as a Delaware Series Business Unit, which held various gem assets which we acquired pursuant to a Share Exchange Agreement in consideration for 62,678,872 shares of our restricted common stock on September 23, 2014, which have not been physically issued as of the date of this Prospectus, but which shares the Company plans to issue shortly after the date of this Prospectus. MotorMax is a direct subprime automotive finance company located in Columbus, Georgia, with a 40 year history in consumer finance. MotorMax is currently originating approximately 1,200-1,500 automotive retail contracts per month. MotorMax consists of (1) a finance company (Motors Acceptance Corporation) which underwrites, finances and services all of the directly originated loans; (2) retail operations (MotorMax Auto Group, Inc.), which has sales operations in Georgia and Alabama where it operates nine dealerships; and (3) a consumer finance company (MotorMax Financial Services Corporation) licensed in Georgia, Alabama, South Carolina and Missouri. TABLE OF CONTENTS Page Prospectus Summary 1
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary may not contain all the information that may be important to you. You should read this entire prospectus, including the financial data and related notes, before making an investment decision. See the section entitled Risk Factors on page 5 for a discussion of certain factors to be considered in connection with making an investment in the notes being offered under this prospectus. The Company Jazz Technologies, Inc., through its wholly owned subsidiaries, is an independent pure-play semiconductor foundry focused on specialty process technologies for the manufacture of analog and mixed-signal semiconductor devices. Typically, pure-play foundries do not offer products of their own, but focus on producing integrated circuits, or ICs, based on the design specifications of their customers. We manufacture semiconductors for our customers primarily based on third party designs and our own process technology and engineering support. We also provide design support and complementary technical services. ICs manufactured by us are incorporated into a wide range of products in diverse markets, including cellular phones, wireless local area networking devices, digital TVs, set-top boxes, gaming devices, switches, routers and broadband modems. Our principal executive offices are located at 4321 Jamboree Road, Newport Beach, California 92660, and our telephone number is (949) 435-8000. The Offering Securities Offered Under This Prospectus We previously issued $58,307,000 aggregate principal amount of 8% Convertible Senior Notes due December 2018. The notes are convertible, under specified circumstances, into ordinary shares of our parent company, Tower Semiconductor, Ltd. The selling security holders identified herein may, from time to time, use this prospectus to resell the notes. Use of Proceeds The notes covered by this prospectus are being offered by certain selling security holders and not by our company. Consequently, our company will not receive any proceeds from the sale of these notes. Summary of the Terms of the Notes Issuer Jazz Technologies, Inc., a Delaware corporation. Notes Offered $58,307,000 aggregate principal amount of 8% senior convertible notes due December 2018. Maturity Date December 31, 2018. Interest 8% per year, payable semiannually in arrears in cash on July 15 and January 15, commencing on July 15, 2014. Guarantees The notes are fully and unconditionally, and jointly and severally, guaranteed on an unsecured senior basis by our domestic subsidiaries. Ranking The notes are unsecured senior obligations of our company and rank equally with all of our existing and future unsecured senior debt and senior to all of our existing and future subordinated debt. The notes effectively rank junior to any of our existing and future secured debt to the extent of the value of the assets securing such debt. As of March 31, 2014, the notes rank (1) equally with approximately $49 million principal amount of other unsecured senior debt, which constitute of the notes due June 2015 of our company and the guarantors and (2) effectively subordinated to our up to $70 million Wells Fargo credit line, under which our actual borrowings as of March 31, 2014 were $19 million. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer o Accelerated filer o Non-accelerated filer Smaller reporting company o (Do not check if a smaller reporting company) CALCULATION OF REGISTRATION FEE Proposed Maximum Proposed Maximum Amount of Title of Each Class of Amount to be Offering Aggregate Registration Securities to be Registered Registered Price per Unit (1) Offering Price (1) Fee 8% Convertible Senior Notes due 2018 $ 58,307,000 100 % $ 58,307,000 $ 7,510 Guarantees of 8% Convertible Senior Notes due 2018 (2) (3 ) Total $ 58,307,000 $ 58,307,000 $ 7,510 (1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(a) under the Securities Act of 1933, as amended. (2) See the following page for a table of guarantor registrants. (3) Pursuant to Rule 457(n), no additional registration fee is payable with respect to the guarantees. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the SEC acting pursuant to said Section 8(a), may determine. Conversion Privilege Subject to compliance with the provisions of the indenture governing the notes, the holder of a note is entitled, at its option, at any time prior to the maturity date, to convert the note or any portion of the principal amount thereof that is an integral multiple of U.S. $1,000 into ordinary shares of our parent company, Tower Semiconductor, Ltd, at the conversion rate and under other conditions as provided in the indenture. See "Description of the Notes Conversion Privilege." Change of Control If we experience specific kinds of change of control events, we must offer to repurchase the notes at a price of 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See "Description of the Notes Change of Control." Certain Covenants The indenture governing the notes contains certain customary covenants including covenants restricting our ability and the ability of our subsidiaries to, among other things, incur additional debt, incur additional liens, make specified payments and make certain asset sales. Each of these covenants is subject to important exceptions and qualifications. See "Description of the Notes Certain Covenants." Absence of Trading Market for Notes We do not intend to apply for a listing of the notes on any securities exchange, quotation system or on PORTAL. Accordingly, we cannot assure you that a liquid market for the notes will develop or be maintained. Trustee U.S. Bank National Association
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001210294_crailar_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001210294_crailar_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. Because this is only a summary, it does not contain all of the information that may be important to you. You should read the entire prospectus carefully, including the information under the heading "Risk Factors" beginning on page 7, before you invest in our securities. Unless otherwise indicated or the context requires otherwise, all references in this prospectus to "we," "us," "our company," the "Company" and "CRAiLAR" refer to CRAiLAR Technologies Inc., a British Columbia corporation, and its consolidated subsidiaries. All references in this prospectus to "$" are to U.S. dollars and all references to "CAD$" are to Canadian dollars. Our functional currency is the Canadian dollar; we translate our financial information to U.S. dollars as follows: (i) all assets and liabilities have been translated into U.S. dollars at the exchange rate in effect at the applicable fiscal period-end and (ii) revenues and expenses have been translated throughout the period at the weighted average exchange rate. Our Company Overview CRAiLAR is focused on bringing sustainable bast fiber-based products to market that are environmentally friendly natural fiber alternatives with equivalent or superior performance characteristics to cotton, wood or fossil-fuel based fibers. Our business operations consist primarily of the production of our natural and proprietary CRAiLAR Flax fibers targeted at the natural yarn and textile industries, as well as the deployment of our CRAiLAR processing technologies in the cellulose pulp and composites industries. We believe that we offer two key opportunities for development: CRAiLAR fibers (using flax, hemp or other sustainable bast fiber) for textiles (knit, woven and non-woven constructions) available in a variety of blends, textures, colors and applications; and CRAiLAR technologies for processing cellulose-based fibers as a high grade dissolving pulp for use in the additives, ethers and performance apparel markets. We hold the exclusive worldwide license to these patented CRAiLAR technologies. We believe that fibers and yarns produced with the CRAiLAR process will be competitively priced relative to currently available natural and synthetic fibers and have the benefit of being environmentally responsible. The CRAiLAR patented process effectively cleans and polishes raw bast fiber, such as flax, hemp, kenaf and jute bast fibers, into fiber substantially equivalent to ginned cotton. It is our belief that the CRAiLAR brand has the potential to become a consumer recognized performance brand that is valued and demanded by the market. We believe that entering into development and supply agreements with some of the world's largest fiber consuming companies is the best path to successful commercialization of a number of products incorporating our CRAiLAR technologies. In execution of this strategy, we have entered into development and supply agreements with companies such as adidas AG, Georgia-Pacific, Hanesbrands Inc., IKEA, Lenzing and Levi Strauss & Co. We have supply agreements with category exclusivity clauses with certain customers that require them to purchase, in the aggregate, approximately 7.4 million pounds of CRAiLAR Flax fibers in 2014 and approximately 8.5 million pounds in 2015 (when multi-year requirements are averaged to an annual amount) in order to retain their exclusive rights. Industry With the projected increase in the global population and continued development of market economies, we expect to see a rise in the need for textile fibers worldwide. According to Gherzi, a global management consulting company focused on the textile industry, the global demand for textile fibers is expected to exceed 100 million tons by 2020. Gherzi estimates there were 81.0 million tons of fibers produced globally in 2011 and synthetic fibers (such as polyester) accounted for 59.2% of such fibers, cotton accounted for 33.7%, cellulose-based fibers (such as viscose and rayon) accounted for 5.7% and wool accounted for 1.4% . More generally, according to Gherzi, it is estimated that the demand for textile fibers is expanding approximately 3% per year mainly due to two macroeconomic trends: (i) ongoing population growth and (ii) increase in prosperity which generates additional demand, particularly in emerging economies. In addition, sustainability and climate change concerns are contributing to consumers increasingly preferring products manufactured with a minimal environmental impact and use of resources. As filed with the Securities and Exchange Commission on July 31, 2014 Registration No. 333-195508 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 2 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 CRAILAR TECHNOLOGIES INC. (Exact name of registrant as specified in its charter) British Columbia 5600 98-0359306 (State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer Identification No.) incorporation or organization) Classification Code Number) Suite 305, 4420 Chatterton Way, Victoria, British Columbia, Canada, V8X 5J2 Telephone: (250) 658-8582 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Theodore R. Sanders Chief Financial Officer 629 McVey Avenue Lake Oswego, Oregon, U.S.A., 97034 Telephone: (503) 387-3941 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Thomas J. Deutsch Ellen S. Bancroft McMillan LLP Morgan, Lewis & Bockius LLP Royal Centre, 1055 West Georgia Street, Suite 1500 5 Park Plaza, Suite 1750 Vancouver, British Columbia, Canada, V6E 4N7 Irvine, California, U.S.A., 92614-3508 Telephone: (604) 689-9111 Telephone: (949) 399-7000 As soon as practicable after the effective date of this registration statement. (Approximate date of commencement of proposed sale to the public) If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box: [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registrations statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. [ ] Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X] Smaller reporting company (Do not check if a smaller reporting company) ABOUT THIS PROSPECTUS You should rely only on the information contained in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where such offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date. Our name, our logo and other trademarks or service marks of ours appearing in this prospectus are the property of CRAiLAR Technologies Inc. Trade names, trademarks and service marks of other companies appearing in this prospectus are the property of their respective holders. FOR CALIFORNIA RESIDENTS: With respect to sales of the securities being offered hereby to California residents, such securities may be sold only to: (1) "accredited investors" within the meaning of Regulation D under the Securities Act of 1933 (the "Securities Act"), (2) "qualified institutional buyers" within the meaning of Rule 144A under the Securities Act, (3) banks, savings and loan associations, trust companies, insurance companies, investment companies registered under the Investment Company Act of 1940, pension or profit-sharing trusts, corporations or entities which, together with the corporations or other affiliates which are under common control, have a net worth on a consolidated basis according to their most recent regularly prepared financial statements of not less than $14,000,000 and subsidiaries of the foregoing or (4) any person (other than a person formed for the sole purpose of purchasing the securities being offered hereby) who purchases at least $1,000,000 aggregate amount of the securities offered hereby. Each broker-dealer selling the securities offered hereby has procedures in effect designed to ensure that each California purchaser comes within one of the foregoing categories and each California resident purchasing the securities offered hereby pursuant to this prospectus will be deemed to represent by such purchase that it comes within one of the aforementioned categories. Each person purchasing the securities offered hereby (whether or not a California resident) will be deemed to represent that it will not sell or otherwise transfer such securities pursuant to this prospectus to a California resident unless the transferee comes within one of the aforementioned categories and that it will advise the transferee of this condition which transferee, by becoming such will be deemed to be bound by the same restrictions on resale pursuant to this prospectus. FOR INVESTORS OUTSIDE THE U.S.: Neither we nor the underwriters have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required other than in the U.S. You are required to inform yourselves about and to observe any restrictions relating to this offering and the distribution of this prospectus. FOR INVESTORS IN THE UNITED KINGDOM: This prospectus is only being distributed to, and is only directed at, persons in the United Kingdom that are qualified investors within the meaning of section 86(7) of the Financial Services and Markets Act 2000 that are also (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (ii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (each such person being referred to as a "Relevant Person"). This prospectus and its contents are confidential and should not be distributed, published or reproduced (in whole or in part) or disclosed by recipients to any other persons in the United Kingdom. Any person in the United Kingdom that is not a Relevant Person should not act or rely on this prospectus or any of its contents." EUROPEAN ECONOMIC AREA: Public offer selling restriction under the Prospectus Directive. The Units may not be offered to the public in any Member State of the European Economic Area which has implemented the Prospectus Directive (each, a "Relevant Member State"), except that Units may be offered to the public in a Relevant Member State (a) to any legal entity which is a qualified investor as defined in the Prospectus Directive; (b) to fewer than 100, or, if each Relevant Member State in which Units are offered has implemented the relevant provision of the 2010 PD Amending Directive, 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive; or (c) in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that that no such offer of Units referred to in (a) to (c) above shall require the issuer or the underwriters to publish a prospectus pursuant to Article 3 of the Prospectus Directive, or supplement a prospectus pursuant to Article 16 of the Prospectus Directive. For the purposes of this provision, the expression an "offer to the public" in relation to any Units in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Units to be offered so as to enable an investor to decide to purchase or subscribe the Units, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State; the expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State; and the expression "2010 PD Amending Directive" means Directive 2010/73/EU. NOTICE TO INVESTORS IN SWITZERLAND: This document is not intended to constitute an offer or solicitation to purchase or invest in the equity securities described herein. The equity securities may not be publicly offered, sold or advertised, directly or indirectly, in, into or from Switzerland and will not be listed on the SIX Swiss Exchange or on any other exchange or regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating to the equity securities constitutes a prospectus as such term is understood pursuant to article 652a or article 1156 of the Swiss Code of Obligations or a listing prospectus within the meaning of the listing rules of the SIX Swiss Exchange or any other regulated trading facility in Switzerland or a simplified prospectus or a prospectus as such term is defined in the Swiss Collective Investment Scheme Act, and neither this document nor any other offering or marketing material relating to the equity securities may be publicly distributed or otherwise made publicly available in Switzerland. Neither this document nor any other offering or marketing material relating to the offering, nor the equity securities have been or will be filed with or approved by any Swiss regulatory authority. The equity securities are not subject to the supervision by any Swiss regulatory authority, e.g., the Swiss Financial Markets Supervisory Authority FINMA (FINMA), and investors in the equity securities will not benefit from protection or supervision by such authority. INDUSTRY DATA We use industry and market data throughout this prospectus, which we have obtained from market research, independent industry publications or other publicly available information. The information contained in such sources has not been independently verified. Such data is also subject to change based on various factors, including those discussed under the heading "Risk Factors" in this prospectus. We expect our CRAiLAR Flax fiber to be cost competitive with other fibers currently available once we have a fully integrated production facility in operation. The CRAiLAR Solution The CRAiLAR patented technology and process uses enzymes to effectively clean and polish raw bast fiber, such as flax, hemp, kenaf and jute bast fibers, into fiber substantially equivalent to ginned cotton. This solution is clean, sustainable and environmentally responsible. Bast fiber plants grow abundantly and, when compared with cotton, require 97% less water and substantially less herbicides, fertilizers and pesticides. In April 2012, the USDA designated CRAiLAR as a 100% BioPreferred product. As a result of CRAiLAR's various innovations, use of flax feedstock and robust water savings, CRAiLAR Flax fibers have been recently awarded a B' classification (Sustainable) by the MADE-BY organization, a European not-for-profit organization with a mission to improve environmental and social conditions in the fashion industry. This classification certifies that the benefits of CRAiLAR Flax, from an environmental impact perspective, far outweigh that of polyester and conventional cotton (both ranked Less Sustainable). The MADE-BY organization and environmental benchmark supports brands and manufacturers in limiting the impact of its materials on the environment and advises them on sustainable alternatives. In this benchmark, the processing of a large range of materials from raw to yarn are compared in relation to emissions produced, their use of land space, pesticides, chemicals, water and energy. The CRAiLAR fiber technology was developed by the National Research Council of Canada (the "NRC"). The NRC granted to us the exclusive worldwide license to the patented technology, which currently includes two patents covering the extraction of hemp fibers and preparation of bast fibers. Under development since 2004, this technology has undergone successful final demonstration scale testing and we are now delivering CRAiLAR Flax fiber to our customers. We continue to work with the NRC on the development of enhancements to our core technologies that are covered by the NRC license. The license expires upon the expiration of the last patent claim covered by the license, which is currently in December 2029. Products Our products include CRAiLAR fiber for the textile market, which is manufactured using a clean, sustainable, environmentally responsible process, and cellulose-based fibers as a high grade dissolving pulp for use in the additives, ethers and performance apparel markets. We are also in the process of investigating by-product opportunities utilizing seed and shive. Our Competitive Strengths We believe that we have a number of strengths that differentiate us and create the foundation for continued sales and profitable growth. All of our fiber products are designed to deliver superior performance. In apparel, we expect CRAiLAR Flax fibers will be blended with cotton, resulting in a better performing fabric than cotton alone. When blended at 80% cotton and 20% CRAiLAR fibers, the resulting fabric takes on the many superior characteristics of CRAiLAR Flax fibers, wicking approximately 50% more moisture when compared to cotton and almost as much moisture as high performance synthetic fibers, reducing shrinkage by up to 50% and requiring up to 10% less dye material. In addition, we offer high quality natural fibers that are an alternative to cotton and pulp users. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Proposed Maximum Aggregate Offering Price Amount of Registration Fee Units, each consisting of one share of common stock, without par value, and one warrant to purchase common stock, without par value (1)(3) $ 7,475,000 $ 962.78 Common stock, without par value, included in units (1)(3) (2) Warrants included in the units (1)(3) (2) Common stock, without par value, underlying the warrants included in the units (1)(3) 7,475,000 962.78 Total $ 14,950, 000 $ 1,925.56 (4) (1) Includes units that the underwriters have the option to purchase to cover over-allotments, if any. (2) No separate fee required pursuant to Rule 457(g) under the Securities Act. (3) Pursuant to Rule 416 under the Securities Act, there are also being registered such additional securities as may be issued to prevent dilution resulting from share splits, share dividends or similar transactions. (4) Calculated pursuant to Rule 457(o) under the Securities Act based on an estimate of the proposed maximum aggregate offering price, including the offering price of units that the underwriters have the option to purchase to cover over-allotments, if any. A total of $2,408.82 was previously paid. The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. To lead us to continued sales and profitable growth, we have a proven and experienced senior management team. Our Chief Executive Officer, Ken Barker, has been with us since 2006 and has significant experience in the apparel industry. Many of the other members of our senior management team have extensive experience in the textile industry and with leading consumer brands. Our Business Strategy We believe that our market presence and revenues will continue to expand with the continued development of our growers and customers, allowing the CRAiLAR brand to be recognized in a similar fashion to ingredient brand successes such as Gore-Tex and Tencel . We are pursuing the following growth strategies to continue to build our business: Further Develop Our Customer Ecosystem. We have established a strong set of relationships with other organizations in our customer ecosystem to deliver superior natural fibers to our customers. We believe these customers will enable us to increase the speed of deployment and functionality of our fibers and offer a wider range of applications to all our customers. We believe that the creation of these relationships is an important strategy and that additional development and supply agreements with consumer brands will also be important for the branding opportunities that these global brands will provide. Expand Penetration and Consumer Base. We intend to increase the number of consumers who buy our products by using the co-branding opportunities provided by our brand customers, as they communicate our sustainability and performance benefits to their consumers. We plan to support these opportunities with grassroots marketing, social media tools and industry advertising. We plan to continue to invest aggressively in our direct and indirect sales and marketing capabilities to continue to acquire new customers. Continue Innovation and Broaden Product Offering. Our customers' ability to deploy new products rapidly and cost-effectively will be central to our financial results. We intend to continue expanding the functionality of and applications for our products in the future. Expand Globally. We recognize that our patented technologies have global, multi-industry applications, and represent a significant opportunity for us. We plan to expand our sales capability internationally by expanding our sales force and by collaborating with strategic customers around the world. Stay True to Our Values. We are a focused business with long-standing core values. We continue to strive to operate in a socially responsible and environmentally sustainable manner. We believe the sustainability and performance of our products and solutions cultivates brand loyalty and trust with customers and helps attract consumers. We plan to work in tandem with our customers to communicate the benefits of CRAiLAR fibers through co-branding, ingredient call-outs, co-op marketing efforts and in-store signage. Invest in Infrastructure and Capabilities. We intend to continue to invest in our people, supply chain and systems to ensure that our business is scalable and profitable. We expect to add new employees to our sales, marketing, operations and finance teams as necessary to support our growth. Additionally, we plan to continue to invest in our systems and technology, to create a platform for growth and to increase efficiency. Production Plan We believe that one of the keys to the successful adoption of CRAiLAR fibers into the mainstream textile market is to scale up our in-house production capabilities. In December 2013, we acquired a European fiber dyeing facility with equipment similar to that used to produce CRAiLAR Flax fiber. The new plant allowed us to accelerate our timeline for establishing a company-controlled CRAiLAR enzyme processing capability. Production of CRAiLAR fibers at this facility commenced in January 2014. We believe the plant will have the capacity to produce over 280,000 pounds of CRAiLAR Flax fiber per week and the space to expand the capacity to over 800,000 pounds per week. Initially, we relied on a third party processor to perform one step of the CRAiLAR process, but we purchased the equipment to perform this step and during the second quarter of 2014 we installed this equipment and overhauled existing equipment so that we now perform this step internally. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JULY 31, 2014 CRAILAR TECHNOLOGIES INC. 12,037,037 Units We are offering to sell 12,037,037 units in this offering (each, a "Unit"), with each Unit consisting of one share of our common stock (each, a "Share") and one warrant (each, a "Warrant"). Each Warrant entitles the holder to purchase one share of our common stock (each, a "Warrant Share") at an exercise price of $0.54 (the market price of our common stock) per Warrant Share. The Warrants will expire on August___, 2019. The Shares and the Warrants are immediately separable and will be issued separately. No fractional Warrants will be issued. Our common stock is quoted on the OTC Markets Group Inc. s OTCQB tier and on the TSX Venture Exchange under the symbols "CRLRF" and "CL", respectively. On July 30, 2014, the last reported sale price of our common stock on the OTCQB was $0.54 per share, and the last reported sale price of our common stock on the TSX Venture Exchange was CAD$0.58 per share. In this prospectus, we assume that the public offering price per Unit is $0.54. Investing in our securities involves a high degree of risk. You should carefully consider the information in the section entitled "Risk Factors" beginning on page 7 of this prospectus before making a decision to purchase our securities. Per Unit Total Public offering price $ - $ - Underwriting discounts and commissions (1) $ - $ - Proceeds, before expenses, to us $ - $ - (1) See "Underwriting" beginning on page 46 for additional information regarding compensation payable to the underwriters by us. We have granted the underwriters a 30-day option to purchase up to (i) 1,805,555 additional Units, (ii) 1,805,555 additional Shares and/or (iii) additional Warrants to purchase up to 1,805,555 Warrant Shares from us to cover over-allotments, if any. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Delivery of the Units will be made on or about __ _, 2014. __________________ Sole Book-Running Manager Roth Capital Partners __________________ Co-Manager Wunderlich Securities The date of this prospectus is __, 2014 Raw Materials Flax is the principal raw material used in the manufacture of our natural fibers products. Flax is a cost-effective raw material for fiber production because it is easy to grow with minimal use of herbicides and generally requires only regular rainfall for irrigation, which significantly reduces costs as compared to other natural fibers. The European facility is located in an area of flax growing excellence and offers an abundant supply of feedstock from a by-product of the linen industry. Purchasing the by-product of the linen industry has significant working capital advantages because it is bought as needed and is processed, shipped and billed shortly after receipt. This compares with straw purchased directly from farmers for approximately the same cost, but for which a year's supply of straw must be paid when harvested by the farmer. We have developed relationships with various European flax processors and brokers to purchase cleaned feedstock. We have also purchased equipment to clean the feedstock for CRAiLAR processing that will allow us to buy partially cleaned fiber, providing access to additional sources of feedstock. We expect to have this equipment installed by the end of 2014. We plan to expand our agronomic focus to include multiple North American and international growing regions. We believe the expansion of our growing regions will mitigate climate risk associated with harvests. Sales and Marketing We are pursuing a pull-through marketing model, which focuses on working directly with some of the leading consumer brands in a variety of target markets, including apparel, textiles and industrial products, to develop additional products incorporating our CRAiLAR fibers. In this regard, we plan to leverage our partners' direct-to-consumer marketing programs to accelerate and expand the brand recognition for our proprietary fibers. Intellectual Property Under the CRAiLAR technology platform, we have secured the exclusive worldwide licensing rights to the patented intellectual property arising from our collaborative research agreements with the NRC. The NRC license covers our proprietary processes and includes a license to two patents covering the extraction of hemp fibers and preparation of bast fibers. The patents have been issued or allowed in the U.S., Canada, China, Europe and certain other jurisdictions, and are based on applications filed under the Patent Cooperation Treaty. The license expires upon the expiration of the last patent claim covered by the license, which is currently in December 2029, but may be terminated earlier by NRC upon our breach of the license agreement or in the event we become bankrupt or insolvent. We believe that our intellectual property has substantial value and has contributed significantly to the success of our business. Our primary trademark is CRAiLAR , which is registered with the U.S. Patent and Trademark Office, in Canada and in several other countries. We also rely on unpatented proprietary expertise, formulations, continuing innovation and other trade secrets, as well as common law trademarks and copyrights, to develop and maintain our competitive position. Corporate Information We were incorporated under the laws of British Columbia, Canada on October 6, 1998. Our principal executive offices are located at Suite 305, 4420 Chatterton Way, Victoria, British Columbia, Canada, V8X 5J2, and our telephone number is (250) 658-8582. Our corporate website is located at www.crailar.com. The information contained in, or that can be accessed through, our website does not constitute a part of this prospectus. The Offering Securities offered by us: 12,037,037 Units with each Unit consisting of one Share and one Warrant. The Shares and the Warrants are immediately separable and will be issued separately. No fractional Warrants will be issued. Offering price: The assumed public offering price is $0.54 per Unit. Common stock outstanding after the offering(1): 63,465,040 shares, including the 12,037,037 Shares included as part of the Units offered hereby. Terms of Warrants issued as a part of a Unit offered in the offering: Each Warrant is exercisable for one Warrant Share, subject to adjustment as described herein, and has an exercise price of $0.54 per Warrant Share which is equal to the market price of our common shares. Each Warrant will be immediately exercisable and will expire on August ___, 2019. See "Description of Securities" on page 48 for more information. Use of proceeds: We intend to use the net proceeds of the offering to expand our European wet processing facility, to purchase additional decortication equipment, to fund working capital and for other general corporate purposes. We may also use a portion of the net proceeds to redeem certain convertible debentures. See "Use of Proceeds". OTCQB symbol: CRLRF TSX Venture Exchange symbol: CL
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+PROSPECTUS SUMMARY The information in the following summary is described in more detail in this prospectus. This summary provides an overview of selected information and does not contain all of the information you should consider. You should read this entire prospectus carefully, including the risk factors, the financial statements and the notes thereto, and the other information included elsewhere in this prospectus, before making an investment decision. In this prospectus, unless the context otherwise requires, "Company," "Clarus," "we," "us" and "our" refer to Clarus Therapeutics, Inc. Overview We are an emerging specialty pharmaceutical company focused on men's health preparing for the commercial launch of REXTORO, our oral testosterone, or T, replacement therapy. REXTORO is the combination of T with a fatty acid to create testosterone undecanoate, or TU, an inactive version of T that is converted by the natural enzymes in the body to T, referred to as a T prodrug. On January 3, 2014, we submitted our New Drug Application, or NDA, for REXTORO to the U.S. Food and Drug Administration, or FDA. REXTORO is an oral T prodrug that, if approved by the FDA, will be used to treat men diagnosed with testosterone deficiency together with an associated medical condition, also known as hypogonadism. In each of our two Phase 3 trials, REXTORO met its primary endpoint of restoring testosterone to normal levels in at least 75% of subjects. We own the worldwide, royalty-free commercialization rights for REXTORO. Clarus was founded with the objective of successfully creating, developing and commercializing an oral T-replacement therapy to expand patient choice in a market currently dominated by non-oral options. Our founder, President and Chief Executive Officer, Dr. Robert E. Dudley, led the discovery, development, regulatory approval and launch of AndroGel, the first gel formulation of T, which remains the leading T-replacement therapy more than a decade after its launch. We believe that current users of T-replacement therapies desire an oral T option that is safe, effective and more convenient than currently available options. Therefore, our goal is for REXTORO to become the preferred choice for T-replacement therapy in hypogonadal men. Almost 20 million men in the United States between the ages of 45 and 75 years old may have deficient levels of testosterone, defined as T levels below 300 nanograms per deciliter, or ng/dL, based upon prevalence rates published in 2006. Common symptoms of T deficiency include reduced sexual activity and desire, decreased energy, increased body fat and reduced muscle mass, depressed mood and other emotional and physiological issues. T deficiency can be diagnosed with a simple blood test. Nevertheless, only 12% of men with T deficiency actually receive T-replacement therapy, according to a study published in 2008. Even with this low treatment rate, U.S. sales of T-replacement therapies, the standard treatment for T deficiency, grew at an average annual rate of 21% from 2010 through 2013 and exceeded $2.3 billion in 2013. T-gels were 89% of these sales. We believe a large number of men with T deficiency remain untreated or do not adhere to their T-replacement therapy because of dissatisfaction with currently available T-replacement therapies. For example, only 31% and 14% of men continued taking T-gels six and twelve months, respectively, after commencing therapy, according to a peer-reviewed study of more than 15,000 men with T deficiency. We believe these low adherence rates result from inconvenient application and safety concerns about T-gels. In addition, T-gels carry a "black box warning" because of their risk of unsafe transference of T to children. FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents We believe REXTORO, if approved, will offer hypogonadal men and prescribing physicians a safe and effective oral T-replacement option and will have a number of advantages over the currently approved T-replacement therapies, including: Convenient Oral Dosing. REXTORO is one or two easy-to-swallow softgel capsules taken twice daily with a meal. We believe oral dosing will be easier to use than T-replacement therapies currently on the market and will improve the low treatment adherence rates caused by the inconvenience of, and potential adverse skin reactions associated with, T-gels. No Inadvertent T Exposure. REXTORO is an oral product that eliminates the risk of T transfer to women and children which can lead to serious consequences. This potential transfer is a risk associated with all T-gels and has led to a "black box" warning on all of these products' labels because of the resulting risk to children. Normalized T Levels. After appropriate dose adjustment, 84% and 75% of men treated with REXTORO in our Phase 3A and 3B trials, respectively, achieved average serum T concentrations in the normal range of 300 to 1,000 ng/dL. Safe Pharmacokinetic Profile. With the dosing regimen proposed in our NDA for the REXTORO label, serum T concentrations were normalized in 75% of men participating in our Phase 3B trial and were closely aligned with, but did not precisely meet, the FDA's safety target of 2,500 ng/dL for peak T concentrations. We observed peak T concentrations in excess of this safety target in 3% of men treated with REXTORO, although these observations were infrequent and transient, and the detection of one high peak in a patient was not an indicator that a similar event would be detected at a later clinical visit by the same patient. REXTORO's overall safety profile, including peak serum T concentrations, was generally consistent with that observed in clinical trials of other FDA approved T-replacement therapies. We intend to build a specialty sales force of approximately 150 to 200 sales representatives to promote REXTORO, if approved, in the United States. We believe we can achieve a successful launch by targeting endocrinologists and urologists, as well as high-prescribers of T-replacement therapies in family practice and internal medicine, commonly referred to as primary care physicians, or PCPs. Our new Chief Commercial Officer, Patrick M. Shea, has directed U.S. sales and marketing and other commercial operations for global pharmaceutical companies and led teams developing commercial pre-launch and launch plans for urologic products such as Flomax . The FDA notified us in March 2014 that it had accepted our NDA for review and assigned us a November 3, 2014 Prescription Drug User Fee Act, or PDUFA, date which is the goal date for the FDA to complete its review of our NDA. Prior to the PDUFA date, the FDA will hold an advisory committee meeting to review and evaluate our NDA, which we expect to be scheduled for September 2014. While the NDA is pending, and at the request of the FDA, we have completed our Phase 4 12-month safety extension of our Phase 3A trial. This continuation trial was a means to collect additional safety data in subjects who successfully completed our Phase 3A trial, including data regarding comparative exposure to Androgel 1%. We did not have to complete this trial as a condition to the FDA approving our NDA for REXTORO. We submitted the results of this trial as a safety update to the FDA in May 2014. Our Strategy Our goal is to build a specialty pharmaceutical company that commercializes products focused on men's health. Key elements of our strategy to achieve this goal include: Obtain U.S. regulatory approval for REXTORO. In March 2014, the FDA notified us that it had accepted our NDA for review of REXTORO as a therapy for the treatment of hypogonadal CLARUS THERAPEUTICS, INC. (Exact Name of Registrant as Specified in Its Charter) Table of Contents men and assigned it a November 3, 2014 PDUFA date. We will pursue the approval of this application. Build a commercial infrastructure to successfully launch REXTORO. We will begin building a commercial infrastructure to support our specialty sales force that, if REXTORO is approved, will target endocrinologists, urologists and PCPs who are high-prescribers of T-replacement therapies. Establish REXTORO as the preferred choice for T-replacement. We will drive awareness of REXTORO, if approved, by leveraging the convenience of REXTORO's oral administration without inadvertent T transference to women and children. Following its commercial launch, we will seek to establish REXTORO as the preferred T-replacement option for physicians and hypogonadal men. Explore partnerships to more broadly commercialize REXTORO. Following the commercial launch of REXTORO, if approved, we expect to explore marketing or co-promotion arrangements with established pharmaceutical companies that have PCP-focused sales forces in the United States. We also expect to consider strategic partners with demonstrated commercial capabilities outside the United States. Build a portfolio of men's health products. We have two issued U.S. patents covering REXTORO that claim both pharmaceutical composition and methods of treatment and expire in December 2028 and September 2030, respectively. We will seek to leverage the commercial launch of REXTORO, if approved, with Dr. Dudley's and the rest of our management team's expertise in men's health to develop or acquire rights to additional complementary men's health products. Risks Affecting Us
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+PROSPECTUS SUMMARY This summary highlights information contained in other parts of this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in shares of our common stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere or incorporated by reference into this prospectus. You should read the entire prospectus and the information incorporated herein carefully, especially Risk Factors and our consolidated financial statements and the related notes incorporated by reference into this prospectus, before deciding to buy shares of our common stock. Unless the context requires otherwise, references in this prospectus to Celladon, we, us and our refer to Celladon Corporation. Overview We are a clinical-stage biotechnology company applying our leadership position in the field of gene therapy and calcium dysregulation to develop novel therapies for diseases with tremendous unmet medical needs. Our lead programs target sarco/endoplasmic reticulum Ca2 -ATPase, or SERCA, enzymes, which are a family of enzymes that play an integral part in the regulation of intra-cellular calcium in all human cells. Calcium dysregulation is implicated in a number of important and complex medical conditions and diseases, such as heart failure, which is a clinical syndrome characterized by poor heart function resulting in inadequate blood flow to meet the body s metabolic needs, as well as blood vessel health, diabetes and neurodegenerative diseases. SERCA2a, an enzyme that becomes deficient in patients with heart failure, was scientifically validated as a molecular target for heart failure in the 1990s and became a focus of internal discovery efforts for many large pharmaceutical companies. However, to date, no other company has been successful in targeting SERCA2a using traditional discovery methods. Our therapeutic portfolio includes both gene therapies and small molecule compounds targeting diseases characterized by SERCA enzyme deficiency. MYDICAR, our most advanced product candidate, uses gene therapy to target SERCA2a. We believe that our gene therapy approach to modulating SERCA2a overcomes the issues encountered by previous efforts and has the potential to provide transformative disease-modifying effects with long-term benefits in patients with heart failure. In addition, we have recently in-licensed worldwide rights to patents covering an additional gene therapy product opportunity, the membrane-bound form of Stem Cell Factor, or mSCF, for the treatment of cardiac ischemic damage. We have also identified a number of potential first-in-class compounds addressing novel targets in diabetes and neurodegenerative diseases with our small molecule platform of SERCA2b modulators. We are the first company to enter clinical development with a product candidate, MYDICAR, that selectively targets SERCA2a. We refer to our Phase 1 trial and Phase 2a trial of MYDICAR together as our CUPID 1 trial. In Phase 2a of our CUPID 1 trial, 39 patients with systolic heart failure, which is caused by the inability of the heart to pump blood efficiently due to weakening and enlargement of the ventricles, were enrolled in a randomized, double-blind, placebo-controlled trial. MYDICAR was safe and well-tolerated, reduced heart failure-related hospitalizations, improved patients symptoms, quality of life and serum biomarkers and improved key markers of cardiac function predictive of survival, such as end systolic volume. Based on these results, as well as our previous preclinical studies and clinical trials, we advanced MYDICAR to a 250-patient randomized, double-blind, placebo-controlled international Phase 2b trial in patients with systolic heart failure, which we refer to as CUPID 2. We completed enrollment of CUPID 2 in February 2014 and expect to announce results in April 2015. If successful, these results, along with other studies, will form the basis for regulatory submissions for approval with the United States Food and Drug Administration, or FDA, and European Medicines Agency, or EMA. In 2012, we obtained a Special Protocol Assessment, or SPA, whereby the FDA agreed to use time-to-multiple heart failure-related hospitalizations as the primary endpoint for a MYDICAR Phase 3 pivotal trial. Our ongoing CUPID 2 trial uses a similar clinical protocol with identical endpoints as agreed to in the SPA. In Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. Preliminary Prospectus SUBJECT TO COMPLETION, DATED AUGUST 7, 2014 4,000,000 Shares Common Stock We are offering 4,000,000 shares of our common stock. Our common stock is listed on The NASDAQ Global Market under the symbol CLDN. The closing price of our common stock on The NASDAQ Global Market on August 6, 2014, was $10.54 per share. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012 and, as such, have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. The underwriters have a thirty-day option to purchase a maximum of 600,000 additional shares of our common stock. Investing in our common stock involves risks. See Risk Factors beginning on page 12 of this prospectus. Price to Public Underwriting Discounts and Commissions(1) Proceeds to Us, Before Expenses Per Share $ $ $ Total $ $ $ (1) We have agreed to reimburse the underwriters for certain FINRA-related expenses. See Underwriting. Delivery of the shares of common stock will be made on or about , 2014. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed on the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Joint Book-Running Managers Credit Suisse Jefferies Co-Managers Stifel Wedbush PacGrow Life Sciences The date of this prospectus is , 2014 Table of Contents November 2013, the EMA indicated that if MYDICAR demonstrates a substantial and highly significant treatment effect in the advanced heart failure population, and no untoward effects attributable to MYDICAR are observed, a safety database of approximately 205 to 230 MYDICAR-treated subjects may be sufficient for a safety assessment to allow for acceptance of a Marketing Authorization Application, or MAA, for MYDICAR for the treatment of systolic heart failure. We therefore believe that, if the above conditions are met, a Phase 3 trial may not be required for marketing approval in Europe. In April 2014, the FDA s Center for Biologics Evaluation and Research, or CBER, granted Breakthrough Therapy designation to MYDICAR for reducing hospitalizations for heart failure in patients who test negative for adeno-associated viral vector 1, or AAV1, neutralizing antibodies, are class III or IV heart failure patients under the New York Heart Association, or NYHA, classification system, and are not in immediate need of a left-ventricular assist device, or LVAD, or heart transplant. The Breakthrough Therapy program is intended to expedite drug development and review of innovative new drugs that are intended to treat serious or life-threatening diseases and for which preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on a clinically significant endpoint. MYDICAR was the third product candidate to receive this designation from CBER, and the designation indicates that the FDA has determined that the CUPID 1 trial provided preliminary clinical evidence that MYDICAR may demonstrate substantial improvement over available therapies in heart failure patients for which the designation was granted. We are initially developing MYDICAR to treat patients with systolic heart failure. We are also developing MYDICAR for additional indications, including arteriovenous fistula, or AVF, maturation failure, and for the treatment of patients with advanced heart failure who are on an LVAD. In addition, we expect to initiate a clinical trial in 2015 for the treatment of diastolic heart failure, a condition caused by the inability of the heart to relax normally between contractions, if data from our preclinical research warrants. Table of Contents TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary provides an overview of selected information contained elsewhere or incorporated by reference in this prospectus and does not contain all of the information you should consider before investing in our common stock. You should carefully read this prospectus and the registration statement of which this prospectus is a part in their entirety before investing in our common stock, including the information discussed under Risk Factors beginning on page 10 and our financial statements and notes thereto that appear elsewhere or are incorporated by reference in this prospectus. As used in this prospectus, the terms we, our, us, or the Company refer to Regado Biosciences, Inc. Our Company We are a biopharmaceutical company focused on the discovery and development of novel, first-in-class, actively controllable antithrombotic drug systems for acute and sub-acute cardiovascular indications. We are pioneering the discovery and development of two-component drug systems consisting of a therapeutic aptamer and its specific active control agent. Our actively controllable product candidates have the potential to improve outcomes, enhance the patient experience and reduce overall treatment costs. Our Lead Product Candidate REG1 is an actively controllable anticoagulant targeting coagulation Factor IXa for use in patients with a wide variety of acute coronary syndromes, or ACS, undergoing a percutaneous coronary intervention, or PCI, a hospital-based procedure used to mechanically open or widen obstructed coronary arteries. REG1 consists of pegnivacogin, an anticoagulant aptamer, and its specific active control agent, anivamersen. Pegnivacogin achieves its maximal anticoagulant effect within five minutes of injection. Anivamersen is an oligonucleotide, a biological polymer consisting of a relatively small number of nucleotides chemically bound in a linear sequence that forms a chain-like structure, or strand, and has no pharmacologic activity other than to bind to pegnivacogin. Anivamersen rapidly and precisely reduces or eliminates the anticoagulant activity of pegnivacogin. Both pegnivacogin and anivamersen are administered by intravenous bolus injection using weight-based dosing. By adjusting the dose of anivamersen relative to pegnivacogin, the anticoagulant effect of pegnivacogin can be precisely and rapidly controlled or eliminated. The unprecedented level of control that REG1 provides may permit physicians to achieve levels of anticoagulation in patients that would be unsafe to use with existing anticoagulants. PCI procedures involve a significant risk of ischemic events, including death, stroke, myocardial infarction and the need for revascularization of the artery. Because of this risk, powerful anticoagulant drugs are administered prior to and throughout the PCI procedure. However, anticoagulants create a significant risk of major bleeding events. As a result, interventional cardiologists are forced to make a compromising medical decision because they lack the means to simultaneously reduce the risks of ischemic and major bleeding events. REG1 is the first and only anticoagulant to demonstrate a reduction in both ischemic and major bleeding events in a clinical trial for PCI. In our randomized, partially blinded, dose-ranging Phase 2b trial involving 640 subjects, or the RADAR trial, when compared to standard of care heparin, REG1 demonstrated both a rapid and predictable anticoagulant effect and the ability to precisely modulate or eliminate that effect in real time. REG1 also demonstrated the following important clinical and pharmacoeconomic benefits: an approximate 66.0% reduction in ischemic events; a reduction of up to 60.0% in major bleeding events; a substantial reduction in time from catheterization to catheter sheath removal from a median of 3.8 hours to a median of one hour; a substantial reduction in time from completion of the PCI procedure to catheter sheath removal from a median of three hours to a median of 24 minutes; and Table of Contents a substantial reduction in the time subjects were required to remain still following catheter sheath removal from a median of 5.7 hours to a median of 2.8 hours. Based on these clinical results and after discussion with the U.S. Food and Drug Administration, or FDA, and the European Medicines Agency, we initiated a single, open-label, 13,200 subject Phase 3 trial of REG1, or the REGULATE-PCI trial, in September 2013. REGULATE-PCI, if successful, will serve as the basis for product registration applications worldwide. In March 2014, we announced that REG1 received Fast Track designation from the U.S. Food and Drug Administration, or FDA, for anticoagulant therapy to be used in patients with coronary artery disease during PCI. We believe that REG1 has the potential to become the standard of care for anticoagulation therapy in PCI and other cardiovascular procedures because it is designed to give physicians precise, on-demand control over anticoagulation levels. We believe the key potential advantages of REG1 over existing therapies are the following: Reduced ischemic events. REG1 allows a higher level of anticoagulation to be used during PCI, which may reduce the occurrence of ischemic events. Reduced major bleeding events. REG1 s anticoagulant effect can be modulated or eliminated at the end of PCI which may reduce the risk of major bleeding events. Precise and predictable dosing. Because REG1 s effect is independent of an individual patient s metabolism or health, dosing is precise and predictable, potentially eliminating the need for time consuming and costly patient monitoring during and after PCI. Broad applicability. REG1 s use in PCI is likely to be unrestricted for high risk patients such as those with kidney or liver impairment. Pharmacoeconomic benefits. We believe that REG1 may reduce overall treatment costs by reducing ischemic and major bleeding events, shortening procedure and recovery times, reducing the need for procedure-related follow-up interventions and re-hospitalizations, increasing staff and facility efficiency and improving the patient experience. We believe that REG1 has potential for use in other PCI and interventional cardiovascular procedures, such as open heart surgery, PCI as a treatment for ST segment elevation myocardial infarction as well as transcatheter aortic valve replacement or implantation. PCI Overview PCIs are hospital-based procedures used to mechanically open or widen obstructed coronary arteries. Based on statistics published by the American Heart Association in 2013, we estimate that approximately 770,000 PCIs were performed in the United States in 2013. We estimate that in 2013 approximately 540,000 PCIs, excluding ST Elevation Myocardial Infraction, or STEMI, patients but including Non-ST Elevation Myocardial Infraction, or n-STEMI, acute coronary syndrome patients and elective PCI for coronary arterial disease, were performed in Europe and at least 1.2 million PCIs were performed in the rest of the world. Based upon the estimated cost per procedure of branded anticoagulants, we believe that this represents a greater than $3.0 billion annual market opportunity for anticoagulants used in PCI procedures. We believe that an antithrombotic treatment that can address the shortcomings of existing anticoagulants would establish a new standard of care. Our Proprietary Technology Platform Our aptamers are single strands of nucleic acids, or oligonucleotides, that are chemically synthesized. Unlike other oligonucleotides, which are designed to control gene expression, an aptamer has a unique geometric shape that binds specifically and tightly to a target protein molecule, leading to inhibition of the target s activity. Aptamers have been discovered that interact with essentially every class of therapeutic protein target. An aptamer s pharmacologic activity can be controlled by interaction with a complementary oligonucleotide, which we term a specific active control agent. When the specific active control agent binds to the aptamer, it Table of Contents For investors outside the United States: neither we nor the underwriters have done anything that would permit this offering or possession or distribution of this prospectus or any free writing prospectus we may provide to you in connection with this offering in any jurisdiction where action for that purpose is required, other than in the United States. You are required to inform yourselves about and to observe any restrictions relating to this offering and the distribution of this prospectus and any such free writing prospectus outside of the United States. TABLE OF CONTENTS PAGE Prospectus Summary 1
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+Prospectus summary 1
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+PROSPECTUS SUMMARY This summary highlights selected information contained in this prospectus and may not contain all of the information that you need to consider in making your investment decision. To understand this offering fully, you should carefully read this summary together with the more detailed information contained in this prospectus. You should carefully consider the section titled Risk Factors in this prospectus and our consolidated financial statements. Unless we state otherwise or the context otherwise requires, references in this prospectus to Square 1, we, our, and us refer to Square 1 Financial, Inc., a Delaware corporation, and its consolidated subsidiaries. References in this prospectus to the Bank means Square 1 Bank, the wholly-owned banking subsidiary of Square 1 Financial. Overview About us. We are a financial services company headquartered in the greater Research Triangle Park area of North Carolina and became the bank holding company for Square 1 Bank, a de novo North Carolina commercial bank, in August 2005 upon the commencement of Square 1 Bank s operations. Through Square 1 Bank, which was formed by experienced venture bankers, commercial bankers and entrepreneurs, we focus our banking activities almost exclusively on venture capital firms and private equity firms (which we collectively refer to as venture firms ) and the portfolio companies funded by such firms. Square 1 Bank provides a broad range of financial services nationwide to these investors and their portfolio companies, including, among others, term commercial loans, revolving lines of credit, asset-based loans, deposit products and fee-based banking services, including credit cards, foreign exchange, cash management and letters of credit. We refer to the market in which we operate as the venture banking market and our bankers as venture bankers. Among entrepreneurial companies, our primary focus is on venture-backed technology and life sciences companies, nationwide. Our strong relationships and extensive experience in the entrepreneurial community have allowed us to follow these and other companies across their stages of development, resulting in a diversified borrower and depositor customer base. We marked our eight year anniversary in August 2013 and, shortly thereafter, exceeded $1.0 billion in loans outstanding. As of December 31, 2013, we had total assets of $2.3 billion, total loans outstanding of $1.1 billion, total deposits of $2.1 billion, and shareholders equity of $189.1 million. Venture firms are a key referral source for new entrepreneurial company relationships for Square 1 Bank. However, we have no arrangements or understandings with any venture firm relating to lending money to their portfolio companies. We target our business development and marketing strategy primarily on entrepreneurs, venture-backed entrepreneurial companies and venture firms. The terms of the credit facilities we provide to our clients vary by type of loan product, loan size and growth stage of the client and underlying collateral. We provide commercial term loans and lines of credit to venture-backed companies primarily in the technology and life sciences sectors, with loan terms of between 12 and 48 months. These loans are typically made to companies in all stages of a typical start-up company s lifecycle. Loans originated by our asset-based lending group are typically structured as revolving lines of credit and advances are based on a formula tied to accounts receivable or other assets of the borrowers. Our asset-based loans are typically made to expansion and late stage companies. The primary source of repayment for asset-based loans is typically operating cash flow of the client. We also provide real estate secured, government-guaranteed loans through the Small Business Administration ( SBA ) and U.S. Department of Agriculture ( USDA ) programs, with maturities of 20 years or more, and construction loans, which convert into real estate SBA and USDA loans upon completion of construction, the terms of which are generally 12 months or less. In certain cases, we sell the guaranteed portion of SBA loans originated by us on the secondary SBA market, which serves to reduce the amount of our outstanding loan balances and results in a gain on sale as well as fee income for us. We provide senior debt facilities to our borrowers that are secured by substantially all of the assets of the borrower client. In some instances, we also obtain the guarantee of the venture firm that provided venture capital to our borrower client or, in the case of a borrower that has not received venture capital funding, a guarantee of individuals associated with the borrower. For early stage companies, the primary source of repayment is typically cash collateral held in accounts with us. At December 31, 2013, with the exception of several credit card loans, all of the loans in our portfolio were secured loans. In connection with the negotiation of credit facilities with our portfolio company borrowers, we often receive warrants to acquire stock of the borrower, primarily those that are privately-held, venture-backed companies in the life sciences and technology industries, but do not otherwise make equity investments in our portfolio company clients. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MARCH 14, 2014 Preliminary PROSPECTUS 5,881,126 Shares Common Stock This prospectus relates to the initial public offering of Square 1 Financial s Class A common stock. We are offering 3,125,000 shares of our Class A common stock. The selling shareholders identified in this prospectus are offering 2,306,126 shares of our Class A common stock and 450,000 shares of our Class B common stock, which will convert into 450,000 shares of Class A common stock upon sale in this offering. We will not receive any proceeds from sales by the selling shareholders. References in this prospectus to common stock refer to Square 1 Financial s Class A common stock unless we state otherwise or the context otherwise requires. Prior to this offering, there has been no established public market for our common stock. We currently estimate the public offering price per share of our common stock will be between $15.00 and $17.00. We have applied to have our common stock listed on the Nasdaq Global Market under the symbol SQBK. We are an emerging growth company under the federal securities laws and will be subject to reduced public company reporting requirements. See Risk Factors, beginning on page 14, for a discussion of certain risks that you should consider before making an investment decision to purchase our common stock. Per Share Total Initial public offering price $ $ Underwriting discounts(1) Proceeds to us before expenses Proceeds to selling shareholders, before expenses (1) See Underwriting for additional information regarding the underwriting discount and certain expenses payable to the underwriters by us. The underwriters have an option to purchase up to an additional 882,167 shares of our common stock at the initial public offering price less the underwriting discount, within 30 days from the date of this prospectus. Of the 882,167 shares subject to the underwriters option, 468,750 shares will be offered by us and 413,417 shares will be offered by the selling shareholders (67,500 of which are shares of our Class B common stock that convert into 67,500 shares of our Class A common stock upon sale in this offering). Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The shares of our common stock that you purchase in this offering will not be savings accounts, deposits or other obligations of any of our bank or non-bank subsidiaries and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. The underwriters expect to deliver the shares to purchasers on or about [ ], 2014, subject to customary closing conditions. SANDLER O NEILL + PARTNERS, L.P. Prospectus dated [ ], 2014 Table of Contents Our market. According to the PricewaterhouseCoopers/National Venture Capital Association MoneyTree Report ( MoneyTree Report ), in 2013 venture capital investment in the U.S. totaled approximately $29.4 billion invested across 3,995 venture investment rounds. In the past four years, in a given quarter, based on the MoneyTree Report, there are generally as few as approximately 675 and as many as approximately 1,075 venture investment rounds completed, totaling between $5.0 billion to $8.0 billion across the U.S. While approximately one-third of these investments will be first-time financings for companies, overall these investments span the life stages of a company from angel/seed to late stage of the company, at which point the venture capital backer typically exits its investment through an acquisition or the sale of its investment in connection with an initial public offering of the company. This cycle of venture investment and company maturation results in these companies needing tailored venture banking products and services for many years. This market and the short-term nature of our loan facilities provide a steady flow of banking needs, since we work very closely with both the entrepreneurial company and its venture firm investors to provide debt financing and cash management solutions for each stage of the company s growth. Balance Sheet Strength Banking the venture capital community provides a steady stream of funding, including low-cost deposits. In addition, venture-backed companies, as well as venture firms, typically have large fluctuations in cash flow. We have developed a mix of on- and off-balance sheet client funds and cash management products to accommodate their financial needs, while prudently managing our capital. Venture-backed companies tend to receive large cash infusions from each round of equity financing, which they must hold in a liquid vehicle that allows them to access funds for operating purposes as they implement their business models. As a result, many of our customers hold large cash balances in deposit accounts and off-balance sheet cash management products with us. At December 31, 2013, 65.6% of our client funds came from our borrower clients. Client funds consist of on-balance sheet deposits and off-balance sheet client investment funds. Venture firms also often have excess cash after a capital call or sale of a portfolio company, and require access to a short-term, liquid investment vehicle for these funds. These firms need liquidity for these funds as well as desire to earn a yield, so they often utilize a combination of demand deposits, money market accounts and certain other short-term, highly liquid products we offer. Our average cost of deposits for the year ended December 31, 2013 was 0.04% on an average balance of deposits of $1.9 billion. These low-cost deposits are our primary source of funding and provide us with a significant competitive advantage. They also provide us with more than sufficient funds to satisfy the lending needs of our clients. This funding leverage can be seen in our relatively low loan-to-deposit ratio, which was 49.1% for the year ended December 31, 2013 as well as off-balance sheet deposits, which were $557.9 million at December 31, 2013. In addition to our funding advantages from our low-cost deposits, 92.7% of our loan portfolio is comprised of floating-rate loans, which provides us with automatic re-pricing of those loans as the interest rate environment changes. A Specialized Market Demands Specialized Capabilities Lending to a venture-backed company, particularly in the early and expansion stages of its corporate life cycle, presents challenges to a typical commercial bank lender. For example, early stage clients are in the process of developing their products and often lack revenue and operating cash flow. Expansion stage clients have begun to commercialize their products and generate revenue, but may not have achieved profitability. At December 31, 2013, 13.4% of our loans outstanding were represented by loans to early stage companies, 54.3% to expansion stage companies, and 13.2% to late stage companies. The remainder of our loan portfolio at that date was comprised of loans to venture firms, credit cards and SBA/USDA loans. Lending to companies without revenue or established products requires frequent monitoring as well as knowledgeable and experienced venture bankers who can assist our borrowers. Managing these risks, therefore, requires specialized expertise and controls that cannot be acquired with a simple addition to staff. Our controls include, among other things, the review of monthly financial statements and close monitoring of non-traditional measures such as investor reserves, the company s cash burn rate, and its performance against non-financial business metrics and milestones. We perform frequent company updates with management and engage venture firms quarterly or more frequently on each portfolio company s performance and its next anticipated equity event. Our team of experienced bankers and risk managers who are knowledgeable about the industry, and our organizational structure, are dedicated to evaluating and monitoring entrepreneurial companies and their venture capital backers. As a result, we believe the controls and procedures we have in place have enabled us to manage this risk effectively. Table of Contents We believe that entrepreneurial companies and venture firms welcome choice when selecting a banking partner. Despite the attractiveness of this market, the need for experienced bankers who specialize in lending to venture-backed companies has limited the number of financial institutions and specialty lending companies serving this market. From inception, we have believed there is a significant market opportunity for a high-quality and nimble alternative to Silicon Valley Bank, the only other commercial bank that focuses primarily on, and has the largest share of, the venture banking market on which we focus. Given the industry in which we operate, we believe this market is generally underserved and, therefore, it provides us with an opportunity to continue our strong growth and profitability. While there are other banks that will provide deposit and lending services to entrepreneurial companies, most of these banks do not specialize in lending and deposit/cash services tailored to the specific needs of these types of entrepreneurial companies. There are also specialty venture debt funds that provide loans to such companies, but do not accept deposits or provide other traditional fee-based banking services to such companies. We are still a young company, having only been in existence since August 2005, but believe that we have penetrated the venture banking market in all of the key entrepreneurial hubs in the United States. We have continued to add venture bankers and client managers in key markets, particularly during the last three years, adding over 15 bankers and client managers in Silicon Valley, Boston, New York and the West Coast. These key hires have allowed us to further penetrate markets in which we believe there is significant opportunity for us to grow, and they complement our consistently strong presence in other markets such as the mid-Atlantic, Southeast, Texas and Colorado. We, therefore, believe that our position as the only other pure play commercial bank serving the venture banking market provides substantial opportunity for us to continue our successful growth. Our History and Growth Square 1 Bank was founded in 2005 by a group of venture and commercial bankers, led by Richard Casey and Susan Casey. The founding team collectively had many decades of experience in banking entrepreneurial companies and venture firms. Since inception, Square 1 Bank has experienced significant success across the following areas: Capital-Raising: August 2005 Chartered with an initial capitalization of $105.0 million raised through a private placement of common stock to the management team and Board of Directors of Square 1 Bank, members of the venture community and institutional investors. September and December 2008 $7.4 million raised through a private placement of trust preferred securities to members of management, the Board of Directors and other existing shareholders and an additional $5.0 million raised through a private placement of preferred stock to a private equity fund. May 2010 $48.5 million raised through a private placement of common stock primarily to institutional investors to support growth and bolster capital. October December 2012 $23.2 million raised through a private placement of common stock to continue Square 1 Bank s focus on organic growth and it strategic initiatives. Table of Contents Net Income and Net Operating Income(1) As shown in the chart below, our net operating income has grown steadily, particularly in the last three years. We incurred a loss in 2010 resulting from the sale and impairment of non-agency mortgage-backed securities held in our investment portfolio. (1) Net Operating Income is a non-GAAP financial measure. See Selected Historical Consolidated Financial Information Non-GAAP Financial Measures. Deposit Growth We exceeded approximately $1.0 billion in deposits at Square 1 Bank in July 2008, (amounting to $1.1 billion as of July 31, 2008), solely through organic growth. Low-cost deposits have been, and we expect will continue to be, our primary source of funding. 65.5% of our deposits were held in noninterest-bearing demand deposit accounts as of December 31, 2013. Our average cost of deposits for the year ended December 31, 2013 was 0.04%. This deposit mix may shift over time as interest rates move up or down. Table of Contents Loan Growth The chart below sets forth the average balance of loans outstanding for each period presented. At December 31, 2013 we had $1.1 billion in loans outstanding, with $977.3 million in outstanding unfunded loan commitments. (1) Net of unearned income. Our Strengths We believe that we are well-positioned to create value for our shareholders, particularly as a result of the following strengths: Experienced and knowledgeable entrepreneurs serving entrepreneurs Our banking team and culture. Square 1 Bank was founded by a group of venture bankers, with collectively, decades of experience in lending to entrepreneurial companies and venture firms. From the outset, we sought to operate in a manner different from larger banks, and recruited experienced bankers who are driven by an entrepreneur s motivation to serve our market in a manner that is quick and responsive, flexible, accessible and provides high touch, personalized service. These founding goals, coupled with a very strong credit culture, have resulted today in a team of over 60 venture bankers and client managers with extensive relationships throughout the entrepreneurial and venture capital community and dedicated to the industry we serve. Our executive management team. Douglas H. Bowers, President and Chief Executive Officer, has more than 30 years of commercial banking experience. Judith Erwin, our Executive Vice President, Venture Capital Services and Global Treasury Management, and Christopher Woolley, our Executive Vice President, Banking West, are both founders of Square 1 Bank. Sam Bhaumik is our Executive Vice President, Banking Silicon Valley. Each of these three executive officers has an average of more than 25 years of experience working with entrepreneurs and the venture capital community. Ms. Erwin and Mr. Woolley previously worked together in venture banking at the former Imperial Bank and its successor, Comerica Bank. Mr. Bhaumik brings decades of experience in our market having served in a senior position at a specialty finance company focused on venture-backed technology companies and prior to that in senior positions at Imperial Bank, its successor Comerica Bank, and Silicon Valley Bank. Our Chief Credit Officer, Diane Earle, has more than 27 years of experience in commercial lending and risk management. Ms. Earle spent several years at a venture debt fund, as well as at GE Commercial Finance where she served in senior leadership roles in the credit risk management area, focused on the technology and life sciences industries. Table of Contents Our Board of Directors. Our Board of Directors includes former venture bankers and commercial bankers, representatives of private equity funds and venture capital firms, and a former banking regulator. Several of our founders who serve on our Board of Directors previously worked together in various high-level executive positions at Imperial Bank, and collectively bring decades of experience in lending to the entrepreneurial and venture capital community and in senior management and/or Boards of Directors roles in this market. Our relationships. A key component of our strategy is to leverage our strong relationships with venture and private equity firms that invest in, and support, our borrowing clients. From these relationships we gain deep insight into the operations and performance of our clients. These venture firms provide experienced institutional oversight over the portfolio companies to which we lend and are a significant driver in our decision to provide banking services to those companies. The ongoing support provided by these firms to the portfolio companies is also a significant factor in our underwriting decisions with respect to our borrowing clients. Risk Management Loan portfolio. We understand the risk profile of entrepreneurial companies and have many years of experience lending to the entrepreneurial and venture capital communities. Credit quality is very important to our business and is a key focus of Square 1 Bank. We have four risk managers and a team of portfolio analysts dedicated to evaluating and continually monitoring our borrowers financial and operational progress, which positions us to act quickly and proactively manage our exposure to our borrowers. Our bankers and client managers actively partner with our risk management personnel to manage credit issues which may arise in our loan portfolio. Our lending activities are diversified nationwide over a variety of industry sectors (with a focus on technology and life sciences) and with companies in different stages of development. We have developed an extensive credit risk management system which provides for, among other things, frequent contact with our borrowers and we are in the process of upgrading our credit process capabilities to create additional efficiencies for more scalable risk management practices as we grow. As a result of this credit focus, we have maintained a track record of sound credit quality from inception. Our highest annual rate of net loan charge-offs to average loans over the past five years, 2009 through 2013, was 1.94%. At December 31, 2013, our ratio of nonperforming loans to total loans was 1.34%. Our 2013 net loan charge-offs were 0.95% of average outstanding loans. Investment portfolio. As a result of the significant low-cost deposits generated by this business model, we have funds in excess of those we lend to our borrowing clients. As a result, we maintain a significant securities portfolio, which totaled $1.1 billion as of December 31, 2013. This securities portfolio provides us with additional sources of income and liquidity. Our investment portfolio is managed by a team of highly-experienced officers and employees. Prior to 2009, management of our investment portfolio was outsourced to a third-party investment firm. At that time, our investment securities portfolio was highly concentrated in non-agency mortgage-backed securities which at the time of purchase were investment grade securities. Following the financial crisis in 2008, a majority of these securities were downgraded to noninvestment grade securities. We incurred significant losses in 2008, 2010 and 2011 on our investment portfolio due primarily to our investment in these pre-2008 non-agency mortgage-backed securities. We terminated our outsourcing relationship in 2008 and began managing our securities investments internally at that time. The remaining non-agency mortgage-backed securities carry a fair value of $20.9 million, less than 2.0%, of the investment portfolio as of December 31, 2013. These remaining non-agency mortgage-backed securities have been written down $7.0 million to address any future losses. We consider the earnings stream on this remaining balance to be of greater value than the risk of additional losses. We believe that our active management of this portfolio has helped minimize our losses and positioned us to use our large securities portfolio to meet the sometimes unpredictable liquidity needs of our clients and to optimize yields. Strong brand and reputation in the entrepreneurial and venture capital community. We believe that we have developed a strong brand and market reputation within the entrepreneurial community and have strong relationships with more than 125 venture firms nationwide who are both clients and a source of referrals for entrepreneurial company clients. By capitalizing on the business and personal relationships of our senior management team in the entrepreneurial and venture communities, we believe that we are positioned to continue to grow our business and our client base. Table of Contents Our Operating Strategy Our strategic focus is on continuing to build market share and strong revenues complemented by operational efficiencies. We expect to accomplish this by continuing to attract new venture firm and portfolio company relationships while continuing to strengthen existing relationships with entrepreneurs and venture firms. We intend to pursue the following core strategies to achieve those goals: Building our presence within the entrepreneurial and venture community in our existing and target markets by: leveraging the strong relationships and reputations of our experienced venture bankers to grow our market share in key entrepreneurial and venture markets nationwide; growing our loan portfolio, including asset-based loans, and continuing to enhance our product offerings to expansion and late stage companies; expanding our suite of deposit and investment products, which is important to support the growth of our venture firm and portfolio company clients; and deploying the capital from this offering to support our lending and deposit growth. Maintaining excellent credit quality by: continuing to aggressively monitor the performance of our borrowers, which allows us to proactively manage credit exposure; and upgrading our systems to more effectively and efficiently monitor asset quality as we grow. Expanding and growing our noninterest income and relationship profitability by: growing the assets under management of Square 1 Asset Management, a registered investment adviser, that was launched in April 2013 to provide a critical cash management tool for our clients and which provides us with income-generating off-balance sheet alternatives to manage the large and sometimes volatile fund flows typical of our clients; growing our foreign exchange and letter of credit fee income; growing our service charges and fees as we grow our lending and deposit relationships; and continuing our practice of taking warrants for equity positions in the companies we serve. Growing our core deposits, and prudently and expertly managing strong deposit inflows by: continuing to grow deposits organically; managing our investment portfolio in a conservative manner consistent with our liquidity needs and asset/liability management strategies including to optimize yields; and continuing to develop alternative cash management solutions for our clients that allow us to move client funds on and off balance sheet. There are no assurances that we will be able to successfully implement our business strategy or that we will achieve our strategic goals or our projected growth. Our Market Opportunity The venture banking market in the U.S. includes companies in industries with high potential for innovation and growth, such as technology and life sciences. These entrepreneurial companies can be located anywhere, but venture activity tends to be concentrated in key markets which are hubs for academia and innovation. As a result, in addition to our home office in the greater Research Triangle Park area, we maintain offices in Silicon Valley, San Diego, Campbell, Orange County and Los Angeles, CA, Boston, Austin, the Washington, DC metropolitan area, Denver, New York City and Seattle. We also recently Table of Contents hired key personnel in Chicago and plan to open loan production offices in San Francisco and Chicago in 2014, as these markets continue to evolve as focal points for the development of venture capital-backed early through late stage companies. Our market opportunity is driven in large part by the number and amount of venture capital investments because, as entrepreneurial companies receive venture capital investments, they require banking services beyond what they may have obtained when they were formed. The peak year for venture capital investment in the U.S. was in 2000, a period in which approximately 8,041 companies received a total of nearly $105.2 billion in equity investment as reported in the MoneyTree Report. However, as reported in the MoneyTree Report, in a more typical year, an average of 3,774 companies receive venture capital investments for aggregate average annual equity investments of approximately $20.0 billion to $30.0 billion. The following data from the MoneyTree Report shows venture capital investment by stage of emerging companies in 2013: Stage of Development Number of Deals Investment (in 000 s) Seed 218 $ 942,953 Early Stage 2,003 9,758,813 Expansion 984 9,838,458 Later Stage 790 8,824,734 Total 3,995 $ 29,364,958 We believe that the market data demonstrates the robust opportunities for growth in our core market. Our deposit and loan portfolio includes entrepreneurial companies at all stages of their life cycles as well as the venture firms. These venture-backed companies need specialized banking services and we are well-positioned, as one of only two commercial banks almost exclusively focused on this market, to capitalize on these opportunities consistent with our past successes. Corporate Information Our principal executive office is located at 406 Blackwell Street, Suite 240, Durham, North Carolina 27701, and our telephone number is (866) 355-0468. Our website address is www.square1financial.com. The information contained on our website is not a part of, or incorporated by reference into, this prospectus. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001337675_tower-us_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001337675_tower-us_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary may not contain all the information that may be important to you. You should read this entire prospectus, including the financial data and related notes, before making an investment decision. See the section entitled Risk Factors on page 5 for a discussion of certain factors to be considered in connection with making an investment in the notes being offered under this prospectus. The Company Jazz Technologies, Inc., through its wholly owned subsidiaries, is an independent pure-play semiconductor foundry focused on specialty process technologies for the manufacture of analog and mixed-signal semiconductor devices. Typically, pure-play foundries do not offer products of their own, but focus on producing integrated circuits, or ICs, based on the design specifications of their customers. We manufacture semiconductors for our customers primarily based on third party designs and our own process technology and engineering support. We also provide design support and complementary technical services. ICs manufactured by us are incorporated into a wide range of products in diverse markets, including cellular phones, wireless local area networking devices, digital TVs, set-top boxes, gaming devices, switches, routers and broadband modems. Our principal executive offices are located at 4321 Jamboree Road, Newport Beach, California 92660, and our telephone number is (949) 435-8000. The Offering Securities Offered Under This Prospectus We previously issued $58,307,000 aggregate principal amount of 8% Convertible Senior Notes due December 2018. The notes are convertible, under specified circumstances, into ordinary shares of our parent company, Tower Semiconductor, Ltd. The selling security holders identified herein may, from time to time, use this prospectus to resell the notes. Use of Proceeds The notes covered by this prospectus are being offered by certain selling security holders and not by our company. Consequently, our company will not receive any proceeds from the sale of these notes. Summary of the Terms of the Notes Issuer Jazz Technologies, Inc., a Delaware corporation. Notes Offered $58,307,000 aggregate principal amount of 8% senior convertible notes due December 2018. Maturity Date December 31, 2018. Interest 8% per year, payable semiannually in arrears in cash on July 15 and January 15, commencing on July 15, 2014. Guarantees The notes are fully and unconditionally, and jointly and severally, guaranteed on an unsecured senior basis by our domestic subsidiaries. Ranking The notes are unsecured senior obligations of our company and rank equally with all of our existing and future unsecured senior debt and senior to all of our existing and future subordinated debt. The notes effectively rank junior to any of our existing and future secured debt to the extent of the value of the assets securing such debt. As of March 31, 2014, the notes rank (1) equally with approximately $49 million principal amount of other unsecured senior debt, which constitute of the notes due June 2015 of our company and the guarantors and (2) effectively subordinated to our up to $70 million Wells Fargo credit line, under which our actual borrowings as of March 31, 2014 were $19 million. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer o Accelerated filer o Non-accelerated filer Smaller reporting company o (Do not check if a smaller reporting company) CALCULATION OF REGISTRATION FEE Proposed Maximum Proposed Maximum Amount of Title of Each Class of Amount to be Offering Aggregate Registration Securities to be Registered Registered Price per Unit (1) Offering Price (1) Fee 8% Convertible Senior Notes due 2018 $ 58,307,000 100 % $ 58,307,000 $ 7,510 Guarantees of 8% Convertible Senior Notes due 2018 (2) (3 ) Total $ 58,307,000 $ 58,307,000 $ 7,510 (1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(a) under the Securities Act of 1933, as amended. (2) See the following page for a table of guarantor registrants. (3) Pursuant to Rule 457(n), no additional registration fee is payable with respect to the guarantees. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the SEC acting pursuant to said Section 8(a), may determine. Conversion Privilege Subject to compliance with the provisions of the indenture governing the notes, the holder of a note is entitled, at its option, at any time prior to the maturity date, to convert the note or any portion of the principal amount thereof that is an integral multiple of U.S. $1,000 into ordinary shares of our parent company, Tower Semiconductor, Ltd, at the conversion rate and under other conditions as provided in the indenture. See "Description of the Notes Conversion Privilege." Change of Control If we experience specific kinds of change of control events, we must offer to repurchase the notes at a price of 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See "Description of the Notes Change of Control." Certain Covenants The indenture governing the notes contains certain customary covenants including covenants restricting our ability and the ability of our subsidiaries to, among other things, incur additional debt, incur additional liens, make specified payments and make certain asset sales. Each of these covenants is subject to important exceptions and qualifications. See "Description of the Notes Certain Covenants." Absence of Trading Market for Notes We do not intend to apply for a listing of the notes on any securities exchange, quotation system or on PORTAL. Accordingly, we cannot assure you that a liquid market for the notes will develop or be maintained. Trustee U.S. Bank National Association
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001348324_ldr_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001348324_ldr_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001350773_kitara_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001350773_kitara_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..b3ab7124227b767dd72dfc350e2c8162f85ec9e2
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights key information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and financial statements that follow. It may not contain all of the information that is important to you. You should read the entire prospectus, including the section entitled
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355459_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355459_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001355459_sungard_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355466_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355466_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355520_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355520_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355553_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355553_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355555_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355555_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001355555_sungard_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355600_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355600_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355603_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355603_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355604_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355604_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355605_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355605_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355612_automated_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355612_automated_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355613_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355613_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355620_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355620_sungard_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001355637_online_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001355637_online_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001366340_finjan_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001366340_finjan_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..1e14d2ba83ac670f4978c400fdfd2fcf8c2feead
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+++ b/parsed_sections/prospectus_summary/2014/CIK0001366340_finjan_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1/A The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell, nor does it seek an offer to buy these securities, in any jurisdiction where the offer or sale is not permitted. PROSPECTUS SUBJECT TO COMPLETION, DATED APRIL 7, 2014 21,556,447 Shares FINJAN HOLDINGS, INC. Common Stock This prospectus relates to the offer and resale or other disposition from time to time by the selling stockholders of up to 21,556,447 shares of the common stock, par value $0.0001 per share, of Finjan Holdings, Inc. a Delaware corporation. We will not receive any proceeds from the sale of shares held by the selling stockholders. The selling stockholders may, from time to time, sell, transfer or otherwise dispose of any or all of their shares of our common stock or interests in shares of our common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions, as set forth in this prospectus under Plan of Distribution. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. If these shares are sold through underwriters, broker-dealers or agents, the selling stockholders will be responsible for underwriting discounts or commissions or agents commissions. We have agreed to pay all costs and expenses of this registration. Our common stock is quoted on OTC Markets OTCQB tier under the symbol FNJN. We effected a 1-for-12 reverse stock split of our common stock, and our common stock commenced trading on a post-split basis, on August 22, 2013. On April 3, 2014 the last reported closing bid price for our common stock as reported on the OTCQB tier of the OTC Markets was $ 6.65 per share. These over-the-counter quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions. You are urged to obtain current market quotations of the common stock. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 11 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities offered hereby or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. This prospectus is part of a registration statement we filed with the Securities and Exchange Commission (the SEC ). You should rely only upon the information contained in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus does not constitute an offer to sell or a solicitation of offers to buy any securities other than the common stock offered by this prospectus. This prospectus does not constitute an offer to sell or solicitation of offers to buy securities in any jurisdiction where, or in any circumstances in which, such offer or solicitation is unlawful. You should assume the information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of common stock. Neither the delivery of this prospectus nor any sale made in connection with this prospectus shall, under any circumstances, create an implication that there has been no change in our affairs since the date of this prospectus or that the information contained by reference to this prospectus is correct as of any time after its date. Our business, financial condition, results of operations and prospects may have changed since date of this prospectus. The rules of the SEC may require us to update this prospectus in the future. Our Web and Network Security Technology Business Overview Through Finjan, we own a portfolio of patents, related to software that proactively detects malicious code and thereby protects end users from identity and data theft, spyware, malware, phishing, trojans and other online threats. Finjan s mission is to invest in innovation and encourage the development of core intellectual property. Founded in 1997, Finjan developed and patented technology that is capable of detecting previously unknown and emerging threats on a real-time, behavior-based, basis, in contrast to signature-based methods of intercepting only known threats to computers, which were standard in the online security industry during the 1990s. As the network, web and endpoint security industries have transitioned to behavior-based detection of malicious code, we believe that our patented technology is widely used by third parties. Development of Finjan s Business Finjan was founded in 1997 as a wholly-owned subsidiary of Finjan Software Ltd, an Israeli corporation, which we refer to as Finjan s initial parent, to cultivate proprietary technology that focused on proactively detecting threats to online security by identifying patterns and behavior of online viruses and other malicious code, rather than relying on lists of threats known within the online security industry. This technology allows users to proactively scan and repel the latest, and often unknown, threats to network, web, and endpoint security on a real-time basis. Following the development of its patented technology, Finjan s initial parent, together with its subsidiaries, provided secure web solutions, including security software and hardware, to the enterprise and endpoint markets. In 2002, Finjan s initial parent engaged in a reorganization in which Finjan Software, Inc., a Delaware corporation, or FSI, was formed to acquire and hold all of the capital stock of Finjan. Between 2002 and 2009, FSI focused its efforts on research and development and sales and marketing activities in an effort to bolster its position in the industry and enhance its portfolio of content inspection technologies. During that time period, FSI s activities were funded primarily by venture capital firms with experience providing capital and management expertise to software security firms, some with investment and operational experience within Israel s cybersecurity and technology sectors. Finjan also received financial backing from multi-national software and technology companies. Between approximately 2002 and 2006, competitors in the online security industry began moving towards real-time, behavior-based, proactive threat detection, at times in violation of Finjan s patent rights and, beginning in 2005, Finjan commenced licensing and enforcing its patents through litigation against third parties it believed were infringing its patents. In October 2009, FSI transferred its portfolio of intellectual property to Finjan (its wholly-owned subsidiary at the time). Thereafter, in November, 2009, FSI sold certain assets, including certain of its operating subsidiaries (other than Finjan) and its sales and marketing assets, and Finjan granted a patent license to M86 Security, Inc., which we refer to as M86 . In connection with that transaction, and subsequent to November 2009, FSI and its remaining subsidiaries (including Finjan) ceased the development, marketing and sale of its products, but Finjan retained all of its patents and related rights. Following the M86 transactions, Finjan raised additional funds from its existing stockholders to finance its activities, which have consisted primarily of licensing and enforcing its intellectual property rights in network, web and endpoint security fields. See Business Licensing and Enforcement Business below. UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 6 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 FINJAN HOLDINGS, INC. (Exact name of registrant as specified in its charter) Delaware (state or Other Jurisdiction of Incorporation or Organization) 6719 (Primary Standard Industrial Classification Code Number) 20-4075963 (I.R.S. Employer Identification Number) 122 East 42nd Street New York, New York 10168 (646) 755-3320 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Philip Hartstein 122 East 42nd Street New York, New York 10168 (646) 755-3320 (Name, address, including zip code, and telephone number including area code, of agent for service) Copies of all communications, including communications sent to agent for service, should be sent to: Elliot Press Katten Muchin Rosenman LLP 575 Madison Avenue New York, NY 10022 Tel.: (212) 940-6348 Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. S If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b2 of the Exchange Act. Large accelerated filer Accelerated filer x Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company o CALCULATION OF REGISTRATION FEE Title of Securities to be Registered Amount to be Registered(1)(2) Proposed Maximum Offering Price Per Share (2)(3) Proposed Maximum Aggregate Offering(2) Amount of Registration Fee(4) Common Stock, $0.0001 par value per share 21,556,447 Shares $12.00 $258,677,364 $35,283.58 (1) This Registration Statement also registers such additional and indeterminable number of shares as may be issuable due to adjustment for changes resulting from stock dividends, stock splits and similar transactions, pursuant to Rule 416 under the Securities Act of 1933, as amended. (2) Gives effect to a 1-for-12 reverse stock split that became effective on August 22, 2013. (3) Estimated solely for the purpose of calculating the amount of the registration fee pursuant to 457(c) based on the average of the bid and asked prices of the common stock reported on the OTCQB tier of OTC Markets on July 10, 2013, which is 4 business days prior to the date upon which this Registration Statement was originally filed. (4) Previously paid. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. In April 2013, Finjan distributed securities of two unaffiliated entities which it previously held to FSI, and made a payment of cash in an amount sufficient to repay and satisfy in full an intercompany loan from FSI to Finjan. Following that distribution, the board of directors and stockholders of FSI approved the dissolution of, and a plan of liquidation for, FSI that resulted, among other things, in the distribution of Finjan common stock to certain of FSI s stockholders, each of whom received shares of our common stock in the reverse merger described below. Licensing and Enforcement Business Through Finjan, we generate revenues and related cash flows by granting intellectual property licenses for the use of patented technologies that we own by actively licensing and enforcing our patent rights against unauthorized use of our technologies (i.e. non-compliant licensees). Most of our license agreements, whether entered into via negotiated transactions or enforcement litigation or otherwise, are structured on a paid-up basis (meaning we receive a one-time lump sum payment instead of future payments or royalties in exchange for a license to use our technology in accordance with the applicable license agreement), while some of our license agreements provide for future royalty payments in the event the licensee achieves milestones specified in the applicable license agreement. Upon entering into a new patent license agreement, the licensee typically agrees to pay consideration for sales made prior to the effective date of the license, in an amount related to the royalties we would have received had a license been in effect at the time of such sales. Although the Company is actively pursuing negotiated licenses apart from litigation settlements, the Company has not entered into a license agreement outside of a settlement since 2012. In June 2006, Finjan s initial parent filed a patent infringement lawsuit against Secure Computing Corp. and its subsidiaries, which we refer to collectively as Secure Computing, in the United States District Court for the district of Delaware, which we refer to as the Secure Computing Litigation. Finjan, which succeeded FSI as the plaintiff in the litigation, asserted that Secure Computing had willfully infringed three of Finjan s U.S. patents and sought an injunction and damages for such infringement. In the Secure Computing Litigation, Secure Computing filed counterclaims for patent infringement, asserting that Finjan was infringing two U.S. patents. At trial, a jury determined that Secure Computing willfully infringed Finjan s three patents and found that Finjan did not infringe Secure Computing s patents. The jury awarded Finjan approximately $9.0 million for past infringement and in August 2009 and the award was subsequently increased to approximately $37.3 million, including interest of $3.1 million, in July 2011. Post judgment interest continued to accumulate until the date of the payment. The court also issued a permanent injunction prohibiting Secure Computing from making, using, selling or offering to sell any infringing products. In September 2011, Finjan received gross proceeds of $37.9 million from Secure Computing, including $3.1 million of interest, in satisfaction of the judgment. Finjan paid approximately $9.3 million of legal and success fees incurred in connection with the Secure Computing Litigation from such proceeds. In 2010, Finjan filed a patent infringement lawsuit against five additional software and technology companies, which we refer to as the 2010 Litigation. Finjan negotiated out-of-court settlements with two of the defendants while three defendants continued to trial. Following a three-week jury trial held in December 2012, the jury rendered an adverse verdict in the 2010 Litigation. The jury concluded that the defendants that proceeded to trial were not liable for infringement and also concluded that certain claims in two of Finjan s patents were invalid. Finjan filed a post-trial motion to set aside the jury s verdict, but the motion was denied. We intend to appeal the jury s verdict rendering the subject claims of the two patents invalid. There can be no assurance, however, that such appeal will be successful. If unsuccessful, the subject claims of the two patents will continue to be invalid in future licensing and enforcement actions. In April 2012, Finjan entered into a binding memorandum of understanding, or MOU, with one of the parties in the 2010 Litigation. As part of the MOU, Finjan agreed to withdraw its claims against such party in the 2010 Litigation and grant such party a license to use Finjan s patents. The license is fully paid up unless the holder of the license has aggregate annual net sales to third party distributors or re-sellers in excess of $10 million (which has not been achieved to date). The MOU provided for the issuance to Finjan of 3.765% of the party s common stock, which had a fair value at the time of settlement of approximately $8.4 million, and cash payments in the aggregate amount of $3.0 million, payable in three equal payments of $1.0 million, within eighteen months after the effective date of the final settlement and license agreement. Finjan has received all of the above-mentioned shares and the three installment payments. The payments accrued interest at the rate of 4% per annum until paid and were recognized when such payments are received. Prior to the Reverse Merger, Finjan distributed all of the shares of common stock it received in the Settlement to its then-parent company and accordingly we do not own or have an interest in this company. In November 2012, Finjan signed a Confidential Settlement, Release and License Agreement with one of the parties to the 2010 Litigation, a large, multinational software and technology company. Pursuant to the agreement, the counter-party paid a one-time fully paid up license fee to Finjan in the gross amount of $85 million in exchange for a perpetual, non-exclusive worldwide license to all of Finjan s and its affiliates patents, including patent rights owned or controlled by Finjan or its affiliates as of the date of such agreement and patents with a first effective priority date occurring at any time prior to November 2022 that Finjan or its affiliates may own or control after the date of such agreement. Following the signing of the agreement, Finjan dismissed all claims against the counter-party (including its affiliates). Our web and network security technology segment generated approximately $5.59 million in net loss, $50.96 million in net income and $24.20 million in net income during the years ended December 31, 2013, 2012 and 2011, respectively. Approximately $50 million of our $50.96 million net income for the year ended December 31, 2012 and approximately $24.9 million of our net income for the year ended December 31, 2011 was derived from gains on settlement. For the year ending December 31, 2013, net loss of $5.59 million in our web and network security technology segments was offset by approximately $1.0 million derived from a license achieved in a settlement. Growth Strategy Our mission is to invest in innovation and encourage the development of core intellectual property. We believe our patented technology that is capable of detecting previously unknown and emerging threats on a real-time, behavior-based, basis, in contrast to signature-based methods of intercepting only known threats to computers, is significant and we intend to further monetize our technology through licensing. This may include the pursuit of new patents relating to technology we currently own through the continued prosecution of pending patent applications relating to our existing technology, the identification of new uses for our existing technology that may be patentable (and obtaining patent protection for such new uses) and prosecuting patent applications in additional (non-U.S.) jurisdictions. We also intend to expand our technology and intellectual property portfolio through strategic partnerships and acquisitions, as discussed below. Future licensing efforts may involve negotiated transactions or, if necessary, enforcement of our patent rights through litigation or other means. In addition to expanding our intellectual property portfolio by seeking additional patent protections relating to technology we currently own (as described above), we intend to acquire and develop new technology and invest in intellectual property through acquisitions and strategic partnerships. We intend to broaden our technology and patent holdings by working with inventors, acquiring technology companies, investing in research laboratories, start-ups, universities, and by creating strategic partnerships with large companies seeking to effectively and efficiently monetize their technology and patent assets. Currently, however, we do not have the resources to engage in internal research and development or internal development of new technology through our existing operating platform, and we expect that any new technology that we acquire in the foreseeable future will be developed by strategic partners or businesses we may acquire or in which we may invest. While we anticipate that our initial focus will remain in network, web and endpoint security, we may seek to diversify to a broader software definition in the future. Our experience with monetizing both technology and patents may be considered useful by potential acquisition candidates and strategic partners who may lack resources (in terms of capital, personnel and time) to effectively and efficiently generate a return for those investments. As part of our acquisition and strategic partnership strategy, we will seek to identify technology and patents that have been or are anticipated to be widely adopted by third parties in connection with the manufacture or sale of products and services. To date, other than a small patent portfolio that we acquired in 2005 and substantially sold thereafter, we have not acquired any material technology or intellectual property from third parties and no assurance can be given that we will be able to execute our acquisition and strategic partnership strategy on terms acceptable to us, if at all. However, we intend to leverage the contacts and expertise of our directors and executive officers who, through their backgrounds in the venture capital, technology and intellectual property monetization industries have experience identifying potentially valuable opportunities for future investment. Patented Technology Through Finjan, we currently have twenty-two U.S. patents. Finjan s current U.S. issued patents expire at various times from 2016 through 2032 and it currently has four U.S. patent applications pending as of the date of this filing. Finjan also has 11 international patents and 4 international patent applications pending as of the date of this filing. Although we may from time to time focus on monetizing certain of these patents, we consider all of our patents to be core patents for our business. Competition We expect to encounter significant competition in the area of patent acquisitions and enforcement. This includes a growing number of competitors seeking to acquire the same or similar patents and technologies that we may seek to acquire. Entities including Acacia Research Corporation, Interdigital, Inc., RPX Corporation (generally on behalf of subscribing operating companies), Rambus Inc., Tessera Technologies Inc., Wi-LAN Inc. and Pendrell Corp. compete in acquiring rights to patents, and we expect more entities to enter the market. Other companies may develop competing technologies that offer better or less expensive alternatives to our patented technologies that we may acquire and/or out-license. We also compete with venture capital firms, strategic corporate buyers and various industry leaders for technology acquisitions and licensing opportunities. Our Organic Fertilizer Business Overview Through our Converted Organics subsidiary, we operate a processing facility in Gonzales, CA that uses food and agricultural waste as raw materials to manufacture all-natural fertilizer and soil amendment products combining nutritional and disease suppression characteristics for sale to our agribusiness market. We anticipate that any future revenue from our fertilizer business will be based upon our continued operation of our Gonzales, CA facility and possibly licensing the use of our technology to others. We are evaluating whether to continue our organic fertilizer business. There can be no assurance that we will continue to operate our organic fertilizer business as previously operated or at all, or that such business will become profitable. Production and Sale of Organic Fertilizer Our organic fertilizer is produced exclusively at our Gonzales, CA plant. The plant currently produces predominantly liquid products; with additional capital it could be modified to enable production of additional dry products as well. Revenue from our fertilizer manufacturing operations is predominately generated from the sale of liquid product to the agribusiness market in California, though we do generate a small amount of revenue from tip fees (which are fees charged to waste haulers who pay us a fee for accepting food waste generated by food distributors, food providers and hospitality venues) associated with the receipt of food waste at the facility and sales of a limited amount of dry products. Through Converted Organics, we sell and distribute the fertilizer manufactured at the Gonzales, CA plant through a small group of sales professionals who seek out large purchasers of fertilizer for distribution in our target geographic and product markets. Key activities of the sales organization include the introduction of our products to target clients and the development of our relationships with them. Due to Converted Organics small size, we believe that the most efficient means of distributing our fertilizer products is on a whole-sale basis to regional distributors, and this method currently accounts for the majority of our sales. To the extent that we make sales directly to customers, we generally require our customers to handle delivery of the product. To generate product for sale, we use a high temperature liquid compositing, or HTLC, process to convert food waste and other feedstock into fertilizer. In simplified terms, the process operates by encouraging naturally-occurring microbes to consume prepared feedstock. The action of the microbes on the feedstock is exothermic (heat-releasing), and causes the temperature of the feedstock to rise to very high, pathogen-destroying levels. Subsequently, thermophilic (heat-loving) bacteria naturally occurring in the food waste utilize oxygen to convert the waste into a rich blend of nutrients and single-cell proteins (aerobic digestion). Feedstock preparation, digestion temperature, rate of oxygen addition, acidity, and inoculation of the microbial regime are carefully controlled to produce products that are highly consistent from batch to batch. The HTLC method can be used in any future operating plants, whether owned by us or licensed. Our Gonzalez facility is our sole producer of our fertilizer product. Converted Organics, Inc., the former parent of Converted Organics of California, is considered the acquiree for accounting purposes in the Reverse Merger. The results of operations of Converted Organics have been included in our assets and liabilities and our historical operations since June 3, 2013, the date we completed the Reverse Merger. Accordingly, the following historical results of operations of Converted Organics are included in the pro forma financial information in the footnotes to the consolidated financial statements included elsewhere in this filing. During 2013, 2012 and 2011, Converted Organics generated approximately $1.6 million (of which approximately $0.7 million was generated after the Reverse Merger and is included in our results of operations), $1.5 million and $2.8 million of revenue, respectively, from the sale of fertilizer from this facility. Competition We operate our organic fertilizer business in a very competitive environment. The organic fertilizer business requires us to compete in three separate areas organic waste stream feedstock, technology, and end products each of which is quickly evolving. We believe our organic fertilizer business will be able to compete effectively, with adequate financial resources, because of the abundance of the supply of food waste in our geographic markets, the pricing of our tip fees, and the quality of our products and technology. Competition for the organic waste stream feedstock includes landfills, incinerators, animal feed, land application, and traditional composting operations. There are a variety of methods used to treat organic wastes, including composting, digestion, hydrolysis, and thermal processing. Companies using these technologies may compete with us for organic material. Despite a large number of new products in the end market, we believe that our products have a unique set of characteristics. We believe positioning and branding the combination of nutrition and disease suppression characteristics will differentiate our products from other organic fertilizers to develop market demand, while maintaining or increasing pricing. Governmental Regulation Our end products are regulated by federal, state, county, and local governments, as well as various agencies thereof, including the United States Department of Agriculture. In addition to the regulations governing the sale of our end products, our current facility and any future facilities are subject to extensive regulation. Specific permit and approval requirements are set by the state and state agencies, as well as local jurisdictions including but not limited to cities, towns, and counties. Any changes to our plant or procedures would likely require permit modifications. Environmental regulations will also govern the operation of our current facility and any future facilities. Regulatory agencies may require us to remediate environmental conditions at our locations. Future Development We need additional capital to build additional plants to grow our organic fertilizer business or we need to license others to use our technology. Our Converted Organics subsidiary does not have funds to build additional facilities and we have no plans to raise such funds or allocate funds generated from our online security technology business for that purpose. We are evaluating whether to continue our organic fertilizer business as currently conducted. There can be no assurance that we will continue to operate our organic fertilizer business as previously operated or at all. We do not intend to use significant amounts of cash on hand generated by Finjan to fund our organic fertilizer business. Corporate Information and History Finjan Holdings, Inc. (formerly, Converted Organics Inc.) was incorporated in Delaware in January of 2006 for the purpose of establishing a waste-to-fertilizer business. In February 2007, we successfully completed both a $9.9 million initial public offering of stock and a $17.5 million bond offering with the New Jersey Economic Development Authority. The net proceeds of these offerings were used to develop and construct a fertilizer manufacturing facility in Woodbridge, New Jersey. In January of 2008, we acquired the assets of Waste Recovery Industries, LLC and United Organic Products, LLC, including our processing facility in Gonzales, California and related technology rights. Also in 2008, operations commenced at the Woodbridge, New Jersey plant, with the production of dry fertilizer product beginning in 2009. We subsequently began distribution of the dry product in the professional turf and retail markets. In 2009, we also raised $27 million of additional capital and the Gonzales, California facility became cash flow positive. In 2010, we closed the Woodbridge, New Jersey plant, making the Gonzales, California plant our sole fertilizer manufacturing facility. In March 2010, we began to operate an Industrial Wastewater Resources, or IWR, division to leverage our exclusive license of the LM-HT Concentrator technology for the treatment of industrial wastewater. On March 23, 2010, we entered into a loan and license agreement with Heartland Technology Partners, LLC, or HTP. On September 17, 2012, we completed a transaction with HTP whereby we terminated all rights under the license agreement in exchange for $650,000 and we no longer have any rights under that agreement. In light of the termination of our agreement with HTP, we will not generate future revenue from, or own any assets in, the IWR segment of our business and as such, the results of operations for the years ended December 31, 2012 and 2011 were classified as discontinued operations. Table of Contents PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. It may not contain all of the information that you should consider before investing in our common stock. You should read this entire prospectus carefully, including the Risk Factors and the financial statements and related notes included herein. This prospectus includes forward-looking statements that involve risks and uncertainties. See Cautionary Note Regarding Forward-Looking Statements. Unless the context otherwise requires or where otherwise indicated (i) we, our, us, our company, the company and similar expressions used in this prospectus refer to Finjan Holdings, Inc. (formerly Converted Organics, Inc.) and its consolidated subsidiaries, collectively; (ii) the term Finjan refers to Finjan, Inc., one of our wholly-owned subsidiaries, which we acquired in the acquisition completed on June 3, 2013; and (iii) the term Converted Organics refers to Converted Organics of California LLC and its subsidiaries, which we owned prior to our acquisition of Finjan. Throughout this prospectus, we refer to the business we conduct through Finjan as our online security technology business and we refer to the business we conduct through Converted Organics as our organic fertilizer business. We effected a 1-for-12 reverse stock split of our common stock on August 22, 2013. Throughout this prospectus, all share, share equivalents and per share information is presented on an as adjusted basis, giving effect to the 1-for-12 reverse stock split, unless otherwise indicated or the context otherwise requires. Our Business Overview Effective as of June 3, 2013, the date we consummated a reverse acquisition of Finjan and changed our name from Converted Organics, Inc. to Finjan Holdings, Inc., we operate two businesses, each of which constitutes a separate reportable segment. Our two reportable segments include: our web and network security technology segment, which we operate through Finjan, and our organic fertilizer segment, which we operate through Converted Organics. Finjan is considered the acquirer for accounting purposes in the reverse acquisition and we account for the transaction as a reverse business combination. Consequently, the assets and liabilities and the historical operations that are reflected in our historical financial statements are those of Finjan. The results of operations of our organic fertilizer segment have been included in our assets and liabilities and our historical operations since June 3, 2013, the date we completed the reverse acquisition. During the year ended December 31, 2013, we generated revenue, gain on settlements (net of legal costs) and incurred a net loss of approximately $0.7 million, $1.0 million and $6.1 million, respectively. During fiscal year 2013, all of our revenue was derived from our organic fertilizer segment, our gain on settlement was derived from a licensing agreement achieved from a settlement in our web and network security technology segment and $0.5 million and $5.6 of our net loss was derived from our organic fertilizer and web and network security technology segments, respectively. During the year ended December 31, 2012, we generated gain on settlement (net of legal costs) of $77.4 million and net income of approximately $51.0 million. During the year ended December 31, 2011, we generated gain on settlements (net of legal costs) of $24.9 million and net income of approximately $24.1 million. On May 20, 2010, we formed TerraSphere Inc., a Delaware C corporation and a wholly owned subsidiary of the Company, for the purpose of acquiring the membership interests of TerraSphere Systems, LLC, or TerraSphere Systems. On July 6, 2010, we, TerraSphere Inc., Terrasphere Systems and the members of TerraSphere Systems entered into a membership interest purchase agreement, pursuant to which we agreed to acquire the membership interests of TerraSphere Systems. The agreement was approved by our stockholders on September 16, 2010 and we acquired 95% of the membership interests of TerraSphere Systems on November 12, 2010. TerraSphere Systems is in the business of designing, building, and operating highly efficient and scalable systems, featuring a patented, proprietary technology that utilizes vertically-stacked modules to house rows of plants, which are then placed perpendicular to an interior light source to grow pesticide and chemical-free organic fruits and vegetables. On December 7, 2012, we entered into an agreement, whereby we transferred our entire ownership of TerraSphere Inc. and its subsidiaries to a third party. The purchaser received all of the assets of TerraSphere Inc. and its subsidiaries, assumed all of the liabilities of TerraSphere Inc. and its subsidiaries and paid us nominal cash consideration. In light of the sale of TerraSphere Inc. and its subsidiaries, we will not generate future revenue from the vertical farming segment of our business. On June 3, 2013, we entered into an Agreement and Plan of Merger, which we refer to as the Merger Agreement, with Finjan and COIN Merger Sub, Inc., or Merger Sub, pursuant to which Merger Sub merged with and into Finjan, with Finjan being the surviving corporation. Throughout this prospectus, we refer to the transactions contemplated by the Merger Agreement as the Reverse Merger. The Reverse Merger was consummated on June 3, 2013. As a result of the Reverse Merger, Finjan became our wholly-owned subsidiary and former holders of Finjan s capital stock received an aggregate of 20,467,058 shares (on an adjusted basis, after giving effect to the 1-for-12 reverse stock split that we effected on August 22, 2013) of our common stock, or 91.5% of our outstanding common stock at the effective time of the Reverse Merger (on a fully-diluted basis, but excluding any shares underlying the options to purchase up to an aggregate of 1,585,476 shares (on an adjusted basis, after giving effect to the 1-for-12 reverse stock split) of our common stock issued pursuant to the Merger Agreement). On June 3, 2013, as a condition to the closing of the Reverse Merger, we entered into an Exchange Agreement, which we refer to as the Exchange Agreement, with Hudson Bay Master Fund Ltd., a Cayman Islands company, which we refer to as Hudson Bay, and Iroquois Master Fund Ltd., a Cayman Islands company, which we refer to Iroquois. Pursuant to the Exchange Agreement, immediately following the effectiveness of the Reverse Merger, each of Hudson Bay and Iroquois exchanged an aggregate of $1,192,500 principal amount of our convertible notes, 13,281 shares of our Series A Preferred Stock and warrants to purchase an aggregate of 105,554 shares (on an adjusted basis after giving effect to the 1-for-500 and 1-for-12 reverse stock splits effected on June 3, 2013 and August 22, 2013, respectively) of our common stock for an aggregate of 1,789,470 shares (on an adjusted basis, after giving effect to the 1-for-12 reverse stock split that we effected on August 22, 2013) of our common stock, or 8% of our outstanding common stock immediately following the Reverse Merger (on a fully-diluted basis, but excluding any shares underlying the options to purchase up to an aggregate of 1,585,476 shares (on an adjusted basis, after giving effect to the 1-for-12 reverse stock split) of our common stock issued pursuant to the Merger Agreement). Each of Hudson Bay and Iroquois also released us, our affiliates, subsidiaries and related companies from any and all debts, liabilities and other claims with respect to such convertible notes, Series A Preferred Stock and warrants. Prior to the Reverse Merger, our corporate name was Converted Organics, Inc. On June 3, 2013, we entered into an Agreement and Plan of Merger with our wholly-owned subsidiary, Finjan Holdings, Inc., a Delaware corporation, which was formed solely for the purpose of effecting the change of our corporate name, which we refer to as Name Change Merger Sub, pursuant to which, on June 3, 2013, Name Change Merger Sub was merged with and into our company, and our company remained as the surviving corporation. Upon filing of the Certificate of Ownership and Merger reflecting the merger of Name Change Merger Sub with and into our company with the Delaware Secretary of State on June 3, 2013, we changed our corporate name from Converted Organics, Inc. to Finjan Holdings, Inc., without obtaining shareholder approval, through a short-form merger in accordance with Section 253 of the General Corporation Law of the State of Delaware. In connection with our name change, the symbol for our common stock was changed to FNJN, effective July 2, 2013. For additional information regarding Finjan s corporate history, please see Business Online Security Technology Development of Finjan s Business above. Certain Risks Affecting Us Our business is subject to numerous risks, as more fully described below in the section of this prospectus entitled Risk Factors, including the following: Finjan s limited operating history makes it difficult to evaluate its current business and future prospects. We are presently reliant exclusively on a limited number of patented technologies that we own through Finjan. The value of our patent assets may decline. We expect litigation to enforce our patents to be time-consuming, costly and unpredictable. Finjan s revenues are unpredictable, and this may harm our financial condition. If we do not expand our licensable technology portfolio with commercially successful technologies, our prospects could be adversely affected. Concentration of ownership among our directors and largest stockholders may prevent new investors from influencing significant corporate decisions. An active, liquid and orderly trading market for our common stock may not develop, and the price of our stock may be volatile and may decline in value. If and when our registration statement becomes effective, a significant number of shares of common stock will be eligible for sale, subject to applicable lock-up agreements. The price of our common stock following the Reverse Merger may be affected by factors different from those previously affecting our shares. We expect our organic fertilizer business to incur significant losses for some time, and we may never operate our organic fertilizer segment profitably. Defects in our products or failures in quality control could impair our ability to sell our products or could result in product liability claims, litigation and other significant events with substantial additional costs. Our Gonzales, CA and discontinued Woodbridge, NJ facilities, as well as future facility sites, may have unknown environmental problems that could be expensive and time-consuming to correct. The Offering Common stock offered by the selling stockholders 21,556,447 shares. Common stock outstanding immediately after this offering 22,368,453 shares. Use of proceeds We will not receive any of the proceeds from the sale of shares of our common stock sold in this offering. The selling stockholders will receive all net proceeds from the sale of shares of our common stock in this offering. Offering Price The selling stockholders may, from time to time, sell, transfer or otherwise dispose of any or all of their shares of our common stock or interests in shares of our common stock at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. Lock-Up Agreements Selling stockholders who hold an aggregate of 19,766,977 shares of the common stock included in this offering are subject to lock-up agreements, which restrict the sale of such shares for a period of up to nine months following the date of this prospectus. Some or all of such shares may be released from such restrictions from time to time in accordance with the terms of the lock-up agreements. The restrictions on transfer contained in the lock-up agreements are subject to exceptions, including an exception that permits each selling stockholders to sell their shares at a per share sale price of $6.72 (on an adjusted basis, after giving effect to the 1-for-12 reverse stock split) or above. See Shares Eligible for Future Sale Lock-Up Agreements .
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our ordinary shares. You should read this entire prospectus carefully, especially the Risk Factors section of this prospectus and our consolidated financial statements and related notes appearing at the end of this prospectus, before making an investment decision. Some of the statements in this prospectus constitute forward-looking statements. See Special Note Regarding Forward-Looking Statements for more information. Our Company We are a global fabless provider of analog and mixed-signal semiconductor solutions currently addressing the home entertainment and cloud computing markets. Our expertise in analog and radio frequency solutions, digital signal processors and high speed interfaces serves as the foundation for our technology platform. These technical capabilities enable us to design high performance, low power semiconductors. In the home entertainment market, our technology platform enables us to design highly integrated solutions with customized software and support for set-top boxes. Our solutions are designed to optimize signal processing performance under the challenging operating conditions typically found in emerging market environments, where often broadcast signals received by the set-top box may be weak, distorted or off-specification. Our solutions contain a number of different technologies that allow for enhanced signal processing, resulting in improved overall video quality under the typically limited existing broadband network infrastructure in emerging markets. In the cloud computing market, we offer high performance, low power memory interface solutions that enable memory-intensive server applications. Our technology platform approach allows us to provide integrated solutions that meet the expanding needs of our customers through our continuous innovation, cost- and power-efficient design and rapid product development. Since our inception in 2004 through December 31, 2013, we have sold over 300 million integrated circuits, which have been shipped to over 160 end customers worldwide. While analog and mixed-signal technology is applicable to a broad array of end markets, we have been highly selective in identifying our initial target end markets. We focus on markets which we believe have compelling long-term growth prospects and are also characterized by complex product design, long life cycles and stringent qualification requirements. We believe that these market characteristics coupled with our significant investment in our technology platform have created high barriers to entry for set-top box solutions in emerging markets. Initially, we developed commercial solutions for the home entertainment market to address the rapidly growing demand for television in China, Southeast Asia and other emerging markets. According to iSuppli Corporation, or iSuppli, in 2012, 154 million set-top boxes were sold by Chinese manufacturers. We believe that set-top boxes sold by Chinese manufacturers primarily target China and other emerging markets. The number of set-top boxes sold by Chinese manufacturers is expected to grow to over 243 million units in 2016 according to iSuppli. This would represent a compound annual growth rate of 12% from 2012 to 2016. A key to our success in addressing the characteristics of the home entertainment market in emerging markets is our ability to provide integrated solutions with customized software and support, which we develop through close collaboration with our end customers. Our collaborative approach allows us to develop extensive localized knowledge of a large, fragmented market with diverse technical and service requirements, deepening our customer relationships and yielding design wins across multiple product generations. Our end customers in the home entertainment market include nine of the ten largest set-top box manufacturers in China as measured by units sold in 2012. More recently, we released our memory interface solutions to pursue opportunities arising from the rapid growth in the cloud computing market. Our close collaboration with key industry participants, including CPU manufacturers, memory module manufacturers and server original equipment manufacturers, or OEMs, has enabled us to successfully develop high performance, low power memory interface solutions for cloud computing Table of Contents The information in this prospectus is not complete and may be changed. Neither we nor the selling shareholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and neither we nor the selling shareholders are soliciting offers to buy these securities, in any jurisdiction where the offer or sale is not permitted. Subject to Completion, dated January 27, 2014 5,000,000 shares Montage Technology Group Limited Ordinary shares This is an offering of ordinary shares of Montage Technology Group Limited. We are offering 1,000,000 ordinary shares. The selling shareholders are offering 4,000,000 ordinary shares. We will not receive any of the proceeds in connection with the shares to be sold by the selling shareholders from this offering. We will bear all of the offering expenses other than the underwriting discount of the shares to be sold by the selling shareholders. Our ordinary shares are listed on the NASDAQ Global Market under the symbol MONT . On January 24, 2014, the last reported sale price of our ordinary shares on the NASDAQ Global Market was $22.99 per ordinary share. Investing in our ordinary shares involves a high degree of risk. See Risk factors beginning on page 11. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds, before expenses, to us $ $ Proceeds, before expenses, to the selling shareholders $ $ (1) See Underwriting for additional information regarding compensation. The selling shareholders have granted the underwriters an option for a period of 30 days to purchase up to 750,000 additional ordinary shares. An affiliate of an existing shareholder, UMC Capital Corporation, has indicated an interest in purchasing ordinary shares in this offering at the public offering price for up to $10 million in the aggregate. Because this indication of interest is not a binding agreement or commitment to purchase, the affiliate of UMC Capital Corporation may elect not to purchase shares in this offering or the underwriters may elect not to sell any shares in this offering to such person. The underwriters will receive the same discount and commissions from any ordinary shares purchased by the affiliate of UMC Capital Corporation as they will from any other ordinary shares sold to the public in this offering. The underwriters expect to deliver the shares to purchasers on , 2014. Deutsche Bank Securities Barclays Stifel Wells Fargo Securities Needham & Company Chardan Roth Capital Partners Prospectus dated , 2014. Table of Contents environments. We sell our memory interface solutions to memory module manufacturers, which incorporate our memory interfaces into dual in-line memory modules, or DIMMs, which are devices used to add memory capacity to a CPU. The most advanced cloud computing data servers operating today currently use DDR3 memory technology and load-reduced DIMMs, or LRDIMMs, which require memory interfaces that buffer data signals in addition to command and address signals. Memory interface vendors like us are unable to sell their solutions to memory module manufacturers without those solutions first being validated by manufacturers of CPUs. We are currently one of two LRDIMM memory buffer suppliers validated by Intel Corporation for DDR3 technology, the most prevalent industry standard for memory integrated circuits used in servers. Our customers in the cloud computing market include the world s four largest DRAM manufacturers and the world s largest third-party DRAM module supplier as measured by 2012 revenues. We offer ten solutions for use in the home entertainment market and two memory interface solutions for use in the cloud computing market. In 2012 and the nine months ended September 30, 2013, 94% and 91%, respectively, of our revenue was generated from sales of set-top box solutions targeting the home entertainment market in emerging markets, while the remaining 6% and 9%, respectively, of our revenue was generated from sales of memory interface solutions targeting the cloud computing market. Our solutions are built upon our foundation of 44 issued patents and an additional 48 pending patent applications as of December 31, 2013. As of December 31, 2013, we had 300 engineers in our research and development organization, of which 151 hold post-graduate engineering degrees. Our revenue has grown from $29.1 million in 2010 to $78.2 million in 2012, representing a compound annual growth rate of 64%, and from $54.5 million in the nine months ended September 30, 2012 to $75.4 million in the nine months ended September 30, 2013, representing an annual growth rate of 38%. We had a net loss of $8.5 million in 2010 and net income of $5.0 million in 2011, $18.3 million in 2012 and $16.8 million in the nine months ended September 30, 2013. Our Target Markets Our solutions primarily serve two large target markets, (i) the home entertainment market, in particular set-top boxes for emerging markets; and (ii) the cloud computing market, in particular memory interface solutions for data center servers. Home Entertainment Market In emerging markets, such as China, India, the Middle East, Latin and South America, Africa and Southeast Asia, television content is broadcast and accessed through satellite transmissions, cable network connections or terrestrial over-the-air transmissions. Viewers often access content from these three signal transmission systems using set-top boxes that are connected to televisions within the home. According to iSuppli, in 2012, 154 million set-top boxes were sold by Chinese manufacturers, primarily targeting emerging markets. Of the 154 million units sold, 66% were exported outside of China. The total number of set-top boxes sold by Chinese manufacturers is expected to grow to over 243 million units in 2016 according to iSuppli, with 58% of those units expected to be exported. This would represent a compound annual growth rate of 12% from 2012 to 2016. In addition, in some emerging markets, such as China, the broadcasting signal of television content is transitioning from analog to digital due to government- sponsored programs requiring the replacement or addition of television access equipment. For example, China has a goal of shutting down analog TV signals by 2015 and transitioning to digital TV in most regions. With improvements in content quality and increasing disposable income, we believe that viewers in China and other emerging markets are expected to increasingly purchase set-top boxes that can receive and display high-definition video content. While currently the satellite set-top box market is the largest market for China-manufactured set-top boxes in terms of total number of set-top boxes sold, the cable set-top box market is expected to represent an increasing proportion of China-manufactured set-top boxes from 2012 to 2016, according to iSuppli. Table of Contents Table of Contents In order to optimize for superior and robust system performance and deliver cost-efficient solutions to set-top box manufacturers, semiconductor providers are integrating multiple functions into a single silicon package. These integrated solutions also require customized embedded software and field application support to ensure proper functionality and system level performance. The demands for cost-effective yet high-performance solutions are particularly strong in emerging markets. According to iSuppli, the market for semiconductors addressing set-top boxes manufactured in China totaled $995 million in 2012 and is expected to grow to $1,316 million in 2016, with sales of integrated semiconductor solutions outpacing the growth of the overall market from 2012 to 2016. This would represent a compound annual growth rate of 7% from 2012 to 2016. Cloud Computing Market Global data center IP traffic is expected to increase from 1.8 zettabytes, or 1.8 billion terabytes, in 2011 to 6.6 zettabytes in 2016, according to the Cisco Global Cloud Index published by Cisco System, Inc., or Cisco. This would represent a compound annual growth rate of 30% from 2011 to 2016. The proliferation of mobile devices, cloud-based software applications and streaming video pose significant challenges for network data centers. In addition, the rate at which data is being consumed is growing much faster than the rate of mobile device growth. The limited memory and processing speed of mobile devices has led to a majority of content viewed on mobile devices being accessed using cloud computing technology. To meet the rising demands being placed on networks, data center operators have increased the number of servers within their facilities. In cloud computing environments where a significant number of memory-intensive applications are simultaneously being run on a server, the processing performance of CPUs is limited by the amount of memory available to the CPU. Additional memory capacity is required to ensure servers perform at optimal levels, which is critical for on-demand applications like cloud computing and virtualization. As a result, memory capacity is added to a server through the use of dual in-line memory modules, or DIMMs, which house dynamic random access memory, or DRAM. Memory performance is enhanced through the use of interface devices called memory buffers that efficiently facilitate the rapid flow of data between the CPU and memory. As the number of cores in the CPU increases, the number of DIMMs required to achieve higher performance also increases. The need for greater amounts of DRAM to support high performance computing is expected to drive the development of higher capacity DIMMs, where a greater amount of gigabit storage is placed on a single DIMM. The memory content within the overall server market is expected to grow to $3,129 million in 2016, according to Gartner Inc., or Gartner. This would represent a compound annual growth rate of 22% from 2012 to 2016. In addition, memory is expected to become a larger percentage of the server semiconductor total addressable market, increasing from 13.8% in 2012 to 21.2% in 2016, according to Gartner. Based on our knowledge gained through qualification processes with CPU and memory module manufacturers, we believe higher capacity DIMMs with memory densities equal to or above 32 gigabits will require the use of LRDIMM technology to ensure the highest server performance. Furthermore, we expect that new server platforms will need to expand the capacity for the number of DIMMs to address the increasing amount of data being transmitted over public and private networks. The number of machines using LRDIMM is expected to grow from 2.3 million in 2014 to 3.1 million in 2016, while the average number of LRDIMMs used on a single machine is expected to grow from 4.8 in 2014 to 18.3 in 2016, according to Jon Peddie Research. The increase in number of machines using LRDIMMs and average number of LRDIMMs per machine is expected to drive rapid growth in the potential available market for LRDIMM chipsets, which Jon Peddie Research estimates will increase from up to $312 million in 2014 to as much as $1,958 million in 2016. This would represent a compound annual growth rate of 151% from 2014 to 2016. In terms of unit volume, Jon Peddie Research estimates the potential available market for LRDIMM chipsets will increase from up to 18.4 million units in 2014 to as much as 93.2 million units in 2016. This would represent a compound annual growth rate of 125% from 2014 to 2016. The rise of computing power in a server also drives a significant increase in the energy costs required to operate the server. Therefore, data center operators are increasingly focused on the power efficiency of each Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+PROSPECTUS SUMMARY The information below is only a summary of more detailed information included elsewhere in this prospectus and the documents incorporated herein by reference. This summary does not contain all of the information that is important to you or that you should consider before investing in the Notes. As a result, you should read carefully this entire prospectus, as well as the information incorporated herein by reference, carefully. See "Where You Can Find More Information." The Company We are a leading operator and franchisor of travel centers primarily along the U.S. interstate highway system. Our travel center customers include trucking fleets, independent truck drivers and motorists. We also operate convenience stores with retail gasoline stations that generally serve motorists. We are a limited liability company formed under Delaware law on October 10, 2006, as a wholly owned subsidiary of Hospitality Properties Trust, or HPT. From that time through January 31, 2007, we conducted no business activities. On January 31, 2007, HPT acquired TravelCenters of America, Inc., our predecessor, restructured this acquired business and distributed all of our then outstanding common shares to the shareholders of HPT. In this prospectus, we sometimes refer to these transactions as the HPT Transaction. As of September 30, 2014, our business included 250 travel centers in 43 U.S. states and in Canada, operated primarily under the "Travel Centers of America," "TA," "Petro Stopping Centers" and "Petro" brand names. Of these travel centers, we operated 220 and franchisees operated 30, including five that they subleased from us. As of September 30, 2014, we owned 36 of these travel centers in fee and leased or managed 189 from or for others, including 184 that we leased from HPT. Franchisees owned or leased 25 travel centers from third parties. Our typical travel center includes: about 25 acres of land with parking for 189 tractor trailers and 100 cars; a full service restaurant operated under one of our proprietary brands and/or one or more quick service restaurants, or QSRs, operated under nationally franchised brand names; a large truck repair and service facility and parts store; multiple diesel and gasoline fueling points; and a large convenience store, game room, laundry and other amenities. As of September 30, 2014, we operated 34 convenience stores with retail gasoline stations, primarily under the "Minit Mart" brand name, in four states, primarily Kentucky. Of our 34 convenience stores, at September 30, 2014, we owned 27 and we leased or managed seven, including one that we leased from HPT. Our typical convenience store has ten fueling positions and approximately 5,000 square feet of interior space offering merchandise and one or more QSRs. Our Competitive Strengths We believe we possess a number of competitive strengths that enable us to be a leader in our industry and may enable us to enhance this leadership position in the future. We believe these competitive strengths include our broad geographic footprint, our large typical travel center size, the wide array of customer services and amenities we offer, our truck repair service business, which offers a wide variety of repair and maintenance services at substantially all of our travel centers, and our large variety of restaurant choices. See "Our Competitive Strengths and Growth Strategies." Copies to: Margaret R. Cohen Skadden, Arps, Slate, Meagher & Flom LLP 500 Boylston Street Boston, Massachusetts 02116 (617) 573-4800 Bartholomew A. Sheehan, III Sidley Austin LLP 787 Seventh Avenue New York, New York 10019 (212) 839-5300 Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents Our Growth Strategies We have identified a number of growth strategies, including opportunities to acquire additional travel centers and convenience stores, to construct new travel centers on land parcels we own or may acquire in the future, and to make improvements to our travel centers that we believe will make them more attractive to customers and help increase our share of the interstate highway market for fuel and nonfuel products and services. We currently intend to use the net proceeds from this offering for general business purposes, including acquisitions and construction of additional travel centers and convenience stores, funding capital improvements to our travel centers and convenience stores and other expansion activities. See "Use of Proceeds." Recent Developments Pending and Recent Acquisitions During the first nine months of 2014, we acquired three travel centers for an aggregate purchase price of approximately $25.7 million. Through the date hereof, we have entered into agreements to acquire three additional travel center properties and seven gasoline/convenience stores for an aggregate amount of approximately $21.7 million. We currently expect to complete these acquisitions before the end of the first half of 2015, but these purchases are subject to conditions and may not occur, may be delayed or the terms may change. We currently intend to continue our efforts to selectively acquire additional properties. Our acquisitions are subject to a number of risks and uncertainties, including as to when, whether and to what extent the anticipated benefits and cost savings of a particular acquisition will be realized. See "Risk Factors Risks Related to Our Acquisition and Development Plans." Since the beginning of 2011 through September 30, 2014, we have invested or planned to invest approximately $370.1 million ($331.3 million of which had been invested as of September 30, 2014) to acquire and improve 33 travel centers and 31 gasoline/convenience stores. Typical improvements we make to travel centers we acquire include adding truck repair facilities and nationally branded QSRs, paving parking lots, replacing outdated fuel dispensers, installing diesel exhaust fluid dispensing systems, changing signage, installing point of sale and other information technology systems and completing other building and cosmetic upgrades. The improvements to travel center properties we acquire are often substantial and require a long period of time to plan, design, permit and complete, and after the improvements are completed the travel centers then require a period of time to become part of our customers' supply networks and produce stabilized financial results. Based on our historical experience to date, we estimate that the travel centers we acquire generally will achieve stabilized financial results in approximately the third year after acquisition, but actual results can vary widely from this estimate due to many factors, some of which are outside our control. Development Activity We own eight parcels of largely unimproved land that we believe may be appropriate for ground-up development of new travel centers. We have begun construction of one of these travel centers, and, subject to funding, plan to commence construction of two or three of the remaining seven parcels prior to December 31, 2015. We have entered into a contract to acquire an additional parcel of land, and expect to close this acquisition and commence development of a travel center on it during the first half of 2015. Investment in Travel Centers Our business of operating high sales volume travel centers that are open 24 hours every day requires us to make regular capital investments to our travel centers to maintain their competitive attractiveness to our customers. During the nine months ended September 30, 2014, we spent approximately $95.4 million on improvements to our travel centers, including approximately CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Proposed Maximum Aggregate Offering Price(1) Amount of Registration Fee(1)(2) % Senior Notes due 2029 $115,000,000 $13,363 (1)Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended. The Company is filing this pre-effective Amendment No. 2 to Registration Statement on Form S-1 (File No. 333-200462) filed on November 24, 2014, as amended, to increase the proposed maximum dollar value of securities being registered. The Company is registering an additional $57,500,000 of % Senior Notes due 2029 and incurring additional registration fees of $6,681.50. (2)Pursuant to Rule 457(p) under the Securities Act, unused registration fees of $16,894.22 have already been paid with respect to unsold securities of the Company, including senior notes, that were previously registered pursuant to the Company's Registration Statement on Form S-3 (Reg. No. 333-181182) filed on May 4, 2012, and have been carried forward. Of these unused registration fees, $6,681.50 was offset against the registration fee due for the Registration Statement on Form S-1 (File No. 333-200462) filed on November 24, 2014 and $4,500.00 is offset against the registration fee due for the additional securies being registered on this Amendment No. 2 to Registration Statement, leaving $5,712.72 available for future registration fees. An additional registration fee of $2,181.50 has been paid with respect to this offering. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), shall determine. Table of Contents $14.5 million to improve the travel centers we acquired from 2011 through September 30, 2014. We expect to continue our capital investment program, and we expect to continue programs designed to enhance our future operating results. Our convenience stores are high volume fuel locations with larger interior space for merchandise and food offerings than typical convenience stores and limited need for near term capital investment. Risk Factors An investment in the Notes involves a high degree of risk. For a discussion of these risks, please see "Risk Factors" beginning on page 10 of this prospectus and "Warning Concerning Forward Looking Statements" beginning on page 52 of this prospectus. Corporate Information We are a Delaware limited liability company. Our principal place of business is 24601 Center Ridge Road, Suite 200, Westlake, OH 44145-5639, and our telephone number is (440) 808-9100. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED DECEMBER 8, 2014 PROSPECTUS $100,000,000 TravelCenters of America LLC % Senior Notes due 2029 Table of Contents The Offering The following summary information about this offering and the terms and provisions of the Notes is not intended to be complete. For more information, please refer to the "Description of Notes" in this prospectus and the indenture under which the Notes will be issued, the form of which is filed with the SEC as an exhibit to the registration statement of which this prospectus is a part. See "Where You Can Find More Information." Issuer TravelCenters of America LLC Securities Offered $100,000,000 aggregate principal amount of % Senior Notes due 2029 ($115,000,000 aggregate principal amount if the underwriters' overallotment option is exercised in full). Overallotment Option We have granted the underwriters an option to purchase up to an additional $15,000,000 aggregate principal amount of Notes at the public offering price, less the underwriting discount, within 30 days from the date of this prospectus solely to cover overallotments. Maturity Date December 15, 2029, unless otherwise previously redeemed. Interest Rate % per year, payable quarterly in arrears. Interest Payment Dates February 28, May 31, August 31 and November 30 of each year, beginning on February 28, 2015. Ranking The Notes will constitute senior unsecured obligations of TravelCenters of America LLC. They will not be secured by any of our property or assets and, as a result, you will be one of our unsecured creditors. The Notes will not be obligations of our subsidiaries. The Notes will be effectively subordinated to all of our existing and future secured indebtedness (including all borrowings under our credit facility) to the extent of the value of the assets securing such indebtedness and to all existing and future debt, other liabilities (including deferred rent obligations) and any preferred equity of our subsidiaries. Optional Redemption We may, at our option, at any time and from time to time on or after December 15, 2017, redeem some or all of the Notes by paying 100% of the principal amount of the Notes to be redeemed plus accrued but unpaid interest, if any, to, but not including, the redemption date, as described under "Description of Notes Optional Redemption." No Financial Covenants The indenture relating to the Notes does not contain financial covenants. See "Risk Factors Risks Related to this Offering The indenture does not contain financial covenants and does not limit the amount of indebtedness that we may incur" and "Description of Notes Certain Covenants." Listing and Trading We intend to apply to list the Notes on the NYSE under the symbol "TANO." If approved, we expect trading in the Notes to begin within 30 days after the original issue date of the Notes. This is an offering of $100,000,000 aggregate principal amount of % Senior Notes due 2029, or the Notes. We will pay interest on the Notes quarterly in arrears on February 28, May 31, August 31 and November 30 of each year, beginning on February 28, 2015. The Notes will mature on December 15, 2029. The Notes will constitute our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future unsecured and unsubordinated indebtedness and will be effectively subordinated to all existing and future secured indebtedness (including all borrowings under our credit facility) to the extent of the value of the assets securing such indebtedness and to all existing and future debt, other liabilities (including deferred rent obligations) and any preferred equity of our subsidiaries. The Notes will be issued in denominations and integral multiples of $25.00. We may, at our option, at any time on or after December 15, 2017, redeem some or all of the Notes by paying 100% of the principal amount of the Notes to be redeemed plus accrued but unpaid interest, if any, to, but not including, the redemption date, as described under "Description of Notes Optional Redemption." The Notes will constitute a new issue of securities with no established trading market. We intend to apply to list the Notes on the New York Stock Exchange, or the NYSE, under the symbol "TANO" and, if approved, expect trading in the Notes to begin within 30 days of the original issue date of the Notes. The Notes are expected to trade "flat," meaning that purchasers will not pay, and sellers will not receive, any accrued and unpaid interest on the Notes that is not reflected in the trading price. Investment in the Notes involves a high degree of risk. You should read carefully the sections entitled "Risk Factors" and "Warning Concerning Forward Looking Statements" beginning on pages 10 and 52, respectively, of this prospectus. Neither the Securities and Exchange Commission, or SEC, nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful and complete. Any representation to the contrary is a criminal offense. Table of Contents Use of Proceeds We estimate that the net proceeds from this offering will be $ million after deducting the underwriting discount and other estimated offering expenses (approximately $ million if the underwriters' overallotment option is exercised in full). We currently intend to use the net proceeds from this offering for general business purposes, including acquisitions and construction of additional travel centers and convenience stores, funding capital improvements to our travel centers and convenience stores and other expansion activities. Trustee U.S. Bank National Association Risk Factors You should carefully consider the information set forth in the section of this prospectus entitled "Risk Factors," as well as the information included in or incorporated by reference in this prospectus before deciding to invest in the Notes. Per Note Total(2) Public offering price(1) $ $ Underwriting discount $ $ Proceeds, before expenses, to us(1)(3) $ $ Table of Contents
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights selected information appearing elsewhere in this prospectus and does not contain all the information you should consider before investing in our common stock. You should carefully read this prospectus in its entirety before investing in our common stock, including the section entitled Risk Factors, and our financial statements and related notes included elsewhere in this prospectus. Our year end is December 31, and our quarters end on March 31, June 30, September 30 and December 31. Our fiscal years ended December 31, 2011, 2012 and 2013 are referred to herein as 2011, 2012 and 2013, respectively. Overview Our goal is simply to help researchers gain a better understanding of proteins and their role in disease. We develop and commercialize proprietary systems and consumables for protein analysis that ultimately help reveal new insights into the true nature of proteins. Proteins are the heart and soul of functional biology and understanding proteins is central to understanding disease. However, proteins are difficult to interrogate because they are large, complex and unique. Our goal is to make protein analysis simpler, more quantitative and affordable. Our comprehensive portfolio of tools includes Simple Western systems that quantify protein expression and Biologics systems that probe the structure and purity of protein-based therapeutics. The most widely used protein analysis technique in existence today is the Western blot, or Western, which detects whether a specific protein is present in a sample. The Western workflow, unchanged since its invention in 1979, requires many manual steps, can take up to 24 hours to complete, and can lead to variable and semi-quantitative results. Despite these challenges, over 850,000 researchers around the world continue to use Western blots in their research and spent $2.2 billion in 2012 on the technique according to a study we commissioned from BioInformatics, LLC. Our Simple Western platform is a truly quantitative Western with none of the hassle. A researcher simply loads his or her sample into a plate, clicks start and comes back in as few as three hours to fully-analyzed, quantitative data. Our Simple Western automates the entire assay workflow and transforms the Western into an analytical tool, enabling researchers to determine quantitatively how much of a specific protein exists in a given sample. We have sold more than 330 Simple Western systems to more than 220 customers around the world. Protein-based therapeutics, or biologics, are transforming the pharmaceutical industry and the treatment of many diseases. According to a report from EvaluatePharma, there are currently over 2,000 biologics in various stages of clinical development. The development and production of biologics requires a variety of analytical tools to ensure the quality and efficacy of these complex drugs. Our Biologics tools help researchers analyze protein purity and identify contaminants during biologics development and production. We estimate that researchers spend approximately $330 million on an annual basis measuring these biologics attributes. We have two platforms in our Biologics tools portfolio, iCE and Micro-Flow Imaging, or MFI. Our iCE platform allows researchers to interrogate the identity and purity of biologics and global regulators require measurement of these attributes. Our MFI system allows researchers to image and measure particles and protein aggregates in biologics. Manufacturers must monitor particles and aggregates due to regulators concerns about their impact on patient safety. We have sold more than 950 of our Biologics systems to over 220 customers around the world. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED , 2014 PRELIMINARY PROSPECTUS shares Common Stock This is the initial public offering of shares of common stock of ProteinSimple. Prior to this offering, there has been no public market for our common stock. We are offering shares of our common stock. We have applied to list our common stock on the NASDAQ Global Select Market under the symbol PRTN. We are an emerging growth company, as that term is used in the Jumpstart Our Business Startups Act of 2012 and, as such, may elect to comply with reduced U.S. public company reporting requirements for future filings. Investing in our common stock involves a high degree of risk. See Risk Factors beginning on page 10. Per share Total Initial public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds to ProteinSimple, before expenses $ $ (1) See Underwriting for a description of the compensation payable to the underwriters. The underwriters have an option to buy up to additional shares of common stock from us at the public offering price, less the underwriting discounts and commissions, to cover over-allotment of shares, if any. The underwriters can exercise this option at any time within 30 days from the date of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares of common stock to purchasers on or about , 2014. J.P. Morgan BofA Merrill Lynch Cowen and Company Leerink Partners , 2014 Table of Contents We sell our products to biopharma, academic and government researchers primarily through a direct sales force in North America, Europe, Japan and China and through distributors and subdealers in select markets. We grew our revenue from $33.8 million in 2011 to $40.3 million in 2012 and $51.1 million in 2013. In 2013, approximately 92% of our revenue came from our direct selling efforts, 85% of our revenue came from biopharma customers and 43% of our revenue came from outside the United States. Our gross margins expanded from 58.8% in 2011 to 62.6% in 2012 and 67.3% in 2013. We incurred net losses of $11.2 million and $4.4 million in 2011 and 2012, respectively, and generated net income of $1.0 million in 2013. During the three months ended March 31, 2014 our revenue was $13.1 million, a 26% increase over the same period in 2013, while our gross margin expanded to 67.7% from 65.7%. We recorded a net loss of $0.1 million for the three months ended March 31, 2014, compared with a net loss of $1.0 million for the three months ended March 31, 2013. We attribute our success to the following: Protein focus: Our unique protein-focused strategy has provided us with a deep understanding of the challenges faced by protein researchers and allowed us to develop proprietary tools that improve traditional techniques. Proven new product development capabilities: We have a robust product development process and team that has delivered 14 new systems in just over four years. The Simple Western is a disruptive technology: We are the first and only company to fully automate the Western, transforming it into a simple, fast, quantitative tool that addresses a significant customer need in a large established market. Mission critical Biologics tools: Our Biologics products are robust, application-specific solutions that are necessary to address requirements of both global regulators and biologics developers. Deep and broad customer relationships: We have sold nearly 1,300 systems to over 400 customers globally across our Simple Western and Biologics product lines. Through our direct selling efforts, we have established deep customer relationships and insights that influence our product development and commercialization strategies. Highly diversified and recurring revenues: Our revenue base includes an attractive mix of systems and consumables from multiple product families across a broad and geographically diverse customer base. Our Strategy Our goal is to build the largest protein analysis pure play in the life science tools sector. Our strategy includes the following elements: Drive awareness and adoption of the Simple Western to establish it as the global standard. We plan to further educate the worldwide research community on the numerous advantages of the Simple Western system. In doing so, we believe our Simple Western products have the ability to become the Western blotting standard. Expand our Biologics tools product portfolio and markets served. We believe that there are a wide variety of analytical challenges that we can address by expanding our Biologics portfolio in this important, growing market. Continue to deliver new products that address researchers protein analysis challenges. We believe we have a core competency in new product development and we intend to continue to search out and solve protein analysis problems where they exist. Expand our direct distribution capabilities around the world. Our current geographic footprint is modest compared to the worldwide market opportunity for our products and we have limited presence in some key geographic markets such as Europe and Asia. Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+Item 3 Prospectus Summary We qualify all the forward-looking statements contained in this Prospectus by the following cautionary statements. This Prospectus, and any supplement to this Prospectus include forward-looking statements . To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as intends , anticipates , believes , estimates , projects , forecasts , expects , plans and proposes . Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the Risk Factors section beginning on page 9 of this Prospectus and the Management s Discussion and Analysis of Financial Position and Results of Operations section elsewhere in this Prospectus. Actual results may vary from those expected. Undue reliance should not be placed on any forward-looking statements, which are appropriate only for the date made. We do not plan to subsequently revise these forward-looking statements to reflect current circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. Corporate Background We were incorporated on May 30, 2007 under the laws of the State of Nevada. We are a corporation engaged in enhanced oil and gas recovery solutions and services. We have one subsidiary, Falconridge Oil Ltd. ( Falconridge Ontario ), a province of Ontario company, which has become our wholly-owned subsidiary on August 2, 2013 upon the closing of the transactions discussed below. Our principal executive offices are located at 17-120 West Beaver Creek Rd., Richmond Hill, Ontario, Canada L4B 1L2. Our telephone number is (905) 771-6551. The Offering The 19,461,000 shares of our common stock being registered by this Prospectus represent approximately 39.7% of our issued and outstanding common stock as of August 21, 2014. We have not entered into any registration rights or similar agreement pursuant to which we are obligated to register the shares being registered in this Prospectus. We are a reporting company with the SEC. We are bearing all costs associated with registering the shares being offered because we believe that we will be better able to raise the required funds. Importantly, however, there is no guarantee that a market for our shares will ever develop. Common Stock Outstanding Prior to the Offering 49,016,667 shares Common Stock to be Outstanding Following the Offering 49,016,667 shares Common Stock Offered 19,461,000 shares Offering Price $0.50 per share Aggregate Offering Price $9,730,500 Number of Selling Security Holders 20 Use of Proceeds We will not receive any of the proceeds of the shares offered by the Selling Security Holders. Our company will pay all the expenses of this offering estimated at approximately $17,500. Underwriters The Selling Security Holders are underwriters, within the meaning of section 2(a)(11) of the Securities Act. Plan of Distribution The Selling Security Holders named in this Prospectus are making this offering and may sell at market or privately negotiated prices. This summary does not contain all the information that should be considered before making an investment in Falconridge Oil Technologies Corp. s common stock. The entire prospectus should be read including the Risk Factors on page 9 and financial statements before deciding to invest in our common stock. Financial Summary Information All references to currency in this Prospectus are to U.S. Dollars, unless otherwise noted. The following table sets forth selected financial information, which should be read in conjunction with the information set forth in the Management s Discussion and Analysis of Financial Position and Results of Operations section and the accompanying financial statements and related notes included elsewhere in this Prospectus. Income Statement Data May 31, 2014 (Unaudited) Year Ended February 28, 2013 (Falconridge Ontario) (audited) Year Ended February 28, 2014 (Falconridge Ontario) (audited) Revenues $ 6,323 $ 63,635 $ 19,029 Operating Expenses $ 61,216 $ 415,554 $ 474,608 Net Income (Loss) $ (56,893 ) $ (353,041 ) $ (457,476 ) Net Earnings (Loss) Per Share $ (0.00 ) $ (0.01 ) $ (0.01 ) Balance Sheet Data As at May 31, 2014 (Unaudited) As at February 28, 2013 (audited) As at February 28, 2014 (audited) Working Capital (Deficit) $ (1,734,116 ) $ (1,279,973 ) $ (1,680,414 ) Total Assets $ 414,152 $ 197,602 $ 435,006 Total Liabilities $ 1,755,130 $ 1,343,789 $ 1,719,091 RISK FACTORS An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below, together with all of the other information included in this report, before making an investment decision. If any of the following risks actually occurs, our business, financial condition or results of operations could suffer. In that case, the trading price of our common stock could decline, and you may lose all or part of your investment. You should read the section entitled Special Note Regarding Forward Looking Statements above for a discussion of what types of statements are forward-looking statements, as well as the significance of such statements in the context of this report. RISKS RELATED TO OUR BUSINESS You should carefully consider the risks described below together with all of the other information included in this report before making an investment decision with regard to our securities. The statements contained in or incorporated into this registration statement that are not historic facts are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by forward-looking statements. If any of the following risks actually occur, our business, financial condition or results of operations could be harmed. In that case, the trading price of our common stock could decline, and you may lose all or part of your investment. PROSPECTUS FALCONRIDGE OIL TECHNOLOGIES CORP. 19,461,000 Shares of Common Stock The date of this Prospectus is September 16 , 2014. Falconridge Oil Technologies Corp. ( Falconridge , we , us , our and our company ) is registering 19,461,000 shares of common stock held by 20 selling security holders (the Selling Security Holders ). Our common stock is quoted on the OTC Bulletin Board (the OTCBB ) under the trading symbol FROT . From July 8, 2013 to August 21, 2014, there have only been 23 days of active trading of our common stock on the OTCBB. We cannot assure you that there will be an active market in the future for our common stock. The Selling Security Holders have the option to sell their shares at an initial price of $0.50 per share until an active market for our common stock develops on the OTCBB, and thereafter at prevailing market prices or privately negotiated prices. The Selling Security Holders have arbitrarily set the $0.50 price per share; the price does not reflect net worth, total asset value, or any other objective accounting measure. The Selling Security Holders are underwriters, within the meaning of section 2(a)(11) of the Securities Act. Any broker-dealers or agents that participate in the sale of the common stock or interests therein may also be deemed to be an underwriter within the meaning of section 2(a)(11) of the Securities Act. Any discounts, commissions, concessions or profit earned on any resale of the shares may be underwriting discounts and commissions under the Securities Act. We will not receive any proceeds from the sale of shares of our common stock by the Selling Security Holders, who will receive aggregate net proceeds of $9,730,500 if all of the shares being registered are sold. We will incur all costs associated with this Prospectus. Our four directors and officers are: Mr. William J. Muran as Director; Mr. Mark Pellicane, as Director, President and Chief Executive Officer; Mr. Alfred Vincent Morra as Director, Treasurer and Chief Financial Officer; and Mr. Carl Meaney as Director. Our common stock is presently not traded on any national securities exchange or the NASDAQ stock market. We do not intend to apply for listing on any national securities exchange or the NASDAQ stock market. The purchasers in this offering may be receiving an illiquid security. An investment in our securities is speculative. See the section entitled Risk Factors beginning on page 5 of this Prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this Prospectus. Any representation to the contrary is a criminal offense. The information in this Prospectus is not complete and may be changed. The Selling Security Holders may not sell these securities until this registration statement is declared effective by the Securities and Exchange Commission. This Prospectus shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall the Selling Security Holders sell any of these securities in any state where such an offer or solicitation would be unlawful before registration or qualification under such state s securities laws. You should rely only on the information contained in this Prospectus. We have not authorized anyone to provide you with information different from that contained in this Prospectus. The Selling Share Holders are offering to sell, and seeking offers to buy, their common shares, only in jurisdictions where offers and sales are permitted. The information contained in this Prospectus is accurate only as of the date of this Prospectus, regardless of the time of delivery of this Prospectus or of any sale of our common shares. Dealer Prospectus Delivery Obligation Until _________ (90th day after the later of (1) the effective date of the registration statement; or (2) the first date on which the securities are offered publicly), all dealers that effect in transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. The date of this Prospectus is , 2014. We have a limited operating history with significant losses and expect losses to continue for the foreseeable future. We have yet to establish any history of profitable operations and we have incurred net losses of $56,893 and $131,737 for the three month periods ended May 31, 2014 and 2013, respectively. In addition, we have an accumulated deficit of $1,660,656 and a working capital deficit of $1,734,116 as of May 31, 2014. Our business operations began in 2010 and have resulted in net losses in each year. We have generated only nominal revenues since our inception and do not anticipate that we will generate revenues which will be sufficient to sustain our operations in the near future. Our profitability will require the successful commercialization and sales of our planned products. We may not be able to successfully achieve any of these requirements or ever become profitable. There is doubt about our ability to continue as a going concern due to recurring losses from operations, accumulated deficit and insufficient cash resources to meet our business objectives, all of which means that we may not be able to continue operations. Our independent auditors have added an explanatory paragraph to their audit opinion issued in connection with the financial statements for the years ended February 28, 2013 and February 28, 2014 with respect to their doubt about our ability to continue as a going concern. As discussed in Note 3 to our financial statements for the years ended February 28, 2013 and February 28, 2014, we have generated operating losses since inception, and our cash resources are insufficient to meet our planned business objectives, which together raises doubt about our ability to continue as a going concern. We could face intense competition, which could result in lower revenues and higher expenditures and could adversely affect our results of operations. Unless we keep pace with changing technologies, we could lose existing customers and fail to win new customers. In order to compete effectively in the enhanced oil and gas recovery industry, we must continually design, develop implement and market new and enhanced technologies and strategies. Our future success will depend, in part, upon our ability to address the changing and sophisticated needs of the marketplace. Enhanced oil and gas recovery technologies have not achieved widespread commercial acceptance in Canada and our strategy of expanding our enhanced oil and gas recovery business could adversely affect our business operations and financial condition. Further, we expect to derive over a significant amount of revenue from oil and gas assets, which are often non-standard, involve competitive bidding, and may produce volatility in earnings and revenue. Our plan to pursue oil and gas assets in international markets may be limited by risks related to conditions in such markets. We are governed by only four persons serving as directors and officers which may lead to faulty corporate governance. We have not implemented various corporate governance measures nor have we adopted any independent committees as we presently do not have any independent directors. We must attract and maintain key personnel or our business will fail. Success depends on the acquisition of key personnel. We will have to compete with other companies both within and outside the oil and gas industry to recruit and retain competent employees. If we cannot maintain qualified employees to meet the needs of our anticipated growth, this could have a material adverse effect on our business and financial condition. We may not be able to secure additional financing to meet our future capital needs due to changes in general economic conditions. We anticipate requiring significant capital to fulfill our contractual obligations (as noted in our audited financial statements), continue development of our planned products to meet market evolution, and execute our business plan, generally. We may use capital more rapidly than currently anticipated and incur higher operating expenses than currently expected, and we may be required to depend on external financing to satisfy our operating and capital needs. We may need new or additional financing in the future to conduct our operations or expand our business. Any sustained weakness in the general economic conditions and/or financial markets in the United States or globally could adversely affect our ability to raise capital on favorable terms or at all. From time to time we have relied, and may also rely in the future, on access to financial markets as a source of liquidity to satisfy working capital requirements and for general corporate purposes. We may be unable to secure debt or equity financing on terms acceptable to us, or at all, at the time when we need such funding. If we do raise funds by issuing additional equity or convertible debt securities, the ownership percentages of existing stockholders would be reduced, and the securities that we issue may have rights, preferences or privileges senior to those of the holders of our common stock or may be issued at a discount to the market price of our common stock which would result in dilution to our existing stockholders. If we raise additional funds by issuing debt, we may be subject to debt covenants, which could place limitations on our operations including our ability to declare and pay dividends. Our inability to raise additional funds on a timely basis would make it difficult for us to achieve our business objectives and would have a negative impact on our business, financial condition and results of operations. Our business and operating results could be harmed if we fail to manage our growth or change. Our business may experience periods of rapid change and/or growth that could place significant demands on our personnel and financial resources. To manage possible growth and change, we must continue to try to locate skilled professionals in the oil and gas industry and adequate funds in a timely manner. We have a limited operating history and if we are not successful in continuing to grow our business, then we may have to scale back or even cease our ongoing business operations. We have achieved some revenues and have limited significant tangible assets. There can be no assurance that we will ever operate profitably. We have a limited operating history. Our success is significantly dependent on the successful marketing and implementation of our Terra Slicing Technology ( TST ) service, which cannot be guaranteed. Our operations will be subject to all the risks inherent in the uncertainties arising from the absence of a significant operating history. We may be unable to complete the marketing and implementation of our TST service and operate on a profitable basis. Potential investors should be aware of the difficulties normally encountered by enterprises in the early stages. If our business plan is not successful, and we are not able to operate profitably, investors may lose some or all of their investment in our company. We are affected by certain law and governmental regulations which could affect international operations of our oil and gas assets. While our TST service has been approved in certain countries, failure to gain compliance would limit international operations. In addition, future government regulations concerning environmental issues could have an adverse effect on market acceptance or cause time delays or additional costs to meet requirements. To the best of our knowledge, there are no laws or governmental regulations which would prohibit the use of TST in our target countries (ie. United Arab Emirates, Oman, Egypt or Brazil). Use of our technology is only subject to local operator/owner approval. Where we may be restricted as to the introduction of our technology in foreign countries relates only to local governmental regulations which may require the establishment of a corporate entity in the subject country, of which we may decide against due to costs and lack of corporate control of that new entity. If our intellectual property is not adequately protected, then we may not be able to compete effectively and we may not be profitable. Our commercial success may depend, in part, on obtaining and maintaining patent protection, trade secret protection and regulatory protection of our technologies and product candidates as well as successfully defending third-party challenges to such technologies and candidates. We will be able to protect our technologies and product candidates from use by third parties only to the extent that valid and enforceable patents, trade secrets or regulatory protection cover them and we have exclusive rights to use them. The ability of our licensors, collaborators and suppliers to maintain their patent rights against third-party challenges to their validity, scope or enforceability will also play an important role in determining our future. The patent positions of technology related companies can be highly uncertain and involve complex legal and factual questions that include unresolved principles and issues. No consistent policy regarding the breadth of claims allowed regarding such companies patents has emerged to date in the United States, and the patent situation outside the United States is even more uncertain. Changes in either the patent laws or in interpretations of patent laws in the United States or other countries may diminish the value of our intellectual property. Accordingly, we cannot predict with any certainty the range of claims that may be allowed or enforced concerning our patents. We may also rely on trade secrets to protect our technologies, especially where we do not believe patent protection is appropriate or obtainable. However, trade secrets are difficult to protect. While we seek to protect confidential information, in part, through confidentiality agreements with our consultants and scientific and other advisors, they may unintentionally or willfully disclose our information to competitors. Enforcing a claim against a third party related to the illegal acquisition and use of trade secrets can be expensive and time consuming, and the outcome is often unpredictable. If we are not able to maintain patent or trade secret protection on our technologies and product candidates, then we may not be able to exclude competitors from developing or marketing competing products, and we may not be able to operate profitability. If we are the subject of an intellectual property infringement claim, the cost of participating in any litigation could cause us to go out of business. There has been, and we believe that there will continue to be, significant litigation and demands for licenses in our industry regarding patent and other intellectual property rights. Although we anticipate having a valid defense to any allegation that our current products, production methods and other activities infringe the valid and enforceable intellectual property rights of any third parties, we cannot be certain that a third party will not challenge our position in the future. Other parties may own patent rights that we might infringe with our products or other activities, and our competitors or other patent holders may assert that our products and the methods we employ are covered by their patents. These parties could bring claims against us that would cause us to incur substantial litigation expenses and, if successful, may require us to pay substantial damages. Some of our potential competitors may be better able to sustain the costs of complex patent litigation, and depending on the circumstances, we could be forced to stop or delay our research, development, manufacturing or sales activities. Any of these costs could cause us to go out of business. We could lose our competitive advantages if we are not able to protect any TST and intellectual property rights against infringement, and any related litigation could be time-consuming and costly. Our success and ability to compete depends to a significant degree on our license to use TST which is renewed every year by mutual consent and signature and unless there is thirty days of notice by either party. If any of our competitor s copies or otherwise gains access to TST or develops similar technologies independently, we would not be able to compete as effectively. We also consider our trademarks invaluable to our ability to continue to develop and maintain the goodwill and recognition associated with our brand. These and any other measures that we may take to protect our intellectual property rights, which presently are based upon a combination of copyright, trade secret and trademark laws, may not be adequate to prevent their unauthorized use. Further, the laws of foreign countries may provide inadequate protection of such intellectual property rights. We may need to bring legal claims to enforce or protect such intellectual property rights. Any litigation, whether successful or unsuccessful, could result in substantial costs and diversions of resources. In addition, notwithstanding any rights we have secured in our intellectual property, other persons may bring claims against us that we have infringed on their intellectual property rights, including claims based upon the content we license from third parties or claims that our intellectual property right interests are not valid. Any claims against us, with or without merit, could be time consuming and costly to defend or litigate, divert our attention and resources, result in the loss of goodwill associated with our service marks or require us to make changes to our website or other of our technologies. If we fail to effectively manage our growth our future business results could be harmed and our managerial and operational resources may be strained. As we proceed with the commercialization of our technology, we expect to experience significant and rapid growth in the scope and complexity of our business. We will need to add staff to market our services, manage operations, handle sales and marketing efforts and perform finance and accounting functions. We will be required to hire a broad range of additional personnel in order to successfully advance our operations. This growth is likely to place a strain on our management and operational resources. The failure to develop and implement effective systems, or to hire and retain sufficient personnel for the performance of all of the functions necessary to effectively service and manage our potential business, or the failure to manage growth effectively, could have a materially adverse effect on our business and financial condition. Our services may become obsolete and unmarketable if we are unable to respond adequately to rapidly changing technology and customer demands. Our industry is characterized by rapid changes in technology and market demands. As a result, our service and technology may quickly become obsolete and unmarketable. Our future success will depend on our ability to adapt to technological advances, anticipate market demands, develop new products and enhance our current products on a timely and cost-effective basis. Further, our products must remain competitive with those of other companies with substantially greater resources. We may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, we may not be able to adapt new or enhanced services to emerging industry or governmental standards. Risks Relating to Ownership of Our Securities Our stock price may be volatile, which may result in losses to our shareholders. The stock markets have experienced significant price and trading volume fluctuations, and the market prices of companies listed on the OTCBB quotation system in which shares of our common stock are listed, have been volatile in the past and have experienced sharp share price and trading volume changes. The trading price of our common stock is likely to be volatile and could fluctuate widely in response to many factors, including the following, some of which are beyond our control: variations in our operating results; changes in expectations of our future financial performance, including financial estimates by securities analysts and investors; changes in operating and stock price performance of other companies in our industry; additions or departures of key personnel; and future sales of our common stock. Domestic and international stock markets often experience significant price and volume fluctuations. These fluctuations, as well as general economic and political conditions unrelated to our performance, may adversely affect the price of our common stock. Our common shares may become thinly traded and you may be unable to sell at or near ask prices, or at all. We cannot predict the extent to which an active public market for trading our common stock will be sustained. The trading volume of our common shares has historically been sporadically or thinly-traded meaning that the number of persons interested in purchasing our common shares at or near bid prices at certain given time may be relatively small or non-existent. This situation is attributable to a number of factors, including the fact that we are a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community who generate or influence sales volume. Even if we came to the attention of such persons, those persons tend to be risk-averse and may be reluctant to follow, purchase, or recommend the purchase of shares of an unproven company such as ours until such time as we become more seasoned and viable. As a consequence, there may be periods of several days or more when trading activity in our shares is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price. We cannot give you any assurance that a broader or more active public trading market for our common stock will develop or be sustained, or that current trading levels will be sustained. The market price for our common stock is particularly volatile given our status as a relatively small company, which could lead to wide fluctuations in our share price. You may be unable to sell your common stock at or above your purchase price if at all, which may result in substantial losses to you. Shareholders should be aware that, according to SEC Release No. 34-29093, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (1) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (2) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (3) boiler room practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive and undisclosed bid-ask differential and markups by selling broker-dealers; and (5) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses. Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to our securities. The occurrence of these patterns or practices could increase the volatility of our share price. We do not anticipate paying any cash dividends to our common shareholders. We presently do not anticipate that we will pay dividends on any of our common stock in the foreseeable future. If payment of dividends does occur at some point in the future, it would be contingent upon our revenues and earnings, if any, capital requirements, and general financial condition. The payment of any common stock dividends will be within the discretion of our Board of Directors. We presently intend to retain all earnings to implement our business plan; accordingly, we do not anticipate the declaration of any dividends for common stock in the foreseeable future. As we are listed on the Over-the-Counter Bulletin Board quotation system, our common stock is subject to penny stock rules which could negatively impact our liquidity and our shareholders ability to sell their shares. Our common stock is currently quoted on the OTCBB. We must comply with numerous NASDAQ MarketPlace rules in order to maintain the listing of our common stock on the OTCBB. There can be no assurance that we can continue to meet the requirements to maintain the quotation on the OTCBB listing of our common stock. If we are unable to maintain our listing on the OTCBB, the market liquidity of our common stock may be severely limited. Volatility in our common share price may subject us to securities litigation. The market for our common stock is characterized by significant price volatility as compared to seasoned issuers, and we expect that our share price will continue to be more volatile than a seasoned issuer for the indefinite future. In the past, plaintiffs have often initiated securities class action litigation against a company following periods of volatility in the market price of its securities. We may, in the future, be the target of similar litigation. Securities litigation could result in substantial costs and liabilities and could divert management s attention and resources. The elimination of monetary liability against our directors, officers and employees under Nevada law and the existence of indemnification rights of our directors, officers and employees may result in substantial expenditures by our company and may discourage lawsuits against our directors, officers and employees. Our Articles of Incorporation contains a specific provision that eliminates the liability of our directors and officers for monetary damages to our company and shareholders. Further, we are prepared to give such indemnification to our directors and officers to the extent provided for by Nevada law. We may also have contractual indemnification obligations under our employment agreements with our officers. The foregoing indemnification obligations could result in our company incurring substantial expenditures to cover the cost of settlement or damage awards against directors and officers, which we may be unable to recoup. These provisions and resultant costs may also discourage our company from bringing a lawsuit against directors and officers for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our shareholders against our directors and officers even though such actions, if successful, might otherwise benefit our company and shareholders. Our business is subject to changing regulations related to corporate governance and public disclosure that have increased both our costs and the risk of noncompliance. Because our common stock is publicly traded, we are subject to certain rules and regulations of federal, state and financial market exchange entities charged with the protection of investors and the oversight of companies whose securities are publicly traded. These entities, including the Public Company Accounting Oversight Board, the SEC and the Financial Industry Regulatory Authority ( FINRA ), have issued requirements and regulations and continue to develop additional regulations and requirements in response to corporate scandals and laws enacted by Congress, most notably the Sarbanes-Oxley Act of 2002. Our efforts to comply with these regulations have resulted in, and are likely to continue resulting in, increased general and administrative expenses and diversion of management time and attention from revenue-generating activities to compliance activities. Because new and modified laws, regulations and standards are subject to varying interpretations in many cases due to their lack of specificity, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This evolution may result in continuing uncertainty regarding compliance matters and additional costs necessitated by ongoing revisions to our disclosure and governance practices. We will incur increased costs and compliance risks as a public company. As a public company, we will incur significant legal, accounting and other expenses that Falconridge Ontario did not incur as a private company prior to the private placement financing and share exchange. Our business will incur costs associated with our public company reporting requirements. We also anticipate that we will incur costs associated with recently adopted corporate governance requirements, including certain requirements under the Sarbanes-Oxley Act of 2002, as well as new rules implemented by the SEC and FINRA. We expect these rules and regulations, in particular Section 404 of the Sarbanes-Oxley Act of 2002, to significantly increase our legal and financial compliance costs and to make some activities more time-consuming and costly. Like many smaller public companies, we face a significant impact from required compliance with Section 404 of the Sarbanes-Oxley Act of 2002. Section 404 requires management of public companies to evaluate the effectiveness of internal control over financial reporting. The SEC has adopted rules implementing Section 404 for public companies as well as disclosure requirements. We are currently preparing for compliance with Section 404; however, there can be no assurance that we will be able to effectively meet all of the requirements of Section 404 as currently known to us in the currently mandated timeframe. Any failure to implement effectively new or improved internal controls, or to resolve difficulties encountered in their implementation, could harm our operating results, cause us to fail to meet reporting obligations or result in management being required to give a qualified assessment of our internal controls over financial reporting. Any such result could cause investors to lose confidence in our reported financial information, which could have a material adverse effect on our stock price. We also expect these new rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our Board of Directors or as executive officers. We are currently evaluating and monitoring developments with respect to these new rules, and we cannot predict or estimate the amount of additional costs we may incur or the timing of such costs.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001407343_tap_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001407343_tap_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..04b10c475a39d4a715efd985cb0e745a9ad48a9a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001407343_tap_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY As used in this prospectus, references to the Company, we, our , us or Tap Resources refer to Tap Resources, Inc. unless the context otherwise indicated. The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the Risk Factors section, the financial statements, and the notes to the financial statements. OUR COMPANY Tap Resources, Inc. was incorporated on November 1, 2006, under the laws of the State of Nevada, for the purpose of conducting mineral exploration activities. We are an exploration stage company, with a mining exploration project (the Marowijne Project ) in the Republic of Suriname that has not realized any revenues to date, and our accumulated net loss as of May 31, 2013 is $24,126. On September 12, 2012, the Company entered into a Share Exchange Agreement (the Share Exchange Agreement ) with selling stockholders named in this prospectus, pursuant to which the Company offered and sold an aggregate of 90,000,000 shares of common stock to all the stockholders of Infinity Resources, Inc., a Nevada corporation ( Infinity ), on a pro rata basis based upon their respective beneficial ownership interest in Infinity Resources, as consideration for all of the issued and outstanding shares of common stock of Infinity held by all the stockholders of Infinity. As a result of the consummation of the Share Exchange Agreement (i) Infinity became a wholly-owned subsidiary of the Company, and the mineral exploration business of Infinity is now the primary business of the Company, and (ii) the stockholders of Infinity immediately prior to the consummation of the Share Exchange Agreement now hold approximately 99.6% of the shares of common stock of the Company. Our current cash of $969 will not be sufficient to operate our company for any period of time from the date of this prospectus or complete the second phase or third phase of our planned exploration program on the Marowijne Project. None of our officers or our director have ever visited the Marowijne Property. Phase 1 and only part of Phase 2 of our exploration program have been completed. In Phase 1 of our plan of operation, we hired a registered geologist and began preliminary N.I. 43-101 exploration. This work was performed primarily between January 2012 and August 2012, at a cost of approximately $104,128 and was paid for by a shareholder of the Company. Phase 2 of our plan of operation was to retain Contract Terraquest Ltd, and hire local contractors for ground work. This work was completed preformed between August 2012 and October 2012, at a cost of approximately $41,136 and was paid for by a shareholder of the Company. The next goals in Phase 2 will be to find a reasonable drill target. We estimate spending an additional $210,000 to complete Phase 2. Phase 3 of our plan of operation will be to diamond drill test on the Marowijne Property. We expect this phase to cost approximately $1,000,000. We will require additional funding to proceed with phase 3 work on the claim; we have no current plans on how to raise the additional funding. We have not commenced work on Phase 3 of our exploration program, which we expect to cost approximately $1,000,000 to complete. We are an exploration stage company formed for the purposes of acquiring, exploring, and if warranted and feasible, developing natural resource property. We have raised an aggregate of $31,200 through private placements of our securities. Proceeds from these placements were used to acquire a mineral property and for working capital. The concession of the Marowijne Property, located in Suriname, consists of approximately 7,008 hectares located west and adjacent to the Marowijne River, and north to the concession of Surgold-Newmont. From Paramaribo, access to the concessions is by truck or bus using the asphalt road all the way towards Moengo City. At this point, an all weathered laterite dirt road better known as the Patamacca road leads south wards all the way to Snesie Kondre. The entrance point however is located at one and a half hour from Moengoe at the Patamacca main road at around 47 kilometers distance. We have had a qualified consulting geologist prepare a geological evaluation report on the claim. We intend to conduct exploratory activities on the claim and if feasible, develop the claim. Neither Andrew Aird, our President and Chief Executive officer and a director, nor Ron McIntyre our Secretary, agreed to serve as an officer or director of the Company at least in part due to a plan, agreement or understanding that he and she, respectively, would solicit, participate in, or facilitate the sale of the enterprise to (or a business combination with) a third party looking to obtain or become a public reporting entity, and each of Mr. Aird and Mr. McIntyre also confirms that he and she, respectively, has no such present intention. No agreements, verbal or written, have been made with respect to the sale of the shares in this offering. Andrew Aird, our President and a director, and Ron McIntyre, our Secretary, arbitrarily determined the sale price of $0.05 per share. In coming to their decision, Messrs Aird and McIntyre considered that in the past two years, the Company s shares of common stock have traded three times on virtually no volume. The Company does not believe that shares of its common stock can trade at $0.51 per share on increased volume. When the Company filed its Form S-1, it had nominal assets (less than $1,000 in cash) and liabilities of between $128,000 and $145,000, with 90,280,920 shares of common stock issued and outstanding. The Company s principal offices are located at Freonstraat 29, Parimaribo, Republic of Suriname. THE OFFERING Securities offered: The selling stockholders are offering hereby up to 40,000,000 shares of common stock. Offering price: The selling stockholders will offer and sell their shares of common stock at a price of $0.05 per share on the OTC Bulletin Board, or at prevailing market prices or privately negotiated prices. Shares outstanding prior to offering: 90,280,920 Shares outstanding after offering: 90,280,920 Market for the shares of common stock: Our common stock is quoted on the OTC Bulletin Board under the symbol TAPP. . There is no active trading market for our common stock, and there is no assurance that a trading market will develop, or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale. Use of proceeds: We will not receive any proceeds from the sale of shares by the selling stockholders SUMMARY FINANCIAL INFORMATION The tables and information below are derived from our audited financial statements for the fiscal year ended November 30, 2013 . Our working capital as at November 30, 2013 and March 10, 2014 was ($165,916). November 30, 2013 ($) Financial Summary (Audited) Cash and Deposits 458 Total Assets 458 Total Liabilities 166,374 Total Stockholder s Deficit (165,916 ) Accumulated From April 27, 2012 (Inception) to November 30, 2013 ($) Statement of Operations Total Expenses 46,798 Net Loss for the Period 9,902 Net Loss per Share -
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001409690_tobira_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001409690_tobira_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001409690_tobira_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001413547_writ_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001413547_writ_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..4cc75e8aa52190c6312f1b291d07e4cc6633c3ca
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001413547_writ_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this Prospectus. This summary does not contain all the information that you should consider before investing in the common stock of Writers Group Film Corp. (referred to herein as the Company, Writers Group, we, our, and us ). You should carefully read the entire Prospectus, including Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements before making an investment decision. About Us Writers Group Film Corp (sometimes the "Company") is a Delaware corporation incorporated on March 9, 2007. On February 25, 2011, we acquired all of the outstanding shares of capital stock of Front Row Networks, Inc., a Nevada corporation (sometimes Front Row ) from its shareholders and the Company, through Front Row Networks Inc., is engaged in content creation to produce, acquire and distribute live concerts in three dimensional format ( 3D ) for initial worldwide digital broadcast into digitally-enabled movie theaters and thereafter, licensed to DVD and Blu-Ray retailers, free TV broadcasters, cable and emerging 3D cable channels, and mobile streaming providers. We believe that the licensing of the distribution rights to the live concerts will be the primary source of revenue for the Company. We further believe that we will be able to generate revenue when we present live concerts in 3D, at lower ticket prices, to a worldwide fan base in a cost-effective manner. While the core business of Front Row Networks remains the production, acquisition and distribution of 2D and 3D theatrical event programming, the Company seeks to secure and distribute non-concert alternative theatrical programming, such as animated family content, music-related documentaries, and other gaming content that can be distributed via mobile and internet platforms. It is the Company s strategic goal to acquire the broadest range of rights for exclusive programming, we may finance all or part of the production of our entertainment programs, acquire rights to completed projects, acquire content catalogues, or acquire companies which own or control content catalogues. We believe that we are positioned to benefit from the market growth and increased demand for alternative theatrical content and mobile content, and we intend to continue expansion of our exclusive library content throughout the coming year. On August 27, 2013, Writers Group Film Corp. acquired all issued and outstanding shares of Amiga Games, Inc., a Washington state-based video gaming company. Writers Group Film Corp. acquired Amiga Games through the issuance of 500,000,000 restricted shares of its Common Stock to the shareholders of Amiga Games, in exchange for all issued and outstanding shares of Amiga Games, making Amiga Games a wholly-owned subsidiary of the Company. Amiga Games Inc. licenses classic video game libraries and republishes the most popular titles for smartphones, modern game consoles, PCs, and tablets. Amiga Games leverages the intellectual property of Amiga Inc., and builds on the classic "Amiga" brand and technology to create new revenue from publisher's dormant game libraries. Our executive office is located at 8200 Wilshire Blvd. , Suite 200 in Beverly Hills, California 90211. Our telephone number is 310-461-3737. Our website is located at www.frnetworks.com. The information on our website is not part of this prospectus. Offering Summary Common stock offered by Dutchess, who is the Selling Stockholder 1,127,392,046 shares of common stock. Common stock outstanding before the offering 4,741,853,212 shares of common stock as of November 25, 2013 Common stock outstanding after the offering after giving effect to the issuance of 1,127,392,046 shares to Dutchess pursuant to the Investment Agreement 5,869,245,258 shares of common stock. Offering Price To be determined by the prevailing market price for the shares at the time of sale or negotiated transactions. Use of proceeds We will not receive any of the proceeds from Dutchess sale of the shares of common stock covered by this prospectus. However, we may receive up to $10,000,000 in proceeds from the sale of shares of common stock to Dutchess pursuant to the terms of the Investment Agreement. We anticipate that the net proceeds we receive under the Investment Agreement will be used for elimination of all liabilities, including all convertible debt outstanding, as well as working capital purposes and acquisitions of assets, businesses or operations, if such acquisition opportunities arise. See Use of Proceeds. OTCQB Trading Symbol Our common stock is traded on the OTCQB under the symbol WRIT .
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001414043_friendable_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001414043_friendable_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..92cbd7bdb41655c9d36223d2e04a1a3185022f57
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001414043_friendable_prospectus_summary.txt
@@ -0,0 +1,253 @@
+PROSPECTUS SUMMARY
+
+ 
+
+The information presented is a brief overview
+of the key aspects of the offering. The prospectus summary contains a summary of information contained elsewhere in this prospectus.
+You should carefully read all information in the prospectus, including the financial statements and the notes to the financial
+statements under the Financial Statements section beginning on page F-1 prior to making an investment decision.
+
+ 
+
+Our Corporate History and Background
+
+ 
+
+We were incorporated in the State of Nevada
+on June 5, 2007. Our plan after our inception on June 5, 2007 was to produce user-friendly software that creates interactive digital
+yearbook software for schools and allows them to create and burn their own interactive digital yearbooks on CD/DVD. We produced
+nominal revenues of $4,855 in our early stages as a result of sales efforts undertaken.
+
+ 
+
+Effective June 15, 2011, we completed a merger
+with our subsidiary, Titan Iron Ore Corp., a Nevada corporation, which was incorporated solely to effect a change in our name from
+"Digital Yearbook Inc." to "Titan Iron Ore Corp."
+
+ 
+
+Also effective June 15, 2011, we effected a
+37 to one forward stock split of our authorized and issued and outstanding common and preferred stock. As a result,
+our authorized capital increased from 100,000,000 shares of common stock with a par value of $0.0001 to 3,700,000,000 shares of
+common stock with a par value of $0.0001 of which 5,151,000 shares of common stock outstanding increased to 190,587,000 shares
+of common stock. Subsequently, on June 20, 2011, we issued 2,100,000 common shares pursuant to a private placement unit offering,
+increasing the number of shares of common stock outstanding to 192,687,000.
+
+ 
+
+Effective June 30, 2011 and in connection with
+the entry into an agreement (the "Acquisition Agreement") with J2 Mining Ventures Ltd. ("J2 Mining")
+dated June 13, 2011 and attached as Exhibit 10.1 to our Current Report on Form 8-K filed June 16, 2011, we completed the acquisition
+of a 100% right, title and interest in and to a properties option agreement (the "Option Agreement") from J2 Mining
+with respect to iron ore mineral properties located in Albany County, Wyoming, by way of entering an assignment of mineral property
+option agreement with J2 Mining and Wyomex LLC (the "Assignment Agreement"), whereby our company was assigned
+100% of the right, title and interest in and to the Option Agreement from J2 Mining.
+
+ 
+
+Effective June 30, 2011, and in connection
+with the closing of the Acquisition Agreement, Ohad David, Ruth Navon and Service Merchant Corp. (the "Vendors"), entered
+into an affiliate stock purchase agreement, whereby, among other things, the Vendors surrendered 142,950,000 common shares for
+cancellation.
+
+ 
+
+On February 3, 2014, the Company completed
+a merger with iHookup Social, Inc., a Delaware corporation ("iHookup") pursuant to an Agreement and Plan of Merger
+and Reorganization (the "Merger Agreement") dated January 31, 2014. Pursuant to the Merger Agreement, the Company incorporated
+a new subsidiary called iHookup Operations Corp, a Delaware corporation, which merged with and into iHookup causing the subsidiary s
+separate existence to cease and iHookup to become a wholly-owned subsidiary of the Company. iHookup s stockholders exchanged
+all of their twelve million (12,000,000) shares of outstanding common stock for fifty million (50,000,000) shares of the Company s
+newly designated Series A Preferred Stock. As a result of the transaction, the former iHookup
+stockholders received a controlling interest in the Company.
+
+ 
+
+ -6-
+
+ 
+
+ 
+
+iHookup Social s business is development
+and dissemination of a "proximity based" mobile social media application that facilitates connections between people,
+utilizing the intelligence of GPS and localized recommendations. Going forward, the Company expects to focus on this aspect of
+the business.
+
+ 
+
+Our Business
+
+ 
+
+Introduction – Mobile Dating App 
+
+iHookup is seeking to redefine the way people
+meet, date, discover and socially convey interest in a potential partner. The laws of meeting and dating have shifted, with traditional
+dating and wooing of that prospective mate now taking a back seat to meeting online or through the use of technology. Among various
+social circles, age groups, race, sex – gender and demographic, making connections through online or mobile devices has become
+a dominant part of today s mobile – social lifestyle.
+
+Market Opportunity 
+
+As a whole mobile apps have become an
+extension of the proliferation of technology, and now our interests and desires can be transformed into pocket sized mobile applications.
+Apps create a socially connected experience while continuing to push forward with personal goals to achieve, stay active or on
+the move and ultimately accessible at all times. Mobile dating is one of the fastest growing market segments in mobile, continuing
+to support new users. A common problem faced across all age and demographic profiles, is the lack of time in each day. Easy, accessible
+and user driven technologies are replacing traditional avenues of meeting people by providing yet another way to embrace our "Do
+it all" and "Have it all" mobile - social generation.
+
+Market Size 
+
+The current
+market for mobile dating in the US is over $2 billion (Source: IBIS WORLD). The larger market of mobile applications is projected
+to continue its growth. In 2013, the business of mobile applications doubled in revenue from the previous year. (Source:
+Portio Research). 
+
+Email,
+web browsers, and social networks lead in usage frequency. By far, the largest contributor
+to this number will be app-enabled commerce, supplemented by forecasted revenue from downloads, in-advertising and virtual goods.
+
+Mobile dating apps now
+command more time compared to online dating sites: 8.4 minutes vs. 8.3 minutes. A year ago, people spent more than twice as much
+time on the Internet for dating as they now do on mobile apps. However, mobile app usage has increased dramatically over the last
+year, from 3.7 minutes in June 2010 to 8.4 minutes in June 2011, overtaking online dating time spent on websites [SOURCE THE ABOVE].
+These findings parallel Flurry Analytics recent report that showed, in total, mobile app usage has overtaken desktop ("Internet")
+usage.
+
+In terms of engagement, frequency
+of use is driving growth in time spent per day in mobile dating apps. Last year, the average user opened his or her dating app
+twice per day, a little under two minutes each time. Now the average user opens his or her app over five times a day, but for shorter
+periods of time, about 1.5 minutes per session.
+
+ 
+
+Similarly, the number of people
+using mobile apps vs. the Internet for eDating is growing rapidly.
+
+ 
+
+Based upon the proportion of
+unique users, dating apps are more popular on smartphones than online dating sites are on the Internet. For the Internet, we compared
+unique visitors of online dating sites versus the total number of people using the Internet, which totaled 12% in June 2010 and
+13% in June 2011. For mobile apps, the Company compared unique users of mobile dating apps versus all apps, which yielded 15% in
+June 2010 and 17% in June 2011.
+
+ 
+
+We have also found that the
+number of people using dating apps is growing faster than the number using all apps in every category. In short, dating is a growth
+category and Social Networking even larger. Overall, the number of unique users of all applications continues to increase while
+the number of unique users using mobile / Social apps continues to validate the trend that users are moving away from their computers
+to a more rewarding "mobile" experience.
+
+ -7-
+
+ 
+
+ 
+
+We believe that dating itself
+is inherently local and better served by mobile, and it seems that mobile apps facilitate better engagement throughout the day.
+Today s eDater need not be in front of his or her computer to view potential matches, or to receive or send messages.
+The user s phone is always by his or her side. Our engagement numbers regarding the frequency and session length, described
+above, support this trend.
+
+ 
+
+iOS and Android devices are
+versatile multi-purpose machines that have already significantly impacted the business models of music, games and other Media &
+Entertainment industry categories. And now, within the nexus of mobile-social-local, mobile dating apps appear to be another high
+growth sector. Mobile dating apps are heavily used by both genders.
+
+ 
+
+Similarly, as demonstrated
+above, mobile dating apps are used by multiple generations with the highest use by those aged 25-34 years followed closely by those
+35-54 years of age.
+
+ 
+
+Growth 
+
+ 
+
+In less than two decades, online dating
+soared and is "in the growth phase of its economic life cycle," says an IBISWorld report (April 2014) Though 18- to 29-year-olds
+make up the biggest chunk of users, with 30- to 49-year-olds next in line, demand is expected to increase with users over 50 years
+of age too. More than one-third of Baby Boomers are unmarried, and as more and more migrate to the digital world, the industry
+is beginning to target this unattached and largely underserved market. Nielsen reports that the number of Americans using apps
+or a mobile version of a dating website was 13.7 million in November 2012, more than double the previous year's 5.8 million.
+
+ 
+
+iHookup app – Offering
+
+iHookup allows the user to choose the best
+match for the user at any particular moment. If the user is seeking someone in close proximity, the user can simply choose a search
+of his or her current location, or choose to broaden the search to miles away for that special connection. Should the user choose
+to hang back and flirt, view photo or video galleries, send a virtual gift, search the specifics of that special male or female,
+or just go for it by sending one of iHookups special broadcasts anytime, iHookup has a broad feature set for the user. iHookup
+seeks to solve real human issues by taking into consideration existing habits, individual identity and ultimately user expectations
+(based on search criteria).
+
+ 
+
+OVERVIEW
+
+ 
+
+iHookup Social s business is development
+and dissemination of a "proximity based" mobile social media application that facilitates connections between people,
+utilizing the intelligence of GPS and localized recommendations. Going forward, the Company expects to focus on this aspect of
+the business.
+
+ 
+
+The Company s auditors, Manning Elliott
+LLP, have issued the Company a , ' ': Going Concern statement. The ability of the Company to continue as a going concern
+is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is
+unable to obtain adequate capital, it could be forced to cease development of operations.
+
+ 
+
+The Company plans to continue using a combination
+of this offering and additional fund raising to develop our business plan. The further implementation of our business plan will
+require significant capital. We do not have this capital and as a result, we will require additional financing to develop our operations.
+We may use debt or equity to fund our ongoing operations. There can be no assurance that any financing will be available, and if
+available, will be on terms and conditions acceptable to the Company. If we rely on equity financing, our shareholders will experience
+significant dilution. If we rely on debt financing, we may not be able to satisfy our debt obligations.
+
+ 
+
+The Terms of the Offering
+
+ 
+
+ 
+ Securities Being Offered
+
+ 166,666,668 shares of common stock being registered on behalf of Beaufort (maximum offering).
+
+ 
+
+ -8-
+
+ 
+
+ 
+
+ 
+
+ 
+ Offering Period:
+
+ Until all shares are sold by Beaufort or until 36 months from the date that the registration statement becomes effective, whichever comes first.
+
+ 
+
+ 
+ Risk of Factors:
+
+ The Securities offered hereby involve a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See "
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001416792_relypsa_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001416792_relypsa_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001416792_relypsa_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001419600_flexion_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001419600_flexion_prospectus_summary.txt
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+parts of or incorporated by reference into this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in shares of our common stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere or incorporated by reference into this prospectus. You should read the entire prospectus and the information incorporated herein carefully, especially Risk Factors and our consolidated financial statements and the related notes incorporated by reference into this prospectus, before deciding to buy shares of our common stock. Unless the context requires otherwise, references in this prospectus to Flexion Therapeutics, we, us and our refer to Flexion Therapeutics, Inc. Overview We are a specialty pharmaceutical company focused on the development and commercialization of novel, injectable pain therapies. We are targeting anti-inflammatory and analgesic therapies for the treatment of patients with musculoskeletal conditions, beginning with osteoarthritis, or OA, a type of degenerative arthritis. Our broad and diversified portfolio of product candidates addresses the OA pain treatment spectrum, from moderate to severe pain, and provides us with multiple opportunities to achieve our goal of commercializing novel, targeted pain therapies. Our lead product candidate, FX006, is a first-in-class injectable, sustained-release, intra-articular, or IA, meaning in the joint, steroid treatment for patients with moderate to severe OA pain. FX006 combines a commonly administered steroid, triamcinolone acetonide, or TCA, with poly lactic-co-glycolic acid, referred to as PLGA, to provide sustained therapeutic concentrations in the joint and persistent analgesic effect. We specifically designed FX006 to address the limitations of current IA therapies by providing long-lasting, local analgesia while avoiding systemic side effects, which are effects that occur throughout the body as a result of drug that is released from the site of injection into circulating blood. In a completed Phase 2b dose-ranging clinical trial, FX006 has demonstrated clinically meaningful and significantly better pain relief compared to the current injectable standard of care. In April 2014, we initiated a pivotal Phase 2b clinical trial of FX006 to further identify a safe and well-tolerated dose of FX006 that demonstrates superior pain relief to placebo. On September 16, 2014, the U.S. Food and Drug Administration, or FDA, notified us that it had placed a clinical hold on the FX006 investigational new drug application IND due to a single occurrence of what was then reported as septic arthritis, an infection of the injected knee joint, in a patient in the clinical trial. We subsequently performed testing and investigation requested by the FDA, which demonstrated that the FX006 drug product was not contaminated. This is consistent with the fact that no production batch of FX006 has ever failed sterility testing. On October 28, 2014, we received notification that based on the highly atypical nature of the patient s clinical presentation as it relates to knee joint infection and the patient s subsequent clinical course which was most consistent with rheumatoid arthritis, the principal investigator had changed the initial serious adverse event diagnosis from septic arthritis, possibly related to study drug treatment, to inflammatory arthritis, unrelated to study drug treatment. This information was promptly shared with the FDA. It is assumed that the original, and only, positive synovial fluid culture obtained from this patient was a false positive, which occurs in approximately 5% of such cases. Thus there have been no confirmed diagnoses of septic arthritis and no serious adverse events related to drug treatment among the more than 300 patients treated with FX006 in all clinical trials to date. After reviewing the information we provided in response to the FDA s requests, on December 1, 2014, the FDA notified us that it had lifted the clinical hold on FX006. As a result we immediately resumed recruitment and dosing in the pivotal Phase 2b trial of FX006, and we expect to report top-line data from the trial in the second half of 2015. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject To Completion, Dated December 11, 2014 Preliminary Prospectus 4,200,000 Shares Common Stock Flexion Therapeutics, Inc. We are offering 4,200,000 shares of our common stock. Our common stock is listed on the Nasdaq Global Market under the symbol FLXN . The closing price of our common stock on the Nasdaq Global Market on December 10, 2014, was $18.06 per share. We have granted the underwriters an option to purchase up to 630,000 additional shares of our common stock. Investing in our common stock involves risks. See Risk Factors beginning on page 10. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012, and, as such, we have elected to take advantage of certain reduced reporting requirements for this prospectus and may elect to comply with certain reduced public company reporting requirements for future filings. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Share Total Public Offering Price $ $ Underwriting Discount(1) $ $ Proceeds to Flexion (before expenses) $ $ (1) We refer you to Underwriting beginning on page 109 for additional information regarding underwriting compensation. The underwriters expect to deliver the shares to purchasers on or about December , 2014 through the book-entry facilities of The Depository Trust Company. BMO Capital Markets RBC Capital Markets Needham & Company Janney Montgomery Scott Summer Street Research Partners Table of Contents In 2014, the FDA informed us that it will consider our on-going pivotal Phase 2b trial as one of two pivotal efficacy trials required for registration of a single-dose administration of FX006. In addition, the FDA informed us that a second placebo-controlled pivotal trial would be sufficient to support the filing of a new drug application, or NDA, for single-dose administration of FX006 and that data from a repeat-dose safety trial would not be required. As a result, we plan to initiate a placebo-controlled Phase 3 trial of FX006 in early 2015 and expect to develop and file repeat-dose safety data in a supplemental NDA after an approval and launch of FX006 for single-dose administration. We believe that FX006 has the potential to be a superior front line injectable treatment for OA pain management compared to existing therapies by providing safe, more effective and sustained pain relief to patients. We believe the following attributes make FX006 an attractive development candidate: A first-in-class injectable, IA, sustained-release treatment for patients with moderate to severe OA pain that has demonstrated in clinical trials to date: clinically meaningful and significantly better pain relief compared to the current injectable standard of care, persistent therapeutic concentrations of drug in the joint and durable efficacy, and an attractive safety profile with limited systemic exposures and the potential for fewer side effects. Among the largest analgesic effects seen in OA clinical trials. Strong proprietary position through a combination of patents, trade secrets and proprietary know-how, as well as eligibility for marketing exclusivity. Well-defined Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act, or FDCA, regulatory pathway seeking approval for a novel formulation of the same dose of the already approved immediate-release steroid used by orthopedists and rheumatologists. Familiarity of orthopedists and rheumatologists with IA injections utilizing the same steroid in the same dose. Potential for pharmacoeconomic benefits due to superior efficacy and durability and the potential to delay costly and invasive total joint replacement, also referred to as total joint arthroplasty, or TJA. Our other product candidates include FX007 for post-operative pain and FX005 for the treatment of end-stage OA patients. FX007 is a locally administered TrkA receptor antagonist that is designed to provide persistent relief of post-operative pain, including in patients who have undergone TJA. We are conducting preclinical local toxicology experiments and plan to initiate a proof of concept, or PoC, clinical trial for FX007 following the generation of the preclinical data. FX005 is a sustained-release p38 MAP, or mitogen-activated protein, kinase inhibitor which has both analgesic and anti-inflammatory effects. FX005 successfully completed a Phase 2a PoC clinical trial demonstrating significant pain relief and function improvement. We will continue to evaluate further development of FX005 taking into consideration, among other factors, our available capital resources. We have worldwide commercialization rights to all of our product candidates. We also have an exclusive worldwide license agreement with Southwest Research Institute, or SwRI, with respect to the use of SwRI s proprietary microsphere manufacturing technologies for certain steroids formulated with PLGA, including FX006. We intend to market our products in the United States through our own sales force targeting specialty physicians, including orthopedists and rheumatologists. Outside of the United States, we are exploring selective partnerships with third parties for the development and commercialization of our product candidates. Each of our product candidates and our PLGA formulation technology is protected through a combination of patents, trade secrets and proprietary know-how, and we intend to seek marketing exclusivity for any approved products. Table of Contents OA is a type of degenerative arthritis that is caused by the progressive breakdown and eventual loss of cartilage in one or more joints. Arthritis is the most common cause of disability in the United States and OA is the most common joint disease, affecting 27 million Americans, with numbers expected to grow as a result of aging, obesity and sports injuries. Recent data suggest that OA accounts for over $185 billion of annual healthcare expenditures in the United States, which does not include loss of productivity costs. We estimate that by 2030, 45 million people will have OA. OA commonly affects large weight-bearing joints like the knees and hips, but also occurs in the shoulders, hands, feet and spine. Patients with OA suffer from joint pain, tenderness, stiffness and limited movement. As the disease progresses, it becomes increasingly painful and debilitating, culminating, in many cases, in the need for TJA. Current therapies for OA are suboptimal and, because there is no cure for the disease, controlling pain and delaying surgery are the primary goals for treatment regimens. Oral drugs, such as non-steroidal anti-inflammatory drugs, or NSAIDs, including COX II inhibitors, and Cymbalta, as well as topical NSAIDs, are used to treat early-stage OA pain but have limited effect on pain and, given the amount and frequency of use in OA patients, are associated with serious side effects. For example, NSAIDs have shown increased risk of serious cardiovascular (CV) thrombotic events, myocardial infarction and stroke. Furthermore, this class of drugs can cause serious gastrointestinal (GI) adverse events including bleeding, ulceration and perforation of the stomach or intestines. These serious side effects are particularly worrisome because OA patients often have co-existing medical conditions, including diabetes and hypertension. For patients with moderate to severe OA pain, IA medicines, such as immediate-release steroids and hyaluronic acid, or HA, injected into the joint, are generally considered safe, but leave the joint rapidly and fail to produce or maintain meaningful pain relief. For patients who progress to end-stage OA, physicians prescribe opioids, which in addition to the risk of addiction, have numerous systemic side effects, such as respiratory depression, hypotension and constipation, and cause a higher incidence of falls and fractures in older OA patients. As a result of these suboptimal therapies, many OA patients experience persistent and worsening pain, which often culminates in the decision for TJA, a painful and expensive procedure. Further, because the initial joint replacement wears out over time, the younger the patient is at the time of the joint replacement, the more likely it is that he or she will require repeat surgery in their lifetime. Our projections indicate that by 2030 approximately 23.5 million of the 45 million OA patients will have knee OA. According to IMS Health, each year over four million OA patients in the United States receive IA steroid injection treatments in the knee, hip, shoulder, hand and foot, with over three million of these being knee injections. In 2012, the number of patients that received knee injections of IA steroids increased approximately 12%. We estimate that an additional 1.3 million patients received knee injections of IA HA, which the FDA has approved for use only in the knee. Sales of HA in the United States were approximately $700 million in 2013, the vast majority of which we believe were related to knee therapy. Our clinical trials to date have treated patients with knee OA, which represents the most common joint treated with IA therapies. While worldwide sales of HA injections are approaching $2 billion, recent negative guidance from specialty societies (e.g. the American Academy of Orthopedic Surgeons (AAOS) and the Osteoarthritis Research Society International (OARSI)) may begin to put downward pressure on HA sales. For example, Sanofi Biosurgery, which sells the market leading HA treatment, Synvisc, reported a 7% drop in U.S. net sales during the first-nine months of 2014 when compared to the first nine months of 2013. This could be in part due to the fact that select payer groups have limited reimbursement for the entire class of HA products. Given the limitations of current therapies, we believe FX006, if successfully commercialized, would provide an attractive therapeutic alternative. Clinical trials to date for FX006 have demonstrated clinically meaningful and significantly better pain relief compared to the current injectable standard of care, persistent therapeutic concentrations of drug in the joint and durable efficacy, and an attractive safety profile with limited systemic exposures and the potential for fewer side effects. Table of Contents Our Strategy Our goal is to cost-effectively develop and commercialize novel therapies that will provide safe and substantial analgesia, or pain relief. Initially, we intend to develop a diverse portfolio of product candidates for the treatment of OA and post-operative pain where we believe there are significant unmet needs. The principal elements of our strategy to accomplish this goal are the following: Focus on novel product candidates that provide long-lasting analgesia locally while avoiding systemic side effects. We intend to develop anti-inflammatory and analgesic therapies for the treatment of patients with musculoskeletal conditions, beginning with OA and post-operative pain. Many OA patients will eventually require IA injection therapies to control their pain as the disease progresses. Currently available IA steroids, none of which are formulated for sustained release, leave the joint rapidly and confer pain relief that typically wanes after two to four weeks. Since, by medical practice, steroids are not typically injected more frequently than every three months, patients can experience months of pain during that time. While the benefits of HA injections generally last for a longer period of time than steroid injections, they are only marginally more effective than placebo. As a result, we believe there is a significant unmet medical need for persistent, effective and safe OA pain relief that can be addressed by IA sustained-release injection therapies. We have therefore formulated our IA product candidates, FX006 and FX005, with the goal of achieving effective drug concentrations in the joint for months, while avoiding significant plasma concentrations of drug that have been linked to systemic side effects. FX007 is being developed to treat post-operative pain and is being formulated to remain in the tissues for a sufficient period of time to effectively treat patients experiencing post-operative pain. Mitigate development risk and expedite regulatory timeline to product approval. We seek to mitigate development risk by selecting product candidates with validated mechanisms of action. Each of our product candidates also utilizes a unique mechanism of action for achieving analgesia and/or anti-inflammatory effects, which diversifies development risk across multiple targets. In addition, for FX006 and FX005, our sustained-release technology employs PLGA delivery systems, which are already used in approved sustained-release drug products outside of OA and in approved surgical devices. Because FX006 incorporates an already approved steroid in PLGA, we believe it qualifies for the Section 505(b)(2) NDA pathway under the FDCA which can be an expeditious, cost-effective means to seek product approval, as well as potentially to expand indications for this product candidate. Section 505(b)(2) of the FDCA enables the applicant to rely, in part, on published literature or the FDA s findings of safety and efficacy for an existing product in support of its application. Target multiple points in the OA pain treatment spectrum. To maximize the likelihood of bringing products to market successfully, our product candidates target different elements of the OA treatment continuum. FX006 is targeted for front line IA therapy in patients with moderate to severe OA pain with the potential to replace IA steroids and HA, FX005 is targeted for patients who progress to end-stage disease as an alternative to opioids and FX007 is targeted for patients with post-operative pain, including those undergoing TJAs. Retain commercial rights in the United States and selectively partner outside of the United States. Because IA therapies in the United States are administered by a relatively small number of specialists, particularly orthopedists and rheumatologists, we believe that we can cost-effectively commercialize our product candidates, if approved, with our own specialty sales and marketing organization in the United States, and thereby retain more of the commercial value of these product candidates. In prior years, Genzyme Corp., which has been acquired by Sanofi, supported sales of Synvisc utilizing a sales force of approximately 100 representatives. We believe we can establish an effective U.S. commercial organization with our own specialty sales force of approximately 60 to 100 representatives that target orthopedists and rheumatologists. Outside of the United States, we are exploring selective partnerships with third parties for the development and commercialization of our product candidates. Table of Contents
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information you should consider before investing in our common stock. Investing in our common stock involves a high degree of risk. You should carefully read this entire prospectus, including our financial statements and the related notes included in this prospectus and the information set forth under the headings "Risk factors" and "Management's discussion and analysis of financial condition and results of operations." Unless the context requires otherwise, the terms "Radius," "Company," "we," "us" and "our" refer to Radius Health, Inc. OUR BUSINESS We are a science-driven biopharmaceutical company focused on developing novel differentiated therapeutics for patients with osteoporosis as well as other serious endocrine-mediated diseases. Our lead product candidate is abaloparatide (BA058), a bone anabolic for the treatment of osteoporosis delivered via subcutaneous injection, which we refer to as Abaloparatide-SC. We are currently in Phase 3 development of Abaloparatide-SC and expect to announce top-line data from this study in late 2014. If the results are positive, we plan to submit a new drug application, or NDA, in the United States, and a marketing authorization application, or MAA, in Europe, in mid-2015. We hold worldwide commercialization rights to Abaloparatide-SC, other than in Japan, and with a favorable regulatory outcome, we anticipate our first commercial sales of Abaloparatide-SC will take place in 2016. We are leveraging our investment in Abaloparatide-SC to develop Abaloparatide-TD. We expect this line extension will provide improved patient convenience by enabling administration of abaloparatide through a short-wear-time transdermal patch. We have recently completed a successful Phase 2 proof of concept study of Abaloparatide-TD. Our current clinical product portfolio also includes a novel oral agent, RAD1901, a selective estrogen receptor down-regulator/degrader, or SERD. We are developing RAD1901 at higher doses, for the treatment of breast cancer brain metastases, or BCBM, and intend to advance its development with the initiation of two Phase 1 clinical trials a maximum tolerated dose study that has commenced patient screening, and a Phase 1b clinical trial in BCBM, which is expected to commence in late-2014. At low doses, RAD1901 acts as a selective estrogen-receptor modulator, or SERM. Low-dose RAD1901 has shown efficacy for the treatment of vasomotor symptoms such as hot flashes in a successful Phase 2 proof of concept study. AMENDMENT NO. 5 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents OUR PRODUCT CANDIDATES The following table identifies the product candidates in our current product portfolio, their proposed indication and stage of development: Abaloparatide Abaloparatide is a novel synthetic peptide analog of parathyroid hormone-related protein, or PTHrP, that we are developing as a bone anabolic treatment for osteoporosis. Osteoporosis is a disease that affects nearly 10 million people in the United States, with an additional approximately 43 million people at increased risk for the disease. It is characterized by low bone mass and structural deterioration of bone tissue, which leads to greater fragility and an increase in fracture risk. Anabolic agents, like Forteo (teriparatide), are used to increase bone mineral density, or BMD, and to reduce the risk of fracture. We believe abaloparatide has the potential to increase BMD and bone quality to a greater degree and at a faster rate than other approved drugs for the treatment of osteoporosis. Based upon various published studies, including studies published by Marc C. Hochberg, MD, MPH (2002) and John A. Kanis (2014), we believe that increases in BMD are predictive of reduction in fracture risk. We are developing two formulations of abaloparatide: Abaloparatide-SC is an injectable subcutaneous formulation of abaloparatide. In August 2009, we announced positive Phase 2 data that showed Abaloparatide-SC produced faster and greater BMD increases at the spine and the hip with substantially less hypercalcemia than Forteo (teriparatide), which is the only approved subcutaneous injectable anabolic agent for the treatment of osteoporosis in the United States. A subsequent Phase 2 clinical trial announced in January 2014 also confirmed the results of our first clinical trial by demonstrating that Abaloparatide-SC produces BMD increases from baseline in the spine and hip that are comparable to our earlier Phase 2 clinical trial. In April 2011, we commenced a Phase 3 clinical trial of Abaloparatide-SC. Enrollment was completed in March 2013, and we expect to announce top-line data at the end of the fourth quarter of 2014. Assuming a favorable outcome, we plan to use the results from this Phase 3 clinical trial to support a new drug application, or NDA, with the U.S. Food and Drug Administration, or FDA, and believe we could obtain approval of the NDA in 2016. Abaloparatide-TD is a line extension of Abaloparatide SC in the form of a convenient, short-wear-time (approximately five minutes) transdermal patch. In a recent Phase 2 clinical trial, Abaloparatide-TD RADIUS HEALTH, INC. CONDENSED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT (UNAUDITED, IN THOUSANDS EXCEPT SHARE AMOUNTS) Convertible Preferred Stock Seris B-2 Seris B Series A-1 Series A-2 Series A-3 Series A-4 Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Balance at December 31, 2013 701,235 $ 43,892 939,612 $ 78,737 983,208 $ 93,977 142,227 $ 12,232 3,998 $ 271 Net loss Issuance of preferred stock 448,060 26,152 Accretion of dividends on preferred stock 251 850 1,760 1,841 267 Stock-based compensation expense Balance at March 31, 2014 448,060 $ 26,403 701,235 $ 44,742 939,612 $ 80,497 983,208 $ 95,818 142,227 $ 12,499 3,998 $ 271 Conversion of convertible preferred stock into common stock (448,060 ) (26,403 ) (701,235 ) (44,742 ) (939,612 ) (80,497 ) (983,208 ) (95,818 ) (142,227 ) (12,489 ) (3,998 ) (271 ) Pro forma balance at March 31, 2014 $ $ $ $ $ $ Convertible Preferred Stock Stockholders' Deficit Series A-5 Series A-6 Common Stock Additional Paid-In- Capital Accumulated Deficit Total Stockholders' Deficit Shares Amount Shares Amount Shares Amount Amount Amount Amount Balance at December 31, 2013 6,443 $ 525 496,111 $ 23,168 385,664 $ $ $ (277,301 ) $ (277,301 ) Net loss (14,488 ) (14,488 ) Issuance of preferred stock 186,847 10,109 Accretion of dividends on preferred stock (511 ) (4,458 ) (4,969 ) Stock-based compensation expense 511 511 Balance at March 31, 2014 6,443 $ 525 682,958 $ 33,277 385,664 $ $ $ (296,247 ) $ (296,247 ) Conversion of convertible preferred stock into common stock (6,443 ) (525 ) (682,958 ) (33,277 ) 22,053,235 2 294,030 294,032 Pro forma balance at March 31, 2014 $ $ 22,438,899 $ Radius Health, Inc. (Exact name of registrant as specified in its charter) Delaware 2834 80-0145732 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 201 Broadway, 6th Floor Cambridge, Massachusetts 02139 (617) 551-4700 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Robert E. Ward Chief Executive Officer Radius Health, Inc. 201 Broadway, 6th Floor Cambridge, Massachusetts 02139 (617) 551-4700 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents demonstrated a statistically significant mean percent increase from baseline in BMD as compared to placebo at the lumbar spine and at the hip. These results demonstrated a clear proof of concept by achieving a dose dependent increase in BMD. Following additional formulation development work, we intend to advance an optimized Abaloparatide-TD product in additional clinical studies and to a Phase 3 bridging study and to subsequently submit for approval. We hold worldwide commercialization rights to Abaloparatide-TD technology. On May 9, 2014, we submitted a breakthrough therapy designation request to the FDA for Abaloparatide-SC for the treatment of postmenopausal osteoporosis. Abaloparatide-SC was selected for clinical development on the basis of its demonstrated marked effects on increasing bone mass in non-clinical models. The recently completed analyses of two abaloparatide Phase 2 clinical trials have confirmed these non-clinical results, demonstrating potentially important clinical benefits relative to current anabolic therapies, including faster and greater increases in hip (non-vertebral) and spine (vertebral) BMD. We believe these results could support a breakthrough therapy designation. RAD1901 RAD1901 is a SERD that we believe crosses the blood-brain barrier and that we are evaluating for the treatment of BCBM. RAD1901 has been shown to bind with good selectivity to the estrogen receptor and to have both estrogen-like and estrogen-antagonistic effects in different tissues. In many cancers, hormones, like estrogen, stimulate tumor growth and a desired therapeutic goal is to block this estrogen-dependent growth while inducing apoptosis of the cancer cells. SERDs are an emerging class of endocrine therapies that directly induce estrogen receptor, or ER, degradation, enabling them to remove the estrogen growth signal in ER-dependent tumors without allowing ligand-independent resistance to develop. There is currently only one SERD, Faslodex (fulvestrant), approved for the treatment of hormone-receptor positive metastatic breast cancer; however, for patients with brain metastases (BCBM), there are no approved targeted therapies that cross the blood-brain barrier. We believe there is a significant opportunity for RAD1901 to be the first ER-targeted therapy that crosses the blood-brain barrier to more effectively treat ER-positive BCBM and potentially reduce both intracranial and extracranial BCBM tumors. We intend to commence a Phase 1 maximum tolerated dose study in healthy volunteers to evaluate the tolerability, safety and pharmacokinetics of RAD1901, and also use 18F-fluroestradiol positron emission tomography (PET) in this study to provide a pharmacodynamic assessment of estrogen receptor turnover following RAD1901 treatment. Patient screening for this maximum tolerated dose study is currently underway. We also intend to commence a Phase 1 clinical trial in 2014 to evaluate high-dose RAD1901 for the treatment of BCBM. In March 2014, we submitted to the FDA an application for orphan-medicinal product designation of RAD1901 for the treatment of BCBM. We are also developing RAD1901 at lower doses as a selective estrogen receptor modulator, or SERM, for the treatment of vasomotor symptoms. Historically, hormone replacement therapy, or HRT, with estrogen or progesterone was considered the most efficacious approach to relieving menopausal symptoms such as hot flashes. However, because of the concerns about the potential long-term risks and contraindications associated with HRT, we believe a significant need exists for new therapeutic treatment options to treat vasomotor symptoms. In a Phase 2 proof of concept study, RAD1901 at lower doses demonstrated a reduction in the frequency and severity of moderate and severe hot flashes. We believe RAD1901 is an attractive candidate for advancement into Phase 2b development as a treatment for vasomotor symptoms. OUR OPPORTUNITY Osteoporosis Osteoporosis is a disease characterized by low bone mass and structural deterioration of bone tissue, which leads to greater fragility and an increase in fracture risk. All bones become more fragile and susceptible to fracture as the disease progresses. People tend to be unaware that their bones are getting weaker, and a person with osteoporosis can fracture a bone from even a minor fall. The debilitating effects of osteoporosis have substantial costs. Loss of mobility, admission to nursing homes and dependence on caregivers are all Copies To: Peter N. Handrinos B. Shayne Kennedy Latham & Watkins LLP John Hancock Tower, 20th Floor 200 Clarendon Street Boston, Massachusetts 02116 (617) 948-6000 Julio E. Vega William S. Perkins Bingham McCutchen LLP One Federal Street Boston, Massachusetts 02110 (617) 951-8000 Table of Contents common consequences of osteoporosis. The prevalence of osteoporosis is growing and, according to the National Osteoporosis Foundation, or the NOF, is significantly under-recognized and under-treated in the population. While the aging of the population is a primary driver of an increase in cases, osteoporosis is also increasing from the use of drugs that induce bone loss, such as chronic use of glucocorticoids and aromatase inhibitors that are increasingly used for breast cancer and the hormone therapies used for prostate cancer. The NOF has estimated that 10 million people in the United States, composed of eight million women and two million men, already have osteoporosis, and another approximately 43 million have low bone mass placing them at increased risk for osteoporosis. In addition, the NOF has estimated that osteoporosis is responsible for more than two million fractures in the United States each year resulting in an estimated $19 billion in costs annually. The NOF expects that the number of fractures in the United States due to osteoporosis will rise to three million by 2025, resulting in an estimated $25.3 billion in costs each year. Worldwide, osteoporosis affects an estimated 200 million women according to the International Osteoporosis Foundation, or IOF, and causes more than 8.9 million fractures annually, which is equivalent to an osteoporotic fracture occurring approximately every three seconds. The IOF has estimated that 1.6 million hip fractures occur worldwide each year, and by 2050 this number could reach between 4.5 million and 6.3 million. The IOF estimates that in Europe alone, the annual cost of osteoporotic fractures could surpass 76 billion by 2050. There are two main types of osteoporosis drugs currently available in the United States, anti-resorptive agents and anabolic agents. Anti-resorptive agents act to prevent further bone loss by inhibiting the breakdown of bone, whereas anabolic agents stimulate bone formation to build new, high-quality bone. According to industry sources, sales of these drugs in the United States, Japan and the five major markets in Europe exceeded $6 billion in 2011. We believe there is a large unmet need in the market for osteoporosis treatment because existing therapies have shortcomings in efficacy, tolerability and convenience. For example, one current standard of care, bisphosphonates, an anti-resorptive agent, has been associated with infrequent but serious adverse events, such as osteonecrosis of the jaw and atypical fractures, especially of long bones. These side effects, although uncommon, have created increasing concern with physicians and patients. Many physicians are seeking alternatives to bisphosphonates. The two primary alternatives to bisphosphonates that are approved for the treatment of osteoporosis, Lilly's Forteo and Amgen's Prolia, had reported sales of approximately $1.2 billion and $700 million, respectively, in 2013. Forteo, a 34 amino acid recombinant peptide of human parathyroid hormone, is the only anabolic drug approved in the United States for the treatment of osteoporosis. We believe there is a significant opportunity for an anabolic agent that is able to increase BMD to a greater degree and at a faster rate than other approved drugs for the treatment of osteoporosis with added advantages in convenience and safety. Our Solution Abaloparatide We believe that abaloparatide is the most advanced PTHrP analog in clinical development for the treatment of osteoporosis and that it can provide the following advantages over other current standard of care treatments for osteoporosis: improved efficacy greater bone build at hip and spine; faster benefit for building bone; shorter treatment duration; less hypercalcemia; no additional safety risks; and no refrigeration required in use. Abaloparatide-SC. Abaloparatide-SC is an injectable, subcutaneous formulation of abaloparatide. In April 2011, we began dosing patients in a pivotal, multinational Phase 3 clinical trial designed to show that Abaloparatide-SC prevents new vertebral fracture compared to placebo. We completed enrollment in this Phase 3 clinical study in March 2013 and expect to report top-line, 18-month fracture data at the end of the fourth quarter of 2014. If the data from this Phase 3 clinical trial are positive, we plan to submit the Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. Table of Contents NDA and the MAA for Abaloparatide-SC in mid-2015. We expect commercial launch to follow in 2016 in the United States, if and when the FDA approves the NDA for Abaloparatide-SC, and in the EU if and when an MAA for Abaloparatide-SC is approved. Abaloparatide-TD. Abaloparatide-TD is a convenient, short-wear-time transdermal patch formulation of abaloparatide with Phase 2 clinical results suggesting efficacy, safety and tolerability in the treatment of osteoporosis. We currently plan to optimize Abaloparatide-TD to achieve efficacy comparable to that of Abaloparatide-SC. If Abaloparatide-SC is approved by the FDA, we believe that we will only need to conduct a single non-inferiority Phase 3 clinical trial comparing the change in lumbar spine BMD at 12 months for patients dosed with Abaloparatide-TD to patients dosed with Abaloparatide-SC to show that the effect of Abaloparatide-TD treatment is comparable to that of Abaloparatide-SC. If our clinical trials of Abaloparatide-SC and Abaloparatide-TD are successful, we expect to seek marketing approval of Abaloparatide-TD as a line extension of Abaloparatide-SC. The FDA approval of Abaloparatide-TD, and the timing of any such approval, is dependent upon the approval of Abaloparatide-SC. Metastatic Breast Cancer According to the World Health Organization, breast cancer is the second most common cancer in the world and the most prevalent cancer in women, accounting for 16% of all female cancers. The major cause of death from breast cancer is metastases, most commonly to the bone, liver, lung and brain. About 5% of patients have distant metastases at the time of diagnoses, and these patients have a 5-year survival rate of only 24%, compared with a greater than 98% survival rate for patients with only local disease. Importantly, even patients without metastases at diagnosis are at risk for developing metastases over time. Approximately, 70% of breast cancers express the estrogen receptor, or ER, and depend on estrogen signaling for growth and survival. There are three main classes of therapies for ER-positive tumors available: aromatase inhibitors, or AIs; SERMs; and SERDs. AIs, which block the generation of estrogen, and SERMs, which selectively inhibit an ER's ability to bind estrogen, both block ER-dependent signaling but leave functional ERs present on breast cancer cells. For this reason, although these classes of drugs are effective as adjuvants for breast cancer, patients' tumors often acquire resistance to them by developing the ability to signal through the ER in a ligand-independent manner. SERDs, in contrast, are an emerging class of endocrine therapies that directly induce ER degradation. Therefore, these agents should be able to treat ER-dependent tumors without allowing ligand-independent resistance to develop, and they should also be able to act on AI- and SERM-resistant ER-positive tumors. Symptomatic BCBM occur in 10% to 16% of patients with metastatic breast cancer and are associated with particularly high morbidity and mortality. Current standard of care involves a combination of whole-brain radiotherapy, surgery or stereotactic radiosurgery, depending on the clinical context. These treatments are often only marginally effective, and are themselves associated with significant morbidity and mortality. There is currently only one SERD approved for the treatment of ER-positive metastatic breast cancer, but there are no approved targeted therapies that cross the blood-brain barrier and can treat patients with ER-positive BCBM. We believe a significant opportunity exists for a SERD that can cross the blood-brain barrier to more effectively treat ER-positive BCBM and potentially delay or eliminate the need for radiation or surgery. Our Solution RAD1901 We are developing RAD1901 as a high-dose SERD in an oral formulation in Phase 1 clinical development for the treatment of BCBM. RAD1901 has been shown to bind with good selectivity to the estrogen hormone receptor and to have both estrogen-like and estrogen-antagonist effects in different tissues. In cell culture, RAD1901 does not stimulate replication of breast cancer cells, and antagonizes the stimulating effects of estrogen on cell proliferation. Furthermore, in breast cancer cell lines a dose dependent down regulation of ER, has been observed, a process we have shown to involve proteosomal mediated degradation pathway. In a model of breast cancer in which human breast cancer cells are implanted in mice and allowed to establish tumors in response to estrogen treatment, we have shown that treatment with RAD1901 results in decreased tumor growth. Studies with RAD1901 have established the pharmacokinetic profile, If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of Each Class of Securities To Be Registered Proposed Maximum Aggregate Offering Price(1) Amount of Registration Fee(2)(3) Common Stock, $0.0001 par value per share $59,800,000 $7,703 (1)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended. Includes the offering price of additional shares that the underwriters have the option to purchase. (2)Calculated pursuant to Rule 457(o) based on an estimate of the proposed maximum aggregate offering price. (3)A registration fee of $11,850 was previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents including demonstration of good oral bioavailability and the ability of RAD1901 to cross the blood-brain barrier, with therapeutic levels detectable in the brain. We believe that RAD1901 could offer the following advantages over other current standard of care treatments for BCBM: ability to penetrate the blood-brain barrier; oral administration; and treatment of hormone-resistant breast cancers. We intend to advance the development of RAD1901 with the initiation of two Phase 1 clinical trials a maximum tolerated dose study that has commenced patient screening, and a Phase 1b clinical trial in BCBM, which is expected to commence in late-2014. Vasomotor symptoms Vasomotor symptoms, such as hot flashes and night sweats, are common during menopause, with up to 85% of women experiencing them during the menopause transition, for a median duration of four years. In 2010, approximately 11.5 million women in the United States were in the 45 to 49 year age range upon entering menopause. In addition, most women receiving systemic therapy for breast cancer suffer hot flashes, often with more severe or prolonged symptoms than women experiencing menopause. These symptoms can disrupt sleep and interfere with quality of life. An estimated two million women go through menopause every year in the United States, with a total population of 50 million postmenopausal women. Historically, hormone replacement therapy, or HRT, with estrogen and/or progesterone was considered the most efficacious approach to relieving menopausal symptoms such as hot flashes. However, data from the Women's Health Initiative, or WHI, identified increased risks for malignancy and cardiovascular disease associated with estrogen therapy. Sales of HRT declined substantially after the release of the initial WHI data, but HRT remains the current standard of care for many women suffering from hot flashes. However, due to concerns about the potential long-term risks and contraindications associated with HRT, we believe that there is a significant need for new therapeutic options to treat vasomotor symptoms. Our Solution RAD1901 We are developing RAD1901 as a low dose SERM in an oral formulation for the treatment of vasomotor symptoms. We conducted a Phase 2 proof of concept study in 100 healthy perimenopausal women using four doses of RAD1901 10 mg, 25 mg, 50 mg and 100 mg and placebo. While a classic dose-response effect was not demonstrated, at the 10 mg dose level RAD1901 achieved a statistically significant reduction in the frequency of moderate and severe hot flashes both by linear trend test and by comparison to placebo and in overall hot flashes at either the two-, three- or four-week time-points. A similar reduction in composite score frequency severity of hot flashes was identified at all time-points, with a statistically significant difference from placebo achieved at the two-, three- or four-week time-points. We anticipate our next clinical study will be a Phase 2b study conducted in approximately 200 perimenopausal women experiencing a high frequency of hot flashes at baseline. The main study endpoints would be an assessment of the change in the frequency and severity of moderate and severe hot flashes. OUR STRATEGY Our goal is to become a leading provider of therapeutics for osteoporosis and other serious endocrine-mediated diseases. To achieve this goal we plan to: advance the development and obtain regulatory approval of Abaloparatide-SC; extend the lifecycle of abaloparatide through the continued development of Abaloparatide-TD; establish internal sales and marketing capabilities to commercialize our product candidates in the United States; selectively pursue collaborations to commercialize our product candidates outside the United States; and Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED, JUNE 2, 2014 PRELIMINARY PROSPECTUS 6,500,000 Shares Radius Health, Inc. Common Stock We are offering 6,500,000 shares of our common stock. This is our initial public offering and no public market currently exists for our common stock. We expect the initial public offering price to be $8.00 per share. We have applied to list our common stock on the NASDAQ Global Market under the symbol "RDUS." Investing in our common stock involves a high degree of risk. Please read "Risk factors" beginning on page 13 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Table of Contents continue to expand our product portfolio through drug discovery, in-licensing, acquisitions or partnerships. RECENT DEVELOPMENTS On May 9, 2014, we submitted a breakthrough therapy designation request to the FDA for Abaloparatide-SC for the treatment of postmenopausal osteoporosis. Abaloparatide-SC was selected for clinical development on the basis of its demonstrated marked effects on increasing bone mass in non-clinical models. The recently completed analyses of two abaloparatide Phase 2 clinical trials have confirmed these non-clinical results, suggesting potentially important clinical benefits relative to current anabolic therapies, including faster and greater increases in hip (non-vertebral) and spine (vertebral) BMD. We believe these results could support a breakthrough therapy designation. On May 18, 2014 at the European Calcified Tissue Society Congress, we presented the preliminary results from our 16-month monkey OVX study showing significant BMD gains, together with increases in bone strength at vertebral and non-vertebral sites. In this study, ovariectomy and a 9-month bone depletion period resulted in a marked osteopenia demonstrated by decreased BMD and decreased bone strength. Daily administration of abaloparatide resulted in marked bone anabolic effects. Spine and femoral neck BMD was comparable to, or above, pre-ovariectomy levels after 4 months of treatment, with further increases at 12 months, which were sustained at 16 months. Total tibia metaphysis BMD was also increased at all doses. These BMD gains were associated with increases in bone formation markers. As expected for osteopenic animals, decreases in bone mass were associated with decreased bone strength parameters for lumbar vertebral cores and vertebral bodies in compression. Abaloparatide treatment resulted in complete reversal of ovariectomy-induced strength loss at the spine with increased yield load for the vertebral core and at the vertebral body. At an important non-vertebral site, the femoral neck, peak load shear was decreased in control animals, relative to sham, while this loss was reversed with abaloparatide treatment. This study demonstrated that abaloparatide treatment rapidly builds high-quality new bone in osteopenic monkeys, with sustained gains over time, and improved bone strength at clinically relevant sites. On May 30, 2014, we entered into a new credit facility with Solar Capital Ltd., as collateral agent and lender, and Oxford Finance LLC, as a lender. Under the new credit facility, an initial term loan was made for an aggregate principal amount equal to $21.0 million. In connection wih the new credit facility we also issued the lenders warrants to purchase an aggregate of up to 10,258 shares of our series B-2 convertible preferred stock at an exercise price of $61.42 per share. We used approximately $9.3 million of the term loan to repay all the amounts owed by us under our existing credit facility with General Electric Capital Corporation and Oxford Finance LLC. For additional description of the new credit facility and the warrants, see "Management's Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources Financings New Credit Facility".
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+Table of Contents EXECUTIVE COMPENSATION During fiscal 2012 and 2013 we issued shares of our common stock to compensate our officers and directors for services rendered on our behalf and intend to issue additional shares of common stock in the future as part of our compensation package for our officers and directors. The following table sets forth summary compensation information for the years ended December 31, 2012 and 2013 for our chief executive officer, interim chief financial officer and chief operating officer and vice president of customer service for Guardian 8 Corporation. We did not have any other executive officers as of the end of fiscal 2013 whose total compensation exceeded $100,000. We refer to these persons as our named executive officers elsewhere in this report. Summary Compensation Table Name and Principal Position Period Salary ($) Bonus ($) Option Awards ($) All Other Compensation ($) Total ($) C. Stephen Cochennet 2013 $ 250,000 $ 61,100 (1) - $ 263,325 (2) $ 574,425 President, Chief Executive Officer 2012 $ 0 $ 175,000 (3) - - $ 175,000 Kathleen Hanrahan 2013 $ - - - $ 181,132 (4) $ 181,132 Interim Chief Financial Officer 2012 $ 0 - - 132,000 (5) $ 132,000 Paul Hughes(6) 2013 $ 150,000 $ - - $ 183,702.50 (7) $ 333,702.50 Chief Operating Officer 2012 $ 118,500 $ 30,000 (8) - $ - $ 148,500 Guardian 8 Corporation Jose Rojas 2013 $ 96,000 $ - - $ 47,035.20 (9) $ 143,035.20 Vice President of Customer Service Guardian 8 Corporation 2012 (10) $ 24,000 $ - - $ - $ 24,000 (1) Represents fair value of 100,000 shares authorized for issuance to Mr. Cochennet on December 31, 2013 as a bonus for his services as the CEO, above and beyond his employment agreement. These shares were issued in February of 2014. (2) Represents fair value of 600,000 shares authorized for issuance to Mr. Cochennet pursuant to the terms of the vesting schedule set forth in his employment agreement for shares vested as of March 31, 2013, June 30, 2013, September 30, 2013 and December 31, 2013. (3) Represents fair value of 500,000 shares authorized for issuance to Mr. Cochennet on December 31, 2012 as a bonus for his services as the CEO. These shares were issued in January of 2013. (4) Includes $36,000 paid to Ms. Hanrahan as consulting fees under her interim chief financial officer agreement and the fair value of 312,000 shares ($145,132) authorized for issuance to Ms. Hanrahan pursuant to the terms of her interim chief financial officer agreement for shares vested as of June 30, 2013, September 30, 2013 and December 31, 2013. (5) Represents fair value of 300,000 shares authorized for issuance to Ms. Hanrahan on December 31, 2012 pursuant to the terms of her interim chief financial officer agreement. These shares were issued in January of 2013. (6) Mr. Hughes served as a consultant for Guardian 8 Corporation from October of 2010 to December of 2011. Effective December 1, 2011, Guardian 8 Corporation hired Mr. Hughes as its Vice President of Operations and Security Sales Manager and on October 1, 2012, Mr. Hughes became the Chief Operating Officer of Guardian 8 Corporation. (7) Represents fair value of 352,500 shares authorized for issuance to Mr. Hughes pursuant to the terms of his employment agreement for shares earned as of March 31, 2013, June 30, 2013 and December 31, 2013. (8) Represents fair value of 150,000 shares issued to Mr. Hughes in March of 2012 as a bonus for his services. (9) Represents fair value of 91,200 shares authorized for issuance to Mr. Rojas pursuant to the terms of his employment agreement for shares earned as of March 31, 2013, June 30, 2013 and December 31, 2013. (10) Mr. Rojas employment commenced on October 1, 2012. Table of Contents Executive Employment Agreements CEO Employment Agreement On March 4, 2013, the Registrant entered into an employment agreement with C. Stephen Cochennet, the Registrant s chief executive officer and president. Mr. Cochennet s employment agreement was approved by the governance, compensation and nominating committee of the board of directors of the Registrant. In general, Mr. Cochennet s employment agreement contains provisions concerning terms of employment, voluntary and involuntary termination, indemnification, severance payments, and other termination benefits, in addition to a non-compete clause and certain other perquisites, such as; long-term disability insurance, director and officer insurance, and a $1,500 per month insurance allowance to offset the cost of privately purchased medical insurance until such time as the Registrant obtains a group medical insurance program. The original term of Mr. Cochennet s employment agreement ran from January 1, 2013 until March 31, 2014. We are currently in the process of negotiating final terms for a new employment agreement with Mr. Cochennet. Mr. Cochennet s employment agreement provides for an initial annual base salary of $250,000, which may be adjusted by the governance, compensation and nominating committee or the board of directors of the Registrant. This base salary shall accrue from January 1, 2013 until the Registrant completes a financing raising a minimum of $2.0 million in gross funds. In addition, Mr. Cochennet is eligible to receive annual short term incentive bonuses as determined by a review at the discretion of the Registrant s board of directors or governance, compensation and nominating committee thereof. Further, the Registrant granted Mr. Cochennet the opportunity to receive 750,000 shares of the Registrant s common stock under the employment agreement. These shares vest, assuming Mr. Cochennet remains employed by the Registrant, based on the following schedule: 150,000 shares on March 31, 2013; 150,000 shares on June 30, 2013; 150,000 shares on September 30, 2013; 150,000 shares on December 31, 2013; and 150,000 shares on March 31, 2014. In the event of a termination of employment with the Registrant by the Registrant without cause (as defined in the employment agreement), by reason of incapacity, disability or death, Mr. Cochennet, or his estate, would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment or death; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) 12-months base salary, payable in accordance with the Registrant s ordinary payroll practices; and (iv) immediate vesting of all equity awards (including but not limited to stock options and restricted shares). In the event of a termination of Mr. Cochennet s employment with the Registrant by reason of change in control (as defined in the employment agreement), Mr. Cochennet, would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) during such unexpired term of the employment agreement, or for 12-months thereafter, whichever is shorter, he shall continue to receive on a semimonthly basis, his base salary then in effect upon the date of such change in control notice; and (iv) and immediate vesting of all equity awards (including but not limited to stock options and restricted shares). Table of Contents If the event of a termination of Mr. Cochennet s employment by the Registrant for cause (as defined in the employment agreement), Mr. Cochennet would receive all earned but unpaid base salary through the date of termination of employment. The above description of Mr. Cochennet s employment agreement is qualified in its entirety by reference to the full text of that agreement, a copy of which was attached to the Form 8-K filed on March 18, 2013 as Exhibit 10.3. Amendment to CFO Agreement Effective March 4, 2013, the Registrant entered into Amendment No. 1 to the Non-Employee Interim Chief Financial Officer Engagement Agreement with Kathleen Hanrahan. The amendment extended the term of Ms. Hanrahan s engagement agreement until March 31, 2014. Further, the engagement agreement provides for compensation to Ms. Hanrahan of 416,250 shares of the Registrant s common stock, which shall vest and be issued upon the earlier of (i) in quarterly installments as follows: 104,000 shares on June 30, 2013; 104,000 shares on September 30, 2013; 104,000 shares on December 31, 2013; and 104,250 on March 31, 2014, or (ii) when the Company hires a full time replacement chief financial officer. Further, the Registrant shall pay Ms. Hanrahan a base monthly retainer of $3,000. Such monthly retainer shall accrue from January 1, 2013 until the Registrant completes a financing raising a minimum of $2.0 million in gross funds. A copy of the amendment to Ms. Hanrahan s agreement was attached to the Form 8-K filed on March 18, 2013 as Exhibit 10.4. On May 22, 2014, the Registrant entered into Amendment No. 2 to the Non-Employee Interim Chief Financial Officer Engagement Agreement with Kathleen Hanrahan. The amendment extended the term of Ms. Hanrahan s engagement agreement from April 1, 2014 through November 30, 2015. Further, the engagement agreement provides for compensation to Ms. Hanrahan of up to 935,000 shares of the Registrant s common stock, which shall be issued as follows; (i) 200,000 shares immediately upon the execution of the amendment, (ii) the remaining balance in installments of 105,000 shares per quarter commencing on June 30, 2014 and continuing throughout the term of the agreement, or until such time as the Registrant hires a full-time replacement chief financial officer. Any shares earned during a partial quarter will be pro-rated based upon 35,000 shares per month. The value of such shares shall be set at the closing price of the Registrant s common stock on the Over-the-Counter Bulletin Board or other exchange or quotation medium on the last trading day immediately before issuance of the shares. Further, the Registrant shall continue to pay Ms. Hanrahan a base monthly retainer of $3,000. A copy of the amendment to Ms. Hanrahan s agreement was attached to the Form 8-K filed on May 28, 2014 as Exhibit 10.16. Amendment and Restatement of Hughes Employment Agreement Effective October 1, 2012, Guardian 8 Corporation ( G8 ), the wholly owned operating subsidiary of the Registrant, amended and restated the employment agreement with Paul Hughes to act as G8 s Chief Operating Officer. Mr. Hughes amended and restated employment agreement was approved by the board of directors of G8 and the Registrant. In general, Mr. Hughes amended and restated employment agreement contains provisions concerning terms of employment, voluntary and involuntary termination, indemnification, severance payments, and other termination benefits, in addition to a non-compete clause and certain other perquisites, such as; long-term disability insurance, and a $500 per month insurance allowance to offset the cost of privately purchased medical insurance until such time as the Registrant obtains a group medical insurance program. Table of Contents The term of Mr. Hughes amended and restated employment agreement runs from October 1, 2012 until September 30, 2015. Mr. Hughes amended and restated employment agreement provides for an initial annual base salary of $150,000, which may be adjusted by the board of directors of G8. In addition, Mr. Hughes is eligible to receive annual short term incentive bonuses as determined by a review at the discretion of the G8 board of directors. Further, the Registrant granted Mr. Hughes the opportunity to receive up to 650,000 shares of the Registrant s common stock under the amended and restated employment agreement. Up to 100,000 shares shall vest upon successful completion of an equity capital raise netting the Registrant a minimum of $1.8 million dollars. Up to an additional 100,000 shares shall vest upon successful completion of pre-determined objectives detailed by G8 s CEO and/or Board of Directors and in accordance with the amended and restated employment agreement. In addition, up to 150,000 shares shall vest on September 30, 2013 upon successful completion of pre-determined objectives detailed by G8 s CEO and/or Board of Directors and in accordance with the amended and restated employment agreement. Further, up to 150,000 shares shall vest on September 30, 2014 upon successful completion of pre-determined objectives detailed by G8 s CEO and/or Board of Directors and in accordance with the amended and restated employment agreement. Finally, up to 150,000 shares shall vest on September 30, 2015 upon successful completion of pre-determined objectives detailed by G8 s CEO and/or Board of Directors and in accordance with the amended and restated employment agreement. In the event of a termination of employment with G8 by G8 without cause (as defined in the employment agreement), Mr. Hughes would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment or death; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) 12-months base salary, payable in accordance with G8 s ordinary payroll practices; and (iv) immediate vesting of all equity awards (including but not limited to stock options and restricted shares). In the event of a termination of employment with G8 by G8 by reason of incapacity, disability or death, Mr. Hughes, or his estate, would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment or death; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) payment of his base salary equal to one month for each two months Hughes was employed under the terms of the amended and restated employment agreement, with a maximum payment of twelve months of base salary; and (iv) immediate vesting of all equity awards (including but not limited to stock options and restricted shares). In the event of a termination of Mr. Hughes employment with G8 by reason of change in control (as defined in the employment agreement), Mr. Hughes, would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) during such unexpired term of the employment agreement, or for 6-months thereafter, whichever is shorter, he shall continue to receive on a semimonthly basis, his base salary then in effect upon the date of such change in control notice; and (iv) and immediate vesting of all equity awards (including but not limited to stock options and restricted shares). If the event of a termination of Mr. Hughes employment by G8 for cause (as defined in the employment agreement), Mr. Hughes would receive all earned but unpaid base salary through the date of termination of employment. Table of Contents The above description of Mr. Hughes amended and restated employment agreement is qualified in its entirety by reference to the full text of that agreement, a copy of which was attached to the Form 8-K filed on March 18, 2013 as Exhibit 10.5. Rojas Employment Agreement Effective October 1, 2012, G8 entered into an employment agreement with Jose Rojas to act as G8 s Vice President of Customer Services. Mr. Rojas employment agreement was approved by the board of directors of G8 and the Registrant. In general, Mr. Rojas employment agreement contains provisions concerning terms of employment, voluntary and involuntary termination, indemnification, severance payments, and other termination benefits, in addition to a non-compete clause and certain other perquisites, such as; long-term disability insurance, director and officer insurance, and a $500 per month insurance allowance to offset the cost of privately purchased medical insurance until such time as the Registrant obtains a group medical insurance program. The original term of Mr. Rojas employment agreement runs from October 1, 2012 until September 30, 2015. Mr. Rojas employment agreement provides for an initial annual base salary of $96,000, which may be adjusted by the board of directors of G8. In addition, Mr. Rojas is eligible to receive annual short term incentive bonuses as determined by a review at the discretion of the G8 board of directors. Further, the Registrant granted Mr. Rojas the opportunity to receive up to 288,000 shares of the Registrant s common stock under the amended and restated employment agreement. Up to 96,000 shares shall vest on September 30, 2013 upon successful completion of pre-determined objectives detailed by G8 s CEO and/or Board of Directors and in accordance with the employment agreement. In addition, up to 96,000 shares shall vest on September 30, 2014 upon successful completion of pre-determined objectives detailed by G8 s CEO and/or Board of Directors and in accordance with the amended and restated employment agreement. Further, up to 96,000 shares shall vest on September 30, 2015 upon successful completion of pre-determined objectives detailed by G8 s CEO and/or Board of Directors and in accordance with the amended and restated employment agreement. In the event of a termination of employment with G8 by G8 without cause (as defined in the employment agreement), Mr. Rojas would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment or death; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) 6-months base salary, payable in accordance with the Registrant s ordinary payroll practices; and (iv) immediate vesting of all equity awards (including but not limited to stock options and restricted shares). In the event of a termination of employment with G8 by G8 by reason of incapacity, disability or death, Mr. Rojas, or his estate, would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment or death; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) payment of his base salary equal to one month for each two months Rojas was employed under the terms of the employment agreement, with a maximum payment of six months of base salary; and (iv) immediate vesting of all equity awards (including but not limited to stock options and restricted shares). Table of Contents In the event of a termination of Mr. Rojas employment with G8 by reason of change in control (as defined in the employment agreement), Mr. Rojas, would receive: (i) a lump sum payment equal to all earned but unpaid base salary through the date of termination of employment; (ii) a lump sum payment equal to a pro rata portion of any bonus or incentive payment to which he would have been entitled had he remained continuously employed for the full fiscal year in which death, disability or termination occurred and continued to perform his duties in the same manner as they were performed immediately prior to the death, disability or termination; (iii) during such unexpired term of the employment agreement, or for 6-months thereafter, whichever is shorter, he shall continue to receive on a semimonthly basis, his base salary then in effect upon the date of such change in control notice; and (iv) and immediate vesting of all equity awards (including but not limited to stock options and restricted shares). If the event of a termination of Mr. Rojas employment by G8 for cause (as defined in the employment agreement), Mr. Rojas would receive all earned but unpaid base salary through the date of termination of employment. The above description of Mr. Rojas employment agreement is qualified in its entirety by reference to the full text of that agreement, a copy of which was attached to the Form 8-K filed on March 18, 2013 as Exhibit 10.6. Silva Employment Agreement Effective March 11, 2013, G8 entered into an employment agreement with Daniel Silva to act as G8 s Lead Engineer. Mr. Silva s employment agreement was approved by the board of directors of G8 and the Registrant. Mr. Silva terminated his employment with G8 in October of 2013. Mr. Silva did not earn or vest any equity awards under the term of his employment agreement. Potential Payments Upon Termination or Change in Control As described above, we have entered into employment agreements with our chief executive officer and three employees of Guardian 8 Corporation. These employment agreements allow each employee to resign upon a change in control or business combination. For purposes of the employment agreements, a change in control or business combination is defined as: (i) The sale, lease, exchange or other transfer, directly or indirectly of all or substantially all of the assets of the Company (in one transaction or in a series of related transactions) to a person or entity that is not controlled by the Company; (ii) The approval by the Board of Directors of the Company of any plan or proposal for the liquidation or dissolution of the Company; or (iii) The Board of Directors cease for any reason, to constitute at least majority of the Company s voting authority. Grants of Plan-Based Awards in Fiscal 2013 We did not grant any plan-based awards to our named executive officers during the fiscal year ended December 31, 2013. Outstanding Equity Awards at 2013 Fiscal Year-End We did not have any outstanding equity awards as of December 31, 2013. Option Exercises for 2013 There were no options issued or exercised by our named executive officer in fiscal 2013. Table of Contents Director Compensation The following table sets forth summary compensation information for the year ended December 31, 2013 for each of our directors. Name Fees Earned or Paid in Cash $ Stock Awards $ Option Awards $ All Other Compensation $ Total $ C. Stephen Cochennet(1) $ - $ 36,660 $ - $ - $ 36,660 James G. Miller(1) $ - $ 36,660 $ - $ - $ 36,660 Kyle Edwards(1) $ - $ 36,660 $ - $ - $ 36,660 Kathleen Hanrahan(1) $ - $ 36,660 $ - $ - $ 36,660 Corey Lambrecht(1) $ - $ 36,660 $ - $ - $ 36,660 Jim Nolton(1) $ - $ 36,660 $ - $ 67,500 (2) $ 104,160 William J. Clough(3) $ - $ - $ - $ - $ - (1) On December 31, 2013, we issued each of our directors 60,000 shares of our common stock valued at $0.611 per share for 2013 director services. (2) Represents the deemed fair value of 225,000 shares of common stock issued to Mr. Nolton on August 8, 2013 for engineering services. (3) Mr. Clough was appointed as a director in April of 2014, at which time he was issued 60,000 shares of common stock valued at $30,600. Directors generally receive equity compensation of 60,000 restricted shares of common stock per year of service. Further, directors who are not employees are reimbursed for travel and other expenses if required. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS Other than as set forth below, we were not a party to any transactions or series of similar transactions that have occurred during fiscal 2013 in which: The amounts involved exceeds the lesser of $120,000 or one percent of the average of our total assets at year end for the last two completed fiscal years ($6,554); and A director, executive officer, holder of more than 5% of our common stock or any member of their immediate family had or will have a direct or indirect material interest. Related Party Promissory Notes On January 24, 2013, the Company received a note payable from the CEO and president of the Company in the amount of $50,000. The note is unsecured, bears interest at 12% per annum and was payable on September 1, 2013. On March 6, 2013, the Company received a note payable from the CEO and president of the Company in the amount of $100,000. The note is unsecured, bears interest at 12% per annum and was payable on September 1, 2013. On March 6, 2013, the Company received $50,000 from a director of the Company in the form of an unsecured 90-day promissory note. The note is unsecured, bears interest at 12% per annum and was payable on September 1, 2013. Table of Contents On March 26, 2013, the Company received $50,000 from a director of the Company in the form of an unsecured 90-day promissory note. The note is unsecured, bears interest at 12% per annum and was payable on September 1, 2013. On August 12, 2013, the Company received a note payable from the CEO and president of the Company in the amount of $50,000. The note is unsecured, bears interest at 12% per annum and was payable on November 30, 2013. On August 26, 2013, 2013, the Company received a note payable from the CEO and president of the Company in the amount of $150,000. The note is unsecured, bears interest at 12% per annum and was payable on November 30, 2013. On September 1, 2013, the Company had a total of $615,000 of the original $650,000 in notes payable outstanding to its CEO and directors, with an additional $33,933 owed in accrued interest. This debt, previously due on September 1, 2013 through November 30, 2013, was exchanged for three new unsecured notes payable totaling $648,933 as detailed in the table below. Each of these notes matures on April 30, 2014, bear interest at 12% per annum, and include a three-year warrant for every $1.00 of principal amount of each note. The warrants are exercisable at $0.40 per share. Issue Date Interest Rate Current Due Date Amount September 1, 2013 12.0 % April 30, 2014 $ 543,300 September 1, 2013 12.0 % April 30, 2014 52,983 September 1, 2013 12.0 % April 30, 2014 52,650 Total $ 648,933 On September 1, 2013 the Company received a note payable in the amount of $45,000 from a related party in exchange for outstanding invoices owed for engineering services provided in the first nine months of the year. The note is unsecured, bears interest at 12% per annum, is payable on April 30, 2014, and includes a three-year warrant for each $1.00 of principal included in the note. The warrants are exercisable at $0.40 per share. On September 18, 2013, the Company received a note payable from the CEO and president of the Company in the amount of $50,000. The note is unsecured, bears interest at 12%, is payable on April 30, 2014, and includes a three-year warrant for each $1.00 of principal included in the note. The warrants are exercisable at $0.40 per share. On September 19, 2013, the Company issued a note payable from a related party in the amount of $30,000. The note is unsecured, bears interest at 12%, is payable on April 30, 2014, and includes a three-year warrant for each $1.00 of principal included in the note. The warrants are exercisable at $0.40 per share. On September 19, 2013, the Company issued a note payable from a related party in the amount of $250,000. The note is unsecured, bears interest at 12%, is payable on April 30, 2014, and includes a three-year warrant for each $1.00 of principal included in the note. The warrants are exercisable at $0.40 per share. All of the above promissory notes were repaid in June of 2014 concurrent with the $7 million Debenture financing. Table of Contents Employment Agreements On March 4, 2013, the Company entered into an employment agreement with its CEO/president. The CEO/president has the ability to earn shares of common stock over the term of the agreement, which runs through March 31, 2014. The Company reserved 750,000 shares of its common stock as required by the agreement. Per the agreement, the Company will issue 150,000 common shares on the last day of every fiscal quarter as compensation through that period. As of December 31, 2013 600,000 common shares have vested. In addition, the Chief Executive Officer and President shall earn an initial base salary of $250,000, which began on January 1, 2013 and will accrue until the Company completes certain requirements per the agreement. On March 4, 2013, the Company amended the agreement with its non-employee interim Chief Financial Officer (CFO). The CFO has the ability to earn shares of common stock over the term of the agreement, which runs through March 31, 2014. The Company reserved 416,250 shares of its common stock as required by the agreement. Per the contract, the Company will issue a prescribed amount of common shares on the last day of every fiscal quarter, beginning with the second quarter of 2013 and ending on March 31, 2014. As of December 31, 2013, 312,000 shares have vested. In addition, the Non-Employee Interim Chief Financial Officer will earn a base monthly retainer of $3000, which began to accrue on January 1, 2013 and will continue to accrue until the Company completes certain requirements per the agreement. As of December 31, 2013, the Company has a total of 548,550 shares of its common stock reserved for the following employment contracts: Employee or Position Shares Chief Operating Officer 97,500 Vice President of Customer Support 196,800 Chief Executive Officer 150,000 Non-Employee Interim Chief Financial Officer 104,250 Total 548,550 Policies for Review and Approval of Related Party Transactions In March of 2012, our board of directors adopted a Related Party Transaction Policy, which is designed to monitor and ensure the proper review, approval, ratification and disclosure of related party transactions. The policy applies to any transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we were, are or will be a participant and the amount involved exceeds $120,000 or one percent of the average of our total assets at year end for the last two completed fiscal years, and in which any related party had, has or will have a direct or indirect material interest. Our board of directors must review, approve and ratify a related party transaction if such transaction is consistent with the Related Party Transaction Policy and is on terms, taken as a whole, which the board believes are no less favorable to us than could be obtained in an arms-length transaction with an unrelated third party, unless the board otherwise determines that the transaction is not in our best interests. Director Independence Our board of directors has affirmatively determined that Messrs. Miller, Edwards, Lambrecht and Nolton are independent directors, as defined by Section 803 of the American Stock Exchange Company Guide. Table of Contents PRINCIPAL STOCKHOLDERS The following table presents information, to the best of G8 s knowledge, about the ownership of G8 s common stock on August 26, 2014 relating to those persons known to beneficially own more than 5% of G8 s capital stock and by G8 s directors and executive officers. The percentage of beneficial ownership for the following table is based on 40,842,560 shares of common stock outstanding. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and does not necessarily indicate beneficial ownership for any other purpose. Under these rules, beneficial ownership includes those shares of common stock over which the stockholder has sole or shared voting or investment power. It also includes shares of common stock that the stockholder has a right to acquire within 60 days after Augsut 26, 2014 pursuant to options, warrants, conversion privileges or other right. The percentage ownership of the outstanding common stock, however, is based on the assumption, expressly required by the rules of the Securities and Exchange Commission, that only the person or entity whose ownership is being reported has converted options or warrants into shares of G8 s common stock. Name of Officer or Director(1) Number of Shares Percent of Outstanding Shares of Common Stock(2)(3) C. Stephen Cochennet, CEO/President and Director 8,399,800 (4) 19.9 % Kathleen Hanrahan, Interim CFO and Director 1,276,250 (5) 3.1 % James G. Miller, Director 2,442,539 (6) 5.9 % Kyle Edwards, Director 616,336 (7) 1.5 % Jim Nolton, Director 750,479 (8) 1.8 % Corey Lambrecht, Director 341,534 (9) 0.8 % William Clough, Director 90,000 (10) 0.2 % Paul Hughes, Director, Chief Operating Officer 552,500 1.4 % Jose Rojas, VP Customer Service Guardian 8 Corporation 91,200 0.2 % Directors and Officers as a Group 14,560,638 35.0 % Name and Address of Beneficial Owners James D. Loeffelbein ( Loeffelbein ) Enutroff, LLC ( Enutroff ) 10380 W. 179th Street Bucyrus, Kansas 66213 2,456,207 (11) 6.0 % (1) As used in this table, beneficial ownership means the sole or shared power to vote, or to direct the voting of, security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of, or to direct the disposition of, a security). The address of each person is care of us at 7432 East Tierra Buena, Scottsdale, Arizona 85260. (2) Figures are rounded to the nearest tenth of a percent. (3) Based upon 40,737,560 shares of common stock outstanding as of June 9, 2014. (4) Includes (i) 62,500 warrants to purchase shares of common stock exercisable at $0.55 per share through August 28, 2015, (ii) 62,500 warrants to purchase shares of common stock exercisable at $0.75 per share through August 28, 2017, (iii) 543,301 warrants to purchase shares of common stock exercisable at $0.40 per share through August 31, 2016, (iv) 50,000 warrants to purchase shares of common stock exercisable at $0.40 per share through September 17, 2016, (v) 400,000 warrants to purchase shares of common stock exercisable at $0.50 through February 23, 2017, (vi) 170,000 warrants to purchase shares of common stock exercisable at $0.60 through June 1, 2019, and (vii) 340,000 shares of common stock issuable upon conversion of a $170,000 debenture. (5) Includes (i) 105,000 shares of common stock which vest on September 30, 2014 pursuant to Ms. Hanrahan s interim chief financial officer engagement agreement, (ii) 10,000 warrants to purchase shares of common stock exercisable at $0.60 through June 1, 2019, and (iii) 20,000 shares of common stock issuable upon conversion of a $10,000 debenture. Table of Contents (6) Includes (i) 62,500 warrants to purchase shares of common stock exercisable at $0.55 per share through November 14, 2015, (ii) 62,500 warrants to purchase shares of common stock exercisable at $0.75 per share through November 14, 2017, (iii) 52,984 warrants to purchase shares of common stock exercisable at $0.40 per share through August 31, 2016, (iv) 50,000 warrants to purchase shares of common stock exercisable at $0.50 through February 23, 2017, (v) 50,000 warrants to purchase shares of common stock exercisable at $0.60 through June 1, 2019, and (vi) 100,000 shares of common stock issuable upon conversion of a $50,000 debenture.. (7) Includes (i) 105,425 shares held by Edwards Group Int l LLC ( EGI ), which Mr. Edwards has beneficial ownership and control over, (ii) 20,000 warrants held by EGI to purchase shares of common stock at the price of $0.25 per share through January 11, 2015, (iii) 10,000 warrants to purchase shares of common stock exercisable at $0.60 through June 1, 2019, and (iv) 20,000 shares of common stock issuable upon conversion of a $10,000 debenture. (8) Includes (i) 20,000 warrants to purchase shares of common stock at the price of $0.25 per share through January 11, 2015, (ii) 50,000 warrants to purchase shares of common stock exercisable at $0.55 per share through November 6, 2015, (iii) 50,000 warrants to purchase shares of common stock exercisable at $0.75 per share through November 6, 2017, (iv) 45,000 warrants to purchase shares of common stock exercisable at $0.40 per share through August 31, 2016, (v) 25,000 warrants to purchase shares of common stock exercisable at $0.50 through February 23, 2017, (vi) 20,000 warrants to purchase shares of common stock exercisable at $0.60 through June 1, 2019, and (vii) 40,000 shares of common stock issuable upon conversion of a $20,000 debenture.. (9) Includes (i) 52,650 warrants to purchase shares of common stock exercisable at $0.40 per share through August 31, 2016, (ii) 25,000 warrants to purchase shares of common stock exercisable at $0.60 through June 1, 2019, and (iii) 50,000 shares of common stock issuable upon conversion of a $25,000 debenture.. (10) Includes 10,000 warrants to purchase shares of common stock exercisable at $0.60 through June 1, 2019 and 20,000 shares of common stock issuable upon conversion of a $10,000 debenture.. (11) Based on a Schedule 13G/A filed with the SEC on January 29, 2014 by Loeffelbein, managing member and owner of Enutroff, and Enutroff. Enutroff has shared power voting and dispositive power for 2,231,582 shares. Loeffelbein has the sole voting and dispositive power for 224,625 shares and the shared voting and dispositive power for 2,231,582 shares. DESCRIPTION OF CAPITAL STOCK Common Stock Our articles of incorporation authorizes the issuance of 100,000,000 shares of common stock, $0.001 par value per share, of which 40,842,560 shares were outstanding as of August 27, 2014. Holders of common stock have no cumulative voting rights. Holders of shares of common stock are entitled to share ratably in dividends, if any, as may be declared, from time to time by the board of directors in its discretion, from funds legally available to be distributed. In the event of a liquidation, dissolution or winding up of the company, the holders of shares of common stock are entitled to share pro rata all assets remaining after payment in full of all liabilities. Holders of common stock have no preemptive rights to purchase our common stock. There are no conversion rights or redemption or sinking fund provisions with respect to the common stock. All of the outstanding shares of common stock are validly issued, fully paid and non-assessable. Table of Contents Preferred Stock Our articles of incorporation authorizes the issuance of 10,000,000 shares of preferred stock, $0.001 par value per share, of which no shares were outstanding as of the date of this prospectus. The preferred stock may be issued from time to time by the board of directors as shares of one or more classes or series. Our board of directors, subject to the provisions of our articles of incorporation and limitations imposed by law, is authorized to: adopt resolutions; to issue the shares; to fix the number of shares; to change the number of shares constituting any series; and to provide for or change the following: o the voting powers; o designations; o preferences; and o relative, participating, optional or other special rights, qualifications, limitations or restrictions, including the following: dividend rights, including whether dividends are cumulative; dividend rates; terms of redemption, including sinking fund provisions; redemption prices; conversion rights; and liquidation preferences of the shares constituting any class or series of the preferred stock. In each of the listed cases, we will not need any further action or vote by the stockholders. One of the effects of undesignated preferred stock may be to enable the board of directors to render more difficult or to discourage an attempt to obtain control of us by means of a tender offer, proxy contest, merger or otherwise, and thereby to protect the continuity of our management. The issuance of shares of preferred stock pursuant to the board of director s authority described above may adversely affect the rights of holders of common stock. For example, preferred stock issued by us may rank prior to the common stock as to dividend rights, liquidation preference or both, may have full or limited voting rights and may be convertible into shares of common stock. Accordingly, the issuance of shares of preferred stock may discourage bids for the common stock at a premium or may otherwise adversely affect the market price of the common stock. Convertible Senior Secured Debentures On May 27, 2014, we, and our wholly-owned operating subsidiary, Guardian 8 Corporation ( G8 ), entered into a Securities Purchase Agreement, Registration Rights Agreements, Convertible Senior Secured Debentures, a Pledge and Security Agreement, a Secured Guaranty, a Class C Warrant and other related agreements (the Financing Agreements ), with Wolverine Flagship Fund Trading Limited, Pinnacle Family Office Investments, L.P., CK Management, LLC, Atlas Allocation Fund, L.P., Calm Waters Partnership, Hard 4 Holdings LLC, Carl Feldman, Brett Luskin, Taylor Luskin and Cary Luskin (the Buyers ). On June 2, 2014, pursuant to the $7 Million Debenture Financing Agreements dated May 27, 2014 (attached as exhibits to the Form 8-K filed on May 28, 2014), we, and G8, entered into the remaining Convertible Senior Secured Debentures and Pledge and Security Agreement, with Southwell Capital, LP, Atlas Allocation Fund, L.P., Precept Capital Master Fund, GP, Sandor Capital Master Fund, The Precept Fund II, LP, James K. Price, Vestal Venture Capital, Helmsbridge Holdings Limited, JSL Kids Partners, Cranshire Capital Master Fund, Ltd., James G. Miller (current director), Jim Nolton (current director), Corey Lambrecht (current director), William Clough (current director), Kathleen Hanrahan (current officer and director), Kyle Edwards (current director) and C. Stephen Cochennet (current officer and director) (additional Buyers ). On June 13, 2014, Cranshire Capital Master Fund, Ltd. transferred $22,500 of its $75,000 Debenture to Equitec Specialists, LLC. Further, on August 26, 2014, Jim Nolton transferred his $20,000 Debenture to Nolton Enterprises. Table of Contents Four of our board members converted $195,000 of the principal amount owed to them pursuant to the terms of outstanding term notes (C. Stephen Cochennet [$100,000], James G. Miller [$50,000], Jim Nolton [$20,000] and Corey Lambrecht [$25,000]) into Debentures. Pursuant to the Financing Agreements, we authorized a new series of senior secured debentures (the Debentures ). Under the terms of the Financing Agreements, the Buyer s agreed to purchase and G8 agreed to sell Debentures for a total purchase price of $7,000,000. The Debentures have an eighteen month term and bear an interest rate equal to 8% per annum. In connection with the sale of the Debentures, we agreed to issue the Buyers 7,000,000 Class C common stock purchase warrants, each warrant entitling the holder to purchase one share of our common stock at $0.60 per share for a period of five years (the Closing Securities ). Net Proceeds to us from the First Closing of the financing were $3,841,510.77, after payment of commissions, fees and expenses to our placement agent, Merriman Capital, Inc., of $439,979.23, $55,000 in attorney s fees, $901,510 to repay the Cornerstone Bank line of credit and $12,000 in other fees and expenses. Net Proceeds to us from the Second Closing of the financing were $1,433,230, after payment of commissions, fees and expenses to our placement agents (Merriman Capital, Inc. of $107,100 and Noble Financial Capital Markets of $9,300), crediting conversion of current term notes of $195,000 and $5,370 in attorney s fees. The proceeds raised from the sale of the Debentures will be used for the repayment of short-term debt, including the Cornerstone Bank line of credit, sales and marketing, additional inventory, international sales channel development, research and development of a consumer ENL device, purchase of fixed assets and general corporate purposes. The following describes certain material terms of the financing transaction with the Buyers. The description below is not a complete description of all terms of the financing transaction and is qualified in its entirety by reference to the Financing Agreements entered into in connection with the financing, which are attached as exhibits hereto. Debenture Maturity Date and Interest Rate. The Debentures mature on November 30, 2015, absent earlier redemption by the Registrant, and carry an interest rate of 8% per annum. Payment of Interest and Principal. Interest on the Debentures began accruing on May 27, 2014 and June 2, 2014, respectively, and is payable quarterly in arrears on the first day of each succeeding quarter during the term of the Debentures, beginning on or about May 1, 2015 and ending on the Maturity Date of November 30, 2015. We, under certain conditions specified in the Debentures, may pay interest payments in shares of our registered common stock. Additionally, on the Maturity Date if the Debentures have not been otherwise converted into shares of our common stock, we are required to pay the amount equal to the principal, as well as all accrued but unpaid Interest. Conversion Rights under the Debenture. Subject to certain limitations, the Debentures may be converted by each Buyer commencing on the 91st day following closing and through Maturity, either in whole or in part, up to the full principal amount and accrued interest thereunder into shares of common stock at $0.50 per share. Subject to certain limitations and conditions, we may force conversion of the Debentures into shares of common stock at $0.50 per share, either in whole or in part, if the closing sale price of shares of common stock during any ten consecutive trading days has been at or above $1.00 per share. Further, in the event the average closing price of the common stock for the ten trading days immediately preceding, but not including, the maturity date of the Debentures is equal to or greater than $0.80, then on the maturity date, the Buyers must convert all remaining Principal due under the Debentures. The Debentures contain provisions limiting the conversion to the extent that as a result of such conversion, each Buyer would beneficially own more than 4.99% (subject to waiver) in the aggregate of the issued and outstanding shares of our common stock, calculated immediately after giving effect to the issuance of shares of common stock upon conversion of the Debentures. Table of Contents In addition, upon conversion of the Debentures, the number of Class C warrants issued to each Buyer shall automatically double. Right to Redeem Debenture. Beginning on the 91st day following the closing and so long as a registration statement covering all the registrable securities is effective, we have the option of redeeming the principal, in whole or in part by paying the amount equal to 100% of the Principal, together with accrued and unpaid interest by giving ten (10) business days prior notice of redemption to the Buyers. Security of Debentures. The Debentures were guaranteed, pursuant to the Secured Guaranty and Pledge and Security Agreement by G8 and secured by a security interest in all of our assets and G8 pursuant to various financing instruments, and financing statements. Registration Rights. We agreed to file a resale registration statement with the Securities and Exchange Commission (the SEC ) covering all shares of common stock underlying the Debentures and Class C warrants within 90 days of the final closing under the Financing Agreements (the Filing Date ) and to maintain the effectiveness of the registration statement for five years, or until all securities have been sold or are otherwise able to be sold pursuant to Rule 144. We agreed to use its reasonable best efforts to have the registration statement declared effective within 120 days of the Filing Date (the Effectiveness Date ). We are obligated to pay to investors liquidated damages equal to 1.0% per month in cash for every thirty day period up to a maximum of six (6%) percent, (i) that the registration statement has not been filed after the Filing Date, (ii) following the Effectiveness Date that the registration statement has not been declared effective; and (iii) as otherwise set forth in the Financing Agreements. Additional Restrictions. In addition to standard covenants and conditions such as the Registrant maintaining its reporting status with the SEC pursuant to the 1934 Act, the financing documents contain certain restrictions regarding our operations. INTERESTS OF NAMED EXPERTS AND COUNSEL The financial statements of G8 as of December 31, 2013 and 2012 are included in this prospectus and have been audited by L.L. Bradford & Company, LLC and Samyn & Martin, LLC (formerly Weaver, Martin & Samyn, LLC), respectively, independent auditors, as set forth in their reports appearing elsewhere in this prospectus and are included in reliance upon such reports given upon the authority of such firms as experts in accounting and auditing. The legality of the shares offered hereby will be passed upon for us by DeMint Law, PLLC, 3753 Howard Hughes Parkway, Second Floor Suite 314, Las Vegas, Nevada 89169. None of L.L. Bradford & Company, LLC, Samyn & Martin, LLC (formerly Weaver, Martin & Samyn, LLC) nor DeMint Law, PLLC has been hired on a contingent basis, will receive a direct or indirect interest in G8 or have been a promoter, underwriter, voting trustee, director, officer, or employee of G8. SELLING STOCKHOLDERS All of the shares offered hereby are held of record by the Selling Stockholders set forth below. We are registering the shares covered hereby to permit the Selling Stockholders to offer the shares of common stock for resale from time to time. Other than the ownership of our shares of common stock and as footnoted below, the Selling Stockholders have not within the past three years held a position or office, had any other material relationship with, or otherwise been affiliated with, us or any of our predecessors or affiliates. Unless as otherwise footnoted below, based on information provided to us, the Selling Stockholders are not affiliated, nor have any of them been affiliated, with any broker-dealer in the United States. Table of Contents The following table sets forth information as of August 8, 2014 regarding the beneficial ownership of our common stock by each of the Selling Stockholders. Based on the information provided to us by the Selling Stockholders, assuming that the Selling Stockholders sell all of the Securities owned by them that have been registered by us pursuant to the registration statement of which this prospectus forms a part, including any shares issuable upon exercise of warrants or conversion of debentures, and do not acquire any additional shares of our common stock or our warrants, each Selling Stockholder will not own any shares of our common stock or any of our warrants after completion of this offering. We cannot advise you as to whether the Selling Stockholders will, in fact, sell any or all of such Securities. In addition, the Selling Stockholders may have sold, transferred or otherwise disposed of, or may sell, transfer or otherwise dispose of, at any time and from time to time, the Securities in transactions exempt from the registration requirements of the Securities Act after the date on which they provided the information set forth in the table below. See Plan of Distribution. Shares of Issued and Outstanding Shares of Common Stock Beneficially Owned Prior to the Offering Shares of Common Stock Underlying Warrants Beneficially Owned Prior Shares of Common Stock Underlying Convertible Debentures Beneficially Owned Prior to Maximum Number of Shares Being Offered Shares Beneficially Owned After Name(1) Number(2) Percent(3) to the Offering the Offering Hereunder the Offering Acorn Management Partners LLC(4) 169,468 0.4 % -0- -0- 169,468 -0- Adams, Glenn 93,000 0.2 % -0- -0- 93,000 -0- Allen, Jack B. and Gail P. JTWROS 100,000 0.2 % -0- -0- 100,000 -0- Allen, Robert 2,500 * -0- -0- 2,500 -0- Alva, Steve 9,091 * -0- -0- 9,091 -0- Andrews, Kimberly and Gary 25,000 0.1 % -0- -0- 25,000 -0- AP-ID Incorporated(5) 113,637 0.3 % -0- -0- 113,637 -0- APEX Clearing Corp. Cust FBO Daryl P. Guest Roth IRA Rollover(6) 100,000 0.2 % 200,000 -0- 300,000 -0- APEX Clearing Cust FBO Kevin S. Mellor Rollover IRA(7) 62,500 0.2 % 125,000 -0- 187,500 -0- APEX Clearing Cust FBO Monica Brill IRA(8) 125,000 0.3 % 250,000 -0- 375,000 -0- APEX Clearing Cust Robert H. Jones SEP IRA(9) 125,000 0.3 % 250,000 -0- 375,000 -0- Archon Global Ventures LLC(10) 10,000 * -0- -0- 10,000 -0- ARGH LLC (11) 300,000 0.7 % -0- -0- 300,000 -0- Atlas Allocation Fund, L.P.(12) -0- * 2,000,000 2,000,000 4,000,000 -0- Attorney s Process & Investigative Services, Inc.(13) 113,637 0.3 % -0- -0- 113,637 -0- Barnes, John P. 1,137 * -0- -0- 1,137 -0- BBD Development Holding LLC(14) 22,500 0.1 % -0- -0- 22,500 -0- Bell, Mike 1,075,000 2.6 % -0- -0- 1,075,000 -0- Table of Contents Berendzen, Tim 10,000 * -0- -0- 10,000 -0- Blauer, Stephen Scott 100,000 0.2 % -0- -0- 100,000 -0- Boers, Bradley C.(15) 127,158 0.3 % 25,000 -0- 152 ,158 -0- Bole, David J.(16) 125,000 0.3 % 250,000 -0- 375,000 -0- Bower, Jonathan A. & Susan Kano JRWROS(1 7 ) 125,000 0.3 % 250,000 -0- 375,000 -0- Brian J. Tansey Revocable Trust 100,000 0.2 % -0- -0- 100,000 -0- Brill, Jody B. 15,000 * -0- -0- 15,000 -0- Bucher, James R. & Phyllis Kay 18,182 * -0- -0- 18,182 -0- Burstein, Harvey M. 362,250 0.9 % -0- -0- 362,250 -0- Burstein, Ronald and Laura JTWROS 40,000 0.1 % -0- -0- 40,000 -0- Cabrera, Ingrid T. 228 * -0- -0- 228 -0- Cain, Tom(1 8 ) 62,500 0.2 % 125,000 -0- 187,500 -0- Calm Waters Partnership( 19 ) -0- * 1,000,000 1,000,000 2,000,000 -0- Canyon, Tim 30,000 0.1 % -0- -0- 30,000 -0- Castleberry Properties LLC( 20 ) 250,000 0.6 % 500,000 -0- 750,000 -0- CCG/Mottola Communications( 21 ) -0- * 66,000 -0- 66,000 -0- CK Management LLC( 22 ) -0- * 2,000,000 2,000,000 4,000,000 -0- Clough, William J.(1)( 23 ) 60,000 0.1 % 20,000 20,000 100,000 -0- Coal Creek Energy, LLC( 24 ) 889,555 2.2 % 200,000 -0- 1,089,555 -0- Coal Creek LLC( 25 ) 137,500 0.3 % -0- -0- 137,500 -0- Cochennet, Charles Stephen(1)( 26 ) 4,704,391 11.5 % 1,458,301 340,000 6,502,692 -0- Coconut Drilling Inc.( 27 ) 200,000 0.5 % -0- -0- 200,000 -0- Collier, Simon( 28 ) 62,500 0.2 % 125,000 -0- 187 ,500 -0- Contractor, Patricia & Cyrus D. JTWROS 50,000 0.1 % -0- -0- 50,000 -0- Copher, Keith 1,591 * -0- -0- 1,591 -0- Cordell, Charles 796 * -0- -0- 796 -0- Cranshire Capital Master Fund, Ltd.( 29 ) -0- * 105,000 105,000 210,000 -0- Delaware Charter FBO Thomas Kmak IRA( 30 ) 160,000 0.4 % 200,000 -0- 360,000 -0- DOMCO, LLC ( 31 ) 252,250 0.6 % -0- -0- 252,250 -0- Drobish, Robert J. 1,364 * -0- -0- 1,364 -0- Dumoviich, Julie 175,000 0.4 % -0- -0- 175,000 -0- Duong, David( 32 ) 62,500 0.2 % 125,000 -0- 187,500 -0- East Sand, LLC ( 33 ) 260,000 0.6 % -0- -0- 260,000 -0- Edsall, Ethan 455 * -0- -0- 455 -0- Edwards Group Int l LLC( 34 ) 105,425 0.3 % 20,000 -0- 125 ,425 -0- Edwards, Kyle (1) (34) ( 35 ) 460,911 1.1 % 20,000 20,000 500,911 -0- Table of Contents Edwards Family Trust UA DTD 5/18/06 Eileen Edwards TTEE 5,000 * -0- -0- 5,000 -0- Elliott Jr., James W. 100,000 0.2 % -0- -0- 100,000 -0- Ellison, Jae 455 * -0- -0- 455 -0- Emmons, Corey 100,000 0.2 % -0- -0- 100,000 -0- The Engler Family Living Trust UA DTD 2/2/1999 Alan & Terri Engler TTEE(36) 62,500 0.2 % 125,000 -0- 187,500 -0- Enutroff LLC (37) 2,476,582 6.1 % -0- -0- 2,476,582 -0- Epoch Financial Group Inc. 40,000 0.1 % -0- -0- 40,000 -0- Etherton, R.C. 100,000 0.2 % -0- -0- 100,000 -0- Equitec Specialists, LLC(38) -0- * 45,000 45,000 90,000 -0- Evans, Doug(39) 125,000 0.3 % 250,000 -0- 375,000 -0- Farina, Anthony(40) 62,500 0.2 % 125,000 -0- 187,500 -0- Feldman, Carl(41) -0- * 200,000 200,000 400,000 -0- The Fred Gumbinner Living Trust U/A DTD 10/23/2001 Fred Gumbinner TTEE( 42 ) 62,500 0.2 % 125,000 -0- 187 ,500 -0- Geller, Bruce 455 * -0- -0- 455 -0- Global Equity Funding, LLC( 43 ) 207,755 0.5 % -0- -0- 207,755 -0- Global Intelligence Network (4 4 ) 56,819 0.1 % -0- -0- 56,819 -0- Golway, Elizabeth A. 30,000 0.1 % -0- -0- 30,000 -0- Golway, John P. 30,000 0.1 % -0- -0- 30,000 -0- Godsey, Dan 50,000 0.1 % -0- -0- 50,000 -0- Grau, Scott Andrew 96,000 0.2 % -0- -0- 96,000 -0- Grau, Edward and Rose 2,000 * -0- -0- 2,000 -0- Greenberg, Adam(4 5 ) 75,000 0.2 % 150,000 -0- 225,000 -0- Greenway Capital LP(4 6 ) 314,795 0.8 % -0- -0- 314,795 -0- Griffin, Beverly S.(4 7 ) 113,637 0.3 % -0- -0- 113,637 -0- Griffith, Fred Carl 100,000 0.2 % -0- -0- 100,000 -0- Guest, Daryl P.(4 8 ) 25,000 0.1 % 50,000 -0- 75,000 -0- Gulledge, Scott 50,000 0.1 % -0- -0- 50,000 -0- Haas, John L. 100,000 0.2 % -0- -0- 100,000 -0- Hakman, Julie( 49 ) 113,637 0.3 % -0- -0- 113,637 -0- Hall, Spencer 100,000 0.2 % -0- -0- 100,000 -0- Hall, Tracy 100,000 0.2 % -0- -0- 100,000 -0- Hanrahan, Kathleen(1)( 50 ) 1,141,250 2.8 % 20,000 20,000 1,181,250 -0- Hard 4 Holdings LLC(51) -0- * 500,000 500,000 1,000,000 -0- Harm, Tom(52) -0- * 5,000 -0- 5,000 -0- Table of Contents Harper, Brent 33,334 0.1 % -0- -0- 33,334 -0- Harrison, Janice E. 25,000 0.1 % -0- -0- 25,000 -0- Heape, Jeffrey N. 50,000 0.1 % -0- -0- 50,000 -0- Helmsbridge Holdings Limited(53) -0- * 100,000 100,000 200,000 -0- Henderson, Tanya 50,000 0.1 % -0- -0- 50,000 -0- Hicks, Robert L.(54) -0- * 132,915 -0- 132,915 -0- Higgins, Gwendoline J. 9,091 * -0- -0- 9,091 -0- Hoffman, Michael C. 455 * -0- -0- 455 -0- Horton, John 100,000 0.2 % -0- -0- 100,000 -0- Hotwire Development LLC(55) 393,000 1.0 % -0- -0- 393,000 -0- Hughes, Paul 552,500 1.4 % -0- -0- 552,500 -0- Humphrey, Thomas J. 1,137 * -0- -0- 1,137 -0- Hutchins, Daniel F. 240,000 0.6 % -0- -0- 240,000 -0- James G. Miller Revocable Trust UA DTD 4/10/2003 James G. Miller TTEE 120,000 0.3 % -0- -0- 120,000 -0- John V. Lindsey, Jr. Rev. Trust DTD 9-19-02(56) 350,000 0.9 % 100,000 -0- 450,000 -0- Johnston, Brenda Cheryl 82,500 0.2 % -0- -0- 82,500 -0- JSL Kids Partners(57) -0- * 100,000 100,000 200,000 -0- Kansas Resou r ce Development Company(58) -0- * 250,000 -0- 250,000 -0- Kehoe, Lawrence Dean 50,000 0.1 % -0- -0- 50,000 -0- Kenerson, Charles V. 9,091 * -0- -0- 9,091 -0- Klion, Janet S. 682 * -0- -0- 682 -0- Kmak, Tom and Kathy JTWROS 85,000 0.2 % -0- -0- 85,000 -0- KRP2 LLC(59) 400,000 1.0 % -0- -0- 400,000 -0- Lambrecht, Corey (1)(60) 213,884 0.5 % 102,650 50,000 366,534 -0- Lee, Helen G. 2,000 * -0- -0- 2,000 -0- Loeffelbein, James (Jim) 50,000 0. 1 % -0- -0- 50,000 -0- Long, Charles 455 * -0- -0- 455 -0- Lucas, Robert R. 463,911 1.14 % -0- -0- 463,911 -0- Luskin, Brett(61) -0- * 100,000 100,000 200,000 -0- Luskin, Cary(23)(61) -0- * 100,000 100,000 200,000 -0- Luskin, Taylor(61) -0- * 100,000 100,000 200,000 -0- Lyster, Barbara A.(62) 2,500,000 6.1 % 5 , 00 0,000 -0- 7 ,5 0 0,000 -0- Maheu, Peter R. 113,637 0.3 % -0- -0- 113,637 -0- Malarchick, Tim & Charlotte JTWROS(63) 87,500 0.2 % 175,000 -0- 262,500 -0- Marano, Vincent(64) 62,500 0.2 % 125,000 -0- 187,500 -0- Table of Contents Marcus, Marlene(65) 75,000 0.2 % 150,000 -0- 225,000 -0- Marcus L. Wilson and Melissa J. Wilson, co-trustees of the Marcus Wilson Trust DTD 12/18/08 50,000 0.01 % -0- -0- 50,000 -0- Mark, Keith 100,000 0.2 % -0- -0- 100,000 -0- Massad Holdings LP(66) 62,500 0.2 % 125,000 -0- 187,500 -0- Massad, Mark(67) 62,500 0.2 % 125,000 -0- 187,500 -0- Mckague, Gary F. 796 * -0- -0- 796 -0- Merriman Capital, Inc.(68) -0- * 550,700 -0- 550,700 -0- Millennium Trust Company, LLC FBO Sandiv Rawat IRA(69) 61,250 0.1 % 122,500 -0- 183,750 -0- Miller, James G. (1)(70) 1,944,555 4.8 % 357,984 100,000 2,402,539 -0- Mitchell, Kenneth 100,000 0.2 % -0- -0- 100,000 -0- Mitchell, Sue 20,000 * -0- -0- 20,000 -0- Mitchell, W.B. 100,000 0.2 % -0- -0- 100,000 -0- Montgomery, Howard B. Jr. 5,000 * -0- -0- 5,000 -0- Monica Moll Trust UA DTD 02/16/1996 Monica Moll TTEE 150,000 0.4 % -0- -0- 150,000 -0- Morgan Stanley Smith Barney c/f William R. Shardlow IRA 200,000 0.5 % -0- -0- 200,000 -0- Moxy Trading LLC(71) 57,143 0.1 % -0- -0- 57,143 -0- Naegele, Zao E. 455 * -0- -0- 455 -0- Natale, Rod 19,445 * -0- -0- 19,445 -0- Nelson, Loren 5,000 * -0- -0- 5,000 -0- Nelson, Russ 455 * -0- -0- 455 -0- NKJ LLC(72) 75,000 0.2 % 150,000 -0- 225,000 -0- Newlin, Grier G.(73) 25,000 0.1 % 50,000 -0- 75,000 -0- Noble International Investments, Inc.(74) -0- * 9,300 -0- 9,300 -0- Nolton, Jim(1)(75) 500,479 1.2 % 190 ,000 -0- 690 ,479 -0- Nolton Enterprises(76) -0- * 40,000 40,000 80,000 -0- O Herron, Douglas & Nancy 18,182 * -0- -0- 18,182 -0- Osborn, Michael 200,000 0.5 % -0- -0- 200,000 -0- Padjen, Gary 122,500 0.3 % -0- -0- 122,500 -0- Palmer, Darrel Gene 251,541 0.6 % -0- -0- 251,541 -0- Parsley, Bert 28,571 0.1 % -0- -0- 28,571 -0- Partner, Arthur L. Shekell 9,091 * -0- -0- 9,091 -0- Pase, Stuart Irving & Sharon Kay JTWROS 212,000 0.5 % -0- -0- 212,000 -0- Pinnacle Family Office Investments, L.P.(77) -0- * 2,000,000 2,000,000 4,000,000 -0- Table of Contents Precept Capital Master Fund, GP(78) -0- * 450,000 450,000 900,000 -0- The Precept Fund II, LP(79) -0- * 250,000 250,000 500,000 -0- Price, James K.(80) -0- * 200,000 200,000 400,000 -0- Quinn, Ryan 1,137 * -0- -0- 1,137 -0- RBC Capital Markets LLC Cust FBO Thomas Kmak IRA 400,000 1.0 % -0- -0- 400,000 -0- Red Line Capital LLC.(81) -0- * 133,511 -0- 133,511 -0- Roberson, Alan L & Wyvonne JTWROS 100,000 0.2 % -0- -0- 100,000 -0- Robert K Green Trust 637,250 1.6 % -0- -0- 637,250 -0- Rodrock Generations (82) 100,000 0.2 % -0- -0- 100,000 -0- Rojas, Jose 91,200 0.2 % -0- -0- 91,200 -0- Run Management, LLC(83) 50,000 0.1 % -0- -0- 50,000 -0- Sandor Capital Master Fund(84) -0- * 400,000 400,000 800,000 -0- Saugstad, Monique(85) -0- * 33,229 -0- 33,229 -0- Serafino, Delores 910 * -0- -0- 910 -0- Serrato, Jarrod(86) -0- * 9,000 -0- 9,000 -0- Serrato, Michael A.(87) 62,500 0.2 % 125,000 -0- 187,500 -0- Serrato, Thomas R.(88) 100,000 0.2 % 200,000 -0- 300,000 -0- Shea, Kevin 19,445 * -0- -0- 19,445 -0- Shrader, Kim 20,000 * -0- -0- 20,000 -0- Shrader, Ray 20,000 * -0- -0- 20,000 -0- Skorija, Tim 35,000 0.1 % -0- -0- 35,000 -0- Southwell Capital, LP(89) -0- * 600,000 600,000 1,200,000 -0- Stegman, Kahtleen 300,000 0.7 % -0- -0- 300,000 -0- Sterling Trust FBO Connie C. Griffith IRA 100,000 0.2 % -0- -0- 100,000 -0- Sterling, Jennifer(90) 50,000 0.1 % 100,000 -0- 150,000 -0- STI Harities Holdings(91) 569 * -0- -0- 569 -0- Stern, William(92) -0- * 25,000 -0- 25,000 -0- Stoecklein Law Group(93) 23,548 * -0- -0- 23,548 -0- Strain, Arlene & George JTTEN 27,273 * -0- -0- 27,273 -0- Sularski, Matthew 13,637 * -0- -0- 13,637 -0- Sularski, Robert 4,546 * -0- -0- 4,546 -0- Sularski, Stephen 9,092 * -0- -0- 9,092 -0- Sundberg, Nicholas(94) 55,000 0.1 % 110,000 -0- 165,000 -0- Sundberg, Stacie(95) 50,000 0.1 % 100,000 -0- 150,000 -0- Tansey, Brian J. 50,000 0.1 % -0- -0- 50,000 -0- Tarwater, Amy 2,500 * -0- -0- 2,500 -0- Tate Jr., Ray J. 100,000 0.2 % -0- -0- 100,000 -0- 1 Current officer or director of the Company. 2 Based upon 40,842,560 shares of common stock issued and outstanding. 3 Figures are rounded to the nearest tenth of a percent. 4 John R. Exley III has voting, investment and dispositive power over the shares of common stock owned by Acorn Management Partners, LLC. 5 Michael Pate, has voting, investment and dispositive power over the shares of common stock owned by AP-ID, Incorporated. Michael Pate was a former director of the Company from June 2007 through November 2010. 6 Includes 100,000 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 100,000 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 7 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through July 29, 2016; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through July 29, 2018. 8 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through June 11, 2016; Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through June 11, 2018; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 9 Includes 125,000 Class A Warrants to purchase shares of common stock at $0.55 per share through November 19, 2016; and 125,000 Class B Warrants to purchase shares of common stock at $0.75 per share through November 19, 2018. 10 Dylan Arter is the managing member of Archon Global Ventures and has voting, investment and dispositive power over the shares of common stock owned by Archon Global Ventures. 11 Kelly Bast, has voting, investment and dispositive power over the shares of common stock owned by ARGH LLC. 12 Robert H. Alpert has voting, investment and dispositive power over the securities owned by Atlas Allocation Fund L.P. Includes 750,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 250,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 750,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $750,000 convertible debenture; 250,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $250,000 convertible debenture; 1,500,000 shares of common stock issuable upon conversion of the $750,000 convertible debenture; and 500,000 shares of common stock issuable upon conversion of the $250,000 convertible debenture. 13 Dennis Nelson, has voting, investment and dispositive power over the shares of common stock owned by Attorney s Process & Investigation Services, Inc. Dennis Nelson was a former director of the Company from June 2007 through November 2010. 14 Joe Johnston, has voting, investment and dispositive power over the shares of common stock owned by BBD Development Holdings LLC. 15 Includes 25,000 warrants to purchase shares of common stock at $0.25 per share through April 26, 2015. 16 Includes 125,000 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 125,000 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 17 Includes 125,000 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 125,000 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 18 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through January 2, 2016; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through January 2, 2018. 19 Richard S. Strong has voting, investment and dispositive power over the securities owned by Calm Waters Partnership. Includes 500,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 500,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $500,000 convertible debenture; and 500,000 shares of common stock issuable upon conversion of the $500,000 convertible debenture. 20 Includes 750,000 Class A Warrants to purchase shares of common stock at $0.55 per share through October 10, 2016; and 250,000 Class B Warrants to purchase shares of common stock at $0.75 per share through October 10, 2018. 21 Christi Mottola-Bettingen has voting, investment and dispositive power over the securities owned by CCG/Mottola Communciations. 22 Cary Luskin has voting, investment and dispositive power over the securities owned by CK Management LLC. Includes 1,000,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 1,000,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $1,000,000 convertible debenture; and 340,000 shares of common stock issuable upon conversion of the $1,000,000 convertible debenture. 23 Includes 10,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 10,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $10,000 convertible debenture; and 20,000 shares of common stock issuable upon conversion of the convertible debenture. 24 John Loeffelbein has voting, investment and dispositive power over the securities owned by Coal Creek Energy, LLC. Includes 100,000 Class A Warrants to purchase shares of common stock at $0.55 per share through December 30, 2016; and 100,000 Class B Warrants to purchase shares of common stock at $0.75 per share through December 30, 2018. 25 John Loeffelbein has voting, investment and dispositive power over the securities owned by Coal Creek, LLC. 26 Includes 543,301 warrants to purchase shares of common stock at $0.40 per share through August 31, 2016; includes 50,000 warrants to purchase shares of common stock at $0.40 per share through September 17, 2016; 400,000 warrants to purchase shares of common stock at $0.50 per share through February 23, 2017; 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through August 28, 2015; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through August 28, 2017; 340,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 340,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $170,000 convertible debenture; and 340,000 shares of common stock issuable upon conversion of the $170,000 convertible debenture. 27 Mark Haas, has voting, investment and dispositive power over the shares of common stock owned by Coconut Drilling, Inc. 28 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 29 Cranshire Capital Advisors, LLC ( CCA ) is the investment manager of Cranshire Capital Master Fund, Ltd. ( Cranshire Master Fund ) and has voting control and investment discretion over securities held by Cranshire Master Fund. Mitchell P. Kopin, the president, the sole member, and the sole member of the Board of Managers of CCA, has voting control over CCA. As a result, each of Mr. Kopin and CCA may be deemed to have beneficial ownership (as determined under Section 13(d) of the Securities Exchange Act of 1934, as amended) of the securities held by Cranshire Master Fund. Includes 52,500 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 52,500 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $52,500 convertible debenture; and 105,000 shares of common stock issuable upon conversion of the convertible debenture. 30 Includes 100,000 Class A Warrants to purchase shares of common stock at $0.55 per share through August 28, 2015; 100,000 Class B Warrants to purchase shares of common stock at $0.75 per share through August 28, 2017. 31 Gary Padjen, has voting, investment and dispositive power over the securities owned by DOMCO, LLC. 32 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 33 Monica Moll, has voting, investment and dispositive power over the shares of common stock owned by East Sand, LLC. 34 Kyle Edwards , a current director of the Company, has voting, investment and dispositive power over the securities owned by Edwards Group Int l. Includes 20,000 warrants to purchase shares of common stock at $0.25 per share through January 11, 2015. 35 Includes 10,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 10,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $10,000 convertible debenture; and 20,000 shares of common stock issuable upon conversion of the convertible debenture 36 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through March 18, 2016; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through March 18, 2018. 37 James Loeffelbein, has voting, investment and dispositive power over the shares of common stock owned by Enutroff LLC 38 Cranshire Capital Advisors, LLC ("CCA") is the investment manager of a managed account for Equitec Specialists, LLC ("Equitec") and has voting control and investment discretion over securities held in by Equitec in such managed account. Mitchell P. Kopin ("Mr. Kopin"), the president, the sole member and the sole member of the Board of Managers of CCA, has voting control over CCA. As a result, each of Mr. Kopin and CCA may be deemed to have beneficial ownership (as determined under Section 13(d) of the Securities Exchange Act of 1934, as amended) of the securities held by Equitec in such managed account. CCA is also the investment manager of Cranshire Capital Master Fund, Ltd. ("Cranshire Master Fund"). Mr. Kopin, the president, the sole member and the sole member of the Board of Managers of CCA, has voting control over CCA. As a result, each of Mr. Kopin and CCA may be deemed to have beneficial ownership (as determined under Section 13(d) of the Securities Exchange Act of 1934, as amended) of the securities held by Cranshire Master Fund, that are described in footnote 29. Equitec is an affiliate of a broker-dealer. Equitec acquired the shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the shares and warrants described herein, Equitec did not have any arrangements or understandings with any person to distribute such securities. Includes 22,500 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 22,500 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $22,500 convertible debenture; and 45,000 shares of common stock issuable upon conversion of the $22,500 convertible debenture. 39 Includes 125,000 Class A Warrants to purchase shares of common stock at $0.55 per share through September 26, 2015; 125,000 Class B Warrants to purchase shares of common stock at $0.75 per share through September 26, 2017. 40 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 41 Includes 100,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 100,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $100,000 convertible debenture; and 100,000 shares of common stock issuable upon conversion of the $100,000 convertible debenture. 42 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through November 19, 2016; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through November 19, 2018. 43 H. Michael Burstein, has voting, investment and dispositive power over the shares of common stock owned by Global Equity Funding, LLC. 44 Peter Maheu, has voting, investment and dispositive power over the shares of common stock owned by Global Intelligence Network. Peter Maheu was a former director of the Company from June 2007 through November 2010. 45 Includes 75,000 Class A Warrants to purchase shares of common stock at $0.55 per share through November 19, 2016; and 75,000 Class B Warrants to purchase shares of common stock at $0.75 per share through November 19, 2018. 46 Robert K. Green is the General Partner of Greenway Capital, LP. As a result of the foregoing, he may be deemed to have beneficial ownership (as determined under Section 13(d) of the Securities Exchange Act of 1934, as amended) of the shares of common stock beneficially owned by Greenway Capital, LP. 47 Beverly Griffith was a former director of the Company from June 2007 through November 2010. 48 Includes 25,000 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 25,000 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 49 Julie Hakman was a former director and the Company s secretary from June 2007 through November 2010. 50 Includes 10,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 10,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $10,000 convertible debenture; and 20,000 shares of common stock issuable upon conversion of the convertible debenture 51 Reid S. Walker has voting, investment and dispositive power over the securities owned by Hard 4 Holdings, LLC. Includes 250,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 250,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $250,000 convertible debenture; and 500,000 shares of common stock issuable upon conversion of the $250,000 convertible debenture. 52 Mr. Harm is a currently registered FINRA registered representative. Includes 5,000 managing dealer warrants to purchase shares of common stock at $0.40 per share through November 19, 2023. Mr. Harm acquired the shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the shares and warrants described herein, Mr. Harm did not have any arrangements or understandings with any person to distribute such securities. 53 Anthony Heller is the President of Helmsbridge Holdings Limited and has sole voting and investment power over the shares held thereby. Includes 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $50,000 convertible debenture; and 100,000 shares of common stock issuable upon conversion of the convertible debenture. 54 Mr. Hicks is a currently registered FINRA registered representative. Includes 132,915 managing dealer warrants to purchase shares of common stock at $0.40 per share through November 19, 2023. Mr. Hicks acquired the shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the shares and warrants described herein, Mr. Hicks did not have any arrangements or understandings with any person to distribute such securities. 55 Jeff Doss has voting and investment power over the shares owned by Hotwire Development LLC. 56 Includes 100,000 warrants to purchase shares of common stock at $0.40 per share through September 30, 2016 57 John S. Lemak, Manager of JSL Kids Partners, has voting and investment power over the shares it is offering for resale. Includes 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $50,000 convertible debenture; and 100,000 shares of common stock issuable upon conversion of the convertible debenture. 58 C. Stephen Cochennet, the CEO/president of the Company, has voting, investment and dispositive power over the securities owned by Kansas Resource Development Company. 59 Kenneth Phillips, has voting, investment and dispositive power over the shares of common stock owned by KRP2, LLC. 60 Includes 52,650 warrants to purchase shares of common stock at $0.40 per share through August 31, 2016; 25,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 25,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $25,000 convertible debenture; 50,000 shares of common stock issuable upon conversion of the $25,000 convertible debenture. 61 Includes 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $50,000 convertible debenture; and 100,000 shares of common stock issuable upon conversion of the $50,000 convertible debenture. 62 Includes 625,000 Class A Warrants to purchase shares of common stock at $0.55 per share through March 18, 2016; 625,000 Class A Warrants to purchase shares of common stock at $0.55 per share through May 5, 2016; 1,250,000 Class A Warrants to purchase shares of common stock at $0.55 per share through November 11, 2016; 625,000 Class B Warrants to purchase shares of common stock at $0.75 per share through March 18, 2018; 625,000 Class B Warrants to purchase shares of common stock at $0.75 per share through May 5, 2018; 1,250,000 Class B Warrants to purchase shares of common stock at $0.75 per share through November 11, 2018. 63 Includes 87,500 Class A Warrants to purchase shares of common stock at $0.55 per share through June 11, 2016; and 87,500 Class B Warrants to purchase shares of common stock at $0.75 per share through June 11, 2018. 64 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 65 Includes 75,000 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 75,000 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 66 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through November 11, 2016; and 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through November 11, 2018. 67 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through April 29, 2016; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through April 29, 2018. 68 Jon Merriman is the CEO of Merriman Capital, Inc. Mr. Merriman has voting and dispositive power with respect to the securities.Merriman Captial, Inc. is a currently registered FINRA broker/dealer. Includes 550,700 managing dealer warrants to purchase shares of common stock at $0.50 per share through June 1, 2019. 69 Includes 61,250 Class A Warrants to purchase shares of common stock at $0.55 per share through November 11, 2016; and 61,250 Class B Warrants to purchase shares of common stock at $0.75 per share through November 11, 2018. 70 Includes 52,984 warrants to purchase shares of common stock at $0.40 per share through August 31, 2016; includes 30,000 warrants to purchase shares of common stock at $0.40 per share through September 18, 2016; includes 50,000 warrants to purchase shares of common stock at $0.50 per share through February 11, 2017; 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through November 14, 2015; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through November 14, 2017; 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 50,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $50,000 convertible debenture; 100,000 shares of common stock issuable upon conversion of the $50,000 convertible debenture. 71 Robert Lucas, has voting, investment and dispositive power over the shares of common stock owned by Moxy Trading, LLC. 72 Includes 75,000 Class A Warrants to purchase shares of common stock at $0.55 per share through November 19, 2016; and 75,000 Class B Warrants to purchase shares of common stock at $0.75 per share through November 19, 2018. 73 Includes 25,000 Class A Warrants to purchase shares of common stock at $0.55 per share through November 19, 2016; and 25,000 Class B Warrants to purchase shares of common stock at $0.75 per share through November 19, 2018. 74 Noble International Investments, Inc. is a currently registered FINRA broker/dealer. Includes 9,300 managing dealer warrants to purchase shares of common stock at $0.50 per share through June 1, 2019. 75 Includes 20,000 warrants to purchase shares of common stock at $0.25 per share through January 11, 2015; 45,000 warrants to purchase shares of common stock at $0.40 per share through August 31, 2016; 25,000 warrants to purchase shares of common stock at $0.50 per share through February 23, 2017; 50,000 Class A Warrants to purchase shares of common stock at $0.55 per share through November 6, 2015; and 55,000 Class B Warrants to purchase shares of common stock at $0.75 per share through November 6, 2017. 76 Jim Nolton has voting, investment and dispositive power over the securities owned by Nolton Enterprises. Includes 20,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 20,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $20,000 convertible debenture; and 40,000 shares of common stock issuable upon conversion of the $20,000 convertible debenture. 77 Pinnacle Family Office, L.L.C., or Pinnacle Office, is the general partner of Pinnacle Office Investments, L.P., or Pinnacle Investments. Barry M. Kitt, as manager of Pinnacle Office, holds voting and investment power over these securities. Includes 1,000,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 1,000,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $1,000,000 convertible debenture; and 340,000 shares of common stock issuable upon conversion of the $1,000,000 convertible debenture. 78 D. Blair Baker is the Managing Member of Precept Management, LLC, which is the general partner of Precept Capital Management, LP, which in turn is the agent and attorney in fact of Precept Capital Master Fund. Precept Management, LLC has voting and dispositive power over the securities held by Precept Capital Master Fund. Includes 225,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 225,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $225,000 convertible debenture; and 450,000 shares of common stock issuable upon conversion of the convertible debenture. 79 D. Blair Baker is the President and CEO of Precept Management, LLC, which is the general partner of Precept Capital Management, LP, which is the general partner of The Precept Fund II, LP. Precept Management, LLC has voting and dispositive power over the securities held by The Precept Fund II, LP. Includes 125,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 125,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $125,000 convertible debenture; and 250,000 shares of common stock issuable upon conversion of the convertible debenture. 80 Includes 100,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 100,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $100,000 convertible debenture; and 200,000 shares of common stock issuable upon conversion of the convertible debenture. 81 James Stantey has voting, investment and dispositive power over the securities held by Red Line Capital LLC. and is a currently registered FINRA registered representative. Includes 133,511 managing dealer warrants to purchase shares of common stock at $0.40 per share through November 19, 2023. Red Line acquired the shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the shares and warrants described herein, Red Line did not have any arrangements or understandings with any person to distribute such securities. 82 Brian Rodrock, has voting, investment and dispositive power over the shares of common stock owned by Rodrock Generations. 83 Dr. Nehal Patel, has voting, investment and dispositive power over the shares of common stock owned by Run Management, LLC. 84 Richard Lemak holds voting and dispositive power over shares held by Sandor Capital Master Fund. Includes 200,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 200,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $200,000 convertible debenture; and 400,000 shares of common stock issuable upon conversion of the convertible debenture. 85 Ms. Saugstad is a currently registered FINRA registered representative. Includes 33,229 managing dealer warrants to purchase shares of common stock at $0.40 per share through November 19, 2023. Mr. Saugstad acquired the shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the shares and warrants described herein, Mr. Saugstad did not have any arrangements or understandings with any person to distribute such securities. 86 Mr. Serrato is a currently registered FINRA registered representative. Includes 9,000 managing dealer warrants to purchase shares of common stock at $0.40 per share through November 19, 2023. Mr. Serrato acquired the shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the shares and warrants described herein, Mr. Serrato did not have any arrangements or understandings with any person to distribute such securities. 87 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through April 29, 2016; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through April 29, 2018. 88 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through March 18, 2016; 37,500 Class A Warrants to purchase shares of common stock at $0.55 per share through June 11, 2016; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through March 18, 2018; and 37,500 Class B Warrants to purchase shares of common stock at $0.75 per share through June 11, 2018. 89 Wilson Jaeggli has voting, investment and dispositive power over the shares of common stock owned by Southwell Capital, LP. Includes 300,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 300,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $300,000 convertible debenture; and 300,000 shares of common stock issuable upon conversion of the convertible debenture. 90 Includes 50,000 Class A Warrants to purchase shares of common stock at $0.55 per share through January 9, 2016; 50,000 Class B Warrants to purchase shares of common stock at $0.75 per share through January 9, 2018. 91 Anna Kiriacou, has voting, investment and dispositive power over the shares of common stock owned by STI Harities Holdings. 92 Includes 25,000 warrants to purchase shares of common stock at $0.25 per share through March 27, 2015. 93 Donald J. Stoecklein, has voting, investment and dispositive power over the shares of common stock owned by Stoecklein Law Group. 94 Includes 55,000 Class A Warrants to purchase shares of common stock at $0.55 per share through August 28, 2015; 55,000 Class B Warrants to purchase shares of common stock at $0.75 per share through August 28, 2017. 95 Includes 50,000 Class A Warrants to purchase shares of common stock at $0.55 per share through August 28, 2015; 50,000 Class B Warrants to purchase shares of common stock at $0.75 per share through August 28, 2017. 96 Includes 250,000 Class A Warrants to purchase shares of common stock at $0.55 per share through June 11, 2016; and 250,000 Class B Warrants to purchase shares of common stock at $0.75 per share through June 11, 2018. 97 Paul Brugger, has voting, investment and dispositive power over the shares of common stock owned by The Brugger Family Trust. 98 Includes 125,000 Class A Warrants to purchase shares of common stock at $0.55 per share through July 29, 2016; and 125,000 Class B Warrants to purchase shares of common stock at $0.75 per share through July 29, 2018. 99 Gwendoline J. Higgins, has voting, investment and dispositive power over the shares of common stock owned by The Higgins Heritage Trust. 100 Allan R. Lyons is the managing member of the general partner of Vestal Venture Capital and has voting, investment and dispositive power over the shares of common stock owned by Vestal Venture Capital. Includes 80,000 Class C Warrants to purchase shares of common stock at $0.60 per share through June 1, 2019; 80,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $80,000 convertible debenture; and 160,000 shares of common stock issuable upon conversion of the convertible debenture. 101 Mr. Watson is a currently registered FINRA registered representative. Includes 400,533 managing dealer warrants to purchase shares of common stock at $0.40 per share through November 19, 2023. Mr. Watson acquired the shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the shares and warrants described herein, Mr. Watson did not have any arrangements or understandings with any person to distribute such securities. 102 Includes 25,000 warrants to purchase shares of common stock at $0.25 per share through January 11, 2015. 103 Greg Whitaker, has voting, investment and dispositive power over the shares of common stock owned by Whitaker & Sons, LLC. 104 Includes 62,500 Class A Warrants to purchase shares of common stock at $0.55 per share through April 29, 2016; 62,500 Class B Warrants to purchase shares of common stock at $0.75 per share through April 29, 2018. 105 Includes 25,000 Class A Warrants to purchase shares of common stock at $0.55 per share through October 24, 2016; and 25,000 Class B Warrants to purchase shares of common stock at $0.75 per share through October 24, 2018. 106 Wolverine Asset Management, LLC ("WAM") is the investment manager of Wolverine Flagship Fund Trading Limited and has voting and dispositive power over these securities. The sole member and manager of WAM is Wolverine Holdings, L.P. ("Wolverine Holdings"). Robert R. Bellick and Christopher L. Gust may be deemed to control Wolverine Trading Partners, Inc. ("WTP"), the general partner of Wolverine Holdings. Each of Mr. Bellick, Mr. Gust, WTP, Wolverine Holdings and WAM disclaims beneficial ownership of these securities. Includes 1,500,000 Class C Warrants to purchase shares of common stock at $0.60 per share through May 26, 2019; 1,500,000 Class C Warrants to purchase shares of common stock at $0.60 per share issuable upon conversion or maturity of a $1,500,000 convertible debenture; and 3,000,000 shares of common stock issuable upon conversion of the $1,500,000 convertible debenture. Table of Contents PLAN OF DISTRIBUTION Each Selling Stockholder (the Selling Stockholders ) of the securities and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their securities covered hereby on the OTC Bulletin Board, OTCQB or any other stock exchange, market or trading facility on which the securities are traded or in private transactions. These sales may be at fixed or negotiated prices. A Selling Stockholder may use any one or more of the following methods when selling securities: ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction; purchases by a broker-dealer as principal and resale by the broker-dealer for its account; an exchange distribution in accordance with the rules of the applicable exchange; privately negotiated transactions; settlement of short sales entered into after the effective date of the registration statement of which this prospectus is a part; in transactions through broker-dealers that agree with the Selling Stockholders to sell a specified number of such securities at a stipulated price per security; through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; a combination of any such methods of sale; or any other method permitted pursuant to applicable law. The Selling Stockholders may also sell securities under Rule 144 under the Securities Act of 1933, as amended (the Securities Act ), if available, rather than under this prospectus. Broker-dealers engaged by the Selling Stockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a markup or markdown in compliance with FINRA IM-2440. In connection with the sale of the securities or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they assume. The Selling Stockholders may also sell securities short and deliver these securities to close out their short positions, or loan or pledge the securities to broker-dealers that in turn may sell these securities. The Selling Stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction). Table of Contents The Selling Stockholders and any broker-dealers or agents that are involved in selling the securities may be deemed to be underwriters within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. Each Selling Stockholder has informed us that it does not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the securities. In no event shall any broker-dealer receive fees, commissions and markups which, in the aggregate, would exceed eight percent (8%). Because Selling Stockholders may be deemed to be underwriters within the meaning of the Securities Act, they will be subject to the prospectus delivery requirements of the Securities Act including Rule 172 thereunder. In addition, any securities covered by this prospectus which qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than under this prospectus. The Selling Stockholders have advised us that there is no underwriter or coordinating broker acting in connection with the proposed sale of the resale securities by the Selling Stockholders. We agreed to keep this prospectus effective until the earlier of (i) the date on which the securities may be resold by the Selling Stockholders without registration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement for the Parent to be in compliance with the current public information under Rule 144 under the Securities Act or any other rule of similar effect or (ii) all of the securities have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect. The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with. Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution. In addition, the Selling Stockholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of securities of the common stock by the Selling Stockholders or any other person. We will make copies of this prospectus available to the Selling Stockholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act). We will pay all expenses of the registration of these shares, including, without limitation, Securities and Exchange Commission filing fees and expenses of compliance with state securities or blue sky laws; provided, however, that the Selling Stockholder will pay all underwriting discounts, commissions and concessions and brokers or agents commissions and concessions or selling commissions and concessions, if any. We will indemnify the Selling Stockholder against liabilities, including some liabilities under the Securities Act, in accordance with a registration rights agreement we have with the Selling Stockholder, or the Selling Stockholder will be entitled to contribution. We may be indemnified by the Selling Stockholder against civil liabilities, including liabilities under the Securities Act, that may arise from any written information furnished to us by the Selling Stockholder specifically for use in this prospectus, in accordance with a registration rights agreement we have with the Selling Stockholder, or we may be entitled to contribution. Once sold under the registration statement, of which this prospectus forms a part, these shares will be freely tradable in the hands of persons other than our affiliates. WHERE YOU CAN FIND MORE INFORMATION We have filed a registration statement on Form S-1 under the Securities Act with the SEC with respect to the common stock offered by this prospectus. This prospectus does not include all of the information contained in the registration statement or the exhibits and schedules filed therewith. You should refer to the registration statement and its exhibits for additional information. Whenever we make reference in this prospectus to any of our contracts, agreements or other documents, the references are not necessarily complete and you should refer to the exhibits attached to the registration statement for copies of the actual contract, agreement or other document. Table of Contents TABLE OF CONTENTS SUMMARY 1 THE OFFERING 2
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001434110_pledge_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001434110_pledge_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..3b4cc1372754204fadf1a1808fd4577b78ed99b9
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary is not intended to be complete and does not contain all of the information that you should consider before deciding to invest in our securities. We urge you to read this entire prospectus carefully, especially the "Risk Factors" section beginning on page 5. Except where the context requires otherwise, in this prospectus the terms "Company," "Propell," "we," "us" and "our" refer to Propell Technologies Group, Inc., a Delaware corporation. Company Overview Overview Our Company Through our wholly owned subsidiary, Novas Energy USA, Inc. ("Novas"), we are engaged in the commercial application of a proprietary "Plasma-Pulse Technology" to enhance the recovery of oil for which we have a perpetual exclusive license to utilize in the United States and Mexico. We began introducing the technology in the United States on a limited basis in March 2013. Prior to March 2013, all of our revenue had been derived from our e-commerce and other lines of business. Since February 4, 2013, following the closing of the Share Exchange Agreement with the shareholders of Novas, under which we acquired all of the outstanding equity securities of Novas in exchange for 100,000,000 shares of our common stock, our primary focus has shifted to the further development of our licensed oil recovery technology. The oil recovery technology used by Novas is based on an exclusive, perpetual royalty-bearing license to engage in the commercial application of the proprietary "Plasma-Pulse Technology" (the "Plasma Pulse Technology") entered into on January 30, 2013, with Novas Energy Group Limited ("Licensor") which granted Novas the right to use the Plasma Pulse Technology in the United States to enhance oil production. The license agreement provides Novas with the right to practice the licensed process and to utilize the Plasma Pulse Technology to provide services to third parties and for ourselves as well, and to sublicense the technology in the United States. In March 2014, the license was amended to, among other things, increase the territory in which Novas can practice the licensed process and utilize the Technology to include Mexico. Although new to the United States and Mexico, the Plasma Pulse Technology has been successfully utilized outside of the United States and Mexico for several years. The Licensor has filed for patent protection of the Plasma Pulse Technology in the United States. The process utilizes a down-hole tool that is lowered into vertical wellbores to the perforated oil producing zone. When initiated, the tool delivers metallic plasma-generated, directed, non-linear, wide-band elastic oscillations at resonance frequencies to enhance oil production using the tool developed by the Licensor and enhanced by Novas. The Plasma Pulse Technology is suitable for oil wells as deep as 12,000 feet. By optimizing production efficiency combined with the resulting increased oil production we expect to extend the economic life of mature oil fields and to recover previously unrecoverable oil efficiently. Since March 19, 2013, we have used the Plasma Pulse Technology to treat thirty seven oil wells located in seven states; Louisiana, Oklahoma, Kansas, Texas, California, Tennessee and Wyoming. The Technology has been shown to increase oil production in the majority of the wells that we have treated. The initial results of this treatment have been very encouraging, however the results on the wells treated may not be indicative of the results of treatment on additional wells. As such, we are continuing to monitor closely the longer-term results while, based upon the prior success from the use of Plasma-Pulse Technology outside of the United States, we expect the positive data from the treated wells in the United States to continue. We currently have five tools that we use to perform the treatments, of which four only work in vertical wells with a minimum of 5 &frac12;-inch casings and not in horizontal wells. We have developed a tool to treat 4 &frac12;-inch cased wells and have recently began treating wells with the new tool. In August 2013, we signed one Oil Services Revenue Sharing Agreement to treat up to ten wells in Creek County Oklahoma and thus far have treated four wells under the agreement, which four wells are included in the thirty one oil wells mentioned above. We do not expect to treat further wells under this agreement. The agreement provides that Novas pays for all expenses related to the treatment and is reimbursed for such expenses from the initial funds received from the increase in production until Novas expenses are paid in full and then Novas will receive 49% of the increased oil production revenue for a twelve month period after treatment of the wells. We received revenue from these treated wells in the fourth quarter of 2013 and revenue from the treatment of other wells in 2014. We also completed treatment of seven wells in Oklahoma for a service fee. We expect to continue to offer our services to independent oil wells based on our joint venture model in which we receive a percentage of the revenue that our customers derive from the additional production resulting from the use of the Technology. We also offer our services on a fee based model and charge a service fee for use of the Technology as opposed to a percentage of revenue. In addition, we may acquire wells and use the Technology on our acquired wells to increase their production. Our anticipated customers are the owners of independent oil wells. In order to allow us to fully focus on our oil recovery business, in October 2013, we entered into a management agreement with a third party for the operation of our e-commerce business. The terms of the management agreement provided that the third party would manage the operation of our e-commerce line of business and that the third party would be entitled to a fee equal to the revenue derived from the operations less a royalty of 10% of the net profit, if any that would be paid to us. Inasmuch as the e-commerce line of business was not profitable after taking into account general and administrative expenses and other expenses and we believed that we did not have the finances or personnel available to us to promote such business line or increase sales, in December 2013, we disposed of this business for a consideration of 10% of the net profits of the business, up to a maximum of $100,000 earned over the next three years ending December 31, 2014, 2015 and 2016. In addition, effective December 31, 2013, in order to improve our balance sheet, we disposed of our wholly owned subsidiary, Crystal Magic, Inc., which had been inactive since June 2010 and sold the stock of Crystal Magic, Inc. to a third party for nominal consideration. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS DECLARED EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. SUBJECT TO COMPLETION, DATED OCTOBER 14, 2014 PRELIMINARY PROSPECTUS PROPELL TECHNOLOGIES GROUP, INC. 12,684,494 Shares of Common Stock This prospectus relates to the resale by the investors listed in the section titled "Selling Stockholders", and we refer to the investors as the Selling Stockholders (the "Selling Stockholders") of up to 12,684,494 shares of our common stock, par value $0.001 per share (the "Shares"), of which 7,353,329 shares of common stock are currently outstanding and 5,331,165 shares of common stock are issuable upon exercise of warrants (the "Warrants"). The Shares and Warrants were issued to the Selling Stockholders in connection with a private placement offering we completed on August 8, 2014 (the "Private Placement"). Included in the 5,331,165 shares of common stock issuable upon the exercise of the Warrants are (i) 3,676,666 shares of common stock issuable upon the exercise of warrants issued to investors in the private placement at an exercise price of $0.25 per share, and (ii) 1,654,499 shares of common stock issuable upon the exercise of the warrants issued and to be issued to the placement agent in the Private Placement and its designees (the "Agent Warrants"). The Agent Warrants are exercisable for 1,102,999 units at an exercise price of $0.15 per unit, each unit consisting of one share of common stock and a second warrant to purchase a half of a share of common stock at an exercise price of $0.25 per share. We are registering the resale of the Shares as required by the Registration Rights Agreement we entered into with the Selling Stockholders in connection with the Private Placement (the "Registration Rights Agreement") and our agreement with the placement agent. The Selling Stockholders may offer and sell or otherwise dispose of the Shares described in this prospectus from time to time through public or private transaction at prevailing market prices, at prices related to such prevailing market prices, at varying prices determined at the time of sale, at negotiated prices, or at fixed prices. See "Plan of Distribution" beginning on page 46 for more information. We will not receive any of the proceeds from the Shares sold by the Selling Stockholders. Our common stock became eligible for trading on the OTCQB on April 22, 2010. Our common stock is quoted on the OTCQB under the symbol "PROP". The closing price of our stock on October 10, 2014 was $0.20. Investing in our securities involves a high degree of risk. See "Risk Factors" beginning on page 5 of this prospectus for more information. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus or the prospectus to which it relates is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is October ___, 2014. To date, we derived $153,077 in revenue from our oil enhancement business. We have financed our operations primarily from sales of our securities, both debt and equity, and to a lesser extent revenue from operations and we expect to continue to obtain required capital in a similar manner. Novas has financed its operations from loans it has received, which the majority of these loans were recently converted into shares of our common stock. We have incurred an accumulated deficit of $8,024,786 through June 30, 2014 and there can be no assurance that we will be able to achieve profitability. Our principal offices are located at 1701 Commerce Street, Houston, Texas 77002. Our telephone number is (713) 227-0480. Our fiscal year end is December 31.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001438964_zoosk-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001438964_zoosk-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..ce4ca828fdb7ce7bb610f0721a2eaffb5c1a46ab
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001438964_zoosk-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained in greater detail elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. You should read the entire prospectus carefully before making an investment in our common stock. You should carefully consider, among other things, our consolidated financial statements and the related notes and the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus. ZOOSK, INC. Overview We are a leading global online dating platform with over 27 million members, including approximately 721,000 subscribers, across 80 countries as of March 31, 2014.* We help our members date smarter by leveraging data generated by their actions on our platform. Our proprietary Behavioral Matchmaking engine continuously learns from the clicks, messaging and other actions of our members in order to deliver connections that are predicted to result in mutual attraction. These connections occur on our unified global platform, allowing our members to discover and communicate with each other from their mobile phones, tablets or personal computers. We provide our members with highly personalized online dating experiences through easy-to-use features and adaptive technology. We were the #1 grossing dating app and a top 25 grossing app on the iPhone in the United States on March 31, 2014. Our solution is offered to our members worldwide through our single brand and is localized in 25 languages. We launched in 2007 with the belief that online dating would become so common that people would simply think of it as dating. Traditionally, it was difficult for singles to discover and connect with each other because they were limited by social circles, geography and time. Today, online dating has significantly reduced these limitations and improved the opportunity for singles to connect. While online dating has increased the number of accessible singles, we believe it has exacerbated the search problem of finding mutual attraction, which can be complex and time-consuming. According to the U.S. Census Bureau, there were over 100 million unmarried adults in the United States in 2012, and we estimate there to be over one billion unmarried adults worldwide. Our Behavioral Matchmaking engine is self-learning and dynamically adapts based on member actions on our platform, such as sending a message, accepting a connection or expressing interest through certain premium features. Our technology processes these actions to present potential connections that are predicted to result in mutual attraction. As we collect more data, our algorithms are continuously refined to enhance the effectiveness of our solution for all our members. Our solution is easy to use and fun for our members. Once a member enters his or her email address and basic information, he or she can discover and connect with other members right away. Our Behavioral Matchmaking engine then starts to capture data, learn preferences and personalize the experience for that member. We offer our members multiple, distinct discovery tools such as Carousel, Search and SmartPick all powered by our Behavioral Matchmaking engine. These tools and other features, such as Boost and chat, provide our members multiple ways to interact with each other. We believe our solution is well suited for mobile devices. Our intuitive mobile interface and one-touch features allow our members to engage with our platform throughout their day. The availability of our platform across mobile phones, tablets and personal computers enables our members to seamlessly move * For a definition of members and subscribers, see Management s Discussion and Analysis of Financial Condition and Results of Operations Key Metrics. Table of Contents The information in this prospectus is not complete and may be changed. We and the selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus dated May 1, 2014 PROSPECTUS Shares Common Stock This is Zoosk, Inc. s initial public offering. We are selling shares of our common stock and the selling stockholders are selling shares of our common stock. We will not receive any proceeds from the sale of shares of common stock by the selling stockholders. We expect the public offering price to be between $ and $ per share. Currently, no public market exists for the shares. We have applied to list our shares on the NASDAQ Global Market under the symbol ZSK. We are an emerging growth company as defined under federal securities laws and, as such, will be subject to reduced public company reporting requirements. Investing in our common stock involves risks that are described in the Risk Factors section beginning on page 10 of this prospectus. Per Share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to us $ $ Proceeds, before expenses, to the selling stockholders $ $ (1) We have agreed to reimburse the underwriters for certain expenses. See Underwriting. The underwriters may also exercise their option to purchase up to an additional shares from us at the public offering price, less the underwriting discount, for 30 days after the date of this prospectus. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The shares will be ready for delivery on or about , 2014. BofA Merrill Lynch Citigroup RBC Capital Markets Oppenheimer & Co. William Blair The date of this prospectus is , 2014 Table of Contents between devices, increasing the opportunities for member engagement and real-time interactions. During 2013 and in the three months ended March 31, 2013 and 2014, members using mobile devices had an average of 32%, 43% and 59%, respectively, more sessions per day than members using personal computers. We were the #1 grossing dating app and a top 25 grossing app on the iPhone in the United States on March 31, 2014 and our Android app has been downloaded over ten million times. We generate revenues from subscriptions as well as virtual currency. Our member base has experienced rapid growth and we intend to continue to scale our investments in marketing and focus our efforts on the acquisition of new members and subscribers. Our number of members grew from over 19 million as of March 31, 2013 to over 27 million as of March 31, 2014. During the same period, our number of subscribers grew from approximately 509,000 to approximately 721,000. Our total revenues grew by 63% from $109.1 million to $178.2 million in 2012 and 2013, respectively, and by 21% from $41.4 million to $50.1 million in the three months ended March 31, 2013 and 2014, respectively. We had net losses of $20.7 million and $2.6 million in 2012 and 2013, respectively, and $1.6 million and $6.7 million in the three months ended March 31, 2013 and 2014, respectively. Industry Overview Dating is typically episodic. A person may be single or in a relationship multiple times and for varying periods of time. Traditionally, the ability for singles to meet was limited by social circles, geography and time. Today, technology, mobile devices and the Internet have significantly reduced these limitations and improved the opportunity for singles to connect. At the same time, social acceptance of online dating has increased, resulting in more singles embracing online dating as a fun and effective way to meet other singles. While online dating has increased the number of accessible singles, it has created a search problem that requires users to look through a large pool of potential candidates in hopes of finding mutual attraction. Some dating websites have tried to solve this search problem through user-generated search constraints to narrow the number of potential matches. Other dating websites have applied psychology-based methods to attempt to eliminate the need for search altogether by recommending potential matches based on lengthy compatibility-based questionnaires. These websites rely on time-consuming processes and potentially inaccurate self-assessments, producing static, predefined results. Others attempt to solve the search problem by limiting their members to particular religions, ages, careers, education levels or even food preferences. Numerous online dating websites and apps have been created, resulting in a highly fragmented marketplace. However, few reach a critical mass of members. According to IBISWorld, in 2013, there were approximately 3,900 dating services companies, the majority of which had less than 1% market share of the U.S. dating services market. Of these companies, IBISWorld notes only six online dating services companies, including Zoosk, with 1% or greater estimated market share, with only two companies having estimated market share of greater than 10%. The U.S. online dating market is estimated to be $1.4 billion, according to IBISWorld. The global online dating market is significantly larger as this estimate does not take into account international markets. Also, we believe the proliferation of mobile devices in both U.S. and international markets will further drive the scale and growth of online dating. Our Opportunity We believe that there is a significant opportunity to help singles date smarter by leveraging behavioral data. Technology platforms such as Amazon, Netflix and Pandora have successfully used data generated by the actions of their customers to enhance their services and offer recommendations predicted to appeal to each individual customer. Table of Contents Table of Contents We have applied this behavior-based approach to online dating. By leveraging behavioral data, we are able to address the complex and time-consuming search problem created by the increased number of accessible singles made possible by online dating. Our data-driven approach provides predictions of mutual attraction to help members discover and connect with other members. Our Solution We provide our members with highly personalized online dating experiences through easy-to-use features and adaptive technology. We believe our platform provides the following benefits to our members: Personalized. We create a personalized experience for each and every member. While other online dating websites often bucket their users into predefined, static groups, our Behavioral Matchmaking engine dynamically processes, learns and adapts to each member s unique actions on our platform. Easy. We make it easy for our members to get started quickly and focus on engaging with other members. After providing an email address and basic information, members can discover and connect with other members right away. Mobile. The availability of our platform across mobile phones, tablets and personal computers enables our members to seamlessly move between devices, increasing the opportunities for member engagement and real-time interactions. Flexible. Our platform can be used by members throughout their dating lives. We have members who range from 18 to over 90 years old. We seek to form long-term relationships with our members so they return to our platform each time they are looking for a new dating relationship. Global. Our global platform serves members across 80 countries in 25 languages and accepts payments in 55 currencies. In 2013 and in the three months ended March 31, 2014, 49% and 47% of our total revenues, respectively, were international, and 62% and 61% of our members were international at the end of the year and as of March 31, 2014, respectively. Authentic. We believe that the authenticity and quality of member profiles is important in creating an engaging and meaningful online dating experience for our members. Our member operations team is dedicated to managing the quality of member profiles by reviewing profile content for compliance with our terms and policies. Our Competitive Strengths Product focus. We aim to provide the most useful and powerful matching technology. Although our matching technology is complex, our interface provides a simple and intuitive way for members to find potential connections. Proprietary technology. We typically process and analyze over 45 million member actions per day through our Behavioral Matchmaking engine to dynamically address each member s preferences at scale. Efficient global platform. We have a single platform that allows our members to access our product through their mobile phones, tablets and personal computers across 80 countries and in 25 languages. Table of Contents Table of Contents Optimized for mobile. Our product is designed to be easy to use on small screens and enables members to sign up, engage and pay with their mobile devices. During 2013 and in the three months ended March 31, 2014, 41% and 51% of our first-time subscriptions, respectively, were purchased using mobile devices. Large member base. Our platform served over 27 million members globally as of March 31, 2014. Our members have a large pool of singles with whom they can interact and be matched. As we collect more data from these actions, our algorithms are further refined to enhance the effectiveness of our solution for all our members. Data-driven business operations. We perform extensive data analysis to make decisions and improve operations across multiple functions of our company, including marketing, product development, member operations, finance and human resources. Our Strategy We intend to continue to strengthen our position as a leading global online dating platform. We have over 27 million members and intend to grow our member base with the following key strategies: Product innovation. We seek to continuously improve our products through enhancements to our Behavioral Matchmaking engine, user interface and features. Mobile leadership. We intend to continue to develop and introduce mobile-optimized features that allow members to quickly view potential connections and express interest through a single touch. Return-focused advertising. We seek to optimize for total return on advertising spend by frequently analyzing and adjusting this spend to focus on channels and markets that generate a high return. Brand building. We plan to further increase our brand awareness and build trust with our members through increased public relations, social media and advertising. Long-term member engagement. We will continue to make it easy for our members to return and receive an optimal experience each time they are looking for a new dating relationship.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001439813_stevia_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001439813_stevia_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..10eb6695d63c5c0bb90c70de1fc7294af872b393
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@@ -0,0 +1,697 @@
+PROSPECTUS SUMMARY
+
+ 
+
+You should read the following summary
+together with the more detailed information and the financial statements appearing elsewhere in this Prospectus. This Prospectus
+contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those
+anticipated in these forward-looking statements as a result of certain factors, including those set forth under "Risk Factors"
+and elsewhere in this Prospectus. Unless the context indicates or suggests otherwise, references to "we,"
+"our," "us," the "Company," "Stevia" or the "Registrant" refer to Stevia
+Corp., a Nevada corporation and its subsidiaries.
+
+ 
+
+Overview
+
+ 
+
+Stevia Corp. was incorporated on May 21,
+2007 in the State of Nevada. On June 23, 2011, we closed a voluntary share exchange transaction with Stevia Ventures International
+Ltd., a business company incorporated in the British Virgin Islands, pursuant to which we acquired the rights to purchase certain
+strains of stevia leaf growing in Vietnam, including certain assignable exclusive purchase contracts and an assignable supply agreement
+related to the stevia leaf.
+
+ 
+
+We are a farm management company primarily
+focused on crop agronomics from plant breeding to good agricultural practices to development of crop derived products, which can
+be used for human consumption as well as for aquaculture and agriculture applications.
+
+ 
+
+We have established a field test research
+center in Vietnam on 10 Ha (25 acres) of leased land which is designed to support our commercial field trials that are on-going
+in Vietnam and began our first commercial trial harvests in March 2012. We confirmed elite plant varieties, developed propagation
+techniques, conducted field trials across several provinces, documented local operating procedures and post-harvest techniques,
+and began commercial harvests in February 2013.
+
+ 
+
+In July 2012 we formed a joint venture
+with Tech-New Bio-Technology, a technology company in Hong Kong and acquired intellectual property covering several formulations
+utilizing stevia extracts together with probiotics and enzymes which have applications for agriculture, aquaculture and post harvest
+processing. We do not operate an extraction facility, but Tech-New Bio-Technology s affiliate company in China has technologies
+and the facility for the extraction and refinement of high purity stevia; we entered into a multi-year supply contract in March
+2012 where they are committed to purchase all of our stevia leaf production for the first two years and we also have the ability
+to use the resulting stevia extract to formulate our products. While we believe that our joint venture with Tech-New Bio-Technology
+will increase the visibility of our intended services and products, there is no guarantee that such visibility will occur.
+
+ 
+
+Our formulated products consist of ecological
+fertilizers that address soil acidification, compaction and fertility decline caused by chemical fertilizer overuse; foliar fertilizers
+that help plants resist infection and disease; feed formulations for livestock, fish and shrimp that enhance digestion and help
+strengthen immunity; microbiological preparations that address pollution in marine environments that negatively impact aquaculture
+activities; and natural preparations which aid in the preservation of crops after harvest and during processing. We also provide
+private label pure stevia extracts which are suitable for food and beverage applications.
+
+ 
+
+In August of 2012 we began to use our formulated
+products as feed and fertilizer inputs under our farm management model and currently service several commercial operations providing
+feed supplements for shrimp and fish production and fertilizer inputs for farmland as well as using it on our own trial farms.
+
+ 
+
+In September 2012 we began providing samples
+of stevia extract to food and beverage companies and we are working closely with local parties in several South East Asian countries
+to provide technical information in support of recipe development. Although we believe that this product line will have growth
+potential, there is no guarantee that a high volume of stevia will be utilized by our customers. We expect companies will take
+another year to plan product launches.
+
+ 
+
+In January 2014 we entered into a Farm
+Management and Technology Agreement with ebbu LLC to provide farm management consultancy and technical expertise related to growing
+the cannabis plant and extracting its cannabinoids. The cannabis plant produces many chemical compounds called cannabinoids and
+there are more than 85 different cannabinioids that have been identified and isolated from the cannabis plant that exhibit varied
+effects and many of these are being studied for their psychoactive and medical properties. Cannabis plants that have been bred
+to produce high levels of tetrahydrocannabinol ("THC"), a psychoactive constituent, are commonly referred to as marijuana.
+Current federal and most state regulations prevent us from participating directly in the marijuana industry and we cannot guarantee
+that our services or technology will provide value if the laws do not evolve in favor of marijuana production and the commercial
+sale of marijuana derived products.
+
+ 
+
+In February 2014 we registered a wholly
+owned subsidiary, Real Hemp LLC, as part of our strategy to enter the US hemp industry to import, manufacture and license products
+containing hemp seeds, oil, protein, milk, fiber and cannabidiol. Hemp is the common term for cannabis plants that produce very
+low levels of THC and are grown for industrial purposes and foodstuff products. Cannabidiol ("CBD") is one of the active
+cannabinoids in the cannabis plant and is a major constituent of hemp, accounting for up to 40% of the plants extract, and is considered
+to have a wider scope of medical applications than THC. Hemp products, including CBD extracts, can be legally imported and traded
+in the United States. We are currently exploring product opportunities and expect to launch our first products during 2014. There
+is no guarantee that we will launch products containing hemp or that such products will be successful.
+
+ 
+
+ 1
+
+ 
+
+ 
+
+ 
+
+All of our formulated products used for
+agriculture and aquaculture are approved for use in our areas of operation and the largest obstacle we will face will be farmer
+confidence to use new products. We believe that we can overcome this obstacle by building a successful and demonstrable track record
+working with the current operations of Tech-New Bio-Technology and its affiliates. All of the ingredients in the products are natural
+compounds and are approved by the major developed countries if we choose to expand to other markets in the future. A list of the
+major developed countries that have approved the use of stevia as a food additive can be found on page 29.
+
+ 
+
+The stevia industry is segmented into several
+business processes, which can broadly be categorized as i) plant breeding and propagation, ii) farming, iii) extraction and refining,
+iv) product formulation, v) distribution and retail. As we achieve vertical integration along the supply chain we will continue
+to focus on acquisitions and intellectual property development to support further downstream integration into the agriculture and
+aquaculture sectors. We believe that over the long-run this will position the Company to become an industry leader, producing a
+number of value-added stevia-enhanced products.
+
+ 
+
+Our Business
+
+ 
+
+We are a farm management company primarily
+focused on stevia agronomics from plant breeding to good agricultural practices to development of stevia derived products which
+can be used for human consumption as well as for aquaculture and agriculture applications. We plan to invest in research and development
+and intellectual property acquisition and provide farm management services to contract growers and other industry growers integrating
+our stevia focused research and development and intellectual property acquisitions.
+
+ 
+
+Our farm management services include training
+the farmers on the correct protocols and methodologies and providing ongoing technical assistance during the crop cycle as well
+as providing inputs such as the seedlings, fertilizers and additives they are required to use.
+
+ 
+
+We employ our services under three business
+models which we classify as 1) contract farming model, 2) revenue share model and 3) product supply model.
+
+ 
+
+Under the contract farming and revenue
+share models we do not charge for the services and inputs, but rather our services provide us with a competitive advantage to secure
+growers who are willing to dedicate their land and resources to grow crops with an expectation of high yielding, high quality crops
+and guaranteed purchase prices. Under these models we will generate our revenue from the crops that are grown and we only enter
+into production agreements with growers when there is already a committed buyer for the end crop. Under the contract farming model
+we will purchase the crop from the grower at a fixed price and sell to our own customer. Under the revenue share model,
+the grower already has their own buyer and we will share the revenue.
+
+ 
+
+Under the product supply model we will
+market our products in combination with technical services to buyers and charge a fee. We believe that this model will contribute
+a small part of our overall revenue initially until we establish a proven track record and solid reputation for our services and
+products under the first two models. We do not expect to focus on providing strictly farm management or technical services
+for a fee and it is difficult to estimate what we would charge for such services.
+
+ 
+
+We continue to focus on research and
+development to further evolve and develop new protocols, methodologies and intellectual properties and believe that this will be
+key to maintain our competitive advantage.
+
+ 
+
+We utilize the contract farming model
+to produce stevia leaf for our trial harvests and use the stevia extracts to produce our proprietary formulated products, which
+we are applying under the revenue share model to an aquaculture operation beginning August 2012 and a chili operation beginning
+October 2012.
+
+ 
+
+Our mission is to maximize stockholder
+value by consistently developing and acquiring the latest intellectual property and expanding our suite of formulated products
+and their applications and leveraging our farm management business model to maximize market penetration and revenue margins.
+
+ 
+
+To achieve these goals we intend to develop
+a suite of intellectual property relating to stevia and its extracts that will enhance the value of our farm management operations.
+Through our relationships with Tech-New Bio-Technology, Growers Synergy and local institutes, we are exploring the market for commercial
+applications of stevia which will be vertically integrated into our services and production. We have engaged Growers Synergy, a
+regional farm management services provider, to provide farm management operations and back-office and regional logistical support
+for our Vietnam and Indonesia operations for a period of two years. George Blankenbaker, our president, director and stockholder
+is the managing director of Growers Synergy. Growers Fresh Pte Ltd ("Growers Fresh) owns a 51% interest in Growers Synergy
+and Mr. Blankenbaker controls a 49% interest in Growers Fresh.
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+Our current burn rate is approximately
+$150,000 per month and we currently have approximately $350,000 in cash on hand. We are dependent on additional capital to continue
+to operate. Failure to complete a financing will have an adverse effect on our ability to operate and execute our business plan.
+We believe that $3 million of funding is sufficient for us to break-even and achieve self-sufficiency on a cash flow basis. Based
+on the current burn rate, the Company does not currently have sufficient capital to operate and we are doing so on a very limited
+budget, relying primarily on our goodwill with Growers Synergy and our other vendors, and during this period we will need to raise
+additional capital and generate revenue. As a result, our accounts payable are expected to grow. However, there are no assurances
+that Growers Synergy or our other vendors will continue to extend credit to the Company, and if they cease extending credit to
+us, and we are unable to raise capital or generate sufficient revenue, we will have to liquidate or sell certain assets.
+
+ 
+
+Our target markets are initially Vietnam,
+Indonesia and China where we have contracted with growers and have established our own nurseries and test fields. In China we are
+producing our proprietary formulated products and applying them to aquaculture projects under our revenue share model. Although
+our priority is Asia, our services are not limited to specific countries and we plan to pursue viable opportunities in other markets.
+
+ 
+
+Our operations to-date have primarily consisted
+of securing purchase and supply contracts, office space and a research center, developing relationships with potential partners,
+and developing products derived from the stevia plant. We have earned limited revenues since inception. For the nine month period
+ended December 31, 2013 we incurred a net loss of $2,017,484 and for the period from inception (April 11, 2011) to March 31, 2013,
+we have incurred a net loss of $4,359,415. Our assets total $3,641,781 and $2,194,251 as of as of December 31, 2013 and March 31,
+2013, respectively. Further, our auditors have issued a going concern opinion in their audit report dated July 15, 2013. This means
+that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional
+capital.
+
+ 
+
+Recent Developments
+
+ 
+
+The table below sets forth shares of our
+common stock that have been recently issued in exchange for certain services and rights.
+
+ 
+
+ Date
+ 
+ Issuance of Shares for Services and/or Rights
+
+ February 26, 2014
+ 
+ 
+ We issued an aggregate of 28,300,000
+ shares of our common stock to various service providers in exchange for services rendered, including 20,000,000 shares to Blankenbaker
+ Ventures (Asia) Pte. Ltd. on behalf of George Blankenbaker, our president, director and stockholder and 3,000,000 shares to Growers
+ Synergy Pte Ltd., a corporation organized under the laws of Singapore ("Growers Synergy"). Thomas Ong, a director of
+ the Company is a director of Growers Synergy and is also a 25% shareholder of Agriventure Pte Ltd., which is a 49% shareholder
+ of Growers Synergy. Growers Fresh Pte Ltd ("Growers Fresh) owns a 51% interest in Growers Synergy and Mr. Blankenbaker controls
+ a 49% interest in Growers Fresh.
+
+ 
+
+ February 26, 2014
+ 
+ We issued 16,744,682 shares of our common stock to Blankenbaker Ventures (Asia) Pte. Ltd. on behalf of George Blankenbaker, our president, director and stockholder, in exchange for the cancellation of approximately $893,579.93 of working capital advances provided by Mr. Blankenbaker and his affiliated companies.
+
+ 
+ 
+ 
+
+ 
+
+Corporate
+Information
+
+ 
+
+Our principal executive offices are located
+at 7117 US 31 S., Indianapolis, IN, 46227. Our telephone number is 888-250-2566. We maintain a corporate website at http://www.steviacorp.us.
+
+ 
+
+Stock Transfer Agent
+
+ 
+
+Our stock transfer agent is Securities
+Transfer Corporation, and is located at 2591 Dallas Parkway, Suite 102, Frisco, Texas 75034. The agent s telephone
+number is 469-633-0101.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+The Offering
+
+ 
+
+ Issuer
+ 
+ Stevia Corp.
+
+ 
+ 
+ 
+
+ Securities Offered for Resale
+ 
+ 47,898,931 shares of Common Stock underling convertible notes and warrants to purchase Common Stock
+
+ 
+ 
+ 
+
+ Common Stock Outstanding Before the Offering
+ 
+ 145,972,713 shares
+
+ 
+ 
+ 
+
+ Common Stock to be Outstanding After the Offering assuming all of the Securities are Resold
+ 
+ 193,871,644 shares
+
+ 
+ 
+ 
+
+ Use of Proceeds
+ 
+ We will not receive any proceeds from the resale of the shares of common stock underlying the Warrants. We may receive proceeds in the event the Warrants are exercised for cash. Such proceeds from the offering will be used for working capital and general corporate purposes. See "Use of Proceeds."
+
+ 
+ 
+ 
+
+ Trading
+ 
+ Our common stock is quoted on the OTCQB under the symbol "STEV."
+
+ 
+ 
+ 
+
+ Risk Factors
+ 
+ You should carefully consider the information set forth in the section entitled "Risk Factors" beginning on page 2 of this prospectus in deciding whether or not to invest in our common stock.
+
+ 
+
+Nomis Bay Note Shares
+
+ 
+
+This offering, with respect to the Nomis Bay Note Shares, relates
+to the resale of shares of common stock of the Company underlying a Senior Convertible Note, issued March 3, 2014 (the "Nomis
+Bay Note"). On March 3, 2014, pursuant to a Securities Purchase Agreement (the "Purchase Agreement") with Nomis
+Bay Ltd., a Bermuda company ("Nomis Bay"), we issued the Nomis Bay Note with an initial principal amount of $500,000
+for a purchase price of $340,000. The Nomis Bay Note matures on December 27, 2014 (subject to extension as provided
+in the Nomis Bay Note) and, in addition to the 32% original issue discount, accrues interest at the rate of 8% per annum. The Purchase
+Agreement also provides that, upon the terms and subject to the conditions set forth therein, the Company may require Nomis Bay
+to purchase from the Company on or prior to the 10th trading day after the effective date of the registration statement
+registering the shares issuable upon conversion of the Initial Convertible Note, an additional senior convertible note with an
+initial principal amount of $600,000 (the "Additional Convertible Note" and together with the Nomis Bay Note, the "Convertible
+Notes") for a purchase price of $600,000. If issued, the Additional Convertible Note will mature on the date that is the
+10-month anniversary of the date of issuance of the Additional Convertible Note (subject to extension as provided in the Initial
+Convertible Note) and will accrue interest at the rate of 8% per annum. The Nomis Bay Note is convertible at any time, in whole
+or in part, at Nomis Bay s option into shares of the Company s common stock, par value $0.001 per share (the "Common
+Stock"), at a conversion price equal to the lesser of (i) the product of (x) the arithmetic average of the lowest three (3)
+volume weighted average prices of the Common Stock during the 10 consecutive trading days ending and including the trading day
+immediately preceding the applicable conversion date and (y) 40% (the "Variable Conversion Price"), and (ii) $0.30
+(as adjusted for stock splits, stock dividends, stock combinations or other similar transactions). If issued, the Additional Convertible
+Note will be convertible at any time, in whole or in part, at Nomis Bay s option into shares of Common Stock at a conversion
+price that will be equal to the lesser of (i) the Variable Conversion Price and (ii) $0.30 (as adjusted for stock splits, stock
+dividends, stock combinations or other similar transactions). At no time will Nomis Bay be entitled to convert any portion of the
+Convertible Notes to the extent that after such conversion, Nomis Bay (together with its affiliates) would beneficially own more
+than 4.99% of the outstanding shares of Common Stock as of such date. The shares of common stock underlying the Nomis Bay Note
+were issued in reliance upon an exemption from the registration requirements of the Securities Act and/or Rule 506 of Regulation
+D promulgated thereunder.
+
+ 
+
+Anson Reset Shares
+
+ 
+
+This offering, with respect to the Anson
+Reset Shares, relates to the resale of shares of common stock of the Company underlying three warrants in the amounts of 1,877,333,
+1,066,666 and 2,346,666, with exercise prices of $0.20, $0.25 and $0.25 per share (the "Anson Warrants"). Pursuant
+to the terms of a warrant exercise reset offer letter between the Company and the investor, the Anson Warrants were issued in consideration
+for the investor s agreement to immediately cash exercise an existing warrant to purchase 853,333 shares of common stock
+of the Company at an exercise price of $0.20 per share for aggregate consideration to the Company of $170,666 originally issued
+pursuant to the terms of the Securities Purchase Agreement, dated August 1, 2012 (the "Purchase Agreement"). Each Anson
+Warrant has a five year term and was issued on May 3, 2013. Each Anson Warrant provides for adjustment of the exercise price and
+share amount in the event of certain dilutive issuances by the Company. On February 20, 2014, the Company issued a notice to the
+holder that the aggregate number of Anson Warrants had been adjusted to 23,026,318 and the exercise price of each had been adjusted
+to $0.053365 as a result of certain other offerings of the Company. 5,290,665 of the shares underlying the Anson Warrants were
+previously registered by the Company pursuant to the Registration Statement on Form S-1/A filed December 30, 2013. The warrants
+and the shares of common stock underlying the warrants were issued in reliance upon an exemption from the registration requirements
+of the Securities Act and/or Rule 506 of Regulation D promulgated thereunder.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+Cranshire Warrant Shares
+
+ 
+
+This offering, with respect to the Cranshire
+Warrant Shares, relates to the resale of the shares of common stock underlying a warrant in the amount of 2,560,486 with an exercise
+price of $0.053365. The warrant has a five (5) year term and was issued pursuant to the terms of the Purchase Agreement. The warrant
+was originally issued in the amount of 213,334 shares at an exercise price of $0.6405. Pursuant to the anti-dilution adjustment
+provision contained therein, on February 20, 2014, the Company issued a notice to the holder that the total share amount had been
+increased to 2,560,486 and the exercise price had been reduced to $0.053365 as a result of certain other offerings of the Company.
+683,202 of the shares underlying the Cranshire Warrants were previously registered by the Company pursuant to the Registration
+Statement on Form S-1/A filed December 30, 2013. Additionally, on February 20, 2014 in consideration for the investor s agreement
+to immediately cash exercise a portion of the Cranshire Warrants for aggregate consideration to the Company of $36,459, the Company
+agreed to issue the investor an additional warrant to purchase 683,202 shares of common stock. The warrants and the shares of common
+stock underlying the warrants were issued in reliance upon an exemption from the registration requirements of the Securities Act
+and/or Rule 506 of Regulation D promulgated thereunder. 
+
+ 
+
+JMJ Note Shares
+
+ 
+
+This offering, with respect to the JMJ Note Shares, relates
+to the resale of 3,000,000 shares of common stock of the Company underlying a $400,000 Promissory Note issued July 10, 2013 (the
+"JMJ Note"). The JMJ Note is subject to a one-time interest charge equal to 12% of the principal sum and is due and
+payable July 10, 2014. The JMJ Note provides that it may be converted into common stock of the Company at any time at the election
+of the holder, at a conversion price equal to the lesser of $0.26 or 65% of the lowest trade price in the 25 trading days previous
+to the conversion. The JMJ Note and the shares of common stock underlying the JMJ Note were issued in reliance upon an exemption
+from the registration requirements of the Securities Act and/or Rule 506 of Regulation D promulgated thereunder.
+
+ 
+
+SUMMARY OF FINANCIAL INFORMATION
+
+ 
+
+The following selected financial information
+is derived from the Company s Financial Statements appearing elsewhere in this Prospectus and should be read in conjunction
+with the Company s Financial Statements, including the notes thereto, appearing elsewhere in this Prospectus.
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+Summary of Statements of Operations
+
+ 
+
+For the Three Months Ended December 31, 2013: 
+
+ 
+
+ Total revenue 
+ $388,746 
+
+ 
+ 
+
+ Net income 
+ (831,410)
+
+ 
+ 
+
+ Net income per common share (basic and diluted) 
+ $(0.01)
+
+ 
+ 
+
+ Weighted average common shares 
+ 79,632,959 
+
+ 
+
+For the Nine Months Ended December 31, 2013: 
+
+ 
+
+ Total revenue 
+ $1,893,865 
+
+ 
+ 
+
+ Net loss 
+ (2,017,484)
+
+ 
+ 
+
+ Net loss per common share (basic and diluted) 
+ $(0.03)
+
+ 
+ 
+
+ Weighted average common shares 
+ 72,842,975 
+
+ 
+
+For the Fiscal Year Ended March 31, 2013: 
+
+ 
+
+ Total revenue 
+ $2,168,093 
+
+ 
+ 
+
+ Net loss 
+ (2,035,864)
+
+ 
+ 
+
+ Net loss per common share (basic and diluted) 
+ $(0.03)
+
+ 
+ 
+
+ Weighted average common shares 
+ 62,092,487 
+
+ 
+
+Statement of Financial Position
+
+ 
+
+ 
+ December 31, 2013 
+
+ 
+ 
+
+ Cash 
+ $85,366 
+
+ 
+ 
+
+ Accounts receivable 
+ $164,988 
+
+ 
+ 
+
+ Seeds 
+ $1,807,000 
+
+ 
+ 
+
+ Prepayments and other current assets 
+ $74,946 
+
+ 
+ 
+
+ Total current assets 
+ $2,132,300 
+
+ 
+ 
+
+ Total assets 
+ $3,641,781 
+
+ 
+ 
+
+ Total current liabilities 
+ $2,591,869 
+
+ 
+ 
+
+ Stockholders equity 
+ $798,339 
+
+ 
+ 
+
+ Non-controlling interest 
+ $(345,946)
+
+ 
+ 
+
+ Equity 
+ $452,393 
+
+ 
+ 
+
+ Total liabilities and equity 
+ $3,641,781 
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+ 
+ March 31,
+ 2013 
+
+ 
+ 
+
+ Cash 
+ $424,475 
+
+ 
+ 
+
+ Accounts Receivable 
+ 158,008 
+
+ 
+ 
+
+ Prepayments and other current assets 
+ 33,096 
+
+ 
+ 
+
+ Total current assets 
+ 615,579 
+
+ 
+ 
+
+ Total assets 
+ $2,194,251 
+
+ 
+ 
+
+ Total current liabilities 
+ $1,457,531 
+
+ 
+ 
+
+ Stockholders equity 
+ $464,765 
+
+ 
+ 
+
+ Non-controlling interest 
+ $(214,158)
+
+ 
+ 
+
+ Equity 
+ $250,607 
+
+ 
+ 
+
+ Total liabilities and equity 
+ $2,194,251
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001442835_kolltan_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001442835_kolltan_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..93694e82823213703b70842e27a6e7e80d7ae836
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001442835_kolltan_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, especially the sections titled "Risk Factors," "Special Note Regarding Forward-Looking Statements and Industry Data" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the related notes appearing at the end of this prospectus, before making an investment decision. Company Overview We are a clinical-stage biopharmaceutical company focused on the discovery and development of novel antibody-based drugs targeting receptor tyrosine kinases, or RTKs, for the treatment of cancer and other diseases with significant unmet need. We are a leader in understanding the mechanism of action and the biomedical roles of RTKs and their signaling pathways. RTKs are a group of cell-surface receptors that play important signaling roles in a variety of key cellular functions. Genetic mutations and abnormal regulation of RTKs play critical roles in many diseases. We are employing a systematic investigation of RTKs and applying our insights with the goal of developing important new medicines with novel mechanisms of action. Our founders and members of our management team have deep expertise and a proven track record in drug discovery, development and commercialization of innovative therapeutics, including drugs targeting kinases. We have also established an extensive network of relationships with leading academic institutions, clinical and scientific advisors and biopharmaceutical companies to augment our internal research and development capabilities. Our lead product candidate, KTN3379, is an antibody targeting the ErbB3 RTK and is currently in Phase 1b clinical development for adult patients with advanced solid tumors. We also have two preclinical programs targeting the KIT RTK for inflammatory diseases and oncology. We have a robust discovery pipeline, including antibody drug conjugates, or ADCs, directed at a range of RTK targets and recently acquired rights to additional technologies to enhance our position in the RTK field. For example, our recent acquisition of Xetrios Therapeutics, Inc., or Xetrios, enables us to deepen our focus on the TAM family of RTKs, which includes TYRO3, AXL and MER, to address immuno-oncology, autoimmune and infectious diseases. We believe our product candidates are distinct from other antibodies targeting RTKs, offer the potential to improve patient outcomes and have an opportunity to be first-in-class or best-in-class. AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents The following table summarizes our product development pipeline: We were founded in 2007 by Dr. Joseph Schlessinger and Arthur Altschul, Jr. We licensed our founding intellectual property from Yale University, or Yale, and commenced operations in 2008. Dr. Schlessinger was a founder of SUGEN, Inc., or SUGEN, and Plexxikon, Inc., or Plexxikon. Mr. Altschul was an executive at and involved in the founding of SUGEN and was a founding investor in Plexxikon. In 1999, SUGEN was acquired by Pharmacia & Upjohn, Inc., now part of Pfizer, Inc., or Pfizer. Three drugs targeting RTKs that were under development by SUGEN at the time it was acquired by Pfizer, Sutent (sunitinib), Palladia (toceranib) and Xalkori (crizotinib), have been approved by the U.S. Food and Drug Administration, or FDA, and are currently on the market for the treatment of cancer. Plexxikon was acquired by Daiichi-Sankyo Company, Limited in 2011, after announcing positive interim Phase 3 clinical trial data for Zelboraf (vemurafenib), a drug targeting the oncogenic, or tumor promoting, BRAF kinase mutant. Zelboraf (vemurafenib) was approved by the FDA under priority review, is currently on the market for the treatment of cancer and was widely viewed as a breakthrough for the treatment of melanoma. Dr. Schlessinger serves as a member of our board of directors and as Chairman of our scientific advisory board, or SAB. He is a recognized leader in the field of RTK biology, having authored or co-authored over 475 scientific articles and papers on pharmacology and cancer biology, many of which relate to tyrosine kinase signaling. He is chair of the Pharmacology Department at Yale University School of Medicine, as well as the founding director of Yale's Cancer Biology Institute. Mr. Altschul serves as Chairman of our board of directors, was involved in the founding of FibroGen, Inc. and serves as a director of General American Investors, Child Mind Institute and The Neurosciences Research Foundation. Our President and Chief Executive Officer is Dr. Gerald McMahon. He also is a member of our board of directors. Dr. McMahon has over 25 years of experience in the pharmaceutical industry, has authored over 85 publications and is a co-inventor on 65 issued U.S. patents. Dr. McMahon served as President of SUGEN, and was instrumental in the discovery and development of Sutent (sunitinib), Palladia (toceranib) and Xalkori (crizotinib). In addition, Dr. McMahon was a key executive at MedImmune, LLC, or MedImmune, a subsidiary of AstraZeneca AB, or AstraZeneca, where he was KOLLTAN PHARMACEUTICALS, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation or organization) 2834 (Primary Standard Industrial Classification Code Number) 26-1476129 (I.R.S. Employer Identification No.) 300 George Street, Suite 530 New Haven, Connecticut 06511 (203) 773-3000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents involved in the creation of a portfolio of oncology biologics. While at MedImmune, Dr. McMahon was actively involved in the development of KTN3379, which we have licensed from MedImmune. We have established a broad relationship with Yale. We are a party to both a license agreement and a sponsored research agreement with Yale that we believe align our financial and scientific interests with Yale's in the RTK field. Our SAB is comprised of a team of experts with strong scientific and clinical experience who contribute to our understanding of RTK targets and product candidates directed toward these targets. Further, we have selectively executed agreements with biopharmaceutical companies to acquire rights to complementary technologies and product candidates. We believe our relationships with Yale, other academic institutions, our SAB and selected biopharmaceutical companies allow us to expand our product candidate pipeline and leverage the insights of leading scientists, researchers and clinicians. Our Focus on Therapeutic Antibodies Targeting RTKs Kinases are a broad class of 518 distinct enzymes. Kinases play essential roles in cell signaling and regulation of important cellular processes, such as cell proliferation, differentiation and survival as well as cell metabolism and other activities. Many kinases are targets of approved drugs, including antibody-based drugs, or biologics, as well as small molecule, or conventional chemical based drugs. RTKs comprise approximately 10% of all kinases. As shown in the chart in "Business Background on Kinases and RTKs," total worldwide net sales of small molecule drugs that target RTKs were approximately $12.6 billion in 2013. Two of these small molecule drugs are Gleevec (imatinib) and Tarceva (erlotinib). As shown in the chart in "Business Background on Kinases and RTKs," total worldwide net sales of biologics that target RTKs or their ligands were approximately $22.5 billion in 2013, despite targeting only three of the 58 known RTKs. Three of these biologics are the well-known cancer drugs Herceptin (traztuzumab), Avastin (bevacizumab) and Erbitux (cetuximab). We believe that the remaining 55 RTK targets, for which there are no approved biologics, provide an opportunity to create a broad portfolio of therapeutic biologics. Small molecules and biologics represent two different approaches to RTK drug discovery and development. While small molecules are well suited for targeting genetic alterations, such as mutations which are generally associated with defined patient populations, we believe there are several advantages to targeting RTKs through a biologic-based approach, including: antibodies are better suited to more potently inhibit the activation and action of cancers and other diseases driven by wild type, or normal, RTKs; antibodies can block distinct critical steps essential for RTK activation; antibodies selectively target RTKs and, therefore, have fewer and more predictable side effects, making them easier to combine with standard of care therapies; inhibitory antibodies block RTK activity by binding to large surfaces, therefore reducing the probability of resistance caused by new mutations; antibodies are injectable drugs that do not go through the gut and are not processed by the liver, resulting in fewer complications related to bioavailability and metabolism; and antibodies circulate in the bloodstream after injection, often for weeks, resulting in prolonged drug exposure that permits less frequent dosing. Gerald McMahon, Ph.D. President and Chief Executive Officer Kolltan Pharmaceuticals, Inc. 300 George Street, Suite 530 New Haven, Connecticut 06511 (203) 773-3000 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents Our Lead Programs KTN3379 ErbB3 RTK Inhibitor Our lead product candidate, KTN3379, is an antibody that targets ErbB3, an RTK that belongs to the epidermal growth factor receptor, or EGFR, family. ErbB3 is believed to be an important receptor regulating cancer cell growth and survival. ErbB3 is expressed in many cancers including head and neck, breast, colorectal, lung, gastric, ovarian and melanoma. While there are several successful, currently marketed drugs targeting two members of the EGFR family, there are none that directly target ErbB3. KTN3379 has been demonstrated to be differentiated from other ErbB3 antibodies in development based on preclinical observations supporting its potency and pharmacology and on its novel binding to ErbB3 and mechanism of inhibition of ErbB3. We and Dr. Schlessinger recently elucidated the x-ray crystal structure of KTN3379 bound with the extracellular domain of ErbB3. We believe that the unique binding site, or epitope, of KTN3379 with ErbB3 prevents activation that is dependent on ErbB3's ligand, known as neuregulin, as well as ligand independent binding. Ligands are substances that bind RTKs and activate signaling within the cell. We believe that the novel binding of this antibody with ErbB3 and its dual mechanism of action suggest that KTN3379 has the potential to completely inactivate ErbB3 and potentially is applicable as a therapy for all tumor types in which ErbB3 plays a role. We believe that the best approach for targeting ErbB3 is an antibody in combination with other therapeutic agents, such as an EGFR or ErbB2 inhibitor, because ErbB3 signaling requires the presence of either EGFR or ErbB2 to initiate signaling through dimerization. Dimerization is the process by which two single RTK proteins physically interact, ultimately resulting in their activation and cell signaling. We believe this approach is supported by the recent approval of the combination of Perjeta (pertuzumab), which blocks ErbB2 dimerization with ErbB3, with Herceptin (trastuzumab), which inhibits ErbB2 signaling, for the treatment of metastatic breast cancer. We are conducting an open-label Phase 1 clinical trial program of KTN3379. In September 2014, we completed the dose escalation monotherapy portion of this clinical trial program in adult patients with advanced solid tumors. In October 2014, we initiated the Phase 1b portion of this clinical trial program in which we are evaluating KTN3379 in combination with selected currently approved cancer drugs in a variety of types of solid tumors. We plan to enroll approximately six to 12 patients in each of the four concurrent arms in the Phase 1b portion of this clinical trial program. The first arm will test KTN3379 in combination with Erbitux (cetuximab) in head and neck or colorectal cancer patients, the second arm will test KTN3379 in combination with Tarceva (erlotinib) in non-small cell lung cancer patients, the third arm will test KTN3379 in combination with Zelboraf (vemurafenib) in melanoma patients and the fourth arm will test KTN3379 in combination with Herceptin (trastuzumab) in breast or gastric cancer patients. We expect to announce preliminary data from the Phase 1b portion of our Phase 1 clinical trial program in the first half of 2015. In the completed dose escalation monotherapy portion of our Phase 1 clinical trial program, KTN3379 administered at doses of 5 mg/kg, 10 mg/kg and 20 mg/kg every 21 days was well tolerated in the advanced cancer patients in the trial. No dose limiting toxicities were observed and a maximum tolerated dose was not determined. In this dose escalation portion, we also observed a linear and dose proportional pharmacokinetic profile based on the concentration of the drug in the patients' blood. Levels of KTN3379 in patients' blood at doses of 10 mg/kg and 20 mg/kg exceeded the target exposure determined from experiments assessing antitumor activity in preclinical models. All doses tested resulted in modulation of soluble ErbB3, a biomarker circulating in the patients' blood. We plan to enroll a total of at least 40 patients in our overall Phase 1 clinical trial program. The primary objectives of our Phase 1 clinical trial program are to determine the maximum tolerated dose, establish a dosing regimen for Phase 2 clinical trials and evaluate the general safety profile of KTN3379. The secondary objectives of our Phase 1 clinical trial program are to determine the Copies to: David E. Redlick Brian A. Johnson Wilmer Cutler Pickering Hale and Dorr LLP 7 World Trade Center 250 Greenwich Street New York, New York 10007 Telephone: (212) 230-8800 Fax: (212) 230-8888 William Hicks Sahir Surmeli Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, PC 666 3rd Avenue New York, New York 10017 Telephone: (212) 935-3000 Fax: (212) 983-3115 Table of Contents pharmacokinetics, to evaluate the immunogenicity and to evaluate preliminary anti-tumor activity of KTN3379. Based on the results from the dose escalation portion of our Phase 1 clinical trial program, we were able to identify a recommended dose for Phase 2 clinical trials. We plan to initiate two additional clinical trials of KTN3379 in the first half of 2015. The first, commonly referred to as a window study, will evaluate KTN3379 as a single agent in head and neck cancer patients. The second is another Phase 1b clinical trial that will evaluate KTN3379 in combination with Zelboraf (vemurafenib) in thyroid cancer patients. Subject to the satisfactory completion of our overall Phase 1 clinical trial program, we plan to initiate Phase 2 clinical trials in the first half of 2016. In the Phase 2 clinical trials, we plan to test KTN3379 in combination with other cancer drugs in certain indications based on the results from the ongoing Phase 1b portion of our Phase 1 clinical trial program. KTN0158 KIT RTK Inhibitor Our second product candidate, KTN0158, is an antibody targeting KIT, an RTK that plays a role in modulating the activity of a variety of cell signaling pathways, including those associated with mast cells. Mast cells are a part of the immune system and are implicated in several disease categories including inflammatory diseases, oncology, idiopathic pulmonary fibrosis, atopic dermatitis and infection. We applied novel insights about the x-ray crystal structure of KIT that were elucidated in Dr. Schlessinger's laboratory to identify a unique way to inhibit the function of KIT, which led to our discovery of KTN0158. In preclinical studies, we determined that KTN0158 can modulate the activity of mast cells, suggesting that this agent could represent a novel approach to the treatment of inflammatory diseases in both chronic and acute settings. We are evaluating KTN0158 as a potential therapeutic for a range of disease indications, beginning with neurofibromatosis type 1, or NF1. NF1 is a subtype of neurofibromatosis, which is a rare genetic disorder leading to activation of mast cells resulting in benign growths, known as neurofibromas. Neurofibromas can cause pain, itching and obstruction of organ function, as well as cosmetic effects. The disease usually manifests in childhood and in its more severe forms leads to substantial disfiguration and morbidities, including enlarged heads, scoliosis, congenital defects of bones, optic gliomas, learning disabilities and high blood pressure. According to the National Institutes of Health, approximately 100,000 individuals in the United States suffer from NF1 and one in 3,500 individuals born in the United States each year carries the genetic defect causing NF1. We believe that KTN0158 as a treatment for NF1 will qualify for orphan drug designation in both the United States and the European Union. A product candidate may be eligible for orphan drug designation prior to submitting a new drug application, or NDA, or a biologics license application, or BLA, if the product candidate is intended to treat a rare disease or condition, generally defined as a condition affecting less than 200,000 individuals in the United States. If a product candidate with orphan drug designation receives the first FDA approval for the rare disease or condition for which it has been designated, the FDA may not approve any other applications for the same product for the same indication for seven years, except in certain limited circumstances. See "Business Government Regulation Orphan Designation and Exclusivity" for additional information. There are no currently approved drugs indicated for patients afflicted with NF1, which may allow us to qualify for favorable regulatory strategies, such as breakthrough therapy or fast track designation. The FDA may designate a product candidate as a breakthrough therapy if it is intended, either alone or in combination with one or more other drugs, to treat a serious or life-threatening condition and preliminary clinical evidence demonstrates the product may provide a substantial improvement over available therapies on at least one clinically significant endpoint. If a product candidate receives this designation, the FDA may take certain actions that may expedite review of the product. The FDA may designate a product candidate for fast track review if it is intended, either alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition and the product Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement is declared effective. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents candidate demonstrates the potential to address an unmet medical need for the disease or condition. If a product candidate receives this designation, sponsors may have greater interactions with the FDA, and the FDA may initiate review of sections of a fast track product's NDA before the application is complete. See "Business Government Regulation Fast Track, Breakthrough Therapy and Priority Review Designations" for additional information related to the foregoing eligibility criteria and benefits of each designation. We expect to submit an investigational new drug application, or IND, to the FDA for this product candidate in mid-2015 and, if accepted, initiate a Phase 1 clinical trial in NF1 patients in the second half of 2015. Subject to the satisfactory completion of this Phase 1 clinical trial, we plan to initiate a Phase 2 clinical trial in NF1 patients in the second half of 2016. We are also actively exploring the development of KTN0158 for a variety of inflammatory diseases, including atopic dermatitis and idiopathic pulmonary fibrosis, and plan to submit an IND and initiate clinical trials in an additional indication in the second half of 2016. KIT-ADC Our third development program, which we refer to as KIT-ADC, is focused on using an ADC to target cancers that express the KIT receptor. In addition to KIT's role in mast cells and inflammation, KIT is expressed in many types of human cancers, including small cell lung cancer, the family of tumors in Ewing's sarcoma, melanoma, acute myeloid leukemia and gastro-intestinal stromal tumors. However, in most of these cancers KIT is not oncogenic. Our KIT-ADC is comprised of our antibody, KTN0158, conjugated to a novel cytotoxic, which is a substance that kills tumor cells, from a class called Pyrrolobenzodiazepine, or PBD. In May 2013, we licensed certain PBDs from Spirogen Developments LP and Spirogen SARL (Bermuda Branch), each of which are subsidiaries of AstraZeneca and which we refer to together as Spirogen. In preclinical studies of our KIT-ADC, the KTN0158 antibody portion bound to KIT on tumor cells and was internalized by the cell, resulting in the release of the PBD cytotoxic, which then bound to DNA and killed the tumor cell. We are currently working to optimize the PBD-linker chemistry and conjugation of the PBD cytotoxic to our KTN0158 antibody and have initiated nonclinical toxicology studies. We plan to identify an IND candidate in the first half of 2015, initiate IND enabling preclinical studies in 2015 and submit an IND in late 2016. We plan to use the drug supply, nonclinical toxicology data and expected regulatory filings for our KTN0158 development program to support the KIT-ADC IND submission. TAM Research Program In August 2014, we acquired Xetrios to obtain rights to intellectual property relating to TAM RTKs owned in whole or in part by Xetrios, or licensed by Xetrios from the Salk Institute for Biological Studies, or Salk, in La Jolla, California. The TAM RTK family consists of TYRO3, AXL and MER. The intellectual property licensed from Salk was generated in the laboratory of Dr. Greg Lemke, an international expert in the biology of TAM RTKs. TAM RTKs have been shown to be important drug targets for immuno-oncology, autoimmune and infectious diseases. In addition, new evidence from Dr. Lemke's laboratory suggests that certain TAM RTKs may modify the function of macrophages and dendritic cells, which has further implications for the role of TAM RTKs in immuno-oncology. Additional Research Programs We are building a robust product development pipeline by systematically creating antibodies against RTK targets and pursuing novel biologic mechanisms. In addition to the two RTK targets that are the subject of our lead development programs and our separate TAM research program, we are currently pursuing five other areas of RTK research to identify candidates for clinical development either internally or in collaboration with third parties. Some of these programs may include ADC technology. We believe our understanding of the structure, biology and activity of RTKs and our innovative scientific approach will allow us to develop antibody-based drugs to modulate the function of CALCULATION OF REGISTRATION FEE Title of Each Class of Securities To Be Registered Proposed Maximum Aggregate Offering Price(1) Amount of Registration Fee(2)(3) Common Stock, $0.001 par value per share $86,250,000 $11,109 (1)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended. (2)Calculated pursuant to Rule 457(o) based on an estimate of the proposed maximum aggregate offering price. (3)The registration fee of $11,109 was previously paid in connection with the Registration Statement. Table of Contents RTKs and create novel product candidates that have an opportunity to be first-in-class or best-in-class. In certain cases, we expect our new antibody-based product candidates will incorporate the innovative technologies that we have in-licensed. Our Strategy Our goal is to become a leader in the discovery, development and commercialization of important medicines targeting RTKs for the treatment of patients with cancer and other diseases with significant unmet need. Key elements of our strategy include: Rapidly advance the clinical development of KTN3379 as a combination therapy. Establish clinical proof of concept of KTN0158 in NF1, an underserved orphan indication, in order to accelerate development and regulatory review. Expand our product candidate pipeline by continuing development of our KIT-ADC program, discovering product candidates for our TAM research program, conducting additional proprietary research and applying insights from our network of collaborators. Opportunistically in-license or acquire technologies and product candidates. Establish specialized sales and marketing capabilities in the United States in order to maximize the commercial potential of our product candidates. Collaborate selectively to augment and accelerate development and commercialization of our product candidates. Our Network of Collaborators We augment our internal research and development efforts through our network of academic, scientific and clinical relationships that we have established so as to benefit from the knowledge and experience of other experts in the RTK field and specific disease categories. The primary example of these relationships is our set of arrangements with Yale. We believe our relationships with Yale and other institutions, including the Salk Institute for Biological Studies, the Sarah Cannon Research Institute, Children's Hospital of Philadelphia and Indiana University, allow us to expand our product candidate pipeline and obtain the insights of leading scientists, researchers and clinicians. Our strong presence in the RTK field has enabled us to access additional technologies that we believe will further enhance the quality of our product candidate pipeline and provide flexibility in optimizing our clinical programs. We have selectively executed agreements with biopharmaceutical companies, including MedImmune and Spirogen, that are intended to enhance our product candidate pipeline and proprietary scientific and technological capabilities. Risks Associated with Our Business Our business is subject to a number of risks of which you should be aware before making an investment decision. These risks are
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+PROSPECTUS SUMMARY The following summary highlights material information contained in this prospectus. This summary does not contain all of the information you should consider before investing in the securities. Before making an investment decision, you should read the entire prospectus carefully, including the risk factors section, the financial statements and the notes to the financial statements. You should also review the other available information referred to in the section entitled "Where you can find more information" in this prospectus and any amendment or supplement hereto. Unless otherwise indicated, the terms the "Company," "we," "us," and "our" refer and relate to Lot78, Inc. The Company Overview The Company was incorporated in the State of Nevada on June 27, 2008 under the name "Global Club, Inc." The original business plan of the Company was to develop a wide range of loyalty programs based on a system of "Global Club points" awarded for purchases made in associated establishments. The Company was not successful in implementing its Global Club points business model on a large-scale basis, and pursued alternative business opportunities and potential acquisition partners. On March 14, 2011, the Company filed a Certificate of Amendment with the Secretary of State of Nevada changing the name of the Company to "Bold Energy, Inc." On November 12, 2012, the Company, then under the name Bold Energy, Inc., entered into a Share Exchange Agreement (the "Share Exchange Agreement") with Anio Limited ("Anio Ltd."), a limited liability company established under the laws of the United Kingdom, which conducts its primary line of business under the name Lot78, Inc. ("Lot78"), the shareholders of Anio Ltd. (the "Anio Ltd. Shareholders"), and the controlling stockholders of the Company (the "Bold Controlling Stockholders"). Pursuant to the Share Exchange Agreement, the Company acquired 11,510 (100%) shares of common stock of Anio Ltd. from the Anio Ltd. Shareholders (the " Anio Ltd. Shares") and in exchange issued 31,909,654 pre-split (54.26%) restricted shares of its common stock to the Anio Ltd. Shareholders (the "Bold Shares"). The Share Exchange Agreement contains customary representations, warranties and conditions to closing. The closing of the Share Exchange Agreement (the "Closing") occurred on February 4, 2013 (the "Closing Date"). As a result of the Share Exchange Agreement, Anio Ltd. became a wholly-owned subsidiary of the Company and the Company now carries on the business of Anio Ltd. as its primary business. Effective May 14, 2013, the Company changed its fiscal year end from July 31st to September 30th to align its fiscal year end with that of Anio Ltd. Anio Ltd. subsequently changed its name to Lot78 UK Ltd. on March 28, 2013. The Company designs, markets, distributes, and sells apparel under the brand name "Lot78" to fashion-conscious consumers on four continents, including North America, Europe, Asia, and South America. We seek to be a trend setting leader in the design, marketing, distribution and sale of luxury street apparel. Our current collection is a full men s and women s contemporary ready-to-wear line which includes leather jackets, t-shirts, sweats, knitwear, accessories, jeans, chinos, and wool coats. We operate in three distinct but integrated segments: Wholesale, Consumer Direct and Core Services. Our Wholesale segment sells our products to industry-leading high-end global department stores, specialty retailers and boutiques; our Consumer Direct segment consists of e-commerce sales through our branded website located at www.lot78.com; and our Core Services segment provides product design, distribution, marketing and other overhead resources to the other segments. Since our inception in 2008, we have developed a recognizable brand, expanded our product offerings, and initiated a growth strategy to expand both our Wholesale and Consumer Direct segment sales. A close and influential network of global contract manufacturers have greatly aided the expansion of the Lot78 collection, which started with four men s leather jackets and developed to become a full men s and women s ready-to-wear fashion and apparel line. We utilize contract manufacturers located in Italy for the manufacture of our products. The majority of our production is based in the Venetian region of Italy, whose legacy befits our aesthetic heritage and focus on luxurious quality and innovative style. All garments are sourced, designed and manufactured by people with unique strengths, skills, and craftsmanship to create premium quality and reliable products that are in high demand with our targeted affluent demographics. We seek to continue to build our brand recognition that is characterized by unique style, timelessness, utility, and quality, as opposed to merely following prevailing fads or trends that do not have the same degree of potential growth or longevity over time. We are an "emerging growth company" within the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with the requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. For a description of the qualifications and other requirements applicable to emerging growth companies and certain elections that we have made due to our status as an emerging growth company, see "We are an "Emerging Growth Company" and we cannot be certain if the reduced disclosure requirements applicable to Emerging Growth Companies will make our Common Stock less attractive to Investors" on page 10 of this prospectus. As long as we remain an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012 ("JOBS Act"), we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an "emerging growth company." We will remain an emerging growth company until the earliest of: (A) the last day of the fiscal year following the fifth anniversary of our first sale of common equity securities pursuant to an effective registration statement, (B) the last day of the fiscal year in which we have total annual gross revenue of $1.0 billion or more, (C) the date that we are deemed to be a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (D) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. SUMMARY OF THIS OFFERING The Issuer Lot78, Inc. Securities being offered Up to 6,666,668 shares of Common Stock is being offered for sale by the Company, this represents approximately 2.81% of the currently issued and outstanding shares of the Company's Common Stock. Our Common Stock is described in further detail in the section of this prospectus titled "DESCRIPTION OF SECURITIES." Per Share Price $0.15 Duration of Offering The shares are offered for a period not to exceed 180 days, unless extended by our Board of Directors for an additional 90 days.
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in the common stock. You should carefully read the entire Prospectus, including Risk Factors , Management s Discussion and Analysis of Financial Condition and Results of Operations and the Financial Statements, before making an investment decision. Corporate Background and Our Business The Company was incorporated in the State of Delaware on June 18, 2004 under the name Ultimate Jukebox, Inc. On September 4, 2004, Ultimate Jukebox, Inc. merged with NetMusic Corporation, and subsequently changed the Company name to NetMusic Entertainment Corporation. On March 10, 2006, the Company ceased digital media distribution operations, began operations as a natural resources company, and changed the Company name to Enterayon, Inc. On January 15, 2008, the Company merged with and assumed the name of its wholly-owned subsidiary, North Bay Resources Inc. As a result of the merger, Enterayon, Inc. was effectively dissolved, leaving North Bay Resources Inc. as the remaining company. The Company s business plan is based on the Generative Business Model, which we believe can generate a steady stream of revenue before any property is ever developed into a commercial mining operation. The Generative Business Model comprises the following steps: 1. Targeting and acquiring mining properties with good historical assays. (1) 2. Identifying potential partners for the development of each of the Company s properties and entering into joint-venture or option agreements. In most cases, the partner is another mining company whose shares trade on a public exchange. 3. The initial agreement usually comprises a small non-refundable cash payment in advance and a significant number of shares in the stock of the partner or acquiring company. Cash and shares increase in staged payments on the anniversary date of the agreement. In the case of an option agreement, the Company will retain a net smelter royalty ("NSR") with a buyout provision should the property be the site of a major discovery and/or developed into a commercially-operating mine. In the case of a joint-venture, we retain a percentage of ownership, typically 50%, in the event the partner satisfies all the terms of the contract to completion. (2) 4. The partner or acquiring company also must commit to a specific work program over a period of several years to develop the property, often involving a commitment of several million dollars. 5. We believe these work programs enable us to maintain our properties for little or no cost, as the annual maintenance fees due to the government are offset by the amount of money spent on property exploration and development paid for by our partners. Any surplus of expenditures beyond what is due to maintain the properties can then be applied as portable assessment credits towards the maintenance of other Company properties that are not yet producing revenue but which have good prospects of doing so in the future. (3) 6. If at any time, the partner defaults on the work agreement or does not make staged cash or stock payments by the anniversary date, the property then reverts back to us, which then leaves us free to find another partner and begin the process all over again. (1) The acquisition of a mining property in British Columbia conveys the mineral or placer rights for mining-related purposes only, and while our rights allow us to use the surface of a claim for mining and exploration activities, our claims do not convey any other surface, residential or recreational rights to the Company. Additionally, our right to extraction is not absolute, as any mechanized extraction work on claims in British Columbia requires additional permits and possibly conversion of our claims to mining leases, the approval of which is not guaranteed. As of July 1, 2012 when new regulations became effective in British Columbia, the registration fee to stake a claim in British Columbia is $1.75 per hectare. The initial term of any claim staked is one year. This term may be extended for up to 10 years at a time by filing a statement of work showing minimum expenditures on a mineral claim of $5 per hectare per year for the first 2 years, $10 per hectare per year for the next 2 years, $15 per hectare per year for the following 2 years, and $20 per hectare per year for each year thereafter. For placer claims, the annual work expenditure is $20 per hectare. In the event no work is performed by the anniversary date of each claim, the claims may be extended for up to one year at a time by paying twice the applicable work commitment as a fee to the Province of British Columbia, which is referred to as Cash In Lieu Of Work ( CIL Fee ). These fees are the responsibility of the Company to maintain our mineral or placer rights in good standing. Table of Contents (2) On June 24, 2013, the Company executed a definitive joint-venture agreement for mining operations on the Company s 100%-owned Fraser River Project near Lytton, British Columbia, with Solid Holdings Ltd. ( Solid ), a private company domiciled in British Columbia and based in Houston, BC. The terms of the agreement call for Solid to provide all equipment, personnel, and related expenditures required to initiate and sustain mining operations at the Fraser River Project JV. The Company will be responsible for maintaining the property in good standing and securing the permits required for mining operations to proceed. The Company will retain 100% ownership of the property, and will be paid a 20% NSR on all metals recovered from operations, with Solid retaining 100% of the net profits following payment of the aforementioned NSR. Solid will be deemed the project operator, and will be responsible for the day-to-day operations. On October 24, 2012, the Company entered into an agreement on its Willa property with Caribou King Resources Ltd. ("Caribou"), a Canadian issuer listed on the TSX Venture Exchange. Under the terms of agreement, Caribou may earn up to a 100% interest in the claims in the Willa property ( Willa Claims ) by making aggregate payments to North Bay of USD $232,500 in cash and issuing 1,000,000 shares of Caribou common stock. Of the aggregate payments, $7,500 in cash and 500,000 shares are due upon receipt of regulatory acceptance of the agreement by the TSX Venture Exchange. This regulatory approval has been received, and the initial consideration has been paid. An additional $50,000 cash and 500,000 shares of Caribou stock are due upon the first anniversary of the agreement, and a $175,000 cash payment is due upon the second anniversary of the agreement. In addition to the consideration received, North Bay shall be granted a royalty equal to 2% of NSR. At any time up to the commencement of commercial production, Caribou may purchase one-half of the NSR (being 1%) in consideration of USD $1,000,000 payable to North Bay, such that North Bay will then retain a 1% NSR. As of December 31, 2013 and the date of this prospectus, Caribou has defaulted on the agreement and forfeited any and all rights, thereby returning 100% control and ownership of the Willa to the Company. On January 9, 2014, the Company and our wholly-owned subsidiary, Ruby Gold, Inc. ("RGI"), executed a definitive joint-venture agreement (the Ruby JV Agreement ), with regard to the exploration and exploitation of the Ruby Mine in Sierra County, California (the "Ruby"). Under the terms of the Ruby JV Agreement, the Company will fund Ruby through loans, as needed, to maintain the property and operations thereof. RGI will remain the owner and operator of Ruby, and the Company shall be apportioned a 50% interest of net income distribution from Ruby once all debt has been extinguished. On July 15, 2014, the Company executed a mineral property option agreement ( Ximen Agreement )_with Ximen Mining Corp. ("Ximen"), a Canadian issuer listed on the TSX Venture Exchange, pursuant to which Ximen may earn up to a 100% interest in the Registrant's Brett West and Bouleau Creek mineral claims (the Brett West Claims ) in southeastern British Columbia. Under the terms of Ximen Agreement, Ximen may earn up to a 100% interest in the Brett West Claims by making aggregate payments to North Bay of USD $600,000, consisting of $300,000 in cash and issuing $300,000 in shares of Ximen common stock. Of the aggregate payments, $100,000 in cash and $100,000 in stock are due upon receipt of regulatory acceptance of the agreement by the TSX Venture Exchange, and equal payments of $50,000 cash and $50,000 in shares of Ximen common stock are each due upon the 1st, 2nd, 3rd, and 4th 6-month anniversaries of the Ximen Agreement. This regulatory approval has been received, and the initial consideration has been paid, including 217,391 shares of Ximen common stock at a market value on issuance of $0.46 per share. (3) Our primary cost in any option or joint venture agreements is typically the degree to which we give up our rights to any property. In the case of an option agreement, we give up all of our rights if all of the terms of the contract are fulfilled, and will only retain a NSR, typically 2%. In the case of a joint-venture, we will generally retain only 25% to 50% of our rights if all of the terms of the contract are fulfilled, and may be subject to further dilution should we elect not to further participate in the joint-venture. An exception to this is when a joint-venture is agreed to on a profit-sharing basis, where the Company elects to retain up to 100% ownership of the project, and both parties are obligated to contribute its share of the project development costs. Our properties in British Columbia are located and acquired through the use of a suite of online applications which are provided to people and companies licensed to acquire and maintain mineral rights within the Province of British Columbia. Mineral Titles Online ( MTO ) is an Internet-based mineral titles administration system provided and maintained by the British Columbia Ministry of Energy, Mines, and Petroleum Resources that allows the mineral exploration industry to acquire and maintain mineral titles by selecting the area on a seamless digital GIS map of British Columbia and pay the associated fees electronically. The MTO system is also interactively linked to British Columbia s MINFILE Project and Assessment Report Indexing System ( ARIS ), both of which are provided and maintained by the British Columbia Geological Survey. The MINFILE Project is a mineral inventory system that contains information on more than 12,300 metallic mineral, industrial mineral and coal occurrences in British Columbia. It is used by industry, governments, universities and the public to find information on documented mineralization anywhere in British Columbia, develop exploration strategies, conduct geoscience research, and evaluate the resource potential of an area. The ARIS database has over 30,500 approved mineral exploration assessment reports filed by the exploration and mining industry since 1947. These reports provide information on geological, geophysical, geochemical, drilling and other exploration-related activities throughout B.C. Both MINFILE and ARIS are interlinked with MTO, which combined and interfaced with other geospatial applications such as Google Earth, provide a skilled user with the ability to virtually visit any location in British Columbia, analyze its geographical and geological setting, access and evaluate its geological records and the historical archives of any prior development work, and determine the relative value of a given area. If the area is also open to staking, a claim can then be staked, and the required claim registration fees can be paid immediately and interactively. We are an exploration stage company and there is no assurance that a commercially viable mineral deposit exists on any of our properties. Further exploration will be required before any final evaluation as to the economic viability and feasibility of any of our mining projects can be determined. As filed with the Securities and Exchange Commission on October 14, 2014 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Table of Contents The Company plans on generating revenue through mining once commercial operations begin on any of its properties. Towards this end, the Company through our wholly-owned subsidiary RGI has acquired the Ruby Mine (the Ruby ) in Sierra County, California. The purchase price was $2,500,000, of which $510,000 in cash and stock was paid as of the closing date of July 1, 2011, and the remaining $1,990,000 is a seller-financed mortgage. The interest rate is currently 6% per annum, and will increase to 8% on January 1, 2015. The balance due on the mortgage is $1,726,186 as of June 30, 2014. The mortgage is to be paid in full by December 30, 2015 pursuant to amendments to the agreement executed on December 12, 2012, March 28, 2013, and November 19, 2013. As part of the terms of acquisition, the seller received 10 million shares of the Company s common stock with a market value of $150,000 as of the date the agreement was signed, and which was then applied to the purchase price. The seller has also been granted 10 million 5-year warrants exercisable at 2 cents upon the signing of the agreement. Pursuant to the aforementioned amendments, an additional 2 million 5-year warrants exercisable at 9 cents, 2 million 5-year warrants exercisable at 10 cents, and 4 million 5-year warrants exercisable at 4 cents have been issued. Pursuant to the aforementioned amendment dated November 19, 2013, the term of all 18 million of the outstanding warrants issued to the seller has been extended to December 30, 2018. This is an arms-length transaction, and there is no family or other relationship with any affiliate of the seller, Ruby Development Company, with any officer, director, or affiliate of North Bay Resources Inc. Operational funding for the Ruby project ( Ruby Project ) of up to $7.5 million was initially expected to be provided through the federal EB-5 program (the "EB-5 Program") described below. It is expected that this funding will be non-dilutive, as no shares of Company stock will be issued to EB-5 investors. The EB-5 funding will be debt, which must be repaid from mining operations over five years and at an interest rate of no more than 6%. In the interim, if the Company has not generated enough revenue from claim sales and joint-ventures to meet our commitments, we believe we can rely on loans and our equity credit line established by way of our Securities Purchase Agreement with Tangiers Investor LP ( Tangiers ) to cover our acquisition costs. The Company presently has an agreement with ACG Consulting, LLC ("ACG") intended to establish a new economic regional center ("Regional Center") under the federal EB-5 Program that will encompass all of Northern California's Gold Country. Once established, the Regional Center is expected to provide full funding for the Company's prospective mining projects in Northern California. EB-5 is a federal program authorized by the US Congress in the Immigration Act of 1990, and is intended to help stimulate the US economy by creating new jobs in rural areas or areas of high unemployment. The term "EB-5" is an acronym for "the fifth employment based visa preference category." As it implies, the source of the investment capital comes from overseas investors who wish to immigrate to the US by investing in a commercial enterprise that will benefit the US economy and create at least 10 full-time jobs. The program is administered by the United States Citizenship and Immigration Services ("USCIS"), as provided under Section 610 of Public Law 102-395. Since its inception in 1990, the EB-5 Program has been the conduit through which over $1 billion has been invested by foreign nationals in US enterprises to create jobs throughout the US economy. A USCIS designated Regional Center under the EB-5 Pilot Program is defined as any economic unit, public or private, engaged in the promotion of economic growth, improved regional productivity, job creation and increased domestic capital investment. Once USCIS has approved a Regional Center application, an investor seeking an EB-5 green card through the Regional Center Investment Program must make the qualifying investment of $1 million within an approved Regional Center. If the investment is also within a USCIS-designated targeted employment area, of which Sierra County, California, where the Ruby Mine is located, is so designated, then the minimum investment requirement is $500,000. Before an investor can participate in a Regional Center EB-5 investment program, each investor must independently petition USCIS for an EB-5 visa. USCIS solely determines whether the investor qualifies for the EB-5 visa. USCIS' diligence includes a detailed review of the sources of the investor's funds, family history, and other representations of the head of household and his immediate family members under the age of 21. Each investor must further demonstrate that at least 10 or more full-time jobs will be created directly or indirectly as a result of the investment into our project. Upon approval by USCIS, the Regional Center will serve as the legal vehicle through which investment capital may be solicited from foreign nationals under the EB-5 Program, in reliance upon Regulation S, to provide EB-5 financing for all approved industries within the Regional Center's designated geographical area. The new Regional Center will encompass all of what is commonly known as "Gold Country", which traverses State Route 49 from Plumas County in the north to Mariposa County in the south. The full extent of the Regional Center is expected to include all of the counties in Northern California from Monterey up to the Oregon border, and from the Pacific coastline across to the Nevada border. FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents The agreement provides that North Bay and ACG shall form a limited liability company ( LLC ) concurrent with the filing of our Regional Center application with USCIS, in which North Bay will own 49% of the Regional Center, and ACG will own 51%. ACG and North Bay, working together through the Regional Center, will seek to raise up to $7.5 million in EB-5 funding for North Bay's initial mining project, subject to USCIS approval. ACG will also be an equity partner by way of membership in a joint-venture LLC in each project North Bay may bring into the Regional Center, the amount of which will vary on a deal by deal basis based on the amount of consulting services ACG actually provides, and the amount of EB-5 funding actually received. At the present time, no projects other than mining are being considered, and the industry focus for the Regional Center is expected to be limited to mining initially. Terms of the agreement specify that upon filing an application for a new Regional Center with USCIS, North Bay shall pay ACG up to $50,000 as its share of the startup expenses. In lieu of cash, North Bay may elect to issue a convertible debenture to ACG, at an interest rate of 8%, and convertible to shares of common stock, the number of shares of which, if and when issued, shall be equal to the principal and interest to be paid on the date of conversion divided by the prevailing market price of our common stock on the date of conversion. In the event the Company does issue a convertible debenture, we expect it to be dilutive to shareholders, the extent of which will be determined by the market price of our shares on the day of conversion. In addition, upon receipt by the Company of the first tranche of EB-5 funding at a minimum of $500,000, the Company shall reimburse ACG for its share of the marketing expenses in the amount of $110,000 cash. The Company will await guidance from USCIS after the Regional Center is established as to whether marketing costs incurred to secure funds through the EB-5 Program can be recouped from EB-5 funds subsequently received. Alternatively, if the Company has not generated enough revenue from claim sales and joint-ventures to cover these costs, we believe we can rely on loans as well as our equity credit line established by way of our Securities Purchase Agreement with Tangiers to cover these expenses. As of December 31, 2013, the Company has paid a total of $37,216 in startup expenses incurred by ACG to prepare and file EB-5 applications with USCIS. These expenses have been paid in full, in cash, and as such there will be no convertible debenture issued in connection with this agreement. As of December 31, 2013, no shares have been or will be issued in connection with this agreement. Subsequent to the execution of the agreement with ACG, the Company was presented with the opportunity to include the Ruby Project within the scope of an existing USCIS-approved EB-5 Regional Center, and with the goal of expediting the approval process for the Ruby Project by USCIS, the Company, together with ACG, has entered into a Memorandum of Understanding with an existing Regional Center, the Northern California Regional Center, LLC ("NCRC"). NCRC has agreed to expand the scope of its USCIS-approved designation to include mining projects in the counties of Sierra and Nevada in Northern California, and together with ACG has agreed to sponsor North Bay's application to obtain $7.5 million through the EB-5 Program for the Ruby Project in Sierra County, California. NCRC was approved on April 22, 2010 by USCIS as a designated EB-5 Regional Center, and is currently approved to sponsor qualifying investments in such capacity within the Northern California counties of Colusa, Butte, Glenn, Sacramento, San Joaquin, Shasta, Sutter, Tehama, Yuba and Yolo. Pursuant to its regional center designation, NCRC may sponsor qualifying investments in certain industry economic sectors that do not currently include mining. The Memorandum of Understanding provides that NCRC will seek USCIS approval for an expansion of NCRC s Regional Center Geographic Area (the Expansion ) to include the counties of Nevada and Sierra, where the Ruby Mine is located, and for approval to include mining within its designated industry sectors (the Mining Designation ). The applications and all supporting documentation required by USCIS were filed by NCRC in January, 2011. In July, 2011, NCRC received formal approval by USCIS for the expansion of the Regional Center, and the inclusion of the Ruby Mine as a qualified EB-5 project. With the approval of the Expansion and Mining Designation by USCIS, NCRC is now permitted to sponsor qualified investments in North Bay s Ruby Project under the EB-5 Program. The Memorandum of Understanding provides that NCRC will receive a $5,000 administrative fee to be paid by each investor independent of the investor s minimum EB-5 investment of $500,000. In addition, upon the Ruby Project receiving the aggregate sum of $7,500,000 through the EB-5 Program, NCRC shall be entitled to an undivided one and one half percent (1.5%) interest in the Ruby Project. No shares of Company stock have been or will be issued in connection with this agreement, and the entire EB-5 funding is expected to be non-dilutive to shareholders. While a new Regional Center remains a long-term goal of North Bay and ACG, the agreement to bring the Ruby Project within the scope of a pre-existing Regional Center is seen by the Company as the most efficient and expeditious way to complete funding for the Ruby Project through the EB-5 Program in the near-term. This is an arms-length agreement, and neither the Company nor any of its officers or directors has any ownership position or pre-existing relationship with NCRC. NORTH BAY RESOURCES INC. (Exact name of registrant as specified in its charter) Delaware 1000 83-0402389 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (IRS Employer Identification No.) PO Box 162, Skippack, Pennsylvania 19474 (215) 661-1100 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents Procedurally, once USCIS has approved the Ruby Project, regardless of whether under the auspices of NCRC s Regional Center or a new Regional Center owned by North Bay and ACG, the Regional Center will organize a limited partnership ( LP ) that will be made up of the foreign investors, as limited partners, each of whom will subscribe to a Regulation S offering and purchase a unit in the LP at the purchase price of $500,000. Each investor will complete and deliver to the LP a subscription agreement, and will pay a minimum of $500,000 into an escrow account, which will be held in escrow until the investor s I-526 petition filed with USCIS has been either approved or denied by USCIS. If the investor s I-526 petition is denied by USCIS the Escrow Agent will return the investor s funds to the investor. If the I-526 petition is approved the Escrow Agent will pay the investment to the LP. As each new investor's I-526 petition is approved by USCIS and funds are released from escrow, the LP will then loan the funds to the Ruby Project. To facilitate receipt by the Ruby Project of EB-5 funding from the investor LP and to comply with USCIS requirements, the Ruby Project must be organized as an original business and a new enterprise under the EB-5 Program. Accordingly, North Bay and ACG have therefore jointly organized an appropriate special purpose entity as a limited liability company domiciled in California called Ruby Gold, LLC (the "JV") that will own and operate the Ruby Project. The initial ownership/membership interest in the JV will be held 60% by North Bay and 40% by ACG. Once approved by USCIS, it is expected that the EB-5 funding for the Ruby Project will then come from the investor LP in the form of a loan to the JV. Governance of the JV shall be through a board of directors (the "JV Board"). The appointment of the members of the JV Board shall be allocated between North Bay and ACG on a pro rata basis of their ownership/membership interest in the JV, provided however, that from the date on which the JV is organized and at all times subsequent thereto, at least one member of the JV Board shall be appointed by ACG. The operating agreement of the JV shall provide that the number of members of the JV Board shall be adjusted from time to time so as to reflect North Bay's and ACG's respective ownership/membership interest in the JV. Additionally, the operating agreement of the JV shall provide that if the initial capital contributions made by the owner/members of the JV shall not be sufficient to operate the Ruby Project, then any such required or desired capital shall be satisfied by the JV borrowing such capital. As determined by the agreement with ACG dated July 28, 2010, net income from the Ruby Project is to be distributed as follows: (a) until the first $3,000,000 of the EB-5 Financing is returned to the EB-5 investors, 80% of the net profits from the Ruby Project will be returned to the EB-5 investors and 20% will be distributed to the owners of the JV; (b) after the first $3,000,000 of the EB-5 Financing is returned to the EB-5 investors and until the entire amount of the EB-5 Financing has been returned to the EB-5 investors, 70% of the net profits from the Ruby Project will be returned to the EB-5 investors and 30% will be distributed to the owners of the JV; (c) after the entire amount of the EB-5 Financing has been returned to the EB-5 investors, 100% of the net profits from the Ruby Project will be distributed to the owners of the JV. By virtue of the loan covenant dated September 27, 2010 with Tangiers and the Memorandum of Understanding dated October 14, 2010 with NCRC, the interests of Tangiers (0.75%) and NCRC (1.5%) are included in the net profit distributions to the owners of the JV. The loan from Tangiers was satisfied and retired in the first quarter of 2011, but the profit interest agreed to and described herein remains in effect. The Company notes that its intention to utilize EB-5 funding is a matter of economics and the success of the Ruby Project itself is not exclusively contingent on the EB-5 financing heretofore disclosed. Unless and until all of the milestones related to USCIS approvals for EB-5 are achieved and funds are received, the Company may elect to accept alternative funding should a suitable funding source be identified and acceptable terms negotiated. As of the date of this prospectus, the EB-5 funding remains pending, the Company has not received any funding through the EB-5 program, and there is no guarantee that it will be completed. Accordingly, given the length of time this process has been ongoing, as of the date of this prospectus the Company has elected to proceed on its own by funding the project through loans and stock issuances. On December 2, 2013, the Board of Directors authorized the spinoff of RGI as a separate and independent public company by distributing shares of RGI s common stock to North Bay shareholders based on a date and at a ratio yet to be determined. Other than the authorization for said spinoff by our Board of Directors and the Board of RGI, there are no agreements, formal or otherwise, in place between the respective companies, any affiliate of either company, or any other parties governing the spinoff, and no shareholder approvals are required. On the same date, the Board of Directors of RGI authorized the formalization of a joint-venture agreement between the Company and RGI with regard to Ruby on a 50/50 profit-sharing basis. On January 14, 2014, RGI filed a registration statement on Form 10 with the SEC to initiate said spinoff. On March 10, 2014, RGI withdrew the Form 10 after discussions with the SEC and subsequently filed a registration statement on Form S-1 on May 1, 2014, to register 120 million shares of RGI as the stock dividend to be issued to our shareholders in the spinoff, which amounts to 40% of the issued and outstanding shares of RGI common stock currently owned by North Bay. Accordingly, as the completion of the spinoff is contingent on a registration statement by RGI becoming effective, no determination has yet been made as to whether or not the stock dividend will be tax-free, there has been no further determination as to when the spinoff and stock dividend distribution might be completed, and there is no guarantee that it will be completed. Table of Contents On June 4, 2013, the Company executed a Memorandum of Understanding (the June 2013 Agreement ) with a private US investor (the June 2013 Investor ) for an advance sale of up to 120 ounces of specimen gold from the Ruby Mine in Sierra County, California. The price paid in advance by the June 2013 Investor shall be at a ten percent (10%) discount to the then-current spot price of gold on the day the gold is produced and made available for shipment (the June 2013 Delivery Date ). The June 2013 Investor will acquire the right to purchase the gold at their discretion. Upon signing the June 2013 Agreement, the Company received an initial cash advance of $150,000 (the June 2013 Advance ), which is based on a 10% discount to the current spot price of gold, for delivery of the first 120 ounces of specimen gold produced from the Ruby Mine on or before February 1, 2014. The June 2013 Advance paid will be applied to the amount due to the Company on the June 2013 Delivery Date, as determined by the then-current spot price of gold on the June 2013 Delivery Date. In the event that 120 ounces of specimen gold is not available for delivery by February 1, 2014, the June 2013 Investor will be entitled to be repaid the June 2013 Advance in cash plus 10% interest equal to $165,000 total, with an option to still purchase the same amount of gold at a discount of 10% to the then-current spot price of gold when the specimen gold becomes available for delivery at a later date As of the date of this prospectus, the Company has repaid the entire cash advance plus interest. As per the terms of the agreement, the investor still retains the right to again purchase the 120 ounces of gold at a future date. On August 2, 2013, the Company executed a Memorandum of Understanding (the August 2013 Agreement ) with a second private US investor (the August 2013 Investor ) for an advance sale of up to 40 ounces of specimen gold from the Ruby Mine in Sierra County, California. The price paid in advance by the August 2013 Investor shall be at a ten percent (10%) discount to the then-current spot price of gold on the day the gold is produced and made available for shipment (the August 2013 Delivery Date ). The August 2013 Investor will acquire the right to purchase the gold at their discretion. Upon signing the Agreement, the Company received an initial cash advance of $50,000 (the August 2013 Advance ), which is based on a 10% discount to the current spot price of gold, for delivery of 40 ounces of specimen gold produced from the Ruby Mine on or before April 2, 2014. The August 2013 Advance paid will be applied to the amount due to the Company on the August 2013 Delivery Date, as determined by the then-current spot price of gold on the Delivery Date. In the event that 40 ounces of specimen gold is not available for delivery by April 2, 2014, the August 2013 Investor will be entitled to be repaid the August 2013 Advance in cash plus 10% interest equal to $55,000 total, with an option to still purchase the same amount of gold at a discount of 10% to the then-current spot price of gold when the specimen gold becomes available for delivery at a later date. As of the date of this prospectus, the Company has repaid the entire cash advance plus interest. As per the terms of the agreement, the investor still retains the right to again purchase the 40 ounces of gold at a future date. Our CEO, Mr. Perry Leopold owns 100 shares of the Company s Series I Preferred Stock. Each outstanding share of the Series I Preferred Stock represents its proportionate share of eighty per cent (80%) of all votes entitled to be voted and which is allocated to the outstanding shares of Series I Preferred Stock and therefore Mr. Leopold is able to control the outcome of most corporate matters on which our shareholders are entitled to vote. These shares are not convertible into common stock or any commodities. The Series I Preferred Stock was issued in February 2007. These shares were issued to our Chief Executive Officer, Mr. Perry Leopold, in February 2007 as an anti-takeover measure to insure that Mr. Leopold maintains control of the Company during periods when the Company s stock may be severely undervalued and subject to hostile takeover in the open market. As specified in the Certificate of Designation filed by the Company with the Delaware Secretary of State in February 2007, the outstanding shares of Series I Preferred Stock shall vote together with the shares of Common Stock of the Corporation as a single class and, regardless of the number of shares of Series I Preferred Stock outstanding and as long as at least one of such shares of Series I Preferred Stock is outstanding, shall represent eighty percent (80%) of all votes entitled to be voted at any annual or special meeting of shareholders of the Corporation or action by written consent of shareholders. Each outstanding share of the Series I Preferred Stock shall represent its proportionate share of the 80% which is allocated to the outstanding shares of Series I Preferred Stock . Our headquarters are located at 2120 Bethel Road, Lansdale, PA 19446, with a mailing address of PO Box 162, Skippack, PA 19474. Our website is located at www.northbayresources.com. Our telephone number is (215) 661-1100. Table of Contents Title of Class of Securities to be Registered(1) Amount to be Registered Proposed Maximum Offering Price Per Share Proposed Maximum Aggregate Offering Price Amount of Registration Fee Common stock, $0.0001 par value 91,224,228 (1) $ 0.0018 (2) $ 164,204 $ 22.40 (1) Pursuant to Rule 416, this registration statement also covers such indeterminate number of additional shares of common stock that became issuable by reason of any stock dividend, stock split, recapitalization or other similar transactions. (2) Estimated at $0.0018 per share, the average of the high and low prices as reported on the OTC Pink Market on October 8, 2014, for the purpose of calculating the registration fee in accordance with Rule 457(c) under the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents Going Concern Our consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has generated modest revenues since inception and has never paid any dividends and is unlikely to pay dividends. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations and to determine the existence, discovery and successful exploration of economically recoverable reserves in its resource properties, confirmation of the Company s interests in the underlying properties, and the attainment of profitable operations. The Company has had very little operating history to date. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. We have experienced recurring net losses from operations, which losses have caused an accumulated deficit of $16,595,148 as of June 30, 2014. In addition, we have a working capital deficit of $3,295,570 as of June 30, 2014. We had a net loss of $1,059,995 for the six months ended June 30, 2014, and we had net losses of $2,059,305 and $2,119,706 for the years ended December 31, 2013 and 2012, respectively. These factors, among others, raise substantial doubt about our ability to continue as a going concern. If we are unable to generate profits and are unable to continue to obtain financing to meet our working capital requirements, we may have to curtail our business sharply or cease operations altogether. Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis to retain our current financing, to obtain additional financing, and, ultimately, to attain profitability. Should any of these events not occur, we will be adversely affected and we may have to cease operations. As of December 31, 2013 the accumulated deficit attributable to CEO stock awards, including previous management, and valued according to GAAP, totals $2,558,535 since inception in 2004. As of December 31, 2013 the accumulated deficit attributable to CEO compensation is $820,474 in deferred compensation. This reflects the total amounts unpaid as per the management agreement with The PAN Network dating back to January 2006, less any amounts actually paid or forgiven since 2006. These totals are non-cash expenses which are included in the accumulated deficit since inception. Actual CEO compensation paid in cash over the course of the seven years since 2006 consists of $10,000 in 2006, $50,764 in 2007, $23,139 in 2008, $29,979 in 2009, $21,988 in 2010, $90,000 in 2011, $116,000 in 2012, and $100,000 in 2013. These cash expenditures are also included in the accumulated deficit. The ongoing execution of our business plan is expected to result in operating losses over the next twelve months. Management believes it will need to raise capital through loans or stock issuances in order to have enough cash to maintain its operations for the next twelve months. There are no assurances that we will be successful in achieving our goals of obtaining cash through loans, stock issuances, or increasing revenues and reaching profitability. In view of these conditions, our ability to continue as a going concern is dependent upon our ability to meet our financing requirements, and to ultimately achieve profitable operations. Management believes that its current and future plans provide an opportunity to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that may be necessary in the event we cannot continue as a going concern. Table of Contents THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. SUBJECT TO COMPLETION OCTOBER 14, 2014 PROSPECTUS NORTH BAY RESOURCES INC. 91,224,228 Shares of Common Stock This prospectus relates to the sale of up to 91,224,228 shares of our common stock by Tangiers Investors LP ( Tangiers ). The prices at which the selling stockholder may sell the shares will be determined by the prevailing market price for the shares or in negotiated transactions. We will not receive proceeds from the sale of the shares by the selling stockholder. However, we may receive proceeds of up to approximately $164,204 from the sale of our common stock to the selling stockholder, pursuant to a Securities Purchase Agreement, as amended, entered into with the selling stockholder on October 7, 2009 ( Securities Purchase Agreement ), once the registration statement ( Registration Statement ), of which this prospectus is a part, is declared effective. The shares offered include up to 91,224,228 shares of common stock which may be sold from time to time to Tangiers up to 60 months from the initial effective date of January 24, 2011. The shares covered herein are only a portion of the shares covered by the Securities Purchase Agreement. The remaining shares that are subject of this agreement may be included in future registration statements at our option (See About This Offering and Tangiers Transaction , below) Tangiers Capital, LLC ( Tangiers Capital ), which makes the investment decisions on behalf of and controls Tangiers, is an underwriter within the meaning of the Securities Act of 1933, as amended. We will pay the expenses of registering these shares, but all selling and other expenses incurred by Tangiers Capital will be paid by Tangiers Capital. Our common stock is currently quoted on OTC Pink under the symbol NBRI . The last reported sales price of our common stock on the OTC Pink market on October 8, 2014, was $0.0019 per share. INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE RISK FACTORS BEGINNING ON PAGE 10 TO READ ABOUT FACTORS YOU SHOULD CONSIDER BEFORE BUYING SHARES OF OUR COMMON STOCK. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OF ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. The date of this Prospectus is ______, 2014 Table of Contents
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights selected information from this prospectus and may not contain all the information that is important to you. To understand our business and this offering fully, you should read this entire prospectus carefully, including the financial statements and the related notes beginning on page F-1. This prospectus contains forward-looking statements and information relating to Megas, Inc. See Cautionary Note Regarding Forward Looking Statements on page 8. Our Company The Company was formed on September 17, 2009 in the State of Nevada. The selling shareholders in this offering are underwriters. Business Strategy We are a development stage company. As a premier lifestyle brand Megas will provide a home based business & entrepreneurial opportunity for individuals by bridging entertainment events and cutting edge wellness products. Through leveraging online social communities and building a strong company culture through live entertainment based events, Megas will become the leading force in the wellness industry for the Gen Y population. We will unite millions of people by combining entertainment and education to develop happy healthy individuals who are prepared for a successful future. The Company has an accumulated deficit of $17,486,586 since inception and our auditors issued a going concern opinion in its June 30, 2013 audit. Our executive offices are located at 1291 Galleria Dr. Suite 220, Henderson, NV 89014. Our telephone number is (702) 900-5550. The Company is an emerging growth company under the Jumpstart Our Business Startups Act. The Company shall continue to be deemed an emerging growth company until the earliest of— , ' ': (A) the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; , ' ': (B) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title; , ' ': (C) the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or , ' ': (D) the date on which such issuer is deemed to be a , ' ': large accelerated filer , as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto. . As an emerging growth company the company is exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company the company is exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. The Company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. The Offering This prospectus covers up to 8,234,821 shares to be sold by our selling shareholders who will sell at a fixed price of $0.02 per share until the prices of our common stock are quoted on the OTCBB and thereafter at prevailing market prices or privately negotiated prices. ABOUT THIS OFFERING Securities Being Offered Up 8,234,821 shares of common stock of Megas, Inc. to be sold by selling shareholders who will sell at a fixed price of $0.02 per share. The selling shareholders in this offering are underwriters. Initial Offering Price Up 8,234,821 shares of common stock of Megas, Inc. to be sold by selling shareholders at a fixed price of $0.02 per share. Terms of the Offering The selling shareholders will sell at a fixed price of $0.02 per share. Termination of the Offering The offering will conclude when the selling shareholder have sold all of the 8,234,821 shares of common stock offered by them.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001476651_fcb_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001476651_fcb_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001479290_revance_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001479290_revance_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere or incorporated by reference in this prospectus and does not contain
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001479320_vibe_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001479320_vibe_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..42b07705ca3b77363a09b864975d5e0aa6be0360
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@@ -0,0 +1,150 @@
+Prospectus
+ Summary
+ Page
+ 5
+
+ The
+ Offering
+ Page
+ 6
+
+ Selected
+ Summary Financial Data
+ Page
+ 7
+
+ Risk
+ Factors
+ Page
+ 8
+
+ Use
+ of Proceeds
+ Page
+ 12
+
+ Dilution
+ Page
+ 13
+
+ Our
+ Business
+ Page
+ 20
+
+ Management s
+ Discussion, Analysis, or Plan of Operation
+ Page
+ 23
+
+ Recently
+ Issued Accounting Pronouncements
+ Page
+ 27
+
+ Market
+ for Common Equity and Related Stockholder Matters
+ Page
+ 28
+
+ Directors,
+ Executive Officers, Promoters, Control Persons
+ Page
+ 29
+
+ Executive
+ Compensation
+ Page
+ 30
+
+ Certain
+ Relationships and Related Transactions
+ Page
+ 31
+
+ Security
+ Ownership of Certain Beneficial Owners and Management
+ Page
+ 31
+
+ Description
+ of Securities
+ Page
+ 32
+
+ Plan
+ of Distribution
+ Page
+ 32
+
+ Regulation
+ M
+ Page
+ 35
+
+ Experts
+ Page
+ 36
+
+ Interest
+ of Named Experts and Counsel
+ Page
+ 36
+
+ Available
+ Information
+ Page
+ 37
+
+ Financial
+ Statements
+ Page
+ 38-83
+
+ 
+
+4
+
+A CAUTIONARY NOTE
+ON FORWARD-LOOKING STATEMENTS
+
+This prospectus
+contains forward-looking statements, which relate to future events or our future financial performance. In some cases, you can
+identify forward-looking statements by terminology such as may, should, expects, plans, anticipates, believes, estimates, predicts,
+potential, or continue or the negative of these terms or other comparable terminology. These statements are only predictions and
+involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled Risk Factors, that
+may cause our or our industry's actual results, levels of activity, performance, or achievements to be materially different from
+any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements.
+
+While these forward-looking
+statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the
+direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections,
+assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws
+of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
+
+ 
+
+ 
+
+PROSPECTUS
+SUMMARY
+
+The following is
+only a summary of the information, financial statements and the notes included in this prospectus. You should read the entire
+prospectus carefully, including "Risk Factors" our Financial Statements and the notes to the Financial Statements
+before making any investment decision.
+
+The following summary
+highlights selected information contained in this Prospectus. This summary does not contain all the information that may be important
+to you. You should read the more detailed information contained in this Prospectus, including but not limited to, the risk factors
+herein. In addition, certain statements are forward-looking statements which involve risks and uncertainties. See "Disclosure
+Regarding Forward-Looking Statements."
+
+References in this
+Prospectus to "Vibe Ventures", "Vibe", "Company", "we", "our", or
+"us" refer to Vibe Ventures, Inc. unless otherwise indicated or the context otherwise requires.
+
+OUR COMPANY
+
+We were incorporated
+in Nevada on, October 19, 2009 and are a company in the development stage.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001487522_innovision_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001487522_innovision_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..032bbba1a69e32e70932ddf0aac8c14a86ab6715
--- /dev/null
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+information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding to invest in our Common Stock. You should read this entire prospectus, including the section entitled "Risk Factors," and our financial statements and the notes thereto contained herein before deciding to invest in our Common Stock. Unless the context otherwise requires, the terms "we," "us," "our" or "GlassesOff" refer to the business of GlassesOff Inc. and its consolidated subsidiaries, Ucansi Inc. and EYEKON E.R.D. LTD, which comprise our operating subsidiaries and all of our operations as of the date of this Registration Statement on Form S-1. Our Company Overview We are a development stage neuroscience software technology company, utilizing patented technology to develop and commercialize consumer-oriented software applications for improving, through exercise, near vision sharpness by improving the image processing function in the visual cortex of the brain. We deliver our products through a cloud-based client server architecture to hand-held devices, currently implemented on the Apple iOS platform (iPhone, iPod, iPad), and which are planned to be offered on additional platforms, such as Android and Windows Phone platforms. Recent Developments Standby Equity Distribution Agreement On July 1, 2014, we entered into the SEDA with YA Global, pursuant to which we may, at our election and in our sole discretion, issue and sell to YA Global, from time to time as provided in the SEDA, and YA Global has agreed to purchase, up to $15,000,000 of Common Stock. We sometimes refer to the Common Stock issuable under the SEDA as the Equity Line Shares. In accordance with the terms and subject to the conditions contained in the SEDA, we may elect from time to time, in our sole discretion, to sell Equity Line Shares to YA Global, which we refer to, in each case, as an Advance, at a per share price equal to 98.5% of the lowest daily volume weighted average price of the Common Stock as quoted by Bloomberg, L.P., which we refer to as the Market Price, during the five consecutive trading days commencing immediately subsequent to the date on which we deliver to YA Global a notice of our election to effect an Advance, which we refer to as an Advance Notice. In no event will the Market Price be less than 85% of the daily volume weighted average price of the Common Stock on the trading day immediately preceding the date of the Advance Notice. The amount of each Advance may not exceed the lesser of (x) $500,000 or (y) the Daily Value Traded for the five consecutive trading days immediately prior to the date of the applicable Advance Notice. The "Daily Value Traded" is the product obtained by multiplying the trading volume for a given day by the volume weighted average price of the Common Stock for such date as reported by Bloomberg L.P. during regular trading hours for such day. Pursuant to the SEDA, YA Global is obligated to purchase the Equity Line Shares subject to certain conditions, including, among others, our filing of a registration statement with the SEC to register the resale by YA Global of the Equity Line Shares acquired pursuant to the SEDA and the effectiveness of such registration statement. Unless earlier terminated in accordance with its terms, the SEDA will terminate automatically on the earliest of (i) the first day of the month next following the 36-month anniversary of the date of the SEDA and (ii) the date on which YA Global shall have purchased Equity Line Shares in the aggregate amount of $15,000,000. Pursuant to the terms of the SEDA, the Company agreed to pay to YA Global or its designee a structuring and due diligence fee in an amount equal to $3,000 and a commitment fee in an aggregate amount of up to $450,000, which is payable either in cash or shares of Common Stock. The first $150,000 of the commitment fee became payable upon execution of the SEDA, and the Company issued to YA Global II an aggregate of 103,301 shares of Common Stock in satisfaction thereof. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered (1) Proposed Maximum Offering Price Per Share (2) Proposed Maximum Aggregate Offering Price (2) Amount of Registration Fee Common Stock, par value $0.001 per share 5,000,000 $1.00 $5,000,000.00 $644.00 (1)Pursuant to Rule 416 of the Securities Act of 1933, as amended (the "Securities Act"), this Registration Statement also registers such additional shares of common stock, par value $0.001 per share ("Common Stock"), of GlassesOff Inc., a Nevada corporation (the "Registrant"), as may become issuable as a result of stock splits, stock dividend, recapitalizations or similar transactions effected without the receipt of consideration that results in an increase in the number of the Registrant s outstanding shares of Common Stock. (2)Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) under the Securities Act based on the average of the high and low bid prices per share of Common Stock reported by the OTCBB on July 25, 2014. The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. For additional details regarding the SEDA, please see the section entitled "The Standby Equity Distribution Agreement" contained in this prospectus. May 2014 Private Placement On May 16, 2014, we issued and sold an aggregate of 4,000,000 shares of Common Stock at a purchase price of $1.25 per Share. Before expenses, the private placement provided $5.0 million of gross proceeds to us. We issued such shares in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act, and Rule 506 of Regulation D promulgated thereunder. In connection with this private placement, we agreed to use our reasonable best efforts to file with the SEC a registration statement registering for resale by the selling stockholders all shares of Common Stock issued in the private placement. History On June 26, 2013, we (at the time known as Autovative Products, Inc.) entered into that certain Agreement and Plan of Merger, as amended by that certain First Amendment to Agreement and Plan of Merger, dated as of July 2, 2013, which we refer to collectively as the Merger Agreement, with Ucansi Acquisition Corp., a Delaware corporation and our wholly owned subsidiary, which we refer to as Merger Sub, and Ucansi Inc., a Delaware corporation, which we refer to as Ucansi. Pursuant to the Merger Agreement, on July 30, 2013, which we refer to as the Merger Closing Date, Merger Sub merged with and into Ucansi, with Ucansi surviving the merger as our wholly owned subsidiary, which we refer to as the Merger. Upon consummation of the Merger, we changed our name from Autovative Products, Inc. to GlassesOff Inc. Pursuant to the Merger Agreement, all shares of Ucansi s common and preferred stock that were issued and outstanding immediately preceding the Merger were converted into the right to receive an aggregate of approximately 40,000,000 shares of Common Stock after giving effect to a 7.5-for-1 forward split of our Common Stock, which we refer to as the Forward Split. Immediately following the Merger, Ucansi s former stockholders held approximately 80% of our issued and outstanding Common Stock. Additionally, pursuant to the Merger Agreement, upon consummation of the Merger, we assumed all of Ucansi s options and warrants that were issued and outstanding immediately prior to the Merger and issued to the holders of such securities in exchange therefor options and warrants to acquire approximately 9,019,872 shares and 7,523,504 shares of our Common Stock, respectively, in each case after giving effect to the Forward Split. The consolidation effected by the Merger has been accounted for as a reverse acquisition wherein Ucansi has been treated as the acquirer for accounting purposes as it acquired control of the combined enterprise. The Spin-Off On or about December 31, 2012, we contributed all of the operations, assets and liabilities of our historical business, which we refer to as the Legacy Business, generally comprising the distribution and development of automotive parts, to a newly-formed wholly owned subsidiary, Autovative Technologies, Inc. On May 23, 2013, we entered into a spin-off agreement, which we refer to as the Spin-Off Agreement, with our former Chairman of the Board and Chief Executive Officer, David Funderburk, pursuant to which, effective on the Merger Closing Date, we sold, assigned, transferred and conveyed to Mr. Funderburk all of the issued and outstanding capital stock of Autovative Technologies, Inc. in exchange for which Mr. Funderburk has agreed to indemnify us for, and hold us harmless from, any and all losses and liabilities arising out of, or relating to, the Legacy Business. Amended Articles and Bylaws; Trading Symbol In connection with the Merger, our Board of Directors and holders of in excess of a majority of our issued and outstanding Common Stock voted to amend our Articles of Incorporation, which we refer to as our Amended and Restated Articles to (i) increase our capitalization to provide for the issuance of up to 200,000,000 shares of our Common Stock and up to 20,000,000 shares of "blank check" preferred stock, par value $0.001 per share, and (ii) change our name from Autovative Products, Inc. to "GlassesOff Inc." In connection with our name change, our Common Stock, which was traded on the OTCBB under the symbol "ATVP" is now traded under the symbol "GLSO". Also in connection with the Merger, our Board of Directors amended and restated our bylaws, which we refer to as our Amended and Restated Bylaws. The information in this prospectus is not complete and may be changed. The selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any state where the offer or sale is not permitted. Preliminary Prospectus Subject to Completion, dated September 19, 2014 5,000,000 Shares Common Stock This prospectus relates to the resale by the selling stockholders named herein, which we refer to as the selling stockholders, of up to an aggregate of 5,000,000 shares of common stock, par value $0.001 per share, of GlassesOff Inc., which we refer to as Common Stock. As used in this prospectus, the term "selling stockholders" means YA Global Master SPV Ltd., also referred to as YA Global, and YA Global II SPV LLC, also referred to as YA Global II, together with their respective pledgees, transferees or other successors in interest selling shares of Common Stock received from either YA Global or YA Global II after the date of this prospectus as a gift, pledge or other non-sale-related transfer. GlassesOff Inc. is not selling any securities under this prospectus and will not receive any of the proceeds from the sale of shares of Common Stock by the selling stockholders. References in this prospectus to the "Company," "we," "our," and "us" refer to GlassesOff Inc., together with its consolidated subsidiaries. The shares of Common Stock offered by the selling stockholders hereunder have been or may be issued pursuant to a standby equity distribution agreement, referred to as the SEDA, which we entered into with YA Global on July 1, 2014. YA Global II is an affiliate of YA Global, having the same beneficial owners as YA Global. In the ordinary course of YA Global s business, YA Global directs certain fees otherwise payable to YA Global in connection with various transactions to instead be paid to YA Global II. Pursuant to the terms of the SEDA, the Company agreed to pay to YA Global or its designee a commitment fee in an aggregate amount of up to $450,000, which is payable either in cash or shares of Common Stock. The first $150,000 of the commitment fee became payable upon execution of the SEDA, and, at the direction of YA Global, the Company issued to YA Global II (as YA Global s designee) an aggregate of 103,301 shares of Common Stock in satisfaction thereof. Please refer to the section of this prospectus entitled "Standby Equity Distribution Agreement" for a description of the SEDA and the section entitled "Selling Stockholders" for additional information regarding YA Global and YA Global II. The price per share of the Common Stock to YA Global under the SEDA equals 98.5% of the lowest daily volume weighted average price of the Common Stock as quoted by Bloomberg, L.P., which we refer to as the Market Price, during the five consecutive trading days commencing immediately subsequent to the date on which we deliver to YA Global a notice of our election to effect an advance under the SEDA. In no event will the Market Price be less than 85% of the daily volume weighted average price of the Common Stock on the trading day immediately preceding the date on which we deliver such notice to YA Global. We are bearing all of the expenses in connection with the registration of the shares of Common Stock, but all selling and other expenses incurred by the selling stockholders, including commissions and discounts, if any, attributable to the sale or disposition of shares of Common Stock will be borne by the selling stockholders. The shares of Common Stock described in this prospectus may be offered for sale by the selling stockholders from time to time on the OTCBB or any other stock exchange, market or trading facility on which the shares are traded, in privately negotiated transactions or in any combination of the foregoing. These sales may be at fixed or negotiated prices, which will be determined only at the time of sale by then prevailing market prices for our Common Stock or otherwise at negotiated prices. The selling stockholders are not required to sell any specific number of shares or dollar amount of Common Stock. We will not receive any proceeds from the sale of shares of Common Stock by the selling stockholders. Please see "Plan of Distribution" beginning on page 55. The shares of Common Stock described in this prospectus may be offered for sale from time to time by the selling stockholders. The selling stockholders may offer and sell the shares in a variety of transactions as described under the heading "Plan of Distribution" beginning on page 55. The Securities and Exchange Commission, which we refer to as the SEC, may take the view that, under certain circumstances, any broker-dealers or agents that participate with the selling stockholders in the distribution of the shares may be deemed to be "underwriters" within the meaning of the Securities Act of 1933, as amended, which we refer to as the Securities Act. Under the Securities Act, commissions, discounts or concessions received by any such broker-dealer or agent may be deemed to be underwriting commissions. YA Global and YA Global II have informed us that each is an "underwriter" within the meaning of Section 2(a)(11) of the Securities Act. In addition to the 5,000,000 shares of Common Stock offered hereby, certain shareholders of the Company, other than the selling stockholders named in this prospectus, are concurrently offering 4,000,000 shares of Common Stock under our Registration Statement on Form S-1 (file no. 333-197432) and 53,303,534 shares of Common Stock under our Registration Statement on Form S-1, as amended (file no. 333-191951). Our Common Stock is quoted on the OTCBB under the symbol "GLSO". The last reported sale price of the Common Stock on the OTCBB on September 17, 2014 was $1.15 per share. An investment in our Common Stock involves substantial risks. See "Risk Factors" beginning on page 5 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2014. Plan of Operation During December 2013, we completed the development of the first commercial version of our consumer-oriented software application for improving, through exercise, near vision sharpness by improving the brain s image processing function, for the iOS platform and began marketing the product to end consumers via Apple s App Store. During 2014, and specifically following the anticipated launch of our first product version for the Android platform, we plan to gradually increase our marketing and public relations campaigns, aiming to increase the awareness to our product and increase our number of customers. Additionally, we plan to participate in various conferences and conventions around the world to further expose our product and technology to professional audience and potentially form business partnerships. In 2014, we have been developing our first product version for the Android platform, which we launched as planned on June 30, 2014, as a beta version. We are not currently planning any major purchase or sale of equipment in 2014, but expect that employee headcount will increase. Industry Background and Target Markets As we age, we normally experience changes in reading abilities. These changes are influenced, among other factors, by our brain s visual processing capabilities. The effect of these changes on most people results in slower, more difficult and less effective reading. According to a scientific review (Holden, B. A. et al., 2008), more than one billion people worldwide suffer from such age-related changes and this number is expected to rise significantly through 2050. At some point, natural age-related changes in reading abilities affect most people, who typically attempt to improve their reading abilities through the aid of magnifying devices, typically reading glasses. Such devices increase the size of words in reading material, making it easier for a person who uses them, whether that person is in his or her twenties or fifties, to read easily and quickly. The GlassesOff product enhances, through exercise, the image processing capabilities of the brain and thus improves a person s reading abilities. The use of the GlassesOff product results in faster, more efficient and more comfortable reading, thereby correcting reading vision without use of reading glasses. Competition Our initial product competes in the market of solutions for better, faster and more effective reading. The natural changes in reading capabilities with age have typically been addressed by traditional products for improvement of reading capabilities, mainly magnification devices, such as reading glasses or contact lenses, that support reading. Manufactures of such magnifier devices could therefore be considered as competition. We believe that our product, which is designed to eliminate the constant dependency on magnifiers, is therefore highly competitive with such devices. In addition, there are several methods and products that claim to improve reading vision through various means, usually related to muscle exercises (e.g. the Bates method, the See Clearly Method and the Power Vision Program), whereas the GlassesOff solution does not involve any such corrective methods. Finally, there are several competitors offering vision improvement solutions based on neuroscience methods, such as PositScience and RevitalVision (which obtained FDA clearance for a product that treats amblyopia, a condition typically referred to as "Lazy Eye"). We believe that there is no other software solution for the improvement of reading capabilities to the extent that magnifying devices, such as reading glasses, are not required that has also demonstrated efficacy in controlled studies. We believe that our technology platform and unique intellectual property assets present a high barrier to entry for others who would try to develop and sell software products for improvement of near vision sharpness and reading capabilities using hand-held devices. Corporate Information Our principal executive offices are located at GlassesOff Inc., 5 Jabotinski St. POB 12, Ramat Gan 5252006, Israel and our telephone number is (855) 393-7243. Our website address is www.glassesoff.com. Information contained on our website or that can be accessed through our website does not constitute a part of this prospectus and is not incorporated herein by reference. The Offering Common Stock offered by the selling stockholders: Up to 5,000,000 shares consisting of: Up to 4,896,699 shares that we may issue and sell to YA Global under the SEDA; and 103,301 shares that we issued to YA Global II in satisfaction of the commitment fee payable by us upon execution of the SEDA. Common Stock outstanding: 57,834,426 shares as of the date of this prospectus, including 103,301 shares previously issued to YA Global II in satisfaction of that portion of the commitment fee payable by us upon execution of the SEDA (and included in this offering) and excluding: 10,013,504 shares issuable upon the exercise of outstanding warrants; and 9,996,485 shares issuable upon the exercise of stock options. Trading market: Our Common Stock is quoted on the OTCBB under the symbol "GLSO". Use of proceeds: The selling stockholders will receive the proceeds from the sale of the shares of Common Stock offered hereby. We will not receive any proceeds from the sale of the shares of Common Stock, but will pay the expenses (other than any underwriting discounts and broker s commissions and similar expenses) of this offering. While we will not receive any proceeds from the sale of shares of Common Stock offered hereby, we may receive up to $15,000,000 of proceeds from our sales of shares of Common Stock to YA Global pursuant to the SEDA. Any proceeds that we receive from sales to the YA Global under the SEDA will be used for working capital and other general corporate purposes. See "Use of Proceeds."
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001488613_foundation_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001488613_foundation_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus or incorporated by reference into this prospectus from our Annual Report on Form 10-K for the year ended December 31, 2013 and our other filings with the Securities and Exchange Commission listed in the section of this prospectus entitled Incorporation of Documents by Reference and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including our financial statements and the related notes thereto that are incorporated by reference herein. You should also consider, among other things, the matters described under Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations, in each case appearing elsewhere in this prospectus or in our Annual Report on Form 10-K for the year ended December 31, 2013 incorporated by reference herein. Unless otherwise stated, all references to us, our, Foundation, we, the Company and similar designations refer to Foundation Medicine, Inc. and its subsidiaries. Overview We are a commercial-stage company focused on fundamentally changing the way patients with cancer are treated. We derive revenue from selling products enabled by our molecular information platform to physicians and biopharmaceutical companies. Our platform includes proprietary methods and algorithms for analyzing tumor tissue samples across all types of cancer, as well as information aggregation and concise reporting capabilities. Our products provide genomic information about each patient s individual cancer, enabling physicians to optimize treatments in clinical practice and enabling biopharmaceutical companies to develop targeted oncology therapies more effectively. We believe we have a significant first-mover advantage in providing comprehensive molecular information products on a commercial scale. Our first clinical products, FoundationOne, for solid tumors, and FoundationOne Heme, for blood-based cancers, or hematologic malignancies, including leukemia, lymphoma, and myeloma, as well as many sarcomas and pediatric cancers, are, to our knowledge, the only commercially available comprehensive molecular information products designed for use in the routine care of patients with cancer. We commenced our formal commercial launch of FoundationOne in June 2012 and launched FoundationOne Heme in December 2013. We believe a new, comprehensive approach to providing molecular information for use in clinical settings can initially address areas of significant unmet medical needs for patients suffering from advanced, or active metastatic, cancers. We estimate that there are approximately one million patients per year in the United States with newly-diagnosed or recurrent active metastatic cancers who fall into challenging treatment categories, including patients who have rare or aggressive diseases, patients whose disease has progressed after standard treatments, and patients who have tested negative under, or been ineligible for, traditional molecular diagnostic tests. We are initially targeting these patients for FoundationOne because we believe this patient population will currently benefit most from a comprehensive molecular information product. Our estimates are based upon a combination of feedback from our network of oncology thought leaders, data published by the National Cancer Institute in the Cancer Statistics Review, and focused market research that we commissioned. This market research consisted of an analysis of a third party database (that includes public and private cancer-related statistical information on tumor type, disease stage, Table of Contents The information in this preliminary prospectus is not complete and may be changed. We and the selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to completion. Dated March 20, 2014. Prospectus Shares $150,000,000 Foundation Medicine, Inc. Common Stock This is a public offering of shares of common stock of Foundation Medicine, Inc. We are offering shares and the selling stockholders identified in this prospectus are offering an additional shares to be sold in this offering. We will not receive any proceeds from the sale of shares by the selling stockholders. Our common stock is listed on The NASDAQ Global Select Market under the symbol FMI. As of March 19, 2014, the last reported sale price of our common stock on The NASDAQ Global Select Market was $40.89 per share. We are an emerging growth company under applicable Securities and Exchange Commission rules and are subject to reduced public company reporting requirements. Investing in our common stock involves a high degree of risk. See Risk Factors on page 11 to read about factors you should consider before buying shares of the common stock. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds to us, before expenses $ $ Proceeds to the selling stockholders, before expenses $ $ (1) We refer you to Underwriting beginning on page 58 for additional information regarding total underwriting compensation. We and the selling stockholders have granted the underwriters an option to purchase up to an additional and shares of common stock, respectively, at the public offering price less the underwriting discount. The underwriters expect to deliver the shares against payment in New York, New York on , 2014. Goldman, Sachs & Co. J.P. Morgan Prospectus dated on , 2014 Table of Contents clinical information, and disease outcomes) supplemented with confirmatory interviews from physicians who practice at a variety of cancer treatment centers, including academic research centers and community hospitals. As the number of available targeted therapies expands and as physicians gain further experience using comprehensive molecular information in their routine treatment decisions, we believe that the potentially addressable market for comprehensive molecular information products for solid tumors will expand over the next five years to include most patients who have metastatic disease, not limited to the challenging treatment categories noted above. We estimate that this potential market expansion could include an additional 800,000 total patients annually, based upon the same combination of sources of information we used to estimate the size of the patient population we are initially targeting for FoundationOne. Hematologic malignancies account for approximately 10% of new cancer diagnoses in the United States. In developing our commercialization strategy for FoundationOne Heme, we worked with our network of oncology thought leaders, including Memorial Sloan-Kettering Cancer Center, or MSKCC, to identify the initial subsets of patients with hematologic cancers for whom FoundationOne Heme was most likely to positively inform treatment decisions. We are initially targeting patients suffering from hematologic malignancies for whom standard treatments had been tried and failed, or refractory cases, certain forms of leukemia, including acute myeloid leukemia (AML), acute lymphoblastic leukemia (ALL), and chronic lymphocytic leukemia (CLL), as well as myelodysplastic syndromes (MDS) for FoundationOne Heme. While these groups are not mutually exclusive, we estimate that there are approximately 100,000 patients annually in the United States who suffer from these or similar cancers. For additional details on our target patient populations, including the initial populations we are targeting for FoundationOne Heme, see Business Market Opportunities for FoundationOne and FoundationOne Heme in our Annual Report on Form 10-K for the year ended December 31, 2013 incorporated by reference herein. Although we expect existing and future diagnostic testing providers to also target these patient populations, we believe FoundationOne and FoundationOne Heme are currently the only commercially available comprehensive molecular information products that provide a fully informative genomic profile in a concise and actionable format designed for use in routine clinical setting. We have experienced rapid adoption of FoundationOne. More than 2,100 physicians from large academic centers and community-based practices across more than 25 countries have ordered FoundationOne since its formal commercial launch in June 2012. We believe this rapid adoption of FoundationOne, accomplished with a nascent sales team, demonstrates the demand for and utility of a single, comprehensive product that helps oncologists effectively implement the promise of precision medicine. To further accelerate our growth and extend our competitive advantage, we are expanding our sales force, publishing scientific and medical advances, fostering relationships throughout the oncology community, and developing new products. Key thought leaders at premier cancer centers have embraced our approach, as evidenced by their routine use of FoundationOne for their patients, as well as by our collaborations on clinical studies, peer-reviewed publications, and presentations at scientific and medical conferences. We believe that this validation of our approach by key thought leaders will also help drive adoption in the community oncology setting, where 85% of the approximately 10,000 oncologists in the United States practice. We believe the increasing use of our products, especially among thought leaders, along with the demonstration of the economic and clinical value of FoundationOne and FoundationOne Heme, will also help facilitate favorable reimbursement decisions. Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+SUMMARY FINANCIAL INFORMATION
+
+ 
+
+The following financial information summarizes the more complete historical financial information at the end of this prospectus.
+
+ BALANCE SHEET
+ 
+ As of September 30, 2014 (Unaudited)
+ 
+
+ Total Assets
+ 
+ $
+ 1,497
+ 
+
+ Total Liabilities
+ 
+ $
+ 19,726
+ 
+
+ Stockholders Equity
+ 
+ $
+ (18,229
+ )
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ INCOME STATEMENT
+ 
+ 
+ 
+ 
+
+ Revenue
+ 
+ $
+ 2,920
+ 
+
+ Total Expenses
+ 
+ $
+ 28,747
+ 
+
+ Net Income (Loss)
+ 
+ $
+ (25,827
+ )
+
+ BALANCE SHEET
+ 
+ As of December 31, 2013 (Audited)
+ 
+
+ Total Assets
+ 
+ $
+ 10
+ 
+
+ Total Liabilities
+ 
+ $
+ 17,411
+ 
+
+ Stockholders Equity
+ 
+ $
+ (17,401
+ )
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ INCOME STATEMENT
+ 
+ 
+ 
+ 
+
+ Revenue
+ 
+ $
+ -
+ 
+
+ Total Expenses 
+ 
+ $
+ 16,899
+ 
+
+ Net Loss
+ 
+ $
+ (16,899
+ )
+
+ 
+
+RISK FACTORS
+
+ 
+
+An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. The price of our common stock could decline due to any of these risks, and you may lose all or part of your investment.
+
+ 
+
+3
+
+ 
+
+ 
+
+WE WILL NEED A MINIMUM OF APPROXIMATELY $450,000 TO PROCEED WITH OUR BUSINESS PLAN. IF WE ARE UNABLE TO RAISE THAT AMOUNT THROUGH TRADITIONAL FINANCING SOURCES SUCH AS LENDER, BANK AND PRIVATE PLACEMENT, WE WILL HAVE TO REVISE OUR BUSINESS PLAN OR CLOSE OUR BUSINESS.
+
+ 
+
+We currently do not have any manufactured product and we have no income. Our business plan calls for expenditures in the amount of $450,000 to get our initial product to market. If we are able to raise $450,000, we should be able to meet this objective. Even after our initial products are ready to sell, there can be no assurance they will generate sufficient revenues to sustain our business operations. The $450,000 needed for funding at the present time may not be available to us. If we are not successful in obtaining funding, we will not be able to achieve revenues and our business will likely fail.
+
+ 
+
+THE COMPANY WILL HAVE WIDE DISCRETIONARY USE OF FUNDING PROCEEDS.
+
+ 
+
+Management has broad discretion with respect to the specific application of the proceeds of any funding acquired. There can be no assurance that determinations ultimately made by the Company relating to the specific allocation of the net proceeds of such funding will permit the Company to achieve its business objectives. SEE "Proposed Business"
+
+ 
+
+WE ARE AN EMERGING GROWTH COMPANY.
+
+ 
+
+We are an "emerging growth company," and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our common stock less attractive to investors. 
+
+ 
+
+We qualify as an "emerging growth company" under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:
+
+ 
+
+ 
+ 
+ have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
+
+ 
+
+ 
+ 
+ provide an auditor attestation with respect to management's report on the effectiveness of our internal controls over financial reporting;
+
+ 
+
+ 
+ 
+ comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); 
+
+ 
+
+ 
+ 
+ submit certain executive compensation matters to shareholder advisory votes, such as "say-on-pay" and "say-on-frequency;" and
+
+ 
+
+ 
+ 
+ disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive's compensation to median employee compensation. 
+
+ 
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
+
+ 
+
+We will remain an "emerging growth company" for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. Even if we no longer qualify for the exemptions for an emerging growth company, we may still be, in certain circumstances, subject to scaled disclosure requirements as a smaller reporting company. For example, smaller reporting companies, like emerging growth companies, are not required to provide a compensation discussion and analysis under Item 402(b) of Regulation S-K or auditor attestation of internal controls over financial reporting.
+
+ 
+
+Until such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
+
+ 
+
+BECAUSE WE HAVE NOT YET COMMENCED BUSINESS OPERATIONS, WE FACE A HIGH RISK OF BUSINESS FAILURE.
+
+ 
+
+We were incorporated on December 31, 2009 and to date have been involved primarily in organizational activities. We have earned minimal revenues as of the date of this prospectus.
+
+ 
+
+Accordingly, you cannot evaluate our business, and therefore our future prospects, due to a lack of operating history. Potential investors should be aware of the difficulties normally encountered by development stage companies and the high rate of failure of such enterprises. In addition, there is no guarantee that we will be able to expand our business operations. Even if we expand our operations, at present, we do not know precisely when this will occur.
+
+ 
+
+WE HAVE ONLY GENERATED MINIMAL REVENUES AND DO NOT EXPECT TO GENERATE REVENUES UNTIL WE HAVE FUNDED THE COMPANY.
+
+ 
+
+4
+
+ 
+
+ 
+
+ 
+
+We have generated minimal revenues through our maintenance operations as of the date of this prospectus and do not expect to generate further revenues until we obtain funding. Upon completion of our commencement stage, we anticipate that we will incur increased operating expenses. We therefore expect to incur some losses into the foreseeable future. Potential investors should be aware of the difficulties we yet face in the implementation of our business plan. These risks include without limitation:
+
+ 
+ -- Completion of our manufacturing facilities; and
+
+ 
+
+ 
+ -- The acceptance of our products into the market place to a sufficient extent that our operations become economically viable.
+
+ 
+
+The likelihood of success must also be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the commencement of our business plan. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations. If
+we are unsuccessful in addressing these risks, our business will most likely fail.
+
+ 
+
+INVESTORS WILL BE UNABLE TO SELL THEIR SECURITIES IF NO MARKET DEVELOPS FOR THOSE SECURITIES.
+
+ 
+
+No market exists at the present time for our common shares. Investors in the offering will purchase securities that cannot be resold by those investors until a market exists. We intend to apply for admission to quotation of our securities on the OTC Bulletin Board . If for any reason our common stock is not quoted on the OTC Bulletin Board or a public trading market does not otherwise develop, purchasers of the shares may have difficulty selling their common stock should they desire to do so.
+
+ 
+
+BECAUSE OUR PRODUCTS ARE SPECIALTY PRODUCTS THAT WILL APPEAL TO ONLY A PORTION OF THE U.S. POPULATION, UNLESS WE CAN ACHIEVE BROAD BASED MARKETING SUCCESS IT IS LIKELY OUR CONCRETE CASTING BUSINESS WILL NOT SUCCEED.
+
+ 
+
+The type of products which we will produce are not currently as widely used in the construction of residential housing as competing materials such as wood, drywall or plaster panels. To succeed we will need to market our potential products to a wide geographic area to appeal to a wider market. If we cannot become the supplier of pre-cast cellular concrete wall, roof and interior panels to a broad base of builders and contractors, it will be difficult for us to achieve financial success and investors may lose their investments.
+
+ 
+
+WE DEPEND ON JOHN SPROVIERI, WHOM WE MAY NOT BE ABLE TO RETAIN, IN WHICH EVENT WE COULD NOT CONTINUE TO DEVELOP OUR BUSINESS PLAN.
+
+ 
+
+John Sprovieri is our only officer and our principal director who has the expertise to run and oversee the development of our business. We would not be able to retain Mr. Sprovieri if he should die, become disabled or become engaged in other business pursuits to the extent he cannot devote sufficient time to our business. In such event, we could not prosecute our business plan unless we can replace Mr. Sprovieri. It is uncertain whether we would be able to do so. In addition, we have no key-man life insurance on Mr. Sprovieri.
+
+ 
+
+THE INDUSTRY IN WHICH WE INTEND TO COMPETE IS HIGHLY CYCLICAL AND ANY DOWNTURN RESULTING IN LOWER DEMAND OR INCREASED SURPLUS WOULD HAVE A MATERIALLY ADVERSE IMPACT ON OUR FINANCIAL RESULTS.
+
+ 
+
+The building products manufacturing and distribution industry is subject to cyclical market pressures caused by a number of factors that are out of our control, such as general economic and political conditions, levels of new construction, interest rates and population growth. To the extent that cyclical market factors adversely impact overall demand for environmentally friendly building products or the prices that we can charge for our products, our net sales and margins would likely decline in the same time frame as the cyclical downturn occurs. Because much of our overhead and expense is relatively fixed in nature, a decrease in sales and margin generally could have a significant adverse impact on our results of operations. Also, to the extent our potential customers experience downturns in business; our ability to collect our receivables could be adversely affected. Finally, the unpredictable natures of the cyclical market factors that impact our industry make it difficult to forecast our operating results.
+
+ 
+
+ 5
+
+ 
+
+ 
+
+OUR SHARES OF COMMON STOCK ARE SUBJECT TO THE "PENNY STOCK" RULES OF THE SECURITIES AND EXCHANGE COMMISSION AND THE TRADING MARKET IN OUR SECURITIES WILL BE LIMITED, WHICH WILL MAKE TRANSACTIONS IN OUR STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR STOCK.
+
+ 
+
+The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks." Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. 
+
+ 
+
+In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules. If a trading market for our common stock develops, our common stock will probably become subject to the penny stock rules, and shareholders may have difficulty in selling their shares.
+
+ 
+
+ANY PRODUCT LIABILITY CLAIMS AGAINST US COULD RESULT IN ADVERSE PUBLICITY AND POTENTIALLY SIGNIFICANT MONETARY DAMAGES.
+
+ 
+
+Like other manufacturers of products that are used by consumers, we face an inherent risk of exposure to product liability claims in the event that the use of our pre-cast concrete products results in injury. In addition, since we have no operating history, we cannot predict whether or not product liability claims will be brought against us in the future, or the effect of any resulting negative publicity on our business. Moreover, we may not have adequate resources in the event of a successful claim against us. We will rely on obtaining general liability insurance to cover product liability claims. The successful assertion of product liability claims against us could result in potentially
+significant monetary damages and if our insurance protection is inadequate to cover these claims, they could require us to make significant payments.
+
+ 
+
+BECAUSE THE MARKETS IN WHICH WE COMPETE ARE HIGHLY COMPETITIVE AND MANY OF OUR COMPETITORS HAVE GREATER RESOURCES THAN US, WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY AND WE MAY BE UNABLE TO GAIN MARKET SHARE.
+
+ 
+
+We compete with a large number of competitors in the construction supply business. In addition to other companies that manufacture and distribute pre-cast aerated concrete wall, roof and interior panels, we will compete with companies that supply panels made of alternative materials such as drywall, gypsum, plaster and wood. In addition, we will compete with local, regional and national home improvement wholesalers and retailers who offer panels directly to the public. We expect to face increased competition in the future. Further, many of our potential competitors have longer operating histories, greater name recognition, access to larger customer bases and significantly greater financial, sales and marketing, manufacturing, distribution, technical and other resources than us. As a result, they may be able to respond more quickly to changing customer demands or to devote greater resources to the development, promotion and sales of their products than we can. It is possible that new competitors or alliances among existing competitors could emerge and rapidly acquire significant market share, which would harm our business. If we fail to compete successfully, our business would suffer and we may lose or be unable to gain market share.
+
+ 
+
+THE DEMAND FOR PRODUCTS REQUIRING SIGNIFICANT INITIAL CAPITAL EXPENDITURES SUCH AS OUR PRE-CAST CONCRETE PRODUCTS IS AFFECTED BY GENERAL ECONOMIC CONDITIONS.
+
+ 
+
+The United States and international economies have recently experienced a period of slow economic growth. A sustained economic recovery is uncertain. In particular, terrorist acts and similar events, continued turmoil in Asia and the Middle East or war in general could contribute to a slowdown of the market demand for products that require significant initial capital expenditures, including demand for new residential buildings.
+
+6
+
+ 
+
+ 
+
+In addition, increases in interest rates may increase financing costs to customers, which in turn may decrease demand for our products. If the economic recovery slows down as a result of the recent economic, political and social turmoil, or if there are further terrorist attacks in the United States or elsewhere, we may experience decreases in the demand for our pre-cast concrete products, which may harm our operating results.
+
+ 
+
+WE WILL RELY PRIMARILY UPON COPYRIGHT AND TRADE SECRET LAWS AND CONTRACTUAL RESTRICTIONS TO PROTECT OUR PROPRIETARY RIGHTS, AND, IF THESE RIGHTS ARE NOT SUFFICIENTLY PROTECTED, OUR ABILITY TO COMPETE AND GENERATE REVENUE COULD SUFFER.
+
+ 
+
+We will seek to protect our proprietary manufacturing processes, documentation and other written materials primarily under trade secret and copyright laws. We will also require employees and consultants with access to our proprietary information to execute confidentiality agreements. The steps taken by us to protect our proprietary information may not be adequate to prevent misappropriation of our technology. In addition, our proprietary rights may not be adequately protected because:
+
+ 
+
+ 
+ 
+ People may not be deterred from misappropriating our technologies despite the existence of laws or contracts prohibiting it;
+
+ 
+
+ 
+ 
+ Policing unauthorized use of our intellectual property may be difficult, expensive and time-consuming, and we may be unable to determine the extent of any unauthorized use; and
+
+ 
+
+ 
+ 
+ Reverse engineering, unauthorized copying, or other misappropriation of our proprietary technologies could enable third parties to benefit from our technologies without paying us for doing so. Any inability to adequately protect our proprietary rights could harm our ability to compete, to generate revenue and to grow our business.
+
+ 
+
+WE MAY NOT BE ABLE TO MANAGE OUR FUTURE GROWTH EFFECTIVELY.
+
+ 
+
+We may be unable to manage future growth. To successfully
+manage our growth and handle the responsibilities of being a public company, we believe we must effectively:
+
+ 
+
+ 
+ 
+ Hire, train, integrate and manage additional qualified engineers for research and development activities, sales and marketing personnel, and financial and information technology personnel;
+
+ 
+
+ 
+ 
+ Retain key management and augment our management team, particularly if we lose key members;
+
+ 
+
+ 
+ 
+ Continue to enhance our customer resource management and manufacturing management systems;
+
+ 
+
+ 
+ 
+ Implement and improve additional and existing administrative, financial and operations systems, procedures and controls;
+
+ 
+
+ 
+ 
+ Expand and upgrade our technological capabilities; and
+
+ 
+
+ 
+ 
+ Manage multiple relationships with our customers, suppliers and other third parties.
+
+ 
+
+We may encounter difficulties in effectively managing the budgeting, forecasting and other process control issues presented by rapid growth. If we are unable to manage our growth effectively, we may not be able to take advantage of market opportunities, satisfy customer requirements, execute our business plan or respond to competitive pressures.
+
+ 
+
+THE SUCCESS OF OUR BUSINESS WILL DEPEND ON THE CONTINUING CONTRIBUTIONS OF OUR KEY PERSONNEL.
+
+ 
+
+We will rely heavily on the services of key executive officer and directors including, John Sprovieri, our Chief Executive Officer and Director, Clifford Jett, our Director,
+and William Beers, our Director. The loss of services of our executive officer or any director could adversely impact our operations. We believe our future success will depend upon our ability to retain these key individuals and our ability to attract and retain
+other skilled managerial, engineering and sales and marketing personnel. However, we cannot guarantee that any employee will remain employed at the Company for any definite period of time.
+
+ 
+
+OUR MANAGEMENT WILL HAVE BROAD DISCRETION IN USING THE PROCEEDS OF ANY FUNDING, AND YOU WILL NOT HAVE THE OPPORTUNITY, AS PART OF YOUR INVESTMENT DECISION, TO ASSESS WHETHER THE PROCEEDS ARE BEING USED APPROPRIATELY.
+
+ 
+
+We intend to use the proceeds of any acquired funding for general corporate purposes, including working capital and capital expenditures. Depending on future developments and circumstances, we may use some of the proceeds for other purposes. The actual amounts and timing of these expenditures will vary significantly depending on a number of factors, including the amount of cash used in or generated by our operations and the market response to the introduction of our product offerings.
+
+ 
+
+7
+
+ 
+
+ 
+
+ 
+
+WE INCUR SUBSTANTIAL COMPLIANCE COSTS AS A PUBLIC COMPANY.
+
+ 
+
+As a public company, we will incur significant legal, accounting and other expenses. In addition, the Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC has required changes in corporate governance practices of public companies.
+
+ 
+
+ANY ADDITIONAL FUNDING WE ARRANGE THROUGH THE SALE OF OUR COMMON STOCK WILL RESULT IN DILUTION TO EXISTING SHAREHOLDERS.
+
+ 
+
+We may raise additional capital in order for our business plan to succeed. Our most likely source of additional capital will be through the sale of additional shares of common
+stock. Such stock issuances will cause stockholders' interests in our company to be diluted. Such dilution will negatively affect the value of investors' shares.
+
+ 
+
+WE DO NOT EXPECT TO PAY DIVIDENDS IN THE FORESEEABLE FUTURE.
+
+ 
+
+We do not expect to pay cash dividends on our common stock at any time in the foreseeable future. The future payment of dividends directly depends upon our future earnings, capital requirements, financial requirements and other factors that our board of directors will consider. Since we do not anticipate paying cash dividends on our common stock, a return on your investment, if any, will depend solely on an increase, if any, in the market value of our common stock.
+
+ 
+
+WE HAVE NO EXPERIENCE AS A PUBLIC COMPANY.
+
+ 
+
+We have never operated as a public company. We have no experience in complying with the various rules and regulations, which are required of a public company. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required of a public company. However, if we cannot operate successfully as a public company, your investment may be adversely affected. Our inability to operate as a public company could be the basis of your losing your entire investment in us.
+
+ 
+
+FORWARD-LOOKING STATEMENTS
+
+ 
+
+This discussion contains certain statements, which may be viewed as forward-looking statements that involve risks and uncertainties. When used herein, the words "believes", "anticipates", "expects" and similar expressions are intended in certain circumstances, to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected, including the risks of a startup company becoming profitable and raising the funds required to do so. Given these uncertainties, you are cautioned not to place undue reliance on such statements. There are no assurances the company can fulfill such forward-looking statements. Such forward-looking statements are only predictions; actual events or results may differ materially as a result of risks facing the company. Some of these risks include changes in government regulations, lack of financing and undercapitalization, inability to compete on a price level with competitors, loss of supply contracts, and increases in shipping costs
+
+USE OF PROCEEDS
+
+No proceeds from this offering are available to the company. The company will pursue funding through traditional means such as Lenders and other Financial Institutions and Private Placement exempt from registration.
+
+DETERMINATION OF OFFERING PRICE
+
+We determined this offering price arbitrarily by adding a $0.01 premium to the initial sale price of our common stock to investors.
+
+DILUTION
+
+The Shareholders Stock is already issued and the sale of these shares will not change the dilution of the company's stock. 
+
+8
+
+ 
+
+ 
+
+SELLING SHAREHOLDERS
+
+ 
+
+The following section presents information regarding the Selling Shareholders. The Selling Shareholders table and the accompanying notes describe the Selling Shareholders and the number of shares of our common stock being offered. A description of how the Selling Shareholders acquired the shares of common stock being sold in this offering is detailed in the table forming part of the footnotes below.
+
+We are registering 585,000 shares of our common stock owned by and on behalf of the Selling Shareholders named in the table below. We will pay all costs, expenses and fees related to the registration of these shares, including all registration and filing fees, printing expenses, legal fees and other associated costs, if any. 
+
+We will not be offering any shares on behalf of the Selling Shareholders. These Selling Shareholders are not required to sell their shares, nor have they indicated to us, as of the date of this prospectus, an intention to sell any of their shares being registered. The Selling Shareholders are offering their shares of our common stock for their own account. We will not receive any proceeds from the sale of the Selling Shareholders' shares. 
+
+ The following table provides as of the date of this prospectus, information regarding the beneficial ownership of our common stock held by the Selling Shareholders, including: 
+
+ The number of shares of our common stock owned prior to this offering,
+
+ The total number of shares of our common stock that is being offered through this prospectus; and
+
+ The total percentage of shares of our common stock owned by the Selling Shareholders following completion of the offering.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ SHAREHOLDER
+ Number of Shares Beneficially Owned Prior to the Offering (1)
+ Number of Shares Being Offered
+ Percentage owned following completion of offering
+
+ 1
+ 
+ 
+ Clifford D. Jett (2)(5)
+ 3,000,000
+ 25,000
+ 14.8%
+
+ 2
+ 
+ 
+ John Sprovieri (3)
+ 9,750,000
+ 25,000
+ 48.5%
+
+ 3
+ 
+ 
+ William Beers (4)
+ 3,000,000
+ 25,000
+ 14.8%
+
+ 4
+ 
+ 
+ Lynn Komar
+ 250,000
+ 25,000
+1.1%
+
+ 5
+ 
+ 
+ Kathleen D. Jett (2)(5)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 6
+ 
+ 
+ Mary E Sprovieri (3)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 7
+ 
+ 
+ Linda Beers (4)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 8
+ 
+ 
+ Robert Tanner
+ 25,000
+ 25,000
+ Less than 1%
+
+ 9
+ 
+ 
+ Marjorie E. Yarnell
+ 10,000
+ 10,000
+ Less than 1%
+
+ 10
+ 
+ 
+ Sharon R. Nolan
+ 10,000
+ 10,000
+ Less than 1%
+
+ 11
+ 
+ 
+ Julie Jett Regnell (5)
+ 30,000
+ 25,000
+ Less than 1%
+
+ 12
+ 
+ 
+ Ryan R. Regnell (5)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 13
+ 
+ 
+ Roderick R. Regnell (5)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 14
+ 
+ 
+ Larry Barngrover
+ 10,000
+ 10,000
+ Less than 1%
+
+ 15
+ 
+ 
+ Ryan P. Sharp
+ 10,000
+ 10,000
+ Less than 1%
+
+ 16
+ 
+ 
+ Daniel J. Hall (6)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 17
+ 
+ 
+ George R. Jett (2)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 18
+ 
+ 
+ Kelly Louise Means
+ 10,000
+ 10,000
+ Less than 1%
+
+ 19
+ 
+ 
+ Jaime Scott McLaughlin
+ 10,000
+ 10,000
+ Less than 1%
+
+ 20
+ 
+ 
+ Linda Randle
+ 10,000
+ 10,000
+ Less than 1%
+
+ 21
+ 
+ 
+ Jimmy Nelson
+ 10,000
+ 10,000
+ Less than 1%
+
+ 22
+ 
+ 
+ Michael Nilson
+ 10,000
+ 10,000
+ Less than 1%
+
+ 23
+ 
+ 
+ Doug Bill
+ 10,000
+ 10,000
+ Less than 1%
+
+ 24
+ 
+ 
+ Kimberly A. Grimm
+ 2,010,000
+ 10,000
+ 10.0%
+
+ 25
+ 
+ 
+ Cory L. Bernard
+ 10,000
+ 10,000
+ Less than 1%
+
+ 26
+ 
+ 
+ Kenneth A. Jett (2)
+ 10,000
+ 10,000
+ Less than 1%
+
+ 27
+ 
+ 
+ Rebecca Jones
+ 10,000
+ 10,000
+ Less than 1%
+
+ 28
+ 
+ 
+ Karen A. Johnson
+ 10,000
+ 10,000
+ Less than 1%
+
+ 29
+ 
+ 
+ Jennifer Bain
+ 10,000
+ 10,000
+ Less than 1%
+
+ 30
+ 
+ 
+ Elizabeth A Voiles
+ 10,000
+ 10,000
+ Less than 1%
+
+ 31
+ 
+ 
+ Jose M. Guzman
+ 10,000
+ 10,000
+ Less than 1%
+
+ 32
+ 
+ 
+ Christopher Longphre
+ 10,000
+ 10,000
+ Less than 1%
+
+ 33
+ 
+ 
+ Donald Hilderbrand
+ 10,000
+ 10,000
+ Less than 1%
+
+ 34
+ 
+ 
+ Martin J Kelly
+ 510,000
+ 10,000
+ 2.5%
+
+ 35
+ 
+ 
+ John Schmidt
+ 10,000
+ 10,000
+ Less than 1%
+
+ 36
+ 
+ 
+ Joe Hobbs
+ 25,000
+ 25,000
+ Less than 1%
+
+ 37
+ 
+ 
+ Billy Sullivan
+ 25,000
+ 25,000
+ Less than 1%
+
+ 38
+ 
+ 
+ Linda Buchanan
+ 10,000
+ 10,000
+ Less than 1%
+
+ 39
+ 
+ 
+ Dan Newbold
+ 25,000
+ 25,000
+ Less than 1%
+
+ 40
+ 
+ 
+ Lee Hall (6)
+ 25,000
+ 25,000
+ Less than 1%
+
+ 41
+ 
+ 
+ Steven A. Weber
+ 10,000
+ 10,000
+ Less than 1%
+
+ 42
+ 
+ 
+ VAWT Earth Wind and Power (7)
+ 970,000
+ 25,000
+ 4.7%
+
+ 43
+ 
+ 
+ Colonial Stock Transfer Co.
+ 100,000
+ -
+ Less than 1%
+
+ 
+ 
+ 
+ 
+ 20,035,000
+ 585,000
+
+ 
+
+9
+
+ 
+
+ 
+
+FOOTNOTES
+
+(1) Based upon beneficial ownership information reported to us as of September 30, 2014
+
+(2) Kathleen D. Jett is the wife of our director Clifford D. Jett. George R. Jett and Kenneth A. Jett are the brothers of our director Clifford D. Jett.
+
+(3) Mary E Sprovieri is the wife of our officer and director John Sprovieri.
+
+(4) Linda Beers is the wife of our director William Beers.
+
+(5) Julie Jett Regnell is the daughter of, Clifford D. and Kathleen D Jett and is the wife of Ryan R. Regnall and mother of Roderick R. Regnell.
+
+(6) Daniel J. Hall and Lee Hall are not related.
+
+(7) Rick Plotnikoff is the sole principal of VAWT Earth Wind and Power and consequently, the person with sole voting and investment control. VAWT Earth Wind and Power is a consulting firm providing "going public" consulting services to Auscrete Corporation in return for 970,000 shares of Auscrete's common stock.
+
+The table on the following page summarizes shares that were initially issued pursuant to Section 4(2) of the Securities Act of 1933 (the "Securities Act") at various dates corresponding with each purchaser. In connection with this issuance, the purchasers were provided with access to all material aspects of the company, including the business, management, offering details, risk factors and financial statements. Each investor also represented to us that he/she was acquiring the shares as principal for his/her own account with investment intent. Each investor also represented that he/she was sophisticated, having prior investment experience and having adequate and reasonable opportunity and access to any corporate information necessary to make an informed decision. This issuance of securities was not accompanied by general advertisement or general solicitation. The shares were issued with a Rule 144 restrictive legend.
+
+ 
+
+TABLE FOLLOWS ON NEXT PAGE
+
+10
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ NAME
+ ADDRESS
+ 
+ Type of
+
+ Consideration
+
+ 
+ Value of
+
+ Services
+
+ Value of Cash
+ Date
+ 
+ No. of
+
+ Shares
+
+ 1
+ 
+ 
+ Clifford D. Jett
+ PO Box 846, Rufus, OR 97050
+ Services
+ $60,000.00
+ 
+ 1/12/2010
+ 3,000,000
+
+ 2
+ 
+ 
+ John Sprovieri
+ PO Box 813, Rufus OR 97050
+ Services
+ $60,000.00
+ 
+ 1/12/2010
+ 3,000,000
+
+ 2
+ 
+ 
+ John Sprovieri
+ PO Box 813, Rufus OR 97050
+ Assets
+ $135,000.00
+ 
+ 12/01/2011
+ 6,750,000
+
+ 3
+ 
+ 
+ William Beers
+ PO Box 825, Rufus OR 97050
+ Services
+ $60,000.00
+ 
+ 1/12/2010
+ 3,000,000
+
+ 4
+ 
+ 
+ Lynn Komar
+ 61560 Sunny Breeze Lane, Bend OR 97702
+ Services
+ $5,000.00
+ 
+ 1/12/2010
+ 250,000
+
+ 5
+ 
+ 
+ Kathleen D. Jett
+ PO Box 846, Rufus, OR 97050
+ Cash
+ 
+ $200.00
+ 1/21/2010
+ 10,000
+
+ 6
+ 
+ 
+ Mary E Sprovieri
+ PO Box 813 Rufus OR 97050
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 7
+ 
+ 
+ Linda Beers
+ PO Box 825, Rufus OR 97050
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 8
+ 
+ 
+ Robert Tanner
+ PO Box 54, Grass Valley OR 97029
+ Cash
+ 
+ $500.00
+ 1/12/2010
+ 25,000
+
+ 9
+ 
+ 
+ Marjorie E. Yarnell
+ PO Box 6, Rufus OR 97050
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 10
+ 
+ 
+ Sharon R. Nolan
+ PO Box 745, Rufus OR 97050
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 11
+ 
+ 
+ Julie Jett Regnell
+ 1126 Olmo Way, Boulder City NV 89005
+ Cash
+ 
+ $600.00
+ 1/12/2010
+ 30,000
+
+ 12
+ 
+ 
+ Ryan R. Regnell
+ 1126 Olmo Way, Boulder City NV 89005
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 13
+ 
+ 
+ Roderick R. Regnell
+ 1126 Olmo Way, Boulder City, NV 89005
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 14
+ 
+ 
+ Larry Barngrover
+ 428 S. Lawndale Dr., Spring Creek, NV 89815
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 15
+ 
+ 
+ Ryan P. Sharp
+ PO Box 351, Pendleton, OR 97801-0351
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 16
+ 
+ 
+ Daniel J. Hall
+ PO Box 292,Wasco, OR 97065
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 17
+ 
+ 
+ George R. Jett
+ PO Box 826, Rufus, OR 97050
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 18
+ 
+ 
+ Kelly Louise Means
+ PO Box 12053, Reno, NV 89510
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 19
+ 
+ 
+ Jaime Scott McLaughlin
+ PO Box 12053, Reno, NV 89510
+ Cash
+ 
+ $200.00
+ 1/12/2010
+ 10,000
+
+ 20
+ 
+ 
+ Linda Randle
+ 6060 Oak St., Anderson, CA 96007
+ Cash
+ 
+ $200.00
+ 1/20/2010
+ 10,000
+
+ 21
+ 
+ 
+ Jimmy Nelson
+ 353 Centerville Hwy., Lyle, WA 98635
+ Cash
+ 
+ $200.00
+ 1/20/2010
+ 10,000
+
+ 22
+ 
+ 
+ Michael Nilson
+ PO Box 518, Lyle, WA 98635
+ Cash
+ 
+ $200.00
+ 1/20/2010
+ 10,000
+
+ 23
+ 
+ 
+ Doug Bill
+ 101 Jayden Lane Stevenson WA 98648
+ Cash
+ 
+ $200.00
+ 1/20/2010
+ 10,000
+
+ 24
+ 
+ 
+ Kimberly A. Grimm
+ PO Box 801, Rufus, OR 97050
+ Cash
+ 
+ $200.00
+ 1/21/2010
+ 10,000
+
+ 25
+ 
+ 
+ Cory L. Bernard
+ 704 Oak Ave., Hood River, OR 97031
+ Cash
+ 
+ $200.00
+ 1/21/2010
+ 10,000
+
+ 26
+ 
+ 
+ Kenneth A. Jett
+ PO Box 846, Rufus, OR 97050
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 27
+ 
+ 
+ Rebecca Jones
+ 72233 Blalock Cyn. Rd. Arlington,OR 97812
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 28
+ 
+ 
+ Karen A. Johnson
+ 300 Circulo Uno Poco, Rohnert Park, CA
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 29
+ 
+ 
+ Jennifer Bain
+ 4804 Gettysburg Rd.,Knoxville, TN 37921
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 30
+ 
+ 
+ Elizabeth A Voiles
+ 6200 Hickson Pike, #202, Hickson TN 37343
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 31
+ 
+ 
+ Jose M. Guzman
+ PO Box 703, Rufus, OR 97050
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 32
+ 
+ 
+ Christopher Longphre
+ PO Box 631, Stevenson, WA 98648
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 33
+ 
+ 
+ Donald Hilderbrand
+ PO Box 148, Wasco OR 97065
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 34
+ 
+ 
+ Martin J Kelly
+ PO Box 813 Rufus OR 97050
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 35
+ 
+ 
+ John Schmidt
+ PO Box 1934 Sandy OR 97055
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 36
+ 
+ 
+ Joe Hobbs
+ 210 Webber Street, The Dalles OR 97058
+ Cash
+ 
+ $500.00
+ 2/4/2010
+ 25,000
+
+ 37
+ 
+ 
+ Billy Sullivan
+ PO Box 614, Hood River OR 97031
+ Cash
+ 
+ $500.00
+ 2/4/2010
+ 25,000
+
+ 38
+ 
+ 
+ Linda Buchanan
+ PO Box 825 Rufus OR 97050
+ Cash
+ 
+ $200.00
+ 2/4/2010
+ 10,000
+
+ 39
+ 
+ 
+ Dan Newbold
+ 30303 Maple Drive, Junction City, OR 97448
+ Cash
+ 
+ $500.00
+ 2/4/2010
+ 25,000
+
+ 40
+ 
+ 
+ Lee Hall
+ 30325 Maple Dr. Junction City, OR. 97448
+ Cash
+ 
+ $500.00
+ 2/4/2010
+ 25,000
+
+ 41
+ 
+ 
+ Steven A. Weber
+ 1950 Maple Ave. NE Salem OR 97301
+ Cash
+ 
+ $200.00
+ 2/28/2010
+ 10,000
+
+ 42
+ 
+ 
+ VAWT Earth Wind and Power
+ Unit 2393 Sidney, B.C. V8L 3Y3
+ Services
+ $19,400
+ 
+ 1/15/2010
+ 970,000
+
+ 43
+ 
+ 
+ Colonial Stock Transfer Co.
+ 66 Exchange Place, Salt Lake City, UT 84111
+ Services
+ $3,000
+ 
+ 9/5/2013
+ 100,000
+
+ 45
+ 
+ 
+ Martin J Kelly
+ PO Box 813, Rufus OR 97050
+ Cash
+ 
+ $5,000.00
+ 5/28/2014
+ 500,000
+
+ 
+ 
+ 
+ 
+ 
+ TOTALS
+ $362,400.00
+ $14,300.00
+ 
+ 20,035,000
+
+PLAN OF DISTRIBUTION
+
+SHARES OFFERED BY THE SELLING SHAREHOLDERS
+
+ 
+
+The Selling Shareholders may sell some of all their shares of our common stock in one or more transaction, including block transactions. There are no arrangements, agreements, or understandings with respect to the sale of these securities. The Selling Shareholders will sell their shares of our common stock at a fixed price of $0.03 per share until our shares of common stock are quoted on the OTC Bulletin Board, and thereafter may be offered at prevailing market prices or privately negotiated prices.
+
+ 
+
+11
+
+ 
+
+ 
+
+The Selling Shareholders may distribute their shares of our common stock to one or more of its officers, directors, or shareholders who are unaffiliated with us. Such new shareholders may, in turn, distribute such shares of our common stock as described above. If these shares being registered for resale are transferred from the named Selling Shareholders and the new shareholders wish to rely on the prospectus to resell these shares, then we must file a prospectus supplement naming them as Selling Shareholders and provide the information required concerning the identity of each new Selling Shareholder and their relationship, if any, with us. As of the date of this prospectus there is no agreement or understanding between the Selling Shareholders and its officers, directors, or shareholders with respect to the distribution of the shares of our common stock being registered for resale pursuant to this registration statement. 
+
+ 
+
+We can provide no assurance that any or all of the shares of our common stock offered by the Selling Shareholders will be sold.
+
+ 
+
+We will pay all costs, expenses, and fees related to the registration of our shares of common stock owned by the Selling Shareholders. The Selling Shareholders, however, will pay any commissions or other fees payable to broker-dealers in connection with any sale of its shares of our common stock.
+
+ 
+
+The Selling Shareholders shall be deemed to be engaged in a distribution of our common stock in connection with the resale of their shares and therefore must comply with applicable securities laws, among other things;
+
+ 
+
+ Not engage in any market stabilization activities in connection with our common stock, should a market ever develop;
+
+ 
+
+ Furnish each broker-dealer through which our common stock may be offered copies of this prospectus, along with any supplements or amendments, as may be required by such broker-dealer; and
+
+ 
+
+ Not bid for or purchase any of our shares of common stock or attempt to induce any person to purchase any of our shares of common stock other than as permitted under the Exchange Act.
+
+ 
+
+We have advised the Selling Shareholders that if a particular offer of our shares of common stock to be made on terms constituting a material change from the information described in this "Plan of Distribution" section of the prospectus, then, to the extent required, a prospectus supplement must be distributed setting forth such terms and related information as required.
+
+ 
+
+In addition, we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the Selling Shareholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act, if applicable
+
+ 
+
+DESCRIPTION OF SECURITIES
+
+ 
+
+General
+
+ 
+
+Our authorized capital stock consists of 500,000,000 shares of common stock at no par value per share.
+
+ 
+
+Common Stock
+
+ 
+
+As of September 30, 2014, there were 20,035,000 shares of our common stock issued and outstanding held by 43 stockholders of record.
+
+ 
+
+Holders of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of common stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of common stock voting for the election of directors can elect all of the directors. Holders of our common stock representing a majority of the voting power of our capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our articles of incorporation.
+
+ 
+
+Holders of common stock are entitled to share in all dividends that the board of directors, in its discretion, declares from legally available funds. In the event of liquidation,
+dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock. Holders of our common
+stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock.
+
+ 
+
+Preferred Stock
+
+ 
+
+We do not have an authorized class of preferred stock.
+
+ 
+
+Dividend Policy
+
+ 
+
+We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.
+
+12
+
+ 
+
+ 
+
+ 
+
+Share Purchase Warrants
+
+ 
+
+We have not issued and do not have any outstanding warrants to purchase shares of our common stock.
+
+ 
+
+Options
+
+ 
+
+We have not issued and do not have any outstanding options to purchase shares of our common stock.
+
+ 
+
+Convertible Securities
+
+ 
+
+We have not issued and do not have any outstanding securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock.
+
+ 
+
+INTERESTS OF NAMED EXPERTS AND COUNSEL
+
+ 
+
+No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, an interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.
+
+ 
+
+Matthew T Welker, Attorney at Law, with an address of PO Box 199, Clear Spring, MD 21722, has provided an opinion on the validity of our common stock. See Exhibit 5.1.
+
+ 
+
+The financial statements included in this prospectus and the registration statement have been audited by MartinelliMick, PLLC for the years ending 12/31/2013 and 12/31/2012 and their report appears elsewhere in this registration statement filed with the SEC, and is included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting. See Exhibit 23.1
+
+ 
+
+DESCRIPTION OF BUSINESS
+
+ 
+
+Company Overview
+
+ 
+
+Auscrete Corporation was incorporated in the State of Wyoming on December 31, 2009 and is a development stage company that has not commenced operations but will commence operations when minimum financing is obtained. The manufacturing technology placed into Auscrete Corporation has been granted by Mr. Sprovieri. This technology is the culmination of development work and building construction carried out by Mr. Sprovieri in his previous private company that commenced early in 2003, also called Auscrete Corporation. That private company will be totally closed down once the public Auscrete Corporation is adequately funded and commenced.
+
+ 
+
+Initially, Auscrete plans to manufacture lightweight cellular concrete wall, roof and interior panels for use in the construction of affordable residential housing using technology previously developed by the founder. The principal business will be to supply builders and contractors with pre-cast wall, roof and interior panels for use in the construction of single-family homes and commercial structures.
+
+ 
+
+Although Auscrete has not begun operations, our CEO and our sole founder has contributed certain assets and equipment owned by another company owned and run by Mr. Sprovieri. The name of that company is also Auscrete Corporation organized under the laws of the State of Oregon ("Auscrete of Oregon"). Mr. Sprovieri contributed these assets in return for 675,000 shares of common stock. The number of shares of common stock issued to Mr. Sprovieri in exchange for the assets were determined to be the fair value of the assets contributed. These assets are functional and will be the foundation upon which Auscrete will build its broader manufacturing capabilities.
+
+ 
+
+Auscrete s products will be fabricated on a build to order basis and as such, variable costs will be incurred before the company receives any revenue. These variable costs differ based on the product constructed. Further detail on first year and second year expansion expenditures is listed on page 20. Although the second year expenditures will not be required at the commencement of operations, the purpose of the year two expenditures will be to enhance the manufacturing facilities and process in order to improve efficiency and reduce production costs.
+
+ 
+
+At this juncture, Auscrete is a development stage company and has not earned any manufacturing revenue. The plan of operation is forward-looking and there is no assurance that operations will ever begin.
+
+ 
+
+Operations will begin following the raising of the required funds to do so. It is estimated that $450,000 (Four Hundred Fifty Thousand Dollars) ("Initial Capital Outlay") will be required at a minimum to begin operations and to continue operations at a stage 1 (pilot plant) level.
+
+ 
+
+ 13
+
+ 
+
+ 
+
+Founder s Development Activities to
+Date
+
+ 
+
+Auscrete s CEO and founder, John Sprovieri, possesses certain proprietary technology in cellular lightweight concrete manufacturing. He has applied his engineering and marketing expertise to develop and promote products under the product name, Auscrete Cellular Concrete ("ACC"). ACC is the culmination of the refinements made to a technology developed in Australia in the mid 1980 s. The Australian product "Cellucon" (the company that manufactured it is now defunct) has been used in many parts of the world, and Mr. Sprovieri has introduced it to the US. The process enables infusion of millions of tiny air bubbles into a special inert concrete mix enabling the creation of a lightweight product without sacrificing strength or structural integrity.
+
+ 
+
+Since commencing re-development of the basic technology ten years ago, Mr. Sprovieri has refined and modified the basic ACC formula utilizing various bubble producing machines to produce the product currently usable in building construction.
+
+ 
+
+ 
+ At Auscrete of Oregon, a number of specialized machines have been fabricated for the manufacturing of ACC including machinery that can produce various sized bubbles, hydraulically operated casting beds, concrete batching plant, materials handling equipment, specialized finishing machines and a "Hot Box" materials thermal testing cabinet that gives thermal "R" ratings of materials to ASTM specifications. Additionally, many sample panels have been produced for testing and for the construction of structures.
+
+ Putting the ACC technology to practical use, Mr. Sprovieri first produced a multi user rest room facility for the city park in Wasco, Oregon three years ago. The construction of the restroom facility provided valuable feedback which helped Mr. Sprovieri refine the manufacturing and construction process. The follow-up project to the restroom facility involved the construction of a 2,500 sq. ft. prototype house (pictured to the right) on land in Rufus, Oregon.
+ 
+
+ 
+
+Contributed Assets
+
+ 
+
+The following assets were contributed by Mr. Sprovieri and are functional at our manufacturing facility.
+
+ 
+
+The contributed assets were impaired in the year ending December 31, 2012. Long-lived assets were evaluated for impairment as ongoing events and changes in circumstances (such as probability of financing failure or significant adverse change to market conditions) can impact their net book value which may not be recoverable. As a result of this evaluation, an asset impairment change, which resulted in the reduction of the carrying amount of certain equipment, vehicles and property of $130,933 in 2012 and $0 in 2013. 
+
+ 
+
+ 
+
+Contributed Assets
+
+ 
+
+ Description
+
+ 
+
+ 
+ Concrete Batch Plant
+
+ 
+ 9,000 sq. ft. Building. Complete New (not erected) Industrial Clear Span Building
+
+ 
+ 15,000# Capacity Nissan Forklift
+
+ 6,000# Capacity Toyota Forklift
+
+ Yanmar Tractor/Front End Loader
+
+ Volvo Semi-Road Tractor
+
+ 20 Flat Deck Trailer
+
+ Ford F250 Diesel Pickup
+
+ 
+
+Manufactured Specialized Equipment
+
+ 
+
+ 
+ 
+
+ Following financing, the Corporation will purchase the following Manufacturing Equipment from the Oregon Auscrete Corporation:
+
+ 
+
+ 
+ 2 Hydraulically Operated Wall Panel Molding Tables
+
+ 
+ 4 Regular 20 Roof Panel Molding Tables
+
+ 
+ 1 Mobile Concrete Transporter
+
+ Thermal Testing Machine Known as a "Hot Box"
+
+ 2 Crane Attachments
+
+ Concrete Panel Storage Racks
+
+ Sand Bunker
+
+ Mold Boards, Manual & Magnetic Clamps, Brackets
+
+ 
+
+14
+
+ 
+
+ 
+
+ 
+ The current pilot plant facility is a decommissioned service station being provided by the city. The outer driveway and back areas serve as the foundation for the two major casting beds and four smaller roof panel casting beds. Space is restricted. The concrete batching plant, with its 35-ton capacity cement silo is against the end wall of the driveway and the hopper is behind the sand storage pit. The office is the service station office and the mechanical workshop serves as the fabrication area for the manufacture of rebar cage frames. Any other work is done out in the open areas. Storage of completed panels, some as large a 16 x 8 , is in industrial racks that have been built at the other end of the driveway area. To complete a 1,500 sq. ft. house, storage for as many as 30 wall panels and 25 roof panels would be needed. The plant is able to produce up to 6 wall panels per week from the large casting beds, based on the capacity of the current equipment.
+ 
+ 
+
+ 
+
+ 
+
+Our Product
+
+The corporation s projected initial products will include homes and small commercial structures built of cellular concrete. Auscrete s potential ability to create a
+light weight product that remains strong will enable production of affordable wall, roof and interior panels for the construction of these structures
+
+ 
+
+Non moving air is the best insulator and the basic materials for the Auscrete product are cement, sand, water and a proprietary inert chemical that will support the creation and longevity of very small air bubbles. The cement is standard Portland cement readily available from many suppliers. Sand and water are also available adjacent to the plant. The chemical has previously been imported from Australia but will be manufactured by a chemical company in the US upon the commencement of operations. A chemical manufacturer has yet to be identified to manufacture the chemical and as such, there are no current agreements in place for such production.
+
+ 
+
+The Auscrete product will be considered "Green" in today s evolving need for energy efficiency. Cellular concrete is perceived to be "Green", in part because of the minimal impact on the environment and its energy efficiency. The aim is to have a structure that uses minimum possible power consumption for environmental control. Auscrete s cellular structures are projected to provide very high efficiency in insulation values and, as such, have very low power input and cost.
+
+ 
+
+Additionally, cement is an abundant material and, although it does use resources, its use is considered "Ggreen" when compared to products that use wood or oil based plasticized products. Sand is available readily and aged concrete can be ground and reused as aggregate. Non potable water can be used in concrete construction.
+
+ 
+
+Energy tests on the ACC product have been carried out by an independent engineering firm and were done to the ASTM C1363-05 standard. Various weights per cubic foot are used for panels in differing areas. In general, external walls have an R rating of R22.3 and roof panels have an R rating of R32.7. This gives a whole house rating well in excess of the "whole house" Code requirement of R15.
+
+ 
+
+Auscrete s products will enable the construction of homes that are extremely thermally efficient in all conditions, strong in earthquake zones, will not burn,
+have excellent sound proofing and be impervious to pests, rot and mold. This technology is ideal for the construction of homes in the 1,000 – 4,000 sq. ft. range.
+
+ 
+
+To provide homes at low cost, it will be necessary to produce the materials on a "mass production" basis. That is why the company s plan will incorporate the methodologies of large manufacturing companies in order to provide products for the construction of, initially 30, then 150 affordable ($70k –$240k) high quality site built homes a year using Auscrete s casting technique.
+
+ 
+
+Technology
+
+ 
+
+The foaming process used to produce the aerated concrete that will be the basis of our products has its origins in a technology developed in the early 1980's in Australia. 
+
+15
+
+ 
+
+ 
+
+At that time, Romarada Chemicals of Victoria, Australia first produced a chemical mixture called Cellucon that had the ability to maintain its structural and tensile integrity during infusion of minute air bubbles, thus creating a much lighter concrete product, even when under mixing and blending stresses. Mr. Sprovieri s association with Cellucon goes back to 1992 and he was involved in assisting the development of not only the Cellucon product, but also the marketing of the product internationally.
+The Cellucon chemical company closed operations in 2003 due to the death of the founder and owner. Mr. Sprovieri brought with him to the United States, his knowledge of the Cellucon production process, which he has since refined and enhanced in the production of a similar aerated concrete product through his company, Auscrete of Oregon.
+
+ 
+
+As mentioned above, the Cellucon process has been further refined here in the US over the last 10 years by Auscrete s founder. In particular, through experimentation the founder has been able to determine the optimal balance between the size of the bubbles and the strength of the concrete. Auscrete s founder has developed specialty bubble producing machinery that can very effectively control the bubble size as required for particular applications. As discussed above, the founder has previously used this process to successfully construct a large prototype house and rest room facility.
+
+ 
+
+Auscrete s proprietary method for producing the aerated concrete involves the mixing of cement, sand and water and the specially developed air charged foaming agent that is infused during manufacturing. This enables the product to contain millions of strong, tiny air bubble , ' ': aggregates evenly distributed throughout the lightweight cast panel sections. With the addition of air, there is room for expansion and contraction, allowing for a concrete product that is both durable and flexible.
+
+ 
+
+With previous construction of prototype structures, our concrete casting experience has determined that a big advantage of Auscrete s technology is its ability to be produced as large panels at very low cost in a casting factory atmosphere with controlled simple casting techniques that ensures absolute quality control.
+
+ 
+
+Housing Construction
+
+ 
+
+Concrete is generally accepted as a standard basic building material. There appears to be little resistance to the use of concrete in home construction, particularly in the
+initial targeted sales areas of the Western United States.
+
+ 
+
+Notwithstanding the economical and ecological advantages of our product, there are also few limits to the type or style of home that can be built with our product. Architectural style has no limitations with this system. The intricacies of any design are created easily by the shape of the casting mold and the structural materials used, which are for the most part, treated steel and concrete.
+
+ 
+
+In addition our product will have the advantage of allowing for premium features not found in other building materials. Such features include soaring cathedral ceilings without unsightly trusses, tubular solar skylights to reduce energy consumption, energy efficiency with roof ratings in excess of R32 as mentioned under the "Our product" section above, sound reduction as befits such insulation value, utility rooms, lots of storage areas and single or double car garages.
+
+ 
+
+The panels for the construction of a home will be cast in our factory under tight quality control. There are large (typically 25' x 10') hydraulically tilting steel casting tables that can handle the largest panels of any house. Each panel mold is made up of vinyl moldboards that can be snapped together in the shape and size as required.
+
+ 
+
+Each wall panel incorporates a cast-in, skeletal reinforcing frame containing vertical steel tubes, through which the hold down bolts pass to secure the panel to the concrete slab base. At the same time, electric conduit and boxes are set in place and any plumbing vent tubes that are required.
+
+ 
+
+The specialized concrete is then applied to the mold and finished to a smooth, flat appearance. As the inside walls of the house are the inner side of the panel, surface finish
+is very important because the interior paint or other surfacing will be applied directly to that panel.
+
+ 
+
+The roof is made of energy efficient, individual panels of typically 18 x 4 sections. The undersides of these panels become the ceiling in the cathedral roof design. Because of their light weight, many panels can be loaded onto a step deck semi-trailer and delivered economically to the site, either close by or many miles away.
+
+ 
+
+The panels are then assembled on the prepared concrete slab by being craned into place. Long, high tensile bolts are fitted right down from the top of the wall panel and pass
+through the fabricated reinforcing frame pulling together a stable and strong assembly. A 2-millimeter (.080") thick adhesive/sealant barrier is applied between all concrete joints before being finally positioned and tightened down.
+
+16
+
+ 
+
+ 
+
+ 
+
+After setting of the wall panels, electrical wiring is fed through the conduit and the roof panels are then hoisted into place. These panels are held down with heavy duty,
+high tensile bolts threaded into the cast in receivers on the top of the side and cross walls.
+
+ 
+
+The wall and roof panels are usually set in place over 5 days and the finishing of the house is commenced. As a lot of the fitting is already cast into the panels at the factory, it takes just a few weeks to finish plumbing, electrical and fitting of windows and doors, cabinets and roof shingles or metal roof finish as required by the contract.
+
+ 
+
+The final stucco finish, once again simply applied direct to the concrete, is applied in 2 days and the house is ready for occupation.
+
+ 
+
+Other Potential Uses
+
+ 
+
+Although the Company will initially be focused on manufacturing panels for the construction of single family and multi unit housing, our product line may be expanded in the future for
+other uses.
+
+ 
+
+ 
+ 
+ Construction of commercial and industrial office and factory structures.
+
+ 
+ 
+ Construction of soundproof structures such as sound stages and studios.
+
+ 
+
+ 
+ 
+ Construction of molded structures such as arches and building fascias.
+
+ 
+ 
+ Construction of thermal structures such as public restrooms and cold stores.
+
+ 
+
+ 
+ 
+ Construction of walls and fences such as freeway sound barriers and general fencing.
+
+ 
+ 
+ Construction of lawn and garden furniture and attractions.
+
+ 
+
+ 
+ 
+ Construction of housing and structures using pre-made blocks and sections.
+
+ 
+
+Market
+
+ 
+
+Auscrete Corporation intends to position itself as a major supplier in the affordable housing market. Housing is generally considered "affordable" when its cost does not exceed 30 percent of the median family income in a given area. In many parts of the country, housing costs have begun to show signs of adversely affecting corporations, workers and local economies. Affordable housing is becoming increasingly scarce.
+
+ 
+
+Our Strategy
+
+ 
+
+We are going to promote a product that will not only make housing affordable but offer some luxuries as well, such as optional heat pump air conditioning that would not be available in other houses at such comparable pricing. We believe that by constructing with the Auscrete aerated concrete, those luxuries will result in lower cost utilities and a comfortable , ' ': feel to the living environment, as can be achieved
+with a product offering excellent thermal and soundproofing qualities as well as superb fire resistance.
+
+ 
+
+Our developers and contractors will offer the homes as complete ready constructed site built units on suitable land. They will not be offered under the banner of such categories as , ' ': pre-fabricated or , ' ': factory built homes. They are just plain good value masonry homes built of a time proven product, concrete.
+
+ 
+
+Initially, we intend to establish our operations and a manufacturing facility in the Industrial Estate area of Rufus, Oregon. Rufus is a small city about 110 miles east of Portland. Construction of the plant should take 4-5 months. The advantage of Rufus is it is located on 2 main highways, I-84 east/west and I-97 north/south.
+
+ 
+
+The location will help considerably with the delivery of our pre-cast panels initially to the Northwest area and will also simplify the delivery of raw materials to our facility. We anticipate that in the initial year we will be able to produce enough panel sets for the construction of 30 homes.
+
+ 
+
+We believe that we will be able to economically deliver whole house panel sets as far away as Arizona or Alberta, Canada. However, with a planned future facility to be set up in Central California, we believe that we will be able to achieve further efficiencies to be able to service a fast emerging market in this above average (for affordable housing) growth area. Additionally, a plant in Central California could easily initially address the Arizona market once the market recovery in that area has taken effect.
+
+ 
+
+We plan on selling most of our output to developers, contractors and builders who will purchase the complete set of wall, roof and interior panels from us and use their own construction crew to complete the house.
+
+17
+
+ 
+
+ 
+
+PROPOSED Capital Expenditures
+
+ 
+
+If the corporation, through its financing initiatives unrelated to this offering, should raise its minimum required funding of $450,000, the plan is to use the existing Pilot Plant to get the project started. Then, when the balance of the $3 million is raised, the Company will require the following capital expenditures in order to expand to meet the projected manufacturing requirements in a timely manner.
+
+ 
+
+Year 1 Capital Asset Purchases at funding of $3.0 million.
+
+ 
+ 
+ 
+ 
+ 
+
+ Year 1 Capital Asset Purchases
+ 
+ 
+ 
+ 
+
+ Purchase land, purchase one additional factory building and office building. Move in.
+ 
+ 
+ 530,000
+ 
+
+ Land Preparation and erection of buildings
+ 
+ 
+ 483,000
+ 
+
+ Machinery, silos, batchers, mixers, conveyers, trailers, crane & forklift.
+ 
+ 
+ 362,000
+ 
+
+ Specialized equipment, casting beds etc. manufactured , ' ': in house 
+ 
+ 
+ 226,000
+ 
+
+ Shop equipment, press, lathe, welders etc.
+ 
+ 
+ 179,000
+ 
+
+ Office equipment, drafting software, computers etc.
+ 
+ 
+ 25,000
+ 
+
+ Total Asset Expenditures Year 1
+ 
+ $
+ 1,805,000
+ 
+
+ 
+ First year working capital and expenses including wages and salaries, marketing,
+
+ other working capital and reserves
+
+ 
+ $
+ 1,195,000
+ 
+
+ Total Capital Expenditure, Working Capital and Reserves for year 1
+ 
+ $
+ 3,000,000
+ 
+
+ 
+
+ Year 2 Capital Asset Purchases below are needed if additional expansion is required.
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ Year 2 Capital Asset Purchases
+ 
+ 
+ 
+ 
+
+ Purchase 2 factory buildings, Erection and Commissioning
+ 
+ 
+ 480,000
+ 
+
+ Land Preparation and erection of buildings
+ 
+ 
+ 400,000
+ 
+
+ Machinery, silos, batchers, mixers, conveyers, trailers & forklifts.
+ 
+ 
+ 278,000
+ 
+
+ Specialized equipment, casting beds etc. manufactured , ' ': in house 
+ 
+ 
+ 176,000
+ 
+
+ Shop equipment, shears, rollers etc.
+ 
+ 
+ 12,000
+ 
+
+ Office equipment, drafting software, computers etc.
+ 
+ 
+ 20,000
+ 
+
+ Total Asset Expenditures Year 2
+ 
+ $
+ 1,366,000
+ 
+
+ 
+
+Marketing
+
+ 
+
+Our principal marketing efforts will be focused on interpersonal contacts and relationships. We intend to first leverage our contacts and relationships in and around Northwest Oregon along with our local knowledge of the area to market our product and distinguish ourselves. Our initial marketing thrust will include meetings with developers and construction companies to supply our product for their own construction needs. Although we intend to eventually build homes through our own construction division, we initially anticipate that over 90% of our sales will be to contractors and developers once our manufacturing gets off the ground.
+
+ 
+
+Revenue
+
+ 
+
+Revenue for the company will come from the sale of our concrete panels and panel sets. Specific prices may change due to elasticity of demand and fluctuations in commodity prices but currently our anticipated revenues are based upon the selling prices of typical size homes listed below:
+
+ 1,000 Sq. Ft. Home:
+ 
+ $
+ 70,000
+ 
+
+ 1,500 Sq. Ft. Home:
+ 
+ $
+ 110,000
+ 
+
+ 2,000 Sq. Ft. Home:
+ 
+ $
+ 138,000
+ 
+
+ 2,500 Sq. Ft. Home:
+ 
+ $
+ 170,000
+ 
+
+ 3,000 Sq. Ft. Home:
+ 
+ $
+ 202,000
+ 
+
+ 3,500 Sq. Ft. Home:
+ 
+ $
+ 236,000
+ 
+
+ 4,000 Sq. Ft. Home:
+ 
+ $
+ 270,000
+ 
+
+Once operative, 100 average houses produced per year equates to revenue of $14 million per year.
+
+At present the Company does not have any current customers or customer contracts. 
+
+ 
+
+18
+
+ 
+
+ 
+
+Competition
+
+ 
+
+The building supplier industry is a highly competitive industry. We compete with a large number of competitors in the construction supply business. In addition to other companies that manufacture and distribute pre-cast concrete wall, roof and interior panels, we will compete with companies that supply panels made of alternative materials including but not limited to, drywall, gypsum and wood. In addition, we will compete with local, regional and national home improvement retailers such as Home Depot and Lowe s who offer other building materials to the public and to contractors.
+
+ 
+
+Areas of Competition. Competition in the housing industry relate to contractors, builders and developers all striving to achieve the common goal of generating business in the home construction industry. The following are the principal areas that will compete with Auscrete products:
+
+ 
+
+a. Traditional Concrete Construction. Traditional concrete is generally used in warmer states (e.g., Florida to California). Costs fall around the $160 per sq. ft range
+and have little insulation value.
+
+b. ICF construction. ICF ("Insulating Concrete Forms") are external molds built of polystyrene with traditional concrete poured in between. ICF has insulation values comparable to Auscrete s products. However, it is a labor intensive industry and normally costs in excess of $190 per sq. ft.
+
+c. Raastra Block Construction. Raastra block has good insulation values but involves block-laying at the site and filling with mortar. This process is also labor intensive and usually costs in excess of $ 160 per sq. ft.
+
+d. AAC ("Aerated Autoclaved Concrete"). AAC is a process where aluminum oxides are added to the concrete mix and create oxygen bubbles by chemical reaction to lighten the weight of the mixture. This process involves the block-laying and mortar filling elements. Also, these blocks are easily broken and there is a high level of loss. This process can cost over $190 per sq. ft.
+
+e. Stick Built Construction (Wood frame). The most common construction method of residential construction, this process can cost between $95 and $180 per square foot. The strength of wood framing is considerably less than that of concrete.
+
+f. Alternative Construction Methods. Other construction methods include log houses, straw bale and various other alternative methods. These methods represent a very small percentage of the total construction market.
+
+ 
+
+Methods of Competition
+
+To distinguish themselves in the construction supply business, suppliers employ a variety of methods to separate themselves from the competition. One of the principal methods of competition is price. National companies and large regional suppliers leverage their buying power to offer building supplies at reduced prices. Local suppliers may attempt to match prices at the cost of reduced margins, but may look to other areas in which to compete. Suppliers may also tout their quality of materials, design, construction, deployment and customer service to distinguish themselves from the competition.
+
+ 
+
+We expect to face increased competition in the future. Further, many of our potential competitors have longer operating histories, greater name recognition, access to larger customer bases and significantly greater financial, sales and marketing, manufacturing, distribution, technical and other resources than us. However, we believe that our unique position of being able to provide environmentally friendly "Green" construction materials that are affordable and that incorporate a process that is distinguished from other building materials suppliers will allow us to compete effectively, especially in the Northwest where we have established relationships.
+
+ 
+
+Insurance
+
+ 
+
+We do not currently maintain insurance but intend to maintain general liability and other insurance to the standard in the industry.
+
+ 
+
+Employees
+
+ 
+
+We are a development stage company and currently have no salaried or waged employees. Our sole officer and the directors currently serve the Company for no compensation until the company is funded. There is no deferred compensation due.
+
+ 
+
+ 19
+
+ 
+
+ 
+
+Government Regulations
+
+ 
+
+Our products have already been approved to State and County building codes. The Auscrete of Oregon ACC concrete product which we will be assimilating has been submitted and approved by the State of Oregon as a pre fabricated building component and carries a registration with the Building Codes Division, license # PFC571. This registration is also accepted by the State of Washington as evidence of competency.
+
+ 
+
+Proposed future government regulations perhaps may include requirements for increased energy efficiency and material and construction standards for tornado and flood areas.
+
+ 
+
+At present, no environmental laws either at the federal, state or local levels applies to the Auscrete manufacturing process. If this changes in the future, and an environmental
+law becomes applicable, this could result in extra costs and delays that could have a negative effect on our business.
+
+ 
+
+Research and Development
+
+ 
+
+The aerated concrete that will be the basis of Auscrete s construction products is the product of the combination of a foaming agent and foaming machine. Research and development undertaken by Mr. Sprovieri since 2003 worked on creating a better aerated concrete by focusing on improving the following three areas: (a) the production of a machine to produce optimum sized bubbles, (b) identification of a surfactant (bubble producing liquid) that endures better while being aggressively mixed in concrete mixers and (c) the development of concrete mix recipes that give the best performance. The Auscrete aerated concrete has its roots in another aerated concrete developed by Cellucon starting in the mid 1980 s in Australia. Recognizing shortfalls in the Cellucon product including (a) the machine making the concrete produced erratic result and occasionally the concrete lacked strength and (b) the surfactant contained a biological animal protein that was odorous and unreliable.
+
+ 
+
+Mr. Sprovieri s research and development efforts have been focused on creating a more reliable machine and eliminating the animal protein component of the surfactant. Through his efforts, Mr. Sprovieri has been able to develop a synthetic component for the surfactant to replace the animal protein component while attaining the desired bubble wall strength while minimizing the size of the bubbles. Mr. Sprovieri has also worked to develop a bubble-producing machine that could produce bubbles of a consistent size with variable bubble size options. In connection with developing an optimum bubble-producing machine, Mr. Sprovieri conducted energy testing on samples of the concrete in a custom "hot box" built to the ASTM C1363-05 standard. He also conducted strength tests in cooperation with an ASTM certified laboratory in Oregon. Through his efforts, Mr. Sprovieri has been able to develop the optimum surfactant, bubble-producing machine and optimum concrete mix combinations for the creation of an optimum aerated concrete.
+
+ 
+
+Subsidiaries
+
+ 
+
+We do not have any subsidiaries.
+
+ 
+
+Intellectual Property
+
+ 
+
+Through the Founder and CEO, the company already has the following:
+
+ 
+
+Technology:
+
+A chemical design for the production of a surfactant that, when used in a foaming machine, can produce robust, micro-bubbles.
+
+The design of a foaming machine that, when using the above surfactant, can produce minute bubbles within the range necessary for ACC production.
+
+Know-how:
+
+The information gained from past production research and development of products that enables the correct mixing of the concrete base and micro bubbles to ensure precision blends of raw product.
+
+Branding:
+
+Ownership of the Auscrete name for use as trade marks, branding on product and literature and printing.
+
+ 
+
+ 20
+
+ 
+
+ 
+
+Office
+
+ 
+
+Our office is currently located at 504 East First St. Rufus OR 97050 and our telephone number is (541) 739-8298. This Pilot Plant location does not have the manufacturing capacity required by our anticipated operations. Upon financing, we intend to establish our headquarters and manufacturing facilities in the Rufus Industrial Estate. We do not pay any rent and there is no agreement to pay any rent in the future. Such costs are immaterial to the financial statements and, accordingly have not been reflected therein.
+
+ 
+
+LEGAL PROCEEDINGS
+
+ 
+
+We are not currently a party to any legal proceedings. Our address for service of process in Wyoming is 109 W. 17th St. Cheyenne, WY 82001.
+
+ 
+
+MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
+
+ 
+
+Admission to Quotation on the OTC Bulletin Board
+
+ 
+
+We intend to have our common stock be quoted on the OTC Bulletin Board. If our securities are not quoted on the OTC Bulletin Board, a security holder may find it more difficult to dispose of, or to obtain accurate quotations as to the market value of our securities. To qualify for quotation on the OTC Bulletin Board, an equity security must have one registered broker-dealer, known as the Market Maker, willing to list bid or sale quotations and to sponsor the company listing. Although, we have verbally asked a Broker Dealer/Market Maker to apply with the Financial Industry Regulatory Authority (FINRA) to have our common stock eligible for quotation on the OTC Bulletin Board by filing a Form 211, we may not now and may never qualify for quotation on the OTC Bulletin Board.
+
+ 
+
+Stockholders of our Common Stock
+
+ 
+
+As of the date of this registration statement, we have 43 registered shareholders. The 20 largest shareholders are as follows:
+
+ 
+
+ 
+ 
+ NAME
+ ADDRESS
+ SHARES
+
+ 1
+ 
+ Clifford D. Jett
+ PO Box 846, Rufus, OR 97050
+ 3,000,000
+
+ 2
+ 
+ John Sprovieri
+ PO Box 813, Rufus, OR 97050
+ 9,750,000
+
+ 3
+ 
+ William Beers
+ PO Box 825, Rufus, OR 97050
+ 3,000,000
+
+ 4
+ 
+ Kimberly A. Grimm
+ PO Box 801, Rufus OR 97050
+ 2,010,000
+
+ 5
+ 
+ VAWT Earth Wind and Power
+ Unit 2393 Sidney, B.C. V8L 3Y3
+ 970,000
+
+ 6
+ 
+ Martin J. Kelly
+ PO Box 813, Rufus OR 97050
+ 510,000
+
+ 7
+ 
+ Lynn Komar
+ 61560 Sunny Breeze Lane, Bend, OR 97702
+ 250,000
+
+ 8
+ 
+ Julie Jett Regnell
+ 1126 Olmo Way, Boulder City, NV 89005
+ 30,000
+
+ 9
+ 
+ Robert Tanner
+ PO Box 54, Grass Valley, OR 97029
+ 25,000
+
+ 10
+ 
+ Joe Hobbs
+ 210 Webber Street, The Dalles, OR 970587
+ 25,000
+
+ 11
+ 
+ Billy Sullivan
+ PO Box 614, Hood River OR 97031
+ 25,000
+
+ 12
+ 
+ Dan Newbold
+ 30303 Maple Drive, Junction City, OR 97448
+ 25,000
+
+ 13
+ 
+ Lee Hall
+ 30325 Maple Dr. Junction City, OR. 97448
+ 25,000
+
+ 14
+ 
+ Kathleen D. Jett
+ PO Box 846, Rufus, OR 97050
+ 10,000
+
+ 15
+ 
+ Mary E Sprovieri
+ PO Box 813, Rufus, OR 97050
+ 10,000
+
+ 16
+ 
+ Linda Beers
+ PO Box 825, Rufus, OR 97050
+ 10,000
+
+ 17
+ 
+ Marjorie E. Yarnell
+ PO Box 6, Rufus OR 97050
+ 10,000
+
+ 18
+ 
+ Sharon R. Nolan
+ PO Box 745, Rufus, OR 97050
+ 10,000
+
+ 19
+ 
+ Ryan R. Regnell
+ 1126 Olmo Way, Boulder City, NV 89005
+ 10,000
+
+ 20
+ 
+ Ryan P. Sharp
+ PO Box 351, Pendleton, OR 97801-0351
+ 10,000
+
+ 
+
+Rule 144 Shares
+
+ 
+
+Most of the presently outstanding shares of our common stock are "restricted securities" as defined under Rule 144 promulgated under the Securities Act and may only be sold pursuant to an effective registration statement or an exemption from registration, if available. All our issued and outstanding shares have been held since at least February 4, 2010, and are subject to the restrictions and sale limitations imposed by Rule 144. Under Rule 144, the shares can be publicly sold, subject to volume restrictions and restrictions on the manner of sale, commencing one (1) year after the Company is no longer deemed a "shell company" as defined in Rule 12b-2 of the Exchange Act, as amended.
+
+21
+
+ 
+
+ 
+
+ 
+
+Stock Option Grants
+
+ 
+
+To date, we have not granted any stock options.
+
+ 
+
+Registration Rights
+
+ 
+
+We have not granted registration rights to the selling shareholders or to any other person.
+
+ 
+
+Dividends
+
+ 
+
+There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends.
+
+PLAN OF OPERATIONS
+
+ 
+
+Our plan of operations will depend wholly on our ability to acquire initial funding in the order of $450,000. Our next milestone will be to acquire additional funding of $2,550,000. Upon achievement of raising these funds, our plan of operations for the succeeding twelve months thereafter are as discussed below beginning with the "Establish Office and Manufacturing Facility" subsection:
+
+ 
+
+Registration and Offer of Securities
+
+ 
+
+Our first milestone is to obtain a symbol to facilitate quotation of our shares on the OTC Bulletin Board. We have verbally agreed to engage a registered broker-dealer and market maker, to apply with the Financial Industry Regulatory Authority to have our common stock eligible for quotation on the OTC Bulletin Board. With the assistance of the Market Maker, we anticipate obtaining quotation of our common stock on the OTC Bulletin Board . The Market Maker will not be compensated by the Company. The nature of the costs we will incur in connection with this offering include audit, legal, and SEC registration costs. These costs, initially estimated at $12,344.00, will be incurred entirely by the Company.
+
+ 
+
+Establish Office and Manufacturing Facility
+
+ 
+
+At the outset, we intend to use already existing manufacturing Plant and Equipment capabilities upon raising of $450,000. We believe the additional funding up to $ 3,000,000 would be required to expand our manufacturing capacity. Of the $3 million it will cost approximately $1,604,000 to set up our new manufacturing facility on the Industrial Estate. Another $1,396,000 would be required to cover the first year's $475,000 necessary for salary and wages to hire executive, administrative, marketing and labor personnel necessary to achieve independent revenues and to expand our operations as well as other working capital and reserves. Initial capital expenses for the first 12 months following the raising of $3 Million is discussed in "Description of Business" section above.
+
+ 
+
+ 
+
+Beginning Operations
+
+ 
+
+Our Corporation will acquire the existing manufacturing plant and equipment from Auscrete of Oregon. Additionally, it will take over an existing pilot plant facility owned from the City of Rufus, and will employ the previously trained staff of Auscrete of Oregon to ensure a smooth transition and continuation of production and revenues.
+
+ 
+
+ 
+
+22
+
+ 
+
+ 
+
+Proposed Expansion of Manufacturing Facility
+
+ 
+
+Auscrete Corporation has been offered a little over 10 acres of Industrial Land by the City of Rufus in their Industrial Park with utilities already in place. The company will acquire this land under contract once adequate funding has been raised.
+
+ 
+
+The new complex will start out with a rebar fabrication building that will also be a maintenance area and inventory storage facility. There is also a production building that has a concrete mixer at one end close to the cement silo and other necessary supply points. This building will house 24 casting tables. The other end of the building has the finishing area where panels get applied coatings and final inspection before being taken to storage and shipping.
+
+ 
+
+Operations Management
+
+ 
+
+Operations will begin at the existing plant immediately upon funding availability. When the new Fabrication Building and Production Building has been completed at the industrial site, production will be moved there.
+
+ 
+
+The Auscrete Team will comprise of a minimal tiered management structure that enables control and knowledge to be firmly at the hands of senior management ensuring rapid and simplified direct reporting.
+
+ 
+
+Upon commencement of Auscrete s activity, under control of the President will be marketing, manufacturing operations, design architecture and engineering, administration and safety officer. Additionally, there is a construction manager that will oversee Auscrete s own construction activities as well as liaise with contractors and developers.
+
+Management and Operations Structure
+
+ 
+
+Production Facilities
+
+ 
+
+Once operations are commenced, the Auscrete product is mostly the production of specialty cast concrete panels used to build houses and other structures. The main activity on a daily basis is the preparation of molds on the molding tables and the application of rebar and other inclusions before pouring the mixture. The Auscrete ACC mixture is blended at the mixing station and poured into the molds where they cure for 2 days. Normally 12 molds per day would be completed. The plant will operate on 1 shift as the curing time required reduces the necessity of having staff present. The graphic below show a typical cycle of manufacturing for housing components.
+
+ 
+
+Once the panels are cured, they are removed from the hydraulic tilting casting tables by use of special lifting apparatus attached to heavy duty forklifts. They are then taken through finishing where small imperfections are attended to and any required surface finishing is applied.
+
+ 
+
+Panels are then stored in the pre-manufactured racks until all components for a specific house are complete. We will load our specially fitted trailers with the complete panel sets and ship them to the prepared site via our own transportation and deliver them to the contractor or developer for final construction and finishing of the house.
+
+ 
+
+In many cases our trucks can return with raw materials from supplier depots throughout the country.
+
+23
+
+ 
+
+ 
+
+ 
+
+ 
+
+Marketing
+
+ 
+
+Once the manufacturing facility is complete, Auscrete will employ a qualified marketing individual to extend its marketing functions when the new production plant is brought
+online.
+
+ 
+
+It is anticipated that full marketing mode can be reached within 3-4 months, certainly much earlier than is necessary to keep the operation at its peak output. The Company will offer a wide range of pre-designed houses and also work with clients to achieve their own design needs.
+
+ 
+
+The Company will sell to developers, construction contractors, building companies and individuals. The main thrust of the marketing will be the construction of affordable housing with energy efficiency. Additional markets will be accessed from the small commercial and industrial developments that are part of the future of commerce.
+
+ 
+
+The marketing manager will keep abreast of the moving tide of opportunity by use of the many communication systems available today and be able to get involved in short and long term governmental and private projects.
+
+ 
+
+Design & Architecture
+
+ 
+
+The technology we are using has already been applied to basic design and construction of housing and commercial and industrial structures. We can easily adapt many of our customer's designs to our construction methods simply by adhering to some basic design criteria within the parameters of our concrete construction and engineering.
+
+ 
+
+The chief design engineer will be responsible for the application of new designs utilizing all available technologies to enhance the final renderings. The other responsibility is to lead a team of drafters that will draw each individual panel or section and ensure the accuracy of the fitment prior to dispensing the drawing to the production shop.
+
+ 
+
+24
+
+ 
+
+ 
+
+The design department will keep abreast of all new building codes and amendments so that the Auscrete product always conforms to the current regulations of the construction industry.
+
+ 
+
+Construction Division
+
+ 
+
+The company will employ an experienced and qualified construction manager. The responsibilities of this person are multi fold. Auscrete will be carrying out its own construction during the development of its own campus. The construction manager will administer control of that expansion.
+
+ 
+
+Additionally, when the company has its own crew erecting its own products, the construction manager will be able to supervise the ongoing work and final completion of the project.
+
+ 
+
+Most importantly will be the liaison with outside contractors and developers ensuring that they are trained and understand the construction methods to be employed when erecting Auscrete products and structures.
+
+ 
+
+Internal Administration
+
+ 
+
+The position of Administration Manager will be filled by a suitably qualified individual with previous accounts based experience that understands and can perform the daily needs of a public corporation. They will be responsible to senior management for full compliance with securities issues and submissions. As production expands and the company grows, an assistant will be added as required.
+
+ 
+
+Safety Officer
+
+ 
+
+The safety officer will take care of safety issues that might arise on a day to day basis. A regular schedule of compliance based on OSHA and other regulations and safety
+checks will be developed as the production gets under way and the safety officer will be responsible for constant observation of these issues.
+
+ 
+
+Limited Operating History
+
+ 
+
+We cannot guarantee success of our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including
+limited capital resources and possible cost overruns due to price and cost increases in services and products.
+
+ 
+
+Results of Operations for Period Ending September 30, 2014
+
+ 
+
+We did not earn any revenues from our incorporation on December 31, 2009 to December 31, 2013, as evidenced by our audited financial statements and minimal revenue of $2,920 for the interim period ended September 30, 2014 (unaudited). We have not attained profitable operations and are dependent upon obtaining financing to continue with our business plan.
+
+ 
+
+Public Company Expenses
+
+ 
+
+Without operations, the Company will incur nominal expenses that will be paid for with the Company's available loans from shareholders and cash on hand which was $10.00 as at December 31, 2013. The Company's cash on hand is to be used to satisfy audit and legal expenses in connection with the reporting requirements for a public company under the Exchange Act of 1934. Any expenses incurred in excess of the Company's cash on hand may require the Company's founder to contribute additional cash to maintain the Company as a going concern. If the Company's founder is unable to contribute additional capital to the Company to satisfy these reporting company expenses, the Company may have to discontinue operations as a going concern.
+
+ 
+
+CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
+
+ 
+
+We have had no disagreements with our current auditors.
+
+ 
+
+Previous auditor for the company, Anton & Chia, LLP audited the Company's financial statements for the year ended December 31, 2012. Anton & Chia, LLP was dismissed as the Company's auditors on June 3, 2014 as they were non-responsive and unable to complete the 2013 audit in a timely fashion. Our current Auditor, MartinelliMick PLLC has performed an audit for the 2 year period ending December 31, 2013 and for the period from January 1, 2010 (inception) through December 31, 2013.
+
+ 
+
+AVAILABLE INFORMATION
+
+ 
+
+We have filed this registration statement on Form S-1 under the Securities Act of 1933 with the Securities and Exchange Commission with respect to the shares of our Selling Shareholders' common stock offered through this prospectus. This prospectus is filed as a part of that registration statement, but does not contain all of the information contained in the registration statement and exhibits.
+
+ 
+
+25
+
+ 
+
+ 
+
+ You may inspect the registration statement, exhibits and schedules filed with the Securities and Exchange Commission at the Commission's principal office in Washington, D.C. Copies of all or any part of the registration statement may be obtained from the Public Reference Section of the Securities and Exchange Commission, 100 F Street NE, Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms.
+
+ 
+
+The Securities and Exchange Commission also maintains a web site at http://www.sec.gov that contains reports, proxy statements and information regarding registrants that file electronically with the Commission. Our registration statement and the referenced exhibits can also be found on this site.
+
+ 
+
+DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
+
+ 
+
+Our sole executive officer and the directors and their ages as of the date of this prospectus are as follows:
+
+ 
+
+John Sprovieri – CEO/Director, Age 66
+
+John Sprovieri is a dual American/Australian citizen born in Brisbane, Australia to American parents and is 66 years old. He and his wife, Mary have been married near 46 years and have no children. His background is mechanical engineering and he spent 6 years in construction machinery marketing with Industrial Engineering Limited in Australia becoming Sales Manager for their Contracting Plant Equipment Division.
+
+ 
+
+In 1975, he developed an agricultural/industrial tractor and developed both the manufacturing and marketing segments of his company, Australian Tractor Manufacturers Pty. Ltd. The corporation produced nearly 500 units over the next 14 years until he sold the company to Just Australia China Holdings Ltd. (JACH) with interests in China, Korea and Russia. The company was operating profitably at the time it was sold. JACH were setting up overseas operations and were going to manufacture in China or South Korea.
+
+ 
+
+John stayed on with the corporation liaising with overseas licensed manufacturers and markets. He traveled extensively into Europe, USSR, the Middle East and North America.
+
+ 
+
+Following completion of his obligations to JACH in 1993, he researched the US West Coast Market for low cost housing development, and started a transport company following working with 2 transport companies in Washington and Oregon in various positions throughout the West Coast corridor for nearly 3 years. In 1997 John launched an interstate transport company and was responsible for all facets of management including finance, operations, personnel and government compliance. In 2003, John commenced development of the Auscrete technology and acquired financing to further develop the Cellucon based technology and product with a view to creating an affordable housing manufacturing operation.
+
+ 
+
+John s transport company suffered setbacks in 2003 with the need to write off over $100,000 due to a factoring company not performing their due diligence in checking and following the financial status of some customers. These customers subsequently filed bankruptcy creating the loss. With the increasing cost of fuel and other overheads and the inability to raise rates and, after paying the Factoring Company what was due, it was decided by 2005 to close down operations and concentrate on affordable housing development.
+
+ 
+
+During the past ten years since 2003, Mr. Sprovieri has been principally involved with launching and managing the Auscrete of Oregon development activities. During this
+time, Mr. Sprovieri has set up a manufacturing facility, trained personnel, redeveloped technology and started production of Auscrete Products in 2007.
+
+ 
+
+Clifford Jett – Director, Age 73
+
+ 
+
+Cliff, at 73 is currently the Mayor of the City of Rufus and has been since 1998. He steps down as Mayor on December 31, 2014. He is chairman of the Lower John Day Regional Partnership and on the Board of Directors of Mid-Columbia Council of Governments. He is also a member of the Mid Columbia Economic Development District and the Lower John Day Area Commission on Transportation.
+
+ 
+
+Cliff comes from the Columbia Gorge and has an intimate knowledge of the area. He and his wife, Kay live in Rufus on their small agricultural holding. In his earlier career
+he became heavily involved in Law Enforcement and, since 1967, spent many years in Nevada commencing as a Conservation Fieldman II for the Nevada Dept. of Fish and Game. Until 1991, he worked through the ranks to achieve Region III L.E. Supervisor status as Fish and Game Agent III at the Nevada Dept. of Wildlife. This diverse career gave Cliff much experience in management, public relations, budgeting, law enforcement knowledge, personnel evaluations and preparation of quarterly and annual reports.
+
+ 
+
+26
+
+ 
+
+ 
+
+In 1996, Cliff became a city councilman for the City of Rufus and was elected Mayor in 1998. In addition to being a deputy of the Sheriff s Department in the marine division, he is also a vineyard farmer and a partner in a small museum in the area. Cliff s 23 years in Law Enforcement gave him the ability to display professionalism and integrity as part of his life's philosophy. His leadership and problem solving ability make him well qualified to serve on the Board of Directors of this corporation.
+
+ 
+
+William Beers – Director, Age 78
+
+ 
+
+Bill has lived in Sherman County since 1956 and lives with his wife, Linda in the City of Rufus. He is 78 and recently retired. He served as a councilman for the City of Rufus until 2013 and had served for a number of years. Bill is directly involved in the presentation of the city to possible development of local businesses and commercial and industrial enterprises by encouraging potential business people to move to the city's business park.
+
+ 
+
+Bills experience in business management stretches back decades. He has owned and managed a number of business including a truck stop service station and restaurant, all of which he sold when they were operating profitably and are still operating today. Around 15 years ago and approaching retirement age, Bill and his wife Linda purchased the Hi-Way Market general store and deli in Rufus and shared the business and personnel management responsibilities. Seeking retirement, they leased the business to their employees.
+
+ 
+
+In
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001492966_nord_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001492966_nord_prospectus_summary.txt
new file mode 100644
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--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001496337_etfs_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001496337_etfs_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001496371_moko_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001496371_moko_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001496371_moko_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001498291_daniels_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001498291_daniels_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..0b90506b3db84cf7ed5814f9af5b4e935e79935f
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@@ -0,0 +1 @@
+S-1/A 1 daniels_s-1.htm Unassociated Document As Filed with Securities and Exchange Commission on June 26, 2014 Registration No. 333-193981 SECURITIES AND EXCHANGE COMMISSION FORM S-1 A Amendment No. 1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 DANIELS CORPORATE ADVISORY COMPANY, INC. (Exact name of registrant as specified in its charter) Nevada (State or other jurisdiction of Incorporation or organization) 6199 (Primary Standard Industrial Classification Code Number) 04-3667624 (I.R.S. Employer Identification No.) Parker Towers, 104-60, Queens Boulevard 12th Floor Forest Hills, New York 11375 (347) 242-3148 (Address and Telephone Number of Registrant s Principal Executive Offices and Principal Place of Business) Mr. Arthur D. Viola Chief Executive Officer Daniels Corporate Advisory Company, Inc. Parker Towers, 104-60, Queens Boulevard 12th Floor Forest Hills, New York 11375 (347) 242-3148 (Name, Address and Telephone Number of Agent for Service) With a Copy to: James Deolden, Esq., The Law Offices of James Deolden One Silver Crescent Irvine, California 92603. Tel: (949) 433 - 3362 Fax: (949) 679 - 9079 Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. x If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer, and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer o Accelerated filer o Non-accelerated filer o (Do not check if a smaller reporting company) Smaller reporting company x CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered(1) Proposed Maximum Per Share Offering Price Proposed Maximum Aggregate Offering Price Amount of Registration Fee (2) Common stock, $0.001 par value per share (3) 2,600,000 $ 0.50 $ 1,300,000 $ - Common Stock, $0.001 par value per share (4) 4,990,250 $ 0.50 $ 1,495,125 $ - Total 7,590,250 $ 0.50 $ 3,795,125 $ 0 (1) Pursuant to Rule 416(b) of the Securities Act of 1933, as amended, the shares of common stock being registered hereunder includes an indeterminate number of shares of common stock as may be issuable with respect to the shares being registered hereunder resulting from the split of, or the stock dividend on, the registered securities. (2) The registration fee has been calculated in accordance with Rule 457(P) of the Securities Act of 1933, as amended. (3) This registration statement covers our direct offering of up to 2,600,000 shares of our common stock ( Direct Offering Shares ) that may be sold by the registrant from time to time, for a maximum aggregate offering price of all securities not to exceed $1,300,000. (4) This Registration Statement covers the resale by our selling shareholders of up to 4,990,250 shares of common stock previously issued to such selling shareholders. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY DETERMINE. TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission becomes effective. This prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION ON DANIELS CORPORATE ADVISORY COMPANY, INC. 7,590,000 Shares of Common Stock Daniels Corporate Advisory Company, Inc. ( we , us , or the Company ) is (i) offering for sale a maximum of 2,600,000 shares of its common stock, par value $0.001, at a fixed price of $0.50 per share (the Offering ) and (ii) registering for resale by the selling stockholders of up to 4,990,250 shares of our common stock, $.001 par value (the Resale). There is no minimum number of shares that must be sold by us for the Offering to close, and therefore we may receive no proceeds or very minimal proceeds from the Offering. The aggregate offering price of all securities sold under this Offering may not exceed $1,300,000. We will retain the proceeds from the sale of any of the offered shares that are sold. The Offering is being conducted on a self-underwritten, best efforts basis, which means this prospectus will permit our officers and directors to sell the shares directly to the public, with no commission or other remuneration payable to them for any shares they may sell. The Company may not sell the shares to the public until this registration statement is declared effective by the Securities and Exchange Commission (the SEC ). We have no arrangement to place the proceeds from this Offering in an escrow, trust or similar account. Any funds raised from sales of shares to the public pursuant to this Offering will be immediately available to us for our use and retained by us regardless of whether or not there are any additional sales under this Offering. You will not have the right to withdraw your funds during the offering. We may offer and sell these securities through the method described under Plan of Distribution in this prospectus. Below is a summary of proceeds, before and after calculating aggregate offering costs of approximately $15,000 in cash, which we may receive from the sale of the shares in the Offering: Percentage of Shares Sold Shares Sold Gross Proceeds to Company Net Proceeds to Company after Offering Costs 20% 520,000 $ 260,000 $ 245,000 50% 1,300,000 $ 650,000 $ 635,000 100% 2,600,000 $ 1,300,000 $ 1,285,000 The Offering will terminate upon the earlier to occur of: (i) the sale of all 2,600,000 shares being offered, or (ii) 365 days after this registration statement is declared effective by the SEC. In addition to the Offering, this prospectus also covers the resale by the selling stockholders of up to 4,990,250 shares of our common stock, $0.001 par value (the Resale). Daniels Corporate Advisory Company, Inc. Consolidated Statements of Cash Flows For the Three Months Ended February 28, 2014 February 28, 2013 Unaudited Unaudited Cash flows from operating activities: Net income (loss) $ 95,260 $ (53,039 ) Common stock issued for expenses 0 0 Realized gain(loss) on securities 0 32,921 (Increase)decrease in other assets 4,215 (33,000 ) (Increase)decrease in accounts receivable 4,902 0 Increase(decrease) in accounts payable and accrued expenses 11,246 53,039 Net cash used in operating activities 115,623 (79 ) Cash flows from investing activities: None 0 0 Net cash provided(used) by investing activities 0 0 Cash flows from financing activities: None 0 0 Net cash provided(used) by financing activities 0 0 Increase in cash and equivalents 115,623 (79 ) Cash and cash equivalents at beginning of period 2,809 82 Cash and cash equivalents at end of period $ 118,432 $ These securities will be offered for sale from time to time by the selling stockholders identified in this prospectus in accordance with the terms described in the section of this prospectus entitled Plan of Distribution. The selling stockholders participating in the distribution of the shares of Common Stock and any broker-dealers participating in the distribution of the shares of Common Stock will be deemed to be underwriters within the meaning of the Securities Act, and any commission paid, or any discounts or concessions allowed to, any such broker-dealer may be deemed to be underwriting commissions or discounts under the Securities Act. We will not receive any of the proceeds from the sale of the common stock by the selling stockholders. Our securities are not listed on any national securities exchange. Our common stock is quoted on the Over-the-Counter Bulletin Board (the OTCBB ) under the ticker symbol DCAC. Our stock has yet to have any trading activity on the OTCBB. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ) and, as such, may elect to comply with certain reduced public company reporting requirements for future filings. THE SECURITIES OFFERED HERBY INVOLVE A HIGH DEGREE OF RISK.INVESTING IN OUR COMMON STOCK INVOLVES RISKS WHICH ARE DESCRIBED UNDER RISK FACTORS, beginning on page 7 of this prospectus. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The date of this prospectus is June 26, 2014 PROSPECTUS SUMMARY This summary highlights information described more fully elsewhere in this prospectus. You should read the entire prospectus carefully. In this prospectus, Daniels Corporate Advisory, the Company, we, us and our refer to Daniels Corporate Advisory Company, Inc., a Nevada corporation. This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our securities. You should read the entire prospectus, including Risk Factors and the consolidated financial statements and the related notes before making an investment decision. We, us, our company, our, Daniels, Daniels Corporate Advisory Co. and the Company refer to Daniels Corporate Advisory Company, Inc., but do not include the shareholders of Daniels Corporate Advisory Company, Inc. THE OFFERING Shares of common stock offered by the Company 2,600,000 Shares of common stock outstanding before the Offering 9,791,319 Shares of common stock outstanding after the Offering 12,391,319 Terms of the offering Our director and officers will sell shares upon effectiveness of this prospectus. Trading Market Our common stock is quoted on the OTCBB under the trading symbol DCAC. Use of proceeds We will use the proceeds for investor relations, online marketing, brand awareness, general working capital, and the completion of two corporate strategy consulting assignments
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+PROSPECTUS SUMMARY You should read the following summary together with the more detailed information and the financial statements appearing elsewhere in this Prospectus. This Prospectus contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under Risk Factors and elsewhere in this Prospectus. Unless the context indicates or suggests otherwise, references to we, our, us, the Company, Xumanii , or the Registrant refer to Xumanii International Holdings Corp., a Nevada corporation. Overview Xumanii International Holdings Corp. ( Xumanii ) was incorporated in the State of Nevada on May 6, 2010. The Company maintains its statutory registered agent s office at Nevada Corporate Headquarter, 101 Convention Center Drive, Suite 700 Las Vegas, Nevada 89109 and the Company s mailing address and business office is located at 9550 South Eastern Ave. Suite 253-A86 Las Vegas, NV 89123. The Company's name and trading symbol were changed from Medora Corp. and MORA effective September 7, 2012 to Xumanii, Inc. and XUII, respectively. Subsequently the name was changed to Xumanii International Holdings Corp. Until September 30, 2013, Xumanii was a platform that broadcasted live events in HD with a new technology that combined hardware and a software platform to broadcast from multiple cameras, wirelessly an event with an extremely low production cost. In October 2013, the business plan for Xumanii was changed to enter into the branded tablet market, app market and pursue acquisitions that may be synergistic to the company s focus in various technologies. Recent Developments Xumanii announced that it has completed the acquisition of Rocky Mountain Tracking ("RMT") on July 22, 2014. RMT is an established provider of GPS tracking solutions in North America. The Company has signed a definitive agreement to acquire RMT Leasing Inc. and its subsidiary Rocky Mountain Tracking Inc. This transaction is not subject to any further action and is effective immediately. For the year ended April 30, 2014, RMT generated revenues of $1.3 million and EBITDA of approximately $200,000. Xumanii acquired RMT for $3.1 million, consisting of a combination of cash, a note and preferred stock. Most or all of the employees of RMT will continue with Imerjn. RMT has been a leading provider of GPS tracking solutions since 2003. It offers several GPS trackers and GPS tracking systems that are ideal for personal or business use. RMT's software is proprietary and enables users to track the movement of virtually anything using superior tracking devices. As of October 10, 2014, there were 6,077,232,853 shares of our common stock outstanding, of which 4,013,150,438 shares were held by non-affiliates. During the quarter ended April 30, 2014 Xumanii advanced $541,451 in ACLH, LLC an entity associated with the Company s CEO. $322,950 of this has been paid back. The remaining balance of $218,501 has been converted into stock of Velocity Data Inc, an entity in which ACLH holds an interest Based on Velocity s market cap on September 11, 2014 of $25,387,505 ($.265/share x 95,801,907 shares) and the $218,501 investment balance as a percentage of the purchase price of $3.6 million (6%) Xumanii s investment is worth $1,540,944. On September 25, 2014 the Company s stock was suspended by the SEC until October 8, 2014. The reasons cited in the public notice were lack of adequacy or accurateness of press releases. The Company reviews all press releases prior to submission and has support for all items listed, so believes they are accurate and sufficient. The Company will keep investors up to date with the ramifications of this matter. The stock currently trades on the grey sheets -this could present problems for those wishing to conduct regular trading. You should talk with your broker about how to trade during this time. The Company and primary shareholder approved a 10,000 for 1 stock split and a name change to Imerjn on September 22, 2014. More details of this are in the 14c filing. Acquisition update/recap: 1) NTIH-The Company spent many months working with various counsel, lenders and the seller on a telecommunications acquisition. After attempting a 3a10 transaction in the California courts it was determined that the target was not profitable enough to warrant such an extremely complex regulated transaction. 2) The Gettv acquisition (originally by Inflexion LLC) in February 2014 was assigned to Xumanii at that time EQUITY FACILITY ANALYSIS At an assumed purchase price of $0.0001 (equal to the closing price of our common stock of $0.0001 on September 23, 2014), we would receive approximately $132,433 in gross proceeds if all registered shares were sold. Furthermore, we may receive substantially less than $132,433 in gross proceeds from the financing due to our share price fluctuation, discount to market and other factors relating to the common stock. The issuance of new shares could cause additional substantial dilution to our stockholders. We currently have authorized and available for issuance 10,000,000,000 shares of our common stock pursuant to our charter. The following table sets forth the total number of Shares that would be issued at varying purchase prices for us to receive the entire $5,000,000 in gross proceeds under the Equity Credit Agreement (without accounting for certain fees and expenses): Assumed Average Purchase Price (1) Total Number of Shares to be Issued if Full Price Percentage of Currently Outstanding Shares (2) Shares Under the Equity Credit Agreement $0.0001 (3) 50,000,000,000 823% $5,000,000 $0.0002 (4) 25,000,000,000 411% $5,000,000 $0.0005 (5) 10,000,000,000 165% $5,000,000 $0.0010 (6) 5,000,000,000 82% $5,000,000 $0.0100 (7) 500,000,000 8% $5,000,000 $0.1000 (8) 50,000,000 1% $5,000,000 (1) Under the Equity Credit Agreement, with respect to a Regular Draw Down Notice, if the price falls below the applicable Floor Price on any trading day during the applicable Pricing Period, the Equity Credit Agreement provides that Southridge will not purchase the pro rata portion of the applicable Draw Down Amount allocated to that trading day. We may not sell shares to Southridge pursuant to a Fixed Draw Down Notice for a Fixed Purchase Price less than the Fixed Floor Price due to certain equity conditions that must be satisfied in order for us to be eligible to deliver a Fixed Draw Down Notice. (2) The denominator is based on 6,077,232,853 shares outstanding as of October 10, 2014, adjusted to include 55,555,556 Commitment Shares that were issued to Southridge as consideration for its commitment to purchase our common stock pursuant to the Equity Credit Agreement. The numerator is based on the number of Shares issuable to Southridge under the Equity Credit Agreement at the corresponding assumed average purchase price set forth in the adjacent column. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 XUMANII INTERNATIONAL HOLDINGS CORP. (Exact name of registrant as specified in its charter) Nevada 5900 90-0582397 (State or jurisdiction of (Primary Standard Industrial (I.R.S. Employer incorporation or organization) Classification Code Number) Identification No.) 9550 South Eastern Ave. Suite 253-A86 Las Vegas, NV 89123 (800) 416-5934 (Address and telephone number of principal executive offices and principal place of business) National Registered Agents, Inc. 311 Division St. Carson City, Nevada 89703 (800) 550-6724 (Name, address and telephone number of agent for service) Copies to: Bob Bates, CFO, CPA, CVA, CFE bob@imerjn.com Telephone No.: (415) 264-0984 Facsimile No.: (617) 208-2968 Approximate date of proposed sale to the public: From time to time after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company (3) Assumed average purchase price is equal to 100% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (4) Assumed average purchase price is equal to 200% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (5) Assumed average purchase price is equal to 500% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (6) Represents the 1,000% of the closing sale price of our common stock on October 10, 2014. (7) Assumed average purchase price is equal to 10,000% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (8) Assumed average purchase price is equal to 100,000% of the closing sale price of our common stock of $0.0001 on October 10, 2014. The following table sets forth the amount of proceeds we would receive from Southridge from the sale of Shares under the Equity Credit Agreement that are registered in this offering at varying purchase prices (without accounting for certain fees and expenses): Assumed Average Purchase Price (1) Total Number of Shares to be Issued if Full Price Percentage of Currently Outstanding Shares (2) Shares Under the Equity Credit Agreement $0.0001 (3) 1,324,339,645 21.8% $132,434 $0.0002 (4) 1,324,339,645 21.8% $264,868 $0.0005 (5) 1,324,339,645 21.8% $662,170 $0.0010 (6) 1,324,339,645 21.8% $1,324,340 $0.0100 (7) 1,324,339,645 21.8% $13,243,396 $0.1000 (8) 1,324,339,645 21.8% $132,433,965 (1) Under the Equity Credit Agreement, with respect to a Regular Draw Down Notice, if the price falls below the applicable Floor Price on any trading day during the applicable Pricing Period, the Equity Credit Agreement provides that Southridge will not purchase the pro rata portion of the applicable Draw Down Amount allocated to that trading day. We may not sell shares to Southridge pursuant to a Fixed Draw Down Notice for a Fixed Purchase Price less than the Fixed Floor Price due to certain equity conditions that must be satisfied in order for us to be eligible to deliver a Fixed Draw Down Notice. (2) The denominator is based on 6,077,232,853 shares outstanding as of October 10, 2014. The numerator is based on the number of Shares issuable to Southridge under the Equity Credit Agreement at the corresponding assumed average purchase price set forth in the adjacent column. (3) Assumed average purchase price is equal to 100% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (4) Assumed average purchase price is equal to 200% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (5) Assumed average purchase price is equal to 500% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (6) Represents the closing sale price is equal to 1,000% of our common stock on October 10, 2014. (7) Assumed average purchase price is equal to 10,000% of the closing sale price of our common stock of $0.0001 on October 10, 2014. (8) Assumed average purchase price is equal to 100,000% of the closing sale price of our common stock of $0.0001 on October 10, 2014. Southridge has agreed that during the term of the Equity Credit Agreement, neither Southridge nor any of its affiliates will, directly or indirectly, engage in any short sales involving our securities or grant any option to purchase, or acquire any right to dispose of or otherwise dispose for value of, any shares of our common stock or any securities convertible into or exercisable or exchangeable for any shares of our common stock, or enter into any swap, hedge or other similar agreement that transfers, in whole or in part, the economic risk of ownership of any shares of our common stock. Southridge will not be prohibited from selling any of the shares of our common stock that it owns or that it is obligated to purchase under a pending Draw Down Notice. The Equity Credit Agreement contains customary representations, warranties and covenants by, among and for the benefit of the parties. Before Southridge is obligated to purchase any Shares pursuant to a Draw Down Notice, certain conditions specified in the Equity Credit Agreement, none of which are in Southridge's control, must be satisfied, including the following: Each of our representations and warranties in the Equity Credit Agreement must be true and correct in all material respects. We must have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required to be performed, satisfied or complied with by us. The registration statement of which this prospectus forms a part must be effective under the Securities Act. We must not have knowledge of any event that could reasonably be expected to have the effect of causing the suspension of the effectiveness of the registration statement of which this prospectus forms a part or the prohibition or suspension of the use of this prospectus. We must have filed with the Commission all required prospectus supplements relating to this prospectus and all periodic reports and filings required to be filed by us under the Exchange Act. Trading in our common stock must not have been suspended by the Commission, the OTCQB or the Financial Industry Regulatory Authority, or FINRA, there must not have been imposed, and we must not have received any notice of, any suspension of electronic trading or settlement services by The Depository Trust Company, and trading in securities generally on the OTCQB must not have been suspended or limited. We must have complied with all applicable federal, state and local governmental laws, rules, regulations and ordinances in connection with the execution, delivery and performance of the Equity Credit Agreement and the Registration Rights Agreement. No statute, regulation, order, decree, writ, ruling or injunction by any court or governmental authority of competent jurisdiction shall have been enacted, entered, promulgated, threatened or endorsed which prohibits the consummation of or which would materially modify or delay any of the transactions contemplated by the Equity Credit Agreement and the Registration Rights Agreement. No action, suit or proceeding before any arbitrator or any court or governmental authority shall have been commenced or threatened, and no inquiry or investigation by any governmental authority shall have been commenced or threatened seeking to restrain, prevent or change the transactions contemplated by the Equity Credit Agreement or the Registration Rights Agreement, or seeking material damages in connection with such transaction. The absence of any condition, occurrence, state of facts or event having, or insofar as reasonably can be foreseen would likely have, any effect on our business, operations, properties or financial condition that is material and adverse to us. There is no guarantee that we will be able to meet the foregoing conditions or any of the other conditions in the Equity Credit Agreement or that we will be able to draw down any portion of the Total Commitment available under the Equity Credit Agreement with Southridge. The obligations of Southridge under the Equity Credit Agreement to purchase shares of our common stock may not be transferred to any other party, and none of the terms or conditions contained in the Equity Credit Agreement may now be amended or waived by the parties. The registration statement of which this prospectus is a part will not cover sales by Southridge s transferees, notwithstanding Southridge s right to assign its rights under the Registration Rights Agreement to its affiliates. The Equity Credit Agreement may be terminated at any time by the mutual written consent of the parties. Unless earlier terminated, the Equity Credit Agreement will terminate automatically on the earliest to occur of (i) the first day of the month next following the 24-month anniversary of the effective date of the Registration Statement of which this prospectus is a part, (ii) the date on which Southridge purchases the Total Commitment worth of common stock under the Equity Credit Agreement and (iii) the date on which our common stock ceases to be listed or quoted on an eligible trading market under the Equity Credit Agreement. We may terminate the Equity Credit Agreement on one trading day s prior written notice to Southridge, subject to certain conditions, without fee, penalty or cost. Southridge may terminate the Equity Credit Agreement effective upon one trading day s prior written notice to us under certain circumstances, including the following: The existence of any condition, occurrence, state of facts or event having, or insofar as reasonably can be foreseen would likely have, any effect on our business, operations, properties or financial condition that is material and adverse to us. We enter into an agreement providing for certain types of financing transactions that are similar to the Equity Credit Agreement with Southridge. Certain transactions involving a change in control of the company or the sale of all or substantially all of our assets have occurred. We are in breach or default in any material respect under any of the provisions of the Equity Credit Agreement or the Registration Rights Agreement, and, if such breach or default is capable of being cured, such breach or default is not cured within 10 trading days after notice of such breach or default is delivered to us. While Southridge holds any shares issued under the Equity Credit Agreement, the effectiveness of the registration statement that includes this prospectus is suspended or the use of this Prospectus is suspended or prohibited, and such suspension or prohibition continues for a period of 20 consecutive trading days or for more than an aggregate of 60 trading days in any 365-day period, subject to certain exceptions. Trading in our common stock is suspended and such suspension continues for a period of five consecutive trading days or for more than an aggregate of 20 trading days in any 365-day period. We have filed for and/or are subject to any bankruptcy, insolvency, reorganization or liquidation proceedings. The Equity Credit Agreement provides that no termination of the Equity Credit Agreement will limit, alter, modify, change or otherwise affect any of the parties' rights or obligations with respect to any pending Draw Down Notice, and that the parties must fully perform their respective obligations with respect to any such pending Draw Down Notice under the Equity Credit Agreement, provided all of the conditions to the settlement thereof are timely satisfied. CALCULATION OF REGISTRATION FEE Amount of shares Proposed maximum Proposed maximum Amount of Title of each class of to be offering price aggregate Registration securities to be registered Registered per share (1) offering price Fee Common Stock, par value $0.001 per share, issuable pursuant to Equity Credit Agreement 1,324,339,645 (1) $ 0.0001 $ 132,433 $ 17.06 (1) This offering price has been estimated solely for the purpose of computing the registration fee in accordance with Rule 457(c) of the Securities Act on the basis of the average of the high and low prices of the common stock of the Company as reported on the Grey Market ( OTCQB ) on October 10, 2014. In the event of stock splits, stock dividends, or similar transactions involving the Registrant s common stock, the number of Shares registered shall, unless otherwise expressly provided, automatically be deemed to cover the additional securities to be offered or issued pursuant to Rule 416 promulgated under the Securities Act of 1933, as amended (the Securities Act ). We paid to Southridge a commitment fee for entering into the Equity Credit Agreement equal to $25,000 in the form of 55,555,556 Commitment Shares, calculated using a per share price of $0.0009, representing the lowest trade price of a share of our common stock during the three-trading day period immediately preceding the Closing Date. We also agreed to pay up to $25,000 of reasonable attorneys' fees and expenses (exclusive of disbursements and out-of-pocket expenses) incurred by Southridge in connection with the preparation, negotiation, execution and delivery of the Equity Credit Agreement and related transaction documentation. The Equity Credit Agreement also provides for indemnification of Southridge and its affiliates in the event that Southridge incurs losses, liabilities, obligations, claims, contingencies, damages, costs and expenses related to a breach by us of any of our representations and warranties under the Equity Credit Agreement or the other related transaction documents or any action instituted against Southridge or its affiliates due to the transactions contemplated by the Equity Credit Agreement or other transaction documents, subject to certain limitations. The issuance of the Commitment Shares and the sale of the Shares to Southridge under the Equity Credit Agreement are exempt from registration under the Securities Act pursuant to the exemption for transactions by an issuer not involving any public offering under Section 4(a)(2) of and Regulation D under the Securities Act. Registration Rights Agreement In connection with the execution of the Equity Credit Agreement, on the Closing Date, we and Southridge also entered into the Registration Rights Agreement. Pursuant to the Registration Rights Agreement, we agreed to file the registration statement of which this prospectus is a part with the Commission on or prior to the Filing Deadline to register 1,324,339,645 shares of our common stock, and have it declared effective prior to the Effectiveness Deadline. The effectiveness of the registration statement of which this prospectus is a part is a condition precedent to our ability to sell common stock to Southridge under the Equity Credit Agreement. We have agreed to file with the Commission one or more additional registration statements to cover all of the securities required to be registered under the Registration Rights Agreement that are not covered by this prospectus, in each case, as soon as practicable, but in no event later than the applicable filing deadline for such additional registration statements as provided in the Registration Rights Agreement. We also agreed, among other things, to indemnify Southridge from certain liabilities and fees and expenses of Southridge incident to our obligations under the Registration Rights Agreement, including certain liabilities under the Securities Act. Southridge has agreed to indemnify and hold harmless us and each of our directors, officers and persons who control us against certain liabilities that may be based upon written information furnished by Southridge to us for inclusion in the registration statement of which this prospectus is a part, including certain liabilities under the Securities Act. As discussed above, the obligations of Southridge under the Equity Credit Agreement to purchase shares of our common stock may not be transferred to any other party. Southridge may not assign its rights under the Registration Rights Agreement other than to an affiliate of Southridge. The registration statement of which this prospectus is a part will not cover sales by Southridge s transferees, notwithstanding Southridge s right to assign its rights under the Registration Rights Agreement to its affiliates. None of the terms or conditions contained in the Registration Rights Agreement may now be amended or waived by the parties. The foregoing description of the Equity Credit Agreement and the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Equity Credit Agreement and Registration Rights Agreement, copies of which have been filed or incorporated by reference as exhibits to the registration statement of which this prospectus is a part. PROSPECTUS 1,324,339,645 Shares of Common Stock XUMANII INTERNATIONAL HOLDINGS CORP. Common Stock This prospectus relates to the registration of up to 1,324,339,645 shares of our common stock. Our common stock is quoted on the Grey sheets, under the symbol XUII . The last reported sale price of our common stock on the OTCQB on October 10, 2014 was $0.0001 per share. INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE RISK FACTORS BEGINNING ON PAGE 12 OF THIS PROSPECTUS. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The information in this Prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission becomes effective. This Prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted or would be unlawful prior to registration or qualification under the securities laws of any such state. The date of this Prospectus is October 15, 2014. Corporate Information Our principal executive offices are located at 9550 South Eastern Ave. Suite 253-A86, Las Vegas, NV 89123. Our telephone number is 800-416-5934. We maintain the corporate website at www.imerjn.com. Stock Transfer Agent The Transfer Agent for our common stock is Empire Stock Transfer at 1859 Whitney Mesa Dr. Henderson, NV 89014. The agent s telephone number is (702) 818-5898. The Facility At any time and from time to time during the Commitment Period, the Company may deliver a Put Notice to Investor, subject to the conditions set forth in Section 7.2; provided, however, that the Investment Amount identified in the applicable Put Notice, when taken together with all prior Put Notices, shall not exceed the Maximum Commitment Amount. On the Put Date the Company shall deliver to Investor s brokerage account estimated put shares equal to the Investment Amount indicated in the Put Notice divided by the Closing Price on the Trading Day immediately preceding the Put Date, multiplied by one hundred twenty five percent (125%) (the Estimated Put Shares ). On the Trading Date immediately following delivery of the Estimated Put Shares, Investor shall deliver payment by check or wire transfer to the Company an amount equal to the par value of the Estimated Put Shares ( Par Value Payment ). In the event that, during a Valuation Period, the Closing Price on any Trading Day falls more than twenty five percent (25%) below the average of the closing trade prices for the ten (10) trading days immediately preceding the date of the Company s Put Notice (a Low Bid Price ), for each such Trading Day, the parties shall have no right and shall be under no obligation to purchase one tenth (1/10th) of the Investment Amount specified in the Put Notice, and the Investment Amount shall accordingly be deemed reduced by such amount. In the event that during a Valuation Period there exists a Low Bid Price for any three (3) Trading Days not necessarily consecutive then the balance of each party s right and obligation to purchase the Investment Amount under such Put Notice shall terminate on such second Trading Day ( Termination Day ), and the Investment Amount shall be adjusted to include only one-tenth (1/10th) of the initial Investment Amount for each Trading Day during the Valuation Period prior to the Termination Day that the Bid Price equals or exceeds the Low Bid Price. The Offering As of October 10, 2014, there were 6,077,232,853 shares of our common stock outstanding, of which 4,013,150,438 shares were held by non-affiliates. Although the Equity Credit Agreement provides that we may sell up to $5,000,000 of our common stock to Southridge, only 1,324,339,645 shares of our common stock are being offered under this prospectus. If all of the 1,324,339,645 shares offered under this prospectus were issued and outstanding as of October 10, 2014, such shares would represent approximately 26% of the total number of shares of our common stock outstanding and 33% of the total number of outstanding shares of our common stock held by non-affiliates, in each case as of October 10, 2014. At an assumed purchase price of $0.0001 (equal to the closing price of our common stock of $0.0001 on October 10, 2014), and assuming the sale by us to Southridge of all of the 1,324,339,645 Shares, or approximately 21.8% of our issued and outstanding common stock, being registered hereunder pursuant to draw downs under the Equity Credit Agreement, we would receive only approximately $132,433 in gross proceeds. Furthermore, we may receive substantially less than $132,433 in gross proceeds from the financing due to our share price, discount to market and other factors relating to our common stock. If we elect to issue and sell more than the 1,324,339,645 Shares offered under this prospectus to Southridge, which we have the right, but not the obligation, to do, we must first register for resale under the Securities Act any such additional Shares, which could cause additional substantial dilution to our stockholders. Based on the above assumptions, we would be required to register an additional approximately 48,675,660,355 shares of our common stock to obtain the balance of $5,000,000 of the Total Commitment that would be available to us under the Equity Credit Agreement. We currently have authorized and available for issuance 10,000,000,000 shares of our common stock pursuant to our charter. The number of shares of our common stock ultimately offered for resale by Southridge is dependent upon a number of factors, including the extent to which Southridge converts the Convertible Note into shares of our common stock and the number of Shares we ultimately issue and sell to Southridge under the Equity Credit Agreement. The Total Commitment of $5,000,000 was determined based on numerous factors, including our estimated operating expenses for the next 2 years. While it is difficult to estimate the likelihood that we will need the full Total Commitment, we presently believe that we may need the full Total Commitment under the Equity Credit Agreement. Common stock offered by Selling Stockholder 1,324,339,645 shares of common stock, Common stock outstanding before the offering 6,077,232,853 shares of common stock. Common stock outstanding after the offering 7,401,572,498 shares of common stock. Use of proceeds We may receive gross proceeds of up to $5,000,000 from the sale of Shares to Southridge pursuant to the Equity Credit Agreement. The net proceeds received from the sale of Shares pursuant to the Equity Credit Agreement will be used for general corporate and working capital purposes and acquisitions of assets, businesses or operations or for other purposes that our Board of Directors, in its good faith deem to be in the best interest of the company and its stockholders. OTCQB Trading Symbol XUII Risk Factors The common stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See Risk Factors . SELLING STOCKHOLDER This prospectus relates to the possible resale from time to time by the selling stockholder of any or all of the shares of common stock that have been or may be issued by us to Southridge under the Equity Credit Agreement. For additional information regarding the issuance of common stock covered by this prospectus, see Summary Recent Developments and Equity Credit Agreement With Southridge above. We are registering the shares of common stock pursuant to the provisions of the Registration Rights Agreement we entered into with Southridge on October 10, 2014, in order to permit the selling stockholder to offer the shares for resale from time to time. Except for the transactions contemplated by Equity Credit Agreement, and the Registration Rights Agreement, Southridge has not had any material relationship with us within the past three years. The table below presents information regarding the selling stockholder and the shares of common stock that it may offer from time to time under this prospectus. This table is prepared based on information supplied to us by the selling stockholder, and reflects holdings as of October 10, 2014. As used in this prospectus, the term selling stockholder means Southridge. The number of shares in the column Maximum Number of Shares of Common Stock to be Offered Pursuant to this Prospectus represents all of the shares of common stock that the selling stockholder may offer under this prospectus. The selling stockholder may sell some, all or none of its shares in this offering. We do not know how long the selling stockholder will hold the shares before selling them, and we currently have no agreements, arrangements or understandings with the selling stockholder regarding the sale of any of the shares. Beneficial ownership is determined in accordance with Rule 13d-3(d) promulgated by the SEC under the Exchange Act, and includes shares of common stock with respect to which the selling stockholder has voting and investment power. The percentage of shares of common stock beneficially owned by the selling stockholder prior to the offering shown in the table below is based on an aggregate of 6,077,232,853 shares of our common stock outstanding on October 10, 2014. Because the purchase price of the shares of common stock issuable under the Equity Credit Agreement is determined on each settlement date, the number of shares that may actually be sold by the Company under the Equity Credit Agreement may be fewer than the number of shares being offered by this prospectus. The fourth column assumes the sale of all of the shares offered by the selling stockholder pursuant to this prospectus. Name of Selling Stockholder Number of Shares of Common Stock Owned Prior to Offering Maximum Number of Shares of Common Stock to be Offered Pursuant to this Prospectus(3) Number of Shares of Common Stock Owned After Offering Number(1) Percent Number(4) Percent(2) Southridge (5) 0 0 % 1,324,339,645 1,324,339,645 22 % * Represents beneficial ownership of less than one percent of the outstanding shares of our common stock. (1) In accordance with Rule 13d-3(d) under the Exchange Act, we have excluded from the number of shares beneficially owned prior to the offering all of the shares that Southridge may be required to purchase pursuant to draw downs under the Equity Credit Agreement, because the issuance of such shares is solely at our discretion and is subject to certain conditions, the satisfaction of all of which are outside of Southridge s control, including the registration statement of which this prospectus is a part becoming and remaining effective. Furthermore, the maximum amount of each put of common stock to Southridge under the Equity Credit Agreement is subject to certain agreed upon threshold limitations set forth in the Equity Credit Agreement. Also, under the terms of the Equity Credit Agreement, we may not issue shares of our common stock to Southridge to the extent that Southridge or any of its affiliates would, at any time, beneficially own more than 9.99% of our outstanding common stock. (2) Applicable percentage ownership is based on 6,077,232,853 shares of our common stock outstanding as of October 10, 2014. (3) At an assumed average purchase price of $.0001, which is equal to the closing sale price of our common stock of on October 10, 2014, we would be required to issue a total of 50,000,000,000 shares of our common stock (or 48,675,660,355 shares in addition to those currently being registered hereby) to obtain the entire $5,000,000 Total Commitment under the Equity Credit Agreement. At an assumed average purchase price of $.0010, which is equal to 1,000% of the closing sale price of our common stock of $.0001 on October 10, 2014, we would be required to issue a total of 5,00,000,000 shares of our common stock (or 3,675,660.355 shares in addition to those currently being registered hereby) to obtain the entire $5,000,000 Total Commitment under the Equity Credit Agreement. Please see the section titled Equity Credit Agreement With Southridge elsewhere in this prospectus for a more detailed discussion of the number of shares we may be required to issue at various prices and the percentage of our outstanding shares that such shares would represent. (4) Assumes the sale of all shares being offered pursuant to this prospectus. (5) The business address of Southridge Partners is 90 Grove Street, Ste 206, Ridgefield, CT 06877. Southridge s principal business is that of a private investment firm. We have been advised that Southridge is not a member of the Financial Industry Regulatory Authority, or FINRA, or an independent broker-dealer, and that neither Southridge nor any of its affiliates is an affiliate or an associated person of any FINRA member or independent broker-dealer. We have been further advised that Steve Hicks is the Chief Executive Officer and managing member of Southridge and owns all of the membership interests in Southridge, and that Mr. Hicks has sole power to vote or to direct the vote and sole power to dispose or to direct the disposition of all securities owned directly by Southridge. Equity Credit Agreement On September 27, 2013, we entered into the Equity Credit Agreement with Southridge pursuant to which, we have the right, for a twenty-four-month period, commencing on the date of the Equity Credit Agreement (but not before the date which the SEC first declares effective this registration statement) (the Commitment Period ), of which this prospectus forms a part, registering the resale of the Put Shares by Southridge, to resell the Put Shares purchased by Southridge under the Equity Credit Agreement. As a condition for the execution of the Equity Credit Agreement, we issued 55,555,556 shares of our common stock to Southridge as a commitment fee and to cover legal expenses. In order to sell shares to Southridge under the Equity Credit Agreement, during the Commitment Period, the Company must deliver to Southridge a written put notice on any trading day (the Put Date ), setting forth the dollar amount to be invested by Southridge (the Put Notice ). For each share of our common stock purchased under the Equity Credit Agreement, Southridge will pay of the arithmetic average of the lowest VWAPs reported by Bloomberg Finance L.P. in a ten consecutive trading day period commencing with the date a put notice is delivered (the Valuation Period ). The Company may, at its sole discretion, issue a Put Notice to Southridge and Southridge will then be irrevocably bound to acquire such shares. The Equity Credit Agreement provides that the number of Put Shares to be sold to Southridge shall not exceed the number of shares that when aggregated together with all other shares of the Company s common stock which Southridge is deemed to beneficially own, would result in Southridge owning more than 4.99% of the Company s outstanding common stock. The Equity Credit Agreement provides that any provision of the Equity Credit Agreement may be amended or waived only by an instrument in writing signed by the party to be charged with enforcement. The Company and Southridge have entered into an enforceable oral agreement that neither will amend or waive any provision in the Equity Credit Agreement that alters the pricing mechanism or the 4.99% ownership cap which will result in the transaction becoming ineligible to be made on a shelf basis under Rule 415(a)(1)(i). If, during any Valuation Period, the Company (i) subdivides or combines the common stock; (ii) pays a dividend in shares of common stock or makes any other distribution of shares of common stock; (iii) issues any options or other rights to subscribe for or Debenture Shares of common stock and the price per share is less than closing price in effect immediately prior to such issuance; (iv) issues any securities convertible into shares of common stock and the consideration per share for which shares of common stock may at any time thereafter be issuable pursuant to the terms of such convertible securities shall be less that the closing price in effect immediately prior to such issuance; (v) issue shares of common stock otherwise than as provided in the foregoing subsections (i) through (iv) at a price per share less than the closing price in effect immediately prior to such issuance, or without consideration; or (vi) makes a distribution of its assets or evidences of its indebtedness to the holders of common stock as a dividend in liquidation or by way of return of capital or other than as a dividend payable out of earnings or surplus legally available for dividends under applicable law (collectively, a Valuation Event ), then a new Valuation Period shall begin on the trading day immediately after the occurrence of such Valuation Event and end on the fifth trading day thereafter. We are relying on an exemption from the registration requirements of the Securities Act and/or Rule 506 of Regulation D promulgated thereunder. The transaction does involve a private offering, Southridge is an accredited investor and/or qualified institutional buyer and Southridge has access to information about us and its investment. Assuming the sale of the entire $5,000,000 in Put Shares being registered hereunder pursuant to the Equity Credit Agreement, we will be able to receive $5,000,000 in gross proceeds. Neither the Equity Credit Agreement nor any rights or obligations of the parties under the Equity Credit Agreement may be assigned by either party to any other person. There are substantial risks to investors as a result of the issuance of shares of our common stock under the Equity Credit Agreement. These risks include dilution of stockholders, significant decline in our stock price and our inability to draw sufficient funds when needed. Southridge will periodically purchase our common stock under the Equity Credit Agreement and will, in turn, sell such shares to investors in the market at the market price. This may cause our stock price to decline, which will require us to issue increasing numbers of common shares to Southridge to raise the same amount of funds, as our stock price declines. SUMMARY OF FINANCIAL INFORMATION The following selected financial information is derived from the Company s Financial Statements appearing elsewhere in this Prospectus and should be read in conjunction with the Company s Financial Statements, including the notes thereto, appearing elsewhere in this Prospectus. Summary of Statements of Operations For the Year Ended July 31, 2013: Total revenue $ 0 Net loss $ (1,526,562 ) Net loss per common share (basic and diluted) $ (0.01 ) Weighted average common shares 271,610,552 For the Nine Months ended April 30, 2014 (unaudited): Total revenue $ 80 Net loss $ (1,806,158 ) Net loss per common share (basic and diluted) $ (0.01 ) Weighted average common shares 315,156,884 Statement of Financial Position (unaudited) April 30, 2014 Cash $ 200,149 Total current assets $ 788,876 Total assets $ 1,109,718 Total current liabilities $ 2,606,742 Stockholders deficit $ (1,497,024 ) Total liabilities and stockholders deficit $ 1,109,718
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+This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider in making your investment decision. You should read the following summary together with the entire prospectus, including the more detailed information regarding us, the common stock being sold in this offering and our consolidated financial statements and the related notes included elsewhere in this prospectus. You should carefully consider, among other things, the matters discussed in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this prospectus before deciding to invest in our common stock. Some of the statements in this prospectus constitute forward-looking statements. See "Forward-Looking Statements." Except where the context otherwise requires or where otherwise indicated, in this prospectus the terms "we," "us," "our," "our company" and "our business" refer to Veritex Holdings, Inc. and our wholly-owned banking subsidiary, Veritex Community Bank, a Texas state chartered bank, and the term "Bank" refers to Veritex Community Bank. Our Company We are a bank holding company headquartered in Dallas, Texas. Through our wholly-owned subsidiary, Veritex Community Bank, a Texas state chartered bank, we provide relationship-driven commercial banking products and services tailored to meet the needs of small to medium-sized businesses and professionals. Since our inception, we have targeted customers and focused our acquisitions primarily in the Dallas metropolitan area, which we consider to be Dallas and the adjacent communities in North Dallas. As we continue to grow, we expect to expand our primary market to include the broader Dallas-Fort Worth metropolitan area, which would include Fort Worth and Arlington, as well as the communities adjacent to those cities. We currently operate eight branches and one mortgage office, all of which are located in the Dallas metropolitan area. We have experienced significant organic growth since commencing banking operations in 2010 and have successfully acquired and integrated three banks. As of June 30, 2014, we had total assets of $710.4 million, total loans of $541.0 million, total deposits of $611.2 million and total stockholders' equity of $74.2 million. Our primary customers are small and medium-sized businesses, generally with annual revenues of under $30 million, and professionals. We believe that these businesses and professionals highly value the local decision-making and relationship-driven, quality service we provide and our deep, long-term understanding of the Dallas community and Texas banking. As a result of consolidation, we believe that there are few locally-based banks that are dedicated to providing this level of service to small and medium-sized businesses. Our management team's long-standing presence and experience in the Dallas metropolitan area gives us unique insight into our local market and the needs of our customers. This enables us to respond quickly to customers, provide high quality personal service and develop comprehensive, long-term banking relationships by providing products and services tailored to meet the individual needs of our customers. This focus and approach enhances our ability to continue to grow organically, successfully recruit talented bankers and strategically source potential acquisitions in our target market. Our History and Growth Our management team is led by our Chairman and Chief Executive Officer, C. Malcolm Holland, III, who has overseen and managed our organic growth and acquisition activity since we commenced banking operations in 2010. We have completed three whole-bank acquisitions that have increased our market presence within the Dallas metropolitan area. We have also grown organically by AMENDMENT NO. 3 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents compensation; and not to seek a non-binding advisory vote on executive compensation or golden parachute arrangements. We may choose to take advantage of some or all of these reduced reporting and other regulatory requirements. We have elected in this prospectus to take advantage of the reduced disclosure requirements relating to executive compensation arrangements. The JOBS Act also permits an "emerging growth company" to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. However, we have "opted out" of this provision. As a result, we will comply with new or revised accounting standards to the same extent that compliance is required for non-emerging growth companies. This decision to opt out of the extended transition period under the JOBS Act is irrevocable. Table of Contents opening two branches and a mortgage office in the Dallas metropolitan area. The following table summarizes our three acquisitions: Bank Acquired Date Completed Acquired Assets Acquired Loans Number of Branches Dallas Area Locations (Dollars in millions) Professional Bank, N.A. through Professional Capital, Inc. September 2010 $ 181.8 $ 91.7 3 Park Cities, Lakewood and Garland Fidelity Bank through Fidelity Resources Company March 2011 166.3 108.1 3 Preston Center, SMU and Plano Bank of Las Colinas October 2011 53.8 40.4 1 Las Colinas We have established a record of steady growth and profitable operations since commencing banking operations in 2010, as demonstrated below (total loans and deposits as of period-end and three year compound annual growth rate, or CAGR, through December 31, 2013), while preserving our strong credit culture. Our initial growth in 2010 and 2011 was primarily the result of our acquisitions. During 2012, 2013 and the first six months of 2014, we grew our total loans and deposits organically by increasing our commercial lending relationships and more deeply penetrating the Dallas metropolitan area. Veritex Holdings, Inc. (Exact Name of Registrant as Specified in Its Charter) Table of Contents FORWARD-LOOKING STATEMENTS Forward-looking statements included in this prospectus are based on various facts and derived utilizing numerous important assumptions and are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements include the information concerning our future financial performance, business and growth strategy, projected plans and objectives, as well as projections of macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Statements preceded by, followed by or that otherwise include the words "believes," "expects," "anticipates," "intends," "projects," "estimates," "plans" and similar expressions or future or conditional verbs such as "will," "should," "would," "may" and "could" are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. You should understand that the following important factors could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements: risks related to the concentration of our business within the Dallas metropolitan area, including risks associated with any downturn in the real estate sector and risks associated with a decline in the values of single family homes in the Dallas metropolitan area; our ability to implement our growth strategy, including identifying and consummating suitable acquisitions; risks related to the integration of any acquired businesses, including exposure to potential asset quality and credit quality risks and unknown or contingent liabilities, the time and costs associated with integrating systems, technology platforms, procedures and personnel, the need for additional capital to finance such transactions, and possible failures in realizing the anticipated benefits from acquisitions; our ability to recruit and retain successful bankers that meet our expectations in terms of customer relationships and profitability; our ability to retain executive officers and key employees and their customer and community relationships; risks associated with our limited operating history and the relatively unseasoned nature of a significant portion of our loan portfolio; market conditions and economic trends nationally, regionally and particularly in the Dallas metropolitan area and Texas; risks related to our strategic focus on lending to small to medium-sized businesses; the sufficiency of the assumptions and estimates we make in establishing reserves for potential loan losses; risks associated with our commercial loan portfolio, including the risk for deterioration in value of the general business assets that generally secure such loans; risks associated with our nonfarm nonresidential and construction loan portfolios, including the risks inherent in the valuation of the collateral securing such loans; potential changes in the prices, values and sales volumes of commercial and residential real estate securing our real estate loans; risks related to the significant amount of credit that we have extended to a limited number of borrowers and in a limited geographic area; Table of Contents Our Strategy Our business strategy is comprised of the following components: Organic Growth in Thriving Dallas Metropolitan Area. Our organic growth strategy has focused on more deeply penetrating the Dallas metropolitan area through our community-focused, relationship-driven approach to banking. We believe that our current market area provides abundant opportunities to continue to grow our customer base, increase loans and deposits and expand our overall market share. Our team of seasoned bankers has been an important driver of our organic growth by further developing banking relationships with current and potential customers, many of which span more than 20 years. Our market presidents and relationship managers are incentivized to increase the size of their loan and deposit portfolios and generate fee income while maintaining strong credit quality. We intend to add to our team of experienced bankers in order to grow our current footprint and expand further into markets throughout the Dallas-Fort Worth metropolitan area. Preserving sound credit underwriting standards as we grow our loan portfolio will continue to be the foundation of our organic growth strategy. Acquisitions. We intend to continue to grow through acquisitions, and we believe having publicly traded common stock will improve our ability to compete for acquisitions. Many small to medium-sized banking organizations in the Dallas-Fort Worth metropolitan area face significant scale and operational challenges, regulatory pressure, management succession issues and shareholder liquidity needs. There were 59 banks headquartered in this area with less than $500 million of assets, which collectively held approximately $11.0 billion in assets, as of June 30, 2014, according to the FDIC. As a result, we believe that there will continue to be attractive acquisition opportunities in the Dallas-Fort Worth metropolitan area as well as in other attractive markets in Texas. Although we have no current plans, arrangements or understandings to make any material acquisitions, this market dynamic will afford us opportunities to identify and execute acquisitions designed to strengthen our franchise and increase shareholder value. Improve Operational Efficiency and Increase Profitability. We are committed to maintaining and enhancing profitability. Our net income increased from $109,000 in 2011 to $3.4 million in 2013 and our efficiency ratio improved from 92.2% in 2011 to 69.8% in 2013. For the six months ended June 30, 2014, our net income was $2.2 million compared to $1.5 million for the six months ended June 30, 2013. We employ a systematic and calculated approach to improving our operational efficiency, which in turn we believe increases our profitability. We have upgraded our operating capabilities and created a platform for continued efficiencies in the areas of technology, data processing, regulatory compliance and human resources. We believe that our scalable infrastructure and efficient operating platform will allow us to achieve continued growth without incurring significant incremental noninterest expenses and will enhance our returns. Continue to Build Our Community Ties. Our officers and employees are heavily involved in civic and community organizations, and we sponsor numerous activities that benefit our community. Our business development strategy, which focuses on building market share through personal relationships, as opposed to formal advertising, is consistent with our customer-centric culture and is a cost-effective approach to developing new relationships and enhancing existing ones. Our Competitive Strengths We believe our competitive strengths include the following: Experienced Senior Management Team. Our Chairman and Chief Executive Officer, C. Malcolm Holland, III, and our Vice Chairman, William C. Murphy, have more than 75 years of combined experience acquiring, growing and selling banks in the Dallas metropolitan area. Messrs. Holland Texas (State or Other Jurisdiction of Incorporation or Organization) 6022 (Primary Standard Industrial Classification No.) 27-0973566 (I.R.S. Employer Identification No.) 8214 Westchester Drive, Suite 400 Dallas, Texas 75225 (972) 349 - 6200 (Address, Including Zip Code, of Registrant's Principal Executive Offices) C. Malcolm Holland, III Chairman and Chief Executive Officer Veritex Holdings, Inc. 8214 Westchester Drive, Suite 400 Dallas, Texas 75225 (972) 349 - 6200 (Name, Address and Telephone Number, Including Area Code, of Agent For Service) Table of Contents our ability to maintain adequate liquidity and to raise necessary capital to fund our acquisition strategy and operations or to meet increased minimum regulatory capital levels; changes in market interest rates that affect the pricing of our loans and deposits and our net interest income; potential fluctuations in the market value and liquidity of our investment securities; the effects of competition from a wide variety of local, regional, national and other providers of financial, investment and insurance services; our ability to maintain an effective system of disclosure controls and procedures and internal controls over financial reporting; risks associated with fraudulent and negligent acts by our customers, employees or vendors; our ability to keep pace with technological change or difficulties when implementing new technologies; risks associated with system failures or failures to prevent breaches of our network security; risks associated with data processing system failures and errors; potential impairment on the goodwill we have recorded or may record in connection with business acquisitions; the institution and outcome of litigation and other legal proceeding against us or to which we become subject; our ability to comply with various governmental and regulatory requirements applicable to financial institutions; the impact of recent and future legislative and regulatory changes, including changes in banking, securities and tax laws and regulations and their application by our regulators, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the Dodd-Frank Act; governmental monetary and fiscal policies, including the policies of the Board of Governors of the Federal Reserve System, or the Federal Reserve; our ability to comply with supervisory actions by federal and state banking agencies; changes in the scope and cost of Federal Deposit Insurance Corporation, or the FDIC, insurance and other coverage; and systemic risks associated with the soundness of other financial institutions. Other factors not identified above, including those described under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations," may also cause actual results to differ materially from those described in our forward-looking statements. Most of these factors are difficult to anticipate and are generally beyond our control. You should consider these factors in connection with considering any forward-looking statements that may be made by us. We undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events unless we are required to do so by law. Table of Contents and Murphy have worked together in three different banking institutions during seven of the past 17 years. Mr. Holland began his banking career in 1982, and in 1986 was an organizer and leader of EastPark National Bank, Dallas, until it was acquired by Fidelity Bank of Dallas in 1995, which, at that time, was led by Mr. Murphy. Mr. Holland then assumed the primary lending and business development role at Fidelity Bank of Dallas until it was acquired by Compass Bank in 1998. In 2000, Mr. Holland became President of First Mercantile Bank, where, through a combination of an acquisition and organic growth, the bank grew from $125.0 million to $325.0 million in total assets over a two-year period. When Colonial Bank acquired First Mercantile Bank in 2002, Mr. Holland assumed the role of Chief Executive Officer for the Texas Region of Colonial Bank, overseeing the management and organic growth of the region from $625.0 million in assets in 2002 to over $1.6 billion in assets in 2009. Mr. Murphy began his banking career in 1971 and has been Chairman or Chief Executive Officer of several community banks in the Dallas metropolitan area, including Parkway National Bank, Mercantile Bank & Trust and Fidelity Bank of Dallas, and was instrumental in the growth and leadership of these institutions. Mr. Murphy has led financial institutions in over 25 transactions involving the acquisition, formation or sale of banks, bank holding companies or individual branches. In addition to Messrs. Holland and Murphy, we believe we have significant depth in management throughout each function of our organization, including lending, credit administration, treasury services, finance, operations, information technology, regulatory compliance and risk management. Our bankers also have significant experience, with eight of our market presidents and relationship managers having more than 25 years of banking experience in the Dallas metropolitan area. Our team has a demonstrated track record of achieving profitable growth, successfully executing acquisitions, maintaining a strong credit culture, and implementing a community-focused, relationship-driven approach to banking. The depth of our team's market knowledge and long-term relationships in the Dallas metropolitan area are the keys to our strong successful referral business. Strong Brand and Reputation in Our Market. The name "Veritex" is derived from a combination of the Latin root word "veritas," meaning truth, and "Texas," and we strive to provide truth in Texas banking every day. We have developed a reputation as an active lender in our community. The members of our management team have spent the majority of their careers as bankers in the Dallas metropolitan area. We believe that our strong brand and market reputation have become and will remain a competitive advantage within our market. By capitalizing on the business and personal relationships of our senior management team, market presidents and relationship managers, we believe that we are positioned for continued growth and increased profitability. Loyal and Growing Core Deposit Franchise. Developing significant deposit relationships with our borrowers is a key component of our growth strategy. Our core deposits, which include all demand deposits, money market and savings accounts and time deposits under $250,000, but exclude all brokered deposits, represented approximately 90.7% of our deposits as of June 30, 2014, 93.5% of our deposits as of December 31, 2013 and 95.0% of our deposits as of December 31, 2012. Our customers maintain significant noninterest-bearing deposits with us, which contributes to our lower cost of funds. Noninterest-bearing deposits represented 38.7%, 38.2% and 38.1% of our total deposits as of June 30, 2014, December 31, 2013 and December 31, 2012, respectively. Our cost of funds was 48 basis points for the first six months of 2014, 44 basis points for 2013, and 56 basis points for 2012. Our strong, low-cost deposit base Copies to: William S. Anderson Jason M. Jean Bracewell & Giuliani LLP 711 Louisiana, Suite 2300 Houston, Texas 77002 (713) 223-2300 (713) 437-5370 (facsimile) Sanford M. Brown Justin M. Long Bracewell & Giuliani LLP 1445 Ross Avenue, Suite 3800 Dallas, Texas 75202 (214) 468-3800 (214) 758-8300 (facsimile) Chet A. Fenimore Geoffrey S. Kay Fenimore, Kay, Harrison & Ford, LLP 812 San Antonio Street, Suite 600 Austin, Texas 78701 (512) 583-5900 (512) 583-5940 (facsimile) Table of Contents serves as a major driver of our operating results, as we utilize our core deposit base primarily to fund our loan growth. Our total deposits grew by 28.1% in 2013 and 22.8% in 2012, while our noninterest-bearing deposits grew by 28.4% in 2013 and 51.3% in 2012. Total deposits grew by 13.0% and non-interest bearing deposits grew by 15.7% during the first six months of 2014 on an annualized basis. We believe that our ability to grow strong core deposits is a unique and valuable competitive advantage. Proven Ability and Demonstrated Success in Acquisitions and Integration. We have completed three whole-bank acquisitions since the beginning of 2010 and only two other Texas-based banking institutions have completed more acquisitions in Texas during that period, according to SNL Financial. As a result, we believe we have developed an experienced and disciplined acquisition and integration approach capable of identifying candidates, conducting thorough due diligence, determining financial attractiveness, and integrating the acquired institution. Utilizing the prior experience of our management team at larger financial institutions, we believe that we have built a corporate infrastructure capable of supporting additional acquisitions and continued organic growth. We believe our acquisition experience and our reputation as a successful acquirer position us to capitalize on additional opportunities in the future. Strong Credit Culture. Our disciplined implementation of comprehensive policies and procedures for credit underwriting and administration has enabled us to maintain strong asset quality during our growth. We manage the risk in the portfolio with prudent underwriting and proactive credit administration. Mr. Murphy, our Vice Chairman, who leads the Bank directors' loan committee, has more than 40 years of banking experience. Our nonperforming assets to total assets ratio was 0.42% as of June 30, 2014, 0.44% as of December 31, 2013 and 0.71% as of December 31, 2012, while our net charge-offs to average loans outstanding was 0.04% during the first six months of 2014, 0.02% during 2013 and 0.21% during 2012. As much of the growth in our loan portfolio is attributed to new loans with which we have limited experience and payment history, a portion of our loan portfolio is considered to be relatively unseasoned. Scalable Platform. Throughout our operating history, we have built and maintained a strong and scalable banking platform to support our dynamic growth. Utilizing the significant prior experience of our management team and employees, we believe that we have built a scalable corporate infrastructure, including technology and banking processes, capable of supporting future organic growth and acquisitions while improving our operational efficiencies. We believe that our strong capital and asset quality position will allow us to grow and our scalable operating platform will allow us to manage that growth effectively, resulting in greater efficiency and improved profitability. This increased efficiency has been demonstrated by the improvement in our efficiency ratio from 92.2% in 2011 to 69.8% in 2013. Our Market Area We currently operate in the Dallas metropolitan area, which is part of the broader Dallas-Fort Worth-Arlington metropolitan statistical area, which we refer to as the Dallas-Fort Worth metropolitan area. The Dallas economy is fueled by the real estate, technology, financial services, insurance, transportation, manufacturing, health care and energy sectors. This market is among the most vibrant in the United States with a rapidly growing population, a high level of job growth, an affordable cost of living and a pro-growth business climate. More broadly, Texas is also experiencing significant population and employment growth on a statewide basis. A Leading Population Growth Center. The Dallas-Fort Worth metropolitan area is the fourth largest metropolitan area in the nation by population, behind only New York City, Los Angeles and Chicago, based on data from the United States Census Bureau. Population in this area is projected to grow by 8.6% from 2014 to 2019, compared to 3.5% for the nation as a whole, Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 under the Exchange Act. (check one) Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered(1) Proposed Maximum Offering Price Per Share(2) Proposed Maximum Aggregate Offering Price(2)(3) Amount of Registration Fee Common Stock, $0.01 par value per share 3,105,000 $14.00 $43,470,000 $5,598.94(4) (1)Includes 405,000 shares subject to the underwriters' option to purchase additional shares. (2)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(a) under the Securities Act of 1933, as amended. (3)Includes the offering price of any additional shares of common stock that the underwriters' have the option to purchase. (4)This fee was previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file an amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents according to SNL Financial. Texas is the second most populous state in the United States and its population is projected to grow by 7.6% from 2014 to 2019, according to SNL Financial. Robust Employment Growth. The Dallas-Fort Worth metropolitan area had the highest percentage of employment growth of the 12 most populous metropolitan areas in the United States during the 12 months ended April 30, 2014, according to the U.S. Bureau of Labor Statistics. The area's unemployment rate was 5.5% in July 2014, according to the U.S. Bureau of Labor Statistics. Texas led the nation in job growth for the period from 2000 to 2013, according to the Federal Reserve Bank of Dallas. Fortune 500 Companies. The Dallas-Fort Worth metropolitan area serves as the corporate headquarters for numerous Fortune 500 companies across many varied industries, including ExxonMobil, AT&T, American Airlines, Fluor, Kimberly-Clark, HollyFrontier, Southwest Airlines, Texas Instruments, Neiman-Marcus, Tenent Healthcare, JCPenney, Dean Foods, GameStop, Energy Transfer Equity, Commercial Metals, Celanese, D.R. Horton, Dr Pepper Snapple Group and Energy Future Holdings. Other major companies have recently announced significant relocations or expansions in the area, such as Toyota, which announced the relocation of its North American headquarters, and State Farm, which announced a major expansion of its regional hub. On a statewide basis, Texas is home to the corporate headquarters of 52 Fortune 500 companies. Numerous Small and Medium-Sized Businesses. Our primary customers are small and medium-sized businesses and professionals. Small and medium-size businesses are a vital part of the Dallas-Fort Worth metropolitan area. With more than 140,000 businesses that employ less than 100 people, representing approximately 97.0% of total businesses, the Dallas-Fort Worth metropolitan area ranks fifth in the United States in number of businesses employing less than 100 people, according to United States Census Bureau data for 2012 released in May 2014. World Class Hospitals and Universities. The Dallas-Fort Worth metropolitan area contains several world-class hospitals and medical research facilities, major universities, and professional sports franchises. Third Quarter 2014 Update We expect to report net income in the range of $1.3 million to $1.4 million for the three months ended September 30, 2014 as compared to $1.2 million for the three months ended June 30, 2014 and $952,000 for the three months ended September 30, 2013. We also expect to report net income in the range of $3.4 million to $3.5 million for the nine months ended September 30, 2014 as compared to $2.4 million for the nine months ended September 30, 2013. The increase in net income for these periods is primarily attributable to growth in outstanding loan balances and a corresponding increase in net interest income. As of September 15, 2014, total loans were $576.3 million, representing a $125.8 million increase from September 30, 2013 and a $35.3 million increase from June 30, 2014. Total deposits were $619.9 million as of September 15, 2014 representing an increase of $104.8 million from September 30, 2013, and an $8.7 million increase from June 30, 2014. Increases in our total loans and total deposits were largely driven by execution of our strategy and continued focus on strengthening and developing new and existing customer relationships in our market area. Our expected net income for the three and nine month periods ending September 30, 2014 are preliminary estimates and subject to closing procedures, which we expect to complete after the completion of this offering. These closing procedures could result in material changes to our preliminary estimates indicated above. The foregoing estimates constitute forward-looking statements and are subject to risks and uncertainties, including those described under "Risk Factors" in this Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion, Dated October 2, 2014 PROSPECTUS 2,700,000 Shares Veritex Holdings, Inc. Common Stock Table of Contents prospectus. Accordingly, our final results for the three and nine month periods ending September 30, 2014 may not be consistent with the foregoing estimates. See "Risk Factors Risks Related to Our Business" and "Forward-Looking Statements." Our Corporate Information Our principal executive offices are located at 8214 Westchester Drive, Suite 400, Dallas, Texas 75225, and our telephone number is (972) 349-6200. Our website is www.veritexbank.com. The information contained on or accessible from our website does not constitute a part of this prospectus and is not incorporated by reference herein. This is the initial public offering of shares of common stock of Veritex Holdings, Inc., the holding company for Veritex Community Bank, a Texas state chartered bank headquartered in Dallas, Texas. We are offering 2,700,000 shares of our common stock. No public market currently exists for our common stock. We have applied to list our common stock on the NASDAQ Global Market under the symbol "VBTX." We anticipate that the initial public offering price per share of our common stock will be between $12.00 and $14.00. We are an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, and are subject to reduced public company disclosure standards. Investing in our common stock involves risks. See "Risk Factors" beginning on page 13 of this prospectus to read about factors you should consider before investing in our common stock. Per share Total Initial public offering price of our common stock $ $ Underwriting discounts and commissions Proceeds, before expenses, to us(1) Table of Contents The Offering Common stock we are offering 2,700,000 shares (3,105,000 shares if the underwriters exercise their option to purchase additional shares in full). Common stock to be outstanding after this offering 9,058,832 shares (9,463,832 shares if the underwriters exercise their option to purchase additional shares in full). Use of proceeds We estimate that our net proceeds from the sale of the shares of common stock by us will be approximately $30.8 million, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us, based on an assumed initial public offering price of $13.00 per share, which is the midpoint of the estimated initial public offering price range set forth on the cover page of this prospectus. If the underwriters exercise their option to purchase additional shares in full, the net proceeds to us will be approximately $35.7 million. We intend to use the net proceeds to us from this offering to support our continued growth, including organic growth and potential future acquisitions, and for general corporate purposes. See "Use of Proceeds." Dividend policy We have not declared or paid any dividends on our common stock. We currently intend to retain all of our future earnings, if any, for use in our business and do not anticipate paying any cash dividends on our common stock in the foreseeable future. See "Dividend Policy." Directed share program At our request, the underwriters have reserved up to 135,000 shares of our common stock offered by this prospectus, for sale, at the initial public offering price, to our directors, executive officers, employees and certain other persons who have expressed an interest in purchasing our common stock in this offering. The number of shares available for sale to the general public in the offering will be reduced to the extent these persons purchase the reserved shares. Any reserved shares not so purchased will be offered by the underwriters to the general public on the same terms as the other shares. Registration and Board Rights We have entered into a registration rights agreement with SunTx Veritex Holdings, L.P., or SunTx, and WCM Parkway, Ltd., two of our largest shareholders, pursuant to which such shareholders will have the ability to cause us to register the resale of their shares. Such shareholders have agreed with the underwriters not to exercise such rights for a period of at least 180 days from the date of this prospectus. SunTx also has the right to nominate one representative to serve on our board of directors for so long as they hold at least 4.9% of our common stock. See "Certain Relationships and Related Party Transactions Registration Rights Agreement" and " Agreements with SunTx Veritex Holdings, L.P." (1)See "Underwriting" for additional information regarding the underwriting discounts and commissions and certain expenses payable to the underwriters by us. We have granted the underwriters the option to purchase up to an additional 405,000 shares of our common stock from us within 30 days of the date of this prospectus on the same terms and conditions set forth above, to cover over allotments, if any. Neither the Securities and Exchange Commission, any state securities commission, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, the Texas Department of Banking nor any other regulatory authority has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. These securities are not deposits, savings accounts or other obligations of any bank or savings association and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency and are subject to investment risks, including the possible loss of the entire amount you invest. The underwriters expect to deliver the shares to purchasers on or about , 2014, subject to customary closing conditions. Sandler O'Neill + Partners, L.P. Stephens Inc. Sterne Agee Except as otherwise indicated, all of the information in this prospectus: assumes no exercise of the underwriters' option to purchase up to 405,000 additional shares of common stock from us; excludes 357,500 shares of common stock issuable upon the exercise of outstanding time-based options at a weighted average exercise price of $10.15 per share (181,200 shares of which were exercisable), as of June 30, 2014; excludes 472,500 shares of common stock issuable upon the exercise of performance-based options at a weighted average exercise price of $10.15 per share (none of which were exercisable), as of June 30, 2014, which we intend to cancel prior to the completion of this offering as described in "Executive Compensation 2014 Omnibus Incentive Plan"; excludes approximately 100,000 restricted stock units (based on an initial public offering price of $13.00 per share, which is the midpoint of the estimated initial public offering price range set forth on the cover page of this prospectus) that we intend to grant prior to the completion of this offering in connection with the cancelation of our performance-based options, as described in "Executive Compensation 2014 Omnibus Incentive Plan"; excludes 63,250 shares of common stock underlying outstanding restricted stock units that were not fully vested as of June 30, 2014; excludes 25,000 shares of our common stock issuable upon exercise of warrants at an exercise price of $11.00 per share as of June 30; does not attribute to any director, executive officer or principal shareholder any purchase of shares of our common stock in the offering, including through the directed share program described in "Underwriting Directed Share Program;" and assumes an initial offering price of $13.00 per share, which is the midpoint of the estimated initial public offering price range set forth on the cover page of this prospectus. The date of this prospectus is , 2014 Table of Contents
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+PROSPECTUS SUMMARY This summary highlights information contained in other parts of this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in shares of our common stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this prospectus. You should read the entire prospectus carefully, especially Risk Factors and our consolidated financial statements and the related notes, before deciding to buy shares of our common stock. Unless the context requires otherwise, references in this prospectus to Lumena, we, us and our refer to Lumena Pharmaceuticals, Inc. Overview We are a biopharmaceutical company focused on the development and commercialization of novel products for rare cholestatic liver diseases and serious metabolic disorders, such as nonalcoholic steatohepatitis, or NASH, where there is a high unmet medical need. We are developing two clinical-stage product candidates, LUM001 and LUM002, that inhibit the apical sodium-dependent bile acid transporter, or ASBT, which is primarily responsible for recycling bile acids from the intestine to the liver. Our product candidates have the potential to treat orphan and more prevalent liver diseases for which there currently are limited therapeutic options. Preclinical and clinical data suggest that blocking bile acid transport and reducing bile acid reabsorption with ASBT inhibitors, such as LUM001 and LUM002, has the potential to slow disease progression, improve liver function and enhance the quality of life for patients suffering from cholestatic liver diseases and NASH. Our Product Pipeline We have seven ongoing or planned Phase 2 clinical trials of LUM001, four of which are in Alagille syndrome, or ALGS, and one planned Phase 2 clinical trial of LUM002. The following chart depicts key information regarding our product candidates, their indications, and their current stages of development: Table of Contents The Role of Bile Acids and ASBT Bile acids facilitate the absorption of dietary cholesterol, fat and fat-soluble vitamins and are increasingly being recognized as signaling molecules that regulate metabolic processes. Bile acids are synthesized in the liver and stored in the gall bladder. They are released into the gastrointestinal, or GI, tract, typically in response to the ingestion of food. ASBT is present in the distal, or lower, portion of the small intestine where it mediates the uptake of bile acids across the intestinal cell membrane. ASBT, together with other transporters and proteins, recycles bile acids from the GI tract back to the liver via the portal vein. When bile and cholesterol equilibrium, or homeostasis, is disrupted, bile acids can accumulate in the liver and are associated with significant liver damage and pruritus, or itching. Inhibiting ASBT results in more bile acids being excreted in the feces and reduced bile acids returning to the liver. Bile acids are also potent signaling agents which can bind to specific receptors in the colon and stimulate the release of proteins involved in metabolic control. ASBT inhibition has been shown to reduce cholesterol levels and improve metabolic parameters, including insulin resistance and blood glucose levels, and could therefore be effective in addressing NASH. LUM001 An ASBT inhibitor in development for the treatment of cholestatic liver diseases Our lead product candidate, LUM001, is a novel, once-daily, orally-administered, potent and selective ASBT inhibitor, which reduces bile acid intestinal absorption leading to an increase in bile acid excretion and lower levels of bile acids in the liver and systemic circulation. LUM001 is currently in Phase 2 clinical development in children for the treatment of orphan cholestatic liver diseases including ALGS and progressive familial intrahepatic cholestasis, or PFIC. Based on consultation with regulatory authorities, we expect to file for regulatory approval for LUM001 in ALGS and PFIC utilizing the results from our planned and ongoing pediatric Phase 2 trials. LUM001 is also in Phase 2 clinical development in adults for the treatment of primary biliary cirrhosis, or PBC, and primary sclerosing cholangitis, or PSC. Pending successful completion of our Phase 2 clinical trials and input from regulatory authorities, we plan to initiate a Phase 3 development program in these indications to support regulatory approval. We have developed a proprietary liquid formulation of LUM001 for children and a tablet formulation of LUM001 for adults. Cholestatic liver diseases, including ALGS, PFIC, PBC and PSC, are characterized by elevated bile acids and pruritus, which is generally the most debilitating symptom afflicting children and adults with these diseases. Surgical intervention, which lowers bile acid levels, has been shown to relieve pruritus symptoms and slow disease progression in these patients, but is associated with significant complications. By reducing serum bile acids, LUM001 may offer a novel therapeutic approach to alleviate the pruritus and progressive liver damage associated with cholestatic liver diseases. There are no approved therapies for the treatment of patients with ALGS, PFIC or PSC in the United States. Cholestyramine (Questran ) is only modestly effective at lowering bile acid levels and slowing progressive liver disease because patients generally cannot tolerate a high enough dosage to realize the full therapeutic benefit. Ursodeoxycholic acid (ursodiol), or UDCA, is approved for the treatment of PBC, but only 20-30% of patients with PBC fully respond to treatment with UDCA, and the rest eventually develop cirrhosis and liver failure. In children with ALGS and PFIC, in particular, invasive partial external biliary diversion surgery, or PEBD surgery, is often used to lower circulating bile acid concentrations. Such surgical procedures are associated with significant complications. We believe that there is a significant unmet medical need for a safe, effective and non-invasive treatment alternative for patients with cholestatic liver disease. Table of Contents Based on published industry data, we estimate the prevalence of these orphan cholestatic liver diseases in the table below, as well as the initial addressable market for LUM001, which consists of patients with moderate to severe pruritus who have not undergone PEBD surgery or a liver transplant: Prevalence of Orphan Cholestatic Liver Diseases United States European Union Prevalence Rate Prevalence Initial Addressable Market Prevalence Rate Prevalence Initial Addressable Market ALGS 3/100,000 9,500 2,850 3/100,000 15,000 4,500 PFIC 1/100,000 3,000 900 2/100,000 10,000 3,000 PBC 40/100,000 125,000 20,000 30/100,000 150,000 24,000 PSC 14/100,000 45,000 9,000 3/100,000 15,000 3,000 LUM001 was designed to be minimally absorbed into the systemic circulation, thereby minimizing potential safety concerns. It has been extensively studied through administration to more than 1,400 human subjects in 12 completed clinical trials evaluating the product candidate as a treatment for elevated cholesterol levels. Our product candidate demonstrated a favorable safety profile and an ability to reduce serum bile acid levels in clinical trials to date. We are currently conducting or expect to initiate seven Phase 2 clinical trials of LUM001 in North America and Europe. We expect to obtain data from several of these trials over the course of the next year, beginning with Phase 2 results in ALGS by the second half of 2014, followed by Phase 2 results in PFIC and PBC by late 2014 or early 2015. LUM001 has been granted orphan drug designation for ALGS, PFIC, PBC and PSC in the United States and the European Union, providing the opportunity to receive 7 years of market exclusivity in the United States and 10 years of market exclusivity in the European Union, which can be extended to 12 years in the European Union if trials are conducted in accordance with an agreed-upon pediatric investigational plan. LUM002 An ASBT inhibitor in development for the treatment of NASH Our second product candidate, LUM002, is a novel, once-daily, orally-administered, highly potent and selective ASBT inhibitor in development for the treatment of NASH, a condition characterized by fat deposits in the liver, leading to inflammation and significant fibrosis. While the underlying cause of liver injury in NASH is not known, it is strongly associated with obesity, type 2 diabetes, high cholesterol and triglycerides and other metabolic disorders. By blocking bile acid reabsorption, we expect LUM002 to reduce hepatic cholesterol levels and increase colonic bile acid concentrations. Elevated colonic bile acids signal through receptors on cells in the distal portion of the large intestine. This signaling stimulates the secretion of proteins that regulate insulin release from the pancreas and glucose metabolism. We believe that therapeutic strategies aimed at modulating insulin resistance and normalizing lipoprotein metabolism have significant potential to benefit patients with NASH. LUM002 has been evaluated in two completed Phase 1 clinical trials in healthy volunteers and metabolic disease patients, and we plan to initiate a Phase 2 clinical trial in NASH patients in the second half of 2014. NASH represents a substantial unmet medical need. According to the National Digestive Diseases Information Clearinghouse, 2-5% of Americans, or 6 million to 16 million individuals, suffer from this disease, of which an estimated 600,000 have been identified as having severe liver disease, which we view as the initial addressable market for LUM002. In Western countries as a whole, industry sources estimate that NASH affects 2-3% of the general population, equating to an additional 10 million to 15 million individuals in Europe. NASH is becoming more common, largely believed to be related to the widespread increase in obesity. From 1980 to 2010, the rate of obesity in the United States alone has more than doubled in adults and more than tripled in children and is expected to increase by an additional 33% over the next two decades. Globally, the rate of obesity Table of Contents has also nearly doubled since 1980 and is expected to double again by 2030 if nothing is done to reverse the epidemic. NASH is one of the main causes of liver cirrhosis, behind hepatitis C and alcoholic liver disease, and is the fastest growing cause of liver transplantation in the United States. Despite the rapidly increasing incidence of NASH, there are no therapies currently approved for the treatment of this common liver disorder. Based on the favorable clinical profiles of LUM001 and LUM002, we believe we are well positioned to significantly change the treatment paradigm for orphan cholestatic liver diseases as well as NASH. Each of these product candidates represents a highly attractive commercial opportunity. We intend to establish commercialization and marketing capabilities in North America for LUM001 and pursue strategic partnerships in other territories. We intend to seek strategic partnerships to accelerate the broader clinical development and commercialization of LUM002 in NASH and other metabolic diseases. We have exclusive worldwide rights to both of our product candidates. Our Strategy Our goal is to be a leader in the treatment of rare cholestatic liver diseases and serious metabolic disorders of the liver where there is a high unmet medical need. The key components of our strategy include: Pursue rapid development and regulatory approval for our lead product candidate, LUM001, in ALGS and PFIC in children. We expect to complete our ongoing and planned Phase 2 clinical trials in ALGS to support the filing of a new drug application, or NDA, with the U.S. Food and Drug Administration, or FDA, and a marketing authorization application, or MAA, with the European Medicines Agency, or EMA. We plan to submit data to support an additional indication for the treatment of PFIC either at the time of these filings or to submit supplemental filings following approval, if any, of LUM001 for ALGS. Develop and seek regulatory approval for LUM001 in PBC and PSC in adults. Pending successful completion of our Phase 2 clinical trials and input from regulatory authorities, we plan to initiate a Phase 3 development program of LUM001 in PBC and PSC to support NDA and MAA filings. Advance the development and commercialization of LUM002 through a combination of internal development and strategic partnerships. We plan to initiate a Phase 2 clinical trial of LUM002 in NASH in the second half of 2014. We intend to seek strategic partnerships to accelerate the broader clinical development and commercialization of LUM002 in NASH and other metabolic diseases. Establish commercialization and marketing capabilities in North America for LUM001 and pursue strategic partnerships in other territories. We plan to build the capabilities to effectively commercialize and market LUM001 in North America if approved by the FDA. We believe that this commercial organization can be modest in size and targeted to the relatively small number of specialists in the United States who treat patients with cholestatic liver disease. We intend to pursue strategic partnerships for additional clinical development, if required, and the commercialization of LUM001 in markets outside of North America. Maximize the therapeutic potential of LUM001 in additional liver diseases. Beyond our initial focus in ALGS and PFIC in children and PBC and PSC in adults, we plan to develop LUM001 in other orphan cholestatic liver diseases such as biliary atresia, intrahepatic cholestasis of pregnancy, benign recurrent intrahepatic cholestasis and drug-induced cholestasis. Table of Contents Risks Associated With Our Business Our business is subject to numerous risks, as more fully described in the section entitled Risk Factors immediately following this prospectus summary. You should read these risks before you invest in our common stock. We may be unable, for many reasons, including those that are beyond our control, to implement our business strategy. In particular, risks associated with our business include: We have a limited operating history, and we have incurred net losses in every year since our inception, including an accumulated deficit of $24.6 million as of December 31, 2013, and we anticipate that we will continue to incur net losses in the foreseeable future. Our business is dependent on the success of our lead product candidate, LUM001, and our second product candidate, LUM002, each of which may require significant additional clinical testing before we can seek regulatory approval and potentially launch commercial sales. For example, LUM001 has been studied in 12 completed clinical trials in healthy volunteers and patients with hypercholesterolemia rather than patients with ALGS, PFIC, PBC or PSC, and LUM002 has been studied in two completed Phase 1 clinical trials in healthy volunteers and patients with type 2 diabetes, a form of metabolic disease, not patients suffering from NASH. The results of these completed clinical trials of LUM001 and LUM002 may not be indicative of results of our Phase 2 clinical trials of LUM001 in patients with ALGS, PFIC, PBC, and PSC or of LUM002 in patients with NASH. If the market opportunities for LUM001 and LUM002 are smaller than we believe they are, our future revenue may be adversely affected, and our business may suffer. The regulatory approval process is lengthy and time-consuming, and if we experience significant delays in the clinical development and regulatory approval of LUM001 or LUM002, or we are unable to obtain regulatory approval of LUM001 or LUM002, our business will be substantially harmed. If we fail to obtain additional financing, we may be forced to delay, reduce or eliminate our product development programs or commercialization efforts. If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected. Even though we have obtained orphan drug designation for LUM001 in ALGS, PFIC, PBC, and PSC, we may not be able to obtain or maintain the benefits associated with orphan drug status, including market exclusivity. We depend on intellectual property licensed from third parties and termination of any of these licenses could result in the loss of significant rights, which would harm our business. We rely on third parties to conduct our clinical trials and nonclinical studies and to manufacture clinical drug supplies. If these third parties do not successfully carry out their contractual duties or meet expected deadlines, we may not be able to obtain regulatory approval for or commercialize our product candidates. Even if we obtain regulatory approval for our product candidates, the products may not gain favorable reimbursement or market acceptance among physicians, patients, tertiary care centers, transplant centers and others in the medical community. If our efforts to protect the proprietary nature of the intellectual property related to our product candidates are not adequate, we may not be able to compete effectively in our market. We are highly dependent on our key personnel, and if we are not successful in attracting and retaining highly qualified personnel, we may not be able to successfully implement our business strategy. Table of Contents Corporate Information We were incorporated in Delaware in January 2011. Our principal executive offices are located at 12531 High Bluff Drive, Suite 110, San Diego, California 92130, and our telephone number is (858) 461-0694. Our corporate website address is www.lumenapharma.com. Information contained on or accessible through our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. We have obtained a registered trademark for Lumena Pharmaceuticals in the United States and the European Union. This prospectus contains references to our trademarks and to trademarks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this prospectus, including logos, artwork and other visual displays, may appear without the or TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Implications of Being an Emerging Growth Company As a company with less than $1.0 billion in revenue during our last fiscal year, we qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act, or JOBS Act, enacted in April 2012. An emerging growth company may take advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not limited to: being permitted to present only two years of audited financial statements and only two years of related Management s Discussion and Analysis of Financial Condition and Results of Operations in this prospectus; not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended; reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We may use these provisions until the last day of our fiscal year following the fifth anniversary of the closing of this offering. However, if certain events occur prior to the end of such five-year period, including if we become a large accelerated filer, our annual gross revenues exceed $1.0 billion or we issue more than $1.0 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company prior to the end of such five-year period. We have elected to take advantage of certain of the reduced disclosure obligations in the registration statement of which this prospectus is a part and may elect to take advantage of other reduced reporting requirements in future filings. As a result, the information that we provide to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests. The JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. We have irrevocably elected not to avail ourselves of this exemption and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Table of Contents The Offering Common stock offered by us shares Common stock to be outstanding after this offering shares Over-allotment option We have granted to the underwriters the option, exercisable for 30 days from the date of this prospectus, to purchase up to additional shares of common stock. Use of proceeds We estimate that we will receive net proceeds of approximately $ million (or approximately $ million if the underwriters exercise their over-allotment option in full) from the sale of the shares of common stock offered by us in this offering, based on an assumed initial public offering price of $ per share (the midpoint of the price range set forth on the cover page of this prospectus), and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the net proceeds from this offering to fund development of LUM001 and LUM002 and for working capital purposes, including general operating expenses and pre-commercialization activities. See Use of Proceeds.
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+The following summary highlights material information in this prospectus. It may not contain all the information that is important to you. For additional information, you should read this entire prospectus carefully, as well as the information incorporated by reference into this prospectus. General Carroll Bancorp, Inc. is a Maryland corporation that owns 100% of the outstanding common stock of Carroll Community Bank. On October 12, 2011, we completed our initial public offering of common stock in connection with the Bank s conversion from a state-chartered mutual savings bank to a state-chartered commercial bank, a stock form of organization. We sold 359,456 shares of common stock at $10.00 per share raising $3.6 million of gross proceeds. Since the completion of the initial public offering, Carroll Bancorp has not engaged in any significant business activity other than owning the common stock of and maintaining deposits in the Bank and lending funds to the employee stock ownership plan trust. At December 31, 2013, we had total assets of $107.7 million, loans outstanding, net, of $83.5 million, deposits of $91.8 million, stockholders equity of $8.4 million, and a book value per share of $23.41. Net income for the year ended December 31, 2013 was $222,000. Carroll Community Bank is a state-chartered commercial bank headquartered in Sykesville, Maryland. The Bank was organized in 1870 as Sykesville Perpetual Building Association. The Association was chartered in 1887 and re-chartered and reorganized in 1907 when it became Sykesville Building Association of Carroll County. In October 1985 the Association was chartered as a federal mutual savings association. On September 12, 1988 the business name changed from Sykesville Building Association of Carroll County to Sykesville Federal Savings Association. In July 2010, Sykesville Federal Savings Association converted from a federal savings association to a Maryland-chartered mutual savings bank and changed its name to Carroll Community Bank. On October 12, 2011, the Bank converted from a state-chartered mutual savings bank to a state-chartered commercial bank, a stock form of organization, pursuant to its plan of conversion of which the formation of Carroll Bancorp and the completion of its initial public offering of common stock was a part. Our business has consisted primarily of attracting and accepting deposits from the general public in the areas surrounding our offices and investing those deposits, together with funds generated from operations, primarily in residential mortgage loans and commercial real estate loans. We recently have increased, and intend to continue to increase, our focus on commercial real estate loans and related products, including demand deposit accounts, remote deposit capture and business internet banking to support the business community. We are committed to meeting the credit needs of our community, consistent with safe and sound operations. We offer a variety of deposit products, including savings accounts, certificates of deposit, money market accounts, business and retail noninterest and interest bearing checking accounts and individual retirement accounts. We have two full service branches with each providing a drive-through facility and automated teller machine, or ATM, for our customers convenience. We have based our strategic plan on the foundation of enhancing stockholder value, growth in market share and operating profitability. Our goals include maintaining credit quality, using technology to expand market share and implementing extensions of core banking services. The primary market areas we serve are in Carroll and Howard Counties in Maryland. We are headquartered in Sykesville, Maryland, a suburban area located 20 miles west of the city of Baltimore, Maryland. Sykesville is located in the southeastern portion of Carroll County, close to the border of Howard and Baltimore Counties. Carroll Community Bank maintains one other branch office in the town of Westminster, located in central Carroll County. As a bank holding company, Carroll Bancorp is required to file certain reports with, is subject to examination by, and otherwise must comply with the rules and regulations of the Federal Reserve Board, and is subject to certain regulations of the Maryland Office of the Commissioner of Financial Regulation. Carroll Bancorp is also subject to the rules and regulations of the Securities and Exchange Commission ( SEC ) under the federal securities laws. As a state chartered commercial bank, Carroll Community Bank is supervised and examined by the Maryland Office of the Commissioner of Financial Regulation, and by the Federal Deposit Insurance Corporation (the FDIC ) as the insurer of its deposits and its primary federal regulator. Carroll Community Bank is also regulated to a lesser extent by the Federal Reserve Board, governing reserves to be maintained against deposits and other matters. Carroll Community Bank s relationship with its depositors and borrowers also is regulated by state and federal law, including in matters concerning the ownership of deposit accounts and the form and content of Carroll Community Bank s loan documents. This system of state and federal regulation and supervision establishes a comprehensive framework of activities in which an institution may engage and is intended primarily for the protection of Table of Contents the FDIC s deposit insurance fund and depositors, and not for the protection of stockholders. Carroll Community Bank is periodically examined by the Maryland Office of the Commissioner of Financial Regulation and the FDIC to ensure that it satisfies applicable standards with respect to its capital adequacy, assets, management, earnings, liquidity and sensitivity to market interest rates. Following examinations, the Maryland Office of the Commissioner of Financial Regulation and the FDIC prepare reports for the consideration of Carroll Community Bank s board of directors on any operating deficiencies. Our executive offices are located at 1321 Liberty Road, Sykesville, Maryland 21784. Our telephone number at this address is (410) 795-1900. Our website address is www.carrollcobank.com. Information on our website is not incorporated by reference into this prospectus and is not a part of this prospectus. Additional information about us is included in documents incorporated by reference in this prospectus. See Information Incorporated by Reference. The Rights Offering Issuer Carroll Bancorp, Inc. Securities offered We are distributing to you, at no charge, one non-transferable subscription right for every one share of our common stock that you owned on the record date, either as a holder of record or, in the case of shares held of record by brokers, dealers, banks or other nominees, on your behalf, as a beneficial owner of such shares. These rights may be exercised only by you, and cannot be sold, transferred or assigned to anyone else. Basic subscription right For each subscription right that you own, you will have a basic subscription right to buy from us .3477 Unit at the subscription price. Each Unit consists of one share of our common stock and a warrant to purchase one-half of a share of our common stock, provided, however, that any fractional Units that would result from the exercise of your subscription rights will be disregarded (i.e. rounded down to the nearest whole number). You may exercise your basic subscription right for some or all of your basic subscription rights, or you may choose not to exercise any of your basic subscription rights. The number of rights you may exercise appears on your rights certificate if you are a holder of record. Over-subscription privilege If you elect to exercise your basic subscription right in full, you may also subscribe for additional Units at the same subscription price per Unit. If an insufficient number of Units are available to fully satisfy the over-subscription privilege requests, the available Units will be distributed pro rata among rights holders who exercised their over-subscription privilege based on the number of over-subscription Units to which they subscribed. You may subscribe for Units pursuant to your over-subscription privilege, subject to the purchase and ownership limitations described below under the heading Limitation on your purchase of Units. Limitation on your purchase of Units We will not issue shares of common stock and warrants constituting the Units pursuant to the exercise of basic subscription rights or over-subscription privileges to any stockholder who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to Table of Contents acquire, own or control such shares if, as of March 20, 2014, such clearance or approval has not been obtained and/or any applicable waiting period has not expired. Subscription price $16.00 per Unit. Warrants Each Unit consists of one share of common stock and a warrant to purchase one-half of a share of common stock for a purchase price of $16.00 per whole share, which must be paid in cash at the time of exercise. Each warrant will be exercisable immediately upon completion of the offering and will expire on the third anniversary of the completion of the offering. The warrants will be adjusted to reflect any stock split, stock dividend or similar recapitalization with respect to the common stock. The warrants will not be transferable and will not be listed on any stock exchange. No fractional shares will be issued in connection with the exercise of any warrants. If you purchase an odd number of Units, then the aggregate number of shares of common stock that the warrants you are issued permit you to purchase will be rounded down to the nearest whole share. Record date 5:00 p.m. Eastern Time on January 16, 2014. Common stock to be outstanding after the offering If all of the Units offered hereby are sold, approximately 484,438 shares of common stock will be outstanding after the offering. (1) Expiration date 5:00 p.m. Eastern Time, on March 20, 2014. We may extend the rights offering without notice to you until April 19, 2014. Material U.S. federal income tax consequences For U.S. federal income tax purposes, you should not recognize income or loss upon receipt or exercise of a subscription right. You should consult your own tax advisor as to the tax consequences to you of the receipt, exercise or lapse of the subscription rights in light of your particular circumstances. Extension, amendment and cancellation Although we do not presently intend to do so, we have the right to amend the terms of the rights offering or to extend the rights offering expiration date, but in no event will we extend the rights offering beyond April 19, 2014. Our board of directors may cancel the rights offering at any time. If we cancel the rights offering, all subscription payments received by the subscription agent will be returned, without interest or deduction, as soon as practicable. Best efforts offering We are offering the Units on a best efforts basis through our directors and executive officers, who will not receive any discounts or commissions for selling such Units. There is no minimum number of Units that must be sold in order to close this offering and accept your subscription. Table of Contents Subscription agent Registrar and Transfer Company Information agent Keefe, Bruyette & Woods, Inc. Warrant agent Registrar and Transfer Company Use of proceeds We estimate that we will receive net proceeds from this offering of approximately $1.9 million, after deducting estimated offering expenses of the offering, assuming we sell all of the Units offered hereby. We anticipate using the net proceeds of the offering to contribute to the capital of the Bank for the primary purpose of funding organic loan growth, including increasing the allowable maximum loan amount that it may extend to any one customer, and for the Bank s working capital and other general corporate purposes. In the short term, however, we anticipate using the net proceeds of the offering to temporarily reduce short-term borrowings. OTC Market Group QB Marketplace Symbol CROL
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this Prospectus. Because this is only a summary, it does not contain all of the information that you should consider in making your investment decision. For a more complete understanding of us and this offering, you should read and consider the entire Prospectus, including the information set forth under "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements and related notes thereto before deciding whether to invest in our common stock. Except as otherwise required by the context, references to "Company," "Peak," "we," "us" and "our" are to Peak Resorts, Inc. and its subsidiaries. The historical financial statements and financial data included in this Prospectus are those of Peak Resorts, Inc. and its consolidated subsidiaries. Unless otherwise indicated, we have derived industry data from publicly available sources that we believe are reliable. Our Company We are a leading owner and operator of high-quality, individually branded ski resorts in the U.S. We currently operate 13 ski resorts primarily located in the Northeast and Midwest, 12 of which we own. The majority of our resorts are located within 100 miles of major metropolitan markets, including New York City, Boston, Philadelphia, Cleveland and St. Louis, enabling day and overnight drive accessibility. Our resorts are comprised of nearly 1,650 acres of skiable terrain that appeal to a wide range of ages and abilities. We offer a breadth of activities, services and amenities, including skiing, snowboarding, terrain parks, tubing, dining, lodging, equipment rentals and sales, ski and snowboard instruction and mountain biking and other summer activities. We believe that both the day and overnight drive segments of the ski industry are appealing given their stable revenue base, high margins and attractive risk-adjusted returns. We have successfully acquired and integrated ten ski resorts since our incorporation in 1997, and we expect to continue executing this strategy. We have built an award-winning portfolio of individually branded entertainment properties, most of which are recognized as leading ski resorts in their respective markets. Our devotion to maintaining high quality standards across our portfolio through strategic investments and upgrades has created a loyal customer base that contributes to a significant number of repeat visits at each of our resorts. In particular, our investment over the last decade in the latest high-efficiency snowmaking equipment has earned us the reputation as an industry leader in snowmaking efficiency, capacity and quality, allowing us to consistently increase skier visits and revenue per skier. Since 2008, we have invested $49.7 million in capital expenditures and growth initiatives. Our strong branding reinforces customer loyalty and serves to attract new visitors through focused marketing campaigns and word of mouth. Combined, our ski resorts generated approximately 1.8 million visits in the 2013/2014 ski season, an increase of 4% from the prior ski season, which we believe puts us among the top U.S. ski resort operators in terms of number of visits during these seasons. We increased our revenue by 5.5%, from $99.7 million in fiscal 2013 to $105.2 million in fiscal 2014. As the U.S. economy continues to improve, our resorts are well-positioned to benefit from increased consumer spending on leisure activities, and we expect to continue to increase our lift ticket prices and drive more skier visits to our resorts. We believe we are better positioned to handle downturns in the economy than larger, overnight fly ski resorts because of our greater accessibility and lower overall costs to consumers. The U.S. ski industry is highly fragmented, with less than 13% of the 470 ski resorts being owned by companies with four or more ski resorts. We believe that our proven ability to efficiently operate multiple resorts and our track record of successful acquisitions have created our reputation in the marketplace as a preferred buyer. We believe that our extensive experience in acquiring ski resorts and investing in snowmaking, lifts and other skier services, as well as the synergies we create by operating multiple resorts, drives increased revenues and profitability. Our capabilities serve as a competitive advantage in sourcing and executing investment opportunities as sellers will often provide us a "first Amendment No. 2 to Form S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Industry and Market Data Market data and certain industry forecasts used herein were obtained from internal surveys, market research, publicly available information and industry publications. For purposes of comparing market data with Company performance, the term EBITDA is calculated as net income before interest, depreciation and amortization. While we believe that the market research, publicly available information and industry publications we use are reliable, we have not independently verified market and industry data from third-party sources. Moreover, while we believe our internal surveys are reliable, they have not been verified by any independent source. (1)Represents the approximate percentage of skiable terrain covered by our snowmaking capabilities; total represents average of snowmaking coverage weighted by the respective properties' skiable acres. (2)Total figure represents the average weighted by skiable acres. (3)We purchased the Jack Frost and Big Boulder ski resorts in December 2011. Prior to that time, we operated these resorts pursuant to leases since 2005. (4)Quad count includes one six-pack lift. (5)Includes lodging revenue. Peak Resorts, Inc. (Exact name of registrant as specified in its charter) Missouri (State or other jurisdiction of incorporation or organization) 7990 (Primary Standard Industrial Classification Code Number) 43-1793922 (IRS Employer Identification No.) 17409 Hidden Valley Drive Wildwood, Missouri 63025 (636) 938-7474 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents Hidden Valley opened for business in 1982 as the first ski resort operated by our founder. In 2012, we opened West Mountain, which expanded our skiable acreage by approximately 40%. Hidden Valley is located within the St. Louis MSA and is the only ski resort within a 250 mile radius. Hidden Valley attracts skiers from as far away as Memphis, Tennessee and Jackson, Mississippi. The ski resort has 77 snowmaking machines to ensure snow quality throughout the season with a capacity of up to 5,000 gallons of water per minute, or 12 inches of machine-made snow in a 24-hour period. Location: Wildwood, MO Population Base: 3.9 million Total Lifts: 10 Skiable Acreage: 60 Snow Creek began operation in 1985 and is located 34 miles north of Kansas City. Snow Creek is the only ski resort in the Kansas City region, and the next closest ski resort is Hidden Valley in St. Louis. The ski resort also has 60 snowmaking machines to ensure snow quality throughout the season with a capacity of up to 3,000 gallons of water per minute, or 12 inches of machine-made snow in a 24-hour period. Location: Weston, MO Population Base: 2.9 million Total Lifts: 6 Skiable Acreage: 40 Paoli Peaks has been in operation since 1978 and has contributed several revolutionary concepts to the industry. Paoli Peaks has been recognized as the first resort to utilize snowmaking machines located on towers as well as introducing midnight skiing, an event that has become popular throughout the ski industry. Paoli Peaks' snowmaking machines can produce 12 inches of machine-made snow in a 24-hour period. Location: Paoli, IN Population Base: 3.0 million Total Lifts: 8 Skiable Acreage: 65 Timothy D. Boyd 17409 Hidden Valley Drive Wildwood, Missouri 63025 (636) 549-0060 (Name, address, including zip code, and telephone number, including area code, of agent for service) With copies to: David W. Braswell Armstrong Teasdale LLP 7700 Forsyth Boulevard, Suite 1800 St. Louis, Missouri 63105 (314) 552-6631 Carmelo M. Gordian Ted A. Gilman Michelle D. Kwan Andrews Kurth LLP 111 Congress Avenue, Suite 1700 Austin, Texas 78701 (512) 320-9290 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement is declared effective. If any securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(c) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents Mad River Mountain will mark its 53rd season of operation in 2014/2015 ski season. In addition to the most expansive skiable terrain in Ohio, Mad River Mountain is home to the state's largest snowmaking system. Mad River's snowmaking system is comprised of 133 fan guns that have the ability to pump over 7,000 gallons of water per minute and cover 100% of our terrain in as little as 72 hours. The resort has four terrain parks, including Capital Park, which was voted the Midwest's best terrain park by OnTheSnow website in 2013. Over the years, the facility has grown from a small commuter resort into the 324-acre winter playground that it is today. Location: Zanesfield, OH Population Base: 2.8 million Total Lifts: 12 Skiable Acreage: 60 Boston Mills and Brandywine Ski Resorts are a pair of sister ski resorts located within the Cleveland MSA and Cuyahoga Valley Park. The two locations were developed independently in the 1960's, beginning with Boston Mills in 1963. Brandywine Resort was purchased by the previous owners of Boston Mills in 1990, forming the dual-resort complex that it is today. Boston Mills and Brandywine are conveniently located approximately three miles apart and combined have over 18,000 season pass holders. All three of our Northeast Ohio ski resorts Alpine Valley, Boston Mills and Brandywine are operated collectively, which provides us with revenue and cost synergies. Location: Sagamore Hills, OH Population Base: 7.1 million Total Lifts: 18 Skiable Acreage: 88 Crotched Mountain Ski & Ride is located approximately 70 miles from the Boston MSA. We acquired Crotched Mountain in 2003 and reopened the ski resort during the 2003/2004 ski season, its first year of operation after a 13-year closure. Upon acquisition, we invested significant capital to increase snowmaking capabilities, add new lifts and build new skier services facilities. In the 2013/2014 ski season, we achieved 94,600 skier visits and $4.4 million in revenues. Crotched Mountain's snowmaking system claims the highest snow production capacity of any ski resort in New England. In the summer of 2012, we installed "The Rocket" at Crotched Mountain, which is Southern New Hampshire's only high-speed detachable quad chairlift. Crotched Mountain is also the only resort within New England that offers midnight skiing. Location: Bennington, NH Population Base: 10.5 million Total Lifts: 5 Skiable Acreage: 105 Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, Dated November 20, 2014 PRELIMINARY PROSPECTUS 10,000,000 Shares Peak Resorts, Inc. Common Stock Table of Contents Jack Frost Mountain and Big Boulder Ski Resorts are located in the Pocono Mountains of Pennsylvania near the Philadelphia and New York City MSAs. Jack Frost and Big Boulder are conveniently located five miles apart and are operated collectively, which provides us with revenue and cost synergies. Big Boulder first opened in 1949 and was the first commercial ski resort in Pennsylvania. Both resorts are known for their powerful snowmaking systems, and Big Boulder has been the first ski resort in Pennsylvania to open during each of the last eight years. Big Boulder Ski Resort devotes 50% of its acreage to freestyle terrain parks and it was ranked in the "Top 5 Parks in the East" by Transworld Snowboarding Magazine in 2009, 2010 and 2011. Location: Blakeslee, PA Population Base: 27.3 million Total Lifts: 23 Skiable Acreage: 145 Attitash Mountain Resort is located within close proximity of Mt. Washington and approximately 150 miles from the Boston MSA. Attitash was ranked among the East's top ten ski resorts for snow, grooming, weather, dining, apr s ski, off-hill activities and family programs by readers of SKI Magazine in 2010. Attitash Mountain Resort is a vacation destination for all seasons, offering a variety of summer attractions such as North America's longest Alpine Slide, the Nor'Easter Mountain Coaster and New England's longest zip line of 5,000 feet. Attitash features a 143-room Grand Summit Hotel, providing some of the only ski-in/ski-out accommodations in the area. Location: Bartlett, NH Population Base: 13.9 million Total Lifts: 11 Skiable Acreage: 307 Mount Snow, a two-time host of the Winter X Games, is located in the Green Mountains of southern Vermont and is the state's closest major resort to the Northeast's largest metropolitan areas, making for a short drive to big mountain skiing. Mount Snow is approximately 200 miles from New York City, 130 miles from Boston, 65 miles from Albany and 100 miles from Hartford. Founded in 1954 by National Ski & Snowboard Hall of Fame member Walter Schoenknecht, Mount Snow quickly became one of the most recognizable ski resorts in the world. We have invested more than $20.0 million in capital enhancements since acquiring Mount Snow in the spring of 2007. The primary elements of those enhancements are the installation of more than 250 high output fan guns, the most of any resort in North America, giving Mount Snow one of the most powerful and efficient snowmaking systems in the industry, and the $8.7 million Bluebird Express, which is North America's only six passenger bubble lift. Transworld Snowboarding Magazine ranked Carinthia the "#1 Terrain Park in the East" for the 2013/2014 ski season and a "Top 5 Park in the East" for each of the last five years. This all-freestyle terrain mountain face is home to ten different terrain parks, ranging from This is the initial public offering of our common stock. We are offering 10,000,000 shares of our common stock. No public market currently exists for our common stock. We currently expect the initial public offering price to be between $9.00 and $11.00 per share. We have applied to list our common stock on the NASDAQ Global Market ("NASDAQ") under the symbol "SKIS". There is no assurance that this application will be approved. Table of Contents beginner features in Grommet to expert features in Inferno, as well as a 450-foot long super pipe with 18 foot walls. Mount Snow features a 196-room Grand Summit Hotel, providing some of the only ski-in/ski-out accommodations in the area. Location: West Dover, VT Population Base: 27.4 million Total Lifts: 20 Skiable Acreage: 490 Wildcat Mountain Ski Resort is located in the White Mountains in the Mt. Washington region just 16 miles from its sister resort, Attitash Mountain. The summit elevation is 4,002 feet, and the base area elevation is 1,950 feet, which gives Wildcat a vertical drop of 2,112 feet. Wildcat is one of the best-known alpine skiing resorts in New England due to its scenic views of Mt. Washington. It also contains the longest ski trail in New Hampshire and is home to one of the oldest ski-racing trails in the U.S. The original "Wildcat" trail was cut in 1933 by the Civilian Conservation Corps and celebrated its 80th anniversary as a ski trail in 2013. Wildcat was the first ski resort to have a gondola lift in the U.S., which opened on January 25, 1958. The resort hosted the U.S. downhill skiing championship in 1984, 1992, 1995 and 2007. Wildcat has garnered a reputation for strong spring skiing as it has had the latest closing date of any lift-serviced ski resort in New Hampshire for the past eight seasons. Location: Jackson, NH Population Base: 13.9 million Total Lifts: 5 Skiable Acreage: 225 One of Northeast Ohio's oldest public ski resort, Alpine Valley has been in operation since 1965 and is the most recent resort to join our portfolio after our acquisition in 2012. It is located in Ohio's snow belt, allowing it to receive the most natural snowfall out of all of Ohio's ski resorts. All three of our Northeast Ohio ski resorts Alpine Valley, Boston Mills and Brandywine are operated collectively, which provides us with revenue and cost synergies. Alpine Valley is 31 miles northeast of Boston Mills/Brandywine Resorts and is located near the Cleveland MSA. In the summer of 2013, we installed two additional chairlifts, two additional tubing handle tows and a new beginner surface lift. Alpine Valley also boasts a newly-installed, state-of-the-art snowmaking system equipped with 30 new tower and portable fan guns along with a new pump house and maintenance facility. The improvements and upgrades to Alpine Valley constituted a total capital investment of over $2.5 million. Location: Chesterland, OH Population Base: 7.1 million Total Lifts: 7 Skiable Acreage: 54 Investing in our common stock involves risk. See "Risk Factors" beginning on page 19 to read about risks you should consider before buying our common stock. Neither the Securities and Exchange Commission (the "SEC"), any state securities commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this registration statement. Any representation to the contrary is a criminal offense. Table of Contents Competitive Strengths We believe our strengths are as follows: We own a high-quality branded portfolio. We own 12 and operate 13 high-quality ski resorts, each of which is individually branded and recognized to be a leading ski resort in its respective regional market. Our devotion to maintaining high quality standards through strategic investments and upgrades has created a loyal customer base at each of our resorts. Our strong branding reinforces customer loyalty and serves to attract new guests through focused marketing campaigns and word of mouth. We have a history of investing in targeted capital projects to increase profitability. We are continuously evaluating our property-level performance and are committed to increasing our profitability. Many ski resort operators are unwilling to invest in improvements due to capital constraints and the perceived risk of such investments. Since 2008, we have invested $49.7 million throughout our portfolio in an effort to improve the profitability of our ski resorts through energy-efficient snowmaking machinery, high-speed/high-capacity lifts and additional features such as terrain parks and various other infrastructure investments. The costs of these improvements are significantly outweighed by the benefits realized, which include higher quality and less costly snow, shorter lift lines, terrain expansion and customer appreciation. We have found that the ability to transport customers up the mountain on high-speed chairlifts and to reduce lift lines not only attracts skiers and promotes a better skiing experience but also leads to higher restaurant and retail sales and increased customer satisfaction. We are an experienced and successful acquirer and integrator. We have grown our Company significantly since inception by acquiring strategically located ski resorts with the potential for increased revenue growth and margin expansion. We have successfully acquired and integrated ten ski resorts since 1997. We adhere to a disciplined acquisition strategy by pursuing opportunities at attractive acquisition prices that can create additional value through operational improvements and efficiencies. After acquiring a ski resort, we implement a strategic repositioning program designed during the underwriting process and integrate the resort into our portfolio. We believe that our track record for acquiring and integrating ski resorts makes us an industry leader and gives us a competitive advantage over other buyers. Our ski resorts have, on average, achieved compound annual EBITDA growth of 34.4% within two years of our ownership or operation. Our experienced senior management team is dedicated to providing a reliable and enjoyable ski experience. Our three senior executives have almost 60 years of combined experience owning, operating and acquiring ski resorts in the U.S. Since 1982, it has been our vision to offer a reliable and enjoyable skiing experience to our customers. As a result of this vision, our management team constantly strives to enhance and improve our snowmaking capabilities to ensure our ski resorts maintain high-quality snow throughout the season. In addition, our management team strives to provide our ski resorts with a full range of amenities to augment our customers' overall skiing experience. Overnight drive and day ski resorts experience lower sensitivity to the economy. We believe our portfolio provides more attractive risk-adjusted returns than overnight fly resorts due to the stability in our visits. Furthermore, we believe that customers are more likely to visit overnight drive and day ski resorts during an economic downturn as compared to other higher cost overnight fly ski resorts, resulting in less sensitivity to downturns in the economy. The revenue per skier visit of our resorts from the 2007/2008 ski season (the first season subsequent to the Mount Snow and Attitash acquisitions) to the 2012/2013 ski season increased at a compounded annual growth rate of 4.3% compared to an increase of 2.8% for the U.S. ski industry for the same period. Per Share Total Initial public offering price $ $ Underwriting discount and commissions(1) $ $ Proceeds, before expenses, to us $ $ (1)We refer you to "Underwriting" beginning on page 106 for additional information regarding total underwriter compensation. The underwriters have an option exercisable within 45 days from the date of this Prospectus to purchase up to 1,500,000 additional shares of common stock from us at the initial public offering price, less the underwriting discount and commissions to cover over-allotments of shares. The shares of common stock issuable upon exercise of the underwriters' over-allotment option have been registered under the registration statement of which this Prospectus forms a part. The underwriters expect to deliver the common stock against payment in U.S. dollars in New York, New York on or about , 2014. Table of Contents The ski industry possesses high barriers to entry. A limited number of ski resorts have been developed in the past 30 years. Skiable land is scarce and demanding to develop due to the difficulty in aggregating suitable terrain, obtaining government permitting, resolving accessibility issues and addressing heightened environmental concerns. Operating a ski resort requires a high level of expertise and strict regulatory and environmental compliance. Additionally, many resorts have built significant customer loyalty and brand awareness over multiple generations, which can be difficult for a new entrant to overcome. These factors have contributed to the number of ski resorts decreasing 36%, from 735 in 1984 to 470 in 2014 as smaller, poorly capitalized resorts have been unable to compete effectively. With our large existing portfolio, proven capital investment strategy and strong customer loyalty, we believe our Company is competitively well-positioned. Our ski resort portfolio is diverse. Our portfolio of 13 ski resorts consists of five overnight drive ski resorts and eight day ski resorts located across six states ranging from Missouri to New Hampshire. We believe that our portfolio mix enables us to reach a large customer base seeking high-quality ski resorts within driving distance of major metropolitan areas. Each of our ski resorts is located within reasonable drive times from major metropolitan areas such as New York City, Boston, Philadelphia, Cleveland and St. Louis, which we believe provides us with a consistent repeat customer base and increases our new customer outreach potential. We believe that the size and geographic diversity of our portfolio helps insulate the Company's financial performance against adverse economic and weather conditions. We are a proven operator of ski resorts. We have operated numerous ski resorts since our incorporation in 1997. Due to our extensive operating expertise, we believe we have a profitable and efficient platform that positions us to take advantage of growth initiatives and cost controls. Our revenue growth and EBITDA margins were 22% and 26%, respectively, for fiscal 2013, whereas the industry experienced revenue growth of 13% and EBITDA margins of 16% over the same time period. Alignment of interests between management and new stockholders. Subsequent to this transaction, our management team will own approximately 16.1% of our outstanding shares. We believe that this substantial ownership position aligns the interest of our operating team with that of our new stockholders. Growth Strategies Increase visits. We have invested significant capital in our snowmaking capabilities, terrain parks, year-round activities and skier facilities as an important component in increasing visits and revenue per skier visit, as well as developing and maintaining our brand and market reputation. Our continuous investment in the latest high-efficiency snowmaking equipment across our resorts provides our guests with consistent and high-quality skiing surfaces as well as a longer skiable season. By maintaining high-quality snow conditions across a longer ski season, we are able to drive repeat visits among our current clients and attract new clients from other resorts. Over the last decade, we have met the demand for quality terrain parks in the Northeast and Midwest with terrain park developments that include award-winning parks such as Carinthia Park at Mount Snow, Big Boulder Park at Big Boulder and Capital Park at Mad River. Our terrain parks are located where few substitutes exist, creating strong loyalty amongst our guests and driving increased skier visits. We intend to continue diversifying our winter activities to include additional terrain parks and tubing hills and adding summer activities such as mountain biking, zip lines and horseback riding. Drive revenue per skier visit. We believe that several of our resorts are considered to be premier ski resorts in their respective metropolitan areas, providing us with enhanced pricing power. We FBR Stifel Baird Table of Contents increased our season pass price and rack rates for the 2013/14 season over those in effect for the 2012/13 season. We were able to increase our revenue 5.5% from $99.7 million in fiscal 2013 to $105.2 million in fiscal 2014. We anticipate our previous and planned investments in snowmaking and facilities will allow us to continue to raise our quality level and prices for lift tickets, lodging, food and beverage, equipment rentals and other activities at our resorts. Improve operating efficiency through technology and scale. We continue to focus on driving operational synergies and margin expansion via investment in technology and increasing economies of scale. Through continued investment in energy-efficient snowmaking machines, we have decreased our energy costs while creating a superior skiing experience for our guests. For example, we are currently under contract to purchase 645 new high-efficiency snowmaking machines to be deployed at Mount Snow through a partnership with Efficiency Vermont, which will fund 75% of the acquisition cost. We expect to achieve payback of our entire investment within one year. As an operator of 13 ski resorts, we benefit from our scale of procurement, insurance and technology. As we continue to invest in technology and grow through acquisitions, we expect to realize further efficiencies and economies of scale, driving higher margins than many of our competitors. Monetize developable real estate. We own developable land at Mount Snow that is entitled for up to 900 residential units, including ski-in and ski-out condos, and 200,000 square feet of resort amenities, including restaurants, ski rental and retail shops, guest services and other functions. Given recent improvements in the second home and vacation home markets, we believe that we can generate significant profits from the further development of the Mount Snow land. In addition to sales of residential units, we believe that the mixed-use property development, including updated skier services, additional amenities and added occupancy capability, will create a significant opportunity for us to maximize Mount Snow's operational profitability. We are currently in the process of raising up to $52.0 million of debt capital under an EB-5 program to capitalize the first stage of development, including a new lodge, snowmaking infrastructure, including a new water reservoir, and related skier services. We intend to commence development of these projects in the second half of calendar year 2015. Additionally, we own developable land at Attitash. While we do not have imminent plans to develop the Attitash real estate, we could benefit from the sale or development of that land at some point in the future. Pursue strategic acquisitions. As an operator of 13 ski resorts benefiting from economies of scale and investment in technology, we believe we can generate substantial revenue and cost synergies through strategic acquisitions. The U.S. ski industry, consisting of 470 resorts, is highly fragmented with less than 13% of ski resorts being owned by companies with four or more ski resorts. We estimate that there are approximately 250 day ski and 180 overnight drive ski resorts in the U.S. providing us with numerous acquisition opportunities. We believe that our proven ability to efficiently operate multiple resorts as well as our track record of successful acquisitions have established our reputation in the marketplace as a preferred buyer and will provide us the opportunity to acquire additional complementary ski resorts at attractive valuations. Our targeted acquisition strategy is to identify and purchase ski resorts where we can introduce many of the initiatives currently in place at our existing resorts, such as superior quality and efficiency snowmaking, high-speed detachable chair lifts and upgraded skier service and hospitality facilities, in order to drive increased skier visits, price increases and enhanced profitability. Ski Industry The U.S. ski industry was estimated to total approximately 56.5 million skier visits in the 2013/2014 ski season. The National Ski Areas Association Kottke National End of Season Survey reported that there were 470 ski resorts operating during the 2013/2014 ski season in the U.S. Given the consistency Janney Montgomery Scott Oppenheimer & Co. Table of Contents and strength of annual skier visits over the last 30 years as well as the state of the recovering economy, we believe that skier participation will remain strong in the coming years. The ski industry divides ski resorts into three distinct categories: overnight fly, overnight drive and day ski resorts. Overnight fly ski resorts are defined as ski resorts which primarily serve skiers who fly or drive considerable distances and stay for multiple nights. These resorts depend, in large part, on long-distance travel by their visitors and on the development of adjacent real estate for housing, hospitality and retail uses. Overnight drive ski resorts are ski resorts which primarily serve skiers from the regional drive market who stay overnight. Day ski resorts are typically located within 50 miles of a major MSA and do not generally offer dedicated lodging. Day and overnight drive ski resorts tend to be smaller in size and are usually located near metropolitan areas. As an owner and operator of primarily day and overnight drive ski resorts, we focus on selling lift tickets, renting ski equipment, selling ski lessons, offering food and beverage services and catering to the targeted local market. We target skiers of all levels from beginners who are skiing for the first time to intermediate and advanced skiers who are honing their skills. An important statistic used to gauge the performance of companies operating within the ski industry is revenue per skier visit. The revenue per skier visit of our resorts for the 2007/2008 ski season (the first season subsequent to the Mount Snow and Attitash acquisitions) to the 2012/2013 ski season increased at a compounded annual growth rate of 4.3% compared to an increase of 2.8% for the U.S. ski industry for the same period. Revenue per skier visit is calculated as total resort revenue divided by skier visits. The ski industry statistics stated in the foregoing sections have been derived from data published by the Kottke National End of Season Survey 2013/2014 and other industry publications, including those of the National Ski Areas Association. Recent Developments On November 10, 2014, the Company and certain of its subsidiaries entered into a Restructure Agreement with certain affiliates of the Company's primary lender, EPR Properties ("EPR"), providing for the prepayment of certain formerly non-prepayable notes in the event that the Company's net proceeds from this offering exceed approximately $44.9 million plus closing and transaction costs (such transaction hereinafter referred to as the "Debt Restructure"). The Debt Restructure allows the Company to pre-pay up to approximately $76.2 million in debt secured by the Crotched Mountain, Attitash, Paoli Peaks, Hidden Valley and Snow Creek properties and to retire one of the notes associated with the future development of Mount Snow, with the closing of such transaction to occur three business days following closing of the offering and to be contingent upon the Company's receipt of net proceeds from this offering sufficient to pre-pay the Mount Snow Development Debt of approximately $42.9 million, a Defeasance Fee not to exceed $5 million (which amount adjusts based on the actual amount of the prepayment but which will in no event be less than $2 million), and certain closing and transaction costs. In the event that the net proceeds exceed the sum of such amounts, various notes and mortgages will be paid down in the following order: Crotched Mountain, Attitash, Snow Creek, Paoli Peaks and Hidden Valley. In exchange for such prepayment right, the Debt Restructure provides that EPR shall be granted a purchase option on the Boston Mills, Brandywine, Jack Frost, Big Boulder and Alpine Valley properties, which will be exercisable as to any one or more of such properties on the maturity date of the notes and mortgages for such properties by the delivery of written notice by EPR to the Company at least one (1) year prior to such maturity date and upon payment of a purchase price for each such property calculated by multiplying the previous fiscal year's EBITDAR (defined as earnings before interest, taxes, debt service and rent) applicable to such property by fifty percent (50%) and dividing Prospectus dated , 2014 Table of Contents the product by the applicable initial interest rate payable under the note associated with such property, with a minimum purchase price of not less than the outstanding balance of the applicable loan on the closing date. Upon the closing of the sale under the option, EPR will enter into an agreement with the Company or one of its subsidiaries for the lease of each such acquired property for an initial term of 20 years, plus options to extend the lease for two additional periods of 10 years each. All current option agreements between the Company and/or its subsidiaries and EPR shall be terminated at the time of the closing of the Debt Restructure. In addition, the Company has agreed to extend the maturity dates on all non-prepayable notes and mortgages secured by the Mount Snow, Boston Mills, Brandywine, Jack Frost, Big Boulder and Alpine Valley properties remaining after the closing of this offering by seven years to a period of 20 years from the date of the closing of the transactions contemplated by the Debt Restructure and to extend the lease for the Mad River property, previously terminating in 2026, until December 31, 2034. In addition, the Debt Restructure provides for a right of first refusal on the part of EPR to provide all or a portion of the financing associated with any purchase, ground lease, sale/leaseback, management or financing transaction contemplated by the Company or any of its subsidiaries with respect to any new or existing ski resort property for a period of seven years after the closing of the transactions contemplated by the Debt Restructure. Proposed financings from certain types of institutional lenders providing a loan to value ratio of less than 60% (as relates to the applicable property being financed) are excluded from the right of first refusal. An additional right of first refusal will be granted to EPR with respect to any sale or transfer of Attitash. The Restructure Agreement also contemplates that the Company and certain of its subsidiaries will enter into a Master Credit and Security Agreement ("Master Credit Agreement") with EPR containing additional terms and conditions governing the restructured loans, including restrictions on certain transactions including mergers, acquisitions, leases, asset sales, loans to third parties, and the incurrence of additional debt and liens. Financial covenants set forth in the Master Credit Agreement consist of a maximum Leverage Ratio (as defined in the Master Credit Agreement) of 65%, above which the Company and certain of its subsidiaries are prohibited from incurring additional indebtedness, and a Consolidated Fixed Charge Coverage Ratio (as defined in the Master Credit Agreement) covenant, which (a) requires the Company to increase the balance of its debt service reserve account if the Company's Consolidated Fixed Charge Coverage Ratio falls below 1.50:1.00, and (b) prohibits the Company from paying dividends if the ratio is below 1.25:1.00. The payment of dividends is also prohibited during default situations. The Master Credit Agreement also provides for additional interest payments under certain circumstances. Specifically, if the gross receipts of the properties securing the loans during any fiscal year exceed an amount determined by dividing the amount of interest otherwise due during that period by 10%, and additional interest payment equal to 10% of such excess is required. At the closing of the transactions contemplated by the Debt Restructure, the personal guarantees of Messrs. Boyd, Mueller and Deutsch with respect to all obligations of the Company to EPR will be released, and all obligations of the Company to EPR will be guaranteed by certain of the Company's subsidiaries.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001518913_dermtech_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001518913_dermtech_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001528393_zaza_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001528393_zaza_prospectus_summary.txt
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+Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, Dated December 19, 2014 Preliminary Prospectus 212,470 Shares of Common Stock (1) The number of shares of common stock to be outstanding after this offering is based on 12,928,636 shares of common stock outstanding as of November 30, 2014 and excludes, as of November 30, 2014, the following: (a) 1,600,208 shares of our common stock issuable upon conversion of any or all of our $40.0 million in outstanding Convertible Notes at a conversion rate of 40.0052 shares of common stock per $1,000 principal amount of Convertible Note; (b) 3,178,188 shares of our common stock issuable upon the exercise of outstanding warrants with an exercise price of $17.09 per share and that expire on August 21, 2020; (c) 653,268 shares of our common stock available for award under the ZaZa Energy Corporation 2012 Long-Term Incentive Plan; and (d) 940,497 shares of our common stock that may be issued to Todd A. Brooks, John E. Hearn, Jr., Gaston Kearby and entities controlled by each of these individuals in exchange for the outstanding 8.00% Subordinated Notes due 2017 (the Subordinated Notes ) pursuant to exchange agreements dated February 24, 2014 (the Exchange Agreements ). We are offering directly to the investor 212,470 shares of our common stock that were issuable upon the exchange of warrants that were formerly held by the investor. On July 21, 2014, we sold the warrants to the investor to purchase 361,493 shares of common stock at an exercise price of $11.2036 per share (as adjusted for a 1-for-10 reverse stock split effective August 18, 2014) and registered both the warrants and the shares underlying the warrants pursuant to a Rule 424 prospectus. The warrants contained a provision that allowed the investor to exchange the warrants for common stock on a cashless basis using a negotiated Black-Scholes formula. We believe that this formula is subject to a 100% cap, meaning that no more than 361,493 shares of common stock are issuable upon exchange. The investor believes that there is no such cap. Using the Black-Scholes formula without a cap, the number of shares of common stock issuable to the investor upon exchange of the warrants would be greater than 361,493 shares of common stock originally registered. We and the investor have resolved the disagreement regarding the number of shares issuable upon exchange of the warrants and entered into a settlement agreement with respect to this resolution on November 18, 2014. Pursuant to the settlement agreement, we agreed to issue to the investor 1 million shares of our common stock of which 787,530 shares were issued and registered on November 18, 2014. This prospectus covers the additional 212,470 shares of common stock that we are required to issue pursuant to the settlement agreement and in exchange for the warrants. Our common stock is listed on the NASDAQ Capital Market under the symbol ZAZA. On December 18, 2014 the last sale price of our common stock as reported on the NASDAQ Capital Market was $1.46 per share. Investing in our securities involves a high degree of risk. Please see the sections entitled Risk Factors on page 8 of this prospectus, as well as in our periodic reports filed with the Securities and Exchange Commission (the SEC ) and incorporated by reference herein, for a discussion of important risks that you should consider before making an investment decision. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001532543_everyware_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001532543_everyware_prospectus_summary.txt
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+This summary highlights certain information about us, this offering and the information appearing elsewhere in this prospectus. This summary is not complete and does not contain all of the information that you should consider before investing in our common stock. You should read this entire prospectus carefully, including the information referred to under the heading Risk Factors and the financial statements and other information included elsewhere in this prospectus, before making an investment decision. Except where the context otherwise requires or where otherwise indicated, the terms EveryWare , we, us, our, our company and our business refer to EveryWare Global, Inc., in each case together with its consolidated subsidiaries as a combined entity. Overview The Company, a Delaware corporation formed in 2011, is a leading marketer of tabletop and food preparation products for the consumer, foodservice and specialty markets. We offer a comprehensive line of tabletop and food preparation products, such as bakeware, beverageware, serveware, storageware, flatware, dinnerware, crystal, banquetware and hollowware; premium spirit bottles; cookware; gadgets; candle and floral glass containers; and other kitchen products. We market our products globally under the Anchor Hocking , Anchor , Anchor Home , FireKing , ONEIDA , Buffalo China , Delco and Sant Andrea brands. Our customers range from Fortune 500 companies to medium and small-sized companies in the consumer, foodservice, business-to-business and e-commerce channels. We own and operate two glass manufacturing plants in the U.S., in Lancaster, Ohio, and Monaca, Pennsylvania. We also source a variety of tableware products from third parties, primarily in Asia and Europe. Summary Risk Factors There are a number of risks related to our business and our common stock that you should consider before making an investment decision. You should carefully consider all the information presented in the section entitled Risk Factors in this prospectus and the other information contained in this prospectus. Some of the principal risks related to our business include the following: slowdowns in the retail and foodservice industries could adversely impact our results of operations, financial condition and liquidity; our operations and financial performance are directly impacted by changes in the economy, and even positive changes in macroeconomic trends may not result in an immediate increase in demand for our products; if we continue to experience liquidity constraints, we could require additional sources of capital to fund our operations or service our indebtedness; and unexpected equipment failures or facility shutdowns would negatively impact our financial performance. These and other risks are more fully described in the section entitled Risk Factors in this prospectus. If any of these risks actually occurs, our business, financial condition or results of operations could be materially and adversely affected. As a result, you could lose all or part of your investment. Company History Our principal operating subsidiaries, Oneida Ltd. ( Oneida ) and Anchor Hocking, LLC ( Anchor Hocking ), were founded in 1848 and 1873, respectively. Investment funds affiliated with Monomoy Capital Partners acquired Anchor Hocking in 2007 and Oneida in 2011 and integrated both companies under EveryWare Table of Contents The information in this prospectus is not complete and may be changed. The selling stockholders may not sell or offer these securities until the registration statement filed with the Securities and Exchange Commission is declared effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to completion, dated October 29, 2014 PROSPECTUS 2,567,173 Shares of Common Stock of EveryWare Global, Inc. This prospectus relates to the sale by the selling stockholders (the selling stockholders ) named herein of up to 2,567,173 shares of our common stock, par value $0.0001 per share (the common stock ), issued or issuable to such selling stockholders upon exercise of warrants at an exercise price of $0.01 per share, subject to adjustment pursuant to the terms of the warrants. Our registration of the common stock covered by this prospectus does not mean that the selling stockholders will offer or sell any of the common stock. The common stock offered by this prospectus may be sold from time to time by the selling stockholders in a number of different ways and at prevailing market prices. See Principal and Selling Stockholders and Plan of Distribution beginning on pages 91 and 107, respectively. The common stock offered by this prospectus was issued or is issuable upon exercise of warrants issued in transactions exempt from registration under the Securities Act of 1933 (the Securities Act ), as amended. We will not receive any cash proceeds from the sale of common stock by the selling stockholders. We will pay the expenses of registering the common stock. Our common stock is listed on the NASDAQ Global Market under the symbol EVRY. The last reported sale price of our common stock on October 28, 2014 was $1.60 per share. Investing in our common stock involves a high degree of risk. These risks are described under the caption Risk Factors that begins on page 9 of this prospectus. Neither the United States Securities and Exchange Commission (the SEC ), nor any state securities commission has approved or disapproved of the common stock that may be offered under this prospectus, nor have any of these regulatory authorities determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2014. Table of Contents ABOUT THIS PROSPECTUS You should rely only on the information contained in this prospectus or contained in any prospectus supplement or free writing prospectus filed with the SEC. If any statement in one of these documents is inconsistent with a statement in another document having a later date for example, a subsequently filed document in this prospectus the statement in the document having the later date modifies or supersedes the earlier statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus. We and the selling stockholders have not authorized anyone to provide you with any different or additional information other than that contained in this prospectus and the accompanying prospectus. We and the selling stockholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may provide. Neither we, nor the selling stockholders are making an offer to sell our common stock in any jurisdiction where the offer or sale is not permitted. You should not assume that the information appearing in this prospectus is accurate as of any date other than the date of the applicable document. Our business, financial condition, results of operations and prospects may have changed since that date. This prospectus does not constitute an offer, or an invitation on our behalf, to subscribe for and purchase any of the securities, and may not be used for or in connection with an offer or solicitation by anyone, in any jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. EBITDA and Adjusted EBITDA have been presented in this prospectus and are supplemental measures of financial performance that are not required by, or presented in accordance with, U.S. generally accepted accounting principles ( GAAP ). For a full description of EBITDA and Adjusted EBITDA and a reconciliation of EBITDA and Adjusted EBITDA to net loss, the most directly comparable GAAP measure, see note 7 to Summary Summary Historical Consolidated Financial Information. Table of Contents in March 2012. The combined company now offers a comprehensive tabletop solution to consumer and foodservice customers. Prior to May 2013, the Company was a publicly traded special purpose acquisition corporation called ROI Acquisition Corp. ( ROI ). In connection with the business combination with ROI in May 2013 (the Business Combination ), EveryWare became a wholly owned subsidiary of ROI and ROI changed its name to EveryWare Global, Inc. Corporate Information Our principal executive offices are located at 519 North Pierce Avenue, Lancaster, Ohio 43130, and our telephone number is (740) 687-2500. Our website address is www.everywareglobal.com. The information found on our website is not part of this prospectus. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001534099_american_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001534099_american_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights some information from this prospectus, and it may not contain all the information important to making an investment decision. A potential investor should read the following summary together with the more detailed information regarding the Company and the common stock being sold in this offering, including Risk Factors and the financial statements and related notes, included elsewhere in this prospectus. The Company History The Company was formerly a development stage company (recently exiting that status) that intends to improve health and wellness by providing access to innovative diagnostics and treatment for patients with pain and other medical conditions. The Company plans to implement its business by managing a profitable medical device product development business coupled with a healthcare service business that provides a protocol and pathway for the adoption and implementation of Low Level Light Therapy (LLLT). The Company was incorporated in the State of Delaware in September 2011, and was formerly known as Amberwood Acquisition Corporation ( Amberwood ). Amberwood was a blank check corporation originally formed to engage in a merger or acquisition with an unidentified company. In March 2012, the Company implemented a change of control by issuing shares to new shareholders, redeeming shares of existing shareholders, electing new officers and directors and accepting the resignations of its then existing officers and directors. Prior to that, on February 23, 2012, the shareholders of the Company and the board of directors unanimously approved the change of the Company's name (Amberwood) to BioLaser Technology Inc. Subsequently, the name of the Company was changed from BioLaser Technology Inc. to American Laser Healthcare Corporation in March 2012. On October 29, 2012, the Company filed a Form 8-K to report that the Company ceased to be a shell corporation as of July 23, 2012. In 2012, the Company acquired certain assets of Macbeam, Inc., a private LLLT company which has an FDA cleared device, the MB Bioenergy Light Therapy System (MB-System), with insurance reimbursement codes. In connection with this acquisition, the Company secured the exclusive assignment to the Company of the U.S.-approved patent for the device and the methodology owned by Bia Mac and Theresa Quach. The Company possesses the exclusive rights to the patented medical device and methodology, the MB Bioenergy Light Therapy System. The patented device also has US FDA clearance through Amest Corporation who owns the FDA clearance with 510k registration K030275. Amest Corporation, the manufacturer of the MB-System, originally applied to the FDA for 510k registration K030275 which was granted to Amest Corporation on November 29, 2004. On January 2, 2013, Amest Corporation and the Company signed an exclusive value added reseller (VAR) agreement, whereby Amest agreed to transfer the ownership of the 510k registration to the Company in exchange for a promissory note. Thus, the Company will become the manufacturer of the MB-System. LLLT has associated insurance reimbursement codes to allow payment for treatment using prescription-only devices such as the MB-System . The Company is located at 1 Technology Drive, Suite I-807, Irvine, California 92618. The Company s main phone number is (949) 873-8899. Business The Company plans to create and manage a medical device product development business coupled with a healthcare service business for the adoption and implementation of Low Level Light Therapy (LLLT). The Company has limited revenue producing operations to date. The Company intends to develop numerous projects as opportunities become available. The Company purchased certain assets of an LLLT company and has begun developing and marketing such LLLT medical devices. The Company believes that fields of innovative diagnostics and treatment choices for patients suffering from pain and other common medical conditions are rapidly changing and developing with new devices and techniques continuously introduced. The Company believes that it can assist in improving health and wellness by providing access to some of these innovative diagnostics and treatments by creating and managing a profitable medical device product development business coupled with a healthcare service business focusing on providing a pathway for the adoption and implementation of Low Level Light Therapy. The Company plans to develop and market its innovative LLLT medical devices and therapy modalities, designed initially for patients with pain and sports injuries but eventually across a number of other medical conditions. The Company s management believes that the cost of the system and its ease of use are superior to existing competing products of electro-stimulation, thermal therapy and physical manipulation as the highly effective system is set and forget , very safe, and requires minimal training to operate. The Company is the owner of the patented MB System, one of the few LLLT medical devices that possess an FDA clearance and insurance reimbursement codes to allow billing for therapy. The Company will initially focus on nursing homes that currently bill for pain management services. The Company will also market into the in home healthcare providers where reimbursement for pain management is accepted. The Company also plans to develop a product roadmap that will sequence the many different treatment protocols of the MB Bioenergy Light Therapy System. Ultimately, the Company intends to develop multiple product offerings that are additional to its current offering, and will allow opportunities to multiply the Company s revenue opportunities at a rate limited only by the Company s ability to obtain additional FDA clearances With a letter to file allowing commercialization with clarification to use statement (issued internally by the Company, as in accordance with applicable FDA guidelines), the MB Bioenergy Light Therapy System is also considered safe and effective for treating surface wounds, in addition to pain management. Based on the specific product code, product classification and as documented in the clearance letter, the United States Food and Drug Administration concluded that the product has been tested to support compliance with industry standards, and therefore raises no new issues of safety and efficacy. Nursing homes are monitored for pressure wound occurrence and appear well-suited to adopt this technology. The Company expects that wound care could create additional sales opportunities. Risks and Uncertainties facing the Company The Company has very limited operating history and is expected to experience losses in the near term. The Company needs to create a source of revenue or locate additional financing in order to continue its developmental plans. As a new company, management of the Company must build and market its initial development and marketing plans in order to execute the business plan of the Company. One of the biggest challenges facing the Company will be in securing revenue opportunities for the Company. In addition, a major challenge will be implementing effective sales, marketing and distribution strategies to reach the intended customers of the Company s product. The Company has considered and devised its initial sales, marketing and advertising strategy, however, the Company will need to skillfully implement this strategy in order to achieve success in its business. Moreover, while the Company maintains a patent and intellectual property protection, competing technology and products could develop and the Company may also be forced to prosecute and/or defend patent and other intellectual property lawsuits. Due to financial constraints and the early stage of the Company s life, the Company has to date conducted very limited advertising and marketing to reach potential customers. In addition, the Company has raised certain private capital; however, more capital is likely to be needed in order to develop the Company s business and operations. If the Company were unable to locate such financing and/or later develop strong and reliable sources of potential customers and a means to efficiently reach customers, it is unlikely that the Company could develop its operations to return revenue sufficient to further develop its business plan. Moreover, the above assumes that the Company s products are met with customer satisfaction in the marketplace and exhibits steady success amongst the potential customer base, neither of which is currently known or guaranteed. Due to these and other factors, the Company s need for additional capital, the Company s independent auditors have issued a report raising substantial doubt of the Company s ability to continue as a going concern. Trading Market Currently, there is no trading market for the securities of the Company. The Company intends to work with market-makers for its securities that will apply for quotation of its common stock on the OTC Bulletin Board. However, the Company does not know if any such application will be made and whether it will be successful if made, how long such application will take, or, that if successful, that a market for the common stock will ever develop or continue on the OTC Bulletin Board. There can be no assurance that the Company will qualify for quotation of its securities on the OTC Bulletin Board. See RISK FACTORS and DESCRIPTION OF SECURITIES . The Offering The maximum number of Shares that can be sold pursuant to the terms of this offering is 3,705,500. The offering will terminate twenty-four (24) months from the date of this prospectus unless earlier fully subscribed or terminated by the Company. This prospectus relates to the offer and sale by certain shareholders of the Company of up to 3,705,500 Shares (the Selling Shareholder Shares ). The selling shareholders, who are deemed to be statutory underwriters, will offer their shares at a price of $1.00 per share, until the Company's common stock is listed on a national securities exchange or is quoted on the OTC Bulletin Board (or a successor); after which, the selling shareholders may sell their shares at prevailing market or privately negotiated prices, including (without limitation) in one or more transactions that may take place by ordinary broker's transactions, privately-negotiated transactions or through sales to one or more dealers for resale. Common stock outstanding before the offering 9, 349 ,500 Common stock for sale by selling shareholders 3,705,500 Common stock outstanding after the offering 9, 349 ,500 Offering Price $1.00 per share Proceeds to the Company $0 (1) Based on number of shares outstanding as of the date of this prospectus. Summary Financial Information The statements of operations data for the period from January 1, 2012 to September 30, 2012, the year ended September 30, 2013 , and the balance sheets as of September 30, 2013 and September 30, 2012, are derived from American Laser Healthcare Corporation s, formerly known as Amberwood Acquisition Corporation, audited financial statements and related notes thereto included elsewhere in this prospectus. The statement of operations data for the three months ended December 31, 2013, and the balance sheet at December 31, 2013, provided below are derived from the unaudited financial statements of American Laser Healthcare Corporation and related notes thereto included elsewhere in this prospectus. Three months ended Year ended January 1, 2012 December 31, 2013 September 30, 2013 through September 30, 2012 (unaudited) Statement of operations data Revenue $ 232,435 $70,000 $0 Net income (loss) $4,834 $(776,811) $(78,858) At December 31, 2013 At September 30, 2013 At September 30, 2012 (unaudited) Balance sheet data Cash $ 65,379 $30,915 $71,824 Other assets $ 147,233 $108,730 $66,250 Total assets $ 212,612 $139,645 $138,074 Total liabilities $ 422,604 $354,471 $199,882 Total stockholders deficit $(209,992) $(214,826) $( 61,808)
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001537293_av_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001537293_av_prospectus_summary.txt
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@@ -0,0 +1 @@
+Prospectus Summary This summary highlights information contained elsewhere in this prospectus. You should read the entire prospectus carefully, including the section entitled Risk Factors before deciding to invest in our common stock. About Us AV Therapeutics, Inc. (the Company ) is a Delaware corporation formed on November 14, 2011 under the name Aquino Milling Inc. Under its initial business plan, the Company intended to purchase rice milling equipment and commence rice milling operations. On June 10, 2013, the Company changed its name to Code 2 Action, Inc. On July 30, 2013, the Company changed its name to Merica Corp. The Company was unable to implement its business plan. Prior to the Reverse Acquisition (discussed below), Merica did not have any active business. On December 13, 2013 (the Closing Date ), the Company entered into and closed an Agreement and Plan of Merger (the Merger Agreement ), with AVT Acquisitions, Inc., a Delaware corporation and a wholly-owned subsidiary of the Company (the Subsidiary ) and Advanced Vaccine Therapeutics, Inc., a Delaware corporation (formerly known as AV Therapeutics, Inc.) ( AVT ). Pursuant to the Merger Agreement, (i) the Subsidiary merged into AVT, such that AVT became a wholly-owned subsidiary of the Company, and (ii) the Company issued 58,000,000 shares (the Acquisition Shares ), of the Company s common stock to the shareholders of AVT, in exchange for the cancellation of all of the issued and outstanding shares of common stock of AVT. Effective on the Closing Date, pursuant to the Merger Agreement, AVT became a wholly owned subsidiary of the Company. The acquisition of AVT is treated as a reverse acquisition (the Reverse Acquisition ), and the business of AVT became the business of the Company. At the time of the Reverse Acquisition, Merica was not engaged in any significant active business. In connection with the Reverse Acquisition, from December 2013 to April 2014, the Company entered into and closed subscription agreements with accredited investors (the Investors ), pursuant to which the Company sold an aggregate of 6,300,000 shares of common stock for an aggregate purchase price of $1,260,000 (the Private Placement ). The Company also issued to the Investors five-year warrants to purchase an aggregate of 3,150,000 shares of common stock with an exercise price of $0.40. The warrants may be exercised on a cashless basis if there is no effective registration statement for the shares of common stock issuable upon exercise thereof. We are primarily engaged in the business of developing cancer therapeutics and immunotherapeutic vaccines that can be used together with prevalent treatment modalities such as chemotherapy and radiation to treat active disease and to prevent metastases and recurrence. We have purchased the exclusive rights to a patented chemotherapeutic drug called Capridine that has been shown in preclinical models to have specific activity against prostate and colon cancer. This drug is expected to be the front line AVT product specifically in prostate cancer where limited chemotherapy is available at the present time. Our immuno-therapeutics is based on the ability of certain proprietary reagents to re-educate or reprogram a failed immune system that can target previously unidentified micro-metastases. We intend to clinically develop both of these approaches independently specifically for prostate cancer. This drug was developed and patented by certain scientists on behalf of New York Medical College, including Dr. Raj Tiwari, AVT s Chief Scientific Officer, who is also a professor at New York Medical College. The drug patents were thus issued to New York Medical College. AVT subsequently purchased an exclusive license to the drug, including the exclusive right to commercialize the drug. For the three months ended March 31, 2014 and March 31, 2013, we incurred net losses of $399,946 and $101,802, respectively. For the years ended December 31, 2013 and 2012 we incurred net losses of $905,920, and $286,271, respectively. As of March 31, 2014, we have an accumulated deficit of $5,136,813, a stockholders deficiency of $982,292 and a working capital deficiency of $1,125,816. Our independent registered public accounting firm has included in its report as of and for the years ended December 31, 2013 and 2012 an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. References to we , us , our and similar words refer to the Company and its wholly-owned subsidiary, AVT, unless the context otherwise requires, and prior to the effectiveness of the Reverse Acquisition, these terms refer to AVT. References to Merica refer to the Company and its business prior to the Reverse Acquisition. About This Offering This prospectus includes (i) 6,300,000 shares of common stock issued in the Private Placement, (ii) 3,150,000 shares of common stock issuable upon exercise of warrants issued in the Private Placement, (iii) 36,596 shares issued in exchange for cancellation of debt, (iv) 2,248,685 Acquisition Shares, (v) 2,894,367 shares issued to certain selling stockholders for services (including 1,088,480 shares issued for placement agent services in connection with the Private Placement), and (vi) 212,500 shares of common stock issuable upon exercise of warrants issued to certain selling stockholders for services (including 50,000 warrants issued for placement agent services in connection with the Private Placement). Table of Contents Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): o Large accelerated filer o Accelerated filer o Non-accelerated filer x Smaller reporting company CALCULATION OF REGISTRATION FEE Title of Class of Securities to be Registered Amount To be Registered Proposed Maximum Aggregate Price Per Share (2) Proposed Maximum Aggregate Offering Price Amount of Registration Fee Common Stock, $0.0001 par value per share (1) 11,479,648 shares $ 0.15 $ 1,721,947.20 $ 221.78 Common Stock, $0.0001 par value per share (3) 3,362,500 shares $ 0.15 $ 504,375 $ 64.96 Total number of securities to be registered 14,842,148 shares $ 2,226,322.20 $ 286.74 (1) Represents outstanding shares of common stock offered by the selling stockholders. (2) Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(c) under the Securities Act of 1933, as amended, using the average of the high and low prices as reported on the OTCQB on July 11, 2014. (3) Represents shares of common stock issuable upon exercise of outstanding warrants, offered by the selling stockholders. The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001539042_bluenrgy_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001539042_bluenrgy_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001539892_committed_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001539892_committed_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001545391_tcp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001545391_tcp_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001545391_tcp_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001552192_northern_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001552192_northern_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..f79c3eb02707f8e9789206214e930020d99555d1
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read this entire prospectus carefully, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our historical financial statements and related notes included elsewhere in this prospectus. In this prospectus, unless the context provides otherwise, the terms the Company, we, us, and our refer to Northern Wind Energy Corp. Overview and Corporate History Northern Wind Energy Corp. is a development stage company incorporated in the state of Nevada on January 18, 2008 for the purpose of marketing, distributing and installing small wind turbine systems and related equipment for electrical power generation. As of the date of this prospectus, our operations have principally involved the purchase of one residential solar power purchase agreement which includes the design, permitting, construction, installation, testing and activation of a solar photovoltaic system. In the future, however, we plan to focus the majority of our resources on the wind turbine industry. We have generated $ 942 revenue from January 18, 2008 (date of inception) through December 31 , 2013 . However, we have not collected any revenue. Our auditors, in their report dated March 10, 2014 , expressed substantial doubt about our ability to continue as a going concern. On July 19, 2012, we filed amended and restated articles of incorporation in order to, among other things, change our authorized shares of capital stock to 200,000,000 shares of common stock and 50,000,000 shares of preferred stock from 75,000,000 total authorized shares of capital stock, change the par value of our common and preferred stock to $0.0001 per share from $0.001 per share, allow for the indemnification of our directors, officers, employees or agents to the fullest extent permitted by the Nevada Revised Statutes, eliminate the individual liability of our directors and officers to the fullest extent permitted by the Nevada Revised Statutes and provide for our board of directors to issue series and classes of preferred stock with different features. On November 7, 2013, we filed a certificate of amendment to our amended and restated articles in order to change our name to Northern Wind Energy Corp. from Icarus Wind Energy, Inc. The Offering Common stock offered by selling stockholders This prospectus relates to the sale by certain selling stockholders of 9,441,955 shares of our common stock sold to investors in private placement transactions in 2010, 2011 and 2012 Offering price $0.10 per share until a market develops and thereafter at market prices or privately negotiated prices Common stock outstanding before and after the offering 112, 165,092 shares (1) Use of proceeds We will not receive any proceeds from the sale of the common stock by the selling stockholders Market for the common stock There is no market for our securities. Our common stock is not currently listed for trading on any exchange. It is our intention to seek quotation on the OTC Bulletin Board but an application to trade our common stock has not been filed by a market maker on our behalf as of the date of this prospectus. There can be no assurances that our common stock will be approved for trading on the OTC Bulletin Board, or any other trading exchange. There is no assurance that a trading market will develop, or, if developed, that it will be sustained. Therefore, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale. Risk Factors You should carefully consider the information set forth in this prospectus and, in particular, the specific factors set forth in the Risk Factors section beginning on page 2 of this prospectus before deciding whether or not to invest in our common stock. ___________________________ (1) Represents the number of shares of our common stock outstanding as of March 10, 2014 . Emerging Growth Company Status We are an emerging growth company as defined in the Jumpstart Our Business Startups Act, or JOBS Act. For as long as we are an emerging growth company, unlike other public companies, we will not be required to: provide an auditor s attestation report on management s assessment of the effectiveness of our system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002; comply with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer; comply with any new audit rules adopted by the PCAOB after April 5, 2012, unless the Securities and Exchange Commission determines otherwise; provide certain disclosure regarding executive compensation required of larger public companies; or obtain shareholder approval of any golden parachute payments not previously approved. We will cease to be an emerging growth company upon the earliest of: when we have $1.0 billion or more in annual revenues; when we have at least $700 million in market value of our common units held by non-affiliates; when we issue more than $1.0 billion of non-convertible debt over a three-year period; or the last day of the fiscal year following the fifth anniversary of our initial public offering. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1), which will allow us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. As a smaller reporting company, all of the JOBS Act exemptions are available to us. Transactions Pursuant to which the Selling Shareholders Acquired their Shares The selling stockholders purchased an aggregate of 9,441,955 shares in private placement transactions in 2010, 2011 and 2012 that were exempt under the registration provisions of the Securities Act of 1933, as amended. We received a total consideration of $20,720 from the sale of these shares. Business Address and Telephone Number Our address is 3665 Merrick Road, Seaford, New York 11783 and our telephone number is ( 516) 783-9600.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001554955_rockford_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001554955_rockford_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..bf99765a4b33bd9c4cfb193b41ca74f89c9a1271
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights selected information from this prospectus and may not contain all the information that is important to you. To understand our business and this offering fully, you should read this entire prospectus carefully, including the financial statements and the related notes beginning on page F-1. This prospectus contains forward-looking statements and information relating to Rockford Oil Corp. See Cautionary Note Regarding Forward Looking Statements on page 8. Our Company The Company was formed on March 22, 2012 and on May 14, 2012 we closed the acquisition of a 35% working interest (WI) in the Sanders oil and gas leases in Stafford County KS. The Sanders lease is comprised of two gross productive wells with 35% WI in each, the Sanders #5 and the Sanders #6. The gross acreage of the lease is 160 acres with 28 net acres developed and 28 net acres of undeveloped acreage. The lease also has a non-productive Salt Water Disposal Well (SWD), the Sanders #3. The Sanders #5 and #6 had not produced since September of 2011. This lease was purchased for future exploration and drilling, not for the production from these two wells. The total price for 100% WI of the Sanders lease was $280,000 which included $55,000 for a complete facility upgrade. Our 35% WI was $98,000 and paid. On August 30, 2012, the Company engaged Lasso Energy LLC as the operator of our wells. The Sanders lease had been producing from the Mississippian since 1965. Early in the life of the lease, wells 1 through 6 were oil producers. Wells 1 and 3 were converted to injection wells, either for enhanced oil recovery or disposal. Wells #2 and #4 were plugged and abandoned. The production from the two producing wells, in 2013, together has averaged 53.90 Barrels of Oil Per Month (BOPM). On May 14, 2012 we purchased a 20% working interest in the Asmussen oil and gas lease in Butler County KS of approximately 80 acres with two minimally producing oil wells, the Asmussen #16-2 well and the Asmussen #16-1, together with any personal property and lease equipment located thereon. The #16-1 well had been producing 0.5 barrels of oil per day BOPD and the 16-2 was producing 2.25 BOPD. The Asmussen lease has been producing from the Arbuckle formation since 1965. The production data reported on the KGS website was listed under two leases, the Amussen (1956 - 1989) and the Asmussen 16-1 (2008 - 2012). On July 18, 2012 the #16-1 well was successfully converted to a SWD well. The purchase price for 100% WI of the Asmussen Lease was $496,000 and included $218,000 for a complete work over of the wells and tank batteries. Our 20% WI was $99,000 and paid. On November 1, 2012 Lasso issued an Authorization for Expenditure (AFE) of $27,000 to perform a Doc Squeeze on the #16-2 well where a mixture of cement and diesel fuel is pumped down the well bore to seal leaks. Our 20% WI required us to pay $5,500 and was paid. On April 4, 2013 the 16-2 was plugged and abandoned and On June 7, 2013, the Asmussen 16-3 was drilled at a cost to the Company of $59,334 for our 20% and was paid. The pumping equipment from 16-2 was moved to the 16-3. The production from the 16-2 and 16-3 wells, in 2013, together has averaged 12.45 Barrels of Oil Per Month (BOPM). On August 30, 2012 the Company purchased a 15% working interest in the Anderson oil and gas lease in Barton County, KS of approximately 160 acres with two producing oil wells, the Anderson #7 well and the Anderson #4 well, and an SWD, the Anderson #8 well. The Anderson lease has been producing from the Arbuckle formation since 1956. There are three (3) active producers, the #4, #7and #9, and a salt water disposal well, the #8. Wells #1, #2, and #6 have been plugged and abandoned. The Anderson #9 was completed March 15, 2013 and we participated for 15% of the cost and paid $64,638. The production from the three producing wells, in 2013, together has averaged 213.75 Barrels of Oil Per Month (BOPM). For December 31, 2013 management commissioned a comprehensive Reserve Report from Melland Engineering, Inc James E. Melland, PE, PG based in McPherson, Kansas. The author of this report, James Melland, is a licensed Professional Petroleum Engineer in California (#P1806) and Kansas (#17848), a licensed Professional Geologist in California (#7166), has a Bachelor of Science degree in Geological Engineering from the University of Missouri-Rolla and has over twenty-five (25) years of geological and petroleum engineering experience in the oil and gas industry. This reserve report is dated December 31December 31, 2014 and is included as an exhibit to this filing. No aspect of the remuneration to Melland was contingent upon or related to the results or conclusion reached by the Melland Reserve Report. Melland owns no interest in the lease or wells associated with the report. The Company has nineteen gross wells of which three are SWD, ten were plugged and abandoned and six are net producing wells. All the interests in acreage held by the Company are secured by production. The report states the reserves for all of Rockford Oil Corp.'s (ROC) oil and gas properties, which are located in Barton, Butler, and Stafford County, Kansas (Table 1) as of December 31, 2013. The Anderson Lease is in Barton County and consists of 160 acres, three (3) producing wells and one (1) salt water disposal well (SWD). The Asmussen lease is in Butler County and consists of 80 acres, one (1) new oil well, and one (1) SWD. The Sanders lease is in Stafford County and consists of 160 acres, two (2) producing wells and one (1) SWD well. Producing Wells the following table sets forth the Company s gross and net productive wells at December 31, 2013. Gross wells are the total in which the Company has an interest, while net wells are the sum of the fractional interests owned. OIL WELLS GROSS NET Barton County KS 3 0.45 Butler County KS 1 0.20 Stafford County KS 2 0.70 TOTAL 5 1.35 Acreage The following table sets forth the Company s gross and net developed and undeveloped acreage as of December 31, 2013. Gross average represents the Company s direct ownership and net acreage represents the sum of the fractional interests owned. DEVELOPED ACREAGE UNDEVELOPED ACREAGE GROSS NET GROSS NET Barton County KS 53.33 8 35.55 5.33 Butler County KS 80 16 0 0 Stafford County KS 80 56 80 56 TOTAL 213.33 80 115.55 61.33 Business Strategy The Company s business strategy is to actively explore and develop the Oil Projects described above. The Company shall continue to be deemed an emerging growth company until the earliest of-- (A) the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; (B) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title; (C) the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or (D) the date on which such issuer is deemed to be a large accelerated filer , as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto. . As an emerging growth company the company is exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company the company is exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. The Company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. Our executive offices are located at 7230 Indian Creek Ln., Ste. 201, Las Vegas, NV 89149. Our telephone number is (702) 839-4029. The Offering This prospectus covers up to 1,910,000 shares held by selling shareholders to be sold at the fixed price of $0.10 per share until such time as the issuer is traded on the OTCBB and thereafter at prevailing market prices. ABOUT THIS OFFERING Securities Being Offered Up to 1,910,000 shares of common stock of Rockford Oil Corp. to be sold by selling shareholders at a fixed price of $0.10 per share until the stock is traded on the OTCBB or other exchange and thereafter at market prices or privately negotiated prices. Initial Offering Price Up to 1,910,000 shares of common stock of Rockford Oil Corp. to be sold by selling shareholders at a fixed price of $0.10 per share until the stock is traded on the OTCBB or other exchange and thereafter at market prices or privately negotiated prices. Terms of the Offering The selling shareholders will sell at a fixed price of $0.10 per share until the stock is traded on the OTCBB or other exchange and thereafter at market prices or privately negotiated prices. Termination of the Offering The offering will conclude when the selling shareholders have sold all of the 1,910,000 shares of common stock offered by them.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001555995_bioscience_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001555995_bioscience_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..6c42ccec6160ecb2b7349cc776349ca1ad9c9807
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary only highlights selected information contained in greater detail elsewhere in this Prospectus. This summary does not contain all of the information that you should consider before investing in our common stock. You should carefully read the entire Prospectus, including Risk Factors beginning on Page 4, and the consolidated financial statements, before making an investment decision. Corporate Background and Business Overview JobLocationMap Inc. is a development stage company. We were incorporated under the laws of the state of Nevada on June 15, 2010 and are engaged in the development visual job search service that will put together job seekers and employers, JobLocationMap.com. Our fiscal year end is December 31, and we have no subsidiaries. Our social networking website aims to provide job seekers and employers with a platform to share their a valid address and contact information to be shown as a pin on our provided map, manage their their job description or their resume, and interact with a community of Job searcher and employers from around the world. Our business offices are currently located at 153 W. Lake Mead Pkwy #2240, Henderson, NV 89015. Our telephone number is 1-702-586-1138. We have a website located at www.JobLocationMap.com, however, the information contained on our website does not form a part of the registration statement of which this prospectus is a part. From our inception on June 15, 2010 to the present date, we have focused on organizational matters. Since Aug 2012 we have been developing our social networking website for JobLoactionMap searchers, www.JobLocationMap.com. Our website is currently in the development stage. We expect our website to be ready for public launch within 6 months following successful completion of this Offering, provided that we have correctly estimated the funds required to execute our business plan. If we are successful in completing and launching our website, we anticipate that we will generate nominal revenues within 4 to 6 months following the website launch. The Company has already begun developing its website and has contracted with a consultant to prepare such site. The Company has a set business plan which does not include the merger or acquisition with any other entity. We have two executive officers, Mr. Omri Morchi and Ms. Eden Shoua, who also serve as our directors. Both Mr. Morchi and Ms. Shoua, reside in Israel. Mr. Morchi, our President and director, is a professional job hunter with more than 5 years of experience as a Job hunter working at the AllJobs, the fourth largest Jobs website in Israel. Ms. Eden, our Secretary, Treasurer, and director, has 5 years of general business management, marketing, and logistics experience working in the public education sector. We are a development stage company that has generated no revenues and has had limited operations to date. From June 15, 2010 (date of inception) toDecember 31 2013 we have incurred accumulated net losses of $14,200. As of December 31, 2013, we had $9,800 in current assets and current liabilities of $0. We have sold and issued an aggregate of 8,000,000 shares of our common stock since our inception through the private placement of our common stock exclusively to our officers and directors, Mr. Omri Morchi and Ms. Eden Shoua, for total proceeds of approximately $24,000. Since our inception we have not made any significant purchase or sale of assets, nor have we been involved in any mergers, acquisitions or consolidations. Due to the uncertainty of our ability to meet our current operating and capital expenses, our independent auditors have included a going concern opinion in their report on our audited financial statements for the period ended December 31, 2013. The notes to our financial statements contain additional disclosure describing the circumstances leading to the issuance of a going concern opinion by our auditors. The Company is an emerging growth company under the Jumpstart Our Business Startups Act. The Company shall continue to be deemed an emerging growth company until the earliest of-- (A) the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; (B) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title; (C) the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or (D) the date on which such issuer is deemed to be a large accelerated filer , as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto. . As an emerging growth company the company is exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company the company is exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. The Company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. Even if we no longer qualify as an emerging growth company under the JOBS Act, so long as we remain a smaller reporting company we will be permitted to use the scaled disclosure requirements for executive compensation and will be exempt from having to provide an attestation report on your internal control over financial reporting. Funds from this offering will be placed in a account and not available for use until the full offering is sold. Summary of the Offering Shares of common stock being offered by the Registrant: 1,500,000 shares (the Maximum Offering ) of the Registrant s common stock. Offering price: $0.04 per share of common stock. Number of shares outstanding before the Offering: As of November 15, 2013 we had 8,000,000 shares of our common stock issued and outstanding, and no issued and outstanding convertible securities. Number of shares outstanding after the Offering 9,500,000 if all of the shares being offered are sold Market for the common stock: There is no public market for our common stock. After the effective date of the registration statement of which this prospectus is a part, we intend to seek a market maker to file an application on our behalf to have our common stock quoted on the Over-the-Counter Bulletin Board. We may never be approved for trading on any exchange. We currently have no market maker who is willing to list quotations for our stock. There is no assurance that a trading market for our stock will develop be sustained if developed Use of Proceeds: If we are also successful in selling all 1,500,000 shares contained in the Maximum Offering, our gross proceeds will total $60,000 and our net proceeds $47,500.. We intend to use all the proceeds received from this Offering to execute our business plan. There is no escrow of the proceeds of this offering.
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+thereto appearing elsewhere in this prospectus. You should read the following summary together with the more detailed information regarding our company and the ordinary shares being sold in this offering and our consolidated financial statements and notes thereto appearing elsewhere in this prospectus. This prospectus includes forward looking statements that involve risks and uncertainties. See Forward Looking Statements. Mission Our mission is to transform the way consumers in India shop, leveraging technology to provide them with a best in class shopping experience across a wide range of products, delivered to their doorstep. Overview We operate a leading digital commerce platform in India, with a combined reach of over 250 million consumers, accessed through our integrated television, Internet and mobile device channels. We provide Indian consumers with a high quality and integrated shopping experience that combines value, fun, entertainment and simplicity, which we believe to be superior to what is commonly available to them. We are focused on the Indian retail market, which remains highly fragmented and is dominated by small stores with limited availability and selection of high-quality goods. Since the launch of our service in 2008, we have built an end-to-end digital commerce platform providing Indian consumers access to over 1,000 brands, supported by our pan-India delivery reach and dedicated 24/7 multi-lingual customer service. Using our platform, international and domestic brands are able to efficiently and effectively demonstrate, market and sell existing as well as new products to consumers across India. Our position as the largest pan-India television shopping channel (based on publicly available financial information) has enabled us to establish ourselves as a trusted brand, with over 8.9 million consumers who have placed orders with us since our launch. To reach and serve the broadest possible customer base, we have developed a consumer centric platform that combines our television channel with the discovery, research and comparison tools of our Internet and mobile channels. We enable consumers to contact us using multiple languages and dialects spoken across India, enabling us to serve a wide range of consumers. As of December 31, 2013, our television channel, which is carried on pay television systems, reached approximately 69.0 million households across India, while our Internet channel had approximately 9.4 million unique visitors during that month, according to Google Analytics. Our scale and distribution strategy make us an important relationship for the distributors and manufacturers that offer and sell products through our digital commerce platform, whom we refer to as our Sourcing Partners, providing us with the ability to showcase a broad range of products across multiple categories at competitive prices. We have developed a technology-enabled logistics network that allows our Sourcing Partners to deliver products to our customers doorstep in over 3,000 towns and cities across India. We believe that our integrated platform provides consumers across India with a differentiated and user-friendly experience, service and value. India has witnessed substantial economic growth over the past decade, with real gross domestic product growing by 7.3% on an annual compounded rate during the period, according to The Economist Intelligence Unit, or the EIU. This growth has in turn led to the emergence of a large middle class across the country, estimated to encompass approximately 250 million people by 2015 according to a 2007 report of the McKinsey Global Institute. We believe that these consumers, influenced by mass media and becoming increasingly affluent, are seeking to enjoy a modern, uniquely Indian lifestyle which includes fun, easy and accessible shopping as an integral part of everyday life. However, when these consumers shop, they are often frustrated by the gap between the high-quality shopping experience they seek, typically portrayed on popular mass media, and their local, often poor, retail experience. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 10, 2014 PRELIMINARY PROSPECTUS Shares NW18 HSN Holdings Plc Ordinary Shares $ per Ordinary Share This is the initial public offering of our ordinary shares. We are selling ordinary shares, and Network18 Holdings Limited and the other selling shareholders named in this prospectus are selling ordinary shares. We will not receive any proceeds from the sale of ordinary shares by the selling shareholders. We currently expect the initial public offering price to be between $ and $ per ordinary share. We and some of the selling shareholders have granted the underwriters an option to purchase up to additional ordinary shares to cover over-allotments. We have applied to have our ordinary shares approved for listing on the Nasdaq Global Market under the symbol HS. We are an emerging growth company under federal securities laws and may elect to comply with reduced public company reporting requirements. Investing in our ordinary shares involves risks. See Risk Factors beginning on page 15. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Share $ Total $ Public Offering Price $ $ Underwriting Discount $ $ Proceeds to NW18 HSN Holdings Plc (before expenses) $ $ Proceeds to the selling shareholders (before expenses) $ $ The underwriters expect to deliver the ordinary shares to purchasers on or about , 2014, through the book-entry facilities of The Depository Trust Company. Citigroup Credit Suisse , 2014 Table of Contents CONVENTIONS THAT APPLY TO THIS PROSPECTUS We conduct our business principally through our sole subsidiary, TV18 Home Shopping Network Limited, an Indian corporation. In this prospectus, unless otherwise stated or unless the context otherwise requires, references to we, us, our, or our company are to NW18 HSN Holdings Plc and its sole subsidiary collectively, and references to our holding company are to NW18 HSN Holdings Plc on a standalone basis. In this prospectus, references to U.S., the United States or USA are to the United States of America, its territories and its possessions. References to India are to the Republic of India, and references to Cyprus are to the Republic of Cyprus. References to $, dollars or US dollars are to the legal currency of the United States and references to , Rs., rupees or Indian rupees are to the legal currency of India. Solely for the convenience of the reader, this prospectus contains translations of certain Indian rupee amounts into U.S. dollars at specified rates. Except as otherwise stated in this prospectus, all translations from Indian rupees to U.S. dollars are based on the noon buying rate of 61.92 per $1.00 in the City of New York for cable transfers of Indian rupees, as certified for customs purposes by the Federal Reserve Bank of New York on December 31, 2013. No representation is made that the Indian rupee amounts referred to in this prospectus could have been or could be converted into U.S. dollars at such rates or any other rates. Any discrepancies in any table between totals and sums of the amounts listed are due to rounding. The consolidated financial statements and related notes as of March 31, 2012 and 2013 and for the fiscal years ended March 31, 2011, 2012 and 2013 and as of December 31, 2013 and for the nine months ended December 31, 2012 and 2013 included elsewhere in this prospectus have been prepared in accordance with International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board, or IASB. References to a particular fiscal year are to our fiscal year ended March 31 of that year. Our fiscal quarters end on June 30, September 30, December 31 and March 31. References to a year other than a fiscal year are to the calendar year ended December 31. As used in this prospectus, other than in our consolidated financial statements, control of a company means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a company, whether through the ownership of voting securities, by contract or otherwise, as well as the ability to exercise the aforementioned control jointly with an unrelated party, and may include instances where only significant influence is exercised for IFRS purposes. Statements to the effect that one party has control over another, such as Network18 Media & Investments Limited or Mr. Raghav Bahl having control over us, should not be construed as having a particular corresponding meaning for the purposes of our consolidated financial statements or under IFRS more generally. For the purposes of our consolidated financial statements, Network18 Media & Investments Limited has been treated as having joint control over us under IFRS by virtue of certain contractual substantive participative rights an unrelated party enjoyed prior to the completion of this offering. In this prospectus, we refer to the distributors and manufacturers that offer and sell products through our digital commerce platform as our Sourcing Partners. Our use of the term Sourcing Partner does not mean that we have formed any legal partnerships with any of our Sourcing Partners. In this prospectus, references to compound annual growth rate and CAGR are to an annualized measure of growth of a metric over a particular period of time (typically more than one year) that is calculated by annualizing and compounding the net change in the metric from the beginning to the end of the period. As such, CAGR is not a depiction of actual growth over the period but rather a smoothed annualization of such period s net change. In this prospectus, references to SKUs are to stock-keeping units, which are numbers or codes used to identify products or items for sale. A particular product may have more than one SKU ascribed to it, such as when the product may be sold in different colors or with other varying unique features. SKUs are often used by businesses to track inventory or availability of products with identical features. Table of Contents In addition, the Indian market has unique business dynamics and infrastructure challenges that require a technological and commercial retail solution that is different from that found in other parts of the world. India suffers from a lack of adequate logistics infrastructure which, coupled with its vast geographical spread, makes delivery of products to consumers across various towns and cities challenging. Creation of reliable delivery mechanisms requires sizeable investments in technology, systems and logistics infrastructure. Because of the relative lack of large organized retail vendors across the country, infrastructure constraints, and rising costs for physical retail space that currently characterize the local retail market, digital commerce has become an important component for manufacturers and distributors who are seeking to reach and sell their products to Indian consumers on a national basis. Credit card penetration in India continues to be low, and consumers in India are generally reluctant to make payments electronically. Hence, most of the transactions executed through our platform are made on a cash on delivery, or COD, basis as consumers are more comfortable with cash as a mode of payment. In a COD transaction, the consumer makes payment in cash upon receipt of the product. In India, television is benefiting from substantial growth and is the most pervasive and effective digital medium, with a pay television viewer base of over 584 million in 2013, according to Euromonitor International. In addition, India s Internet use, while still at an early stage of development, had 176 million users as of 2013, according to Euromonitor International. We believe that our solution enables us to address the needs and consumption aspirations of the large and growing middle class in India, while providing leading brands with an effective channel to reach these consumers. Our revenue from operations comes primarily from commissions we charge for products sold through our platform. For fiscal years 2011, 2012, and 2013 and the nine months ended December 31, 2013, we reported revenue from operations of $19.2 million, $24.5 million, $40.7 million and $43.5 million, respectively. Our revenue from operations for fiscal year 2013 and the nine months ended December 31, 2013 represent growth of 66.4% and 55.9% from fiscal year 2012 and the nine months ended December 31, 2012, respectively. For fiscal years 2011, 2012 and 2013 and the nine months ended December 31, 2013, the total value of all products sold through our platform, net of related returns, which we refer to as gross transaction value, was $62.6 million, $108.5 million, $166.5 million and $158.8 million, respectively. For fiscal years 2011, 2012 and 2013 and the nine months ended December 31, 2013, our loss after tax was $12.7 million, $22.5 million, $25.8 million and $14.5 million, respectively. For fiscal years 2011, 2012, 2013 and the nine months ended December 31, 2013, our adjusted EBITDA was $(11.4) million, $(20.9) million, $(19.2) million and $(8.2) million, respectively. Adjusted EBITDA is a financial measure not presented in accordance with IFRS. For a definition of adjusted EBITDA, an explanation of our management s use of this measure and a reconciliation of adjusted EBITDA to our loss after tax, see Selected Consolidated Financial and Other Data Adjusted EBITDA. In the nine months ended December 31, 2013, our television segment reported a segment profit of $2.5 million. Our Opportunity The rise of a large Indian middle class, focused on a uniquely Indian yet modern lifestyle is causing a shift in consumer expectations. Indian consumers, influenced by mass media, are seeking a western style shopping experience. As a result, there is growing disparity between consumer expectations and what they typically find when shopping locally, driven by the relative lack of organized retail across the country. Table of Contents Table of Contents In this prospectus, we refer to information regarding the digital commerce industry and our competitors from market research reports, analyst reports, news articles and other publicly available sources, including the United States Central Intelligence Agency World Factbook, or the CIA World Factbook, Internet World Stats, Euromonitor International, McKinsey Global Institute, Indian Brand Equity Foundation and Census of India. We have also reproduced certain data with permission from The Economist Intelligence Unit. See Business for further details. In this prospectus, we refer to various key metrics that we use to evaluate aspects of overall transaction activity in our channels and the financial performance of our business and to aid our strategic planning. These key metrics include cumulative consumer base, gross transaction value, average gross commission, average order value and repeat business rate. See Management s Discussion and Analysis of Financial Condition and Results of Operations Key Operating Metrics for definitions of these metrics. In this prospectus, references to the return rate for products are to the percentage of products that have been returned by consumers as a percentage of the total value of products shipped to consumers in any given period. For the purposes of this metric, we track individual product shipments and assess returns for a particular period even after the end of such period. This assessment of returns differs from that used in gross transaction value. Data presented in this prospectus on the number of unique visitors to our website is sourced from Google Analytics, a service offered by Google Inc. that provides digital marketing intelligence. We use monthly Google Analytics data to track unique user statistics, which measure the total number of unique visitors who have visited our website at least once in a given month. We track unique visitors based on the number of visitors with unique cookies who have visited our website using either a computer or mobile browser. Unique visitors do not include visitors who access our platform through our mobile application. Because the number of unique visitors is based on visitors with unique cookies, an individual who accesses our website from multiple devices with different cookies will be counted as multiple unique cookies, and multiple individuals who access our website with a shared device with a single cookie will be counted as a single unique visitor. Non-IFRS Financial Measure To provide investors with additional information regarding our financial results, we have presented adjusted EBITDA, a non-IFRS financial measure. We define adjusted EBITDA as profit (loss) after tax adjusted to exclude finance income, finance costs, depreciation and amortization, income tax expense and non-cash charges for share based compensation. We have presented adjusted EBITDA in this prospectus because it is a supplement measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, to develop short and long-term operational plans, and to determine bonus payouts. In particular, we believe that the exclusion of the expenses eliminated in calculating adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. We believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. Our use of adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under IFRS. Some of these limitations are as follows: although depreciation and amortization of property and equipment are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; adjusted EBITDA does not reflect: (1) changes in, or cash requirements for, our working capital needs; (2) the potentially dilutive impact of equity-based compensation; or (3) tax payments that may represent a reduction in cash available to us; and Table of Contents Our Value Proposition for Consumers We believe that Indian consumers are looking to transact with a trusted digital shopping brand, offering them a superior shopping experience. Our integrated digital commerce platform leverages our scale, reach and deep industry know-how to offer consumers a comprehensive solution that has the following attributes: Trust. The wide-spread presence of our television channel across India has helped us gain consumer familiarity and trust. Availability. Our television-driven integrated platform allows us to reach over 250 million consumers across the country. This is supported by our technology-enabled delivery and logistics network, which enables us to deliver products to consumers in over 3,000 towns and cities across India, including many of the smaller cities and towns that often lack the presence of organized retail stores, allowing consumers to buy products that may otherwise not be readily available. Service. We place a high emphasis on consumer satisfaction and support. We operate our telephone customer support center 24 hours a day, seven days a week, all year round, with support mainly in Hindi and English, as well as certain other Indian languages. Selection and Quality. We showcase one of the largest selections of brands comprising over 1,000 global and local brands across all major product categories. We provide consumers with a wide choice of high-quality products including a number of unique and innovative products and offerings that may not be easily available otherwise. Value. We believe that by leveraging our volume, reach and logistics network, we provide important economies of scale benefits to our Sourcing Partners, which allows them to offer competitive prices to our consumers. Payment Choices and Flexibility. While a substantial majority of payments made through our platform continue to be made on a COD basis, we offer consumers multiple additional payment options, ranging from credit cards, debit cards, net banking, demand drafts and gift certificates, helping us facilitate consumer acceptance of digital commerce. Our Value Proposition for Sourcing Partners Our digital commerce platform offers Sourcing Partners a single point of access to consumers throughout India and across various demographics by providing them the following advantages: Unique Distribution Platform. Our platform provides our Sourcing Partners an efficient means to bypass the traditional multi-layer supply chain by delivering their products directly to consumers. In addition, our Sourcing Partners benefit from our ability to help them launch new products quickly in the Indian market, leveraging our platform to help educate consumers about new products. As a result, we believe that our Sourcing Partners are able to realize cost savings, improve efficiencies and thereby offer our customers a broader choice of competitively priced products. Nationwide Reach. Through our platform, our Sourcing Partners are able to reach over 250 million consumers. We are able to expand the addressable market for our Sourcing Partners by providing access to customers in markets that may not be reachable through traditional marketing and distribution channels. Branding and Visibility. We offer valuable marketing and product demonstration opportunities for our Sourcing Partners and the brands they carry. We believe that television is the most effective brand building medium in India, enabling our Sourcing Partners to showcase their products and create awareness and visibility on a national level. Table of Contents other companies, including companies in our industry, may calculate adjusted EBITDA or similarly titled measures differently, which reduces its usefulness as a comparative measure. Because of these and other limitations, you should consider adjusted EBITDA along with other IFRS-based financial performance measures, including various cash flow metrics, profit or loss after tax, and our other IFRS financial results. Please see Selected Consolidated Financial Data Adjusted EBITDA and Management s Discussion and Analysis of Financial Condition and Results of Operations Adjusted EBITDA for more information as to the limitations of using non-IFRS measures and for the reconciliation of adjusted EBITDA to our loss after tax, the most directly comparable financial measure calculated in accordance with IFRS. Table of Contents Product Launch. The availability of a multi-channel medium has helped various Sourcing Partners to successfully launch their product offerings to the Indian consumer at a national level, thereby resulting in cost savings and faster speed to market their offerings. Real-time Consumer Feedback. Our digital commerce platform enables an efficient and cost-effective means for product testing, consumer analytics and consumer feedback. Our website offers our Sourcing Partners the opportunity for detailed consumer education through product videos, interactive product evaluation and demonstrations and consumer generated reviews. Our Strengths We believe that the Indian digital commerce opportunity, our integrated multi-channel platform strategy and our strong execution have resulted in the following key strengths for our business: Positioned for Growth Our digital commerce platform addresses the growing Indian consumer market primarily through our television channel as well as our Internet, and mobile channels. An Established and Trusted Brand We have established ourselves as the market leader in television home shopping in India. Through our integrated 24 hour television channel as well as Internet and mobile presence, we have become one of India s best known digital commerce platforms. Large, Engaged and Loyal Consumer Base Since our launch, over 8.9 million consumers have placed orders through our platform, and around 15.3 million transactions have been executed through our platform. Our repeat business rate during the third quarter of fiscal 2014 reached 46.8%, demonstrating the value of our service to our users and the loyalty of our consumer base. Scale Benefits The scale of our operations and our ability to access 250 million consumers in over 3,000 towns and cities across India positions us as one of the leaders in the industry and makes us an important relationship for our Sourcing Partners. Extensive Selection We are able to offer consumers a wide selection of products across multiple categories such as books, mobile phones, cameras, computers, electronics, apparel, jewelry, home & kitchen, appliances, toys, sports & fitness, health & beauty, baby, office stationery and gifts & flowers. Experienced Management Team with Proven Track Record Our management team successfully launched our business in 2008, and they have helped it grow to become one of India s leading digital commerce platforms. With diverse yet complementary backgrounds, the team benefits from deep industry expertise across media, digital commerce, consumer products, retail, logistics and information technology, or IT. We believe that our management team s collective experience and strong execution capabilities have enabled and will continue to enable us to further innovate our offerings and execute our growth strategy. Table of Contents Our Growth Strategy We intend to grow our business by focusing on following our key growth strategies, which include leveraging the strength of our platform and our brand in order to attract new consumers and increasing the number of key Sourcing Partners to facilitate the growth of our platform across geographies and products and further diversify our Sourcing Partner relationships.
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, especially the section in this prospectus entitled Risk Factors beginning on page 10 and our financial statements and the related notes thereto appearing at the end of this prospectus, before making an investment decision. As used in this prospectus, references to we, us, our, our company and Kindred refer to Kindred Biosciences, Inc. References to product candidates, drugs, and compounds refer to both small molecules and biologics. Overview Our Company We are a development stage biopharmaceutical company focused on saving and improving the lives of pets. Our mission is to bring to our pets the same kinds of safe and effective medicines that our human family members enjoy. Our core strategy is to identify compounds and targets that have already demonstrated safety and efficacy in humans and to develop therapeutics based on these validated compounds and targets for pets, primarily dogs, cats and horses. We believe this approach will lead to shorter development times and higher approval rates than pursuing new, non-validated compounds and targets. We have three product candidates that are in, or will shortly enter, pivotal field efficacy trials, or pivotal trials, and expect approval of one or more of these product candidates in 2015. In addition, we have seven other product candidates, including several biologics, in various stages of development. We believe there are significant unmet medical needs for pets, and that the pet therapeutics segment of the animal health industry is likely to grow substantially as new therapeutics are identified, developed and marketed specifically for pets. Our lead product candidates are CereKin for the treatment of osteoarthritis pain and inflammation in dogs, AtoKin for the treatment of atopic dermatitis in dogs, and SentiKin for the treatment of post-operative pain in dogs. All of these product candidates, if approved, would be first-in-class drugs in the pet therapeutic market. In August 2013, we initiated the pivotal trial for CereKin. In February 2014, we initiated the pivotal trial for AtoKin, and we initiated the pivotal trial for SentiKin in March 2014. Assuming positive results from these trials, we intend to submit New Animal Drug Applications, or NADAs, for marketing approval of CereKin, AtoKin and SentiKin in the United States starting in 2014, and anticipate potential marketing approvals and product launches in the second half of 2015. If approved in the United States, we may make similar regulatory filings for these products with the European Medicines Agency, or EMA, for marketing approval in the European Union, or EU. We are currently developing product candidates for ten additional indications, with the potential to launch two or more products annually for several years starting in the second half of 2015. We plan to commercialize our products in the United States through a direct sales force complemented by selected distributor relationships, and in the EU through distributors and other third parties. Because we seek to identify product candidates that are not protected by third-party patents, we typically do not need to obtain licenses or make any upfront, milestone or royalty payments in connection with our product candidates. Relative to human drug development, the development of pet therapeutics is generally faster, more predictable and less expensive, since it requires fewer clinical studies involving fewer subjects and can be conducted directly in the target species. For example, studies that are typically required for approval of human drugs such as QTc studies, which detect cardiac irregularities, elderly patient studies, renal impairment studies, hepatic impairment studies or costly, long-term genotoxicity studies are not required for pet therapeutics. Based on our progress since inception in September 2012, we believe we can develop pet therapeutics from the Investigational New Animal Drug, or INAD, filing with the FDA to marketing approval in three to five years at a cost of approximately $3 million to $5 million per product candidate. The lower cost associated with the development of pet therapeutics permits us to pursue multiple product candidates simultaneously and avoid the binary outcome associated with some human biotechnology companies development of a single lead therapy. The active ingredients in many of our small molecule product candidates also have established chemistry, manufacturing and controls, or CMC, which can be important gating factors in the regulatory approval process. As a result, we usually do not need to invest further in active pharmaceutical ingredient, or API, process development to comply with good manufacturing practices, or GMP, standards for our small molecule product candidates. The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED MARCH 31 , 2014 PRELIMINARY PROSPECTUS $50,000,000 Kindred Biosciences, Inc. Common Stock We are offering shares of our common stock. Our common stock is listed on The NASDAQ Capital Market under the symbol KIN. On March 28, 2014, the last reported sale price of our common stock on The NASDAQ Capital Market was $18.91. Investing in our common stock involves a high degree of risk. See Risk Factors beginning on page 10. We are an emerging growth company as defined by the Jumpstart Our Business Startups Act of 2012 and, as such, we have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. Per Share Total Public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds, before expenses to us $ $ Table of Contents Product Pipeline Our current product pipeline consists of small molecules and biologics in various stages of development for a range of indications in dogs, cats and horses. Small molecules are generally chemical compounds administered orally and biologics are generally proteins and vaccines administered by injection. The USDA s Center for Veterinary Biologics and the FDA s Center for Veterinary Medicine have a memorandum of understanding under which animal products are to be regulated by the USDA as biologics, if they are intended for use to diagnose, cure, mitigate, treat, or prevent disease in animals and they work primarily through an immune process, or by the FDA as drugs, if they are intended for use in the diagnosis, cure, mitigation, treatment, or prevention of animal disease if the primary mechanism of action is not immunological or is undefined. Although we believe that most of our current animal biologics will be regulated by the USDA based on their mechanisms of action, it is possible that the agencies may determine that one or more of our animal biologics will be regulated by the FDA instead of the USDA. The following table illustrates ten product candidates that we are developing for 13 indications. References in the table to PLA mean Application for United States Veterinary Biological Product License with the USDA, also called a Product License Agreement. In addition to the products candidates in the above chart, we have several projects that are entering the pipeline, including immune checkpoint inhibitors and feline erythropoietin. We utilize a rigorous screening and review process to identify compounds and targets that have demonstrated safety and efficacy in humans and would address unmet medical needs in veterinary medicine if formulated for use in pets. (1) We refer you to Underwriting beginning on page 103 of this prospectus for additional information regarding underwriter compensation. We have granted the underwriters a 30-day option to purchase a total of up to additional shares of common stock. The underwriters expect to deliver shares of common stock to purchasers on , 2014. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Leerink Partners BMO Capital Markets Guggenheim Securities The date of this prospectus is , 2014. Table of Contents Pet Therapeutics Market U.S. consumers spent an estimated $55.5 billion on their pets in 2013, according to the American Pet Products Association, or APPA, an increase of 44% from 2006. The veterinary care segment has been among the fastest growing segments of the overall U.S. pet market. This segment accounted for an estimated $14.2 billion in 2013, an increase of 54% from 2006. In 2011, approximately $4.3 billion was spent on parasiticides and vaccines and approximately $2.4 billion was spent on pet therapeutics, our target segment. We believe several factors, including the increased longevity of pets and willingness of pet owners to treat their pets with medications, will contribute to continued growth in the spending on pet therapeutics. Despite the growing market for pet products, generally, there are relatively few therapeutic treatment options approved for use in pets as compared to humans. As a result, veterinarians often resort to prescribing products approved for use in humans but not approved, formulated or even formally studied in pets. Veterinarians must then rely upon trial and error or untested rules of thumb to assess the proper dosage needed for the human product to be effective in the particular species without undue risk of side effects. The veterinarian also must find a way to administer the human product in animals and determine the amount actually dosed, which are important considerations in treating pets with human drugs. We believe that therapeutics specifically developed for pets can extend and improve the quality of the lives of pets, help veterinarians achieve improved medical outcomes and make the process of administering therapeutics to pets much more convenient. Although there are many similarities between the businesses of developing and commercializing therapeutics for pets and for humans, there also are a number of important differences, including: Faster, less expensive and more predictable development. The development of pet therapeutics requires fewer clinical studies in fewer subject animals than human therapeutics and, unlike human drug development, can be conducted directly in the target animals. We believe our strategy of selecting compounds and targets with demonstrated efficacy and safety in humans enhances the predictability of results and probability of success of our pivotal trials relative to compounds and targets that have not been previously validated. Role and incentives for veterinary practices. In the United States, veterinarians generally serve the dual role of doctor and pharmacist, and pet owners typically purchase medicines directly from their veterinarians. Therapeutics specifically developed for pets enable veterinarians to provide potentially superior treatment options, while also increasing revenue from the sale of these therapeutics. Primarily private-pay nature of veterinary market. Pet owners in the United States generally pay for pet therapeutics out-of-pocket, and less than 5% of pet owners currently purchase pet insurance. As a result, pet owners must make decisions regarding available treatment options primarily on the advice of their veterinarians, rather than on the treatment options eligibility for reimbursement by insurance companies or government payers. We believe this results in less pricing pressure compared to human healthcare, although the limited adoption of insurance may also reduce pet owners ability to pay for therapeutics recommended by their veterinarians. Less generic competition and strong brand loyalty. There is less generic competition in the pet therapeutics industry than in the human therapeutics industry. Approximately 14% of veterinary drugs face generic competition, and the percentage of generic prescriptions in the veterinary space is only 7% as compared to approximately 81% for human drugs. We believe that stronger brand loyalty and lack of mandatory generic drug substitution, as is the case for human pharmaceuticals, partially explains the low penetration of generics in veterinary medicine. Lead Product Candidates CereKin CereKin is an oral, chewable, beef-flavored formulation of diacerein, an interleukin-1 beta inhibitor that we are developing for osteoarthritis pain and inflammation in dogs. Human drugs containing the active ingredient in CereKin are marketed extensively outside the United States for the treatment of osteoarthritis and are generally considered to be safe, except for certain gastrointestinal side effects and rare indiosyncratic skin and liver side effects in humans, for which the drug is undergoing review in the EU. These side effects appear to be less frequent or absent in dogs. Several published studies have shown that the active ingredient is effective in treating canine arthritis. We initiated the pivotal trial for CereKin in August 2013 under a Protocol Concurrence with the FDA. A Protocol Concurrence in animal drug development is analogous to a Special Table of Contents Protocol Assessment in human drug development, and means that the FDA agrees that the design and analyses proposed in a protocol are acceptable to support regulatory approval of the product candidate with respect to effectiveness of the indication studied and will not change its view of these matters, unless public or animal health concerns arise that were not recognized at the time of Protocol Concurrence or we change the protocol. We expect to have data from the pivotal trial in the second quarter of 2014 and, if positive, intend to submit NADA starting in mid-2014, with potential marketing approval in the second half of 2015. If approved, CereKin would be a first-in-class drug for the veterinary market. Canine osteoarthritis is a chronic, progressive, degenerative joint disease, diagnosed in an estimated 20% of dogs over the age of one. Non-steroidal anti-inflammatory drugs, or NSAIDs, are the only approved treatment for canine osteoarthritis (other than steroids and a vitamin-mineral based drug), but some dogs have a sensitivity to NSAIDs that results in renal, hepatic or gastrointestinal, or GI, toxicity and, in extreme cases, death. As a result, dogs that are prescribed NSAIDs must often be monitored with baseline and periodic blood tests, and up to approximately 50% of dogs remain untreated or cannot be treated in chronic cases. If approved, we believe CereKin will be effective in the treatment of canine osteoarthritis pain and inflammation, without the need for blood monitoring tests. In humans, the active ingredient in CereKin has demonstrated added effectiveness when combined with NSAIDs versus NSAIDs alone. Based on published data, we expect CereKin may have disease-modifying effects in dogs and also may protect against NSAID-induced GI tract problems. AtoKin AtoKin is a high-dose, oral, chewable, beef-flavored formulation of fexofenadine that we are developing for atopic dermatitis in dogs. The active ingredient in AtoKin is a potent and selective antihistamine that is approved for allergic diseases in humans. Published data indicate that the active ingredient is as effective as steroids in treating canine atopic dermatitis. We have been granted a Protocol Concurrence by the FDA for the pivotal trial of AtoKin, which we initiated in February 2014. We expect to receive data from the trial in late 2014 and, if positive, we intend to submit a NADA in late 2014, with potential marketing approval in late 2015. Atopic dermatitis is a common, potentially chronic, allergic skin disease that affects up to 10% of all dogs. Dogs with atopic dermatitis often suffer from pruritus, or severe itching, hair loss, tearing of the skin from deep scratching, frequent licking of their paws and excessive tear production. While currently approved drugs such as corticosteroids and oral cyclosporine are effective, they all suppress the dog s immune system, potentially leading to serious infections. Corticosteroids also have other side effects, including osteoporosis, endocrine problems, cataracts and frequent urination. We believe that, if approved, AtoKin could be effective as both a first-line therapy and as a long-term maintenance therapy for chronic atopic dermatitis in dogs, with a safety profile superior to currently approved therapeutics. SentiKin SentiKin is an oral, non-NSAID, non-opioid analgesic, formulation of flupirtine that we are developing for management of post-operative pain in dogs, cats and horses. The active ingredient in SentiKin is approved for the treatment of pain in humans in multiple countries outside the United States and has demonstrated potency comparable to tramadol. Published studies suggest that the active ingredient is effective in treating canine pain. We initiated the pivotal study for SentiKin in March 2014. We have discussed the design of the pivotal study with the FDA, and based on those discussions, we have submitted the protocol for a Protocol Concurrence which we expect to receive in mid-April. We expect to receive data from the trial in late 2014 and, if positive, we intend to submit a NADA in late 2014, with potential marketing approval in late 2015. There is no standard of care for the use of pain medications following dog surgeries, and the only systemic drugs approved for treatment of post-operative pain in dogs are NSAIDs, fentanyl and pentazocine. NSAIDs are generally less effective than opioids in controlling pain and have other well-documented side effects described above in our discussion regarding CereKin. Fentanyl is a controlled narcotic drug, and pets are often kept in the hospital while receiving fentanyl. Pentazocine is a controlled narcotic drug, not widely used in dogs. We believe that, if approved, SentiKin may provide post-operative pain relief that is superior to NSAIDs and comparable to some opioids, without the potential for opioid addiction or the risk of possible diversion and abuse by pet owners. TABLE OF CONTENTS Page Prospectus Summary 1
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+Prospectus Summary This Prospectus, and any supplement to this Prospectus include "forward-looking statements". To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as "intends", "anticipates", "believes", "estimates", "projects", "forecasts", "expects", "plans" and "proposes". Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the "Risk Factors" section beginning on page 8 of this Prospectus and the "Management's Discussion and Analysis of Financial Position and Results of Operations" section elsewhere in this Prospectus. Our Business We were incorporated on January 02, 2013 under the laws of the State of Nevada. Our principal executive offices are located at Level 8, Two Exchange Square, 8 Connaught Place, Central, Hong Kong and one office located at 200 S. Virginia Street, 8th Floor, Reno, NV 89501 USA. Our telephone # is 775-636-6988. Our fiscal year end is February 28. We are a development stage company and we plan to be in the business of marketing, distributing and selling pharmaceutical medicines in international tenders managed by World Health Organization-Geneva (WHO). Until recently, we did not yet own the rights to market, distribute or sell any pharmaceutical medicines. On July 3, 2013, however, we entered into a license agreement (the "Agreement"), which was amended on July 30, 2013 and again on October 15, 2013, with Luckycom Pharma Pte. Ltd. based out of Singapore and acquired the exclusive and worldwide rights to manufacture, have manufactured, distribute, sell, market and promote the antimalarial medicine Cosunate (artesunate-amodiaquine kit tablets). We paid Luckycom Pharma 500,000 shares of our common stock valued at $0.11 per share for the two year license. Under the Agreement, we also acquired an option to purchase Cosunate intellectual property from Luckycom Pharma for 9,000,000 shares of our common stock. Luckycom Pharma is owned by our officer and director, Kingrich Lee, and, as such, the Agreement is considered a related party transaction. The shares paid under the Agreement belong to Mr. Kingrich through his company Luckycom Pharma. Moreover, the value set at $0.11 per share was arbitrarily chosen, was not the result of an arm s length valuation process and does not reflect our book value or any other objective criteria of value. In the next twelve months and beyond, we plan to qualify and gain acceptance in international public tenders, through the prequalification program process with the WHO. An international public tender, also called government procurement or public procurement, is the procurement of goods and services on behalf of a public authority, such as a government agency. Later on in this Prospectus, we have detailed the preliminary steps we need to take and those involved in the actual application process with the WHO. We have no assurance that we will meet the requirements necessary to be accepted under the prequalification program. We expect to be preparing for and in the application process for at least two to three years, and maybe longer. If we are able to gain acceptance and prequalify with the WHO, our long term plan is to seek out public opportunities in this venue and participate in bulk supplying of medicines. Our license with Luckcom Pharma is only for two years. If the application process with the WHO exceeds two years and, assuming we have financing available to make it that far in the process, we will have to renegotiate our two year license agreement with Luckycom Pharma or exercise our option to purchase the Cosunate intellectual property from Luckycom Pharma outright. As of February 28, 2014, we had $94,320 in current assets, consisting of cash, and current liabilities in the amount of $202,159 Accordingly, we had a working capital deficit of $107,839 as of February 28, 2014. We have $57,881 in cash as of June 10, 2014 . Even so, our current working capital is not sufficient to enable us to implement our business plan as set forth in this prospectus. For these and other reasons, our independent auditors have raised substantial doubt about our ability to continue as a going concern. As we have not yet begun operations, we anticipate that we will meet our ongoing cash requirements through equity or debt financing. We estimate that our expenses over the next 12 months will be approximately $308,500. This estimate may change significantly depending on the nature of our future business activities and our ability to raise capital from shareholders or other sources. Table of Contents We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financing by way of private placements. We decided to become a reporting company to be better equipped to raise capital by providing the transparency to the public of our operations and development. We currently do not have any arrangements in place to complete any private placement financings and there is no assurance that we will be successful in completing any such financings on terms that will be acceptable to us. If we are not able to raise the full $308,500 to implement our business plan as anticipated, we will scale our business development in line with available capital. Our primary priority will be to retain our reporting status with the SEC which means that we will first ensure that we have sufficient capital to cover our legal and accounting expenses, which are estimated at $38,500 in the next twelve months. Once these costs are accounted for, in accordance with how much financing we are able to secure, we will focus on the following activities: 1. establishing an agreement with a regulatory affairs consultant firm; 2. establishing a supply agreement with an Active Pharmaceutical Ingredient (API) manufacturer for Artesuante and Amodiaquine supplies with WHO prequalification; 3. establishing a manufacturing agreement with a manufacturer with MHRA(UK) compliant facilities. MHRA (UK) stands for Medicines and Healthcare products Regulatory Agency. The MHRA is responsible for regulating all medicines and medical devices in the UK by ensuring they work and are acceptably safe. Its standards are acceptable to the WHO; and 4. working on the application process with WHO under its the prequalification program. We believe that we will need $308,500 to meet our business objectives in the next twelve months. A more detailed review of our business plan is set forth in the sections titled "Description of Business," and "Management s Discussion and Analysis of Financial Position and Results of Operations." Shell Company Status We are considered as a shell company as defined by Rule 12b-2 of the Exchange Act. Rule 12b-2 of the Exchange Act defines a "shell company" as a registrant that has "nominal operations" and "assets consisting solely of cash and cash equivalents and nominal other assets." Our shell company status prevents investor to resell our shares under Rule 144(i) unless and until 12 months after we are no longer considered a shell company. We caution investors as to the highly illiquid nature of an investment in our shares. The Offering The 400,000 shares of our common stock being registered by this Prospectus represent 4% of our issued and outstanding common stock as of June 10 , 2014. Securities Offered: 400,000 shares of common stock offered by 33 selling security holders (represent 100% of our outstanding shares held by non-affiliates) Initial Offering Price: The $0.11 per share initial offering price of our common stock was determined by our Board of Directors based on several factors, including our capital structure and the most recent selling price of the 400,000 shares of our common stock offered in this prospectus. We sold such 400,000 shares of common stock in private placements for $0.10 per share during the period from January 2, 2013 (inception) to January 31, 2013. The selling security holders will sell at a fixed price of $0.11 per share for the duration of the offering. There can be no assurance that our common stock will ever become quoted on the OTCBB. Securities Issued and to be Issued: As of June 10 , 2014 we had 10,500,000 issued and outstanding shares of our common stock, and no issued and outstanding convertible securities. All of the common stock to be sold under this Prospectus will be sold by existing stockholders. There is no established market for the common stock being registered. We intend to engage a market maker to apply to have our common stock quoted on the OTCBB. This process usually takes at least 60 days and the application must be made on our behalf by a market maker. We have not yet engaged a market maker to file our application. The trading of securities on the OTCBB is often sporadic and investors may have difficulty buying and selling or obtaining market quotations, which may have a depressive effect on the market price for our common stock. Proceeds: We will not receive any proceeds from the sale of our common stock by the selling security holders. Table of Contents Financial Summary Information All references to currency in this Prospectus are to US Dollars, unless otherwise noted. The following table sets forth selected financial information, which should be read in conjunction with the information set forth in the "Management s Discussion and Analysis of Financial Position and Results of Operations" section and the accompanying financial statements and related notes included elsewhere in this Prospectus. Balance Sheet Data As of February 28, 2013 As of February 28, 2014 Cash $0 $94,320 Total Assets $0 $130,987 Liabilities $0 $202,159 Total Stockholders Equity (Deficit) $(37,569) $(71,172) Period from January 2, 2013 (Inception) to February 28, 2013 For the Year Ended February 28, 2014 Period from January 2, 2013 (Inception) to February 28, 2014 Revenue $0 $0 $0 Net Income (Loss) for the Period $(37,579) $(224,603) $(262,182) Table of Contents
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+PROSPECTUS SUMMARY Prospective investors are urged to read this prospectus in its entirety. This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in the common stock. You should carefully read the entire prospectus, including "Risk Factors", "Management s Discussion and Analysis of Financial Condition and Results of Operations" and the Financial Statements, before making an investment decision. The terms "Scription Work Solutions Inc" f/k/a "Transtech Solutions Inc" "we," "us" and "our" as used in this prospectus refer to Scription Work Solutions Inc. Company Overview Scription Work Solutions Inc, f/k/a Transtech Solutions, Inc. (the "Company") was incorporated in the State of Nevada on July 12, 2011. We are a development stage company that plans to engage in the sale of medical transcription services. We intend to purchase a web-based platform that will give us the ability to reach potential customers. ChristopherWeinhaupl, who is currently our sole officer and director, founded our Company. Our headquarters are located at 843 N Rainbow Blvd, Unit 1175, Las Vegas, NV 89107. Medical transcription is converting confidential patient information from various sources such as voice recordings or medical notes into electronic text documents by medical transcriptionists. Scription Work Solutions intends to purchase one of many transcription platforms available on the market such as Dragon Medical Software or eScription, which our medical transcriptionists will use for physicians in hospitals, clinics and diagnostic laboratories in the United States. Since inception, our operations have primarily consisted of the formation of our company, completion of our business plan, and the acquisition of funding. We have not commenced in purchasing transcription software as we have not yet raised the minimum funds necessary to commence operations. A market-ready transcription platform will not be available for 10-12 months after we have raised the necessary funds. We will need to raise a minimum of $200,000 over the next twelve months through public or private debt or sale of equity to execute our business plan to become a revenue generating company. If we are unable to obtain the level of financing, our business may fail. We are endeavoring to be a reporting company with the SEC as we believe doing so will provide us with greater opportunities to access and acquire the additional capital that we require for our growth and to further implement our business plan. In addition, becoming a reporting issuer may provide us with more financing alternatives, due to the transparency provided by the public reporting requirements. Since inception, our operations have consisted of incorporating our Company and formulating our business plan. The Company intends to begin substantive operations within 10-12 months after we obtain our necessary funding requirements. The initial plan of operations calls for the Company to begin marketing our transcription services to potential business clients. We believe that if we are able to raise the full amount of funds contemplated herein, we would be able to launch our Company and properly market our transcription services . We will design a full marketing strategy to gain brand awareness, and ultimately obtain a large medical transcription client base. Table of Contents Although our sole officer and director has only recently become interested in the medical transcription business, and does not have any professional training or technical credentials in the development and maintenance of such a company, he has experience running a business. We plan to purchase a medical transcription platform and hire qualified marketing and sales personnel staff if we are successful in raising capital. We do not have any verbal or written agreements regarding the retention of any qualified personnel to date. Although the Company has no market for its common stock, management believes that the Company will meet all requirements to be quoted on the OTC market, and even though the Company s common stock will likely will be a penny stock, becoming a reporting company will provide us with enhanced visibility and give us a greater possibility to provide liquidity to our shareholders. We are currently a development stage company and to date we have recorded no revenue. Accordingly, our independent registered public accountants have issued a comment regarding our ability to continue as a going concern (please refer to the footnotes to the financial statements). Until such time that we are able to establish a consistent flow of revenues from our operations which is sufficient to sustain our operating needs, management intends to rely primarily upon debt financing to supplement cash flows, if any, generated by our services. We will seek out such financing as necessary to allow the Company to continue to grow our business operations, and to cover such cost, including professional fees, associated with being a reporting Company with the Securities and Exchange Commission ("SEC"); we estimate such costs to be approximately $200,000 for 12 months following this Offering. The Company has included such costs to become a publicly reporting company in its targeted expenses for working capital expenses and intends to seek out reasonable loans from friends, family and business acquaintances if it becomes necessary. At this point we have been funded by our sole officer, family, friends and business acquaintances. Table of Contents We are an Emerging Growth Company as defined in the Jumpstart Our Business Startups Act. We shall continue to be deemed an emerging growth company until the earliest of: (A) the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; (B) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title; (C) the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or (D) the date on which such issuer is deemed to be a , ' ': large accelerated filer , as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto. As an emerging growth company we are exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company we are exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. Because our auditors have issued a going concern opinion, there is substantial uncertainty we will continue operations in which case you could lose your investment. Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months as we lack an operating history. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment. We currently have no commitments to raise the minimum funds necessary to become a revenue generating company over the next twelve months. As of effectiveness of our registration statement of which this prospectus is a part, the Company will not become a fully reporting company, but rather, will be subject to the reporting requirements of Section 15(d) of the Securities Exchange Act of 1934. We will be required to file periodic reports with the SEC which will be immediately available to the public for inspection and copying. Except during the year that our registration statement becomes effective, these reporting obligations may be automatically suspended under Section 15(d) if we have less than 300 shareholders. If this occurs after the year in which our registration statement becomes effective, we will no longer be obligated to file periodic reports with the SEC and your access to our business information would then be even more restricted; however, that filing obligation will generally apply even if our reporting obligations have been suspended automatically under section 15(d) of the Exchange Act prior to the due date for the Form 10-K. After that fiscal year and provided the Company has less than 300 shareholders, the Company is not required to file these reports. If the reports are not filed, the investors will have reduced visibility as to the Company and its financial condition. In addition, as a filer subject to Section 15(d) of the Exchange Act, the Company is not required to prepare proxy or information statements, and our common stock will not be subject to the protection of the ongoing private regulations. Additionally, the Company will be subject to only limited portions of the tender offer rules, and our officers, directors, and more than ten (10%) percent shareholders are not required to file beneficial ownership reports about their holdings in our Company, and will not be subject to the short-swing profit recovery provisions of the Exchange Act. Further, more than five percent (5%) holders of classes of our equity securities will not be required to report information about their ownership positions in the securities. This means that your access to information regarding our business will be limited. As a reporting company under the Exchange Act, we are required to comply with the internal control evaluation and certification requirements of Section 404 of the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act requires annual management assessments of the effectiveness of our internal control over financial reporting, starting with the second annual report that we file with the SEC after the consummation of this Offering. In connection with the implementation of the necessary procedures and practices related to internal control over financial reporting, we may identify deficiencies that we may not be able to remediate in time to meet the deadline imposed by the Sarbanes-Oxley Act for compliance with the requirements of Section 404. We will be unable to issue securities in the public markets through the use of a shelf registration statement if we are not in compliance with Section 404. Furthermore, failure to achieve and maintain an effective internal control environment could have a material adverse effect on our business and share price and could limit our ability to report our financial results accurately and timely Table of Contents SUMMARY OF THIS OFFERING The Issuer Scription Work Solutions Inc, f/k/a Transtech Solutions Inc. Securities being offered Up to 20,000,000 shares of Common Stock Offering Type The selling shareholders will sell our shares at a fixed price of $0.01 per share. Per Share Price The selling stockholders may offer their shares through public or private transactions at a fixed price of $0.01 per share. We will pay all expenses of registering the securities, estimated at approximately $20,000 .
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001568832_rcs_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001568832_rcs_prospectus_summary.txt
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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+elsewhere in this prospectus and is qualified in its entirety by the more detailed information and consolidated financial statements included elsewhere in this prospectus. This summary does not contain all of the information that may be important to you. You should read and carefully consider the following summary together with the entire prospectus, including our consolidated financial statements and the notes thereto appearing elsewhere in this prospectus and the matters discussed in the sections in this prospectus entitled Risk Factors, Selected Consolidated Financial Data and Management s Discussion and Analysis of Financial Condition and Results of Operations before deciding to invest in our common stock. Some of the statements in this prospectus constitute forward-looking statements that involve risks and uncertainties. See Special Note Regarding Forward-Looking Statements and Industry Data. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those discussed in the Risk Factors and other sections of this prospectus. Except as otherwise indicated herein or as the context otherwise requires, references in this prospectus to Epizyme, the company, we, us and our refer to Epizyme, Inc., together with its consolidated subsidiary. Company Overview We are a clinical stage biopharmaceutical company that discovers, develops and plans to commercialize innovative personalized therapeutics for patients with genetically defined cancers. We systematically identify the genetic alterations that create cancer causing genes, called oncogenes, select patients in whom the identified genetic alteration is found and then design small molecule therapeutics to inhibit the oncogene. The clinical development plan for each of our product candidates is directed towards patients with a particular genetically defined cancer. Our approach is part of a broader trend towards personalized therapeutics based on first identifying the underlying cause of a disease afflicting specific patient populations, applying rational drug design tools to create a therapeutic to bind with a molecular target in the identified disease pathway and using a companion diagnostic to select the right patients for treatment. We have built a proprietary product platform that we use to create small molecule inhibitors of a class of enzymes known as histone methyltransferases, or HMTs. HMTs are part of the system of gene regulation, referred to as epigenetics, that controls gene expression. In 2011, our scientists defined the 96-member HMT target class, which is referred to as the HMTome. Genetic alterations can result in changes to the activity of HMTs, making them oncogenic. When Epizyme was founded, we recognized that the HMT target class might contain many potential oncogenes and, therefore, presented the opportunity to create, develop and commercialize multiple personalized therapeutics. We currently have two HMT inhibitors in clinical development for the treatment of patients with genetically defined cancers and believe we are the first company to conduct a clinical trial of an HMT inhibitor. We are conducting a Phase 1 clinical trial of our most advanced product candidate, EPZ-5676, an inhibitor targeting the DOT1L HMT, being developed for the treatment of acute leukemias with genetic alterations of the MLL gene, referred to as MLL-r and MLL-PTD. On January 6, 2014, we announced that we had earned a $25.0 million proof-of-concept milestone in our collaboration with Celgene Corporation and Celgene International S rl, collectively referred to as Celgene, in December 2013 by achieving objective responses in two MLL-r patients enrolled in the dose escalation stage of our Phase 1 trial. We are also conducting a Phase 1/2 clinical trial of our second most advanced product candidate, EPZ-6438, an inhibitor targeting the EZH2 HMT, being developed for the treatment of a genetically defined subtype of non-Hodgkin lymphoma and solid tumors including INI1-deficient tumors, such as synovial sarcoma and malignant rhabdoid tumors, or MRT. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities, and it is not soliciting offers to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 3, 2014 PRELIMINARY PROSPECTUS 4,192,679 Shares Epizyme, Inc. Common Stock We are offering 3,000,000 shares of our common stock and the selling stockholders are offering 1,192,679 shares of our common stock. We will not receive any proceeds from the sale of shares by the selling stockholders. To the extent that the underwriters sell more than 4,192,679 shares of common stock, the underwriters have an option to purchase up to 628,901 additional shares from us at the public offering price, after deducting underwriting discounts and commissions. Our common stock is listed on The NASDAQ Global Market under the symbol EPZM. The last reported sale price of our common stock on The NASDAQ Global Market on January 31, 2014 was $30.40 per share. Investing in our common stock involves risks. See Risk Factors beginning on page 12. We are an emerging growth company under applicable Securities and Exchange Commission rules and are eligible for reduced public company disclosure requirements. See Summary Implications of Being an Emerging Growth Company. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Share Total Public Offering Price $ $ Underwriting Discount(1) $ $ Proceeds to Epizyme (before expenses) $ $ Proceeds to selling stockholders $ $ (1) The underwriting discount for the shares of common stock sold by Epizyme is $ per share and the underwriting discount for the shares of common stock sold by the selling stockholders is $ per share. We refer you to Underwriting beginning on page 149 for additional information regarding underwriting compensation. Celgene European Investment Company LLC, or CEIC, which is affiliated with one of our collaborators and is an existing investor, has indicated an interest in purchasing up to that number of shares of our common stock in this offering at the public offering price such that CEIC s percentage ownership of our common stock following the offering would be the same as, or less than, its current percentage ownership. Assuming a public offering price of $30.40 per share, the last sale price of our common stock on January 31, 2014, CEIC would purchase an aggregate of up to approximately 347,100 of the 4.2 million shares offered in this offering for an aggregate purchase price of approximately $10.6 million, based on this indication of interest. However, because indications of interest are not binding agreements or commitments to purchase, CEIC may determine to purchase fewer shares than it has indicated an interest in purchasing or not to purchase any shares in this offering. In addition, the underwriters could determine to sell fewer shares to CEIC than it indicates an interest in purchasing or not to sell any shares to CEIC. The underwriters will receive the same underwriting discount on any shares purchased by CEIC as they will on any other shares sold to the public in this offering. The underwriters expect to deliver the shares to purchasers on or about , 2014 through the book-entry facilities of The Depository Trust Company. Citigroup Cowen and Company Leerink Partners JMP Securities Wedbush PacGrow Life Sciences BTIG , 2014 Table of Contents In 2014, we plan to have four clinical trials ongoing that are intended to assess the proof of concept of our product candidates in five genetically defined cancer patient groups: The expansion stage of our ongoing Phase 1 clinical trial of EPZ-5676 in MLL-r adult patients and MLL-PTD adult patients; Our planned Phase 1b clinical trial of EPZ-5676 in MLL-r pediatric patients; Our planned Phase 2 clinical trial of EPZ-6438 in non-Hodgkin lymphoma patients with EZH2 point mutations as part of our ongoing Phase 1/2 clinical trial of EPZ-6438; and Our planned Phase 2 clinical trial of EPZ-6438 in synovial sarcoma patients. The initiation of our proof-of-concept trials of EPZ-6438 is subject to our review of the data from the Phase 1 clinical trial of EPZ-6438 that we are conducting as part of our ongoing Phase 1/2 clinical trial of EPZ-6438. In addition to our clinical programs, we also have a pipeline of HMT inhibitors in preclinical development that target our other prioritized HMTs in the HMTome. These programs are directed to genetically defined cancers, both hematological and solid tumors. As we announced on January 6, 2014, one of these preclinical HMT inhibitors achieved a development candidate milestone in December 2013, earning a $4.0 million milestone in our collaboration with Glaxo Group Limited (an affiliate of GlaxoSmithKline), or GSK. For many of our therapeutic product candidates, we plan to develop a companion diagnostic for the identification of patients with the genetically defined cancers that we seek to treat with our therapeutic product candidates. Because we are tailoring our personalized therapeutics for discrete patient populations with genetically defined cancers, we believe that many of our products may qualify for orphan drug designation in the United States, the European Union and other regions. We believe our personalized therapeutic product candidates offer the promise of treatment for patients with genetically defined cancers by blocking the incorrect function of oncogenic HMTs. We were founded in November 2007 and are led by a management team with extensive experience in the pharmaceutical industry. We have entered into therapeutic collaborations with Celgene, Eisai Co., Ltd., or Eisai, and GSK, that have provided us with $133.3 million in non-equity funding through September 30, 2013. As of September 30, 2013, we had $139.6 million in cash and cash equivalents. We estimate that our cash, cash equivalents and accounts receivable balance as of December 31, 2013 will be between $155.0 million and $160.0 million. We have provided a range, rather than a specific amount, for our estimate of cash, cash equivalents and accounts receivable primarily because we have not yet completed our year-end closing procedures for the year ended December 31, 2013. It is possible that our cash, cash equivalents and accounts receivable balance will not be in this range. We will not complete our year-end closing procedures until after this offering is complete. Our independent registered accounting firm, Ernst & Young LLP, has not audited or reviewed, and does not express an opinion with respect to, this estimate. Role of Epigenetics and HMTs Epigenetics is a regulatory system that controls gene expression. When properly read and translated, genes provide the blueprint for making the individual proteins of the body. Epigenetic control of gene expression relies on the precisely orchestrated activity of a collection of enzymes. When the function of these epigenetic enzymes is altered, gene expression is changed in ways that often leads to disease. HMTs are a type of epigenetic enzyme that regulate gene expression by adding marks, called methyl groups, to specific locations on chromosomes, a process known as methylation. Oncogenic HMTs inappropriately mark these locations, driving multiple types of cancer, including hematological cancers and solid tumors. Out of the 96 enzymes in the HMTome, we have prioritized 20 HMTs as attractive targets for personalized therapeutics based on their oncogenic potential. Table of Contents Our Strategy Our goal is to be a leader in the discovery, development and commercialization of personalized therapeutics for the treatment of patients with genetically defined cancers. We believe that many of our products may qualify for orphan drug designation in the United States, the European Union and other regions. Key elements of our strategy to achieve our goal are to: Rapidly advance the clinical development of our two lead product candidates. We have designed the Phase 1 clinical trial of EPZ-5676 and the Phase 1/2 clinical trial of EPZ-6438 to include some patients with the genetically defined cancer that we are seeking to treat. If we see evidence of a therapeutic effect in either of these trials, we plan to meet with regulatory authorities to discuss the possibility of an expedited clinical development and regulatory pathway for the applicable program. This approach is similar to the clinical development pathway that was used by the sponsor of the cancer therapeutic Zelboraf which was included by the FDA in its 2011 report on Innovative Drug Approvals and which received marketing approval from the FDA within five years of initiating Phase 1 clinical trials. If safe and sufficiently active in the genetically defined population, we believe that our two lead product candidates may be able to rely on an expedited regulatory approval process because these product candidates have the potential to satisfy the requirements that applied to these other cancer therapeutics as well as the FDA s new breakthrough therapy designation, such as treating a life-threatening disease and providing a major advance in treatment. We cannot predict whether or when any of our product candidates will prove effective or safe in humans, if they will receive regulatory approval or if we will be able to participate in FDA expedited review and approval programs, including breakthrough and fast track designation. Pursue expansion indications for our two lead product candidates. We apply our proprietary product platform to identify additional genetically defined cancers that may be treated with each of our product candidates beyond the initial indication of interest. MLL-PTD is an expansion indication for the EPZ-5676 product candidate that we identified internally. Similarly, we identified INI1-deficient tumors as potential expansion indications for EPZ-6438. Leverage our existing collaborations. We have established therapeutic collaborations with Celgene, Eisai and GSK for our most advanced HMT programs. We believe that our collaborations contribute to our ability to rapidly advance our product candidates, build our product platform and concurrently progress a wide range of discovery and development programs. In the case of the Celgene and Eisai arrangements, we have retained commercialization or co-commercialization rights in the United States. Establish commercialization and marketing capabilities in the United States. We have retained commercialization or co-commercialization rights in the United States for all of our programs other than the three programs in our GSK collaboration. We intend to build a focused specialty sales force and marketing capabilities in the United States to commercialize any of our oncology drugs that receive regulatory approval. Use our product platform to build a pipeline of proprietary HMT inhibitors. We are using our intellectual property, expertise and knowledge to create small molecule inhibitors of the 20 HMT targets that we have prioritized. We have invented novel, potent small molecule inhibitors of 15 of these 20 prioritized HMTs. We intend to advance multiple other product candidates into clinical trials. Develop companion diagnostics for use with our therapeutic product candidates. For many of our therapeutic product candidates, we plan to develop a companion diagnostic for the identification of patients with the genetically defined cancers that we seek to treat with our therapeutic product candidates. We intend to develop diagnostics based on currently available diagnostic technologies to the extent possible in order to minimize development and regulatory risk of our diagnostic programs. Table of Contents Our Lead Product Candidates We invented our two lead product candidates using our proprietary product platform. We designed these product candidates to treat genetically defined cancers for which there is a significant unmet medical need. EPZ-5676 DOT1L Inhibitor We are developing EPZ-5676 as an intravenously administered small molecule inhibitor of DOT1L for the treatment of acute leukemias with alterations in the MLL gene, specifically rearrangements of MLL as a consequence of chromosomal translocation, or MLL-r, and partial tandem duplications of the MLL gene, or MLL-PTD. We initiated a Phase 1 clinical trial of this product candidate in September 2012. Our Phase 1 clinical trial of EPZ-5676 is an open label, multicenter trial that has two stages. The first stage is a dose escalation stage that includes some MLL-r patients. The second stage is an expansion stage that will only include MLL-r and MLL-PTD patients. We also plan to initiate a Phase 1b trial of EPZ-5676 in pediatric patients with MLL-r in 2014. The primary objectives of the ongoing Phase 1 trial are to evaluate the safety and tolerability of EPZ-5676 and to determine its maximum tolerated dose. Secondary objectives of this trial are to: determine the process by which EPZ-5676 is distributed and metabolized in the body, which is referred to as pharmacokinetics; assess the biochemical and physiological effects of EPZ-5676 on the human body, which is referred to as pharmacodynamics, including methylation in peripheral blood mononuclear cells and leukemia cells; and evaluate any early evidence of anti-tumor activity in patients with MLL-r. The dose escalation stage of this trial was fully enrolled as of December 31, 2013. A total of five dose cohorts were enrolled at doses of 12, 24, 36, 54, and 80 mg/m2/day, with a total of 19 patients enrolled. The dose escalation stage allowed for but did not require the enrollment of patients with the targeted MLL genetic alterations, MLL-r and MLL-PTD. The majority of patients had a diagnosis of acute myeloid leukemia, or AML. Other diagnoses included acute lymphoblastic leukemia, or ALL, and chronic myelomonocytic leukemia, or CMML. Based on the trial results to date, EPZ-5676 has demonstrated a favorable safety and tolerability profile. Specifically, no dose-limiting toxicities, drug-related trial discontinuations, or serious adverse events considered by the clinical site investigators to be related to EPZ-5676 have been reported. In December 2013, two patients in the fourth dose cohort of the ongoing Phase 1 trial had objective responses. These patients had demonstrated treatment-related effects and were switched from the original intravenous administration schedule, which provided for cycles of 21 days of continuous intravenous administration followed by seven days with no treatment, to an uninterrupted intravenous administration schedule. One of these patients was diagnosed with AML with an MLL-r translocation. The other patient was diagnosed with CMML with an MLL-r translocation. In addition to the two objective responses, we observed treatment effects of EPZ-5676 in some other patients with MLL-r in the trial, such as treatment-related leukocytosis, cellular maturation in blood and bone marrow and resolution of leukemia-related symptoms such as cachexia, fevers, and leukemia cutis that are consistent with anti-leukemic effects in MLL-r patients. Consistent with the genetically defined therapeutic mechanism of action of EPZ-5676, no treatment effects were seen in the non-MLL-r patients. We have not reported results for the fifth dose cohort, which is still ongoing. Based on the initial findings from the dose escalation stage of the ongoing Phase 1 trial, we began enrolling the MLL-r/MLL-PTD expansion stage in December 2013. This stage of the trial will only enroll MLL-r and MLL-PTD patients and is designed to provide an initial assessment of efficacy, or proof of concept, in these two distinct patient populations. We plan to enroll in the trial 15 to 20 MLL-r patients and 15 to 20 MLL-PTD patients. These patients will receive EPZ-5676 with uninterrupted intravenous administration. This trial has a starting dose at 90 mg/m2/day and allows for dose escalation. We plan to provide data from the Phase 1 clinical trial, including from the dose escalation stage and the MLL-r/MLL-PTD expansion stage, in 2014. Table of Contents We retain all U.S. rights to EPZ-5676. We have granted Celgene an exclusive license to EPZ-5676 outside of the United States. We are working with Abbott Molecular Inc., or Abbott, to develop a companion diagnostic to identify patients with the MLL-r genetic alteration for this program. We may seek to collaborate with an established diagnostic company to develop a companion diagnostic to identify patients with the MLL-PTD genetic alteration for this program. EPZ-6438 EZH2 Inhibitor We are developing EPZ-6438 as an orally available small molecule inhibitor of EZH2 for the treatment of non-Hodgkin lymphoma patients who have an oncogenic point mutation in EZH2 and for the treatment of certain INI1-deficient solid tumors, such as synovial sarcoma, a soft tissue sarcoma, and malignant rhabdoid tumor, a pediatric cancer. In June 2013, Eisai and we initiated a Phase 1/2 clinical trial of EPZ-6438. The Phase 1/2 clinical trial of EPZ-6438 is being conducted in two parts. The Phase 1 clinical trial is an open label dose escalation trial that includes some patients with an EZH2 point mutation. This trial is currently enrolling patients with advanced solid tumors or with relapsed or refractory B cell lymphoma at clinical sites in France. The primary objective of the Phase 1 clinical trial is to evaluate the safety and tolerability of EPZ-6438 and to determine its maximum tolerated dose when administered as a single agent twice daily in 28-day cycles. Secondary objectives of the Phase 1 clinical trial are to: determine the oral bioavailability, meaning the fraction of an orally administered drug that reaches systemic circulation, of EPZ-6438; determine the potential for drug/drug interactions with EPZ-6438; preliminarily assess activity of EPZ-6438; and evaluate any early evidence of anti-tumor activity in patients with an EZH2 point mutation. Subject to enrolling patients on our planned schedule, we expect to announce top-line results from the Phase 1 clinical trial in 2014. The current design for the Phase 2 clinical trial is focused on the evaluation of EPZ-6438 for the treatment of non-Hodgkin lymphoma patients with a point mutation in EZH2. The Phase 2 clinical trial will consist exclusively of patients with an EZH2 point mutation. The primary objective of the Phase 2 clinical trial will be to assess the objective response rate of EPZ-6438 in patients who have confirmed relapsed or refractory diffuse large B-cell lymphoma of germinal-center origin, or DLBCL, or follicular lymphoma, or FL, and an EZH2 point mutation. The secondary objective of the Phase 2 clinical trial will be to assess progression-free survival, disease control rate and the clinical benefit rate of EPZ-6438 as a single agent. The Phase 2 clinical trial will be conducted in two stages. In the first stage, all patients will be dosed at the maximum tolerated dose as determined in the Phase 1 clinical trial. Depending upon the number of responses observed in the first stage of the Phase 2 part of this clinical trial, we may initiate a second stage in which patients will be randomized in a 2:1 manner to receive either EPZ-6438 or the existing standard of care treatment. Pending our review of the data from the ongoing Phase 1 trial, we expect to initiate the Phase 2 trial in 2014 using the dose selected in the dose escalation phase. Additionally, in 2014, we plan to expand our clinical trials of EPZ-6438 to include a Phase 2 trial of EPZ-6438 for the treatment of synovial sarcoma. These two Phase 2 trials are intended to provide an initial assessment of efficacy, or proof of concept, in the two genetically defined cancers that we currently seek to treat with EPZ-6438. We have a collaboration agreement with Eisai for our EZH2 program. Under this collaboration, we have a right to opt in to a 50/50 co-development, co-commercialization and profit share arrangement in the United Table of Contents States prior to the initiation of a registration trial. Subject to this right, we have granted Eisai a worldwide license to our EZH2 program, including EPZ-6438. We are working with Roche Molecular Systems, Inc., or Roche, and Eisai to develop a companion diagnostic for this program. Our Therapeutic Collaborations We have entered into a number of strategic collaborations for our therapeutic programs and corresponding companion diagnostics. Our therapeutic collaborations have provided us with $133.3 million in non-equity funding through September 30, 2013. With the additional $29.0 million in milestones earned from Celgene and GSK in December 2013, our therapeutic collaborations will have provided us with a total of $162.3 million in non-equity funding. Our therapeutic collaborations also provide us with research funding and the potential for more than $1.0 billion of research, development, regulatory and sales-based milestone payments, as well as royalties or profit sharing on any net product sales. We have retained commercialization or co-commercialization rights in the United States for all of our programs other than the three programs in our GSK collaboration. We have established the following three therapeutic collaborations: Celgene. In April 2012, we entered into a collaboration and license agreement with Celgene under which we granted Celgene an exclusive license to our DOT1L program outside of the United States, including EPZ-5676. We also granted Celgene the option to license rights outside the United States to other HMT programs, excluding HMT targets covered by our two other existing therapeutic collaborations. We are eligible to receive royalties on net product sales outside of the United States. Under the terms of the agreement, we received a $65.0 million upfront payment and $25.0 million from the sale of our series C preferred stock to an affiliate of Celgene, and in December 2013, we earned a $25.0 million clinical development milestone. In addition, we are eligible to earn up to $135.0 million in additional clinical development and regulatory milestone payments related to DOT1L and up to $165.0 million in option exercise fees and clinical development and regulatory milestone payments related to each additional target as to which Celgene exercises its option during an initial option period ending in July 2015. Celgene has the right to extend the option period until July 2016 by making a significant option extension payment. Eisai. In April 2011, we entered into a collaboration and license agreement with Eisai under which we granted Eisai an exclusive worldwide license to our EZH2 program, including EPZ-6438, while retaining an opt-in right to co-develop, co-commercialize and share profits with Eisai as to licensed products in the United States. Under the terms of the agreement, we have received a $3.0 million upfront payment, $7.0 million in preclinical research and development milestone payments, and a $6.0 million clinical development milestone payment and recorded cash payments and accounts receivable totaling $16.5 million for research and development services through September 30, 2013. We are eligible to receive up to $195.0 million in additional milestone payments, comprising aggregate clinical development and regulatory milestone payments of up to $80.0 million and sales-based milestone payments of up to $115.0 million. We are also eligible to receive royalties on any net product sales. Eisai solely funds all research, development and commercialization costs for licensed compounds. If we exercise our opt-in right to co-develop, co-commercialize and share profits with Eisai, we are required to share ongoing U.S. development costs with Eisai, Eisai is entitled to recover a portion of past development costs as a partial reduction of future milestone payments and royalties, and the milestone payments we are eligible to receive in the future are reduced. GSK. In January 2011, we entered into a collaboration and license agreement with GSK to discover, develop and commercialize novel small molecule HMT inhibitors directed to available targets from our product platform. Under the terms of the agreement, we granted GSK exclusive worldwide license rights to HMT inhibitors directed to three targets. Additionally, as part of the research collaboration provided for in the Table of Contents agreement, we agreed to provide research and development services related to the licensed targets pursuant to agreed upon research plans during a research term that extends to the earlier of January 8, 2015 or the achievement of development candidate declaration as to each selected target. Under the agreement, we have received an upfront payment of $20.0 million. Through September 30, 2013, we also received $6.0 million of research funding and $8.0 million of preclinical research and development milestone payments, and in December 2013, we earned a $4.0 million preclinical research and development milestone. We are eligible to receive up to $626.0 million in additional milestone payments, comprising aggregate preclinical research and development, clinical development and regulatory milestone payments of up to $356.0 million and sales-based milestone payments of up to $270.0 million. In addition, GSK is required to pay us royalties on worldwide net product sales. Risks Associated with Our Business Our business is subject to a number of risks of which you should be aware before making an investment decision. These risks are discussed more fully in the Risk Factors section of this prospectus. These risks include the following: We have incurred significant losses since our inception. Our accumulated deficit was $72.0 million as of September 30, 2013, representing our cumulative losses since our inception in 2007. We expect to incur losses over the next several years and may never achieve or maintain profitability. We will need substantial additional funding. If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts. Our limited operating history may make it difficult for you to evaluate the success of our business to date and to assess our future viability. Our research and development is focused on the creation of personalized therapeutics for patients with genetically defined cancers, which is a rapidly evolving area of science, and the approach we are taking to discover and develop drugs is novel and may never lead to marketable products. The scientific evidence to support the feasibility of developing product candidates based on these discoveries is both preliminary and limited. We believe we are the first company to conduct a clinical trial of an HMT inhibitor. The outcome of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results. For example, it is important to note that the objective responses observed in the dose escalation phase of our Phase 1 clinical trial of EPZ-5676 were achieved by only two of the MLL-r patients enrolled in the trial through the fourth dose cohort, were observed in an open-label setting, are not statistically significant and might not be achieved by any other patient treated with EPZ-5676. We have not yet reported results of the fifth dose cohort, which is ongoing. Clinical drug development involves a lengthy and expensive process, with an uncertain outcome. We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidates. If we are unable to successfully develop companion diagnostics for our therapeutic product candidates, or experience significant delays in doing so, we may not achieve marketing approval or realize the full commercial potential of our therapeutic product candidates. Our existing therapeutic collaborations are important to our business, and future collaborations may also be important to us. If we are unable to maintain any of these collaborations, or if these collaborations are not successful, our business could be adversely affected. Table of Contents If we are unable to obtain and maintain patent protection for our technology and products, or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and products may be impaired. Our Corporate Information We were incorporated under the laws of the state of Delaware on November 1, 2007 under the name Epizyme, Inc. Our principal executive offices are located at 400 Technology Square, Cambridge, Massachusetts 02139 and our telephone number is (617) 229-5872. Our website address is www.epizyme.com. The information contained on, or that can be accessed through, our website is not a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Epizyme and the Epizyme logo are our registered trademarks. The other trademarks, trade names and service marks appearing in this prospectus are the property of their respective owners. Implications of Being an Emerging Growth Company As a company with less than $1.0 billion in revenue during our last fiscal year, we qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. For so long as we remain an emerging growth company, we are permitted and intend to rely on exemptions from specified disclosure requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include: being permitted to provide only two years of audited financial statements, in addition to any required unaudited interim financial statements, with correspondingly reduced Management s Discussion and Analysis of Financial Condition and Results of Operations disclosure; not being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting; not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements; reduced disclosure obligations regarding executive compensation; and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We may take advantage of these provisions through 2018 or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.0 billion in annual revenues, have more than $700.0 million in market value of our capital stock held by non-affiliates as of specified times or issue more than $1.0 billion of non-convertible debt over a three-year period. We may choose to take advantage of some, but not all, of the available exemptions. We have taken advantage of some reduced reporting burdens in this prospectus. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold stock. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This provision allows an emerging growth company to delay the adoption of some accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Table of Contents THE OFFERING Common stock offered by us 3,000,000 shares Common stock offered by the selling stockholders 1,192,679 shares Common stock to be outstanding immediately following this offering 31,617,947 shares Option to purchase additional shares The underwriters have an option to purchase up to 628,901 additional shares of common stock from us as described in Underwriting. Use of proceeds We currently estimate that we will use the net proceeds to us from this offering, together with our existing cash and cash equivalents: to fund a portion of our share of the global development costs for EPZ-5676, including the costs of the expansion stage of our ongoing Phase 1 clinical trial of EPZ-5676 in MLL-r adult patients and MLL-PTD adult patients and our planned Phase 1b clinical trial of EPZ-5676 in MLL-r pediatric patients; to fund a portion of our share of U.S. development costs for EPZ-6438, including the costs of our planned Phase 2 clinical trial of EPZ-6438 in non-Hodgkin lymphoma patients with EZH2 point mutations as part of our ongoing Phase 1/2 clinical trial of EPZ-6438 and our planned Phase 2 clinical trial of EPZ-6438 in synovial sarcoma patients, to the extent that we exercise our opt-in right to co-develop, co-commercialize and share profits in the United States for this product candidate; to fund research and development to build our product platform and advance our pipeline of preclinical product candidates; and for working capital and general corporate purposes. We will not receive any of the proceeds from the sale of shares by the selling stockholders. See the Use of Proceeds section in this prospectus for a more complete description of the intended use of proceeds from this offering.
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+PROSPECTUS SUMMARY The following summary highlights material contained in this prospectus. This summary does not contain all the information you should consider before investing in our securities. Before making an investment decision, you should read the entire prospectus carefully, including the "Risk Factors" section, the financial statements and the notes to the financial statements that appear elsewhere in this prospectus. References to the Company , we, us, and our are references to the combined business of eBullion, Inc, a Delaware corporation and its wholly owned subsidiary, Man Loong Bullion Company Limited, ( Man Loong ) a Hong Kong limited liability company. Business Overview ITEM 1. BUSINESS Business Overview Since April 3, 2013, through our subsidiary Man Loong Bullion Company Limited, a Hong Kong limited liability company ( Man Loong ), we have been an electronic trading member of the Chinese Gold and Silver Exchange Society ( CGSE ), a self-regulatory organization registered in Hong Kong which acts as an exchange for the trading of gold and silver. Man Loong holds a Type AA License with the CGSE, which it uses to provide an electronic trading platform which customers of its agents can use to place trades in a CGSE price contract for Kilo Gold and Loco London Gold and Silver via the electronic trading platform or a telephonic transaction system. The agents customers can access their account to check their gain/loss on their trading position 24 hours a day 7 days a week through Man Loong s electronic trading platform. Man Loong contracts with independent agents, each with their own customers that seek to place trades for gold and silver price contracts with the CGSE using Man Loong s electronic trading platform, which is linked to the CGSE s electronic trading platform by reason of Man Loong s membership in the CGSE. All transactions and technologies used to execute trades are consummated and located at Man Loong s principal offices in Hong Kong. The various independent sales agents who use Man Loong s services, together with the agents customer base, are located in Hong Kong and in the People s Republic of China. Neither we, nor Man Loong, conducts business in the United States or has agents, or any agreements with agents, or facilitate trades with any customers of agents that reside in the United States. The electronic trading platform, which is located in Hong Kong, is licensed by Man Loong from True Technology Company Limited ( True Technology ), a company organized under the laws of Hong Kong, and owned by Mr. Choi, our Chief Executive Officer and 49.5% stockholder and Mr. Wong, one of our directors and stockholders. The electronic trading platform provides the various independent sales agents and their customers with CGSE price quotations on gold and silver price contracts, on a Loco London basis, as well as information updates on the gold and silver market, based on an evaluation of third-party market pricing sources such as Reuters or Bloomberg. The electronic trading platform also provides an agent s customers with up-to-date market data, trade reports and gain/ loss reports to assist them in evaluating their portfolio and effecting trades. In addition, the electronic trading platform communicates and confirms all of the trades that are placed by Man Loong agents and their customers with the CGSE and provides the agents and their customers with confirmation codes which confirm execution of the trades. Man Loong s membership in the CGSE allows it to provide its electronic trading platform to facilitate trades on behalf of the agents customers and/or the agents themselves, who can purchase trading positions in gold and/or silver on the CGSE, without Man Loong being required to become a counterparty to the trade or having to purchase or sell, as principal, any of the gold or silver subject to the price contract being traded. Man Loong merely operates an electronic trading platform which it licenses from True Technology that allows agents customers to directly place trades and become the actual counterparty to the trade for a price contract, which is a product created by the CGSE for electronic trading that does not involve the physical transfer or delivery of any actual gold or silver. The process for effectuating trades on Man Loong s platform are as follows: (i) orders are placed by the agents customers on the trading platform; (ii) the platform, which has a direct connection with the GCSE, communicates the order to the CGSE; (iii) the GCSE matches the trade with a counterparty in the market, which counterparty is unknown to Man Loong, its agents and their customers; (iv) the CGSE then confirms the trade and returns an official confirmation number to the customer through Man Loong s trading platform. The customer can use the confirmation code to verify on the CGSE website the completion of its trade. The trading position represented by the gold or silver price contract remains open until the customer places a trade order using the same procedures set forth in the preceding sentence, to close the open position. Man Loong, through its platform helps facilitate the trade as an official member of the CGSE and earns a commission for its services. Moreover, the gold or silver price contracts do not involve the physical transfer or delivery of any actual gold or silver as there is no physical asset securing the price contract. Man Loong enters into an agency agreement with each agent for which it processes trades pursuant to which the agent agrees to pay a commission to Man Loong for each trade that Man Loong processes and the agent acknowledges that Man Loong has no responsibility for any trading losses suffered by it or its customers for the trades executed on their behalf. Man Loong does not accept customers directly without an agent representative and does not enter into agreements directly with customers for the placement of trades. Although the agent remains directly responsible to Man Loong for any trading losses, to help ensure that the respective agent s customers understand: (i) their assumption of trading risk; (ii) their obligations to their respective agents and (iii) that Man Loong does not have any responsibility for any of their trading losses, Man Loong requires that each agent representative s client for whom Man Loong is requested to process a trade to complete and sign a form acknowledging these risks and obligations prior to commencing trading activity. Any customer that seeks to open a trading account directly with Man Loong is assigned to an agent and is required to execute an agreement with an agent prior to placing a trade. Man Loong receives a commission from the agents ranging from $20 to $40 per trade processed by it regardless of the purchase price paid or received for the gold or silver contract and the agent assumes the sole responsibility to Man Loong and the CGSE for payment of the purchase price of the gold or silver contract traded by it or its customers and for any loss recognized on those trades. The agents often use Man Loong s offices and conference rooms as a physical place to meet with existing and potential customers, and Man Loong provides a dedicated investment center where agents and their customers can access the electronic trading platform to place and process price contract orders for gold, and silver and obtain up-to-date market data, trade reports and gain/ loss reports to assist them in evaluating their portfolio and effecting trades. All of Man Loong s revenue is derived from the commissions it receives on each trade for which it processes through the electronic trading platform it licenses from True Technology. For our fiscal years ended March 31, 2014 and 2013, Man Loong s revenue was approximately $3.0 million and $2.8 million, respectively, and its net income was $0.02 million and $0.54 million, respectively. Our principal offices are located at 80 Broad Street, New York, New York 10004, (212) 837-7858. Man Loong currently has one office in Hong Kong. Man Loong s principal executive offices are located at 8/F, Tower 5, China Hong Kong City, 33 Canton Road, Tsim Sha Tsui, Hong Kong. The telephone number at Man Loong s principal executive office is +852-2155-3999. All of Man Loong s transactions and the technologies, including the servers that carry out these transactions, are all processed and located in Hong Kong. TABLE OF CONTENTS Our Corporate History and Background We were incorporated under the laws of the State of Delaware on January 28, 2013. We were initially formed to develop software for use in on-line trading of gold and silver contracts. Since the acquisition of Man Loong, our business development focus has been, and we expect will continue to be, solely on increasing Man Loong s market share for the on-line trading of gold and silver contracts within the Hong Kong market while developing a business model for the on-line trading of gold and silver contracts by Man Loong in the People s Republic of China. Acquisition of Man Loong On April 3, 2013, we entered into a Contribution Agreement with the shareholders of Man Loong, whereby we acquired 100% of the issued and outstanding capital stock of Man Loong from its stockholders, in exchange for 50,760,000 newly issued shares of our common stock, par value $0.0001. After the transaction, Man Loong became our wholly owned subsidiary. As a result of the acquisition, we have assumed the business and operations of Man Loong. Man Loong, which was incorporated in 1974 in Hong Kong and was re-registered in 2007 under Hong Kong law as a limited liability company, was organized to facilitate the trading of precious metals contracts. Man Loong initially provided an electronic trading platform that offered one-stop electronic trading in Hong Kong, and in 2010, expanded its services to include the trading for its agent s customers and not as principal, of gold and silver contracts in mainland China. Man Loong currently has one office in Hong Kong and 10 independent agents in mainland China located in Shanghai, Guangdong and Fujian provinces. The acquisition of Man Loong was treated for accounting purposes as a reverse merger with eBullion acquiring 100% of the outstanding common stock of Man Loong in exchange for 50,760,000 newly issued shares of our common stock, par value $.0001. Unless the context suggests otherwise, when we refer in this prospectus to business and financial information for periods prior to the consummation of the reverse acquisition, we are referring to the business and financial information of Man Loong. For accounting purposes, the reverse merger of eBullion, Inc. with Man Loong has been treated as a recapitalization with no adjustment to the historical book and tax basis of either companies assets or liabilities. Our Corporate Structure Our primary business operations are conducted through our Hong Kong operating subsidiary, Man Loong. For ease of reference, below is a chart that presents our current corporate structure. Our principal executive offices are located at 80 Broad Street, New York, New York 10004 and Man Loong s principal offices are located at 8/F, Tower 5, China Hong Kong City, 33 Canton Road, Tsim Sha Tsui, Hong Kong. The telephone number at our principal executive offices is (212) 837-7858 and Man Loong s principal executive office is +852-2155-3999. All of our transactions and the technologies, including the servers that carry out these transactions, are all executed and located in Hong Kong. TABLE OF CONTENTS The Offering Shares of our common stock offered for re-sale by the Selling Stockholders pursuant to this prospectus 500,000 Common stock currently outstanding 51,260,000 Proceeds to the Company We will not receive any proceeds from the resale or other disposition of the shares covered by this prospectus by any Selling Stockholder.
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+prospectus summary highlights certain information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read the entire prospectus carefully, including the information under "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the related notes thereto included in this prospectus, before investing. This prospectus includes forward-looking statements that involve risks and uncertainties. See "Special Note Concerning Forward-Looking Statements." Unless the context otherwise requires, the terms "the Company," "we," "us" and "our" in this prospectus refer to WCI Communities, Inc. and its subsidiaries and the term "WCI" in this prospectus refers only to WCI Communities, Inc. Our Company We are a lifestyle community developer and luxury homebuilder of single-and multi-family homes in most of coastal Florida's highest growth and largest markets, in which we own or control approximately 8,500 home sites. We have established a reputation and strong brand recognition for developing amenity rich, lifestyle oriented master-planned communities and, including our predecessor companies, have a legacy that spans more than 60 years. Our homes and communities are primarily targeted to move-up, second home and active adult buyers. We intend to leverage our experience, operational platform and well-located land inventory, with an attractive book value, to capitalize on markets with favorable demographic and economic forecasts in order to grow our business. Our business is organized into three operating segments: homebuilding ("Homebuilding"), real estate services ("Real Estate Services"), and amenities ("Amenities"). Our Homebuilding segment accounted for 65.2% and 47.9% of our total revenues for the nine months ended September 30, 2013 and in 2012, respectively, and substantially all of our total gross margin for the nine months ended September 30, 2013 and in 2012. Homebuilding: We design, sell and build homes across a broad range of price points and sizes. Our land development expertise enhances our Homebuilding operations by enabling us to acquire and create larger, well-amenitized master-planned communities, control the timing of home site delivery and capture the opportunity to drive higher margins. For the nine months ended September 30, 2013, we delivered 342 homes with an average delivered price of $423,000, compared to 150 homes with an average delivered price of $391,000 for the nine months ended September 30, 2012. During 2012, we delivered 352 homes with an average delivered price of $396,000, compared to 128 homes with an average delivered price of $326,000 in 2011. Real Estate Services: We operate real estate brokerage services under the brand Berkshire Hathaway HomeServices and title services that complement our Homebuilding operations. In 2012, our real estate brokerage business was the third-largest brokerage in Florida and the 36th largest in the United States based on sales volume. Amenities: Within many of our communities, we may own and/or operate resort-style club and fitness facilities, championship golf courses, country clubs and marinas. We believe these amenities offer our homebuyers a luxury lifestyle experience, enabling us to enhance the marketability, sales volume and value of the homes we deliver. We believe our business is distinguished by our: significant, well-located land inventory in developed and established communities; proven leadership team, which has extensive experience in our markets; expertise in, and reputation for, developing luxury lifestyle communities with well-managed amenities; AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents TRADEMARKS We have proprietary rights to trademarks used in this prospectus which are important to our business, many of which are registered under applicable intellectual property laws. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the " " or " " symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies' trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Each trademark, trade name or service mark of any other company appearing in this prospectus is the property of its respective holder. STATEMENT REGARDING INDUSTRY AND MARKET DATA This prospectus, in particular the sections entitled "Summary," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business," contains industry and market data, forecasts and projections that are based on internal data and estimates, independent industry publications, government publications, reports by market research firms or other published independent sources. Industry publications and other published sources generally state that the information they contain has been obtained from third-party sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of such information. We have not independently verified the market and industry data obtained from these third-party sources. Our internal data and estimates are based upon information obtained from trade and business organizations and other contacts in the markets in which we operate and our management's understanding of industry conditions, and such information has not been verified by any independent sources. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and additional uncertainties regarding the other forward-looking statements in this prospectus. See "Special Note Concerning Forward-Looking Statements." Table of Contents higher average selling price and lower cancellation rate compared to most other public homebuilders, attributed to our focus on higher-end move-up, second home and active adult buyer base; strong focus and market positioning in most of coastal Florida's highest growth and largest markets; Real Estate Services segment, which provides us with additional opportunities to increase profitability as Florida home prices and new and existing home sales continue to recover; industry-leading gross margins from homes delivered; attractive book value of land inventory, which was reset to then-current fair market values in September 2009; significant deferred tax assets that are currently fully reserved; and well-capitalized balance sheet with sufficient liquidity for growth. As of September 30, 2013, we were actively selling in 24 different neighborhoods situated in nine master-planned communities. For the nine months ended September 30, 2013, we generated $222.6 million in total revenues, $25.7 million in Adjusted EBITDA and an $8.2 million net loss, compared to $135.8 million in total revenues, $3.8 million in Adjusted EBITDA and $32.9 million in net income in the nine months ended September 30, 2012. The unfavorable period-over-period change in net income was primarily attributable to a $19.0 million non-cash preferred stock dividend related to the exchange of our Series A preferred stock for our common stock in July 2013, a $0.7 million preferred stock dividend related to the purchase of the one outstanding share of our Series B preferred stock for cash in April 2013 and a $50.5 million income tax benefit, which improved our 2012 results, partially offset by $17.0 million in expenses related to early repayment of debt for the nine months ended September 30, 2012 compared to $5.1 million for the nine months ended September 30, 2013. In 2012, we generated $241.0 million in total revenues, $19.1 million in Adjusted EBITDA and $50.8 million in net income, compared to $144.3 million in total revenues, $(22.4) million in Adjusted EBITDA and a $47.1 million net loss in 2011. For a discussion of how we calculate Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income (loss) attributable to common shareholders of WCI Communities, Inc., see footnote 3 under the caption " Summary Consolidated Financial and Other Data." Our Industry U.S. Housing Market The U.S. housing market continues to improve from the cyclical low points reached during the 2008 to 2009 national recession. Between the 2005 market peak and 2011, new single-family housing sales declined 76%, according to data compiled by the U.S. Census Bureau, and median resale home prices declined 34%, as measured by the CoreLogic Case-Shiller Index. In 2011, early signs of a recovery began to materialize in many markets around the country as a result of an improving macroeconomic backdrop and a historically high level of housing affordability. For the eleven months ended November 30, 2013, homebuilding permits increased 20.1% as compared to the eleven months ended November 30, 2012. As of November 30, 2013, new home sales remain 68% below peak levels. In November 2013, the median new single family home price was 10.6% higher than the median price in November 2012, outpacing the 9.4% increase in existing single family home median prices over the same period. Florida Housing Market The Florida residential real estate market was the second-largest in the United States, as measured by 2012 permit issuance and 2013 year-to-date permit issuance (single- and multi-family permits), WCI COMMUNITIES, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation or organization) 1531 (Primary Standard Industrial Classification Code Number) 27-0472098 (I.R.S. Employer Identification Number) 24301 Walden Center Drive Bonita Springs, Florida 34134 (239) 947-2600 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents according to data compiled by the U.S. Census Bureau. While the Florida housing market experienced a deeper contraction than other regions in the United States in the recent recession, we believe the Florida housing market now appears to be in the early stages of a recovery. Year-to-date permit issuance through November 30, 2013, has increased 36.3% over the same period during 2012. We believe the Florida housing market recovery is primarily being driven by improving population and employment trends. In 2012, Florida's job base grew by 1.8%, representing a gain of 134,000 jobs, which was slightly above the national average growth rate of 1.7%. In addition, Florida's seasonally adjusted unemployment rate was 6.4% in November 2013, down from 8.0% in November 2012, and 600 basis points lower than the U.S. rate of 7.0%. Florida's unemployment rate in November was lower than the U.S. rate for the ninth consecutive month. We believe statewide economic data and metrics illustrate the improving market and potential opportunity for future growth. Our Competitive Strengths We believe the following strengths provide us with a competitive advantage: Attractive and well-located land positions to support future growth We benefit from a significant and well-located existing land inventory in most of coastal Florida's highest growth and largest markets, in which we own or control approximately 8,500 home sites. Our current land holdings were reset to then-current fair market value upon the finalizing of our restructuring in September 2009, which was at or near the U.S. housing markets cyclical low. The majority of our land holdings are within mature, well-amenitized, developed communities that have an established demand for homes. Our significant land inventory allows us to be opportunistic in identifying and pursuing new land acquisitions and protects us against potential land shortages in the majority of our markets that exhibit land supply constraints. We own or control the home sites for all of our current expected home deliveries through 2014 and over 90% of our current expected home deliveries through 2015. Experienced and proven leadership with strong operational discipline and controls Our executives, senior management and field personnel possess significant operational and management expertise and experience. Our team is led by our chief executive officer, Keith E. Bass, who brings over 25 years of real estate and homebuilding experience to WCI, the last 17 years of which included senior and executive level positions for large public homebuilding and development companies where he oversaw operations in the southeastern United States, including Florida. We believe our management team's prior experience, extensive relationships and respected local reputation provide us with a competitive advantage in acquiring new land, obtaining entitlements, building quality homes and completing projects within budget and on schedule. Expertise in delivering luxury homes in lifestyle communities targeting move-up, second home and active adult buyers We develop luxury, lifestyle communities with many distinguishing and sought-after attributes and amenities. Our recreational amenities, including championship golf courses with clubhouses, fitness, spa, tennis and recreational facilities, walking trails, resort style pools, marinas, movie theaters, town centers, and a variety of restaurants, are central to our mission of delivering luxury lifestyle experiences to our homebuyers. Amenities at our communities are typically owned by us and eventually either turned over to community residents or sold. Given our target buyer demographics, our buyers tend to rely less on mortgage financing for their home purchases and typically provide higher deposits and down payments, compared to our competitors' buyers. For the year ended December 31, 2012 and the nine months ended September 30, Keith E. Bass President and Chief Executive Officer WCI Communities, Inc. 24301 Walden Center Drive Bonita Springs, Florida 34134 Tel (239) 947-2600 Fax (239) 498-8338 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Marc D. Jaffe, Esq. Senet S. Bischoff, Esq. Latham & Watkins LLP 885 Third Avenue New York, New York 10022 Tel (212) 906-1200 Fax (212) 751-4864 Vivien N. Hastings, Esq. Senior Vice President and General Counsel WCI Communities, Inc. 24301 Walden Center Drive Bonita Springs, Florida 34134 Tel (239) 947-2600 Fax (239) 498-8277 Frank J. Lopez, Esq. Robin M. Feiner, Esq. Proskauer Rose LLP Eleven Times Square New York, New York 10036 Tel (212) 969-3000 Fax (212) 969-2900 Table of Contents 2013, approximately 44% and 43%, respectively, of our homebuyers were all-cash buyers, a contributing factor to our low cancellation rates of 3.0% and 4.4%, respectively, of our gross orders during those periods, which rates are below the cancellation rates of most other public homebuilders in the United States during those periods. Well-positioned and focused in attractive, high-growth coastal Florida homebuilding markets We believe that our geographic footprint throughout the state of Florida enables us to capture the benefits of increasing demand for new homes and rising home prices as the Florida housing recovery continues. Additionally, it has been our experience that homes in our communities are sought after by buyers for a variety of reasons, one of which is the communities' proximity to the Florida coast. Real Estate Services segment provides an opportunity to participate in the recovery of Florida resale home prices We operate a full-service real estate brokerage business under the Berkshire Hathaway HomeServices brand in many of the largest metropolitan areas in Florida. In 2012, our real estate brokerage business was the third-largest real estate brokerage in Florida and the 36th largest in the United States based on sales volume. We currently have 41 brokerage offices and exclusive relationships with approximately 1,500 independent licensed real estate agents. Our real estate brokerage business allows us to take advantage of the recovery in Florida resale home prices, supplementing our ability to profit on new home sales through our Homebuilding segment. Additionally, our real estate brokerage business is a source of valuable information on market trends, which our Homebuilding segment benefits from on a real-time basis. Our title and settlement services business, which we operate as Florida Title & Guarantee, allows us to better manage the closing process for our new home deliveries. During 2012 and for the nine months ended September 30, 2013, approximately 82% and 76%, respectively, of our new homebuyers also utilized our title and settlement services. Industry-leading gross margins from homes delivered In 2012, our gross margin from 352 homes delivered as a percentage of revenues from homes delivered was 31.5%, compared to 20.0% from 128 homes delivered in 2011. This improvement was primarily due to the reopening of existing communities within our portfolio, which provided for an increase in the number of homes delivered with higher average selling prices and margins and allowed us to more efficiently leverage our overhead. In addition, for the nine months ended September 30, 2013, our gross margin from 342 homes delivered as a percentage of revenues from homes delivered was 30.6%, compared to 32.3% from 150 homes delivered for the nine months ended September 30, 2012. Our high gross margins from homes delivered are attributable to a combination of our higher average selling prices due to the quality of both our homes and our community amenity offerings and the low book value of our land, which was reset to then-current fair market value upon the finalizing of our restructuring in September 2009. Substantial tax attributes to offset future earnings We have significant deferred tax assets that could be used, subject to the limitations described below, to offset future earnings and reduce the amount of income taxes we are required to pay. As of September 30, 2013, we estimate our net deferred tax assets were approximately $204 million, against which we have currently recorded a full valuation allowance. Our ability to take advantage of our significant deferred tax assets is subject to limitations under Section 382 ("Section 382") of the Internal Revenue Code of 1986, as amended (the "Code"), including in connection with prior stock ownership changes and prospective stock ownership changes that may occur as a result of this offering. In Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. Table of Contents addition, changes in the markets in which we do business and our profitability may limit our ability to take advantage of our deferred tax assets. Balance sheet with sufficient liquidity for growth We believe we are well-positioned with a strong balance sheet and sufficient liquidity with which to service our debt obligations, support our ongoing operations and take advantage of growth opportunities as the expected recovery in the Florida housing market continues. As of September 30, 2013, we had $200.0 million of total debt outstanding, all of which was from our $200.0 million aggregate principal amount of 6.875% Senior Notes due 2021 (the "2021 Notes"), and a total debt-to-total book capitalization of 42.2%. Additionally, as of September 30, 2013, we had $284.8 million of available liquidity from cash and cash equivalents, our Revolving Credit Facility (as defined below) and our $10.0 million senior loan with Stonegate Bank (the "Stonegate Loan"). Business Strategy We believe we are well-positioned for growth in an improving Florida housing market through the disciplined execution of the following elements of our strategy: Utilize our attractive book value land inventory to open new communities and neighborhoods Our land inventory provides us with the opportunity to substantially increase our neighborhood count irrespective of additional land acquisitions in the near-term. We intend to opportunistically open neighborhoods from within our existing land holdings, as they contain significant capacity for additional development. Since our land inventory was reset to then-current fair market value upon the finalizing of our restructuring in September 2009, it is carried on our balance sheet at relatively low book values. Consequently, our margins should benefit from the ultimate development and future sale of homes on this land. Maximize profitability through the combination of our land acquisition and development expertise We evaluate land opportunities using a comprehensive business model focused on, among other things, demographic, macroeconomic and micro-market trends in order to determine the appropriate positioning in the market and probability of success. We believe we continue to obtain the "first look" at many quality land opportunities in our existing and target markets due to our local relationships with land sellers, brokers and investors. We also believe our land development expertise enhances our Homebuilding operations by enabling us to acquire and create larger, well-amenitized master-planned communities, control the timing of home site delivery and capture the opportunity to drive higher margins. Additionally, we have the experience and internal expertise to entitle, reposition and/or rezone potential land acquisitions that we believe will help us achieve attractive returns in the future. Create luxury master-planned communities that contribute to an outstanding homeowner experience Our core operating philosophy is to provide our homebuyers a positive, memorable experience from the time they walk into our sales office until well after we have delivered their home. We actively engage buyers in every aspect of the building process, from tailoring our product to their lifestyle needs, with attractive design selections to providing them updates on the entire construction process up to the point of delivering their home. Additionally, we believe we attract buyers to purchase homes in our master-planned communities because of their prime locations and amenity offerings we create. As a result, our selling process focuses on the quality of our amenities and the lifestyle they provide, in addition to the excellent design and construction of our homes. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents Increase market position in growth markets We believe there are significant opportunities to profitably expand in both our existing and new markets based on demographic and economic data, our own operating results and information gathered from our Real Estate Services segment. Our primary growth strategy is to focus on opportunities to grow market position within our existing coastal markets to leverage existing infrastructure. We evaluate land opportunities using a comprehensive business model focused on, among other things, demographic, macroeconomic and micro-market trends in order to determine the appropriate positioning in the market and probability of success. Offer a variety of new home products In order to meet the varying needs and desires of our target homebuyers, we maintain the expertise to deliver a variety of new home product lines, which gives us an opportunity to increase our market share. Our expertise allows for a diversified product strategy that enables us to better serve a wide range of buyers, adapt quickly to changing market conditions and optimize performance and returns while strategically reducing portfolio risk. Our Homebuilding operation has the flexibility to efficiently deliver an extensive range of single- and multi-family homes to target both buyers that may be looking for value oriented product, as well as those desiring the most luxurious of homes. Focus on scalable cost structure to enhance returns We believe that our Homebuilding platform and our senior management's hands-on approach and focus on controlling costs favorably position us to generate attractive returns for our investors. We competitively bid each phase of the development and construction process and preserve strong relationships with our trade partners by closely managing production schedules and paying in a timely manner. Our Homebuilding operations strive to maximize floor plan re-use among communities, maintain cycle time control, and implement home construction cost initiatives. We have also made and continue to make significant investments in systems and infrastructure to continue to support and operate our business efficiently. As a result, our operation is scalable and the near-term future growth is not expected to require considerable additional overhead, leading to the efficient execution of our expansion strategy. Grow our Real Estate Services segment in order to take advantage of rising Florida resale home prices Our real estate brokerage business positions us to benefit from the housing recovery in Florida resale home prices. As distressed home sales as a percentage of total sales continues to drop, and new home sales as a percentage of total sales continues to increase, we expect the average selling price of homes across Florida to appreciate, driving margin growth in our real estate brokerage business. As our real estate brokerage business is highly scalable, we believe there are opportunities to further improve our profitability by growing our geographic footprint organically, through opportunistic acquisitions and "roll-in" brokerages. This business also helps provide valuable, real-time insight into market trends, buyer preferences and demand for different products and locations, which we will continue to use to evaluate land opportunities, community and amenity plans and home designs in our Homebuilding operations. Maintain a disciplined capital structure We intend to employ both debt and equity, coupled with redeployment of cash flows from continuing operations, as part of our ongoing financing strategy to fund future growth and operations. As a means of sustaining our long-term financial health and limiting our exposure to unforeseen dislocations in the debt and financing markets, we currently expect to remain conservatively leveraged by targeting a net debt-to-net book capitalization of below approximately 40%. We believe our unique combination of a long-owned land supply coupled with a modest leverage position will enable us to CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered(1) Proposed Maximum Offering Price per Share(2) Proposed Maximum Aggregate Offering Price(1)(2) Amount of Registration Fee(3) Common Stock, $0.01 par value per share 5,175,000 $18.75 $97,031,250 $12,497.63 (1)Includes shares of common stock that may be purchased by the underwriters pursuant to their option to purchase additional shares of common stock. (2)Estimated solely for purposes of determining the registration fee in accordance with Rule 457(c) under the Securities Act of 1933, as amended, based on the average of the high and low sales prices of the common stock as reported by the New York Stock Exchange on January 2, 2014. (3)The registration fee was previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents continue to generate solid cash flow and the flexibility to grow while protecting us against future cyclical downturns. Recent and Pending Land Acquisitions Subsequent to September 30, 2013, we entered into a land option contract to acquire 84 home sites in one neighborhood, situated in a master-planned community in Southwest Florida, for an aggregate purchase price of approximately $12.2 million, net of deposits. The first closing under the land option contract occurred on December 17, 2013, in the amount of $2.6 million for 18 home sites. The remaining 66 home sites are expected to close during 2014 through 2016. There can be no assurances that we will acquire any of these home sites on the terms or timing anticipated, or at all, or that we will proceed to sell and build homes on any of the land we own, control or acquire. See "Risk Factors Risks Related to Our Business We may not be successful in our effort to identify, complete or integrate acquisitions, which could adversely affect our results of operations and future growth." Risks Related to Our Business Investing in our common stock involves substantial risk. You should carefully consider all of the information in this prospectus prior to investing in our common stock. There are several risks related to our business that are described under "Risk Factors" elsewhere in this prospectus. Among these important risks are the following: a slowing or reversal of the present housing market recovery; downturns or cyclical economic conditions affecting the homebuilding industry, including changes in short- and long-term interest rates and employment levels and job and personal income growth; our geographic concentration in Florida; shortages and price fluctuations in labor, raw materials and building supply and other problems in the construction of our communities; the unavailability of land or significant fluctuations in the market value of land; our ability to obtain permits, development approvals and entitlements in order to develop our communities successfully and in a timely manner; our ability to comply with extensive federal, state and local governmental regulation, including applicable zoning, permitting, environmental, tax and other laws and regulations; substantial increases in mortgage interest rates or the unavailability of mortgage financing; limitations on the utilization of our deferred tax assets, including our net operating loss carryforwards, due to changes in the markets in which we do business, our profitability, ownership changes or other reasons; an increase in warranty, liability and other claims that arise in the ordinary course of business and unforeseen product liability claims; our ability to service our indebtedness, obtain sufficient financing on terms acceptable to us and to operate or expand our business as planned; and because of their significant stock ownership, the substantial influence that our Principal Investors (as defined herein) have over our business, and that their interests may differ from our interests or those of our other shareholders. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 6, 2014 PRELIMINARY PROSPECTUS 4,500,000 Shares WCI Communities, Inc. Common Stock Table of Contents Our Restructuring On August 4, 2008, our predecessor company and certain of its subsidiaries filed voluntary petitions for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware in Wilmington (the "Bankruptcy Court"). The bankruptcy filings were the result of a highly leveraged balance sheet, the global recession and a severe housing downturn. We emerged from bankruptcy on September 3, 2009 with a $300.0 million senior secured term loan and a $150.0 million senior subordinated secured term loan. In addition, all of our assets and liabilities, including our land portfolio, were reset to then-current fair market value. Given our emergence from bankruptcy in 2009 and the challenges within the homebuilding and real estate industries at that time, a significant part of our business strategy in 2010 and 2011 was focused on selling assets that we deemed non-core to our continuing operations and reducing our general and administrative expenses to maximize our cash position and pay down our outstanding debt. Pursuant to this business strategy, during 2010 and 2011, we sold substantially all of our assets outside of the state of Florida, a majority of our speculative inventory of homes and certain other real estate inventory and amenities assets that we deemed non-core to our continuing operations. Despite the difficult economic environment, we maximized proceeds from such sales, in 2010 and 2011, and we were able to pay down $331.2 million in aggregate principal amount of our indebtedness prior to its stated maturity, including all of the remaining debt outstanding under our senior secured term loan. During 2012, we used the net proceeds from the issuance of $50.0 million in common stock issued to certain of our existing shareholders or their affiliates in a rights offering and $125.0 million of our Senior Secured Term Notes due 2017 (the "2017 Senior Secured Term Notes") issued to certain of our existing shareholders or their affiliates to repay the remaining $162.4 million outstanding under our senior subordinated secured term loan. For additional information regarding our restructuring, see "Management's Discussion and Analysis of Financial Condition and Results of Operation Our Restructuring." 2013 Financing Transactions On July 30, 2013, we completed the initial public offering (the "Initial Public Offering") of our common stock and issued 6,819,091 shares of common stock at a price to the public of $15.00 per share, which provided us with $90.3 million of net proceeds after deducting underwriting discounts and offering expenses payable by us. On August 7, 2013, we completed the issuance of the 2021 Notes in a private offering. The net proceeds from the offering of the 2021 Notes (the "Notes Offering") were $195.5 million after deducting fees and expenses payable by us. We used $127.0 million of the net proceeds from the Notes Offering to voluntarily prepay the entire outstanding principal amount of our 2017 Senior Secured Term Notes, of which $125.0 million in aggregate principal amount was outstanding, at a price equal to 101% of the principal amount, plus accrued and unpaid interest. In addition, on August 27, 2013, we entered into a four-year senior unsecured revolving credit facility in an aggregate amount of up to $75.0 million (the "Revolving Credit Facility"), of which up to $50.0 million may be utilized for letters of credit. As of September 30, 2013, we had $200.0 million of total debt outstanding, all of which was from our 2021 Notes. Additionally, as of January 3, 2014, there were no amounts drawn on the Revolving Credit Facility or any limitations on our borrowing capacity, leaving the full amount available to us on such date. Corporate Information WCI Communities, Inc. was incorporated in Delaware in 2009 and our predecessor was founded in 1998. On July 30, 2013, we completed our Initial Public Offering. Our common stock is listed on the New York Stock Exchange under the ticker symbol "WCIC." This is a public offering of shares of WCI Communities, Inc. The shares of common stock are being sold by the selling stockholders. We will not receive any of the proceeds from the shares of common stock sold by the selling stockholders. Our common stock is listed on the New York Stock Exchange under the symbol "WCIC." On January 3, 2014, the last reported sale price of our common stock on the New York Stock Exchange was $19.01 per share. The underwriters have an option to purchase a maximum of 675,000 additional shares of our common stock from the selling stockholders. We are an "emerging growth company" as defined under the federal securities laws and are eligible for reduced reporting requirements. See "Summary Implications of Being an Emerging Growth Company." Investing in our common stock involves risks. See "Risk Factors" beginning on page 17. Price to Public Underwriting Discounts and Commissions(1) Proceeds to Selling Stockholders Per Share $ $ $ Total $ $ $ Table of Contents Our principal executive offices are located at 24301 Walden Center Drive, Bonita Springs, Florida 34134. Our main telephone number is (239) 947-2600. Our internet website is www.wcicommunities.com. The information contained in, or that can be accessed through, our website is not incorporated by reference and is not a part of this prospectus. Implications of Being an Emerging Growth Company We qualify as an "emerging growth company" as defined in the Jumpstart our Business Startups Act of 2012 (the "JOBS Act"). An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include: a requirement to have only two years of audited financial statements and only two years of related selected financial data and management's discussion and analysis of financial condition and results of operations disclosure in this prospectus; an exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"); an exemption from new or revised financial accounting standards until they would apply to private companies and from compliance with any new requirements adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation; reduced disclosure about the emerging growth company's executive compensation arrangements; and no requirement to seek non-binding advisory votes on executive compensation or golden parachute arrangements. The JOBS Act permits emerging growth companies to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We previously chose to "opt out" of this provision and, as a result, we will comply with new or revised accounting standards as required when they are adopted. Our decision to opt out of the extended transition period is irrevocable. We have elected to adopt the reduced disclosure requirements available to emerging growth companies, including only providing two years of audited financial statements and only two years of related selected financial data and management's discussion and analysis of financial condition and results of operations disclosure in this prospectus. As a result of these elections, the information that we provide in this prospectus may be different than the information you may receive from other public companies in which you hold equity interests. In addition, it is possible that some investors will find our common stock less attractive as a result of our elections, which may result in a less active trading market for our common stock and more volatility in our stock price. We may take advantage of these provisions until we are no longer an emerging growth company. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of our Initial Public Offering, (b) in which we have total annual gross revenue of at least $1.0 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. We may choose to take advantage of some but not all of these reduced disclosure requirements. (1)See "Underwriting" for a description of the compensation payable to the Underwriters. Delivery of the shares of common stock will be made on or about , 2014 Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Credit Suisse J.P. Morgan Citigroup Raymond James Zelman Partners LLC FBR JMP Securities The date of this prospectus is , 2014 Table of Contents The Offering Common stock offered by the selling stockholders 4,500,000 shares Common stock to be outstanding after this offering 25,768,035 shares Option to purchase additional shares The underwriters have a 30-day option to purchase up to 675,000 additional shares of our common stock from the selling stockholders. Use of proceeds We will not receive any proceeds from the sale of common stock by the selling stockholders in this offering. See "Use of Proceeds." Dividend policy We currently intend to retain any future earnings to finance the development and expansion of our business and, therefore, do not intend to pay cash dividends on our common stock for the foreseeable future. Our ability to pay cash dividends on our common stock is limited by the indenture governing our 2021 Notes and the credit agreement governing our Revolving Credit Facility. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, restrictions contained in any financing instruments and such other factors as our board of directors deems relevant. See "Dividend Policy." New York Stock Exchange Symbol "WCIC."
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+PROSPECTUS SUMMARY This summary highlights information appearing elsewhere in this prospectus. You should read the following summary together with the more detailed information appearing in this prospectus, including our financial statements and related notes, and the risk factors beginning on page 15, before deciding whether to purchase shares of our common stock. Unless the context otherwise requires, we use the terms Benefitfocus , the Company , our company , we , us , and our in this prospectus to refer to the consolidated operations of Benefitfocus, Inc. and its consolidated subsidiaries as a whole. Benefitfocus, Inc. Overview Benefitfocus is a leading provider of cloud-based benefits software solutions for consumers, employers, insurance carriers, and brokers. The Benefitfocus platform provides an integrated suite of solutions that enables our customers (which are employers and insurance carriers) to more efficiently shop, enroll, manage, and exchange benefits information. Our web-based platform has a user-friendly interface designed to enable insured individuals and their dependents (which we refer to as consumers or members) to access all of their benefits in one place. Our comprehensive solutions support core benefits plans, including healthcare, dental, life, and disability insurance, and voluntary benefits plans, such as critical illness, supplemental income, and wellness programs. As the number of employer benefits plans has increased, with each plan subject to many different business rules and requirements, demand for the Benefitfocus platform has grown. The Benefitfocus platform enables our customers to simplify the management of complex benefits processes, from sales through enrollment and implementation to ongoing administration. It provides consumers with an engaging, highly intuitive, and personalized user interface for selecting and managing all of their benefits via the web or mobile devices. Employers use our solutions to streamline benefits processes, keep up with complex regulatory requirements, control costs, and offer a greater variety of plans to attract, retain, and motivate their employees. Insurance carriers use our solutions to more effectively market offerings, manage billing, and improve the enrollment process. We also provide a network of over 900 benefit provider data exchange connections, which facilitates the otherwise highly fragmented interaction among employees, employers, and carriers. We serve two separate but related market segments. Our fastest growing market segment, the employer market, consists of employers offering benefits to their employees. Within this segment, we mainly target large employers with more than 1,000 employees, of which we believe there are approximately 18,000 in the United States. In our other market segment, we sell our solutions to insurance carriers, enabling us to expand our overall footprint in the benefits marketplace by aggregating many key constituents, including consumers, employers, and brokers. We believe our presence in both the employer and insurance carrier markets gives us a strong position at the center of the benefits ecosystem. As of June 30, 2014, we served over 23 million consumers on the Benefitfocus platform. As of March 31, 2014, we served 418 large employer customers, an increase from 121 in 2009, and 43 carrier customers, an increase from 28 in 2009. We sell the Benefitfocus platform on a subscription basis, typically through annual contracts with our employer customers and multi-year contracts with our insurance carrier customers, with subscription fees paid monthly. Our software-as-a-service, or SaaS, model provides us visibility into our future operating results through increased revenue predictability, which enhances our ability to manage our business. Historically, our annual software services revenue retention rate has been in excess of 95%. Our total revenue increased from $81.7 million in 2012 to $104.8 million in 2013, Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus dated July 14, 2014 2,500,000 Shares Common Stock A stockholder of Benefitfocus, Inc. is offering all 2,500,000 shares of common stock. We will not receive any of the proceeds from the sale of the shares being offered by the selling stockholder. Our common stock is listed on the NASDAQ Global Market under the symbol BNFT . The last reported sale price of our common stock on the NASDAQ Global Market on July 11, 2014 was $42.27. Upon completion of this offering, we will remain a controlled company as defined under the NASDAQ Stock Market listing rules. We are an emerging growth company under the federal securities laws and are eligible for reduced public company reporting requirements. Investing in our common stock involves a high degree of risk. See Risk Factors beginning on page 15. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to the selling stockholder $ $ (1) The underwriters will receive compensation in addition to the underwriting discount. See Underwriting (Conflicts of Interest) on page 145 of this prospectus for a description of the compensation payable to underwriters. To the extent that the underwriters sell more than 2,500,000 shares of common stock, the underwriters have the option to purchase up to an additional 375,000 shares from the selling stockholder at the offering price less the underwriting discount. The underwriters expect to deliver the shares against payment in New York, New York on , 2014. Goldman, Sachs & Co. Deutsche Bank Securities Jefferies Canaccord Genuity Piper Jaffray Raymond James Prospectus dated , 2014. Table of Contents representing a 28.2% year-over-year increase. Our employer revenue increased from $23.8 million in 2012 to $40.7 million in 2013, representing a 71.1% year-over-year increase. Our carrier revenue increased from $58.0 million in 2012 to $64.1 million in 2013, representing a 10.6% year-over-year increase. We had net losses of $14.9 million in 2012 and $30.4 million in 2013. Our company was founded in 2000, and we currently employ approximately 1,195 associates. Industry Background The administration and distribution of benefits to employees is costly and complex. It requires the exchange of information, application of rules, and transfer of funds among a wide variety of constituents, including consumers, employers, insurance carriers, brokers, benefits outsourcers, payroll processors, and financial institutions. According to IBISWorld calculations, in 2014, the market for human resources, or HR, benefits administration in the United States is expected to grow to over $61 billion. In addition, Gartner estimates that in 2013, the U.S. insurance industry spent over $58 billion on software and related services.1 The current system for providing benefits is changing rapidly and suffers from significant inefficiency as a result of complexity, regulation, and the involvement of multiple parties, leaving room for substantial improvement along the entire benefits value chain. Employer Market As of 2010, according to the United States Census Bureau, there were approximately 5.7 million employers in the United States. Currently, we believe there are over 18,000 entities that employ more than 1,000 individuals. A significant and growing portion of employers costs is non-salary benefits, such as the health insurance that they provide to their employees. Employers recognize the importance of offering a greater variety of core and voluntary benefits as a means to attract, motivate, and retain employees. They must maintain relationships with multiple insurance carriers and many other benefits providers, placing a substantial administrative burden on their organizations. Employers distribution, management, and administration of employee benefits has historically consisted of error-prone, paper-based processes, and a patchwork of customized software tools, which are costly to maintain, often lack necessary functionality, and fail to address the increasing complexity of the benefits marketplace. Employers are increasingly interested in SaaS solutions that can help capture and analyze benefits data, increase efficiency and contain costs, and ultimately lead to healthier, happier, and more productive employees. Insurance Carrier Market The employee benefits market consists of a myriad of insurance carriers and products. According to the U.S. Bureau of Labor Statistics, the single largest benefit provided to employees in the United States is healthcare insurance, often encompassing more than 90% of all insurance benefits spending by employers. According to SNL Financial data, the U.S. private healthcare insurance market consists of approximately 357 carriers covering approximately 246 million individual consumers. Carriers provide benefits primarily through over 5.7 million U.S. employers. Carrier IT systems typically consist of an enterprise software platform that handles claims management, claims re-pricing, insurance premium billing, network management, and case management. Despite widespread carrier consolidation, numerous disparate systems remain in place, with many large carriers operating on multiple IT systems. The effective delivery and management of 1 Gartner, Forecast: Enterprise IT Spending by Vertical Industry Market, Worldwide 2012-2018, 1Q14 Update, United States Insurance Market Spending on Software, IT Services, and Internal Services. Table of Contents Table of Contents healthcare benefits depends on the timely, continuous exchange of data among carriers, their employer customers, and individual members. Legacy benefits management systems often lack important functionality such as web and mobile self-service capabilities and real-time data exchange. Critical carrier processes, including member enrollment, billing, communications, and retail marketing have often been under-optimized or neglected by legacy systems, and carriers have devoted significant internal resources to cover technology gaps. Governmental oversight, punctuated with the passage of the Patient Protection and Affordable Care Act, or PPACA, has led to an increasingly intricate regulatory framework under which health benefits are delivered, accessed, and maintained. PPACA significantly expands insurance coverage through the individual mandate, with the goal of providing healthcare insurance to all U.S. citizens. To encourage enrollment, PPACA introduces a new distribution model in the form of healthcare exchanges online marketplaces that allow insurance carriers to compete directly for new members. PPACA authorized the creation of publicly funded state exchanges in which individuals and small businesses can purchase health insurance directly from carriers. In addition to these federally mandated public exchanges, a number of private entities, including benefit outsourcers, carriers, and brokers are establishing their own private exchanges. We expect private exchanges will be less rigid, promoting both health and non-health benefits, with substantially fewer rules around the types of benefits offered. As insurance carriers continue to bolster their retail distribution capabilities, we believe they will require new technology solutions to attract additional members through private exchanges. The Benefitfocus Solutions We provide a multi-tenant cloud-based benefits platform to the employer and carrier markets. The Benefitfocus platform offers an integrated suite of software solutions that enables our customers to more efficiently shop, enroll, manage, and exchange benefits information. We believe our solutions help employers in the following important ways: Simplify Benefits Enrollment. Our solutions reduce the complexity of benefits enrollment by integrating all plan information in one place and presenting it to employees in an organized and easy-to-understand manner. Employees shop and enroll using a highly intuitive and engaging consumer-oriented interface. Transition to Defined Contribution Benefits Funding Model. Our solutions help enable employers ongoing shift to defined contribution plans. Defined contribution plans differ from traditional defined benefit plans as they grant employees a stipend with which to purchase benefits of their choosing. Defined contribution plans also offer more discretion and options compared to defined benefit plans. Our products support traditional defined benefit plans, allowing employees to select from a list of benefits offered by their employer, calculating required member contributions, and recording and transmitting elections and other important information to payroll. Separately, with respect to defined contribution plans, our exchange solutions help facilitate an online shopping environment with many benefits options that allows employees to select personalized benefit offerings to suit their individual needs. Reduce Cost and Increase ROI. Our solutions automate the benefits management process and reduce the cost associated with clerical errors and covering ineligible employees and dependents. Our solutions also include advanced analytics that enable employers and employees to quickly gather, report, and forecast benefit costs. Table of Contents FOUNDED 2000 HEADQUARTERS Charleston, SC OFFICES Greenville, SC Tulsa, OK San Francisco, CA PORTFOLIO OF PRODUCTS HR InTouch eEnrollment eBilling eExchange eSales eDirect Marketplace Benefit Informatics Media & Animation All Your Benefits. One Place. The Benefitfocus platform provides an integrated suite of solutions that enables our customers (employers and insurance carriers) to more efficiently shop, enroll, manage, and exchange benefits information. More than 23 million insured individuals and their dependents (our consumers or members) manage all types of benefits on the Benefitfocus platform. Consumers on the Benefitfocus Platform The Benefitfocus portfolio of products supports every phase of the benefits lifecycle: LAN DESIGN A P ND SURANCE CAR IN RIE SELECTION R OP EN PLE CO AN N A I S M R T S NI O D A L Y MU N L A N G L N IAM E A C A N N T ID T O N L C T A I A N ) N M E L D S M L U L L O E R X T O P I L N E I RE N Z N& A E S E T I N P O E O N O PS H ( M BI G ) A LLI I N E E N NG G O C G AGE ON A N A N ME TE N H NT AIN X C M &E AGE (MAN 20 10 0 Dec 08 Dec 09 Dec 10 Dec 11 Dec 12 13 June 14 23 million Table of Contents Attract, Retain, and Motivate Employees. Our solutions help employers attract, retain, and motivate top talent by delivering benefits information through a highly intuitive and engaging user interface. We believe that when employees understand the value of their benefits, they are more likely to be satisfied with and engaged in their jobs. Streamline HR Processes. Our solutions eliminate the time-consuming and labor-intensive, often paper-based, processes associated with managing employee benefits plans, making HR professionals more efficient. Employers and HR professionals can efficiently enroll users or update information, and communicate or make changes to plans in real-time. Integrate Seamlessly with other Related Systems. Our solutions can be easily and securely integrated with a variety of related systems, including carrier membership and billing systems, payroll and HR systems, banks, and other third-party administrators. We provide a network of over 900 benefit provider data exchange connections. Our open architecture further extends our functionality by allowing third parties to develop and offer apps and services on our platform. We believe our solutions help insurance carriers in the following important ways: Attract and Maintain Membership. Our solutions allow carriers to maximize sales capacity and efficiency by communicating directly with their employer customers and individual members. Carriers can track leads, generate quotes, create proposals with multiple products, and quickly follow-up with potential customers and members. Reduce Administrative Costs. The Benefitfocus platform allows carriers to automate and simplify various aspects of the benefits administration process, such as enrollment, plan changes, eligibility updates, and billing, from one centralized location. Bolster Retail Distribution Capabilities Through Private Exchanges. Our solutions help carriers respond to an evolving marketplace in which retail distribution capabilities are increasingly important to attracting and retaining new members. Our private exchange platform offers carriers a lower cost direct sales channel to employer groups and individuals. We offer the ability to sell both healthcare and non-healthcare benefit products in an online shopping environment that serves as an alternative to government-sponsored public exchanges. Facilitate Real-Time Data Exchange. Our solutions simplify interactions and data exchange and foster collaboration among carriers and their partners, brokers, employer customers, and individual members. This allows carriers to rapidly tailor and offer new benefits packages. Our Growth Strategy We intend to strengthen our position as a leading provider of cloud-based benefits software solutions. Key elements of our growth strategy include the following: Expand our Customer Base. We believe that our current customer base represents a small fraction of our targeted employers and carriers that could benefit from our solutions. In order to reach new customers in our existing employer and carrier markets, we are aggressively investing in our sales and marketing resources. Table of Contents Table of Contents Deepen our Relationships with our Existing Customer Base. We are deepening our employer relationships by continuing to provide a unified platform to manage increasingly complex benefits processes and simplify the distribution and administration of employee benefits. We are expanding our carrier relationships through both the upsell of additional software products and increased adoption across our carriers member populations. Extend our Suite of Applications and Continue our Technology Leadership. We are extending the number, range, and functionality of our benefits applications. For example, we recently launched the new Benefitfocus Plan Shopping app, which allows employees to use actual claims data when comparing available benefits plans. We have also extended the functionality of our products with various mobile applications. We intend to continue our collaboration with customers and partners, so we can respond quickly to evolving market needs with innovative applications and support our leadership position. Further Develop our Partner Ecosystem. We have established strong relationships with organizations such as SuccessFactors, Allstate Insurance Company, the Mayo Clinic, and others in a variety of industries to deliver best-in-class applications to our customers. We plan to continue to invest in our integration infrastructure to allow third parties and customers to build custom applications on the Benefitfocus platform and create deep integrations between their systems and ours. Leverage our Corporate Culture. We believe our culture benefits our associates and customers and supports our growth. We plan to continue to invest in our culture to help attract and retain top design and engineering professionals that are passionate about Benefitfocus and motivated to create superior software technology. Target New Markets. We believe substantial demand for our solutions exists in markets and geographies beyond our current focus. We intend to leverage opportunities we believe will arise from the complexities of changing government regulation and increased enrollment impacting both Medicare and Medicaid. We also plan to grow our sales capability internationally by expanding our direct sales force and collaborating with strategic partners in new, international locations. Selected Risks Affecting Our Business Our business is subject to a number of risks you should be aware of before making an investment decision. These risks are discussed more fully in Risk Factors beginning on page 15 and include: We have had a history of losses, and we might not be able to achieve or sustain profitability. Our quarterly operating results have fluctuated in the past and might continue to fluctuate, causing the value of our common stock to decline substantially. We operate in a highly competitive industry, and if we are not able to compete effectively, our business and operating results will be harmed. The market for our products and services is immature and volatile, and if it does not develop or if it develops more slowly than we expect, the growth of our business will be harmed. If the number of individuals covered by our employer and carrier customers decreases or the number of products or services to which our employer and carrier customers subscribe decreases, our revenue will decrease. Table of Contents TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights some information from this prospectus, and it may not contain all the information important to making an investment decision. A potential investor should read the following summary together with the more detailed information regarding the Company and the common stock being sold in this offering, including Risk Factors and the financial statements and related notes, included elsewhere in this prospectus. The Company History Gaming Entertainment International Inc. (the Company ) was incorporated in the state of Nevada on December 28, 2012 for the purpose of acquiring Walley Communications Consulting, Inc ( Walley ), whereby they could pursue their combined business plan of providing gambling and gaming entertainment services. On December 28, 2012, the Company executed a share exchange agreement with Walley, whereby it issued 25,000 common shares for all of Walley s outstanding stock. As a result, Walley became a wholly owned subsidiary of the Company. On February 4, 2014, the Company executed an amendment to the share exchange agreement with Walley dated December 28, 2013, whereby the parties involved agreed to change the consideration paid by the Company for all of the outstanding stock of Walley from 25,000 shares of the Company to an unsecured promissory note in the amount of $25,000. The amended Walley purchase agreement, filed as an exhibit herein, will nullify the original share exchange agreement dated December 28, 2012. Walley was a privately owned company incorporated under the state laws of Mississippi on July 27, 2006. Walley Communications Consulting s operations centered primarily in the casino industry and included the provision of consulting and installation services to electrical engineers, electrical contractors, cabling contractors, and end users. Gaming Entertainment International, Inc. is now located at 9510 W. Sahara Avenue, Suite 120, Las Vegas, Nevada 89117. Risks and Uncertainties facing the Company The Company has a limited operating history and may experience losses in the near term. We may be dependent on sales of our equity securities and debt financing to meet our cash requirements for the future proposed expansion of operations. As of December 31, 2013, we had an accumulated deficit of $49,508. The Company needs to maintain a steady operating structure, ensuring that expenses are contained such that profits are consistently achieved. In order to expand the Company s business, the Company would likely require additional financing. Management of the Company must continually develop and refine its strategies and goals in order to execute the business plan of the Company on a broad scale and expand the business. One of the biggest challenges facing the Company will be in securing adequate capital to continue to expand its business and increase operations. Secondarily, an ongoing challenge remains the maintenance of an efficient operating structure and business model. The Company must keep its expenses and the costs of employees at a minimum in order to generate a profit from the revenues that it receives from its clients. Third, in order to expand, the Company will need to continue implementing effective sales and marketing strategies to reach and forge new business relationships. The Company has devised its initial sales, marketing and advertising strategies, however, the Company will need to continue refinement of these strategies and also skillfully implement these plans in order to achieve ongoing and long-term success in its business. Fourth, the Company must continuously identify, attract, solicit and manage employee talent, which requires the Company to consistently recruit, incent and monitor various employees. High employee turnover or attrition is a significant risk for the Company, as it requires expending substantial resources to locate and train new personnel and also to replace personnel for clients. These tasks require significant time and attention from the Company s management, and employees may nevertheless become dissatisfied with their respective tenure with the Company. Due to financial constraints and the early stage of the Company s life, the Company has to date conducted limited advertising and marketing to reach customers. In addition, the Company has not yet located the sources of funding to develop the Company on a broader scale through acquisitions or other major partnerships. If the Company were unable to locate such financing and/or later develop strong and reliable sources of potential new business relationships and a means to efficiently reach new business partners and customers, it is unlikely that the Company will be able to develop its proposed expanded operations and business plan. Moreover, the above assumes that the Company s services are consistently met with client satisfaction in the marketplace and exhibit steady success amongst the potential customer base, neither of which is reasonably predictable or guaranteed. Our auditors have questioned our ability to continue operations as a going concern. Investors may lose all of their investment if we are unable to continue operations and generate revenues. We hope to obtain significant revenues from future product sales. In the absence of significant sales and profits, we may seek to raise additional funds to meet our working capital needs, principally through the additional sales of our securities. However, we cannot guarantee that we will be able to obtain sufficient additional funds when needed, or that such funds, if available, will be obtainable on terms satisfactory to us. As a result, substantial doubt exists about our ability to continue as a going concern. Gaming Entertainment International Inc. qualifies as an "emerging growth company" as defined in the Jumpstart our Business Startups Act (the "JOBS Act"), which was recently signed into law April 5, 2012. The Company therefore will be subject to reduced public company reporting requirements. An emerging growth company is a company with annual gross revenues of less than $1,000,000,000 during its most recently completed fiscal year. An emerging growth company retains its status and reduced regulatory and reporting requirements associated with it until the earliest of: the last day of the first fiscal year during which the Company has annual gross revenues of $1,000,000,000 or more; the last day of the first fiscal year following the fifth anniversary of the Company's initial public offering ("IPO"); the date on which the Company has, during the previous three year period, issued more than $1,000,000,000 in non-convertible debt; or the date on which the Company is deemed to be a large accelerated filer. The Company is an emerging growth company for purposes of the Securities Act and the Securities Exchange Act if the first sale of common equity securities of such issuer pursuant to an effective registration statement under the Securities Act occurred on or before December 8, 2011. The Company is exempt from certain regulatory and reporting requirements under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The JOBS Act facilitates the IPO process for emerging growth companies by exempting them from: Section 14A(a) and (b) of the Exchange Act implemented by Section 951 of the Dodd-Frank Act, which requires companies to hold shareholder advisory votes on executive compensation and golden parachute compensation; Section 14(i) of the Exchange Act, which will require companies to disclose the relationship between executive compensation actually paid and the financial performance of the company; Section 953(b)(1) of the Dodd-Frank Act, which will require companies to disclose the ratio between the annual total compensation of the chief executive officer and the median on the annual total compensation of all employees of the respective company; The requirement to provide certain other executive compensation disclosure under Item 402 of Regulation S-K, of which an emerging growth company will be required to comply only with the more limited provisions of Item 402 applicable to smaller reporting companies. An emerging growth company will not be required to provide an auditor's attestation report on internal financial reporting controls under Section 404(b) of the Sarbanes-Oxley Act of 2002; An emerging growth company will not have to comply with any new or revised financial accounting standards not applicable to private companies; and An emerging growth company will not have to comply with any rules that the Public Company Accounting Oversight Board might adopt requiring audit firm rotation or auditor discussion and analysis of the issuer's financial statements. Under the JOBS Act, emerging growth companies are subject to scaled financial disclosure requirements. Pursuant to these scaled requirements, emerging growth companies may: (i) provide only two rather than three years of audited financial statements in their IPO Registration Statement; (ii) provide selected financial data only for periods no earlier than those included in the IPO Registration Statement in all SEC filings, rather than the five years of selected financial date normally required; (iii) delay compliance with new or revised accounting standards until they are made applicable to private companies; and (iv) be exempted from compliance with Section 404(b) of the Sarbanes-Oxley Act, which requires companies to receive an outside auditor's attestation regarding the issuer's internal controls. In addition, during the IPO offering process, emerging growth companies are exempt from: (i) restrictions on analyst research prior to and immediately after the IPO, even from an investment bank that is underwriting the IPO; (ii) certain restrictions on communications to institutional investors before filing the IPO registration statement; and (iii) the requirement initially to publicly file IPO Registration Statements. Emerging growth companies can confidentially file draft Registration Statements and any amendments with the SEC. Public filings of the draft documents must be made at least 21 days prior to commencement of the IPO "road show." Trading Market There has been no public market for our common stock and there can be no assurance that an active trading market for our common stock will develop. As a result, this could adversely affect our shareholders' ability to sell our common stock in short time periods, or possibly at all. In the event an active trading market does develop in the future, our common stock is likely to experience significant price and volume fluctuations that could adversely affect the market price of our common stock without regard to our operating performance. In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets could cause the price of our common stock to fluctuate substantially. Substantial fluctuations in our stock price could significantly reduce the price of our stock. See RISK FACTORS and DESCRIPTION OF SECURITIES. The Offering The maximum number of Shares that can be sold pursuant to the terms of this offering is 5,000,000. The offering will terminate twenty-four (24) months from the date of this prospectus unless earlier fully subscribed or terminated by the Company. The Company is offering up to 5,000,000 shares offered at a price of $3.00 per share. There is no minimum number of shares that must be sold but the Company will use its best efforts to sell the securities offered. The Company will retain the proceeds from the sale of any of the offered shares. Common stock outstanding before the offering 15,000,000(1) Common stock for sale by Company 5,000,000 Common stock outstanding after the offering 20,000,000 Offering Price $3.00 per share Use of Proceeds: See Use of Proceeds on page 12
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001579252_jason_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001579252_jason_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights certain information appearing elsewhere in this prospectus. For a more complete understanding of this offering, you should read the entire prospectus carefully, including the risk factors and the financial statements. Unless the context indicates otherwise, the terms Jason, the Company, we, us and our refer to Jason Industries, Inc., a Delaware corporation and its subsidiaries. Background We were originally formed in May 2013 as a blank check company under the name Quinpario Acquisition Corp. ( QPAC ) for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving QPAC and one or more businesses. Until the consummation of the Business Combination (as defined below), QPAC s securities were traded on The NASDAQ Stock Market ( Nasdaq ) under the ticker symbols QPAC, QPACU and QPACW. On June 30, 2014, we completed our initial business combination (the Business Combination ) with Jason Incorporated pursuant to a stock purchase agreement dated as of March 16, 2014 (the Purchase Agreement ) that provided for the acquisition of all of the capital stock of Jason Partners Holdings Inc., the indirect parent company of Jason Incorporated, by JPHI from Jason Partners Holdings LLC ( Seller ) and certain members of Seller. In connection with the Business Combination, we entered into new senior secured credit facilities with a syndicate of lenders led by Deutsche Bank AG New York Branch, as administrative agent, in the aggregate amount of approximately $460.0 million, which was primarily used to refinance Jason Incorporated s existing indebtedness, pay transaction fees and expenses and pay a portion of the purchase price under the Purchase Agreement. The purchase price under the Purchase Agreement was also funded with cash held in our trust account, the contribution of Jason Partners Holdings Inc. common stock to JPHI by certain members of Seller and certain directors and management of Jason, including each of our named executive officers (collectively, the Rollover Participants ) in exchange for JPHI stock, and the proceeds from the sale of Series A Convertible Preferred Stock in a private placement that closed simultaneously with the Business Combination, which we refer to as the PIPE Investment. Following the Business Combination, Jason Incorporated became an indirect majority-owned subsidiary of ours and our only significant asset, with the Rollover Participants indirectly owning approximately 18.2% of Jason Incorporated and the Company indirectly owning approximately 81.8% of Jason Incorporated. Upon the closing of the Business Combination, we increased the size of our board of directors from six to nine directors and Jason Incorporated s executive officers became our executive officers. We also changed our name from Quinpario Acquisition Corp. to Jason Industries, Inc. and continued the listing of our Common Stock and Warrants on Nasdaq under the symbols JASN and JASNW, respectively, effective July 1, 2014. Table of Contents The information contained in this prospectus is not complete and may be changed. No securities may be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these shares, and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion, dated September 2, 2014 Preliminary Prospectus JASON INDUSTRIES, INC. 13,993,773 Shares of Common Stock Issuable upon Exercise of Outstanding Warrants 14,422,056 Shares of Common Stock 1,150,000 Warrants to Purchase Common Stock 66,868 Shares of 8.0% Series A Convertible Perpetual Preferred Stock This prospectus relates to the issuance by us of (i) 12,843,773 shares of our common stock, par value $0.0001 per share (the Common Stock ) upon the exercise of warrants which were originally issued as part of units in our initial public offering (the Public Warrants ), and (ii) 1,150,000 shares of Common Stock upon the exercise of warrants, which were originally issued as part of units in a private placement that closed simultaneously with the consummation of our initial public offering (the IPO Placement Warrants and, together with the Public Warrants, the Warrants ). Each Warrant entitles the holder to purchase one share of our Common Stock at an exercise price of $12.00 per share. We will receive the proceeds from the exercise of the Warrants, but not from the sale of the underlying Common Stock. This prospectus also relates to the resale of 14,422,056 shares of our Common Stock, 1,150,000 IPO Placement Warrants, and 66,868 shares of our 8.0% Series A Convertible Perpetual Preferred Stock, par value $0.0001 per share (the Series A Convertible Preferred Stock ), by the selling security holders named in this prospectus or their permitted transferees. The shares of Common Stock being offered by the selling security holders consists of (i) 3,485,623 shares of Common Stock that can be issued from time to time to the holders of an equivalent number of shares of common stock (the JPHI stock ) of our subsidiary, JPHI Holdings Inc., a Delaware corporation ( JPHI ), upon the exchange by such holders of JPHI stock for shares of our Common Stock (the Rollover Shares ), (ii) 6,133,333 shares of Common Stock issued prior to our initial public offering (the founder shares ), (iii) 1,150,000 shares of Common Stock sold as part of units issued in a private placement that closed simultaneously with the consummation of our initial public offering (the IPO Placement Shares ), and (iv) 3,653,100 shares of Common Stock that can be issued upon conversion of our Series A Convertible Preferred Stock, which Series A Convertible Preferred Stock was issued in a private placement that closed simultaneously with our initial business combination (the PIPE Investment ). The selling security holders may offer, sell or distribute all or a portion of their securities publicly or through private transactions at prevailing market prices or at negotiated prices. We will not receive any of the proceeds from the sale of the securities owned by the selling security holders. We will bear all costs, expenses and fees in connection with the registration of these securities, including with regard to compliance with state securities or blue sky laws. The selling security holders will bear all commissions and discounts, if any, attributable to their sale of securities. See Plan of Distribution beginning on page 148 of this prospectus. Our Common Stock and Warrants are quoted on The NASDAQ Stock Market under the symbols JASN, and JASNW. There is no established trading market for the Series A Convertible Preferred Stock. On August 29, 2014, the closing price of our Common Stock and Warrants was $10.41 and $1.40, respectively. As of August 31, 2014, we had 21,990,666 shares of Common Stock, 13,993,773 Warrants and 45,000 shares of Series A Convertible Preferred Stock issued and outstanding. Our principal executive offices are located at 411 East Wisconsin Avenue, Suite 2100, Milwaukee, Wisconsin 53202, and our telephone number is (414) 277-9300. INVESTING IN THESE SECURITIES INVOLVES CERTAIN RISKS. SEE RISK FACTORS ON PAGE 8. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Our securities are not being offered in any jurisdiction where the offer is not permitted under applicable local laws. The date of this prospectus is , 2014 Table of Contents Organizational Chart Presentation of Financial and Operating Data The Business Combination will be accounted for using the acquisition method of accounting under the provisions of Accounting Standards Codification 805, Business Combinations . Accordingly, we are treated as the legal and accounting acquirer and Jason Partners Holdings Inc. is treated as the legal and accounting acquiree. However, Jason Partners Holdings Inc. is considered to be our accounting predecessor, and therefore unless otherwise indicated, the financial information and operating data presented in this prospectus is that of Jason Partners Holdings Inc. The historical financial statements of Quinpario Acquisition Corp. (a development stage company) for the year ended December 31, 2013 (audited) are not included in this registration statement, but were included in the definitive proxy statement of Quinpario Acquisition Corp. filed with the Securities and Exchange Commission on June 16, 2014. The financial statements of such entity for the interim period ended June 27, 2014 (unaudited) were included in our Form 10-Q filed with Securities and Exchange Commission on August 11, 2014. Our Company We are a global industrial manufacturing company operating in the following industry sectors: agricultural, construction and industrial manufacturing. We operate in these sectors through four businesses: finishing, seating, acoustics and components. Jason Incorporated was founded in 1985 and today provides critical components and manufacturing solutions to customers across a wide range of end markets, industries and geographies through a global network of 33 manufacturing facilities and 16 sales offices, warehouses and joint venture facilities throughout the United States and 14 foreign countries. We are led by a corporate and business management team with an average of 25 years of experience and have embedded relationships with long standing customers, superior scale and resources and industry leading capability to design and manufacture specialized products on which our customers rely. Our goal is to focus on markets with sustainable growth characteristics and where we believe we are, or have the opportunity to become, the industry leader. Our finishing business focuses on the production of industrial brushes, buffing wheels and buffing compounds that are used in a broad range of industrial and Table of Contents infrastructure applications. While our finishing business competes with numerous domestic and international companies across numerous product lines, the market is highly fragmented with most participants having single or limited product lines and serving specific geographic markets. We believe that resurgence in demand from the manufacturing, industrial and energy markets is driving demand for finishing products. In the long-term, the finishing market is closely tied to overall growth in industrial production, which we believe has fundamental and significant long-term growth potential. Our seating business supplies seating solutions to equipment manufacturers in the motorcycle, lawn and turf care, industrial, agricultural, construction and power sports end markets and is the sole supplier of original equipment manufacturer ( OEM ) seating to a major U.S.-based manufacturer of heavy motorcycles. The market for seating products is dominated by several large domestic and international participants who are often awarded contracts as the sole supplier for a particular product. Production and demand for motorcycles, lawn and garden equipment and construction equipment has rebounded since the recession and we expect activity to continue to improve in these sectors. The acoustics business manufactures engineered non-woven, fiber-based acoustical products for the North American auto industry. The market for automotive acoustical products is dominated by several large domestic and international participants who are often awarded contracts as the sole supplier for a particular automotive platform based on innovative styling, price or acoustical performance of their products. The components business is a diversified manufacturer of stamped, formed, expanded and perforated metal components and subassemblies for rail and filtration applications, outdoor power equipment, small gas engines and smart utility meters. Demand in the components market is influenced by the broader industrial manufacturing market, which we believe has fundamental and significant long-term growth potential, as well as trends in the perforated and expanded metal, smart meter, rail and outdoor power equipment industries. The market for component products is highly fragmented with most participants having single or limited product lines, serving specific geographic markets or providing niche capabilities applicable to a limited customer base. We employ approximately 4,000 employees and manufacture products in 33 locations around the world. For the six months ended June 27, 2014 and year ended December 31, 2013, we generated net sales of $377.2 million and $680.8 million, respectively, income from operations of $20.8 million and $53.7 million, respectively, and adjusted EBITDA of $45.9 million and $79.8 million, respectively. Additional Information Our principal executive offices are located at 411 East Wisconsin Avenue, Suite 2100, Milwaukee, Wisconsin 53202, and our telephone number is (414) 277-9300. Our website is www.jasoninc.com. Recent Developments On May 6, 2014, we commenced a tender offer to purchase up to 9,200,000 of the Public Warrants at a purchase price of $0.75 per Warrant, which was subsequently increased to $1.00 per warrant on June 18, 2014 and $1.50 per Warrant on July 7, 2014, subject to certain conditions, including the consummation of the Business Combination. The Warrant Tender Offer expired on July 18, 2014 and a total of 4,406,277 warrants were validly tendered and not properly withdrawn for a total purchase price of approximately $6,609,000. Table of Contents The Offering We are registering (i) the offer and sale by us of 13,993,773 shares of Common Stock underlying Warrants previously issued by the Company as Public Warrants and IPO Placement Warrants and (ii) the resale of 14,422,056 shares of Common Stock, 1,150,000 IPO Placement Warrants, and 66,868 shares of Series A Convertible Preferred Stock by the selling security holders named in this prospectus or their permitted transferees. Issuance of Common Stock Underlying Warrants Shares to be issued upon exercise of Warrants 13,993,773 shares of Common Stock underlying our Warrants. Shares outstanding prior to exercise of Warrants 21,990,666 shares of Common Stock as of August 31, 2014. Shares to be outstanding assuming exercise of all Warrants 35,984,439 shares of Common Stock. Terms of Warrants Each Warrant entitles the holder to purchase one share of our Common Stock at an exercise price of $12.00 per share, subject to adjustment, at any time commencing on August 14, 2014, which is 12 months from the consummation of our initial public offering ( IPO ). The Warrants will expire at 5:00 p.m., New York time, on June 30, 2019 (which is five years after the completion of our initial business combination) or earlier upon redemption or liquidation. Use of Proceeds We expect to receive $167,925,276 in net proceeds assuming the exercise of all of our Warrants at the exercise price of $12.00 per share. We intend to use these net proceeds for working capital and general corporate purposes. Trading market and ticker symbol Our Warrants are quoted on Nasdaq under the symbol JASNW. Resale of Common Stock, IPO Placement Warrants and Series A Convertible Preferred Stock by Selling Security Holders Common Stock offered by the selling security holders We are registering 14,422,056 shares of Common Stock to be offered by the selling security holders named herein, which includes 3,485,623 Rollover Shares, 6,133,333 founder shares, 1,150,000 IPO Placement Shares and 3,653,100 shares of Common Stock that can be issued upon conversion of our Series A Convertible Preferred Stock. IPO Placement Warrants offered by the selling security holders We are registering 1,150,000 IPO Placement Warrants to be offered by the selling security holder named herein. Each IPO Placement Warrant entitles the holder to purchase one share of our Common Stock at an exercise price of $12.00 per share, subject to adjustment, Table of Contents at any time commencing on August 14, 2014. The IPO Placement Warrants will expire at 5:00 p.m., New York time, on June 30, 2019 or earlier upon redemption or liquidation. Series A Convertible Preferred Stock offered by the selling security holders We are registering 66,868 shares of Series A Convertible Preferred Stock to be offered by the selling security holders, including 21,868 shares of Series A Convertible Preferred Stock potentially issuable over the next five years as dividends. Conversion of Series A Convertible Preferred Stock Each share of Series A Convertible Preferred Stock is convertible, at the holder s option at any time, initially into 81.18 shares of our Common Stock (which is equivalent to an initial conversion price of approximately $12.32 per share), subject to specified adjustments as set forth in the Certificate of Designations, Preferences, Rights and Limitations of the Series A Convertible Preferred Stock (the Certificate of Designations ). In addition, the Company has the right, at its option, to cause all outstanding shares of the Series A Convertible Preferred Stock to be automatically converted into shares of Common Stock under certain circumstances and, if the Company undergoes certain fundamental changes, the Series A Convertible Preferred Stock will automatically be converted into Common Stock on the effective date of such fundamental change, in each case, as more fully described in Description of Capital Stock Series A Convertible Preferred Stock. Dividends on Series A Convertible Preferred Stock Holders of the Series A Convertible Preferred Stock are entitled to receive, when, as and if declared by the Company s board of directors, cumulative dividends at the rate of 8.0% per annum (the dividend rate) on the $1,000 liquidation preference per share of the Series A Convertible Preferred Stock, payable quarterly in arrears on each dividend payment date. Dividends are paid in cash or, at the Company s option, in additional shares of Series A Convertible Preferred Stock or a combination thereof. For more information, please read Description of Capital Stock Series A Convertible Preferred Stock. Terms of the offering The selling security holders will determine when and how they will dispose of the Common Stock, IPO Placement Warrants and Series A Convertible Preferred Stock registered under this prospectus for resale. Securities outstanding prior to this offering 21,990,666 shares of our Common Stock and 45,000 shares of our Series A Convertible Preferred Stock are issued and outstanding as of Table of Contents July 31, 2014. In addition, as of July 31, 2014, 13,993,773 shares of Common Stock are issuable upon exercise of 13,993,773 outstanding Warrants. Securities outstanding after this offering 43,123,162 shares of our Common Stock, which assumes the exercise of all Warrants, exchange of all JPHI stock into Common Stock, and the conversion of all shares of Series A Convertible Preferred Stock. The number of shares of Common Stock outstanding after this offering excludes the 3,473,435 shares of Common Stock available for future issuance under the Jason Industries, Inc. 2014 Omnibus Incentive Plan. Use of Proceeds We will not receive any of the proceeds from the sale of shares of Common Stock, IPO Placement Warrants or Series A Convertible Preferred Stock by the selling security holders. However, we will receive proceeds from the exercise of IPO Placement Warrants if they are exercised by the selling security holder. We intend to use any proceeds for working capital and general corporate purposes. Trading market and ticker symbol Our Common Stock and Warrants are quoted on Nasdaq under the symbols JASN, and JASNW, respectively. There has been no market for our Series A Convertible Preferred Stock and a public market may not develop, or, if any market does develop, it may not be sustained. Our Series A Convertible Preferred Stock is not listed on any exchange or quoted on the OTC Bulletin Board. For additional information concerning the offering, see Plan of Distribution beginning on page 148.
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+PROSPECTUS SUMMARY
+ 
+
+ To understand this offering fully, you should read the entire prospectus carefully, including the risk factors beginning on page 7.
+ 
+
+ General
+ DMC Beverage Corp. ( DMC ) was incorporated under the laws of the state of Delaware on January 11, 2002.
+ 
+
+ Operations
+ DMC is a beverage corporation. We plan to distribute our 100% blended juice beverage product line called CoolJuice .
+ 
+
+ Common Shares 
+ Outstanding prior 
+ to the Offering 
+ 13,642,367
+ 
+
+ Common Shares 
+ being sold in 
+ this offering 
+ 8,000,000
+ 
+
+ Terms of Primary
+ Offering 
+ This is a self-underwritten public offering with no minimum purchase requirement. Common shares will be offered on a best efforts basis and we do not intend to use an underwriter for this offering. We do not have an arrangement to place the proceeds from this offering in an escrow, trust, or similar account. Any funds raised from the offering will be immediately available to us for our immediate use.
+ 
+
+ Termination of the 
+ Offering 
+ The offering will commence on the effective date of this prospectus and will terminate on or before December 31, 2014. In management s sole discretion, we may terminate the primary offering before all of the common shares are sold. 
+ 
+
+ 
+
+ 5
+ 
+
+ 
+
+ 
+
+ 
+
+ Market for our common 
+ stock 
+ Our common stock is not quoted on a market or securities exchange. We cannot provide any assurance that an active market in our common stock will develop. We intend to quote our common shares on a market or securities exchange.
+ 
+
+ Going Concern Opinion
+ Our auditor has issued a going concern opinion. We have suffered recurring losses from operations and have a net capital deficiency, which raises substantial doubt about our ability to continue as a going concern. 
+ 
+
+ Legal proceedings
+ On December 17, 2012, the registrant was subject to a court judgment from the Circuit Court of the Tenth Judicial Circuit In and For Polk County, Florida requiring it to repay $70,217.94 in debt to Richert Funding, LLC, a Florida limited liability company. This amount is due and outstanding.
+ 
+
+ There are balances due to C.H. Robinson Worldwide, Inc., Echo Global Logistics, and Golden 100/Jouge Inc. of $154,390, $64,699, and $96,147 respectively. These entities have initiated legal proceedings. There is also a note payable to a shareholder outstanding. The principle balance outstanding is $111,000 with $4,240 in accrued interest as of September 30, 2013. This note is secured by 136,365 common shares of the registrant. The shareholder has notified the registrant of the loans default, but has not yet begun the litigation to encumber these shares. The current liability has been recorded in full, but no estimation of the final outcome for accrued interest, legal costs or other judgment costs resulting from the legal proceedings has been evaluated or accrued.
+ 
+
+ Use of proceeds
+ We will use the proceeds of this offering to add personnel to expand our business and add personnel as required. Should we be unable to raise at least $250,000, we would give priority to allocating capital to complete everything necessary to be ready to meet our SEC reporting requirements. Any remaining capital would be used to fund working capital needs, including the employment of additional personnel. 
+ 
+
+ 6
+ 
+
+ 
+
+ 
+
+ 
+
+ RISK FACTORS
+ 
+
+ GENERAL
+ 
+
+ The purchase of the securities offered by the registrant involves significant risks and other important considerations that may adversely affect the investor and his or her purchase of our shares. Therefore, prospective purchasers should consider the following factors, among others, before making a decision to purchase the shares offered by the registrant. The material set forth below is intended merely to summarize and highlight certain factors relating to the purchase of the shares and not intended to cover full, supersede, or replace the other portions of this offering, which may discuss these and other factors. This offering of shares under this program is directed only to those persons who are in the position to accept the risks discussed herein.
+ 
+
+ SPECIFIC RISKS
+ 
+
+ 1. We are a new business operation and thus cannot guarantee that we will ever become profitable.
+ 
+
+ We are a relatively new business in that minimal sales of our products have been made to date. There is no guarantee that we will be able to complete the vision of our business plan and expand sales and distribution to the extent that the registrant becomes profitable and failure to complete our goals will adversely affect the value of the securities offered by the registrant as well as the investor s investment. Any investment in the registrant should be considered a high risk investment because the investor will be placing funds at risk in an unseasoned early stage company with unforeseen costs, expenses, competition and other problems to which such companies are often subject.
+ 
+
+ 2. We have limited financial resources, which may limit our ability to operate our business plan.
+ 
+
+ We have limited working capital, yet must sustain all of the development and overhead costs of current operations. Our operations are recently acquired, have minimal working capital and have been relying on shareholder loans and the sale of our securities to fund operations. We may not be able to raise sufficient capital to meet our ongoing needs or fund our business plan, which could result in the termination of the business and the loss of your investment.
+ 
+
+ 
+
+ 7
+ 
+
+ 
+
+ 
+
+ 
+
+ 3. We are entering into a highly competitive market. Our present financial condition may limit our ability to successfully pursue our business.
+ 
+
+ There are numerous entities in the beverage space, many of which are larger, more experienced, and better funded with working capital than the registrant. The business is highly competitive due to the large field of competitors. We are at a significant disadvantage due to our size, financial strength and short history of operation. Our present financial condition may limit our ability to successfully pursue our business.
+ 
+
+ Our operating results may fluctuate in the future due to several factors, many of which will be out of our control, such as:
+ - The magnitude of our competition.
+ - Pricing competition.
+ - Potential liability associated with consumer food products.
+ - The amount and timing of costs relating to expansion of our operation.
+ 
+
+ Due to these factors, or unforeseen factors in some future time, our operating results may not meet minimum requirements to continue our existence.
+ 
+
+ 4. There is currently no market for our shares.
+ 
+
+ There is currently no market for our shares. We are attempting to create a market, but until a market develops, it may be difficult to sell any shares purchased during this offering. It is possible that a market will never develop for our shares.
+ 
+
+ 5. Volatility in the price or availability of the inputs the registrant depends on, including raw materials, packaging, energy and labor, may adversely impact profitability.
+ 
+
+ The registrant s future profitability could be adversely impacted by changes in the cost or availability of raw materials and packaging. The registrant does not currently have any long-term supply agreements with suppliers, and as such, increases in the costs of raw materials and packaging, including but not limited to cost increases due to the tightening of supply, could adversely affect profitability in the future. Future sales price increases of the registrant s products, such as those to offset increased ingredient costs, may reduce overall sales volume, which could reduce total revenues and operating profit.
+ 
+
+ 
+
+ 8
+ 
+
+ 
+
+ 
+
+ 
+
+ 6. The registrant operates in a highly competitive food & beverage industry.
+ 
+
+ Price competition and industry consolidation could adversely impact the registrant s results of operations and financial condition. The sales of the registrant s products are subject to significant competition primarily through discounting and other price cutting techniques by competitors, many of whom are significantly larger and have greater resources than the registrant. In addition, there is a continuing consolidation by the major companies in the food & beverage industry, which could increase competition. Significant competition increases the possibility that the registrant could lose one or more major customers, lose existing product offerings at customer locations, lose market share and/or shelf space, increase expenditures or reduce selling prices, all of which could have an adverse impact on the registrant s business or results of operations.
+ 
+
+ 7. If the registrant s products become adulterated, misbranded or mislabeled, it might need to recall those items and may experience product liability claims if consumers are injured or become sick.
+ 
+
+ Product recalls or safety concerns could adversely impact the registrant s results of operations and market share. The registrant may be required to recall certain of its products should they be mislabeled, contaminated or damaged. The registrant also may become involved in lawsuits and legal proceedings if it is alleged that the consumption of any of its products causes injury or illness. A product recall or an adverse result in any such litigation could have a material adverse effect on the registrant s operating and financial results. The registrant may also lose customer confidence for its entire brand portfolio.
+ 
+
+ 7. Disruption of the registrant s supply chain could have an adverse impact on its business, results of operations and financial condition.
+ 
+
+ The registrant s ability to manufacture, distribute and sell products is critical to its success. Damage or disruption to the registrant s manufacturing or distribution capabilities or the supply and delivery of key inputs, such as raw materials, packaging, labor, and energy, could impair its ability to conduct business. We anticipate that our current business relationships will be adequate once our funding goals have been achieved. However, should our current lack of funding damage our relationship with our current providers, we will have to look for new sources of ingredients and packaging.
+ 
+
+ 
+
+ 9
+ 
+
+ 
+
+ 
+
+ 
+
+ 8. Demand for the registrant s products may be adversely affected by changes in consumer preferences and tastes or if the registrant is unable to innovate or market its products effectively.
+ 
+
+ The registrant is a consumer products company operating in highly competitive markets and relies on continued demand for its products. To generate revenues and profits, the registrant must sell products that appeal to its customers and consumers. Any significant changes in consumer preferences or any inability on the registrant s part to anticipate or react to such changes could result in reduced demand for its products and erosion of its competitive and financial position. The registrant s success depends on the ability to respond to consumer trends, including concerns of consumers regarding health and wellness, obesity, product attributes and ingredients. In addition, changes in consumer demographics could result in reduced demand for the registrant s products. Consumer preferences may shift due to a variety of factors, including changes in social trends or negative publicity resulting from regulatory action or litigation against companies in the beverage industry. Any of these changes may reduce consumers willingness to purchase the registrant s products.
+ 
+
+ 9. The registrant s continued success is dependent on product innovation, including maintaining a robust pipeline of new products, and the effectiveness of advertising campaigns, marketing programs and product packaging. 
+ 
+
+ While the registrant intends to devote significant resources to meet this goal, there can be no assurance as to the continued ability to develop and launch successful new products or variants of existing products, or to effectively execute advertising campaigns and marketing programs. In addition, both the launch and ongoing success of new products and advertising campaigns are inherently uncertain, especially as to their appeal to consumers. Further, failure to successfully launch new products could decrease demand for existing products by negatively affecting consumer perception of existing brands, as well as result in inventory write-offs and other costs.
+ 
+
+ 10. The registrant s distribution network relies significantly on independent operators, and such reliance could affect its ability to efficiently and profitably distribute and market products, maintain existing markets and expand business into other geographic markets.
+ 
+
+ The registrant s ability to maintain a distribution network and attract additional independent operators and distributors depends on a number of factors, many of which are outside of the registrant s control. Some of these factors include: (i) the level of 
+ 
+
+ 10
+ 
+
+ 
+
+ 
+
+ 
+
+ demand for the brands and products, which are available in a particular distribution area; (ii) the ability to price products at levels competitive with those offered by other competing producers; and (iii) the ability to deliver products in the quantity and at the time ordered by independent operators and customers. There can be no assurance that the registrant will be able to meet all or any of these factors in any of the current or prospective geographic areas of distribution. To the extent that any of these factors have a material adverse effect on the relationships with independent operators in a particular geographic area and, thus, limit the ability to maintain and expand the sales market, revenues and financial results may be adversely impacted. We currently use several different suppliers for ingredients, packaging, and shipping. Any one of these suppliers may come short, and any failure to deliver will hurt the rest of our operations. 
+ 
+
+ 11. Identifying new independent operators or distributors can be time-consuming and any resulting delay may be disruptive and costly to the business. 
+ 
+
+ There is no assurance that the registrant will be able to maintain current distribution relationships or establish and maintain successful relationships with independent operators in new geographic distribution areas. We currently use several different suppliers for ingredients, packaging, and shipping. There is the possibility that the registrant will have to incur significant expenses to attract and maintain additional independent operators in one or more geographic distribution areas in order to profitably expand geographic markets. The occurrence of any of these factors could result in a significant decrease in sales volume of the registrant s branded products and the products which it distributes for others and materially harm the registrant s financial condition and results of operations. 
+ 
+
+ 12. The registrant s continued success depends on the protection of its trademarks and other proprietary intellectual property rights.
+ 
+
+ The registrant maintains patents, trademarks and other intellectual property rights, which are important to its success and competitive position, and any inability to enforce trademark and other proprietary intellectual property rights could harm the business. The registrant s efforts to establish and protect trademarks and other proprietary intellectual property rights may not be adequate to prevent imitation of its products by others or to prevent others from seeking to block sales of its products.
+ 
+
+ 
+
+ 11
+ 
+
+ 
+
+ 
+
+ 
+
+ 13. New regulations or legislation could adversely affect our business.
+ 
+
+ Food production and marketing are highly regulated by a variety of federal, state and other governmental agencies. New or increased government regulation of the food industry, including but not limited to areas related to food safety, chemical composition, production processes, traceability, product quality, packaging, labeling, promotions, marketing, and advertising, product recalls, records, storage and distribution could adversely impact the registrant s results of operations by increasing production costs or restricting the registrant s methods of operation and distribution.
+ 
+
+ 14. Difficulties managing growth could adversely affect the registrant s business, operating results and financial condition.
+ 
+
+ If the registrant achieves growth in its operations in the next few years, such growth could place a strain on our management, and its administrative, operational and financial infrastructure. The registrant s ability to manage its operations and growth requires the continued improvement of operational, financial and management controls, reporting systems and procedures. In addition, we may need to hire additional management to manage its future operations. If we are unable to manage its growth effectively or are unable to attract additional highly qualified personnel, our business, operating results and financial condition may be materially adversely affected.
+ 
+
+ 15. We have not yet adopted of certain corporate governance measures. As a result, our stockholders have limited protections against interested director transactions, conflicts of interest and similar matters. 
+ 
+
+ The Sarbanes-Oxley Act of 2002, as well as rule changes proposed and enacted by the SEC, the New York and American Stock Exchanges and the Nasdaq Stock Market, as a result of Sarbanes-Oxley, require the implementation of various measures relating to corporate governance. These measures required by Sarbanes-Oxley are designed to enhance the integrity of corporate management and the securities markets and apply to securities which are listed on those exchanges or the Nasdaq Stock Market. We are not presently required to comply with many of the corporate governance provisions and because we chose to avoid incurring the substantial additional costs associated with such compliance any sooner than necessary, we have not yet adopted these measures. 
+ 
+
+ Because all our directors are non-independent, we do not currently have independent audit or compensation committees. As a result, the directors have the ability, among other things, to determine their own level of compensation. Until we comply with such 
+ 
+
+ 12
+ 
+
+ 
+
+ 
+
+ 
+
+ corporate governance measures, regardless of whether such compliance is required, the absence of such standards of corporate governance may leave our stockholders without protections against interested director transactions, conflicts of interest and similar matters and investors may be reluctant to provide us with funds necessary to expand our operations. 
+ 
+
+ 16. If we fail to develop or maintain an effective system of internal controls, we may not be able to report our financial results timely and accurately or prevent fraud, which would likely have a negative impact on the market price of our common units. 
+ 
+
+ Upon the completion of this offering, we will become subject to the public reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, including the rules thereunder that will require our management to certify financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness of our internal control over financial reporting. Effective internal controls are necessary for us to provide reliable and timely financial reports, prevent fraud and to operate successfully as a publicly traded partnership. We prepare our consolidated financial statements in accordance with GAAP, but our internal accounting controls may not meet all standards applicable to companies with publicly traded securities. Our efforts to develop and maintain our internal controls may not be successful and we may be unable to maintain effective controls over our financial processes and reporting in the future or to comply with our obligations under Section 404 of the Sarbanes-Oxley Act of 2002, or Sarbanes-Oxley.
+ 
+
+ Given the difficulties inherent in the design and operation of internal controls over financial reporting, in addition to our limited accounting personnel and management resources, we can provide no assurance as to our, or our independent registered public accounting firm's, future conclusions about the effectiveness of our internal controls, and we may incur significant costs in our efforts to comply with Section 404. Any failure to implement and maintain effective internal controls over financial reporting will subject us to regulatory scrutiny and a loss of confidence in our reported financial information, which could have an adverse effect on our business and would likely have a negative effect on the trading price of our common units. 
+ 
+
+ Although we will be required to disclose changes made in our internal control and procedures on a quarterly basis, we will not be required to comply with Item 308(a) of Regulation S-K requiring management s annual report on internal control over financial reporting until our Form 10-K for the fiscal year ended December 31, 2013.
+ 
+
+ 
+
+ 13
+ 
+
+ 
+
+ 
+
+ 
+
+ 17. The costs to meet our reporting and other requirements as a public company subject to the Exchange Act of 1934 will be substantial and may result in us having insufficient funds to expand our business or even to meet routine business obligations. 
+ 
+
+ If we become a public entity, subject to the reporting requirements of the Exchange Act of 1934, we will incur ongoing expenses associated with professional fees for accounting, legal and a host of other expenses for annual reports. We estimate that these costs could range up to $35,000 per year for the next few years and will be higher if our business volume and activity increases but lower during the first year of being public because our overall business volume will be lower, and we will not yet be subject to the requirements of Section 404 of the Sarbanes-Oxley Act of 2002. As a result, we may not have sufficient funds to grow our operations. 
+ 
+
+ 18. We do not meet the requirements for our stock to be quoted on NASDAQ, American Stock Exchange or any other senior exchange and the tradability in our stock will be limited under the penny stock regulation.
+ 
+
+ The liquidity of our common stock is restricted as our common stock falls within the definition of a penny stock.
+ 
+
+ Under the rules of the Securities and Exchange Commission, if the price of the registrant's common stock on the OTC Bulletin Board is below $5.00 per share, the registrant's common stock will come within the definition of a "penny stock." As a result, the registrant common stock is subject to the "penny stock" rules and regulations. Broker-dealers who sell penny stocks to certain types of investors are required to comply with the Commission's regulations concerning the transfer of penny stock. These regulations require broker-dealers to:
+ 
+
+ - Make a suitability determination prior to selling penny stock to the purchaser;
+ - Receive the purchaser's written consent to the transaction; and
+ - Provide certain written disclosures to the purchaser.
+ These requirements may restrict the ability of broker/dealers to sell the registrant's common stock, and may affect the ability to resell the registrant's common stock.
+ 
+
+ 
+
+ 14
+ 
+
+ 
+
+ 
+
+ 
+
+ 19. Future sales by our stockholders could cause the stock price to decline and may affect your ability to liquidate your investment.
+ 
+
+ In the future, the registrant may issue equity and debt securities. Any sales of additional common shares may have a depressive effect upon the market price of the registrant s common stock causing the stock price to decline. 
+ 
+
+ 20. Our auditors have issued a going concern statement regarding our financial statements.
+ 
+
+ Our financial statements have been prepared assuming that we will continue as a going concern. We have suffered recurring losses from operations and have a net capital deficiency, which raises substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
+ 
+
+ 21. We have outstanding debt due, and proceedings have been initiated against us. Our operations may be effected by the payment of the judgments.
+ 
+
+ On December 17, 2012, we were subject to a court judgment requiring us to repay $70,217.94 in debt to Richert Funding, LLC, a Florida limited liability company. This amount is due and outstanding. There are balances due to C.H. Robinson Worldwide, Inc., Echo Global Logistics, and Golden 100/Jouge Inc. of $154,390, $64,699, and $96,147 respectively. These entities have initiated legal proceedings. There is also a note payable to a shareholder outstanding. The principle balance outstanding is $111,000 with $4,240 in accrued interest as of September 30, 2013. This note is secured by 136,365 common shares of the registrant. The shareholder has notified the registrant of the loan s default, but has not yet begun the litigation to encumber these shares. The current liability has been recorded in full, but no estimation of the final outcome for accrued interest, legal costs or other judgment costs resulting from the legal proceedings has been evaluated or accrued. We expect that part of the amounts received in this offering will have to be used to pay down some of this outstanding debt. So long as these debts remain outstanding, our operational costs will be increased.
+ 
+
+ 
+
+ 15
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001580608_santander_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001580608_santander_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..69b070908361b1d8693a20b00f671f1848d62e7f
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001580608_santander_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1 1 d768367ds1.htm FORM S-1 FORM S-1 Table of Contents As filed with the Securities and Exchange Commission on August 13, 2014 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 SANTANDER CONSUMER USA HOLDINGS INC. (Exact Name of Registrant as Specified in Its Charter) Delaware 6141 32-0414408 (State or other jurisdiction of corporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 1601 Elm St. Suite #800 Dallas, Texas 75201 (214) 634-1110 (Address, including zip code, and telephone number, including area code, of Registrant s principal executive offices) Jason Kulas President and Chief Financial Officer 1601 Elm St. Suite #800 Dallas, Texas 75201 (214) 634-1110 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Richard K. Kim, Esq. Benjamin M. Roth, Esq. Mark F. Veblen, Esq. Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 Telephone: (212) 403-1000 Facsimile: (212) 403-2000 Jeffrey D. Karpf, Esq. Cleary Gottlieb Steen & Hamilton LLP One Liberty Plaza New York, New York 10006 Telephone: (212) 225-2000 Facsimile: (212) 225-3999 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to Be Registered Amount to be Registered (1) Proposed Maximum Offering Price per Share (2) Proposed Maximum Aggregate Offering Price (2) Amount of Registration Fee (3) Common stock, par value $0.01 per share to be sold by the selling stockholder 14,178,779 $17.82 $252,665,841.78 $32,543.36 (1) The shares will be offered for resale by the selling stockholder pursuant to the shelf prospectus contained herein. (2) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(a) under the Securities Act of 1933, as amended. In accordance with Rule 457(c) under the Securities Act of 1933, as amended, the proposed maximum offering price per share shown is the average of the high and low prices of the common stock on August 12, 2014 as reported on the New York Stock Exchange. (3) Calculated at a rate of $128.80 per $1,000,000 of the proposed maximum aggregate offering price. The Registrant hereby amends this Registration Statement on such date as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents TABLE OF CONTENTS Page Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001581094_iloadapp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001581094_iloadapp_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..dfa9a2ec81a54217cde61768fd64ac9af467f407
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001581094_iloadapp_prospectus_summary.txt
@@ -0,0 +1,1002 @@
+Prospectus Summary—The Company—Implications of Being an Emerging Growth Company."
+
+ 
+
+ 
+
+DESCRIPTION OF BUSINESS
+
+ 
+
+Corporate History
+
+ 
+
+ILoadApp was incorporated in the State of Nevada
+on May 22, 2013, under the name ILoadApp. We consider ourselves to be a shell company. We also consider ourselves to be an emerging
+growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. (See
+"Implications of Being an , ' ': Emerging Growth Company " below in this Section. We
+are a development stage company. From our inception to date, we have generated no revenues, and our operations have been limited
+to organizational, start-up, capital formation activities, designing an educational app, reserving a corporate website (www.Iloadapp.com)
+and establishing administrative offices. Our plan of operation is to design and sell mobile educational
+applications for smart phones and other mobile platforms such as tablets.
+
+ 
+
+Summary Overview
+
+ 
+
+ILoadApps is an emerging growth company. We
+were incorporated in the State of Nevada on May 22, 2013 under the corporate name: ILoadApp. We plan to develop, design, market
+and sell mobile apps for smart phones and other mobile platforms such as tablets.
+
+ 
+
+We have no revenues, we have achieved losses
+since inception, we have limited operations, we have been issued a going concern opinion by our auditors and currently rely upon
+the sale of our securities to fund operations.
+
+ 
+
+ 
+
+40
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Our Business
+
+ 
+
+We are engaged in the business of designing
+and selling mobile applications for smart phones and other mobile platforms such as tablets. Management is currently working on
+the development of an app for education/early child development, to teach the English alphabet utilizing
+visual aides in a game setting environment. There are no assurances that that we can successfully design an app that will be marketable
+or ever have potential users.
+
+ 
+
+A mobile application ("mobile app")
+is a software application designed to run on smartphones, tablet computers and other mobile devices. They are usually downloaded
+from the platform to a target device, such as an iPhone, BlackBerry, Android phone or Windows Phone, but sometimes they can be
+downloaded to laptops or desktops. For apps with a price, generally a percentage, 20-30%, goes to the distribution provider (such
+as iTunes), and the rest goes to the producer of the app.
+
+ 
+
+Mobile apps were originally offered for general
+productivity and information retrieval, including email, calendar, contacts, and stock market and weather information. However,
+public demand and the availability of developer tools drove expansion into other categories, such as mobile games, factory automation,
+GPS and location-based services, banking, order-tracking, and ticket purchases. The popularity of mobile applications has continued
+to rise, as their usage has become increasingly prevalent across mobile phone users.
+
+ 
+
+Researchers found that usage of mobile applications
+strongly correlates with user context and depends on user's location and time of the day.
+
+ 
+
+Development of Apps
+
+ 
+
+Developing application software for mobile
+devices requires considering the constrains of these devices. Mobile devices run on battery and have less powerful processors than
+personal computers. Developers also have to consider a lengthy array of screen sizes, hardware specifications and configurations
+because of intense competition in mobile software and changes within each of the platforms.
+
+ 
+
+Management views the steps to create an App
+include: 1) Researching the idea as to the type of app to design and develop; 2) Understanding who will be the users of the app,
+so the app can be designed to meet the users needs; 3) collecting the tools, resources and information required to build the app;
+4) Designing the app itself, where it functions and features are operational; 5) Code the app, where it cannot be copied or mass
+produced by a third party; 6) Ask friends to test the app, to determine if it has any glitches.
+
+ 
+
+During the development process, we have completed our research and
+determined we want to develop and app to teach the English alphabet utilizing visual aides in a game setting environment. We plan
+to market this app towards children and adults in Eastern Europe who want to learn English. We are now at the stage where we have
+begun our initial writing, design and programming of our first mobile app. We are presently marketing a product, through
+the Google App store, which can be found at: https://play.google.com/store/apps/details?id=com.iloadapp.abcmagicworld.
+
+ 
+
+Educational App
+
+ 
+
+As individuals continue to utilize mobile devices
+for their information, education and entertainment from traditional media sources such as the personal computers and print publications,
+the opportunity to reach more consumers with a wider range of digitally enhanced multi-media tools is possible.
+
+ 
+
+Our initial product launch will be directed
+towards education/early child development, such as learning the English alphabet utilizing visual aides in a game setting environment.
+Our target audience are Eastern Europeans who want to learn English as a second language and the parents of preschool and kindergarten
+children who want their children to learn English alphabet. The app will direct its audience to pictures of the letters,
+and lead them into a game where they can work on letter recognition.
+
+ 
+
+41
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Recognizing and matching letters to their sounds
+builds basic reading skills. Learning the letters and sounds of the English alphabet creates the foundational skills needed for
+understanding the written language. Children who are learning to read first need to recognize, name, and connect their letters
+to sounds. Then they can begin to decode each individual sound.
+
+ 
+
+A separate app will be designed for our target
+audience, where can work on telling the difference between vowels and consonants. The apps can improve their dictionary and encyclopedia
+skills by putting words in alphabetical order. After our target audience has mastered the alphabet, we plan to develop an app for
+spelling games, root words games, and even work on learning better vocabulary and writing skills. Management believes learning
+language arts can be easier when students have an interesting and challenging way of learning through the use of a game app.
+
+ 
+
+Company s future website
+
+ 
+
+The Company s website (www.ILoadApp.com) is currently under
+construction. Once ready, it will serve the interested parties in obtaining information regarding apps we intend to provide in
+future. Potential customers or investors will be able to contact the Company electronically. 
+
+ 
+
+Company will be using its website to market its app(s). Management
+plans to have a demonstration model of the app(s) on its website, where future customers can understand what the app(s) offer and
+how they work.
+
+ 
+
+Marketing Strategy
+
+ 
+
+Once the Company s website
+and app(s) are functional, management plans to contact the Apple s App Store, Google Play, the Windows Phone Store and BlackBerry
+World to make their apps available through this media. Each of these four stores represents a different market proposition for
+app developers, and remains the primary outlet to reach users on the platforms they serve. Management has yet to establish a price
+for its future apps, but expects to establish a price base between $1.00 and $2.00 per app.
+
+ 
+
+Competition
+
+ 
+
+The development, distribution and sale of apps
+is a highly competitive business, characterized by frequent product introductions and rapidly emerging new platforms, and new technologies.
+There are multitude of language learning apps available in the marketplace. We will be competing against Babbel,
+Duolingo, Busuu, 50 languages.com, who all offer language app learning courses. For end users, we will compete primarily
+on the basis of quality, brand, customer reviews and price. We intend to differentiate ourselves from our competitors by developing
+an English language learning app directed toward Eastern European users. We perceive our app will offer explanations in Eastern
+European languages to explain how to use our app. We will compete for promotional placement
+with other intellectual property developers. We will also compete for experienced and talented employees.
+
+ 
+
+42
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Some of our competitors and our potential
+competitors advantages over us, either globally or in particular geographic markets, include the following:
+
+ 
+
+ 
+ significantly greater revenues and financial resources;
+
+ 
+
+ 
+ stronger brand and consumer recognition regionally or worldwide;
+
+ 
+
+ 
+ greater experience with the apps business model;
+
+ 
+
+ 
+ the capacity to leverage their marketing expenditures across a broader portfolio of mobile and non-mobile products;
+
+ 
+
+ 
+ larger installed customer bases from related platforms such as games or social networking websites to which they can market and sell mobile games;
+
+ 
+
+ 
+ more substantial intellectual property of their own from which they can develop games without having to pay royalties;
+
+ 
+
+ 
+ lower labor and development costs and better overall economies of scale;
+
+ 
+
+ 
+ greater resources to make app acquisitions;
+
+ 
+
+ 
+ greater platform-specific focus, experience and expertise; and
+
+ 
+
+ 
+ broader global distribution and presence.
+
+ 
+
+ILoadApp has not yet entered the app market
+and has no market penetration to date. Once we have entered the app market, we will be one of many participants in the app business.
+Many established, yet well financed entities are currently active in the business of marketing and selling apps. Nearly all ILoadApp's
+competitors have significantly greater financial resources, technical expertise, and managerial capabilities than ILoadApp. We
+are, consequently, at a competitive disadvantage in the market. Therefore, ILoadApp may not be able to establish itself within
+the industry at all.
+
+ 
+
+ 
+
+INTELLECTUAL PROPERTY 
+
+ 
+
+We rely or plan to rely on a combination of
+trademark, copyright, trade secret and patent laws, as well as confidentiality procedures and contractual provisions to protect
+our apps and the apps we might develop in the future. We currently have no pending patents nor trademarks.
+
+ 
+
+From time-to-time, we expect that we may encounter
+disputes over rights and obligations concerning intellectual property. Also, the efforts management has taken to protect its proprietary
+rights may not be sufficient or effective. Any significant impairment of its intellectual property rights could harm the existing
+business, the brand and reputation, and the ability of the business to compete on a going forward basis. Also, protecting our intellectual
+property rights could be costly and time consuming.
+
+ 
+
+43
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Employees
+
+ 
+
+We currently has no employees, our CEO performs
+all duties related to the operations of this business. We also plan to utilize additional independent contractors on a part-time/as
+needed basis.
+
+ 
+
+ 
+
+DESCRIPTION OF PROPERTY
+
+ 
+
+Our corporate headquarters are located at:
+190/1 Alba Iulia St., Chisinau in the country of Moldova, in an office building adjacent to the Kvint
+Palace Restaurant. We do not own any real property. This administrative office is being provided at no cost by the Officer
+of the Company. The Officer will not seek reimbursement for providing this administrative space. Management believes that its current
+facilities are adequate for its needs through the next twelve months, and that, should it be needed, suitable additional space
+will be available to accommodate expansion of the Company's operations on commercially reasonable terms, although there can be
+no assurance in this regard.
+
+ 
+
+ LEGAL PROCEEDINGS
+
+ 
+
+We are not aware of any pending or threatened
+legal proceedings which involve us.
+
+ 
+
+44
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
+ON ACCOUNTING AND FINANCIAL DISCLOSURE
+
+ 
+
+None.
+
+ 
+
+ 
+
+QUANTITATIVE AND QUALITATIVE DISCLOSURES
+ABOUT MARKET RISK
+
+ 
+
+We are exposed to market risks, which include
+interest rate risk and potentially the prices of our apps. We do not engage in financial transactions for trading or speculative
+purposes.
+
+ 
+
+Product Prices. We are exposed to fluctuation
+in market prices for our future apps. We do not enter into forward contracts or other market instruments as a means of achieving
+our objectives or minimizing our risk exposures.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+45
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS,
+AND CONTROL PERSONS
+
+and
+Corporate Governance
+
+ 
+
+The following table sets forth the names and
+ages of the current directors and executive officers of the Company, the principal offices and positions with the Company held
+by each person and the date such person became a director or executive officer of the Company. The executive officers of the Company
+are elected annually by the Board of Directors. The directors serve one-year terms until their successors are elected. The executive
+officers serve terms of one year or until their death, resignation or removal by the Board of Directors. 
+
+ 
+
+ Name
+ Age
+ Position & Offices Held
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Veronica Trifon
+ 31
+ Director/Chairman/CEO/CFO/Secretary
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Biography of Veronica Trifon, Director, Chairman, CEO, and CFO
+
+ 
+
+Veronica Trifon brings to ILoad App over five
+years of experience in the computer software program business and six years as an educator. She is familiar with business operations
+and requirements to develop and design educational apps. Her experience in the industry includes working with customers, working
+with computer programmers and working as a Chief Accountant. It is this background that led to the conclusion that Ms. Trifon should
+serve as director of the Company. Ms. Trifon plans to devote approximately 20-hours a week to ILoadApp business operations.
+
+ 
+
+EMPLOYMENT HISTORY
+
+Work History
+
+2013 – present Chief Executive and Financial Officer of
+ILoadApp
+
+2008 – present Chief-accountant, "Riolit Sistem"
+SRL. Riolit is a computer company that offers
+
+IT solutions to its customers.
+
+2008 – May 2013 Chief-accountant, ICS "Sinclea"
+SRL Sinclea provides industrial cleaning to
+
+commercial clients.
+
+2002 – present Accountant, "Livitcom
+Plus" SRL, is a small company, that distributes and sells
+
+consumer products.
+Duties include preparing financial reports.
+
+Academic Positions
+
+2006 – 2011 Lecturer, Moldova State University, department
+Finances and Bank Activity
+
+2005 – 2006 Assistant lecturer, Moldova State University,
+department Finances and Bank
+
+Activity
+
+ 
+
+Education
+
+2008 – present Doctorate
+in Corporate Finance, Moldova State University
+
+2005 – 2006 Masters in Banking and Stock Exchange, Moldova
+State University
+
+2005 – 2006 Professional qualification, the Association
+of Professional Accountants and
+
+Auditors of the Republic of Moldova
+
+2001 – 2005 International Institute of Management (Business
+Administration Department),
+
+Chisinau
+
+1997 – 2001 Lyceum, "Vasile Alecsandri", Chisinau
+
+ 
+
+Ms. Trifon was born in Anenii
+Noi, Republic of Moldova on July 3, 1983.
+
+ 
+
+46
+
+Involvement in Certain Legal Proceedings
+
+ 
+
+Our director, executive officer and control
+person(s) has not been involved in any of the following events during the past ten years and which is material to an evaluation
+of the ability or the integrity of our director or executive officer:
+
+ 
+
+1. 
+any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer
+either at the time of the bankruptcy or within two years prior to that time;
+
+ 
+
+2. 
+any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations
+and other minor offences);
+
+ 
+
+3. 
+being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent
+jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting her involvement in any type of business,
+securities or banking activities;
+
+ 
+
+4. 
+being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission
+to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;
+
+ 
+
+5. 
+any judicial or administrative proceedings resulting from involvement in mail or wire fraud or fraud in connection with
+any business entity;
+
+ 
+
+6. 
+Any judicial or administrative proceedings based on violations of federal or state securities, commodities, banking or insurance
+laws and regulations, or any settlement to such actions; and
+
+ 
+
+7. 
+Any disciplinary sanctions or orders imposed by a stock, commodities or derivatives exchange or other self-regulatory organization.
+
+ 
+
+Board of Directors
+
+ 
+
+Our board of directors consists of only one
+members, who serves a one-year term without any compensation.
+
+ 
+
+Term of Office
+
+ 
+
+Our directors are appointed for a one-year
+term to hold office until the next annual meeting of our stockholders or until removed from office in accordance with our bylaws.
+Our officers are appointed by our board of directors and hold office until the next annual meeting of the board of directors and
+until such officer's successor shall have been elected and qualified subject to earlier resignation or removal by the board.
+
+ 
+
+ 
+
+47
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Audit Committee
+
+ 
+
+The company does not presently have an Audit
+Committee. The sole member of the Board sits as the Audit Committee. No qualified financial expert has been hired because the company
+is too small to afford such expense.
+
+ 
+
+ 
+
+Committees and Procedures
+
+ 
+
+1. 
+The registrant has no standing audit, nominating and compensation committees of the Board of Directors, or committees performing
+similar functions. The Board acts itself in lieu of committees due to its small size.
+
+ 
+
+2. 
+The view of the board of directors is that it is appropriate for the registrant not to have such a committee because its
+director participate in the consideration of director nominees and the board and the company are so small.
+
+ 
+
+3. 
+The members of the Board who acts as nominating committee is not independent, pursuant to the definition of independence
+of a national securities exchange registered pursuant to section 6(a) of the Act (15 U.S.C. 78f(a).
+
+ 
+
+4. 
+The nominating committee has no policy with regard to the consideration of any director candidates recommended by security
+holders, but the committee will consider director candidates recommended by security holders.
+
+ 
+
+5. 
+The basis for the view of the board of directors that it is appropriate for the registrant not to have such a policy is
+that there is no need to adopt a policy for a small company.
+
+ 
+
+6. 
+The nominating committee will consider candidates recommended by security holders, and by security holders in submitting
+such recommendations.
+
+ 
+
+7. 
+There are no specific, minimum qualifications that the nominating committee believes must be met by a nominee recommended
+by security holders except to find anyone willing to serve with a clean background.
+
+ 
+
+8. 
+The nominating committee's process for identifying and evaluation of nominees for director, including nominees recommended
+by security holders, is to find qualified persons willing to serve with a clean backgrounds. There are no differences in the manner
+in which the nominating committee evaluates nominees for director based on whether the nominee is recommended by a security holder,
+or found by the board.
+
+ 
+
+ 
+
+Code of Ethics
+
+ 
+
+We have not adopted a Code of Ethics for the Board and any salaried
+employees.
+
+ 
+
+48
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+EXECUTIVE COMPENSATION
+
+ 
+
+The following summary compensation table sets
+forth all compensation awarded to, earned by, or paid to the named executive officer paid by us for the Company's last completed
+fiscal year in all capacities for the accounts of our executives, including the Chief Executive Officer (CEO).
+
+ 
+
+ 
+
+SUMMARY COMPENSATION TABLE
+
+ 
+
+Compensation
+
+ 
+
+The following table sets forth certain compensation
+information for: (i) each person who served as the an officer and/director of our company at any time during the year ended May
+31, 2013, regardless of compensation level, and (ii) each of our other executive officers. The foregoing persons are collectively
+referred to herein as the "Named Executive Officers." Compensation information is shown for fiscal year ending May 31,
+2013.
+
+ 
+
+ 
+
+Summary Compensation Table
+
+ 
+
+ 
+ 
+ 
+ 
+ Year
+ 
+ 
+ 
+ Compen-
+ 
+
+ 
+ 
+ 
+ Principal
+ Ending
+ Salary
+ Bonus
+ Awards
+ sation
+ Total
+
+ Name
+ Position
+ May 31, 2013
+ ($)
+ ($)
+ ($)
+ ($)
+ ($)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Veronica Trifon
+ CEO/CFO/Dir.
+ 2013
+ 0
+ 0
+ 0
+ 0
+ 0
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Note: Veronica Trifon was appointed to the Company as
+an Officer and Director on May 22, 2013.
+
+ 
+
+We do not maintain key-woman life insurance
+for our executive officer/director. We do not have any long-term compensation plans. We do not have any employment agreements.
+
+ 
+
+As of the date hereof, there have been no grants
+of stock options to purchase our Common Stock made to the executive officer named in the Summary Compensation Table.
+
+ 
+
+There have been no awards made to the named
+executive officer under any long term incentive plan.
+
+ 
+
+ 
+
+Compensation of Directors
+
+ 
+
+Directors are permitted to receive fixed fees
+and other compensation for their services as directors. The Board of Directors has the authority to fix the compensation of directors.
+No amounts have been paid to, or accrued to our sole director in such capacity.
+
+ 
+
+49
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+
+ 
+
+The following table presents information, to
+the best of our knowledge, about the ownership of our common stock on June 24, 2014 relating to those persons known to beneficially
+own more than 5% of our capital stock and by our named Executive Officer and Directors.
+
+ 
+
+Beneficial ownership is determined in accordance
+with the rules of the U. S. Securities and Exchange Commission and does not necessarily indicate beneficial ownership for any other
+purpose. Under these rules, beneficial ownership includes those shares of common stock over which the stockholder has sole or shared
+voting or investment power. It also includes shares of common stock that the stockholder has a right to acquire within 60 days
+after June 24, 2014 pursuant to options, warrants, conversion privileges or other right. The percentage ownership of the outstanding
+common stock, however, is based on the assumption, expressly required by the rules of the Securities and Exchange Commission, that
+only the person or entity whose ownership is being reported has converted options or warrants into shares of ILoadApp common stock.
+The Company does not have any outstanding options, warrants or other securities exercisable for or convertible into shares of its
+common stock.
+
+ 
+
+ Title of Class
+ 
+ Name and Address of Beneficial Owner
+ 
+ 
+ 
+ Amount of
+
+ Beneficial Ownership
+
+ 
+ 
+ Percentage of Class(1)
+ 
+ 
+ Percentage of Class after Offering(2)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Common Stock, par value $0.001
+ 
+ 
+ Veronica Trifon(3)
+ 
+ 
+ $
+ 24,000,000
+ 
+ 
+ 
+ 85.7%
+ 
+ 
+ 
+ 82.7%
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Directors and Officers as a Group (1 person) 24,000,000 85.7% 82.7%
+
+ 
+
+1) Percent of Class is based on 28,000,000 shares issued and outstanding
+before
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001581164_extended_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001581164_extended_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001581164_extended_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001581720_loxo_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001581720_loxo_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..53a42faa57aff801aa2bc9e9eacfce4cbfddbd2c
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001581720_loxo_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including our financial statements and the related notes thereto and the information set forth under the sections "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations," in each case included in this prospectus. Unless the context otherwise requires, we use the terms "Loxo," "Loxo Oncology," "company," "we," "us" and "our" in this prospectus to refer to Loxo Oncology, Inc. Overview Loxo Oncology develops targeted small molecule therapeutics for the treatment of cancer in genetically defined patient populations. Our development approach translates key scientific insights relating to the oncogenic drivers of cancer into drugs that are potent and highly selective for their intended targets. Such drugs typically achieve high target engagement, which has been correlated with improved tumor response. We believe our approach will allow us to develop drugs with a high probability of clinical success while reducing the time, costs and risks of drug development. Pre-clinical research indicates that our lead product candidate, LOXO-101, is a potent and selective inhibitor of tropomyosin receptor kinase, or TRK, a family of signaling molecules that appear to play an important role in the development and perpetuation of many cancers. We are evaluating LOXO-101 in a Phase 1 dose escalation trial for patients with advanced solid tumors, and we anticipate reporting data by early 2015. We are also building a pipeline of additional product candidates targeting cancers driven by genetic alterations. Our investors include affiliates of Aisling Capital, OrbiMed, New Enterprise Associates, Access Industries and Deerfield Management Company. Background on Cancer and Oncogene Addiction As genetic testing in cancer becomes more routine, we are learning that cancers arising in diverse sites in the body may share the same type of genetic alterations. Increasingly, tumors may be identified and treated according to their distinguishing genetic alterations, while in the past, the organ of origin was most important. Both research and clinical data suggest that some tumors, while having many identifiable genetic alterations, are primarily dependent on a single activated kinase for their proliferation and survival. This dependency, often referred to as oncogene addiction, renders such tumors highly susceptible to small molecule inhibitors targeting the relevant alteration. The oncogene addiction paradigm appears to be especially important in understanding the pathogenesis of lung cancer. Robust response rates in lung cancer patients with tumors displaying oncogene addiction have supported regulatory approvals for many drugs, including crizotinib (Xalkori) and afatinib (Gilotrif). Researchers and clinical oncologists now often incorporate genetic assessments into clinical trials and routine care with the hope of directing patients to medicines which may have a greater chance of treating their cancers effectively. We believe that increased focus on oncogene addiction will lead to more efficient drug development and more robust clinical responses in genetically defined patient populations. The Loxo Approach We employ a capital-efficient approach to develop drugs for genetically defined patient populations. We collaborate with technology partners that we believe are capable of building potent and highly selective compounds with favorable pharmacologic properties. We believe our approach allows us to reduce the time, costs and risks of cancer drug development, while allowing us to focus on our core competencies of target selection, drug profiling and clinical and regulatory execution. AMENDMENT NO. 2 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents Step 1 Target Selection Target selection requires an understanding of which genetic alterations are oncogenic drivers. We identify and prioritize targets by interpreting two information streams: clinical trial data and academic research. Using clinical trial data, we assess the response signals of drugs in development and identify those that show promise but also demonstrate drug-specific limitations such as poor absorption, poor distribution or unwanted side effects. The appealing aspect of leveraging existing trial data is that clinical activity has already been demonstrated, thereby increasing the likelihood that the target is valid. Using academic research, particularly population-based genetic studies and experiments involving cell and animal models, we identify novel targets with emerging validation. Throughout the target selection process, we leverage the expertise of our scientific advisory board, composed of key opinion leaders, who are familiar with current research and clinical standards of care for a given cancer. We believe our approach identifies targets with a high probability of success. Step 2 Drug Profiling Translating a target insight into a product candidate requires the application of chemistry to a biological problem. We employ advanced third-party technology solutions to develop product candidates with the potential for significant target engagement while maintaining favorable pharmacologic properties. Step 3 Clinical Trial and Regulatory Execution Our clinical development strategy employs a stepwise approach designed to identify response signals early in development and reduce development risks. In Phase 1 of development, we seek to explore one or more doses in patients whose tumors harbor specific genetic alterations and believe this gives us a higher likelihood of demonstrating a clinical benefit. This approach is intended to allow for early insight into the therapeutic potential of a product candidate and the possibility for rapid clinical development and expedited regulatory strategies, such as Breakthrough Therapy Designation, Fast Track Designation, Priority Review and Accelerated Approval. We intend to develop companion diagnostics, with the help of technology partners, to identify patients whose tumors harbor the relevant genetic alterations. Product Candidates LOXO-101 Overview. The selection of LOXO-101 as a clinical candidate demonstrates many important elements of our drug development approach. LOXO-101 is an oral, highly selective and potent inhibitor of TRK, and has favorable pharmacologic properties. There is a growing body of scientific literature implicating TRK alterations in diverse tumor types, including neuroblastoma and lung, thyroid and breast cancer. Many downstream pathways important in cancer are stimulated by activated TRK, such as the PI3-kinase and MAP-kinase pathways. Drugs targeting these pathways have generated responses in both solid and hematologic tumors. We selected LOXO-101 after evaluating a series of compounds from distinct chemical scaffolds. In purified enzyme inhibition studies, LOXO-101 demonstrated potent inhibition activity against TRK receptors TRKA, TRKB and TRKC at low concentration levels. LOXO-101 demonstrated favorable specificity by not inhibiting other tested kinases at doses we expect to be clinically relevant. LOXO-101 demonstrated potent inhibition activity in cells driven by TRK signaling at low concentrations. Numerous pharmacology and safety studies in mice, rats, dogs and monkeys have demonstrated that LOXO-101 has attractive pharmacologic properties and a favorable therapeutic index. We have exclusive rights to issued composition of matter patents covering LOXO-101 that expire in 2029. LOXO ONCOLOGY, INC. (Exact name of registrant as specified in its charter) Table of Contents Preclinical Efficacy. In a TRKA-driven mouse model of cancer, LOXO-101 demonstrated significant anti-tumor activity. We treated mice with three different doses either once a day (QD) or twice a day (BID) for 14 days and compared this activity to a control group. As shown in the figure below, tumors showed response at all doses, with doses totaling 60 mg/kg or more per day showing disease stabilization, which extended through cessation of dosing. Inhibition of Tumor Growth in TRKA-Driven Mouse Model Phase 1 Clinical Trial. We initiated a Phase 1 dose escalation trial in patients with advanced solid tumors in May 2014 and intend to initiate an expansion phase that will enroll patients with TRK alterations across multiple tumor types. We anticipate data from the dose escalation phase by early 2015. Initial human pharmacokinetic data from the first cohort of this Phase 1 trial demonstrate LOXO-101 was absorbed with good exposure. In addition, no limiting toxicities were reported and dose escalation is proceeding. Preclinical Product Pipeline In addition to LOXO-101, we are advancing multiple programs against both clinically validated and novel kinase alterations. We intend to build a pipeline of product candidates targeting cancers driven by other genetic alterations. We plan to submit our second Investigational New Drug, or IND, application as early as the end of 2015. Loxo Oncology Strengths Management Our team has significant experience in the discovery, development and regulatory approval of novel therapeutics. Our Chief Executive Officer and acting Chief Medical Officer were practicing physicians in the field of oncology. Our Chief Executive Officer has experience as a healthcare investor and as a reviewer at the U.S. Food and Drug Administration, or FDA. Our Chief Scientific Officer led the medicinal chemistry teams that discovered erlotinib (Tarceva) and tofacitinib (Xeljanz), two drugs that are approved in the United States. Our acting Chief Medical Officer helped lead the development Table of Contents of carfilzomib (Kyprolis) and ibrutinib (Imbruvica), two oncology drugs that are approved under Accelerated Approval in the United States. Scientific Advisory Board Our Scientific Advisory Board is integral to our success and is actively involved in target selection, product profiling and clinical development. We have assembled the following team of key opinion leaders: Keith T. Flaherty, M.D. an Associate Professor at Harvard Medical School and the Director of the Termeer Center for Targeted Therapy at the Cancer Center at Massachusetts General Hospital. Dr. Flaherty focuses on the understanding of novel, molecularly targeted therapies. Dr. Flaherty serves on the board of directors of Clovis Oncology. Jeffrey A. Engelman, M.D., Ph.D. an Associate Professor at Harvard Medical School and the Director of the Center for Thoracic Cancers at Massachusetts General Hospital. Dr. Engelman focuses on novel therapeutic strategies for the treatment of cancer, with a particular emphasis on lung cancer. Dr. Engelman serves on the Scientific Advisory Board of Agios Pharmaceuticals. Ross L. Levine, M.D., an Associate Member at Memorial Sloan Kettering Cancer Center focuses on the molecular genetics of myeloid malignancies. Dr. Levine's research contributed to the development of Foundation Medicine's hematologic panel. Ben Ho Park, M.D., Ph.D., an Associate Professor of Oncology at Johns Hopkins University School of Medicine, has a research program focused on validating genetic targets, with a particular interest in breast cancer. David B. Solit, M.D., a Director in the Center for Molecular Oncology at Memorial Sloan Kettering Cancer Center, focuses on the development of cancer therapies that target pathways responsible for cancer initiation and progression. Dr. Solit leads a multidisciplinary team focused on translating novel molecular insights into routine clinical practice. Array Collaboration We entered into a multi-target collaboration with Array BioPharma Inc., or Array, in July 2013 and expanded the collaboration in November 2013 and April 2014. We selected Array as a collaboration partner because of its experience in building potent and highly selective kinase inhibitors with favorable drug properties. Our Strategy Our goal is to translate key scientific insights relating to underlying oncogenic drivers into the development of potent and highly selective therapeutics. To execute our strategy, we intend to: Advance our lead product candidate LOXO-101 through clinical development. Develop a pipeline of potent and highly selective targeted therapeutics. Increase the probability for clinical success by prioritizing targets for development that are believed to be oncogenic drivers. Work with experienced third parties in the field of diagnostics. Conduct international clinical and regulatory programs to support our global approval and commercialization strategy. Leverage our business model to maximize the value of our current external collaboration while remaining open to additional collaboration opportunities. Loxo Oncology, Inc. One Landmark Square Suite 1122 Stamford, CT 06901 (203) 653-3880 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents Risks Affecting Us
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001582966_cheniere_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001582966_cheniere_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001582966_cheniere_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001583773_ixir_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001583773_ixir_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..fc4e2cf119a4fb39e460b8fc6e11b1e1effa1341
--- /dev/null
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+PROSPECTUS SUMMARY The following summary highlights selected information from this prospectus and may not contain all the information that is important to you. To understand our business and this offering fully, you should read this entire prospectus carefully, including the financial statements and the related notes beginning on page F-1. When we refer in this prospectus to the Company, we, us, and our, we mean IXIR Productions, Inc., a Nevada corporation. This prospectus contains forward-looking statements and information relating to IXIR Productions, Inc. See Cautionary Note Regarding Forward Looking Statements on page 14 . Our Company IXIR Productions, Inc. is a boutique, one-stop-shop record label. Our Company is in the business of recruiting music artists, and providing them with worldwide digital distribution, production, music videos, music press relations, online marketing and event promotion. Mr. John Azoulay is the sole officer and director of IXIR Productions, Inc. Since the Company s incorporation date (March 19, 2013), John Azoulay has served as the Company s President, Director, Secretary, and Treasurer. There is no Board of Directors. Our mission is to provide essential services to music artists including worldwide online distribution, music recording and production, music release, marketing and promotions, online marketing, music videos, and club/DJ promotion. It is our intent to provide the services described, but that we do not have the funding or operational ability to do so at this time. We currently have one artist, our sole officer and director, Mr. Azoulay. All of our songs available for sale are Mr. Azoulay s songs that he self-produced and that we have generated insignificant revenues from the sales of these songs. The Company believes it is not a blank check company because the company has no plans or intentions to engage in a merger or acquisition with an unidentified company or person or, once it is a reporting company, to be used as a vehicle for a private company to become a reporting company. Through December 31, 2013, the Company has incurred a net loss of $1,303. The Company has only one officer and director who will devote approximately 20 hours per month to the Company. We are in the early stages of developing our one-stop-shop record label and our brand. We currently have minimal revenues, no operating history, and no music artist clients but our sole officer for our proposed services. Our plan of operations over the 12 month period following successful completion of our offering is to build awareness of our boutique one-stop-shop record label. To date we have released 17 songs that are available for sale through the major music portals on the Internet. We intend to charge our future clients a flat-rate fee for music production services and 15% commission of sales of their music. Even if we are successful in raising all of the funding under this Offering, we will still not be in a position to generate any significant revenues or become profitable. We still must raise significant additional funding to continue with our business. The Offering is only sufficient to enable us to design and launch our website, branding and identify potential music artists. Since we have only budgeted $20,000 for advertising and promotion, it might not be sufficient to build brand awareness in the public domain. We believe we will require an additional $40,000 for advertising and promotion expenses and $30,000 to hire an event manager consultant for a period of 6 months to assist us in promoting our music artists. From inception until the date of this filing we have had limited operating activities, primarily consisting of the incorporation of our company and the initial equity funding by our officer and director. We received our initial funding of $12,500 through the sale of common stock to our officer and director, who purchased 5,000,000 shares at $0.0025 per share. We are an "emerging growth company" as defined in the Jumpstart our Business Startups Act of 2012. For as long as we are an emerging growth company, we will not be required to comply with the requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. Our executive offices are located at 4 Rue Santeuil, Nantes 44000, France. Our telephone number is +33-96-707-7099. The Offering This prospectus covers up to 500,000 shares to be issued and sold by the Company at a price of $0.10 per share in a direct public offering. ABOUT THIS OFFERING Securities Being Offered Up to 500,000 shares of common stock of IXIR Productions, Inc. to be sold by the Company at a price of $0.10 per share. Initial Offering Price The Company will sell up to 500,000 shares at a price of $0.10 per share. The Company will offer and sell the shares of its common stock at a price of $0.10 per share in a direct offering to the public. The offering will conclude when the Company has sold all of the 500,000 shares of common stock offered by it or a maximum of 180 days. The Company may, in its sole discretion, decide to terminate the registration of the shares offered by the Company. Terms of the Offering An investment in our common stock is highly speculative and involves a high degree of risk. See Risk Factors beginning on page 6. Termination of the Offering The offering will be open for 180 days. RISK FACTORS An investment in our common stock is highly speculative, involves a high degree of risk, and should be made only by investors who can afford a complete loss. You should carefully consider the following risk factors, together with the other information in this prospectus, including our financial statements and the related notes, before you decide to buy our common stock. Our most significant risks and uncertainties are described below; however, they are not the only risks we face. If any of the following risks actually occur, our business, financial condition, or results of operations could be materially adversely affected, the trading of our common stock could decline, and you may lose all or part of your investment therein. Risks Relating to the Early Stage of our Company We are at a very early operational stage and our success is subject to the substantial risks inherent in the establishment of a new business venture. Our business and operations of recruiting music artists, and providing them with worldwide digital distribution, production, music videos, music press relations, online marketing and event promotion should be considered to be in a very early stage and subject to all of the risks inherent in the establishment of a new business venture. The Company may be unable to recruit artists or appropriate artists to match the promotion and distribution channels which the Company has access to. If the Company is unable to expand its artist or music inventory, the business may fail. We have a very limited operating history and our business plan is unproven and may not be successful. Our Company was formed in March 2013 but we have not yet begun full scale operations. We have not proven that our business model will allow us to generate a profit. We have suffered operating losses since inception and we may not be able to achieve profitability. We had an accumulated deficit of $1,303 as of December 31, 2013. We are sustaining substantial operation and net losses, and it is possible that we will never be able to sustain or develop the revenue levels necessary to attain profitability. We may have difficulty raising additional capital, which could deprive us of necessary resources. In order to support the initiatives envisioned in our business plan, we will need to raise additional funds through public or private debt or equity financing, collaborative relationships or other arrangements. Our ability to raise additional financing depends on many factors beyond our control, including the state of capital markets, the market price of our common stock and the development or prospects for development of competitive technology by others. Because our common stock is not listed on a major stock market, many investors may not be willing or allowed to purchase it or may demand steep discounts. Sufficient additional financing may not be available to us or may be available only on terms that would result in further dilution to the current owners of our common stock. If we are unsuccessful in raising additional capital, or the terms of raising such capital are unacceptable, we may have to modify our business plan and/or significantly curtail our planned activities and other operations. Material weaknesses in our Internal Controls may result in unreliability of our financial statements. Our ability to generate reliable financial statements may be impeded by the material weaknesses in our internal controls including the lack of an audit committee. Our sole officer and director has little knowledge of U.S. GAAP and no audit committee to assist him which may result in untimely or unreliable financial statements. Risks Relating to Our Business We have limited sales and marketing experience, which increases the risk that our business will fail. Our officers, who will be responsible for marketing our website to potential users, have no experience in the social media or internet industries, and have only nominal sales and marketing experience. Further, we have budgeted only $20,000 toward sales and marketing efforts over the next 12 months, which by industry standards is a very limited amount of capital with which to launch our effort. Given the relatively small marketing budget and limited experience of our officers, there can be no assurance that such efforts will be successful. Further, if our initial efforts to create a market for our website are not successful, there can be no assurance that we will be able to attract and retain qualified individuals with marketing and sales expertise to attract subscribers to our website. Our future success will depend, among other factors, upon whether our services can be sold at a profitable price and the extent to which consumers acquire, adopt, and continue to use them. There can be no assurance that our website will gain wide acceptance in its targeted markets or that we will be able to effectively market our services. We may not be able to execute our business plan or stay in business without additional funding. Our ability to generate future operating revenues depends in part on whether we can obtain the financing necessary to implement our business plan. As disclosed herein the Company expects to require $31,000 to operate according to the business plan for the next 12 months which funds would be mostly utilized for identifying and recruiting music artists and for advertising and promoting the music artists. In the event that the full amount of this offering is not sold, the Company would have to scale down its marketing and travel which would slow the growth of the Company. If such conditions and constraints continue or if there is no investor appetite to finance our specific business, we may not be able to acquire additional financing through credit markets or equity markets. Even if additional financing is available, it may not be available on terms favorable to us. At this time, we have not identified or secured sources of additional financing. Our failure to secure additional financing when it becomes required will have an adverse effect on our ability to remain in business. If our estimates related to future expenditures are erroneous or inaccurate, our business will fail and you could lose your entire investment. Our success is dependent in part upon the accuracy of our management s estimates of our future expenditures for legal and accounting services (including those we expect to incur as a publicly reporting company), for website marketing and development expenses, and for administrative expenses, which management estimates to be approximately between $12,000 and $45,000 over the next twelve months. If such estimates are erroneous or inaccurate, or if we encounter unforeseen costs, we may not be able to carry out our business plan, which could result in the failure of our business and the loss of your entire investment. Our auditor has raised substantial doubts about our ability to continue as a going concern and if we are unable to continue our business, our shares may have little or no value. The Company s ability to become a profitable operating company is dependent upon its ability to generate revenues and/or obtain financing adequate to fulfill its research and market introduction activities, and achieve a level of revenues adequate to support our cost structure has raised substantial doubts about our ability to continue as a going concern. We plan to attempt to raise additional equity capital by selling shares in this offering and, if necessary, through one or more private placement or public offerings. However, the doubts raised, relating to our ability to continue as a going concern, may make our shares an unattractive investment for potential investors. These factors, among others, may make it difficult to raise any additional capital. We are in a competitive market which could impact our ability to gain market share which could harm our financial performance. The business of music is very competitive. Barriers to entry are relatively low, and we face competitive pressures from companies anxious to join this niche. There are a number of successful websites operated by proven companies that offer similar services which may prevent us from gaining enough market share to become successful. These competitors have existing customers that may form a large part of our targeted client base, and such clients may be hesitant to switch over from already established competitors to our service. If we cannot gain enough market share, our business and our financial performance will be adversely affected. We are a small company with limited resources relative to our competitors and we may not be able to compete effectively. The niche one-stop-shop record label of our competitors have longer operating histories, greater resources and name recognition, and a larger base of customers than we have. As a result, these competitors will have greater credibility with our potential customers. They also may be able to adopt more aggressive pricing policies and devote greater resources to the development, promotion, and sale of their services than we may be able to devote to our services. Therefore, we may not be able to compete effectively and our business may fail. The loss of the services of our sole officer or our failure to timely identify and retain competent personnel could negatively impact our ability to develop and sell our services. The development of our services will continue to place a significant strain on our limited personnel, management, and other resources. Our future success depends upon the continued services of our executive officer, John Azoulay who is developing our business, and on our ability to identify and retain competent consultants and employees with the skills required to execute our business objectives. The loss of the services of our officer or our failure to timely identify and retain competent personnel could negatively impact our ability to develop our website and sell our services, which could adversely affect our financial results and impair our growth. Our officer and director has conflicts of interest in that he has other time commitments that will prevent him from devoting full-time to our operations, which may affect our operations. Because our sole officer and director, who is responsible for all our business activities, does not devote his full working time to operation and management of us, the implementation of our business plans may be impeded. Our sole officer and director has other obligations and time commitments, which will slow our operations and may reduce our financial results and as a result, we may not be able to continue with our operations. We expect Mr. Azoulay to spend approximately 20 hours a month on the business of our Company. Additionally, when he becomes unable to handle the daily operations on his own, we may not be able to hire additional qualified personnel to replace them in a timely manner. If this event should occur, we may not be able to reach profitability, which might result in the loss of some or all of your investment in our common stock. Foreign Officer and Director could result in difficulty enforcing rights. The officers and directors of the Company are located in France and as such investors may have difficulty in enforcing their legal rights under the United States securities laws. It may be difficult to effect service of process or enforce judgments obtained in U.S. courts against any officers or directors who are located in France. Investors will have little voice regarding the management of IXIR Productions, Inc. due to the large ownership position held by our existing management and thus it would be difficult for new investors to make changes in our operations or management, and therefore, shareholders would be subject to decisions made by management and the majority shareholders, including the election of directors. Mr. Azoulay, our sole officer and director, currently owns 100% of IXIR s issued and outstanding common stock. If we are successful in completing the Maximum Offering he will own 90.9% of the Company s issued and outstanding common stock, and is still in a position to continue to control IXIR Productions, Inc.. If we close our Offering with less than the Maximum, his percentage ownership is even higher. Such control may be risky to the investor because our company's operations are dependent on a very few people who could lack ability, or interest in pursuing our operations. In such event, our business may fail and you may lose your entire investment. Moreover, investors will not be able to effect a change in the Company s board of directors, business or management. We intend to become a reporting issuer and will be subject to the periodic reporting requirements of the Securities Exchange Act of 1934, which will require us to incur audit fees and legal fees in connection with the preparation of such reports. These additional costs will negatively affect our ability to earn a profit. Following the effective date of the registration statement in which this prospectus is included, we intend to become a reporting issuer and will be required to file all periodic and other required reports with the Securities and Exchange Commission, pursuant to the Securities Exchange Act of 1934 and the rules and regulations thereunder. In order to comply with such requirements, our independent registered auditors will have to review our financial statements on a quarterly basis and audit our financial statements on an annual basis. Moreover, our legal counsel will have to review and assist in the preparation of such reports. Although we believe (Please refer to Use of Proceeds and Plan of Operations ) that the $12,000 we have estimated for these costs should be sufficient for the 12 month period following the completion of our offering, the costs charged by these professionals for such services may vary significantly. Factors such as the number and type of transactions that we engage in and the complexity of our reports cannot accurately be determined at this time and may have a major negative effect on the cost and amount of time to be spent by our auditors and attorneys. However, the incurrence of such costs will obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a profit. The lack of public company experience of our management team could adversely impact our ability to comply with the reporting requirements of U.S. securities laws. Mr. Azoulay lacks public company experience, which could impair our ability to comply with legal and regulatory requirements such as those imposed by Sarbanes-Oxley Act of 2002. He has never been responsible for managing a publicly traded company. Such responsibilities include complying with federal securities laws and making required disclosures on a timely basis. Any such deficiencies, weaknesses or lack of compliance could have a materially adverse effect on our ability to comply with the reporting requirements of the Securities Exchange Act of 1934 which is necessary to maintain our public company status. If we were to fail to fulfill those obligations, our ability to continue as a U.S. public company would be in jeopardy in which event you could lose your entire investment in our company. As an Emerging Growth Company Under The Jobs Act, We Are Permitted To Rely On Exemptions From Certain Disclosure Requirements. We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we have elected not to: - have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; - comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); - submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and - disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive s compensation to median employee compensation. Additionally, under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourselves to this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies . We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. Notwithstanding the above, we are also currently a smaller reporting company , meaning that we have a public float of less than $75 million and annual revenues of less than $50 million during the most recently completed fiscal year. In the event that we are still considered a smaller reporting company , when we cease being an emerging growth company , the disclosure we will be required to provide in our SEC filings will increase, but will still be less than it would be if we were not considered either an emerging growth company or a smaller reporting company . Specifically, similar to emerging growth companies , smaller reporting companies are able to provide simplified executive compensation disclosures in their filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting; are not required to conduct say-on-pay and frequency votes until annual meetings occurring on or after January 21, 2013; and have certain other decreased disclosure obligations in our SEC filings, including, among other things, only being required to provide two years of audited financial statements in annual reports. Decreased disclosures in our SEC filings due to our status as an emerging growth company or smaller reporting company may make it harder for investors to analyze the Company s results of operations and financial prospects and could make our common stock less attractive to investors. Our costs for disclosure will also increase significantly when we are no longer considered either an emerging growth company or a smaller reporting company , including costs related for disclosure under Section 404 of the Sarbanes- Oxley Act. As a shell company there are restrictions imposed upon the transferability of our unregistered shares We are considered to be a shell company as defined under Rule 405 in the Securities Act, with nominal operations and assets consisting solely of cash and cash equivalents. While we remain as a shell company, any unregistered securities sold by our Company can only be resold through registration under the Securities Act of 1933, or by meeting the conditions of Rule 144(i), under which unregistered securities shall remain restricted for a period of 12 months following the date our Company is no longer considered a shell company and appropriate Form 10 information has been filed with the SEC. Form 10 information is, generally speaking, the same type of information as we are required to disclose in this prospectus, but without an offering of securities. Accordingly, there will be illiquidity of any future trading market until the company is no longer considered a shell company, and these restrictions could significantly limit our ability to raise additional funding. If we are unable to obtain additional financing, our business will fail and you may lose some or all of your investment in our common stock. Risks Relating to our Stock The Offering price of $0.10 per share is arbitrary. The Offering price of $0.10 per share has been arbitrarily determined by our management and does not bear any relationship to the assets, net worth or projected earnings of the Company or any other generally accepted criteria of value. We have no firm commitments to purchase any shares. We have no firm commitment for the purchase of any shares. Therefore there is no assurance that a trading market will develop or be sustained. The Company has not engaged a placement agent or broker for the sale of the shares. The Company may be unable to identify investors to purchase the shares and may have inadequate capital to support its ongoing business obligations. State securities laws may limit resales of your securities. State securities laws may limit resales of our securities. Because our shares will not be considered Covered Securities as defined in Section 18 of the Securities Act of 1933, resale of our shares may not be permitted unless our shares are qualified for trading under applicable state securities laws or there is an exemption for secondary trading in such state. All proceeds from the sale of shares offered by the company will be immediately available for use by the Company. There is no minimum offering amount and we have not established an escrow to hold any of the proceeds from the sale of the shares offered by the Company. As a result, all proceeds from the sale of shares offered by the Company will be available for immediate use by the Company. The proceeds of the sale may not be sufficient to implement the Company s business strategy. We will apply to have our common stock traded over the counter, which may deprive stockholders of the full value of their shares. We will apply to have our common stock quoted via the OTC Electronic Bulletin Board. Therefore, our common stock is expected to have fewer market makers, lower trading volumes and larger spreads between bid and asked prices than securities listed on an exchange such as the New York Stock Exchange or the NASDAQ Stock Market. These factors may result in higher price volatility and less market liquidity for the common stock. The Company may never be approved for trading on any exchange. We will have broad discretion in how we use the proceeds of this offering and we may not use these proceeds effectively. This could affect our results of operations and cause the value of our common stock to decline. Our management team will have considerable discretion in the application of the net proceeds of this offering, and you will not have the opportunity, as part of your investment decision, to assess whether we are using the proceeds appropriately. We currently intend to use the net proceeds that we receive from this offering as described in Use of Proceeds herein. We may use the net proceeds for corporate purposes that do not improve our results of operations or which cause our stock value to decline. A low market price would severely limit the potential market for our common stock. Our common stock is expected to trade at a price substantially below $5.00 per share, subjecting trading in the stock to certain SEC rules requiring additional disclosures by broker-dealers. These rules generally apply to any non-NASDAQ equity security that has a market price share of less than $5.00 per share, subject to certain exceptions (a penny stock ). Such rules require the delivery, prior to any penny stock transaction, of a disclosure schedule explaining the penny stock market and the risks associated therewith and impose various sales practice requirements on broker-dealers who sell penny stocks to persons other than established customers and institutional or wealthy investors. For these types of transactions, the broker-dealer must make a special suitability determination for the purchaser and have received the purchaser s written consent to the transaction prior to the sale. The broker - dealer also must disclose the commissions payable to the broker-dealer, current bid and offer quotations for the penny stock and, if the broker-dealer is the sole market maker, the broker-dealer must disclose this fact and the broker-dealer s presumed control over the market. Such information must be provided to the customer orally or in writing before or with the written confirmation of trade sent to the customer. Monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. The additional burdens imposed upon broker-dealers by such requirements could discourage broker-dealers from effecting transactions in our common stock. FINRA sales practice requirements may also limit a stockholders ability to buy and sell our stock. In addition to the penny stock rules promulgated by the SEC, which are discussed in the immediately preceding risk factor, FINRA rules require that in recommending an investment to a customer, a broker -dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker dealers to recommend that their customers buy our common stock, which may limit the ability to buy and sell our stock and have an adverse effect on the market value for our shares. An investor s ability to trade our common stock may be limited by trading volume. A consistently active trading market for our common stock may not occur on the OTC Bulletin Board. A limited trading volume may prevent our shareholders from selling shares at such times or in such amounts as they may otherwise desire. Our Company has a concentration of stock ownership and control, which may have the effect of delaying, preventing, or deterring a change of control. Our common stock ownership is highly concentrated. Through ownership of shares of our common stock, one shareholder, John Azoulay, beneficially owns 100% of our total outstanding shares of common stock before this offering. As a result of the concentrated ownership of the stock, this stockholder, acting alone, will be able to control all matters requiring stockholder approval, including the election of directors and approval of mergers and other significant corporate transactions. This concentration of ownership may have the effect of delaying, preventing or deterring a change in control of our company. It could also deprive our stockholders of an opportunity to receive a premium for their shares as part of a sale of our company and it may affect the market price of our common stock. We have not voluntarily implemented various corporate governance measures, in the absence of which, shareholders may have more limited protections against interested director transactions, conflicts of interest and similar matters. Recent federal legislation, including the Sarbanes-Oxley Act of 2002, has resulted in the adoption of various corporate governance measures designed to promote the integrity of the corporate management and the securities markets. Some of these measures have been adopted in response to legal requirements. Others have been adopted by companies in response to the requirements of national securities exchanges, such as the NYSE or The NASDAQ Stock Market, on which their securities are listed. Among the corporate governance measures that are required under the rules of national securities exchanges and NASDAQ are those that address board of directors independence, audit committee oversight and the adoption of a code of ethics. While our Board of Directors has adopted a Code of Ethics and Business Conduct, we have not yet adopted any of these corporate governance measures and, since our securities are not listed on a national securities exchange or NASDAQ, we are not required to do so. It is possible that if we were to adopt some or all of these corporate governance measures, shareholders would benefit from somewhat greater assurances that internal corporate decisions were being made by disinterested directors and that policies had been implemented to define responsible conduct. For example, in the absence of audit, nominating and compensation committees comprised of at least a majority of independent directors, decisions concerning matters such as compensation packages to our senior officers and recommendations for director nominees may be made by a majority of directors who have an interest in the outcome of the matters being decided. Prospective investors should bear in mind our current lack of corporate governance measures in formulating their investment decisions. Because we will not pay dividends in the foreseeable future, stockholders will only benefit from owning common stock if it appreciates. We have never paid dividends on our common stock and we do not intend to do so in the foreseeable future. We intend to retain any future earnings to finance our growth. Accordingly, any potential investor who anticipates the need for current dividends from his investment should not purchase our common stock. There are doubts about our ability to continue as a going concern and if we are unable to continue our business, our shares may have little or no value. The Company s ability to become a profitable operating company is dependent upon its ability to generate revenues and/or obtain financing adequate to fulfill its research and market introduction activities, and achieving a level of revenues adequate to support our cost structure. This has raised doubts about our ability to continue as a going concern. We plan to attempt to raise additional equity capital by selling shares in this offering and, if necessary through one or more private placement or public offerings. However, the doubts raised relating to our ability to continue as a going concern may make our shares an unattractive investment for potential investors. These factors, among others, may make it difficult to raise any additional capital. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting the financial condition of our business. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including, among other things: Factors that might cause these differences include the following: the ability of the Company to offer and sell the shares of common stock offered hereby; changes in existing and potential relationships with collaborative partners; the ability to retain certain members of management; our expectations regarding general and administrative expenses; our expectations regarding cash balances, capital requirements, anticipated revenue and expenses, including infrastructure expenses; other factors detailed from time to time in filings with the SEC. In addition, in this prospectus, we use words such as anticipate, believe, plan, expect, future, intend, and similar expressions to identify forward-looking statements. We undertake no obligation to update publicly or revise any forward -looking statements, whether as a result of new information, future events or otherwise after the date of this prospectus. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this prospectus may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. USE OF PROCEEDS With respect to up to 500,000 shares of common stock to be sold by us, unless we provide otherwise in a supplement to this prospectus, we intend to use the net proceeds from the sale of our securities for general corporate purposes, as follows: USE OF PROCEEDS % of Shares Sold 25% 50% 75% 100% # of Shares Sold 125,000 250,000 375,000 500,000 Gross Proceeds $12,500 $25,000 $37,500 $50,000 Net Cash – June 30, 2013 6,000 6,000 6,000 6,000 Total Before Expenses 18,500 31,000 43,500 56,000 Less: Offering Expenses 10,500 10,500 10,500 10,500 Net After Offering Expenses $8,000 $20,500 $33,000 $45,500 Use of Proceeds: Public company reporting expenses $8,000 $12,000 $12,000 $12,000 Website design and launch — 1,500 1,500 1,500 Branding — 2,000 2,000 2,000 Identify music artists, create & send out music demos — 3,000 3,500 3,500 Event manager consultant — — 3,000 5,000 Advertising & Promotion — 2,000 10,000 20,000 Working capital — — 1,000 1,000 Total $8,000 $20,500 $33,000 $45,000 If we not successful in raising at least 50% of our planned Offering we will not be able fund the cash shortfall to maintain our public reporting obligations, unless we can obtain alternative financing through further equity issuances, debt financing or shareholder loans. We currently have no plans in place to cover the shortfall. Our offering expenses of approximately $10,500 are comprised primarily of legal and accounting expenses, Securities and Exchange Commission ( SEC ) and EDGAR filing fees and transfer agent fees. Our officer and director will not receive any compensation for his efforts in selling our shares. If we are able to sell 375,000 shares of our common stock (75% of the Offering) we can maintain our reporting requirements with the SEC and execute our business plan, but our marketing efforts will be at a medium level. We will be unable to implement any portion of our business plan until we sell at least 250,000 shares of our common stock (50% of the Offering) in this Offering. If we do not sell at least 125,000 shares of our common stock (25% of the Offering) we will not be able to maintain our reporting status with the SEC and remain in good standing with the state of Nevada without additional funds. We currently do not have any arrangements regarding this Offering or following this Offering for further financing and we may not be able to obtain financing when required. Our future is dependent upon our ability to obtain further financing, the successful execution of our business plan, a successful marketing and promotion program, and achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. There are no assurances that we will be able to obtain further funds required for our continued operations. Even if additional financing is available, it may not be available on terms we find favorable. At this time, there are no anticipated sources of additional funds in place. Failure to secure the needed additional financing will have an adverse effect on our ability to remain in business. If we are successful in selling all 500,000 common shares under this Offering, the net proceeds will be used for our business plan and general working capital, during the twelve months following the successful completion of this Offering. In all instances, after the effectiveness of the registration statement of which this prospectus is a part, we will require some amount of working capital to maintain our basic operations and comply with our public reporting obligations. In addition to changing our allocation of cash because of the amount of proceeds received, we may change the use of proceeds because of changes in our business plan. Investors should understand that we have wide discretion over the use of proceeds. Our management will have broad discretion in the allocation of the net proceeds of any offering. Pending such uses, we intend to invest the net proceeds in short-term, investment grade, interest-bearing securities. The Company could operate even with no proceeds from this offering but that the marketing and advertising efforts would be greatly diminished thus greatly slowing the growth of the Company. CAPITALIZATION The following table sets forth our capitalization as of December 31, 2013. December 31, 2013 Current Assets $11,197 Current liabilities — Long-term liabilities — Common stock 5,000 Additional paid-in capital 7,500 Accumulated deficit (1,303) Total stockholder s equity 11,197 Total capitalization $11,197 DILUTION The net tangible book value of our Company as of December 31, 2013 was $4,697 or $0.003 per share of common stock. Net tangible book value per share is determined by dividing the tangible book value of the Company (total tangible assets (not including deferred costs) minus total liabilities) by the number of outstanding shares of our common stock on December 31, 2013. Our net tangible book value and our net tangible book value per share will be impacted by the 500,000 shares of common stock which may be sold by our Company. The amount of dilution will depend on the number of shares sold by our Company. The following example shows the dilution to new investors at an assumed offering price of $0.10 per share. We are registering 500,000 shares of common stock for sale by our Company. If all shares are sold at the offering price of $0.10 per share, and estimated offering expenses of $10,500, our net tangible book value as of December 31, 2013 would have been $44,197 or approximately $0.008 per share. Such an offering would represent an immediate increase in net tangible book value to existing stockholders of $0.007 per share and an immediate dilution to new stockholders of $0.092 per share. The following table illustrates the per share dilution: Assumed public offering price per share $ 0.10 Net tangible book value per share before this offering $ 0.001 Increase attributable to new investors $ 0.007 Net tangible book value per share after this offering $ 0.008 Dilution per share to new stockholders $ 0.092 MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Our common stock is not currently traded on any exchange. We cannot assure that any market for the shares will develop or be sustained. We have not paid any dividends on our common stock and do not anticipate paying cash dividends in the foreseeable future. We intend to retain any earnings to finance the growth of our business. We cannot assure you that we will ever pay cash dividends. Whether we pay cash dividends in the future will be at the discretion of our Board of Directors and will depend upon our financial condition, results of operations, capital requirements and any other factors that the Board of Directors decides are relevant. See Management s Discussion and Analysis of Financial Condition and Results of Operations. DESCRIPTION OF BUSINESS AND PROPERTY General IXIR Productions, Inc. is a boutique, one-stop-shop record label. Our company is in the business of recruiting music artists, and providing them with worldwide digital distribution, production, music videos, music press relations, online marketing and event promotion. Mr. John Azoulay is the sole officer and director of IXIR Productions, Inc. Since the company s incorporation date (March 19, 2013), John Azoulay has served as the company s President, Director, Secretary, and Treasurer. There is no Board of Directors. IXIR Productions, Inc. is authorized to issue 75,000,000 shares of common stock, at par value $0.001 per share. Pursuant to a Subscription Agreement (dated March 19, 2013) 5,000,000 shares of common stock were sold to John Azoulay, the sole officer and director of the Company, at a purchase price of $0.0025 per share, for aggregate proceeds of $12,500. Our company s business is focused on providing music artists with all of their music production, recording and distribution needs. We currently have minimal revenue, operating history and no music artists but our sole officer and director, Mr. John Azoulay. Our objectives over the 12-month period following successful completion of our Offering are: Launch our corporate website Identify music artists and offer our services Advertising and marketing of our record label and music artists. First, we are planning to launch our corporate website with the funds we receive from our Offering, we have budgeted $1,500 for the design of the website and plan to launch within 2-3 months. We have secured a domain name IXIRproductions.com, but do not have a functioning website yet. We intend to use a free open source content-management system based on PHP and MySQL. Our website will list our services to music artists, provide information about our business and showcase music, tours, photos, videos and a portfolio of our music artists. Once are website is fully functional we will immediately look and engage in recruiting music artists to use our services. We have budgeted $4,500 for this task and expect it to be an ongoing task. Our sole officer and director will be responsible for finding and recruiting music artist. We plan to focus on sites like MySpace, Bandcamp, ReverbNation which music artists use as a platform to show off their work to millions of people. We also intend to use social networks such as Facebook to post messages about our services to music artists. We have already created a Facebook page for our Company https://www.facebook.com/IXIRRecording. Once we identify music artist we will offer our one-stop-shop record label services, we will send out marketing materials including our music demos. Our music demos are also available on https://soundcloud.com/john-azoulay. We have budgeted $20,000 to advertise, market and build brand awareness in the public domain. If we are successful in recruiting music artists we have also budgeted $5,000 to hire an event manager consultant, the role of the event manager is to find, schedule and book live events for the music artists. PRINCIPAL SERVICES Our mission is to provide essential services to music artists including worldwide online distribution, music recording and production, music release, marketing and promotions, online marketing, music videos, and club/DJ promotion. MUSIC RECORDING AND PRODUCTION Our objective is to provide music artists with all of their music production, recording and mixing needs. We will provide high-quality recording services, tailored to the needs of each unique recording artist or group. We can work with soloists, groups, and bands in all musical genres in recording demos, full albums, or singles. Our services range from acoustic recordings to laying down beats . An initial consultation will determine the needs of the artist(s), and the best approach to producing high-quality recordings. Mixing, engineering, and recording will all be done by third-parties. Clients will be provided with high-quality downloadable media files that meet and exceed industry standards. Artists will be charged a flat-rate fee for music production services. Fees will be negotiated during the initial consultation session. Mr. Azoulay produced and released all of the 17 songs that are available for sale. 8 songs out of the 17 were produced and released prior to our incorporation. Mr. Azoulay as the officer of IXIR produced all the songs from creating the music, recording and distributing them via Feiyr for sale. FUTURE SERVICE We plan to expand our services in the future and provide: music video production and recordings/video of live performance. MUSIC RELEASE In order to provide worldwide digital distribution we have partnered with DANCE ALL DAY Musicvertriebs GmbH c/o Feiyr.com an online music distribution company that publishes music worldwide. This company has access to over 300 download shop and music portals, including iTunes , Amazon, Spotify, Google, Beatport, Djshop, Youtube, and many more. Feiyr.com will enable us to manage artists, and to sell and promote their music while retaining complete control of the releases. Each music portal charges a commission rate of 15 35% of gross sales. Feiyr.com takes 20% of the revenue received from music release sales. The remainder goes to IXIR Productions, and the recording artist. For example, a song is sold on iTunes for $0.99. iTunes keeps $0.35, leaving $0.64. Feiyr.com takes 20% of the $0.64, which is $0.13. The remaining $0.51 is released to us. Of the $0.51, IXIR Productions charges 15%, leaving the artist with $0.44. In summary, a $0.99 song would result in $0.08 return for IXIR Productions. There was no written agreement with DANCE ALL DAY, when the company signed up on their website (www.feiyr.com) to use their service we acknowledged and accepted the license agreement which is attached as an exhibit. Material terms: DANCE ALL DAY acts as a digital distributor to our songs and labels, we don't transfer our copyrights and publishing rights to them. They take 20% of the sales. We can terminate our account at any time. The Company does not currently have a functioning website. MARKETING AND PROMOTION SERVICE We will create a professional website for the artists to showcase their music, tours, photos, videos, and band members. The artist or band will also be cross-promoted on our own website to increase exposure to a wider audience range. We will assist the artist or band in setting up accounts and uploading their music on popular online music portals such as Soundcloud, BandCamp, and so forth. These websites enable artists and bands to promote their music to online users, and direct viewers back to the artist s own website. Promotion on Twitter: the artist will be required to create a unique twitter account for the promotion of their music. The artist or band will be asked to create their own list of other users to follow, and through twitter activity will increase their follower-ship as well. Twitter will be used for online promotion to announce new tracks, albums, and to promote online presence. Marketing and promotion service will be included as part of the music production bundle. THE MARKET OPPORTUNITY The Company s main market for its products and services is in the United States. In their 2012 Digital Music Report, the IFPI reported record companies digital revenues for 2012 are estimated at us$ 5.6 billion, up an estimated 9 per cent on 2011 and accounting for more than a third of total industry revenues (34%). digital channels account for the majority of income in an increasing number of markets including India, Norway, Sweden and the US. Download sales increased by 12 per cent in 2012, to 4.3 billion units globally (combining digital singles and albums). digital album sales grew at more than twice the pace of single tracks. there were 2.3 billion single track downloads worldwide, an increase of 8 per cent and 207 million digital albums sold, up 17 per cent on 2011, showing consumer demand for albums remains strong. The Nielsen Company & Billboard s 2012 Industry Report shows overall music sales in the US to have increased 3.1% over 2011. Even though physical musical sales decreased by 12.8% over 2011, digital sales of albums and tracks are on the rise digital albums increased by 14.1%, and digital track sales increased by 5.1%. Despite the growth in digital sales, physical albums were still the dominant album format. Overall music purchases surpassed 1.65 billion units in 2012, an increase of 3.1% since 2011. The American Association for Independent Music, Billboard and SoundScan stats show that independent labels received 32.6% of U.S. album sales in 2012. In 2011, indie labels outpaced all of the other label groups taking the #1 sales spot followed by Universal, Sony, Warner Music and EMI respectively. Our target market includes established artists, as well as up and coming/new independent music artists and bands looking for a one-stop-shop company that can manage music creation, branding, and selling. COMPETITION AND COMPETITIVE STRATEGY The independent music industry is highly competitive and, at times, subject to rapidly changing consumer preferences and industry trends. We compete with a large number of independent record labels, and many of our competitors have longer operating histories, greater financial sales, more experience in marketing, more technological resources, and well-established client bases. However, our services are different in that we offer a one-stop-shop approach. In today s fast-paced environment, this approach has a great appeal to music artists who would rather spend more of their time making music. John Azoulay is a musician himself, and familiar with the process of becoming a successful music artist. His experience enables him to offer a unique expertise that will particularly appeal to a wide range of music artists. MARKETING & SALES STRATEGY RECRUITING NEW TALENT New talent will be sought out on websites such as MySpace, Bandcamp, ReverbNation and other sites that feature unsigned artists. Once promising talent has been identified, they will receive a presentation about our boutique one-stop-shop label, and related services. MARKET AND PROMOTE OUR CURRENT TALENT Until we are able to recruit music artists to use our services, our management is focused on promoting our current sole talent, the Company s director, John Azoulay. Create new music tracks and distribute them via Feiyr.com. Create, and maintain a professional website for our artist, showcasing his music, touring information, photos, and music videos. Book live performance events via our network of events agency, managers of clubs and artistic directors. To demonstrate our music production and distribution capabilities, our sole officer and director, Mr. John Azoulay, had self-produced to date 17 of his own songs which are available for sale on iTunes, Amazon and BeatPort. To date we have generated insignificant revenue from the sales of these songs. Our current active songs for sale: SKU SONG ARTIST GENRE 10045914 Not Alone Feat. Audrey Graham (Extended Mix) John Azoulay House 10048098 Not Alone Feat. Audrey Graham (Radio Edit) John Azoulay House 10070971 T L V (Original Mix) John Azoulay Electro House 10166564 Sight (Original 8'' Edit) John Azoulay Prog-House 10166565 Himo (Original Mix) John Azoulay House 10166566 Organe (Original Mix) John Azoulay Electro 10172462 Spy John Azoulay Deep House 10173719 Intimacy (Original Mix) John Azoulay Prog-House 10173720 Boundless (Original Mix) John Azoulay Prog-House 10202634 Map of Mind John Azoulay Electro House 10202635 Arvy John Azoulay Deep House 10202636 Linch John Azoulay Tech-House 10208044 Exit (Romanito Vocal) John Azoulay Deep House 10208045 People Want John Azoulay Deep House 10208594 Morning Sea John Azoulay Deep House 10212224 In Your Nature (Club Mix) John Azoulay Prog-House 10212225 Burn Out (Club Mix) John Azoulay Tech-House REVENUE MODEL We plan to generate revenue from the following: Music Release - Revenue from the sales of music of our music artists, to date we have a sole music artist, the Company s director, Mr. John Azoulay. Live Performance Revenue from the booking of our music artists, to date we had two customers who booked a live event with our music artist. Employees As of February 28, 2014, we had the Company s work being done by management. We have a single employee, Mr. Azoulay, and he is not a full-time employee, offering only an anticipated 20 hours per month to the company. Description of Property We do not own interests in any real property. Mr. John Azoulay, our President, Treasurer, Secretary and director, has provided us with 400 sq ft of furnished office space located at 4 Rue Santeuil, Nantes 44000, France free of charge for at least the next 12 months. This location currently serves as our primary office for planning and implementing our business plan. This space is currently sufficient for our purposes, and we expect it to be sufficient for the foreseeable future. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion of our financial condition and results of operations should be read in conjunction with (i) our audited financial statements as of June 30, 2013 and unaudited interim financial statements as of December 31, 2013 that appear elsewhere in this registration statement. This registration statement contains certain forward-looking statements and our future operating results could differ materially from those discussed herein. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We disclaim any obligation to update any such factors or to announce publicly the results of any revisions of the forward -looking statements contained herein to reflect future events or developments. For information regarding risk factors that could have a material adverse effect on our business, refer to the Risk Factors section of this prospectus beginning on page 6. Plan of Operation IXIR Productions, Inc. will provide a boutique, one-stop-shop record label. Our Company is in the business of recruiting music artists, and providing them with worldwide digital distribution, production, music videos, music press relations, online marketing and event promotion. Other than the shares offered by this prospectus, no other source of capital has been identified or sought at this time. The amount of cash the Company currently has on hand is sufficient to meet its obligations and conduct planned operations for a minimum of six months or until this filing is effective. If we are only successful in raising 10% of our planned Offering we will not be able fund the cash shortfall to maintain our public reporting obligations, unless we can obtain alternative financing through further equity issuances, debt financing or shareholder loans. We currently have no plans in place to cover the shortfall. If we are able to sell 375,000 shares of our common stock (75% of the Offering) we can maintain our reporting requirements with the SEC and execute our business plan, our marketing efforts will be at a medium level. The above refers to executing our plan as follows: First, we are planning to launch our corporate website with the funds we receive from our Offering, we have budgeted $1,500 for the design of the website and plan to launch within 2-3 months. We have secured a domain name IXIRproductions.com, but do not have a functioning website yet. We intend to use a free open source content-management system based on PHP and MySQL. Our website will list our services to music artists, provide information about our business and showcase music, tours, photos, videos and a portfolio of our music artists. Once are website is fully functional we will immediately look and engage in recruiting music artists to use our services. We have budgeted $4,500 for this task and expect it to be an going task. Our sole officer and director will be responsible for finding and recruiting music artist. We plan to focus on sites like MySpace, Bandcamp, ReverbNation which music artists use as a platform to show off their work to millions of people. We also intend to use social networks such as Facebook to post messages about our services to music artists. We have already created a Facebook page for our Company https://www.facebook.com/IXIRRecording. Once we identify music artist we will offer our one-stop-shop record label services, we will send out marketing materials including our music demos. Our music demos are also available on https://soundcloud.com/john-azoulay. We have budgeted $20,000 to advertise, market and build brand awareness in the public domain. If we are successful in recruiting music artists we have also budgeted $5,000 to hire an event manager consultant, the role of the event manager is to find, schedule and book live events for the music artists. We will be unable to implement any portion of our business plan until we sell at least 250,000 shares of our common stock (50% of the Offering) in this Offering. If we do not sell at least 125,000 shares of our common stock (25% of the Offering) we will not be able to maintain our reporting status with the SEC and remain in good standing with the state of Nevada without additional funds. We currently do not have any arrangements regarding this Offering or following this Offering for further financing and we may not be able to obtain financing when required. Our future is dependent upon our ability to obtain further financing, the successful executing of our business plan, a successful marketing and promotion program, and achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. There are no assurances that we will be able to obtain further funds required for our continued operations. Even if additional financing is available, it may not be available on terms we find favorable. At this time, there are no anticipated sources of additional funds in place. Failure to secure the needed additional financing will have an adverse effect on our ability to remain in business. If we are successful in selling all 500,000 common shares under this Offering, the funds raised are budgeted to sustain operations for a twelve month period following the closing. The net proceeds will be used for our business plan as discussed in the Use of Proceeds section upon receipt of the first proceeds received from the raise. Release of the funds to the Company is based upon our counsel, Law Offices of Harold P. Gewerter, Esq. Ltd., reviewing the records of the depository institution holding the deposit to verify that that the checks have cleared prior to releasing the funds to the Company. In all instances, after the effectiveness of the registration statement of which this prospectus is a part, we will require some amount of working capital to maintain our basic operations and comply with our public reporting obligations. In addition to changing our allocation of cash because of the amount of proceeds received, we may change the use of proceeds because of changes in our business plan. Investors should understand that we have wide discretion over the use of proceeds. Our sole officer and director has little knowledge of U.S. GAAP and no audit committee to assist him which may result in untimely or unreliable financial statements. The Company is an emerging growth company under the Jumpstart Our Business Startups Act. The Company shall continue to be deemed an emerging growth company until one of the following conditions are met; either the Company has total gross revenues of $1,000,000,000 at the end of a fiscal year, or the last day of the fifth anniversary date of the first sale of common equity securities pursuant to an effective registration statement, or the three year anniversary date where the Company issued more than 1,000,000,000 in non-convertible debt, or the date which the Company is deemed to be a large accelerated filer and means that the Company has a public float over $700,000,000. As an emerging growth company the Company is exempt from Section 404(b) of Sarbanes Oxley. Section 404(b) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company the Company is exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. An emerging growth company is not required to: comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive s compensation to median employee compensation. publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting which statement shall also assess the effectiveness of such internal controls and procedures. The Company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. Given the opt out, the Company will be required to have its auditors attest to and report on management s assessment of its internal controls, have shareholder approval of executive compensation every three years including golden parachutes. The Company will have to comply with all new or revised accounting standards upon adoption as added. The trends of the industry are reflective of the economic atmosphere that the country finds itself in and will continue to be affected by the overall economic condition of the United States in the future. The wide diversification of the record labels and customers seeking the product and services owned by our Company will determine the direction and the amount of attention given to any one area at any given time depending on the demands of the industry at that time and in the future. Liquidity and Capital Resources At December 31, 2013 we had $11,197 in current assets. Current liabilities at December 31, 2013 was nil. At June 30, 2013 we had $12,500 in current assets and $81 in current liabilities. At December 31, 2013, we had current assets consisting of $3,500 in cash, $6,500 in deferred equity issuance costs and $1,197 due from stockholder. At June 30, 2013, we had current assets consisting of $6,000 in cash and $6,500 in deferred equity issuance costs. We have no material commitments for the next twelve months. We will however require additional capital to meet our liquidity needs. Currently, the Company has determined that its anticipated monthly cash flow needs should not exceed of $12,000 for the first 6 months. In order to achieve our stated business plan goals, we require the funding from this offering. We are a development stage company and have not generated significant revenue to date. We cannot guarantee that we will be able to sell all the shares required. If we are successful, any money raised will be applied to the items set forth in the Use of Proceeds section of this prospectus. Even if we are successful in raising all of the funding under this Offering, we will still not be in a position to generate any significant revenues or become profitable. We still must raise significant additional funding to continue with our business. The Offering is only sufficient to enable us to design and launch our website, branding, identify potential music artist and offer our services. Even if we are successful in raising all of the funding under this Offering we have only budgeted $20,000 for advertising and promotion, which might not be sufficient to build brand awareness in the public domain. We believe we will require an additional $40,000 for advertising and promotion expenses and $30,000 to hire an event manager consultant for a period of 6 months to assist us promote our music artists. Results of Operations From March 19, 2013 (inception) to December 31, 2013, the Company had sales of $6,303 from three customers. Mr. Azoulay was booked as the DJ and provided live music events for the 3 customers. Cost of sales for the period ended December 31, 2013 was $4,426 all of which were fees for services incurred with our sole officer. Gross profit for the period ended December 31, 2013 was $1,877. From March 19, 2013 (inception) to December 31, 2013 we incurred operating expenses of $680 for our organization fees which include incorporation and registered agent fees and $2,500 in accounting and auditing fees. As a result, we have reported a net loss of $1,303 for the period ended December 31, 2013. From March 19, 2013 (inception) to June 30, 2013, the Company had sales of $2,044 from two customers. Mr. Azoulay was booked as the DJ and provided live music events for the 2 customers. Cost of sales for the period ended June 30, 2013 was $1,455 all of which were fees for services incurred with our sole officer. Gross profit for the period ended June 30, 2013 was $599. During the period ended June 30, 2013 we incurred operating expenses of $680 for our organization fees which include incorporation and registered agent fees. As a result, we have reported a net loss of $81 for the period ended June 30, 2013. The Company s revenues are expected to be derived primarily from services to music artist such production, recording, distribution and live performance booking fees. The Company has suffered operating losses since its inception, primarily as a result of accounting and auditing fees and organization costs. Going Concern The future of our company is dependent upon its ability to obtain financing and upon future profitable operations. Management has plans to seek additional capital through a private placement and public offering of its common stock if necessary. These conditions raise substantial doubt about our company's ability to continue as a going concern. Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. Critical Accounting Policies Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management. Cash and Cash Equivalents. The Company considers all highly liquid short-term investments with maturities of less than three months when acquired to be cash equivalents. Revenue Recognition. The Company recognizes revenue when all four of the following criteria are met: (i) persuasive evidence that an arrangement exists; (ii) delivery of the products and/or services has occurred; (iii) the fees earned can be readily determined; and (iv) collectability of the fees is reasonably assured. The Company recognizes revenue as services are performed under the agreements. OUR MANAGEMENT Directors, Executive Officers, Promoters and Control Persons Directors, Executive Officers Name Age Position John Azoulay 31 Chairman of the Board, President Secretary, Treasurer, Director Mr. John Azoulay, President, CEO, Secretary Treasurer and Member of the Board of Directors Mr. Azoulay has been serving as our President, Secretary, Treasurer and Director since March 19, 2013. The term of his office is for one year and is renewable on an annual basis. During 2008 to 2010, He has acted as the Events Executive at the Casino Barri re of Toulouse, France. The casino belongs to Groupe Lucien Barri re which is the casino market leader in France and in Switzerland. His duties included soliciting new business and producing revenue growth, publicizing the events, booking locations, halls and equipment and working with artists and other entertainers. Since 2011 to January 2013, he was a partner and the General Manager of Room157 of Toulouse, France, a nightclub and a restaurant. He was responsible for the nightclub and restaurant, including financial, driving sales and profitability to meet targets. He was overseeing all aspects of the operations of the club and restaurant. These experiences, qualifications and attributes have led to our conclusion that Mr. Azoulay should be serving as a member of our Board of Directors in light of our business and structure. Our officer will devote approximately 20 hours per month to the company. Family Relationships. There are no family relationships among the directors and executive officers of the Company. Code of Conduct and Ethics. We have adopted a code of business conduct and ethics that applies to our director, officers and all employees. The code of business conduct and ethics may be obtained free of charge by writing to IXIR Productions, Inc., Attn: Chief Financial Officer, 4 Rue Santeuil, Nantes 44000, France. Executive Compensation Summary Compensation Table. The following table sets forth certain information concerning the annual and long-term compensation of our Chief Executive Officer and our other executive officers during the period from March 19, 2013 (Inception) through June 30, 2013. Name and Principal Position Year Salary Bonus Option Awards All Other Compensation (1) Total Compensation John Azoulay 2013 $0 $0 $0 $1,455 $0 Chairman of the Board, CEO President, CFO, Sec. Treas. Dir. (1)Represents amounts incurred for services provided by Mr. Azoulay directlyrelated to the Company s revenues. Outstanding Equity Awards at Fiscal Year End. There were no outstanding equity awards as of February 28, 2014. Compensation of Non-Employee Directors. We currently have no non-employee directors and no compensation was paid to non-employee directors in the period ended December 31, 2013. We intend during 2013 to identify qualified candidates to serve on the Board of Directors and to develop a compensation package to offer to members of the Board of Directors and its Committees. Audit, Compensation and Nominating Committees As noted above, we intend to apply for listing our common stock on the OTC Electronic Bulletin Board, which does not require companies to maintain audit, compensation or nominating committees. Considering the fact that we are an early stage company, we do not maintain standing audit, compensation or nominating committees. The functions typically associated with these committees are performed by the entire Board of Directors which currently consists of one member who is not considered independent. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Security Ownership of Principal Stockholders, Directors, Nominees and Executive Officers and Related Stockholder Matters The following table sets forth, as of February 28, 2014, certain information with respect to the beneficial ownership of shares of our common stock by: (i) each person known to us to be the beneficial owner of more than 5 percent of our outstanding shares of common stock, (ii) each director or nominee for director of our Company, (iii) each of the executives, and (iv) our directors and executive officers as a group. Unless otherwise indicated, the address of each shareholder is c/o our company at our principal office address: Beneficial Owner Number of Shares Beneficially Owned (*) Percent of Class (**) Percent of Class after offering John Azoulay 5,000,000 100% 91% All directors and officers as a group 5,000,000 100% 91% (1 person) (*) Beneficial ownership is determined in accordance with the rules of the SEC which generally attribute beneficial ownership of securities to persons who possess sole or shared voting power and/or investment power with respect to those securities. Unless otherwise indicated, voting and investment power are exercised solely by the person named above or shared with members of such person s household. (**) Percent of class is calculated on the basis of the number of shares outstanding on September 6,2013 (5,000,000). CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS It is our practice and policy to comply with all applicable laws, rules and regulations regarding related person transactions, including the Sarbanes-Oxley Act of 2002. A related person is an executive officer, director or more than 5% stockholder of IXIR Productions, Inc., including any immediate family members, and any entity owned or controlled by such persons. Our sole director and officer is charged with reviewing and approving all related-person transactions., In considering related-person transactions, our Board of Directors takes into account all relevant available facts and circumstances. On March 19, 2013 our officer and director received 5,000,000 shares at $0.0025 per share for cash. These shares were exempt from registration under Section 4(2) of the Securities Act of 1933 as there was no solicitation and both officers and directors were in possession of full information about the registrant. 100% of the Company s sales related expenses, totaling $4,426 were incurred with our sole officer and director. Director Independence Our Board of Directors has adopted the definition of independence as described under the Sarbanes Oxley Act of 2002 (Sarbanes-Oxley) Section 301, Rule 10A-3 under the Securities Exchange Act of 1934 (the Exchange Act) and NASDAQ Rules 4200 and 4350. Our Board of Directors has determined that its sole member does not meet the independence requirements. DESCRIPTION OF CAPITAL STOCK Authorized and Issued Stock Number of Shares at February 28, 2014 Title of Class Authorized Outstanding Common stock, $0.001 par value per share 75,000,000 5,000,000 Common stock Dividends. Each share of common stock is entitled to receive an equal dividend, if one is declared, which is unlikely. We have never paid dividends on our common stock and do not intend to do so in the foreseeable future. We intend to retain any future earnings
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001584104_x-treme_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001584104_x-treme_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2d9a4ea981fdd27ffd8a473ccf1051fe1c08637f
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001584104_x-treme_prospectus_summary.txt
@@ -0,0 +1,203 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights information described more fully elsewhere in this prospectus. You should read the entire prospectus carefully.
+In this prospectus, "X-Treme Investments," "we," "us" and "our" refer to X-Treme
+Investments, Inc., a Nevada corporation.
+
+ 
+
+The
+Company
+
+ 
+
+X-Treme Investments,
+Inc. is a development stage company incorporated in the State of Nevada on February 21, 2013. Our principal business objective
+is to develop and operate a consulting company that provides a full range of site selection, planning, development and management
+services for prospective residential and commercial income producing real estate investments. Since our incorporation, we have
+had only one employee and no revenues from operations and have a loss of $33,906 from February 21, 2013 (inception) through
+June 30, 2014. See "Business." We have not yet secured a commitment for financing to implement our business
+plan. Initial growth may be very limited and based solely on compensation from consulting assignments with no guarantee of obtaining
+any such assignments over the next 12 months. We intend to begin identifying prospective projects and clients through the client
+networks of Anthony Passmore, our chief executive officer and principal shareholder, once we obtain sufficient working capital
+to finance our operations. Internally generated funds, alone, will not be sufficient to implement our business plan. Through the
+date of this prospectus, Mr. Passmore has funded our working capital requirements by contributing cash to the company as additional
+capital. Mr. Passmore intends to continue to fund our working capital needs through cash contributions to our capital through
+the date of this prospectus. Although Mr. Passmore has agreed to pay the expenses of this offering without being reimbursed by
+the Company, Mr. Passmore may lend us funds, payable on demand without interest, to operate our business until such time as we
+are able to raise capital or generate income. If Mr. Passmore is unable or unwilling to provide us with the funds that we need
+to operate our proposed business or we are unable to raise capital either through debt or equity, our business will most likely
+fail.
+
+ 
+
+X-Treme Investments
+principal mission will be to create value for its clients by adhering to disciplined financial principals for the acquisition
+and development of residential and commercial incoming producing real estate and their operations. We intend to focus our efforts
+in the Midwest and Southern regions of the United States. Our strength will be derived through our ability to provide a full range
+of specialized in-house services including site selection, planning, development, and management. Our ability to identify suitable
+projects, as well as to attract new clients will give us a significant competitive edge within the field. Maintaining development
+as a specialized in-house function will allow us to move quickly when the situation warrants. Our prospective in-house consulting
+services will offer a complete range of matters; from working directly with the brokers, contractors to dealing with regulatory
+mandates. Our in-house services will examine a prospective project to determine opportunities to increase income, cut cost, and
+improve efficiencies. We will employ an active hands-on management style. Marketing, pricing, community relations, amenities,
+and other issues will be carefully studied to ensure operations remain on track. We hope to achieve economies of scale to reduce
+operating costs and benchmark performance ratings will be applied across the properties we evaluate to maintain quality. We will
+operate using a proven evaluation process based on our own database of marketing information and research capabilities. Location,
+income, cost structure, and management practices will be viewed to arrive at the asset s potential. X-Treme Investments
+will position itself for the long-term and as a result, we will be in position to provide our investors with long-term value for
+their investment.
+
+ 
+
+X-Treme Investments
+understands the nature of the ever-developing real estate industry. All properties or assets that we identify as suitable for
+acquisition by our clients are expected to be profitable or have potential for profits. Although primarily focused in the Midwest
+and Southern regions of the United States, we will consider evaluating investments in other economically and demographically desirable
+markets. Investments in other target markets will be evaluated where strong relationships with the local community are present
+and an available mass of other properties can be quickly acquired in order to achieve expected economies of scale. If we are able
+to expand, we plan to target the Northeastern and Southeastern regions of the United States as we believe these markets provide
+excellent opportunities.
+
+ 
+
+Investment
+Criteria
+
+ 
+
+As part of
+our consulting services, we will apply the following investment criteria in the evaluation of properties our clients seek to acquire:
+
+ 
+
+Property
+Type. X-Treme Investments will seek to identify assets that have superior
+location and or have upside potential.
+
+ 
+
+ 1
+
+ 
+
+ 
+
+ 
+
+Development.
+X-Treme Investments will develop a comprehensive program that will provide for responsible development in markets where demand
+is strong for new product. Taking calculated risks to generate higher yield, we will identify opportunities that will complement
+the acquisition portfolio of our clients.
+
+ 
+
+Economics.
+We will target an attractive internal rate of return that depends upon the location and quality of the asset and the opportunity
+to enhance yield through diligent and efficient management. Each asset will be evaluated for its potential to provide a high un-leverage
+return within its holding period.
+
+ 
+
+Business
+Strategy
+
+ 
+
+Our primary
+business strategy is the identification of quality investments for our clients that provide stable initial returns with the opportunity
+to enhance yields through diligent and efficient management and comprehensive operational strategies. Investment focus on properties
+we evaluate will be geared towards their acquisition at a discount to replacement cost or development with strategic timing and
+providing high return on investment. The properties we identify will consist of assets which we believe can also achieve sustainable
+growth in cash flow. In the course of our evaluation, we will take into account fundamental trends in underlying property markets
+as determined by proprietary models, site visits, cash flow growth, stability and other factors we may determine from time to
+time to be relevant.
+
+ 
+
+We believe
+we are not a blank check company because we have no plans or intentions to engage in a merger or acquisition with an unidentified
+company or person or, once we are a reporting company, to be used as a vehicle for a private company to become a reporting company.
+Rule 419 defines a "blank check company" as a company that: (1) is a development stage company that has no specific
+business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified
+company or companies, or other entity or person; and (2) is issuing "penny stock," as defined in Rule 3a51-1 under
+the Securities Exchange Act of 1934.
+
+ 
+
+As
+described herein, we have a very specific business purpose and a bona fide plan of operations. Our business plan and purpose is
+the acquisition and development of real estate investments for our clients and operation of companies and businesses involved
+primarily in the resurgent real estate industry. Although we may acquire companies that provide consulting services and engage
+in operations similar to our objectives, our business plan is not to engage in a merger or acquisition with an unidentified company
+or companies, unless such company would further our mission as set forth above and herein. Furthermore, we do not have plans to
+make any investments in any companies in general that would result in our company being a majority-owned subsidiary
+of another entity through a transaction referred to as a reverse merger. As noted above, however, we would consider a merger
+or acquisition with a company that provides consulting services and engages in operations similar to our objectives although we
+have no present plans to do so. 
+
+ 
+
+Our principal
+executive offices are located at 1401 West Fort Street, P.O. Box No. 311082, Detroit, Michigan 48231, telephone (248)773-1601.
+Our email address is xtremeinvestmentsinc@gmail.com.
+
+ 
+
+We have an
+Internet website at www.x-tremeinvestments.com. Any information which may be contained in our website shall not constitute part
+of this prospectus.
+
+ 
+
+The
+Offering
+
+ 
+
+This
+prospectus relates to the registration and offering of up to 100,000,000 shares of the common stock of X-Treme Investments, Inc.,
+a Nevada corporation, $0.0001 par value per share. Please refer to "Plan of Distribution."
+
+ 
+
+We
+will bear all expenses in connection with the registration of all of the shares of our common stock covered by this prospectus.
+We are offering the shares of our common stock without the use of any placement agent. Our fees and expenses associated with this
+offering are estimated to be $43,702, all of which will be paid by Anthony Passmore, our principal shareholder and sole
+officer and director. Mr. Passmore will not be reimbursed for any expenses paid by him in connection with this offering. See "Use
+of Proceeds."
+
+ 
+
+Anthony
+Passmore is deemed to be an "underwriter" within the meaning of the Securities Act of 1933, as amended, with respect
+to the securities offered hereby, and any profits realized or commissions received may be deemed underwriting compensation.
+
+ 
+
+The
+offering price per share is $0.001. There will be no commissions paid in connection with
+the sale of our shares as described in this prospectus. Please refer to "Plan of Distribution" beginning on page 33
+of this prospectus. The shares of our common stock are not currently listed for sale on any exchange, although we do plan to attempt
+to have our shares quoted for sale on the OTCQB or the OTC Bulletin Board (the "OTCBB") after the effective date of
+this prospectus. However, there can be no assurance that we will be successful in having our shares quoted or traded on any public
+market.
+
+ 
+
+X-Treme
+Investments has no present plans to be acquired or to merge with another company, nor does X-Treme Investments or Mr. Passmore
+have plans to enter into a change of control or similar transaction. However, as indicated in this prospectus, Anthony Passmore,
+our sole officer and director, owns directly and indirectly, 70,000,000 shares of our common stock which equates to 100 percent
+of our common stock, as of the date of this prospectus. The voting rights of the 60,000,000 shares of our common stock owned by
+Mr. Passmore, and the 10,000,000 shares of our common stock owned through Mr. Passmore s affiliate, Passmore Management
+Group, will provide Mr. Passmore with voting rights equal to 70,000,000 shares of our common stock, which amount will equal 41
+percent of the outstanding shares of our common stock, if all 100,000,000 of the shares offered by this prospectus are sold. As
+a result, Mr. Passmore may have the power to enter into a change of control or similar transaction with respect to X-Treme Investments,
+with the concurrence of only 10 percent of our other stockholders, if all 100,000,000 of the shares offered by this prospectus
+are sold. See "
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001584489_house-of_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001584489_house-of_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..fd8d4ab35232d400dc7fbc6cb0d0ddbcfb97aa04
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001584489_house-of_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained in other parts of this Prospectus and provides an overview of the material aspects of this offering. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire Prospectus carefully, including the risks discussed under "Risk Factors," our financial statements and the related notes included in this prospectus and "Management's Discussion and Analysis of Financial Condition and Results of Operations." House of BODS Fitness, Inc. House of BODS Fitness, Inc. (the Company, HOB, we, our, or us ) was incorporated in the State of Delaware on October 13, 2010. On October 21, 2010, we acquired BODS Transcending Company ("BODT"). BODT was incorporated in the State of Florida, on September 10, 2007. In November of 2007, BODT opened a dance fitness studio located at 1061 South Sun Drive Suite #1097, Lake Mary, Florida 32746. This dance studio subsequently closed in November 2013. All of HOB's business operations to date have been conducted by our subsidiary, BODT, and, as a result, unless otherwise indicated, all references to the Company and its operations relate to BODT. Our revenue was $3,123 for the nine months ended September 30, 2014 and was $29,549 for the year ended December 31, 2013. Our net losses were $17,183 for the nine months ended September 30, 2014 and were $53,581 for the year ended December 31, 2013. The implied aggregate value of the outstanding stock after this Offering, based on the assumed offering price of $.15 will be $3,410,500. The total stockholders deficit as of the latest balance sheet date, September 30, 2014, is $473.00. The Company has recently focused on training and business development and therefore does not presently have any dance studios open. Ms. Tammy Skalko continues to provide four clients with private training sessions in their homes. These clients each average two sessions per week at $20-25 per session. The Company counts a client as any individual who has purchased at least one class or personal training session. The Company is currently looking for a suitable site to lease or purchase to resume dance classes and to increase the number of training sessions offered. We anticipate the site selection and contract to be in place 60-120 days from October 1, 2014. The Company intends to resume classes and increase personal training sessions within 30 days of a signed contract. Clients will be able to purchase a package of either six sessions/classes for $240 or 12 sessions/classes for $420. There is no monthly membership option for studio classes and personal training sessions. The Company has only one full time employee, Ms. Tammy Skalko. Our fitness program, created for women, works out body and mind elevating the spirit while burning calories. The mantra of anything is possible if you believe baby runs through the program and sweat yourself sexy is one of the many tenants of the fun dance sessions encompassing our fitness program. Our new approach to exercise, making exercise fun through dance, TRX training, and kickboxing takes the bore and lack of motivation out of traditional exercising and entices the audience with flirty, fun, and sexy moves that keep them wanting more. Our program creates a style of exercise that captivates our participants in such a way that it keeps them moving. Our fun atmosphere motivates the individual to keep going, while benefiting from the exercise. Emerging Growth Company We are an Emerging Growth Company as defined in the Jumpstart Our Business Start-ups Act. We shall continue to be deemed an emerging growth company until the earliest of: (A) the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; (B) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title; (C) the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or (D) the date on which such issuer is deemed to be a 'large accelerated filer', as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto. As an emerging growth company, we are exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company, we are exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. For so long as we are an emerging growth company, we will be permitted to provide the scaled executive compensation disclosure applicable to smaller reporting companies even if we no longer qualify as a smaller reporting company. In addition, as an emerging growth company, we are exempt from PCAOB rules regarding mandatory firm rotation or the auditor reporting model. The Company is considered a development stage company. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying consolidated financial statement, the Company has an accumulated deficit of $254,110 as of September 30, 2014 and has $7,246 cash on hand as of September 30, 2014. The Company's monthly "burn rate" pre-offering has currently been $1,000 - $3,000 and the average post-offering burn rate is contemplated to be $20,000 to $25,000 monthly. The post-offering general operating monthly burn rate will increase as the Company begins to implement our proposed business plan. Initially, the burn rate will include the increased legal and accounting costs associated with becoming a public company, consulting fees, rent, travel, advertising, office expense, postage, printing, repairs and maintenance, taxes, license, telephone, and utilities. Depending upon the monies raised in this Offering, the Company also expects to spend an additional $21,000 to $83,000 per month to implement our Use of Proceeds as described on page 20. The ability of the Company to continue as a going concern is in doubt and dependent upon achieving a profitable level of operations or on the ability of the Company to obtain necessary financing to fund ongoing operations. Management believes that its current and future plans enable it to continue as a going concern for the next twelve months due to our ability to issue debt and equity securities, seek strategic partners and our current proposal to initiate additional revenue streams through our dance fitness DVD, the opening of a new studio, and our online community membership fees. To meet our objectives, the Company continues to raise additional working capital through the private placement of our common stock in order to support existing operations and expand the range and scope of its business. However, there are no assurances that we will be successful through the private placement of our securities on acceptable terms and in a timely manner, if at all. We have no formal, binding commitments for funding from debt and equity securities. There is no assurance that we will obtain strategic partners or be able to generate sufficient additional revenue through the sources identified above. The failure to obtain the necessary working capital would have a material adverse effect on the business prospects and, depending upon the shortfall, the Company may have to curtail or cease its operations. The accompanying consolidated financial statements do not include any adjustment to the recorded assets or liabilities that might be necessary should the Company have to curtail operations or be unable to continue in existence.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001586527_starpoint_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001586527_starpoint_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..c5f0ed47ff8e7345c0bec2433515cda14dab551a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001586527_starpoint_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary The following summary highlights selected information contained in this prospectus. This summary does not contain all the information that may be important to you. You should read the more detailed information contained in this prospectus, including but not limited to, the Risk Factors beginning on page 7. References to "we," "us," "our," "Starpoint," or the "Company" refers to Starpoint General Corporation unless the context indicates another meaning. Our Company Starpoint General Corporation was incorporated in the State of Nevada, United States of America, on June 28, 2013. Its fiscal year end is December 31. Our principal executive offices are located at 102 Montauk Blvd., PO Box 86, c/o David Cohen, East Hampton, NY, and our telephone number is (631) 604-1039. We are not a blank check company, and have no intentions of entering into any business combination. We are a corporate advisory firm, providing strategic advice to growth companies in emerging markets. Utilizing Starpoint management s knowledge of financial markets Starpoint provides strategic advice, design and implementation of corporate restructuring plans . As of March 31, 201 4 , we have generated $ 24,153 i n revenues in exchange for consulting services rendered. Operating expenses during the same period totaled $8,980, resulting in operating income of $ 15,173 . We are a newly formed company with no history of active operations, which raises substantial doubt about our ability to continue as a going concern. Consequently, until we implement our planned, principal activities and exit the development stage, we will continue to depend on additional financing in order to maintain our operations and continue with our corporate activities. The $ 24,153 in revenues we generated as of March 3 1, 201 4 was received in the form of shares of a client s common stock. However, accepting shares of stock as payment is not part of the Registrant s business plan, and the Registrant has no current intention of accepting stock of clients in exchange for consulting services as part of the Registrant s future business. Based on these uncertainties, our independent auditors included additional comments in their report on our financial statements for the period ended December 31, 2013, and the period from inception (June 28, 2013) to March 31, 2014 , indicating substantial doubt about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that led to the going concern disclosure by our independent auditors. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. This Offering and any investment in our common stock involve a high degree of risk. If we are unable to generate significant revenue, we may be obliged to cease business operations due to lack of funds. We face many challenges to continue operations, including our lack of operating history, lack of revenues to date, and the losses we have incurred to date. Emerging Growth Company Status We are an emerging growth company as defined in the JOBS Act, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We could be an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. Please see Risk Factors for various risks associated with investing in an emerging growth company like us. The Offering Following is a brief summary of this offering: Securities being offered Up to 8,000,000 shares of common stock are offered by the Company, par value $0.001 Minimum There is no minimum to this Offering Offering price per share $0.004 per share Offering period The shares are being offered for a period not to exceed 180 days Net proceeds to us Approximately $24,000 assuming the entire 8,000,000 shares are sold. Use of proceeds We will use the proceeds to fund the implementation of our business plan. Number of shares outstanding before the offering 10,000,000 Number of shares outstanding after the offering if all of the shares are sold 18,000,000 Summary of Financial Information The following summary financial information for the periods stated summarizes certain information from our financial statements included elsewhere in this prospectus. You should read this information in conjunction with Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements and the related notes thereto included elsewhere in this prospectus. Balance Sheet As of March 31, 2014 Total Assets $ 69,903 Total Liabilities $ 17,882 Stockholder s Equity $ 52,021 Operating Data June 28, 2013 (inception) to March 31, 2014 Revenue $ 7,876 Net Income $ 2,604 Net Income per share $ 0.0002604 As shown in the financial statements accompanying this prospectus, the Company has earned $ 7,876 in revenues as of March 31, 2014 , and has experienced an operating gain in the amount of $ 2,604 . The Company has had a limited history of operations and has been issued a going concern opinion from our auditors based upon the fact that the Company is a newly formed company with no history of active operations. Furthermore, until we implement our planned, principal activities and exit the development stage, we will remain dependent on the sale of equity, issuance of debt, or both which may be insufficient to fund capital expenditures, working capital and other cash requirements for the next 12 months.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001587755_intrawest_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001587755_intrawest_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001587755_intrawest_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001589919_premier_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001589919_premier_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..ee3dcb34bbfc2542a521b7e9420c9ec266e71d80
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001589919_premier_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in the common stock. You should carefully read the entire prospectus, including Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and the Financial Statements, before making an investment decision. In this Prospectus, the terms Premier Pacific Construction, Company, we, us and our refer to Premier Pacific Construction, Inc., a Nevada corporation. Overview We were incorporated on March 14, 2012 in the State of Nevada. In March 2012, we completed a merger with Premier Pacific Construction, Inc., a California corporation ( PPC-CA ). PPC-CA was originally formed in 2000 by our President, Richard Francella to provide general contracting and construction services within San Diego County, California. Since our inception, we have operated as a construction company providing general contracting and construction services to both residential and commercial clients. Our plan is to continue to provide general contracting and construction services as we have done for more than a decade. In addition, we are also pursuing opportunities to work with homeowners who wish to sell their homes in the currently weak real estate market and wish to make certain renovations and upgrades to increase their potential sales price. In order to assist the homeowners, we will complete the renovations and upgrades (hereinafter pre-sale renovation and upgrade services ) with no up-front out of pocket costs to the homeowner. Rather, the homeowner will agree to pay for our services through escrow when they sell. We plan to market our services to real estate brokers. We have not yet begun marketing our pre-sale renovation and upgrade services to real estate brokers and have expended zero funds on marketing our pre-sale renovation and upgrade services to date. We have only established a few business relationships with real estate brokers in San Diego County. Our current lack of assets and no plan for obtaining additional funding may preclude our ability to execute on our business plan. The Company will most likely require additional funding for development and this additional funding may be raised through debt or equity offerings. Management has yet to decide what type of offering the Company will use or how much capital the Company will attempt to obtain and there is no guarantee that the Company will be able to raise any capital through any type of offerings. For these reasons, our auditor has expressed substantial doubt about our ability to continue as a going concern. We are pursuing public company status at this time, because we believe that this will provide us with greater access to capital, that we will become better known, and be able to obtain financing more easily in the future if investor interest in our business grows enough to sustain a secondary trading market in our securities. Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described in the section entitled Risk Factors beginning on page 2 below, together with all of the other information in this prospectus, including the consolidated financial statements and the related notes included elsewhere in this prospectus, before deciding whether to invest in shares of our common stock. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business. If any of the following risks actually occurs, our business, financial condition, results of operations, and future prospects could be materially and adversely affected. In that event, the market price of our common stock could decline, and you could lose part or all of your investment. Where You Can Find Us Our principal executive office is located at 13103 Golden Way, Poway, CA 92064, and our telephone number is (858) 748-7152. Table of Contents If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b2 of the Exchange Act. Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company x (Do not check if a smaller reporting company) Calculation of Registration Fee Title of Each Class of Securities to be Registered Amount to be Registered Proposed Maximum Offering Price Per Unit Proposed Maximum Aggregate Offering Price Amount of Registration Fee (1) COMMON 286,000 $0.10 $28,600 $3.68 (1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(a) under the Securities Act of 1933, as amended. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SUCH SECTION 8(a), MAY DETERMINE. Table of Contents The Offering Common stock offered by selling security holders 286,000 shares of common stock. This number represents 22% of our current outstanding common stock (1). Common stock outstanding before the offering 1,286,000 common shares as of August 21 , 2014. Common stock outstanding after the offering 1,286,000 shares. Use of proceeds We are not selling any shares of the common stock covered by this prospectus. Risk Factors The common stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See Risk Factors beginning on page 2. (1) Based on 1,286,000 shares of common stock outstanding as of August 21 , 2014.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001590301_adrenaline_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001590301_adrenaline_prospectus_summary.txt
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--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The Company Our Business The Company was incorporated in the State of Wyoming on October 9, 2012, with the name Adrenaline Ventures, Inc. We are a development stage company. We are in the business of developing on-site website analytical software designed to capture customer's behavior and customer's feedback on the visited web sites. This behavior and feedback will be analyzed and compared against key performance indicators, like marketing, in terms of a commercial context. We also plan to develop an analytical service process which will compare and rank different websites within different categories of websites based on a customer experience and likeness of the websites visited. The behavior analysis and the ranking results will be submitted to website owners to optimize and improve their websites. Our revenue will be earned by charging a fee for our services. We may also receive commissions from other on-site website analytical companies to which we will refer our potential clients. We are currently developing a website (www.adrenalineventures.net) which will include a detailed description of our services. The website will allow our potential clients to have a 3 month trial period with the ability to place orders online. To date, we have developed a business plan and registered the domain name www.adrenalineventures.net for our new website. As of the date of this prospectus, we have not developed or sold any of our software or other products nor have we generated any revenue from operations. Our operations to date have been devoted primarily to start-up and development activities. Our President, Peter McWilliams, has performed all of those activities to date, which include the following: Formation of the Company Development of our business plan Development of initial software design and structure Research on major marketing methods/strategies Secured web site domain www.adrenalineventures.net research on user demographics We will attempt to become completely operational and anticipate sales to begin during the third quarter of operations following the completion of this offering. In order to generate revenues, we must address the following areas: Finalize and implement our marketing plan: In order to effectively penetrate our targeted market, we will use a multi-faceted and long-term marketing plan that includes a high-end website, and specific distribution channels using independent representatives. Long-term, independent commissioned sales representatives will work as middlemen between us and any potential websites that wish to offer our products. Their responsibilities would include attending trade shows and utilizing creative marketing techniques to attract websites to offer and use our products. Our long term marketing plan is entirely dependent on future financing and, thus, may not occur. We currently, do not have any engagements, agreements, or contracts with independent commissioned sales representatives. THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE COMPANY MAY NOT SELL ITS SECURITIES UNTIL THE REGISTRATION STATEMENT OF WHICH THIS PROSPECTUS IS A PART AND FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE OF THESE SECURITIES IS NOT PERMITTED. PRELIMINARY PROSPECTUS Dated January 28, 2014 ADRENALINE VENTURES, INC. 4,000,000 Shares of Common Stock $0.015 per share Adrenaline Ventures, Inc. ("our", "we", "us" the "Company) is offering on a best-efforts basis of as many as 4,000,000 shares of its common stock at a price of $0.015 per share. This is the initial offering of our common stock, and no public market exists for the securities being offered. The Company is offering those shares on a "self-underwritten", best-efforts, basis directly by our officer and director. There is no minimum number of shares required to be purchased by any investor. Peter McWilliams, our sole officer and director, intends to sell those shares directly. No commission or other compensation related to the sale of those shares will be paid to Mr. McWilliams or any other person. The intended methods of communication regarding the offer and sale of those shares include, without limitation, telephone and personal contact. Our selling efforts will not include any mass media methods, such as Internet or print media. There can be no assurance that all, or any, of the shares offered will be sold. The offering shall terminate on the earlier of (i) the date when the sale of all 4,000,000 shares is completed or (ii) one hundred and eighty (180) days from the effective date the registration statement of which this prospectus is a part. We are a development stage, start-up company. Any investment in the shares offered herein involves significant risks. You should only purchase shares if you can afford a complete loss of your investment. We may not sell all 4,000,000 shares offered. There is no minimum number of shares we must sell before we can utilize the proceeds from the purchase of shares. If we do not sell all 4,000,000 shares within the offering period (180 days), we will close the offering and subscription funds will not be returned to subscribers. In the event we do not sell all 4,000,000 shares offered, the amount of money we receive from the sale of those shares which are, in fact, purchased be minimal and may not be enough to even pay the costs of this offering. Funds from this offering will be deposited in our corporate bank account in our name. As a result, if we are sued for any reason and a judgment is rendered against us, investors subscriptions could be seized in a garnishment proceeding and investors could lose their investments. Investors do not have the right to withdraw invested funds. For more information, see the sections titled "PLAN OF DISTRIBUTION" and "USE OF PROCEEDS" herein. We qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act, which became law in April, 2012 and will be subject to reduced public company reporting requirements. See "Jumpstart Our Business Startups Act" specified herein. We are considered a "shell company" under applicable securities rules and subject to additional regulatory requirements as a result, including the inability of our shareholders to sell our shares in reliance on Rule 144 promulgated pursuant to the Securities Act of 1933, as well as additional restrictions. Accordingly, investors should consider our shares to be significantly risky and illiquid investments. Refer to the section entitled "RISK FACTORS" beginning on Page 5. As of the date of this prospectus, we have not developed or sold any of our software or other products nor have we generated any revenue from operations. BEFORE INVESTING, YOU SHOULD CAREFULLY READ THIS PROSPECTUS AND, PARTICULARLY, THE RISK FACTORS SECTION, BEGINNING ON PAGE 5. NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. Our common stock is not traded on any public market and, although we intend to apply to have the prices of our common stock quoted on the Over-The-Counter Bulletin Board ("OTCBB") maintained by the Financial Industry Regulatory Authority ("FINRA") when the registration statement of which this prospectus is a part is declared effective, there can be no assurance that a market marker will agree to file the necessary documents with FINRA to enable us to participate on the OTCBB, nor can there be any assurance that any application filed by any such market maker for quotation on the OTCBB will be approved. Complete our website: we have secured the web domain located at www.adrenalineventures.net. The site is currently under construction, and we plan to utilize this site with strategic e-commerce retailers. We have budgeted the necessary funding, if available, to develop a quality site. Constantly monitor our market: We plan to constantly monitor our target market and adapt to consumers needs and desires. To be successful, we plan to evolve and diversify our product lines to satisfy the consumer. Operate the Company ethically and responsibly: Conduct our business and ourselves ethically and responsibly. Corporate Status We were incorporated in Wyoming on October 9, 2012, as Adrenaline Ventures, Inc. Our principal executive offices are located at 44523 Saint Andrews Place, Indio, California 92201. Our phone number is 949-981-0144. Our fiscal year ends on September 30. As of the date of this prospectus, we have 10,000,000 shares of our no par value common stock issued and outstanding and held by one shareholder. We are registering for sale 4,000,000 shares of our common stock pursuant to the Securities Act of 1933. Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next 12 months. The financial statements included in the registration statement of which this prospectus is a part do not include any adjustments that might result from the uncertainty about our ability to continue in business. As of September 30, 2013, we had $1,146 in current assets and $8,500 in current liabilities. Accordingly, our negative working capital position as September 30, 2013 was $7,354. On May 29, 2013, our president and sole shareholder purchased 10,000,000 shares of common stock for $10,000. Currently, we do not have enough cash to finance our operations. We estimate that we need approximately $60,000 to support our operations during the next twelve months. This amount includes (i) $9,000 for costs related to this offering, which have not been paid and (ii) $17,000, which is our estimated cost necessary to comply with our reporting requirements during the next twelve months. We believe the maximum proceeds from this offering will be sufficient to meet our cash requirements for the next twelve months. Our cash shortfall will be $15,000, $30,000 and $45,000, respectively, if we sell 75%, 50% and 25% of the maximum offering. We plan to meet any such shortfall through revenue from operations, private placements of our capital stock, and/or loans from Peter McWilliams, our sole shareholder; provided, however, we have no commitment from any person for any additional funds. Presently, we have no employees. Our sole officer and director is responsible for all planning, development and operational duties and will continue to do so throughout the early stages of our growth. Human resource planning will be a part of an ongoing process that will include regular evaluation of our operations. We intend to hire employees at such time as we determine it is appropriate. We can provide no assurance or guarantee on the date on which we will hire employees. We have no present plans to be acquired by or to merge with another company, nor does our shareholder have plans to enter into a change of control or similar transaction. Jumpstart Our Business Startups Act We are electing to not opt out of JOBS Act of 2012 extended accounting transition period. This may make our financial statements more difficult to compare to other companies. Pursuant to the JOBS Act of 2012, as an emerging growth company, we can elect to opt out of the extended transition period for any new or revised accounting standards that may be issued by the PCAOB or the SEC. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the standard for the private company. This may make comparison of our financial statements with any other public company which is not either an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible, as possible different or revised standards may be used. Emerging Growth Company: The JOBS Act of 2012 is intended to reduce the regulatory burden on emerging growth companies. We meet the definition of an emerging growth company and as long as we qualify as an "emerging growth company," we will, among other things: be temporarily exempted from the internal control audit requirements Section 404(b) of the Sarbanes-Oxley Act; be temporarily exempted from various existing and forthcoming executive compensation-related disclosures, for example: "say-on-pay", "pay-for- performance", and "CEO pay ratio"; be temporarily exempted from any rules that might be adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation or supplemental auditor discussion and analysis reporting; be temporarily exempted from having to solicit advisory say-on-pay, say- on-frequency and say-on-golden-parachute shareholder votes regarding executive compensation pursuant to Section 14A of the Securities Exchange Act of 1934, as amended; be permitted to comply with the SEC s detailed executive compensation disclosure requirements on the same basis as a smaller reporting company; and be permitted to adopt any new or revised accounting standards using the same timeframe as private companies (if the standard applies to private companies). We will continue to be an emerging growth company until the earliest of: the last day of the fiscal year during which we have annual total gross revenues of $1 billion or more; the last day of the fiscal year following the fifth anniversary of the first sale of our common equity securities in an offering registered pursuant to the Securities Act of 1933, as amended; the date on which we issue more than $1 billion in non-convertible debt securities during a previous three-year period; or the date on which we become a large accelerated filer, which generally is a company with a public float of at least $700 million (Securities Exchange Act Rule 12b-2). The Offering The following is a brief summary of this offering. Please see the "PLAN OF DISTRIBUTION" section for a more detailed description of the terms of the offering. Number of Shares Being Offered: The Company is offering as many as 4,000,000 shares of common stock, no par value Offering Price per share: $0.015 Offering Period: The shares are being offered for a period not to exceed 180 days from the effective date of the registration statement of which this prospectus is a part. Net Proceeds to Company (determined after deducting $9,000 of costs of this offering which remains unpaid): If 4,000,000 shares (100%) are sold: $51,000 If 3,000,000 shares (75%) are sold: $36,000 If 2,000,000 shares (50%) are sold: $21,000 If 1,000,000 shares (25%) are sold: $6,000 Use of Proceeds: We intend to use the proceeds to expand our business operations. Number of Shares of our Common Stock Outstanding Before the Offering: 10,000,000 shares Number of Shares of our Common Stock Outstanding After the Offering: If 4,000,000 shares (100%) are sold: 14,000,000 shares If 3,000,000 shares (75%) are sold: 13,000,000 shares If 2,000,000 shares (50%) are sold: 12,000,000 shares If 1,000,000 shares (25%) are sold: 11,000,000 shares Offering Expenses: The expenses associated with this offering total approximately $17,500. Of this amount, approximately $8,500 has been paid to date, and the balance ($9,000) will be paid from this offering. We may not sell all 4,000,000 shares offered. There is no minimum number of shares we must sell before we can utilize the proceeds from the purchase of shares. If we do not sell all 4,000,000 shares within the offering period (180 days), we will close the offering and subscription funds will not be returned to subscribers. In the event we do not sell all 4,000,000 shares offered, the amount of money we receive from the sale of those shares which are, in fact, purchased be minimal and may not be enough to even pay the costs of this offering. The offering price of the common stock bears no relationship to any objective criterion of value and has been arbitrarily determined. The price does not bear any relationship to our assets, book value, historical earnings, or net worth. We will use the proceeds from the offering to pay for accounting fees, legal and professional fees, office supplies, products development, contractors, sales and marketing, and general working capital. The Company has not presently engaged an independent stock transfer agent. We have identified several agents to facilitate the processing of stock certificates upon closing of the offering. The purchase of the common stock in this offering involves significant risks. The common stock offered in this prospectus is for investment purposes only and, currently, no market for our common stock exists. Please refer to the sections herein titled "RISK FACTORS" and "DILUTION" before making an investment in our stock. Summary Financial Information The following table sets forth summary financial data derived from our financial statements. The accompanying notes are an integral part of those financial statements and should be read in conjunction with the financial statements, related notes and other financial information included in this prospectus. There is no trading market for our common stock. We intend to apply for participation on the Over-the-Counter Bulletin Board ("OTCBB"), and we hope that thereafter such trading market will develop. We intend to enter into an agreement with a broker-dealer registered with the Securities and Exchange Commission (the "SEC") and a member in good standing of FINRA to assist us in connection with causing the prices of our common stock to be quoted on the OTCBB. There can be no assurance that any application filed by any sponsoring marker maker for such quotation on the OTCBB will be approved. As of the date of this prospectus, we have not developed or sold any of our software or other products nor have we generated any revenue from operations. Oct 9, 2012 (inception) through September 30, 2013 Revenue: $-0- Operating Expenses: Professional 17,000 General and administrative 354 Net Loss $(17,354) Net loss per common share, basic and diluted $(.005)
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001590685_ournett_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001590685_ournett_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001590685_ournett_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001590695_twinlab_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001590695_twinlab_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..d3c69b0e545e1e661dc37f27433836d68a132027
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001590695_twinlab_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary contains basic information about us and the offering. Because it is a summary, it does not contain all the information that you should consider before investing. You should read the entire prospectus carefully, including the risk factors and our financial statements and the related notes to those statements included in this prospectus. Except as otherwise required by the context, references in this prospectus to "we," "our," "us" and Mirror Me refer to Mirror Me, Inc. Mirror Me, Inc. is a development stage company incorporated in the State of Nevada on October 24, 2013. We were formed to engage in the business of designing and developing a mobile beauty shopping tool application that will offer beauty product reviews, location based coupons, and platform for interaction with social networks specific to the products for both the Apple and Android platforms. In October 2013 we commenced our planned principal operations by forming the corporation and began the writing of our initial app. Since our inception on October 24, 2013 through October 31, 2013, we have not generated any revenues and have incurred a net loss of $11,213. Throughout October 24, 2013 and November 30, 2013 our only business activity was the formation of our corporate entity and the development of our business model. In December 2013 we started programming for our initial app, MirrorMe. We anticipate the commencement of generating revenues in the next twelve months, of which we can provide no assurance. The capital raised in this offering has been budgeted to cover the costs associated with the offering, such as accounting services, as well as various filing fees and transfer agent fees. Additionally, capital raised in this offering will fund website and marketing development and working capital. We believe that with our lack of significant expenses, the working capital raised in this offering, and the possible revenues which we may or may not receive from advertising revenue primarily from display, audio and video advertising on our website, we may generate revenues sufficient to support the limited costs associated with our initial ongoing operations for the next twelve months, assuming we are successful in the launching and implementation of our current business plan. However, there can be no assurance that the actual expenses incurred will not materially exceed our estimates or that cash flows from initial advertising revenues from our website will be adequate to maintain our business. As a result, our independent auditors have expressed substantial doubt about our ability to continue as a going concern in the independent auditors report to the financial statements included in the registration statement. Mirror Me is building a business based on the design and development of a mobile beauty shopping tool application that will offer beauty product reviews, location based coupons, and platform for interaction with social networks specific to the products for both the Apple and Android platforms. At this time we are in the process of implementing our marketing plan which includes graphic design work, lead development, and website and app design. We have also started programming for our initial app, MirrorMe; however we do not presently have a market-ready product, and we currently do not have any customers and thus have generated no revenues. We filed a trademark for our corporate logo on December 27, 2013. We have no intentions to be acquired or to merge with an operating company. Additionally, our shareholders have no intention of entering into a change of control or similar transaction. No member of our management or any of our affiliates have been previously involved in the management or ownership of a development stage company that has not implemented its business plan, engaged in a change of control or similar transaction or has generated no or minimal resources to date. We commenced operations in October 2013, since then we have been developing our website and marketing plan, establishing market contacts, researching outlets for sale and distribution as well as writing and designing the programming for our initial app, MirrorMe. Our business model, which is still evolving as new ideas are brought forth, is built on revenue streams initially from advertising revenue from display, audio and video advertising on our website and subsequently from revenue streams from advertising apps, products and services from within our mobile application. Mobile Beauty Shopping Tool App Mirror Me plans to design and develop a mobile beauty shopping tool application that will offer beauty product reviews, location based coupons, and platform for interaction with social networks specific to the products. Our mission is to make every beauty purchase a success by making product discovery more convenient, highly personalized, less costly and more fun. As of the date of this prospectus we have one officer who also serves as our sole director, our sole employee, and who we anticipate will devote 15 to 20 hours a week to the company going forward. Additionally, even with the sale of securities offered hereby, we will not have the financial resources needed to hire additional employees or meaningfully expand our business. Even though we intend to generate revenues upon the commencement of our marketing plan, it is possible we will sustain operating losses for at least the next 12 months. Even if we sell all the securities offered, a substantial portion of the proceeds of the offering will be spent for costs associated with the offering, fees associated with SEC reporting requirements, website development and app writing and development. Investors should realize that following this offering we will be required to raise additional capital to cover the costs associated with our plan of operation. Mirror Me s address and phone number are: Mirror Me, Inc. 1455 Kettner Blvd., #305 San Diego, CA 92101 (562) 618-1310 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 (Amendment No. 3 ) Commission File Number 333-193101 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Mirror Me, Inc. (Exact name of registrant as specified in its charter) Nevada (State or other jurisdiction of incorporation or organization) 7371 (Primary Standard Industrial Classification Code Number) 46-3951742 (I.R.S. Employer Identification Number) 1455 Kettner Blvd., #305 San Diego, CA 92101 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Luz Vazquez, President Mirror Me, Inc. 1455 Kettner Blvd., #305 San Diego, CA 92101 (562) 618-1310 (Name, address, including zip code, and telephone number, including area code, of agent for service) Approximate date of commencement of proposed sale to the public: As soon as practicable after the registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: x If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated file, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company x
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001590743_diamond_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001590743_diamond_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..925b414b2272e082ec0bb9efac3f95b8d7e3adae
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001590743_diamond_prospectus_summary.txt
@@ -0,0 +1,5114 @@
+PROSPECTUS SUMMARY
+
+1
+
+RISK FACTORS
+
+6
+
+CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
+
+11
+
+USE OF PROCEEDS
+
+12
+
+CAPITALIZATION
+
+13
+
+DILUTION
+
+13
+
+MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
+
+15
+
+DESCRIPTION OF BUSINESS AND PROPERTY
+
+16
+
+OUR MANAGEMENT
+
+21
+
+SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+
+24
+
+CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
+
+25
+
+DESCRIPTION OF CAPITAL STOCK
+
+26
+
+SELLING STOCKHOLDERS
+
+27
+
+PLAN OF DISTRIBUTION
+
+30
+
+DISCLOSURE OF COMMISSION POSITION ON
+
+34
+
+INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
+
+34
+
+LEGAL OPINION
+
+35
+
+EXPERTS
+
+35
+
+INTERESTS OF NAMED EXPERTS AND COUNSEL
+
+35
+
+ADDITIONAL INFORMATION
+
+35
+
+SIGNATURES
+
+55
+
+Unless otherwise specified, the information in this prospectus is set forth as of May
+
+23
+
+, 2014,
+
+and we anticipate that changes in our affairs will occur after such date. We have not authorized any person to give any information or to make any representations, other than as contained in this prospectus, in connection with the offer contained in this prospectus. If any person gives you any information or makes representations in connection with this offer, do not rely on it as information we have authorized. This prospectus is not an offer to sell our common stock in any state or other jurisdiction to any person to whom it is unlawful to make such offer. 
+
+PROSPECTUS SUMMARY 
+
+Prospectus Summary
+
+This summary highlights material information about our Company, Diamond Technology Enterprises, Inc. This summary is intended to highlight information contained elsewhere in this prospectus. You should carefully read the entire prospectus, including the section entitled Risk Factors .
+
+Our Business
+
+Diamond Technology Enterprises, Inc. (the Company or DIAMOND TECHNOLOGY ) is an emerging growth company, as defined by the Jumpstart Our Business Startups Act (the JOBS Act ). We shall continue to be deemed an emerging growth company until the earliest to occur of:
+
+(a)
+
+the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; or
+
+(b)
+
+the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective IPO registration statement; or
+
+(c)
+
+the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or
+
+(d)
+
+the date on which such issuer is deemed to be a "large accelerated filer , as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto.
+
+ 
+
+As an emerging growth company we are exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting.
+
+As an emerging growth company we are also exempt from Section 14A (a) and (b) of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes.
+
+We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the Jobs Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.
+
+The Company was organized under the laws of the state of Delaware on January 14, 2013. We formed our Company for the purpose of producing higher quality diamonds from any virtually brown 
+
+Page 1
+
+VS+ diamonds and reselling them in the open market. The Company presently owns two (2) high pressure, high temperature (HPHT) Machines ( Machines ).
+
+The Company s founding principals have been involved in the wholesale diamond industry for more than 30 years in New York City and have extensive experience in the field. The Machines are being imported from Russia where they were developed prior to the fall of the Soviet Union for Super Hard and Novel Carbon Materials. The Company has revamped and modified the Machines, replacing old parts and upgrading the several components that are proprietary to our Company. The Machines utilize the HPHT process that takes any raw, brown diamond, and transforms them into a brilliant, multicolored range of diamonds (white, yellow, pink, green, red, blue and orange) in a process that takes under forty-two seconds per diamond.
+
+While other processes exist that convert Type IIa brown diamonds into natural HPHT diamonds, the Company s Machines are capable of doing so utilizing any brown VS+ diamonds in 42 seconds, many times faster than any known competitor. These competitors are further limited by using only Type IIa brown diamonds in their process. Those diamonds represent a limited supply, generally only 1% of brown stones are Type IIa. The Company believes that the ability to utilize any brown stone and an edge in production time, will allow it to produce more than its competitors, at a substantially reduced cost.
+
+The Company is a start-up enterprise that has a multi-tiered business plan, projected to permit the Company to commence limited operations with the two (2) Machines already owned and to expand the operations by acquiring the fifty (50) additional Machines that are available to purchase as finances allow. Our first machine has been delivered to and is presently being assembled and installed at 250 Port Street, Newark, New Jersey. Management believes this location to be ideal because it offers the security it believes is required and the Company will be able to utilize up to 10,000 square feet as the need arises. This location further meets the weight bearing requirements of the machines, thus allowing for the installation of all fifty-two machines that will weigh in excess of 312 tons once fully acquired and installed. 
+
+Management of the Company anticipates the first machine will be fully operational during the third quarter of calendar year 2014. The Company is awaiting receipt of specially ordered machine parts and expects this machine to be fully assembled and in production in the Third Quarter of calendar year 2014. The estimated cost of parts and labor to accomplish this is approximately $150,000. DTE anticipates that Machine Two will be shipped to its production facility and be in production by Fourth Quarter of calendar year 2014 and that shipping, installation and labor to get it operational will be approximately $150,000.
+
+ Once the first machine is fully operational, management intends to operate it daily, in two shifts; each shift requiring one engineer, one handler and one maintenance worker. Management does not anticipate difficulty in finding and recruiting qualified personal. 
+
+Once the Company has finished the installation process, the training of personnel, and the start of operations of the machines, management intends to begin its sales, marketing and advertising programs. The Company s senior executives believe they have developed strong, industry specific relationships over their prior years of experience and intend to utilize those relationships to begin the Company product sales. 
+
+After the diamonds are processed by the HPHT machines, they will be sold through auction, international jewelry fairs, over the Internet and through the use of wholesale and retail jewelry store outlets and channels. Throughout the Third Quarter of 2014 and through scaling up to 12 machines, the 
+
+Page 2
+
+Company anticipates minimum marketing and advertising efforts will be needed. As production increases our marketing and advertising efforts will begin to scale as well. Initially, the Company believes that the client base developed by the Company s founders will be sufficient sales conduit for the Company s sales requirements. We do anticipate that Company representatives will attend international jewelry fairs to market and advertise the Company and its products in anticipation of having a full complement of 52 machines in production. Management believes that the budgeted amounts as set forth in the Use of Proceeds will be sufficient for these purposes.
+
+The Company s long-term business plan is to acquire the remaining fifty (50) Machines over time and operate the new, secured facility where the additional Machines will operate under 24-hour security. Because of the proprietary trade secrets in upgrading these Machines it is the Company`s intention to own and operate them exclusively and to not offer them for sale to competitors.
+
+Our principal executive offices are currently located at 37 West 47th Street, Suite1301, NY, NY, 10036 and our telephone number is (212) 382 2104.
+
+Our Financial Situation
+
+Since inception of our Company we have not yet generated revenues. Our financial statements from inception to July 31, 2013 and our quarterly financials for the periods ending October 31, 2013 and January 31, 2014 are prepared using the accrual basis of accounting under which revenues are recognized on the income statement when they are earned (rather than when the cash is received).
+
+In order to become profitable, we will need to generate sufficient revenues to offset our Machine acquisition costs, cost of raw diamonds, sales and marketing expenses, and general and administrative expenses.
+
+Recent Developments
+
+We are a development stage company, and our business plan was designed to create a viable, sustainable business. We have filed this registration statement in an effort to become a fully reporting company with the Securities and Exchange Commission in order to enhance our ability to raise additional capital. Our operations to date have been devoted primarily to acquiring the Machines, upgrading and testing the Machines, arranging for transportation to the United States and locating a secure US facility in which to operate. The first of these Machines has arrived in the United States and is located at 250 Port Street, Newark, New Jersey 07114. The second machine presently remains in Russia and is being used by the Company for continued experimentation and modifications. On July 31, 2013, we secured an initial lease originally for 100 and now increased to 3000 square feet of commercial space located at 250 Port Street, Newark, New Jersey 07114 in order to install and house the first machine. The lease is on a month to month basis and the current monthly rent obligation is $2000, inclusive of all utilities. The Company is current in its rental obligations.
+
+In order to generate revenues, we must successfully address the following areas:
+
+1.
+
+The Machines must be delivered and installed in their US location which has been identified and for which lease negotiations have commenced; 
+
+2.
+
+The Company must obtain the necessary personnel to operate the Machines; 
+
+3.
+
+The Company must locate and secure suitable raw diamonds for processing; 
+
+4.
+
+The Machines must operate in such a manner as to effectively and quickly transform brown diamonds into quality diamonds that have the projected market value; 
+
+Page 3
+
+5.
+
+The Company must implement a marketing and advertising plan to promote and sell the finished diamonds Throughout the Third Quarter of 2014, the Company anticipates minimum marketing and advertising efforts will be needed. As the Company adds manufacturing and production increases, our marketing and advertising efforts will begin to scale as well; and 
+
+6.
+
+It is critical as the Company increases the number of machines on-line, that we develop and maintain strong client relationships by marketing and advertising our diamonds and then delivering them on a consistent basis.
+
+Emerging Growth Company
+
+The Company is an emerging growth company as defined in the JOBS Act of 2012. An emerging growth company is a company with annual gross revenues of less than $1 billion during its most recent fiscal year. A company retains emerging growth company status until the earliest of: 
+
+ 
+
+The end of the fiscal year in which its annual revenues exceed $1 billion; 
+
+ 
+
+The end of the fiscal year in which the fifth anniversary of its initial public offering;
+
+ 
+
+The date on which the company has, during the previous three-year period, issued more than $1 billion in non-convertible debt; or
+
+ 
+
+The date on which the company qualifies as a large accelerated filer under the Exchange Act. 
+
+As an emerging growth company we are entitled to reduce regulatory and reporting requirements under the Securities Act and the Exchange Act, including exemptions from Section 404(b) of the Sarbanes-Oxley Act of 2002 and Section 14A (a) and (b) of the Securities Exchange Act of 1934. The Company has elected under Section 107(b) of the Act to extend the transition period for complying with new or revised accounting standards.
+
+The Offering 
+
+This prospectus covers up to 6,000,000 shares to be issued and sold by the Company at a fixed price of $1.00 per share in a direct public offering and 2,987,820 shares held by selling shareholders to be sold at a fixed price of $1.00 per share. 
+
+Page 4
+
+ABOUT THIS OFFERING
+
+Securities Being Offered
+
+Up to 6,000,000 shares of common stock of Diamond Technology Enterprises, Inc. to be sold by the Company at a fixed price of $1.00 per share and 2,987,820 shares of common stock of Diamond Technology Enterprises, Inc. to be sold by selling shareholders at a fixed price of $1.00 per share.
+
+Initial Offering Price
+
+The Company will sell up to 6,000,000 shares at a fixed price of $1.00 per share and the selling shareholders will sell up to 2,987,820 shares at a fixed price of $1.00 per share.
+
+Terms of the Offering
+
+The company and the selling shareholders will offer and sell the common shares in the offering at a fixed price of $1.00 per share for the duration of the offering.
+
+Termination of the Offering
+
+The offering will conclude when the Company has sold all of the 6,000,000 shares of common stock offered by it. The Company may, in its sole discretion, decide to terminate the registration of the shares offered by the Company.
+
+Risk Factors
+
+An investment in our common stock is highly speculative and involves a high degree of risk. See Risk Factors beginning on page 6.
+
+Page 5
+
+RISK FACTORS 
+
+An investment in our common stock is highly speculative, involves a high degree of risk, and should be made only by investors who can afford a complete loss. You should carefully consider the following risk factors, together with the other information in this prospectus, including our financial statements and the related notes, before you decide to buy our common stock. If any of the following risks actually occur, our business, financial condition, or results of operations could be materially adversely affected, the trading of our common stock could decline, and you may lose all or part of your investment therein. 
+
+Risks Relating to the Early Stage of our Company 
+
+We are at a very early operational stage and our success is subject to the substantial risks inherent in the establishment of a new business venture. 
+
+The implementation of our business strategy is in a very early stage. Our business and operations 
+
+should be considered to be in a very early stage and subject to all of the risks inherent in the establishment of a new 
+
+business venture. Accordingly, our intended business and operations may not prove to be successful in the near 
+
+future, if at all. Any future success that we might enjoy will depend upon many factors, several of which may be 
+
+beyond our control, or which cannot be predicted at this time, and which could have a material adverse effect upon 
+
+our financial condition, business prospects and operations and the value of an investment in our Company. 
+
+We have elected to use the extended transition period for complying with the new or revised accounting standards under Section 102(b)(2)(B) of the Act.
+
+We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the Jobs Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.
+
+We have a very limited operating history and our business plan is unproven and may not be successful. 
+
+Our Company was formed in January 2013 and we have not yet had operations. Only one of our Machines is located in the United States, and has only been tested on a limited basis. We have not proven that our business model will allow us to generate a profit. 
+
+We have suffered operating losses since inception and we may not be able to achieve profitability. 
+
+We had an accumulated deficit of ($315,574) as of January 31, 2014 and we expect to continue to incur increasing expenses in the foreseeable future related to the acquisition and integration of additional Machines into production. As a result, we are sustaining substantial operating and net losses, and it is possible that we will never be able to sustain or develop the revenue levels necessary to attain profitability. 
+
+We may have difficulty raising additional capital, which could deprive us of necessary resources. 
+
+We expect to continue to devote significant capital resources to the acquisition of additional Machines, incorporating them into production and obtaining the necessary raw diamond inventory. In order to support the initiatives envisioned in our business plan, we will need to raise additional funds through public or private debt or equity financing, collaborative relationships or other arrangements. Our ability to raise additional capital depends on many factors beyond our control, including the state of capital markets, the market price of our common stock and the development or prospects for development of competitive technology by others. Because our common stock is not listed on a major stock market, many investors may not be willing or allowed to purchase it or may demand steep discounts. Sufficient additional financing may not be available to us or may be available only on terms that would result in further dilution to the current owners of our common stock. 
+
+We expect to raise additional capital during 2014 but we do not have any firm commitments for funding. If we are unsuccessful in raising additional capital, or the terms of raising such capital are unacceptable, we may have to modify our business plan and/or significantly curtail our planned activities and other operations. 
+
+The fact that all of the Machines have not arrived in the United States could create additional expenses and/or cause significant costs to the Company.
+
+Page 6
+
+One of the Machines must be transported from Russia to the United States at our cost. We arranged for transport via ship to the U.S. for the first Machine, however, there is no guaranty that the additional Machines, if and when they are purchased will (a) be delivered on time; (b) be delivered undamaged; (c) be delivered without additional expenses; or (d) be delivered at all.
+
+The current political tensions between the United States and Russia, as well as inherent risks associated with doing business in Russia could create additional expenses and/or cause significant costs to the Company.
+
+The current political tensions between Russia and the United States, as well as other world leaders, could negatively impact the ability of the Company to (a) purchase additional machines; (b) receive the necessary approvals to ship them to the United States once acquired; and/or (c) our ability to work with the one machine located in Russia or with Nikitin Vadim Vladimirovich, the Company s principals and engineer located in Russia. The Company has not currently felt any negative impact from these political tensions, however, should they occur it could result is significant costs to the Company. 
+
+The Company does not currently have a written lease for the facility to house the Machines.
+
+ The only Machine currently in the U.S is located at 250 Port Street, Newark, New Jersey 07114. It is presently being modified at this location into a fully functional, productive machine which the Company anticipates to be operational by the second half of 2014. The Company presently has a verbal lease for manufacturing space at this location for housing up to 12 machines in the 3000 square feet leased. The Company anticipates a written agreement which is presently being negotiated and the parties anticipate it being finalized by April, 2014. The Company s projections are based upon certain leasehold expenses, which may be significantly different from what the Company is actually able to achieve when and if a facility is leased. The Company s projections also include build-out expenses for the lease under negotiations, and those amounts, may differ significantly if the Company needs to lease another location. 
+
+The US based Machine is not currently in production. 
+
+The Company has one (1) Machine currently in the United State, however, since it is not as of yet operational, there could be significant unknown costs and time delay s associated with that Machine coming into production, if it ever does. 
+
+The Company is relying on Nikitin Vadim Vladimirovich to acquire, update and calibrate the Machines as they are acquired and put into production. 
+
+Nikitin Vadim Vladimirovich, is one of the Company s principals and an engineer, who the Company intends to rely upon to update and calibrate the Machines as they come into production. He has been training other engineers; however, he will be the Company s primary engineer. In addition, it is Mr. Vladimirovich who is responsible for the continued negotiation and acquisition of the additional Machines the Company needs to purchase in Russia. Mr. Vladimirovich resides in Russia and is not a U.S resident. Should he be unable to travel to the U.S. for any reason, or should he be incapacitated or otherwise unable to perform these functions, the Company would be required to rely on other engineers, who may or may not be capable of performing these functions. 
+
+The Machines were never used in a commercial setting and have been sitting dormant for 20 years, which could lead to additional expenses and technological difficulties that are not anticipated. 
+
+These two (2) Machines were manufactured in the Soviet Union in 1994 and were never used prior to being shuttered. They have sat dormant until acquired by Nikitin Vadim Vladimirovich in 2012. Although the Seller has represented that the remaining machines will be in good operating condition, they may need additional repairs and modifications that have not yet been anticipated. There is no guaranty that the machines will be capable of becoming operational based on their age and condition which are largely unknown at this time. 
+
+These Machines have not been independently tested and may not meet the Company s projections. 
+
+The Company s founder, Eduard Musheyev, has been involved with the testing of a Machine in Russia, however, although there has been independent testing of one (1) Machine, there is no guaranty that additional Machines will be able to meet the Company s projections, of each Machine running at an efficiency rate of 85 stones per hour , producing 600 stones per day. 
+
+The Company s business plan calls for production utilizing 52 Machines, however, at commencement the Company will have only two (2) Machines, which impacts the Company s profitability. 
+
+The Machines must be recalibrated between each size stone which (a) slows down the production efficiency; and (b) increases the breakage rate due to calibration adjustments. The raw diamonds needed are not sold in one size lots, requiring the Company to acquire various sizes with each purchase, and then sort them into like size lots and run each lot separately. When the 
+
+Page 7
+
+Machine must be recalibrated between sizes, the likelihood of breakage is increased. At the Company s projected 52 Machine operation, each Machine would be calibrated for a particular sized stone, allowing the Company to run different sized lots simultaneously, thus improving efficiency, and reducing waste. 
+
+The Company does not have the capital to acquire raw diamonds on its own account at this time and thus its projected profits could be substantially reduced. 
+
+The Company s ultimate business model relies on its ability to acquire the raw diamonds, subject them to the HPHT process and then sell them at a profit. To commence operations, however, the Company does not have the necessary capital to acquire the diamonds it needs, and will therefore need to obtain financing therefore or rely on other parties to (a) supply the diamonds on consignment; or (b) joint venture with the Company on the acquisition. In a consignment scenario, the Company will be paid a fee for the HPHT process; and in a joint venture scenario, the Company will likely need to share the profits earned, both of which reduce the projected profits of the Company. 
+
+The Company does not have the capital to acquire the additional Machines needed for its long-term business plan, nor does it have a contract to purchase them or other legal agreement with the current owner.
+
+The Company s long term plan is to acquire fifty (50) additional Machines from Russia, however, the Company does not have the capital needed to make such acquisitions and there is no source of funding identified at this time. In addition, the Company does not have a contract with the Seller to purchase the additional Machines, nor any other legally enforceable agreement which will ensure that that Company can buy these Machines if and when it has the funding. In addition, there can be no guaranty of the price that will be charged for the Machine when and if the Company is in a position to purchase them. Without the additional Machines, the Company s business plan will not be possible as there is no other source for these Machines.
+
+There are substantial doubts about our ability to continue as a going concern and if we are unable to continue our business, our shares may have little or no value. 
+
+The report of our independent auditors on our financial statements for the period ended July 31, 2013 included an explanatory paragraph indicating that there is substantial doubt about our ability to continue as a going concern. The Company s ability to become a profitable operating company is dependent upon its ability to generate revenues and/or obtain needed financing has raised substantial doubts about our ability to continue as a going concern. We plan to attempt to raise additional equity capital by selling shares in this offering and, if necessary, through one or more private placement or public offerings. However, the doubts raised, relating to our ability to continue as a going concern, may make our shares an unattractive investment for potential investors. These factors, among others, may make it difficult to raise any additional capital. 
+
+Failure to effectively manage our growth could place strains on our managerial, operational and financial resources and could adversely affect our business and operating results. 
+
+Our growth is expected to place a strain on our managerial, operational and financial resources. Further an increase in the number of our strategic relationships will increase this strain on our managerial, operational and financial resources. This strain may inhibit our ability to achieve the rapid execution necessary to implement our business plan, and could have a material adverse effect upon our financial condition, business prospects and operations and the value of an investment in our Company. 
+
+Risks Relating to Our Business 
+
+We will need to achieve a consistent sale distribution system for the sale of our diamonds to generate revenues and achieve profitability. 
+
+Even if our processing yields diamonds in an array of colors, we may not successfully develop commercial distribution systems for them, and even if we do, we may not do so on a timely basis. We cannot predict when or if we will be able to establish a consistent sale distribution system for our diamonds, if at all, and we cannot reliably estimate the projected size of any such potential market. If the distribution system does not materialize, we may not be able to generate revenues from the commercial application of our technologies. Our revenue growth and achievement of profitability will depend substantially on our ability to introduce diamonds that are accepted by customers. If we are unable to cost-effectively achieve acceptance of our diamonds by customers, or if they do not achieve wide market acceptance, our business will be materially and adversely affected.
+
+We will need to establish additional relationships with collaborative and development partners to fully develop and market our diamonds. 
+
+We do not possess all of the resources necessary to develop and commercialize the diamonds on a mass scale. Unless we 
+
+Page 8
+
+expand our development capacity and enhance our internal marketing, we will need to make appropriate arrangements with collaborative affiliates to develop and commercialize current and future diamonds. If we need, but do not find appropriate affiliate arrangements, our ability to develop and commercialize these diamonds could be adversely affected. 
+
+We rely on third parties to supply the raw diamonds needed, and our business will suffer if they do not provide adequate support. 
+
+A stable network of suppliers capable of providing sufficient raw materials is required to support our business plan. While management has significant contacts in the industry, we currently do not have a dedicated source of diamonds to process, and if we cannot obtain a steady, affordable and reliable source, our business will suffer. 
+
+We may lose out to larger and better-established competitors. 
+
+The diamond industry is intensely competitive. Most of our competitors have significantly greater financial, technical, marketing and distribution resources as well as greater experience in the industry than we have. While we anticipate being able to produce our diamonds from virtually any brown VS+ diamond in a fraction of the time as our competitors, we may not have the resources, name recognition and/or market penetration for our diamonds that our competitors have and we may not be able to achieve the necessary market share needed to support our operations. If this happens, our sales and revenues will decline. In addition, our current and potential competitors may establish cooperative relationships with larger companies, to gain access to greater development or marketing resources. Competition may result in price reductions, reduced gross margins and loss of market share.
+
+Our processed diamonds may be displaced in the market. 
+
+The diamond industry is competitive and subject to consumer opinion as to perceived quality. Third parties may succeed in developing or marketing enhanced diamonds that are more effective than those marketed by us. We may not have the resources to do this. If our diamonds do not achieve a quality reputation, or strong consumer demand, our sales and revenues will decline. 
+
+Risks Relating to our Stock 
+
+The Offering price of $1.00 per share is arbitrary. 
+
+The Offering price of $1.00 per share has been arbitrarily determined by our management and does not bear any relationship to the assets, net worth or projected earnings of the Company, or any other generally accepted criteria of value. 
+
+We have no firm commitments to purchase any shares. 
+
+We have no firm commitment for the purchase of any shares. Therefore there is no assurance that a trading market will develop or be sustained. The Company has not engaged a placement agent or broker for the sale of the 
+
+shares. The Company may be unable to identify investors to purchase the shares and may have inadequate capital to support its ongoing business obligations. 
+
+All proceeds from the sale of shares offered by the Company will be immediately available for use by the Company. 
+
+There is no minimum offering amount and we have not established an escrow to hold any of the proceeds from the sale of the shares offered by the Company. As a result, all proceeds from the sale of shares offered by the Company will be available for immediate use by the Company. The proceeds of the sale may not be sufficient to implement the Company s business strategy. 
+
+The sale of the shares of common stock acquired in private placements could cause the price of our common stock to decline. 
+
+The selling stockholders under this registration statement may sell none, some, or all of the shares of common stock acquired from us. We have no way of knowing whether or when the selling stockholders will sell the shares covered by this registration statement. Depending upon market liquidity at the time, a sale of shares covered by these registration statements at any given time could cause the trading price of our common stock to decline. The sale of a substantial number of shares of our common stock under this registration statement, or anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish. 
+
+Our shares are not currently traded on any market or exchange. We intend to apply to have our common stock traded over the counter; there is no guarantee that our shares will ever be quoted on the OTC Bulletin Board or listed on an exchange, which could severely 
+
+Page 9
+
+impact their liquidity. 
+
+Currently our shares are not traded on any market or exchange. We intend to apply to have our common stock quoted via the OTC Electronic Bulletin Board. Therefore, our common stock is expected to have fewer market makers, lower trading volumes and larger spreads between bid and asked prices than securities listed on an exchange such as the New York Stock Exchange or the NASDAQ Stock Market. These factors may result in higher price volatility and less market liquidity for the common stock. It is possible that the Company s shares may never be quoted on the OTC Bulletin Board or listed on an exchange.
+
+A low market price would severely limit the potential market for our common stock. 
+
+Our common stock is expected to trade at a price substantially below $5.00 per share, subjecting trading in 
+
+the stock to certain SEC rules requiring additional disclosures by broker-dealers. These rules generally apply to any 
+
+non-NASDAQ equity security that has a market price share of less than $5.00 per share, subject to certain 
+
+exceptions (a penny stock ). Such rules require the delivery, prior to any penny stock transaction, of a disclosure 
+
+schedule explaining the penny stock market and the risks associated therewith and impose various sales practice 
+
+requirements on broker-dealers who sell penny stocks to persons other than established customers and institutional 
+
+or wealthy investors. For these types of transactions, the broker-dealer must make a special suitability determination 
+
+for the purchaser and have received the purchaser s written consent to the transaction prior to the sale. The broker-
+
+dealer also must disclose the commissions payable to the broker-dealer, current bid and offer quotations for the 
+
+penny stock and, if the broker-dealer is the sole market maker, the broker-dealer must disclose this fact and the 
+
+broker-dealer s presumed control over the market. Such information must be provided to the customer orally or in 
+
+writing before or with the written confirmation of trade sent to the customer. Monthly statements must be sent 
+
+disclosing recent price information for the penny stock held in the account and information on the limited market in 
+
+penny stocks. The additional burdens imposed upon broker-dealers by such requirements could discourage broker-
+
+dealers from effecting transactions in our common stock. 
+
+FINRA sales practice requirements may also limit a stockholders ability to buy and sell our stock. 
+
+In addition to the penny stock rules promulgated by the SEC, which are discussed in the immediately preceding risk factor, FINRA rules require that in recommending an investment to a customer, a broker -dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative, low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit the ability to buy and sell our stock and have an adverse effect on the market value for our shares. 
+
+An investor s ability to trade our common stock may be limited by trading volume. 
+
+A consistently active trading market for our common stock may not occur on the OTCBB. A limited trading volume may prevent our shareholders from selling shares at such times or in such amounts as they may otherwise desire. The Company s shares may never be quoted on the OTC Bulletin Board or listed on an exchange.
+
+Our company has a concentration of stock ownership and control, which may have the effect of delaying, preventing, or deterring a change of control. 
+
+Our common stock ownership is highly concentrated. Through ownership of shares of our common stock, one shareholder, Eduard Musheyev, CEO/President/Chairman, beneficially owns 43% of our total outstanding shares of common stock before this offering. Further, Eduard Musheyev owns one million shares of Preferred A stock which has a voting designation of 100 to 1, giving him an additional 100 million votes. As a result of the concentrated ownership of the stock, this stockholder, acting alone, will be able to control all matters requiring stockholder approval, including the election of directors and approval of mergers and other significant corporate transactions. This concentration of ownership may have the effect of delaying, preventing or deterring a change in control of our company. It could also deprive our stockholders of an opportunity to receive a premium for their shares as part of a sale of our company and it may affect the market price of our common stock. 
+
+We have not voluntarily implemented various corporate governance measures, in the absence of which, shareholders may have more limited protections against interested director transactions, conflicts of interest and similar matters. 
+
+Recent federal legislation, including the Sarbanes-Oxley Act of 2002, has resulted in the adoption of various corporate governance measures designed to promote the integrity of the corporate management and the securities markets. Some of these measures have been 
+
+Page 10
+
+adopted in response to legal requirements; others have been adopted by companies in response to the requirements of national securities exchanges, such as the NYSE or the NASDAQ Stock Market, on which their securities are listed. Among the corporate governance measures that are required under the rules of national securities exchanges and NASDAQ, are those that address the board of Directors independence, audit committee oversight, and the adoption of a code of ethics. Our Board of Directors has not adopted a Code of Ethics and Business Conduct at this time, we have not yet adopted any of these corporate governance measures, and since our securities are not listed on a national securities exchange or NASDAQ, we are not required to do so. It is possible that if we were to adopt some or all of these corporate governance measures, shareholders would benefit from somewhat greater assurances that internal corporate decisions were being made by disinterested directors and that policies had been implemented to define responsible conduct. For example, in the absence of audit, nominating and compensation committees comprised of at least a majority of independent directors, decisions concerning matters such as compensation packages to our senior officers and recommendations for director nominees, may be made by a majority of directors who have an interest in the outcome of the matters being decided. Prospective investors should bear in mind our current lack of corporate governance measures in formulating their investment decisions. 
+
+Because we will not pay dividends in the foreseeable future, stockholders will only benefit from owning common stock if it appreciates. 
+
+We have never paid dividends on our common stock and we do not intend to do so in the foreseeable 
+
+future. We intend to retain any future earnings to finance our growth. Accordingly, any potential investor who 
+
+anticipates the need for current dividends from his investment should not purchase our common stock. 
+
+CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
+
+This prospectus contains forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting the financial condition of our business. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including, among other things: 
+
+Factors that might cause these differences include the following: 
+
+ 
+
+the ability of the Company to offer and sell the shares of common stock offered hereby;
+
+ 
+
+the acquisitions of the machines needed for full optimizations; 
+
+ 
+
+the ability to retain certain members of management; 
+
+ 
+
+our expectations regarding general and administrative expenses; 
+
+ 
+
+our expectations regarding cash balances, capital requirements, anticipated revenue and expenses, including infrastructure expenses; and
+
+ 
+
+Other factors detailed from time to time in filings with the SEC. 
+
+In addition, in this prospectus, we use words such as anticipate, believe, plan, expect, future, intend, and similar expressions to identify forward-looking statements. 
+
+In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this prospectus may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. 
+
+USE OF PROCEEDS
+
+With respect to up to 6,000,000 shares of common stock to be sold by the Company, unless we provide otherwise in a supplement to this prospectus, we intend to use the net proceeds from the sale of our securities for general corporate purposes, which may include one or more of the following: 
+
+ 
+
+working capital; 
+
+ 
+
+acquisition of machines and /or raw materials; 
+
+ 
+
+capital expenditures. 
+
+Page 11
+
+Our management will have broad discretion in the allocation of the net proceeds of any offering, however, the following table outlines management s current anticipated use of proceeds given that the offering is being completed on a best-efforts basis and may not result in the Company receiving the entire offering amount. In the event that 100% of the funds are not raised, management has outlined how they perceive the funds will be allocated, at various funding levels. The offering scenarios are presented for illustrative purposes only and the actual amount of proceeds, if any, may differ. The offering expenses of any selling shareholders are not included in this table, and any such expenses that were to be incurred would be paid out of General Operating Expenses. Management does not intend to reallocate such proceeds.. Pending such uses, we intend to invest the net proceeds in short-term, investment grade, interest-bearing securities. 
+
+USE OF PROCEEDS
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+% of Shares Sold
+
+25%
+
+50%
+
+75%
+
+100%
+
+# of Shares Sold
+
+1,500,000
+
+3,000,000
+
+4,500,000
+
+6,000,000
+
+ 
+ 
+ 
+ 
+ 
+
+Gross Proceeds
+
+1,500,000
+
+3,000,000
+
+4,500,000
+
+6,000,000
+
+ Less: Offering Expenses*
+
+150,000
+
+300,000
+
+450,000
+
+600,000
+
+ 
+ 
+ 
+ 
+ 
+
+Net Proceeds to the Company
+
+1,350,000
+
+2,700,000
+
+4,050,000
+
+5,400,000
+
+ 
+ 
+ 
+ 
+ 
+
+Use of Proceeds:
+
+ 
+ 
+ 
+ 
+
+ Legal & Accounting
+
+30,000
+
+60,000
+
+90,000
+
+120,000
+
+ General Operational Expenses/Working Capital
+
+930,000
+
+1,030,000
+
+1,255,000
+
+1,365,000
+
+ Production & Development
+
+50,000
+
+50,000
+
+75,000
+
+100,000
+
+ Administrative Cost 
+
+100,000
+
+100,000
+
+100,000
+
+100,000
+
+IT Infrastructure (hardware/software)
+
+62,500
+
+125,000
+
+250,000
+
+250,000
+
+ Advertising & Promotion
+
+42,500
+
+60,000
+
+100,000
+
+150,000
+
+ Marketing/Sales Team
+
+85,000
+
+120,000
+
+200,000
+
+300,000
+
+Build out Leasehold
+
+Equipment Acquisition
+
+ 50,000
+
+ -0- 
+
+ 50,000
+
+1,105,000
+
+ 50,000
+
+1,930,000
+
+ 50,000
+
+2,965,000
+
+ 
+ 
+ 
+ 
+ 
+
+Total
+
+1,350,000
+
+2,700,000
+
+4,050,000
+
+5,400,000
+
+*Offering Expenses $0.10/share
+
+ 
+ 
+ 
+ 
+
+Page 12
+
+CAPITALIZATION 
+
+The following table sets forth our capitalization as of July 31, 2013. 
+
+July 31, 2013
+
+Long-term liabilities
+
+$ -
+
+ 
+ 
+
+Stockholder s equity:
+
+ 
+
+ Series A Convertible Preferred stock to be issued
+
+100
+
+ Common stock to be issued
+
+768,050
+
+ Additional paid-in capital
+
+745,559
+
+ Common stock subscription 
+
+-
+
+ Deficit accumulated during development stage
+
+(58,188)
+
+Total stockholders equity
+
+1,456,321
+
+ 
+ 
+
+Total capitalization
+
+$ 1,456,321
+
+DILUTION 
+
+The net tangible book value of our company as of July 31, 2013 was $1,456,321 with 63,260,000 shares of common stock to be issued or $0.023 per share of common stock. Net tangible book value per share is determined by dividing the tangible book value of the company (total tangible assets less total liabilities) by the number of shares of our common stock to be issued at July 31, 2013. 
+
+Our net tangible book value and our net tangible book value per share will be impacted by the 6,000,000 shares of common stock which may be sold by our company. The amount of dilution will depend on the number of shares sold by our company. The following example shows the dilution to new investors at an assumed offering price of $1.00 per share. 
+
+We are registering 6,000,000 shares of common stock for sale by our company. If all shares are sold at the offering price of $1.00 per share, less estimated offering expenses equal to ten percent (10%), totaling $600,000 (which does not include the offering expense in the sale of any private stock), our net tangible book value would be $6,856,321 or approximately $0.10 per share. Such an offering would represent an immediate increase in net tangible book value to existing stockholders of $0.08 per share and an immediate dilution to new stockholders of $0.90 per share. The following table illustrates the per share dilution as described herein:
+
+$6,000,000 Maximum Offering (100%)
+
+6,000,000 shares sold at $1.00 per share resulting in Net book value of $6,856,321.
+
+ 
+ 
+ 
+
+Assumed public offering price per share
+
+$1.00
+
+ 
+
+Net tangible book value per share before this offering
+
+ $0.023
+
+ 
+
+Increase attributable to new investors
+
+$0.08
+
+ 
+
+Net tangible book value per share after this offering
+
+$0.10
+
+ 
+
+Dilution per share to new stockholders
+
+$0.90
+
+ 
+
+ 
+ 
+ 
+
+Current Shareholders % after offering
+
+91.34%
+
+ 
+
+Purchasers % after offering
+
+8.66%
+
+ 
+
+Current Shareholders Capital Contribution
+
+20.15%
+
+ 
+
+Purchasers Capital Contribution
+
+79.85%
+
+ 
+
+If only 75%, or 4,500,000 shares, are sold at the offering price of $1.00 per share, less estimated offering expenses totaling $450,000, (which does not include the offering expense in the sale of any private stock), our net tangible book value would be $5,506,321 or approximately $0.08 per share. Such an offering would represent an immediate increase in net tangible book value to existing stockholders of $0.06 per share and an immediate dilution to new stockholders of $0.92 per share. The following table illustrates the per share dilution as described herein:
+
+Page 13
+
+$4,500,000 Offering (75%)
+
+4,500,000 shares sold at $1.00 per share resulting in Net book value of $5,506,321.
+
+ 
+ 
+ 
+
+Assumed public offering price per share
+
+$1.00
+
+ 
+
+Net tangible book value per share before this offering
+
+$0.023
+
+ 
+
+Increase attributable to new investors
+
+$0.06
+
+ 
+
+Net tangible book value per share after this offering
+
+$0.08
+
+ 
+
+Dilution per share to new stockholders
+
+$0.92
+
+ 
+
+ 
+ 
+ 
+
+Current Shareholders % after offering
+
+93.36%
+
+ 
+
+Purchasers % after offering
+
+6.64%
+
+ 
+
+Current Shareholders Capital Contribution
+
+25.18%
+
+ 
+
+Purchasers Capital Contribution
+
+74.82%
+
+ 
+
+If only 50%, or 3,000,000 shares, are sold at the offering price of $1.00 per share, less estimated offering expenses equal to ten percent (10%) or $300,000, (which does not include the offering expense in the sale of any private stock), our net tangible book value would be $4,156,321 or approximately $0.06 per share. Such an offering would represent an immediate increase in net tangible book value to existing stockholders of $ 0.04 per share and an immediate dilution to new stockholders of $0.94 per share. The following table illustrates the per share dilution as described herein:
+
+$3,000,000 Offering (50%)
+
+3,000,000 shares sold at $1.00 per share resulting in Net book value of $4,156,321.
+
+ 
+ 
+ 
+
+Assumed public offering price per share
+
+$1.00
+
+ 
+
+Net tangible book value per share before this offering
+
+$0.023
+
+ 
+
+Increase attributable to new investors
+
+$0.04
+
+ 
+
+Net tangible book value per share after this offering
+
+$0.06
+
+ 
+
+Dilution per share to new stockholders
+
+$0.94
+
+ 
+
+ 
+ 
+ 
+
+Current Shareholders % after offering
+
+95.47%
+
+ 
+
+Purchasers % after offering
+
+4.53%
+
+ 
+
+Current Shareholders Capital Contribution
+
+33.55%
+
+ 
+
+Purchasers Capital Contribution
+
+66.45%
+
+ 
+
+If only 25%, or 1,500,000 shares, are sold at the offering price of $1.00 per share, less estimated offering expenses equal to ten percent (10%) or $150,000, (which does not include the offering expense in the sale of any private stock), our net tangible book value would be $2,806,321 or approximately $0.04 per share. Such an offering would represent an immediate increase in net tangible book value to existing stockholders of $0.02 per share and an immediate dilution to new stockholders of $0.96 per share. The following table illustrates the per share dilution as described herein:
+
+$375,000 Offering (25%)
+
+1,500,000 shares sold at $1.00 per share resulting in Net book value of $2,806,321.
+
+ 
+ 
+ 
+
+Assumed public offering price per share
+
+$1.00
+
+ 
+
+Net tangible book value per share before this offering
+
+$0.023
+
+ 
+
+Increase attributable to new investors
+
+$0.02
+
+ 
+
+Net tangible book value per share after this offering
+
+$0.04
+
+ 
+
+Dilution per share to new stockholders
+
+$0.96
+
+ 
+
+Current Shareholders % after offering
+
+97.68%
+
+ 
+
+Purchasers % after offering
+
+2.32%
+
+ 
+
+Current Shareholders Capital Contribution
+
+50.24%
+
+ 
+
+Purchasers Capital Contribution
+
+49.76%
+
+ 
+
+Control
+
+One shareholder has effective control over the Company before and after this Offering. Eduard Musheyev, CEO/President/Chairman, beneficially owns 43% of our total outstanding shares of common stock before this offering. Further, Eduard Musheyev owns one million shares of Preferred A stock which has a voting designation of 100 to 1, giving him an additional 100 million votes. 
+
+Page 14
+
+MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
+
+Our common stock is not currently traded on any exchange. We cannot assure that any market for the shares will develop or be sustained. 
+
+We have not paid any dividends on our common stock and do not anticipate paying cash dividends in the foreseeable future. We intend to retain any earnings to finance the growth of our business. We cannot assure you that we will ever pay cash dividends. Whether we pay cash dividends in the future will be at the discretion of our Board of Directors and will depend upon our financial condition, results of operations, capital requirements and any other factors that the Board of Directors decides are relevant. See Management s Discussion and Analysis of Financial Condition and Results of Operations. 
+
+As of May
+
+ 2
+
+3
+
+, 2014, the Company has seventy-one (71) shareholders who hold 100% of its issued and outstanding common stock. 
+
+Page 15
+
+DESCRIPTION OF BUSINESS AND PROPERTY
+
+General
+
+Diamond Technology Enterprises, Inc., a Delaware company, formed in January 2013, is a development stage company whose focus will be to process virtually any brown VS + diamond utilizing its HPHT Machinery into an array of multicolored diamonds with Machines owned by the Company and then to sell the enhanced diamonds to the resell market as discussed below. The Company is headquartered in New York City. The Company s business plan calls for the Company to acquire brown VS + diamonds, from numerous sources, which will then be processed into an array of colors, utilizing the Machines, in a process that is significantly faster than any competitor. 
+
+The Company has two (2) Machines to commence its operations, and intends to acquire fifty (50) additional Machines as funds and demand require. The anticipated schedule for incorporating new Machines would be an initial acquisition of ten (10) Machines (or as many as our initial financing allows) and thereafter up to five (5) additional machines per month until the Company has acquired all fifty (50) Machines. 
+
+ 
+
+The Company is a start-up enterprise that has a multi-tiered business plan, projected to permit the Company to commence limited operations with the two (2) Machines already owned and to expand the operations by acquiring the fifty (50) additional Machines that are available to purchase as finances allow. Our first machine has been delivered to and is presently being assembled and installed at 250 Port Street, Newark, New Jersey. Management believes this location to be ideal because it offers the security it believes is required and the Company will be able to be expanded up to 10,000 square feet as needed. This location further meets the weight bearing requirements of the machines, thus allowing for the installation of all fifty-two machines that will weigh in excess of 312 tons once fully acquired and installed. 
+
+The management of the Company anticipates the first machine will be fully operational by the end of the third quarter of 2014. Once the first machine is fully operational, management intends to operate it daily, in two shifts; each shift requiring one engineer, one handler and one maintenance worker. Management does not anticipate difficulty in finding and recruiting qualified personal. 
+
+Once the Company has finished the installation process, the training of personnel, and the start of operations of the machines, management intends to begin its sales, marketing and advertising programs. The Company s senior executives believe they have developed strong, industry specific relationships over their prior years of experience and intend to utilize those relationships to begin the Company product sales. 
+
+After the diamonds are processed by the HPHT machines, they will be sold through management s existing client base, auctions, international jewelry fairs, over the Internet and through the use of wholesale and retail jewelry store outlets and channels. 
+
+The Company s long-term business plan is to acquire the remaining fifty (50) Machines over time and operate the new, secured facility where the additional Machines will operate under 24-hour security. Because of the proprietary trade secrets in upgrading these Machines it is the Company`s intention to own and operate them exclusively and to not offer them for sale to competitors.
+
+ 
+
+Mission 
+
+It is the mission of Diamond Technology Enterprises, Inc. to become a leader in the HPHT diamond market by creating high quality diamonds from brown VS+ diamonds. 
+
+Company Overview
+
+The Company was founded by Eduard Musheyev, a diamond industry executive with more than 30 years of experience in the industry as a jewelry manufacturer, designer and operator of jewelry wholesale and retail operations. Through his relationships in Russia, he collaborated with Nikitin Vadim Vladirmirovich, an engineer and businessman, to acquire the Machines that had lain dormant for years due to the collapse of the Soviet Union. The Machines have been modified and updated by these Company founders. The Company s competitive edge comes from its ability to (a) complete the process in 42 seconds; and (b) utilize virtually any brown VS+ raw diamonds that are not usable by our competitors. 
+
+Page 16
+
+Products and Services
+
+ 
+
+The Company s business plan calls for the commencement of full operation with up to twelve (12) Machines, including the two (2) Machines presently owned by the Company, and building up to fifty-two (52) Machines over the next two (2) years. As a development stage company, the business plan calls for the Company to process raw brown diamonds from numerous sources. Purchasing may be direct by the Company, through joint ventures with others or through consignment arrangement with the Company s customers.
+
+The method of acquiring the raw diamonds will dictate the Company s projected profits. 
+
+The Company has no revenue at this time as it still in the development stage of acquiring the Machines and developing sources for the raw diamonds. 
+
+Through its proprietary technology and what the founders believe are sophisticated High Pressure High Temperature (HPHT) Machinery, the Company anticipates providing to jewelry manufacturers an array of HPHT processed diamonds to add to the approximate $71 billion diamond jewelry marketplace by transforming virtually any brown VS + diamond into a brilliant array of high quality Melee Diamonds. As reported in the Global Diamond Industry Portrait of Growth issued by Bain & Company, the diamond jewelry marketplace is a $71 billion dollar annual market. These proprietary Machines, through the use of HPHT technology can complete nature s own process to produce stones of color of white, yellow, pink, green, red, blue and orange. Brown stones which in their original condition have minima value in the jewelry business, become stones of high demand and high cost in the diamond marketplace.
+
+While Melee is used to classify small diamonds weighing .55 carats or less, the use of diamond melee in jewelry makes up a large portion of the world s diamond consumption. This marketplace continues to remain stable and in fact has experienced growth over the past year. The Rapaport Melee Diamond Index reported an increase of 4% in the fourth quarter of 2013, with prices showing a consistent and steady increase. 
+
+According to Global Diamond Industry Lifting the Veil of Mystery issued by Bain & Company in 2011, while demand for Melee diamonds continues to rise, the supply of mined diamonds from known reserves are in steady decline; though it is management s belief that brown stones will continue to be extracted as part of the mining process, and continue to have a minimal value for the mining operator, thus remaining in plentiful supply. . The Company is attempting to enter this expanding market at an opportune time, and intends to capitalize on this void by supplying jewelry manufacturers with Company Melee Diamonds available in a wide variety of sizes and colors and present them at a significant discount to market value. 
+
+We believe we are the only company using HPHT Machinery that is specially designed to process Melee-classified stones, thus streamlining cost and efficiencies for both the Company and its worldwide customer base. Through the relationships that have been developed by our founder, Mr. Musheyev, we intend to acquire product from the world s most active diamond mines in Canada, Australia, Botswana, the Democratic Republic of Congo, Russia and South Africa. The rough diamonds will be cut and polished and delivered to the Company s production facilities.
+
+Keys to Success 
+
+Acquire the Machines
+
+The Company has acquired two (2) Machines and is attempting to arrange the purchase and/or lease purchase of up to an additional fifty (50) Machines. The Company anticipates that up to twelve (12) Machines should be fully operational in 2015.
+
+Acquire the Location and Install Machines
+
+Initial production location space has been leased and preliminary terms are being negotiated for expansion as needed. It is intended the leased space will be built out to assure full security and is expected to be fully operational in 2014.
+
+Staffing
+
+The executive staff is presently in place. The production staff is expected to be in place at least 30 days prior to production for training and implementation of security protocols. The Company s initial staffing plans are based upon needing three (3) personnel (consisting of an engineer mechanic and cylinder feeder) at a payroll cost of approximately $20,000 per month, for the initial two 
+
+Page 17
+
+machines. The staffing requirements would then be scaled upwards as machines are brought on-line at the rate of: 3 engineers per 12 machines; 4 handlers per 12 machines; 4 cylinder feeders per 12 machines and one Senior engineer for supervision per 12 machines. We anticipate interviewing, hiring and training to fill the necessary positions 30 days prior to initial production of machines. 
+
+Obtain insurance 
+
+The Company will need to put into place, full coverage insurance to include E&O, D&O, and Executive umbrella insurance costing approximately $420,000 on an annual combined basis. The company is currently shopping for insurance to cover its perceived risks. 
+
+ 
+
+Acquire the raw materials
+
+Raw materials may be purchased from a variety of mining sources or brokers. Raw materials will be competitively sourced for quality, price and terms. The Company estimates that the monthly cost for raw materials for one (1) machine in production will average approximately $2 million depending on global market conditions at that time. Working capital availability estimated in our Use of Proceeds and anticipated credit terms will be utilized to cover these costs.
+
+ Complete the HPHT process
+
+The HPHT process is a manufacturing operation with proprietary Machines that produces a Melee gemstone diamond, from any brown VS+ diamond, in forty-two seconds that then requires post production polishing before being able to be sold to the jewelry industry.
+
+ 
+
+Sell the Completed Diamonds
+
+The company plans to sell the completed diamonds initially to its existing client base and thereafter auctions hosted by the Rapaport Company in New York, Hong Kong, Israel and Belgium. The Company will also attend and sell its products at International Jewelry and Gem Fairs held frequently and at global locations.
+
+Business Model
+
+ 
+
+Our business model is to sell a substantial portion of our production for our own account at auction and at international jewelry and gem fairs. The Company also expects to design and manufacture jewelry products for sale in the global marketplace to large department stores and jewelry retail franchise organizations. In addition, the Company may consider devoting certain of its Machines to process diamonds supplied by others for a manufacturing service fee. The Company has the ability to add additional shifts to its manufacturing operation, if needed.
+
+Competition 
+
+The Company intends to acquire brown VS + diamonds from brokers or directly from the leading diamond mines of the world located in Canada, Australia, Botswana, Russia, Democratic Republic of Congo and South Africa. Although these mines spread over five continents, are active producers of gem-quality diamonds, there is no assurance that these mines will continue to produce rough stones in sufficient quantity and at a price structure that permits uninterrupted processing by the Company. Competition by other companies for this production exists, that can affect the price to acquire the rough stones and the volume of rough stones required for the Company s processing. 
+
+Once processed by the Company and polished, the stones will be available for sale to manufactures and wholesale and retail buyers. The finished stones are known as Melee, a term used by diamond dealers to classify small diamonds. The use of diamond melee in jewelry is the largest portion of the world s diamond consumption. The Company s present intention is to sell its production through established auctions that are scheduled at locations in New York, Hong Kong, Israel, Belgium and other sites throughout the year. Auction selling is highly competitive and there is no assurance that the prices desired by the Company will be realized. The Company also plans to attend International Jewelry and Gem fairs held frequently on a Global basis. These fairs are heavily attended and highly competitive. There is no assurance that the Company s efforts at these Fairs will be successful. Sales will also be made directly to large department stores and franchised retail jewelry stores that require melee diamonds to complete their retail product. Such sales are highly competitive with other diamond dealers and there is no assurance that the Company will have the success in this sales channel it anticipates.
+
+An additional sales initiative is to provide a portion of the Company s processing capability to process for a service fee or other 
+
+Page 18
+
+arrangement rough stones of its customer. Although this initiative would produce a lower profit margin it would ensure that the total manufacturing capability of the Company was fully engaged, to the point of potentially increasing the number of shifts per Machine. The Company anticipates the least competitive pressure on this sale, but a more limited sales opportunity.
+
+Marketing Strategy 
+
+Throughout the Third Quarter of 2014 and through scaling up to 12 machines, the Company anticipates minimum marketing and advertising efforts will be needed. As production increases our marketing and advertising efforts will begin to scale as well. Initially, the Company believes that the client base developed by the Company s founders will be sufficient to satisfy the Company s selling requirements. We do anticipate that Company representatives will attend international jewelry fairs to market and advertise the Company and its products as we scale to having a full complement of 52 machines in production. Management believes that the budgeted amounts as set forth in the Use of Proceeds will be sufficient for these purposes.
+
+Employees 
+
+As of May
+
+2
+
+3
+
+, 2014, we have two (2) employees, including management. We consider our relations with our employees to be good. 
+
+Description of Property 
+
+We have recently leased new space for our administrative functions at
+
+37 West 47th Street, Suite 1301, New York, New York. We are sharing space with Ed & Serge Gold & Diamond Corp, on a joint and several basis and guaranteed by the Company s principal, Eduard Mushayev. The initial term is for five (5) years ending February 28, 2019. Rent will be payable monthly commencing May 2014 at the rate of $5,322 per month through February 28, 2015, increasing incrementally thereafter. In addition to the base rent, the Company must pay an initial base utility fee of $517.42 per month. We have also increased our leased space to 3000 square feet located at 250 Port Street, Newark, New Jersey as an initial location to house our first machine(s). A formal lease is being negotiated, and the term is presently month to month and the monthly rent obligation is $2,000, inclusive of all utilities. The Landlord has represented that additional space is available for an additional 40 machines as needed. 
+
+ 
+
+MANAGEMENT S DISCUSSION AND ANALYSIS
+
+OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+
+The following discussion of our financial condition and results of operations should be read in conjunction 
+
+with (i) our audited financial statements as of July 31, 2013 and our quarterly unaudited condensed financial statements for the period ending January 31, 2014, that appear elsewhere in this registration statement. This registration statement contains certain forward-looking statements and our future operating results could differ materially from those discussed herein. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. For information regarding risk factors that could have a material adverse effect on our business, refer to the Risk Factors section of this prospectus beginning on page 6. 
+
+Going Concern 
+
+The future of our company is dependent upon its ability to obtain financing and upon future profitable operations from the sale of the diamonds subjected to our processing. Management has plans to seek additional capital through a private placement and for public offering of its common stock, if necessary. Our auditors have expressed a going concern opinion which raises substantial doubts about our ability to continue as a going concern.
+
+Plan of Operation 
+
+The Company has an overall business plan for the coming year and generally thereafter, which calls for the introduction of additional machines into operations as funding allows, and the overall increase in related activities that flow from there. The Company has outlined operational milestones that it projects will be necessary in order to facilitate that plan. These milestones are of course subject to funding and other operational matters as they may arise. Funding that is anticipated to come from this Offering are outlined in the Company s proposed Use of Proceeds section. The Company has not currently identified the source of the acquisition funds that will be 
+
+Page 19
+
+needed to acquire any additional Machines except as identified on the Use of Proceeds. 
+
+The Company s business plan calls for the following operational milestones:
+
+ (a) Getting the first machine installed and operational - The first machine is currently located at the Company s production location at 250 Port Street, Newark, New Jersey 07114. The Company is awaiting receipt of specially ordered machine parts and expects this machine to be fully assembled and in production during the third quarter of 2014. The estimated cost of parts and labor to accomplish this is estimated to be approximately $150,000
+
+.
+
+ (b) Getting the second machine installed and operational - The second machine is currently located in Russia and it is the Company s anticipation that that machine will be shipped to its production facility in Newark by the end of the 2014 calendar year. Management estimates that shipping, installation and labor will be approximately $150,000.
+
+ (c) Acquiring and installing up to 10 additional machines during the second quarter of the 2015 calendar year; The cost of acquisition of these 10 machines, includes the purchase price, shipment to the United States, labor , parts and costs to modify the machines and related working capital, is estimated to require $10,000,000. 
+
+(d) Acquiring and installing the remaining forty (40) Machines and getting them into production in the United States. The Company anticipates that it will need $40,000,000 to acquire, ship, modify, install,, including labor and related working capital to get these additional Machines into its facility and into production and anticipates that these machines would be fully operational by the end of the 2015 calendar year.
+
+As machines are being acquired and put into production, the Company will also be focusing on the other aspects of its Business Plan such as:
+
+(a) Developing and nurturing supply lines for raw materials. Initially, The Company may enter into arrangements for the consignment of diamonds and/or in Joint venture agreements to process raw materials with others. Once sufficient revenues are earned, or sufficient funds are raised, the Company intends to increase the percentage of its own diamonds, thus increasing its profits per stone. For those areas where the Company purchases its own raw materials, they will be competitively sourced for quality, price and terms. We estimate that the monthly cost for raw materials for one machine in production will average approximately $2,000,000 depending on global market conditions at that time. Working capital availability estimated in the Use of Proceeds as well as the ability to access credit terms will be utilized to cover these costs; and 
+
+(b) Developing after markets for the HPHT stones once the process is complete. Our principal Eduard Musheyev is currently involved in the Diamond industry and has established connections that the Company intends to utilize to sell the HPHT stones once processing is complete. We will add sales channels including auctions, global wholesale and retail jewelry stores, outlets and internet sales as we add production capacity. We do not anticipate this growth prior to the second quarter of 2015. If this growth is happening and the results of operations are positive we will develop a budget for this growth based upon the Company s cash flow and results of operation being realized at that time.
+
+As part of the Company s long range goals, it also intends to pursue the following, however, these are long range goals that the Company intends to pursue if and when operations permit:
+
+1)
+
+Create a line of jewelry utilizing its own HPHT diamonds within its first 3 years of operations. It intends to utilize its Melee diamonds to design and manufacture its own line of jewelry products for large domestic retail organizations such as Costco, BJ s, JC Penny and Macy s among others as well as similar entities in the global marketplace. In establishing this line of business DTE is prepared to offer attractive, flexible and creative marketing concepts to induce these customers to purchase and sell these products.
+
+2)
+
+Attend International Jewelry Fairs that allow the Company to interact primarily with Jewelry manufacturers, designers, large franchise jewelry stores and large department stores. 
+
+3)
+
+Sell its Melee Diamonds at auction to introduce itself primarily to the Jewelry dealers. These auctions hosted by the Rapaport group attract this segment of the market at its scheduled auction sites in New York, Las Vegas, Hong Kong, Israel, Belgium, Brazil and Dubai. 
+
+4)
+
+Develop and maintain an internet magazine for internet sales of its jewelry products. Currently the Company has a basic web presence, which it does not anticipate needing to expand at this time. However, should the Company desire to begin sales over the internet, it anticipates that it would need to develop a more active web presence and would devote the necessary time and expenses needed to do so. Those costs are not predicable at this time, due to the unknown nature of when or if such a web presence would be needed.
+
+Page 20
+
+Liquidity and Capital Resources 
+
+As of July 31, 2013, we had $10,586 in current assets, consisting solely of cash. As of January 31, 2014, we had $160,774 in current assets, of which $136,015 consists of prepaid supplies and expenses and $24,759 of cash. The increase in Current Assets is a result of an increase in prepaid supplies, etc. purchased by the Company and on behalf of the company by Mr. Musheyev, consisting primarily of fabricated machines parts for the machine located in the United States.
+
+ As of July 31, 2013 we had $3,600 in current liabilities consisting of accrued expenses. As of January 31, 2014, we had $177,848 in current liabilities consisting of $58,034 in accounts payable and accrued expenses; $109,589 in stock based payable and $10,226 in advances from Mr. Musheyev, which advances were partially utilized by the Company to purchase the fabricated parts for the US machine. As of July 31, 2013 we had no long-term debt. As of January 31, 2014, we had $161,765 long-term debt received from Mr. Musheyev with a maturity date of 5 years. 
+
+We have no material commitments for the next twelve months, aside from salaries and rent on the necessary commercial space. We will however require additional capital to meet our liquidity needs. The Company has determined that its anticipated monthly cash flow needs should not exceed of $500,000 per month for the next 12 months, based on a 12 Machines being up and functioning. Expenses are expected to increase in 2014 due to a projected need to increase personnel, purchase raw materials, and purchase and install new Machines. 
+
+The Company s projected capital needs and its projected increase in expenses are based upon the Company s projected acquisition of additional Machines over the coming 12 months, regardless of how much is raised in this offering, the Company will need to rely on private financing to acquire additional Machines, through operating debt or possibly a leasing facility, none of which has yet been identified, The Company s success depends upon its ability to increase the number of Machines in service. 
+
+It is estimated that the expense to the Company of each new Machine is approximately $720,000 per Machine. This estimation includes the acquisition costs, delivery to the U.S., including shipping, duties, customs, insurance, and the installation expense. These are estimations only and could vary greatly, as the components are subject to pricing by third parties over which we have no control. 
+
+The Principal of the Company, Eduard Musheyev, has provided financing to the company from his own personal funds to date, and has expressed that he intends to continue to do so until such time as the company becomes sufficiently funded or self-supporting. There is no formal agreement in place to provide said financing. 
+
+Fixed expenses are minimal management has thus far provided a substantial portion of the company s operating needs, and intends to keep doing so in the future, in the event that funds cannot be obtained through traditional sources.
+
+We anticipate that we will receive sufficient proceeds from investors through this offering, to continue operations for at least the next six (6) months; however, there is no assurance that such proceeds will be received and there are no agreements or understandings currently in effect from any potential investors. It is anticipated that the company will receive increasing revenues from operations in the coming year, however, since the Company has not earned revenues to date, it is difficult to anticipate what those revenues might be, if any, and therefore, management has assumed for planning purposes only that it may need to sell common stock, take loans or advances from officers, directors or shareholders or enter into debt financing agreements in order to meet our cash needs over the coming twelve months. The Issuer has no agreements or understandings for any of the above-listed financing options, aside from that of Mr. Vladimirovich. 
+
+The Use of Proceeds section includes a detailed description of the use of proceeds over the differing offering scenarios of 100%, 75%, 50% and 25%. As the Company s expenses are relatively stable, unless additional Machines are purchased, the Company believes it can fund its present operations with projected revenues together with offering proceeds under any of the offering scenarios. If necessary, Management has indicated that it intends to continue to fund shortfalls as needed. In addition, the Company will consider raising additional funds during 2014 through sales of equity, debt and possibly convertible securities, if it is deemed necessary.
+
+Diamond Technology Enterprises, Inc. has no intention of investing in short-term or long-term discretionary financial programs of any kind. 
+
+Results of Operations 
+
+We did not generate any revenue from January 14, 2013 (inception) to January 31, 2014. For the period ending July 31, 2013, our expenses were $58,188 and for the three and six-months ending January 31, 2014 our expenses were $90,838 and $257,386, respectively. Expenses consisted of those related to accounting, legal, travel and other professional fees. As a result, we have reported a net loss of $58,188 for the period ending July 31, 2013 and a net loss for the three and six months ended January 31, 2014 of $90,838 and 
+
+Page 21
+
+$257,386, respectively. Our total net loss from inception (January 14, 2013) through January 31, 2014 was $315,574. 
+
+Our auditors have expressed a going concern opinion which raises substantial doubts about the Issuers ability to continue as a going concern.
+
+Off-Balance Sheet Arrangements 
+
+We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. 
+
+ 
+
+Critical Accounting Policies 
+
+Our financial statements and accompanying notes have been prepared in accordance with United States 
+
+generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in 
+
+conformity with U.S. generally accepted accounting principles requires management to make estimates and 
+
+assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and 
+
+liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the 
+
+reporting periods. 
+
+We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management. 
+
+Cash and Cash Equivalents. The Company considers all highly liquid short-term investments with maturities of less than three months when acquired to be cash equivalents. 
+
+Equipment, Furniture and Leasehold Improvements. Equipment, furniture and leasehold improvements are recorded at cost and depreciated on a straight-line basis over the lesser of their estimated useful lives, ranging from three to seven years, or the life of the lease, as appropriate. 
+
+Impairment of Long-Lived Assets. Long-lived assets are reviewed for impairment whenever events or 
+
+changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows expected to be generated by such assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the discounted expected future net cash flows from the assets. 
+
+Revenue Recognition. The Company will recognize revenue when all four of the following criteria are met: (i) persuasive evidence that an arrangement exists; (ii) delivery of the products and/or services has occurred; (iii) the fees earned can be readily determined; and (iv) collectability of the fees is reasonably assured. The Company will recognize revenue from research contracts as services are performed under the agreements. 
+
+Research and Development. All market research and website development costs, including all related salaries, and facility costs are charged to expense when incurred. 
+
+Loss Per Common Share. Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. 
+
+OUR MANAGEMENT
+
+Executive Officers 
+
+Name
+
+Age
+
+Position
+
+Eduard Musheyev
+
+ 51
+
+Chief Executive Officer/President
+
+Jordan Friedberg
+
+ 59
+
+Chief Financial Officer
+
+Directors and Executive Officers
+
+Eduard Musheyev
+
+Chairman of the Board, Director, President, and Secretary 
+
+Eduard Musheyev (51) was born in Tashkent Uzbekistan. Upon immigrating to the United States in the early 1980 s, Mr. Musheyev was employed in the design and manufacturing of jewelry. Thereafter, he founded his first successful company in the retail jewelry sector where he built up an extensive network of wholesale and retail customers. 
+
+In 1990, Mr. Musheyev opened his retail jewelry operation in New York City, and within five years had expanded to eight retail stores within the New York City area. He then established his wholesale jewelry operation, in New York City s jewelry district. Mr. Musheyev continues to excel in his retail and wholesale operations, operating Ed & Serge Gold & Diamond Corp. He has over 30 years experience in the gold and jewelry industry, Mr. Musheyev has vast knowledge and hands on experience in the purchasing and selling of precious stones, with a specific emphasis on Diamonds. Aside from the Registrant, over the last five years, Mr. Musheyev has been involved with the following companies in the capacities indicated: 
+
+Company
+
+Position
+
+From / To:
+
+ESM Taxi, LLC
+
+CEO/Owner
+
+4/8/13 - Present
+
+Ed & Serge Gold & Diamonds Corp
+
+CEO/Owner
+
+3/20/08 - Present
+
+ESM Pawn Brokers, Inc. (dormant company)
+
+CEO 
+
+5/3/12 - Present
+
+ESM Refiners, Inc.
+
+CEO/Owner
+
+4/17/09-7/25/09
+
+GoldExCom, Inc.
+
+CEO/Owner
+
+9/12/10- 2011
+
+EZ Sell Gold and Diamonds Corp.
+
+CEO/Owner
+
+9/23/09-7/31/13
+
+ESM Refiners Arizona, Inc.
+
+CEO/Owner
+
+3/12/10-9/12/10
+
+EZ Sell Gold.com
+
+CEO/Owner
+
+6/28/08-12/28/11
+
+Caseycorp.
+
+CEO/Shareholder
+
+ 2009 - 2013
+
+Board of Directors 
+
+Nikitin Vadim Vladimirovich 
+
+Nikitin Vadim Vladimirovich (47) was born in Barnaul, Altai Krai Russia in 1966. Mr. Vladimirovich graduated from high school in 1983 and immediately entered the Rostov Higher Military Engineering School of Missile Base, where he graduated in 1988 as a lieutenant and was deployed to serve in the city of Bryansk as a design engineer in the Special Technical Design Bureau. In 1991, he graduated from military service and moved to Smolensk, where he began duties as deputy chief of lease with the bank "Titan". At the same time, Mr. Vladimirovich opened his own private enterprise of banking. . In 1993 he received an invitation to work at the State Research and Production Space Center Khrunichev, in a position as the chief engineer of a plant with machine missiles. 
+
+From 1995 Mr. Vladimirovich returned to his private business, opening the company CJSC "Scientific-Production Center Promavtomatika." During that time Mr. Vladimirovich started to acquire interests in the purchasing and processing of precious stones in Africa. Since about 2000, Mr. Vladimirovich has been involved in technology to improve the color of crystals with HPHT technology, combining the knowledge and experience as an engineer and businessman. In 2007 Mr. Vladimirovich started a contract for the supply of diamonds to the Mint Goznak (Federal Reserve of the Russian Federation) . By 2010, Mr. Vladimirovich had opened up his newest company Diamond Club and has been successfully making a living with the purchasing and reselling of precious diamonds. Mr. Vladimirovich has also made relationships with partners in the United States and has begun business transactions dealing with jewelry and diamonds between both countries.
+
+In 2011-Present Mr. Vladimirovich has been working in sync with his American partners on implementing the HPHT process and setting up an operation in the United States. Mr. Vladimirovich personally oversees the packaging and shipment of each machine that comes into the U.S. Furthermore Mr. Vladimirovich has been upgrading the machinery to perform at a faster and more efficient pace, using his engineering expertise in this field. The majority of Mr. Vladimirovich s time is now spent working on Diamond Technology Enterprises. 
+
+Page 23
+
+Vadim Nikitin currently lives in Moscow, is married with two children.
+
+Jordan S. Friedberg, Chief Financial Officer, Treasurer, Board of Directors Member
+
+Jordan Friedberg has over 28 years of experience in production and post production management. He has strong financial analytical business skills in all areas of accounting, forensic accounting, budgeting, and finance. He has worked with innovative leaders in both film and video post production and production. Jordan has been a CFO for many companies including, VISUALIZE / Pacific Ocean Post (12/89-3/94), Prime Time Post (3/82-4/85), Phoenix Books (6/04-4/10), Cinema Research Inc. (1/97-3/00), and Accounting Director for ABC (8/89-3/94), and CFO/Associate Producer for Filmroos (3/94-1/97). He has been an Associate Producer of more than 480 hours of productions for television including, Discovery Channel, History Channel, ABC TV, Learning Channel, and A&E, and several independent films. Mr. Friedberg holds an MBA from Pepperdine University. In addition he has a consulting company Aremac Consultants, LLC, founded in May 2003, specializing in budgets, financial analysis, mergers and or restructure modeling primarily in the film and television production / postproduction industry Services include, Forensic Accounting, Expert Witness Testimony and Advice, as well as Financial Investigation, consulting services to insurance providers, the banking and accounting communities, leasing companies, production, postproduction, and sound companies, film laboratories, and digital facilities, in all segments of the film and television industry. 
+
+Mr. Friedberg has also served as Advisory Board Member and Board of Director for the BEL-AIR FILM FESTIVAL (08-Present) and an original Executive Producer / Board of Directors for RADD/Recording Artists, and Actors & Athletes Against Drunk Driving (86-Present).
+
+Family Relationships. There are no family relationships among the directors and executive officers of the company. 
+
+Code of Conduct and Ethics. We have not adopted a code of business conduct and ethics that applies to our directors, officers and all employees. 
+
+Executive Compensation 
+
+Summary Compensation Table. The following table sets forth certain information concerning the annual and long-term compensation of our Chief Executive Officer and our other executive officers during the last fiscal year and for the last two fiscal years. 
+
+ 
+ 
+ 
+(a)
+
+(b)
+
+(c)
+
+ 
+
+Name and Principal Position
+
+Year
+
+Salary
+
+Bonus
+
+Option
+
+Awards
+
+All Other Compensation**
+
+Total Compensation
+
+Eduard Musheyev
+
+Chairman of the Board, 
+
+2013
+
+-0-
+
+-0-
+
+-0-
+
+-0-
+
+-0-
+
+President, Secretary
+
+2014
+
+TBD
+
+TBD
+
+TBD
+
+-0-
+
+TBD
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Jordan S. Friedberg
+
+2013
+
+-0-
+
+-0- 
+
+-0-
+
+661,000 shares
+
+661,000 shares
+
+Chief Financial Officer
+
+ 
+ 
+ 
+ 
+Common 
+
+Common
+
+ 
+2014
+
+TBD
+
+TBD
+
+TBD
+
+-0-
+
+TBD
+
+ 
+
+** Stock issuances valued at $66,100
+
+TBD To Be Determined means that the Company intends to provide compensation to its principal officers during the course of 2014 if the Company s finances permit.
+
+Deferred Stock Issuance. Effective July 15, 2013 we entered into a consulting/servicing agreement with David A. Mortman that obligates the Company to issue to Mr. Mortman 2,000,000 shares of common stock at the one year anniversary of the agreement for services rendered. Mr. Mortman has provided and continues to provide strategic business advice to the Company specifically relating to pre-operational issues, e.g. leasehold facilities for the executive offices and manufacturing facilities required by the company, investigating various leasehold locations for those purposes, meetings with brokers and landlord representatives, reviewing personnel requirements to implement the business plan, discussing the best options available for the purchase of raw materials. Mr. Mortman has also provided services in the business review of the Company s Form S-1 and has prepared an ongoing business plan for the management and operation of the Company. Mr. Mortman will also assist in the negotiations on behalf of the Company with financing sources. 
+
+Page 24
+
+At the formation of the Company we agreed to issue to Nikitin Vadim Vladimirovich 34,500,000 shares of common stock upon the fulfillment of his obligations to the Company. His obligations consist of facilitating the acquisition of the additional machines needed to increase production (up to 50 more machines) and to ensure the adaption of the machines for our purposes. This is disclosed under related party transactions below. 
+
+Deferred Salary. There is a written deferred salary agreement in place at this time with Jordan Friedberg. The deferred salary will be paid at such time as the Company is financially able. To date no difference salary has been earned.
+
+ 
+
+Outstanding Equity Awards at Fiscal Year End. There were no outstanding equity awards as of January 31, 2014.
+
+Compensation of Non-Employee Directors. We currently have no non-employee directors and no compensation was paid to non-employee directors in the period ended January 31, 2014. We intend to identify qualified candidates to serve on the Board of Directors and to develop a compensation package to offer to members of the Board of Directors and its Committees. 
+
+Audit, Compensation and Nominating Committees. As noted above, we intend to apply for listing our common stock on the OTC Electronic Bulletin Board, which does not require companies to maintain audit, compensation or nominating committees. The company s shares may never be quoted on the OTC Bulletin Board or listed on an exchange. Considering the fact that we are an early stage company, we do not maintain standing audit, compensation or nominating committees. The functions typically associated with these committees are performed by the entire Board of Directors which currently consists of one member who is not considered independent. 
+
+SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+
+Security Ownership of Principal Stockholders, Directors, Nominees and Executive Officers and Related Stockholder Matters 
+
+The following table sets forth, as of May
+
+2
+
+1, 2014, certain information with respect to the beneficial ownership of shares of our common stock by: (i) each person known to us to be the beneficial owner of more than five percent (5%) of our outstanding shares of common stock, (ii) each director or nominee for director of our Company, (iii) each of the executives, and (iv) our directors and executive officers as a group. Unless otherwise indicated, the address of each shareholder is c/o our company at our principal office address:
+
+Beneficial Owner
+
+Address
+
+Number of Shares Beneficially Owned (*)
+
+Percent of Class (**)
+
+Summit Trading Limited
+
+Voting Control held: Charles Arnold
+
+Southeast Research Partners, LLC
+
+Voting Control held: David Kugelman 
+
+120 Flagler Ave
+
+New Smyrna Beach, FL 32169
+
+507 N. Little Victoria Rd, Woodstock, GA 30189
+
+5,000,000
+
+5,000,000
+
+7.40%
+
+7.40%
+
+Prosper Capital, Inc.
+
+Voting Control held: Alex Kozlovski
+
+2719 Coney Island Ave., Brooklyn, NY 11235
+
+7,000,000
+
+10.36%
+
+Sierra Trading Group
+
+Voting Control held: Daisy Rodriguez
+
+Azim Gafurov 
+
+* Nikitin Vadim Vladimirovich
+
+*Jordan Friedberg
+
+*Eduard Musheyev
+
+520 Brickell Key Dr., #1607, Miami, FL 33131
+
+Mira St., #4, City of Hudjant, Republic of Tajkistan 73570
+
+21 West 47th St., #24, New York, NY 10036
+
+1803 N. Beverly Glen Blvd., Los Angeles, CA 90077
+
+21 West 47th St., #24, New York, NY 10036
+
+7,000,000
+
+6,600,000
+
+760,000
+
+661,000
+
+Common 29,100,000
+
+Preferred Series A 1,000,000
+
+10.36%
+
+9.77%
+
+1.12%
+
+0.98%
+
+43.06%
+
+100%
+
+*All Directors and Officers as a Group 
+
+(3 persons)
+
+Common 30,521,000
+
+Series A Convertible Preferred 1,000,000
+
+45.17%
+
+100%
+
+(*) Beneficial ownership is determined in accordance with the rules of the SEC which generally attribute beneficial ownership of securities to persons who possess sole or shared voting power and/or investment power with respect to those securities. Unless otherwise indicated, voting and investment power are exercised solely by the person named above or shared with members of such person s household. This includes any shares such person has the right to acquire within 60 days.
+
+(**) Percent of class is calculated on the basis of the number of shares outstanding on May
+
+2
+
+1, 2014 (67,575,000). 
+
+CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
+
+It is our practice and policy to comply with all applicable laws, rules and regulations regarding related person transactions, including the Sarbanes-Oxley Act of 2002. A related person is an executive officer, director or more than 5% stockholder of Diamond Technology Enterprises, Inc., including any immediate family members, and any entity owned or controlled by such persons. Our Board of Directors (excluding any interested director) is charged with reviewing and approving all related-person transactions, and a special committee of our Board of Directors is established to negotiate the terms of such transactions. In considering related-person transactions, our Board of Directors takes into account all relevant available facts and circumstances. 
+
+Loans and Advances from Affiliates 
+
+Through July 31, 2013 Eduard Musheyev, personally paid Company expenditures aggregating $30,749. The Company s officers and shareholders have contributed capital to the Company for working capital purposes, paid expenses incurred on behalf the Company and contributed equipment since the Company s inception in January 2013 in aggregate of $745,559, consisting of $688,833 in January 2013 for the Machine that was purchased and shipped to the United States; and $30,749 expenses such as legal, accounting and other ancillary expenses and contributed cash to the Company of $25,975. 
+
+The aggregate contributions are reflected as additional paid in capital in the Company s financial statements. 
+
+In January 2013, Eduard Musheyev, our founder and a member of our board of directors contributed one Machine valued at $688,833 to the Company and in May 2013, Nikitin Vadim Vladimirovich ( Nikitin ) sold one additional machine to the Company in exchange for 760,000 shares of common stock. The machine was acquired by Nikitin from an unrelated third party on May 17, 2012, for 
+
+Page 26
+
+approximately 42,000,000 Russian rubles (the equivalent of $1,400,000). The Company and Nikitin entered into an agreement on May 1, 2013 whereby the Company agreed to issue 760,000 shares of its common stock valued at $1.00 per share in exchange for the machine. The number of shares issued and the assigned value of $ 1.00 per share was negotiated by the two parties based in part on the Company s start-up status at the time the agreement was entered into. Mr. Vladimirovich was not an affiliate at the time of this acquisition. Mr. Vladimirovich and the Company have also agreed once the Company obtained working capital of One Million Five Hundred Thousand Dollars and financing to obtain the first ten (10) Machines, Mr. Vladirmirovich would be issued 17,250,000 additional shares of the Company s common stock. Further, upon the Company acquiring another forty (40) Machines he would be issued an additional 17,250,000 shares of the Company s common stock. This agreement has not been reduced to writing. 
+
+During the quarter ended January 31, 2014, the Company issued varies notes payable totaling $161,765 to Eduard Musheyev, the Company s Chief Executive Officer, for advances and costs incurred on the behalf of the Company. The notes are due on or before five years from the date thereof and accrue interest at the rate of 4% per annum, payable monthly. Late fee is applicable in the amount of 5% of the amount due.
+
+On February 7, 2014
+
+, the Company issued a $15,000 related party note payable to Eduard Musheyev, the Company s Chief Executive Officer, for advances and costs incurred on the behalf of the Company. The note is due on or before five years from the date of issuance, at interest at 4% per annum, payable monthly, in arrears. Late fee is applicable in the amount of 5% of the amount due.
+
+On February 12, 2014
+
+, the Company issued a $45,000 related party note payable to Eduard Musheyev, the Company s Chief Executive Officer, for advances and costs incurred on the behalf of the Company. The note is due on or before five years from the date of issuance, at interest at 4% per annum, payable monthly, in arrears. Late fee is applicable in the amount of 5% of the amount due.
+
+Director Independence 
+
+Our Board of Directors has adopted the definition of independence as described under the Sarbanes Oxley Act of 2002 (Sarbanes-Oxley) Section 301, Rule 10A-3 under the Securities Exchange Act of 1934 (the Exchange Act) and NASDAQ Rules 4200 and 4350. Our Board of Directors has determined that its members do not meet the independence requirements. 
+
+DESCRIPTION OF CAPITAL STOCK
+
+Authorized and Issued Stock
+
+Number of Shares at May
+
+2
+
+1, 2014
+
+Title of Class
+
+Authorized
+
+Outstanding
+
+Common stock, $0.0001 par value per share
+
+240,000,000
+
+67,575,000
+
+Preferred Stock, $0.0001 par value per share
+
+ 10,000,000
+
+ 1,000,000
+
+Common stock 
+
+Dividends. Each share of common stock is entitled to receive an equal dividend, if one is declared, which is unlikely. We have never paid dividends on our common stock and do not intend to do so in the foreseeable future. We intend to retain any future earnings to finance our growth. See Risk Factors. 
+
+Liquidation. If our company is liquidated, any assets that remain after the creditors are paid, and the owners of preferred stock receive any liquidation preferences, will be distributed to the owners of our common stock pro-rata. 
+
+Voting Rights. Each share of our common stock entitles the owner to one vote. There is no cumulative voting. A simple majority can elect all of the directors at a given meeting and the minority would not be able to elect any directors at that meeting. 
+
+Preemptive Rights. Owners of our common stock have no preemptive rights. We may sell shares of our common stock to third parties without first offering it to current stockholders. 
+
+Page 27
+
+Redemption Rights. We do not have the right to buy back shares of our common stock except in extraordinary transactions such as mergers and court approved bankruptcy reorganizations. Owners of our common stock do not ordinarily have the right to require us to buy their common stock. We do not have a sinking fund to provide assets for any buy back. 
+
+Conversion Rights. Shares of our common stock cannot be converted into any other kind of stock except in extraordinary transactions, such as mergers and court approved bankruptcy reorganizations. 
+
+Preferred stock 
+
+The Company is authorized to issue 10,000,000 shares of Preferred Stock. The Company has designated 1,000,000 shares as Series A Convertible Preferred Stock with the following rights and privileges: 
+
+Dividends. Each share of Series A Convertible Preferred stock is entitled to receive an equal dividend with the Company s common stock, if one is declared. We have never paid dividends on our common stock and do not intend to do so in the foreseeable future. We intend to retain any future earnings to finance our growth. 
+
+Liquidation. Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, each share of Series A Convertible Preferred is entitled to receive, on a pro-rata basis, an amount equal to Stated Value per share before any distribution or payment to any other class of shareholders. 
+
+Voting Rights. Each share of our Series A Convertible Preferred stock entitles the owner to one hundred (100) votes on all matters presented to be voted on by the holders of the common stock. There is no cumulative voting. 
+
+Preemptive Rights. Owners of our Series A Convertible Preferred stock have no preemptive rights. We may sell shares of our Series A Convertible Preferred stock to third parties without first offering it to current stockholders. 
+
+Redemption Rights. We do not have the right to buy back shares of our Series A Convertible Preferred stock except in extraordinary transactions such as mergers and court approved bankruptcy reorganizations. Owners of our Series A Convertible Preferred stock do not ordinarily have the right to require us to buy their Series A Convertible Preferred stock. We do not have a sinking fund to provide assets for any buy back. 
+
+Conversion Rights. Each share of our Series A Convertible Preferred may, at any time, and from time to time, convert each share into a number of fully paid and nonassesable shares of Common stock at a one to one conversion. 
+
+Delaware Anti-Takeover Laws 
+
+Some features of the Delaware corporate code, which are further described below, may have the effect of deterring third parties from making takeover bids for control of our company or may be used to hinder or delay a takeover bid. This would decrease the chance that our stockholders would realize a premium over market price for their shares of common stock as a result of a takeover bid. 
+
+Acquisition of Controlling Interest. Delaware s antitakeover statute, as codified at Section 203 of the Delaware General Corporate Law prevents a hostile bidder from completing a back-end merger with the target company for three years after buying more than 15% of the target s shares unless: (1) the bidder gains approval of the target board in advance; (2) the bidder goes from less than 15% ownership of the target to more than 85% ownership in a single tender offer; or (3) the bidder gains approval from two-thirds of the disinterested shares after buying more than 15%. When Section 203 was enacted in 1988, three hostile bidders for Delaware targets challenged its constitutionality on the grounds that the statute was preempted by the Williams Act, among other things. In all three of these cases, the federal district court upheld the constitutionality of Section 203, concluding from the available evidence that Section 203 gave bidders a meaningful opportunity for success and therefore did not disrupt the balance between bidders and targets that Congress envisioned. 
+
+Our bylaws provide that the company may indemnify its officers, directors, agents and any other persons to the fullest extent permitted by Delaware General Corporate Law. 
+
+SELLING STOCKHOLDERS
+
+An aggregate of 2,987,820 shares of common stock may be offered for sale and sold from time to time pursuant to this prospectus by the Selling Stockholders.
+
+Page 28
+
+The term Selling Stockholders includes the stockholders listed below and their pledgees, assignees or other successors-in-interest. We have agreed to register all of the shares offered hereby for resale by the Selling Stockholders under the Securities Act and to pay all of the expenses in connection with such registration and the sale of the shares, other than selling commissions and the fees and expenses of counsel and other advisors to the Selling Stockholders. Information concerning the Selling Stockholders may change from time to time, and any changed information will be set forth if and when required in prospectus supplements or other appropriate forms permitted to be used by the SEC.
+
+Except as disclosed under this prospectus, none of the Selling Stockholders has held a position or office or had a material relationship with us within the past three years other than as a result of the ownership of our common stock or other securities.
+
+The following table sets forth, for each of the Selling Stockholders to the extent known by us, the number of shares of our common stock beneficially owned, the number of shares of our common stock offered hereby and the number of shares and percentage of outstanding common stock to be owned after completion of this offering, assuming all shares offered hereby are sold.
+
+Unless otherwise indicated, the Selling Stockholders have sole voting and investment power with respect to their shares of common stock. All of the information contained in the table below is based upon information provided to us by the Selling Stockholders, and we have not independently verified this information. The Selling Stockholders may have sold, transferred or otherwise disposed of, or may sell, transfer or otherwise dispose of, at any time or from time to time since the date on which it provided the information regarding the shares beneficially owned, all or a portion of the shares beneficially owned in transactions exempt from the registration requirements of the Securities Act.
+
+None of the Selling Stockholders, including those that are not natural persons, are broker-dealers or affiliates of broker-dealers. 
+
+The number of shares outstanding and the percentages of beneficial ownership are based on 67,575,000 shares of our common stock issued and outstanding as of May 
+
+2
+
+3
+
+, 2014.
+
+For the purposes of the following table, the number of shares of our common stock beneficially owned, has been determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the Exchange Act ) and such information is not necessarily indicative of beneficial ownership for any other purpose. Under Rule 13d-3, beneficial ownership includes any shares as to which a selling stockholder has sole or shared voting power or investment power and also any shares which that selling stockholder has the right to acquire within 60 days of the date of this prospectus through the exercise of any stock option, restricted stock unit, warrant or other rights.
+
+Name
+
+Number of Shares of Common Stock Beneficially Owned Prior to Offering(1)
+
+Percentage of Shares Beneficially owned Prior to Offering
+
+Number of Shares of Common Stock Being Offered
+
+Shares of Common Stock Beneficially Owned After the Offering(1)
+
+Percentages Beneficially Owned After the Offering
+
+Southeast Research Partners, LLC Voting Control held by: David Kugelman
+
+5,000,000
+
+7.40%
+
+1,466,910
+
+3,533,090
+
+5.23%
+
+Summit Trading Voting Control held by: Charles Arnold
+
+5,000,000
+
+7.40%
+
+1,466,910
+
+3,533,090
+
+5.23%
+
+Weinstein, Harold
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Natmark Inc. Voting Control held by: Mark Suleymanov
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Omnivest Holdings Inc. Voting Control held by: Nisim Bababekov
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Paltielov, Efraim
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Paltielov, Neris
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Kogan, Alex
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Gogus, Alexey
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Kaplan, Benjamin
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Mitroo, Jagdish B
+
+5,000
+
+*
+
+5,000
+
+0
+
+0
+
+Grinberg, Robert
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Binman, Albert
+
+3,000
+
+*
+
+3,000
+
+0
+
+0
+
+NIFO Holdings LLC Main Account Voting Control held by: Nisim Bababekov
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Stefansky, David
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Zeorov, Boris
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Liston, Jennifer C
+
+5,000
+
+*
+
+5,000
+
+0
+
+0
+
+OTC Mailers Inc. Voting Control held by: Alex Kozlovski
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Reds Group, Inc. Voting Control held by: Roman Suleymanov 
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Mosheyev, Vladimir
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Yusupov, Isak
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Aronov, Zoya
+
+2,000
+
+*
+
+2,000
+
+0
+
+0
+
+Gutierrez, Sofia
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Kandhorov, Abram
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Kandhorov, Sam
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Mitroo, Sumair
+
+5,000
+
+*
+
+5,000
+
+0
+
+0
+
+Natanel, Lylla
+
+3,000
+
+*
+
+3,000
+
+0
+
+0
+
+Yusupov, Allison
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Yusupov, Elizabeth
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Yusupov, Raphael M
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Gutierrez, Julio C
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+CTW Investments, LLC Voting Control held by: Harold Wrinstein
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+H&H Diamonds Voting Control held by: Harold Wrinstein
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+T&C Global Investments, LLC Voting Control held by: Harold Wrinstein
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Niyazov, Ariel A.
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Ilyasov, Igor
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Katanov, Daniel
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Katanov, Vladimir
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+Natalya, Katanova
+
+1,000
+
+*
+
+1,000
+
+0
+
+0
+
+(1)
+
+The number of shares listed in these columns includes all shares beneficially owned by the selling stockholder. 
+
+(2)
+
+* Less than 1%
+
+PLAN OF DISTRIBUTION
+
+By Selling Stockholders 
+
+The selling stockholders and any of its pledgees, donees, transferees, assignees and successors-in-interest may, from time to time, sell any or all of its shares of common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions. The selling stockholder may use any one or more of the following methods when selling shares: 
+
+ 
+
+ordinary brokerage transactions and transactions in which the broker-dealer solicits investors; 
+
+ 
+
+block trades in which the broker-dealer will attempt to sell the shares as agent but may position and 
+
+resell a portion of the block as principal to facilitate the transaction; 
+
+ 
+
+purchases by a broker-dealer as principal and resale by the broker-dealer for its account; 
+
+ 
+
+an exchange distribution in accordance with the rules of the applicable exchange;
+
+ 
+
+privately negotiated transactions; 
+
+ 
+
+to cover short sales made after the date that this Registration Statement is declared effective by the 
+
+Commission; 
+
+ 
+
+broker-dealers may agree with the selling stockholder to sell a specified number of such shares at a 
+
+stipulated price per share; 
+
+ 
+
+a combination of any such methods of sale; and 
+
+ 
+
+any other method permitted pursuant to applicable law. 
+
+Page 31
+
+The selling stockholder may also sell shares under Rule 144 promulgated under the Securities Act, or another exemption from the registration requirements under the Securities Act, if available, rather than under this prospectus. 
+
+The issuer and the selling shareholders will sell the common stock being registered in this offering at a fixed price of $1.00 per share for the duration of the offering. The company s shares may never be quoted on the OTC Bulletin Board or listed on an exchange. If the offering is not already closed at the time, the Issuer will file a post-effective amendment to reflect the change to a market price when the shares begin trading on a market or exchange.
+
+Broker-dealers engaged by the selling stockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the selling stockholder (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated. 
+
+The selling stockholders may from time to time pledge or grant a security interest in some or all of the 
+
+Shares owned by it and, if it defaults in the performance of their secured obligations, the pledgees or secured parties 
+
+may offer and sell shares of common stock from time to time under this prospectus, or under an amendment to this 
+
+prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act of 1933 amending the list of 
+
+selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under 
+
+this prospectus. 
+
+Upon the company being notified in writing by a selling stockholder that any material arrangement has 
+
+been entered into with a broker-dealer for the sale of common stock through a block trade, special offering, 
+
+exchange distribution or secondary distribution or a purchase by a broker or dealer, a supplement to this prospectus 
+
+will be filed, if required, pursuant to Rule 424(b) under the Securities Act, disclosing (i) the name of each such 
+
+selling stockholder and of the participating broker-dealer(s), (ii) the number of shares involved, (iii) the price at 
+
+which such the shares of common stock were sold, (iv) the commissions paid or discounts or concessions allowed to 
+
+such broker-dealer(s), where applicable, (v) that such broker -dealer(s) did not conduct any investigation to verify the 
+
+information set out or incorporated by reference in this prospectus, and (vi) other facts material to the transaction. In 
+
+addition, upon the company being notified in writing by a selling stockholder that a donee or pledgee intends to sell 
+
+more than 500 shares of common stock, a supplement to this prospectus will be filed if then required in accordance 
+
+with applicable securities law. 
+
+The selling stockholder also may transfer the shares of common stock in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus. 
+
+The selling stockholders may be deemed to be underwriters within the meaning of the Securities Act in connection with such sales. Because the selling stockholder may be deemed to be an underwriter within the meaning of the Securities Act, they will be subject to the prospectus delivery requirements of the Securities Act. Discounts, concessions, commissions and similar selling expenses, if any, that can be attributed to the sale of Securities will be paid by the selling stockholder and/or the purchasers. The selling stockholder has represented and warranted to the company that it acquired the securities subject to this registration statement in the ordinary course of the selling stockholder s business and, at the time of its purchase of such securities the selling stockholder had no agreements or understandings, directly or indirectly, with any person to distribute any such securities. 
+
+The company has advised the selling stockholders that it may not use shares registered on this Registration 
+
+Statement to cover short sales of common stock made prior to the date on which this Registration Statement shall 
+
+have been declared effective by the Commission. If the selling stockholder uses this prospectus for any sale of the 
+
+common stock, it will be subject to the prospectus delivery requirements of the Securities Act. The selling stockholder will be responsible to comply with the applicable provisions of the Securities Act and Exchange Act, 
+
+and the rules and regulations thereunder promulgated, including, without limitation, Regulation M, as applicable to 
+
+such selling stockholder in connection with resales of their respective shares under this Registration Statement. 
+
+The company is required to pay all fees and expenses incident to the registration of the shares, but the company will not receive any proceeds from the sale of the common stock by selling stockholders. The company has agreed to indemnify the selling stockholder against certain losses, claims, damages and liabilities, including liabilities under the Securities Act. 
+
+By Our Company 
+
+We may sell the shares of our common stock subject to this prospectus from time to time in any manner permitted by the Securities Act
+
+.
+
+,
+
+The Company is conducting the primary offering on a self-underwritten, best efforts basis. We are not required to sell a specific number of our securities, but we will use our best efforts. The proceeds from the sale of these shares will be immediately available for use by the Company. The Company does not intend to place the funds from the sale of its securities in escrow, trust, or similar account. There is no minimum offering amount and we have not established an escrow to hold any of the proceeds from the sale of the shares offered by the Company. As a result, all proceeds from the sale of shares offered by the Company will be available for immediate use by the Company. The proceeds of the sale may not be sufficient to implement the Company s business strategy. The effect on investors is the Company will receive full use of the funds, while the investor may find that they are one of few that purchased the securities offered; making the resale market limited or even non-existent due to limited interest in our security. The investor may find that they need to hold the investment for an extended period of time, or even find a market never develops for the security. 
+
+Shares of the Company s common stock registered hereunder may be sold by Officers and/or Directors of the company that have been appointed to that function who have been specifically permitted to sell the Company s shares. No person will be permitted to sell the company s shares who is themselves or who is an associated person of a broker or dealer within the prior twelve (12) months; or who has been subject to a statutory disqualification as defined in section 3(a)(39) of the Act. No Company employee/officer or director will be compensated by commissions or other remuneration based either directly or indirectly on any such transactions. All sales by the company s officer, directors or employees will be conducted in accordance with the requirements of the safe harbor found in Exchange Act Rule 3a-41. 
+
+Shares of common stock sold pursuant to the registration statement of which this prospectus is a part may 
+
+not be listed or traded on any exchange or automated quotations system, but may be listed on the OTC Electronic 
+
+Bulletin Board. The company s shares may never be quoted on the OTC Bulletin Board or listed on an exchange. 
+
+Each time we sell shares, we will describe the method of distribution of the shares in the prospectus supplement relating to such transaction. 
+
+Until the distribution of the securities is completed, rules of the SEC may limit the ability of any 
+
+underwriters and selling group members to bid for and purchase the securities. As an exception to these rules, underwriters are permitted to engage in some transactions that stabilize the price of the securities, such as over allotment, stabilizing transactions, short covering transactions and penalty bids in accordance with Regulation M under the Securities Exchange Act of 1934. Over allotment involves sales in excess of the offering size which create a short position. Stabilizing transactions consist of bids or purchases for the purpose of pegging, fixing or maintaining the price of the securities. Short covering transactions involve purchases of the securities in the open market after the distribution is completed to cover short positions. The underwriters may also impose a penalty bid, under which selling concessions allowed to syndicate members or other broker-dealers for securities sold in the offering for their account may be reclaimed by the syndicate if the securities are repurchased by the syndicate in stabilizing or covering transactions. In general, purchases of a security for the purpose of stabilization or to reduce a short position could cause the price of the security to be higher than it might be in the absence of such purchases. The imposition of a penalty bid might also have an effect on the price of a security to the extent that it were to discourage resales of the security before the distribution is completed. 
+
+We do not make any representation or prediction as to the direction or magnitude of any effect that the transactions described above might have on the price of the securities. In addition, we do not make any representation that underwriters will engage in such transactions or that such transactions, once commenced, will not be discontinued without notice. 
+
+Underwriters, dealers and agents may engage in transactions with us or perform services for us in the ordinary course of business. 
+
+Shares may not be sold in some states unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with. 
+
+How to Invest:
+
+Subscriptions for purchase of shares offered by this prospectus can be made by completing, signing and delivering to us, the following: 
+
+1) an executed copy of the Subscription Agreement, available from the company; and
+
+2) a check payable to the order of Diamond Technology Enterprises, Inc. in the amount of $1.00 for each 
+
+share you want to 
+
+Page 32
+
+purchase. 
+
+OTC Electronic Bulletin Board Considerations 
+
+We intend to apply to have our stock traded on the OTC Electronic Bulletin Board. The company s shares may never be quoted on the OTC Bulletin Board or listed on an exchange. The OTC Electronic Bulletin Board is separate and distinct from the NASDAQ stock market and other stock exchanges. NASDAQ has no business relationship with issuers of securities quoted on the OTC Electronic Bulletin Board. The SEC s order handling rules, which apply to NASDAQ-listed securities, do not apply to securities quoted on the OTC Electronic Bulletin Board.
+
+Although the NASDAQ stock market has rigorous listing standards to ensure the high quality of its issuers, and can delist issuers for not meeting those standards, the OTC Electronic Bulletin Board has no listing standards. Rather, it is the market maker who chooses to quote a security on the system, files the application, and is obligated to comply with keeping information about the issuer in its files. FINRA cannot deny an application by a market maker to quote the stock of a company. The only requirement for inclusion in the OTC Electronic Bulletin Board is that the issuer be current in its reporting requirements with the SEC. 
+
+Investors must contact a broker-dealer to trade OTC Electronic Bulletin Board securities. Investors do not 
+
+have direct access to the bulletin board service. For bulletin board securities, there only has to be one market maker. Bulletin board transactions are conducted almost entirely manually. Because there are no automated systems for negotiating trades on the bulletin board, they are conducted via telephone. In times of heavy market volume, the limitations of this process may result in a significant increase in the time it takes to execute investor orders. Therefore, when investors place market orders an order to buy or sell a specific number of shares at the current market price it is possible for the price of a stock to go up or down significantly during the lapse of time between placing a market order and getting execution. 
+
+Because bulletin board stocks are usually not followed by analysts, there may be lower trading volume than for NASDAQ-listed securities. 
+
+DISCLOSURE OF COMMISSION POSITION ON
+
+INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
+
+Section 141 of the Delaware General Corporation Law provides that directors and officers of Delaware corporations may, under certain circumstances, be indemnified against expenses (including attorneys fees) and other liabilities actually and reasonably incurred by them as a result of any suit brought against them in their capacity as a director or officer, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, if they had no reasonable cause to believe their conduct was unlawful. It also provides that directors and officers may also be indemnified against expenses (including attorneys fees) incurred by them in connection with a derivative suit if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification may be made without court approval if such person was adjudged liable to the corporation. 
+
+Article 6, Section 6.1 of our bylaws contains provisions which require that our company indemnify its officers, directors, employees and agents, in substantially the same language as Section 141 of the Delaware statutes. 
+
+Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to the directors, officers, and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. 
+
+In the event that a claim for indemnification against such liabilities (other than the payment by the small business issuer of expenses incurred or paid by a directors, officers or controlling person of the small business issuer in the successful defense of any action, suit or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of counsel the matter has 
+
+been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such 
+
+indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final 
+
+adjudication of such issue. 
+
+LEGAL OPINION
+
+Page 33
+
+The validity of the shares offered hereby has been passed upon for us by Kimberly L. Rudge, Esq. 
+
+EXPERTS
+
+The financial statements included in this prospectus for the period from inception (January 14, 2013) through July 31, 2013 have been audited by RBSM LLP, an independent registered public accounting firm, to the extent and for the periods set forth in their report appearing elsewhere herein and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting. 
+
+INTERESTS OF NAMED EXPERTS AND COUNSEL
+
+Kimberly L. Rudge owns 2,000,000 of the Company s restricted common stock. No experts or other counsel to the company have any shares or other interests in the Company. 
+
+LEGAL PROCEEDINGS
+
+The issuer is not party to any pending material legal proceedings.
+
+ADDITIONAL INFORMATION
+
+We will be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, and in accordance therewith file reports, including annual and quarterly reports, proxy statements and other information with the SEC. Such reports, proxy statements and other information may be inspected and copied at prescribed rates at the public reference facilities maintained by the SEC at the SEC s Public Reference Room, 100 F Street, NE, Washington, D.C. 20549 on official business days during the hours of 10:00 a.m. to 3:00 p.m. Please call the SEC at 1-800-SEC-0330 for more information about the operation of the Public Reference Room. Our SEC filings are also available to the public at the SEC s website at http://www.sec.gov.
+
+You may obtain a copy of any of our filings, at no cost, by writing or telephoning us at:
+
+Eduand Musheyev 
+
+37 West 47th Street, Suite 1301
+
+New York, NY 10036 
+
+(212)-382-2104
+
+Page 34
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+INDEX TO FINANCIAL STATEMENTS
+
+ 
+
+Report of Independent Registered Public Accounting Firm
+
+ 
+
+32
+
+ 
+
+ 
+
+ 
+
+Balance Sheet as of July 31, 2013
+
+ 
+
+33
+
+ 
+
+ 
+
+ 
+
+Statement of Operations for the period from January 14, 2013 (date of inception) through July 31, 2013 
+
+ 
+
+34
+
+ 
+
+ 
+
+ 
+
+Statement of Stockholders Equity for the period from January 14, 2013 (date of inception) through July 31, 2013
+
+ 
+
+35
+
+ 
+
+ 
+
+ 
+
+Statement of Cash Flows for the period from January 14, 2013 (date of inception) through July 31, 2013
+
+ 
+
+36
+
+ 
+
+ 
+
+ 
+
+Notes to Financial Statements
+
+ 
+
+37-43
+
+Page 35
+
+REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
+
+To the Board of Directors and Shareholders of 
+
+Diamond Technology Enterprises, Inc.
+
+We have audited the accompanying balance sheet of Diamond Technology Enterprises, Inc. (the Company ), a development stage company as of July 31, 2013 and the related statements of operations, equity and cash flows for the period from January 14, 2013 (date of inception) through July 31, 2013. These financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on these financial statements based on our audit.
+
+We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
+
+In our opinion, the financial statements referred to the above present fairly, in all material respects, the financial position of Diamond Technology Enterprises, Inc. as of July 31, 2013, and the results of operations, equity and cash flows for the period from January 14, 2013 (date of inception) through July 31, 2013 in conformity with accounting principles generally accepted in the United States of America.
+
+The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 3 to the accompanying financial statements, the Company is a development stage company and has not commenced its planned principal operations, is incapable of generating sufficient cash flow to sustain its operations without securing additional financing, which raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to this matter are described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
+
+ 
+
+/s/RBSM LLP
+
+New York, New York
+
+November 5, 2013
+
+Page 36
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+BALANCE SHEET
+
+JULY 31, 2013
+
+ 
+ 
+
+ASSETS
+
+ 
+
+Current assets:
+
+ 
+
+Cash 
+
+ $ 10,586 
+
+ Total current assets
+
+ 10,586 
+
+ 
+ 
+
+Property and equipment, net
+
+ 1,449,335 
+
+ 
+ 
+
+Total assets
+
+ $ 1,459,921 
+
+ 
+ 
+
+ LIABILITIES AND STOCKHOLDERS' EQUITY
+
+ 
+
+Current liabilities:
+
+ 
+
+Accounts payable and accrued expenses
+
+ $ 3,600 
+
+ Total current liabilities
+
+ 3,600 
+
+ 
+ 
+
+Commitments and contingencies
+
+ - 
+
+ 
+ 
+
+Stockholders' equity:
+
+ 
+
+Preferred stock, $0.0001 par value; 10,000,000 shares authorized
+
+ 
+
+Series A Convertible Preferred stock, 1,000,000 designated, -0- shares issued and outstanding
+
+ - 
+
+Series A Convertible Preferred stock to be issued
+
+ 100 
+
+Common stock, $0.0001 par value; 240,000,000 shares authorized, -0- shares issued and outstanding
+
+ - 
+
+Common stock to be issued
+
+ 768,050 
+
+Common stock subscription
+
+ 800 
+
+Additional paid in capital
+
+ 745,559 
+
+Deficit accumulated during development stage
+
+ (58,188)
+
+ Total stockholders' equity
+
+ 1,456,321 
+
+ 
+ 
+
+Total liabilities and stockholders' equity
+
+ $ 1,459,921 
+
+ 
+ 
+
+The accompanying notes are an integral part of these financial statements
+
+Page 37
+
+ 
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+STATEMENT OF OPERATIONS
+
+For the Period from January 14, 2013 (date of inception) through July 31, 2013
+
+ 
+ 
+
+OPERATING EXPENSES:
+
+ 
+
+Selling, general and administrative expenses
+
+ $ 58,188 
+
+ Total operating expenses
+
+ (58,188)
+
+ 
+ 
+
+Loss from Operations before income taxes
+
+ (58,188)
+
+ 
+ 
+
+Income taxes (benefit)
+
+ - 
+
+ 
+ 
+
+Net loss
+
+ $ (58,188)
+
+ 
+ 
+
+The accompanying notes are an integral part of these financial statements
+
+Page 38
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+STATEMENT OF STOCKHOLDERS' EQUITY
+
+For the Period from January 14, 2013 (date of inception) through July 31, 2013
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Deficit
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Accumulated
+
+ 
+
+ 
+Series A Convertible Preferred stock
+
+Common stock
+
+Common 
+
+Additional
+
+During
+
+ 
+
+ 
+To be issued
+
+To be issued
+
+Stock
+
+Paid in
+
+Development
+
+ 
+
+ 
+Shares
+
+Amount
+
+Shares
+
+Amount
+
+Subscription
+
+Capital
+
+Stage
+
+Total
+
+Shares to be issued to founders in January 2013 at par value
+
+ 1,000,000 
+
+ $ 100 
+
+ 60,500,000 
+
+ $ 6,050 
+
+ $ - 
+
+ $ - 
+
+ $ - 
+
+ $ 6,150 
+
+Common shares to be issued for legal fees in January 2013 at $0.001 per share
+
+ - 
+
+ - 
+
+ 2,000,000 
+
+ 2,000 
+
+ - 
+
+ - 
+
+ - 
+
+ 2,000 
+
+Common shares to be issued to acquire equipment in July 2013 at $1 per share
+
+ - 
+
+ - 
+
+ 760,000 
+
+ 760,000 
+
+ - 
+
+ - 
+
+ - 
+
+ 760,000 
+
+Common stock subscription
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 800 
+
+ - 
+
+ - 
+
+ 800 
+
+Contributed capital
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 745,559 
+
+ - 
+
+ 745,559 
+
+Net loss
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ (58,188)
+
+ (58,188)
+
+ Balance, July 31, 2013
+
+ 1,000,000 
+
+ $ 100 
+
+ 63,260,000 
+
+ $ 768,050 
+
+ $ 800 
+
+ $ 745,559 
+
+ $ (58,188)
+
+ $ 1,456,321 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+The accompanying notes are an integral part of these financial statements
+
+Page 39
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+STATEMENT OF CASH FLOWS
+
+For the Period from January 14, 2013 (date of inception) through July 31, 2013
+
+ 
+ 
+
+CASH FLOWS FROM OPERATING ACTIVITIES:
+
+ 
+
+Net loss
+
+ $ (58,188)
+
+Adjustments to reconcile net loss to net cash used in operating activities:
+
+ 
+
+Preferred and common stock to be issued to founders
+
+ 6,150 
+
+Common stock to be issued for services
+
+ 2,000 
+
+Operating expenses incurred by related party on behalf of the Company
+
+30,749
+
+Changes in operating assets and liabilities:
+
+ 
+
+Accounts payable and accrued expenses
+
+ 3,600 
+
+ Net cash used in operating activities
+
+ (15,689)
+
+ 
+ 
+
+CASH FLOWS FROM INVESTING ACTIVITIES:
+
+ 
+
+Purchase of property and equipment
+
+ (500)
+
+ Net cash used in investing activities
+
+ (500)
+
+ 
+ 
+
+CASH FLOWS FROM FINANCING ACTIVITIES:
+
+ 
+
+Proceeds from sale of common stock
+
+ 800 
+
+Contribution from founder
+
+ 25,975 
+
+ Net cash provided by financing activities
+
+ 26,775 
+
+ 
+ 
+
+Net increase in cash
+
+ 10,586 
+
+Cash, beginning of period
+
+ - 
+
+ 
+ 
+
+Cash, end of period
+
+ $ 10,586 
+
+ 
+ 
+
+SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
+
+ 
+
+ 
+ 
+
+Interest paid
+
+ $ - 
+
+Income taxes paid
+
+ $ - 
+
+ 
+ 
+
+Non cash investing and financing activities:
+
+ 
+
+Common stock to be issued to acquire property and equipment
+
+ $ 760,000 
+
+Equipment contributed by founders
+
+ $ 688,833 
+
+ 
+ 
+
+The accompanying notes are an integral part of these financial statements
+
+Page 40
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+NOTES TO FINANCIAL STATEMENTS
+
+JULY 31, 2013
+
+NOTE 1 BUSINESS 
+
+Diamond Technology Enterprises, Inc. (the Company ), was incorporated on January 14, 2013 under the laws of the State of Delaware. The Company is headquartered in New York and was organized for the purpose of producing higher quality diamonds via the use of proprietary high pressure high temperature (HPHT) heat pressure processes.
+
+NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
+
+ 
+
+Basis of presentation:
+
+ 
+
+As the Company is devoting substantially all of its efforts to establishing a new business, and planned principal operations have not yet commenced. There has been no revenue generated from sales, license fees or royalties, the Company is considered a development stage enterprise. Accordingly, the Company's financial statements are presented in accordance with authoritative accounting guidance related to a development stage enterprise. Financial position, results of operations and cash flows of a development stage enterprise are presented in conformity with generally accepted accounting principles that apply to established operating enterprises.
+
+ 
+
+As a development stage enterprise, the Company's primary efforts are devoted to establishing operations and developing customer relationships. The Company has experienced net losses and negative cash flows from operations since inception and expects these conditions to continue for the foreseeable future. In addition, the Company will require additional financing to fund future operations. The Company intends to raise additional capital to complete the development and commercialization of its current product through equity or debt financing; however the Company does not have any commitments or definitive or binding arrangements for such funds. There can be no assurance that such funds, if available at all, can be obtained on terms reasonable to the Company. If the Company is unsuccessful in raising additional capital it will need to reduce costs and operations substantially. 
+
+The above factors raise substantial doubt as to the Company's ability to continue as a going concern. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that may result from the outcome of this uncertainty.
+
+Cash and Cash Equivalents
+
+ The Company considers financial instruments with an original maturity date of three months or less to be cash equivalents.
+
+Use of estimates
+
+ 
+
+The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the useful life of fixed assets and assumptions used in the fair value of stock-based compensation.
+
+Research and Development costs
+
+ 
+
+Page 41
+
+The Company accounts for research and development costs in accordance with the Accounting Standards Codification subtopic 730-10, Research and Development ( ASC 730-10 ). Under ASC 730-10, all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and development costs are expensed when the contracted work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. The Company did not incur research and development expenses for the period from January 14, 2013 (date of inception) through July 31, 2013.
+
+Property, plant and equipment
+
+Property, plant and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets. Gains and losses from the retirement or disposition of property and equipment are included in operations in the period incurred. Maintenance and repairs are expensed as incurred.
+
+Income taxes
+
+ 
+
+Deferred income tax assets and liabilities are determined based on the estimated future tax effects of net operating loss and credit carry-forwards and temporary differences between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted tax rates. The Company records an estimated valuation allowance on its deferred income tax assets if it is not more likely than not that these deferred income tax assets will be realized.
+
+ 
+
+The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. As of July 31, 2013, the Company has not recorded any unrecognized tax benefits.
+
+Stock Based Compensation
+
+ All stock-based payments to employees and to nonemployee directors for their services as directors, including any grants of restricted stock and stock options, are measured at fair value on the grant date and recognized in the statements of operations as compensation or other expense over the relevant service period. Stock-based payments to nonemployees are recognized as an expense over the period of performance. Such payments are measured at fair value at the earlier of the date a performance commitment is reached or the date performance is completed. In addition, for awards that vest immediately and are non-forfeitable the measurement date is the date the award is issued. 
+
+Fair Value of Financial Instruments
+
+ Accounting Standards Codification subtopic 825-10, Financial Instruments ( ASC 825-10 ) requires disclosure of the fair value of certain financial instruments. The carrying value of cash and cash equivalents, accounts payable and accrued liabilities, and short-term borrowings, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. All other significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk. 
+
+Page 42
+
+Where practicable the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed.
+
+Revenue Recognition
+
+The Company will recognize revenue in accordance with Accounting Standards Codification subtopic 605-10, Revenue Recognition ( ASC 605-10 ) which requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments will be provided for in the same period the related sales are recorded.
+
+The Company will account for Multiple-Element Arrangements under ASC 605-10 which incorporates Accounting Standards Codification subtopic 605-25, Multiple-Element Arrangements ( ASC 605-25 ). ASC 605-25 addresses accounting for arrangements that may involve the delivery or performance of multiple products, services and/or rights to use assets.
+
+ 
+
+Concentrations of Credit Risk
+
+ Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such amounts may be in excess of the FDIC insurance limit. The Company periodically reviews its trade receivables in determining its allowance for doubtful accounts. The Company does not have accounts receivable and allowance for doubtful accounts at July 31, 2013.
+
+Net Income (loss) Per Common Share
+
+ The Company computes earnings (loss) per share under Accounting Standards Codification subtopic 260-10, Earnings Per Share ( ASC 260-10 ). Net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the year. Diluted net income (loss) per share is computed using the weighted average number of common and common stock equivalent shares outstanding during the period. As of July 31, 2013, the Company has no common stock or common stock equivalent shares outstanding.
+
+Recent Accounting Pronouncements
+
+There are various updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company's financial position, results of operations or cash flows.
+
+NOTE 3 GOING CONCERN MATTERS
+
+The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying financial statements during the period from January 14, 2013 (date of inception) through July 31, 2013, the Company incurred net losses attributable to common stockholders of $58,188 and used $15,689 in cash for operating activities for the period from January 14, 2013 (date of inception) through July 31, 2013. In addition, the Company is in a development stage, has yet commercialized its planned business and has not generated any 
+
+Page 43
+
+revenues since inception. These factors among others raise substantial doubt about the Company s ability to continue as a going concern for a reasonable period of time.
+
+ The Company's existence is dependent upon management's ability to develop profitable operations. Additional capital will be needed to continue developing its products and services and there can be no assurance that the Company's efforts will be successful. There is no assurance that can be given that management's actions will result in profitable operations or the resolution of its liquidity problems. The accompanying financial statements do not include any adjustments that might result should the Company be unable to continue as a going concern.
+
+NOTE 4- PROPERTY AND EQUIPMENT
+
+Property and equipment is comprised of machines manufactured in Russia, that will enhances any brown vs+ diamond to a multicolored diamonds utilizing high pressure and heat applied to alter the natural process of creating a diamond.. Two machines were acquired in two separate transactions. The first machine was contributed to the company at the donor s acquisition cost of $688,833 and credited to equity as contributed capital. The second machine was acquired for 760,000 shares of the Company s common stock and recorded at fair value of $760,000. As of July 31, 2013, no acquired equipment has been placed in service. In May 2013 a second machine was sold to the Company in exchange for 760,000 shares of common stock. The machine was acquired by Nikitin Vadim Vladimirovich ( Nikitin ) from an unrelated third party on May 17, 2012 for approximately 42,000,000 Russian rubles (the equivalent of $1,400,000). The Company and Nikitin entered into an agreement on May 1, 2013 whereby the Company agreed to issue 760,000 shares of its common stock valued at $1.00 per share in exchange for the machine. The number of shares issued and the assigned value of $ 1.00 per share was negotiated by the two parties based in part on the Company s start-up status at the time the agreement was entered into. Mr. Vladimirovich was not an affiliate at the time of this acquisition. 
+
+NOTE 5 ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
+
+As of July 31, 2013 accounts payable and accrued liabilities for the period ending are comprised of accrued professional fees.
+
+NOTE 6 RELATED PARTY TRANSACTIONS
+
+The Company s officers and shareholders have contributed capital to the Company for working capital purposes, paid expenses incurred on behalf the Company and contributed equipment since the Company s inception in January 2013 in aggregate of $745,559. The aggregate contributions are reflected as additional paid in capital in the Company s financial statements. (See Note 4).
+
+NOTE 7- STOCKHOLDERS EQUITY 
+
+There is not a viable market for the Company s common stock to determine its fair value, therefore management is required to estimate the fair value to be utilized in the determining stock based compensation costs. In estimating the fair value, management considers recent sales of its common stock to independent qualified investors and other factors. Considerable management judgment is necessary to estimate the fair value. Accordingly, actual results could vary significantly from management s estimates.
+
+Preferred stock
+
+ 
+
+The Company has authorized 10,000,000 shares of preferred stock, with a par value of $0.0001 per share. As of July 31, 2013, the Company has -0- shares of preferred stock issued and outstanding.
+
+Page 44
+
+In January 2013, the Board of Directors authorized the issuance of up to 1,000,000 shares of Series A Convertible Preferred Stock (the Series A preferred stock ).
+
+The Series A preferred stock is entitled to preference over holders of junior stock upon liquidation in the amount of the stated value plus any accrued and unpaid dividends and other fees or liquidated damages owing thereon. The holders of Series A preferred stock have 100 votes for each share of Series A preferred stock.
+
+ The Series A preferred stock is convertible, at the option of the holder at any time, whereby each share of Series A preferred stock is convertible into a number of paid and non-assessable shares of the Company common stock at a one to one conversion. 
+
+On January 14, 2013, the Company is obligated to issue 1,000,000 shares of Series A preferred stock as founder shares. 
+
+Common stock
+
+ 
+
+The Company has authorized 240,000,000 shares of common stock, with a par value of $0.0001 per share. As of July 31, 2013, the Company has -0- shares of common stock issued and outstanding.
+
+As January 14, 2013, the Company is obligated to issue an aggregate of 60,500,000 shares of its common stock as founder shares at par value.
+
+As January 14, 2013, the Company is obligated to issue 2,000,000 shares of its common stock for legal services valued at $2,000.
+
+As May 1, 2013, the Company is obligated to issue 760,000 shares of its common stock to acquire equipment valued at $760,000. 
+
+During the period ended July 31, 2013, the Company received $800 as common stock subscription for 8,000 shares of common stock to be issued.
+
+NOTE 8 COMMITMENTS AND CONTINGENCIES 
+
+Leases Obligations
+
+As of July 31, 2013, the Company does not lease space for offices or operations.
+
+Consulting Agreements
+
+The Company has consulting agreements with outside contractors to provide marketing and financial advisory services. The Agreements are generally for a term of 12 months from inception and renewable automatically from year to year unless either the Company or Consultant terminates such engagement by written notice.
+
+Share Commitment
+
+The Company is obligated to issue an aggregate of 34,500,000 shares of its common stock to Nikitin Vadim Vladimirovich, a member of the Company s board of directors. 17,250,000 shares will be issued upon the Company obtaining a working capital facility of $1,500,000 and financing to acquire 10 additional processing machines. An additional 17,250,000 will be issued upon the Company acquiring the balance of 40 processing machines.
+
+Litigation
+
+Page 45
+
+From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm Company s business. The company is currently not party to any such legal proceedings that it believes will have, individually or in the aggregate, a material adverse effect on its business, financial condition or operating results.
+
+NOTE 9 INCOME TAXES
+
+The Company utilizes ASC 740 Income Taxes , which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.
+
+For the period from January 14, 2013 (date of inception) through July 31, 2013, the Company had available for U.S federal income tax purposes net operating loss carryovers of approximately $50,000, which expiring through the year of 2033. The net operating loss carryovers may be subject to limitations under Internal Revenue Code due to significant changes in the Company s ownership. The Company has provided a full valuation allowance against the full amount of the net operating loss benefit, since, in the opinion of management, based upon the earnings history of the Company it is more likely than not that the benefits will not be realized. 
+
+The income tax provision (benefit) for the period ended July 31, 2013 consist of the following:
+
+Federal:
+
+ 
+
+ 
+
+ 
+
+Current
+
+ 
+
+$
+
+-
+
+ 
+
+Deferred
+
+ 
+
+ 
+
+17,500
+
+ 
+
+Total 
+
+ 
+
+ 
+
+17,500
+
+ 
+
+State and local:
+
+ 
+
+ 
+
+ 
+
+ 
+
+Current
+
+ 
+
+ 
+
+-
+
+ 
+
+Deferred
+
+ 
+
+ 
+
+2,700
+
+ 
+
+Total 
+
+ 
+
+ 
+
+2,700
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Change in valuation allowance
+
+ 
+
+ 
+
+(20,200 
+
+)
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Income tax provision (benefit)
+
+ 
+
+$
+
+-
+
+ 
+
+The provision for income taxes differ from the amount of income tax determined by applying the applicable U.S statutory rate to losses before income tax expense for the period ended July 31, 2013 as follows:
+
+Page 46
+
+ 
+
+Statutory federal income tax rate
+
+ 
+
+ 
+
+(35.0
+
+%)
+
+Statutory state and local income tax rate (8.25%), net of federal benefit
+
+ 
+
+ 
+
+(5.4
+
+%)
+
+Change in valuation allowance
+
+ 
+
+ 
+
+40.4
+
+% 
+
+Effective tax rate
+
+ 
+
+ 
+
+0.00
+
+% 
+
+ Deferred income taxes result from temporary differences in the recognition of income and expenses for financial reporting purposes and for tax purposes. The tax effect of these temporary differences representing deferred tax asset and liabilities result principally from the following:
+
+ 
+
+Deferred tax assets (liabilities):
+
+ 
+
+ 
+
+ 
+
+ 
+
+Stock based compensation to be issued for services rendered
+
+ 
+
+$
+
+3,300
+
+ 
+
+Net operating loss carry forward
+
+ 
+
+ 
+
+16,900
+
+ 
+
+Less: valuation allowance
+
+ 
+
+ 
+
+(20,200
+
+)
+
+Net deferred tax asset
+
+ 
+
+$
+
+-
+
+ 
+
+ 
+
+The Company has not yet filed its tax returns for the period from January 14, 2013 (date of inception) through July 31, 2013.
+
+The provisions of ASC 740 require companies to recognize in their financial statements the impact of a tax position if that position is more likely than not to be sustained upon audit, based upon the technical merits of the position. ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken on a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure.
+
+Management does not believe that the Company has any material uncertain tax positions requiring recognition or measurement in accordance with the provisions of ASC 740. Accordingly, the adoption of these provisions of ASC 740 did not have a material effect on the Company s consolidated financial statements. The Company s policy is to record interest and penalties on uncertain tax positions, if any, as income tax expense.
+
+All tax years for the Company remain subject to future examinations by the applicable taxing authorities.
+
+NOTE 10 SUBSEQUENT EVENTS
+
+During the months of August and September 2013, the Company received common stock subscriptions an aggregate of $4,600 for 46,000 shares of the Company s common stock.
+
+In September 2013, the Company is obligated to issue 661,000 shares of its common stock for services rendered valued at $66,100. 
+
+Page 47
+
+On August 6, 2013, the Company entered into addendum to services agreement with David Mortman with following clause: One year following the date hereof, as additional consideration for Mortman's performance of the consulting services and executive duties hereunder, the Company shall issue to Mortman or his designee that number of shares of the Company's Common Stock representing an additional 2% or Two Million shares of ownership interest (whichever is greater) in the Company on a fully diluted basis.
+
+Page 48
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+INDEX TO UNAUDITED CONDENSED
+
+ FINANCIAL STATEMENTS
+
+ 
+
+Condensed Balance Sheets as of January 31, 2014 (unaudited) and July 31, 2013
+
+ 
+
+2
+
+ 
+ 
+
+ 
+
+Condensed Statements of Operations for the three and six months ended January 31, 2014, for the period from January 14, 2013 (date of inception) through January 31, 2013 and for the period from January 14, 2013 (date of inception) through January 31, 2014 (unaudited) 
+
+ 
+
+3
+
+ 
+
+ 
+
+ 
+
+Condensed Statement of Stockholders total liab
+ for the period from January 14, 2013 (date of inception) through January 31, 2014 (unaudited)
+
+ 
+
+4
+
+ 
+
+ 
+
+ 
+
+Condensed Statements of Cash Flows for the six months ended January 31, 2014, for the period from January 14, 2013 (date of inception) through January 31, 2013 and for the period from January 14, 2013 (date of inception) through January 31, 2014 (unaudited)
+
+ 
+
+5
+
+ 
+
+ 
+
+ 
+
+Notes to Condensed Financial Statements (unaudited)
+
+ 
+
+6 13
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+CONDENSED BALANCE SHEETS
+
+ 
+January 31,
+
+July 31,
+
+ 
+2014
+
+2013
+
+ 
+(unaudited)
+
+ 
+
+ASSETS
+
+ 
+ 
+
+Current assets:
+
+ 
+ 
+
+Cash 
+
+ $ 24,759 
+
+ $ 10,586 
+
+Prepaid supplies and expenses
+
+ 136,015 
+
+ - 
+
+ Total current assets
+
+ 160,774 
+
+ 10,586 
+
+ 
+ 
+ 
+
+Property and equipment, net
+
+ 1,449,335 
+
+ 1,449,335 
+
+ 
+ 
+ 
+
+Total assets
+
+ $ 1,610,109 
+
+ $ 1,459,921 
+
+ 
+ 
+ 
+
+ LIABILITIES AND STOCKHOLDERS' EQUITY
+
+ 
+ 
+
+Current liabilities:
+
+ 
+ 
+
+Accounts payable and accrued expenses, $674 and $-0- related party
+
+ $ 58,034 
+
+ $ 3,600 
+
+Stock based payable
+
+ 109,589 
+
+ - 
+
+Advances, related party
+
+ 10,226 
+
+ - 
+
+ Total current liabilities
+
+ 177,848 
+
+ 3,600 
+
+ 
+ 
+ 
+
+Long term debt, related party
+
+ 161,765 
+
+ - 
+
+Total liabilities
+
+ 339,613 
+
+ 3,600 
+
+ 
+ 
+ 
+
+Stockholders' equity:
+
+ 
+ 
+
+Preferred stock, $0.0001 par value; 10,000,000 shares authorized
+
+ 
+ 
+
+Series A Convertible Preferred stock, 1,000,000 shares designated, 1,000,000 and -0- shares issued and outstanding as of January 31, 2014 and July 31, 2013, respectively
+
+ 100 
+
+ - 
+
+Series A Convertible Preferred stock to be issued
+
+ - 
+
+ 100 
+
+Common stock, $0.0001 par value; 240,000,000 shares authorized, 67,575,000 and -0- shares issued and outstanding as of January 31, 2014 and July 31, 2013, respectively
+
+ 6,758 
+
+ - 
+
+Common stock to be issued
+
+ - 
+
+ 768,050 
+
+Common stock subscription
+
+ 500 
+
+ 800 
+
+Additional paid in capital
+
+ 1,578,711 
+
+ 745,559 
+
+Deficit accumulated during development stage
+
+ (315,574)
+
+ (58,188)
+
+ Total stockholders' equity
+
+ 1,270,495 
+
+ 1,456,321 
+
+ 
+ 
+ 
+
+Total liabilities and stockholders' equity
+
+ $ 1,610,109 
+
+ $ 1,459,921 
+
+The accompanying notes are an integral part of these unaudited condensed financial statements
+
+2
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+CONDENSED STATEMENTS OF OPERATIONS
+
+(unaudited)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+From January 14, 2013
+
+From January 14, 2013
+
+ 
+Three Months
+
+Six Months
+
+(date of inception) 
+
+(date of inception) 
+
+ 
+Ending
+
+Ending
+
+Through
+
+Through
+
+ 
+January 31, 2014
+
+January 31, 2014
+
+January 31, 2013
+
+January 31, 2014
+
+OPERATING EXPENSES:
+
+ 
+ 
+ 
+ 
+
+Selling, general and administrative expenses
+
+ $ 90,164 
+
+ $ 256,712 
+
+ $ - 
+
+ $ 314,900 
+
+ Total operating expenses
+
+ 90,164 
+
+ 256,712 
+
+ - 
+
+ 314,900 
+
+ 
+ 
+ 
+ 
+ 
+
+Loss from Operations
+
+ (90,164)
+
+ (256,712)
+
+ - 
+
+ (314,900)
+
+ 
+ 
+ 
+ 
+ 
+
+Other expenses:
+
+ 
+ 
+ 
+ 
+
+Interest expense
+
+ (674)
+
+ (674)
+
+ - 
+
+ (674)
+
+ 
+ 
+ 
+ 
+ 
+
+Loss before income taxes
+
+ (90,838)
+
+ (257,386)
+
+ - 
+
+ (315,574)
+
+ 
+ 
+ 
+ 
+ 
+
+Income taxes (benefit)
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 
+ 
+ 
+ 
+ 
+
+Net loss
+
+ $ (90,838)
+
+ $ (257,386)
+
+ $ - 
+
+ $ (315,574)
+
+ 
+ 
+ 
+ 
+ 
+
+Loss per common share, basic and diluted
+
+ $ (0.00)
+
+ $ (0.01)
+
+ $ - 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+Weighted average number of common shares outstanding, basic and diluted
+
+ 57,340,160 
+
+ 28,670,080 
+
+ - 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+The accompanying notes are an integral part of these unaudited condensed financial statements
+
+3
+
+Page 52
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
+
+For the period from January 14, 2013 (date of inception) through January 31, 2014
+
+(unaudited)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Series A Convertible Preferred Stock To be issued
+
+Series A Convertible Preferred Stock
+
+ Common stock To be issued
+
+Common stock
+
+ Common Stock
+
+Additional Paid in
+
+Deficit Accumulated During Development
+
+ 
+
+ 
+Shares
+
+Amount
+
+Shares
+
+Amount
+
+Shares
+
+Amount
+
+Shares
+
+Amount
+
+Subscription
+
+Capital
+
+Stage
+
+Total
+
+Shares to be issued to founders
+
+ 1,000,000 
+
+ $ 100 
+
+ - 
+
+ $ - 
+
+ 60,500,000 
+
+ $ 6,050 
+
+ - 
+
+ $ - 
+
+ $ - 
+
+ $ - 
+
+ $ - 
+
+ $ 6,150 
+
+Common shares to be issued for legal fees
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 2,000,000 
+
+ 2,000 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 2,000 
+
+Common shares to be issued to acquire equipment
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 760,000 
+
+ 760,000 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 760,000 
+
+Common stock subscription
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 800 
+
+ - 
+
+ - 
+
+ 800 
+
+Contributed capital
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 745,559 
+
+ - 
+
+ 745,559 
+
+Net loss
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ (58,188)
+
+ (58,188)
+
+Balance, July 31, 2013
+
+ 1,000,000 
+
+ $ 100 
+
+ - 
+
+ $ - 
+
+ 63,260,000 
+
+ $768,050 
+
+ - 
+
+ $ - 
+
+ $ 800 
+
+ $ 745,559 
+
+ $ (58,188)
+
+ $ 1,456,321 
+
+Common stock subscription
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 5,100 
+
+ - 
+
+ - 
+
+ 5,100 
+
+Shares to be issued to founders
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 3,600,000 
+
+ 360 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 360 
+
+Common stock to be issued for services
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 661,000 
+
+ 66,100 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 66,100 
+
+Common and preferred stock issued in settlement of prior obligations
+
+ (1,000,000)
+
+ (100)
+
+ 1,000,000 
+
+ 100 
+
+(67,521,000)
+
+ (834,510)
+
+67,521,000 
+
+ 6,752 
+
+ - 
+
+ 827,758 
+
+ - 
+
+ - 
+
+Common stock issued in settlement of stock subscriptions
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ 54,000 
+
+ 5 
+
+ (5,400)
+
+ 5,395 
+
+ - 
+
+ - 
+
+Net loss
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ - 
+
+ (257,386)
+
+ (257,386)
+
+Balance, January 31, 2014
+
+ - 
+
+ $ - 
+
+ 1,000,000 
+
+ $ 100 
+
+ - 
+
+ $ - 
+
+ 67,575,000 
+
+ $ 6,757 
+
+ $ 500 
+
+ $1,578,712 
+
+ $ (315,574)
+
+ $ 1,270,495 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+The accompanying notes are an integral part of these unaudited condensed financial statements
+
+4
+
+Page 54
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+CONDENSED STATEMENTS OF CASH FLOWS
+
+(unaudited)
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+From January 14, 2013
+
+From January 14, 2013
+
+ 
+Six Months
+
+(date of inception) 
+
+(date of inception) 
+
+ 
+Ending
+
+Through
+
+Through
+
+ 
+January 31, 2014
+
+January 31, 2013
+
+January 31, 2014
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+CASH FLOWS FROM OPERATING ACTIVITIES:
+
+ 
+ 
+ 
+
+Net loss
+
+ $ (257,386)
+
+ $ - 
+
+ $ (315,574)
+
+Adjustments to reconcile net loss to net cash used in operating activities:
+
+ 
+ 
+ 
+
+Preferred and common stock issued to founders
+
+ 360 
+
+ - 
+
+ 6,510 
+
+Common stock to be issued for services
+
+ 66,100 
+
+ - 
+
+ 68,100 
+
+Operating expenses incurred by related party on behalf of Company
+
+ - 
+
+ - 
+
+ 30,749 
+
+Changes in operating assets and liabilities:
+
+ 
+ 
+ 
+
+Prepaid expenses and supplies
+
+ (60,000)
+
+ - 
+
+ (60,000)
+
+Accounts payable and accrued expenses
+
+ 54,434 
+
+ - 
+
+ 58,034 
+
+Stock based payable
+
+ 109,589 
+
+ - 
+
+ 109,589 
+
+ Net cash used in operating activities
+
+ (86,903)
+
+ - 
+
+ (102,592)
+
+ 
+ 
+ 
+ 
+
+CASH FLOWS FROM INVESTING ACTIVITIES:
+
+ 
+ 
+ 
+
+Purchase of property and equipment
+
+ - 
+
+ - 
+
+ (500)
+
+ Net cash used in investing activities
+
+ - 
+
+ - 
+
+ (500)
+
+ 
+ 
+ 
+ 
+
+CASH FLOWS FROM FINANCING ACTIVITIES:
+
+ 
+ 
+ 
+
+Proceeds from sale of common stock
+
+ 5,100 
+
+ - 
+
+ 5,900 
+
+Proceeds from related party advances
+
+ 10,226 
+
+ - 
+
+ 10,226 
+
+Proceeds from related party notes payable
+
+ 85,750 
+
+ - 
+
+ 85,750 
+
+Contribution by founder
+
+ - 
+
+ - 
+
+ 25,975 
+
+ Net cash provided by financing activities
+
+101,076 
+
+ - 
+
+ 127,851 
+
+ 
+ 
+ 
+ 
+
+Net increase in cash
+
+ 14,173 
+
+ - 
+
+ 24,759 
+
+Cash, beginning of period
+
+ 10,586 
+
+ - 
+
+ - 
+
+ 
+ 
+ 
+ 
+
+Cash, end of period
+
+ $ 24,759 
+
+ $ - 
+
+ $ 24,759 
+
+ 
+ 
+ 
+ 
+
+SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+Interest paid
+
+ $ - 
+
+ $ - 
+
+ $ - 
+
+Income taxes paid
+
+ $ - 
+
+ $ - 
+
+ $ - 
+
+ 
+ 
+ 
+ 
+
+Non cash investing and financing activities:
+
+ 
+ 
+ 
+
+Common stock to be issued to acquire property and equipment
+
+ $ - 
+
+ $ - 
+
+ $ 760,000 
+
+Note payable, related party issued to acquire prepaid supplies and expenses
+
+ $ 76,015 
+
+ $ - 
+
+ $ 76,015 
+
+Equipment contributed by founders
+
+ $ - 
+
+ $ - 
+
+ $ 688,833 
+
+ 
+ 
+ 
+ 
+
+The accompanying notes are an integral part of these unaudited condensed financial statements
+
+5
+
+Page 56
+
+DIAMOND TECHNOLOGY ENTERPRISES, INC.
+
+(a development stage company)
+
+NOTES TO CONDENSED FINANCIAL STATEMENTS
+
+JANUARY 31, 2014
+
+(unaudited)
+
+NOTE 1 SIGNIFICANT ACCOUNTING POLICIES
+
+A summary of the significant accounting policies applied in the presentation of the accompanying unaudited financial statements follows:
+
+ 
+
+General
+
+ 
+
+The following (a) balance sheets as of January 31, 2014 (unaudited) and July 31, 2013, which have been derived from audited financial statements, and (b) the unaudited interim statements of operations, stockholders equity and cash flows of Diamond Technology Enterprises, Inc. (the "Company") have been prepared in accordance with accounting principles generally accepted in the United States ( GAAP ) for interim financial information and the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended January 31, 2014 are not necessarily indicative of results that may be expected for the year ending July 31, 2014. These unaudited financial statements should be read in conjunction with the audited financial statements and notes thereto for the period ended July 31, 2013 included in the Company s Registration Statement Under Securities Act of 1933 on Form S-1, filed with the Securities and Exchange Commission ( SEC ) on November 6, 2013.
+
+Basis of presentation
+
+The Company was incorporated on January 14, 2013 under the laws of the State of Delaware. The Company is headquartered in New York and was organized for the purpose of producing higher quality diamonds via the use of proprietary high pressure high temperature (HPHT) heat pressure processes.
+
+As the Company is devoting substantially all of its efforts to establishing a new business, and planned principal operations have not yet commenced. There has been no revenue generated from sales, license fees or royalties, the Company is considered a development stage enterprise. Accordingly, the Company's financial statements are presented in accordance with authoritative accounting guidance related to a development stage enterprise. Financial position, results of operations and cash flows of a development stage enterprise are presented in conformity with generally accepted accounting principles that apply to established operating enterprises.
+
+ 
+
+As a development stage enterprise, the Company's primary efforts are devoted to establishing operations and developing customer relationships. The Company has experienced net losses and negative cash flows from operations since inception and expects these conditions to continue for the foreseeable future. In addition, the Company will require additional financing to fund future operations. The Company intends to raise additional capital to complete the development and commercialization of its current product through equity or debt financing; however the Company does not have any commitments or definitive or binding arrangements for such funds. There can be no assurance that such funds, if available at all, can be obtained on terms reasonable to the Company. If the Company is unsuccessful in raising additional capital it will need to reduce costs and operations substantially. 
+
+The above factors raise substantial doubt as to the Company's ability to continue as a going concern. The accompanying unaudited condensed financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that may result from the outcome of this uncertainty.
+
+Cash and Cash Equivalents
+
+The Company considers financial instruments with an original maturity date of three months or less to be cash equivalents.
+
+6
+
+Use of estimates
+
+ 
+
+The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent 
+
+Page 57
+
+assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the useful life of fixed assets and assumptions used in the fair value of stock-based compensation.
+
+Research and Development Cost
+
+ 
+
+The Company accounts for research and development cost in accordance with the Accounting Standard Codification subtopic 730-10, Research and Development ( ASC730-10 ).Under ASC 730-10, all research and development costs must be charged to expenses as incurred. Accordingly, internal research and development costs are expensed as incurred. Third party research and development cost are expenses when constructed work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. The Company did not incur research and development expenses for the period from January 13, 2013 through January 31, 2014.
+
+Prepaid supplies and expenses
+
+Prepaid supplies and expenses are comprised of startup and other production materials to be utilized in the production process.
+
+Property, plant and equipment
+
+Property, plant and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets. Gains and losses from the retirement or disposition of property and equipment are included in operations in the period incurred. Maintenance and repairs are expensed as incurred.
+
+Income taxes
+
+ 
+
+Deferred income tax assets and liabilities are determined based on the estimated future tax effects of net operating loss and credit carry-forwards and temporary differences between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted tax rates. The Company records an estimated valuation allowance on its deferred income tax assets if it is not more likely than not that these deferred income tax assets will be realized.
+
+ 
+
+The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. As of January 31, 2014 and July 31, 2013, the Company has not recorded any unrecognized tax benefits.
+
+Stock Based Compensation
+
+All stock-based payments to employees and to nonemployee directors for their services as directors, including any grants of restricted stock and stock options, are measured at fair value on the grant date and recognized in the statements of operations as compensation or other expense over the relevant service period. Stock-based payments to nonemployees are recognized as an expense over the period of performance. Such payments are measured at fair value at the earlier of the date a performance commitment is reached or the date performance is completed. In addition, for awards that vest immediately and are non-forfeitable the measurement date is the date the award is issued. 
+
+7
+
+Net Income (loss) Per Common Share
+
+The Company computes earnings (loss) per share under Accounting Standards Codification subtopic 260-10, Earnings Per Share ( ASC 260-10 ). Net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the year. Diluted net income (loss) per share is computed using the weighted average number of common and common stock equivalent shares outstanding during the period. As of January 31, 2014, the Company has no common stock equivalent shares outstanding.
+
+Recent Accounting Pronouncements
+
+There are various updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company's financial position, results of operations or cash flows.
+
+Page 58
+
+NOTE 2- PROPERTY AND EQUIPMENT
+
+Property and equipment is comprised of machines manufactured in Russia, that will enhance an unclear diamond to higher grade clearer diamond utilizing high pressure and heat applied to alter the natural process of creating a diamond with less imperfections. Two machines were acquired in two separate transactions. The first machine was contributed to the company at the donor s acquisition cost of $688,833 and credited to equity as contributed capital. The second machine was acquired for 760,000 shares of the Company s common stock and recorded at fair value of $760,000. As of January 31, 2014, no acquired equipment has been placed in service.
+
+NOTE 3 ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
+
+As of January 31, 2014 accounts payable and accrued liabilities for the period ending are comprised primarily of accrued professional fees.
+
+NOTE 4 NOTES PAYABLE, RELATED PARTY
+
+From October 25, 2013 through January 31, 2014, the Company issued an aggregate of $161,765 unsecured notes payable to Eduard Musheyev, the Company s Chief Executive Officer for cash advances and purchases on the Company s behalf. The notes bear 4% per annum interest, payable monthly in arrears and are due five years from the date of issuance. The Company accrued and recorded as current period expenses $674 as related party interest for the three and six months ended January 31, 2014. 
+
+NOTE 5 RELATED PARTY TRANSACTIONS
+
+The Company s officers and shareholders have contributed capital to the Company for working capital purposes. As of January 31, 2014 and July 31, 2013, advances from related party was $10,226 and $-0-, respectively. See Note 4-notes payable, related party above and 7-subsequent events below.
+
+NOTE 6- STOCKHOLDERS EQUITY 
+
+During the six months ended January 31, 2014, the Company received $5,100 as common stock subscription for 51,000 shares of common stock to be issued.
+
+In November 2013, the Company issued an aggregate of 64,100,000 shares of its common stock as founder shares.
+
+In November 2013, the Company issued 760,000 shares of its common stock to acquire equipment from a related party.
+
+In November 2013, the Company issued an aggregate of 2,661,000 shares of its common stock for services rendered valued at $68,100. 
+
+In November 2013, the Company issued an aggregate of 54,000 shares of its common stock for subscriptions received.
+
+8
+
+In October 2013, the Company issued an aggregate of 1,000,000 shares of its Series A Convertible preferred stock as founder shares.
+
+NOTE 7 SUBSEQUENT EVENTS
+
+Note payable issuances:
+
+On February 7, 2014
+
+, the Company issued a $15,000 related party note payable to Eduard Musheyev, the Company s Chief Executive Officer, for advances and costs incurred on the behalf of the Company. The note is due on or before five years from the date of issuance, at interest at 4% per annum, payable monthly, in arrears. Late fee is applicable in the amount of 5% of the amount due.
+
+On February 12, 2014, the Company issued a $45,000 unsecured note
+
+ payable Quick Solutions WorldWide, L.P. The note
+
+ bear
+
+s
+
+ 4% per annum interest, payable monthly in arrears with principal due February 11, 2015. 
+
+On February 12, 2014
+
+, the Company issued a $45,000 related party note payable to Eduard Musheyev, the Company s Chief Executive Officer, for advances and costs incurred on the behalf of the Company. The note is due on or before five years from the
+
+Page 59
+
+date of issuance, at interest at 4% per annum, payable monthly, in arrears. Late fee is applicable in the amount of 5% of the amount due.
+
+9
+
+Page 60
+
+Dealer Prospectus Delivery Obligation
+
+Until ___________ , all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
+
+PART II INFORMATION NOT REQUIRED IN PROSPECTUS
+
+Item 13. Other Expenses of Issuance and Distribution
+
+The following table sets forth the expenses expected to be incurred in connection with the issuance and distribution of the securities being registered. 
+
+SEC Registration
+
+$2,529.54
+
+Legal Fees and Expenses*
+
+$20,000
+
+Accounting Fees*
+
+$10,000
+
+Miscellaneous*
+
+$5,000
+
+Total
+
+$37,529.54
+
+* Estimated
+
+The Issuer will pay all fees and expenses associated with this offering with the Selling Shareholders paying none of the expenses.
+
+Item 14. Indemnification of Directors and Officers
+
+Article 6 of our bylaws contains provisions which require that the company indemnify its officers, directors, employees and agents and Article Eighth of the Company s Articles of Incorporation provides for the Company s ability to indemnify it s officers, directors, employees and agents, subject to the limitations provided in Delaware General Corporation Law Section 141 for expenses actually and reasonably incurred. No indemnification shall be made if the proposed party has been adjudged to be liable to the company or where the matter was settled without court approval. Indemnification must be made upon a determination by a majority of the uninterested Board, and if not available, by the shareholders or by a court of competent jurisdiction. 
+
+Item 15.
+
+Recent Sales of Unregistered Securities 
+
+Prior to July 31, 2013, we sold a total of 8,000 common shares for a gross price of $800. The issuances of the shares to the investors were exempt from registration under Sections 4(2) and 4(6) of the Securities Act and Regulation D. The issuer sold all of the outstanding shares in transactions not involving a public offering, to individuals with whom the principals had a prior relationship. No advertising or solicitation was utilized by the issuer. The Company has filed its Form D with the Commission. 
+
+Also listed in the table below, a total of 661,000 common shares were issued for Executive compensation. Kimberly L. Rudge was issued 2,000,000 shares for legal services. Dormor Corp was issued 2,000,000 common shares, Summit Trading Limited was issued 5,000,000 common shares, Southeast Research Partners, LLC was issued 5,000,000 shares, Prosper Capital, Inc was issued 7,000,000 shares and Sierra Trading Corp was issued 7,000,000 shares, for services. Services provided include formation of the company, development of the business and operating model, market research, general day-to-day operations, investor relations, technology development and oversight.
+
+NAME
+
+Common Shares
+
+Issued
+
+Price
+
+ 
+ 
+ 
+
+Jordan Friedberg
+
+661,000
+
+$66,100
+
+Dormor Corp
+
+2,000,000
+
+$200
+
+Southeast Research Partners, LLC 
+
+Summit Trading Limited
+
+Sierra Trading Corp
+
+Prosper Capital
+
+Kimberly L. Rudge
+
+5,000,000
+
+5,000,000
+
+7,000,000
+
+7,000,000
+
+2,000,000
+
+$500
+
+$500
+
+$700
+
+$700
+
+$20,000
+
+ Subtotal
+
+28,661,000
+
+$88,700
+
+Page 61
+
+Item 16.
+
+Exhibits 
+
+Exhibit
+
+Number
+
+Exhibit Description
+
+ 
+ 
+
+3.1
+
+Articles of Incorporation of Diamond Technology Enterprises, Inc. filed Jan. 14, 2013 (previously filed)
+
+3.2
+
+Bylaws (previously filed)
+
+5.1
+
+10.1
+
+10.2
+
+10.3
+
+10.4
+
+10.5
+
+23.2
+
+Opinion of Kimberly L. Rudge, Esq.
+
+Purchase Agreement for Machine dated May 1, 2013 (previously filed)
+
+Contribution Agreement for Machine dated October 30, 2013 (previously filed)
+
+Subscription Agreement 
+
+Promissory Notes Eduard Musheyev (previously filed)
+
+Promissory Note Quick Solutions WorldWide, LP
+
+ (previously filed)
+
+Consent of RBSM, LLP (auditor)
+
+Consent of Kimberly L. Rudge, Esq. (included in Exhibit 5.1 herein)
+
+Item 17. Undertakings 
+
+The undersigned hereby undertakes:
+
+(1)
+
+to file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement to:
+
+(i)
+
+include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
+
+(ii)
+
+reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424 (b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001591248_pacificorp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001591248_pacificorp_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..20f8dfb7222b6307d5f22a58f7aa91ba95658c63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001591248_pacificorp_prospectus_summary.txt
@@ -0,0 +1 @@
+Link to Table of Contents expenses associated with the strategy, inadequate return of capital, and unidentified issues not discovered in the Company s due diligence. These new ventures are inherently risky and may not be successful. They may materially adversely affect our financial condition and operating results. We may be subject to information technology system failures or network disruptions that could damage our reputation, business operations, and financial conditions. We may be subject to information technology system failures and network disruptions. These may be caused by natural disasters, accidents, power disruptions, telecommunications failures, acts of terrorism or war, computer viruses, physical or electronic break-ins, or similar events or disruptions. System redundancy may be ineffective or inadequate, and our disaster recovery planning may not be sufficient for all eventualities. Such failures or disruptions could prevent access to our online operations and services, preclude transactions, compromise Company or customer data, and result in delays or cancellations. System failures and disruptions could also impede the transactions processing, and financial reporting. Risks Relating to Business in the People s Republic of China All of our assets are located in Hong Kong and the People s Republic of China and all of our revenues are derived from our operations in Meizhou, China. Accordingly, our business, financial condition, results of operations and prospects are subject, to a significant extent, to economic, political and legal developments in the People s Republic of China. The economic, political and social conditions, as well as governmental policies, could affect the financial markets in the People s Republic of China and our liquidity and access to capital and our ability to operate our business. The economy in China differs from the economies of most countries in many respects, including the amount of government involvement, level of development, growth rate, control of foreign exchange, and allocation of resources. While the economy in China has experienced significant growth over the past, growth has been uneven, both geographically and among various sectors of the economy. The government has implemented various measures to encourage economic growth and guide the allocation of resources. Moreover, our financial condition and results of operations may be adversely affected by government control over capital investments or changes in tax regulations that are applicable to us. The People s Republic of China legal system embodies uncertainties which could limit the legal protections available to you and us. The Chinese legal system is a civil law system loosely based on written statutes. The overall effect of legislation over the past 10 years has significantly enhanced the protections afforded to various forms of foreign investment in China. However, these laws, regulations and legal requirements change frequently, and their interpretation and enforcement involve uncertainties. For example, we may have to resort to administrative and court proceedings to enforce the legal protection that we enjoy either by law or contract. However, since Chinese authorities and court authorities have significant discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we might enjoy in a more developed legal system. In addition, intellectual property rights and confidentiality protections in China may not be as effective as in the United States or other countries. Accordingly, we cannot predict the effect of future developments in the Chinese legal system. These uncertainties could limit the legal protections available to us, including our ability to enforce our agreements with our suppliers. The Chinese tax authorities may require us to pay additional taxes in connection with our acquisitions of offshore entities that conduct their Chinese operations through their affiliate in the United States. Our operations and transactions are subject to review by the Chinese tax authorities pursuant to relevant Chinese laws and regulations. However, these laws, regulations and legal requirements change frequently, and their interpretation and enforcement involve uncertainties. For example, in the case of some of our future acquisitions of offshore entities that conduct their Chinese operations through their affiliates in the United States, we cannot assure you that the Chinese tax authorities will not require us to pay additional taxes on such acquisitions, in particular where the Chinese tax authorities take the view that the previous taxable income of the Chinese affiliates of the acquired offshore entities needs to be adjusted and additional taxes be paid. In the event that the sellers failed to pay any taxes required under Chinese law in connection with these transactions, the Chinese tax authorities might require us to pay the tax, together with late-payment interest and penalties. Chinese rules on mergers and acquisitions may subject us to sanctions, fines and other penalties and affect our future business growth through acquisition of complementary business. Link to Table of Contents We cannot assure you that the relevant Chinese government agency approval required for any future issuance of our stock will be deemed legal. We may face sanctions by the Chinese regulatory agencies. In such event, this regulatory agency may impose fines and penalties on our operations in China, limit our operating privileges in China, delay or restrict the repatriation of the proceeds from any future sales of our stock into China, or take other actions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects. Complying with the requirements of rules to complete such transactions could be time-consuming, and any required approval processes, including obtaining approval from the appropriate securities agency, may delay or inhibit the completion of such transactions, which could affect our ability to expand our business or maintain our market share. Restrictions on currency exchange may limit our ability to utilize our revenues effectively. All of our revenues and operating expenses are denominated in Chinese Yuan or the more common name of the currency Renminbi (RMB). Since all of our future revenues will be denominated in Chinese Yuan, any existing and future restrictions on currency exchange may limit our ability to utilize revenues we may generate in United States dollars ( USD ) to fund any future business activities outside China, if any, or expenditures denominated in foreign currencies. This could affect our ability to obtain foreign exchange through debt or equity financing, including by means of loans. Fluctuations in exchange rates could result in foreign currency exchange losses. Appreciation or depreciation in the value of the Chinese Yuan relative to the U.S. dollar would affect our financial results reported in U.S. dollar terms without giving effect to any underlying change in our business or results of operations. The Chinese Yuan may appreciate or depreciate significantly in value against the U.S. dollar in the long term, depending on the fluctuation of the basket of currencies against which it is currently valued or it may be permitted to enter into a full float, which may also result in a significant appreciation or depreciation of the Yuan against the U.S. dollar. Fluctuations in the exchange rate will also affect the relative value of any dividend we issue in the future which will be exchanged into U.S. dollars and earnings from and the value of any U.S. dollar-denominated investments we make in the future. Any future outbreak of severe acute respiratory syndrome or avian flu in China, or similar adverse public health developments, may severely disrupt our business and operations. Since December 2002 China and other countries experienced an outbreak of a new and highly contagious form of atypical pneumonia now known as severe acute respiratory syndrome, or SARS. On July 5, 2003, the World Health Organization declared that the SARS outbreak had been contained. Since September 2003, however, a number of isolated new cases of SARS have been reported. This disease, which is spread through poultry populations, is capable in some circumstances of being transmitted to humans and is often fatal. A new outbreak of SARS or an outbreak of avian flu may result in health or other government authorities requiring the closure of our hotel or other businesses, including office buildings, retail stores and other commercial venues. Any recurrence of the SARS outbreak, an outbreak of avian flu or a development of a similar health hazard in China may deter people from congregating in public places, including our hotel. Such occurrences would significantly and severely disrupt our business and operations. Risks Associated with Our Stock If we fail to continue to comply with the listing requirements of the OTCBB, the price of our common stock and our ability to access the capital markets could be negatively impacted. We may or may not apply to have our common stock quoted on the OTCBB. If we choose to do so we will be subject to certain continued quoting standards. We cannot provide any assurance that we will be able to continue to satisfy the requirements of the OTCBB s continued quoting standards. A delisting of our common stock could negatively affect the price and liquidity of our common stock and could impair our ability to raise capital in the future. Our stock price will be extremely volatile. The trading price of our common stock will be subject to wide fluctuations in response to announcements of our business developments or those of our competitors, quarterly variations in operating results, and other events or factors. In addition, stock markets have experienced extreme price volatility in recent years. This volatility has had a substantial effect on the market prices of companies, at times for reasons unrelated to their operating performance. Such broad market fluctuations may adversely affect the price of our stock. We will not have an underwriter for our offering and so we cannot guarantee how much, if any, of the offering will be sold. Link to Table of Contents The common shares offered are being offered by our existing security holders. We have not retained an underwriter to assist in offering the common shares. Our security holders have limited experience in the offer and sale of securities, and as a result, they may be unable to sell any of the common shares. Sales of substantial amounts of our common stock in the public market could depress the market price of our common stock. The sale of a substantial amount of common stock in the public market, or the perception that such sales may occur, could cause the market price of our common stock to decline. The OTC Bulletin Board, or the OTCBB, is a quotation system, not an issuer listing service, market or exchange. Therefore, buying and selling stock on the OTCBB is not as efficient as buying and selling stock through an exchange. As a result, it may be difficult for you to sell your common stock or you may not be able to sell your common stock for an optimum trading price. The OTCBB is a regulated quotation service that displays real-time quotes, last sale prices and volume limitations in over-the-counter securities. Our common stock is not traded on the OTC QX Marketplace, or OTCQX, which is the trading tier on the OTCBB with the most demanding listing standards. Nevertheless, because trades and quotations on the OTCBB involve a manual process, the market information for such securities cannot be guaranteed. In addition, quote information, or even firm quotes, may not be available. The manual execution process may delay order processing and intervening price fluctuations may result in the failure of a limit order to execute or the execution of a market order at a significantly different price. Execution of trades, execution reporting and the delivery of legal trade confirmations may be delayed significantly. Consequently, one may not be able to sell shares of our common stock at the optimum trading prices. When fewer shares of a security are being traded on the OTCBB, volatility of prices may increase and price movement may outpace the ability to deliver accurate quote information. Lower trading volumes in a security may result in a lower likelihood of an individual s orders being executed, and current prices may differ significantly from the price one was quoted by the OTCBB at the time of the order entry. Orders for OTCBB securities may be canceled or edited like orders for other securities. All requests to change or cancel an order must be submitted to, received and processed by the OTCBB. Due to the manual order processing involved in handling OTCBB trades, order processing and reporting may be delayed, and an individual may not be able to cancel or edit his order. Consequently, one may not be able to sell shares of common stock at the optimum trading prices. The dealer s spread (the difference between the bid and ask prices) may be large and may result in substantial losses to the seller of securities on the OTCBB if the common stock or other security must be sold immediately. Further, purchasers of securities may incur an immediate paper loss due to the price spread. Moreover, dealers trading on the OTCBB may not have a bid price for securities bought and sold through the OTCBB. Due to the foregoing, demand for securities that are traded through the OTCBB may be decreased or eliminated. Financial Industry Regulatory Authority, or FINRA, sales practice requirements may also limit a stockholder s ability to buy and sell our common stock. FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must, after conducting a thorough due diligence review of a customer s financial condition, have reasonable grounds for believing that the investment is suitable for that customer. Special rules on recommending speculative low priced securities to non-institutional customers require broker-dealers to make reasonable efforts to obtain information about the customer s financial status, tax status, investment objectives and other relevant financial information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. These FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and may have an adverse effect on the market for our shares. There has been no independent valuation of the stock, which means that the stock may be worth less than the purchase price. This valuation of our stock is highly speculative and arbitrary. There is no relation to the market value, book value, or any other established criteria. We did not obtain an independent appraisal opinion on the valuation of the shares. Investors may never receive cash distributions which could result in an investor receiving little or no return on his or her investment. Distributions are payable at the sole discretion of our board of directors. We do not know the amount of cash that we will generate, if any, once we have more productive operations. Cash distributions are not assured, and we may never be in a position to make distributions. Link to Table of Contents Even if a market develops for our shares, our shares may be thinly traded with wide share price fluctuations, low share prices and minimal liquidity. If a market for our shares develops, the share price may be volatile with wide fluctuations in response to several factors, including: potential investors anticipated feeling regarding our results of operations; increased competition; our ability or inability to generate future revenues; and market perception of the hotel industry. In addition, if our shares are quoted on the OTCBB, our share price may be affected by factors that are unrelated or disproportionate to our operating performance. Our share price might be affected by general economic, political, and market conditions, such as recessions, interest rates, or international currency fluctuations. In addition, even if our stock is approved for quotation by a market maker through the OTCBB, stocks traded over this quotation system are usually thinly traded, highly volatile and not followed by analysts. These factors, which are not under our control, may have a material effect on our share price. We anticipate the need to sell additional authorized shares in the future. This will result in a dilution to our existing shareholders and a corresponding reduction in their percentage ownership in the Company. We may seek additional funds through the sale of our common stock. This will result in a dilution effect to our shareholders whereby their percentage ownership interest in the Company is reduced. The magnitude of this dilution effect will be determined by the number of shares we will have to issue in the future to obtain the funds required. The sale of additional stock to new shareholders will reduce the ownership position of the current shareholders. The price of each share outstanding common share may decrease in the event we sell additional shares. Since our securities are subject to penny stock rules, you may have difficulty reselling your shares. Our shares are penny stocks and are covered by Section 15(d) of the Securities Exchange Act of 1934 which imposes additional sales practice requirements on broker/dealers who sell our securities including the delivery of a standardized disclosure document; disclosure and confirmation of quotation prices; disclosure of compensation the broker/dealer receives; and, furnishing monthly account statements. For sales of our securities, the broker/dealer must make a special suitability determination and receive from its customer a written agreement prior to making a sale. The imposition of the foregoing additional sales practices could adversely affect a shareholder's ability to dispose of his stock. IMPACT OF THE PENNY STOCK RULES ON BUYING OR SELLING OUR COMMON STOCK The SEC has adopted penny stock regulations which apply to securities traded over-the- counter. These regulations generally define penny stock to be any equity security that has a market price of less than $5.00 per share or an equity security of an issuer with net tangible assets of less than $5,000,000 as indicated in audited financial statements, if
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001591565_bally-corp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001591565_bally-corp_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..58c2ed5ed5686f2695a663be5761fb5200cec1e8
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001591565_bally-corp_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF PROSPECTUS You should read the following summary together with the more detailed business information, financial statements and related notes that appear elsewhere in this Prospectus. In this Prospectus, unless the context otherwise denotes, references to "we," "us," "our", Bally , and Company are to Bally, Corp. A Cautionary Note on Forward-Looking Statements This Prospectus contains forward-looking statements, which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as may, should, expects, plans, anticipates, believes, estimates, predicts, potential, or continue or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled Risk Factors, that may cause our industry s actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001591768_km_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001591768_km_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..090c88fc79ce6ae70d1bea21fd505ee6d4c9e8fc
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001591768_km_prospectus_summary.txt
@@ -0,0 +1,153 @@
+PROSPECTUS SUMMARY
+
+ 
+
+The following summary
+highlights material information contained in this prospectus. This summary does not contain all of the information you should consider
+before investing in the securities. Before making an investment decision, you should read the entire prospectus carefully, including
+the risk factors section, the financial statements and the notes to the financial statements. You should also review the other
+available information referred to in the section entitled "Where You Can Find More Information" in this prospectus
+and any amendment or supplement hereto. 
+
+ 
+
+Company Overview
+
+ 
+
+KM Wedding Events Management,
+Inc. (the "Company" or "KM") was incorporated in the State of Delaware on October 24, 2012.
+
+ 
+
+ On February 14, 2013,
+KM entered into a Stock Purchase Agreement with KM Matrimony Pvt Ltd, a company incorporated under the 1956 Companies Act of India
+("KM India"), pursuant to which KM agreed to purchase ten million (10,000,000) shares of KM India s common stock
+at a price of 11 Indian Rupees (approximately $0.21 USD) per share for an aggregate purchase price of up to two million one hundred
+thousand dollars ($2,100,000 USD) dollars. As of February 21, 2014, pursuant to the above agreement, KM has purchased 1,393,127
+shares at 11 Rupees per share ($0.201 USD at the time of the sale) in KM India on April 3, 2013 for $280,000 USD. A true and correct
+copy of the Stock Purchase Agreement was filed as Exhibit 10.5 to our Amended Registration Statement on Form S-1/A as filed with
+the SEC on January 21, 2014 and is incorporated herein by reference. 
+
+ 
+
+ On February 14, 2013,
+KM entered into a Stock Purchase Agreement with the shareholders of KM India, comprised of Mr. Venkatesan Vaidhyanathan, Mrs.
+Meera Nagarajan, Mr. Sridhar Kalyanasundaram, Mr. Vijaya Bhaskar Venkatesan and Mrs. Nithya Vijaya Baskar, pursuant to which KM
+shall purchase Three Million One Hundred and Fifty Thousand (3,150,000) shares of KM India s common stock from Mr. Venkatesan
+Vaidhyanathan, Mrs. Meera Nagarajan, Mr. Sridhar Kalyanasundaram, Mr. Vijaya Bhaskar Venkatesan and Mrs. Nithya Vijaya Baskar
+payable in two tranches as follows: (i) Tranche A: One Million One Hundred and Fifty Thousand (1,150,000) shares of KM
+India s common stock at a purchase price of 11 Indian Rupees ($0.21 USD) per share ("Tranche A"); and, (ii)
+Tranche B: Two Million (2,000,000) shares of KM India s common stock at a purchase price equal to the fair market
+value of KM India s shares at the time of purchase ("Tranche B"). As of February 21, 2014, KM has purchased
+1,120,018 shares in KM India on April 26, 2013 from Tranche A for an aggregate of $229,000 USD from two of the shareholders of
+KM India viz. Mr. Venkatesan Vaidhyanathan (562,455 shares for $115,000 USD) and Mrs. Meera Nagarajan (557,564 shares for $114,000
+USD). The remaining Tranche A shares and the Tranche B shares have to be sold within 3 years from February 14, 2013. A true and
+correct copy of the Stock Purchase Agreement was filed as Exhibit 10.6 to our Amended Registration Statement on Form S-1/A as
+filed with the SEC on January 21, 2014 and is incorporated herein by reference. 
+
+ 
+
+As a result of the Stock
+Purchase Agreements referenced above, KM now carries on the business of KM India as its primary business and KM India is a subsidiary
+of KM. KM currently holds 55.32% of KM India.
+
+ 
+
+KM India has been involved
+in the wedding services industry in South India since 2004. KM is the brand, which is a short form for , ' ': Kalyana Malai 
+meaning , ' ': Wedding Garland in South Indian language. The services offered by KM India include Matrimonial (Matchmaking)
+Services and Wedding Services. Unless otherwise specified, KM and KM India shall hereinafter be collectively referred to as "KM"
+or the "Company".
+
+ 
+
+KM s Matrimonial
+Services include matchmaking and partner identification, through multiple delivery channels viz. print and visual media, website,
+physical centers and events. The Wedding Services of KM covers 15 different services, including food and beverages, guest services,
+decorations, event planning and event management. In order to increase the Wedding Services business, KM intends to lease and/or
+own wedding halls (physical infrastructures where a wedding is conducted, similar to banquet halls of hotels) and provide Wedding
+Services for the weddings conducted in these halls.
+
+ 
+
+KM currently focuses on
+the geographic locations of Tamil Nadu and Andhra Pradesh (two of the Southern States in India). We believe that the Company is
+well positioned to exploit the potential of the Wedding Services market because of its presence in this market since 2004 and respected
+brand name. The Company is also planning to expand its services in the United States during 2014. KM s target customers include
+the Indian high-income group, higher middle-income group, and other affluent individuals both in the U.S. and India. This segment,
+being upwardly mobile and comfort and service focused, is the right target group for the business positioning of KM.
+
+ 
+
+KM India has been servicing
+the Indian Diaspora in the United States through its website since 2004 which was followed up by Community Meets (events focused
+on bringing together individuals who are seeking a life partner and who share similar backgrounds (e.g. profession, socio-economic
+background, religion, etc.) conducted during the fiscal year 2011 in 5 cities (New York City, South Windsor (Connecticut), Boston,
+Houston & San Antonio) which was attended by around 1,200 prospective matrimonial customers. In October 2013, KM India also
+filmed for Sun TV across 6 different US cities (New York, South Windsor Connecticut), New Brunswick, San Jose, Dallas and Houston),
+which was attended by over 5,400 South Indian community members. KM s TV show is a 30 minute matrimonial-related program
+produced by KM and telecast once a week by Sun TV. The TV program introduces profiles of individuals seeking to be matched and
+also incorporates an entertainment based "debate show" which covers various "topics of social impact" which
+are discussed and debated upon by professionals & experts.
+
+ 7
+
+ 
+
+ 
+
+Based on the experience
+gained from the above activities, KM believes that the Indian Diaspora in the United States presents a lucrative market that requires
+Matrimonial and Wedding Services offered by KM but also requires a customized and focused approach for exploiting the same. The
+plan for exploring this business opportunity includes setting up offices in the U.S. (fiscal 2014), providing Wedding Services
+for weddings to be conducted in India by Indians in the U.S. (fiscal 2014), launching a customized website for Matrimonial Services
+in the U.S. market (fiscal 2015) and providing Wedding Services for conducting weddings locally in the United States (fiscal 2016-17).
+
+ 
+
+We are an "emerging
+growth company" within the meaning of the federal securities laws. For as long as we are an emerging growth company, we
+will not be required to comply with the requirements that are applicable to other public companies that are not "emerging
+growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements
+of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic
+reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation
+and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting
+exemptions until we are no longer an emerging growth company. For a description of the qualifications and other requirements applicable
+to emerging growth companies and certain elections that we have made due to our status as an emerging growth company, see "We
+are an "Emerging Growth Company" and we cannot be certain if the reduced disclosure requirements applicable to Emerging
+Growth Companies will make our Common Stock less attractive to Investors" on Page 11 of this prospectus.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 8
+
+ 
+
+ 
+
+SUMMARY OF THIS OFFERING
+
+ 
+
+ The Issuer 
+ KM Wedding Events Management, Inc.
+
+ 
+ 
+
+ Securities being offered
+ Up to 10,000,000 shares of Common Stock, our Common Stock is described in further detail in the section of this prospectus titled "DESCRIPTION OF SECURITIES – Common Stock."
+
+ 
+ 
+
+ Offering Type
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001592263_us-mhj_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001592263_us-mhj_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a37b6bb4fe6ad339b0e02917f9fd7c4c04a5b34d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001592263_us-mhj_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights selected information from this prospectus and may not contain all the information that is important to you. To understand our business and this offering fully, you should read this entire prospectus carefully, including the financial statements and the related notes beginning on page F-1. This prospectus contains forward-looking statements and information relating to US-MHJ Wooden Elegance Creations Int l Inc. See Cautionary Note Regarding Forward Looking Statements on page 8. Our Company The Company was formed on July 12, 2012 in the State of California. The Company is a Shell Company as defined by as defined in Rule 405. As such no shares will be eligible to be sold or transferred under Rule 144 until in excess of 1 year from the filing of the equivalent of Form 10 information by the Company with the SEC. The selling shareholders in this offering are underwriters. Business Strategy We are a start up stage company. The company focuses on wooden creation products specializing in furniture design by integration of contemporary and ancient culture. Our goal is to play an active role to facilitate the Hei Long Jiang industry development to global market standard. Initially we intend to focus on sales of high-end furniture. We think that the high-end products make our company more competitive and we can achieve a higher profit margin. To minimize the effect of price fluctuation from the raw material, we carefully intend to cooperate with upstream suppliers. We expect to sell our high-end furniture products with different packages. The packages include optional after-sales services and we will provide buy-back guarantee for our products to enhance recurring sales. After our high-end products development becomes mature. We will build up our middle to low-end products by cooperation with retail stores and property developers etc. These products should be developed separately with different brand names from the high-end products as a new series. We will also seek to ensure that information posted on profiles is accurate. We intend to develop procedures to make the information given to a prospective purchaser as accurate as possible. The Company has an accumulated deficit of $31,550 since inception and our auditors issued a going concern opinion in its March 31, 2014 audit. Our executive offices are located at 2500 E. Colorado Blvd. Suite 255. Our telephone number is (626) 568-8789. The Company is an emerging growth company under the Jumpstart Our Business Startups Act. The Company shall continue to be deemed an emerging growth company until the earliest of: (A) the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; (B) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title; (C) the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or (D) the date on which such issuer is deemed to be a large accelerated filer , as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto. . As an emerging growth company the company is exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company the company is exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. The Company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. The Company is a Shell Company as defined by as defined in Rule 405. As such no shares will be eligible to be sold or transferred under Rule 144 until in excess of 1 year from the filing of the equivalent of Form 10 information by the Company with the SEC. The Offering This prospectus covers up to 50,100,000 shares to be sold by our selling shareholders who will sell at a fixed price of $0.02 per share until the prices of our common stock are quoted on the OTCPK and thereafter at prevailing market prices or privately negotiated prices. ABOUT THIS OFFERING Securities Being Offered Up 50,100,000 shares of common stock of US-MHJ Wooden Elegance Creations Int l Inc. to be sold by selling shareholders who will sell at a fixed price of $0.02 per share. The selling shareholders in this offering are underwriters. Initial Offering Price Up 50,100,000 shares of common stock of US-MHJ Wooden Elegance Creations Int l Inc. to be sold by selling shareholders at a fixed price of $0.02 per share. Terms of the Offering The selling shareholders will sell at a fixed price of $0.02 per share. Termination of the Offering The offering will conclude when the selling shareholder have sold all of the 50,100,000 shares of common stock offered by them.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001592480_continenta_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001592480_continenta_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001592480_continenta_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001593773_amj_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001593773_amj_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..69faac99bd69ccb0270e3c3eb4462422522f3d9c
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001593773_amj_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 5
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001594219_preston_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001594219_preston_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..0a4e4085000c5dc092ad02dfe7458172109ba66a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001594219_preston_prospectus_summary.txt
@@ -0,0 +1,173 @@
+PROSPECTUS SUMMARY 
+
+3
+
+ 
+
+ 
+
+RISK FACTORS 
+
+4
+
+ 
+
+ 
+
+USE OF PROCEEDS 
+
+9
+
+ 
+
+ 
+
+ DETERMINATION OF OFFERING PRICE
+
+9
+
+ 
+
+ 
+
+MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS 
+
+9
+
+ 
+
+ 
+
+DESCRIPTION OF BUSINESS 
+
+9
+
+ 
+
+ 
+
+DESCRIPTION OF PROPERTY 
+
+12
+
+ 
+
+ 
+
+MANAGEMENT S DISCUSSION AND ANAYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 
+
+19
+
+ 
+
+ 
+
+LEGAL PROCEEDINGS 
+
+21
+
+ 
+
+ 
+
+DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS 
+
+21
+
+ 
+
+ 
+
+EXECUTIVE COMPENSATION 
+
+23
+
+ 
+
+ 
+
+SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+
+24
+
+ 
+
+ 
+
+CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
+
+24
+
+ 
+
+ 
+
+DESCRIPTION OF SECURITIES TO BE REGISTERED
+
+25
+
+ 
+
+ 
+
+SELLING STOCKHOLDERS 
+
+26
+
+ 
+
+ 
+
+PLAN OF DISTRIBUTION 
+
+28
+
+ 
+
+ 
+
+DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES ACT LIABILITIES 
+
+30
+
+ 
+
+ 
+
+LEGAL MATTERS 
+
+32
+
+ 
+
+ 
+
+EXPERTS 
+
+32
+
+ 
+
+ 
+
+CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
+
+32
+
+ 
+
+ 
+
+WHERE YOU CAN FIND MORE INFORMATION 
+
+32
+
+ 
+
+ 
+
+FINANCIAL STATEMENTS 
+
+F-1
+
+2
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001594879_zoe-s_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001594879_zoe-s_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..5999af08e979b87be033d030fc5d1b338ef5dd8c
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001594879_zoe-s_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information appearing elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully. In particular, you should read the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the notes relating to those statements included elsewhere in this prospectus. Some of the statements in this prospectus constitute forward-looking statements. See "Forward-Looking Statements." In this prospectus, unless the context requires otherwise, references to "Zo s Kitchen," "Zo s," the "Company," "we," "our," or "us" refer to Zoe's Kitchen, Inc. and its consolidated subsidiaries. Our Company Born in the Mediterranean. Raised in the South. Bringing Mediterranean Mainstream. Zo s Kitchen is a fast growing, fast-casual restaurant concept serving a distinct menu of fresh, wholesome, Mediterranean-inspired dishes delivered with Southern hospitality. Founded in 1995 by Zo and Marcus Cassimus in Birmingham, Alabama, Zo s Kitchen is a natural extension of Zo Cassimus' lifetime passion for cooking Mediterranean meals for family and friends. Since opening our first restaurant, we have never wavered from our commitment to make our food fresh daily and to serve our customers in a warm and welcoming environment. We believe our brand delivers on our customers' desire for freshly-prepared food and convenient, unique and high-quality experiences. As a result, we have delivered strong growth in restaurant count, comparable restaurant sales, AUVs, revenues and Adjusted EBITDA. We have grown from 21 restaurants across seven states, including five franchised locations, as of December 29, 2008 to 131 restaurants across 15 states, including three franchised locations, as of November 12, 2014, representing a compound annual growth rate ("CAGR") of 36.6%. Our Company-owned restaurants have generated 18 consecutive fiscal quarters of positive comparable restaurant sales growth, due primarily to increases in customer traffic, which we believe demonstrates our growing brand equity. We have grown our Company-owned restaurant AUVs from approximately $1.1 million in 2009 to approximately $1.5 million in 2013, representing an increase of 32.9% over that time period. For the twenty-eight weeks ended July 14, 2014, our total revenue increased to $88.2 million from $58.6 million for the twenty-eight weeks ended July 15, 2013. For the twenty-eight weeks ended July 14, 2014, Adjusted EBTIDA increased to $8.6 million from $6.0 million for the twenty-eight weeks ended July 15, 2013. From 2009 to 2013, our total revenue increased from $20.8 million to $116.4 million and Adjusted EBITDA increased from $0.9 million to $10.9 million. We generated a loss of $8.9 million and $1.0 million for the twenty-eight weeks ended July 14, 2014 and July 15, 2013, respectively. We generated a net loss of $2.8 million and $3.7 million in 2009 and 2013, respectively. For a reconciliation of Adjusted EBITDA, a non-GAAP term, to net income, see "Summary Historical Consolidated Financial and Other Data." Our growth in comparable restaurant sales since 2009 has allowed us to invest significant amounts of capital to drive growth through the opening of new restaurants and the hiring of personnel required to support our growth plans. Total Restaurants at End of Fiscal Year / Quarter Comparable Restaurant Sales Growth Average Unit Volumes (Dollars in thousands) Our Concept Delivering Goodness in the Communities We Serve. The word "zo ," which means "life" in Greek, is embraced in every aspect of the Zo s Kitchen culture and is a key component of our concept. Our mission is to "deliver goodness to our customers, from the inside out" by: (i) offering a differentiated menu of simple, tasty and fresh Mediterranean cuisine complemented with several Southern staples; (ii) extending genuine Southern If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large Accelerated o Accelerated filer o Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company o CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered (1) Proposed Maximum Aggregate Offering Price Per Share (2) Proposed Maximum Aggregate Offering Price (2) Amount of Registration Fee (3) Common Stock, par value $0.01 per share 4,370,000 $32.90 $143,773,000 $16,707 (1) Includes shares that may be purchased by the underwriters to cover the underwriters' option to purchase additional shares of our common stock from the selling stockholders at the public offering price less the underwriters' discount. See "Underwriting." (2) Estimated solely for the purpose of calculating the registration fee based on the average of the high and low prices for the registrant's common stock on November 11, 2014 pursuant to Rule 457(c) under the Securities Act of 1933, as amended. (3) The registration fee was previously paid. The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents hospitality with personality, including food delivered to your table; (iii) providing an inviting, cosmopolitan, casual-chic environment in our restaurants; and (iv) delivering an outstanding catering experience for business and social events. Our menu offers meals made generally from scratch using produce, proteins and other ingredients that are predominantly preservative- and additive-free, including our appetizers, soups, salads, and kabobs. We believe our team members are a reflection of our customers educated, active and passionate and embrace our culture of providing engaging, attentive service, which we believe helps drive brand advocacy. We believe we deliver a compelling value proposition by offering flavorful food that our customers feel good about eating and providing friendly customer service in an inviting atmosphere, all for an average per-customer spend of $9.57 in 2013. Our food, including both hot and cold items, is well suited for catering to a variety of business and social occasions, and we believe our strong catering offering is a significant competitive differentiator that generates consumer trial of our menu and provides additional opportunities for existing customers to enjoy our food off-premise. For 2013, catering represented approximately 17% of our revenue. We believe we provide an emotional connection to our target customer educated, affluent women and their families who represent approximately 70% of our customer visits, based on internal estimates and third-party data. We promote our brand as an extension of our customers' own kitchens by offering meals inspired by family recipes which reminds them of food they may have prepared at home, while allowing them to spend extra time with family and friends to fuel a balanced and active lifestyle. We believe our menu is appealing during both lunch and dinner, resulting in a balanced day-part mix of approximately 60% lunch and 40% dinner (excluding catering) for 2013. Our Industry We operate in the fast-casual segment of the restaurant industry, which is one of the industry's fastest growing segments. According to Technomic, the fast-casual segment generated $34.5 billion in sales in 2013 and is projected to grow at a CAGR of approximately 10% over the next five years. The largest 84 fast-casual restaurant concepts grew sales by 11.0% in 2013 to $27.1 billion, compared to growth of 3.4% for the 500 overall largest restaurant chains in the United States. We are the largest U.S.-based fast-casual restaurant concept (by number of restaurants) featuring Mediterranean cuisine. Our differentiated menu offering flavorful Mediterranean food delivered to your table at an average per-customer spend of $9.57 in 2013, positions us to compete successfully against other fast-casual concepts as well as against casual dining restaurants, providing us with a large target market. Our Strengths Love Life, Live Zo s! We believe the following strengths differentiate us and serve as the foundation for our continued growth. Our Food Simple. Tasty. Fresh! We believe the Zo s Kitchen experience is driven by providing simple, tasty and fresh Mediterranean food at a compelling value to our customers. High-quality ingredients serve as the foundation of Zo s Kitchen. We prepare our food by utilizing traditional Mediterranean preparation methods such as grilling and baking. Our menu is a reflection of traditional Mediterranean cuisine, offering an abundance of fresh fruits, vegetables and herbs, grains, olive oil and lean proteins. We believe the variety on our menu allows people with different preferences to enjoy a meal together. Simple. Our food is simply prepared and made to order in our scratch kitchens. Our cooking philosophy is rooted in rich traditions that celebrate food, rather than in fads or trends. From our hummus, made fresh daily and served with warm pita bread, to our flavorful salads and kabobs, we serve real food. By real food, we mean food made from simple ingredients, such as raw vegetables, fruits and legumes. We serve food the way it was prepared 100 years ago raw, grilled or baked. Our goodness is created through the careful selection of quality, wholesome ingredients, time-honored preparations inspired by Mediterranean culinary traditions, family recipes that have been passed down for generations and delivering balanced meals. Tasty. True to our heritage, the flavors in our menu are born in the Mediterranean and raised in the South. Inspired by family recipes and Zo Cassimus' simple, fresh-from-the-garden sensibility, our menu features Mediterranean cuisine complemented with several Southern staples. We offer our customers wholesome, flavorful items such as our Mediterranean Tuna sandwich, as well as entr es such as chicken, steak and salmon kabobs and chicken and spinach roll-ups (tortillas stuffed with feta cheese, grilled chicken, sundried tomatoes and spinach), each of which is served with a choice of a side item such as braised rosemary white beans, rice pilaf, pasta salad, roasted vegetables or seasonal fruit. Our culinary team delivers flavorful new menu additions with seasonal ingredients allowing our customers to "Live Mediterranean." One example is our new Mediterranean Quinoa Salad where quinoa is combined with broccoli, tomatoes, onions and feta cheese to deliver a nutritious entr e packed with flavor. Our commitment to fresh food, combined with our traditional Mediterranean cooking philosophy, results in food options that are full of flavor. Fresh. We seek to provide customers with flavorful menu offerings that align with our customers' lifestyles. Fresh ingredients are delivered to our kitchens, and team members wash, cut and prepare food in our kitchens daily. We utilize The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. The prospectus is not an offer to sell these securities nor a solicitation of an offer to buy these securities in any jurisdiction where the offer and sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED NOVEMBER 12, 2014 3,800,000 SHARES Zoe's Kitchen, Inc. Common Stock The selling stockholders identified in this prospectus are offering 3,800,000 shares of Zoe's Kitchen, Inc. common stock. We will not receive any proceeds from the sale of shares of our common stock by the selling stockholders. Our common stock is listed on the New York Stock Exchange under the symbol "ZOES." On November 11, 2014, the last sale price of the shares of our common stock on the New York Stock Exchange was $33.21 per share. We are an "emerging growth company" as defined under the federal securities laws and, as such, are subject to reduced public company reporting requirements. See "Prospectus Summary Implications of Being an Emerging Growth Company." Investing in our common stock involves a high degree of risk. Please read "Risk Factors" beginning on page 14 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PER SHARE TOTAL Public Offering Price $ $ Underwriting Discounts (1) $ $ Proceeds, before expenses, to the selling stockholders $ $ (1) We refer you to "Underwriting" beginning on page 100 of this prospectus for additional information regarding total underwriters' compensation. Delivery of the shares of our common stock is expected to be made on or about , 2014. The selling stockholders have granted the underwriters an option for a period of 30 days from the date of this prospectus to purchase an additional 570,000 shares of our common stock. We will not receive any proceeds from the sale of shares of our common stock by these selling stockholders if the underwriters exercise their option to purchase additional shares of our common stock. Jefferies William Blair Piper Jaffray Stephens Inc. Baird Stifel Prospectus dated , 2014 Table of Contents grilling as the predominant method of cooking our food, and there are no microwaves or fryers in our restaurants. We cater to a variety of dietary needs by offering vegetarian, vegan, gluten-free and our calorie conscious Simply 500 menu selections. We aim to provide food that makes our customers feel good about themselves and their decision to choose Zo s Kitchen. Differentiated Fast-Casual Lifestyle Brand with a Desirable and Loyal Customer Base. We believe the Zo s Kitchen brand reflects our customers' desire for convenient, unique and enjoyable experiences and their commitment to family, friends and enjoying every moment. We seek to deliver on these desires and to provide goodness to both the mind and the body by fueling our customers' active lifestyle with nutritious food that makes them feel great from the inside out. We believe we are an aspirational brand with broad appeal that our customers embrace as a reflection of their desired self-image active, vibrant, sophisticated, genuine, caring and passionate which results in customer advocacy and repeat visits. Based on third-party surveys, we estimate that approximately 94% of our surveyed customers intend to recommend Zo s Kitchen. We seek to strengthen our brand through grassroots marketing programs and the use of social media and technology aimed at building long-term relationships with our customers and inspiring lifelong brand advocates. We provide a welcoming environment, attracting customers from a variety of demographic groups. We believe our combination of menu offerings, ambience and location is designed to appeal to educated and affluent women, who along with their families, represent approximately 70% of our customer visits. Our female customers generally lead active lifestyles, have an average annual household income of over $100,000 and a majority of them are college educated. We believe this demographic represents a highly-desirable customer base with strong influence on a family's mealtime decision-making and are strong brand advocates. We also believe they appreciate the authenticity of our brand and the quality of our menu offerings, admire that we are still cooking meals inspired by family recipes and feel good about the food they provide to themselves and their families when choosing Zo s Kitchen. Additionally, we believe our attractive demographic mix, high repeat visit rate and our ability to draw an average of approximately 2,500 customers to each of our restaurants per week makes us a desirable tenant to landlords and developers of lifestyle centers seeking to drive traffic to complementary retail businesses. Delivering a Contemporary Mediterranean Experience with Southern Hospitality. We strive to provide an inviting and enjoyable customer experience through the atmosphere of our restaurants and the friendliness of our team members. Our restaurants, highlighted by our distinct Zo s Kitchen stripes drawn from the color palette of many seaside Mediterranean neighborhoods, are designed to be warm, welcoming and full of energy. Each of our restaurants has a unique layout to optimize the available space with consistent design cues that strive to balance the richness of dark wood with contemporary, colorful and cosmopolitan casual-chic d cor. Our patios, a core feature of our restaurants, are an authentic part of both our Southern and Mediterranean heritage and we believe they provide a relaxing and welcoming dining environment. We invite the community to be a part of each restaurant by showcasing local items such as artwork by the children of our customers. Overall, we seek to create an environment that welcomes casual conversations, family moments or quick exchanges as our customers eat and enjoy a break from their busy schedules. True to our Southern heritage, we aim to deliver hospitality and attentive service whether our customers choose to dine-in, take-out or host a catered event. Our team members are a reflection of our customers educated, active and passionate. They are the heart and soul of what we call "Southern hospitality with personality" making sure our customers feel as welcome as they are well fed. Our team members are trained to deliver personalized service and maintain a clean and inviting atmosphere that fosters a pleasant dining experience. We offer modified table service where, after ordering at the counter, our customers' food is served at their table on china with silverware. Our team members routinely check on them throughout the meal and then bus their table, all without the expectation of receiving a tip. We believe the atmosphere of our restaurants and the dedication of our team members encourages repeat visits, inspires advocacy and drives increased sales. Diverse Revenue Mix Provides Multiple Levers for Growth. We believe our differentiated menu of both hot and cold food enables our customers to utilize our restaurant for multiple occasions throughout the day. We had a balanced day-part mix of approximately 60% lunch and 40% dinner (excluding catering), and our catering business represented approximately 17% of revenue, in each case, for 2013. We view catering as our third day-part, which helps to increase AUVs and brand awareness by introducing our concept to new customers through trial. We believe we effectively serve both small and large groups in our restaurants, as well as outside of our restaurants with our catering and home meal replacement alternatives, including our Zo s Fresh Take grab-and-go coolers and our family dinner options. In addition, we also serve beer and wine in a majority of our restaurants. We believe the breadth of our offerings provides us multiple levers to continue to drive growth. Attractive Unit Economic Model with Proven Portability. Our sophisticated, predictive site selection strategy and flexible new restaurant model have resulted in growth in markets of varying sizes as we have expanded our restaurant base utilizing in-line, end-cap and free-standing restaurant formats. We believe our strong performance across a variety of geographic areas and steady AUV growth are validation of our concept's portability. For 2013, our top 20 performing restaurants were spread across seven different states. We have experienced consistent AUV growth across all of our restaurant vintages. Table of Contents Our restaurant model is designed to generate strong cash flow, attractive restaurant-level financial results and high returns on invested capital. We believe our unit economic model provides a return on investment that is attractive to investors and supports further use of cash flow to grow our restaurant base. Our new restaurant investment model targets an average cash build-out cost of approximately $750,000, net of tenant allowances, AUVs of $1.3 million and cash-on-cash returns in excess of 30% by the end of the third full year of operation. On average, new restaurants opened since the beginning of 2009 have exceeded these AUV and cash-on-cash return targets within the third year of operations. Additionally, since the majority of our restaurant base was built in 2009 or after, we believe our restaurants are well maintained and will likely require minimal additional capital expenditures in the near term, allowing a majority of our cash flow to be available for investment in new restaurant development and other growth initiatives. Experienced Management Team. Our strategic vision and results-driven culture are directed by our senior management team under the leadership of Kevin Miles, who guided the growth of our Company from 22 to 131 restaurants. Mr. Miles joined Zo s Kitchen in 2009 as Executive Vice President of Operations. In 2011, he was promoted to President and Chief Operating Officer, and in 2012, he was promoted to Chief Executive Officer. Mr. Miles is a fast-casual industry veteran with over 20 years of relevant experience including leadership roles at La Madeleine French Bakery and Caf , Baja Fresh Mexican Grill and Pollo Campero. He directs a team of dedicated and progressive leaders who are focused on executing our business plan and implementing our growth strategy. We believe our experienced management team is a key driver of our restaurant growth and positions us well for long-term growth. Our Growth Strategies Bringing Mediterranean Mainstream. We plan to execute the following strategies to continue to enhance our brand awareness and grow our revenue and achieve profitability. Grow Our Restaurant Base. We have expanded our restaurant base from 21 restaurants in seven states in 2008 to 131 restaurants in 15 states as of November 12, 2014. We opened 27 Company-owned restaurants in 2013, and we plan to open 30 to 31 Company-owned restaurants in 2014. As of November 12, 2014, we had opened 29 Company-owned restaurants in 2014. We believe we are in the early stages of our growth story and estimate a long-term total restaurant potential in the United States in excess of 1,600 locations. We utilize a sophisticated site selection process using proprietary methods to identify target markets and expansion opportunities within those markets. Based on this analysis, we believe there is substantial development opportunity in both new and existing markets. We expect to double our restaurant base in approximately four years. Increase Comparable Restaurant Sales. We have consistently demonstrated strong comparable restaurant sales growth, and we intend to generate future comparable restaurant sales growth with an emphasis on the following goals: Heighten brand awareness to drive new customer traffic. We utilize a marketing strategy founded on inspiring brand advocacy rather than simply capturing customers through traditional tactics such as limited time offers. Our highly-targeted marketing strategy seeks to generate brand loyalty and promote advocacy by appealing to customers' emotional needs: (i) their passion for wholesome and flavorful food; (ii) their desire for simple solutions to make life more convenient; (iii) their focus on choices as a reflection of self; and (iv) their desire to be a guest at their own party. We have a long history of generating new traffic growth at our restaurants through the application of targeted advertising messages, local restaurant-level marketing and the word-of-mouth of our existing customers to build brand recognition in the markets we serve. We utilize a variety of channels to communicate brand messaging and build relationships with customers. Our digital strategy includes social media, online influencer programming and blogs hosted on our website and microsite. Our social community, including Facebook, Pinterest, Instagram and Twitter, includes more than 174,000 users combined. In addition, customers can opt into our e-mail marketing program or download our custom mobile LIFE app, which consists of 408,000 unique members combined. These programs enable us to segment and target messaging applicable to each of these members. We also use traditional methods to appeal to customers inside our restaurants, including point of purchase displays and cashier incentive programs. We build brand awareness through partnerships with schools and community partners, as well as complementary businesses that target our core customers. We will continue to leverage our catering business, promotional events and a targeted menu sampling strategy as effective means to introduce customers to the Zo s Kitchen brand. We believe the continued implementation of our highly-targeted marketing strategy, combined with the core strengths of our brand, will increase brand awareness, build long-term customer advocacy and drive incremental sales at our restaurants. Increase existing customer frequency. We believe we will be able to continue to increase customer frequency by consistently providing fresh Mediterranean cuisine at a compelling value. We intend to explore new menu additions by drawing upon the rich heritage and flavors of 21 Mediterranean countries and family recipes to enhance our offerings and encourage frequency. We will continue to explore ways to increase the number of occasions (lunch, dinner and Table of Contents catering) and the flexibility of dining options (dine-in, to-go/take home, call-in and online) for our customers to consume our food. We also plan to capitalize on the increasing demand for convenient, high-quality home meal replacement alternatives by expanding the food options in our Zo s Fresh Take grab-and-go coolers and our family dinner menu offerings, which include a salad, entr e and side items offered for approximately $30 for a family of four. Grow our catering business. Our management team has developed innovative solutions, loyalty programs and a dedicated team of sales professionals to enhance our catering offering, which represented approximately 17% of our revenue in 2013. We believe our strong catering offering is a significant competitive differentiator and generates consumer trial of our brand as well as provides our existing customers additional ways to enjoy our food off-premise. We offer catering solutions for both business and social occasions, and we believe our hot and cold menu offerings differentiate our catering business as our food is portable and conducive to travel. We are focused on making catering easier for our customers, which we believe helps to promote brand advocacy by allowing customers to be a guest at their own party. We offer social catering solutions designed for our core customers' life events, including Zo s Party Packs, which are bundled catering packages for birthday parties, baby and bridal showers, sporting and outdoor events, girls night out and family gatherings. Improve Margins and Leverage Infrastructure. We have invested in our business, and we believe our corporate infrastructure can support a restaurant base greater than our existing footprint. As we continue to grow, we expect to drive greater efficiencies in our supply chain and leverage our technology and existing support infrastructure. Additionally, we believe we will be able to optimize labor costs at existing restaurants as our restaurant base matures and AUVs increase and leverage corporate costs over time to enhance margins as general and administrative expenses grow at a slower rate than our restaurant base and revenues.
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this Prospectus and may not contain all of the information you should consider before investing in the shares. You are urged to read this Prospectus in its entirety, including the information under "Risk Factors". Unless the context indicates otherwise, the words "we," "us" "our" or the "Company" refer to 3D Total Solutions, Inc. About Our Company 3D Total Solutions, Inc. was founded in the State of Delaware on March 8, 2013. We are a development stage company that seeks to enhance the value of the 3D printing experience, via various initiatives. We intend to develop each initiative into a revenue source for the company. Our initiatives are described later in the document. In summary, we have two , ' ': hardware-related and three , ' ': software-related products in development. Regarding our , ' ': hardware-related products, we are developing a three-dimensional ("3D") printing machine(s), and/or components of 3D-printers, in which a component allows the 3D-printer to print multiple filaments during the same print. We intend this to be a consumer-grade product. Another product we are developing is a desktop extrusion device. We are in the process of developing a machine for creating filament out of plastic raw material and possibly other materials, in a small and economical package, with higher quality than currently on the market. We intend to outsource the production of our 3D printer and desktop extruder device, if applicable. Our , ' ': software-based products will include 3D gaming applications and competitions (in development), a website with the ability to support an online community of users that can upload and share their designs/prints, and an area of the website where users can purchase parts kits that will allow them to build better, more useful objects than what is currently on the market. We believe that our ability to offer these 3D-printing related products will provide the end user with a unique offering that will enhance the user s printing experience, add value, and in return, accelerate the popularity of the 3D-Printing industry as a whole. We have provisional patents filed on a component of a 3D printer, and intend on having patents filed related to the desktop extruder device, currently in development. We are developing games for people to play using a 3D printer and have filed provisional patents related to the systems, apparatus, and methods for conducting such games. Lastly, we are exploring the application of 3D printing to the field of orthotics. It is our intention that this develops into a division that creates orthotics using 3D printing technology, however, the direction may change as we progress further. Being a development stage company, we have very limited operating history. If we do not generate sufficient revenue we may need a minimum of $100,000 of additional funding to pay for ongoing business activities and SEC filing requirements for the next twelve months. We do not currently have any arrangements for additional financing. From inception until the date of this filing, we have had limited operating activities. Our financial statements from inception (March 13, 2013) through June 30, 2014, reports a net loss of $399,001. Our independent registered public accounting firm has issued an audit opinion for 3D which includes a statement expressing substantial doubt as to our ability to continue as a going concern. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to Be Registered Amount to Be Registered (5) Proposed Offering Price per Share Proposed Aggregate Offering Price Amount of Registration Fee(4) Common Stock 3,513,300(1) $0.25(3) $878,325 $113.13 Common Stock 1,000,000(2) $0.25(3) $250,000 $32.20 (1) Represents 3,513,300 shares of our common stock being registered for resale on behalf of the selling shareholders named in this registration statement. (2) Represents 1,000,000 shares of our common stock being registered for resale on behalf of the Company. (3) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457 under the Securities Act of 1933. Our common stock is not traded on any national exchange and in accordance with Rule 457, the offering price was determined by the average price shares were sold to our shareholders in a private placement. (4) Paid in advance. The Company has agreed to bear the expenses related to the registration of shares for the selling shareholders. Calculated under Section 6(b) of the Securities Act of 1933 as $.00012880 of the aggregate offering price. (5) In accordance with Rule 416(a), this registration statement shall also cover an indeterminate number of shares that may be issued and resold resulting from stock splits, stock dividends or similar transactions. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. We do not anticipate earning significant revenues until we enter into commercial operation. Since we are presently in the development stage of our business, we can provide no assurance that we will successfully assemble, construct and sell any products or services related to our planned activities. Implications of Being an "Emerging Growth Company" As a public reporting company with less than $1.0 billion in revenue during our last fiscal year, we qualify as an "emerging growth company" under the Jumpstart our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of certain reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally applicable to public companies. In particular, as an emerging growth company we: are not required to obtain an attestation and report from our auditors on our management s assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002; are not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyzing how those elements fit with our principles and objectives (commonly referred to as "compensation discussion and analysis); are not required to obtain a non-binding advisory vote from our stockholders on executive compensation or golden parachute arrangements (commonly referred to as the "say-on-pay," "say-on-frequency" and "say-on-golden-parachute" votes); are exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and CEO pay ratio disclosure; may present only two years of audited financial statements and only two years of related Management s Discussion & Analysis of Financial Condition and Results of Operations, or MD are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the JOBS Act; and are exempt from any PCAOB rules relating to mandatory audit firm rotation and any requirement to include an auditor discussion and analysis narrative in our audit report. We intend to take advantage of all of these reduced reporting requirements and exemptions, including the longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the JOBS Act. Our election to use the phase-in periods may make it difficult to compare our financial statements to those of non-emerging growth companies and other emerging growth companies that have opted out of the phase-in periods under 107 of the JOBS Act. Certain of these reduced reporting requirements and exemptions were already available to us due to the fact that we also qualify as a "smaller reporting company" under SEC rules. For instance, smaller reporting companies are not required to obtain an auditor attestation and report regarding management s assessment of internal control over financial reporting; are not required to provide a compensation discussion and analysis; are not required to a pay-for-performance graph or CEO pay ratio disclosure; and may present only two years of audited financial statements and related MD&A disclosure. THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. PRELIMINARY PROSPECTUS (Subject to Completion) DATED ___, 2014 3D TOTAL SOLUTIONS, INC. 4,513,300 SHARES OF COMMON STOCK This is the initial offering of common stock of 3D Total Solutions, Inc. and no public market currently exists for the securities being offered. We are offering for sale a total of 1,000,000 shares of common stock at a fixed price of $0.25 per share, and the selling shareholders are offering a total of 3,513,300 shares of common stock. There is no minimum number of shares that must be sold by us for
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+503a:
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+S-1 1 d837018ds1.htm FORM S-1 Form S-1 Table of Contents As filed with the Securities and Exchange Commission on December 12, 2014 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 QUOTIENT LIMITED (Exact name of registrant as specified in its charter) Jersey, Channel Islands 2835 Not applicable (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) Pentlands Science Park Bush Loan, Penicuik, Midlothian EH26 OPZ, United Kingdom Tel: 011-44-0131-445-6159 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Stephen Unger Quotient Biodiagnostics, Inc. 301 South State Street, Suite S-204 Newtown, Pennsylvania 18940 (215) 497-7006 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Alejandro E. Camacho, Esq. Per B. Chilstrom, Esq. Clifford Chance US LLP 31 West 52nd Street New York, NY 10019 (212) 878-8000 Approximate date of commencement of proposed sale to public: As soon as practicable after this Registration Statement is declared effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to Be Registered Amount to be Registered Proposed Maximum Offering Price per Share(1) Proposed Maximum Aggregate Offering Price(1)(2) Amount of Registration Fee(2) Ordinary shares of no par value ( Ordinary Shares ) 2,000,000 $13.72 $27,440,000 $3,188.53 Ordinary Shares underlying pre-funded warrants ( Warrants ) 850,000(3) $13.72 $11,662,000 $1,355.12 Total 2,850,000(4) $13.72 $39,102,000 $4,543.65 (1) Estimated solely for purposes of calculating the registration fee, pursuant to Rule 457(c) under the Securities Act of 1933, as amended, based on the average of the high and low reported sales prices on the Nasdaq Global Market on December 11, 2014. (2) The registration fee has been calculated in accordance with Rule 457(o) under the Securities Act of 1933, as amended. (3) Represents the maximum number of Ordinary Shares currently issuable upon the exercise of the Warrants with an exercise price of $0.01 per share. (4) Pursuant to Rule 416 under the Securities Act of 1933, as amended, the securities being registered hereunder also include such indeterminate number of Ordinary Shares as may be issuable with respect to the securities being registered hereunder as a result of share splits, share dividends or similar transactions as a result of anti-dilution provisions contained in the Warrants. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents The information in this prospectus is not complete and may be changed. The selling shareholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is declared effective. This preliminary prospectus is not an offer to sell securities and the selling shareholders are not soliciting an offer to buy securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION Preliminary Prospectus Dated December 12, 2014 2,850,000 Ordinary Shares of Quotient Limited This prospectus relates to the offer and resale from time to time of up to 2,850,000 ordinary shares of nil par value per share by the selling shareholders identified in this prospectus or in supplements to this prospectus. See Selling Shareholders. Of these 2,850,000 ordinary shares, 850,000 ordinary shares are issuable upon the exercise of our pre-funded warrants. The holders of the pre-funded warrants must pay an exercise price of $0.01 per share to purchase the ordinary shares underlying the pre-funded warrants (or the warrant shares). The 2,000,000 ordinary shares and pre-funded warrants exercisable for 850,000 warrant shares to which this prospectus relates were issued to the selling shareholders in connection with a private placement. This prospectus does not necessarily mean that the selling shareholders will offer or sell those shares. We cannot predict when or in what amounts the selling shareholders may sell any of the shares offered by this prospectus. The prices at which the selling shareholders may sell the shares will be determined by the prevailing market price for the shares or in negotiated transactions. We are filing the registration statement pursuant to contractual obligations that exist with the selling shareholders. We are not selling any ordinary shares under this prospectus and will not receive any proceeds from the sale or other disposition of shares by the selling shareholders, except that we will receive the proceeds of any exercises of the pre-funded warrants, which, if received, would be used by us for working capital, operating expenses and general corporate purposes. The selling shareholders will bear all commissions and discounts, if any, attributable to the sale or other disposition of the shares. We will bear all costs, expenses and fees in connection with the registration of the shares other than the fees and disbursements of legal counsel to the selling shareholders. See Selling Shareholders and Plan of Distribution. Our ordinary shares are listed on The NASDAQ Global Market under the symbol QTNT. On December 11, 2014, the closing sale price of our ordinary shares on The NASDAQ Global Market was $13.31 per share. The selling shareholders identified in this prospectus from time to time may offer and resell the shares held by them directly or through agents or broker-dealers on terms to be determined at the time of sale. To the extent required, the names of any agent or broker-dealer and applicable commissions or discounts and any other required information with respect to any particular offer will be set forth in a prospectus supplement that will accompany this prospectus. A prospectus supplement also may add, update or change information contained in this prospectus. Each of the selling shareholders reserves the sole right to accept or reject, in whole or in part, any proposed purchase of the shares to be made directly or through agents. We are an emerging growth company under applicable Securities and Exchange Commission rules and, as such, have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. Investing in our securities involves a high degree of risk. Before buying any securities, you should carefully read the discussion of material risks of investing in our securities in Risk Factors beginning on page 5 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No Jersey regulatory consent is required in respect of the offering subject of this prospectus and, consequently, no consent has been sought from the Jersey Financial Services Commission in connection with this prospectus. The date of this prospectus is , 2014 Table of Contents TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001597680_jumei_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001597680_jumei_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001597929_socialplay_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001597929_socialplay_prospectus_summary.txt
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+PROSPECTUS SUMMARY AND RISK FACTORS
+ 
+
+ You should read the following summary together with the entire prospectus, including the more detailed information in our financial statements and related notes appearing elsewhere in this prospectus. You should carefully consider the matters discussed in Risk Factors beginning on page 7.
+ 
+
+ The Company
+ 
+
+ We were incorporated in the State of Nevada on December 31, 2013 as Artesanias Corp. Our primary business objective is to distribute the arts and crafts of the indigenous tribes of Panama via the Internet. All of the products we plan to sell will be hand-made by tribes-people to preserve cultural authenticity. Our target customers are either: (a) collectors of authentic indigenous Panamanian hand made arts and crafts or (b) prior purchasers of Panamanian products looking for unique gifting ideas. 
+ 
+
+ We are attempting to build Artesanias into a fully operational company. We currently have one employee, who is our sole officer and director, who expects to devote approximately 20 hours per week to the development of our business and operations. We are still in the development stage, have not published a website, and have no inventory to sell. In order to do so and begin generating revenues, we must develop and publish our website. We in the process of seeking and engaging a third party firm to develop our web site. We expect to operate solely as an online business, whereby our proposed website will be the sole method through which we will realize sales and all of our marketing activities will be conducted via the Internet. Thus, we believe this site is critical to reaching prospective customers and for generating awareness of our brand. Unfortunately, at this time our website is only in the conceptual development stage. Until we publish a website, we will be unable to generate brand awareness or effect sales.
+ 
+
+ Since our inception, we have not generated any revenues. During the year ended December 31, 2013, we incurred a net loss of $600. We expect to spend approximately $25,000 - $50,000 in the next 12 months of operations to execute our planned principal operations and continue as a going concern. Unfortunately, there can be no assurance that the actual expenses incurred will not materially exceed our estimates or that cash flows from operating activities will be adequate to maintain our business. In consideration of the foregoing risks, our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern in the independent registered public accounting firm s report to the financial statements. 
+ 
+
+ We are considered a "shell company," as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and are subject to additional regulatory requirements as a result, including, but not limited to, the inability of our shareholders to sell our shares in reliance on Rule 144 promulgated pursuant to the Securities Act of 1933, as well as our inability to register our securities on Form S-8 (an abbreviated registration process). Accordingly, investors should consider our shares to be significantly risky and illiquid investments.
+ 
+
+ We are not a blank check company, as that term is defined in Section 7(b)(3) of the Securities Act of 1933, as amended. We plan to sell arts and crafts hand-made by the Indigenous tribes of Panama. Artesanias has no present plans to be acquired or to merge with another company, nor do we, nor any of our shareholders, have plans to enter into a change of control or similar transaction.
+ 
+
+ As of the date of this prospectus, we have 3,000,000 shares of $0.001 par value common stock issued and outstanding. 
+ 
+
+ Our address and telephone number are:
+ 
+
+ Monte Oscuro
+ 16th Street, Rio Abajo
+ Panama, Republic de Panama
+ Telephone (+52) 33 8421-6969
+ 
+
+ Our fiscal year end is December 31.
+ 
+
+ 
+
+ 
+
+ - 4 -
+ 
+
+ 
+
+ The Offering
+ 
+
+ Artesania Corp. is offering, on a best-efforts, self-underwritten basis, a minimum of 1,500,000 and up to 3,000,000 shares of common stock at a price of $0.015 per share. The shares are intended to be sold directly through the efforts of our sole officer and director. The intended methods of communication include, without limitation, telephone and personal contact. 
+ 
+
+ The proceeds from the sale of the shares by the Issuer in this offering will be payable directly to the company. All subscription agreements and checks should be delivered to Artesania Corp. Failure to do so will result in checks being returned to the investor who submitted the check. There is no escrow, trust or similar account in which your subscription will be deposited. All subscription funds will be deposited into a separate bank account, pending the achievement of the minimum offering. The bank account is merely a separate non-interest bearing account under our control where we will segregate your funds. You will not have the right to withdraw your funds during the offering. You will only receive your funds back if we do not raise the minimum amount of the offering within 365 days.
+ 
+
+ The offering shall terminate on the earlier of (i) the date when the sale of a minimum of 1,500,000 shares is completed, (ii) upon the sale of the maximum 3,000,000 shares offered hereby or (iii) 365 days from the date of this prospectus if the minimum offering is not achieved. There are a number of factors to consider with regard to when we will terminate the offering prior to achieving the maximum offering amount. A primary consideration is our sole officer s ability to focus on implementing and operating our proposed business as opposed to selling our stock offering. As such, we may, in our sole discretion, terminate the offering upon achieving only the minimum offering amount to focus on the development of our proposed business. In such event, we believe the net proceeds from a minimum offering would be sufficient to conduct our proposed operations for at least 12 months after the termination of the offering. We will not extend the offering period beyond 365 days from the effective date of the prospectus. If the minimum offering is not achieved within 365 days of the date of this prospectus, all subscription funds will be returned to investors promptly without interest or deduction of fees. We will deliver stock certificates attributable to shares of common stock purchased directly to the purchasers within 30 days after receiving the minimum amount of subscriptions and, thereafter, promptly following each subscription agreement received. (See Plan of Distribution ).
+ 
+
+ The offering price of the common stock has been arbitrarily determined and bears no relationship to any objective criterion of value. The price does not bear any relationship to our assets, book value, historical earnings or net worth.
+ 
+
+ We will apply the net proceeds from the offering to pay for website development, marketing, office supplies and equipment and general working capital.
+ 
+
+ The purchase of the common stock in this offering involves a high degree of risk. The common stock offered in this prospectus is for investment purposes only and currently no market for our common stock exists. Please refer to "Risk Factors" on page 7 and "Dilution" on page 14 before making an investment in our stock.
+ 
+
+ Our Transfer Agent is expected to be Globex Transfer, LLC, 780 Deltona Blvd., Suite 202, Deltona, Florida, Phone: (813) 344-4490.
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ - 5 -
+ 
+
+ 
+
+ Summary Financial Information
+ 
+
+ The summary financial data are derived from the historical financial statements of Artesanias Corp. This summary financial data should be read in conjunction with "Management's Discussion and Plan of Operations" as well as the historical financial statements and the related notes thereto, included elsewhere in this prospectus.
+ 
+
+ Balance Sheet Data
+ 
+
+ 
+ 
+ December 31, 2013
+
+ ASSETS
+ 
+ 
+
+ Current assets
+ 
+ 
+
+ Cash 
+ $
+ -
+
+ Total current assets
+ 
+ -
+
+ 
+ 
+ 
+
+ Total assets
+ $
+ -
+
+ 
+ 
+ 
+
+ LIABILITIES AND STOCKHOLDERS EQUITY
+ 
+ 
+
+ 
+ 
+ 
+
+ Current liabilities:
+ 
+ 
+
+ Accounts payable
+ $
+ 600
+
+ Total current liabilities
+ 
+ 600
+
+ 
+ 
+ 
+
+ Total liabilities
+ 
+ 600
+
+ 
+ 
+ 
+
+ Stockholders equity
+ 
+ 
+
+ Common stock
+ 
+ 3,000
+
+ Additional paid-in capital
+ 
+ 17,000
+
+ Subscriptions receivable
+ 
+ (20,000)
+
+ Deficit accumulated during development stage
+ 
+ (600)
+
+ Total stockholders equity
+ 
+ (600)
+
+ 
+ 
+ 
+
+ Total liabilities and stockholders equity
+ $
+ -
+
+ 
+
+ Statements of Operations Data
+ 
+
+ 
+ 
+ 
+ Inception
+
+ 
+ 
+ (December 31, 2013)
+
+ 
+ 
+ Through 
+
+ 
+ 
+ December 31, 2013
+
+ 
+ 
+ 
+ 
+
+ Revenue
+ 
+ $
+ -
+
+ Total expenses
+ 
+ 
+ 600
+
+ 
+ 
+ 
+ 
+
+ Provision for income taxes
+ 
+ 
+ -
+
+ 
+ 
+ 
+ 
+
+ Net (loss)
+ 
+ $
+ (600)
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ - 6 -
+ 
+
+ 
+
+ Risk Factors
+ 
+
+ Investment in the securities offered hereby involves certain risks and is suitable only for investors of substantial financial means. Prospective investors should carefully consider the following risk factors in addition to the other information contained in this prospectus, before making an investment decision concerning the common stock.
+ 
+
+ Investors may lose their entire investment if we are unable to continue as a going concern.
+ 
+
+ Artesanias Corp. was formed in December 2013. We have not yet begun our planned principal operations and have no operational history on which you can evaluate our business and prospects. We are a small company without guaranteed or recurring streams of revenues. Our prospects must therefore be considered in light of the risks, uncertainties, expenses and difficulties frequently encountered by companies in their early stages of development and without significant operating history. These risks include, without limitation, the absence of guaranteed long-term revenue streams, management that is inexperienced in managing a public company, a competitive market environment with numerous competitors and lack of brand recognition. We cannot guarantee that we will be successful in establishing a profitable business selling hand-made arts and crafts or in accomplishing our objectives. If our business fails, the investors in this offering may face a complete loss of their investment.
+ 
+
+ We may experience liquidity and solvency problems, which could impair our operations or force us out of business.
+ 
+
+ We have no long-term or contractual obligations with clients to provide for guaranteed future revenues. Additionally, future expenditures may be higher than our management may anticipate and budget for, which could materially harm our business. As such, we may experience liquidity and solvency problems. Such liquidity and solvency problems may force us to go out of business if additional financing is not available. We have no intention of liquidating. In the event our cash resources are insufficient to continue operations, we intend to raise additional capital through offerings and sales of equity or debt securities. In the event we are unable to raise sufficient funds, we will be forced to go out of business and will be forced to liquidate. A possibility of such outcome presents a risk of complete loss of investment in our common stock.
+ 
+
+ Our independent accounting firm has expressed substantial doubt about our ability to continue as a going concern.
+ 
+
+ At April 30, 2013, we had not begun to generate revenue, had no certainty of earning revenues in the future, and had no cash on hand. We expect to spend $30,000 in the next 12 months of operations to execute our planned principal operations and continue as a going concern. These factors, among others, raise substantial doubt about our ability to continue as a going concern. Our ability to generate future revenues will depend on a number of factors, many of which are beyond our control. These factors include general economic conditions, market acceptance of our future products and services and competitive efforts. Due to these factors, we cannot anticipate with any degree of certainty what our revenues will be in future periods. As such, our independent registered public accountants have expressed substantial doubt about our ability to continue as a going concern. This opinion could materially limit our ability to raise additional funds by issuing new debt or equity securities or otherwise. You should consider our independent registered public accountant s comments when determining if an investment in the Company is suitable.
+ 
+
+ Our sole officer and director does not experience in public company matters, which could impair our ability to comply with legal and regulatory requirements.
+ 
+
+ Our sole officer and director has no public company management experience or responsibilities. This could impair our ability to comply with legal and regulatory requirements such as the Sarbanes-Oxley Act of 2002 and applicable federal securities laws including filing required reports and other information required on a timely basis. There can be no assurance that our management will be able to implement and affect programs and policies in an effective and timely manner that adequately respond to increased legal, regulatory compliance and reporting requirements imposed by such laws and regulations. Our failure to comply with such laws and regulations could lead to the imposition of fines and penalties and further result in the deterioration of our business.
+ 
+
+ 
+
+ 
+
+ 
+
+ - 7 -
+ 
+
+ Because our sole officer and director has no experience with e-commerce and online sales, we may not generate material sales and we face a high risk of failure.
+ 
+
+ Our sole officer and director has no experience operating an e-commerce business. As such, there can be no assurance that we will be able to implement planned principal operations or generate any sales, and face a high risk of business failure.
+ 
+
+ Our sole officer and director is engaged in a business substantially similar to ours, which could result in conflicts of interest. 
+ 
+
+ Jose Soto, our sole officer and director, produces and sells Panamanian crafts substantially similar in nature to those that Artesanias sells. To the extent Mr. Soto continues to be participate in activities similar to ours or we purchase goods from Mr. Soto, we will face a conflict of interest. Mr. Soto may face a conflict of interest in making any decision related to allocations of corporate opportunities. We have not formulated a policy for the resolution of such conflicts. 
+ 
+
+ The market for hand-made crafts is highly competitive, and we are in an unfavorable competitive position.
+ 
+
+ Our management anticipates competing, in general, with a large number of competitors, comprised of the artisans creating the products we plan to sell. The market for these products is limited in geographic reach, has minimal barriers to entry, highly fragmented and competitive, and experiences wide pricing and availability fluctuations. There can be no assurance that we will be able to compete successfully against present or future competitors or that competitive pressures will not force us to cease our operations. 
+ 
+
+ We may be unable to develop and maintain our website. 
+ 
+
+ We are an internet-based business and we intend to contract developers to create and publish our website. Due to the current demand for skilled website developers and graphic designers, we may not be able to acquire suitable contractors, or they may not be available to us at an acceptable cost. We will need to ensure that the candidates are qualified to develop a user-friendly online site. If we are unable to acquire their services, we will not be able to complete the website and user-friendly interface, which is the most important aspect of our business development. We cannot assure you that the services we seek to create will be successful or that they will be profitable, or if they are profitable, that they will provide an adequate return on capital expended. If we are not successful in developing these new services, we will be unable to commence our planned operations. 
+ 
+
+ Failure by us to respond to changes in consumer preferences could result in lack of sales revenues and may force us out of business.
+ 
+
+ Any change in the preferences of consumers or collectors interested in native Panamanian crafts that we fail to anticipate could reduce the demand for the products we intend to sell. Decisions about our focus and the specific products we plan to sell often are made in advance of distribution, and thus, consumers acquiring them. Failure to anticipate and respond to changes in consumer preferences and demands could lead to, among other things, customer dissatisfaction, failure to attract demand for our products, excess inventories and lower profit margins.
+ 
+
+ We may be unable to obtain sufficient quantities of quality merchandise on acceptable commercial terms because we do not have long-term distribution and manufacturing agreements.
+ 
+
+ We have no current intention to manufacture or assemble any of the products we will sell. We expect to rely solely on the artisans native to the Republic of Panama, who hand-make all goods and typically do not have any formal or legal organization overseeing their production. As a result, the quality and quantity of goods produced may vary greatly and there can be no guarantee we will obtain sufficient quantities of high quality merchandise. Additionally, there is no guarantee that we will be able to obtain any supply of these products at commercially viable prices. Our business would be seriously harmed if we were unable to develop and maintain relationships with the artisans that allow us to obtain sufficient quantities of quality merchandise on acceptable terms. Additionally, we may be unable to establish alternative sources of supply for products to ensure delivery of merchandise in a timely and efficient manner or on terms acceptable to us. If we cannot obtain and stock products at acceptable prices and on a timely basis, we may lose sales. Further, an increase in supply costs could cause our operating losses to increase beyond current expectations.
+ 
+
+ 
+
+ - 8 -
+ 
+
+ The Internet is subject to security and stability risks that could harm our proposed business and expose us to litigation or liability.
+ 
+
+ We plan to operate solely as an internet-based business and are therefore entirely dependent upon the security and stability of the Internet to be able to sell our handmade arts and crafts. Online and mobile commerce and communications depend on the ability to transmit confidential information securely over private and public networks. Once we are operational, any compromise of our ability to transmit such information and data securely or reliably, and any costs associated with preventing or eliminating such problems, could harm our proposed business. 
+ 
+
+ We may need to raise additional funds to pursue our growth strategy or continue our operations, and we may be unable to raise capital when needed. 
+ 
+
+ From time to time, we may seek additional equity or debt financing to provide for the capital expenditures required to finance working capital requirements, develop our products and services or make acquisitions or other investments. In addition, if our business plans change, general economic, financial or political conditions in our markets change, or other circumstances arise that have a material effect on our cash flow, the anticipated cash needs of our business as well as our conclusions as to the adequacy of our available sources of capital could change significantly. Any of these events or circumstances could result in significant additional funding needs, requiring us to raise additional capital. We cannot predict the timing or amount of any such capital requirements at this time. If financing is not available on satisfactory terms, or at all, we may be unable to develop or expand our business at the rate desired and our results of operations may suffer. 
+ 
+
+ We may lose our sole officer and director without an employment agreement.
+ 
+
+ Our proposed operations depend substantially on the skills and experience of our sole officer and director, Jose Soto. We have no other full- or part-time employees besides this individual. Furthermore, we do not maintain key man life insurance on our sole officer and director. Without an employment contract, we may lose our officer and director to other pursuits without a sufficient warning and, consequently, go out of business.
+ 
+
+ Our sole officer and director is currently involved in other business opportunities and may face a conflict in selecting between our company and his other business interests, but has committed to devote approximately 20 hours per week to our operations. In the event Mr. Soto is unavailable, we may experience periodic interruption in our business operations. Such delays could have a significant negative effect on the success of the business. We have not formulated a policy for the resolution of such conflicts. If we were to lose the services of Mr. Soto to other pursuits without a sufficient warning we may, consequently, go out of business.
+ 
+
+ Our sole director and officer is located in a non-United States jurisdiction and so you may have limited effective recourse against our management for misconduct and may not be able to enforce judgments and civil liabilities against our directors, officers and agents.
+ 
+
+ Our sole director and officer, Mr. Soto, resides in Panama and any attempt to enforce liabilities upon such individual under the United States' securities and bankruptcy laws may be difficult. It may be difficult for courts in the United States to obtain jurisdiction over Mr. Soto and, as a result, it may be difficult or impossible for you to enforce judgements rendered against us or Mr. Soto in the United States' courts. Thus, investing in us may pose a greater risk because should any situation arise in the future in which you have a cause of action against Mr. Soto or us, you may face potential difficulties in bringing lawsuits, or if successful, in collecting judgments against our sole officer and director or us.
+ 
+
+ Investors will have limited control over decision-making because Jose Soto, our sole officer and director, controls the majority of our issued and outstanding common stock. 
+ 
+
+ Investors in this offering will have limited control over matters requiring approval by our security holders, including the election of directors. In the event the maximum offering is attained, Jose Soto, our sole officer and director, will continue to own 50% of our outstanding common stock. Assuming the minimum offering amount is sold Mr. Soto will retain approximately 67% of our outstanding common stock. Such concentrated control may also make it difficult for our stockholders to execute or reject transactions which require stockholder approval. This concentration of ownership limits the power to exercise control by the minority shareholders. 
+ 
+
+ 
+
+ - 9 -
+ 
+
+ As a result of placing your invested funds into a separate corporate account as opposed to an escrow account, the funds are subject to attachment by creditors of the company, thereby subjecting you to a potential loss of the funds.
+ 
+
+ Because the funds are being placed in a separate corporate account during the entire offering period, rather than an escrow account, management will have immediate and direct access to the funds during the entire offering period. Thus creditors of the company could try to attach, and ultimately be successful in obtaining or attaching the funds before the offering closes. Investors would lose all or part of their investments, regardless of whether or not the offering closes.
+ 
+
+ U.S. investors may have difficulty enforcing judgments and civil liabilities against Artesanias.
+ 
+
+ Artesanias Corp. is organized in the United States, with its principal executive offices and corporate seat in Panama. Our sole director and officer is a resident of jurisdictions outside the United States. Additionally, we expect the majority of our assets and the assets of our sole officer are located outside the United States. As a result, U.S. investors may find it difficult to effect service of process within the United States upon the company or our sole officer or to enforce outside the United States judgments obtained against the company or our sole officer in U.S. courts, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. Likewise, it may also be difficult for an investor to enforce in U.S. courts judgments obtained against the company or our sole officer in courts in jurisdictions outside the United States, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. It may also be difficult for a U.S. investor to bring an original action in a Panamanian court predicated upon the civil liability provisions of the U.S. federal securities laws against us or our sole director. 
+ 
+
+ You may not be able to sell your shares in our company because there is no public market for our stock.
+ 
+
+ There is no public market for our common stock. In the absence of being listed on a stock exchange or trading platform, no market is available for investors in our common stock to sell their shares. We cannot guarantee that a meaningful trading market will develop. 
+ 
+
+ If our stock ever becomes tradable, of which we cannot guarantee success, the trading price of our common stock could be subject to wide fluctuations in response to various events or factors, many of which are beyond our control. In addition, the stock market may experience extreme price and volume fluctuations, which, without a direct relationship to the operating performance, may affect the market price of our stock.
+ 
+
+ Investors may have difficulty liquidating their investment because our stock will be subject to penny stock regulation.
+ 
+
+ The SEC has adopted rules that regulate broker/dealer practices in connection with transactions in penny stocks. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the Nasdaq system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange system). The penny stock rules require a broker/dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the SEC that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker/dealer also must provide the customer with bid and offer quotations for the penny stock, the compensation of the broker/dealer, and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from such rules, the broker/dealer must make a special written determination that a penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in any secondary market for a stock that becomes subject to the penny stock rules, and accordingly, customers in Company securities may find it difficult to sell their securities, if at all.
+ 
+
+ 
+
+ 
+
+ - 10 -
+ 
+
+ 
+
+ We are currently considered a shell company, which limits the tradability of our shares.
+ 
+
+ We are, currently, considered a "shell company" within the meaning of Rule 12b-2 pursuant to the Securities Exchange Act of 1934 and Rule 405 pursuant to the Securities Act of 1933, in that we currently have nominal operations and nominal assets other than cash. Accordingly, the ability of holders of our common stock to sell their shares may be limited by applicable regulations. As a result of our classification as a shell company, our investors are not allowed to rely on the "safe harbor" provisions of Rule 144, promulgated pursuant to the Securities Act of 1933, so as not to be considered underwriters in connection with the sale of our securities until one year from the date that we cease to be a shell company. Additionally, we may not register our securities on Form S-8 (an abbreviated form of registration statement). We can provide no assurance or guarantee that we will cease to be a shell company and, accordingly, we can provide no assurance or guarantee that there will be a liquid market for our shares. Resultantly, investors may not be able to sell their shares and may lose their entire investment.
+ 
+
+ All of our issued and outstanding common shares are restricted under Rule 144 of the Securities Act, as amended. When the restriction on any or all of these shares is lifted, and the shares are sold in the open market, the price of our common stock could be adversely affected.
+ 
+
+ All of the presently issued and outstanding shares of common stock, aggregating 3,000,000 shares of common stock, are restricted securities as defined under Rule 144 promulgated under the Securities Act and may only be sold pursuant to an effective registration statement or an exemption from registration, if available. Rule 144, as amended, is an exemption that generally provides that a person who has satisfied a six month holding period for such restricted securities may sell, within any three month period (provided we are current in our reporting obligations under the Exchange Act) subject to certain manner of resale provisions, an amount of restricted securities which does not exceed the greater of 1% of a company s outstanding common stock or the average weekly trading volume in such securities during the four calendar weeks prior to such sale. Sales of shares by our shareholders, whether pursuant to Rule 144 or otherwise, may have an immediate negative effect upon the price of our common stock in any market that might develop.
+ 
+
+ Investors may be unable to sell their shares without complying with Blue Sky regulations.
+ 
+
+ Each state has its own securities laws, also known as blue sky laws, which, in part, regulates both the offer and sale of securities. In most instances, offers or sales of a security must be registered or exempt from registration under these blue sky laws of the state or states in which the security is offered and sold. The laws and filing or notification requirements tend to vary between and among states. Investors should consult an attorney or a licensed investment professional prior to delving into blue sky laws. Failure to comply with applicable securities regulations may lead to fines or imprisonment.
+ 
+
+ We are an emerging growth company under the Jumpstart Our Business Startups Act of 2012 ( JOBS Act ), and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.
+ 
+
+ We are an emerging growth company, as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include 
+ 
+
+ 1.
+ Not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;
+ 
+
+ 2.
+ Reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and 
+ 
+
+ 3.
+ Exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
+ 
+
+ 
+
+ - 11 -
+ 
+
+ 
+
+ We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
+ 
+
+ In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing to take advantage of the extended transition period for complying with new or revised accounting standards. As a result, our financial statements may not be comparable to those of companies that comply with public company effective dates.
+ 
+
+ We will remain an emerging growth company for up to five years. However, we would cease to qualify as an emerging growth company if we:
+ 
+
+ 1.
+ Generate annual gross revenues of $1.0 billion or more in a fiscal year;
+ 
+
+ 2.
+ Issue, during the previous three-year period, more than $1.0 billion in non-convertible debt; or
+ 
+
+ 3.
+ Become a large accelerated filer, defined by the SEC as a company with a word-wide public float of its common equity of $700 million or more.
+ 
+
+ Even if we no longer qualify as an emerging growth company , we may still be subject to reduced reporting requirements so long as we are considered a Smaller Reporting Company. 
+ 
+
+ Many of the exemptions available for emerging growth companies are also available to smaller reporting companies like us that have less than $75 million of worldwide common equity held by non-affiliates. So, although we may no longer qualify as an emerging growth company, we may still be subject to reduced reporting requirements.
+ 
+
+ Until our common stock is registered under the Exchange Act, we will not be a fully reporting company.
+ 
+
+ We are not yet a registered company and will not be so until this S-1 is effective. Until then we will only be subject to the reporting requirements imposed by Section 15(d) of the Exchange Act which state that we will be required to file supplementary and periodic information, documents, and reports. However, after effectiveness of this S-1 we intend to file Form 8-A registering a class of securities under Section 12, subjecting us to the full reporting requirements.
+ 
+
+ Until then, and as long as our common stock is not registered under the Exchange Act, we will not be subject to Section 14 of the Exchange Act, which, among other things, prohibits companies that have securities registered under the Exchange Act from soliciting proxies or consents from shareholders without furnishing to shareholders and filing with the SEC a proxy statement and form of proxy complying with the proxy rules.
+ 
+
+ In addition, so long as our common stock is not registered under the Exchange Act, our directors and executive officers and beneficial holders of 10% or more of our outstanding common stock will not be subject to Section 16 of the Exchange Act. Section 16(a) of the Exchange Act requires executive officers and directors, and persons who beneficially own more than 10% of a registered class of equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of common shares and other equity securities, on Forms 3, 4 and 5 respectively. Such information about our directors, executive officers, and beneficial holders will only be available through this (and any subsequent) registration statement, and periodic reports we file thereafter.
+ 
+
+ Furthermore, so long as our common stock is not registered under the Exchange Act, our obligation to file reports under Section 15(d) of the Exchange Act will be automatically suspended if, on the first day of any fiscal year (other than a fiscal year in which a registration statement under the Securities Act has gone effective), we have fewer than 300 shareholders of record. This suspension is automatic and does not require any filing with the SEC. In such an event, we may cease providing periodic reports and current or periodic information, including operational and financial information, may not be available with respect to our results of operations.
+ 
+
+ 
+
+ - 12 -
+ 
+
+ Our common stock may not be transferable without meeting securities registration requirements or exemption therefrom.
+ 
+
+ We have not registered our securities in any jurisdiction and have not identified any exemptions from registration. As a result, investors in our common stock may have difficulty selling their shares unless they are able to register their shares or find an exemption therefrom. Furthermore, broker-dealers may be unwilling or unable to act on behalf of investors in our common stock unless or until the shares are registered, or an applicable exemption from registration is identified, in certain states in which our common stock may be offered or sold.
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+ We have never declared or paid any cash dividends on our common stock. For the foreseeable future, we intend to reinvest any earnings in the development and expansion of our business, and do not anticipate paying any cash dividends on our common stock. Any future determination to pay dividends will be at the discretion of the Board of Directors and will be dependent upon then existing conditions, including our financial condition and results of operations, capital requirements, contractual restrictions, business prospects and other factors that the board of directors considers relevant. Therefore, there can be no assurance that any dividends on the common stock will ever be paid.
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+ Special note regarding forward-looking statements
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+ This prospectus contains forward-looking statements about our business, financial condition and prospects that reflect our management s assumptions and beliefs based on information currently available. We can give no assurance that the expectations indicated by such forward-looking statements will be realized. If any of our assumptions should prove incorrect, or if any of the risks and uncertainties underlying such expectations should materialize, our actual results may differ materially from those indicated by the forward-looking statements.
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+ The key factors that are not within our control and that may have a direct bearing on operating results include, but are not limited to, acceptance of our proposed services and the products we expect to market, our ability to establish a customer base, managements ability to raise capital in the future, the retention of key employees and changes in the regulation of our industry.
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+ There may be other risks and circumstances that management may be unable to predict. When used in this prospectus, words such as, believes, expects, intends, plans, anticipates, estimates and similar expressions are intended to identify and qualify forward-looking statements, although there may be certain forward-looking statements not accompanied by such expressions.
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+September 30, 2014 have been prepared by NSAI (which we refer to as our recent reserve report ), a summary of which is included in Appendix C of this prospectus. Information expressed on a pro forma basis in this summary gives effect to certain transactions as if they had occurred on September 30, 2014 for pro forma balance sheet purposes and on January 1, 2013 for pro forma statements of operations purposes. For a description of these transactions, please read Summary Historical Consolidated and Combined Pro Forma Financial Data and Corporate History and Structure. Overview We are an independent natural gas and oil company focused on the exploitation, development, and acquisition of natural gas, NGL and oil properties with a majority of our activity in the Terryville Complex of North Louisiana, where we are targeting overpressured, liquids-rich natural gas opportunities in multiple zones in the Cotton Valley formation. As of December 31, 2013, our total leasehold position was 347,458 gross (205,818 net) acres, of which 60,041 gross (51,522 net) acres are in what we believe to be the core of the Terryville Complex. We are focused on creating shareholder value primarily through the development of our sizeable horizontal inventory. As of December 31, 2013, we had 1,582 gross (1,091 net) identified horizontal drilling locations, of which 1,431 gross (994 net) identified horizontal drilling locations are located in the Terryville Complex. These total gross identified horizontal drilling locations represent an inventory of over 42 years based on our expected 2014 drilling program. We believe our inventory to be repeatable and capable of generating high returns based on the extensive production history in the area, the results of our horizontal wells drilled to date, and the consistent reservoir quality across multiple target formations. As of December 31, 2013, we had estimated proved, probable and possible reserves of approximately 1,126 Bcfe, 800 Bcfe and 1,711 Bcfe, respectively. As of such date, we operated 98% of our proved reserves, 71% of which were natural gas. For the nine months ended September 30, 2014, 56% of our pro forma MRD Segment revenues were attributable to natural gas production, 22% to NGLs and 22% to oil. For the nine months ended September 30, 2014, we generated pro forma MRD Segment Adjusted EBITDA of $259 million and pro forma net loss of $914 million, and made pro forma capital expenditures of $268 million. For the year ended Table of Contents Index to Financial Statements The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED NOVEMBER 10, 2014 PRELIMINARY PROSPECTUS 30,000,000 Shares Memorial Resource Development Corp. Common Stock $ per share MRD Holdco LLC and certain former management members of WildHorse Resources, LLC (collectively, the selling stockholders ) are offering 30,000,000 shares of Memorial Resource Development Corp. s common stock. The selling stockholders have granted the underwriters a 30-day option to purchase up to an additional 4,500,000 shares of common stock. We will not receive any proceeds from the sale of shares by the selling stockholders, including any shares that the selling stockholders may sell pursuant to the underwriters option to purchase additional shares of common stock. Our common stock is listed on the NASDAQ Global Select Market under the symbol MRD. We are a controlled company as defined under the NASDAQ listing rules because the group consisting of affiliates of Natural Gas Partners beneficially owns over 50% of our shares of outstanding common stock. See Principal and Selling Stockholders. On November 7, 2014, the last reported sale price of our common stock on the NASDAQ Global Select Market was $25.33 per share. Investing in our common stock involves risks that are described in the Risk Factors section beginning on page 23 of this prospectus. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012, and as such, we have elected to take advantage of certain reduced public company reporting requirements for this prospectus and future filings. See Risk Factors and Summary Emerging Growth Company Status. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public Offering Price $ $ Underwriting Discounts and Commissions(1) $ $ Proceeds, Before Expenses, to the Selling Stockholders $ $ (1) See Underwriting for a description of underwriting compensation payable in connection with this offering. The underwriters expect to deliver the shares of common stock on or about , 2014. Joint Book-Running Managers Citigroup Barclays BofA Merrill Lynch BMO Capital Markets Goldman, Sachs & Co. J.P. Morgan Raymond James RBC Capital Markets Wells Fargo Securities Co-Managers Credit Suisse Scotiabank / Howard Weil Simmons & Company International Stephens Inc. Stifel Wunderlich Securities Credit Agricole CIB Natixis The date of this prospectus is , 2014. Table of Contents Index to Financial Statements Commonly Used Defined Terms As used in this prospectus, unless we indicate otherwise: the Company, we, our, us and our company or like terms refer collectively to (i) Memorial Resource Development Corp. and its subsidiaries (other than MEMP and its subsidiaries) for periods after the restructuring transactions described below and (ii) our predecessor (as described below) other than MEMP and its subsidiaries for periods prior to the restructuring transactions; selling stockholders refers to MRD Holdco LLC and certain former management members of WildHorse Resources, LLC named herein; Memorial Production Partners, MEMP and the Partnership refer to Memorial Production Partners LP individually and collectively with its subsidiaries, as the context requires. We own the general partner of MEMP as well as 50% of MEMP s incentive distribution rights; MEMP GP refers to Memorial Production Partners GP LLC, the general partner of the Partnership, which we own; MRD Holdco refers to MRD Holdco LLC, a holding company controlled by the Funds that, together as part of a group owns a majority of our common stock; MRD LLC refers to Memorial Resource Development LLC, which historically owned our predecessor s business and was merged into MRD Operating LLC, our subsidiary, subsequent to our initial public offering; WildHorse Resources refers to WildHorse Resources, LLC, which owns our interest in the Terryville Complex and is our 100% owned subsidiary; our predecessor refers collectively to MRD LLC and its former consolidated subsidiaries, consisting of Classic Hydrocarbons Holdings, L.P., Classic Hydrocarbons GP Co., L.L.C., Black Diamond Minerals, LLC, Beta Operating Company, LLC, MEMP GP, BlueStone, MRD Operating LLC, WildHorse Resources, Tanos Energy LLC and each of their respective subsidiaries, including MEMP and its subsidiaries; the Funds refers collectively to Natural Gas Partners VIII, L.P., Natural Gas Partners IX, L.P. and NGP IX Offshore Holdings, L.P., which collectively control MRD Holdco; restructuring transactions means the transactions described beginning on page 11 that took place in connection with and shortly after the closing of our initial public offering, and pursuant to which we acquired substantially all of the assets of MRD LLC (not including its interests in BlueStone, MRD Royalty, MRD Midstream, Golden Energy Partners LLC or Classic Pipeline); BlueStone refers to BlueStone Natural Resources Holdings, LLC, a subsidiary of MRD Holdco that sold substantially all of its assets in July 2013 for approximately $117.9 million; NGP refers to Natural Gas Partners, a family of private equity investment funds organized to make direct equity investments in the energy industry, including the Funds; MRD Royalty refers to MRD Royalty LLC, a subsidiary of MRD Holdco that owns certain immaterial leasehold interests and overriding royalty interests in Texas and Montana; MRD Midstream refers to MRD Midstream LLC, a subsidiary of MRD Holdco that owns an indirect interest in certain immaterial midstream assets in North Louisiana; and Classic Pipeline refers to Classic Pipeline & Gathering, LLC, a subsidiary of MRD Holdco that owns certain immaterial midstream assets in Texas. Industry and Market Data The market data and certain other statistical information used throughout this prospectus are based on independent industry publications, government publications or other published independent sources. Some data is Table of Contents Index to Financial Statements December 31, 2013, we generated pro forma MRD Segment Adjusted EBITDA of $159 million and pro forma net loss of $2.9 million, and made pro forma total capital expenditures of $203 million. Please see Summary Historical Consolidated and Combined Pro Forma Financial Data Adjusted EBITDA for an explanation of the basis for the pro forma presentation and our use of Adjusted EBITDA to measure the MRD Segment s profitability. Our average net daily production for the nine months ended September 30, 2014 was approximately 208 MMcfe/d (approximately 76% natural gas, 17% NGLs and 7% oil) and our reserve life was 14.8 years. The Terryville Complex represented 84% of our total net production for the nine months ended September 30, 2014. As of December 31, 2013, we produced from 95 horizontal wells and 800 vertical wells. Since January 1, 2014, in the Terryville Complex we have completed and brought online 21 horizontal wells through September 30, 2014, bringing our total number of producing horizontal wells to 41 in our primary formations. The following chart provides information regarding our production growth and the increasing proportion of our horizontal well production since the beginning of 2012. Our Properties Cotton Valley Overview The Cotton Valley formation extends across East Texas, North Louisiana and Southern Arkansas. The formation has been under development since the 1930s and is characterized by thick, multi-zone natural gas and oil reservoirs with well-known geologic characteristics and long-lived, predictable production profiles. Over 21,000 vertical wells have been completed throughout the play. In 2005, operators started redeveloping the Cotton Valley using horizontal drilling and advanced hydraulic fracturing techniques. To date, operators have drilled over 600 horizontal Cotton Valley wells. Some large, analogous redevelopment projects in the Cotton Valley include the Nan-Su-Gail Field in Freestone County, East Texas, where over 40 horizontal wells have been drilled by operators such as Devon Energy Corporation and Marathon Oil Corporation, and the Carthage Table of Contents Index to Financial Statements Table of Contents Index to Financial Statements also based on our good faith estimates. Although we believe these third-party sources are reliable and that the information is accurate and complete, neither we nor the selling stockholders have independently verified the information. Equivalency This prospectus presents certain production and reserves-related information on an equivalency basis. When we refer to oil and natural gas in equivalents, we are doing so to compare quantities of oil with quantities of natural gas. In calculating equivalents, we use a generally recognized standard in which one Bbl of oil and/or NGLs is equivalent to six Mcf of natural gas. This calculation is based on an approximate energy equivalency and does not imply or reflect a value or price relationship. Table of Contents Index to Financial Statements Complex in Panola County, East Texas, where operators such as ExxonMobil Corporation, BP America, Memorial Production Partners LP and Anadarko Petroleum Corporation have drilled over 153 horizontal wells. Cotton Valley Terryville Complex Horizontal Redevelopment We are currently engaged in the horizontal redevelopment of the Terryville Complex in Lincoln Parish, Louisiana utilizing horizontal drilling and completion techniques similar to those employed at the Nan-Su-Gail Field, Carthage Complex in East Texas and other major resource plays across the United States. We have assembled a largely contiguous acreage position in the Terryville Complex of approximately 60,041 gross (51,522 net) acres as of December 31, 2013. The majority of our current and planned development is focused in and around what we believe to be the core of the Terryville Complex. We entered the Terryville Complex via an acquisition from Petrohawk Energy Corporation in April 2010, with the goal of redeveloping the field with horizontal drilling and modern completion techniques. Since that acquisition, we have completed multiple bolt-on acquisitions and in-fill leases to build our current position. We believe the Terryville Complex, which has been producing since 1954, is one of North America s most prolific natural gas fields, characterized by high recoveries relative to drilling and completion costs, high initial production rates with high liquids yields, long reserve life, multiple stacked producing zones, available infrastructure and a large number of service providers. After initially drilling eight vertical pilot wells in the Terryville Complex, we commenced a horizontal drilling program in 2011 to further delineate and define our position. In 2013, we shifted our operational focus to full-scale horizontal redevelopment of the Terryville Complex, going from two rigs to four rigs by the end of that year. Additionally, in the fourth quarter of 2013, we moved to drilling on multi-well pads that allow us to more efficiently drill wells and control costs as we develop our stacked pay zones. We intend to dedicate approximately $304 million of our $351 million drilling and completion budget in 2014 to develop multiple zones within the Terryville Complex, where we expect to drill 33 gross (29 net) horizontal wells and 3 gross (2.7 net) vertical wells. Our horizontal redevelopment program in the Terryville Complex will be focused on increasing our well performance and recoveries. Within the Terryville Complex, as of December 31, 2013, we had 945 Bcfe, 688 Bcfe and 1,643 Bcfe of estimated proved, probable and possible reserves, respectively, and a drilling inventory consisting of 1,431 gross (994 net) identified horizontal drilling locations, including 91 gross (72 net) drilling locations to which we have attributed proved undeveloped reserves as of December 31, 2013. Since initiating our horizontal drilling program in 2011, we have drilled 44 gross (38 net) horizontal wells. Within the Terryville Complex, on a proved reserves basis, we operate approximately 99% of our existing acreage and hold an average working interest of approximately 74% across our acreage. Our high operating control allows us to more efficiently and economically manage the redevelopment of this extensive resource. We believe seismic data, as well as information gathered from the results of our existing 275 vertical and 46 horizontal wells throughout the field, support the existence of at least ten stacked pay zones across the Terryville Complex. Our redevelopment program currently targets four of the stacked pay zones in the Cotton Valley formation zones we term the Upper Red, Lower Red, Lower Deep Pink and Upper Deep Pink, all of which we are developing with horizontal wells through pad drilling. These four zones have an overall thickness ranging from 400 to 890 feet across our acreage position. We believe the overpressured nature of this section of the Cotton Valley formation is highly productive when accessed through horizontal drilling and fracture stimulation technologies. These qualities, when combined with the liquids-rich nature of the natural gas, high initial rates of production and competitive well costs, produce what we believe to be amongst the highest rate of return wells in the nation. Further, there are additional opportunities for redevelopment in the zones above the four main zones. NSAI has audited over $1 billion PV-10 and 677 Bcfe in our possible reserve category as of December 31, 2013 for the redevelopment of these additional zones. Please see Reserves. Table of Contents Index to Financial Statements Our well results have shown consistency in initial production, decline rates and estimated ultimate recovery. The consistency of these results gives us confidence that the full-scale redevelopment of the Terryville Complex that we began in 2013 will continue to be successful. The table below details certain information on estimated ultimate recoveries and production on a gross basis for our 41 existing horizontal wells currently producing from our four primary target zones in the Terryville Complex to the extent such data is available as of the dates and for the periods presented below. The wells below highlight the consistency of our drilling results in the four primary target zones in which we plan to focus our future development activity. Lateral Length (Feet) Producing Wells Cumulative Production (Bcfe) Gross Wellhead Flow Rates After Processing (MMcfe/d)(2)(3) EUR (Bcfe)(1) EUR Bcfe/ 1,000 First Production Days Producing D&C ($MM) Well Name 0-30 0-90 91-180 181-360 Upper Red LD Barnett 23H-2 4,015 12.3 3.1 1/30/2012 975 5.0 14.5 12.0 7.7 5.6 6.7 Colquitt 20 17H-1 4,357 11.5 2.6 7/30/2012 793 4.3 17.5 12.6 7.2 5.1 7.8 Dowling 22 15H-1 5,376 9.4 1.8 9/22/2012 739 5.7 16.3 15.6 11.1 8.2 8.8 Nobles 13H-1 4,216 9.1 2.1 11/17/2012 683 4.6 21.5 16.7 9.9 6.5 7.8 Sidney McCullin 16 21H-1 4,604 13.8 3.0 1/19/2013 620 5.0 17.4 14.2 10.8 8.4 8.1 Wright 14 11 HC-1 5,250 11.9 2.3 5/27/2013 492 5.5 19.6 18.1 16.1 8.4 8.8 BF Fallin 22 15H-1 5,122 12.3 2.4 6/17/2013 471 3.9 14.8 13.7 11.8 5.9 7.5 Dowling 20 17H-1 4,327 9.0 2.1 7/22/2013 436 2.6 15.2 11.0 5.7 4.5 10.7 Gleason 31H-1 3,692 2.4 0.7 8/12/2013 415 0.6 2.9 2.3 1.6 1.2 9.5 Burnett 26H-1 2,405 5.5 2.3 9/22/2013 374 1.2 6.9 5.6 3.5 2.4 6.9 Drewett 17 8H-1 4,010 15.6 3.9 11/13/2013 322 3.9 22.1 18.6 11.9 7.7 Wright 13 12 HC-2 6,009 24.0 4.0 12/21/2013 284 4.6 22.7 19.6 16.3 8.5 LA Minerals 15 22H-2 5,814 17.3 3.0 1/21/2014 253 3.4 17.8 16.1 13.4 8.8 Wright 13 24 HC-3 6,606 20.9 3.2 4/14/2014 170 3.4 30.3 24.6 10.8 Wright 13 24 HC-1 6,678 15.5 2.3 4/14/2014 170 2.8 25.0 20.4 11.8 TL McCrary 14 11 HC-5 5,875 30.0 5.1 4/14/2014 170 3.0 22.9 23.3 10.2 LA Minerals 19 30 HC-2 6,912 15.1 2.2 5/29/2014 125 2.3 25.1 20.4 10.8 LA Minerals 19 30 HC-1 6,519 19.6 3.0 6/1/2014 122 2.0 21.5 17.7 11.6 Werner 29H-1 3,410 4.7 1.4 8/13/2014 49 0.4 8.6 11.0 Werner 29 32 5 HC-1 6,810 9.7 1.4 8/13/2014 49 0.8 18.4 10.4 Werner 29 32 5 HC-2 8,300 16.5 2.0 8/13/2014 49 1.2 26.1 12.2 Temple 8H-1 2,403 6.3 2.6 8/24/2014 38 0.4 12.7 9.6 Temple 8 17 HC-1 6,210 2.9 0.5 8/29/2014 33 0.3 8.4 11.9 TL McCrary 14 11 HC-2 4,401 NA NA 9/25/2014 6 0.1 7.7 TL McCrary 14 11 HC-4 4,810 NA NA 9/25/2014 6 0.0 9.0 Lower Red TL McCrary 14H-1 4,544 12.7 2.8 5/1/2012 883 4.5 14.4 11.7 8.3 5.4 7.7 Nobles 13H-2 4,060 5.6 1.4 11/17/2012 683 3.3 16.0 11.9 8.2 5.2 7.8 LA Methodist Orphanage 14H-1 3,637 9.5 2.6 2/15/2013 593 4.0 13.9 13.0 9.7 6.3 9.1 Dowling 21 16H-1 4,590 8.4 1.8 3/18/2013 562 3.0 13.0 10.1 6.5 4.5 6.6 Drewett 17 8H-2 3,700 4.2 1.1 11/13/2013 322 1.2 8.7 6.2 3.2 7.0 Wright 13 12 HC-1 5,409 9.4 1.7 12/21/2013 284 2.2 14.7 11.4 7.2 9.3 LA Minerals 15 22H-1 5,926 8.1 1.4 1/21/2014 253 1.9 13.8 10.9 6.4 7.8 Wright 13 24 HC-4 6,518 15.1 2.3 4/14/2014 170 2.6 25.7 19.6 13.4 LA Minerals 19 30 HC-3 5,356 2.5 0.5 5/29/2014 125 0.6 8.8 5.9 12.1 LA Minerals 19 30 HC-4 6,469 3.5 0.5 6/1/2014 122 0.9 13.6 8.5 13.8 TL McCrary 14 11 HC-1 4,010 NA NA 9/25/2014 6 0.0 8.9 TL McCrary 14 11 HC-3 4,620 NA NA 9/25/2014 6 0.0 8.3 Lower Deep Pink Zone LA Methodist Orphanage 14H-2 3,550 6.1 1.7 2/15/2013 593 3.5 14.2 11.6 7.6 5.7 6.1 Wright 13 12 HC-4 5,010 5.8 1.2 12/21/2013 284 1.6 11.8 8.8 4.8 7.0 Wright 13 12 HC-3 5,706 5.4 0.9 12/21/2013 284 1.6 12.5 9.3 5.0 7.4 Upper Deep Pink Zone Werner 29 32 5 HC-3 6,679 3.1 0.5 8/13/2014 49 0.3 7.2 10.1 Averages(4) All Wells 5,071 10.7 2.1 319 2.4 16.1 13.6 8.4 5.6 9.2 Upper Red 5,125 12.8 2.5 314 2.7 17.7 15.7 9.8 5.6 9.4 Lower Red 4,903 7.9 1.6 334 2.0 14.3 10.9 7.1 5.4 9.3 Lower Deep Pink 4,755 5.8 1.3 387 2.2 12.8 9.9 5.8 5.7 6.8 Upper Deep Pink 6,679 3.1 0.5 49 0.3 7.2 10.1 Table of Contents Index to Financial Statements (1) EUR represents the Estimated Ultimate Recovery or sum of total gross remaining proved reserves attributable to each location in our recent reserve report and cumulative sales from such location. EUR is shown on a combined basis for oil/condensates, gas and NGLs after the effects of processing. (2) Production data is as of September 30, 2014 and shown gross on a combined basis after the effects of processing. (3) Periodic flow rates start on day 4, with days 1 through 3 used to allow clean up associated with well completion. The 30-day flow rates therefore start on day 4 and continue 30 days to day 33 and the 90-day flow rates go from day 4 to day 93. (4) We also have five horizontal producing wells outside of the four primary target zones. These averages do not include such wells. Cotton Valley Terryville Complex Proved Reserves Update As of September 30, 2014, within the core Terryville Complex, we had proved reserves of 849 Bcfe based on our recent reserve report, and an aggregate drilling inventory of 1,411 gross identified drilling locations, taking into account drilling activity during the first nine months of 2014. The PV-10 of our proved reserves within the Terryville Complex as of September 30, 2014 was $1.6 billion. PV-10 is a non-GAAP financial measure and differs from standardized measure, the most directly comparable GAAP financial measure. Please see Reserves. SEC pricing for natural gas and oil used in calculating the PV-10 of such proved reserves as of September 30, 2014 was $4.23 per Mcf and $95.56 per Bbl, respectively, based on the unweighted average of the first-day-of-the-month prices for each of the twelve months preceding September 2014. East Texas We own and operate approximately 54,337 gross (42,894 net) acres as of December 31, 2013 in Texas, where we are currently producing primarily from the Cotton Valley, Travis Peak and Bossier formations and targeting the Cotton Valley formation for future development. From January 1, 2011 through December 31, 2013, we have drilled and completed 28 gross (10.3 net) wells and are operating one rig in East Texas as of December 31, 2013. In 2014, we plan to invest $29 million to drill 4 gross (4 net) wells in East Texas in the Joaquin Field of Panola and Shelby Counties. As of December 31, 2013, we had approximately 108 gross identified horizontal drilling locations in East Texas, including 54 gross (43 net) drilling locations to which we have attributed proved undeveloped reserves as of December 31, 2013. For the nine months ended September 30, 2014, our average net daily production from our East Texas properties was 27 MMcfe/d, of which 75% was natural gas. Within our East Texas properties, on a proved reserves basis, we operate approximately 94% of our existing properties. Rockies We own approximately 162,375 gross (66,191 net) acres as of December 31, 2013 in our Rockies region and for the nine months ended September 30, 2014 our average net daily production from this region was 6 MMcfe/d. In 2014, we plan to invest $18 million to complete 2 gross (2 net) vertical wells in the Tepee Field of the Piceance Basin targeting the Mancos and Williams Fork formations. As of December 31, 2013, we had approximately 174 gross identified vertical drilling locations in the Tepee Field in our Rockies properties. Table of Contents Index to Financial Statements Reserves Our estimates of proved reserves are prepared by NSAI, and our estimates of probable and possible reserves are prepared by our management and audited by NSAI. As of December 31, 2013, we had 1,126 Bcfe, 800 Bcfe and 1,711 Bcfe of estimated proved, probable and possible reserves, respectively. As of this date, our proved reserves were 71% gas and 29% NGLs and oil. Additionally, the PV-10 of our proved reserves was $1,469 million, the PV-10 for our probable reserves was $1,052 million and the PV-10 for our possible reserves was $2,386 million. The following table provides summary information regarding our estimated proved, probable and possible reserves data by area based on our reserve report as of December 31, 2013 and our average net daily production by area for the nine months ended September 30, 2014: Proved Total (Bcfe) % Gas % Developed Proved PV-10 (in millions)(1) Probable Total (Bcfe)(2) Probable PV-10 (in millions)(1) Possible Total (Bcfe)(2) Possible PV-10 (in millions)(1) Average Net Daily Production (MMcfe/d) Terryville Complex 945 71 % 33 % $ 1,341 688 $ 1,032 1,643 $ 2,383 175 East Texas 175 75 % 29 % 110 109 18 66 3 27 Rockies 6 49 % 100 % 18 2 2 2 1 6 Total 1,126 71 % 33 % $ 1,469 800 $ 1,052 1,711 $ 2,386 208 (1) In this prospectus, we have disclosed our PV-10 based on our reserve report. PV-10 is a non-GAAP financial measure and represents the period-end present value of estimated future cash inflows from our natural gas and crude oil reserves, less future development and production costs, discounted at 10% per annum to reflect timing of future cash flows and using SEC pricing assumptions in effect at the end of the period. SEC pricing for natural gas and oil of $3.67 per Mcf and $93.42 per Bbl was based on the unweighted average of the first-day-of-the-month prices for each of the twelve months preceding December 2013. PV-10 differs from standardized measure, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes. Moreover, GAAP does not provide a measure of estimated future net cash flows for reserves other than proved reserves. Because PV-10 estimates of probable and possible reserves are more uncertain than PV-10 and standardized estimates of proved reserves, but have not been adjusted for risk due to that uncertainty, they may not be comparable with each other. Nonetheless, we believe that PV-10 estimates for reserve categories other than proved present useful information for investors about the future net cash flows of our reserves in the absence of a comparable GAAP measure such as standardized measure. Because of this, PV-10 can be used within the industry and by creditors and securities analysts to evaluate estimated net cash flows from proved reserves on a more comparable basis. In addition, investors should be cautioned that estimates of PV-10 for probable and possible reserves, as well as the underlying volumetric estimates, are inherently more uncertain of being recovered and realized than comparable measures for proved reserves, and that the uncertainty for possible reserves is even more significant. Our PV-10 estimates of proved reserves and our standardized measure are equivalent as of December 31, 2013 because, prior to the completion of our initial public offering, we were not subject to entity level taxation. Accordingly, no provision for federal income taxes has been provided because taxable income for 2013 was passed through to our equity holders. However, had we not been a tax exempt entity as of December 31, 2013, our estimated discounted future income tax in respect of our proved, probable and possible reserves would have been approximately $401 million, $368 million and $835 million, respectively. Since the closing of our initial public offering, we are treated as a taxable entity for federal income tax purposes and our future income taxes will be dependent upon our future taxable income. Neither PV-10 nor standardized measure represents an estimate of fair market value of our natural gas and oil properties. We and others in the industry use PV-10 as a measure to compare the relative size and value of estimated reserves held by companies without regard to the specific tax characteristics of such entities. (2) Substantially all of our estimated probable and possible reserves are classified as undeveloped. Drilling Inventory and Capital Budget We intend to develop our multi-year drilling inventory by utilizing our significant expertise in horizontal drilling and fracture stimulation to grow our production, reserves and cash flow. For 2014, we have budgeted a total of $351 million to drill 39 gross (34 net) operated horizontal wells. We expect to fund our 2014 development primarily from cash flows from operations. The majority of our drilling locations and our 2014 development program are focused on the Terryville Complex, where we plan to invest $304 million on drilling 33 gross (29 net) horizontal wells and 3 gross (2.7 net) vertical wells. In East Texas, we plan to invest $29 million on drilling and completing 4 gross (4 net) horizontal wells. In the Rockies, we plan to invest $18 million on completing 2 gross (2 net) vertical wells in the Tepee Field. Table of Contents Index to Financial Statements The following table provides information regarding our acreage and drilling locations by area as of December 31, 2013: Net Acreage WI% Gross Horizontal Drilling Locations(1)(2)(3) Gross Horizontal Drilling Inventory (years) Proved Probable Possible Management Total Gross Net Terryville Complex 96,733 74 % 91 147 450 743 1,431 994 43 East Texas 42,894 79 % 54 39 15 108 92 27 Rockies 66,191 41 % 23 20 43 4 Total 205,818 59 % 145 209 485 743 1,582 1,091 42 (1) The above table excludes 192 proved vertical drilling locations in our reserve report in the Terryville Complex and 174 identified vertical locations based on management estimates in the Rockies. (2) Please see Business Our Operations Drilling Locations for more information regarding the process and criteria through which these drilling locations were identified. The drilling locations on which we actually drill will depend on the availability of capital, regulatory approval, commodity prices, costs, actual drilling results and other factors. Please see Risk Factors Risks Related to Our Business Our identified drilling locations, which are scheduled out over many years, are susceptible to uncertainties that could materially alter the occurrence or timing of their drilling. Proved, probable and possible locations are based on our reserve report. Management locations are based on management estimates of additional identified drilling locations. (3) As of September 30, 2014, we had an aggregate drilling inventory of 1,411 identified gross horizontal inventory locations in the Terryville Complex, taking into account drilling activity during the first nine months of 2014. Please see Our Properties Cotton Valley Terryville Complex Proved Reserves Update. Our extensive inventory and horizontal drilling program in the Terryville Complex is currently focused on four zones within the Cotton Valley formation the Upper Red, Lower Red, Lower Deep Pink and Upper Deep Pink. The table below sets forth our drilling locations by zone as of December 31, 2013 along with the average results for the wells we have drilled within each zone. Please see Business Our Properties Cotton Valley Terryville Complex Horizontal Redevelopment for more detail on our properties in the Terryville Complex and the table on page 99 for the 30 day initial production rate and EUR condensate volumes. Lower Cotton Valley Zone Gross Horizontal Drilling Locations(1)(4) Average Historical Results(2) Producing Wells Drilled(1) EUR (Bcfe)(3) Drilling and Completion Costs ($MM) Proved Probable Possible Management Total Upper Red 47 42 40 313 442 25 12.8 $ 9.4 Lower Red 40 40 36 276 392 12 7.9 9.3 Lower Deep Pink 4 28 47 79 158 3 5.8 6.8 Upper Deep Pink 37 42 75 154 1 3.1 10.1 Other Zones 285 285 Total Terryville Complex 91 147 450 743 1,431 41 10.7 $ 9.2 (1) Please see Business Our Operations Drilling Locations for more information regarding the process and criteria through which these drilling locations were identified. The drilling locations on which we actually drill will depend on the availability of capital, regulatory approval, commodity prices, costs, actual drilling results and other factors. Please see Risk Factors Risks Related to Our Business Our identified drilling locations, which are scheduled out over many years, are susceptible to uncertainties that could materially alter the occurrence or timing of their drilling. Proved, probable and possible locations are based on our reserve report. Management locations are based on management estimates of additional identified drilling locations. (2) Relates to the 41 horizontal wells drilled by us in the four primary target zones in the Terryville Complex and included in our recent reserve report as proved developed reserves as of September 30, 2014. (3) EUR represents the Estimated Ultimate Recovery or the sum of total gross remaining proved reserves attributable to each location in our recent reserve report and cumulative sales from such location. EUR is shown at the wellhead on a combined basis for oil/condensates and wet gas. (4) As of September 30, 2014, we had an aggregate drilling inventory of 1,411 identified gross horizontal inventory locations in the Terryville Complex, taking into account drilling activity during the first nine months of 2014. Please see Our Properties Cotton Valley Terryville Complex Proved Reserves Update. Table of Contents Index to Financial Statements Our Terryville horizontal development program in 2014 has an average working interest of 86% and our total horizontal development inventory has an average working interest of 69%. For the Terryville Complex, our 2014 budget assumes an average drilling and completion cost of $9.5 million for gross horizontal wells ($8.3 million per net well) and is based on an average lateral length of 5,824 feet. As part of our long-term development plan, the lateral length of our planned wells is expected to increase and we expect wells within the Terryville Complex to increase to a 7,500 foot lateral length. Business Strategies Our primary objective is to build shareholder value through growth in reserves, production and cash flows by developing and expanding our significant portfolio of drilling locations. To achieve our objective, we intend to execute the following business strategies: Grow production, reserves and cash flow through the development of our extensive drilling inventory. We believe our extensive inventory of low-risk drilling locations, combined with our operating expertise, will enable us to continue to deliver production, reserve and cash flow growth and create shareholder value. As of December 31, 2013, we had assembled an aggregate drilling inventory of 1,582 gross identified horizontal drilling locations, 90% of which are in the Terryville Complex, representing a drilling inventory of over 43 years based on our expected 2014 drilling program. We believe that the risk and uncertainty associated with our core acreage positions in the Terryville Complex has been largely reduced through our development activity, and because those positions are in areas with extensive drilling and production history. Since initiating our horizontal drilling program with one rig in 2011, we have invested over $521 million in the Terryville Complex through September 30, 2014. With six rigs running in the Terryville Complex as of September 30, 2014, we are one of the most active drillers in the Cotton Valley formation. We intend to dedicate approximately $304 million of our $351 million drilling and completion budget in 2014 to develop the overpressured liquids-rich Terryville Complex through multi-well pad drilling. We believe multiple vertically stacked producing horizons in the Terryville Complex can be developed using horizontal drilling techniques, thus enhancing the economics of this field. Enhance returns through prudent capital allocation and continued improvements in operational and capital efficiencies. We continually monitor and adjust our drilling program with the objective of achieving the highest total returns on our portfolio of drilling opportunities. We believe we will achieve this objective by (i) minimizing the capital costs of drilling and completing horizontal wells through knowledge of the target formations, (ii) maximizing well production and recoveries by optimizing lateral length, the number of frac stages, perforation intervals and the type of fracture stimulation employed, (iii) targeting specific zones within our leasehold position to maximize our hydrocarbon mix based on the existing commodity price environment and (iv) minimizing operating costs through efficient well management. Exploit additional development opportunities on current acreage. Our existing asset base provides numerous opportunities for our highly experienced technical team to create shareholder value by increasing our inventory beyond our currently identified drilling locations and ultimately by growing our estimated proved reserves. In the Terryville Complex, we are currently targeting multiple stacked horizons. We also believe our East Texas region has a significant inventory of low-risk, liquids-rich horizontal drilling locations. Finally, we continue to evaluate our leasehold positions in the Rockies and have preliminarily identified over 170 potential vertical locations. Maintain a disciplined, growth oriented financial strategy. We intend to fund our growth primarily with internally generated cash flows while maintaining ample liquidity and access to the capital markets. Furthermore, we plan to hedge a significant portion of our expected production to reduce our exposure to downside commodity price fluctuations and enable us to protect our cash flows and maintain liquidity to fund our drilling program. Table of Contents Index to Financial Statements Since approximately 76% of our acreage in the Terryville Complex was held by production as of December 31, 2013 and no significant drilling commitments are needed to hold our remaining acreage in the near term, we are able to allocate capital among projects in a manner that optimizes both costs and returns, resulting in a highly efficient drilling program. Make opportunistic acquisitions that meet our strategic and financial objectives. We will seek to acquire oil and gas properties that we believe complement our existing properties in our core areas of operation. In addition to our focus on the Terryville Complex, we are pursuing other properties that provide opportunities for the addition of reserves and production through a combination of exploitation, development, high-potential exploration and control of operations. We follow a technology driven strategy to establish large, contiguous leasehold positions in the core of prolific basins and opportunistically add to those positions through bolt-on acquisitions over time. We entered into the Terryville Complex through strategic acquisitions and grassroots leasing efforts, amassing a land position as of December 31, 2013 of 96,733 net acres, 51,522 net acres of which we believe to be in the core of the play. We will continue to identify and opportunistically acquire additional acreage and producing assets to complement our multi-year drilling inventory. Competitive Strengths We believe that the following strengths will allow us to successfully execute our business strategies. Large, concentrated position in one of North America s leading plays. As of December 31, 2013, we owned approximately 60,041 gross (51,522 net) acres in what we believe to be the core of the Terryville Complex in Lincoln Parish, which we believe to be one of North America s most prolific liquids-rich natural gas fields, characterized by consistent and predictable geology and multiple stacked pay formations confirmed by extensive vertical well control. Through September 30, 2014, our drilling program in the Terryville Complex has produced some of the top performing gas wells in the United States in the previous two years, with single horizontal well results having achieved EURs averaging 10.7 Bcfe per well. Through September 30, 2014, we have brought 41 wells online within our four primary target zones with average 30-day initial production rates of 16.1 MMcfe/d and average drilling and completion costs of $9.2 million per well. Approximately 76% of our acreage in the Terryville Complex was held by production at December 31, 2013 and there are no significant lease expirations until 2017. Additionally, all of our acreage in this play can be held by running a one-rig program over the next 18 months. De-risked acreage position with multi-year inventory of liquids-rich drilling opportunities. As of December 31, 2013, we had a drilling inventory consisting of 1,582 gross identified horizontal drilling locations, of which approximately 145 are gross proved undeveloped locations. Based on our expected 2014 drilling program and gross identified drilling locations, we have over 42 years of liquids-rich drilling inventory. The majority of our drilling activity has been and will continue to be focused in the Terryville Complex, where we produce liquids-rich natural gas from the overpressured Cotton Valley formation. We have used subsurface data from our vertical wells coupled with 3-D seismic data to identify and prioritize our inventory based on returns. This liquids-rich gas formation allows for NGL processing that, when coupled with the condensate produced, results in strong well economics. For the nine months ended September 30, 2014, 56% of our MRD Segment revenues were attributable to natural gas, 22% to NGLs and 22% to oil. Significant operational control with low cost operations. On a proved reserves basis, we operate 99% of our properties and have operational control of all of our drilling inventory in the Terryville Complex. We believe maintaining operational control will enable us to enhance returns by implementing more efficient and cost-effective operating practices, through the selection of economic drilling locations, opportunistic timing of development, continuous improvement of drilling, completion and stimulation techniques and development on multi-well pads. As a result of the contiguous nature of our leasehold in the Terryville Complex, its geologic continuity and cross unit lateral pooling, we are able to drill consistently long laterals, averaging over 5,071 Table of Contents Index to Financial Statements lateral feet, which helps us to reduce costs on a per-lateral foot basis and increase our returns. We expect the average lateral length of the 33 gross wells that we expect to drill in the Terryville Complex in 2014 to be 5,824 feet per well. Operating in mature basins in North Louisiana and East Texas allows us to take advantage of the available and extensive midstream infrastructure and accelerate our development plan without encountering significant constraints in either takeaway or processing capacity. Our operational control allows us to focus on operating efficiency, which has resulted in our MRD Segment lease operating costs declining 35% from $0.50 per Mcfe for the nine months ended September 30, 2013 to $0.33 per Mcfe for the nine months ended September 30, 2014. Proven and incentivized executive and technical team. We believe our management and technical teams are one of our principal competitive strengths due to our team s significant industry experience and long history of working together in the identification, execution and integration of acquisitions, cost efficient management of profitable, large scale drilling programs and a focus on rates of return. Additionally, our technical team has substantial expertise in advanced drilling and completion technologies and decades of expertise in operating in the North Louisiana and East Texas regions. The members of our management team collectively have an average of 22 years of experience in the oil and natural gas industry. John A. Weinzierl, our Chief Executive Officer, has 24 years of oil and natural gas industry experience as a petroleum engineer, a strong commercial and technical background and extensive experience acquiring and managing oil and natural gas properties. Our management team has a significant economic interest in us directly and through its equity interests in our controlling stockholder, MRD Holdco. We believe our management team is motivated to deliver high returns, create shareholder value and maintain safe and reliable operations. Our relationship with MEMP. We own a 0.1% general partner interest in MEMP through our ownership of its general partner as well as 50% of MEMP s incentive distribution rights. MEMP s objective as a master limited partnership is to generate stable cash flows, allowing it to make quarterly distributions to its limited partners and, over time, to increase those quarterly distributions. As a result of its familiarity with our management team and our asset base and our track record of prior drop-down transactions, we believe that MEMP is a natural purchaser of properties from us that meet its acquisition criteria. We believe this mutually beneficial relationship enhances MEMP s ability to generate consistent returns on its oil and natural gas properties, provides us with a growing source of cash flow from our partnership interests in MEMP and allows us to monetize producing non-core properties. Since MEMP s initial public offering, we have consummated drop-down transactions with MEMP totaling approximately $391 million. In addition, we may have the opportunity to work jointly with MEMP to pursue certain acquisitions of oil and natural gas properties that may not otherwise be attractive acquisition candidates for either of us individually. While we believe that MEMP would be a preferred acquirer of our mature, non-core assets, we are under no obligation to offer to sell, and it is under no obligation to offer to buy, any of our properties. Financial strength and flexibility. During 2013, we generated $159 million of pro forma MRD Segment Adjusted EBITDA and made pro forma total capital expenditures of $203 million. During the nine months ended September 30, 2014, we generated pro forma MRD Segment Adjusted EBITDA of $259 million and made pro forma capital expenditures of $268 million. We intend to continue to fund our organic growth predominantly with internally generated cash flows while maintaining ample liquidity for opportunistic acquisitions. We will continue to maintain a disciplined approach to spending whereby we allocate capital in order to optimize returns and create shareholder value. We seek to protect these future cash flows and liquidity levels by maintaining a three-to-five year rolling hedge program. As of September 30, 2014, our total liquidity, consisting of cash on hand and available borrowing capacity under our revolving credit facility, was approximately $650.2 million. Table of Contents Index to Financial Statements Initial Public Offering and Recent Developments On June 18, 2014, we completed our initial public offering of 49,220,000 shares of common stock at a price to the public of $19.00 per share. Of the 49,220,000 shares offered, 21,500,000 were offered by us and 27,720,000 were offered by the selling stockholder, MRD Holdco. We did not receive any proceeds from the sale of shares by MRD Holdco. We used the net proceeds of approximately $380.2 million from our sale of shares in our initial public offering (i) to redeem the 10.00%/10.75% Senior PIK toggle notes due 2018 (the PIK notes ) issued by MRD LLC in their entirety and to pay the applicable premium in connection with such redemption and accrued and unpaid interest to the date of redemption, (ii) together with borrowings of approximately $614.5 million under our $2.0 billion revolving credit facility entered into in connection with the closing of our initial public offering, to make a cash payment to certain former management members of WildHorse Resources in connection with their contribution to us of their membership interests and incentive units in WildHorse Resources, (iii) to repay borrowings outstanding under WildHorse Resources revolving credit facility and second lien term loan, which we refer to collectively as WildHorse Resources credit agreements, (iv) to reimburse MRD LLC for interest paid on the PIK notes and (v) to pay costs associated with our revolving credit facility. On July 10, 2014, we completed a private placement of $600.0 million aggregate principal amount of 5.875% senior unsecured notes (the MRD Senior Notes ) at par. The MRD Senior Notes will mature on July 1, 2022. Interest on the MRD Senior Notes accrues from July 10, 2014 and will be payable semiannually on January 1 and July 1 of each year, commencing on January 1, 2015. The net proceeds of approximately $586.0 million, after deducting the initial purchasers discounts and commissions and offering expenses, were used to repay a portion of the borrowings outstanding under our revolving credit facility. The amounts to be repaid under our revolving credit facility were incurred to repay the amounts outstanding under WildHorse Resources credit facilities in connection with the closing of our initial public offering. In conjunction with the closing of the offer and sale of the MRD Senior Notes, the borrowing base under our revolving credit facility was automatically decreased by $56.5 million. On November 4, 2014, our wholly-owned subsidiary, Terryville Mineral & Royalty Partners LP ( TRVL ), filed a registration statement on Form S-1 with the SEC in connection with its proposed initial public offering of common units representing limited partner interests. In connection with the closing of the proposed offering, we will contribute to TRVL certain overriding royalty interests in approximately 27,000 gross acres in the Terryville Complex in exchange for limited partner interests in TRVL. The royalty interests will entitle TRVL to receive 7% of gross revenues from production within such acreage on all of our existing horizontal producing wells and future wells completed by us. TRVL intends to distribute the net proceeds from the proposed offering to us. A registration statement relating to these securities has been filed with the SEC but has not yet become effective. These securities may not be sold nor may any offers to buy be accepted prior to the time the registration statement becomes effective, and this prospectus does not constitute an offer to sell or a solicitation of any offers to buy these securities. Acquisition History We built out our leasehold positions in North Louisiana, East Texas and the Rocky Mountains primarily through the following acquisition activities: In November 2007, we acquired interests in the Joaquin Field, which is the core of our East Texas acreage; In December 2007, we acquired interests in the Tepee Field in the Piceance Basin in Colorado; In April and May 2010, we acquired interests in the Terryville Complex and other North Louisiana fields, which are the core of our North Louisiana acreage; Table of Contents Index to Financial Statements In November 2010, we acquired interests in the Spider and E. Logansport Fields in North Louisiana; In May 2012, we acquired interests in the Terryville Complex and Double A Field in North Louisiana and East Texas; In April 2013, we acquired interests in the West Simsboro and Simsboro Fields of the Terryville Complex in North Louisiana; In November 2013, we acquired the remaining equity interests in Classic Hydrocarbons Holdings, L.P., Classic Hydrocarbons GP Co., L.L.C. and Black Diamond Minerals, LLC, which hold oil and natural gas properties in East Texas, North Louisiana and the Rocky Mountains; and In February 2014, we repurchased net profits interests in the Terryville Complex from an affiliate of NGP for $63.4 million after customary adjustments. These net profits interests were originally sold to the NGP affiliate upon the completion of certain acquisitions in 2010 by WildHorse Resources. Our Principal Stockholder Our principal stockholder is MRD Holdco, which is controlled by the Funds, which are three of the private equity funds managed by NGP. Upon completion of this offering, MRD Holdco, one of the selling stockholders in this offering, will own approximately 40% of our common stock (or approximately 38% if the underwriters option to purchase additional shares from the selling stockholders is exercised in full). Pursuant to a voting agreement, MRD Holdco also has the right to direct the vote of an additional approximately 18% of our common stock (or approximately 18% if the underwriters option to purchase additional shares from the selling stockholders is exercised in full) owned by certain former management members of WildHorse Resources (including the other selling stockholders). The Funds also collectively indirectly own 50% of MEMP s incentive distribution rights, and MRD Holdco owns 5,360,912 subordinated units of MEMP, representing an approximate 6.2% limited partner interest in MEMP. We are also a party to certain other agreements with MRD Holdco, the Funds and certain of their affiliates. For a description of the voting agreement and these other agreements, please read Certain Relationships and Related Party Transactions. Founded in 1988, NGP is a family of private equity investment funds, with cumulative committed capital of over $14.5 billion since inception, organized to make investments in the natural resources sector. NGP is part of the investment platform of NGP Energy Capital Management, a premier investment franchise in the natural resources industry, which together with its affiliates has managed over $17 billion in cumulative committed capital since inception. Our Interest in Memorial Production Partners LP Through our ownership of its general partner, we control MEMP. We also own 50% of its incentive distribution rights. MEMP is a publicly traded limited partnership engaged in the acquisition, exploitation, development and production of oil and natural gas properties in the United States, with assets consisting primarily of producing oil and natural gas properties that are located in East Texas/North Louisiana, the Rockies, South Texas, the Permian and offshore southern California. Most of MEMP s properties are located in large, mature oil and natural gas reservoirs with well-known geologic characteristics and long-lived, predictable production profiles and modest capital requirements. Because we control MEMP, we are required to consolidate MEMP for accounting and financial reporting purposes, even though we and MEMP have independent capital structures. During the year ended December 31, 2013 and nine months ended September 30, 2014, less than $0.1 million and $0.1 million of distributions, respectively, were made in respect of the MEMP incentive distribution rights. Please see Business Relationship with Memorial Production Partners LP for further information on our interest in MEMP. Table of Contents Index to Financial Statements
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in the common stock. You should carefully read the entire prospectus, including Risk Factors beginning on page 8, Management s Discussion and Analysis of Financial Condition and Results of Operations and the Financial Statements, before making an investment decision. Corporate Information Company Overview Fragmented Industry Exchange Inc. (formerly known as Ontarget Staffing Inc.) was incorporated in the State of Delaware as a for-profit Company on March 7, 2012 and established a fiscal year end of December 31. We are a development-stage financial acquisition intermediary which will serve buyers and sellers for companies that are in highly fragmented industries (i.e. industries in which there is no clear leader in market share). We plan to do this by developing a secure online, merger and acquisition (M&A) platform that matches buyers and sellers in specific industries ( Industry Exchanges ) and provide consulting and back office support services as discussed in greater detail below (collectively, the Business Services ). The Industry Exchanges will use a proprietary search algorithm, if completed, to automatically assess business buyers and sellers profiles, then match only relevant counterparties (the Algorithm ). We are currently in discussion with an outside third party developer who will be used to complete our Algorithm. Once finalized, the contract will include an arrangement with an independent contractor to perform all work needed to complete the project. As of the date of this prospectus, the development contract has not been signed. Development of the algorithm will commence once sufficient funds are available to provide a $5,000 down payment for the development contract. Currently, we anticipate requiring $25,000 to fund development of the algorithm. We expect to have an initial Algorithm completed by the 4th quarter of 2014. Until we complete our Algorithm, we will use Microsoft excel to track buyers and sellers and related profiles. The matching process will be done manually based upon the review of excel information. Certain factors used to match counterparties include: geographic location of the business, size of business, revenues, cash flow of business, asking price and availability of seller financing. Buyers and sellers responses for these (and other factors) will be input into excel spreadsheet and a manual comparison will conducted to determine whether any potential matches between buyers and sellers exist based on the criteria established. Upon determination of any matches, sellers are informed of potential buyers. Upon seller confirmation of interest in a potential buyer, we provide the contact information for such buyer. We are not involved in any transaction between the counterparties. We believe that by providing our industry-specific Business Services we can drive more revenue and expand our relationship with the Industry Exchange members. Whether a member consummates an M&A transaction with a counterparty member from the Industry Exchange or not, members might use our Business Services as part of their existing business. Initially, our Business Services will include assistance with; (i) revenue generation, more specifically, online marketing, and (ii) expense efficiencies, more specifically, accounting and financial support, insurance planning and human resource advisory. Furthermore, our Business Services will be marketed through a separate web portal from our Industry Exchanges. We believe that approach may allow us to attract other clients that are not actual members of the Industry Exchange. Until we generate enough revenue or raise additional capital, our CEO will deliver our Business Services. As of the date of this prospectus we have no Business Services clients. We intend to market these Business Services to companies in each of the industry specific sections. For example, we have already compiled a list of 10,220 US based staffing companies ( Target Customers ) with information that includes: company s name, estimated sales, # of employees, phone fax, contact at firm, title and address. We intend to market through a combination of methods including internet campaigns, search-engine optimization and direct marketing campaigns. The first Industry Exchange we have developed is for the staffing industry and have launched our two first industry-specific portal sites - www.staffingbizbuysell.com and www.staffingbizvalue.com (the Websites ) for the staffing industry. We currently have 3 seller members listed on this first exchange which is branded on the website as the Staffing Exchange. The Staffing Exchange is not a separate corporate entity rather it identifies the name of the specific Industry Exchange. Our first business portal site is branded on the web site as OnTarget360 , which is not a separate corporate entity. We are not currently providing Business Services for any of these clients. As we do not have any current Buyer members, we have only provided listing services for these members. Other fragmented industries for which we may develop similar exchanges and websites include: insurance, golf, hair and nail salons and plastics. We will create branded websites for each Industry Exchange created. Each Industry Exchange will also offer an Industry Forum where users can discuss their industry experiences and business best practices. Over time, we believe we can accumulate a significant knowledge base of industry information and develop and distribute proprietary content ( Industry Research ). Should revenues increase and/or financing be available, we may develop our own industry research group. No timeline or specific business plan has been developed to deliver Industry Research, however, we expect to be performing such work by the 1st calendar quarter of 2015. The Industry Research may be offered on a free basis for general information or as a subscription service for more detailed information and access to research specialists. We also intend to offer discussion forums where users of our website can exchange feedback, tips, social networking advice and ideas. Users will be required to register and provide their business name, activity, mailing and email address in order to be able to participate in our discussion forums. We may also offer incentives, to encourage users to provide us with more detailed business information like revenue, number of employees, and advertising spending. We may offer users the option to opt into promotional e-mails which we would then be able to send on a targeted basis on behalf of advertisers in order to increase our revenue opportunities We are an "emerging growth company" within the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with the requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. Following this offering, we will continue to be an emerging growth company until the earliest to occur of (1) the last day of the fiscal year during which we had total annual gross revenues of at least $1 billion (as indexed for inflation), (2) the last day of the fiscal year following the fifth anniversary of the date of our initial public offering under this prospectus, (3) the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible debt and (4) the date on which we are deemed to be a large accelerated filer, as defined under the Securities Exchange Act of 1934, as amended (which we refer to as the Exchange Act ). We also qualify as a smaller reporting company under Rule 12b-2 of the Securities Exchange Act of 1934, as amended, which is defined as a company with a public equity float of less than $75 million. To the extent that we remain a smaller reporting company at such time as are no longer an emerging growth company, we will still have reduced disclosure requirements for our public filings some of which are similar to those of an emerging growth company including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. Under U.S. federal securities legislation, our common stock will be "penny stock". Penny stock is any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a potential investor's account for transactions in penny stocks, and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve an investor's account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person, and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination. Brokers may be less willing to execute transactions in securities subject to the "penny stock" rules. This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock. Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. Our Revenue Model We expect to generate revenue primarily through; (i) membership fees from the Industry Exchanges; (ii) consulting fees from our Business Services, and, if launched (iv) subscription fees from our Industry Research. Since inception through December 31, 2013, we have generated $525 in revenue from three membership signups for our first Industry Exchange for the staffing industry which is called the Staffing Exchange. These membership signups related to three sellers. There are three levels of seller listings; (i) standard, which is free, (ii) featured, which includes a one time fee of $25 and then $10 per month, and (iii) showcased, which is $50 per month with a minimum quarterly up-front billing. Membership sign-ups for showcased listings require 90-day periods with fees billed on the date of sign-up and every 90 days thereafter, unless terminated. Standard and featured memberships are for 30-day periods and continue for successive 30-day periods unless terminated. Fees for these memberships are billed in advance. Memberships for any level may be terminated at anytime. However, notice of termination must be received at least 4-days prior to any renewal date or such membership will be billed and continue for subsequent periods (90 days for showcased and 30 days for standard and featured). On July 1, 2013, each of the Sellers signed up for a featured level of membership for $25 each and then on August 1, 2013 increased to a showcased listing membership and paid for the quarter upfront for $150 each. Due to the slower than expected build-out of our website and supporting back-end processing, we ceased charging membership fees in December 2013 and have allowed each member to maintain their listing free of charge. There is no assurance that we can produce any further revenue to cover our expenses, and, as such, an investor may lose all their investment. Buyers on the site may register for free. As of the date of this prospectus, no buyers have registered. The terms of our Business Services agreements would include client specific statement of work/responsibilities, compensation and payment schedules and term. Standard terms for all customers include: termination, indemnity and confidentiality provisions. These agreements will provide for termination by either party upon 30 days written notice. These agreements would terminate immediately upon notice of material breach (5-day cure period) or bankruptcy, insolvency, assignment for the benefit of creditors or appointment of receiver. Upon any termination, the client would be responsible for all accrued and unpaid fees due us. These agreements will also require the client to indemnify us against certain costs, expenses and losses incurred by us in the performance of our obligations under these agreements (except in instances of our willful default or gross negligence. We will agree to maintain confidentiality of all non-public, confidential and proprietary client information we receive during the course of our engagement. Our Industry Exchange revenue model will be similar to the online dating industry which consists of companies engaged in online matchmaking services. In the online dating industry, most companies generate revenue under a subscription model. Often, browsing will be free, but messaging or contacting other users will require a subscription. Alternatively, some websites generate revenue through advertising and are free for users. We plan to let buyers on the Industry Exchange register for free, while sellers will be required to pay for membership, at certain membership levels We also plan to generate revenue from allowing specific industry advertising by companies. We not a registered broker-dealer. We will not (i) provide advice about the merits of any particular transaction or the parties involved; (ii) participate in negotiations; (iii) assist buyers or sellers with completion of any transaction; (iv) handle funds or securities involved in completing a transaction and (v) hold itself out as providing any M&A transaction related services other than a listing or matching service. We will not receive a fee upon the successful sale of business other than the membership fees charged for listing on our website. Our Competition & Competitive Advantages There are currently a large number of websites providing business M&A services. To be successful, we believe that new entrants must have a differentiated offering. We believe new companies are challenged to recruit new users when they do not already have a substantial pool of existing users. As a result, marketing costs for new firms are disproportionately high. There is no assurance that we can produce sufficient revenue to cover our expenses, including such marketing costs, and, as such, an investor may lose all their investment. However, management believes that competitive advantages for our business plan will include: ease of searching and matching of buyers and sellers through our Algorithm; the interactive nature of our site provided by discussion forums; the proactive sending of information to users who register with our website to encourage repeat visits to our site; and our plans for providing supporting executive level consulting and back-office services. We continue to review and collect information on existing web sites that provide business merger and acquisition services. We have compiled a list of features that these web sites offer and intend to present the market with a comprehensive and user friendly website that provides more information, more current data, a larger set of features and a more user friendly interface than the majority of the existing sites. Such features, may include, but not be limited to, industry benchmarking surveys, job search links. Management expects to invest in ongoing development of the Algorithm, maintenance and expansion of the first Industry Exchange in order to remain competitive but believes the primary revenues will be driven by the success of our Business Services. The scope of the ongoing development of the Algorithm will be determined by the revenue generated and potentially by future financing opportunities. Our Corporate and Other Information We were incorporated in the State of Delaware in March 2012 as Ontarget Staffing, Inc., which name was changed to Fragmented Industry Exchange, Inc. in August 2013. Our fiscal year end December 31. Our principal office address is 80 Mountain Laurel Road, Fairfield, CT 06824 and our telephone is 203-344-7044. As of June 1, 2014, we had one employee, our president and chief executive officer Mrs. Mary Ellen Schloth. We are not a blank check corporation. Section 7(b)(3) of the Securities Act of 1933, as amended defines the term blank check company to mean, any development stage company that is issuing a penny stock that, (A) has no specific plan or purpose, or (B) has indicated that its business plan is to merge with an unidentified company or companies. We have a specific plan and purpose. Our business purpose is to create separate, industry specific, online web portals that act as a listing intermediary for sellers and buyers of companies in fragmented industry and provide industry specific business consulting and back office support We have not commenced operations nor have done any marketing, but have launched our two first industry-specific portal sites for the staffing industry - www.staffingbizbuysell.com known as The Staffing Exchange and www.staffingbizvalue.com known as OnTarget360 . Neither The Staffing Exchange nor OnTarget360 are separate corporate entities, rather they are specific names to brand each site. In Securities Act Release No. 6932 which adopted rules relating to blank check offerings, the Securities and Exchange Commission stated in II DISCUSSION OF THE RULES, A. Scope of Rule 419, that, Rule 419 does not apply to . . . start-up companies with specific business plans . . . even if operations have not commenced at the time of the offering. We have no present plans to be acquired or to merge with another company nor do we, nor any of our shareholders, have any plans to enter into a change of control or similar transaction. We may look to acquire complementary service providers and software product companies in the future to grow our operations. Summary of the Offering by the Company Common Stock offered by the Company 1,000,000 shares (the Company Shares ) Common Stock offered by selling shareholders 611,000 shares ( the Selling Shareholders Shares ) Total Common Stock offered 1,611,000 per share of Common Stock. Number of shares outstanding before the offering 4,132,000 shares of Common Stock. Number of shares outstanding assuming all shares are sold 5,132,000 shares of Common Stock will be issued and outstanding after this offering is completed. Minimum number of Company Shares to be sold None. Market for the common shares There is no public market for the common shares. The price per share of Common Stock is $0.12. We may not be able to meet the requirement for a public listing or quotation of its common stock. Further, even if our common stock is quoted or granted listing, a market for the common shares may not develop. Use of proceeds The Company will receive all proceeds from the sale of the Company Shares. If all 1,000,000 Company Shares being offered are sold, the total gross proceeds to the Company would be $120,000. Counsel to the Company has agreed to defer a portion of its costs for services rendered through the effective date of the registration statement, which fees are currently estimated at $30,000. The first proceeds raised will be used to pay any outstanding legal fees relating to this prospectus. The Company intends to use the remaining proceeds from this offering, as follows: (i) software programming and further developments of our websites for the staffing industry www.staffingbizbuysell.com known as The Staffing Exchange and www.staffingbizvalue.com known as OnTarget360 (the Websites ), estimated at $40,000 (ii) to pay post-offering legal, accounting and expenses estimated at $20,000, (iii) sales and marketing, estimated at $12,000, and (iv) rent, phone, administrative & operating support expenses, estimated at $18,000. The expenses of this offering, including the preparation of this prospectus and the filing of this registration statement, estimated at approximately $30,000 are being paid for by us from cash on hand. The information on, or that may be, accessed from our Websites is not part of this Prospectus. The Company will receive no proceeds from the sale of the Selling Shareholders Shares. Termination of the offering The offering for Company Shares will conclude upon the earlier of (i) the date on which all 1,000,000 shares of Company Shares have been sold, or (ii) 180 days after the date on which the registration statement filed with the Securities and Exchange Commission is effective. The Company at its discretion may extend the offering for an additional 90 days. Terms of the offering The Company s President will sell the Company Shares at a price of $0.12 per share upon effectiveness of this Registration Statement on a best-efforts basis. The selling shareholders will determine when and how they will sell the common stock offered in this prospectus. The 611,000 shares of our common stock can be sold by selling shareholders at a fixed price of $0.12 per share until our shares are quoted on the OTCBB or the OTC Markets and thereafter at prevailing market prices or privately negotiated prices. There can be no assurance that a market maker will agree to file the necessary documents with the Financial Industry Regulatory Authority ( FINRA ), nor can there be any assurance that such an application for quotation will be approved. You should rely only upon the information contained in this prospectus. We have not authorized anyone to provide you with information different from which is contained in this prospectus. The Company is offering to sell shares of common stock and seeking offers only in jurisdictions where offers and sales are permitted. The information contained in here is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the common stock. Summary of Financial Information The following summary financial information for the periods stated summarizes certain information from our financial statements included elsewhere in this prospectus. You should read this information in conjunction with Management's Plan of Operations, the financial statements and the related notes thereto included elsewhere in this prospectus. Balance Sheet As of December 31, 2013 As of March 31, 2014 Total Assets $ 556 $ 1,444 Total Liabilities $ 25,181 $ 67,295 Stockholder s Deficit $ (24,625 ) $ (65,851 ) Operating Data March 7, 2012 (Date of Inception) to December 31, 2013 Three Months Ended March 31, 2014 Revenue $ 525 $ -- Net Loss $ (82,975 ) $ (49,476 ) Net Loss Per Share $ (0.02 ) $ (0.01 )
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001600750_medrespons_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001600750_medrespons_prospectus_summary.txt
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+PART I SUMMARY This summary provides a brief overview of the key aspects of our offering. It may not contain all of the information that is important to you. You should read the entire prospectus carefully, including the more detailed information regarding our company, the risks of purchasing our common stock discussed under "Risk Factors," and our financial statements and their accompanying notes. In this prospectus, "Merecot", "the Company," "we," "us," and "our," refer to Merecot Corp., unless the context otherwise requires. Unless otherwise indicated, the term "fiscal year" refers to our fiscal year ending December 31. Unless otherwise indicated, the term "common stock" refers to shares of the Company's common stock, par value $0.001 per share. THE COMPANY Merecot Corp. was incorporated in the State of Nevada on June 21, 2013. Our offices are located at 6 Corporate Way, Suite 2-6621, Valley Cottage, NY 10989. We are a development stage company with nominal revenue earned to date and minimum operations and assets. Since our incorporation, our management has determined our business plan to create automated supply chain Web Services to the SPA and Wellness industry, identified our target market and obtained initial funding of $10,000 from our sole director. We will require additional funding in order to pursue our business objectives and there is no guarantee that we will be successful in this regard. Our plan of operation is to design, develop, and run Web Services that will connect manufacturers and distributors of the SPA products and equipment with individual SPA and Wellness outlets. The Web Services will perform multiple business functions including automated inventory control, delivery scheduling, introduction of the new products and equipment. We will need to complete our offering in order to cover an estimated $8,000 in federal securities law compliance costs which includes $5,000 in accounting and auditing costs for the 12 month period following the effectiveness of our registration statement. Currently, our President devotes approximately ten hours a week to the Company. We will require the funds from this offering in order to fully implement our business plan as discussed in the "Plan of Operation" section of this prospectus. Our financial statements from inception (June 21, 2013) through March 31, 2014 report nominal revenue and a net loss of ($6,240) and our assets and our cash balance of $4,788 which was generated from our sale of 5,000,000 shares purchased by our president and director and loans from our president and director. We anticipate incurring average quarterly operational costs of about $6,250 until our offering is completed. Investors should be aware that our independent auditors have issued an audit opinion which includes a statement expressing substantial doubt as to our ability to continue as a going concern. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next 12 months. Our auditor's opinion is based on our suffering initial losses, having limited operations, and having limited working capital. Our only source for cash at this time is investments or loans by others in our Company. However, we do not have any written agreements in place for any investments or loans from third parties. We must raise cash to implement our projects and expand our operations. Investors must be aware that we do not have sufficient capital to independently finance our own plans. We have no plans, arrangements or contingencies in place in the event that we cease operations, in which case investors would lose their entire investment. THE OFFERING We are offering, on a self-underwritten basis, a total of 10,000,000 shares of the common stock of our Company at a price of $0.01 per share. This is a fixed price offering. In order to close the Offering all of the offered shares must be sold. This Offering of shares by our Company will terminate 180 days from the effective date of this Prospectus, although we may close the Offering on any date prior if the Offering is fully subscribed. The offering price of the common stock has been arbitrarily determined and bears no relationship to any objective criterion of value. The price does not bear any relationship to our assets, book value, historical earnings or net worth. There is no minimum offering of the Merecot shares and investors will not receive a return of their investment if all shares are not sold. The purchase of the common stock in this offering involves a high degree of risk. The common stock offered in this Prospectus is for investment purposes only and currently no market for our common stock exists. Please refer to "RISK FACTORS" and "DILUTION" sections before making an investment in our stock. Securities Being Offered 10,000,000 shares of common stock. Offering Price $0.01 per share Offering Period The shares are being offered for a period not to exceed 180 days from the effective date of this Prospectus. Number of Common Stock Issued and Outstanding Before Offering 5,000,000, all of which are held by our president. Number of Common Stock to be Issued and Outstanding After Offering 15,000,000 shares Net Gross Proceeds to Our Company $100,000 Use of Proceeds We intend to use the proceeds to develop our business operations. Risk Factors The securities offered hereby involve a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See "Risk Factors" section. Going Concern From inception until the date of this filing, we have had very limited operating activities. Our financial statements from inception (June 21, 2013) through December 31, 2013, report only nominal revenue and a net loss of ($3,166). Our independent registered public accounting firm has issued an audit opinion for Merecot which includes an explanatory paragraph as to an uncertainty with respect to the Company's ability to continue as a going concern. Our sole officer, director, control person and/or her affiliates do not intend to purchase any shares in this offering.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001600774_triumph_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001600774_triumph_prospectus_summary.txt
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+Prospectus Summary 5
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001600784_american_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001600784_american_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..9a52d05e0811529f86fe436873e01680395414e2
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+PROSPECTUS SUMMARY THIS SUMMARY HIGHLIGHTS INFORMATION CONTAINED ELSEWHERE IN THIS PROSPECTUS. YOU SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY, INCLUDING THE DETAILED INFORMATION CONTAINED UNDER THE HEADING "RISK FACTORS," THE FINANCIAL STATEMENTS AND THE ACCOMPANYING NOTES TO THOSE FINANCIAL STATEMENTS INCLUDED ELSEWHERE IN THIS PROSPECTUS. The Company American Gene Engineer Corp. ("Company") was incorporated in the State of Delaware on November 15, 2010. The Company has been in the developmental stage since inception and has conducted virtually no business operations. The Company has no full-time employees and owns no real estate or personal property. The Company was formed as a vehicle to pursue a business combination with an existing entity in the field of genetic testing and has made no efforts to identify a possible business combination. As a result, the Company has not conducted negotiations or entered into a letter of intent concerning any target business. The business purpose of the Company is to seek the acquisition of, or merger with, an existing company which provides genetic testing and diagnostic services. We have a minimal amount of cash. The Independent Auditor s Report to our financial statements for the fiscal year ended October 31, 2013, included in this prospectus, indicates that there are a number of factors that raise substantial doubt about our ability to continue as a going concern. Such doubts identified in the report include the fact (i) that we have not established any source of revenue to cover our operating costs; (ii) that we will engage in very limited activities without incurring any liabilities that must be satisfied in cash until a source of funding is secured; and (iii) that if we are unable to obtain revenue producing contracts or financing or if the revenue or financing we do obtain is insufficient to cover any operating losses we may incur, we may substantially curtail or terminate our operations. The Company, based on our proposed business activities, is a blank check company. The U.S. Securities and Exchange Commission ( SEC ) defines those companies as "any development stage company that is issuing a penny stock, within the meaning of Section 3(a)(51) of the Exchange Act of 1934, as amended ( Exchange Act ) and that has no specific business plan or purpose, or has indicated that its business plan is to merge with an unidentified company or companies". Under Rule 12b-2 promulgated under the Exchange Act, the Company will be deemed to be a shell company, because it has no or nominal assets (other than cash) and no or nominal operations. Many states have enacted statutes, rules and regulations limiting the sale of securities of blank check companies in their respective jurisdictions. Management does not intend to undertake any efforts to cause a market to develop in our securities, either debt or equity, until we have successfully concluded a business combination. The Company intends to comply with the periodic reporting requirements of the Exchange Act for so long as we are subject to those requirements. The Company was organized to provide a method for a foreign or domestic privately held company to become a reporting company whose securities are qualified for trading in the United States securities markets, such as the New York Stock Exchange ( NYSE ), NASDAQ, American Stock Exchange ( AMEX ) or the OTC Bulletin Board, and, as a vehicle to investigate and, if such investigation warrants, acquire a target company or business seeking the perceived advantages of being a publicly held reporting company. The Company s principal business objective for the next 12 months and beyond will be to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings. The Company will not restrict its potential candidate target companies to any specific industry or geographical location and, thus, may acquire or merge with any type of business, domestic or foreign. Our principal executive offices are located at 521 Fifth Avenue, Suite 1712, New York, New York 10175 and our telephone number at that address is (212) 292-4231 and (212) 292-4595. If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. o Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer, and smaller reporting company in Rule 12b-2 of the Exchange Act. (check one): Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company x (do not check if a smaller reporting company) CALCULATION OF REGISTRATION FEE Proposed Proposed maximum maximum Title of each class of Amount to be offering price aggregate Amount of securities to be registered registered (1) per unit(2) offering price registration fee Common Stock 100,000,000 $ 0.001 $ 100,000 $ 12.88 (1) In the event of a stock split, stock dividend, or similar transaction involving the common stock, the number of shares registered shall automatically be increased to cover the additional shares of common stock issuable pursuant to Rule 416 under the Securities Act of 1933, as amended. (2) Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(o) under the Securities Act of 1933. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents The Offering Securities Being Offered: Up to 100,000,000 shares of common stock. Initial Offering Price: The selling stockholders will sell our shares at $0.001 per share until our shares are quoted on the OTC Bulletin Board or Pink Sheets and thereafter at prevailing market prices or privately negotiated prices. This price was arbitrarily determined by our board of directors and may not be indicative of the real value of a share of our common stock. Terms of the Offering: The selling stockholders will determine when and how they will sell their common stock offered in this prospectus. Termination of the Offering The offering will conclude when all of the 100,000,000 shares of common stock have been sold or we, in our sole discretion, decide to terminate the registration of the shares. We may decide to terminate the registration if it is no longer necessary due to the operation of the resale provisions of Rule 144 promulgated under the Securities Act of 1933. We also may terminate the offering for no reason whatsoever.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001600989_goldmerx_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001600989_goldmerx_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..229abfcdd87d5fda56832282f97879920ebe1257
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+Prospectus Summary 3
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001601199_k2-design_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001601199_k2-design_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8373709e6e5bd7215dcb50b81c74abf37806eefa
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+Prospectus Summary The following summary is a shortened version of more detailed information, exhibits and financial statements appearing elsewhere in this prospectus. Prospective investors are urged to read this prospectus in its entirety. To date, K2 has not conducted any business operations nor generated any revenues. K2 Design & Strategy, Inc. (the "Company") was incorporated in the State of Delaware on February 14, 2014. The Company is a development stage company that intends to operate as an advanced analytics software and services company. To date, the Company s activities have been limited to its formation and the raising of equity capital. K2 plans to use the proceeds it raises from its offering to develop its business and products, establish relationships, hire and train personnel, market its business, and sell its products. K2 will not receive the entire $70,000,000 in gross proceeds unless the maximum number of shares is sold. Rather, after expenses of approximately $50,000, K2 will receive $6,950,000 if 10% of the total offering is sold, $17,450,000 if 25% of the total offering is sold, $52,450,000 if 75% of the total offering is sold, and $69,950,000 if 100% of the total offering is sold. K2 has no revenues, has achieved losses since inception, has no operations, has been issued a going concern opinion by its auditor and relies upon the sale of its shares of common stock to fund its operations. We are not a "blank check" company, as that term is defined in Section 7(b)(3) of the Securities Act of 1933, as amended. K2 has a specific business plan and has no present plans to be acquired or to merge with another company, nor do we, nor any of our shareholders, have plans to enter into a change of control or similar transaction. We are seeking to become a reporting issuer under the Securities Exchange Act of 1934, as amended, because we believe that this will provide us with greater access to capital, that we will become better known, and be able to obtain financing more easily in the future if investor interest in our business grows enough to sustain a secondary trading market in our securities. Additionally, we believe that being a reporting issuer increases our credibility and that we may be able to attract and retain more highly qualified personnel once we are not a shell company by potentially offering stock options, bonuses, or other incentives with a known market value. The Offering The following is a brief summary of this offering. Securities being offered to new and current investors: Up to a maximum of 10,000,000 shares of common stock with no minimum purchase. Offering price: $7.00 Offering period: The shares are being offered until December 31, 2014. Net proceeds and use: Net proceeds if 10% of the total offering is sold: $6,950,000 ($7,000,000 less estimated offering costs of $50,000). With a minimum subscription rate of 10% K2 plans on the following: Activities for months 1 through 6: Selection of locations and facilities for K2 s plan of operation, including office locations and software development center. Design, architect, and develop each facility to accommodate operational requirements for each office location. Activities for months 1 through 9: Recruitment and selection of engineers, programmers, designers, developers, operations, support, sales, marketing, leadership, and human resources specialists. On boarding process including human resource requirements, technology requirements, training needs, organizational requirements, and logistics. Designing, architecting, procuring, and building of corporate information technology infrastructure. Designing, architecting, procuring, and building of systems required for product development. Procuring and deploying employee technologies such as laptops, software, and communications systems. Activities for months 1 through 12: Design and development of website, branding strategy, marketing materials, strategic media, and strategic communications plan. Initiate business development, marketing, and sales plan. Initiate planning with prospective development partners and prospective future services partners. Launch K2 s consulting practices for custom digital intelligence and custom digital experience solutions. Launch K2 s executive consulting practice specializing in optimal business performance. Activities for all of months 3 through 12: Design, architect, and begin development of first major release of digital intelligence software product. Prototype and beta test first major release of digital intelligence software product. The activities listed above per a minimum subscription rate of 10% are estimated to begin generating revenue within 3 to 6 months of K2 s commencement of operations. These activities are expected to streamline the design, strategy, and development of K2 s planned digital intelligence software, and digital experience solutions. Net proceeds if 25% of the total offering is sold: $17,450,000 ($17,500,000 less estimated offering costs of $50,000). With a minimum subscription rate of 25% K2 plans on the following in addition to activities listed above: Activities for months 1 through 9: Design and build K2 s executive briefing and digital experience design center. Utilize executive briefing and digital experience design center to facilitate and accelerate all prospective major practice areas; custom digital intelligence solutions, custom digital experience solutions, and prototypes of planned digital intelligence software. The activities listed above per a minimum subscription rate of 25% are estimated to begin generating revenue within 6 to 9 months of commencement of operations. These activities are expected to inform and streamline the design, strategy, and development of K2 s planned digital intelligence software, and digital experience solutions. Net proceeds if 50 % of the total offering is sold: $34,950,000 ($35,000,000, less estimated offering costs of $50,000). With a minimum subscription rate of 50% K2 plans on the following in addition to activities listed above: Activities for months 6 through 12: Launch K2 s digital innovation practice, specializing in individual consumer technologies based on digital intelligence, digital experience, and optimal performance for high stakes individuals. Build digital innovation lab, specializing in individual consumer technologies based on digital intelligence, digital experience, and optimal performance for high stakes individuals. The activities listed above per a minimum subscription rate of 50% are estimated to begin generating revenue within 12 to 15 months of commencement of operations. These activities are expected to inform and streamline the design, strategy, and development of K2 s planned digital intelligence software, and digital experience solutions. Net proceeds if 100% of offering is sold: Up to a maximum of $69,950,000 ($70,000,000, less estimated offering costs of $50,000). With a subscription rate of 100%, K2 plans on the following in addition to activities listed above: With a subscription rate of 100%, K2 plans to accelerate its time to market by accelerating its plan for recruiting and on boarding talent for its digital intelligence software and digital experience solutions teams. (table of contents) Summary Financial Information The tables and information below are derived from K2 s audited financial statements from inception (February 14, 2014) to July 31 , 2014. K2 Design & Strategy, Inc. (A Development Stage Company) BALANCE SHEET JULY 31, 2014 ASSETS CURRENT ASSETS Cash $ 33,132 Deferred loan fees, net of accumulated amortization of $5,304 6,796 Total current assets 39,928 TOTAL ASSETS $ 39,928 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT LIABILITIES Accrued expenses $ 6,402 Promissory note payable 70,000 Total current liabilities 76,402 TOTAL LIABILITIES 76,402 STOCKHOLDERS' DEFICIT Preferred stock, $0.0001 par value, 10,000,000 shares authorized, no shares issued and outstanding — Common stock, $0.0001 par value, 100,000,000 shares authorized, 25,249,722 shares issued and outstanding 2,525 Additional paid-in capital 130,871 Stock subscription recievable (1,675 ) Deficit accumulated during development stage (168,195 ) Total stockholders' deficit (36,474 ) TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 39,928 (table of contents) K2 Design & Strategy, Inc. (A Development Stage Company) STATEMENT OF OPERATIONS FOR THE PERIOD FROM INCEPTION (FEBRUARY 14, 2014) TO JULY 31, 2014 REVENUE $ — OPERATING EXPENSES General and administrative 159,632 Total operating expenses 159,632 OTHER EXPENSES: Interest 3,259 Amortization 5,304 8,563 Loss before income taxes (168,195 ) Income tax provision — NET LOSS $ (168,195 ) Weighted average number of shares outstanding - basic and diluted 19,355,505 Loss per share - basic and diluted $ (0.01 ) The accompanying notes are an integral part of these consolidated financial statements. (table of contents)
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001601347_pilgrim_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001601347_pilgrim_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..3469972635ec75c283a6edb01754aca4ca27e399
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+Table of Contents PROSPECTUS (Proposed Holding Company for Pilgrim Bank) Up to 1,897,500 Shares of Common Stock Pilgrim Bancshares, Inc., a Maryland corporation, is offering shares of common stock for sale in connection with the conversion of Conahasset Bancshares, MHC from the mutual to the stock form of organization. All shares of common stock are being offered for sale at a price of $10.00 per share. We expect that our common stock will be quoted on the OTC Pink Marketplace operated by OTC Markets Group, Inc. upon conclusion of the offering. There is currently no public market for the shares of our common stock. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012. We are offering up to 1,897,500 shares of common stock for sale on a best efforts basis. We may sell up to 2,182,125 shares of common stock because of demand for the shares or changes in market conditions without resoliciting subscribers. We must sell a minimum of 1,402,500 shares in order to complete the offering. We are offering the shares of common stock in a subscription offering. Shares of common stock not purchased in the subscription offering may be offered for sale to the general public in a community offering. We also may offer for sale shares of common stock not purchased in the subscription offering or community offering through a syndicated community offering to be managed by Keefe, Bruyette & Woods, Inc. In addition to the shares that we will sell in the offering, we will also contribute a total of $725,000 to a charitable foundation that we are establishing, such contribution to consist of a number of shares of our common stock equal to 3.0% of the shares sold in the offering (42,075 shares or $420,750 in stock at the minimum offering and 56,925 shares or $569,250 in stock at the maximum offering, or up to 65,464 shares or $654,640 in stock at the adjusted maximum offering) and the remainder in cash ($304,250 at the minimum offering and $155,750 at the maximum offering, or $70,360 at the adjusted maximum). The minimum number of shares of common stock you may order is 25 shares. The maximum number of shares of common stock that an individual can order by himself in the subscription offering is 20,000 shares, and the maximum number of shares of common stock that an individual with an associate or group of persons acting in concert in all categories of the offering can order is 30,000 shares. Stock orders must be received by us before 2:00 p.m., Eastern Time, on [expiration date]. Orders received after 2:00 p.m., Eastern Time, on [expiration date] will be rejected unless we extend this expiration date. We may extend this expiration date without notice to you until [extension date], or such later date as the Federal Reserve Board may approve, to the extent such approval is required, which may not be beyond February 25, 2016. Once submitted, orders are irrevocable. However, if the offering is extended beyond [extension date], or the number of shares of common stock to be sold is increased to more than 2,182,125 shares or decreased to fewer than 1,402,500 shares, we will resolicit subscribers, giving them an opportunity to confirm, change or cancel their orders. Funds received during the offering will be held in a segregated account at Pilgrim Bank, and will earn interest at 0.20% per annum, which is our current statement savings rate. Keefe, Bruyette & Woods will assist us in selling our shares of common stock on a best efforts basis. Keefe, Bruyette & Woods is not required to purchase any shares of the common stock that are being offered for sale. Purchasers will not pay a commission to purchase shares of common stock in the offering. Keefe, Bruyette & Woods has advised us that it intends to make a market in the common stock, but is under no obligation to do so. Upon completion of the conversion, Pilgrim Bancshares, Inc. will be a bank holding company registered with the Federal Reserve Board, and will be subject to regulations, inspections, supervision and reporting requirements of the Federal Reserve Board. See Supervision and Regulation for more information. This investment involves a degree of risk, including the possible loss of your investment. Please read Risk Factors beginning on page 22. OFFERING SUMMARY Price: $10.00 per Share Minimum Midpoint Maximum Adjusted Maximum Number of shares 1,402,500 1,650,000 1,897,500 2,182,125 Gross offering proceeds $ 14,025,000 $ 16,500,000 $ 18,975,000 $ 21,821,250 Estimated offering expenses (excluding selling agent fees) $ 1,065,000 $ 1,065,000 $ 1,065,000 $ 1,065,000 Estimated selling agent fees(1) (2) $ 335,000 $ 335,000 $ 335,000 $ 335,000 Estimated net proceeds $ 12,625,000 $ 15,100,000 $ 17,575,000 $ 20,421,250 Estimated net proceeds per share $ 9.00 $ 9.15 $ 9.26 $ 9.36 (1) See The Conversion and Plan of Distribution Marketing and Distribution; Compensation for a discussion of Keefe, Bruyette & Woods compensation for the offering. (2) Selling agent commissions shown assume that all shares are sold in the subscription offering. The amounts shown include (i) fees and selling commissions payable by us to Keefe, Bruyette & Woods in connection with the subscription offering equal to 1.0% of the aggregate purchase price of shares sold in the subscription offering (excluding shares purchased by officers, directors, employees, and our employee stock ownership plan, for which no selling agent commissions would be paid), subject to a minimum fee of $225,000; and (ii) other expenses of the offering payable to Keefe, Bruyette & Woods equal to $110,000. If all shares of common stock are sold in the syndicated community offering, selling agent commissions would be 6.0% of the aggregate purchase price of shares sold in the offering (excluding shares purchased by directors, officers, employees and our employee stock ownership plan), and the maximum selling agent commissions and expenses would be $830,440 at the minimum, $966,704 at the midpoint, $1,102,968 at the maximum and $1,259,671 at the maximum, as adjusted. See The Conversion and Plan of Distribution Marketing and Distribution; Compensation for a discussion of fees to be paid to Keefe, Bruyette & Woods and other FINRA member firms in the event that all shares are sold in a syndicated community offering. These securities are not deposits or accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation, the Share Insurance Fund, or any other government agency. Neither the Securities and Exchange Commission, the Board of Governors of the Federal Reserve System, the Massachusetts Commissioner of Banks, the Federal Deposit Insurance Corporation, nor any state securities regulator has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. For assistance, please call the Stock Information Center, toll free, at [ ]. KEEFE, BRUYETTE & WOODS A Stifel Company The date of this prospectus is [ ], 2014. Table of Contents SUMMARY The following summary explains the significant aspects of the mutual-to-stock conversion of Conahasset Bancshares, MHC and the related offering of Pilgrim Bancshares, Inc. common stock. It may not contain all of the information that is important to you. For additional information before making an investment decision, you should read this entire document carefully, including the
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+This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before investing in our common units. You should read the entire prospectus carefully, including the historical financial statements and the notes to those financial statements, before investing in our common units. The information presented in this prospectus assumes, unless otherwise indicated, that the underwriters option to purchase additional common units is not exercised. You should read Risk Factors for information about important risks that you should consider before buying our common units. References in this prospectus to Viper Energy Partners LP Predecessor, our predecessor, we, our, us or like terms when used in a historical context refer to Viper Energy Partners LLC, which Diamondback Energy, Inc. (NasdaqGS: FANG) contributed to Viper Energy Partners LP in connection with Viper Energy Partners LP s initial public offering (the IPO ) on June 23, 2014. When used in the present tense or prospectively, we, our, us or like terms refer to Viper Energy Partners LP and its subsidiaries. Except where expressly noted otherwise, references in this prospectus to Diamondback refer to Diamondback Energy, Inc. and its subsidiaries other than Viper Energy Partners LP and its subsidiaries. References in this prospectus to our general partner refer to Viper Energy Partners GP LLC, a wholly owned subsidiary of Diamondback Energy, Inc. References in this prospectus to Wexford refer to Wexford Capital LP, which is a Greenwich, Connecticut-based SEC-registered investment advisor with approximately $4.0 billion under management as of June 30, 2014. References in this prospectus to our executive officers and our directors refer to the executive officers and directors of our general partner, respectively. We include a glossary of some of the terms used in this prospectus as Appendix A. Viper Energy Partners LP
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+PROSPECTUS SUMMARY 4
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001603286_dominion_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001603286_dominion_prospectus_summary.txt
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+This summary highlights information contained elsewhere in this prospectus. You should read the entire prospectus carefully, including the historical and pro forma financial statements and the notes to those financial statements, before investing in our common units. The information presented in this prospectus assumes an initial public offering price of $20.00 per common unit (the mid-point of the price range set forth on the cover page of this prospectus) and, unless otherwise indicated, that the underwriters option to purchase additional common units is not exercised. You should read Risk Factors for information about important risks that you should consider before buying our common units. References in this prospectus to Cove Point, the Predecessor, our predecessor, and we, our, us, our partnership or like terms when used in a historical context refer to Dominion Cove Point LNG, LP, which is our predecessor for accounting purposes, and when used in the present tense or prospectively, Dominion Midstream, we, our, us or like terms refer to Dominion Midstream Partners, LP and its wholly-owned subsidiary, Cove Point GP Holding Company, LLC. Unless the context otherwise requires, references in this prospectus to Dominion refer collectively to Dominion Resources, Inc. and its subsidiaries, other than us and Cove Point. We include a glossary of some of the terms used in this prospectus as Appendix C. Dominion Midstream Partners, LP
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+Prospectus Summary 1
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+SUMMARY OF PROSPECTUS You should read the following summary together with the more detailed business information, financial statements and related notes that appear elsewhere in this Prospectus. In this Prospectus, unless the context otherwise denotes, references to "we," "us," "our", "Tixfi", and "Company" are to Tixfi Inc. A Cautionary Note on Forward-Looking Statements This Prospectus contains forward-looking statements, which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors," that may cause our industry's actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
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+elsewhere in this prospectus. Capitalized terms used but not defined in this summary are defined in this prospectus. Investors should consider this prospectus in its entirety, including the information referred to under Management s Discussion and Analysis of Financial Condition and Results of Operations and Risk Factors, and the financial statements included elsewhere herein, prior to making an investment in our ADS. The basis of certain information in this prospectus regarding industry share and our position relative to our competitors is described under Industry, Ranking and Other Data. In this prospectus, unless the context indicates otherwise, the term Company refers (i) as of any time prior to the conversion to a German stock corporation as described below, to Orion Engineered Carbons Holdings GmbH and (ii) as of any time after the conversion, to Orion Engineered Carbons Holdings AG and the terms Orion, we, our, us and the Group refer to the Company and its consolidated subsidiaries. Our fiscal year is a calendar year. Overview We are a leading global producer of carbon black headquartered in Germany. Carbon black is a form of carbon used to improve certain properties of materials into which it is added. It is used as a pigment and as a performance additive in coatings, polymers, printing and special applications (specialty carbon black) and in the reinforcement of rubber in tires and mechanical rubber goods (rubber carbon black). Historically, our business operated as a business line of Evonik and was acquired from Evonik on July 29, 2011 (the Acquisition ) by investment funds managed by affiliates of Rh ne Capital L.L.C. (the Rh ne Investors ) and investment funds managed by an affiliate of Triton Managers III Limited and TFF III Limited (the Triton Investors ). Prior to the Acquisition, the Company had no substantive operations. In 2013, we generated revenue of 1,339.6 million on sales volume of 968.3 kilo metric tons ( kmt ), Adjusted EBITDA of 191.1 million and a loss for the period of 18.9 million. We operate a diversified carbon black business with more than 280 specialty carbon black grades and approximately 70 rubber carbon black grades. Our product portfolio is one of the broadest in the industry and is divided into the following segments: Specialty Carbon Black. We are one of the largest global producers of specialty carbon black with an estimated share of global industry sales of approximately 24% in 2013 measured by volume in kmt. We believe that our share of global industry sales measured by revenue is higher, since our product portfolio is weighted towards higher priced premium grades. We manufacture specialty carbon black at multiple sites for a broad range of specialized applications. Specialty carbon black imparts specific characteristics, such as high-quality pigmentation, ultraviolet ( UV ) light protection, viscosity control and electrical conductivity. In 2013, Adjusted EBITDA for our Specialty Carbon Black segment was 98.0 million and the Segment Adjusted EBITDA Margin was 25.1%. This segment accounted for 29.1% of our total revenue, 51.3% of our total Adjusted EBITDA and 19.7% of our sales volume in kmt in 2013. Rubber Carbon Black. We are one of the largest global producers of rubber carbon black. We have a global supply network and an estimated share of global industry sales of approximately 7% in 2013 measured by volume in kmt, with industry sales shares by volume equal to or exceeding 15% in each of our major operating regions. In 2013, Adjusted EBITDA for our Rubber Carbon Black segment was 93.2 million and Segment Adjusted EBITDA Margin was 9.8%. This segment accounted for 70.9% of our total revenue, 48.7% of our total Adjusted EBITDA and 80.3% of our total sales volume in kmt in 2013. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We and the Selling Shareholder identified in this preliminary prospectus may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any jurisdiction where such offer or sale is not permitted. PROSPECTUS (Subject to Completion) Dated April 21, 2014 ORION ENGINEERED CARBONS HOLDINGS GMBH AMERICAN DEPOSITARY SHARES REPRESENTING ORDINARY SHARES Orion Engineered Carbons Holdings GmbH (the Company ) is offering American Depositary Shares ( ADS ) and Kinove Luxembourg Holdings 2 S. r.l. (the Selling Shareholder ) is offering ADS. Each ADS will represent ordinary shares of the Company with a notional value of 1.00. The Company will not receive any proceeds from the sale of the ADS by the Selling Shareholder. This is our initial public offering and no public market exists for our ADS or ordinary shares. We anticipate that the initial public offering price will be between $ and per ADS. We intend to apply to list the ADS on the New York Stock Exchange (the NYSE ) under the symbol . Investing in the ADS involves risks. See Risk Factors beginning on page 16. Price to Public Underwriting Discounts and Commissions Proceeds, before Expenses, to Company(1) Proceeds, before Expenses, to Selling Shareholder Per ADS $ $ $ $ Total $ $ $ $ (1) We have agreed to reimburse the underwriters for certain FINRA-related expenses. See Underwriting. The Selling Shareholder has granted the underwriters the right to purchase up to an additional ADS at the initial public offering price less the underwriting discount. The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the ADS to purchasers on , 2014. MORGAN STANLEY GOLDMAN, SACHS & CO. UBS INVESTMENT BANK , 2014 Table of Contents NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains and refers to certain forward-looking statements with respect to our financial condition, results of operations and business. Forward-looking statements are statements of future expectations that are based on management s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among others, statements concerning the potential exposure to market risks and statements expressing management s expectations, beliefs, estimates, forecasts, projections and assumptions. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are typically identified by words such as anticipate, believe, could, estimate, expect, intend, may, plan, objectives, outlook, probably, project, will, seek, target and other words of similar meaning. These forward-looking statements include, without limitation, statements about the following matters: our strategies for (i) strengthening our position in specialty carbon blacks and rubber carbon blacks, (ii) increasing our rubber carbon black margins and (iii) strengthening the competitiveness of our operations; the proposed acquisition of QECC (as defined below); the outcome of any pending or possible litigation or regulatory proceedings; and our expectation that the markets we serve will continue to grow. All these forward-looking statements are based on estimates and assumptions that, although believed to be reasonable, are inherently uncertain. Therefore, undue reliance should not be placed upon any forward-looking statements. There are important factors that could cause actual results to differ materially from those contemplated by such forward-looking statements. These factors include, among others: negative or uncertain worldwide economic conditions; volatility and cyclicality in the industries in which we operate; operational risks inherent in chemicals manufacturing, including disruptions as a result of severe weather conditions and natural disasters; our dependence on major customers; our ability to compete in the industries in which we operate; our ability to develop new products and technologies successfully and the availability of substitutes for carbon black; our ability to implement our business strategies; volatility in the costs and availability of raw materials and energy; our ability to realize benefits from investments, joint ventures, acquisitions or alliances; information technology systems failures, network disruptions and breaches of data security; Table of Contents We have over 75 years of experience and enjoy a long-standing reputation for technical capability in the carbon black industry and its served applications. Our experience has enabled us to develop our core competencies and proprietary technologies across the carbon black value chain. We provide consistent product quality, reliability, technical expertise and innovation, built upon continually improving processes and know-how through our advanced Innovation Group, which includes our research and development ( R&D ), applications technology and process development teams, and through supply chain execution. Our Innovation Group works closely with our customers to develop innovative products and applications, while strengthening customer relationships and improving communication. Long-term R&D alliances and sophisticated technical interfaces with customers allow us to develop solutions to meet specific customer requirements. As a result, we have been able to generate attractive margins for our specialized carbon black products. Additionally, our Innovation Group works closely with our operations group to improve process economics with new process equipment designs, operating techniques and raw material selection. We operate a modern global supply chain network comprising 13 wholly owned production plants and one jointly-owned production plant. We are currently seeking to acquire the Chinese carbon black manufacturer Qingdao Evonik Chemicals Co. Ltd. ( QECC ), which accounted for approximately 65 kmt in sales volume in 2013, and in which Evonik has a majority interest. The acquisition is subject to ongoing Chinese government review and negotiations with Evonik and between Evonik and its joint venture partner. We believe that this acquisition, if completed, would improve our ability to serve the Chinese market over and above our current use of our global network for exports to China. The charts below illustrate our revenues (including freight charges) by geographic location, and our Adjusted EBITDA by segment, in 2013: Our Strengths We believe that the factors set forth below provide us with a competitive advantage. Leading Industry Positions in the Growing Specialty and Rubber Carbon Black Markets We are one of the largest global producers of specialty carbon black with an estimated share of global industry sales of approximately 24% in 2013 measured by sales volume in kmt. We are the third largest producer of rubber carbon black in the world and we have a global rubber carbon black distribution network. We had an estimated share of global industry sales in rubber carbon black of approximately 7% in 2013 measured by volume in kmt. Rubber carbon black sales are largely regional, since transportation costs are high relative to sales prices. We believe that in most of our key operating regions, our estimated rubber carbon black share of industry sales is higher than our global share based on volumes in kmt: approximately 15% in the European Union, 15% in North America, 32% in South Korea, 86% in South Africa and 18% in Brazil in 2013. Table of Contents our relationships with our workforce, including negotiations with labor unions, strikes and work stoppages; our ability to recruit or retain key management and personnel; our exposure to political or country risks inherent in doing business in some countries; environmental, health and safety regulations, including nanomaterial and greenhouse gas emissions regulations, and the related costs of maintaining compliance and addressing liabilities; our investigation by the U.S. Environmental Protection Agency; our operations as a company in the chemical sector, including the related risks of leaks, fires and toxic releases; litigation or legal proceedings, including product liability claims; our ability to protect our intellectual property rights; our ability to generate the funds required to service our debt and finance our operations; fluctuations in foreign currency exchange and interest rates; the availability and efficiency of hedging; changes in international and local economic conditions, including with regard to the Euro and the Eurozone debt crisis, dislocations in credit and capital markets and inflation; potential impairments or write-offs of certain assets; required increases in our pension fund contributions; the adequacy of our insurance coverage; changes in our jurisdictional earnings mix or in the tax laws of those jurisdictions; our indemnities to and from Evonik; challenges to our decisions and assumptions in assessing and complying with our tax obligations; the absence of a previous public market for our ADS; potential conflicts of interests with our principal shareholders; and our status as a foreign private issuer. In light of these risks, our results could differ materially from the forward-looking statements contained in this prospectus. For further information regarding factors that could affect our business and financial results and the related forward-looking statements, see Risk Factors. All subsequent forward-looking statements are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement. New risk factors and uncertainties emerge from time to time and it is not possible for our management to predict all risk Table of Contents We expect the markets we serve to continue growing. Our Specialty Carbon Black segment provides the polymers, printing, coatings and special applications markets with highly customized, application-driven products that impart specific product characteristics, such as high-quality durable pigmentation, UV protection, viscosity control and conductivity. We expect these markets to continue growing because of increasing urbanization, changing packaging requirements and higher quality consumer demands. Our Rubber Carbon Black segment serves the tires and mechanical rubber goods markets and should continue to benefit from increasing mobility trends around the globe as well as the large and less volatile aftermarket of this industry. Leading Technology and Product Innovation Platform that Drives Higher Margin, Specialty Niche Product Offering We have a long-standing reputation in the industry for production expertise and applications knowledge. Our know-how allows us to develop high-quality products tailored to meet customer requirements. We have state-of-the art research facilities, including pilot plants, simulation technologies and sophisticated testing laboratories where we develop new products, and improve process efficiencies that help improve sales and realize cost savings. Our Innovation Group works closely with our clients to develop innovative products and applications. We believe that this collaboration provides us with an understanding of customer needs and improved industry knowledge, reducing time to market for new products. In 2013, we reorganized and consolidated our Innovation Group in one location in Germany (with branch technical centers in the United States, South Korea and China) and placed it under the leadership of a newly hired Senior Vice President Innovation. This reorganization strengthens cooperation among our R&D, applications technology and process development teams to facilitate innovation and bring new products to market faster. Carbon black product properties are influenced by the choice of production technology and operating parameters. We believe that we have the largest array of production and treatment technologies and therefore one of the broadest product offerings in the industry, including products for specialized niche applications and end-uses in higher value sectors. At present, we believe that we are the only global carbon black producer with the ability to produce specialty carbon black using furnace, gas, lamp and thermal black production processes. We believe that the strength of our technology and our innovation capabilities are reflected in our Segment Adjusted EBITDA Margin of 25.1% for the Specialty Carbon Black segment in 2013. Global, Well Invested and Flexible Production Network In 2013, we generated approximately 34% of our revenue by sales in Europe, 27% in North America, 24% in Asia, 7% in Brazil, 5% in Africa and the remainder elsewhere. Our production footprint supports this sales pattern as we operate a modern global supply chain network of four plants in the United States, two in South Korea, two in Germany (one wholly-owned and one jointly-owned) and one each in Brazil, Poland, Italy, France, Sweden and South Africa. This global manufacturing presence and sales reach provides us with a competitive platform to serve our customers. Our broad geographical presence supports global purchasing and expands our access to different feedstock sources around the world. Our broad presence allows us to compete regionally on a cost-effective basis because of the relatively high transportation costs of rubber carbon black, which make most inter-regional shipments less competitive. Our global supply network allows us to quickly establish credentials with customers in new locations and those seeking consistent supply across regions. For example, a customer that uses our products in Asia recently opened new facilities in the United States and purchased our product for the new facilities as well. Similar facilities built by Asian producers in Europe and by Japanese producers in China have also sought our materials. In specialty carbon blacks, we have been successful in translating grades for global customers produced in one region to another production site due to the strength of our reputation, our technical support and our consistent global quality. Table of Contents factors and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. Table of Contents The geographic diversity of our operations lowers our dependency on any particular region. Our specialty carbon black production sites are located in strategic parts of Europe, North America and Asia and serve customers globally, with plants, technical application staff and labs in close proximity to key customer sites. The scale and breadth of our product offering positions us to take advantage of favorable trends in both developed and emerging countries. We believe we are well placed to serve the key emerging growth markets through our manufacturing presence in South America (Brazil), Sub-Saharan Africa (South Africa), Asia (South Korea) and Eastern Europe (Poland). The acquisition of QECC, if completed, will improve our presence in China. In addition, following the Acquisition, we established a presence in Malaysia, Thailand, India and the UAE and are scheduled to open a business office in Indonesia by the end of 2014. Our diverse and flexible production and sales network also lowers our dependency on individual products, raw materials and end-uses. We have recently invested in strategic sites to increase the capacity and flexibility of our production platform. For example, we increased our capacity by adding a new rubber carbon black production line in South Korea, which freed capacity in existing units for potential further specialty carbon black production. This line began operations in 2013. We are also making incremental capacity increases at various sites in the United States, Brazil and Southern Europe to meet demand from tire and mechanical rubber goods producers. In addition, in 2014, we commissioned a specialty carbon black after-treatment facility in Germany for higher margin products and are currently revamping a rubber carbon black line in Texas to produce specialty carbon black grades. These improvements allow us to opportunistically shift our capacity to produce higher margin products. Since the Acquisition and until the end of 2013, we invested 165.5 million to upgrade, make more flexible and streamline our production network, to install cost-saving features such as energy recovery equipment and to provide for technological innovation in our manufacturing process. Long-standing, Deep Relationships with Blue-chip Customer Base We are a supplier to approximately 1,000 customers and operate in more than 80 countries, and have been a long-term supplier to many blue-chip companies. We serve approximately 700 customers in our Specialty Carbon Black segment and approximately 300 customers in our Rubber Carbon Black segment. We serve many of the largest, strategically positioned, global users of carbon black, many for over 30 years, including BASF, PolyOne and AkzoNobel in specialty carbon black products, Bridgestone, Goodyear and Michelin in tires and Cooper Standard, Hexpol and Hwaseung in mechanical rubber goods. We believe that our reputation results from our focus on high product quality, consistency, reliability and innovation and our ability to customize our products, combined with locally-based technical product and applications support and key account management. We believe that these qualities have helped us achieve a preferred supplier status with many blue-chip customers. Specialty and rubber carbon black applications require rigorous testing and approval processes, some of which can be lengthy. We believe that these processes, as well as the high degree of customization for a number of our products, help promote long-term customer relationships. Flexible Contracts with the Ability to Pass Through Raw Material Cost Increases We have a proactive price and contract management strategy, which supports our efforts to preserve our margins by passing feedstock and energy cost increases through to our customers on a timely basis. In recent years, global oil prices have fluctuated significantly; for example, Brent crude oil prices increased from $70 per barrel in May 2010 to a peak of $127 per barrel in April 2011, declining to $110 per barrel by the end of December 2013. A significant portion of our contracts have formula-driven price adjustment mechanisms for changes in raw material and energy costs (approximately 72% in the Rubber Carbon Black segment and approximately 42% in the Specialty Carbon Black segment, based on sales volumes in kmt in 2013). Most of our indexed contracts allow for monthly price adjustments, while a relatively small portion allow for quarterly price Table of Contents PRESENTATION OF FINANCIAL AND OTHER INFORMATION The Company (also referred to in this prospectus as the Successor ) was incorporated on January 10, 2011. On July 29, 2011, the Company completed the acquisition from Evonik Industries AG ( Evonik ) of its carbon black business line (referred to in this prospectus as Evonik Carbon Black or the Predecessor ). In this prospectus, references to Euro and are to the single currency adopted by participating member states of the European Union relating to Economic and Monetary Union, references to $ , US$ and U.S. Dollars are to the lawful currency of the United States of America and references to Korean Won are to the lawful currency of the Republic of Korea. Non-IFRS Financial Measures The financial statements included in this prospectus were prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board ( IFRS ). In this prospectus, we present certain financial measures that are not recognized by IFRS and that may not be permitted to appear on the face of IFRS-compliant financial statements or notes thereto. The non-IFRS financial measures used in this prospectus are Contribution Margin, Contribution Margin per Metric Ton (collectively, Contribution Margins ), Adjusted EBITDA, Net Working Capital and Capital Expenditures. We define Contribution Margin as revenue less variable costs (raw materials, packaging, utilities and distribution costs). We define Contribution Margin per Metric Ton as Contribution Margin divided by sales volume measured in metric tons. We define Adjusted EBITDA as operating result (EBIT) before depreciation and amortization, adjusted for acquisition related expenses, restructuring expenses, consulting fees related to group strategy, share of profit or loss of associates and certain other items. Adjusted EBITDA is defined similarly in the indenture governing our senior secured notes due 2018 (the Senior Secured Notes ). We believe that Adjusted EBITDA is a useful profitability measure used by our management to evaluate our operating performance and make decisions regarding allocation of capital. We define Net Working Capital as inventories plus current trade receivables minus trade payables. We define Capital Expenditures as Cash paid for the acquisition of intangible assets and property, plant and equipment as shown in the audited consolidated financial statements. We also use Segment Adjusted EBITDA Margin, which we define as Adjusted EBITDA for the relevant segment divided by the revenue for that segment. Adjusted EBITDA for our segments and Segment Adjusted EBITDA Margin are financial measures permitted under IFRS. We use Adjusted EBITDA, Contribution Margins and Net Working Capital, as well as Adjusted EBITDA by segment and Segment Adjusted EBITDA Margin, as internal measures of performance to benchmark and compare performance among our own operations. We use these measures, together with other measures of performance under IFRS, to compare the relative performance of operations in planning, budgeting and reviewing the performance of our business. We believe these measures are useful measures of financial performance in addition to consolidated profit (or loss) for the period, operating result (EBIT) and other profitability measures under IFRS because they facilitate operating performance comparisons from period to period and company to company and, with respect to Contribution Margin, eliminate volatility in feedstock prices. By eliminating potential differences in results of operations between periods or companies caused by factors such as depreciation and amortization methods, historic cost and age of assets, financing and capital structures and taxation positions or regimes, we believe that Adjusted EBITDA can provide a useful additional basis for comparing the current performance of the underlying operations being evaluated. For these reasons, we believe EBITDA-based measures are often used by the investment community as a means of comparison of companies in our industry. By deducting variable costs (raw materials, packaging, utilities and distribution costs) from revenue, we believe that Contribution Margins can provide a useful basis for comparing Table of Contents adjustments. Terms of our non-indexed contracts are usually short and we review sales prices under these contracts regularly to reflect raw material and energy price fluctuations as well as overall market conditions. We believe that our indexed and short-term contracts position us well to pass changes in raw material and energy costs through to our customers in a reasonably timely fashion. We also believe that this practice has enabled us to maintain our Segment Adjusted EBITDA Margins since the Acquisition, despite significant fluctuations in oil and other raw material prices, and largely obviates our need to engage in financial transactions to hedge against oil price fluctuations. For additional information about our price and contract management strategy, see Business Marketing, Sales and Customer Contracts Flexible Contracts and Management s Discussion of Financial Condition and Results of Operations Key Factors Affecting our Results of Operations Raw Materials and Energy Costs. Strong Operating Earnings Growth and Cash Generation Since the Acquisition Since the completion of the Acquisition, we improved our profitability by achieving higher operating margins for both the Specialty Carbon Black and Rubber Carbon Black segments, implementing operating efficiencies, enhancing raw material sourcing, improving our production facilities and improving pricing above those price changes resulting from passing through changes in raw materials and energy costs for rubber carbon black. These measures helped increase our Contribution Margin per Metric Ton from 351.8 in the post-Acquisition period ending December 31, 2011 to 409.4 in the full year 2013 (our Gross Profit per Metric Ton was 215.1 in the post-Acquisition period ending December 31, 2011 and 296.6 in the full year 2013). We have also managed to achieve a leaner cost structure on a stand-alone basis, replacing the full overhead structure provided by Evonik while also reducing headcount overall. We also improved our cash generation by reducing our Net Working Capital requirements by improving inventory and supply chain management, feedstock purchasing, production scheduling and receivables and payables management. Since the Acquisition, our management reduced the average number of days for which we need to maintain Net Working Capital from over 100 days to less than 70 days. Since the Acquisition, we have been able to reduce our outstanding debt by repaying portions of our Senior Secured Notes, with the outstanding principal amount of those notes declining by approximately 78 million from the end of 2011 to the end of 2013. We were able to reduce our indebtedness during this period despite the significant investments we have made in improving our manufacturing infrastructure since the Acquisition. As a result, coupled with growing Adjusted EBITDA, we have been able to reduce our Net Leverage Ratio (Net Debt (our Senior Secured Notes and Shareholder Loan, including capitalized interest, net of cash) at period end as a multiple of Adjusted EBITDA for the trailing 12 months) from 4.77x at the end of 2011 to 3.94x at the end of 2013. We expect to achieve a substantial further reduction in leverage upon the completion of this offering and the Refinancing described below. Highly Experienced, Entrepreneurial Management Team with Proven Track Record Our senior management has an average of more than 20 years of business and industry experience. Our chief executive officer, Jack Clem, joined an affiliated joint venture of the business in 2001 and has over 35 years of experience in the performance materials and chemicals industry, with a significant portion of his career in carbon black. Our chief financial officer, Charles Herlinger, has served as chief financial officer for both public and private companies. Our senior managers are veterans of global materials businesses and have a track record of achieving profitable growth and managing through economic cycles. In addition to our experienced management team, the company leadership was further enhanced after the Acquisition by the addition of senior key members. Of our eight Executive Officers who currently report to our chief executive officer, five joined the company after the Acquisition. Table of Contents the current performance of the underlying operations being evaluated by indicating the portion of revenue that is not consumed by variable costs (raw materials packaging, utilities and distribution costs) and therefore contributes to the coverage of all costs and profits. Different companies and analysts may calculate measures based on EBITDA, contribution margins and working capital differently, so making comparisons among companies on this basis should be done carefully. Adjusted EBITDA, Contribution Margins and Net Working Capital are not measures of performance under IFRS and should not be considered in isolation or construed as substitutes for revenue, consolidated profit (loss) for the period, operating result (EBIT), gross profit and other IFRS measures as an indicator of our operations in accordance with IFRS. Reconciliation of Non-IFRS Financial Measures The non-IFRS financial measures contained in this prospectus are unaudited (except for Adjusted EBITDA) and have not been prepared in accordance with IFRS or the accounting standards of any other jurisdiction and may not be comparable to other similarly titled measures of other companies. For a reconciliation of these non-IFRS financial measures to the most directly comparable IFRS measures, see Management s Discussion and Analysis of Financial Condition and Results of Operations Reconciliation of Non-IFRS Financial Measures. INDUSTRY, RANKING AND OTHER DATA Information included in this prospectus relating to industries, industry size, share of industry sales, industry position, industry capacities, industry demand, growth rates, penetration rates, average prices and other industry data pertaining to our business consists of estimates based on data reports compiled by professional third-party organizations and analysts, on data from external sources, on our knowledge of our sales and industries in which we operate and on our own calculations based on such information. In particular, certain information has been provided by Notch Consulting Group, and share of industry sales estimates are derived from information provided by Notch Consulting Group. In many cases, there is no readily available external information (whether from trade associations, government bodies or other organizations) to validate industry-related analyses and estimates, thus requiring us to rely on internally developed estimates. While we have compiled, extracted and reproduced industry data from external sources, including third-party, industry or general publications, we have not independently verified the data and cannot assure you of its accuracy or completeness. Similarly, while we believe our internal estimates to be reasonable, they have not been verified by any independent sources, and we cannot assure you as to their accuracy. Forecasts and other forward-looking information with respect to industry and ranking are subject to the same qualifications and additional uncertainties regarding the other forward-looking statements in this prospectus. See Note Regarding Forward-Looking Statements. TRADEMARKS AND TRADE NAMES We own or have rights to certain trademarks and trade names that we use in conjunction with the operations of our business. Each trademark, trade name or service mark of any other company appearing in this prospectus belongs to its holder. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Table of Contents Our new management team helped us reach stand-alone status following the Acquisition faster than targeted by our shareholders and achieved substantial improvements in operational processes, such as headcount reduction, talent upgrading, operating margins, customer and product mix management, working capital management, financial transparency and supply chain effectiveness. Our Risks and Challenges Our business is subject to numerous risks and challenges that we describe in Risk Factors and elsewhere in this prospectus. You should carefully consider these risks and challenges before investing in our ADS. Our key risks and challenges include, but are not limited to, the following: negative or uncertain worldwide and regional economic conditions, which may adversely affect demand for our products in our key markets; strong competition and fast development of new products that could be used as a substitute for carbon black and reduce demand for our products, or similar developments that could reduce demand for our customers products or make us unable to implement our business strategies; volatility in the industry and in the costs and availability of raw materials and energy, which could adversely affect our profitability and cash flows, especially if we are unable to adjust our pricing quickly enough to pass rising costs to our customers; high customer concentration and dependence on our major customers; risk of actual or alleged violations of environmental regulations, investigations by environmental protection agencies in Europe, the United States and elsewhere (including the pending investigation of our U.S. operations by the U.S. Environmental Protection Agency (the EPA )) and liabilities that we could incur under such laws and regulations as a result of litigation and regulatory proceedings (including fines, capital expenditures and remediation costs that could arise from the pending EPA investigation). For more information, See Business Environmental, Health and Safety Matters Environmental Environmental Proceedings ; and safety and health risks resulting from our operations as a company in the chemical sector. Our Strategy We intend to use our core competencies in carbon black production and end-use application knowledge to continue strengthening our market shares, our long-term profitability and our position as a preferred supplier in major markets around the world, as follows: Continue Strengthening Our Leadership Position in Specialty Carbon Black We believe that our Segment Adjusted EBITDA Margin of 25.1% in 2013 and our share of global industry sales for the Specialty Carbon Black segment demonstrate that we are a global leader in these carbon black products. We intend to continue strengthening our position as a premium producer of these products by increasing our presence in the markets we serve. We expect this growth to be driven by new premium performance specialties to address increasing customer requirements and by expanding both our technical sales coverage and production platforms to better supply emerging markets where historically we have been under-represented. Since the Acquisition, we have increased personnel in our specialty carbon black sales force by approximately 15%. We will continue upgrading and expanding our technical sales support capabilities by recruiting and retaining regional industry experts in specialty carbon black applications and key account management. We also plan to implement initiatives to match local production with local demand by expanding Table of Contents our specialty carbon black capacity in regions such as Asia and South America. We will continue our shift to higher margin products as opportunities arise and through ongoing investment in facilities, technology and R&D. We have focused our innovation efforts on certain Lighthouse Projects , which we define as those critical initiatives targeted at delivering premium products for high value applications such as conductive materials, advanced insulation materials, battery applications and the next generation of coatings. Our investments in after-treatment facilities in Germany came on line in early 2014 and are expected to help support continued growth in these materials. A new generation reactor is planned to commence operation in 2015 in Germany, adding another advanced technology to our production platform. This unit will be directed to specialized materials for proprietary applications. The trend of shifting rubber carbon black production to specialty carbon black capacity will continue with the next line conversion scheduled for late 2014 in the United States. Planning is underway for similar conversions in Asia and South America, following recent conversions at Malm (Sweden) and Belpre (Ohio). Continue Increasing Our Rubber Carbon Black Margins While Growing Globally with Our Customers We expect to grow our business by expanding our production to meet the demands of our customers in our regional markets. These markets are expanding with the growing mobility trends around the world and we are well situated to supply these regions with a strong production footprint. We have expanded capacity in South Korea and will be using the additional volumes of this unit to address the markets in South Korea and the larger Asia-Pacific region, which should help expand our market share in that region. We are also seeking to acquire QECC, which would give us better access to the Chinese market for rubber carbon black, a market we believe offers significant opportunities for profitable growth and which we currently serve only through export channels. We are also actively seeking other acquisition opportunities and joint venture partners in China to further expand our rubber carbon black production base (as well as provide a future platform for specialty carbon black production). Planning is underway to increase capacities in our facility in Paulinia (Brazil) to meet the demands of major tire and mechanical rubber companies that are expanding in South America. Our plant in Jaslo (Poland) is well situated to serve the growing Eastern European market. As this region grows, we will be prepared to add capacity to this facility. We have recently taken steps to eliminate bottlenecks in our U.S. platform in order to meet demand as tire companies commission new manufacturing facilities in the United States. We also seek to improve the profitability of our rubber carbon black business by developing applications in higher margin markets for mechanical rubber goods and specialty tire requirements. For example, we recently increased capacity in South Korea and Southern Europe for mechanical rubber goods grades that offer improved performance in compounds for automotive sealing systems. We are also supporting our customers efforts to meet labeling requirements for tires in Europe and those to come in the United States, South Korea and other countries, by ensuring consistent quality within tightening specifications from our global network. A major Lighthouse Project is also underway to commercialize new grades of rubber carbon black that offer a substantial increase in tread life while maintaining other properties such as rolling resistance and traction. With the increased visibility provided by our recently upgraded global management information system, we are better positioned to continue improving our customer and product mix by shifting to more profitable customer/location/grade combinations in our markets around the world. Our global management information system also supports enhanced efforts in price discipline and management of cost increase pass-throughs where necessary and should help us gain a more strategic balance in our relationships with our global key accounts and larger regional accounts. Table of Contents Strengthening the Competitiveness of Our Operations We have improved the operating efficiency of our business since the Acquisition. Our goal is best-in-class operating economics in our production platform and a streamlined business structure for Orion as a whole. We believe that our current operational efficiency, flexibility and reliability give us a competitive foundation for future value-creation. We intend to continue our production and energy efficiency initiatives by further exploiting alternative feedstock sources, while optimizing our feedstock and energy purchasing and pricing methods. We will continue upgrading our production lines with the higher efficiency Orion Design reactors, which are expected to help increase yield and improve reliability. We recently commissioned Orion Design reactors in Ivanhoe (Louisiana) and Orange (Texas) and plan to install such reactors in several other facilities in the United States as well as in Asia and South Africa. We have seen strong increases in global energy efficiency since we installed upgraded heat-recovery equipment in a number of our plants and expect to continue this upgrade at other plants as opportunities for efficiency improvements arise. Since the Acquisition we have adopted a series of best-practices in our production network. These new standards and approaches have helped us increase our operating efficiencies without significant capital expenditure and will add more value as we continue to develop them. We will continue to focus managerial resources on bringing all of our facilities in line with these higher standards while systematizing our improved practices to make the gains sustainable. We have used similar best-practice standards for our High Performance Organization ( HPO ) initiative. HPO is targeted at redesigning work processes and increasing employee involvement to improve productivity. We began operating as an independent company with well over 1,500 employees at the time of the Acquisition. Despite having to hire more than 60 administrative personnel to provide a range of services previously provided by Evonik, as a result of certain headcount reduction initiatives we reduced our personnel to 1,405 at the end of 2013. The closure of our Sines (Portugal) plant in December 2013 will lead to a further headcount reduction of approximately 35 full-time employees (FTEs) in 2014. Our headcount reduction efforts included a continuing talent upgrade program that has resulted in the reduction of well over 250 personnel, replaced with approximately 100 higher-qualified personnel. A key success in this area has been the revamping of our senior management team, replacing a majority of the positions with globally experienced senior managers. In addition, we intend to continue implementing a more efficient corporate and management structure at less senior levels, coupled with compensation arrangements that strengthen incentives for our employees with individual performance-linked bonuses based on value creation and cash generation. We intend to further improve our global management information system to provide better transparency and improve organizational efficiencies, having completed in 2013 the rollout of our globally standardized SAP platform. Such transparency permits better pricing and portfolio mix decisions, clear cost accountability within the organization and improved performance through continued pursuit of best practices in distribution methods and supply chain management, including global inventory management, integrated sales and production planning, and process efficiency upgrades. Our operations key performance indicator system provides management with a more timely and consistent view of the critical operating parameters of our platform around the globe. A specialized team of engineers is ready to act quickly on anomalies identified by the newly commissioned system. Corporate History and Information We are currently a German limited liability company (Gesellschaft mit beschr nkter Haftung), with a registered office in Frankfurt am Main, Germany. We were incorporated on January 10, 2011 and are registered with the commercial register maintained by the local court (Amtsgericht) of Frankfurt am Main, Germany, under HRB 90495 B. Prior to the completion of this offering, we expect to become a German stock corporation Table of Contents (Aktiengesellschaft or AG). Our principal executive offices are located at Hahnstra e 49, 60528 Frankfurt am Main, Germany, and our telephone number is +49 69 36 50 54-100. Our website address is www.orioncarbons.com. The information contained on, or that can be accessed through, our website is not part of, and is not incorporated into, this prospectus. Our agent for service of process in the United States is Corporation Service Company, located at 1180 Avenue of the Americas, New York, NY 10036, telephone number (800) 927-9800. Historically, our business operated as a business line of Evonik. Effective July 29, 2011, the Rh ne Investors and the Triton Investors indirectly acquired from Evonik the entities operating its carbon black business. Currently, we operate on a fully stand-alone basis. We operate our businesses through a number of direct and indirect subsidiaries. Our Principal Shareholders and Selling Shareholder Our principal shareholders are the Rh ne Investors and the Triton Investors (the Principal Shareholders ). The Selling Shareholder is Kinove Luxembourg Holdings 2 S. r.l., a Luxembourg entity that is primarily owned, indirectly, by the Principal Shareholders. The remaining ownership interests in the Selling Shareholder are held indirectly by Luxinva S.A. (the ADIA Investor ), a wholly owned subsidiary of the Abu Dhabi Investment Authority, a public institution wholly owned by the Government of the Emirate of Abu Dhabi, and by members of our management, through an investment vehicle described below under Related Party Transactions Management Participation Program. After giving effect to this offering the Rh ne Investors, the Triton Investors, the ADIA Investor and Management Investors (as defined below) will own, indirectly, %, %, % and %, respectively, of our ordinary shares ( %, %, % and %, respectively, assuming full exercise of the underwriters option to purchase additional ADS). See Principal Shareholders and Selling Shareholder. Refinancing At or prior to the closing of this offering, we intend to take the following steps to refinance our outstanding borrowings (the Refinancing ). The matters described below reflect our current estimates and plans. Enter into a new credit facility (the New Credit Facility ) consisting of (i) a term loan, which we expect would have a final maturity in and would accrue interest at an annual rate between % and %, and (ii) a multicurrency revolving line of credit of up to , which we expect would have a final maturity in and would accrue interest at an annual rate between % and %; and Use the net proceeds from the term loan described above, together with all net proceeds we receive from this offering and available cash, to do the following: redeem our outstanding Senior Secured Notes in full, in an aggregate principal amount of approximately (plus approximately of redemption premium and accrued interest); and repay an outstanding loan from an affiliate of the Selling Shareholder (the Shareholder Loan ) in full, in an aggregate principal amount of approximately (plus approximately of accrued interest), which will be used, together with other funds from the Selling Shareholder, to repay all the outstanding PIK Toggle Notes due 2019 issued by an affiliate of the Selling Shareholder. Table of Contents Upon completion of this offering and the Refinancing, our current indebtedness described in this prospectus under the section entitled Description of Material Indebtedness would be extinguished and, together with our existing $250.0 million revolving credit facility (the Revolving Credit Facility ) (which is undrawn), would be replaced with the New Credit Facility. As a result of these steps, we would expect that our outstanding total liabilities would be reduced by approximately , or %, from the amount outstanding as of December 31, 2013. In addition, we would expect the Refinancing to substantially reduce our interest costs, which have reflected annual interest rates, in the case of the Senior Secured Notes, of 10.000% (Euro tranche) and 9.625% (U.S. Dollar tranche) and, in the case of the Shareholder Loan, 10.74% (if interest is paid in cash) and 11.59% (if interest is capitalized). In comparison, we estimate that the new term loan would have an annual interest rate between % and %. The Euro amounts referred to above include U.S. Dollar amounts converted at the convenience translation rate as of December 31, 2013 described under Currencies and Exchange Rates. For more information about the potential impact of this offering and the Refinancing on our balance sheet, see Capitalization. Table of Contents
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+SUMMARY OF PROSPECTUS You should read the following summary together with the more detailed business information, financial statements and related notes that appear elsewhere in this Prospectus regarding Stallion Synergies, Inc (the Company ). In this Prospectus, unless the context otherwise denotes, references to we, us, our, and STALLION are to the Company. A CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements, which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as may, should, expects, plans, anticipates, believes, estimates, predicts, potential, or continue or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled Risk Factors, (page 5) that may cause our or our industry s actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001605740_agrieuro_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001605740_agrieuro_prospectus_summary.txt
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+PROSPECTUS SUMMARY AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, "WE," "US," "OUR," AND "ARTEX CORP." REFERS TO ARTEX CORP. THE FOLLOWING SUMMARY PROVIDES A BRIEF OVERVIEW OF THE KEY ASPECTS OF THE OFFERING. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK. ARTEX CORP. We are a development stage company and we are in pursuit of business of selling popcorn from mobile popcorn carts in Poland. We have already purchased our first Popcorn machine/cart on February 17, 2014. We plan to place our popcorn carts in Poland major cities such as Warsaw, Krakow and Lodz. On March 02, 2014 in Warsaw we have signed lease agreement (Exhibit 10.1) with Leszek Piekut on placing one Popcorn cart at his location in Warsaw. The locations that we think will be most suitable for our product are shopping malls, schools, colleges, universities, streets, flea markets, expo shows, ferries, sport games and concerts. We have purchased one popcorn machine with cart but have not made the placement. As a result, we do not have any operational revenues. Being a development stage company, we have no revenues and have limited operating history. Artex Corp. was incorporated in Nevada on October 24, 2013. To date we have prepared a business plan, signed lease agreement (Exhibit 10.1) and purchased one 12 oz popcorn machine with cart. Our principal executive office is located at Ciechocin 28, Ciechocin, 87-100 Poland. Our phone number is + 1 925 399 8016. We do not have a website. We require a minimum funding of $25,000 to conduct our 12 months plan of operation, and if we are unable to obtain this level of financing, our business may fail. We are a company without revenues and have just recently started our operations; we have minimal assets and have incurred losses since inception. Our financial statements for the period from October 24, 2013 (date of inception) to May 31, 2014, report no revenues and a net loss of $5,704. As of May 31, 2014 we had $ 4,157 in cash on hand. As of the date of this prospectus we had $ 2,640.12 in cash on hand. Our independent registered public accountant has issued an audit opinion for Artex Corp. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. If we are unable to obtain additional working capital our business may fail. To date, the only operations we have engaged in are the development of a business plan and the purchase of a popcorn machine. We intend to use the net proceeds from this offering to develop our business operations (See "Description of Business" and "Use of Proceeds"). Being a development stage company, we have very limited operating history. Proceeds from this offering are required for us to proceed with our business plan over the next twelve months. We require minimum funding of $25,000 to conduct our proposed operations and pay all expenses for a minimum period of one year including expenses associated with maintaining a reporting status with the SEC. If we are unable to obtain minimum funding of $25,000, our business may fail. Even if we raise $100,000 from this offering or more, we may need more funds to develop growth strategy and to continue maintaining a reporting status. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. Our president devotes approximately 20 hours/week to the business and he has no prior experience managing a public company. If necessary, Jacek Niezgoda, our president, has verbally agreed to lend funds to pay for the registration process and lend funds to implement your business plan and to help maintain a reporting status with the SEC in the form of a non-secured loan for the next twelve months. The loan is unsecured, non-interest bearing and due on demand. However, the verbal agreement is not binding and that there is no guarantee that we will receive such loans. There has been no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority ("FINRA") for our common stock to be eligible for trading on the Over-the-Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There can be no assurance that our common stock will ever be quoted on a stock exchange or a quotation service or that any market for our stock will develop. THE OFFERING The Issuer: Artex Corp. Securities Being Offered: 10,000,000 shares of common stock Price Per Share: $0.01 Duration of the Offering: The offering shall terminate on the earlier of: (i) the date when the sale of all 10,000,000 common shares is completed; (ii) one year from the date of this prospectus; or (iii) prior to one year at the sole determination of the board of directors. Securities Issued and Outstanding: There are 3,500,000 shares of common stock issued and outstanding as of the date of this prospectus, held solely by our sole officer and director, Jacek Niezgoda. Registration Costs: We estimate our total offering registration costs to be approximately $10,000. Risk Factors: See "Risk Factors" and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock. SUMMARY FINANCIAL INFORMATION The summarized financial data presented below is derived from, and should be read in conjunction with, our audited financial statements and related notes from October 24, 2013 (date of inception) to February 28, 2014, included on Page F-1 in this prospectus. FINANCIAL SUMMARY May 31, 2014 ($) ---------------- Cash and Deposits 4,157 Total Assets 5,996 Total Liabilities 8,200 Total Stockholder's Equity (2,204) STATEMENT OF OPERATIONS Accumulated From October 24, 2013 to May 31, 2014 ($) ---------------- Total Expenses 5,704 Net Loss for the Period 5,704 Net Loss per Share 0.00
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+consents necessary to affect that type of transfer as it begins to make investments and grow its portfolio. We are only required to perfect a security interest in our entire investment portfolio upon the first occurrence of a Default under the Trust Indenture Agreement. After a Default continues beyond any cure period, the CPSA requires us to promptly perfect security interests in all of our investment portfolio assets in favor of the Trustee and Debenture Holders. Whether that security interest has a first, second or possibly third lien priority will depend on whether we enter into Senior Debt before any first Default. After a first Default, the security interest in favor of the Debenture Holders will be set and available to the Trustee for foreclosure on the first Default and every Default thereafter. The Contingent Pledge and Security Agreement also provides for the possibility that deeproot-GRD or a new Grantor may pledge additional assets for the benefit of the Trustee and the Debenture Holders. However, as a practical matter, it is unlikely that there will be any additional assets of deeproot-GRD that are not covered by the initial grant of security interest in favor of the Trustee. It is possible that the pledge of certain assets by other entities in our parent organization will occur if and when an Interest Accrual Default occurs. The pledge of additional assets with a Fair Market Value equal to the shortfall in Valuation of our investment portfolio can cure such an Interest Accrual Default. OUR BUSINESS Investment Strategy to be Employed Our sole business is to invest capital in asset classes that provide a higher return and higher risk profile than that typically found in a traditional investment portfolio, while controlling the risk involved through: 1) high quality underwriting and due diligence particularly with respect to illiquid investments within the portfolio; and 2) superior management of cash reserves and liquid investment ratios. We intend to work toward creating a portfolio composed of roughly sixty percent (60%) invested in life settlements; twenty percent (20%) invested in Trust Deeds (whether whole loans or participation interests) which produce regular income and other income producing securities; ten percent (10%) invested in illiquid positions in private companies with higher potential return; and ten percent (10%) in cash or cash equivalents. Life Settlements We will invest in Life Settlements, which are sales to third parties, of existing life insurance contracts held on insurers who are 70 years of age or older. The policy is purchased for more than their cash surrender value but less than the net death benefits to be paid under the policies. These Life Settlements will not include policies on the lives of terminally ill patients under the age of 70. When we acquire such a contract, we pay the policy premiums in return for the receipt of the net death benefit as the new owner and beneficiary under the policy. Investments in these contracts involve certain risks, including liquidity risk, risk of excessive premium payments beyond the insured individual s life expectancy, credit risk of the insurance company, and inaccurate estimations of life expectancy of the insured individuals. These policies are considered illiquid in that they are bought and sold in a secondary market through life settlement agencies and not on any exchange where settlement of a transaction is required in a timely manner. In the event of a bankruptcy of the insurance carrier for a policy, we may receive reduced or no benefits under the contract. Furthermore, an investor such as us may encounter losses on its investments if there is an inaccurate estimation of the life expectancies. We will seek to minimize risk by investing in policies issued by a diverse range of highly-rated insurance carriers; and in policies that vary: by life expectancy, by net death benefits, and by annual premium payments. We intend to reduce the life expectancy risk by investing only in contracts where the life expectancy was reviewed by an experienced independent medical professional and/or actuary, as well as by diversifying the investments across insured individuals varying ages and medical profiles. Target Life Settlement Portfolio Summary Minimum age of insured individuals 70 Life expectancy average 8 years Targeted internal rate of return 10%/year Premium reserves Life Expectancy + 1 Insurance carrier AM Best rating A- or higher Second to die policies < 5% of aggregate acquisition costs In the past, our principals have purchased life insurance policies through secondary market transactions directly from a middle source provider. The middle source provider purchased the policy directly from an owner/insured that purchased the life insurance in the primary market. Each policy considered by us will be underwritten by an independent third party medical actuarial firm who will issue a report providing a life expectancy estimate on each insured. We will base our life expectancy estimates on the estimates provided by the actuarial firm plus one year. The policies we will purchase are universal life insurance policies issued by rated life insurance companies. Universal life insurance is a type of permanent life insurance in which premium payments above the cost of insurance are credited to the cash value of the policy. The cash value is credited each month with interest based on the terms of the insurance policy agreement. If a universal life insurance policy were to lapse, the insured or other owner of the policy would nonetheless have a right to receive the cash value of the policy. Universal life insurance is different from term life insurance in that term life insurance does not have a cash value associated with it. The price we will be willing to pay for a policy in the secondary market is primarily a function of: (1) the policy s face value, (2) the expected actuarial mortality of the insured, (3) the premiums expected to be paid over the life of the insured, and (4) market competition from other Holders. We seek to earn profits by purchasing policies at discounts to the face value of the insurance benefit. The discounts at which we purchase are expected to exceed the costs necessary to pay premiums, financing and servicing costs through the date of the insured s mortality. We rely on the actuarial life expectancy assumptions provided to us by third-party medical actuary underwriters to estimate the expected mortality of the insured. We will seek to finance our Life Settlement purchases and the payment of premiums and financing costs through the sale of these Debentures. Trust Deeds A Trust Deed investment is a short-term financial agreement between a borrowing business and private investors secured by real property and the tangible improvements or assets thereon. These types of loans are generally not available from traditional business lenders. There are four parties involved in a trust deed transaction, the Trustor, the Trustee, the Broker and the Beneficiary. The Trustor is the Borrower of the money. The Trustor can be an individual, a trust, or any other lawful entity. The Trustee is appointed to exercise foreclosure and administrative powers in the event of a default or other need. The Broker brings together the Trustor and Beneficiaries to effectuate the transaction. Lastly, the Beneficiary is the investor who places and loans the capital to the Trustor through the trust deed transaction. There are several factors that we consider when choosing to purchase a Trust Deed. First, we conduct due diligence to determine the experience and reputation of the Broker. Second, we review documentation concerning the liquidity of the Borrower to ensure that the payments can be made consistently and on time. Third, we look for Trust Deeds that have a Loan to Value ratio ( LTV ) of fifty percent (50%) or less that provides a greater likelihood for repayment in the event of a default. As with any loan, the borrower makes a periodic payment of principle and interest until the trust deed is paid off and released. Most terms range from six months to two years. It is possible that a Borrower could renew a Trust Deed (even beyond two years), but the rate of periodic payments will not change. If a borrower defaults, our rights include foreclosure and seizure of collateral assets. We will employ Trust Deeds for three reasons: (1) they provide relatively secure, above market periodic payment rates compared to other fixed income investments, (2) they provide a consistent and predictable flow of income to balance the illiquid nature of life settlements, satisfy administrative costs, and build or maintain our reserves, and (3) Trust Deeds to a large extent have lower costs, are easier to maintain, and have a greater collateral value in the event of default. Private Placements A private placement is the purchase of an illiquid or restricted investment position in another enterprise which is typically privately held, with the anticipation of significant return of income or capital, if the enterprise is successful. There is an extreme risk of loss in this type of investment. We will seek to minimize this risk by limiting private placements to ten percent (10%) of its total portfolio value. Cash and Cash Equivalents We intend to hold reserves and operating accounts in the form of cash (U.S. Dollars) and cash equivalents (e.g. money market accounts, U.S. Treasury instruments). While we formally assess cash and cash equivalents to ten percent (10%) of the total portfolio value, we are likely to hold more than this percentage in reserve to ensure there is ample liquidity to purchase additional investments and promptly satisfy withdrawal requests. Cash and cash equivalents earn little interest, and therefore, can be a drain on asset returns. As such, our reserves allow cash and cash equivalents to drop below ten percent (10%) of the total investment portfolio value if we determine, in our sole discretion, that: i) using that capital for another temporary purpose will outweigh the safety consideration of keeping a consistent low return reserve; and ii) the temporary drop in reserves will not affect foreseen expenditures or predictable withdrawal requests. RELATED ADVISER AND FEES Related Adviser, Personnel and Relationships We are advised by deeproot Advisory Services, LLC, a registered investment adviser (the Adviser ). The Adviser consists of one Manager, Aaron F. Flores, who is also the Chief Investment Officer. The sole member of deeproot Advisory Services, LLC is Policy Services, Inc., the parent entity of deeproot Capital Management, LLC, which wholly owns deeproot Funds, LLC which, in turn, wholly owns deeproot-GRD and also is deeproot-GRD s sole Manager. Investment Portfolio Advisor Aaron F. Flores is an investment professional with over seven years of experience in financial advising, wealth management servicing, and securities trading at both USAA Investment Management Company and Citigroup. Aaron is a native Texan from Northwest Texas and earned degrees from Texas Tech University in Business and Spanish. He holds a Series 65 license and has held the Series 63, and FINRA Series 7 licenses. Aaron also holds the Accredited Asset Management Specialist AAMS and Chartered Retirement Planning Counselor CRPC designations from the College for Financial Planning. Asset Allocation Philosophy Our asset allocation policy is designed around a three pronged approach to investing: Avoid the unpredictable broader stock and bond market; Invest in assets that are themselves collateralized or backed by a highly rated corporate or governmental entity; and Adhere to an allocation structure that rewards investors with competitive returns. This approach is appealing in today s market. It insulates investors from the external manipulations of the stock and bond markets. It minimizes interest rate fluctuations. It allows a predictable return without risk of loss for liquidity. And it provides multiple layers of protection and safety. deeproot-GRD is a new approach to the standard industry fixed income product. By using a blend of capital producing assets to income producing assets, we offer an alternative to the traditional stock and bond market that is prone to unpredictable fluctuations. The end result is a Debenture that rewards investors without compromising integrity and reliability. In furtherance of its guiding philosophy, the Advisor will select suitable investments for its portfolio, which may include: life settlements, trust deeds, commercial real estate, private placements, cash or cash equivalents. Terms of the Investment Advisory Agreement with deeproot-GRD The investment advisory agreement between deeproot Advisory Services, LLC and deeproot-GRD provides that deeproot-GRD is the Adviser s client and has given the Adviser discretionary authority to invest our funds as it sees fit in accordance with our investment objectives. For those advisory services, the Adviser will earn an investment management fee equal to one percent (1%) per annum of the assets under management ( AUM ). The investment management fee will be payable on a periodic basis, of at least one payment each semiannual calendar period, based on the invoice of the Advisor and paid to deeproot-GRD. STRUCTURE, PRINCIPALS AND PERSONNEL The structure of the fund group is set forth in the below diagram providing transparency of the ownership, management, and organization managing our assets. Administration Structure & Fee deeproot Funds, LLC is managed by a Board of Managers. Currently, the sole Manager is deeproot Capital Management, LLC. deeproot Funds, LLC will be responsible for handling all administrative issues including: management of the offering, overseeing and executing asset transactions with the adviser, deeproot Advisory Services, LLC, handling investor relations and correspondence, dealing with renewals and withdrawals by Holders, interfacing with the Trustee on behalf of
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in the common stock. You should carefully read the entire prospectus, including "Risk Factors", "Management s Discussion and Analysis of Financial Condition and Results of Operations" and the Financial Statements, before making an investment decision. In this Prospectus, the terms "Readaboo," "Company," "we," "us" and "our" refer to Readaboo, Inc. Plan We are in the business of ebook subscriptions and marketing for independently published books. We maintain our website at www.readaboo.com. We plan to offer an ebook subscription to our customers for $4.99 per month which will entitle them to download up to 5 ebooks from our library of independently published titles and authors. We also plan to host book fair events across the country which will showcase independent authors and titles and will provide a venue for authors and readers to meet and interact with each other. The first of such book fairs is planned for the fourth quarter of 2014, and as of the date of this prospectus, the Company has sold exhibition slots to four authors for the book fair. We do not have written agreements with the four authors exhibiting at the book fair. The subscription service is called a "BookBunch" and we initially plan to offer titles in the Mystery/Thriller/Suspense, Science Fiction and Fantasy, and Contemporary Fiction genres. We believe that there is a market opportunity for independent, self published books, and it is our mission to help the large number of new self-published authors reach their audience of readers via our website and via our book fairs. We believe that independent authors will use our services to expand customer discovery and engagement. We initially plan to focus on building relationships with self-published authors in the United States, but will also look to international authors in the future including in Europe, Asia and India. We plan to develop relationships with independent publishers in order to expand the number of authors and titles on our platform. Ajay Tandon, our president and sole director, plans on devoting a minimum of ten hours per week to the Company. We have not yet generated any revenues. Several authors and one independent publisher with over 100 books in their portfolio have indicated an interest to sign such agreements with the company to join the BookBunch subscription service. As of the date of this Registration Statement, we have signed an agreement with one author but have not yet signed any agreements with any publishers to join the BookBunch subscription service. The Company, its sole officer and director, any promoters, and any affiliates of these persons do not plan to be acquired or merge with another company or enter into a change of control or similar transaction. We are not a blank check company. Rule 419 of Regulation C under the Securities Act of 1933 defines a "blank check company" as a (i) development stage company that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person, and (ii) is issuing a penny stock. Accordingly, we do not believe that our Company may be classified as a "blank check company" because we have devoted significant time in pursuit of a specific business plan and do not intend to engage in any merger or acquisition with an unidentified company or other entity. Our independent registered public accounting firm has expressed substantial doubt as to our ability to continue as a going concern. Where You Can Find Us We presently maintain our principal offices at 845 Third Avenue, 6th Floor, New York, New York 10022. Our telephone number is (646) 495-0939. Implications of Being an Emerging Growth Company We qualify as an emerging growth company as that term is used in the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include: A requirement to have only two years of audited financial statements and only two years of related MD Exemption from the auditor attestation requirement in the assessment of the emerging growth company s internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002; Reduced disclosure about the emerging growth company s executive compensation arrangements; and No non-binding advisory votes on executive compensation or golden parachute arrangements. We have already taken advantage of these reduced reporting burdens in this prospectus, which are also available to us as a smaller reporting company as defined under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities Act") for complying with new or revised accounting standards. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption. Management has not had an opportunity to determine the effects of the new revenue standard as of the date of this filing, but does not expect the new standard to have a material impact on our financial statements. We could remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. For more details regarding this exemption, see "Management s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies." The Offering Common stock offered by selling security holders 500,000 shares of common stock. This number represents 11% of our current outstanding common stock (1). Common stock outstanding before the offering 4,500,000 Common stock outstanding after the offering 4,500,000 Terms of the Offering The selling security holders will determine when and how they will sell the common stock offered in this prospectus. The selling security holders will sell at a fixed price of $0.02 per share. The offering price for all the shares being registered will remain fixed for the duration of the offering. Termination of the Offering The offering will conclude upon such time as all of the common stock has been sold pursuant to the registration statement. Trading Market There is currently no trading market for our common stock. We intend to apply soon for quotation on the OTC Markets. We will require the assistance of a market-maker to apply for quotation and there is no guarantee that a market-maker will agree to assist us. Use of proceeds We are not selling any shares of the common stock covered by this prospectus. As such, we will not receive any of the offering proceeds from the registration of the shares of common stock covered by this prospectus. Risk Factors The Common Stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See "Risk Factors" beginning on page 4. (1) Based on 4,500,000 shares of common stock outstanding as of the date of this Registration Statement. Summary of Financial Information The following summary financial data should be read in conjunction with "Management s Discussion and Analysis," "Plan of Operation" and the Financial Statements and Notes thereto, included elsewhere in this prospectus. The statement of operations and balance sheet data for the period ended September 30, 2014 are derived from our audited annual financial statements. The data set forth below should be read in conjunction with "Management s Discussion and Analysis of Financial Condition and Results of Operations," our financial statements and the related notes included in this prospectus. Statement of Operations: For the Six Months Ended September 30, 2014 Revenues $- Operating expenses $52,030 Loss from Operations $(52,030) Net Loss $(52,040) Net Loss Per Share – Basic and Diluted $(0.01) Weighted Average Number of Common Shares Outstanding - Basic and Diluted 4,500,000 Balance Sheet Data: As of September 30, 2014 Cash and cash equivalents $4,041 Total assets 4,041 Total current liabilities 23,809 Total stockholders' equity (19,768) Total Liabilities and Stockholders' Equity $4,041 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS The information contained in this report, including in the documents incorporated by reference into this report, includes some statement that are not purely historical and that are "forward-looking statements." Such forward-looking statements include, but are not limited to, statements regarding our and their management s expectations, hopes, beliefs, intentions or strategies regarding the future, including our financial condition, results of operations. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipates," "believes," "continue," "could," "estimates," "expects," "intends," "may," "might," "plans," "possible," "potential," "predicts," "projects," "seeks," "should," "would" and similar expressions, or the negatives of such terms, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. The forward-looking statements contained in this report are based on current expectations and beliefs concerning future developments and the potential effects on the parties and the transaction. There can be no assurance that future developments actually affecting us will be those anticipated. These that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, including the following forward-looking statements involve a number of risks, uncertainties (some of which are beyond the parties control) or other assumptions. RISK FACTORS The shares of our common stock being offered for resale by the selling security holders are highly speculative in nature, involve a high degree of risk and should be purchased only by persons who can afford to lose their entire amount invested in the common stock. Accordingly, prospective investors should carefully consider, along with other matters referred to herein, the following risk factors in evaluating our business before purchasing any Units. If any of the following risks actually occurs, our business, financial condition or operating results could be materially adversely affected. In such case, you may lose all or part of your investment. You should carefully consider the risks described below and the other information in this process before investing in our common stock. Risks Related to Our Business OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM HAS EXPRESSED SUBSTANTIAL DOUBT AS TO OUR ABILITY TO CONTINUE AS A GOING CONCERN. The audited financial statements included in the registration statement have been prepared assuming that we will continue as a going concern and do not include any adjustments that might result if we cease to continue as a going concern. We believe that in order to continue as a going concern, including the costs of being a public company, we will need $25,000 per year. We have incurred significant losses since our inception. We have funded these losses primarily through the sale of securities. Based on our financial history since inception, in their report on the financial statements for the period from September 11, 2013 (inception) to March 31, 2014, our independent registered public accounting firm has expressed substantial doubt as to our ability to continue as a going concern. Management believes the going concern has continued through September 30, 2014. We are a development stage company that has generated no revenue. There can be no assurance that we will have adequate capital resources to fund planned operations or that any additional funds will be available to us when needed or at all, or, if available, will be available on favorable terms or in amounts required by us. If we are unable to obtain adequate capital resources to fund operations, we may be required to delay, scale back or eliminate some or all of our operations, which may have a material adverse effect on our business, results of operations and ability to operate as a going concern. WE HAVE LIMITED OPERATING HISTORY AND FACE MANY OF THE RISKS AND DIFFICULTIES FREQUENTLY ENCOUNTERED BY DEVELOPMENT STAGE COMPANY. The Company was formed on September 11, 2013. Prior to that time, the Company had no operations upon which an evaluation of the Company and its prospects could be based. There can be no assurance that management of the Company will be successful in completing the Company s business development with self-published authors and independent publishers, implementing the corporate infrastructure to support operations at the levels called for by the Company s business plan, devise a marketing plan to successfully reach authors and readers for our ebook subscription and marketing services or that the Company will generate sufficient revenues to meet its expenses or to achieve or maintain profitability. If we are unable to raise capital as needed, we are required to reduce the scope of our business development activities, which could harm our business plans, financial condition and operating results, or cease our operations entirely, in which case, you will lose all your investment. THERE MAY NOT BE A WIDE ENOUGH CLIENT BASE TO SUSTAIN OUR BUSINESS. The Company s principal business is to engage in ebook subscription and marketing services. The Company hopes to reach authors and readers who are willing and able to utilize our services and it may be difficult to find these readers in numbers large enough to make the business model work for profitability. WE MAY BE ACCUSED OF INFRINGING INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES. Other parties may claim that we infringe their proprietary rights. We may be subject to claims and legal proceedings regarding alleged infringement by us of the intellectual property rights of third parties. Such claims, whether or not meritorious, may result in the expenditure of significant financial and managerial resources, injunctions against us, or the payment of damages. We may need to obtain licenses from third parties who allege that we have infringed their rights, but such licenses may not be available on terms acceptable to us or at all. In addition, we may not be able to obtain or utilize on terms that are favorable to us, or at all, licenses or other rights with respect to intellectual property we do not own. Our digital content offerings depend in part on effective digital rights management technology to control access to digital content. If the digital rights management technology that we use is compromised or otherwise malfunctions, we could be subject to claims, and content providers may be unwilling to include their content in our service. OUR FUTURE SUCCESS IS DEPENDENT, IN PART, ON THE PERFORMANCE AND CONTINUED SERVICE OF AJAY TANDON, OUR PRESIDENT AND SOLE DIRECTOR. The Company will be dependent on its key executive, President and sole Director, Ajay Tandon, for the foreseeable future. The loss of the services from Ajay Tandon could have a material adverse effect on the operations and prospects of the Company. He is expected to handle all marketing and sales efforts and manage the operations. His responsibilities include developing business arrangements with self-published authors and independent publishers, directing the development of the company website, and formulating marketing materials to be used during his presentations and meetings. Another seasoned business manager with an interest in the ebook industry would be needed to run the Company if Ajay Tandon was no longer available. At this time, the Company does not have an employment agreement with Mr. Tandon, though the Company may enter into such an agreement with its president on terms and conditions usual and customary for its industry. The Company does not currently have "key man" life insurance on Mr. Tandon. Furthermore, our viable plan to continue to exist for the 12 months following effectiveness of the offering is based on further loans from Mr. Tandon, We do not have any written or oral commitment from our President to provide any amount of additional funding and he has no obligation to provide the Company with any additional funding. BECAUSE OUR SOLE OFFICER AND DIRECTOR IS INEXPERIENCED IN OPERATING A BUSINESS IN THE EBOOK INDUSTRY, OUR BUSINESS PLAN MAY FAIL. Our sole officer and director does not have any specific training in running an ebook business. With no direct technical training or experience in this area, management may not be fully aware of many of the specific requirements related to working within this industry. As a result, our management may lack certain skills that are advantageous in managing our company. Consequently, our operations, earnings, and ultimate financial success could suffer irreparable harm due to management s lack of experience in this industry. WE OPERATE IN A HIGHLY COMPETITIVE INDUSTRY AND COMPETE AGAINST SEVERAL LARGE COMPANIES WHICH COULD HARM OUR BUSINESS. There are numerous established companies that offer ebook subscription services including Amazon, Oyster Books and Scribd and which have far greater financial resources than we do. We are a new entry into this competitive market and may struggle to differentiate ourselves as a specialist that provides more value with respect to self-published books and authors than the competition. WE ARE AN "EMERGING GROWTH COMPANY," AND ANY DECISION ON OUR PART TO COMPLY ONLY WITH CERTAIN REDUCED DISCLOSURE REQUIREMENTS APPLICABLE TO "EMERGING GROWTH COMPANIES" COULD MAKE OUR COMMON STOCK LESS ATTRACTIVE TO INVESTORS. In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption. Management has not had an opportunity to determine the effects of the new revenue standard as of the date of this filing, but does not expect the new standard to have a material impact on our financial statements. WE ARE AN "EMERGING GROWTH COMPANY" UNDER THE RECENTLY ENACTED JOBS ACT AND WE CANNOT BE CERTAIN IF THE REDUCED DISCLOSURE REQUIREMENTS APPLICABLE TO EMERGING GROWTH COMPANIES WILL MAKE OUR COMMON STOCK LESS ATTRACTIVE TO INVESTORS. We qualify as an "emerging growth company" under the recently enacted JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, among other things, we will not be required to: have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; submit certain executive compensation matters to shareholder advisory votes, such as "say-on-pay" and "say-on-frequency"; obtain shareholder approval of any golden parachute payments not previously approved; and disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive s compensation to median employee compensation. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. We will remain an "emerging growth company" for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion; (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period. Until such time, however, because the JOBS Act has only recently been enacted, we cannot predict whether investors will find our stock less attractive because of the more limited disclosure requirements that we may be entitled to follow and other exemptions on which we are relying while we are an "emerging growth company". If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. BECAUSE OUR COMMON STOCK IS NOT REGISTERED UNDER THE EXCHANGE ACT, OUR REPORTING OBLIGATIONS UNDER SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, MAY BE SUSPENDED AUTOMATICALLY IF WE HAVE FEWER THAN 300 SHAREHOLDERS OF RECORD ON THE FIRST DAY OF OUR FISCAL YEAR AND AS A RESULT WE WILL HAVE LIMITED REPORTING DUTIES WHICH COULD MAKE OUR COMMON STOCK LESS ATTRACTIVE TO INVESTORS. Our common stock is not registered under the Exchange Act, and we do not intend to register our common stock under the Exchange Act for the foreseeable future (provided that, we will register our common stock under the Exchange Act if we have, after the last day of our fiscal year, $10,000,000 in total assets and either more than 2,000 shareholders of record or 500 shareholders of record who are not accredited investors (as such term is defined by the Securities and Exchange Commission), in accordance with Section 12(g) of the Exchange Act). As long as our common stock is not registered under the Exchange Act, our obligation to file reports under Section 15(d) of the Exchange Act will be automatically suspended if, on the first day of any fiscal year (other than a fiscal year in which a registration statement under the Securities Act has gone effective), we have fewer than 300 shareholders of record. This suspension is automatic and does not require any filing with the SEC. In such an event, we may cease providing periodic reports and current or periodic information, including operational and financial information, may not be available with respect to our results of operations. In addition, so long as our common shares are not registered under the Exchange Act, our directors and executive officers and beneficial holders of 10% or more of our outstanding common shares will not be subject to Section 16 of the Exchange Act. Section 16(a) of the Exchange Act requires executive officers and directs, and persons who beneficially own more than 10% of a registered class of equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of common shares and other equity securities, on Forms 3, 4 and 5, respectively. Such information about our directors, executive officers, and beneficial holders will only be available through this (and any subsequent) registration statement, and periodic reports we file thereunder. Furthermore, so long as our common shares are not registered under the Exchange Act, our obligation to file reports under Section 15(d) of the Exchange Act will be automatically suspended if, on the first day of any fiscal year (other than a fiscal year in which a registration statement under the Securities Act has gone effective), we have fewer than 300 shareholders of record. This suspension is automatic and does not require any filing with the SEC. In such an event, we may cease providing periodic reports and current or periodic information, including operational and financial information, may not be available with respect to our results of operations. OUR ARTICLES OF INCORPORATION PROVIDE FOR INDEMNIFICATION OF OFFICERS AND DIRECTORS AT OUR EXPENSE AND LIMIT THEIR LIABILITY WHICH MAY RESULT IN A MAJOR COST TO US AND HURT THE INTERESTS OF OUR SHAREHOLDERS BECAUSE CORPORATE RESOURCES MAY BE EXPENDED FOR THE BENEFIT OF OFFICERS AND/OR DIRECTORS. The Company s Certificate of Incorporation and By-Laws include provisions that eliminate the personal liability of the directors of the Company for monetary damages to the fullest extent possible under the laws of the State of Delaware or other applicable law. These provisions eliminate the liability of directors to the Company and its stockholders for monetary damages arising out of any violation of a director of his fiduciary duty of due care. Under Delaware law, however, such provisions do not eliminate the personal liability of a director for (i) breach of the director s duty of loyalty, (ii) acts or omissions not in good faith or involving intentional misconduct or knowing violation of law, (iii) payment of dividends or repurchases of stock other than from lawfully available funds, or (iv) any transaction from which the director derived an improper benefit. These provisions do not affect a director s liabilities under the federal securities laws or the recovery of damages by third parties. OUR KEY PERSONNEL MAY NOT PROVIDE MORE THAN TEN HOURS OF TIME PER WEEK TO OUR BUSINESS, WHICH MAY CAUSE OUR BUSINESS TO FAIL. Our future ability to execute our business plan depends upon the continued service of our executive officer, Ajay Tandon. Mr. Tandon has another job as a research analyst who provides equity research and corporate access services through his firm SeeThruEquity. Therefore, Mr. Tandon will be required to spend less than full-time with this venture and may be limited in the amount of time he can devote to the Company. However, he plans on devoting a minimum of ten hours per week to the Company. REPORTING REQUIREMENTS UNDER THE EXCHANGE ACT AND COMPLIANCE WITH THE SARBANES-OXLEY ACT OF 2002, INCLUDING ESTABLISHING AND MAINTAINING ACCEPTABLE INTERNAL CONTROLS OVER FINANCIAL REPORTING, ARE COSTLY AND MAY INCREASE SUBSTANTIALLY. The rules and regulations of the SEC require a public company to prepare and file periodic reports under the Exchange Act, which will require that the Company engage legal, accounting, auditing and other professional services. The engagement of such services is costly. Additionally, the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act") requires, among other things, that we design, implement and maintain adequate internal controls and procedures over financial reporting. The costs of complying with the Sarbanes-Oxley Act and the limited technically qualified personnel we have may make it difficult for us to design, implement and maintain adequate internal controls over financial reporting. We expect these costs to be approximately $25,000 per year. In the event that we fail to maintain an effective system of internal controls or discover material weaknesses in our internal controls, we may not be able to produce reliable financial reports or report fraud, which may harm our overall financial condition and result in loss of investor confidence and a decline in our share price. As a public company, we may be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Act of 2010 and other applicable securities rules and regulations. Despite recent reforms made possible by the JOBS Act, compliance with these rules and regulations will nonetheless increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources, particularly after we are no longer an "emerging growth company." The Exchange Act requires, among other things, that we file annual, quarterly, and current reports with respect to our business and operating results. We are working with our legal, independent accounting and financial advisors to identify those areas in which changes should be made to our financial and management control systems to manage our growth and our obligations as a public company. These areas include corporate governance, corporate control, disclosure controls and procedures and financial reporting and accounting systems. We have made, and will continue to make, changes in these and other areas. However, we anticipate that the expenses that will be required in order to adequately prepare for being a public company could be material. We estimate that the aggregate cost of increased legal services; accounting and audit functions; personnel, such as a chief financial officer familiar with the obligations of public company reporting; consultants to design and implement internal controls; and financial printing alone will be a few hundred thousand dollars per year and could be several hundred thousand dollars per year. In addition, if and when we retain independent directors and/or additional members of senior management, we may incur additional expenses related to director compensation and/or premiums for directors and officers liability insurance, the costs of which we cannot estimate at this time. We may also incur additional expenses associated with investor relations and similar functions, the cost of which we also cannot estimate at this time. However, these additional expenses individually, or in the aggregate, may also be material. In addition, being a public company could make it more difficult or more costly for us to obtain certain types of insurance, including directors and officers liability insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as executive officers. The increased costs associated with operating as a public company may decrease our net income or increase our net loss, and may cause us to reduce costs in other areas of our business or increase the prices of our products or services to offset the effect of such increased costs. Additionally, if these requirements divert our management s attention from other business concerns, they could have a material adverse effect on our business, financial condition and results of operations. IF WE ARE NOT ABLE TO IMPLEMENT THE REQUIREMENTS OF SECTION 404 OF THE SARBANES-OXLEY ACT IN A TIMELY MANNER OR WITH ADEQUATE COMPLIANCE, WE MAY BE SUBJECT TO SANCTIONS BY REGULATORY AUTHORITIES. Section 404 of the Sarbanes-Oxley Act requires that we evaluate and determine the effectiveness of our internal controls over financial reporting and, beginning with our annual report for fiscal year 2013, provide a management report on the internal control over financial reporting. We are in the preliminary stages of seeking consultants to assist us with a review of our existing internal controls and the design and implementation of additional internal controls that we may determine are appropriate. If we have a material weakness in our internal control over financial reporting, we may not detect errors on a timely basis and our financial statements may be materially misstated. We will be evaluating our internal controls systems to allow management to report on, and eventually allow our independent auditors to attest to, our internal controls. We will be performing the system and process evaluation and testing (and any necessary remediation) required to comply with the management certification requirements of Section 404 of the Sarbanes-Oxley Act of 2002. We cannot be certain as to the timing of completion of our evaluation, testing and remediation actions or the impact of the same on our operations. If we are not able to implement the requirements of Section 404 in a timely manner or with adequate compliance, we may be subject to sanctions or investigation by regulatory authorities, such as the SEC or a stock exchange on which our securities may be listed in the future. Any such action could adversely affect our financial results or investors confidence in us and could cause our stock price to fall. Moreover, if we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered public accounting firm identifies deficiencies in our internal controls that are deemed to be material weaknesses, we could be subject to sanctions or investigations by the SEC, any stock exchange on which our securities may be listed in the future, or other regulatory authorities, which would entail expenditure of additional financial and management resources and could materially adversely affect our stock price. Inferior internal controls could also cause us to fail to meet our reporting obligations or cause investors to lose confidence in our reported financial information, which could have a negative effect on our stock price. To date, we have not evaluated the effectiveness of our internal controls over financial reporting, or the effectiveness of our disclosure controls and procedures, and we will not be required to evaluate our internal controls over financial reporting or disclose the results of such evaluation until the filing of our second annual report. Any such deficiencies, weaknesses or lack of compliance could have a materially adverse effect on our ability to comply with the reporting requirements of the Securities Exchange Act of 1934 which is necessary to maintain our public company status. If we were to fail to fulfill those obligations, our ability to continue as a U.S. public company would be in jeopardy in which event an investor could lose his entire investment in our company. Risks Related to Our Common Stock THERE IS NO ASSURANCE OF A PUBLIC MARKET OR THAT OUR COMMON STOCK WILL EVER TRADE ON A RECOGNIZED EXCHANGE. THEREFORE, YOU MAY BE UNABLE TO LIQUIDATE YOUR INVESTMENT IN OUR STOCK. There is no established public trading marketing for our Common Stock and there can be no assurance that one will ever develop. Market liquidity will depend on the perception of our operating business and any steps that our management might take to bring us to the awareness of investors. There can be no assurance given that there will be any awareness generated. Consequently, investors may not be able to liquidate their investment or liquidate it at a price that reflects the value of the business. As a result holders of our securities may not find purchasers for our securities should they to sell securities held by them. Consequently, our securities should be purchased only by investors having no need for liquidity in their investment and who can hold our securities for an indefinite period of time. WE MAY NEVER PAY ANY DIVIDENDS TO SHAREHOLDERS. We currently intend to retain any future earnings for use in the operation and expansion of our business. Accordingly, we do not expect to pay any dividends in the foreseeable future, but will review this policy as circumstances dictate. YOU WILL EXPERIENCE DILUTION OF YOUR OWNERSHIP INTEREST BECAUSE OF THE FUTURE ISSUANCE OF ADDITIONAL SHARES OF OUR COMMON STOCK AND OUR PREFERRED STOCK. In the future, we may issue our authorized but previously unissued equity securities, resulting in the dilution of the ownership interests of our present stockholders. We are authorized to issue an aggregate of 30,000,000 shares of common stock, par value $0.0001 per share, of which 4,500,000 are currently outstanding. We may also issue additional shares of our common stock or other securities that are convertible into or exercisable for common stock in connection with hiring or retaining employees or consultants, future acquisitions, future sales of our securities for capital raising purposes, or for other business purposes. The future issuance of any such additional shares of our common stock or other securities may create downward pressure on the trading price of our common stock. There can be no assurance that we will not be required to issue additional shares, warrants or other convertible securities in the future in conjunction with hiring or retaining employees or consultants, future acquisitions, future sales of our securities for capital raising purposes or for other business purposes, including at a price (or exercise prices) below the price at which shares of our common stock will be quoted on the OTC Markets. IN THE EVENT A MARKET DEVELOPS FOR OUR COMMON STOCK, THE MARKET PRICE OF OUR COMMON STOCK MAY BE VOLATILE. In the event a market develops for our common stock, the market price of our common stock may be highly volatile, as is the stock market in general, and the market for OTC Markets quoted stocks in particular. Some of the factors that may materially affect the market price of our Common Stock are beyond our control, such as changes in financial estimates by industry and securities analysts, conditions or trends in the industry in which we operate or sales of our common stock. These factors may materially adversely affect the market price of our common stock, regardless of our performance. In addition, the public stock markets have experienced extreme price and trading volume volatility. This volatility has significantly affected the market prices of securities of many companies for reasons frequently unrelated to the operating performance of the specific companies. These broad market fluctuations may adversely affect the market price of our common stock. THE OFFERING PRICE OF THE COMMON STOCK WAS DETERMINED BASED ON THE PRICE OF OUR PRIVATE OFFERING, AND THEREFORE SHOULD NOT BE USED AS AN INDICATOR OF THE FUTURE MARKET PRICE OF THE SECURITIES. THEREFORE, THE OFFERING PRICE BEARS NO RELATIONSHIP TO OUR ACTUAL VALUE, AND MAY MAKE OUR SHARES DIFFICULT TO SELL. Since our shares are not listed or quoted on any exchange or quotation system, the offering price of $0.02 per share for the shares of common stock was determined based on the price of our private offering. The facts considered in determining the offering price were our financial condition and prospects, our limited operating history and the general condition of the securities market. The offering price bears no relationship to the book value, assets or earnings of our company or any other recognized criteria of value. The offering price should not be regarded as an indicator of the future market price of the securities. OUR COMMON STOCK IS CONSIDERED A PENNY STOCK, WHICH MAY BE SUBJECT TO RESTRICTIONS ON MARKETABILITY, SO YOU MAY NOT BE ABLE TO SELL YOUR SHARES. We may be subject now and in the future to the SEC s "penny stock" rules if our shares of Common Stock sell below $5.00 per share. Penny stocks generally are equity securities with a price of less than $5.00. The penny stock rules require broker-dealers to deliver a standardized risk disclosure document prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson, and monthly account statements showing the market value of each penny stock held in the customer s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information must be given to the customer orally or in writing prior to completing the transaction and must be given to the customer in writing before or with the customer s confirmation. In addition, the penny stock rules require that prior to a transaction, the broker dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser s written agreement to the transaction. The penny stock rules are burdensome and may reduce purchases of any offerings and reduce the trading activity for shares of our Common Stock. As long as our shares of Common Stock are subject to the penny stock rules, the holders of such shares of Common Stock may find it more difficult to sell their securities. THE CONCENTRATION OF OWNERSHIP OF OUR SECURITIES BY OUR CONTROLLING STOCKHOLDER CAN RESULT IN STOCKHOLDER VOTES THAT ARE NOT IN OUR BEST INTERESTS OR THE BEST INTERESTS OF OUR MINORITY STOCKHOLDERS. Mr. Ajay Tandon owns approximately 88.89% of our outstanding voting securities, giving him controlling interest in the Company. Accordingly, Mr. Tandon has substantial control over all strategic and operational aspects of the Company s business. As a result, Mr. Tandon will have the ability to control substantially all matters submitted to our stockholders for approval, including: election of our board of directors; removal of any of our directors; amendment of our articles of incorporation or bylaws; and adoption of measures that could delay or prevent a change in control or impede a merger, takeover or other business combination involving us. The approval of our directors and executive officers will be required to affect all matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions. In addition, sales of significant amounts of shares held by our directors and executive officers, or the prospect of these sales, could adversely affect the market price of our common stock. Mr. Tandon s stock ownership may discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of us, which in turn could reduce our stock price or prevent our stockholders from realizing a premium over our stock price. We cannot assure you that the interests of our management team will coincide with the interests of the investors. So long as our management team collectively controls a significant portion of our common stock, these individuals, or entities controlled by them, will continue to collectively be able to strongly influence or effectively control our decisions. USE OF PROCEEDS We will not receive any proceeds from the sale of common stock by the selling security holders. All of the net proceeds from the sale of our common stock will go to the selling security holders as described below in the sections entitled "Selling Security Holders" and "Plan of Distribution". We have agreed to bear the expenses relating to the registration of the common stock for the selling security holders. DETERMINATION OF OFFERING PRICE Since our common stock is not listed or quoted on any exchange or quotation system, the offering price of the shares of common stock was determined by the price of the common stock that was sold to our security holders pursuant to an exemption under Regulation S promulgated under the Securities Act. The offering price of the shares of our common stock does not necessarily bear any relationship to our book value, assets, past operating results, financial condition or any other established criteria of value. The facts considered in determining the offering price were our financial condition and prospects, our limited operating history and the general condition of the securities market. Although our common stock is not listed on a public exchange, we will be filing to obtain a quotation on the OTC Markets concurrently with the filing of this prospectus. In order to be quoted on the OTC Markets, a market maker must file an application on our behalf in order to make a market for our common stock. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Markets, nor can there be any assurance that such an application for quotation will be approved. In addition, there is no assurance that our common stock will trade at market prices in excess of the initial offering price as prices for the common stock in any public market which may develop will be determined in the marketplace and may be influenced by many factors, including the depth and liquidity. DILUTION The Common Stock to be sold by the selling shareholders as provided in the "Selling Security Holders" section is common stock that is currently issued. Accordingly, there will be no dilution to our existing shareholders. SELLING SECURITY HOLDERS The shares of Common Stock being offered for resale by the selling security holders consist of 500,000 shares of our common stock held by 31 shareholders. Such shareholders include the holders of 500,000 shares sold in our private offering pursuant to Regulation S promulgated under the Securities Act, sold through March 2014 at an offering price of $0.02 per share. The following table sets forth the names of the selling security holders, the number of shares of common stock beneficially owned by each of the selling stockholders as of the date of our registration statement, of which this prospectus is a part, and the number of shares of common stock being offered by the selling stockholders. The shares being offered hereby are being registered to permit public secondary trading, and the selling stockholders may offer all or part of the shares for resale from time to time. However, the selling stockholders are under no obligation to sell all or any portion of such shares nor are the selling stockholders obligated to sell any shares immediately upon effectiveness of this prospectus. All information with respect to share ownership has been furnished by the selling stockholders. Name Shares Beneficially Owned Prior to Offering Shares to be Offered Amount Beneficially Owned After Offering Percent Beneficially Owned After Offering(1) Adi Kedia 12,500 12,500 0 0% Ajit Mehta 12,500 12,500 0 0% Akshay Mani 12,500 12,500 0 0% Amrish Shah 12,500 12,500 0 0% Anil Dewan 12,500 12,500 0 0% Arun Kuman 12,500 12,500 0 0% Asha Rajagopalan 12,500 12,500 0 0% Ashok Bither 25,000 25,000 0 0% Deepak Khandelwal 12,500 12,500 0 0% Gaurav Garoo 25,000 25,000 0 0% Gaurav Vora 12,500 12,500 0 0% Jeet Alang 25,000 25,000 0 0% Kapil Shah 12,500 12,500 0 0% Parmila Bither 25,000 25,000 0 0% Prabhu Kumar 12,500 12,500 0 0% Raj Garoo 25,000 25,000 0 0% Raj Gupta 12,500 12,500 0 0% Rakesh Malhotra 12,500 12,500 0 0% Sameer Kaura 25,000 25,000 0 0% Sanju Singh 25,000 25,000 0 0% Sarita Sharma 12,500 12,500 0 0% Shiv Rajagopalan 12,500 12,500 0 0% Simran Alang 25,000 25,000 0 0% Sri Reddy 12,500 12,500 0 0% Sunil Kapoor 12,500 12,500 0 0% Sunita Rao 12,500 12,500 0 0% Suresh Malhotra 12,500 12,500 0 0% Surinder Dang 12,500 12,500 0 0% Varun Sharma 12,500 12,500 0 0% Vikram Rao 12,500 12,500 0 0% Virmila Shah 25,000 25,000 0 0% TOTAL 500,000 500,000 0 0% (1) Based on 4,500,000 shares outstanding as of the date of this Registration Statement. There are no agreements between the company and any selling shareholder pursuant to which the shares subject to this registration statement were issued. None of the selling shareholders or their beneficial owners: - has had a material relationship with us other than as a shareholder at any time within the past three years; or - has ever been one of our officers or directors or an officer or director of our predecessors or affiliates - are broker-dealers or affiliated with broker-dealers. PLAN OF DISTRIBUTION The selling security holders may sell some or all of their shares at a fixed price of $0.02 per share. Prior to being quoted on the OTC Markets, shareholders may sell their shares in private transactions to other individuals. Although our common stock is not listed on a public exchange, we will be filing to obtain a quotation on the OTC Markets concurrently with the filing of this prospectus. In order to be quoted on the OTC Markets, a market maker must file an application on our behalf in order to make a market for our common stock. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Markets, nor can there be any assurance that such an application for quotation will be approved. However, sales by selling security holder must be made at the fixed price of $0.02. The offering price for all the shares being registered will remain fixed for the duration of the offering. The selling security holders are "underwriters" within the meaning of the Securities Act of 1933, as amended, with respect to the shares being offered by them. Section 4(1) of the Securities Act exempts "transactions by any person other than an issuer, underwriter, or dealer" from the registration requirements of the Act. The term "underwriter" is defined in Section 2(11) of the Securities Act as "any person who has purchased from an issuer with a view to, or offers or sells for an issuer in connection with, the distribution of any security, or participates or has a direct or indirect participation in any such undertaking, or participates or has a participation in the direct or indirect underwriting of any such undertaking." Once a market has developed for our common stock, the shares may be sold or distributed from time to time by the selling stockholders, who are deemed to be underwriters, directly to one or more purchasers or through brokers or dealers who act solely as agents, at market prices prevailing at the time of sale, at prices related to such prevailing market prices, at negotiated prices or at fixed prices, which may be changed. The distribution of the shares may be effected in one or more of the following methods: ordinary brokers transactions, which may include long or short sales, transactions involving cross or block trades on any securities or market where our common stock is trading, market where our common stock is trading, through direct sales to purchasers or sales effected through agents, through transactions in options, swaps or other derivatives (whether exchange listed of otherwise), or exchange listed or otherwise), or any combination of the foregoing. In addition, the selling stockholders may enter into hedging transactions with broker-dealers who may engage in short sales, if short sales were permitted, of shares in the course of hedging the positions they assume with the selling stockholders. The selling stockholders may also enter into option or other transactions with broker-dealers that require the delivery by such broker-dealers of the shares, which shares may be resold thereafter pursuant to this prospectus. None of the selling security holders are broker-dealers or affiliates of broker dealers. We will advise the selling security holders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling security holders and their affiliates. In addition, we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the selling security holders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling security holders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act. Brokers, dealers, or agents participating in the distribution of the shares may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of shares for whom such broker-dealers may act as agent or to whom they may sell as principal, or both (which compensation as to a particular broker-dealer may be in excess of customary commissions). Neither the selling stockholders nor we can presently estimate the amount of such compensation. We know of no existing arrangements between the selling stockholders and any other stockholder, broker, dealer or agent relating to the sale or distribution of the shares. We will not receive any proceeds from the sale of the shares of the selling security holders pursuant to this prospectus. We have agreed to bear the expenses of the registration of the shares, including legal and accounting fees, and such expenses are estimated to be approximately $46,000. Notwithstanding anything set forth herein, no FINRA member will charge commissions that exceed 8% of the total proceeds of the offering. DESCRIPTION OF SECURITIES TO BE REGISTERED General We are authorized to issue an aggregate number of 30,000,000 shares of common stock, $0.0001 par value per share. Common Stock We are authorized to issue 30,000,000 shares of common stock, $0.0001 par value per share. Currently we have 4,500,000 shares of common stock issued and outstanding. Each share of common stock shall have one (1) vote per share for all purpose. Our common stock does not provide a preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights. Our common stock holders are not entitled to cumulative voting for election of Board of Directors. Dividends We have not paid any cash dividends to our shareholders. The declaration of any future cash dividends is at the discretion of our board of directors and depends upon our earnings, if any, our capital requirements and financial position, our general economic conditions, and other pertinent conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in our business operations. Warrants There are no outstanding warrants to purchase our securities. Options There are no outstanding options to purchase our securities. Transfer Agent and Registrar Currently we do not have a stock transfer agent. However, upon filing our Registration Statement, of which this Prospectus is a part, we do intend to engage a transfer agent to issue physical certificates to our shareholders. Interests of Named Experts and Counsel No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee. Szaferman, Lakind, Blumstein & Blader, P.C. located at 101 Grovers Mill Road, Suite 200, Lawrenceville, NJ 08648 will pass on the validity of the common stock being offered pursuant to this registration statement. The financial statements as of March 31, 2014 and for the period from September 11, 2013 (inception) to March 31, 2014 included in this prospectus and the registration statement have been audited by DKM Certified Public Accountants, an independent registered public accounting firm, to the extent and for the periods set forth in their report appearing elsewhere herein and in the registration statement, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting. DESCRIPTION OF BUSINESS Overview Readaboo, LLC. was incorporated under the laws of the State of Delaware on September 11, 2013. Readaboo, LLC is a wholly owned subsidiary of Readaboo, Inc., which was incorporated under the laws of the State of Delaware on February 24, 2014. We are in the business of ebook subscriptions and marketing for independently published books. We maintain our website at www.readaboo.com . We plan to offer an ebook subscription to our customers for $4.99 per month which will entitle them to download up to 5 ebooks from our library of independently published titles and authors. We also plan to host book fair events across the country which will showcase independent authors and titles and will provide a venue for authors and readers to meet and interact with each other. The first of such book fairs is planned for the fourth quarter of 2014, and as of the date of this prospectus, the Company has sold exhibition slots to four authors for the book fair. We do not have written agreements with the four authors exhibiting at the book fair. We are currently a development stage company. We have not formed any material relationships or entered into any agreements with self-published authors or independent publishers. We do not currently engage in any business activities that provide cash flow. We may require additional capital to implement our business and fund our operations. See "Management s Discussion and Analysis" on page 18. The Company s fiscal year end is March 31. The Company s principal executive office and mailing address is 845 Third Avenue, 6th Floor, New York, New York 10022. Our telephone number is (646) 495-0939. Our Business Our subscription service is called a "BookBunch" and we initially plan to offer titles in the Mystery/Thriller/Suspense, Science Fiction and Fantasy and Contemporary Fiction genres. We believe that there is a market opportunity for independent, self published books, and it is our mission to help the large number of new self-published authors reach their audience of readers via our website and via our book fairs. We believe that independent authors will use our services to expand customer discovery and engagement. We initially plan to focus on building relationships with self-published authors in the United States, but will also look to international authors in the future including in Europe, Asia and India. We plan to develop relationships with independent publishers in order to expand the number of authors and titles on our platform. We plan to do our first book fair in New York City in the fourth quarter of 2014, and invite self-published authors to set up booths in order to introduce their books to readers who attend the fair. We plan to charge $499 to each author for a six foot table at the book fair for book signings. We also will negotiate a percentage of the sales which the author consummates at the book fair. As of the date of this prospectus, the Company has sold exhibition slots to four authors for its first book fair. We do not have written agreements with the four authors exhibiting at the book fair. We expect to generate revenue from sales of our subscription service to our customers for $4.99 per month. We plan to pay authors a royalty of 70% of the pro rata cost of the book sold as part of a particular BookBunch. For example, if a subscriber chooses a package that includes one book with a retail price of $2.99, and four books with a retail price of $1.99, the $2.99 author would receive a royalty of $0.95, calculated as follows: $2.99 [retail price] /$10.95[sum of retail prices of the 5 books chosen] = 0.273 0.273 x $4.99 [subscription price] = $1.36 x 70% royalty= $0.95. In addition, we plan to generate revenues from the book fairs through sales of booths to authors and a percentage of sales of books sold at our events, such percentage to be negotiated with each respective author. The Company has devoted significant time to pursue its business plan, research the ebook market and competition, develop contact lists of self-published authors, develop contact lists of independent publishers and research the relevant industry organizations for self-published authors. In addition, the Company hired an attorney specializing in the publishing industry to draft two separate publishing agreements which the company can enter into with authors and publishers to govern the relationship between such author or publisher that agrees to join the Company BookBunch subscription service. Several authors and one independent publisher with over 100 books in their portfolio have indicated an interest to sign such agreements with the company to join the BookBunch subscription service. As of the date of this Registration Statement, we have signed an agreement with one author but have not yet signed any agreements with any publishers to join the BookBunch subscription service. The Company also has developed a beta website, and the sole director and president has spent significant amounts of time designing and developing the website as he has experience in web design and development. Finally, the Company has also investigated various venues in which to hold the Company s first book fair for self-published authors, and has contacted numerous authors which the Company believes may be potential customers for the book fair offering of the Company. As of the date of this prospectus, the Company has sold exhibition slots to four authors for the book fair. We do not have written agreements with the four authors exhibiting at the book fair. Target Market Our target market for our subscription service is avid readers which we believe are generally defined in the industry as readers who read more than one book per month. Marketing and Sales At this early stage of our operation, our President and sole Director is expected to handle all marketing and sales efforts. His responsibilities include developing business arrangements with self-published authors and independent publishers, directing the development of the company website, and formulating marketing materials to be used during his presentations and meetings. We plan to enter the market by developing relationships with self-published authors. We have developed an informational website that promotes our services and provides a contact function that allows prospects to email us to be considered for inclusion in our BookBunch subscription library. We also plan to develop relationships with independent publishers that may have contacts with self-published authors. We intend to develop relationships with self-published authors as follows: direct email marketing and contacting independent publishers and organizations of writers such as the National Writers Union and Self-Publishers Association in order to solicit authors to join our BookBunch platform and/or participate in our book fairs. We do not intend to promote our informational website—we say that "we have developed an information website that promotes our services" which include the BookBunch subscription service and our book fairs. We also plan to target organizations of writers such as the National Writers Union and the Self-Publishers Association. Our plan is to arrange meetings and presentations to promote our services to members of such organizations. Currently, we have a functioning website, www.readaboo.com, and we have begun accepting information inquiries via email. We may develop a blog to promote our services. We plan to introduce the blog via emails to opt-in prospects. Competition There are a number of companies and organizations that offer ebook subscription and marketing services to authors. We plan to differentiate ourselves by focusing on the self-published authors and not authors who are working with the Big Five publishing houses. The companies that are in the ebook market include: Amazon, Smashwords, Oyster Books, Scribd, Lulu and BookBaby. Employees We presently have no employees apart from our sole officer and director. Our sole officer and director devotes about 10 hours per week to our affairs. DESCRIPTION OF PROPERTY Our principal executive office is located at 845 Third Avenue, 6 th Floor, New York, NY 10022, and our telephone number is (646) 495-0939. There is no lease on the premises the Company is occupying and the Company is not responsible for paying rent. As we are not generating sufficient revenue at this time to justify a separate corporate office, the principal executive office is also the office of our president and sole director s other business, SeeThruEquity. Once our business grows and generates revenue, we will look for more office space in a separate corporate office. LEGAL PROCEEDINGS From time to time, we may become involved in various lawsuits and legal proceedings, which arise, in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition or operating results. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS There is presently no public market for our shares of common stock. We anticipate applying for quoting of our common stock on the OTC Markets upon the effectiveness of the registration statement of which this prospectus forms apart. However, we can provide no assurance that our shares of common stock will be quoted on the OTC Markets or, if quoted, that a public market will materialize. Holders of Capital Stock As of the date of this registration statement, we had 32 holders of our common stock. Rule 144 Shares As of the date of this registration statement, we do not have any shares of our common stock that are currently available for sale to the public in accordance with the volume and trading limitations of Rule 144. Stock Option Grants We do not have a stock option plan in place and have not granted any stock options at this time. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS The following plan of operation provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition. The discussion should be read along with our financial statements and notes thereto. This section includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our predictions. Plan of Operations We have commenced limited operations and our proposed business plan is not yet fully operational. We are finalizing our business plan and working to obtain our first client but have not yet engaged any clients. We are in the business of ebook subscriptions and marketing for independently published books. We maintain our website at www.readaboo.com . We plan to offer an ebook subscription to our customers for $4.99 per month which will entitle them to download up to 5 ebooks from our library of independently published titles and authors. We also plan to host book fair events across the country which will showcase independent authors and titles and will provide a venue for authors and readers to meet and interact with each other. The first of such book fairs is planned for the fourth quarter of 2014, and as of the date of this prospectus, the Company has sold exhibition slots to four authors for the book fair. We do not have written agreements with the four authors exhibiting at the book fair. The subscription service is called a "BookBunch" and we initially plan to offer titles in the Mystery/Thriller/Suspense, Science Fiction and Fantasy and Contemporary Fiction genres. We believe that there is a market opportunity for independent, self published books, and it is our mission to help the large number of new self-published authors reach their audience of readers via our website and via our book fairs. We believe that independent authors will use our services to expand customer discovery and engagement. We initially plan to focus on building relationships with self-published authors in the United States, but will also look to international authors in the future including in Europe, Asia and India. We plan to develop relationships with independent publishers in order to expand the number of authors and titles on our platform. We plan to do our first book fair in New York City in the fourth quarter of 2014, and invite self-published authors to set up booths in order to introduce their books to readers who attend the fair. We plan to charge $499 to each author for a six foot table at the book fair for book signings. We also will negotiate a percentage of the sales which the author consummates at the book fair. As of the date of this prospectus, the Company has sold exhibition slots to four authors for its first book fair. We do not have written agreements with the four authors exhibiting at the book fair. We expect to generate revenue from sales of our subscription service to our customers for $4.99 per month. We plan to pay authors a royalty of 70% of the pro rata cost of the book sold as part of a particular BookBunch. For example, if a subscriber chooses a package that includes one book with a retail price of $2.99, and four books with a retail price of $1.99, the $2.99 author would receive a royalty of $0.95, calculated as follows: $2.99 [retail price] /$10.95[sum of retail prices of the 5 books chosen] = 0.273 0.273 x $4.99 [subscription price] = $1.36 x 70% royalty= $0.95. In addition, we plan to generate revenues from the book fairs through sales of booths to authors and a percentage of sales of books sold at our events, such percentage to be negotiated with each respective author. By March 2015, we plan to contact authors who are self-published to establish relationships whereby they join our subscription service library as well as agree to participate in our book fair events. We have begun contacting self-published authors to gauge their interest in joining our subscription service library. Several authors and one independent publisher have indicated an interest in joining our subscription service platform. As of the date of this Registration Statement, we have signed an agreement with one author but have not yet signed any agreements with any publishers to join the BookBunch subscription service. In the next six months, we will reach out to more authors to ascertain their interest in our services and present our company to them if so desired. We are a development stage company, and to date, our development efforts have been focused primarily on the development and marketing of our business model. In addition, to date we have limited operating history for investors to evaluate the potential of our business development. As such, we have not built our customer base or our brand name. In addition, our sources of cash are not adequate for the next 12 months of operations. If we are unable to raise additional cash, we will either have to suspend or cease our expansion plans entirely. Limited Operating History We have generated no independent financial history and have not previously demonstrated that we will be able to expand our business. Our business is subject to risks inherent in growing an enterprise, including limited capital resources and possible rejection of our business model and/or sales methods. Critical Accounting Policies and Estimates While our significant accounting policies are more fully described in Note 1 to our financial statements for the period ended September 30, 2014 we believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating this management discussion and analysis. Our financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We continually evaluate our estimates, including those related to bad debts, recovery of long-lived assets, income taxes, and the valuation of equity transactions. We base our estimates on historical experience and on various other assumptions that we believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Any future changes to these estimates and assumptions could cause a material change to our reported amounts of revenues, expenses, assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of the financial statements. Basis of Presentation and Organization Readaboo, LLC. (a development stage company) was incorporated under the laws of the State of Delaware on September 11, 2013. Readaboo, LLC is a wholly owned subsidiary of Readaboo, Inc. Readaboo, Inc. (a development stage company) was incorporated under the laws of the State of Delaware on February 24, 2014. Collectively, Readaboo, LLC and Readaboo, Inc, makeup the consolidated company as of September 11, 2013 (date of inception). Development Stage As a development stage enterprise, the Company discloses the deficit accumulated during the development stage and the cumulative statements of operations and cash flows from inception to the current balance sheet date. Cash and Cash Equivalents For purposes of reporting within the statement of cash flows, the Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents. Revenue Recognition The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, "Revenue Recognition". In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. The Company intends to launch an ebook subscription service for $4.99 per month in which the customer can pick the titles they want from a group of ebooks from the very newest and best self-published authors with which the company may strike publishing deals. The Company also intends to host old-fashioned book fairs across the country where you can meet new authors and hear what they have to say about their books, in addition to mingling with like-minded readers. These book fairs are intended to fun-filled events with lots of giveaways and activities catered to the passionate reader who wants to discover new and exciting books that are not in the traditional limelight. The Company intends to charge authors a fee of $499 (per author) to present at a book fair. READABOO, INC AND SUBSIDIARY CONTENTS PAGE F-2 CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2014 (UNAUDITED) AND MARCH 31, 2014 PAGE F-3 CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2014 (UNAUDITED) AND THE PERIOD FROM SEPTEMBER 11, 2013 (INCEPTION) TO SEPTEMBER 30, 2013 (UNAUDITED) PAGE F-4 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY FOR THE PERIOD FROM SEPTEMBER 11, 2013 (INCEPTION) TO SEPTEMBER 30, 2014 PAGE F-5 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2014 (UNAUDITED) AND THE PERIOD FROM SEPTEMBER 11, 2013 (INCEPTION) TO SEPTEMBER 30 , 2013 (UNAUDITED) PAGES F6 - F11 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) F - 1 Loss per Common Share Basic loss per share is computed by dividing the net loss attributable to the common stockholders by the weighted average number of shares of common stock outstanding during the period. Fully diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. There were no dilutive financial instruments issued or outstanding for the period from September 11, 2013 (Inception) to September 30, 2014. Income Taxes Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized. The Company accounts for income taxes under the provisions of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 740, "Accounting for Income Taxes. It prescribes a recognition threshold and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. As a result, the Company has applied a more-likely-than-not recognition threshold for all tax uncertainties. The guidance only allows the recognition of those tax benefits that have a greater than 50% likelihood of being sustained upon examination by the various taxing authorities. The Company is subject to taxation in the United States. All of the Company s tax years since inception remain subject to examination by Federal and state jurisdictions. The Company classifies penalties and interest related to unrecognized tax benefits as income tax expense in the Statements of Operations. Fair Value of Financial Instruments The Company estimates the fair value of financial instruments using the available market information and valuation methods. Considerable judgment is required in estimating fair value. Accordingly, the estimates of fair value may not be indicative of the amounts the Company could realize in a current market exchange. As of March 31, 2014, the carrying value of loans from the CEO approximated fair value due to the short-term nature and maturity of these instruments. Estimates The financial statements are prepared on the basis of accounting principles generally accepted in the United States. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, and revenues and expenses for the period from September 11, 2013 (Inception) to September 30, 2014. Actual results could differ from those estimates made by management. Recent Accounting Pronouncements Under the JOBS Act, emerging growth companies can also delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption. Management has not had an opportunity to determine the effects of the new revenue standard as of the date of this filing, but does not expect the new standard to have a material impact on our financial statements. Readaboo, Inc. and Subsidiary Consolidated Balance Sheets September 30, 2014 March 31, 2014 (Unaudited) ASSETS Current Assets Cash $4,041 $7,914 Current and Total Assets $4,041 $7,914 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts payable and accrued expenses $19,099 $- Note payable - related party 2,599 1,599 Accrued Interest Payable - related party 111 43 Loan payable Deferred Revenue 2,000 - Current and Total Liabilities 23,809 1,642 Commitments and Contingencies Stockholders' Equity /(Deficiency) Common stock, $0.0001 par value; 30,000,000 shares authorized, 4,500,000 shares issued and outstanding 450 450 Additional paid-in capital 64,950 38,950 Deficit accumulated during the development stage (85,168) (33,128) Total Stockholders' Equity (19,768) 6,272 Total Liabilities and Stockholders' Equity $4,041 $7,914 See accompanying notes to financial statements F - 2 Results of Operations For the Six Months Ended September 30, 2014 Revenues $- Operating expenses $52,030 Loss from Operations $(52,030) Net Loss $(52,040) Net Loss Per Share – Basic and Diluted $(0.01) Weighted Average Number of Common Shares Outstanding - Basic and Diluted 4,500,000 For the three and months ended September 30, 2014 and from September 11, 2013 (Inception) to September 30, 2013 Revenue We have not generated any revenues as of the date of this Registration Statement. Expenses Our operating expenses for the three and six months ended September 30, 2014 were $25,843 and $52,030, respectively. Expenses for the period from September 11, 2013 (inception) to September 30, 2013 totaled $3,606. The majority of the expenses incurred during the six months ended September 30, 2014 consisted of corporate filings and start-up costs and $26,000 of in-kind contribution of services from our CEO. For the period from September 11, 2013 (inception) to September 30, 2013, the in-kind contribution of services from our CEO was $3,000. Net Loss As a result of the factors described above, our net loss for the three and six months ended September 30, 2014 was $25,825 and $52,040, respectively, compared to $3,606 for the period from September 11, 2013 (inception) to September 30, 2013. For the period from September 11, 2013 (Inception) to March 31, 2014 Revenue For the period from September 11, 2013 (inception) to March 31, 2014 we had $0 in revenue. We did not generate any revenue during this period because we were setting up all our corporate documents and beginning our business. Expenses Expenses for the period from September 11, 2013 (inception) to March 31, 2014 totaled $33,128. The majority of the expenses incurred during the period consisted of corporate filings and start-up costs and $29,000 of in-kind contribution of services from our CEO. Net Loss As a result of the factors described above, our net loss for the period ended March 31, 2014 was $33,128. Liquidity and Capital Resources Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. We have been funding our operations through the sale of our common stock. Our primary uses of cash have been for legal, accounting and audit fees. The following trends are reasonably likely to result in a material decrease in our liquidity in the near term: Development of a consumer facing website Exploration of potential marketing and advertising opportunities, and The cost of being a public company Our net revenues are not sufficient to fund our operating expenses. At September 30, 2014, we had a cash balance of $4,041 and a working capital deficit of $19,768. Since inception, we raised $10,000 from the sale of common stock to fund our operating expenses, pay our obligations, and grow our company. We currently have no material commitments for capital expenditures. We may be required to raise additional funds, particularly if we are unable to generate positive cash flow as a result of our operations. We estimate that based on current plans and assumptions, that our available cash will not be sufficient to satisfy our cash requirements under our present operating expectations, without further financing, for up to 12 months. Other than working capital, we presently have no other alternative source of working capital. We may not have sufficient working capital to fund the expansion of our operations and to provide working capital necessary for our ongoing operations and obligations. We may need to raise significant additional capital to fund our operating expenses, pay our obligations, and grow our company. We do not anticipate we will be profitable in 2014. Therefore our future operations may be dependent on our ability to secure additional financing. Financing transactions may include the issuance of equity or debt securities, obtaining credit facilities, or other financing mechanisms. However, the trading price of our common stock and a downturn in the U.S. equity and debt markets could make it more difficult to obtain financing through the issuance of equity or debt securities. Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect amounts owed to us, or experience unexpected cash requirements that would force us to seek alternative financing. Furthermore, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. The inability to obtain additional capital will restrict our ability to grow and may reduce our ability to continue to conduct business operations. If we are unable to obtain additional financing, we will likely be required to curtail our marketing and development plans and possibly cease our operations. Our viable plan to continue existence for at least 12 months following effectiveness of our registration statement is based upon further loans from our President and Sole Director as well as our continued efforts to generate revenue from sales of our BookBunch subscription service and/or book fair services to authors. Our past operations have been funded by loans from our President and Sole Director. We do not have any written or oral commitment from our President to provide any amount of additional funding and he has no obligation to provide the Company with any additional funding. Readaboo, Inc. and Subsidiary Consolidated Statements of Operations (Unaudited) For the period From September 11, 2013 For the Three Months Ended For the Six Months Ended (Inception) to September 30, 2014 September 30, 2014 September 30, 2013 Revenue Operating Expenses Professional fees $12,278 $23,493 $- General and administrative 13,565 28,537 3,606 Total Operating Expenses 25,843 52,030 3,606 Loss from Operations (25,843) (52,030) (3,606) Other (Expense) Other Income 58 58 - Interest Expense (40) (68) - NET LOSS $(25,825) $(52,040) $(3,606) Net Loss Per Share - Basic and Diluted $(0.01) $(0.01) $- Weighted average number of shares outstanding during the year/period - Basic and Diluted 4,500,000 4,500,000 - See accompanying notes to financial statements F - 3 We anticipate that depending on market conditions and our plan of operations, we may incur operating losses in the foreseeable future. Therefore, our auditors have raised substantial doubt about our ability to continue as a going concern. Our liquidity may be negatively impacted by the significant costs associated with our public company reporting requirements, costs associated with newly applicable corporate governance requirements, including requirements under the Sarbanes-Oxley Act of 2002 and other rules implemented by the Securities and Exchange Commission. We expect all of these applicable rules and regulations to significantly increase our legal and financial compliance costs and to make some activities more time consuming and costly. Our business plan within 12 months is outlined below: In the next twelve months, our business plan is focused on adding authors to our subscription service as well as selling BookBunches to readers and book fair services to authors. In order to accomplish these goals, the key element is the ability to add authors to our subscription service library. This will require us to have a fully developed website with payment processing functionality in order to be able to collect credit card payments from readers interested in purchasing our subscription BookBunch service as well as the functionality of adding authors books in ebook formats to the backend of our website. We estimate the development costs of creating such a website to be $50,000. Our ability to make sales of BookBunch subscriptions depends in significant part on our ability to further develop our website. We plan to fund the development of our website by raising capital and/or obtaining further loans from our President. We do not have any written or oral commitment from our President to provide any amount of additional funding and he has no obligation to provide the Company with any additional funding. If we are unable to build our customer base or gain any clients, we will cease our development and/or marketing operations until we raise money. Attempting to raise capital after failing in any phase of our development plan could be difficult. As such, if we cannot secure additional proceeds we will have to cease operations and investors would lose their entire investment. At the present time, we have not made any arrangements to raise additional cash. However, we intend to raise additional capital through private placements once we gain a quotation on the OTC Markets, for which there is no assurance. Even if we obtain a quotation on the OTC Markets, there is no assurance that additional capital through debt or equity offerings or through private placements will be available to us on commercially reasonable terms, or at all. If we need additional cash but are unable to raise it, we will either suspend marketing operations until we do raise the cash, or cease operations entirely. Other than as described in this paragraph, we have no other financing plans. Off-Balance Sheet Arrangements We have no off-balance sheet arrangements. Contractual Obligations We do not have any contractual obligations at this time. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE There have been no changes in or disagreements with accountants on accounting or financial disclosure matters. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS The following table sets forth the names and ages of officers and director as of the date of our registration statement, of which this prospectus is a part. Our executive officers are elected annually by our Board of Directors. Our executive officers hold their offices until they resign, are removed by the Board, or his successor is elected and qualified. Name Age Position Ajay Tandon 37 President and Sole Director Readaboo, Inc. and Subsidiary Consolidated Statements of Changes in Stockholders' Equity For the period from September 11, 2013 (Inception) to September 30, 2014 Deficit Additional accumulated during the Total Preferred Stock Common stock paid-in development Stockholders' Shares Amount Shares Amount capital stage Equity Balance September 11, 2013 - $- - $- $- $- $- Common stock issued for services to founder ($0.0001 per share) - - 4,000,000 400 - - 400 Common stock issued for cash ($0.02/ per share) - - 500,000 50 9,950 - 10,000 In kind contribution of services - - - - 29,000 - 29,000 Net loss for the period September 11, 2013 (inception) to March 31, 2014 - - - - - (33,128) (33,128) Balance, March 31, 2014 (audited) - - 4,500,000 450 38,950 (33,128) 6,272 In kind contribution of services - - - - 26,000 - 26,000 Net loss for the six months ended September 30, 2014 - - - - - (52,040) (52,040) Balance, September 30, 2014 (unaudited) - $- 4,500,000 $450 $64,950 $(85,168) $(19,768) See accompanying notes to financial statements F - 4 Set forth below is a brief description of the background and business experience of our executive officer and director for the past five years. Ajay Tandon, President and Sole Director Mr. Tandon has been President of the Company since inception. From 2011 to present, he has also served as the Chief Executive Officer of SeeThruEquity, LLC, an independent equity research firm. From 2009 to 2011, Mr. Tandon served as President and Chief Financial Officer of Emissary Capital Group, LLC. Prior to that, Mr. Tandon held roles at Maxim Group LLC, Dealogic (Holdings) PLC, and IBM Global Services. Mr. Tandon earned his Bachelor of Arts degree from Cornell University. Term of Office Our directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board. EXECUTIVE COMPENSATION The following table presents information concerning compensation for each of our named executive officers for services in all capacities during the years indicated: SUMMARY COMPENSATION TABLE Name and Principal Position Year Salary ($) Bonus ($) Stock Awards ($) Option Awards ($) Non- Equity Incentive Plan Compensation ($) Non- Qualified Deferred Compensation Earnings ($) All Other Compensation ($) Totals ($) Ajay Tandon, President and 2014 $29,000 0 400(2) 0 0 0 0 $29,400 Sole Director 2013 $0 0 0 0 0 0 0 $0 (1)The Company recorded $29,000 to additional paid in capital as in-kind contribution of Mr. Ajay Tandon s services. (2)Mr. Ajay Tandon received 4,000,000 shares of the Company s common stock for $400 in services as founders shares Option Grants There were no individual grants of stock options to purchase our common stock made to the executive officers named in the Summary Compensation Table. Aggregated Option Exercises and Fiscal Year-End Option Value There were no stock options exercised by the executive officers named in the Summary Compensation Table. Long-Term Incentive Plan ("LTIP") Awards There were no awards made to a named executive officers in the last completed fiscal year under any LTIP Compensation of Directors Directors are permitted to receive fixed fees and other compensation for their services as directors. The Board of Directors has the authority to fix the compensation of directors. No amounts have been paid to, or accrued to, directors in such capacity. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION ON DECEMBER __, 2014 READABOO, INC. 500,000 SHARES OF COMMON STOCK The selling security holders named in this prospectus are offering all of the shares of common stock offered through this prospectus. The common stock to be sold by the selling shareholders as provided in the "Selling Security Holders" section is common stock that are shares that have already been issued and are currently outstanding. We will not receive any proceeds from the sale of the common stock covered by this prospectus. Our common stock is presently not traded on any market or securities exchange. The selling security holders have not engaged any underwriter in connection with the sale of their shares of common stock. Common stock being registered in this registration statement may be sold by selling security holders at a fixed price of $0.02 per share. There can be no assurance that a market maker will agree to file the necessary documents with the Financial Industry Regulatory Authority ("FINRA"), which operates the OTC Markets, nor can there be any assurance that such an application for quotation will be approved. We have agreed to bear the expenses relating to the registration of the shares of the selling security holders. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") and are subject to reduced public company reporting requirements. The selling security holders are "underwriters" within the meaning of the Securities Act of 1933, as amended, with respect to all shares being offered hereby. Our independent registered public accounting firm has expressed substantial doubt as to our ability to continue as a going concern. Investing in our common stock involves a high degree of risk. See "Risk Factors" beginning on page 4 to read about factors you should consider before buying shares of our common stock. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The Date of This Prospectus is: December __, 2014 TABLE OF CONTENTS PAGE Prospectus Summary 1
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+The following is a summary of material information discussed in this prospectus. It is included for convenience only and should not be considered complete. You should carefully review this entire prospectus, including the risk factors, to better understand the Spin-Off and our business and financial position.
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+Table of Contents Summary Clearwater Ventures, Inc. The Company We were incorporated as Clearwater Ventures, Inc. on February 4, 2014 in the State of Nevada for the purpose of designing and marketing a new pool filter product known as the Pool Guardian. The Pool Guardian is designed to supplement and assist pool filters by capturing and holding unwanted pool surface debris. It functions by creating a mild rotation of the pool water, and collects any particulates from the surface into an easily managed screen container. We have completed our initial designs and have built a functioning prototype. We are seeking funding for the purpose of further testing and developing our product, constructing additional prototypes, and beginning our initial marketing efforts. We are a development stage company and have not generated any revenues to date. As of February 28, 2014, we had $15,025 in current assets and current liabilities in the amount of $5,560. Accordingly, we had working capital of $9,465 as of February 28, 2014. Our current working capital is not sufficient to enable us to implement our business plan as set forth in this prospectus. In addition, if we are unable to achieve sales revenue sufficient to fund ongoing operations by the end of our fiscal year beginning March 1, 2014, we will be required to seek additional financing. We currently do not have any arrangements for financing and we may not be able to obtain financing when required. For these and other reasons, our independent auditors have raised substantial doubt about our ability to continue as a going concern. Accordingly, we will require additional financing, including the equity funding sought in this prospectus. Because there is no minimum amount of shares that must be sold in order for the Offering to close, there is a risk that we may receive no proceeds from this Offering, or that investors in the Offering will own in shares in a company that has: (1) not received enough proceeds from the Offering to begin operations, and (2) has no market for its shares. We are offering for sale to investors a maximum of 2,000,000 shares of our common stock at an offering price of $0.01 per share (the "Offering"). Our business plan is to use the proceeds of this offering for further testing and development of our product, construction of additional prototypes, and some initial marketing efforts. The minimum investment amount for a single investor is $500 for 50,000 shares. The shares are being offered by us on a "best efforts" basis and there can be no assurance that all or any of the shares offered will be subscribed. If less than the maximum proceeds are available to us, our development and prospects could be adversely affected. There is no minimum offering required for this offering to close. The proceeds of this offering will be immediately available to us for our general business purposes. The Maximum Offering amount is 2,000,000 shares ($20,000). Our address is 8174 Las Vegas Blvd. S., Ste. 109, Las Vegas, NV 89123. Our phone number is (702) 779-9871. Our fiscal year end is February 28. Table of Contents The Offering Securities Being Offered Up to 2,000,000 shares of our common stock. Offering Price The offering price of the common stock is $0.01 per share. There is no public market for our common stock. We cannot give any assurance that the shares offered will have a market value, or that they can be resold at the offered price if and when an active secondary market might develop, or that a public market for our securities may be sustained even if developed. The absence of a public market for our stock will make it difficult to sell your shares in our stock. Upon the effectiveness of the registration statement of which this prospectus is a part, we intend to apply through FINRA to the over-the-counter bulletin board, through a market maker that is a licensed broker dealer, to allow the trading of our common stock upon our becoming a reporting entity under the Securities Exchange Act of 1934. Minimum Number of Shares To Be Sold in This Offering n/a Maximum Number of Shares To Be Sold in This Offering 2,000,000 Securities Issued and to be Issued 16,000,000 shares of our common stock are issued and outstanding as of the date of this prospectus. Our sole officer and director, Tuston Brown, owns 100% of the common shares of our company and therefore has substantial control. Upon the completion of this offering, our officer and director will own an aggregate of approximately 88.89% of the issued and outstanding shares of our common stock if the maximum number of shares is sold. Number of Shares Outstanding After The Offering If All The Shares Are Sold 18,000,000 Use of Proceeds If we are successful at selling all the shares we are offering, our proceeds from this offering will be approximately $20,000. We intend to use these proceeds to execute our business plan. Offering Period The shares are being offered for a period up to 120 days after the date of this Prospectus, unless extended by us for an additional 90 days. Table of Contents Summary Financial Information Balance Sheet Data Fiscal Year Ended February 28, 2014 (audited) Cash $15,025 Total Assets 15,050 Liabilities 5,560 Total Stockholder s Equity 9,490 Statement of Operations February 24, 2014 (date of inception) to February 28, 2014 (audited) Revenue $0 Net Profit (Loss) for Reporting Period $(5,560) Risk Factors You should consider each of the following risk factors and any other information set forth herein and in our reports filed with the SEC, including our financial statements and related notes, in evaluating our business and prospects. The risks and uncertainties described below are not the only ones that impact on our operations and business. Additional risks and uncertainties not presently known to us, or that we currently consider immaterial, may also impair our business or operations. If any of the following risks actually occur, our business and financial results or prospects could be harmed. In that case, the value of the Common Stock could decline. Risks Related To Our Financial Condition and Business Model Because we are an "emerging growth company," we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies." We are an "emerging growth company" as defined under the Jumpstart our Business Startups Act ("JOBS Act"). We will remain an "emerging growth company" for up to five years, or until the earliest of: (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. As an "emerging growth company", we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to: not being required to comply with the auditor attestation requirements of section 404(b) of the Sarbanes-Oxley Act ("Sarbanes Oxley") (we also will not be subject to the auditor attestation requirements of section 404(b) as long as we are a "smaller reporting company", which includes issuers that had a public float of less than $75 million as of the last business day of their most recently completed second fiscal quarter); reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. In addition, section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in section 7(a)(2)(B) of the Securities Act of 1933 (the "Securities Act") for complying with new or revised accounting standards. Under this provision, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. However, we are choosing to "opt out" of such extended transition period and, as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. Table of Contents If we do not obtain additional financing, including the financing sought in this offering, our business will fail. We have not yet commenced active operations and have not generated any revenue to date. Our business plan calls for expenses related to the acquisition of certain supplies for the further testing and development of our product, the construction of additional prototypes, some initial marketing efforts, and other start-up costs. Our cash requirements over the current fiscal year are expected to be approximately $20,000. As of February 28, 2014, we had cash on hand in the amount of $15,025 and working capital in the amount of $9,465. Accordingly, our business will likely fail if we are unable to successfully complete this Offering at or near the maximum offering amount. In addition, if we are unable to achieve sales revenue sufficient to fund ongoing operations by the end of our fiscal year beginning March 1, 2014, we will be required to seek additional financing. We currently do not have any arrangements for financing and we may not be able to obtain financing when required. Obtaining additional financing beyond the initial equity financing sought through this offering will be subject to a number of factors, including our ability to show strong early revenues and sustained sales growth. These factors may make the most desirable timing, amount, and terms or conditions of additional financing unavailable to us. Because we have no prior experience marketing and manufacturing our Pool Guardian product, we may find it difficult to generate significant revenue and we face a high risk of business failure. Our management has no prior experience marketing and manufacturing our Pool Guardian product. We commenced operations in February of 2014 and have only recently completed our first working prototype. We will require further testing and development of our product to ensure it is effective in a wide variety of pool types, and we have no experience in manufacturing the product in significant quantities. We lack a proven track record of constructing quality products on which to rely in marketing to potential customers. Because of our lack of experience in marketing and manufacturing our planned product, we can provide no assurance that we will be able to generate significant sales or net profits. We have not earned any revenues as of the date of this prospectus, and we face a high risk of business failure. If we are unable to secure agreements with one or more licensee manufacturers and/or distributors of our product, we will be unable to bring our product to market in significant quantities and our business will fail to succeed over the long term. In the event that we are successful in our initial marketing efforts, we may lack the capacity to produce sufficient quantities of the Pool Guardian product to fill future customer orders. In order to successfully manufacture our product in significant quantities, we will be required to engage one or more contract manufacturers. At this time, we do not have arrangements with any other company to manufacture and/or distribute the Pool Guardian under license. If we are unable to secure manufacturing and/or distribution agreements for our product, we will be unable to bring it to market in commercially significant quantities and our business will fail over the long term. Because our sole officer and director has no prior experience as a chief executive or as the head of a public company, we may be hindered in our ability to efficiently and competitively execute our business strategy and achieve profitability. Our sole officer and director, Mr. Brown, lacks any prior experience as a company chief executive. In addition, Mr. Brown has no experience managing a publicly reporting company. Accordingly, Mr. Brown will be less effective than more experienced managers in efficiently managing our ongoing regulatory compliance obligations and in dealing with such matters as public relations, investor relations, and corporate governance. Because our auditor has issued a going concern opinion regarding our company, there is an increased risk associated with an investment in our company. We have earned no revenue since our inception, which makes it difficult to evaluate whether we will operate profitably. We have not attained profitable operations and are dependent upon obtaining financing or generating revenue from operations to continue operations for the immediate future. As of February 28, 2014, we had cash in the amount of $15,025. Our future is dependent upon our ability to obtain financing or upon future profitable operations. We are currently seeking equity financing through this offering. We reserve the right to seek additional funds through private placements of our common stock and/or through debt financing. Our ability to raise additional financing is unknown. We do not have any formal commitments or arrangements for the advancement or loan of funds. For these reasons, our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern. As a result, there is an increased risk that you could lose the entire amount of your investment in our company. Because our offering will be conducted on a best efforts basis, there can be no assurance that we can raise the money we need. The shares are being offered by us on a "best efforts" basis without benefit of a private placement agent. We can provide no assurance that this Offering will be completely sold out. If less than the maximum proceeds are available, our business plans and prospects for the current fiscal year could be adversely affected. Because there is no minimum amount of shares that must be sold in order for the Offering to close, there is a risk that we may receive no proceeds from this Offering, or that investors in the Offering will own in shares in a company that has: (1) not received enough proceeds from the Offering to begin operations, and (2) has no market for its shares. Because our president only provides his services on a part-time basis, he may not be able or willing to devote a sufficient amount of time to our business operations, causing our business to fail. Mr. Brown, our founder and sole officer and director, currently devotes 10 to 15 hours per week to our business affairs. If the demands of our business require the full business time of Mr. Brown, it is possible that he may not be able to devote sufficient time to the management of our business, as and when needed. If our management is unable to devote a sufficient amount of time to manage our operations, our business will fail. Because we will incur additional costs as the result of becoming a public company, our cash needs will increase and our ability to achieve net profitability may be delayed. Upon effectiveness of our Registration Statement for the Offering, we will become a publicly reporting company and will be required to stay current in our filings with the SEC, including, but not limited to, quarterly and annual reports, current reports on materials events, and other filings that may be required from time to time. We believe that, as a public company, our ongoing filings with the SEC will benefit shareholders in the form of greater transparency regarding our business activities and results of operations. In becoming a public company, however, we will incur additional costs in the form of audit and accounting fees and legal fees for the professional services necessary to assist us in remaining current in our reporting obligations. We expect that, during our first year of operations following the effectiveness of our Registration Statement, we will incur additional costs for professional fees in the approximate amount of $10,000. These additional costs will increase our cash needs and may hinder or delay our ability to achieve net profitability even after we have begun to generate revenues from sales of our products. Table of Contents Risks Related To Legal Uncertainty If we are the subject of future personal injury or related liability suits, our business will likely fail. Use of our Pool Guardian product may pose some potential risk of accident or injury to our customers resulting from their installation or operation of the device, or for potential injuries caused to pool swimmers if they bump into the device while in the pool. We currently do not maintain liability insurance and we may not be able to obtain such coverage in the future or such coverage may not be adequate to cover all potential claims. Moreover, even if we are able to maintain sufficient insurance coverage in the future, any successful claim could significantly harm our business, financial condition and results of operations. Because our product currently lacks patent protection, we may not be able to prevent competitors from making and marketing similar products. Our competitors may be able to duplicate our products without infringement on our technology. At this time, neither we nor the inventor of our product has been issued a patent on our current product. The absence of patent protection presents a risk that we will be unable to prevent other persons from developing competitive products. While we may rely on laws of "trade secret" to protect some rights of proprietary ownership, proving such claims may be costly and would likely divert monies that would otherwise be available for expanding operations. Risks Related To This Offering If a market for our common stock does not develop, shareholders may be unable to sell their shares. Prior to this offering, there has been no public market for our securities and there can be no assurance that an active trading market for the securities offered herein will develop after this offering, or, if developed, be sustained. We anticipate that, upon completion of this offering, the common stock will be eligible for quotation on the OTC Bulletin Board. If for any reason, however, our securities are not eligible for initial or continued quotation on the OTC Bulletin Board or a public trading market does not develop, purchasers of the common stock may have difficulty selling their securities should they desire to do so and purchasers of our common stock may lose their entire investment if they are unable to sell our securities. Because FINRA sales practice requirements may limit a stockholder s ability to buy and sell our stock, investors may not be able to sell their stock should they desire to do so. In addition to the "penny stock" rules described below, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may have the effect of reducing the level of trading activity in our common stock. As a result, fewer broker-dealers may be willing to make a market in our common stock, reducing a stockholder's ability to resell shares of our common stock. Because state securities laws may limit secondary trading, investors may be restricted as to the states in which they can sell the shares offered by this prospectus. If you purchase shares of our common stock sold in this offering, you may not be able to resell the shares in any state unless and until the shares of our common stock are qualified for secondary trading under the applicable securities laws of such state or there is confirmation that an exemption, such as listing in certain recognized securities manuals, is available for secondary trading in such state. There can be no assurance that we will be successful in registering or qualifying our common stock for secondary trading, or identifying an available exemption for secondary trading in our common stock in every state. If we fail to register or qualify, or to obtain or verify an exemption for the secondary trading of, our common stock in any particular state, the shares of common stock could not be offered or sold to, or purchased by, a resident of that state. In the event that a significant number of states refuse to permit secondary trading in our common stock, the market for the common stock will be limited which could drive down the market price of our common stock and reduce the liquidity of the shares of our common stock and a stockholder's ability to resell shares of our common stock at all or at current market prices, which could increase a stockholder's risk of losing some or all of his investment. Because we do not expect to pay dividends for the foreseeable future, investors seeking cash dividends should not purchase our common stock. We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future. Our payment of any future dividends will be at the discretion of our board of directors after taking into account various factors, including but not limited to our financial condition, operating results, cash needs, growth plans and the terms of any credit agreements that we may be a party to at the time. Accordingly, investors must rely on sales of their own common stock after price appreciation, which may never occur, as the only way to realize their investment. Investors seeking cash dividends should not purchase our common stock. Because we will be subject to the "Penny Stock" rules, the level of trading activity in our stock may be reduced. Broker-dealer practices in connection with transactions in "penny stocks" are regulated by penny stock rules adopted by the Securities and Exchange Commission. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on some national securities exchanges or quoted on Nasdaq). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and, if the broker-dealer is the sole market maker, the broker-dealer must disclose this fact and the broker-dealer s presumed control over the market, and monthly account statements showing the market value of each penny stock held in the customer s account. In addition, broker-dealers who sell these securities to persons other than established customers and "accredited investors" must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser s written agreement to the transaction. Consequently, these requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security subject to the penny stock rules, and investors in our common stock may find it difficult to sell their shares. Table of Contents If our shares are quoted on the over-the-counter bulletin board, we will be required to remain current in our filings with the SEC and our securities will not be eligible for quotation if we are not current in our filings with the SEC. In the event that our shares are quoted on the over-the-counter bulletin board, we will be required order to remain current in our filings with the SEC in order for shares of our common stock to be eligible for quotation on the over-the-counter bulletin board. In the event that we become delinquent in our required filings with the SEC, quotation of our common stock will be terminated following a 30 day grace period if we do not make our required filing during that time. If our shares are not eligible for quotation on the over-the-counter bulletin board, investors in our common stock may find it difficult to sell their shares. Because purchasers in this offering will experience immediate and substantial dilution in the net tangible book value of their common stock, you may experience difficulty recovering the value of your investment. Purchasers of our securities in this offering will experience immediate and substantial dilution in the net tangible book value of their common stock from the initial public offering price. Dilution in net tangible book value per share represents the difference between the amount per share paid by purchasers of shares of our common stock in this offering and the pro forma net tangible book value per share of our common stock immediately following this offering. The dilution experienced by investors in this offering will result in a net tangible book value per share that is less than the offering price of $0.01 per share. Such dilution may depress the value of the company s common stock and make it more difficult to recover the value of your investment in a timely manner should you chose sell your shares. If we undertake future offerings of our common stock, purchasers in this offering will experience dilution of their ownership percentage. Generally, existing shareholders will experience dilution of their ownership percentage in the company if and when additional shares of common stock are offered and sold. In the future, we may be required to seek additional equity funding in the form of private or public offerings of our common stock. In the event that we undertake subsequent offerings of common stock, your ownership percentage, voting power as a common shareholder, and earnings per share, if any, will be proportionately diluted. This may, in turn, result in a substantial decrease in the per-share value of your common stock. Because we are currently considered a "shell company" within the meaning of Rule 12b-2 under the Exchange Act, the ability of certain holders of our common stock to re-sell their shares may be limited by applicable regulations. We are currently considered a "shell company" within the meaning of Rule 12b-2 under the Exchange Act and Rule 405 of the Securities Act of 1933, in that we currently have nominal operations and nominal assets other than cash. Accordingly, the ability of certain holders of our common stock to re-sell their shares may be limited by applicable regulations. Specifically, all of the presently outstanding shares of our common stock are currently considered restricted securities, as defined under Rule 144 promulgated under the Securities Act. Shares of common stock which are considered "restricted securities" may not be sold except through a qualified registration statement under the Securities Act, pursuant to Section 4(1) of the Securities Act, or by meeting the conditions of Rule 144(i) under the Securities Act. The conditions of Rule 144(i) will not be met until: (1) we file Form 10-level information with the SEC when we cease to be a "shell company"; (2) we have filed all reports as required by Section 13 and 15(d) of the Securities Act for twelve consecutive months; and (3) one year has elapsed from the time we filed the current Form 10-level information with the SEC reflecting our status as an entity that is not a shell company. Forward-Looking Statements This prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward-looking statements. The actual results could differ materially from our forward-looking statements. Our actual results are most likely to differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in this
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+S-1 1 v377021_s1.htm FORM S-1 As filed with the Securities and Exchange Commission on May 6, 2014 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Midstate Bancorp, Inc. (Exact Name of Registrant as Specified in Its Charter) Maryland (State or Other Jurisdiction of Incorporation or Organization) 6712 (Primary Standard Industrial Classification Code Number) Being applied for (I.R.S. Employer Identification Number) 6810 York Road Baltimore, Maryland 21212 (410) 377-4330 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant s Principal Executive Offices) Mr. N. Alan Anthony President and Chief Executive Officer Midstate Community Bank 6810 York Road Baltimore, Maryland 21212 (410) 377-4330 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) Copies to: Frank C. Bonaventure, Esq. Ober, Kaler, Grimes & Shriver, P.C. 100 Light Street Baltimore, Maryland 21202 (410) 685-1120 Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: x If this Form is filed to register additional shares for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company x (Do not check if a smaller reporting company) CALCULATION OF REGISTRATION FEE Title of each class of Amount to be Proposed maximum Proposed maximum Amount of securities to be registered registered offering price per share aggregate offering price registration fee Common Stock, $0.01 par value per share 3,438,500 shares $10.00 $34,385,000 (1) $4,428.79 (1) Estimated solely for the purpose of calculating the registration fee. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. PROSPECTUS MIDSTATE BANCORP, INC. (Proposed Holding Company for Midstate Community Bank) Up to 2,990,000 Shares of Common Stock Midstate Bancorp, Inc., a Maryland corporation, and the proposed holding company for Midstate Community Bank, is offering shares of common stock for sale in connection with the conversion of Midstate Community Bank from a Maryland state-chartered mutual savings bank to a Maryland state-chartered commercial bank, a stock form of organization. There are currently no shares of our common stock outstanding. We expect that our common stock will be quoted on the Over-the-Counter Bulletin Board upon the conclusion of the offering. We are an "emerging growth company" as defined in the Jumpstart Our Business Startups Act. We are offering up to 2,990,000 shares of common stock for sale at a price of $10.00 per share on a best efforts basis. We may sell up to 3,438,500 shares of common stock because of demand for the shares or changes in market conditions without resoliciting subscribers. We must sell a minimum of 2,210,000 shares in order to complete the offering. We are offering the shares of common stock in a "subscription offering" to eligible depositors of Midstate Community Bank. Shares of common stock not purchased in the subscription offering may be offered for sale to the general public in a "community offering." We also may offer for sale shares of common stock not purchased in the subscription offering or community offering through a "syndicated community offering" managed by Sandler O Neill & Partners, L.P. The minimum number of shares of common stock you may order is 25 shares. The maximum number of shares of common stock that can be ordered by any person in the offering through a single qualifying deposit account is 25,000 shares ($250,000), and no person, together with an associate or group of persons acting in concert, may purchase more than 50,000 shares ($500,000) in the offering. The offering is expected to expire at 4:00 p.m., Eastern Time, on [expiration date]. We may extend this expiration date without notice to you until [extension date]. The Maryland Office of the Commissioner of Financial Regulation and the Federal Deposit Insurance Corporation may approve further extensions. No single extension may exceed 90 days, and the offering may not conclude beyond [final expiration date]. Once submitted, orders are irrevocable unless the offering is terminated or is extended beyond [extension date] or the number of shares of common stock to be sold is increased to more than 3,438,500 shares or decreased to less than 2,210,000 shares. If the offering is extended beyond [extension date], we will resolicit subscribers and you will have the opportunity to maintain, change or cancel your order within a specified period of time. If you do not respond during that period, we will promptly return your funds with interest at [interest rate]% per annum or cancel your deposit account withdrawal authorization. If the number of shares to be sold is increased to more than 3,438,500 shares or decreased to less than 2,210,000 shares, all funds submitted for the purchase of shares of common stock in the offering will be returned promptly with interest at [interest rate]% per annum. We may then resolicit all subscribers, giving them an opportunity to place a new order within a specified period of time. Funds received in the subscription and community offerings will be held in a segregated account at Midstate Community Bank and will earn interest at [interest rate]% per annum until completion of the offering. Sandler O Neill & Partners, L.P. will assist us in selling our shares of common stock on a best efforts basis. Sandler O Neill & Partners, L.P. is not required to purchase any shares of the common stock that are being offered for sale. We expect our directors and executive officers and their associates to purchase an aggregate of 130,000 shares, or 5.88%, of the shares at the minimum of the offering range. See "Summary—Purchases by Executive Officers and Directors." This investment involves a degree of risk, including the possible loss of your investment. Please read "Risk Factors" beginning on page 13. OFFERING SUMMARY Price: $10.00 per Share Minimum Midpoint Maximum Adjusted Maximum Number of Shares 2,210,000 2,600,000 2,990,000 3,438,500 Gross offering proceeds $22,100,000 $26,000,000 $29,900,000 $34,385,000 Estimated offering expenses (excluding marketing agent fees & expenses) $582,589 $582,589 $582,589 $582,589 Estimated marketing agent fees and expenses (1) $334,352 $373,820 $413,288 $458,676 Estimated net proceeds $21,183,059 $25,043,591 $28,904,123 $33,343,735 Estimated net proceeds per share $9.59 $9.63 $9.67 $9.70 (1) Selling agent commissions shown assume that all shares are sold in the subscription offering and includes estimated expenses of $125,000. See "The Conversion and Offering—Marketing and Distribution; Compensation." These securities are not deposits or accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. None of the Securities and Exchange Commission, Maryland Office of the Commissioner of Financial Regulation, Federal Deposit Insurance Corporation, Board of Governors of the Federal Reserve System, nor any state securities regulator has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. For assistance, please call the Stock Information Center at (410) - The date of this prospectus is [Prospectus Date]. The Conversion and Our Organizational Structure Pursuant to the terms of our plan of conversion, Midstate Community Bank will convert from a Maryland state-chartered mutual (meaning no stockholders) savings bank to a Maryland state-chartered commercial bank and will operate as a wholly owned subsidiary of Midstate Bancorp. As a part of the conversion, Midstate Bancorp, the newly formed proposed holding company for Midstate Community Bank, is offering for sale in a subscription offering and, if necessary, a community offering and a syndicated community offering, shares of its common stock. Upon completion of the offering, Midstate Bancorp will own 100% of the outstanding shares of common stock of Midstate Community Bank, and all of the common stock of Midstate Bancorp will be owned by purchasers in the offering. The following diagram depicts our corporate structure after the conversion and offering: Our Business Strategy Our current business strategy focuses primarily on creating sustainable profitability that enables asset growth while enhancing our regulatory capital. Highlights of our business strategy are as follows: Reducing nonperforming assets. Our nonperforming assets constitute 4.76% of total assets at December 31, 2013, compared to 7.83% at December 31, 2012. We have curtailed origination of investor loans, land development loans and commercial real estate loans that tend to have a higher rate of nonperformance. We are actively working with nonperforming borrowers to restructure loans so that they can become performing. Further, we continue to evaluate each property and actively monitor and workout each nonperforming asset, and actively seek to sell foreclosed properties and to rent such properties if they cannot be sold at a reasonable price given market conditions. Controlled asset growth funded by core deposits. We intend to maintain our focus on the origination of fixed rate residential mortgages even as we attempt to increase our variable rate loans. Given the current residential mortgage origination environment, we will focus on growing our portfolio of loans by specializing in originating loans not fully supported by the secondary market. This could include loans that offer opportunity for growth such as jumbo, condo and owner-occupied residential construction loans. We also intend to offer secondary market loan products that may provide customers additional loan options that the Bank cannot maintain in its portfolio. Expand focus to business relationships. We have traditionally focused on the retail market and not on the business sector. However, we believe that our local market provides the Bank an opportunity to attract those small businesses, including sole proprietorships, that desire a deposit relationship with highly personalized service and competitive products and delivery channels, and that the large number of smaller (less than $10 million annual revenue) businesses in our market area presents an opportunity for Midstate Community Bank to grow over the next several years. Over the next several years we intend to develop deposit products and other services, including remote deposit capture and fee for income services such as merchant services, wire transfers, Automated Clearing House (ACH) payments and credit cards, that target the small business sector. Expanding retail customer relationships. Although the Bank has offered checking accounts for a number of years, it is still heavily reliant on certificates of deposit, as well as saving accounts. We believe it is important to decrease our dependence on certificates of deposit and grow noninterest-bearing checking deposits. To accomplish this, we intend to evaluate and determine which retail customer segments to more heavily target. In this regard we are considering the student market given the close proximity of Towson University to the Bank as well as nearby residential neighborhoods. We will also increase the education and development of office personnel to actively seek new customer relationships and expand existing relationships, evaluate current products and delivery channels to ensure that we offer products and services these target customer segments value. Growth of noninterest revenue. Growing our noninterest revenue is a short- and long-term goal. We are in the process of evaluating all of our product offerings to ensure that we have the right products, for the right customers in the right delivery channels. Part of the evaluation is a fresh review of our fee structure to ensure that our products are designed to create value for both the customer and our Bank. In addition, we have entered into brokerage agreements with loan brokers to provide one- to four-family residential real estate loans. We believe there is much opportunity for the Bank in originating residential mortgages. This mortgage origination strategy will enhance net interest income by maintaining or increasing the Bank s loans to assets ratio and potentially provide valuable noninterest income from those loans brokered in the secondary market. Provide necessary resources to support revenue growth. It is our primary objective to generate revenue growth. To further this goal, we intend to adjust our cost structure to match our revenue growth expectations. This may mean that we need to invest in talent, education and technology to facilitate revenue growth. We currently have 16 full-time equivalent employees, and intend to invest a portion of the net proceeds of the offering to help expand our lending staff to supplement existing expertise. As a result, our efficiency ratio (noninterest expense as a percentage of noninterest revenue plus net interest income), which was 62.24% for the year ended December 31, 2013, may increase in the short term as we make these necessary investments to enhance revenue growth, but with the goal that such increases will be offset by increases in noninterest revenue and net interest income. In addition, we continuously evaluate the efficiency and effectiveness of all back office processes and procedures, identifying opportunities for enhanced productivity and efficiency. The Bank intends to hire an outside loan officer to broker loans to the secondary market which will enhance the Bank s noninterest income. This loan officer may occasionally originate loans for the Bank as well. Enhanced risk management. We believe that risk management will continue to be a key differentiator of banks going forward. We give keen attention to risk management bankwide identifying the right skill sets, processes, procedures and organizational and governance structures to ensure effective, sound risk management. The Bank has recently implemented a revised risk management framework that we believe is more comprehensive. By identifying, monitoring and reviewing risk exposure on a regular and recurring basis as well as allocating resources appropriately, we are prepared to proactively mitigate risks, which include strategic, compliance, credit, interest, liquidity, operational, price and reputational risk. The Bank hired an outside loan review firm to perform a comprehensive loan review as of December 31, 2012, including risk ratings on a portion of the loan portfolio. Reasons for the Conversion and Offering Consistent with our business strategy, the primary reasons for converting Midstate Community Bank to the stock form of organization and raising additional capital through the offering are: to increase our capital and support future growth; to enhance our ability to expand our product offerings, including developing products and programs to target small businesses and younger individuals; to have greater flexibility to structure and finance the expansion of our operations; SUMMARY The following summary highlights material information in this prospectus. It may not contain all the information that is important to you. For additional information, you should read this entire prospectus carefully, including the Financial Statements and the notes to the Financial Statements. In this prospectus, the terms "we, "our" and "us" refer to Midstate Bancorp, Inc. and Midstate Community Bank unless the context indicates another meaning. References to the "Bank" refer to Midstate Community Bank. Midstate Community Bank Midstate Community Bank is a Maryland state-chartered mutual savings bank located in the greater Towson, Maryland area. Midstate Building Association was formed in September 1940 from the merger of two banking associations - Druid Hill Perpetual Building Association, which was founded in 1884, and Govanstown Land, Loan and Building Association, which was formed in 1890, and has continuously operated in the greater Towson area since. In June 2012, Midstate Federal Savings and Loan Association converted from a federal mutual savings association to a Maryland-chartered mutual savings bank and changed to its current name, Midstate Community Bank. We provide financial services, primarily residential mortgage loans and retail deposit accounts, to individuals, primarily in Baltimore City, Baltimore County and western Harford County, Maryland. We currently have no branch offices or loan production offices. As of December 31, 2013, Midstate Community Bank had total assets of $177.1 million, total loans, net, of $108.5 million, total deposits of $153.8 million and equity of $21.4 million. Our net income for the year ended December 31, 2013 was $970,000 compared to net income of $706,000 for the year ended December 31, 2012. Our business consists of making loans, primarily one- to four-family residential mortgage loans, using deposits we attract and accept from the general public as well as funds generated from operations. We offer a variety of deposit accounts, including checking accounts, savings accounts, certificates of deposit and traditional and "Roth" individual retirement accounts. Our full service branch provides a drive-through facility for customers convenience. While we do have small portfolios of commercial and multifamily real estate loans, we do not currently make these loans or intend to make these types of loans in the foreseeable future. We intend to continue our focus on originating one- four-family residential mortgage loans and to grow this portfolio of loans. Our deposit products have traditionally focused on individuals, however, we are exploring ways to target small businesses in our area for our deposit products and other services. We also intend to develop products aimed at a younger demographic. Midstate Community Bank is committed to meeting the credit needs of the community, consistent with safe and sound operations. Midstate Community Bank is subject to regulation and examination by the Maryland Office of the Commissioner of Financial Regulation and the Federal Deposit Insurance Corporation, also known as the FDIC. Our executive offices are located at 6810 York Road, Baltimore, Maryland 21212. Our telephone number at this address is (410) 377-4330. Our website address is www.midstatecb.com. Information on our website is not incorporated into this prospectus and should not be considered part of this prospectus. Midstate Bancorp, Inc. The shares being offered will be issued by Midstate Bancorp, a newly formed Maryland corporation that will own all of the outstanding shares of common stock of Midstate Community Bank upon completion of the Bank s mutual-to-stock conversion. Other than matters of an organizational nature, Midstate Bancorp has not engaged in any business to date. Upon completion of the conversion, Midstate Bancorp will be subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System (the "Federal Reserve Board") and the Maryland Office of the Commissioner of Financial Regulation. Midstate Bancorp s executive and administrative office is located 6810 York Road, Baltimore, Maryland 21212. Our telephone number at this address is (410) 377-4330. to retain and attract qualified personnel by establishing stock-based benefit plans for management and employees; and to enhance our community ties by providing customers and members of our community with the opportunity to acquire an ownership interest in Midstate Community Bank. As of December 31, 2013, Midstate Community Bank was considered "well capitalized" for regulatory purposes and is not subject to a directive or a recommendation from the Maryland Office of the Commissioner of Financial Regulation or the FDIC to raise capital. As a result of the conversion, the proceeds from the offering will further improve our capital position during a period of significant economic, regulatory and political uncertainty. See "The Conversion and Offering" for a more complete discussion of our reasons for conducting the conversion and offering. Terms of the Offering We are offering between 2,210,000 and 2,990,000 shares of common stock in a subscription offering to eligible depositors of Midstate Community Bank and to our tax-qualified employee benefit plans in a subscription offering. To the extent shares remain available, we may offer shares for sale in a community offering, with preference given to residents of Baltimore County and Baltimore City, Maryland. The number of shares of common stock to be sold may be increased to up to 3,438,500 shares as a result of demand for the shares of common stock in the offering or changes in market conditions. Unless the number of shares of common stock offered is increased to more than 3,438,500 shares or decreased to fewer than 2,210,000 shares, or the offering is extended beyond [extension date], subscribers will not have the opportunity to change or cancel their stock orders once submitted. The purchase price of each share of common stock to be issued in the offering is $10.00. All investors will pay the same purchase price per share. Investors will not be charged a commission to purchase shares of common stock in the offering. Sandler O Neill & Partners, L.P., our marketing agent in the offering, will use its best efforts to assist us in selling shares of our common stock in the offering. Persons Who May Order Shares of Common Stock in the Offering We are offering the shares of common stock in a subscription offering in the following descending order of priority: First, to depositors of Midstate Community Bank with aggregate account balances of at least $50 as of the close of business on December 31, 2012. Second, to our tax-qualified employee benefit plans (specifically, Midstate Community Bank s employee stock ownership plan), which will receive, without payment therefor, nontransferable subscription rights to purchase in the aggregate up to 10% of the shares of common stock sold in the offering. We expect our employee stock ownership plan to purchase 8% of the shares of common stock sold in the offering. Third, to depositors of Midstate Community Bank with aggregate account balances of at least $50 as of the close of business on [supplemental eligibility date]. Fourth, Midstate Community Bank s depositors as of the close of business on [voting record date] who are not in categories 1 or 3 above. Shares of common stock not purchased in the subscription offering may be offered for sale to the general public in a "community offering," with a preference given to natural persons and trusts of natural persons residing in Baltimore County (in which our office is located) and Baltimore City, Maryland. The community offering may begin concurrently with, during or promptly after the subscription offering as we may determine at any time. If shares remain available for sale following the subscription offering and community offering, we may also offer for sale shares of common stock through a "syndicated community offering" managed by Sandler O Neill & Partners, L.P. We have the right to accept or reject, in our sole discretion, orders received in the community offering or syndicated community offering. Any determination to accept or reject stock orders in the community offering or the syndicated community offering will be based on the facts and circumstances available to management at the time of the determination. If we receive orders for more shares than we are offering, we may not be able to fully or partially fill your order. Shares will be allocated first to categories in the subscription offering. A detailed description of the subscription offering, the community offering and the syndicated community offering, as well as a discussion regarding allocation procedures, can be found in the section of this prospectus entitled "The Conversion and Offering." How We Determined the Offering Range and Price Per Share The amount of common stock we are offering for sale is based on an independent appraisal of the estimated market value of Midstate Bancorp, assuming the conversion and offering are completed. Feldman Financial Advisors, Inc., our independent appraiser, has estimated that, as of April 21, 2014, this market value was $26.0 million. Based on Federal regulations this market value forms the midpoint of a valuation range with a minimum of $22.1 million and a maximum of $29.9 million. Based on this valuation and a $10.00 per share price, the number of shares of common stock being offered for sale by us will range from 2,210,000 shares to 2,990,000 shares. We may sell up to 3,438,500 shares of common stock because of demand for the shares or changes in market conditions without resoliciting subscribers. The $10.00 per share price was selected primarily because it is the price most commonly used in mutual-to-stock conversions of financial institutions. The appraisal is based in part on Midstate Community Bank s financial condition and results of operations, the pro forma effect of the additional capital raised by the sale of shares of common stock in the offering, and an analysis of a peer group of bank holding companies that Feldman Financial Advisors considers comparable to Midstate Bancorp. The appraisal peer group consists of the following companies. Unless otherwise noted, asset size and other information is as of December 31, 2013. Company Name City State Ticker Exchange No of Offices IPO Date Total Assets ($000s) Alliance Bancorp, Inc. of Pennsylvania Broomall PA ALLB NASDAQ 8 01/18/11 425,502 First Federal of Northern Michigan, Inc. Alpena MI FFNM NASDAQ 8 04/04/05 209,657 Georgetown Bancorp, Inc. Georgetown MA GTWN NASDAQ 3 07/12/12 263,033 Hamilton Bancorp, Inc. Towson MD HBK NASDAQ 5 10/10/12 300,470 LSB Financial Corp. Lafayette IN LSBI NASDAQ 5 02/03/95 367,581 Poage Bankshares, Inc. Ashland KY PBSK NASDAQ 10 09/13/11 289,230 Polonia Bancorp, Inc. Huntington Valley PA PBCP NASDAQ 6 11/13/12 305,583 Wellesley Bancorp, Inc. Wellesley MA WEBK NASDAQ 4 01/26/12 458,520 Wolverine Bancorp, Inc. Midland MI WBKC NASDAQ 4 01/20/11 297,761 WVS Financial Corp. Pittsburgh PA WVFC NASDAQ 6 11/29/93 314,033 The following table presents a summary of selected pricing ratios for Midstate Bancorp (on a pro forma basis) and the peer group companies based on earnings and other information as of and for the twelve months ended December 31, 2013 and stock prices as of April 21, 2014, as reflected in the appraisal report. Compared to the average pricing of the peer group, our pro forma pricing ratios at the midpoint of the offering range indicated a discount of 31.2% on a price-to-book value basis and a discount of 31.5% on a price-to-tangible book value basis. Price/Earnings Multiple Price-to-Book Value Price-to-Tangible Book Value Midstate Bancorp Adjusted Maximum 55.6x 67.9% 67.9% Maximum 45.5x 64.0% 64.0% Midpoint 37.0x 60.0% 60.0% Minimum 28.6x 55.3% 55.3% Peer group companies Average 31.3x 87.1% 87.5% Median 30.5x 84.4% 85.0% Premium/(discount) 18.3% -31.2% -31.5% The independent appraisal does not indicate trading market value. Do not assume or expect that our valuation as indicated in the appraisal means that after the conversion and offering the shares of our common stock will trade at or above the $10.00 per share purchase price. Before you make an investment
\ No newline at end of file
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@@ -0,0 +1,399 @@
+PROSPECTUS SUMMARY
+
+ 
+
+AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, WE, US, OUR, AND SAND INTERNATIONAL INC. REFERS TO SAND INTERNATIONAL INC. THE FOLLOWING SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK.
+
+ 
+
+The following summary is qualified in its entirety by the more detailed information and the financial statements and notes thereto appearing elsewhere in this Prospectus. Prospective investors should consider carefully the information discussed under RISK FACTORS and USE OF PROCEEDS sections, commencing on pages 6 and 11, respectively. An investment in our securities presents substantial risks, and you could lose all or substantially all of your investment. 
+
+SAND INTERNATIONAL INC.
+
+Corporate Background and Business Overview
+
+We
+
+operate a consulting business in electromagnetic fields, microwave, electrical and ionizing detection, shielding and protection in Ukraine. We plan to expand our services to European and North American market in the future if we have the available resources and growth to warrant it. Sand International Inc. was incorporated in Nevada on June 14, 2013. We intend to use the net proceeds from this offering to develop our business operations (See Description of Business and Use of Proceeds ). To implement our plan of operations we require a minimum funding of $30,000 for the next twelve months as described in our Plan of Operations. After twelve months period we may need additional financing. If we do not generate any significant revenue we may need a minimum of $10,000 of additional funding to pay for SEC filing requirements. We do not currently have any arrangements for additional financing. Our principal executive offices are located at 13 Stusa Street, Lvov Region, Zvirka, Ukraine, 8000. Our phone number is 011-380-325728055.
+
+We
+
+ have very limited operating history. We require minimum funding of approximately $30,000 to conduct our proposed operations and pay all expenses for a minimum period of one year including expenses associated with this offering and maintaining a reporting status with the SEC. If we are unable to obtain minimum funding of approximately $30,000, our business may fail. Even if we raise $30,000 from this offering or more, we may need more funds to develop growth strategy and to continue maintaining a reporting status.
+
+From inception until the date of this filing, we have had very limited operating activities. Even though we are
+
+a
+
+ company with limited operations our sole officer and our sole director Mr. Savelyeu will devote only a limited time to the company and has no experience in managing a public reporting company his background, experience and business contacts in electromagnetic fields industry are essential to our business and have already resulted in the first revenues of $900 earned on June 24, 2014 pursuant to the signed consulting agreement and are anticipated to result in the future revenues.
+
+ Among some of the reasons for pursuing public company status in the United States are: increased cash and long term capital, better potential future growth strategies, ability to attract and keep future key employees, increased prestige. All opposed to increased and ongoing expenses, potential loss of control and privacy.
+
+ Our financial statements from Inception (June 14, 2013) through March 31, 2014 report no revenues and a net loss of $852. 
+
+Our financial statements for three months ended June 30, 2014 report revenues of $900 and a net loss of $5,175.
+
+ Our independent registered public accounting firm has issued an audit opinion for Sand International Inc. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. To date, we have developed our business plan and entered into a Consulting Agreement with Yar Centre, a Ukraine based company. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. 
+
+5 | Page
+
+ THE OFFERING
+
+The Issuer:
+
+ 
+
+SAND INTERNATIONAL INC.
+
+Securities Being Offered:
+
+ 
+
+4,000,000 shares of common stock.
+
+Price Per Share:
+
+ 
+
+$0.03
+
+Duration of the Offering:
+
+ 
+
+The shares will be offered for a period of two hundred and forty (240) days from the effective date of this prospectus. The offering shall terminate on the earlier of (i) when the offering period ends (240 days from the effective date of this prospectus), (ii) the date when the sale of all 4,000,000 shares is completed, (iii) when the Board of Directors decides that it is in the best interest of the Company to terminate the offering prior the completion of the sale of all 4,000,000 shares registered under the Registration Statement of which this Prospectus is part. The Company will deliver stock certificates attributable to shares of common stock purchased directly to the purchasers within ninety (90) days of the close of the offering.
+
+Gross Proceeds
+
+ 
+
+$120,000
+
+Securities Issued and Outstanding:
+
+There are 4,000,000 shares of common stock issued and outstanding as of the date of this prospectus, held by our sole officer and director, Aliaksandr Savelyeu.
+
+ 
+
+Subscriptions
+
+All subscriptions once accepted by us are irrevocable.
+
+Registration Costs
+
+We estimate our total offering registration costs to be approximately $8,000.
+
+ 
+
+Risk Factors
+
+See Risk Factors and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock.
+
+ 
+
+6 | Page
+
+SUMMARY FINANCIAL INFORMATION
+
+ 
+
+The tables and information below are derived from our
+
+un
+
+audited financial statements for
+
+three months ended June 30, 2014.
+
+ 
+
+Financial Summary
+
+ 
+
+June 30, 2014 ($)
+
+(Unaudited)
+
+Cash and Deposits
+
+ 
+
+ 
+
+1,087
+
+Total Assets
+
+ 
+
+ 
+
+1,087
+
+Total Liabilities
+
+ 
+
+ 
+
+3,124
+
+Total Stockholder s Deficit 
+
+ 
+
+ 
+
+(2,037) 
+
+Statement of Operations
+
+ 
+
+3 months ended June 30, 2014 ($)
+
+(Unaudited)
+
+Total Expenses
+
+ 
+
+ 
+
+6,085
+
+Net Loss for the Period
+
+ 
+
+ 
+
+(5,185)
+
+Net Loss per Share
+
+ 
+
+ 
+
+-
+
+ 
+
+RISK FACTORS
+
+ 
+
+An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. The trading price of our common stock, when and if we trade at a later date, could decline due to any of these risks, and you may lose all or part of your investment.
+
+ 
+
+Risks associated to our business 
+
+Because our independent registered public accountants have issued a going concern opinion, there is a substantial uncertainty that we will continue operations, in which case you could lose your investment. 
+
+Our independent registered public accountants have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months. As of
+
+June 30
+
+, 2014, we had cash in the amount of $
+
+1,087
+
+ and liabilities of $
+
+3,124
+
+. As of the day of this Prospectus we had cash in the amount of $
+
+882
+
+ and liabilities of $
+
+3,124
+
+. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment.
+
+As an emerging growth company under the Jobs Act, we are permitted to rely on exemptions from certain disclosure requirements. 
+
+We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to: 
+
+-
+
+have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; 
+
+-
+
+comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); 
+
+-
+
+submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and 
+
+-
+
+ disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive s compensation to median employee compensation. 
+
+7 | Page
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period and the election is irrevocable. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
+
+We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
+
+Until such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
+
+We are solely dependent upon the funds to be raised in this offering to start our business, the proceeds of which may be insufficient to achieve revenues and profitable operations. We may need to obtain additional financing which may not be available.
+
+ 
+
+Our current operating funds are less than necessary to complete our intended operations in the consulting business in electromagnetic fields. We need the proceeds from this offering to start our operations as described in the Plan of Operation section of this prospectus. As of
+
+June 30
+
+, 2014, we had cash in the amount of $
+
+1,087
+
+ and liabilities of $
+
+3,124
+
+. As of this date, we have had limited operations and
+
+insignificant
+
+ income. The proceeds of this offering may not be sufficient for us to achieve revenues and profitable operations. We may need additional funds to achieve a sustainable sales level where ongoing operations can be funded out of revenues. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. 
+
+8 | Page
+
+ 
+
+We are a 
+
+company and have commenced limited operations in our business. We expect to incur significant operating losses for the foreseeable future. 
+
+ 
+
+We were incorporated on June 14, 2013 and to date have been involved primarily in organizational activities. We have commenced limited business operations. Accordingly, we have no way to evaluate the likelihood that our business will be successful. Potential investors should be aware of the difficulties normally encountered by new companies and the high rate of failure of such enterprises. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the operations that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to the ability to generate sufficient cash flow to operate our business, and additional costs and expenses that may exceed current estimates. We anticipate that we will incur increased operating expenses without realizing any significant revenues. We expect to incur significant losses into the foreseeable future. We recognize that if the effectiveness of our business plan is not forthcoming, we will not be able to continue business operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and it is doubtful that we will generate any significant operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business will most likely fail. 
+
+We face strong competition from lager and well established companies, which could harm our business and ability to operate profitably.
+
+Our industry is competitive. There are many businesses specializing in consulting of electromagnetic fields in Ukraine and Europe and our services are not unique to their services. Even though the industry is highly fragmented, it has a number of large and well established companies, which are profitable and have developed a brand name. Aggressive marketing tactics implemented by our competitors could impact our limited financial resources and adversely affect our ability to compete in our market.
+
+We currently have identified only one customer. If we do not attract new customers, we will not make profit, which will ultimately will result in a cessation of operations. 
+
+We currently have identified only one customer to use our service, a Ukraine based company Yar Centre. We have not identified any other customers and we cannot guarantee we ever will have any other customers. Even if we obtain new customers, there is no guarantee that we will generate a profit. If we cannot generate a profit, we will have to suspend or cease operations. 
+
+The consulting industry of electromagnetic fields might be affected by general economic decline and this could adversely affect our operating results and could lead to lower revenues than expected. 
+
+The consulting industry of electromagnetic fields might be affected by general economic decline. We expect that this could adversely affect our operating results and could lead to lower revenues than expected if economic situation does not change for better.
+
+If we are unable to build and maintain our brand image and corporate reputation, our business may suffer. 
+
+We are a new company, having been formed and commenced operations only in 2013-2014. Our success depends on our ability to build and maintain the brand image for our services. We cannot assure you, however, that any additional expenditure on advertising and marketing will have the desired impact on our services brand image and on customer preferences. Our relationships with all of our customers will be new and may be terminated at any time. We need to maintain and expand our relationships with potential users of our services and effectively manage these relationships. If we fail to successfully manage our relationships with our customers, to build and maintain our brand image and corporate reputation our business may suffer.
+
+9 | Page
+
+Price competition could negatively affect our gross margins. 
+
+Price competition could negatively affect our operating results. To respond to competitive pricing pressures, we will have to offer our services at lower prices in order to retain or gain market share and customers. If our competitors offer discounts on certain services in the future, we will need to lower prices to match the competition, which could adversely affect our gross margins and operating results. 
+
+Because company s headquarters are located outside the United States, U.S. investors may experience difficulties in attempting to effect service of process and to enforce judgments based upon U.S. Federal Securities Laws against the company and its non-U.S. resident officer and director. While we are organized under the laws of State of Nevada, our sole officer and director is non-U.S. resident and our headquarters are located in Ukraine. Consequently, it may be difficult for investors to affect service of process on him in the United States and to enforce in the United States judgments obtained in United States courts against him based on the civil liability provisions of the United States securities laws. Since all our assets will be located in Ukraine it may be difficult or impossible for U.S. investors to collect a judgment against us. 
+
+Because Mr. Savelyeu, our sole officer and director, is not a resident of the United States it may be difficult to enforce any liabilities against him. Accordingly, if an event occurs that gives rise to any liability, shareholders would likely have difficulty in enforcing such liabilities because Mr. Aliaksandr Savelyeu, our sole officer and director resides outside the United States. If a shareholder desired to sue, the shareholder would have to serve a summons and complaint. Even if personal service is accomplished and a judgment is entered against a person, the shareholder would then have to locate assets of that person, and register the judgment in the foreign jurisdiction where assets are located.
+
+Because our sole officer and director will own 50% or more of our outstanding common stock, he will make and control corporate decisions that may be disadvantageous to minority shareholders. 
+
+Mr. Aliaksandr Savelyeu, our sole officer and director, will own 50% or more of the outstanding shares of our common stock. Accordingly, he will have significant influence in determining the outcome of all corporate transactions or other matters, including the election of directors, mergers, consolidations and the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control. Also, Mr. Savelyeu will have the ability to make decisions regarding, (i) whether to issue common stock and preferred stock, including decisions to issue common and preferred stock to himself; (ii) employment decisions, including his own compensation arrangement, and (iii) whether to enter into material transactions with related parties. The interests of Mr. Aliaksandr Savelyeu may differ from the interests of the other stockholders and may result in corporate decisions that are disadvantageous to other shareholders. 
+
+ 
+
+Key management personnel may leave the company, which could adversely affect the ability of the company to continue operations. The Company is entirely dependent on the efforts of its sole officer and director. The Company does not have an employment agreement in place with its sole officer and director. His departure or the loss of any other key personnel in the future could have a material adverse effect on the business. The Company believes that all commercially reasonable efforts have been made to minimize the risks attendant with the departure by key personnel from service. However, there is no guarantee that replacement personnel, if any, will help the Company to operate profitably. The Company does not maintain key person life insurance on its sole officer and director.
+
+While performing our consulting services our sole officer and director, Mr. Savelyeu, could be exposed to electromagnetic fields which may lead to adverse health risks.
+
+While performing our consulting services our sole officer and director, Mr. Savelyeu, could be exposed to electromagnetic fields which may lead to adverse health risks. The loss of Mr. Aliaksandr Savelyeu due to health issues posed by the electromagnetic fields exposure to our company could negatively impact our business development.
+
+10 | Page
+
+Because our current sole officer and director has other business interests, he may not be able or willing to devote a sufficient amount of time to our business operations, causing our business to fail. 
+
+ Aliaksandr Savelyeu, our sole officer and director, currently devotes approximately twenty hours per week providing management services to us. While he presently possesses adequate time to attend to our interest, it is possible that the demands on him from other obligations could increase, with the result that he would no longer be able to devote sufficient time to the management of our business. The loss of Mr. Aliaksandr Savelyeu to our company could negatively impact our business development.
+
+Potential conflict of interest may arise in future that may cause our business to fail, including conflict of interest in allocating Ms. Savelyeu s time to our company as well as additional conflict of interests over determining to which entity a particular business opportunity should be presented.
+
+Potential conflict of interest may arise in future that may cause our business to fail, including conflict of interest in allocating Ms. Savelyeu s time to our company as well as additional conflict of interests over determining to which entity a particular business opportunity should be presented. We do not currently have a right of first refusal pertaining to business opportunities that come to management's attention. While our sole officer and director has verbally agreed to present business opportunities first to us, subject to any pre-existing duty he may have, we have not adopted a policy that expressly prohibits our sole officer and director Mr. Savelyeu from having a direct or indirect financial interest in potential future opportunity or from engaging in business activities of the types conducted by us. As a result, in determining to which entity particular business opportunities should be presented, our sole officer and director Mr. Savelyeu may favor his own interests and the interests of the Karpenko Physical-Mechanical Institute of the National Academy of Science of Ukraine over our interests and those of our shareholders, which could have a material adverse effect on our business and results of operations.
+
+Any additional funding we arrange through the sale of our common stock will result in dilution to existing shareholders. 
+
+We must raise additional capital in order for our business plan to succeed. Our most likely source of additional capital will be through the sale of additional shares of common stock. Such stock issuances will cause stockholders' interests in our company to be diluted. Such dilution will negatively affect the value of an investor's shares.
+
+Risks associated with this offering
+
+Investors cannot withdraw funds once invested and will not receive a refund.
+
+ 
+
+Investors do not have the right to withdraw invested funds. Subscription payments will be paid to Sand International Inc. and held in our corporate bank account if the Subscription Agreements are in good order and the investor is accepted as an investor by the Company. Therefore, once an investment is made, investors will not have the use or right to return of such funds.
+
+Because the offering price has been arbitrarily set by the company, you may not realize a return on your investment upon resale of your shares. 
+
+ 
+
+The offering price and other terms and conditions relative to the Company s shares have been arbitrarily determined by us and do not bear any relationship to assets, earnings, book value or any other objective criteria of value. Additionally, as the Company was formed on June 14, 2013 and has only a limited operating history and
+
+limited
+
+ earnings, the price of the offered shares is not based on its past earnings and no investment banker, appraiser or other independent third party has been consulted concerning the offering price for the shares or the fairness of the offering price used for the shares, as such our stockholders may not be able to receive a return on their investment when they sell their shares of common stock.
+
+Our President, Mr. Aliaksandr Savelyeu does not have any prior experience conducting a best-effort offering, and our best offering does not require a minimum amount to be raised. As a result of this we may not be able to raise enough funds to commence and sustain our business and investors may lose their entire investment. 
+
+Mr. Aliaksandr Savelyeu does not have any experience conducting a best-effort offering. Consequently, we may not be able to raise any funds successfully. Also, the best effort offering does not require a minimum amount to be raised. If we are not able to raise sufficient funds, we may not be able to fund our operations as planned, and our business will suffer and your investment may be materially adversely affected. Our inability to successfully conduct a best-effort offering could be the basis of your losing your entire investment in us.
+
+11 | Page
+
+The trading in our shares will be regulated by the Securities and Exchange Commission Rule 15G-9 which established the definition of a penny stock . 
+
+ 
+
+The shares being offered are defined as a penny stock under the Securities and Exchange Act of 1934, as amended (the Exchange Act ), and rules of the Commission. The Exchange Act and such penny stock rules generally impose additional sales practice and disclosure requirements on broker-dealers who sell our securities to persons other than certain accredited investors who are, generally, institutions with assets in excess of $4,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 ($300,000 jointly with spouse), or in transactions not recommended by the broker-dealer. For transactions covered by the penny stock rules, a broker dealer must make certain mandated disclosures in penny stock transactions, including the actual sale or purchase price and actual bid and offer quotations, the compensation to be received by the broker-dealer and certain associated persons, and deliver certain disclosures required by the Commission. Consequently, the penny stock rules may make it difficult for you to resell any shares you may purchase, if at all.
+
+We are selling this offering without an underwriter and maybe unable to sell any shares.
+
+ 
+
+This offering is self-underwritten, that is, we are not going to engage the services of an underwriter to sell the shares; we intend to sell our shares through our President, who will receive no commissions. There is no guarantee that he will be able to sell any of the shares. Unless he is successful in selling at least 25% of the shares and we receive the proceeds in the amount of $30,000 from this offering, we may have to seek alternative financing to implement our business plan.
+
+Our shares of common stock are subject to the penny stock rules of the Securities and Exchange Commission and the trading market in our securities will be limited, which will make transactions in our stock cumbersome and may reduce the value of an investment in our stock. 
+
+The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks . Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules. If a trading market for our common stock develops, our common stock will probably become subject to the penny stock rules, and shareholders may have difficulty in selling their shares.
+
+There is no current trading market for our securities and if a trading market does not develop, purchasers of our securities may have difficulty selling their shares.
+
+There is currently no established public trading market for our securities and an active trading market in our securities may not develop or, if developed, may not be sustained. We intend to have a market maker apply for admission to quotation of our securities on the Over-the-Counter Bulletin Board after the Registration Statement relating to this prospectus is declared effective by the SEC. We do not yet have a market maker who has agreed to file such application. If for any reason our common stock is not quoted on the Over-the-Counter Bulletin Board or a public trading market does not otherwise develop, purchasers of the share may have difficulty selling their common stock should they desire to do so. No market makers have committed to becoming market makers for our common stock and none may do so.
+
+12 | Page
+
+Due to the lack of a trading market for our securities, you may have difficulty selling any shares you purchase in this offering. 
+
+ 
+
+We are not registered on any market or public stock exchange. There is presently no demand for our common stock and no public market exists for the shares being offered in this prospectus. We plan to contact a market maker immediately following the completion of the offering and apply to have the shares quoted on the Over-the-Counter Bulletin Board ( OTCBB ). The OTCBB is a regulated quotation service that displays real-time quotes, last sale prices and volume information in over-the-counter securities. The OTCBB is not an issuer listing service, market or exchange. Although the OTCBB does not have any listing requirements per se, to be eligible for quotation on the OTCBB, issuers must remain current in their filings with the SEC or applicable regulatory authority. If we are not able to pay the expenses associated with our reporting obligations we will not be able to apply for quotation on the OTC Bulletin Board. Market makers are not permitted to begin quotation of a security whose issuer does not meet this filing requirement. Securities already quoted on the OTCBB that become delinquent in their required filings will be removed following a 30 to 60 day grace period if they do not make their required filing during that time. We cannot guarantee that our application will be accepted or approved and our stock listed and quoted for sale. As of the date of this filing, there have been no discussions or understandings between Sand International Inc. and anyone acting on our behalf, with any market maker regarding participation in a future trading market for our securities. If no market is ever developed for our common stock, it will be difficult for you to sell any shares you purchase in this offering. In such a case, you may find that you are unable to achieve any benefit from your investment or liquidate your shares without considerable delay, if at all. In addition, if we fail to have our common stock quoted on a public trading market, your common stock will not have a quantifiable value and it may be difficult, if not impossible, to ever resell your shares, resulting in an inability to realize any value from your investment.
+
+We will incur ongoing costs and expenses for SEC reporting and compliance. Without revenues we may not be able to remain in compliance, making it difficult for investors to sell their shares, if at all. 
+
+ 
+
+The estimated cost of this registration statement is $8,000. We will have to utilize funds from Aliaksandr Savelyeu, our sole officer and director, who has verbally agreed to loan the company funds to complete the registration process. After the effective date of this prospectus, we will be required to file annual, quarterly and current reports, or other information with the SEC as provided by the Securities Exchange Act. We plan to contact a market maker immediately following the close of the offering and apply to have the shares quoted on the OTC Electronic Bulletin Board. To be eligible for quotation, issuers must remain current in their filings with the SEC. In order for us to remain in compliance we will require future revenues to cover the cost of these filings, which could comprise a substantial portion of our available cash resources. The costs associated with being a publicly traded company in the next 12 months will be approximately $10,000. If we are unable to generate sufficient revenues to remain in compliance it may be difficult for you to resell any shares you may purchase, if at all. Also, if we are not able to pay the expenses associated with our reporting obligations we will not be able to apply for quotation on the OTC Bulletin Board.
+
+Our management has no experience in running a public company. 
+
+Our sole director, Mr. Aliaksandr Savelyeu, never operated as a public company. He has no experience in complying with the various rules and regulations, which are required of a public company. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required of a public company. However, if we cannot operate successfully as a public company, your investment may be adversely affected. Our inability to operate as a public company could be the basis of your losing your entire investment in us.
+
+13 | Page
+
+FORWARD LOOKING STATEMENTS
+
+ 
+
+This prospectus contains
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001608293_beverly_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001608293_beverly_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..9b7fd7cbaed0e152f76747e89f32333ff8af55f9
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001608293_beverly_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1/A 1 d732497ds1a.htm S-1/A S-1/A Table of Contents As filed with the Securities and Exchange Commission on August 8, 2014 Registration No. 333-196509 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 4 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Beverly Financial, Inc. (Exact Name of Registrant as Specified in Its Charter) Massachusetts 6036 To be applied for (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 254 Cabot Street P.O. Box 498 Beverly, Massachusetts 01915 (978) 922-0857 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant s Principal Executive Offices) Michael R. Wheeler President and Chief Executive Officer 254 Cabot Street P.O. Box 498 Beverly, Massachusetts 01915 (978) 922-0857 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) Copies to: Richard A. Schaberg Gregory F. Parisi Hogan Lovells US LLP 555 Thirteenth Street, N.W. Washington, D.C. 20004 (202) 637-5600 Samantha M. Kirby Goodwin Procter LLP Exchange Place Boston, Massachusetts 02109 (617) 570-1000 Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: If this Form is filed to register additional shares for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents Summary The following summary explains the significant aspects of the mutual-to-stock conversion of Beverly Financial, MHC and the related offering of Beverly Financial, Inc. common stock. It may not contain all of the information that is important to you. For additional information before making an investment decision, you should read this entire document carefully, including the financial statements and
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001608469_imperial_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001608469_imperial_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001608469_imperial_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001609491_menono-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001609491_menono-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..f59c9e90fb2f452408b51b3262f7a3a63c9bbac3
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001609491_menono-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 5
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001609596_tide_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001609596_tide_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..25a42d643637bde782d0731e3f43946181d53e3e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001609596_tide_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1/A 1 tide-s1a1.htm FORM S-1 AMENDMENT NO. 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 Amendment No. 1 to FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 TIDE PETROLEUM CORP (Exact name of registrant as specified in its charter) Nevada 1311 47-0967384 (State or other jurisdiction of incorporation) (Primary Standard Industrial Classification Code Number) (IRS Employer Identification No.) 700 LOUISIANA ST, STE 3950 HOUSTON, TX 77002 Telephone: (1-832-390-2635 www.tidepetroleum.com (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Pubco Advisory Service 1812 4 Wedge Pkwy Reno, NV 89511 775-232-1950 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: John Smoot 700 Louisiana St, Ste 3950 Houston, TX 77002 1-832-390-2635 john .smoot @tidepetroleum.com Approximate Date of Commencement of Proposed Sale to the Public: From time to time after the date this registration statement is declared effective If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: ABOUT THIS PROSPECTUS This document does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, in any jurisdiction in which, or from any person to whom, it is unlawful to make any such offer or solicitation in such jurisdiction. The securities are not being offered in any jurisdiction where the offer of such securities is not permitted. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted or in which the person making that offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make an offer or solicitation. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date. You should read this prospectus and the registration statement of which this prospectus is a part in their entirety before making an investment decision. We further note that the representations, warranties and covenants made by us in any agreement that is filed as an exhibit to this prospectus were made solely for the benefit of the parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties to such agreement, and should not be deemed to be a representation, warranty or covenant to you. Moreover, such representations, warranties or covenants were accurate only as of the date when made. Accordingly, such representations, warranties and covenants should not be relied on as accurately representing the current state of our affairs. We are not making any representation to you regarding the legality of an investment in our securities by you under applicable law. You should consult with your own legal advisors as to the legal, tax, business, financial and related aspects of a purchase of our securities. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company (Do not check if a Smaller reporting company) CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Amount to be registered Proposed maximum offering price per unit Proposed maximum aggregate offering price(1) Amount of registration fee Common Stock, par value $0.001 per share 7,830,000 $ .10 $ 783,000 (1) $ 100.85 (1) Estimated solely for the purpose of computing the registration fee pursuant to Rule 457(o) under the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. (table of contents) The information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or the time of issuance or sale of any securities. In this prospectus, we refer to information regarding potential markets for our products and other industry data. We believe that all such information has been obtained from reliable sources that are customarily relied upon by companies in our industry. However, we have not independently verified any such information. The registration statement containing this prospectus, including the exhibits to the registration statement, provides additional information about us and the securities offered under this prospectus. The registration statement, including the exhibits, can be read on the Securities and Exchange Commission website or at the Securities and Exchange Commission offices mentioned under the heading "Where You Can Find More Information." PROSPECTUS SUMMARY The following summary provides an overview of certain information contained elsewhere in this prospectus. Because this is a summary, it does not contain all of the information you should consider before investing. Unless the context requires otherwise or unless otherwise noted, all references in this prospectus to "the Company," "TIDE PETROLEUM CORP" "TPC" "we," "us" or "our" are to TIDE PETROLEUM CORP Overview OUR COMPANY Tide Petroleum Corp ("We," "Us," "Our") was organized under the laws of the State of Nevada May 2, 2014. It is a Nevada corporation organized for the purpose of engaging in any lawful business with a current plan to engage in the acquisition, exploration, and if warranted, development of oil and gas prospects. We have not yet begun initial operations and are currently without revenue. We have one employee at the present time. We are in the developmental stage of our business, and we anticipate that operations will begin in late 2014 or early 2015 once we become a fully reporting company and gain access to the OTCBB. We are seeking to become a reporting issuer under the Securities Exchange Act of 1934, as amended, because we believe that this will provide us with greater access to capital, that we will become better known, and be able to obtain financing more easily in the future if investor interest in our business grows enough to sustain a secondary trading market in our securities. Additionally, we believe that being a reporting issuer increases our credibility and that we may be able to attract and retain more highly qualified personnel once we are not a shell company by potentially offering stock options, bonuses, or other incentives with a known market value. Our Auditors have issued a going concern opinion and the reasons noted for issuing the opinion are our lack of revenues and modest capital. Factors that make this offering highly speculative or risky are: There is no market for any securities; We have no revenues or sales; We are startup company; We have no experience in the energy exploration business as a company; We are undercapitalized. JUMPSTART OUR BUSINESS STARTUPS ACT We qualify as an "emerging growth company" as defined in Section 101 of the Jumpstart our Business Startups Act ("JOBS Act") as we do not have more than $1,000,000,000 in annual gross revenue and did not have such amount as of June 30, 2014, our last fiscal year. We may lose our status as an emerging growth company on the last day of our fiscal year during which (i) our annual gross revenue exceeds $1,000,000,000 or (ii) we issue more than $1,000,000,000 in non-convertible debt in a three-year period. We will lose our status as an emerging growth company if at any time we are deemed to be a The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED ____________________________, 2014 PROSPECTUS TIDE PETROLEUM CORP 2 ,830,000 SHARES OF COMMON STOCK OF SELLING SHAREHOLDERS AT $.10 We are registering 2 ,830,000 shares listed for sale on behalf of 3 8 selling shareholders. We will NOT receive any proceeds from sales of shares by selling shareholders. Our selling shareholders plan to sell common shares at $0.10 until such time as a market develops for any of the securities and thereafter at such prices as the market may dictate from time to time. There is no market price for the stock and our pricing is arbitrary with no relation to market value, liquidation value, earnings or dividends. The price was arbitrarily set at $0.10 per share, based on speculative concept unsupported by any other comparables. We have set the initial fixed prices as follows: TITLE PER SECURITY Common Stock $0.10 (table of contents) large accelerated filer. We will lose our status as an emerging growth company on the last day of our fiscal year following the fifth anniversary of the date of the first sale of common equity securities pursuant to an effective registration statement. As an emerging growth company, we may take advantage of specified reduced reporting and other burdens that are otherwise applicable to generally reporting companies. These provisions include: - A requirement to have only two years of audited financial statement and only two years of related Management Discussion and Analysis Disclosures: - Reduced disclosure about the emerging growth company's executive compensation arrangements; and - No non-binding advisory votes on executive compensation or golden parachute arrangements. As an emerging growth company, we are exempt from Section 404(b) of the Sarbanes-Oxley Act of 2002 and Section 14A(a) and (b) of the Securities Exchange Act of 1934. Such sections are provided below: Section 404(b) of the Sarbanes-Oxley Act of 2002 requires a public company's auditor to attest to, and report on, management's assessment of its internal controls. Sections 14A(a) and (b) of the Securities and Exchange Act, implemented by Section 951 of the Dodd-Frank Act, require companies to hold shareholder advisory votes on executive compensation and golden parachute compensation. We have already taken advantage of these reduced reporting burdens in this registration statement, which are also available to us as a smaller reporting company as defined under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As long as we qualify as an emerging growth company, we will not be required to comply with the requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002 and Section 14A(a) and (b) of the Securities Exchange Act of 1934. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities Act") for complying with new or revised accounting standards. We are choosing to irrevocably opt out of the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the JOBS Act. The Company intends to operate in an oil extraction capacity. The company intends to lease/purchase only oil producing properties. The most profitable method of extracting oil would be to lease an existing facility with the intent to extract deposits from the underlying soil. This manual method of precious oil acquisition would provide the greatest return on investment for the business. The Company, depending on its oil lease, may engage in deep oil extraction if the land is known to have a significant amount of oil/natural gas that is buried deep within the ground. TPC is also sourcing the necessary equipment so that the business can immediately begin its operations once an oil & gas lease has been acquired. We will not be buying equipment but renting/leasing on an as needed basis. The facility we select will also have all of the necessary chemical treatment to allow the business to distribute its oil deposits directly into the open market. (table of contents) At any time after a market develops, our security holders may sell their securities at market prices or at any price in privately negotiated transactions. THIS OFFERING INVOLVES A HIGH DEGREE OF RISK; SEE "RISK FACTORS" BEGINNING ON PAGE 5 TO READ ABOUT FACTORS YOU SHOULD CONSIDER BEFORE BUYING SHARES OF THE COMMON STOCK. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION (THE "SEC") OR ANY STATE OR PROVINCIAL SECURITIES COMMISSION, NOR HAS THE SEC OR ANY STATE OR PROVINCIAL SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. We intend to have an application filed on our behalf by a market maker for approval of common stock for quotation on the Over-the Counter/Bulletin Board quotation system tradable separately, subject to effectiveness of the Registration Statement. It has not yet been filed, nor is there any selected broker/dealer as yet. Our common stock is presently not listed on any national securities exchange or the NASDAQ Stock Market or any other venue. This offering will be on a continuous basis for sales of selling shareholders shares. The selling shareholders are not paying any of the offering expenses and we will not receive any of the proceeds from the sale of the shares by the selling shareholders (See "Description of Securities - Shares"). The information in this prospectus is not complete and may be changed. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. The date of this Prospectus is ____________________________, 2014. (table of contents) TIDE PETROLEUM CORP's corporate offices are located at 700 Louisiana St, Ste 3950, Houston, TX 77002 and its telephone number is 1-832-390-2635. Additional information about TIDE PETROLEUM CORP is included elsewhere in this prospectus. See the sections entitled "Business," " Management's Discussion and Analysis of Financial Condition and Results of Operations" and TIDE PETROLEUM CORP's financial statements. SUMMARY OF FINANCIAL INFORMATION TIDE PETROLEUM CORPORATION (A DEVELOPMENT STAGE COMPANY) BALANCE SHEET May 31, 2014 ASSETS Current Assets: Cash $53 Total Assets $53 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accrued liabilities $200 Total liabilities $200 Stockholders equity Common stock, $0.001 par value, 75,000,000 shares authorized; No shares issued and outstanding — Additional paid-in capital 100 Deficit accumulated during the development stage (247) Total stockholders equity $(147) Total liabilities and stockholders' equity $53 TIDE PETROLEUM CORPORATION (A DEVELOPMENT STAGE COMPANY) STATEMENT OF OPERATIONS For the Period From May 22, 2014 (Inception) to May 31, 2014 Sales $0 Cost of sales — Gross Profit — Operating expenses General and administrative 247 Total operating expenses 247 Loss before income taxes (247) Income (loss) before income taxes (247) Income taxes — Net (loss) $(247) Loss per common share-basic and diluted $0.00 Weighted average number of common shares outstanding-basic and diluted — (table of contents) THE OFFERING We are registering 2 ,830,000 shares listed for sale on behalf of 3 8 selling shareholders. ============================================================ ================== Common shares outstanding before this offering 7,830,000 ------------------------------------------------------------ ------------------ Maximum common shares being offered by selling shareholders 2 ,830,000 ============================================================ ================== We are authorized to issue 75,000,000 shares of common stock. Our current shareholders, officers and directors collectively own 7,830,000 shares of restricted common stock. These shares were issued at a price of $0.10 per share. There is currently no public market for our shares as it is presently not traded on any market or securities exchange. Risks Related to the Oil and Natural Gas Industry and Our Business in General Declining economic conditions and worsening geopolitical conditions could negatively impact our business (table of contents) Our operations can be affected by local, national and worldwide economic conditions. Markets in the United States and elsewhere have been experiencing extreme volatility and disruption for more than 5 years, due in part to the financial stresses affecting the liquidity of the banking system and the financial markets generally. The consequences of a potential or prolonged recession may include a lower level of economic activity and uncertainty regarding energy prices and the capital and commodity markets. In addition, actual and attempted terrorist attacks in the United States, Middle East, Southeast Asia and Europe, and war or armed hostilities in the Middle East, the Persian Gulf, North Africa, Iran, North Korea or elsewhere, or the fear of such events, could further exacerbate the volatility and disruption to the financial markets and economy. While the ultimate outcome and impact of the current economic conditions cannot be predicted, a lower level of economic activity might result in a decline in energy consumption, which may materially adversely affect the price of oil and gas, our revenues, liquidity and future growth. Instability in the financial markets, as a result of recession or otherwise, also may affect the cost of capital and our ability to raise capital. The oil and natural gas business involves numerous uncertainties and operating risks that can prevent us from realizing profits and can cause substantial losses. Our development, exploitation and exploration activities may be unsuccessful for many reasons, including weather, cost overruns, equipment shortages and mechanical difficulties. Moreover, the successful drilling of a well does not ensure a profit on investment. A variety of factors, both geological and market-related, can cause a well to become uneconomical or only marginally economical. In addition to their cost, unsuccessful wells can hurt our efforts to replace reserves. The oil and natural gas business involves a variety of operating risks, including: unexpected operational events and/or conditions; reductions in oil and natural gas prices; limitations in the market for oil and natural gas; adverse weather conditions; facility or equipment malfunctions; title problems; oil and gas quality issues; pipe, casing, cement or pipeline failures; natural disasters; fires, explosions, blowouts, surface cratering, pollution and other risks or accidents; environmental hazards, such as oil spills, pipeline ruptures and discharges of toxic gases; compliance with environmental and other governmental requirements; and uncontrollable flows of oil or natural gas or well fluids. If we experience any of these problems, it could affect well bores, gathering systems and processing facilities, which could adversely affect our ability to conduct operations. We could also incur substantial losses as a result of: injury or loss of life; severe damage to and destruction of property, natural resources and equipment; pollution and other environmental damage; clean-up responsibilities; regulatory investigation and penalties; suspension of our operations; and repairs to resume operations. Because we will use third-party drilling contractors to drill our wells, we may not realize the full benefit of worker compensation laws in dealing with their employees. Our insurance may not protect us against all operational risks. We will not carry business interruption insurance at levels that would provide enough funds for us to continue (table of contents) operating without access to other funds. For some risks, we may not obtain insurance if we believe the cost of available insurance is excessive relative to the risks presented. In addition, pollution and environmental risks generally are not fully insurable. If a significant accident or other event occurs and is not fully covered by insurance, it could impact our operations enough to force us to cease our operations. Drilling wells is speculative, and any material inaccuracies in our forecasted drilling costs, estimates or underlying assumptions will materially affect our business. Developing and exploring for oil and natural gas involves a high degree of operational and financial risk, which precludes definitive statements as to the time required and costs involved in reaching certain objectives. The budgeted costs of drilling, completing and operating wells are often exceeded and can increase significantly when drilling costs rise due to a tightening in the supply of various types of oilfield equipment and related services. Drilling may be unsuccessful for many reasons, including geological conditions, weather, cost overruns, equipment shortages and mechanical difficulties. Moreover, the successful drilling of an oil or gas well does not ensure a profit on investment. Exploratory wells bear a much greater risk of loss than development wells. Substantially all of TIDE PETROLEUM CORP's wells will be development wells. A variety of factors, both geological and market-related, can cause a well to become uneconomical or only marginally economic. Our initial drilling and development sites, may require significant additional exploration and development, regulatory approval and commitments of resources prior to commercial development. If our actual drilling and development costs are significantly more than our estimated costs, we may not be able to continue our business operations as proposed and would be forced to modify our plan of operation. Development of our reserves, when established, may not occur as scheduled and the actual results may not be as anticipated. Drilling activity and lack of access to economically acceptable capital may result in downward adjustments in reserves or higher than anticipated costs. Our estimates will be based on various assumptions, including assumptions over which we have no control and assumptions required by the SEC relating to oil and gas prices, drilling and operating expenses, capital expenditures, taxes and availability of funds. We have limited control over our operations that affect, among other things, acquisitions and dispositions of properties, availability of funds, use of applicable technologies, hydrocarbon recovery efficiency, drainage volume and production decline rates that are part of these estimates and assumptions and any variance in our operations that affects these items within our control may have a material effect on reserves. The process of estimating our oil and gas reserves is extremely complex, and requires significant decisions and assumptions in the evaluation of available geological, geophysical, engineering and economic data for each reservoir. Our estimates may not be reliable enough to allow us to be successful in our intended business operations. Our actual production, revenues, taxes, development expenditures and operating expenses will likely vary from those anticipated. These variances may be material. We must obtain governmental permits and approvals for drilling operations, which can result in delays in our operations, be a costly and time consuming process, and result in restrictions on our operations. Regulatory authorities exercise considerable discretion in the timing and scope of well drilling permit issuances in the region in which we operate. Compliance with the requirements imposed by these authorities can be costly and time consuming and may result in delays in the commencement or continuation of our exploration or production operations and/or fines. Regulatory or legal actions in the future may materially interfere with our operations or otherwise have a material adverse effect on us. In addition, we may be required to prepare and present to federal, state or local authorities data pertaining to the effect or impact that a proposed project may have on the environment, threatened and endangered species, and cultural and archaeological artifacts. Accordingly, the well drilling permits we need may not be issued, or if issued, may not be issued in a timely fashion, or may involve requirements that restrict our ability to conduct our operations or to do so profitably. Cost and availability of drilling rigs, equipment, supplies, personnel and other services could adversely affect our ability to execute on a timely basis our development, exploitation and exploration plans. Shortages or an increase in cost of drilling rigs, equipment, supplies or personnel could delay or interrupt our operations, which could impact our financial condition and results of operations. Drilling activity in the geographic areas in which we conduct drilling activities may increase, which would lead to increases in associated costs, including those related to drilling rigs, equipment, supplies and personnel and the services and products of other (table of contents) vendors to the industry. Increased drilling activity in these areas may also decrease the availability of rigs. We do not have any contracts for drilling rigs and drilling rigs may not be readily available when we need them. Drilling and other costs may increase further and necessary equipment and services may not be available to us at economical prices. Our exposure to possible leasehold defects and potential title failure could materially adversely impact our ability to conduct drilling operations. We obtain the right and access to properties for drilling by obtaining oil and natural gas leases either directly from the hydrocarbon owner, or through a third party that owns the lease. The leases may be taken or assigned to us without title insurance. There is a risk of title failure with respect to such leases, and such title failures could materially adversely impact our business by causing us to be unable to access properties to conduct drilling operations. We will operate in a highly competitive environment and our competitors may have greater resources than do we. The oil and natural gas industry is intensely competitive and we will compete with other companies, many of which are larger and have greater financial, technological, human and other resources. Many of these companies not only explore for and produce crude oil and/or natural gas, but also carry on refining operations and market petroleum and other products on a regional, national or worldwide basis. Such companies may be able to pay more for productive oil and properties and exploratory prospects or define, evaluate, bid for and purchase a greater number of properties and prospects than our financial or human resources permit. In addition, such companies may have a greater ability to continue exploration activities during periods of low oil and gas market prices. Our ability to acquire additional properties and to discover reserves in the future will be dependent upon our ability to evaluate and select suitable properties and to consummate transactions in a highly competitive environment. If we are unable to compete, our operating results and financial position may be adversely affected. Oil and natural gas prices are volatile. Future volatility may cause negative change in our cash flows which may result in our inability to cover our operating or capital expenditures. Our future revenues, profitability, future growth and the carrying value of our properties is anticipated to depend substantially on the prices we may realize for our oil and natural gas production. Our realized prices may also affect the amount of cash flow available for operating or capital expenditures and our ability to borrow and raise additional capital. Oil and natural gas prices are subject to wide fluctuations in response to relatively minor changes in or perceptions regarding supply and demand. Historically, the markets for oil and natural gas have been volatile, and they are likely to continue to be volatile in the future. Among the factors that can cause this volatility are: Commodities speculators; local, national and worldwide economic conditions; worldwide or regional demand for energy, which is affected by economic conditions; the domestic and foreign supply of oil and gas; weather conditions; natural disasters; acts of terrorism; domestic and foreign governmental regulations and taxation; political and economic conditions in oil producing countries, including those in the Middle East and South America; impact of the U.S. dollar exchange rates on oil prices; the availability of refining capacity; actions of the Organization of Petroleum Exporting Countries, or OPEC, and other state controlled oil companies relating to oil price and production controls; and the price and availability of other fuels. (table of contents) It is impossible to predict oil and gas price movements with certainty. A drop in prices may not only decrease our future revenues on a per unit basis but also may reduce the amount of oil and gas that we can produce economically. A substantial or extended decline in oil and gas prices may materially and adversely affect our future business enough to force us to cease our business operations. In addition, our reserves, financial condition, results of operations, liquidity and ability to finance and execute planned capital expenditures will also suffer in such a price decline. Lower prices for oil and natural gas reduce demand for our services and could have a material adverse effect on our revenue and profitability. Benchmark crude prices peaked at over $140 per barrel in July 2008 and then declined to approximately $92 per barrel at year-end 2012. During 2013, the benchmark for crude prices fluctuated between $85 per barrel and $110 per barrel. Demand for our services depends on oil and natural gas industry activity and expenditure levels that are directly affected by trends in oil and natural gas prices. In addition, demand for our services is particularly sensitive to the level of exploration, development and production activity of and the corresponding capital spending by, oil and natural gas companies. Any prolonged reduction in oil and natural gas prices could depress the near-term levels of exploration, development, and production activity. Perceptions of longer-term lower oil and natural gas prices by oil and natural gas companies could similarly reduce or defer major expenditures given the long-term nature of many large-scale development projects. Lower levels of activity result in a corresponding decline in the demand for our services, which could have a material adverse effect on our revenue and profitability. Additionally, these factors may adversely impact our financial position if they are determined to cause an impairment of our long-lived assets. Our business is affected by local, national and worldwide economic conditions and the condition of the oil and natural gas industry. Recent economic data indicates the rate of economic growth worldwide has declined significantly from the growth rates experienced in recent years. Current economic conditions have resulted in uncertainty regarding energy and commodity prices. In addition, future economic conditions may cause many oil and natural gas production companies to further reduce or delay expenditures in order to reduce costs, which in turn may cause a further reduction in the demand for drilling services. If conditions worsen, our business and financial condition may be adversely impacted. Our business is subject to numerous governmental laws and regulations, including those that may impose significant costs and liability on us for environmental and natural resource damages. Many aspects of our operations can be affected by governmental laws and regulations that may relate directly or indirectly to the contract drilling industry, including those requiring us to control the discharge of oil and other contaminants into the environment or otherwise relating to environmental protection. Countries where we might operate have environmental laws and regulations covering the discharge of oil and other contaminants and protection of the environment in connection with operations. Additionally, our operations and activities in the United States and its territorial waters will be subject to numerous environmental laws and regulations, including the Clean Water Act, the OPA, the Outer Continental Shelf Lands Act, the Comprehensive Environmental Response, Compensation and Liability Act, the Clean Air Act, the Resource Conservation and Recovery Act and MARPOL. Failure to comply with these laws and regulations may result in the assessment of administrative, civil and criminal penalties, the imposition of remedial obligations, the denial or revocation of permits or other authorizations and the issuance of injunctions that may limit or prohibit our operations. Laws and regulations protecting the environment have become more stringent in recent years and may in certain circumstances impose strict liability, rendering us liable for environmental and natural resource damages without regard to negligence or fault on our part. These laws and regulations may expose us to liability for the conduct of, or conditions caused by, others or for acts that were in compliance with all applicable laws at the time the acts were performed. The application of these requirements, the modification of existing laws or regulations or the adoption of new laws or regulations relating to exploratory or development drilling for oil and natural gas could (table of contents) materially limit future contract drilling opportunities or materially increase our costs. In addition, we may be required to make significant capital expenditures to comply with such laws and regulations. Changes in U.S. federal laws and regulations, or in those of other jurisdictions where we may operate, including those that may impose significant costs and liability on us for environmental and natural resource damages, may adversely affect our operations. If the U.S. government amends or enacts new federal laws or regulations, our potential exposure to liability for operations and activities in the United States and its territorial waters may increase. Although the Oil Pollution Act of 1990 provides federal caps on liability for pollution or contamination, future laws and regulations may increase our liability for pollution or contamination resulting from any operations and activities that the Company may have in the United States and its territorial waters including punitive damages and administrative, civil and criminal penalties. Additionally, other jurisdictions where we operate have modified, or may in the future modify, their laws and regulations in a manner that would increase our liability for pollution and other environmental damage. The loss of some of our key executive officers and employees could negatively impact our business prospects. Our future operational performance depends to a significant degree upon the continued service of key members of our management as well as marketing, sales and operations personnel. The loss of one or more of our key personnel could have a material adverse effect on our business. We believe our future success will also depend in large part upon our ability to attract, retain and further motivate highly skilled management, marketing, sales and operations personnel. We may experience intense competition for personnel, and we cannot assure you that we will be able to retain key employees or that we will be successful in attracting, assimilating and retaining personnel in the future. Failure to employ a sufficient number of skilled workers or an increase in labor costs could hurt our operations. We require skilled personnel to operate and provide technical services to, and support for, our drilling units. In periods of increasing activity and when the number of operating units in our areas of operation increases, either because of new construction, re-activation of idle units or the mobilization of units into the region, shortages of qualified personnel could arise, creating upward pressure on wages and difficulty in staffing. The shortages of qualified personnel or the inability to obtain and retain qualified personnel also could negatively affect the quality and timeliness of our work. In addition, our ability to expand operations depends in part upon our ability to increase the size of the skilled labor force. Risks Related to TIDE PETROLEUM CORP Ownership of our common stock is highly concentrated, and such concentration may prevent other stockholders from influencing significant corporate decisions and may result in conflicts of interest that could cause our stock price to decline. TIDE PETROLEUM CORP's directors and executive officers, together with their respective affiliates, beneficially own or control more than 64% of the Company (see the sections entitled "Principal Stockholders of TIDE PETROLEUM CORP" for more information on the estimated ownership of the company. Accordingly, these directors, executive officers and their affiliates, acting individually or as a group, have substantial influence over the outcome of a corporate action of requiring stockholder approval, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets or any other significant corporate transaction. These stockholders also may exert influence in delaying or preventing a change in control of the Company, even if such change in control would benefit the other stockholders of the Company. In addition, the significant concentration of stock ownership may affect adversely the market value of TIDE PETROLEUM CORP's common stock due to investors' perception that conflicts of interest may exist or arise. Anti-takeover provisions in our charter and bylaws may prevent or frustrate attempts by stockholders to change the board of directors or management and could make a third-party acquisition of the company difficult. (table of contents) Our articles of incorporation and bylaws, contain provisions that may discourage, delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which stockholders might otherwise receive a premium for their shares. These provisions could limit the price that investors might be willing to pay in the future for shares of our common stock. We may suffer losses or incur liability for events for which we or the operator of a property have chosen not to obtain insurance. Our operations are subject to hazards and risks inherent in producing and transporting oil and gas, such as fires, natural disasters, explosions, pipeline ruptures, spills, and acts of terrorism, all of which can result in the loss of hydrocarbons, environmental pollution, personal injury claims and other damage to our and others' properties. As protection against operating hazards, we maintain insurance coverage against some, but not all, potential losses. In addition, pollution and environmental risks generally are not fully insurable. As a result of market conditions, existing insurance policies may not be renewed and other desirable insurance may not be available on commercially reasonable terms, if at all. The occurrence of an event that is not covered, or not fully covered, by insurance could have a material adverse effect on our business, financial condition and results of operations. Our business depends in part on processing facilities owned by others. Any limitation in the availability of those facilities could interfere with our ability to market our oil and gas production and could harm our business. The marketability of our oil and gas production will depend in part on the availability, proximity and capacity of pipelines and oil processing facilities. The amount of oil and gas that can be produced and sold is subject to curtailment in certain circumstances, such as pipeline interruptions due to scheduled and unscheduled maintenance, excessive pressure, physical damage or lack of available capacity on such systems. The curtailments arising from these and similar circumstances may last from a few days to several months. In many cases, we will be provided only with limited, if any, notice as to when these circumstances will arise and their duration. Any significant curtailment in pipeline capacity or the capacity of processing facilities could significantly reduce our ability to market our oil and gas production and could materially harm our business. Our lease ownership may be diluted due to financing strategies we may employ in the future. To accelerate our development efforts, we may take on working interest partners who will contribute to the costs of drilling and completion operations and then share in any cash flow derived from production. In addition, we may in the future, due to a lack of capital or other strategic reasons, establish joint venture partnerships or farm out all or part of our development efforts. These economic strategies may have a dilutive effect on our lease ownership and could significantly reduce our operating revenues. We may face lease expirations on leases that are not currently held-by-production. We have numerous leases that are not currently held-by-production, some of which have near term lease expirations and are likely to expire. Although we believe that we can maintain our most desirable leases by conducting drilling operations or by negotiating lease extensions, we can make no guarantee that we can maintain these leases. We are subject to complex laws and regulations, including environmental regulations, which can adversely affect the cost, manner or feasibility of doing business. Development, production and sale of oil and gas in the United States are subject to extensive laws and regulations, including environmental laws and regulations. We may be required to make large expenditures to comply with environmental and other governmental regulations. Matters subject to regulation include, but are not limited to: location and density of wells; the handling of drilling fluids and obtaining discharge permits for drilling operations; accounting for and payment of royalties on production from state, federal and Indian lands; bonds for ownership, development and production of oil and gas properties; (table of contents) transportation of oil and gas by pipelines; operation of wells and reports concerning operations; and taxation. Under these laws and regulations, we could be liable for personal injuries, property damage, oil spills, discharge of hazardous materials, remediation and clean-up costs and other environmental damages. Failure to comply with these laws and regulations also may result in the suspension or termination of our operations and subject us to administrative, civil and criminal penalties. Moreover, these laws and regulations could change in ways that substantially increase our costs. Accordingly, any of these liabilities, penalties, suspensions, terminations or regulatory changes could materially adversely affect our financial condition and results of operations enough to possibly force us to cease our business operations. Our operations may expose us to significant costs and liabilities with respect to environmental, operational safety and other matters. We may incur significant costs and liabilities as a result of environmental and safety requirements applicable to our oil and gas production activities. We may also be exposed to the risk of costs associated with Kansas Corporation Commission, the Texas Railroad Commission, and the Colorado Oil and Gas Conservation Commission, requirements to plug orphaned and abandoned wells on our oil and gas leases that were previously drilled by third parties. In addition, we may indemnify sellers or lessors of oil and gas properties for environmental liabilities they or their predecessors may have created. These costs and liabilities could arise under a wide range of federal, state and local environmental and safety laws and regulations, including regulations and enforcement policies, which have tended to become increasingly strict over time. Failure to comply with these laws and regulations may result in the assessment of administrative, civil and criminal penalties, imposition of cleanup and site restoration costs, liens and to a lesser extent, issuance of injunctions to limit or cease operations. In addition, claims for damages to persons or property may result from environmental and other impacts of our operations. Strict, joint and several liabilities may be imposed under certain environmental laws, which could cause us to become liable for the conduct of others or for consequences of our own actions that were in compliance with all applicable laws at the time those actions were taken. New laws, regulations or enforcement policies could be more stringent and impose unforeseen liabilities or significantly increase compliance costs. If we are not able to recover the resulting costs through insurance or increased revenues, our ability to operate effectively could be adversely affected. Risks Related to our Business We have very little operating capital. The growth of our business will require additional investment. We do not presently have adequate cash from operations or financing activities to meet our long-term needs. As of May 31, 2014 we had a total of $53 in capital to use in executing our business plan. We anticipate that unless we are able to generate net revenue or raise net proceeds of at least $ 5 0,000 with a future offering within the next 12 months that it will be difficult to execute our business plan in a meaningful way. However, even if we were to raise or earn $ 5 0,000 there can be no assurance that we will be successful in executing our plan or achieving profitability. Due to our early stage of growth, regardless of the amount of funds we have, there is a substantial risk that all investors may lose all of their investment. We expect that we will seek additional financing in the future. However, we may not be able to obtain additional capital or generate sufficient revenues to fund our operations. Our independent auditor has expressed doubts about our ability to continue as a going concern. We are devoting substantially all of our present efforts in establishing a new business and we have achieved only minimal revenues. These factors, among others, raise substantial doubt about our ability to continue as a going concern. Management's plans regarding our ability to continue as a going concern are disclosed in Note 2 to the financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. (table of contents) Neither our sole officer nor either of our directors is required to continue as a shareholder and may not maintain an equity interest in the company in which case their interests may not mirror those of our shareholders. There is no requirement that our current officer or either of our current directors or any of our future officers and/or directors retain any of their shares of our common stock. Accordingly, there is no assurance that all or any of such current or future officers and/or directors will continue to maintain an equity interest in the company. Our current officer and directors currently intend to remain as an officer and directors of the company for the foreseeable future, even if they were to sell all or a portion of their shares. We are dependent on the services of our Chief Executive Officer and the loss of those services would have a material adverse effect on our business. We are highly dependent on the services of Dr. John Smoot, our Chief Executive Officer. Mr. John Smoot maintains responsibility for our overall corporate operational strategy. Mr. John Smoot has over 20 years experience in the oil & gas industry and the loss of his services would have a material adverse effect upon our business and prospects. Our CEO has no experience running a public company. This lack of experience could impact the results of our operations or return on investment, if any. As a result of our reliance on Mr. Smoot, and his lack of experience in operating a public company, our investors are at risk in losing their entire investment. Mr. Smoot does not presently intend to hire additional personnel. Unless and until such additional management is in place, we are reliant upon Mr. Smoot to make the appropriate management decisions. We will incur increased costs and demands upon management as a result of complying with the laws and regulations affecting public companies, particularly after if we cease being an "emerging growth company," which could adversely affect our business, operating results and financial condition. As a public company, and particularly if we cease to be an "emerging growth company," we will incur significant legal, accounting and other expenses that we did not incur as a private company. In addition, the Sarbanes-Oxley Act and rules subsequently implemented by the SEC and NASDAQ impose numerous requirements on public companies, including requiring changes to corporate governance practices. Also, the Exchange Act requires, among other things, that we file annual, quarterly and current reports with respect to our business and operating results. We will need to devote a substantial amount of time to compliance with these laws and regulations. These requirements have increased and will continue to increase our legal, accounting and financial compliance costs and have made and will continue to make some activities more time consuming and costly. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements in this prospectus, other than statements of historical facts, which address activities, events or developments that we expect or anticipate will or may occur in the future, including such things as future capital expenditures, growth, product development, sales, business strategy and other similar matters are forward-looking statements. You can identify forward-looking statements by terminology such as "may," "will," "would," "could," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue" or the negative of these terms or other similar expressions or phrases. These forward-looking statements are based largely on our current expectations and assumptions and are subject to a number of risks and uncertainties, many of which are beyond our control. Actual results could differ materially from the forward-looking statements set forth herein as a result of a number of factors, including, but not limited to, our products current state of development, the need for additional financing, changes in our business strategy, competition in various aspects of our business, the risks described under "Risk Factors" beginning on page[ ] of this prospectus and other risks detailed in our reports filed with the Securities and Exchange Commission, or the SEC. In light of these risks and uncertainties, all of the forward-looking statements made herein are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by us will be realized. We undertake no (table of contents) obligation to update or revise any of the forward-looking statements contained in this prospectus. All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements. USE OF PROCEEDS We will not receive any proceeds from the sale of securities being offered by our Selling Shareholders. DETERMINATION OF OFFERING PRICE Prior to this offering, there has been no market for our common stock. The offering price of the shares was arbitrarily determined and bears no relationship to assets, book value, net worth, earnings, actual results of operations, or any other established investment criteria. Among the factors considered in determining the price were our estimates of our prospects, the background and capital contributions of management, the degree of control which the current shareholders desire to retain, current conditions of the securities markets and other information. (table of contents) SELLING SECURITY HOLDERS The following table sets forth certain information with respect to the ownership of our common stock by Selling Shareholders as of the date of this Registration Statement. Unless otherwise indicated, none of the Selling Shareholders has or had a position, office or other material relationship with us within the past three years. None of our selling shareholders is a registered broker-dealer or an affiliate of a registered broker-dealer. Number of Shares Total Shares Owned by Selling Common to be Stockholder After Shares Registered Offering and Name of Selling Stockholder and Owned by Pursuant to Percentage of Percent of Total Position, Office or Material the Selling this Common Stock Issued and Relationship with Company (NA) Stockholder Offering Before Offering Outstanding(1) Aaron S Gill 10,000 10,000 * 0 Rajvindra S Gill 10,000 10,000 * 0 Jaswant S Gill 10,000 10,000 * 0 Ritika K Gill 10,000 10,000 * 0 Saumya Gill 10,000 10,000 * 0 Manjit S Gill 10,000 10,000 * 0 Barbara K Gill 10,000 10,000 * 0 Simran Family Limited Partnership (Aaron Gill, Rajvindra Gill, Jaswant Gill) 300,000 300,000 3% 0 Soburg Capital Group LLC (Manjit Gill, Barbara Gill) 15,000 15,000 * 0 Soburg Healthcare Investments LLC (Manjit Gill, Barbara Gill) 15,000 15,000 * 0 Soburg L.P. (Manjit Gill, Barbara Gill) 15,000 15,000 * 0 Sokhel Ltd. (Manjit Gill, Barbara Gill) 15,000 15,000 * 0 Woodlands Renal Care, L.P. (Manjit Gill, Barbara Gill) 10,000 10,000 * 0 Akerue, LLC (Manjit Gill, Barbara Gill) 15,000 15,000 * 0 GECAP Investments, LLC (Manjit Gill, Barbara Gill) 10,000 10,000 * 0 GECAP. Ltd (Manjit Gill, Barbara Gill) 10,000 10,000 * 0 Gill & Company, LLC (Manjit Gill, Barbara Gill) 10,000 10,000 * 0 Soburg Investments, LLC (Manjit Gill, Barbara Gill) 15,000 15,000 * 0 Perica Pejakov 200,000 200,000 2% 0 Rajpal Bains 30,000 30,000 * 0 Sukhjit Bains 30,000 30,000 * 0 Gaganjot Sandhu 200,000 200,000 2% 0 Jaswinder Sandhu 200,000 200,000 2% 0 Gurdarshan Mangat 100,000 100,000 1% 0 Parmeet Nanner 100,000 100,000 1% 0 RajinderGoyal 30,000 30,000 * 0 Don Edra 100,000 100,000 1% 0 Baldev Sandhu 30,000 30,000 * 0 Balkarandeep Bains 20,000 20,000 * 0 Jerry Dillahunty 250,000 250,000 3% 0 Gurnoor Bains 20,000 20,000 * 0 Mandeep Kaur 20,000 20,000 * 0 Augusta Energy LLC (Sharandeep Bains) 250,000 250,000 3% 0 Norcal Petroleum LLC (Balwinder Bains) 250,000 250,000 3% 0 Sukhwinder Bains 250,000 250,000 3% 0 John Smoot President - CEO 50,000 50,000 * 0 * Indicates less than 1% 1) Assumes that all shares are sold pursuant to this offering and that no other shares of common stock are acquired or disposed of by the Selling Shareholders prior to the termination of this offering. Because the Selling Shareholders may sell all, some or none of their shares or may acquire or dispose of other shares of common stock, no reliable estimate can be made of the aggregate number of shares that will be sold pursuant to this offering or the number or percentage of shares of common stock that each shareholder will own upon completion of this offering. (table of contents) 2) Mandeep Kaur is the daughter in law of Harprit Kaur Sharandeep Bains is the brother of Haprit Kaur. Sharandeep Bains of Augusta Energy, LLC and Balwinder Bains of Norcal Petroleum, LLC are husband and wife Balkarandeep Bains is Sharandeep Bains son and Gurnoor Bains is Sharandeep Bains daughter. Sukhwinder Bains is Sharandeep Bains mother. Parmeet Nanner is Harprit Kaur s husband s uncle and uncles daughter s son Rajpal Bains and Sukhjit Bains are husband and wife. Rajpal Bains is Harprit Kaur s first cousin Jaswinder Sandhu is Gaganjot Sandhu s mother Aaron S Gill is an individual Rajvindra S Gill s wife is Ritika Gill Jaswant Gill s wife is Saumya Gill Ritika Gill s husband is Rajvindra Gill Saumya Gill s husband isJaswant Gill Manjit Gill s wife is Barbara Gill Barbara Gill s husband is Manjit Gill Akerue, LLA is owned by Manjit Gill and Barbara Gill GECAP Investments, LLC is owned by Manjit Gill and Barbara Gill GECAP, Ltd is owned by Manjit Gill and Barbara Gill Gill & Company, LLC is owned by Manjit Gill, Aaron Gill, Rajvindra Gill, Jaswant Gill Simran Family Limited Partnership is owned by Manjit Gill, Barabara Gill, Aason Gill, Rajvindra Gill & Jaswant Gill Soburg Healthcare Investments, LLC is owned by Manjit Gill and Barbara Gill Soburg Investments, LLC is owned by Manjit Gill and Barbara Gill Soburg L.P. is owned by Manjit Gill and Barbara Gill Sokhel Ltd. is owned by Manjit Gill and Barbara Gill Woodlands Renal Care, L.P. is owned by Manjit Gill and Barbara Gill Simran & Associates LLC (GP of Simran Family Limited Partnership) is owned by Manjit Gill, Barbara Gill, indirect through Simran Family Limited Partnership (table of contents) PLAN OF DISTRIBUTION The Selling Shareholders will sell their shares at a price per share of $0.10. If and when our common stock becomes quoted on the OTCQB or the OTC Bulletin Board, the shares owned by the selling stockholders may be sold at prices and terms then prevailing or at prices related to the then-current market price, or in negotiated transactions. The Selling Shareholders may sell or distribute their common stock from time to time themselves, or by donees or transferees of, or other successors in interests to, the Selling Shareholders, directly to one or more purchasers or through brokers, dealers or underwriters who may act solely as agents or may acquire such common stock as principals. These sales by Selling Shareholders may occur contemporaneously with sales by us. The sale of the common stock offered by the Selling Shareholders through this prospectus may be affected in one or more of the following: * Ordinary brokers' transactions; * Transactions involving cross or block trades or otherwise * Purchases by brokers, dealers or underwriters as principal and resale by such purchasers for their own accounts pursuant to this prospectus; * in other ways not involving market makers or established trading markets, including direct sales to purchasers or sales effected through agents; * in privately negotiated transactions; or * any combination of the foregoing. Brokers, dealers, underwriters or agents participating in the distribution of the shares as agents may receive compensation in the form of commissions, discounts or concessions from the Selling Shareholders and/or purchasers of the common stock for whom such broker-dealers may act as agent, or to whom they may sell as principal, or both. The compensation paid to a particular broker-dealer may be less than or in excess of customary commissions. Neither we nor any selling shareholder can presently estimate the amount of compensation that any agent will receive. We know of no existing arrangements between any selling shareholder, any other shareholder, broker, dealer, underwriter or agent relating to the sale or distribution of the shares. In the event that we use an underwriter or a broker-dealer to consummate the sale of the shares we are registering for sale by the company, we will file a post-effective amendment to this registration statement setting forth the name of such entity and the terms under which such entity is participating in this offering. We will pay all expenses incident to the registration, offering and sale of the shares to the public, but will not pay commissions and discounts, if any, of underwriters, broker-dealers or agents, or counsel fees or other expenses of the Selling Shareholders. We have also agreed to indemnify the Selling Shareholders and related persons against specified liabilities, including liabilities under the Securities Act. We have advised the Selling Shareholders that while they are engaged in a distribution of the shares included in this prospectus they are required to comply with Regulation M promulgated under the Securities Exchange Act of 1934, as amended. With certain exceptions, Regulation M precludes the Selling Shareholders, any affiliated purchasers, and any broker-dealer or other person who participates in such distribution from bidding for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until the entire distribution is complete. Regulation M also prohibits any bids or purchases make in order to stabilize the price of a security in connection with the distribution of that security. All of the foregoing may affect the marketability of the shares offered hereby in this prospectus. DESCRIPTION OF SECURITIES TO BE REGISTERED Our authorized capital stock consists of 75,000,000 shares of common stock, par value $0.001 per share. As of the date of this prospectus, 7,830,000 shares of common stock were outstanding of which 7,830,000 are being registered. Common Stock We are authorized to issue 75,000,000 shares of our common stock, $0.001 par value, of which 7,830,000 shares are issued and outstanding as of the date of this prospectus. The issued and outstanding shares of common stock are fully paid and non-assessable. Except as provided by law or our certificate of incorporation with respect to voting by class or series, holders of common stock are entitled to one vote on each matter submitted to a vote at a meeting of shareholders. (table of contents) Subject to any prior rights to receive dividends to which the holders of shares of any series of the preferred stock may be entitled, the holders of shares of common stock will be entitled to receive dividends, if and when declared payable from time to time by the board of directors, from funds legally available for payment of dividends. Upon our liquidation or dissolution, holders of shares of common stock will be entitled to share proportionally in all assets available for distribution to such holders. None of our shareholders have any preemptive rights. Market for Common Equity and Related Stockholder Matters There is no established public market for our common stock and we have arbitrarily determined the offering price. Although we hope to be quoted on the OTCQB or the OTC Bulletin Board, our common stock is not currently listed or quoted on any quotation service. There can be no assurance that our common stock will ever be quoted on any quotation service or that any market for our stock will ever develop or, if developed, will be sustained. As of the date of this Prospectus, there are 39 shareholders of record of our common stock and a total of 7,830,000 shares outstanding. All shares of common stock registered pursuant to this Registration Statement will be freely transferable without restriction or registration under the Securities Act, except to the extent purchased or owned by our "affiliates" as defined for purposes of the Securities Act. Under certain circumstances, restricted shares may be sold without registration, pursuant to the provisions of rule 144. In general, under rule 144, a person (or persons whose shares are aggregated) who is not an affiliate of the issuer and who has beneficially owned, for at least one year, securities that have not been registered under the Securities Act or that were acquired from our "affiliate" (in a transaction or chain of transactions not involving a public offering) is entitled to sell such securities in specific manners, such as through unsolicited brokers transactions or to a market maker. If the issuer is subject to the reporting requirements of the Exchange Act for a minimum of ninety (90) days immediately before the sale, the one year holding period referenced above is reduced to six (6) months. Any sales of shares by shareholders pursuant to rule 144 may have a depressive effect on the price of our common stock. Transfer Agent and Registrar The transfer agent and registrar for TIDE PETROLEUM CORP common stock is West Coast Stock Transfer Co., Inc. LEGAL MATTERS None at this time EXPERTS Anton & Chia LLP has audited our Financial Statements for the period from May 22, 2014 (date of inception) through May 31, 2014 and to the extent set forth in its report, which are included herein in reliance upon the authority of said firm as experts in accounting and auditing. There were no disagreements related to accounting principles or practices, financial statement disclosure, internal controls or auditing scope or procedure from date of appointment as our independent registered accountant through the period of audit (inception May 22, 2014 through May 31, 2014). No expert or counsel named in this Prospectus as having prepared or certified any part thereof or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of our common stock was employed on a contingency basis or had or is to receive, in connection with the offering, a substantial interest, directly or indirectly, in us. Additionally, no such expert or counsel was connected with us as a promoter, managing or principal underwriter, voting trustee, director, officer or employee. (table of contents) Business Overview Summary Mission Statement The Company's operational focus is the acquisition, through the most cost effective means possible, of producing properties or near production of oil and natural gas field assets. Targeted fields generally have existing wells that are often past primary energy recovery, but whose enhancement through secondary and tertiary recovery methods could revitalize them. Targeted fields also have the availability of additional drilling sites. The Company seeks to have an inventory of existing wells to enhance and a number of new drilling sites to maintain growth, while increasing reserves and cash flow. The Company intends to operate in an oil extraction capacity. Prior to the onset of operations, TPC will have acquired an oil & gas lease on a property that is known to have oil deposits. At this time, it is unclear as to the method that the Company will use in order to extract oil. The most profitable method of extracting oil would be to lease an existing facility with the intent to extract deposits from the underlying soil. This manual method of precious oil acquisition would provide the greatest return on investment for the business. The Company, depending on its oil lease, may engage in deep oil extraction if the land is known to have a significant amount of oil/natural gas that is buried deep within the ground. TPC is also sourcing the necessary equipment leases so that the business can immediately begin its operations once the oil & gas lease has been acquired. The facility will also have all of the necessary chemical treatment to allow the business to distribute its oil deposits directly into the open market. Strategic and Market Analysis Economic Outlook Currently, the economic market condition in the United States is moderate. The meltdown of the sub prime mortgage market coupled with increasing gas prices has led many people to believe that the US is on the cusp of a double dip economic recession. This slowdown in the economy has also greatly impacted real estate sales, which has halted to historical lows. However, oil prices fluctuate almost on a daily basis. Industry Analysis Over the past several years, oil and gas companies have focused on making favorable investments and acquisitions in North American shale assets, oil sands, and the Gulf of Mexico s deep water in order to grow their reserves. The early stage of the North American energy renaissance was primarily an upstream exploration and production $395 billion in 2013. As E&P investment dollars flooded into North America, the midstream sector struggled to keep up with demands to move production from newly producing regions or to increase flows from currently producing regions. As we move into 2014, investments in the energy renaissance will continue to shift from the upstream sector to midstream infrastructure, refinery operations, and petrochemical facilities. Upstream operators will focus on harvesting value from recent discoveries and acquisitions through more efficient operations and the application of new technologies. Evidence of this spending shift is already being seen in company capital expenditure budgets. According to the Oil & Gas Journal s 2013 projections, upstream E&P capital spending in North America stayed flat over the past year, rising only slightly from $394.4 billion in 2012 to $394.8 billion in 2013, while midstream capital spending has surged 263 percent from just $12.8 billion in 2012 to $46.4 billion in 2013.3 Downstream capital spending is also ramping up with spending rising 11 percent in 2013 to $24.7 billion over 2012 and is up 60 percent from 2010 when capital spending was just $15.5 billion. (table of contents) Year-to-date analysis shows merger and acquisition (M&A) activity in the oil and gas industry is down 29 percent, both in deal value and deal count, indicating companies are focused on project operations rather than inorganic growth. As of the first half the year, total deal value in 2013 was just $79.9 billion, down from $113.2 billion in the first half of 2012.6 Part of the decline in M&A activity is a result of companies seeking to complete transactions in 2012 ahead of any potential tax increases in 2013. Furthermore, companies that have acquired large-acreage positions are now focused on optimizing production, streamlining operations, and maximizing the return on assets of their holdings. Natural gas prices have also firmed over the past year, giving potential sellers incentive to hold on to their assets and focus on production. As companies see rising liquefied natural gas (LNG) export approvals, a revitalization of the U.S. petrochemicals industry, increased demand from power generation, and growing adoption of natural gas for vehicle fleets, many natural gas-focused companies may hold on to their stakes waiting for prices to rise further. Marketing Plan The marketing campaigns required by Tide Petroleum Corp. are minimal as the business will sell its extracted oil directly to the open market. As such, it is imperative that any marketing expenditures undertaken by the Company focus on developing relationships with wholesalers and property management firms that will seek and lease land to Tide Petroleum Corp. Marketing Objectives Establish relationships with oil wholesalers within the targeted market. Develop relationships with specialty property management firms that will lease land to the business for its oil extraction operations. Marketing Strategies Prior to the onset of operations, TPC will develop ongoing purchase order relationships (based on market prices) with national and international energy product dealers and wholesalers that will acquire the Company s inventory of extracted oil. In order to complete this aspect of Oil Company s marketing operations, TPC will directly contact well known energy wholesalers. As these buyers are constantly searching for new sources, developing these relationships will not be an issue. Additionally, the Company will make its presence known among real estate agents and property management firms that specialize in the sale and placement of leases for land that is known to carry oil deposits. Much like with the oil wholesalers/dealers, TPC will directly contact these companies in order to develop working relationships. Management Team CEO Dr. John Smoot. Mr. Smoot has more than 20 years of exploration and finance experience. Through his expertise, he will be able to bring the operations of the business to profitability within its first year of operations. Employees We currently have one part-time employee, our CEO Mr. Smoot who will initially be devoting 20 hours per week to TPC (table of contents) Website Under construction Description of property Mr. Smoot is providing office space for the company at 700 Louisiana Street, STE 3950, Houston TX 77002 at no charge to the company. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND/FINANCIAL DISCLOSURE. We have had no disagreements with our accountants on accounting and financial disclosure. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS Market Information There is no established public market for our common stock and we have arbitrarily determined the offering price. Although we hope to be quoted on the OTCQB or the OTC Bulletin Board, our common stock is not currently listed or quoted on any quotation service. There can be no assurance that our common stock will ever be quoted on any quotation service or that any market for our stock will ever develop or, if developed, will be sustained. As of the date of this prospectus, there were 3 8 shareholders of record of our common stock and a total of 7,830,000 shares outstanding. Of the 7,830,000 shares of common stock outstanding, 5,050,000 shares of common stock are beneficially held by "affiliates" of the company. All shares of common stock registered pursuant to this Registration Statement will be freely transferable without restriction or registration under the Securities Act, except to the extent purchased or owned by our "affiliates" as defined for purposes of the Securities Act. Dividends To date, we have never declared or paid any cash dividends on our capital stock. We currently intend to retain any future earnings for funding growth and therefore, do not expect to pay any dividends in the foreseeable future. Payment of future dividends, if any, will be at the discretion of our Board of Directors after taking into account various factors, including our financial condition, operating results, current and anticipated cash needs and plans for expansion. There are no contractual restrictions on our ability to declare or pay dividends. PENNY STOCK RULES The U.S. Securities and Exchange Commission has also adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the Nasdaq system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). A purchaser is purchasing penny stock, which limits the ability to sell the stock. The shares offered by this prospectus constitute penny stock under the Exchange Act. The shares will remain penny stocks for the foreseeable future. The classification of penny stock makes it more difficult for a broker-dealer to sell the stock into a secondary market, which makes it more difficult for a purchaser to liquidate his/her investment. Any broker-dealer engaged by the purchaser for the purpose of selling his or her shares in us will be subject to Rules 15g-1 through 15g-10 of the Exchange Act. Rather than creating a need to comply with those rules, some broker-dealers will refuse to attempt to sell penny stock. (table of contents) The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document, which: Contains a description of the nature and level of risk in the market for penny stock in both public offerings and secondary trading; Contains a description of the broker s or dealer s duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements of the Securities Act; Contains a brief, clear, narrative description of a dealer market, including "bid" and "ask" price for the penny stock and the significance of the spread between the bid and ask price; Contains a toll-free number for inquiries on disciplinary actions; Defines significant terms in the disclosure document or in the conduct of trading penny stocks; and Contains such other information and is in such form (including language, type, size and format) as the Securities and Exchange Commission shall require by rule or regulation. The broker-dealer also must provide, prior to effecting any transaction in a penny stock, to the customer: The bid and offer quotations for the penny stock; The compensation of the broker-dealer and its salesperson in the transaction; The number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and Monthly account statements showing the market value of each penny stock held in the customer s account. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser s written acknowledgement of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement. These disclosure requirements will have the effect of reducing the trading activity in the secondary market for our stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficulty selling their securities. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of financial condition and results of operations together with the "Selected Historical Financial Data of TIDE PETROLEUM CORP" section of this prospectus and TIDE PETROLEUM CORP's financial statements and the related notes included in this prospectus. In addition to historical information, the following discussion contains forward-looking statements that involve risks, uncertainties and assumptions. TIDE PETROLEUM CORP's actual results could differ materially from those anticipated by the forward-looking statements due to important factors including, but not limited to, those set forth in the "Risk Factors—Risks Related to TIDE PETROLEUM CORP" section of this prospectus. (table of contents) Special Note Regarding Forward-Looking Statements This registration statement and other reports filed by our Company from time to time with the U.S. Securities and Exchange Commission (collectively the "Filings") contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, our management as well as estimates and assumptions made by our management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the filings, the words "anticipate," "believe," "estimate," "expect," "future," "intend," "plan," or the negative of these terms and similar expressions as they relate to us or our management identify forward-looking statements. Such statements reflect our current view with respect to future events and are subject to risks, uncertainties, assumptions, and other factors, including those set forth in "Risk Factors." Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results. Our financial statements are prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management s judgment in its application. There are also areas in which management s judgment in selecting any available alternative would not produce a materially different result. The following discussion should be read in conjunction with our financial statements and notes thereto appearing elsewhere in this report. Results of Operations For the period May 22, 2014 (Inception) to May 31, 2014 we generated $0 in revenue. We incurred $247 in expenses We anticipate our operating expenses will increase as we continue to implement our business plan. The increase will be attributable to expenses to implement our business plan, and the professional fees to be incurred in connection with the filing of a registration statement with the Securities Exchange Commission under the Securities Act of 1933. We anticipate our ongoing operating expenses will also increase once we become a reporting company under the Securities Exchange Act of 1934. Our independent registered public accountant has issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have generated no revenues and have incurred losses since inception. To meet our need for cash we intend to attempt raising money through the sale of equity or debt securities. We believe that our ability to do this will increase if we are a publicly reporting entity. We believe that we will be able to raise enough money to expand our operations but we cannot guarantee that we will do so, or that if we expand our operations that we will stay in business after doing so. If we need additional cash and cannot raise it, we will either have to suspend operations until we do raise the cash, or cease operations entirely. (table of contents) We do not currently have sufficient funds to satisfy our cash requirements during the next 12 months. If the need for cash arises before we raise additional funds from third parties, we may be able to borrow funds from our current officer or one of our current directors or from future officers or directors or from existing or future shareholders although there is no such formal agreement in writing. ACCOUNTING AND AUDIT PLAN We intend to continue to have our President prepare our quarterly and annual financial statements and have these financial statements reviewed or audited by our independent auditor. Our independent auditor is expected to charge us between $1,000 and $1,300 to review each of our quarterly financial statements and approximately $5,000 to audit our annual financial statements. In the next twelve months, we anticipate spending approximately $9,000 to pay for our accounting and audit requirements. SEC FILING PLAN We are not currently a reporting issuer and upon this registration statement becoming effective we will be required to comply only with the limited reporting obligations pursuant to Section 15(d) of the Exchange Act. These reporting obligations may be automatically suspended under Section 15(d) of the Exchange Act if on the first day of any fiscal year other than the fiscal year in which our registration statement became effective, there are fewer than 300 shareholders. We intend to become a reporting company in 2014 after our registration statement on Form S-1 is declared effective. This means that we will file documents with the United States Securities and Exchange Commission on a quarterly basis. If we do not become a reporting issuer and instead make a decision to suspend our public reporting, we will no longer be obligated to file periodic reports with SEC and your access to our business information will be restricted. In addition, if we do not become a reporting issuer, we will not be required to furnish proxy statements to security holders, and our directors, officer and principal beneficial owner will not be required to report their beneficial ownership of securities to the SEC pursuant to Section 16 of the Exchange Act. In the next twelve months, we anticipate spending approximately $12,000 for legal costs in connection with our three quarterly filings, annual filing, and edgarizing costs. Additionally, upon becoming a reporting company we will be required to comply with all applicable reporting requirements of the Exchange Act of 1934, which also include the filing of current reports on Form 8-K. LIQUIDITY AND CAPITAL RESOURCES At May 31, 2014, we had a cash balance of $53. Our expenditures over the next 12 months are expected to be approximately $50,000. Our current cash and net working capital balance is insufficient to cover our expenses for filing required quarterly and annual reports with the Securities and Exchange Commission and our status as a corporation in the State of Nevada for the next 12 months. We must raise approximately $50,000 to stay compliant as a reporting company and initiate our plan of operation for the next 12 months. Additional funding will likely come from equity financing from the sale of our common stock, if we are able to sell such stock or from loans. If we are successful in completing an equity financing, existing shareholders will experience dilution of their interest in our Company. We do not have any financing arranged and we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our development activities. In the absence of such financing, our business will fail. We believe that our ability to raise capital will increase if we become a publicly reporting entity. There are no assurances that we will be able to achieve further sales of our common stock or any other form of additional financing. If we are unable to achieve the financing necessary to continue our plan of operations, then we will not be able to continue our plan of operation for the next 12 months and our business will fail. OFF BALANCE SHEET ARRANGEMENTS We have no off-balance sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (table of contents) Use of estimates in the preparation of financial statements The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net revenue and expenses in the reporting period. Actual results could differ from those estimates. Revenue Recognition The Company is in the development stage and has yet to realize revenues from operations. Once the Company has commenced operations, it will recognize revenues when completion of services has occurred provided there is persuasive evidence of an agreement, acceptance has been approved by its customers, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is probable. Recent accounting pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard settling bodies that have an impact on the Company s accounting and reporting. The Company believes that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future either will not have an impact on its accounting or reporting or that such impact will not be material to its financial position, results of operations, and cash flows when implemented. Income Taxes ASC Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company has no material uncertain tax positions for any of the reporting periods presented. Income tax returns are subject to examination by major jurisdictions for the years 2010 through 2012. MANAGEMENT Directors, Executive Officers and Corporate Governance The following table and text sets forth the name, age and position held by our sole executive officer and director as of the date of this prospectus. Our directors serve until the next annual meeting of stockholders and until his successor is elected and qualified, or until his earlier death, retirement, resignation or removal. Executive officers serve at the discretion of the Board of Directors, and are elected or appointed to serve until the next Board of Directors meeting following the annual meeting of stockholders. Name Age Position John Smoot 53 Chief Executive Officer, Chief Financial Officer, Director Harprit Kaur 57 Director The biographies of our sole executive officer and of both directors are as follows: (table of contents) Business Experience: The principal occupation and business experience during the last five years for each of our directors and executive officers are as follows. Such information is based upon information received by us from such persons. Dr. John L. Smoot, CEO (53 years old) Ph.D and PMP with broad technical and management experience in geology as a principal geologist who specializes in deploying geologic software for 3D and 4D analysis, simulation and visualization of geospatial, petrophysical, seismic and borehole geophysical data to find and produce oil and gas and to guide E&P business execution. U.S. Citizen. Dr. Smoot is a licensed geologist with 25 years of technical and management experience in resource evaluation, business development and project management. He has managed large international projects in Russia and in the Ranger Uranium District of Australia s Northern Territory as well as in the US. Dr. Smoot has directed geologic evaluation, testing and reporting activities for Fortune 200-level and smaller companies. His expertise includes conceptualizing, characterizing and simulating subsurface deposits using geostatistics for Ag, Au, and U. He is a certified Project Management Professional with Spanish and Russian language skills. During the past three years, Dr. Smoot has provided technical oversight of an extensive drilling program for cleanup of contaminated groundwater, contributing to predictive simulations, well site selection, drilling plans, and data evaluation. He targeted optimal drilling locations by integrating simulation results with knowledge of existing structures and sedimentary features, retaining only the most strategic existing wells. The wells provided extraction/injection capacity for 800 and 600 gpm plants treating hexavalent chromium with SIR-700 ion exchange columns. Dr. Smoot s experience includes the development and testing of technical methods to better understand the relationship between data collected during drilling and spatial estimation models to enhance the resulting analyses conducted to identify grade distributions within deposits. His methodology has included the applicaton of three-dimensional geostatistics with modern three-dimensional computer visualization techniques to produce more accurate mineral reserve assessments. He uses ArcGIS and has worked with a Dynamic Graphics suite of subsurface analysis tools and is familiar with Micromine, Gemcon, Vulcan, acQuire, and other software. He has worked with Data Quality Objectives to ensure results of assays and laboratory analyses are sufficiently pedigreed to support mineral resource and reserve estimation using the industry standard software tools. His doctoral research focused on the comparison of modeling assessments of geologic parameters with kriged and interpolated data on the same spatial grid. Dr. Smoot participated in assessments of the fracture system at the Bunker Hill Mine, Kellogg, Idaho to define the source of water generating acid mine drainage. He conducted geophysical surveys and computer modeling of groundwater supply in the Pullman-Moscow Basin, in Washington and Idaho, for the U.S. Geological Survey. He analyzed multiple pay zones in the Williston Basin in Montana for Nance Petroleum Corporation, now part of SM Energy. Harprit Kaur- Director (57 Years Old) Harprit Kaur works with Twenty-Four Seven Food Stores as the President of the company for the past 5 years to present. Harprit has extensive management experience in production, drilling, and reservoir engineering, with total P/L responsibility for an independent oil/gas producer operating in the major domestic onshore basins and in coastal GOM waters. She also has technical knowledge and experience in new oil and gas industry technologies such as 3D seismic, horizontal drilling, and systems applications. (table of contents) Executive Compensation Summary Compensation Table The following table sets forth summary compensation information for the period ended from inception to year end June 30, 2014 for our chief executive officer. We refer to these persons as our named executive officers elsewhere in this report. Name and Principal Position Fiscal Year Salary ($) Bonus ($) Stock Awards ($) Option Awards ($) All Other Compensation ($) Total ($) John Smoot, Chief Executive Officer 2014 — — — — — — Equity Compensation Plans Employment Agreements John Smoot Number of Number of Number of Securities Securities Securities Underlying Underlying Underlying Unexercised Unexercised Unexercised Option Options Options Unearned Exercise Option Exercisable Unexercisable Options Price Expiration (#) (#) (#) ($) Date 0 0 0 0 0 (table of contents) Director Compensation The following table sets forth summary compensation information for the period ended June 30 , 2014, for each of our non-employee directors. Fees Earned Stock Option All Other or Paid in Cash Awards Awards Compensation Total Name $ $ $ $ $ Harprit Kaur 0 0 0 0 0 SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS The following table sets forth information as of October 2 , 2014 with respect to the beneficial ownership of our capital stock: each person known by TIDE PETROLEUM CORP that beneficially own more than five percent of any class of voting securities; each director of the Company; each named executive officer of the Company; and all directors and executive officers as a group. Percentage of beneficial ownership is calculated based on 7,830,000 shares of TIDE PETROLEUM CORP common stock outstanding. Percent of Outstanding Name and Address of Beneficial Owner (1) Number of Shares Shares of Common Stock John Smoot 50,000 0.01% Harprit Kaur 5,000,000 64.00% All Directors and Officers As a group (2 persons) 5,050,000 64.00% (1) As used in this table, "beneficial ownership" means the sole or shared power to vote, or to direct the voting of, security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of, or to direct the disposition of, a security). The address of each person is care of the Registrant, 700 Louisiana ST, Ste 3950, Houston, TX 77002 (table of contents) CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS Tide Petroleum s Director (Harprit Kaur) contributed the $100 to establish the bank account at the account s inception date of May 27, 2014. DESCRIPTION OF CAPITAL STOCK Authorized and Outstanding Capital Stock TIDE PETROLEUM CORP currently is authorized to issue 75,000,000 shares of common stock, $0.001 par value per share. Common Stock There are 7,830,000 shares of common stock issued and outstanding. Preferred Stock None authorized at this time Nevada Anti-Takeover Law As a Nevada corporation, TIDE PETROLEUM CORP is subject to Section 78.411 to 78.444 of the Nevada Revised Statutes. This law prohibits a publicly-held Nevada corporation from engaging in any business combination with any interested stockholder for a period of three years following the date that the stockholder became an interested stockholder unless: prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85 percent of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned by persons who are directors and also officers and by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or on or subsequent to the date of the transaction, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder. (table of contents) Section 78-416 of the Nevada Revised Statues defines "business combination" to include: any merger or consolidation involving the corporation and the interested stockholder; any sale, transfer, pledge or other disposition of 10 percent or more of the corporation's assets involving the interested stockholder; in general, any transaction that results in the issuance or transfer by the corporation of any of its stock to the interested stockholder; or the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation. Limitation of Liability and Indemnification TIDE PETROLEUM CORP's articles of incorporation contain certain provisions permitted under the Nevada Revised Statutes relating to the liability of directors. The provisions eliminate a director's liability for monetary damages for a breach of fiduciary duty, except in circumstances involving wrongful acts, such as the breach of a director's duty of loyalty or acts or omissions that involve intentional misconduct or a knowing violation of law. In addition, TIDE PETROLEUM CORP s articles of incorporation contain provisions to indemnify TIDE PETROLEUM CORP's directors and officers to the fullest extent permitted by the Nevada Revised Statutes. Transfer Agent and Registrar The transfer agent and registrar for TIDE PETROLEUM CORP common stock is West Coast Stock Transfer, Inc. EXPERTS Anton & Chia LLP has audited our Financial Statements for the period May 22, 2014 (date of inception) through May 31, 2014 and to the extent set forth in its report, which are included herein in reliance upon the authority of said firm as experts in accounting and auditing. There were no disagreements related to accounting principles or practices, financial statement disclosure, internal controls or auditing scope or procedure from date of appointment as our independent registered accountant through the period of audit (inception May 22, 2014 through May 31, 2014). No expert or counsel named in this Prospectus as having prepared or certified any part thereof or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of our common stock was employed on a contingency basis or had or is to receive, in connection with the offering, a substantial interest, directly or indirectly, in us. Additionally, no such expert or counsel was connected with us as a promoter, managing or principal underwriter, voting trustee, director, officer or employee (table of contents) WHERE YOU CAN FIND MORE INFORMATION We are a public company and file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission. You may read and copy any document we file at the SEC's Public Reference Room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You can request copies of these documents by writing to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for more information about the operation of the public reference room. Our SEC filings are also available to the public at the SEC's web site at http://www.sec.gov. We have filed with the SEC a registration statement on Form S-1, which includes exhibits, schedules and amendments, under the Securities Act, with respect to this offering of our securities. Although this prospectus, which forms a part of the registration statement, contains all material information included in the registration statement, parts of the registration statement have been omitted as permitted by rules and regulations of the SEC. We refer you to the registration statement and its exhibits for further information about us, our securities and this offering. The registration statement and its exhibits, as well as our other reports filed with the SEC, can be inspected and copied at the SEC s public reference room at 100 F Street, N.E., Washington, D.C. 20549-1004. The public may obtain information about the operation of the public reference room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains a web site at http://www.sec.gov, which contains the Form S-1 and other reports, proxy and information statements and information regarding issuers that file electronically with the SEC. No dealer, salesperson or any other person is authorized to give any information or make any representations in connection with this offering other than those contained in this prospectus and, if given or made, the information or representations must not be relied upon as having been authorized by us. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any security other than the securities offered by this prospectus, or an offer to sell or a solicitation of an offer to buy any securities by anyone in any jurisdiction in which the offer or solicitation is not authorized or is unlawful. (table of contents) FINANCIAL STATEMENTS INDEX TO FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm F-1 Balance Sheet F-2 Statement of Operations F-3 Statement of Changes in Stockholders Equity F-4 Statement of Cash Flows F-5 Notes to Financial Statements F-6 (table of contents) PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 13. Other Expenses of Issuance and Distribution. The following table sets forth the various expenses (other than discounts, commissions, and fees of underwriters, selling brokers, dealer managers or similar securities industry professionals ) to be incurred in connection with the offering of the securities being registered hereby, all of which will be borne by us. All of the amounts shown are estimated except the SEC registration fees. SEC registration fee $ 100.85 Legal fees and expenses $ 20,000 Accounting fees and expenses $ 4,000 Total $ 24,100.85 Item 14. Indemnification of Directors and Officers. Section 78.7502(1) of the Nevada Revised Statutes ("NRS") authorizes a Nevada corporation to indemnify any director, officer, employee, or corporate agent "who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation" due to his or her corporate role. Section 78.7502(1) extends this protection "against expenses, including attorneys fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful." Section 78.7502(2) of the NRS also authorizes indemnification of the reasonable defense or settlement expenses of a corporate director, officer, employee or agent who is sued, or is threatened with a suit, by or in the right of the corporation. The party must have been acting in good faith and with the reasonable belief that his or her actions were in or not opposed to the corporation's best interests. Unless the court rules that the party is reasonably entitled to indemnification, the party seeking indemnification must not have been found liable to the corporation. (table of contents) To the extent that a corporate director, officer, employee, or agent is successful on the merits or otherwise in defending any action or proceeding referred to in Section 78.7502(1) or 78.7502(2), Section 78.7502(3) of the NRS requires that he be indemnified "against expenses, including attorneys' fees, actually and reasonably incurred by him in connection with the defense." Unless ordered by a court or advanced pursuant to Section 78.751(2), Section 78.751(1) of the NRS limits indemnification under Section 78.7502 to situations in which either (1) the stockholders, (2) the majority of a disinterested quorum of directors, or (3) independent legal counsel determine that indemnification is proper under the circumstances. Section 78.751(2) authorizes a corporation's articles of incorporation, bylaws or agreement to provide that directors and officers expenses incurred in defending a civil or criminal action must be paid by the corporation as incurred, rather than upon final disposition of the action, upon receipt by the director or officer to repay the amount if a court ultimately determines that he is not entitled to indemnification. Section 78.751(3)(a) provides that the rights to indemnification and advancement of expenses shall not be deemed exclusive of any other rights under any bylaw, agreement, stockholder vote or vote of disinterested directors. Section 78.751(3) (b) extends the rights to indemnification and advancement of expenses to former directors, officers, employees and agents, as well as their heirs, executors, and administrators. Regardless of whether a director, officer, employee or agent has the right to indemnity, Section 78.752 allows the corporation to purchase and maintain insurance on his behalf against liability resulting from his or her corporate role. At present, there is no pending litigation or proceeding involving any director, officer, employee or agent as to which indemnification will be required or permitted under the Certificate. The Registrant is not aware of any threatened litigation or other proceedings that may result in a claim for such indemnification. (table of contents) Item 15. Recent Sales of Unregistered Securities The below referenced issuances of the Company s securities were not registered under the Securities Act of 1933, and we relied on exemptions pursuant to Regulation S promulgated under the Securities Act of 1933 for such issuance. All shares were offered @ $.10 per share and @ $.05 per share. Date Shareholder Total Shares 6/1/2014 John Smoot (CEO- DIRECTOR) 50,000 6/2/2014 Perica Pejakov 200,000 6/2/2014 Gurdarshan Mangat 100,000 6/4/2014 Rajinder Goyal 30,000 6/4/2014 Norcal Petroleum LLC (Balwinder Bains) 250,000 6/5/2014 Dallas Energy LLC (Harprit Kaur- DIRECTOR) 5,000,000 6/5/2014 Jerry Dillahunty 250,000 6/8/2014 Rajpal Bains 30,000 6/8/2014 Sukhjit Bains 30,000 6/8/2014 Baldev Sandhu 30,000 6/8/2014 Augusta Energy LLC (Sharandeep Bains) 250,000 6/10/2014 Sukhwinder Bains 250,000 6/12/2014 Don Edra 100,000 6/20/2014 Aaron S Gill 10,000 6/20/2014 Rajvindra S Gill 10,000 6/20/2014 Jaswant S Gill 10,000 6/20/2014 Ritika K Gill 10,000 6/20/2014 Saumya Gill 10,000 6/20/2014 Manjit S Gill 10,000 6/20/2014 Barbara K Gill 10,000 6/20/2014 Simran Family Limited Partnership (Aaron Gill, Rajvindra Gill, Jaswant Gill) 300,000 6/20/2014 Soburg Capital Group LLC (Manjit Gill, Barbara Gill) 15,000 6/20/2014 Soburg Healthcare Investments LLC( Manjit Gill, Barbara Gill) 15,000 6/20/2014 Soburg L.P. (Manjit Gill, Barbara Gill) 15,000 6/20/2014 Sokhel Ltd. (Manjit Gill, Barbara Gill) 15,000 6/20/2014 Woodlands Renal Care, L.P. (Manjit Gill, Barbara Gill) 10,000 6/20/2014 Akerue, LLC (Manjit Gill, Barbara Gill) 15,000 6/20/2014 GECAP Investments, LLC (Manjit Gill, Barbara Gill) 10,000 6/20/2014 GECAP. Ltd (Manjit Gill, Barbara Gill) 10,000 6/20/2014 Gill & Company, LLC (Manjit Gill, Barbara Gill) 10,000 6/20/2014 Soburg Investments, LLC (Manjit Gill, Barbara Gill) 15,000 6/25/2014 Gaganjot Sandhu 345,000 6/25/2014 Jaswinder Sandhu 55,000 6/25/2014 Parmeet Nanner 100,000 6/25/2014 Mandeep Kaur 20,000 6/25/2014 Balkarandeep Bains 20,000 6/25/2014 Gurnoor Bains 20,000 6/27/2014 Ben Meyer 200,000 (table of contents) Item 16 Exhibits and Financial Statement Schedules Exhibit No. Description of Exhibits Exhibit 3.1 Articles of Incorporation of the Company Exhibit 3.2(1) Bylaws of the Company Exhibit 5.1 Opinion of The Law Office of Novi & Wilkin Exhibit 23.1 Consent of The Law Office of Novi & Wilkin. (included in Exhibit 5.1). Exhibit 23.2 Consent of Anton & Chia. Exhibit 23.3 Resignation Letter (1) Incorporated by reference to our Registration Statement on Form S-1, File No. 333-198334. (table of contents) Item 17. Undertakings. The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, changes in the volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (table of contents) (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers, and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (table of contents) SIGNATURES Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Houston, State of Texas on November 17 , 2014. TIDE PETROLEUM CORP, a Nevada corporation By: /s/ John L. Smoot John L. Smoot Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated, on the dates indicated. Director and Chief Executive Officer /s/ John L. Smoot (Principal Executive Officer) John L. Smoot (CFO) (table of contents) TABLE OF CONTENTS Prospectus Summary 1
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+The following summary highlights certain information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and consolidated financial statements included elsewhere in this prospectus. Because this is only a summary, it may not contain all of the information that is important to you in making a decision to invest in our ordinary shares. Before making an investment decision, you should carefully read the entire prospectus, including the "Risk Factors" and "Important Information and Cautionary Statement Regarding Forward-Looking Statements" sections, our audited consolidated financial statements and the notes to those statements. Our Business We are one of the largest global eCommerce companies, with operations in Europe, Latin America, Asia and Africa. Among non-travel pure player eCommerce companies, we are the sixth largest by sales and the eighth largest by unique monthly visitors. Our current geographies represent over 530.0 million people, with 0.8 trillion ($1.0 trillion) in non-food total retail spend for the year ended December 31, 2013. For the same period, we had gross merchandise volume, or GMV, of 3,563.6 million ($4,500.1 million), representing a 21.4% increase over pro forma GMV for the year ended December 31, 2012, on a constant exchange rate basis. For the six months ended June 30, 2014, our GMV was 1,943.5 million ($2,454.3 million), representing a 32.9% increase over our GMV for the same period in 2013, on a constant exchange rate basis. For the three months ended September 30, 2014, our GMV was 1,100.8 million ($1,390.1 million), representing a 29.6% increase over our GMV for the same period in 2013, on a constant exchange rate basis. Over the seven quarters ended September 30, 2014, our GMV has shown year-over-year growth of 12.6%, 22.3%, 25.9%, 24.9%, 32.2%, 34.6% and 29.6%, on a constant exchange rate basis. We believe we provide our customers with the best value proposition through a low-cost business model that allows us to offer attractive pricing, an extensive product assortment and highly differentiated delivery and payment solutions. We achieve this through our scalable and proprietary technology platforms and preferred relationships with our Parent Companies, which are among the largest retailers in the markets in which we operate. As of September 30, 2014, we offered our over 12.9 million active customers access to a wide and growing assortment of approximately 12.0 million product offerings through a combination of our direct sales and sales by third-party vendors. Our 7.8 million placed orders in the three months ended September 30, 2014, represented a year-over-year increase of placed orders by 39.0%, while our active customers increased by 27.6% over the same period. Our most significant product categories in terms of GMV are home appliances, consumer electronics, computers and home furnishings. Our branded sites, including Cdiscount, Extra, Casas Bahia and Ponto Frio, are among the most well-recognized in the markets in which we operate. We are a leading eCommerce company in France, where we hold the leading eCommerce market position, with 24.0% to 39.7% market shares in June 2014, in a number of our product categories, based on revenues. From 2008 to 2013, our GMV in France experienced a compound annual growth rate, or CAGR, of 15.1%. We believe we are the second largest eCommerce company in Brazil, with a GMV CAGR of 49.3% from 2008 to 2013 and an increase in Brazilian market share from approximately 8.0% to approximately 17.0% during that period, based on revenues. For the six months ended June 30, 2014, our Brazilian market share had further increased to approximately 19.0%, based on revenues. During the first quarter of 2014, we successfully launched operations in the high-growth emerging eCommerce markets of Colombia, Thailand and Vietnam. In the second quarter of 2014, we launched operations in Ivory Coast and Ecuador, and in the third quarter of 2014, we launched operations in Senegal and extended operations to Belgium. In addition, we intend to expand into an additional African market by the end of 2014. Amendment No. 8 to FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents MARKET AND INDUSTRY DATA This prospectus includes estimates of market share and industry data and forecasts that we have obtained from industry publications, surveys and forecasts, as well as from internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable. This prospectus also includes market share and industry data that we have prepared primarily based on our knowledge of the industry in which we operate. While we believe the market position, market opportunity and market size information included in this prospectus is generally reliable, such information is inherently imprecise. In addition, our estimates, in particular as they relate to market share and our general expectations, involve risks and uncertainties and are subject to change based on various factors, including those discussed in the sections entitled "Important Information and Cautionary Statement Regarding Forward-Looking Statements" and "Risk Factors." All information regarding our market and industry is based on the latest data currently available to us, which in some cases may be several years old. In addition, some of the data and forecasts that we have obtained from industry publications and surveys and/or internal company sources are provided in foreign currencies. EXCHANGE RATES All references in this prospectus to "U.S. dollars" or "$" are to the legal currency of the United States, all references to " " or "euro" are to the currency introduced at the start of the third stage of the European economic and monetary union pursuant to the treaty establishing the European Community, as amended, and all references to the "real" or "R$" are to Brazilian reais, the official currency of the Federative Republic of Brazil, or Brazil. This prospectus contains translations of euro amounts into U.S. dollars at specific rates. Unless otherwise noted, all translations from euros to U.S. dollars and from U.S. dollars to euros in this prospectus were made at a rate of $1.2628 per euro, the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on September 30, 2014. The table below shows the period end, average, high and low exchange rates of U.S. dollars per euro for the periods shown. Average rates are computed by using the noon buying rate of the Federal Reserve Bank of New York for the euro on each business day during the relevant year indicated or each business day during the relevant month indicated. Year Ended December 31, High Low Average Year End 2009 1.5100 1.2547 1.3935 1.4332 2010 1.4536 1.1959 1.3261 1.3269 2011 1.4875 1.2926 1.3931 1.2973 2012 1.3463 1.2062 1.2859 1.3186 2013 1.3816 1.2774 1.3281 1.3779 Month High Low Average Month End May 31, 2014 1.3924 1.3596 1.3739 1.3640 June 30, 2014 1.3690 1.3522 1.3595 1.3690 July 31, 2014 1.3681 1.3378 1.3533 1.3390 August 31, 2014 1.3436 1.3150 1.3315 1.3150 September 30, 2014 1.3136 1.2628 1.2889 1.2628 October 31, 2014 1.2812 1.2517 1.2677 1.2530 The noon buying rate of the Federal Reserve Bank of New York for the euro on November 14, 2014 was $1.00 = 0.8004. Table of Contents Our business benefits from the relationships with our Parent Companies, which are part of the Casino Group, a leading global diversified retail group with total sales of 48.6 billion ($61.4 billion) for the year ended December 31, 2013. We benefit from joint purchasing power, as well as their brand recognition, local market expertise, retail brick-and-mortar stores and retail logistics infrastructure. This enables us, among other things, to offer competitive pricing and appealing customer services relative to our competitors, including our Click-and-Collect delivery option whereby our customers can select a nearby location to pick up their purchased products. Our more than 17,500 Click-and-Collect locations across the markets in which we operate provide us with a competitive advantage. For example, during the first nine months of 2014, in France, approximately 59% of our orders were delivered through Click-and-Collect, accounting for approximately 60% of our revenues in France. By virtue of the integration of our operations across our geographies, we expect to accelerate cross-selling opportunities, cost efficiencies and sharing of best practices, which we believe will be drivers of profitable growth. For example, we expect increased purchasing power with international suppliers as a result of the increased size and strength of our business, savings from the sharing of information technology, or IT, across our operations and opportunities for marketplace sellers and buyers to reach a wider audience. In addition, we expect to utilize the know-how and other experiences from the success of our French marketplace in order to develop and drive the profitability and traffic of our marketplaces in Brazil, Colombia and any other countries in which we may open marketplaces in the future. Similarly, we seek to leverage our expertise in data utilization to drive our profitability across the markets in which we operate. Our Industry Drivers Internet Penetration: Internet penetration across the globe is 35.7%, with the rates in the markets in which we operate ranging from 37.0% to 86.0%. Global Internet penetration rates are expected to increase in the coming years due to a variety of reasons, including further development of infrastructure and the rise in the use of Internet-enabled mobile devices. Shift from brick-and-mortar shopping to eCommerce: The eCommerce markets in the countries in which we operate represent 3.7% of the $1.2 trillion retail market in those countries and have experienced rapid growth over the past few years, with revenues increasing from $36.6 billion to $42.9 billion from 2011 to 2013. We believe eCommerce will benefit from customers' continued migration from brick-and-mortar stores to eCommerce based on lower prices, wider range of products, the ability to compare prices among sellers and the convenience of shopping anytime. Increasing mCommerce: mCommerce is an increasingly popular form of eCommerce, as evidenced by the mCommerce penetration rate in France having increased from 7.6% in 2012 to 9.0% in 2013, and is expected to increase to 12.2% by 2016. Similarly, the mCommerce penetration rate in Brazil is expected to increase from 4.0% in 2012 to 9.1% by 2016. Untapped potential in high-growth product categories: We expect certain product categories to experience particularly high growth due to low product adoption and low eCommerce penetration in the sale of such products. In Brazil, for the year ended December 31, 2012, only 38.5% and 1.8% of households owned a microwave and dishwasher, respectively. In France, we estimate that for the year ended December 31, 2013, eCommerce penetration for home products was less than 5.0%. Our Key Strengths We are one of the largest eCommerce companies in the world, and we seek to leverage the following competitive strengths: global eCommerce company combining scale with leadership positions in core markets and key categories across three continents; Cnova N.V. (Exact name of Registrant as specified in its charter) Table of Contents The table below shows the period end, average, high and low exchange rates of euros per real for the periods shown. Average rates are computed by using the foreign exchange reference rate as published by the European Central Bank on its website for the real on each business day during the relevant year indicated or each business day during the relevant month indicated. Year Ended December 31, High Low Average Year-End 2009 0.4011 0.3081 0.3628 0.3982 2010 0.4598 0.3828 0.4298 0.4509 2011 0.4585 0.3896 0.4303 0.4139 2012 0.4449 0.3613 0.3999 0.3699 2013 0.3955 0.3070 0.3507 0.3070 Month High Low Average Month-End May 31, 2014 0.3312 0.3205 0.3278 0.3299 June 30, 2014 0.3344 0.3220 0.3291 0.3333 July 31, 2014 0.3349 0.3291 0.3321 0.3316 August 31, 2014 0.3378 0.3265 0.3310 0.3378 September 30, 2014 0.3443 0.3182 0.3325 0.3245 October 31, 2014 0.3332 0.3110 0.3225 0.3256 The reference rate of the European Central Bank for the real on November 17, 2014 was R$1.00 = 0.3056. We make no representation that any euro, U.S. dollar or real amounts could have been, or could be, converted into U.S. dollars or euro, as the case may be, at any particular rate, at the rates stated above, or at all. The rates set forth above are provided solely for your convenience and may differ from the actual rates used in the preparation of the consolidated financial statements included in this prospectus and other financial data appearing in this prospectus. TRADEMARKS We have proprietary and licensed rights to trademarks used in this prospectus which are important to our business, many of which are registered under applicable intellectual property laws. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the " " or " " symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. Except for the trademarks and domain names licensed to us by our indirect shareholders CBD and Via Varejo, we do not intend our use or display of other companies' trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Each trademark, trade name or service mark of any other company appearing in this prospectus is the property of its respective holder. Table of Contents strong brand portfolio and loyal customer base, which drive significant unpaid traffic to our sites; best value proposition with attractive pricing, broad product assortment and convenient delivery and payment solutions; proven low-cost and cash generative business model; strong growth track record with significant margin expansion potential; highly scalable proprietary technology platforms with data monetization opportunities; and experienced, innovative and proven management team with a clear strategic vision. Our Strategies Our key focus is to accelerate profitable growth through the following strategies: continue to grow our direct sales business through attractive prices, enhanced customer experience and category expansion; grow our marketplaces across our markets by adding more sellers and products, driving traffic from our direct sales business and providing fulfillment services to marketplace sellers; establish our specialty sites as leaders in their respective product categories; leverage and monetize data, traffic and other activities; strengthen our mobile leadership; and continue our expansion into new attractive geographies. Risk Factors Investing in our ordinary shares involves substantial risk. The risks described under the heading "Risk Factors" immediately following this summary may cause us not to realize the full benefits of our strengths or may cause us to be unable to successfully execute all or part of our strategy. Some of the principal risks of investing in our ordinary shares include the following: competition presents an ongoing threat to the success of our business; if we fail to retain existing customers or acquire new customers, our business may not grow; if we are unable to benefit from the relationships with our Parent Companies, including their brand recognition, local market expertise, retail brick-and-mortar stores and retail logistics infrastructure, our business, financial condition and results of operations could be materially and adversely affected; if we are unable to achieve growth in the higher-margin areas of our business, including our marketplaces and home furnishings product category, it may have a material adverse effect on our business, financial condition and operating results; if we are unable to successfully expand our operations outside of our existing markets, our future business development and existing operations could be harmed; if we are unable to deliver compelling mobile shopping experiences to our customers and monetize traffic from such mobile activity, it could have a material effect on our business, financial condition and operating results; if we do not successfully optimize, operate and manage our fulfillment centers, our business, financial condition and operating results could be harmed; if we do not successfully protect our networks, systems and sites against security breaches, our reputation and brands could be damaged and our business and operating results could be substantially harmed; The Netherlands (State or other jurisdiction of incorporation or organization) 5961 (Primary Standard Industrial Classification Code Number) Not Applicable (I.R.S. Employer Identification Number) Professor Dr Dorgelolaan 30D 5613 AM Eindhoven The Netherlands +31 (0)40 250-2258 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) Table of Contents CERTAIN DEFINITIONS Unless the context indicates otherwise, references to "we," "our," "us," "Cnova" and "the Company" in this prospectus, refer to Cnova N.V. and its subsidiaries. Any reference to "our brands" or "our domain names" in this prospectus includes the brands "Cdiscount," "Extra," "Casas Bahia" and "Ponto Frio" and related domain names, which are either registered in the names of our Parent Companies or in the name of Cdiscount as more fully described herein. Additionally, unless the context indicates otherwise, the following definitions apply throughout this prospectus: Big C Supercenter Big C Supercenter plc and its subsidiaries Casino Casino, Guichard-Perrachon S.A. Casino Group Casino, Guichard-Perrachon S.A. and its subsidiaries and, where appropriate, the controlling holding companies of Casino, including Rallye S.A. and Euris S.A.S., which are ultimately controlled by our chairman Jean-Charles Naouri CBD Companhia Brasileira de Distribui o and its subsidiaries (together, commonly known as Grupo P o de A car, or GPA) Cdiscount Cdiscount S.A. and its subsidiaries Cdiscount Group Cdiscount Group S.A.S. (formerly Casino Entreprise S.A.S.) and its subsidiaries Dutch HoldCo Marneylectro B.V. (formerly Ja pur Financial Markets B.V.), a wholly owned subsidiary of Lux HoldCo, organized under Dutch law xito Almacenes xito S.A. and its subsidiaries Founding Shareholders Casino, CBD, Via Varejo, xito and, subject to the Double Voting Right Structure, certain current and former managers of Nova Pontocom. The interests of CBD, Via Varejo and the managers of Nova Pontocom in Cnova are held indirectly through Nova HoldCo, Lux HoldCo and Dutch HoldCo Lux HoldCo Marneylectro S. r.l. (formerly Ja pur Financial Markets S. r.l.), a wholly owned subsidiary of Nova HoldCo, organized under Luxembourg law Nova HoldCo Nova Pontocom Com rcio Eletr nico S.A., following the completion of the Reorganization (as defined on page 5 of this prospectus) Nova OpCo CNova Com rcio Eletr nico S.A., a wholly owned subsidiary of Cnova owning the Brazilian eCommerce businesses of CBD and Via Varejo following the completion of the Reorganization Nova Pontocom Nova Pontocom Com rcio Eletr nico S.A. and its subsidiaries, prior to completion of the Reorganization Parent Companies Big C Supercenter, Casino, CBD, xito and Via Varejo, each of which is an affiliate of Cnova Rallye Rallye S.A. and its subsidiaries Via Varejo Via Varejo S.A. and its subsidiaries Voting Depository Stichting Cnova Special Voting Shares Table of Contents if our sites are affected by significant interruptions or delays in service, it could result in loss of customers and vendors; we may not be able to maintain and enhance our brands, on which our business depends; we may not be able to successfully integrate our businesses and realize many of the anticipated benefits of the Reorganization; as a result of the Reorganization, the financial information and pro forma financial information presented in this prospectus does not necessarily reflect the results we would have achieved as an independent, publicly traded company or our future results; your ability to influence corporate matters will be limited, as control of Cnova will be concentrated with our Founding Shareholders; our intention to rely on exemptions from certain corporate governance requirements, as we will be a foreign private issuer and a "controlled company" within the meaning of the rules applicable to the NASDAQ Stock Market, or NASDAQ, as a result of which our shareholders will not have the same protections afforded to shareholders of companies that are subject to these NASDAQ corporate governance requirements; and the other risk factors set forth under the heading "Risk Factors." You should carefully consider all of the information included in this prospectus, including matters set forth under the headings "Risk Factors" and "Important Information and Cautionary Statement Regarding Forward-Looking Statements," before deciding to invest in our ordinary shares. Conventions Used in this Prospectus Unless the context otherwise requires, references in this prospectus to: "active customers" are customers who have made at least one purchase through our sites during the relevant 12-month measurement period; provided that, because we operate multiple sites, each with unique systems of identifying users, we calculate active customers on a website-by-website basis, which may result in an individual being counted more than once; "GMV" are gross merchandise volume derived from our product sales, marketplaces business volumes and other revenues, after returns, including taxes; "mCommerce" are product purchases made through mobile devices; "mobile devices" are Internet-enabled mobile phones and tablets; "product offerings" are the total number of products offered to our customers across all of our sites, taking into account direct sales and marketplace sales; "pure player eCommerce companies" are companies focused exclusively on eCommerce; "sites" are our computer websites, mobile websites and mobile applications; and "UMVs" are unique monthly visitors, which is the total number of unique users that visited our sites during any given month. Our Founding Shareholders Following the completion of this offering, it is expected that our Founding Shareholders will beneficially own 93.9% of our outstanding ordinary shares and 100% of our special voting depository receipts for our special voting shares, representing 96.9% of the voting power of all of our outstanding ordinary shares and special voting shares voting together as a single class, or, if the underwriters exercise in full their option to purchase additional ordinary shares, 93.0% of our ordinary shares and 100% of our special voting depository receipts for our special voting shares, representing 96.4% of the C T Corporation System 111 Eighth Avenue New York, New York 10011 (212) 894-8800 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents voting power of all of our outstanding ordinary shares and special voting shares voting together as a single class. As a result of this ownership and the provisions of the Special Voting Agreement, the Founding Shareholders will have control over votes on fundamental and significant corporate matters and transactions. So long as the Founding Shareholders own more than 50% of our voting power, we will be a "controlled company" under NASDAQ rules. Under NASDAQ rules, a listed company of which more than 50% of the voting power for the election of directors is held by an individual, a group or another company is a "controlled company" that is not required to comply with certain corporate governance requirements. We intend to rely on certain exemptions following the offering, and may rely on any of these exemptions for so long as we are a "controlled company." See "Risk Factors Risks Related to an Investment in Our Ordinary Shares" and "Certain Relationships and Related Party Transactions Agreements Relating to our Shares Special Voting Agreement." Corporate History and Information Cnova N.V. is a newly formed public limited liability company (naamloze vennootschap) organized under the laws of the Netherlands. On July 24, 2014, Cnova and the Parent Companies completed a reorganization of the eCommerce businesses of the Parent Companies in France and Latin America, and the reorganization of the Parent Companies' eCommerce businesses in Asia was completed on November 17, 2014, which transactions we collectively refer to as the Reorganization. As a result of the Reorganization, we own or have the right to use a majority of the assets that were used, or held for use, in the eCommerce businesses of the Parent Companies and their subsidiaries. Additional information with respect to the Reorganization is included in this prospectus under the heading "The Reorganization." Our principal places of business are located at Cdiscount S.A., 120-126, Quai de Bacalan CS 11584, 33067 Bordeaux Cedex, France, telephone number +33 5 55 71 45 00, and CNova Com rcio Eletr nico S.A., Rua Gomes de Carvalho 1609, Vila Olimpia 04547-006, S o Paulo SP, Brazil, telephone number +55 11 4949-8000. Our website address is www.cnovagroup.com. Information on, or accessible through, our website is not part of this prospectus. Enforcement of Civil Liabilities We are incorporated in the Netherlands, and conduct the substantial majority of our operations in France and Brazil through our subsidiaries. Service of process upon us and upon our directors and officers and certain experts named in this prospectus, substantially all of whom reside outside the United States, may be difficult to obtain within the United States. Furthermore, because substantially all of our assets and substantially all of our directors and officers are located outside the United States, any judgment obtained in the United States against us or any of our directors and officers may not be collectible within the United States. Even if you are successful in bringing an action in the United States, the laws of the Netherlands, France or Brazil may render you unable to enforce the U.S. judgment against our assets or the assets of our directors and officers. As there is no treaty on the reciprocal recognition and enforcement of judgments (other than arbitration awards) in civil and commercial matters between the United States and the Netherlands, between the United States and France, or between the United States and Brazil, courts in the Netherlands, France and Brazil will not automatically recognize and enforce a final judgment rendered by a U.S. court. In order to enforce a judgment in the Netherlands, France or Brazil, claimants must obtain leave to enforce the judgment from a Dutch, French or Brazilian court of competent jurisdiction, as applicable. For more information regarding the relevant laws of the Netherlands, France and Brazil, see "Enforcements of Civil Liabilities." Copies to: Joshua G. Kiernan, Esq. Colin J. Diamond, Esq. White & Case LLP 1155 Avenue of the Americas New York, New York 10036 Phone: (212) 819-8200 Fax: (212) 354-8113 Adam O. Emmerich, Esq. Gordon S. Moodie, Esq. Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 Phone: (212) 403-1000 Fax: (212) 403-2000 Phyllis G. Korff, Esq. Yossi Vebman, Esq. Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 Phone: (212) 735-3000 Fax: (212) 735-2000 (1)Casino is ultimately controlled by Jean-Charles Naouri, via Euris S.A.S. and other intermediate entities. See "Principal Shareholders." (2)The management shareholders of Nova HoldCo include Germ n Quiroga and other minority shareholders (1.8% and 2.0%, respectively). (3)Nova HoldCo holds its interest in Cnova through two wholly-owned intermediate holding entities, Lux HoldCo and Dutch HoldCo. See "The Reorganization." (4)The remaining 0.2% of the share capital consists of shares granted to managers and employees of Cdiscount under Cdiscount Group's performance shares program and are currently subject to lock-up obligations. The existing liquidity arrangements (consisting of put and call options) between Casino and minority shareholders have been transferred to Cnova. (5)Cdiscount Group holds its interests in Cdiscount LatAm and C-Asia, and part of its interest in Cdiscount Colombia S.A.S., or Cdiscount Colombia, through a wholly-owned intermediate entity, Cdiscount International B.V. Cdiscount Group holds its interest in Cdiscount Africa through a wholly-owned intermediate entity, Cdiscount Afrique S.A.S. (6)The remaining 0.4% of the share capital is indirectly held by Casino. (7)The 15% minority interest in Cdiscount Africa is held by Bollor Africa Logistics. The 49% minority interest in Cdiscount Colombia is held by xito. The 30% minority interest in Cdiscount LatAm is held by xito. The 40% minority interest in C-Asia is held by Big C Supercenter. The 30% minority interest in Cdiscount Thailand is held by Big C Supercenter. The 20% minority interest in Cdiscount Vietnam is held by a subsidiary of Casino. Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Amount to be registered(1) Proposed maximum offering price per share(2) Proposed maximum aggregate offering price(1)(2) Amount of registration fee(3) Ordinary shares, par value 0.05 per share 30,820,000 $14.00 $431,480,000 $51,398 (1)Includes shares issuable upon the exercise of the underwriters' option to purchase additional ordinary shares. (2)Estimated solely for the purpose of determining the amount of registration fee in accordance with Rule 457(a) under the Securities Act of 1933, as amended. (3)Previously paid. The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this registration statement shall become effective on such date as the U.S. Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine. Table of Contents
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+PROSPECTUS SUMMARY This section summarizes material information that appears later in this prospectus and is qualified in its entirety by the more detailed information and financial statements included elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. As an investor or prospective investor, you should carefully review the entire prospectus, including the risk factors and the more detailed information that appears later. Unless otherwise indicated, references to "Product Shipping Limited," the "Company," "we," "our," "us" or similar terms refer to the registrant, Product Shipping Limited, its predecessor HSM Products Limited, and Poseidon Product Tankers, except where the context otherwise requires. References to "Empire Navigation Inc.", "Empire" or our "Manager" refer to Empire Navigation Inc., a related party, except where the context otherwise requires. References to "Poseidon Product Tankers" are to the vessel-owning entities owned by AMCI Products Limited, which is wholly-owned by AMCI Poseidon Fund, L.P., and, from September 16, 2013, a 53.4% equity interest in HSM Products Limited acquired by AMCI Poseidon Fund, L.P. on that date. References to "MR Holding" are to MR Holding Limited, which immediately prior to the closing of this offering will be owned by AMCI Poseidon Fund, L.P. and an unaffiliated investment fund, and is the sole shareholder of the entities party to the memoranda of agreement to acquire the three MR product tankers in our Expansion Fleet. References to "LR Holding" are to LR Holding Limited, an entity newly formed by affiliates of ours that is party to the purchase option to acquire the LR1 product tanker Cape Talara. Please see " Our Corporate Structure" below. We use the term deadweight tons, or dwt, expressed in metric tons, each of which is equivalent to 1,000 kilograms, in describing the size of our vessels. Unless otherwise indicated, all references to "U.S. dollars," "dollars," "U.S. $" and "$" in this prospectus are to the lawful currency of the United States of America. See the "Glossary of Shipping Terms" included in this prospectus for definitions of certain terms used in this prospectus that are commonly used in the shipping industry. Except where we or the context otherwise indicate, the information in this prospectus assumes no exercise of the underwriters' over-allotment option described on the cover page of this prospectus. The Company We are an international shipping company that was incorporated in the Republic of the Marshall Islands in 2014 for the purpose of acquiring and operating a fleet of modern product tankers that provide seaborne transportation of refined petroleum products. We believe that growth in world trade and the distance of new sources of refinery capacity from primary areas of consumption create an opportunity for demand growth in the product tanker sector. By acquiring the vessels in our fleet at near historically low prices and operating them efficiently, we expect to be well positioned to benefit from a recovery in demand. We deploy our vessels predominately under time and bareboat charters, which generate stable cash flow and allow us to maintain high utilization rates, while preserving the flexibility to take advantage of higher charter rates as charters expire and renewal or spot charter opportunities arise. Our initial fleet will consist of 10 modern petroleum product tankers, consisting of eight Medium Range, or MRs, and two Long Range 1, or LR1s, with an aggregate carrying capacity of 543,090 dwt, and a dwt-weighted average age of approximately 6.7 years as of June 30, 2014. We refer to these vessels as our Initial Fleet. Each of the 10 vessels in our Initial Fleet is currently operating under time or bareboat charters with leading charterers including Trafigura Beheer BV, or Trafigura, Daelim H&L Co., Ltd., or Daelim, and Royal Dutch Shell plc, or Shell, or their respective subsidiaries, and, subject to satisfactory inspection by the charterer, two of these vessels will operate under time charters with a subsidiary of Petr leo Brasileiro S.A., or Petrobras, upon expiration of their current charters. We took delivery, through our predecessor, HSM Products Limited, and through Poseidon Product Tankers, of six of the vessels in our Initial Fleet in 2012 and four additional vessels in 2013 at a near historically low point in the shipping cycle, which we believe represented an attractive entry point for new investments in the product tanker AMENDMENT NO. 2 TO FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents sector. In addition, subsidiaries of MR Holding have entered into memoranda of agreement to acquire three MR product tankers, two built in 2008 and one in 2009, and related time charters back to the seller for a total purchase price of approximately $74.0 million, of which MR Holding has paid deposits totalling $7.4 million and is expected to fund the balance of the purchase price and take delivery of these vessels prior to the completion of this offering. We refer to the three MR product tankers as our Expansion Fleet. Unless indicated otherwise, references to our Combined Fleet are to our fleet of product tankers after giving effect to the purchase of the Expansion Fleet. If we do not acquire one or more of the vessels in our Expansion Fleet, we will have discretion to apply the proceeds of this offering that we intend to use to purchase those vessels to acquire other vessels or for other purposes. We will not escrow the proceeds from this offering and will not return the proceeds to you if we do not take delivery of such vessels. We believe that it is an opportune time to acquire secondhand product tankers, as values for such vessels remain near historical lows. We intend to continue to expand our fleet, beyond the vessels in our Expansion Fleet, through selective acquisitions of secondhand product tankers that we believe will be accretive to distributable cash flow and enhance our ability to pay dividends. Three of the vessels in our Combined Fleet are employed under long-term bareboat charters that we believe provide attractive levels of contracted revenues. However, we intend to employ our vessels, including the remaining 10 vessels in our Combined Fleet which are employed under charters expiring in 2014 through 2017, principally on multi-year time or bareboat charters, and we may also deploy vessels under spot charters particularly between multi-year charters when necessary or for repositioning purposes. We believe that our base of contracted revenues, the moderate leverage of no more than 40% of the net book value of our vessels we intend to maintain after this offering and our operational efficiency will allow us to apply a substantial portion of our cash flow to the payment of dividends to our shareholders. Stamatis Molaris, our Chief Executive Officer and Chairman, leads our management team and has over 20 years of experience in the shipping industry. Mr. Molaris is currently the Chairman and Chief Executive Officer of Alma Maritime Ltd., or Alma Maritime, a privately held shipping company, and previously was the chief executive officer of two publicly traded shipping companies, Quintana Maritime Limited, formerly listed on NASDAQ, and Excel Maritime Carriers, Ltd., which is listed on the NYSE, and the chief financial officer of Stelmar Shipping Ltd., formerly listed on NYSE. Mr. Molaris has advised the Company that, within three months following the closing of this offering, he intends to resign his position as Chief Executive Officer of Alma Maritime and remain as its non-executive Chairman. Empire Navigation Inc., which we also refer to as our Manager or Empire, and which provides commercial management for our fleet and technical management for all but one of our vessels, has a management and operational team comprised of executive officers who have an average of 29 years of experience in the shipping industry. We believe that the experience and reputation of our management team will assist us in identifying, acquiring and operating suitable vessels for the expansion of our fleet. Our principal shareholders are AMCI Poseidon Fund L.P., or AMCI Poseidon Fund, which focuses on investments in the shipping industry and whose principals include Mr. Molaris and Hans J. Mende, a founder of American Metals & Coal International, Inc., or AMCI, and Maas Capital Investments B.V., or Maas Capital, the private equity affiliate of ABN AMRO Bank N.V., a leading lender to the shipping industry. We intend to use approximately $39.1 million of the net proceeds from this offering to fund a portion of the aggregate purchase price for the three MR product tankers we intend to acquire. In addition, we intend to use approximately $97.6 million of the net proceeds from this offering to repay part of the outstanding indebtedness under our existing credit facilities. We have obtained commitment letters from Credit Suisse AG for four separate new credit facilities, subject to definitive documentation, for the refinancing of the expected remaining outstanding balance under our existing credit facilities, and for the financing of the remaining $27.5 million aggregate purchase price for our Expansion Fleet. We expect to enter into these new credit facilities on or prior to the consummation of this offering. We will acquire each of the vessels in our Initial Fleet and the three vessels in our Expansion Fleet concurrently with this offering through a share exchange agreement between us and our shareholders Product Shipping Limited (Exact name of Registrant as specified in its charter) Republic of The Marshall Islands (State or other jurisdiction of incorporation or organization) 4412 (Primary Standard Industrial Classification Code Number) Not Applicable (I.R.S. Employer Identification No.) c/o Empire Navigation Inc. 88 Vouliagmenis Avenue Elliniko 16777, Greece +30 211 10 24 000 (Address and telephone number of Registrant's principal executive offices) (1)The charterer has the option to purchase the vessel for $40.0 million at the bareboat charter termination date, upon six months' prior notice. (2)The charterer has a one-year renewal option at a charter rate of $15,600 per day. This vessel was formerly known as the Miss Marilena until it was renamed on January 4, 2014 following its acquisition by Poseidon Product Tankers. (3)We have arranged time charters for MR Kentaurus and MR Sirius with a subsidiary of Petrobras, subject to satisfactory vessel inspection by the charterer, for a charter period of three years to commence upon expiration of the vessels' current charters, at a gross daily charter rate of $14,900. (4)MR Arcturus is on a fixed charter with Shell for an initial period of at least 18 months and up to 24 months, with the first 12 months at $14,625 per day, and the second 12 months at $14,850 per day. If the charterer elects the full 24-month initial charter period, the charterer may exercise an option for a 12-month renewal period at a rate of $15,750 per day. (5)LR Mimosa is on a fixed charter with Panamax International Inc. for an initial period ending in January 2016, with the period from May 2014 through June 2015 at $14,500 per day and the period from July 2015 through January 2016 at $14,750 per day. The charterer has a one-year renewal option at a charter rate of $16,000 per day. Our Expansion Fleet The following table summarizes certain information about our Expansion Fleet as of the date of this prospectus: Vessel Name Type Year Built Expected Delivery Date Capacity (dwt) Shipyard Charterer Charter Type Gross Daily Charter Rate (U.S. dollars) Expiration of Charter (earliest) 1 Marlin Topaz MR 2009 October 2014 50,000 Guangzhou, China Trafigura Time Charter $ 15,700 October 2017 (1) 2 Marlin Glory MR 2008 October 2014 50,000 Guangzhou, China Trafigura Time Charter $ 15,700 October 2017 (1) 3 Marlin Iris MR 2008 October 2014 50,000 Guangzhou, China Trafigura Time Charter $ 15,700 October 2017 (1) Total Vessels (1)The charterer has a one-year renewal option at a charter rate of $16,200 per day and a second one-year renewal option at a charter rate of $16,700 per day. We will also have an option to purchase the entity owning the 2010-built LR1 Cape Talara from an unaffiliated third party for a purchase price of $39.5 million ($1.0 million of this amount is payable upon the completion of this offering) exercisable on or prior to December 31, 2014. The option requires us to pay $1.0 million upon the completion of the offering with such amount to be credited to the vessel purchase price if we exercise the option. The Cape Talara is employed on a bareboat charter to BB Cape Table of Contents Our Expansion Fleet The following table summarizes certain information about our Expansion Fleet as of the date of this prospectus: Vessel Name Type Year Built Expected Delivery Date Capacity (dwt) Shipyard Charterer Charter Type Gross Daily Charter Rate (U.S. dollars) Expiration of Charter (earliest) 1 Marlin Topaz MR 2009 October 2014 50,000 Guangzhou, China Trafigura Time Charter $ 15,700 October 2017(1) 2 Marlin Glory MR 2008 October 2014 50,000 Guangzhou, China Trafigura Time Charter $ 15,700 October 2017(1) 3 Marlin Iris MR 2008 October 2014 50,000 Guangzhou, China Trafigura Time Charter $ 15,700 October 2017(1) Total Vessels CT Corporation System 111 Eighth Avenue New York, NY 10011 Tel.: (212) 590-9338 (Name, address and telephone number of agent for service) Note: (1)An entity affiliated with Stamatis Molaris has entered into an agreement to acquire such vessel. Our right of first offer with respect to such vessel will only be exercisable if such acquisition is completed. (2)Such vessel is owned by Alma Maritime. The time charter attached to the vessel is at a base gross daily charter rate at $12,275 per day. The first $1,200 above the base rate is to be split 90/10 between owners and charterer, respectively. Any amount exceeding $13,475 per day is to be split 50/50. (3)Such vessel is owned by AMCI Poseidon Fund. (4)Such vessel is owned by an affiliate of Maas Capital and is currently employed on a bareboat charter from such entity to LR Aldebaran, an affiliate of Stamatis Molaris. LR Aldebaran, in turn, has employed the vessel on a time charter to Vitol. During the term of the bareboat charter, LR Aldebaran has a right of first refusal to acquire such vessel if the current owner elects to sell it. LR Aldebaran has agreed to exercise such right of first refusal pursuant to our instructions during the term of the charter. The current owner of the vessel has also granted us a right of first offer with respect to such vessel, exercisable following the term of the bareboat charter. We cannot assure you whether or on what terms such vessels may became available to us in the future. We expect to fund the estimated $66.6 million cash portion of the acquisition cost for the vessels in our Expansion Fleet through a combination of debt and equity financing. We expect $39.1 million of the purchase price of the three vessels in our Expansion Fleet to be funded with a portion of the net proceeds to us from this offering and to issue shares of our common stock to the owners of MR Holding pursuant to the Exchange Agreement. We have obtained commitment letters from Credit Suisse AG for up to $200.0 million of senior secured debt financing, of which up to $150.0 million is available to finance the remaining portion of the aggregate purchase price of the three vessels in our Expansion Fleet and the Cape Talara for which we have a purchase option and to refinance the expected remaining outstanding balance under our existing credit facilities after the application of the net proceeds of this offering. We expect to use $27.5 million under this facility to finance the remaining cash portion of the aggregate purchase price for the three vessels in our Expansion Fleet and $91.1 million to refinance the expected remaining outstanding balance under our existing credit facilities after the application of the net proceeds of this offering. These credit facilities are subject to completion of satisfactory definitive documentation and other customary conditions. Our Manager Empire was founded in February 2009 by Stamatis Molaris, our Chairman and Chief Executive Officer, and is jointly owned by affiliates of the Company. Empire has been carrying out the commercial and technical management of our fleet since the commencement of our operations, other than the Copies to: Allan D. Reiss Finnbarr D. Murphy Morgan, Lewis & Bockius LLP 101 Park Avenue New York, NY 10178 Tel.: (212) 309-6000 Fax: (212) 309-6001 Andrew J. Pitts D. Scott Bennett Cravath, Swaine & Moore LLP 825 Eighth Avenue New York, NY 10019 Tel.: (212) 474-1000 Fax: (212) 474-3700 Table of Contents technical management of the FR8 Venture, which has continued to be performed by Thome Shipmanagement Pte Ltd. since we acquired the vessel. Empire will provide the strategic, commercial and technical management of our fleet under the supervision of our management team and Board of Directors, pursuant to our management agreement with Empire. In return for providing technical and commercial services, our Manager will receive a fee of $750 per vessel per day commencing upon delivery of a vessel to us. This fee will be $350 per day for vessels that are deployed on bareboat charters. These fees will increase annually at a rate of 2.0%. In addition, Empire will provide us with accounting, banking, financial and administrative services and we will reimburse Empire for its actual costs in providing such services to us. Empire has established a management and operational team with significant experience in the shipping industry and relationships with reputable charterers and shipyards. Empire has been vetted to operate vessels with a number of major energy companies, including current charterers such as Shell and a pending charterer, Petrobras, as well as companies with whom we do not currently employ any vessels, such as BHP Billiton Ltd., or BHP, BP, Chevron Corporation, or Chevron, ConocoPhillips, Exxon Mobil Corporation, or Exxon, Lukoil, OMV Aktiengesellschaft, or OMV, Repsol S.A., or Repsol, Statoil, and Valero Energy Corporation, or Valero. We believe that Empire's reputation as a technical and commercial manager and its ability to comply with our customers' ship management standards allow us to compete effectively for new charters. In addition to the vessels in our fleet, Empire provides commercial and technical management services for four Suezmax crude oil tankers and one product tanker in the fleet of Alma Maritime, and one Suezmax crude oil tanker owned by AMCI Poseidon Fund, one product tanker owned by Maas Capital and the MR built in 2009 that is a sister vessel to certain of the MRs in our Initial Fleet which is owned by a wholly-owned subsidiary of AMCI Poseidon Fund, and the LR1 built in 2011 that is a sister vessel to the LR1 in our Expansion Fleet, which is subject to an acquisition agreement held by LR Troy Limited, an entity affiliated with Stamatis Molaris. During the term of the Management Agreement, our Manager will not provide any management services to any other entity with respect to product tankers without the prior written approval of the Audit Committee of our board of directors, other than with respect to the four product tankers it currently manages for Alma Maritime, Maas Capital and AMCI Poseidon Fund, services provided with respect to product tankers offered to us for acquisition and declined by our Audit Committee or product tankers owned by commercial lenders. Mr. Molaris will agree to equivalent restrictions on his direct or indirect involvement in the management of product tankers. Pursuant to a restriction on competition agreement that will be entered into prior to the completion of this offering, Mr. Molaris will agree, during the period that he is an executive officer or director of our company or, during the term of our Management Agreement with Empire, owns at least 10% of the outstanding equity interests in Empire, to restrictions on his ownership of any product tankers and on the acquisition of any shareholding in, or service as an officer, director or employee of, a business involved in the ownership of product tankers, subject to certain limited exceptions, including for product tankers offered to us and declined by our Audit Committee. Alma Maritime has agreed that, in the event of any proposed sale of the product tanker owned thereby, we will have a right of first offer to purchase such vessel. The product tanker owned by an affiliate of Maas Capital is currently employed on a bareboat charter to LR Aldebaran, an affiliate of Stamatis Molaris, until June 2018. LR Aldebaran has a right of first refusal to acquire such vessel pursuant to the terms of such charter. LR Aldebaran has agreed to exercise such right of first refusal pursuant to our instructions during the term of the charter. Maas Capital has agreed that, following the term of the charter, we will have a right of first offer with respect to such vessel in the event of any proposed sale thereof. The AMCI Poseidon Fund and LR Troy Limited have each agreed that, in the event of any proposed sale of the MR built in 2009 or the 2011-built LR1, respectively, we will have a right of first offer to purchase such vessel. See "Our Manager, Management-Related Agreements and Non-Competition Arrangements." Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Source: Drewry CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Proposed Maximum Aggregate Offering Price(1)(2) Amount of Registration Fee(3)(4) Common Stock, $0.01 par value per share $100,000,000 $12,880 (1)Includes shares that may be sold pursuant to the underwriters' over-allotment option. (2)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended. (3)Calculated in accordance with Rule 457(o) under the Securities Act, as amended. (4)Previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents Our Competitive Strengths We believe that we possess a number of competitive strengths, including: Experienced Manager and Management Team with Established Track Record. Our Manager and management team have substantial experience operating in the product tanker sector. Stamatis Molaris, our Chairman and Chief Executive Officer, has over 20 years of experience in the international shipping industry. Mr. Molaris is currently Chief Executive Officer and Chairman of Alma Maritime, an international shipping company which owns a fleet of crude oil and drybulk carriers as well as one product tanker, a position he has held since May 2008, and the founder of our Manager, Empire Navigation, which has developed an experienced management and operational team since being established in 2009. Mr. Molaris has advised the Company that, within three months following the closing of this offering, he intends to resign his position as Chief Executive Officer of Alma Maritime and remain as its non-executive Chairman. Mr. Molaris formerly was Chief Executive Officer of Quintana Maritime Limited, formerly a NASDAQ-listed drybulk company, Chief Executive Officer of Excel Maritime Carriers Ltd., a NYSE-listed drybulk company, following its acquisition of Quintana Maritime Limited, and Chief Financial Officer of Stelmar Shipping Ltd., formerly a NYSE-listed tanker company. Mr. Molaris is supported by Stewart Crawford, who has served as our Chief Financial Officer since our inception. Mr. Crawford is currently Chief Financial Officer of Alma Maritime, a position he has held since February 2010. Previously Mr. Crawford served as Chief Financial Officer of Atlas Maritime Holding Inc., an Athens-based tanker shipping company, from 2008 to February 2010. Mr. Crawford has advised the Company that, within three months following the closing of this offering, he intends to resign his position as Chief Financial Officer of Alma Maritime. We believe that their relationships with shipping companies, charterers, shipyards, brokers and commercial lenders, as well as our management team's reputation and track record in building shipping fleets, should provide us with access to attractive acquisition, chartering and vessel financing opportunities. Modern Secondhand Fleet. Our Initial Fleet consists of 10 modern product tankers, consisting of eight MR product tankers and two LR1 product tankers, built at leading shipyards principally in Korea, that we acquired in the secondhand market at a near historically low point in the shipping cycle. The dwt-weighted-average age of our Initial Fleet was 6.7 years as of June 30, 2014, compared to the industry average of 11.9 years for MR tankers greater than 25,000 dwt and 7.4 years for LR1 tankers according to Drewry. In addition, we plan to further expand our fleet through the purchase of three 2008- or 2009-built MR product tankers, which have contractual delivery dates in October 2014. Each of the MR product tankers in our Combined Fleet is capable of carrying chemicals, palm and other vegetable oils and fats, in addition to refined petroleum products, which provides us with the flexibility to secure employment for these vessels with traders and end-users of these varied cargoes. We believe that owning a modern, well-maintained and versatile fleet reduces operating costs, improves safety and provides us with a competitive advantage in securing favorable charters. Established Counterparties. The vessels in our Initial Fleet are currently operating under time and bareboat charters with reputable charterers including Trafigura, Daelim and Shell. Empire has successfully completed the required vetting process with a number of other major energy companies, including BHP, BP, Chevron, ConocoPhillips, Exxon, Lukoil, OMV, Repsol, Statoil and Valero and remains in compliance with the standards necessary to enable us to employ our vessels with these companies. Stable Cash Flows and Flexibility to Capture Upside. We have deployed our fleet of product tankers in a manner that provides us with the benefits of stable cash flows and high utilization rates, while preserving some opportunity to profit from the shipping cycle through improving charter rates during stronger charter markets. As of June 30, 2014, the average remaining time and bareboat charter duration for our Combined Fleet of 13 product tankers was 2.2 years, based on the remaining fixed terms and assuming the earliest redelivery dates possible under our charters, and we believe that the six vessels in our fleet with charters expiring in 2014 and 2015 give us the flexibility to take advantage of any recovery in Table of Contents Subject to Completion Dated September 23, 2014 PROSPECTUS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Shares Product Shipping Limited COMMON STOCK Table of Contents product tanker charter rates. As of June 30, 2014, these fixed rate charters represented approximately $158.2 million of contracted revenue through June 2019 and contracted employment for 96% and 58% of our anticipated ownership days for the remainder of 2014 and 2015, respectively. We intend to employ our available vessels principally on multi-year time or bareboat charters, and we may also deploy vessels under spot charters particularly between multi-year charters when necessary or for repositioning purposes. Reliable and Efficient Vessel Operations. We believe that our Manager's experience with the commercial and technical management of vessels and its reputation in the industry as an operator with high safety and quality operating standards will be important to attracting charterers that seek reliable and responsible operators to meet their exacting standards for vessel chartering and day-to-day operations. Low Leverage and Financial Flexibility. After giving effect to this offering and the expected use of proceeds therefrom, we will have an initial leverage ratio, which we define as the ratio of total debt to the book value of our vessels, of approximately % which is consistent with our current strategy of maintaining a leverage ratio that does not exceed 40% of the net book value of our assets. We believe that our capital structure will allow us to pursue accretive vessel acquisitions and explore various ways to maximize shareholder value and grow our distributable cash flow and enhance our ability to pay dividends. Our Business Strategies Our strategy is to be a reliable, efficient and responsible provider of seaborne refined petroleum product transportation services and to manage and expand our company in a manner that we believe will enable us to increase our distributable cash flow, enhance our ability to pay dividends and maximize value to our shareholders. We intend to realize these objectives by pursuing the following strategies: Focus on Product Tankers. Our primary focus is the acquisition and operation of medium and large-sized product tanker vessels. We believe it is an opportune time to acquire product tankers, as asset values for product tankers are currently near historical lows. We believe that industry dynamics, such as the relative size of the MR and LR1 orderbooks to the existing fleet and changing geography of oil refinery capacity, create a positive outlook for the product tanker sector. We intend to leverage our Manager's and management's industry experience and customer relationships to identify product tanker investment opportunities that we believe will be accretive to distributable cash flow and enhance our ability to pay dividends. Expand Our Fleet Opportunistically by Capitalizing on Attractive Prices. Vessel values in the product tanker sector are currently near historically low levels. We intend to grow our fleet through selective vessel acquisitions, using a disciplined approach to acquisition opportunities focused on modern secondhand vessels, which we believe currently provide better return characteristics than newbuildings. When evaluating acquisitions, we will consider and analyze, among other things, our expectation of fundamental developments in the product tanker shipping industry sector, the level of liquidity in the resale and charter market, the cash flow the vessel may generate in relation to its value, its condition and technical specifications with particular regard to fuel consumption, expected remaining useful life, the credit quality of the charterer and duration and terms of charter contracts for vessels acquired with charters attached, as well as the overall diversification of our fleet and customers. Although our competitors may also have established relationships with potential charterers and other industry participants, some of which may have greater financial strength and capital resources than we do, we believe that these circumstances present an opportunity for us to grow our fleet by acquiring vessels at favorable prices. Optimize Fleet Deployment. We intend to employ our available vessels principally on multi-year time or bareboat charters, and we may also deploy vessels under spot charters particularly between multi-year charters when necessary or for repositioning purposes. The vessels in our Initial Fleet are currently employed under time and bareboat charters, which provide us with the benefits of stable cash flows and high utilization rates. We will continue to monitor the product tanker sector and employ our vessels Product Shipping Limited is offering shares of its common stock. This is our initial public offering and no public market currently exists for our shares. We anticipate that the initial public offering price will be between $ and $ per share. Table of Contents according to our assessment of market conditions, to capture upside opportunities through improving charter rates during stronger charter markets, while using longer-term fixed rate charters to assure a strong base of stable revenue and thereby reduce downside risk. Maintain Cost-Competitive, Scalable Operations. We believe that our arrangements with Empire allow us to closely monitor the quality of our operations and contain operating costs through Empire's provision of commercial, technical and administrative services to us at a cost lower than what could be achieved by performing these functions in-house and at rates that are competitive with those that would be available to us through independent vessel management companies. We believe this external management arrangement will enhance the scalability of our business by allowing us to grow our fleet without incurring significant additional overhead costs. Leverage Our Manager's and Management's Experience and Relationships. We believe that major international commodity companies seek transportation providers that are financially stable and have a reputation for reliability, safety, and high environmental and quality standards. We intend to leverage the operational expertise and customer base of our Manager and of our executive officers and directors, including Stamatis Molaris, in order to further expand these relationships with consistent delivery of superior customer service. We believe these relationships with leading charterers, financing sources and shipping industry participants will facilitate the growth and employment of our fleet. Maintain a Strong Balance Sheet through Moderate Use of Leverage. We intend to use approximately $39.1 million of the net proceeds from this offering to fund a portion of the aggregate purchase price for the three MR product tankers we have agreed to acquire. Furthermore, we intend to use approximately $97.6 million of the net proceeds from this offering to repay part of the outstanding indebtedness under our existing credit facilities. We will seek to finance any future vessel acquisitions mainly with equity and to a lesser extent with debt, as we currently intend to maintain a moderate level of leverage of no more than 40% of the net book value of our vessels, which we believe will enhance our ability to apply a substantial portion of our cash flow to the payment of dividends to our shareholders. Charterers have increasingly favored financially solid vessel owners, and we believe that our expected balance sheet strength will enable us to access more favorable chartering opportunities, as well as give us a competitive advantage in pursuing vessel acquisitions from commercial banks and shipyards, which have also recently displayed a preference for contracting with better capitalized counterparties. Dividend Policy While we cannot assure you that we will continue to do so, and subject to the limitations discussed below, we currently intend to pay our stockholders quarterly dividends of $ per share, or $ per share per year, in February, May, August and November of each year, beginning in February 2015. We expect that the dividends we intend to pay to stockholders following the completion of this offering will represent a significant portion of our cash flows from operations during the previous quarter, after paying expenses and establishing reserves for drydockings, special surveys, capital expenditures, debt service and other purposes as our board of directors may from time to time determine are appropriate. We cannot assure you that we will be able to pay regular quarterly dividends, and our ability to pay dividends will be subject to the restrictions set forth in our credit facilities and the provisions of Marshall Islands law, as well as the other limitations described in the sections of this prospectus titled "Our Dividend Policy" and "Risk Factors." Our Shareholders Our principal shareholders are AMCI Poseidon Fund and Maas Capital. Following the closing of this offering, and assuming the underwriters do not exercise their option to purchase additional shares of common stock, AMCI Poseidon Fund and Maas Capital will own % and % of our outstanding We have applied to list our common stock on the NASDAQ Global Select Market under the symbol "PROS". Table of Contents pursuant to which we will exchange shares of our common stock in exchange for all of the outstanding shares of the holding companies which own the vessels in our Initial Fleet and shares of our common stock and $66.6 million for all of the outstanding shares of MR Holding, which is expected to take delivery of the vessels in our Expansion Fleet prior to the completion of this offering, as more fully described under "Certain Relationships and Related Party Transactions IPO Formation Transactions." Except where we or the context otherwise indicate, the information in this prospectus gives effect to the completion of such transactions. Our Initial Fleet Our Initial Fleet consists of 10 product tankers comprised of eight MRs and two LR1s with an aggregate carrying capacity of 543,090 dwt, and a dwt-weighted average age of approximately 6.7 years as of June 30, 2014. Our vessels are flagged in the Republic of the Marshall Islands and Panama. The following table summarizes certain information about our Initial Fleet as of the date of this prospectus: Vessel Name Type Year Built Capacity (dwt) Shipyard Charterer Charter Type Gross Daily Charter Rate (U.S. dollars) Expiration of Charter (earliest) 1 Britto(1) MR 2009 49,999 SPP, Korea Daelim Bareboat $ 14,550 March 2019 2 Hongbo(1) MR 2009 50,106 SPP, Korea Daelim Bareboat $ 14,550 June 2019 3 Lichtenstein(1) MR 2009 50,070 SPP, Korea Daelim Bareboat $ 14,550 December 2018 4 MR Pat Brown(2) MR 2009 50,096 SPP, Korea Stena Weco Time Charter $ 14,950 December 2014 5 MR Canopus MR 2007 50,564 SPP, Korea ADNOC Time Charter $ 15,350 February 2015 6 MR Kentaurus(3) MR 2007 46,763 Sungdong, Korea Trafigura Time Charter $ 13,250 October 2014 7 MR Sirius(3) MR 2007 46,846 Sungdong, Korea Trafigura Time Charter $ 14,250 December 2014 8 MR Arcturus(4) MR 2006 50,546 SPP, Korea Shell Time Charter $ 14,625 November 2015 9 FR8 Venture LR1 2006 74,065 New Century, China Sonagol Time Charter $ 21,000 December 2014 10 LR Mimosa(5) LR1 2006 74,035 New Century, China Panamax International Inc. Time Charter $ 14,500 January 2016 Total Vessels Table of Contents shares of common stock, respectively. Please see "Principal and Selling Shareholders" for a more detailed description of our share ownership following this offering. AMCI Poseidon Fund is an investment fund focused on investment opportunities in the shipping industry. The principals of and investors in the fund include our Chairman and Chief Executive Officer, Stamatis Molaris, and various persons affiliated with AMCI, including its co-founder Hans J. Mende. Mr. Molaris has over 20 years of experience in the shipping industry, including as a senior executive with three publicly traded shipping companies and is the founder of our Manager, Empire Navigation. AMCI is a privately owned natural resource company with strategic investments in coal and minerals, mining and shipping. Mr. Molaris has advised the Company that, effective upon the closing of this offering, he intends to withdraw from the general partner of AMCI Poseidon Fund and forego any economic interest in AMCI Poseidon Fund attributable to product tankers. Maas Capital is a private equity affiliate of ABN AMRO N.V., a leading lender to the shipping industry. Maas Capital has provided equity and mezzanine financing to the shipping industry since 2000. Our Corporate Structure Product Shipping Limited was incorporated under the laws of the Republic of the Marshall Islands on May 27, 2014. We commenced business operations through our predecessor company, HSM Products Limited, on September 10, 2012, when HSM Products Limited acquired six of the vessels in our Initial Fleet on October 10, 2012, and expanded our business operations on October 16, 2013, when Poseidon Product Tankers acquired the remaining four vessels in our Initial Fleet. We will conduct our operations through various wholly-owned subsidiaries. Each of our product tankers will be owned by one of our subsidiaries. On July 10, 2014, AMCI Poseidon Fund incorporated the holding company MR Holding in order to acquire three additional MR product tankers. On the same date, MR Holding acquired the shares of three vessel-owning companies, namely MR Aquarius Limited, MR Leo Limited and MR Aries Limited that have agreed to acquire the vessels Marlin Glory, Marlin Iris and Marlin Topaz, respectively, and their attached time charters to Trafigura. Subsequent to July 10, 2014, AMCI Poseidon Fund contributed $7.4 million to MR Holding, which has been used for vessel and time charter deposits. Prior to the IPO Formation Transactions, the Fund will sell 50.0% of MR Holding to THK Private Equities, LLC for $3.7 million. Such memoranda of agreement and cash deposits are the only signficant assets or operations of MR Holding, which is expected to take delivery of the three vessels comprising our Expansion Fleet prior to the completion of this offering. On July 10, 2014, an affiliate of Stamatis Molaris incorporated LR Holding in order to acquire the entity owning the LR1 product tanker Cape Talara. LR Holding is party to an agreement pursuant to which it has agreed that, upon the completion of this offering, it will pay $1.0 million to an unaffiliated third party for the option to purchase the 2010-built LR1 Cape Talara for a purchase price of $39.5 million (less the $1.0 million paid upon completion of this offering) exercisable on or prior to December 31, 2014. Concurrently with this offering, pursuant to an exchange agreement between us and our shareholders, in a series of transactions, we will acquire, in exchange for shares of our common stock, all of the outstanding shares of (i) the holding companies which own the vessel-owning subsidiaries of our Initial Fleet (AMCI Products Limited and HSM Products Limited, the latter through AMCI Poseidon Fund's contribution of all the shares of Poseidon Products Carriers Limited, an intermediate holding company that was an inactive subsidiary until it acquired 53.4% of the equity interests in HSM Products Limited on September 16, 2013, and Maas Capital's contribution of 46.6% of the equity interests in HSM Products Limited), and (ii) the holding company which owns the subsidiaries party to the memoranda of agreement to acquire the MR product tankers in our Expansion Fleet and related time charters to Trafigura and which subsidiaries are expected to take delivery of the three vessels comprising our Expansion Fleet prior to the completion of this offering (MR Holding). In addition, pursuant to the Exchange Agreement an Table of Contents which we also refer to as our Manager or Empire, and which provides commercial management for our fleet and technical management for all but one of our vessels, has a management and operational team, comprised of executive officers who have an average of 29 years of experience in the shipping industry. We believe that the experience and reputation of our management team will assist us in identifying, acquiring and operating suitable vessels for the expansion of our fleet. Our principal shareholders are AMCI Poseidon Fund, which focuses on investments in the shipping industry and whose principals include Mr. Molaris and Hans J. Mende, a founder of AMCI, and Maas Capital, the private equity affiliate of ABN AMRO Bank N.V., a leading lender to the shipping industry. We intend to use approximately $39.1 million of the net proceeds from this offering to fund a portion of the aggregate purchase price for the three MR product tankers we intend to acquire. In addition, we intend to use approximately $97.6 million of the net proceeds from this offering to repay part of the outstanding indebtedness under our existing credit facilities and have obtained commitment letters from Credit Suisse AG for four separate new credit facilities for the refinancing of the expected remaining outstanding balance under our existing credit facilities, and for the financing of the $27.5 million remaining cash portion of the aggregate purchase price for our Expansion Fleet. The commitment letters are subject to completion of satisfactory definitive documentation and other customary conditions. Our Initial Fleet Our Initial Fleet consists of 10 product tankers comprised of eight MRs and two LR1s with an aggregate carrying capacity of 543,090 dwt, and a dwt-weighted average age of approximately 6.7 years as of June 30, 2014. Our vessels are flagged in the Republic of the Marshall Islands and Panama. The following table summarizes certain information about our Initial Fleet as of the date of this prospectus: Vessel Name Type Year Built Capacity (dwt) Shipyard Charterer Charter Type Gross Daily Charter Rate (U.S. dollars) Expiration of Charter (earliest) 1 Britto(1) MR 2009 49,999 SPP, Korea Daelim Bareboat $ 14,550 March 2019 2 Hongbo(1) MR 2009 50,106 SPP, Korea Daelim Bareboat $ 14,550 June 2019 3 Lichtenstein(1) MR 2009 50,070 SPP, Korea Daelim Bareboat $ 14,550 December 2018 4 MR Pat Brown(2) MR 2009 50,096 SPP, Korea Stena Weco Time Charter $ 14,950 December 2014 5 MR Canopus MR 2007 50,564 SPP, Korea ADNOC Time Charter $ 15,350 February 2015 6 MR Kentaurus(3) MR 2007 46,763 Sungdong, Korea Trafigura Time Charter $ 13,250 October 2014 7 MR Sirius(3) MR 2007 46,846 Sungdong, Korea Trafigura Time Charter $ 14,250 December 2014 8 MR Arcturus(4) MR 2006 50,546 SPP, Korea Shell Time Charter $ 14,625 November 2015 9 FR8 Venture LR1 2006 74,065 New Century, China Sonagol Time Charter $ 21,000 December 2014 10 LR Mimosa(5) LR1 2006 74,035 New Century, China Panamax International Inc. Time Charter $ 14,500 January 2016 Total Vessels We are an "emerging growth company" as that term is used in the Securities Act of 1933, as amended, and, as such, we may elect to comply with certain reduced public company reporting requirements. See "Prospectus Summary Implications of Being an Emerging Growth Company." Investing in our common stock involves risks. See "Risk Factors" beginning on page 19. Table of Contents entity affiliated with Stamatis Molaris will transfer to us for no consideration the company party to the purchase option to acquire the entity owning the Cape Talara and related bareboat charter (LR Holding). The exchange agreement also contemplates that, prior to these transactions, the equity interests in the vessel-owning subsidiary of AMCI Products Limited owning the UACC Shams, and associated outstanding debt and interest rate swaps, will be transferred to a subsidiary of AMCI Poseidon Fund that is not being contributed to us. As described elsewhere in this prospectus, our chairman and CEO has interests in the exchange agreement and the transactions contemplated thereby, or the IPO Formation Transactions. Please see "Certain Relationships and Related Party Transactions IPO Formation Transactions." We maintain our principal executive offices at 88 Vouliagmenis Avenue, Elliniko, 16777, Greece. Our telephone number at that address is +30-211-102-4000. After completion of this offering, we will maintain a website at www. .com. The following chart sets forth a simplified presentation of our corporate structure to be in effect upon completion of the IPO Formation Transactions, the closing of this offering (assuming no exercise of the underwriters' over-allotment option) and the acquisition of our Expansion Fleet and LR Holding: PRICE $ A SHARE Table of Contents Conflicts of Interest Our Chairman and Chief Executive Officer, Stamatis Molaris, is one of the two owners of our Manager and will continue to directly or indirectly control our Manager after the offering. This relationship, and other relationships between certain of our executive officers and members of our Manager, may create certain conflicts of interest between us and our Manager. These conflicts may arise in connection with the chartering, purchase, sale and operations of the vessels in our fleet versus vessels managed by other companies affiliated with our Manager and Mr. Molaris. While we believe that the expected terms of the Management Agreement are consistent with normal commercial practice of the industry, the agreement was not negotiated on an arms-length basis by non-related parties and, accordingly, the terms may be less favorable to the Company than if such terms were obtained by a non-related party. The Management Agreement does not require that any conflicts of interest be resolved in favor of the Company. Our Chairman and Chief Executive Officer and our Chief Financial Officer also have affiliations with other shipping industry participants, which may create conflicts of interest. Mr. Molaris is also the Chairman and Chief Executive Officer of Alma Maritime and a principal of AMCI Poseidon Fund, which is one of our principal shareholders. Our Chief Financial Officer, Stewart Crawford, is also the Chief Financial Officer of Alma Maritime. Alma Maritime's fleet includes one product tanker in addition to crude oil tankers and dry bulk carriers and AMCI Poseidon Fund and Maas Capital, our principal shareholders, each control one product tanker managed by Empire, and AMCI Poseidon Fund has contracted to acquire one additional product tanker. Mr. Molaris has advised the Company that, within three months following the closing of this offering, he intends to resign his position as Chief Executive Officer of Alma Maritime and remain as its non-executive Chairman, and, effective upon the closing of this offering, to resign from the general partner of the AMCI Poseidon Fund and forego any economic interest in AMCI Poseidon Fund attributable to product tankers. Mr. Crawford has advised the Company that, within three months following the closing of this offering, he intends to resign his position as Chief Financial Officer of Alma Maritime. These conflicts of interest may have an adverse effect on our results of operations. See "Certain Relationships and Related Party Transactions." Implications of Being an Emerging Growth Company We had less than $1.0 billion in combined revenue during our last fiscal year, which means that we qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include: the ability to present only two years of audited financial statements and only two years of related Management's Discussion and Analysis of Financial Condition and Results of Operations in the registration statement for our initial public offering; exemption from the auditor attestation requirement in the assessment of the emerging growth company's internal controls over financial reporting, for so long as a company qualifies as an "emerging growth company"; exemption from new or revised financial accounting standards applicable to public companies until such standards are also applicable to private companies; and exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to our auditor's report in which the auditor would be required to provide additional information about the audit and our financial statements. We may take advantage of these provisions and other applicable provisions until the end of the fiscal year following the fifth anniversary of our initial public offering or such earlier time that we are no longer an emerging growth company. We will cease to be an emerging growth company if, among other things, we Price to Public Underwriting Discounts and Commissions(1) Proceeds to Company Per share $ $ $ Total $ $ $ Table of Contents have more than $1.0 billion in "total annual gross revenues" during the most recently completed fiscal year, we become a "large accelerated filer" with market capitalization of more than $700 million, or as of any date on which we have issued more than $1.0 billion in non-convertible debt over the three-year period to such date. We may choose to take advantage of some, but not all, of these provisions. For as long as we take advantage of the reduced reporting obligations, the information that we provide to our shareholders may be different from information provided by other public companies. We are choosing to "opt out" of the extended transition period relating to the exemption from new or revised financial accounting standards and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. Risk Factors We face a number of risks associated with our business and industry and must overcome a variety of challenges to utilize our strengths and implement our business strategy. These risks include, among others, the highly cyclical petroleum product tanker industry; fluctuating charter rates and vessel values; changing economic, political and governmental conditions affecting our industry and business; material changes in applicable laws and regulations; potential failure by counterparties to perform; risks associated with acquisitions and dispositions; operating expense levels; capital expenditure levels; taxes; maintaining customer relationships; maintaining sufficient liquidity; financing availability and compliance with the terms of our financing arrangements. This is not a comprehensive list of risks to which we are subject, and you should carefully consider all the information in this prospectus prior to investing in our shares of common stock. In particular, we urge you to carefully consider the risk factors set forth in the section of this prospectus entitled "Risk Factors" beginning on page 19. (1)We have agreed to reimburse the underwriters for certain expenses related to the review by the Financial Industry Regulatory Authority, Inc. of the terms of sale of the common stock offered hereby. See "Underwriters." AMCI Poseidon Fund, LP, the selling shareholder identified in this prospectus, has granted the underwriters an option to purchase up to shares to cover over-allotments at the initial public offering price less the underwriting discount. We will not receive any of the proceeds from the sale of any shares sold by the selling shareholder. The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares to purchasers on or around , 2014. (1)Excludes shares of our common stock reserved for issuance under the equity incentive plan we intend to adopt prior to this offering. Morgan Stanley , 2014 Table of Contents SUMMARY HISTORICAL AND PRO FORMA FINANCIAL AND OTHER DATA The following table summarizes certain summary historical and other data of HSM Products Limited and Poseidon Product Tankers. Product Shipping Limited was incorporated under the laws of the Republic of the Marshall Islands on May 27, 2014. We have derived the historical consolidated financial data for our Predecessor, HSM Products Limited, as of December 31, 2013 and 2012, for the year ended December 31, 2013 and for the period from September 10, 2012 (date of inception) to December 31, 2012 from the audited consolidated financial statements, which are included elsewhere in this prospectus. We have derived the historical combined financial data of Poseidon Product Tankers as of December 31, 2013 and for the period from September 4, 2013 to December 31, 2013 from the audited combined financial statements, which are included elsewhere in this prospectus. We have derived the historical consolidated financial data as of June 30, 2014 and for the six-month periods ended June 30, 2014 and 2013 for HSM Products Limited from the unaudited consolidated financial statements which are included elsewhere in this prospectus, and the historical combined financial data as of June 30, 2014 and for the six-month period ended June 30, 2014 for Poseidon Product Tankers from the unaudited combined financial statements, which are included elsewhere in this prospectus. The consolidated and combined financial statements of HSM Products Limited and Poseidon Product Tankers, respectively, included in this prospectus have been prepared in accordance with U.S. GAAP and are presented in U.S. dollars. The data set forth below should be read in conjunction with the consolidated and combined financial statements, related notes and other financial information included elsewhere in this prospectus. The following tables also summarize unaudited pro forma combined financial statements of Product Shipping Limited. Such data has been derived by combining the historical financial statements of Poseidon Product Tankers, or Poseidon, and HSM Products Limited, or HSM (in each case, which are included elsewhere in this prospectus), and applying pro forma adjustments to the combined historical financial data. The following unaudited pro forma combined financial data gives effect to the following transactions, as if they occurred on January 1, 2013 for the pro forma statement of operations for the year ended December 31, 2013 and six-month period ended June 30, 2014 and as if they occurred on June 30, 2014 for the pro forma balance sheet as of June 30, 2014: Acquisition of Poseidon by Product Shipping Limited, or the Poseidon Dropdown The acquisition of Poseidon by Product Shipping Limited in exchange for newly-issued shares of Product Shipping Limited with an aggregate fair value of $ million based upon an assumed initial public offering price of $ per share (the mid-point of the estimated price range on the cover of this prospectus); The elimination of income statement and balance sheet balances that relate to a vessel (UACC Shams) that historically constituted a part of Poseidon but which will be divested as part of the IPO Formation Transactions and not be part of the ongoing operations of Product Shipping Limited; Acquisition of HSM by Product Shipping Limited, or the HSM Dropdown The acquisition of HSM by Product Shipping Limited through AMCI Poseidon Fund's contribution of all the shares of Poseidon Products Carriers Limited, an intermediate holding company that was an inactive subsidiary until it acquired 53.4% of the equity interests in HSM Products Limited on September 16, 2013, and Maas Capital's contribution of 46.6% of the equity interests in HSM Products Limited, in exchange for newly-issued shares of Product Shipping Limited with an aggregate fair value of $ million, based upon an assumed initial public offering price of $ per share (the mid-point of the estimated price range on the cover of this prospectus); The elimination of the results of operations relating to a vessel (LR Regulus) that was sold by HSM during the year ended December 31, 2013; Table of Contents TABLE OF CONTENTS Table of Contents This Offering, Use of Proceeds and New Debt Facilities The issuance of newly-issued shares of Product Shipping Limited at $ per share, based upon an assumed initial public offering price of $ per share (which is the mid-point of the estimated price range set forth on the cover page of this prospectus), for aggregate cash consideration of $ million; The payment of offering-related expenses aggregating $ million; A $1.0 million payment to acquire an option to purchase the 2010-built LR1 Cape Talara from an unaffiliated third party; The application of $97.6 million of the net proceeds of this offering to the repayment of outstanding indebtedness under our existing credit facilities and bank fees of $1.8 million; and In connection with this offering, the Company and three of our vessel-owning subsidiaries expect to enter into four separate senior secured credit facilities with Credit Suisse AG, as described elsewhere in this prospectus, having an aggregate facility amount of up to $200.0 million, of which $27.5 million will be used to finance the remaining portion of the aggregate purchase price of each of the three vessels in the Company's Expansion Fleet and refinance the remaining outstanding balance of $91.1 million under our existing credit facilities after the application of the net proceeds of this offering. Acquisition of MR Holding On the offering date, Product Shipping Limited will acquire 100% of the equity of MR Holding, the entity that will hold the three vessels of our Expansion Fleet, for aggregate consideration of $ of which $39,125 thousand will be paid with offering proceeds, $27,475 thousand will be financed through the New Debt Facilities, and $ (based on the midpoint of the estimated price range on the cover of this prospectus) will be paid with Product Shipping Limited shares of common stock ( shares). The Poseidon Dropdown will be accounted for as a transaction between entities under common control. Product Shipping Limited was established by and is controlled by the AMCI Poseidon Fund, and AMCI Poseidon Fund also controls 100% of the other vessels included in the Poseidon Dropdown. As part of the IPO Formation Transactions, the Poseidon Dropdown will occur prior to the receipt of IPO proceeds from new investors and, as a result, AMCI Poseidon Fund will control the vessels included in the Poseidon Dropdown before and after the transaction, which results in common control accounting. Accordingly, the assets and liabilities of Poseidon will be recorded by Product Shipping Limited at their historical carrying amounts. The HSM Dropdown will be accounted for as a business combination using the acquisition method of accounting under the provisions of Accounting Standards Codification 805, "Business Combinations", or ASC 805. The purchase by the AMCI Poseidon Fund of a 53.4% shareholder interest in HSM did not result in the AMCI Poseidon Fund obtaining control of HSM as there is a shareholder agreement that requires key voting decisions to be approved by the holders of 67% of all the outstanding shares of HSM. The acquisition method of accounting uses the fair value concepts defined in Accounting Standards Codification 820, "Fair Value Measurement", or ASC 820. ASC 805 requires, among other things, that the tangible and intangible assets acquired and liabilities assumed in a business combination be recognized at their fair values as of the acquisition date, with any excess of the purchase price over the net identifiable net assets acquired recognized as goodwill. The unaudited pro forma combined financial statements have been derived from (i) the historical financial statements of Poseidon and HSM, in each case included elsewhere in this prospectus and (ii) applying to them pro forma adjustments based upon assumptions that we believe to be reasonable and which are described in the footnotes included hereto. Page PROSPECTUS SUMMARY 1
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+This summary highlights information contained elsewhere in this prospectus and does not contain all of the information you should consider before investing in shares of our Class A common stock. You should read this entire prospectus carefully, including the section entitled Risk Factors and the financial statements and the related notes thereto included elsewhere in this prospectus, before you decide to invest in shares of our Class A common stock. Medley Medley is a rapidly growing asset management firm with approximately $3.3 billion of AUM as of June 30, 2014. We provide institutional and retail investors with yield-oriented investment products that pay periodic dividends or distributions that we believe offer attractive risk-adjusted returns. We focus on credit-related investment strategies, primarily originating senior secured loans to private middle market companies in the United States that have revenues between $50 million and $1 billion. We generally hold these loans to maturity. We manage two permanent capital vehicles, both of which are BDCs, as well as long-dated private funds and SMAs. Our focus on senior secured credit, combined with the permanent and long-dated nature of our vehicles, leads to predictable management fee and incentive fee income. Our year over year AUM growth as of June 30, 2014 was 62% and our compounded annual growth rate of AUM from December 31, 2010 through December 31, 2013 was 31%, which have been driven in large part by the growth in our permanent capital vehicles. We believe our 31% compounded annual growth rate of AUM from December 31, 2010 through December 31, 2013 compares favorably with both our small and middle market asset manager peers, who had an average compounded annual growth rate of AUM of 18% for the same period, and the 26 component BDCs of the Wells Fargo Business Development Company Index, who had average total asset growth of 19% for the same period. As we have grown our AUM in permanent capital vehicles over time, we also have maintained a consistent presence in the institutional market, with AUM in long-dated private funds and SMAs growing from $1.0 billion as of January 1, 2012 to $1.5 billion as of June 30, 2014. Since the launch of our first permanent capital vehicle in January 2011, permanent capital has grown to represent 55% of our AUM as of June 30, 2014. For the six months ended June 30, 2014, 90% of our standalone revenues were generated from management fee income and performance fee income derived primarily from net interest income on senior secured loans. See Management s Discussion and Analysis of Financial Condition and Results of Operations Managing Business Performance. Direct origination, careful structuring and active monitoring of the loan portfolios we manage are important success factors in our business, which can be adversely affected by difficult market and political conditions, such as the turmoil in the global capital markets from 2007 to 2009. Since our inception in 2006, we have adhered to a disciplined investment process that employs these principles with the goal of delivering strong risk-adjusted investment returns while protecting investor capital. We believe that our ability to directly originate, structure and lead deals enables us to consistently lend at higher yields with better terms. In addition, the loans we manage generally have a contractual maturity of between three and seven years and are typically floating rate, which we believe positions our business well for rising interest rates. Although we have a relatively short operating history, our senior management team has on average over 20 years of experience in credit, including originating, underwriting, principal investing and loan structuring. We have made significant investments in our corporate infrastructure and have over 70 employees, including over 35 investment, origination and credit management professionals, and over 35 operations, marketing and distribution professionals, each with extensive experience in their respective disciplines. We emphasize a culture of trust, respect, integrity, collaboration and performance. We believe that an important part of our growth has been a result of our ability to attract high caliber professionals and the emphasis we place on training and developing our team. In addition, we TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to completion, dated September 15, 2014 Preliminary Prospectus 6,000,000 Shares Medley Management Inc. Class A Common Stock This is the initial public offering of shares of Class A common stock of Medley Management Inc. No public market currently exists for our Class A common stock. We are offering all of the 6,000,000 shares that are being offered in this offering. We anticipate that the initial public offering price will be between $20.00 and $22.00 per share. The shares of Class A common stock have been authorized for listing on the New York Stock Exchange under the symbol MDLY. Upon completion of this offering, Medley Group LLC, an entity owned by certain of our senior professionals, will hold shares of Class B common stock that will entitle it to 97.5% (or 97.1% if the underwriters option to purchase additional shares of Class A common stock is exercised in full) of the voting power of our common stock eligible to vote in the election of our directors. As a result, we will be a controlled company. See Organizational Structure Organizational Structure Following this Offering and Management Controlled Company Exception. Although neither such senior professionals nor Medley Group LLC will own any shares of Class A common stock after the completion of this offering, such senior professionals will own units in Medley LLC exchangeable on a one-for-one basis for up to 23,333,333 shares of our Class A common stock, subject to certain conditions, as described under Organizational Structure, Certain Relationships and Related Party Transactions Exchange Agreement and Medley LLC Limited Liability Company Agreement. We are an emerging growth company as defined under the federal securities laws and, as such, may elect to comply with certain reduced public company reporting requirements for future filings. See Summary Implications of Being an Emerging Growth Company. Investing in shares of our Class A common stock involves risks. See Risk Factors beginning on page 18 to read about factors you should consider before buying shares of our Class A common stock. Per Share Total Initial public offering price $ $ Underwriting discount 1 $ $ Proceeds, before expenses, to Medley Management Inc. $ $ (1) See Underwriting for a description of compensation payable to the underwriters. To the extent that the underwriters sell more than 6,000,000 shares of our Class A common stock, the underwriters have the option to purchase up to an additional 900,000 shares of our Class A common stock from us at the initial public offering price less the underwriting discount, within 30 days from the date of this prospectus. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares of our Class A common stock against payment in New York, New York on or about , 2014. Joint Book-Running Managers Goldman, Sachs & Co. Credit Suisse Barclays Deutsche Bank Keefe, Bruyette & Woods A Stifel Company Co-Managers RCS Capital JMP Securities Ladenburg Thalmann MLV & Co. Gilford Securities Incorporated The date of this prospectus is , 2014. TABLE OF CONTENTS When used in this prospectus, unless the context otherwise requires: assets under management or AUM refers to the assets of our funds, which represents the sum of the net asset value of such funds, the drawn and undrawn debt (at the fund level, including amounts subject to restrictions) and uncalled committed capital (including commitments to funds that have yet to commence their investment periods); base management fees refers to fees we earn for advisory services provided to our funds, which are generally based on a defined percentage of assets under management or in certain cases a percentage of originated assets in the case of certain of our SMAs; BDC refers to business development company; Consolidated Funds means (a) with respect to the six months ended June 30, 2014 and 2013, and the year ended December 31, 2013, Medley Opportunity Fund LP ( MOF I ) and Medley Opportunity Fund II LP ( MOF II ) and (b) with respect to the year ended December 31, 2012, MOF I, MOF II and SIC. See Management s Discussion and Analysis of Financial Condition and Results of Operations Consolidation and Deconsolidation of Medley Funds; fee earning AUM refers to the AUM on which we directly earn base management fees; investee company refers to a company to which one of our funds lends money or in which one of our funds otherwise makes an investment; long-dated private funds refers to MOF I, MOF II and any other private funds we may manage in the future; management fees refers to base management fees and Part I incentive fees; our funds refers to the funds, alternative asset companies and other entities and accounts that are managed or co-managed by us and our affiliates; our investors refers to the investors in our permanent capital vehicles, our private funds and our SMAs; Part I incentive fees refers to fees that we receive from our permanent capital vehicles, which are paid in cash quarterly and are driven primarily by net interest income on senior secured loans subject to hurdle rates. These fees are not subject to clawbacks or netting against realized losses; Part II incentive fees refers to fees related to realized capital gains in our permanent capital vehicles; performance fees refers to incentive allocations in our long-dated private funds and incentive fees from our SMAs, which are generally equal to 20% of total return after a hurdle rate, accrued quarterly, but paid after the return of all invested capital and in an amount sufficient to achieve the hurdle rate; permanent capital refers to capital of funds that do not have redemption provisions or a requirement to return capital to investors upon exiting the investments made with such capital, except as required by applicable law, which funds currently consist of Medley Capital Corporation (NYSE: MCC) ( MCC ) and Sierra Income Corporation ( SIC ). Such funds may be required, or elect, to return all or a portion of capital gains and investment income. In certain circumstances, the investment adviser of such a fund may be removed. See Risk Factors; and SMA refers to a separately managed account. TABLE OF CONTENTS believe our approach to compensation, which focuses on long-term investment performance, supports a strong credit culture and aligns the interests of employees, investors and shareholders. We have made significant investments in our loan origination and underwriting platform and believe it is scalable and can support our future growth within the competitive investment management business. These capabilities, combined with our active approach to credit management, have helped us generate attractive risk-adjusted returns for our investors. Direct Origination. We focus on lending directly to companies that are underserved by the traditional banking system and we generally seek to avoid broadly marketed investment opportunities. We source investment opportunities through direct relationships with companies, financial intermediaries such as national, regional and local bankers, accountants, lawyers and consultants, as well as through financial sponsors. As a leading provider of private debt, we are often sought out as a preferred financing partner. Historically, the majority of our annual origination volume has been derived from direct loan origination. In 2013, we sourced 1,030 investments, which resulted in 66 investments and approximately $842 million of invested capital. Disciplined Underwriting. We perform thorough due diligence and focus on several key criteria in our underwriting process, including strong underlying business fundamentals, a meaningful equity cushion, experienced management, conservative valuation and the ability to deleverage through cash flows. We are often the agent for the loans we originate and accordingly control the loan documentation and negotiation of covenants, which allows us to maintain consistent underwriting standards. Our disciplined underwriting process also involves engagement of industry experts and third party consultants. This disciplined underwriting process is essential as our funds have historically invested in privately held companies, for which public financial information is generally unavailable. Since our inception, we have invested in 242 borrowers, and experienced realized partial losses in 12 of these investments through June 30, 2014. We believe our disciplined underwriting culture is a key factor to our success and our ability to expand our product offerings. Active Credit Management. We employ active credit management. Our process includes frequent interaction with management, monthly or quarterly review of financial information and attendance at board of directors meetings as observers. Investment professionals with deep restructuring and workout experience support our credit management effort. Our Business Investment Products We provide our credit-focused investment strategies through various funds and products that meet the needs of a wide range of retail and institutional investors. TABLE OF CONTENTS We launched MCC (NYSE: MCC), our first permanent capital vehicle, in 2011 as a BDC. MCC has grown to become a leading BDC with more than $1.1 billion in assets. As of June 30, 2014, MCC has demonstrated a compound annual growth rate of AUM since inception of 73%, and has generated a 12.7% annualized total shareholder return since its 2011 initial public offering, outperforming publicly listed BDC peers and the Credit Suisse Leveraged Loan index by approximately 370 and 730 basis points, respectively, over the same period. We launched SIC, our first public non-traded permanent capital vehicle, in 2012 as a BDC. SIC is now offered on a continuous basis to investors through over 110 broker dealers representing over 27,800 registered investment advisers ( RIAs ). Since inception, SIC has demonstrated rapid growth. During the quarter ended June 30, 2014, SIC increased AUM by $92.6 million, a 28% increase over the quarter ended March 31, 2014. As of June 30, 2014, SIC has generated a 9.4% annualized total return for shareholders since launching in April 2012. We also have a strong institutional investor base, having managed assets for sophisticated institutions since our inception. We have raised cumulative commitments of over $2.3 billion in long-dated private funds and SMAs through June 30, 2014. Our Sources of Revenue We believe that our revenue is consistent and predictable due to our investment strategy and the structure of our fees. The significant majority of our standalone revenue is derived from management fees, which includes both base management fees earned on all of our investment products as well as Part I incentive fees earned from our permanent capital vehicles. Our base management fees are generally calculated based upon fee earning assets and paid quarterly in cash. Our Part I incentive fees are generally equal to 20% of net interest income, subject to a hurdle rate, and are also calculated and paid quarterly in cash. We also earn performance fees from our long-dated private funds and SMAs. Typically, these performance fees are equal to 20% of total return above a hurdle rate. These performance fees are accrued quarterly and paid after return of all invested capital and an amount sufficient to achieve the hurdle rate of return. The investment strategies in our permanent capital vehicles, long-dated private funds and SMAs are primarily focused on generating net interest income from senior secured loans. Because we focus on capital preservation and generally originate senior secured loans that accrue interest at a rate in excess of our hurdle rate, we believe our Part I incentive fees and performance fees are predictable and recurring. We also receive incentive fees related to realized capital gains in our permanent capital vehicles, which we refer to as Part II incentive fees. These incentive fees are typically equal to 20% of the net realized gain after achieving a hurdle rate, and are paid annually. As our investment strategy is focused on generating yield from senior secured credit, as opposed to capital gains, historically we have not generated Part II incentive fees. As a result, we do not disclose Part II incentive fees as a separate line item in our financial statements. The following table sets forth certain standalone financial information for the periods presented. Due to the GAAP requirement that certain funds be consolidated into Medley s financial statements, we have presented certain standalone financial data below, which deconsolidates such funds in order to present operating results that we believe are most reflective of our performance. Please see Management s Discussion and Analysis of Financial Condition and Results of Operations Managing Business Performance Standalone Financial Information. TABLE OF CONTENTS Six Months Ended June 30, Year Ended December 31, 2014 2013 2013 2012 (Dollars in thousands, except as indicated) Consolidated Financial Data: Net income attributable to members $ 15,969 $ 6,045 $ 23,637 $ 11,918 Standalone Financial Data: Core EBITDA $ 21,459 $ 9,340 $ 30,798 $ 14,872 Core Net Income 19,461 8,203 28,329 13,384 Other Data (at period end, in millions): AUM $ 3,318 $ 2,046 $ 2,283 $ 1,765 Fee Earning AUM 2,451 1,755 2,006 1,509 Industry Trends We are well positioned to capitalize on the following trends in the asset management industry: De-Leveraging of the Global Banking System. After an extended period of increasing leverage, commercial and investment banks have been de-leveraging since 2008. Bank consolidation, more prudent balance sheet discipline, changing regulatory capital requirements and the increasing cost and complexity of regulatory compliance have led banks to meaningfully withdraw from markets such as non-investment grade middle market and commercial real estate lending. This has created a significant opportunity for non-bank direct lenders like Medley. Increasing Demand for Yield-Oriented Investments by Retail Investors. A key demographic trend driving demand for yield is the aging population in the United States. Retirees generally have shorter investment horizons, with a sharper focus on stable, income-generating portfolios. This dynamic, amplified by the shortage of yield-oriented opportunities in the current low interest rate environment, has resulted in strong demand for yield-oriented investments by an aging population. Through our permanent capital vehicles, MCC and SIC, we believe we are well-positioned to capitalize on this growing retail investor demand. Shifting Asset Allocation Policies of Institutional Investors. The low interest environment is leading institutional investors to increasingly rotate away from core fixed income products, such as liquid debt securities, toward less liquid credit and absolute return-oriented products. Casey Quirk, an industry research firm, estimates that from 2013 to 2017, U.S. fixed income investors will reallocate $1 trillion of assets from traditional fixed income strategies to next generation fixed income products. In addition, we believe that the pension liability gap in the United States will continue to drive defined benefit pension plans toward more stable and higher return investment strategies. Similar to pension funds, insurance companies are increasingly turning to credit investments to offset their longer-term liabilities. Unfunded Private Equity Commitments Drive Demand for Debt Capital. According to Preqin, an industry research firm, the total amount of committed and uninvested private equity capital at June 30, 2014 is approximately $1.2 trillion, which we believe will drive significant demand for private debt financing in the coming years. Lending to private companies acquired by financial sponsors requires lenders to move quickly, perform in-depth due diligence and have significant credit and structuring experience. In order to successfully serve this market, lenders need to commit to hold all, or the significant majority of, the debt needed to finance such transactions. We believe that banks, due to the regulatory environment, will continue to reduce their exposure to middle market private loans. We believe this creates a significant supply/demand imbalance for middle market credit, and we are well positioned to bridge the gap. Competitive Strengths We have enjoyed rapid growth in our business. Since the launch of our first permanent capital vehicle in January 2011, permanent capital has grown to represent 55% of our AUM as of June 30, 2014. For the six months ended June 30, 2014, 90% of our standalone revenues were generated TABLE OF CONTENTS from management fee income and performance fee income derived primarily from net interest income on senior secured loans. We believe that the following attributes have contributed to our rapid growth and position Medley to capitalize on favorable industry trends going forward. Strong Investment Performance. Our investment products have achieved strong performance. For example, MCC s annualized total return since inception through June 30, 2014 of 12.7% compares favorably to 9.0% for publicly listed BDC peers and 5.4% for the Credit Suisse Leveraged Loan index, each for the same period. We believe the strong historical performance of our investment products will support our ongoing fundraising efforts and enable Medley to be a growing source of capital for the middle market. Stable Capital Base. A significant portion of our AUM consists of permanent capital. As of June 30, 2014, approximately 55% of our AUM was in permanent capital vehicles, which generally do not have redemption provisions or a requirement to return capital to investors. Our stable capital base makes us a reliable financing source. Strong Cash Flow Generation. A significant majority of our standalone revenue is derived from management fees, which includes base management fees and Part I incentive fees, both of which are paid quarterly in cash. For the years ended December 31, 2013 and 2012, approximately 78% and 84%, respectively, of our total standalone revenue was comprised of management fees. This strong and predictable cash flow enables us to continue to invest in our business, seed new products and provide our shareholders with an attractive dividend. See Business Fee Structure. Direct Origination, Disciplined Underwriting and Active Credit Management. We believe that the combination of our direct origination platform, disciplined underwriting and active credit management is an important competitive advantage and helps us preserve capital and generate attractive risk-adjusted returns for our investors. Our ability to directly originate, structure and lead deals enables us to be more opportunistic and less reliant on traditional sources of origination. It also enables us to control the loan documentation process, including negotiation of covenants, which provides consistent underwriting standards. In addition, we employ active credit management and interact frequently with our borrowers. Growing and Increasingly Diverse Investor Base. Our fundraising efforts are diversified across distribution channels and investment products. Our ability to raise capital across institutional channels, public markets, and non-traded RIA channels has enabled us to consistently increase AUM. We have dedicated in-house capital markets, investor relations and marketing professionals who are in frequent dialogue with investors. Our emphasis on transparency and communication has been an important part of the growth of our investor base. Experienced Team. Our senior management team has on average over 20 years of experience in credit, including origination, underwriting, principal investing and loan structuring. Our credit management and restructuring teams include over 25 professionals with extensive experience in their respective disciplines. We employ an integrated and collaborative investment process that leverages the skills and knowledge of our investment and credit management professionals. We believe that this is an important competitive advantage and has allowed us to deliver attractive risk-adjusted returns to our investors over time. To further align the interests of our team, in connection with this offering, we intend to grant to our employees restricted stock units under our equity incentive plan, which will vest over a multi-year period. Experience Managing Permanent Capital Vehicles. We have significant experience raising and managing permanent capital vehicles. In particular, we have demonstrated an ability to grow our permanent capital vehicles in an accretive manner for investors, and to prudently manage our liabilities. As of June 30, 2014, MCC has issued an aggregate of $451.1 million of new common equity net of offering costs as well as $721.0 million aggregate principal amount of debt financing. In addition, MCC has entered into an at the market distribution program and expects to offer up to $100 million of additional common equity from time to time. Similarly, as of June 30, 2014, SIC has issued approximately $310.7 million of new common equity net of offering costs as well as TABLE OF CONTENTS $295.0 million aggregate principal amount of debt financing. SIC has raised, on average, $26.6 million of net capital per month during the six months ended June 30, 2014. Consistent access to the capital markets has allowed MCC and SIC to achieve compounded annual AUM growth rates since inception of 73% and 452%, respectively. Furthermore, we have created a robust infrastructure to manage our permanent capital vehicles, including financial reporting, independent third party quarterly valuations, investor relations, accounting and legal functions. Our Growth Strategy We believe that Medley's strong growth is attributable to our investment philosophy and results, our emphasis on client communication and service, and our ability to attract, develop and retain high caliber professionals. We are pursuing an initial public offering because we believe that it will accelerate our growth by enhancing our brand, provide capital to grow our investment strategies and increase our strategic flexibility. As we continue to expand the business, we intend to: Organically Grow our Core Business. We expect to grow AUM in our existing permanent capital vehicles, and may launch additional permanent capital vehicles or similar long-dated investment products in the future. We also intend to increase AUM in our long-dated funds and managed accounts both by expanding existing investor relationships and through attracting new investors. We have made significant investments in corporate infrastructure to support our growth. Expand our Credit-Focused Product Offerings. We intend to grow our investment platform to include additional investment products that are complementary to our core credit offerings. As we expand our product offerings, we expect to leverage our existing retail and institutional investor base, and to attract new investors. Finally, we expect to leverage our direct origination platform, underwriting process and active credit management capabilities to grow related investment product offerings. Pursue Additional Strategic Relationships. We have established valuable relationships with industry participants and large institutional investors who, among other things, provide market insights, product advice and access to other key relationships. We also have important relationships with large fund investors, leading commercial and investment banks, global professional services firms, key distribution agents and other market participants that we believe are of significant value. As we expand our product offerings and market presence, we intend to pursue opportunities through additional strategic relationships. Investment Risks An investment in shares of our Class A common stock involves substantial risks and uncertainties that may adversely affect our business, financial condition and results of operations and cash flows. Some of the more significant challenges and risks relating to an investment in our company include, among other things, the following: Difficult market and political conditions may adversely affect our business in many ways, including by reducing the value or hampering the performance of the investments made by our funds, each of which could materially and adversely affect our business, results of operations and financial condition. We may not be able to maintain our current fee structure as a result of industry pressure from fund investors to reduce fees, which could have an adverse effect on our profit margins and results of operations. If we are unable to consummate or successfully integrate development opportunities, acquisitions or joint ventures, we may not be able to implement our growth strategy successfully. An investment strategy focused primarily on privately held companies presents certain challenges, including the lack of available information about these companies. The investment management business is competitive. TABLE OF CONTENTS Potential conflicts of interest may arise between our Class A common stockholders and our investors. Extensive regulation affects our activities, increases the cost of doing business and creates the potential for significant liabilities and penalties that could adversely affect our businesses and results of operations. Please see Risk Factors for a discussion of these and other factors you should consider before making an investment in shares of our Class A common stock. Implications of Being an Emerging Growth Company As a company with less than $1.0 billion in revenue during our most recently completed fiscal year as of the initial filing date of the registration statement of which this prospectus forms a part, we qualify as an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies that are not emerging growth companies. These provisions include: Presentation of only two years of audited financial statements and only two years of related management s discussion and analysis of financial condition and results of operations; Reduced disclosure about our executive compensation arrangements; No non-binding stockholder advisory votes on executive compensation or golden parachute arrangements; and Exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting. We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We will cease to be an emerging growth company upon the earliest of: (1) the end of the fiscal year following the fifth anniversary of this offering; (2) the first fiscal year after our annual gross revenues are $1.0 billion or more; (3) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or (4) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year. We have taken advantage of reduced disclosure regarding executive compensation arrangements in this prospectus, and we may choose to take advantage of some but not all of these reduced disclosure obligations in future filings. If we do, the information that we provide stockholders may be different than you might get from other public companies in which you hold stock. The JOBS Act permits an emerging growth company such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We are choosing to opt out of this provision and, as a result, we will comply with new or revised accounting standards as required when they are adopted. This decision to opt out of the extended transition period under the JOBS Act is irrevocable. Our Structure Following this offering, Medley Management Inc. will be a holding company and its sole asset will be a controlling equity interest in Medley LLC. Medley Management Inc. will operate and control all of the business and affairs and consolidate the financial results of Medley LLC and its subsidiaries. Prior to the completion of this offering, the limited liability company agreement of Medley LLC will be amended and restated to, among other things, modify its capital structure by reclassifying the interests currently held by our pre-IPO owners into a single new class of units that we refer to as LLC Units. We and our pre-IPO owners will also enter into an exchange agreement under which they (or certain permitted transferees) will have the right, from and after the first anniversary of the date of the completion of this offering (subject to the terms of the exchange agreement), to exchange TABLE OF CONTENTS their LLC Units for shares of our Class A common stock on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications. See Certain Relationships and Related Person Transactions Exchange Agreement. Medley Group LLC, an entity wholly-owned by our pre-IPO owners, holds all 100 issued and outstanding shares of our Class B common stock. For so long as our pre-IPO owners and then-current Medley personnel hold at least 10% of the aggregate number of shares of Class A common stock and LLC Units (excluding those LLC Units held by Medley Management Inc.) then outstanding, which we refer to as the Substantial Ownership Requirement, the Class B common stock will entitle Medley Group LLC, without regard to the number of shares of Class B common stock held by it, to a number of votes that is equal to 10 times the aggregate number of LLC Units held by all non-managing members of Medley LLC that do not themselves hold shares of Class B common stock and entitle each other holder of Class B common stock, without regard to the number of shares of Class B common stock held by such other holder, to a number of votes that is equal to 10 times the number of LLC Units held by such holder. For purposes of calculating the Substantial Ownership Requirement, (1) shares of Class A common stock deliverable to our pre-IPO owners and then-current Medley personnel pursuant to outstanding equity awards will be deemed then outstanding and (2) shares of Class A common stock and LLC Units held by any estate, trust, partnership or limited liability company or other similar entity of which any pre-IPO owner or then-current Medley personnel, or any immediate family member thereof, is a trustee, partner, member or similar party will be considered held by such pre-IPO owner or other then-current Medley personnel. From and after the time that the Substantial Ownership Requirement is no longer satisfied, the Class B common stock will entitle Medley Group LLC, without regard to the number of shares of Class B common stock held by it, to a number of votes that is equal to the aggregate number of LLC Units held by all non-managing members of Medley LLC that do not themselves hold shares of Class B common stock and entitle each other holder of Class B common stock, without regard to the number of shares of Class B common stock held by such other holder, to a number of votes that is equal to the number of LLC Units held by such holder. At the completion of this offering, our pre-IPO owners will comprise all of the non-managing members of Medley LLC. However, Medley LLC may in the future admit additional non-managing members that would not constitute pre-IPO owners. If at any time the ratio at which LLC Units are exchangeable for shares of our Class A common stock changes from one-for-one as described under Certain Relationships and Related Person Transactions Exchange Agreement, the number of votes to which Class B common stockholders are entitled will be adjusted accordingly. Holders of shares of our Class B common stock will vote together with holders of our Class A common stock as a single class on all matters on which stockholders are entitled to vote generally, except as otherwise required by law. Other than Medley Management Inc., holders of LLC Units, including our pre-IPO owners, will, subject to limited exceptions, be prohibited from transferring any LLC Units held by them upon consummation of this offering, or any shares of Class A common stock received upon exchange of such LLC Units, until the third anniversary of this offering without our consent. Thereafter and prior to the fourth and fifth anniversaries of this offering, such holders may not transfer more than 33 1/3% and 66 2/3%, respectively, of the number of LLC Units held by them upon consummation of this offering, together with the number of any shares of Class A common stock received by them upon exchange therefor, without our consent. While this agreement could be amended or waived by us, our pre-IPO owners have advised us that they do not intend to seek any waivers of these restrictions. TABLE OF CONTENTS The diagram below depicts our organizational structure immediately following this offering. For additional detail, see Organizational Structure. (1) The Class B common stock will provide Medley Group LLC with a number of votes that is equal to 10 times the aggregate number of LLC Units held by all non-managing members of Medley LLC. From and after the time that the Substantial Ownership Requirement is no longer satisfied, the Class B common stock will provide Medley Group LLC with a number of votes that is equal to the aggregate number of LLC Units held by all non-managing members of Medley LLC that do not themselves hold shares of Class B common stock. For additional information, see Organizational Structure Organizational Structure Following this Offering. (2) If our pre-IPO owners exchanged all of their LLC Units for shares of Class A common stock, they would hold 79.5% of the outstanding shares of Class A common stock, entitling them to an equivalent percentage of economic interests and voting power in Medley Management Inc., Medley Group LLC would hold no voting power or economic interests in Medley Management Inc. and Medley Management Inc. would hold 100% of outstanding LLC Units and 100% of the voting power in Medley LLC. (3) Certain individuals, entities and other partners engaged in our business will continue to own interests directly in selected operating subsidiaries, including, in certain instances, entities that receive management, performance and incentive fees from funds that we advise. For additional information concerning these interests, see Business Fee Structure. TABLE OF CONTENTS (4) Entities controlled by former employees hold limited liability company interests in MCC Advisors LLC that entitle them to approximately 4.86% of the net incentive fee income through October 29, 2015 and an additional 5.75% of the net incentive fee income through August 20, 2016 from MCC Advisors LLC. (5) SC Distributors, LLC owns 20% of SIC Advisors LLC and is entitled to receive distributions of up to 20% of the gross cash proceeds received by SIC Advisors LLC from the management and incentive fees payable by Sierra Income Corporation to SIC Advisors LLC, as well as 20% of the returns of the investments held at SIC Advisors LLC. (6) As of June 30, 2014, certain former employees and former members of Medley LLC hold approximately 41% of the limited liability company interests in MOF II GP LLC, the entity that serves as general partner of MOF II, entitling the holders to share the performance fees earned from MOF II. Medley Management Inc. was incorporated in Delaware on June 13, 2014. Our principal executive offices are located at 375 Park Avenue, 33rd Floor, New York, NY 10152 and our telephone number is (212) 759-0777. TABLE OF CONTENTS The Offering Class A common stock offered by Medley Management Inc. 6,000,000 shares. Option to purchase additional shares of our Class A common stock 900,000 shares. Class A common stock outstanding after giving effect to this offering 6,000,000 shares (or 29,333,333 shares if all outstanding LLC Units held by the non-managing members of Medley LLC were exchanged for newly-issued shares of Class A common stock on a one-for-one basis). Voting power held by holders of Class A common stock after giving effect to this offering 2.5% (or 100% if all outstanding LLC Units held by the non-managing members of Medley LLC were exchanged for newly-issued shares of Class A common stock on a one-for-one basis). Voting power held by Medley Group LLC as holder of all outstanding shares of Class B common stock after giving effect to this offering 97.5% (or 0% if all outstanding LLC Units held by the non-managing members of Medley LLC were exchanged for newly-issued shares of Class A common stock on a one-for-one basis). If all outstanding LLC Units held by the non-managing members of Medley LLC were exchanged for newly-issued shares of Class A common stock on a one-for-one basis and such shares continued to be held by such non-managing members, our pre-IPO owners would hold 79.5% of the outstanding shares of Class A common stock and an equivalent percentage of the voting power of our common stock eligible to vote in the election of our directors, and, as a result, we would still be a controlled company if such non-managing members formed a group. See Organizational Structure Organizational Structure Following this Offering and Management Controlled Company Exception. Use of proceeds We estimate that the net proceeds to Medley Management Inc. from this offering, after deducting estimated underwriting discounts, will be approximately $117.2 million (or $134.8 million if the underwriters exercise in full their option to purchase additional shares of Class A common stock). Medley LLC will bear or reimburse Medley Management Inc. for all of the expenses payable by it in this offering, which we estimate will be approximately $3.3 million. We intend to use all of the net proceeds from this offering (including from any exercise by the underwriters of their option to purchase additional shares of Class A common stock) to purchase a number of newly issued LLC Units from Medley LLC that is equivalent to the number of shares of Class A common stock that we offer and sell in TABLE OF CONTENTS this offering, as described under Organizational Structure Offering Transactions. We intend to cause Medley LLC to use these proceeds to repay indebtedness and for general corporate purposes. See Use of Proceeds. Voting rights Each share of our Class A common stock entitles its holder to one vote on all matters to be voted on by stockholders generally. Medley Group LLC, an entity wholly-owned by our pre-IPO owners, holds all of the outstanding shares of our Class B common stock. For so long as the Substantial Ownership Requirement is satisfied, it is anticipated that the Class B common stock will entitle Medley Group LLC to a number of votes that is equal to 10 times the aggregate number of LLC Units held by all non-managing members of Medley LLC. See Description of Capital Stock Common Stock Class B Common Stock. Holders of shares of our Class B common stock will vote together with holders of our Class A common stock as a single class on all matters on which stockholders are entitled to vote generally, except as otherwise required by law. Dividend policy Following this offering and subject to legally available funds, we intend to pay quarterly cash dividends to the holders of our Class A common stock initially equal to $0.20 per share of Class A common stock, commencing with a dividend payable in the first quarter of 2015 in respect of the fourth quarter of 2014. The declaration, amount and payment of any future dividends will be at the sole discretion of our board of directors. Our board of directors will take into account general economic and business conditions, our financial condition and operating results, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions and implications on the payment of dividends by us to our stockholders or by our subsidiaries (including Medley LLC) to us, and such other factors as our board of directors may deem relevant. Medley Management Inc. is a holding company and has no material assets other than its ownership of Medley LLC. We intend to cause Medley LLC to make distributions to us in an amount sufficient to cover cash dividends, if any, declared by us. If Medley LLC makes such distributions to Medley Management Inc., the other holders of LLC Units will be entitled to receive equivalent distributions. Exchange rights of holders of LLC Units Prior to this offering we will enter into an exchange agreement with our pre-IPO owners so that they may, TABLE OF CONTENTS from and after the first anniversary of the date of the completion of this offering (subject to the terms of the exchange agreement) exchange their LLC Units for shares of Class A common stock of Medley Management Inc. on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications. See Certain Relationships and Related Person Transactions Exchange Agreement. Transfer restrictions applicable to our pre-IPO owners Other than Medley Management Inc., holders of LLC Units, including our pre-IPO owners, will, subject to limited exceptions, be prohibited from transferring any LLC Units held by them upon consummation of this offering, or any shares of Class A common stock received upon exchange of such LLC Units, until the third anniversary of this offering without our consent. Thereafter and prior to the fourth and fifth anniversaries of this offering, such holders may not transfer more than 33 1/3% and 66 2/3%, respectively, of the number of LLC Units held by them upon consummation of this offering, together with the number of any shares of Class A common stock received by them upon exchange therefor, without our consent. See Organizational Structure Organizational Structure Following this Offering. Tax receivable agreement Future exchanges of LLC Units for shares of Class A common stock are expected to result in increases in the tax basis of the tangible and intangible assets of Medley LLC. These increases in tax basis may increase (for tax purposes) depreciation and amortization deductions and therefore reduce the amount of tax that Medley Management Inc. would otherwise be required to pay in the future. Prior to the completion of this offering, we will enter into a tax receivable agreement with the holders of LLC Units that provides for the payment by Medley Management Inc. to exchanging holders of LLC Units of 85% of the benefits, if any, that Medley Management Inc. is deemed to realize as a result of these increases in tax basis and of certain other tax benefits related to entering into the tax receivable agreement, including tax benefits attributable to payments under the tax receivable agreement. See Certain Relationships and Related Person Transactions Tax Receivable Agreement.
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+PROSPECTUS SUMMARY The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements appearing elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in our ADSs discussed under "Risk Factors," before deciding whether to buy our ADSs. This prospectus contains information from a report dated July 2014 commissioned by us and prepared by Frost & Sullivan, an independent market research firm, to provide industry and other information and illustrate our position in the e-cigarette industry in China and worldwide. Our Business We are a world-leading e-cigarette company. According to Frost & Sullivan, we were the second largest e-cigarette designer and manufacturer in the world in terms of both revenues and production volume in 2013. We design and produce a broad range of e-cigarette products, including disposable e-cigarettes, rechargeable e-cigarettes and e-cigarette accessories. In May 2014, we launched our own brand of rechargeable e-cigarette, Ekmizer, a personal vaporizer that allows users to re-fill liquid solutions on their own, which we primarily distribute through e-commerce channels. We are a technology-driven company with an extensive global patent portfolio relating to core e-cigarette technologies. As of June 30, 2014, we and our founders had 334 e-cigarette related patents registered in China, two patents and 150 community designs registered in the European Union, or EU, and 13 patents registered in the United States. In addition, as of June 30, 2014, we and our founders had 48 international applications published and 466 filed under the Patent Cooperation Treaty, or PCT. According to Frost & Sullivan, as of June 30, 2014, we or our founders owned approximately 25% of e-cigarette related patents, published pending patent applications and community design in key jurisdictions and approximately 36% of the e-cigarette related published international applications under the PCT. We have established a co-operative education program with Hunan Agricultural University, a leading tobacco research institute in China, which gives us access to advanced testing facilities and allows us to keep abreast of the latest industry developments. We leverage our strong research and development capabilities to design and develop innovative e-cigarette products that cater to varying customer demands. For example, we introduced the first e-waterpipe, an electronic vaporizer which resembles a traditional waterpipe or hookah and produces larger amount of smokes than other e-cigarette products, in 2011. We manufacture high quality e-cigarette products in Guangdong Province, China. We have received major international certifications for our products and production processes, which demonstrates our production management capabilities and commitment to high quality. We leverage our comprehensive quality assurance procedures to manufacture e-cigarette products that adhere to the manufacturing requirements which are usually applied to food and drug manufacturers rather than the more relaxed requirements applied to electronic product manufacturers. In 2012, 2013 and the nine months ended September 30, 2014, we produced and sold 12.3 million, 47.3 million and 49.0 million units of e-cigarette products, respectively. We have a strong customer base with customers from over 20 countries. Customers of our e-cigarette products include a majority of the five largest global tobacco companies as well as top independent e-cigarette brands. We are a supplier to five of the top ten global e-cigarette brands as measured by retail revenue in 2013. Our five largest customers individually accounted for 23.5%, 16.0%, 14.4%, 9.7% and 8.9% of our revenues in 2013, respectively, and 81.2%, 4.8%, 2.6%, 2.4% and 2.3% of our revenues for the nine months ended September 30, 2014, respectively. In the aggregate, our five largest customers accounted for 72.5% and 93.3% of our revenues in 2013 and for the nine months ended September 30, 2014, respectively. American Accessories International, L.L.C., or AAI, is our largest customer for the nine months ended September 30, 2014. AAI is sourcing e-cigarette manufacturing for Nu Mark, a wholly owned subsidiary of Altria Group, Inc. We are also capable of AMENDMENT NO. 2 TO FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents customizing production lines based on customer requirements for design, quality and quantity. We promote our brand and products through e-commerce, including through our own online platform, other established online marketplaces and other major online channels in China. We also actively participate in major international tobacco exhibitions to introduce our technology and products to potential customers and increase our visibility and reputation internationally. Our business has grown significantly in recent years. Our revenues increased from $21.3 million in 2012 to $79.7 million in 2013. Our revenue increased by 50.2% from $58.3 million for the nine months ended September 30, 2013 to $87.6 million for the nine months ended September 30, 2014. Our net income increased from $0.7 million in 2012 to $13.3 million in 2013. Our net income increased by 80.1% from $10.2 million for the nine months ended September 30, 2013 to $18.4 million for the nine months ended September 30, 2014. Our Industry The global e-cigarette market is in the early stage of development. According to Frost & Sullivan, the global e-cigarette market in terms of retail revenue grew from $482.2 million in 2009 to $1,844.1 million in 2012 and further to $4,776.8 million in 2013. It is expected to grow at a compound annual growth rate, or CAGR, of 52.3% to reach $39,195.6 million in 2018, according to Frost & Sullivan. The world's largest e-cigarette markets are the United States and the EU. The robust growth of the global e-cigarette market is mainly attributable to factors including: (i) increasing consumer acceptance of e-cigarette products resulting from the conversion of traditional cigarette smokers and new user uptake; (ii) the entry of tobacco companies with significant resources for marketing activities through acquisitions or the introduction of their own e-cigarette product lines; and (iii) continued innovation and product development by e-cigarette manufacturers. According to Frost & Sullivan, China is the world's largest production base for e-cigarette products. Chinese manufacturers produced approximately 95% of the world's e-cigarette products in 2013. Key competitive differentiators include patent coverage, access to raw materials, labor costs, customer relationships and ability to adhere to potentially stricter regulatory requirements. Patent coverage is a particularly important barrier to entry for both specific product lines and the industry in general. Market players with comprehensive patent portfolios enjoy substantial competitive advantages, such as stronger negotiation positions with customers and a reputable client base of global companies. Our Strengths We believe that the following competitive strengths enable us to take advantage of the rapid growth of the e-cigarette industry and compete effectively in the global e-cigarette market: industry-leading research and development capability evidenced by an extensive global patent portfolio and innovative products; established relationships with a diversified global customer base; world-class production capabilities driving quality and cost efficiency; large-scale production volume and capacity; and experienced management team with vision, proven track record and strong execution capability. Our Strategies We seek to maximize shareholder value by solidifying our position as one of the global market leaders in the design and production of e-cigarette products. To achieve this goal, we intend to pursue the following strategies: continue investing in and further strengthening our research, development and innovation capabilities; Kimree, Inc. (Exact name of Registrant as specified in its charter) Not Applicable (Translation of Registrant's name into English) Cayman Islands (State or other jurisdiction of incorporation or organization) 2111 (Primary Standard Industrial Classification Code Number) Not Applicable (I.R.S. Employer Identification Number) Xiagang Section, Luotang Village, Shuikou Street Huicheng District, Huizhou, Guangdong Province 516005 People's Republic of China Tel: +86 752 575-3388 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) Table of Contents further strengthen our customer relationships and expand our product offerings; expand our geographical coverage to access a diversified international customer base; build our own brand and increase our distribution channels through e-commerce and mobile technology; and increase automated production capabilities to drive cost-efficient manufacturing. Our Challenges The successful execution of our strategies is subject to risks and uncertainties related to our business and industry, including those relating to: our reliance on a small number of major customers; our lack of long-term purchase orders or commitments from customers; our limited operating history; the intense competition we face; our failure to further improve our technology and develop new products; the cost and supply of key raw materials; product defects which may damage our reputation and expose us to liability; the difficulty for e-cigarettes to continue to gain widespread acceptance; our dependence on the growth of global outsourcing in the e-cigarette industry; and the increasingly stringent regulations on the sale and use of e-cigarettes. See
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+Prospectus Summary 1
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+This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. Before you decide to invest in our common stock, you should read this entire prospectus carefully, including our financial statements and the related notes thereto and the matters discussed in the Risk Factors section. Overview We are the holding company for First Trade Union Bank, or the Bank, which is headquartered in Boston, Massachusetts. We provide financial products and services on a regional and nationwide basis, including through our website, www.ftub.com, and mobile banking and payment applications. We engage in commercial and consumer banking but our business is different from most community banks because: Our retail banking growth strategy is based on providing financial products and services through virtual banking solutions, including online and mobile banking, to meet emerging consumer banking demands, rather than on traditional branches. Our virtual banking solutions allow us to develop consumer client relationships nationwide without the need for physical branch locations and include a paperless account opening process, unlimited ATM rebates, overdraft protection and transaction-oriented mobile banking applications, or apps, for smartphones and tablets. We use affinity-based strategic marketing partnerships to pursue large numbers of deposit relationships utilizing sophisticated marketing analytics in combination with our virtual banking solutions. We attract deposits from and offer related treasury management services to pension fund, union, municipal and not-for-profit entities. Our sophisticated treasury management services, coupled with the deep knowledge and capabilities we have developed through our historical provision of such services, position us to continue to penetrate these markets to access high quality, low cost deposit funding. Our diverse base of loan clients, which includes traditional community bank clients, such as commercial and commercial real estate borrowers, is enhanced by our commitment to specialty financing areas, including SBA lending, lending to high net worth individuals for the purchase of luxury yachts, and other types of lending. Our virtual banking strategy will allow us to achieve increased economies of scale as we grow our business. We believe that there are significant opportunities for asset and deposit growth through further penetration of our current target markets. We further believe that we can grow our retail deposit franchise through our virtual banking solutions without investment in a traditional branch network. We are currently owned by New England Carpenters Pension Fund and New England Carpenters Guaranteed Annuity Fund, together, the New England Carpenters Combined Funds, which formed the Bank in 1987, and the Empire State Carpenters Pension Fund, which acquired its initial interest in 2006. This offering will provide the capital necessary to support our growth strategy and will allow the New England Carpenters Combined Funds and the Empire State Carpenters Pension Fund (collectively, the Funds) to reduce their ownership levels below 5.0% so that they will no longer be deemed to be savings and loan holding companies. As savings and loan holding companies, the Funds are required to serve as a source of financial strength for the Bank and are each considered to be a banking entity for purposes of section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, also referred to as the Volcker Rule, which prohibits banking entities from engaging in the types of investments that are commonly made by pension funds. Given their status as pension funds, the Funds do not want to remain subject to these limitations. In anticipation of this offering, we have taken, or will take, a number of actions in respect to our operations and structure, including: Undertaking a name change and rebranding in order to better communicate our value proposition and market strategy; Table of Contents The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling stockholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY SUBJECT TO COMPLETION DATED NOVEMBER 3, 2014 Prospectus 5,000,000 Shares This is an initial public offering of common stock of Radius Bancorp Inc. We expect the initial public offering price to be between $11.75 and $13.75 per share. We are offering 1,330,551 shares of our common stock. The selling stockholders identified in this prospectus are selling an additional 3,669,449 shares of common stock. We will not receive any proceeds from the sale of the shares by the selling stockholders. Prior to this offering, there has been no public market for our common stock. We applied to list our common stock on the NASDAQ Global Market under the symbol RADB. We are an emerging growth company as defined by the Jumpstart Our Business Startups Act of 2012 and, as such, we have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. Investing in our common stock involves a high degree of risk. See Risk Factors beginning on page 12 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Shares of our common stock are not savings accounts, deposits or other obligations of any of our bank or non-bank subsidiaries and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. PER SHARE TOTAL Initial Public Offering Price $ $ Underwriting Discounts and Commissions(1) $ $ Proceeds, before expenses, to us $ $ Proceeds, before expenses, to selling stockholders $ $ (1) See Underwriting for a description of the compensation payable to the underwriters. The underwriters expect to deliver the shares of common stock to purchasers on or about , 2014. We have granted the underwriters an option for a period of 30 days to purchase up to 750,000 additional shares of common stock solely to cover over-allotments, if any. Joint Book-Running Managers: Baird Sandler O Neill + Partners, L.P. Co-Managers: Janney Montgomery Scott Wunderlich Securities The date of this prospectus is , 2014. Table of Contents Transition to a board of directors comprised of independent members, other than the Chief Executive Officer, a majority of whom will join the board upon the completion of this offering; Converting our New Hyde Park, New York retail branch into a non-deposit gathering business center in alignment with our virtual banking strategy; Execution of deposit retention agreements with each of the Funds, which together (with their related parties) control $159.7 million, or 26.8%, of our deposits as of June 30, 2014, pursuant to which the Funds have agreed to maintain certain deposit relationships with the Bank for a period of no less than three years following the completion of this offering; and Termination of the collective bargaining agreement with Commercial Workers International Union covering sixteen of our employees. As of June 30, 2014, on a consolidated basis, we had total assets of $702.8 million, total loans and loans held for sale of $566.5 million, total deposits of $596.9 million and stockholders equity of $56.3 million. In recent years we have focused on transitioning towards becoming a high performing bank, improving the quality of our loan portfolio and executing our growth strategy while emphasizing enterprise-wide risk management. Our ratio of nonperforming assets to total assets was 1.25% as of June 30, 2014, as compared to 1.92% at December 31, 2011. Additionally, over the same period, total loans and loans held for sale have increased by $177.4 million, or 45.6%, and deposits have increased $123.8 million, or 26.2%. Net income increased $1.1 million, or 131%, to $2.0 million for the year ended December 31, 2013 from $869 thousand for the year ended December 31, 2011. Our Business Strategy Our business strategy is to combine traditional community banking activities, such as commercial and consumer banking, with a commitment to specialty financing, treasury management services, and customer acquisition without a traditional branch network. The primary components of our business strategy are to: Offer a comprehensive virtual banking product suite that allows us to capitalize on growing and evolving demand for online and mobile banking solutions and payment apps; Develop affinity-based strategic marketing partnerships that enable us to market at a relatively low cost directly to partner organizations members; Expand the scope of our treasury management services and deposit gathering further into largely underserved pension fund, union, municipal and not-for-profit entities, which represents a significant growth opportunity; Engage in traditional commercial and consumer banking, supplemented by specialty financing in areas that include SBA, yacht lending to high net worth individuals, and other types of lending; Leverage our current infrastructure and technology to grow, achieve economies of scale and deliver higher levels of profitability; and Maintain disciplined risk management, resulting in consistently above-average asset quality. Our Business Lines We provide financial products and services to a client base that is comprised of traditional clients, including commercial, middle market and small businesses; specialty financing clients; union, pension fund, municipalities and not-for-profit clients; and consumers. We offer lending and deposit products, services and solutions that are designed to meet our clients banking needs while maintaining a disciplined approach to risk management and our focus on generating attractive risk-adjusted returns. Our diversified lending and funding strategy is not dependent upon a traditional bank branch network and positions us well to drive growth and profitability. Table of Contents Table of Contents Lending We lend to traditional community bank clients, with a focus on increasing our lending to various specialty clients as well. We believe that the markets for these specialty clients present substantial asset growth opportunities at attractive pricing and risk levels and that we are well positioned, given our experience with such clients, to further penetrate these markets. We are also prepared to pursue growth opportunities with other specialty clients as such opportunities arise. Commercial and Industrial Lending. We provide financing to a number of traditional and specialty finance clients, including small and middle market businesses and SBA loan recipients. We have developed an experienced team that is capable of understanding and lending to these clients. We believe that we can be successful lending to these clients and generate asset growth and revenue opportunities by doing so, including by strategically selling, as we have in the past, SBA loans. At June 30, 2014, we had $68.9 million of commercial and industrial loans representing 12.2% of our loan portfolio, or an increase of 22.7% from December 31, 2013. Commercial Real Estate, Multi-family and Construction Lending. We originate commercial real estate and multi-family loans to experienced investors with an established history of successful investment in a variety of property types including retail, commercial office buildings, multi-family properties, mixed-use properties and owner-occupied commercial real estate (including SBA 504 loans). While the cash flow from income-producing properties is the primary source of repayment in our commercial real estate and multi-family portfolio, a combination of equity invested in each property and generally a required personal guarantee from the investor provides strong secondary support. The majority of our commercial real estate and multi-family loans are made to borrowers and properties located in the greater Boston, Massachusetts market and other markets in the New England region with a smaller proportion of commercial real estate and multi-family loans in New York, predominantly in Suffolk and Nassau counties. At June 30, 2014, we had $174.6 million of commercial real estate and multi-family loans, representing 30.9% of our loan portfolio. Loans made for business purposes, including owner-occupied real estate loans, that are secured by commercial real estate comprised 28.9%, or $50.5 million, of the commercial real estate and multi-family portfolio at June 30, 2014. Our construction loans are primarily for commercial projects and typically require the personal guarantee of the developer. Properties related to our construction loans are frequently pre-leased at a level that will generate sufficient cash flow to service the fully advanced construction loan on an amortizing basis upon the completion of construction. At June 30, 2014, we had $5.6 million of construction loans, currently all of which are secured by commercial projects located in Massachusetts or New York. Yacht Lending. We have developed substantial expertise in yacht lending and provide financing to high net worth individuals for the purchase of personal luxury yachts generally ranging from $1 million to $5 million in value. We believe that lending within that target market is advantageous to us from a credit risk management perspective in that we predominantly lend to previous yacht owners. The average customer FICO score for borrowers in our yacht loan portfolio was 753 and loan-to-value was 65% as of June 30, 2014. We began making yacht loans in 2009 and we have not experienced any defaults in this portfolio. At June 30, 2014, we had $39.2 million of yacht loans, representing 7.0% of our loan portfolio. Residential Mortgage Lending. We underwrite and purchase high quality, whole jumbo mortgage loans individually, servicing released, from banks and mortgage companies with which we have relationships in the greater Boston, Massachusetts market. While we are not in the business of originating residential mortgage loans, our strategy allows us to maintain a balanced loan portfolio and provides strong risk-adjusted returns without the cost and regulatory compliance concerns associated with the direct origination of these assets. Between December 2010 and December 2013, a period during which Table of Contents TABLE OF CONTENTS Page Summary 1
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+This summary highlights material information from this prospectus and may not contain all the information that is important to you. To understand the conversion and offering fully, you should read this entire document carefully. In this prospectus, the terms we, us and our refer to Beneficial Mutual Bancorp, Inc. and its consolidated subsidiaries or its successor Beneficial Bancorp, Inc., unless the context requires otherwise. Our Company Beneficial Bank. Beneficial Bank, whose legal name is Beneficial Mutual Savings Bank, is a Pennsylvania-chartered stock savings bank headquartered in Philadelphia, Pennsylvania. Beneficial Bank has provided community banking services to individuals and small- to medium-sized businesses in the Delaware Valley area since 1853. Beneficial Bank is the oldest and largest bank headquartered in Philadelphia with 58 offices in the greater Philadelphia and South New Jersey regions. Upon the completion of the conversion, Beneficial Bank intends to change its legal name from Beneficial Mutual Savings Bank to Beneficial Bank. Beneficial Bank offers traditional financial services to consumers and businesses in its market areas. Beneficial Bank attracts deposits from the general public and uses those funds to originate a variety of loans, including commercial real estate loans, commercial business loans, one- to four-family real estate loans, consumer loans, home equity loans and constructions loans. Beneficial Bank also offers insurance brokerage and investment advisory services through its wholly owned subsidiaries, Beneficial Insurance Services, LLC and Beneficial Advisors, LLC, respectively. At June 30, 2014, Beneficial Bank exceeded all regulatory capital requirements and was considered a well-capitalized bank. Beneficial Bank has not participated in any of the U.S. Treasury s capital raising programs for financial institutions. Beneficial Bank is regulated by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation. Beneficial Mutual Bancorp. Beneficial Mutual Bancorp, whose legal name is Beneficial Mutual Bancorp, Inc., is the savings and loan holding company for Beneficial Bank and is regulated by the Board of Governors of the Federal Reserve System (the Federal Reserve Board ). In July 2007, Beneficial Mutual Bancorp completed its initial public offering in which it sold 23,606,625 shares of its outstanding common stock to the public and issued 45,792,775 shares of its outstanding common stock to Beneficial Savings Bank MHC. Beneficial Mutual Bancorp s common stock currently trades on the Nasdaq Global Select Market under the symbol BNCL. At June 30, 2014, Beneficial Mutual Bancorp had consolidated total assets of $4.43 billion, net loans of $2.32 billion, total deposits of $3.51 billion and total shareholders equity of $612.7 million. As of the date of this prospectus, Beneficial Mutual Bancorp had shares of common stock outstanding. After completion of the offering, Beneficial Mutual Bancorp will cease to exist. Beneficial Savings Bank MHC. Beneficial Savings Bank MHC is the federally chartered mutual holding company of Beneficial Mutual Bancorp. Beneficial Savings Bank MHC s sole business activity is the ownership of 45,792,775 shares of common stock of Beneficial Mutual Bancorp, or 60.6% of the common stock outstanding as of the date of this prospectus. Beneficial Savings Bank MHC engages in no other business activities and has no shareholders. After completion of the conversion and offering, Beneficial Savings Bank MHC will cease to exist. Beneficial Bancorp. Beneficial Bancorp is a newly formed Maryland corporation. Following the completion of the conversion and offering, Beneficial Bancorp will be the bank holding company for Beneficial Bank and will succeed Beneficial Mutual Bancorp as the publicly-traded holding company of Beneficial Bank. The shares of Beneficial Bancorp s common stock will also trade on the Nasdaq Global Select Market under the symbol BNCL. Our principal executive offices are located at 1818 Market Street, Philadelphia, Pennsylvania 19103 and our telephone number is (215) 864-6000. Our web site address is www.thebeneficial.com. Information on our web site should not be considered a part of this prospectus. Acquisition History Acquisitions of banking institutions and other financial service companies within and surrounding our market area have been, and we expect will continue to be, a key component of our strategy. In 2007, in connection with the closing of our initial public offering, Beneficial Mutual Bancorp acquired FMS Financial Corporation and its wholly owned Table of Contents QUESTIONS AND ANSWERS You should read this document for more information about the conversion and offering. The Proxy Vote Q. What am I being asked to approve? A. Beneficial Mutual Bancorp shareholders as of [RECORD DATE] are asked to vote on the plan of conversion. Under the plan of conversion, Beneficial Bank will convert from the mutual holding company form of organization to the stock holding company form, and as part of such conversion, our newly formed stock holding company, Beneficial Bancorp, will offer for sale shares of its common stock representing Beneficial Savings Bank MHC s 60.6% ownership interest in Beneficial Mutual Bancorp. In addition to the shares of common stock to be issued to those who purchase shares in the offering, public shareholders of Beneficial Mutual Bancorp as of the completion of the conversion and offering will receive shares of Beneficial Bancorp common stock in exchange for their existing shares of Beneficial Mutual Bancorp common stock. The exchange will be based on an exchange ratio that will result in Beneficial Mutual Bancorp s existing public shareholders owning approximately the same percentage of Beneficial Bancorp common stock as they owned of Beneficial Mutual Bancorp immediately before the conversion and offering. Shareholders also are asked to vote on the following informational proposals with respect to the articles of incorporation of Beneficial Bancorp: Approval of a provision in Beneficial Bancorp s articles of incorporation requiring a super-majority vote to approve certain amendments to Beneficial Bancorp s articles of incorporation; and Approval of a provision in Beneficial Bancorp s articles of incorporation to limit the voting rights of shares beneficially owned in excess of 10% of Beneficial Bancorp s outstanding voting stock. The provisions of Beneficial Bancorp s articles of incorporation, which are summarized as informational proposals were approved as part of the process in which the board of directors of Beneficial Mutual Bancorp approved the plan of conversion. These proposals are informational in nature only because the Federal Reserve Board s regulations governing mutual-to-stock conversions do not provide for votes on matters other than the plan of conversion and the contribution to our charitable foundation. While we are asking you to vote with respect to each of the informational proposals listed above, the proposed provisions for which an informational vote is requested will become effective if shareholders approve the plan of conversion, regardless of whether shareholders vote to approve any or all of the informational proposals. The provisions of Beneficial Bancorp s articles of incorporation that are summarized as informational proposals may have the effect of deterring or rendering more difficult attempts by third parties to obtain control of Beneficial Bancorp, if such attempts are not approved by the board of directors, or may make the removal of the board of directors or management, or the appointment of new directors, more difficult. In addition, shareholders will vote on a proposal to contribute to The Beneficial Foundation $1.0 million in cash and a proposal to adjourn the special meeting, if necessary, to solicit additional proxies if there are not sufficient votes at the time of the special meeting to approve the plan of conversion and/or the contribution to the charitable foundation. YOUR VOTE IS IMPORTANT. WE CANNOT COMPLETE THE CONVERSION AND OFFERING AND CONTRIBUTE TO THE CHARITABLE FOUNDATION UNLESS THOSE PROPOSALS RECEIVES THE AFFIRMATIVE VOTE OF A MAJORITY OF SHARES HELD BY OUR PUBLIC SHAREHOLDERS. Q. What is the conversion and related stock offering? A. Beneficial Bank is converting from a partially-public mutual holding company structure to a fully-public stock holding company ownership structure. Currently, Beneficial Savings Bank MHC owns 60.6% of Beneficial Mutual Bancorp s common stock. The remaining 39.4% of Beneficial Mutual Bancorp s common stock is owned by public shareholders. As a result of the conversion, Beneficial Bancorp will become the parent of Beneficial Bank. Shares of common stock of Beneficial Bancorp, representing the 60.6% ownership interest of Beneficial Savings Bank MHC in Beneficial Mutual Bancorp, are being offered for sale to eligible depositors of Beneficial Bank and, possibly, to the public. At the completion of the conversion and offering, public shareholders of Beneficial Mutual Bancorp will exchange their shares of Beneficial Mutual Bancorp common stock for shares of common stock of Beneficial Bancorp. After the conversion and offering are completed, Beneficial Bank will be a wholly-owned subsidiary of Beneficial Bancorp, and 100% of the common stock of Beneficial Bancorp will be owned by public shareholders. As a result of the conversion and offering, Beneficial Mutual Bancorp and Beneficial Savings Bank MHC will cease to exist. Table of Contents SUMMARY This summary highlights material information from this document and may not contain all the information that is important to you. To understand the conversion and offering fully, you should read this entire document carefully. Special Meeting of Shareholders Date, Time and Place; Record Date The special meeting of Beneficial Mutual Bancorp shareholders is scheduled to be held at at : .m., Eastern time, on [MEETING DATE]. Only Beneficial Mutual Bancorp shareholders of record as of the close of business on [RECORD DATE] are entitled to notice of, and to vote at, the special meeting of shareholders and any adjournments or postponements of the meeting. Purpose of the Meeting Shareholders will be voting on the following proposals at the special meeting: 1. Approval of the plan of conversion; 2. An informational proposal regarding approval of a provision in Beneficial Bancorp s articles of incorporation requiring a super-majority vote to approve certain amendments to Beneficial Bancorp s articles of incorporation; 3. An informational proposal regarding approval of a provision in Beneficial Bancorp s articles of incorporation to limit the voting rights of shares beneficially owned in excess of 10% of Beneficial Bancorp s outstanding voting stock; 4. Approval of the contribution to the charitable foundation; and 5. The approval of the adjournment of the special meeting, if necessary, to solicit additional proxies if there are not sufficient votes at the time of the special meeting to approve the plan of conversion and the contribution to the charitable foundation. The provisions of Beneficial Bancorp s articles of incorporation, which are summarized as informational proposals 2 and 3 were approved as part of the process in which the board of directors of Beneficial Mutual Bancorp approved the plan of conversion. These proposals are informational in nature only because the Federal Reserve Board s regulations governing mutual-to-stock conversions do not provide for votes on matters other than the plan of conversion and the contribution to the charitable foundation. While we are asking you to vote with respect to each of the informational proposals listed above, the proposed provisions for which an informational vote is requested will become effective if shareholders approve the plan of conversion, regardless of whether shareholders vote to approve any or all of the informational proposals. The provisions of Beneficial Bancorp s articles of incorporation, which are summarized as informational proposals, may have the effect of deterring or rendering more difficult attempts by third parties to obtain control of Beneficial Bancorp, if such attempts are not approved by the board of directors, or may make the removal of the board of directors or management, or the appointment of new directors, more difficult. Vote Required Proposal 1: Approval of the Plan of Conversion. Approval of the plan of conversion requires the affirmative vote of holders of at least two-thirds of the outstanding shares of Beneficial Mutual Bancorp, including the shares held by Beneficial Savings Bank MHC and a majority of the outstanding shares of Beneficial Mutual Bancorp, excluding the shares held by Beneficial Savings Bank MHC. Informational Proposals 2 and 3. While we are asking you to vote with respect to each of the informational proposals listed above, the proposed provisions for which an informational vote is requested will become effective if shareholders approve the plan of conversion, regardless of whether shareholders vote to approve any or all of the informational proposals. Proposal 4: Approval of the Contribution to the Charitable Foundation. The contribution of $1.0 million in cash to The Beneficial Foundation must be approved by at least a majority of the outstanding shares entitled to be cast at the special meeting by Beneficial Mutual Bancorp shareholders, and by at least a majority of the outstanding shares entitled to be cast at the special meeting by Beneficial Mutual Bancorp shareholders other than Beneficial Savings Bank MHC. Table of Contents TABLE OF CONTENTS Page THE OFFERING 1 Securities Offered 1 Election to Purchase Beneficial Bancorp Inc. Common Stock in the Offering 1 Purchase Priorities 1 Value of Participation Interests 2 Method For Directing Your Investment Election 2 Time for Directing Your Investment Election 2 Irrevocability of Your Investment Election and Restrictions on Transferability 2 Purchase Price of Beneficial Bancorp Inc. Common Stock 2 Composition of the Employer Stock Fund 2 Voting and Tender Rights of Beneficial Bancorp Inc. Common Stock 3 Future Direction to Purchase Common Stock 3 DESCRIPTION OF THE KSOP 4 Introduction 4 Eligibility and Participation 4 Contributions Under the KSOP 4 KSOP Investments 5 Benefits Under the KSOP 7 Withdrawals and Distributions from the KSOP 8 ADMINISTRATION OF THE KSOP 9 Trustees 9 Reports to KSOP Participants 9 Plan Administrator 9 Amendment and Termination 9 Merger, Consolidation or Transfer 9 Federal Income Tax Consequences 9 Restrictions on Resale 10 SEC Reporting and Short-Swing Profit Liability 11 Financial Information Regarding Plan Assets 11 LEGAL OPINION 11 Table of Contents THE OFFERING Securities Offered Beneficial Bancorp is offering KSOP participants the opportunity to purchase participation interests in shares of Beneficial Bancorp common stock through the KSOP. A participation interest represents your indirect ownership of a share of common stock that is acquired by the KSOP pursuant to your election, and is the equivalent, in this Offering, to one share of common stock. At a purchase price of $10.00 per share, the KSOP trustee may subscribe for up to 3,737,000 shares of common stock in the Offering. The interests offered by means of this prospectus supplement are conditioned on the close of the Offering. Certain subscription rights and purchase limitations also govern your investment in the Offering. See The Conversion and Offering Subscription Offering and Subscription Rights and Limitations on Purchases of Shares in the prospectus attached to this prospectus supplement for further discussion of these subscription rights and purchase limitations. This prospectus supplement contains information regarding the KSOP. The attached prospectus contains information regarding the Offering and the financial condition, results of operations and business of Beneficial Mutual Bancorp and its affiliates. The address of the principal executive office of Beneficial Bank is 1818 Market Street, Philadelphia, Pennsylvania 19103. The telephone number of Beneficial Bank is (215) 864-6000. All questions about this prospectus supplement should be addressed to Cecile Colonna, Senior Vice President, Director of Human Resources at Beneficial Bank, at (215) 864-6094; email: ccolonna@thebeneficial.com. Questions about the Offering, the prospectus, or obtaining a stock order form to purchase stock in the offering outside the KSOP may be directed to the Stock Information Center at (800) - , Monday through Friday, a.m. through p.m. Election to Purchase Beneficial Bancorp Inc. Common Stock in the Offering If you elect to participate in the Offering using all or a portion of your KSOP funds (excluding funds currently invested in the Beneficial Mutual Bancorp, Inc. Stock Fund) you must complete and submit the blue investment form included with this prospectus supplement ( Investment Form ) to Cecile Colonna. See Method for Directing Your Investment Election and Time for Directing Your Investment Election for detailed information on how to participate in the Offering using your KSOP funds. Purchase Priorities All KSOP participants are eligible to direct the KSOP trustee to use all or a portion of their KSOP assets (excluding funds currently invested in Beneficial Mutual Bancorp, Inc. Stock Fund) to purchase shares in the Offering. However, your election will be subject to the following purchase priorities: Subscription Offering: 1. Persons with aggregate balances of $50 or more on deposit at Beneficial Bank as of the close of business on June 30, 2013. 2. Persons with aggregate balances of $50 or more on deposit at Beneficial Bank as of the close of business on September 30, 2014 who are not eligible in category 1 above. 3. Beneficial Bank s depositors as of the close of business on , who are not eligible under categories 1 or 2 above. Community Offering: Shares of common stock not purchased in the subscription offering will be offered for sale to the general public in a community offering, with a preference given first to natural persons (including trusts of natural persons) residing in Bucks, Chester, Delaware, Montgomery and Philadelphia Counties in Pennsylvania and in Burlington, Camden and Gloucester Counties in New Jersey, second to Beneficial Mutual Bancorp s public shareholders as of and finally to members of the general public. If you have rights to purchase common stock in the subscription offering, you may use all or a portion of your KSOP account balance (excluding funds invested in Beneficial Mutual Bancorp, Inc. Stock Fund) to pay for the shares of common stock. However, if you are unable to purchase shares of common stock in the subscription offering, your order will be treated as a community offering order. Subscription offering orders will have preference over community offering orders in the event of oversubscription. Table of Contents BENEFICIAL BANK KSOP INVESTMENT FORM SPECIAL ELECTION FOR STOCK OFFERING ONLY Name of Plan Participant: Social Security Number: 1. Instructions. In connection with the Offering, you may direct up to 100% of your current KSOP account balance (excluding funds currently invested in the Beneficial Mutual Bancorp, Inc. Stock Fund) into the Beneficial Bancorp Stock Fund (the Employer Stock Fund ). The percentage of your KSOP account (up to 100%) you elect to liquidate below will be used to purchase shares of common stock in the Offering through the Employer Stock Fund. To use your KSOP funds to participate in the Offering, you must complete, sign and submit this form to Cecile Colonna by , unless extended by Beneficial Bank (the KSOP Investment Deadline ). Current Beneficial Bank employees should return their forms through inter-office mail. Former Beneficial Bank employees should return their forms using the business reply envelope that has been provided. A representative for the Plan Administrator will retain a copy of this form and return a copy to you. If you need any assistance in completing this form, please contact Cecile Colonna at . If you do not complete and return this form to Cecile Colonna by the KSOP Investment Deadline, the funds credited to your account under the KSOP will continue to be invested in accordance with your prior investment directions or in accordance with the terms of the Plan if no investment directions have been provided. 2. Investment Directions. I hereby authorize the Plan Administrator to direct the Trustee to liquidate my investments in the KSOP as noted below (in multiples of not less than 1%) and use the cash to invest in the Offering through the Employer Stock Fund: Fund Name Wells Fargo Stable Return Fund C % Vanguard Total Bond Market Index Fund Signal (VBTSX) % Vanguard Target Retirement Income Fund Investor (VTINX) % Vanguard Target Retirement 2010 Fund Investor (VTENX) % Vanguard Target Retirement 2015 Fund Investor (VTXVX) % Vanguard Target Retirement 2020 Fund Investor (VTWNX) % Vanguard Target Retirement 2025 Fund Investor (VTTVX) % Vanguard Target Retirement 2030 Fund Investor (VTHRX) % Vanguard Target Retirement 2035 Fund Investor (VTTHX) % Vanguard Target Retirement 2040 Fund Investor (VFORX) % Vanguard Target Retirement 2045 Fund Investor (VTIVX) % Vanguard Target Retirement 2050 Fund Investor (VFIFX) % Vanguard Target Retirement 2055 Fund Investor (VTINX) % Vanguard 500 Index Fund Signal (VIFSX) % American Beacon Large Cap Value Fund Instl (AADEX) % Vanguard Mid-Cap Index Fund Signal (VMISX) % American Funds EuroPacific Growth Fund R6 (RERGX) % I understand that my election to invest in the Offering through the Employer Stock Fund is irrevocable. I understand that the funds used to invest in the Offering through the Employer Stock Fund must be divisible by $10.00, the per share price for common stock in the Offering. 3. Purchaser Information. The ability of a KSOP participant to purchase Beneficial Bancorp stock in the Offering is based upon the participant s subscription rights in the Offering. Please indicate your status (check one): A depositor of Beneficial Bank with aggregate account balances of at least $50 at the close of business on June 30, 2013, get first priority. A depositor of Beneficial Bank with aggregate account balances of at least $50 at the close of business on September 30, 2014, who is not eligible in category 1. A depositor of Beneficial Bank as of the close of business on , who is not eligible under categories 1 or 2 above. Community Offering eligible. Table of Contents PROSPECTUS (Proposed holding company for Beneficial Bank) Up to 63,250,000 Shares of Common Stock Beneficial Bancorp, Inc., a newly formed Maryland corporation that is referred to as Beneficial Bancorp throughout this prospectus, is offering common stock for sale in connection with the conversion of Beneficial Savings Bank MHC from the mutual holding company form of organization to the stock form of organization. We are offering up to 63,250,000 shares of common stock for sale on a best efforts basis, subject to certain conditions. We must sell a minimum of 46,750,000 shares to complete the offering. All shares are offered at a price of $10.00 per share. Purchasers will not pay a commission to purchase shares of common stock in the offering. The amount of capital being raised is based on an independent appraisal of Beneficial Bancorp. Most of the terms of this offering are required by regulations of the Board of Governors of the Federal Reserve System. The shares we are offering represent the 60.6% ownership interest in Beneficial Mutual Bancorp, a federal corporation, now owned by Beneficial Savings Bank MHC. The remaining 39.4% interest in Beneficial Mutual Bancorp currently owned by the public will be exchanged for shares of common stock of Beneficial Bancorp. The 29,773,861 shares of Beneficial Mutual Bancorp currently owned by the public will be exchanged for between 30,386,565 shares and 41,111,234 shares of common stock of Beneficial Bancorp so that Beneficial Mutual Bancorp s existing public shareholders will own approximately the same percentage of Beneficial Bancorp common stock as they owned of Beneficial Mutual Bancorp s common stock immediately before the conversion. We also intend to make a contribution to The Beneficial Foundation, our charitable foundation, of $1.0 million in cash in connection with the conversion. Other than shares issued in the exchange, we will not issue any shares of Beneficial Bancorp common stock to The Beneficial Foundation in connection with the conversion. Beneficial Mutual Bancorp and Beneficial Savings Bank MHC will cease to exist upon completion of the conversion and Beneficial Bancorp will succeed them. We are offering the shares of common stock in a subscription offering to eligible depositors of Beneficial Bank and Beneficial Bank s tax-qualified employee savings and stock ownership plan. Shares of common stock not purchased in the subscription offering may be offered for sale to the general public in a community offering, with a preference given to natural persons residing in Bucks, Chester, Delaware, Montgomery and Philadelphia Counties in Pennsylvania and Burlington, Camden and Gloucester Counties in New Jersey, and then to shareholders of Beneficial Mutual Bancorp. We also may offer for sale shares of common stock not purchased in the subscription or community offerings through a syndicate of broker-dealers, referred to in this prospectus as the syndicated offering, or, in our discretion after consultation with our financial advisors, in a separate firm commitment underwritten public offering. The syndicated offering may commence before the subscription and community offerings (including any extensions) have expired. The subscription, community, syndicated and firm commitment underwritten offerings are collectively referred to in this prospectus as the offering. Sandler O Neill & Partners, L.P. will assist us in selling the shares on a best efforts basis in the subscription and community offerings, and will serve as sole book-running manager for any syndicated or firm commitment underwritten offering. Sandler O Neill & Partners, L.P. is not required to purchase any shares of common stock that are sold in the subscription and community offerings. The minimum order is 25 shares. The subscription offering will end at 4:00 p.m., Eastern time, on [DATE 1]. We expect that the community offering, if held, will terminate at the same time, although it may continue without notice to you until [DATE 2] or longer if the Federal Reserve Board approves a later date. No single extension may exceed 90 days and the offering must be completed by [DATE 3]. Once submitted, orders are irrevocable unless the offering is terminated or extended beyond [DATE 2], or the number of shares of common stock to be sold is increased to more than 63,250,000 shares or decreased to less than 46,750,000 shares. If we extend the offering beyond [DATE 2], all subscribers will be notified and given the opportunity to confirm, change or cancel their orders. If you do not respond to this notice, we will promptly return your funds with interest calculated at Beneficial Bank s statement savings rate or cancel your deposit account withdrawal authorization. If we intend to sell fewer than 46,750,000 shares or more than 63,250,000 shares, we will promptly return all funds and set a new offering range. All subscribers will be resolicited and given the opportunity to place a new order. Funds received before the completion of the subscription and community offerings will be held in a segregated account at Beneficial Bank and will earn interest at Beneficial Bank s statement savings rate, which is currently 0.25% per annum. Beneficial Mutual Bancorp s common stock currently trades on the Nasdaq Global Select Market under the symbol BNCL, and the shares of Beneficial Bancorp s common stock will continue to trade on the Nasdaq Global Select Market under the symbol BNCL.
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. Before investing, you should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus. Unless otherwise stated in this prospectus, references to: we, us, company or our company are to AR Capital Acquisition Corp.; founder shares refer to shares of our common stock initially purchased by our sponsor in a private placement prior to this offering; initial stockholders are to holders of our founder shares prior to this offering; management or our management team are to our executive officers and directors; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to shares of our common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; and sponsor are to AR Capital, LLC, a Delaware limited liability company. Our investors will receive one-half of one warrant for each unit purchased. Each whole warrant entitles the holder thereof to purchase one share of our common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. Only whole warrants are exercisable. A holder of our public warrants will not be able to exercise any one-half of one warrant unless it is combined with another one-half of one warrant. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Registered trademarks referred to in this prospectus are the property of their respective owners. We are a newly organized blank check company incorporated as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. We will seek to capitalize on the substantial deal sourcing, investing and operating expertise of our sponsor and management team to identify and complete a business combination with one or more businesses in the asset management industry, although we may pursue business combination opportunities in other industries. Our amended and restated certificate of incorporation prohibits us from effectuating a business combination with another blank check company or similar company with nominal operations. Our sponsor, co-founded in 2007 by Nicholas S. Schorsch and William M. Kahane, is an investment management firm focused on providing the retail investor publicly-registered alternative investment solutions with a focus on commercial real estate, middle market corporate lending, financial services, and energy. Our sponsor and its principals currently manage or sponsor over 20 active funds and companies. Our sponsor manages publicly-registered traded and non-traded real estate investment trusts, or REITs, across a variety of sectors, including net lease, retail, office, lodging, healthcare and industrial and has returned to investors in its sponsored core real estate programs over $11.7 billion on approximately $8.8 billion invested. In the publicly traded markets, our sponsor and its principals have formed, sponsored and listed four entities consisting of TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED SEPTEMBER 23, 2014 P R E L I M I N A R Y P R O S P E C T U S $300,000,000 AR Capital Acquisition Corp. 30,000,000 Units AR Capital Acquisition Corp. is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our common stock and one-half of one warrant. Each whole warrant entitles the holder thereof to purchase one share of our common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. Only whole warrants are exercisable. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We have also granted the underwriters a 45-day option to purchase up to an additional 4,500,000 units to cover over-allotments, if any. We will provide our stockholders with the opportunity to redeem all or a portion of their shares of our common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes, divided by the number of then outstanding shares of common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations described herein. If we are unable to complete our business combination within 24 months from the closing of this offering, we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and as further described herein. Our sponsor, AR Capital, LLC has committed to purchase an aggregate of 7,750,000 warrants (or 8,650,000 warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant ($7,750,000 in the aggregate, or $8,650,000 if the over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. We refer to these warrants throughout this prospectus as the private placement warrants. Currently, there is no public market for our units, common stock or warrants. We have applied to list our units on the NASDAQ Capital Market, or NASDAQ, under the symbol AUMAU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on NASDAQ. The common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Citigroup Global Markets Inc. informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission, or the SEC, containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that the common stock and warrants will be listed on NASDAQ under the symbols AUMA and AUMAW, respectively. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 22 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 300,000,000 Underwriting discounts and commissions and other fees 1 $ 0.55 $ 16,500,000 Proceeds, before expenses, to AR Capital Acquisition Corp. $ 9.45 $ 283,500,000 (1) Includes $0.35 per unit, or $10,500,000 (or $12,075,000 if the underwriters over-allotment option is exercised in full) in the aggregate to be placed in a trust account located in the United States comprised of (a) $0.24 per unit payable to the underwriters for deferred underwriting discounts and commissions and (b) $0.11 per unit payable to RCS Capital, or RCS, which is not a participating member in this offering, for financial advisory services in connection with the identification, evaluation, negotiation and completion of our initial business combination. RCS is a division of Realty Capital Securities, LLC, which is under common control with our sponsor. These amounts will be released from the trust account only on completion of an initial business combination, as described in this prospectus. See Underwriting on page 122. Of the $307.75 million in proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, or $353.65 million if the underwriters over-allotment option is exercised in full, $300.0 million ($10.00 per unit), or $345.0 million if the underwriters over-allotment option is exercised in full ($10.00 per unit), will be deposited into a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee, and $7.75 million (or $8.65 million if the underwriters over-allotment option is exercised in full) will be used to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our franchise and income tax obligations, the proceeds from this offering will not be released from the trust account until the earlier of (a) the completion of our initial business combination or (b) the redemption of our public shares if we are unable to complete our business combination within 24 months from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2014. Citigroup Ladenburg Thalmann , 2014 TABLE OF CONTENTS American Realty Capital Trust, Inc., American Realty Capital Properties, Inc., or ARCP (NASDAQ: ARCP), New York REIT, Inc. (NYSE: NYRT) and American Realty Capital Healthcare Trust, Inc. (NASDAQ: HCT), with an aggregate of approximately $29 billion of enterprise value, and have executed three public company sale and divestiture transactions totaling more than $7.5 billion. Our sponsor s executive team has over 125 years of combined experience in building companies and businesses across a variety of industries, and a track record of scaling these companies through public and private merger and acquisition ( M&A ) transactions. Since inception, our sponsor has organized over 20 publicly traded and non-traded companies, totalling approximately $52 billion in assets under management, and consummated approximately $25 billion in acquisitions of other publicly traded companies, public non-traded companies and private companies and portfolios while building deep-rooted institutional relationships. ARCP, currently a $23 billion enterprise value company, was initially managed by our sponsor and built through a series of value enhancing acquisitions of publicly listed and private companies. ARCP internalized the management services provided by our sponsor and its affiliates in January 2014 and became a self-administered REIT managed full-time by its own management team. Following the consummation of its initial public offering in September 2011, ARCP executed seven public and private M&A transactions totaling over $21 billion and is now the 11th largest REIT globally (by assets) and the largest net lease REIT globally (by assets), according to SNL Financial. RCS Capital Corporation (NYSE: RCAP), or RCAP, is a public full-service investment advisory firm controlled by Mr. Schorsch and Mr. Kahane focused on the direct investment channel. RCAP provides retail advice, wholesale distribution, investment management services, institutional research, investment banking and capital markets services. Since its initial public offering in May 2013, RCAP has grown through a series of nine acquisitions totaling over $1.5 billion in the independent retail advice, investment management, wholesale distribution and financial technology segments. RCAP offers retail advice and investment solutions through a network of independent groups of affiliated financial advisors and other financial professionals, and provides its network of advisors and other professionals with the technology, infrastructure and other support and services they need to serve their clients. Today, RCAP has the second largest such network in the United States, with over 9,600 financial advisors serving approximately 2.0 million retail clients and approximately $230 billion of assets under administration. RCAP also has the largest U.S. wholesale distribution network with a 46% market share as of June 30, 2014. Our sponsor s extensive experience in finding attractive deals from private and public sources and its leading capital markets position provides unique insight when sourcing new investment opportunities and creating value. The management team s experience and proximity to real-time information positions our sponsor to obtain differentiated deal flow, frequently in a non-competitive manner. We believe RCAP s prominent position as an investment bank and research firm will provide a differentiated perspective on the industry and on opportunities for potential business combinations. With respect to the foregoing examples, past performance by our management team is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to locate a suitable candidate for our initial business combination. In addition, our management team is currently involved in other businesses and is not required to devote any specific minimum amount of time to our business, which may result in a conflict of interest in allocating their time between our operations and our search for a business combination and their other businesses. See Management Directors and Executive Officers. Business Strategy We intend to employ a proactive acquisition strategy focused on companies where we believe a combination of our relationships, capital and experience can be the catalyst to transform companies and accelerate the target business growth. Our acquisition selection process will leverage our management team s network of industry and private equity sponsor relationships, as well as relationships with management teams of public and private companies, investment bankers, restructuring advisers, attorneys and accountants that we believe should provide us with a number of business combination opportunities. This network has been developed through our management team s experience in sourcing, acquiring, developing, growing, financing TABLE OF CONTENTS and selling businesses; their relationships with sellers, capital providers and target management teams; and their experience in executing transactions under varying economic and financial market conditions. Investment Criteria Consistent with this strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire a business or businesses that we believe has one or more of the following qualities: potential to experience significant growth after our acquisition; a leading position within its industry, based on our evaluation of several factors, including growth profile, competitive environment, profitability profile and sustainability of business plan; hidden intrinsic value that has not been recognized by the marketplace; and can offer attractive risk-adjusted return on investments for our stockholders. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the SEC. Initial Business Combination Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions, advisory fees and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, or FINRA, with respect to the satisfaction of such criteria. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses TABLE OF CONTENTS and we will treat the target businesses together as the initial business combination in our proxy solicitation materials or tender offer documents, as applicable. Our Investment Process In evaluating a prospective target business, we expect to conduct a due diligence review that will include, as applicable, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial and other information that will be made available to us. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm which is a member of FINRA that our initial business combination is fair to our company from a financial point of view. Members of our management team and our independent directors will directly or indirectly own shares of our common stock and warrants to purchase shares of our common stock following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity that is suitable for an entity to which he or she has current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity. We do not believe, however, that any of the foregoing fiduciary duties or contractual obligations will materially affect our ability to complete our initial business combination because we are focused on identifying and completing a business combination with one or more asset management businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions, advisory fees and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination, whereas the other entities to which our executive officers and directors currently have fiduciary duties or contractual obligations either are not seeking transactions with businesses in the asset management industry or other industries we intend to pursue or do not have the financial capacity or mandate to engage in a business combination transaction having the fair market value required for our initial business combination. Our sponsor, executive officers and independent directors have agreed not to participate in the formation of, or become an officer or director of, any other blank check company that is formed in the United States until we have entered into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination within the required timeframe. Our executive offices are located at 405 Park Avenue 2nd floor, New York, NY 10022, and our telephone number is (212) 415-6500. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of TABLE OF CONTENTS any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.0 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to emerging growth company shall have the meaning associated with such term in the JOBS Act. TABLE OF CONTENTS The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 22 of this prospectus. Securities offered 30,000,000 units, at $10.00 per unit, each unit consisting of: one share of common stock; and one-half of one warrant. Proposed NASDAQ symbols Units: AUMAU Common Stock: AUMA Warrants: AUMAW Trading commencement and separation of common stock and warrants The units will begin trading on or promptly after the date of this prospectus. The common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Citigroup Global Markets Inc. informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component pieces. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Separate trading of the common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. TABLE OF CONTENTS Units: Number outstanding before this offering 0 Number outstanding after this offering 30,000,000(1) Common stock: Number outstanding before this offering 8,625,000(2) Number outstanding after this offering 37,500,000(1) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 7,750,000(1) Number of warrants to be outstanding after this offering and the private placement 22,750,000(1) Exercisability Each whole warrant is exercisable to purchase one share of our common stock and only whole warrants are exercisable. A holder of our public warrants will not be able to exercise any one-half of one warrant unless it is combined with another one-half of one warrant. Exercise price $11.50 per share, subject to adjustments as described herein. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, and 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are not registering the shares of common stock issuable upon exercise of the warrants at this time. However, we have agreed to use our best efforts to file and have an effective registration statement covering the shares of common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of common stock until the warrants expire or are redeemed; provided, that if our common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our initial stockholders of 1,125,000 founder shares. (2) Includes up to 1,125,000 shares that are subject to forfeiture by our initial stockholders depending on the extent to which the underwriters over-allotment option is exercised. TABLE OF CONTENTS exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our common stock equals or exceeds $24.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average TABLE OF CONTENTS reported last sale price of the common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section entitled Description of Securities Warrants Public Stockholders Warrants for additional information. None of the private placement warrants will be redeemable by us so long as they are held by the initial purchasers of the private placement warrants or their permitted transferees. Founder shares On August 1, 2014, our sponsor purchased an aggregate of 8,625,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.003 per share. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible, and therefore was deemed to have no pre-investment value. Accordingly, the purchase price per share of the founder shares was equal to the amount of cash contributed to the company divided by the number of founder shares issued. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering. As such, our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). Prior to the completion of this offering, our sponsor intends to sell 25,000 founder shares at their original purchase price to each of our independent director nominees. If we increase or decrease the size of the offering pursuant to Rule 462(b) under the Securities Act, we will effect a stock dividend or share contribution back to capital, as applicable, immediately prior to the consummation of the offering in such amount as to maintain the number of founder shares at 20% of our issued and outstanding shares of our common stock upon the consummation of this offering. Up to 1,125,000 founder shares will be subject to forfeiture by our initial stockholders (or their permitted transferees) on a pro rata basis depending on the extent to which the underwriters over-allotment option is exercised. The founder shares are identical to the shares of common stock included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below, and our initial stockholders have entered into letter agreements with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to TABLE OF CONTENTS complete our initial business combination within 24 months from the closing of this offering although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our business combination within the prescribed time frame. If we submit our initial business combination to our public stockholders for a vote, our initial stockholders have agreed to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. Transfer restrictions on founder shares On the date of this prospectus, the founder shares will be placed into an escrow account maintained in New York, New York by Continental Stock Transfer & Trust Company, acting as escrow agent. Subject to certain limited exceptions discussed elsewhere in this prospectus, these shares will not be transferred, assigned or sold until released from escrow on the date that is one year after the date of the consummation of our initial business combination or earlier if, subsequent to our business combination, (i) the last sale price of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (ii) we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. We refer to such transfer restrictions throughout this prospectus as the lock-up. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 7,750,000 private placement warrants (or 8,650,000 if the over-allotment option is exercised in full), each exercisable to purchase one share of our common stock at $11.50 per share, at a price of $1.00 per warrant ($7,750,000 in the aggregate or $8,650,000 in the aggregate if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each private placement warrant is exercisable for one share of our common stock. We determined the purchase price for the private placement warrants by analyzing warrant trading prices of several comparable blank check companies that have not yet announced a business combination, all of which were substantially lower than $1.00 per warrant. We decided to sell the private placement warrants for $1.00 per warrant in order to cause fewer warrants to be issued than if the private placement warrants were issued for less than $1.00 per warrant, thereby resulting in less potential dilution. The purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the TABLE OF CONTENTS trust account. If we do not complete our initial business combination within 24 months from the closing of this offering, the proceeds of the sale of the private placement warrants will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants will expire worthless. The private placement warrants will be non-redeemable so long as they are held by their initial purchasers or their permitted transferees (except as described below under Principal Stockholders Escrow of Founder Shares and Private Placement Warrants and Transfer Restrictions ). If the private placement warrants are held by holders other than their initial purchasers or their permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Transfer restrictions on private placement warrants The private placement warrants (including the common stock issuable upon exercise of the private placement warrants) will be placed into an escrow account with Continental Stock Transfer & Trust Company. Subject to certain limited exceptions elsewhere in this prospectus, the private placement warrants will not be transferable, assignable or saleable until released from escrow on the date that is 30 days after the completion of our initial business combination. The private placement warrants will be non-redeemable so long as they are held by the initial purchasers of the private placement warrants or their permitted transferees. Cashless exercise of private placement warrants The private placement warrants are exercisable for cash or, so long as they are held by our initial stockholders and permitted transferees, on a cashless basis. If holders of private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by our initial stockholders and permitted transferees is because it is not known at this time whether they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that prohibit insiders from selling our TABLE OF CONTENTS securities except during specific periods of time. Even during such periods of time when insiders will be permitted to sell our securities, an insider cannot trade in our securities if he or she is in possession of material non-public information. Accordingly, unlike public stockholders who could sell the shares of common stock freely in the open market, the insiders could be significantly restricted from selling such securities. As a result, we believe that allowing the holders to exercise such warrants on a cashless basis is appropriate. Proceeds to be held in trust account Of the net proceeds of this offering and sale of the private placement warrants, $300,000,000, or $10.00 per unit ($345,000,000, or $10.00 per unit, if the underwriters over-allotment option is exercised in full) will be placed into a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee. These proceeds include approximately up to $10,500,000 (or approximately up to $12,075,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions and other fees. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our franchise and income tax obligations, the proceeds from this offering will not be released from the trust account until the earliest of (a) the completion of our initial business combination, (b) a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering, and then only in connection with those shares of our common stock that such stockholder properly elected to redeem, and (c) the redemption of our public shares if we are unable to complete our business combination within 24 months from the closing of this offering subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Except as described above, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. Based upon current interest rates, we expect the trust account to generate approximately $30,000 of interest annually. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering not held in the trust account, which will be approximately $1,000,000 in working capital after the payment of approximately $750,000 in expenses relating to this offering; and TABLE OF CONTENTS any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of a business combination. Conditions to completing our initial business combination There is no limitation on our ability to raise funds through the issuance of equity or debt in connection with our initial business combination, except that we will not issue any additional shares of our capital stock that would entitle the holders thereof to receive funds from the trust account or vote on our initial business combination. Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of our assets held in the trust account (excluding the deferred underwriting commissions, advisory fees and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking or accounting firm that is a member of FINRA. We will complete our initial business combination only if the post-transaction company in which our public stockholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination in our proxy solicitation materials or tender offer documents, as applicable. TABLE OF CONTENTS Permitted purchases of public shares by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our initial stockholders, directors, executive officers, advisors or their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended, or the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Redemption rights for public stockholders upon completion of our initial business combination We will provide our stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters or the advisory fees we will pay to RCS. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our initial stockholders have entered into letter agreements with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares they may acquire during or after this offering in connection with the completion of our business combination. Manner of conducting redemptions We will provide our stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the TABLE OF CONTENTS business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval by law or stock exchange listing requirements. Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. TABLE OF CONTENTS If, however, stockholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain stockholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the business combination. In such case, our initial stockholders have agreed to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. Each public stockholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed business combination, provided that a public stockholder must in fact vote for or against a proposed business combination in order to have his, her or its shares of common stock redeemed. We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either (a) tender their certificates to our transfer agent or (b) deliver their shares to the transfer agent electronically, in each case prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve the business combination in the event we distribute proxy materials. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed business combination is not approved and we continue to search for a target company, we will promptly return any certificates delivered, or shares tendered electronically, by public stockholders who elected to redeem their shares. TABLE OF CONTENTS Our amended and restated certificate of incorporation provides that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all shares of common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all shares of common stock submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of stockholders holding 20% or more of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 20% of the shares sold in this offering. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 20% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 20% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our business combination, particularly in connection with a business combination with a target that TABLE OF CONTENTS requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 20% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us. We will use these funds to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination, to pay the underwriters their deferred underwriting commissions, to pay advisory fees to RCS, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using stock or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, executive officers, directors and director nominees have agreed that we will have only 24 months from the closing of this offering to complete our initial business combination. If we are unable to complete our initial business combination within such 24-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each TABLE OF CONTENTS case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our business combination within the 24-month time period. Our initial stockholders have entered into letter agreements with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 24 months from the closing of this offering. However, if our initial stockholders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 24-month time frame. The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within 24 months from the closing of this offering. RCS will not be entitled to receive its advisory fee in the event we do not complete our initial business combination within 24 months from the closing of this offering. Our sponsor, executive officers, directors and director nominees have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes, divided by the number of then outstanding public shares. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we are not subject to the SEC s penny stock rules). Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made to our sponsor, officers or directors, or our or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination: TABLE OF CONTENTS Repayment of up to an aggregate of $200,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to an entity under common control with our sponsor of $10,000 per month for office space, utilities, secretarial support and administrative services; Payment to RCS, an entity under common control with our sponsor, of an amount equal to 1.1% of the total gross proceeds raised in this offering for financial advisory services rendered to us in connection with our identification, negotiation and consummation of a business combination; Reimbursement to our sponsor for a portion of the compensation paid to its personnel, including certain of our officers, who work on our behalf, in an amount not to exceed $15,000 per month; Reimbursement to RCS, an entity under common control with our sponsor, for any reasonable out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit Committee Prior to the consummation of this offering, we will establish an audit committee composed entirely of independent directors to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. TABLE OF CONTENTS Risks We are a newly formed company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section entitled Risk Factors beginning on page 22 of this prospectus. Summary Financial Data The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. August 1, 2014 Actual As Adjusted Balance Sheet Data: Working capital $ 9,677 $ 290,384,001 Total assets $ 230,378 $ 300,884,001 Total liabilities $ 220,701 $ 10,500,000 Value of common stock that may be redeemed in connection with our initial business combination ($10.00 per share) $ $ 285,383,991 Stockholders equity 1 $ 9,677 $ 5,000,010 (1) Excludes shares subject to redemption in connection with our initial business combination. The as adjusted information gives effect to the filing of our amended and restated certificate of incorporation, the sale of 30,000,000 units in this offering for $10.00 per unit, the sale of 7,750,000 private placement warrants for $1.00 per warrant, repayment of up to an aggregate of $200,000 in loans made to us by our sponsor and the payment of the estimated expenses of this offering. The as adjusted total assets amount includes the $300,000,000 held in the trust account ($345,000,000 if the underwriter s over-allotment option is exercised in full) for the benefit of our public stockholders, which amount, less deferred underwriting commissions and advisory fees payable to RCS, will be available to us only upon the completion of our initial business combination within 24 months from the closing of this offering. The as adjusted total assets include up to $10,500,000 being held in the trust account (up to approximately $12,075,000 if the underwriters over-allotment option is exercised in full) representing deferred underwriting commissions and advisory fees payable to RCS. The deferred underwriting commissions and advisory fees payable to RCS are netted out of the working capital. If no business combination is completed within 24 months from the closing of this offering, the proceeds then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), will be used to fund the redemption of our public shares. Our initial stockholders have entered into letter agreements with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within such 24-month time period. TABLE OF CONTENTS
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in the common stock. You should carefully read the entire prospectus, including Risk Factors , Management s Discussion and Analysis of Financial Condition and Results of Operations and the Financial Statements, before making an investment decision. In this Prospectus, the terms Periya, Company, we, us and our refer to Periya Corp. Corporate Background Periya Corp. ( Periya ) was incorporated on December 20, 2013 under the laws of the State of Nevada as a development stage company. The Company plans to develop and market software products as a mobile application for end users of the current generation of Blackberry mobile phones. We plan to sell our initial applications through Blackberry World Store or through our own online retail website to individual customers. As of the date of this prospectus, neither our initial mobile application nor any other application has been developed to the point that we can describe specifically its nature or its scope. We anticipate that we will receive revenue from the sale of our software products. Specifically, customers will be charged an initial fee to download our basic software product. Additional software features will be available for additional charges. Additionally, customers will be charged ongoing monthly fees for continued use of our products, software upgrades and other software modifications. As of the date of this prospectus, the amounts of the prices for our products have not been determined. As our software products are completed, we will determine the prices based upon our costs and the prices of competing products. The Offering Securities offered: 2,240,000 shares of common stock Offering price : The selling security holders purchased their shares of common stock from the Company at the price of $0.01 per share and will be offering their shares of common stock at a price of $0.01 per share, which includes an increase, based on the fact the shares will be liquid and registered. This is a fixed price at which the selling security holders may sell their shares until our common stock is quoted on the OTC Bulletin Board, at which time the shares may be sold at prevailing market prices or privately negotiated prices. Shares outstanding prior to offering: 12,190,000 shares of common stock. Shares outstanding after offering: 12,190,000 shares of common stock. Our sole executive officer and directors currently own 82% of our outstanding common stock. As a result, he has substantial control over all matters submitted to our stockholders for approval. Market for the common shares: There is currently no trading market for our common stock. We intend to apply for quotation on the OTC Bulletin Board. We will require the assistance of a market-maker to apply for quotation. There is no assurance that a trading market will develop, or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale. Use of proceeds: We will not receive any proceeds from the sale of shares by the selling security holders. SUMMARY FINANCIAL DATA The following summary financial data should be read in conjunction with Management s Discussion and Analysis or Plan of Operation and the Financial Statements and Notes thereto, included elsewhere in this prospectus. The statement of operations data and balance sheet data for the three months ended June 30, 2014 and the period from Inception (December 20, 2013) to March 31, 2014 are from our audited financial statements. From the Three Months Ended June 30, 2014 From Inception to the Year Ended March 31, 2014 (unaudited) (audited) STATEMENT OF OPERATIONS Revenues - - Total Operating Expenses 4,800 10,489 Net (Loss)/Income (4,800 ) (10,489 ) June 30, 2014 March 31, 2014 (unaudited) (audited) BALANCE SHEET DATA Cash $ 1,611 $ 3,211 Prepaid expense - 1,800 Total Assets 1,611 5,011 Common stock 12,190 12,050 Additional paid-in capital 4,710 3,450 Deficit accumulated during the development stage (15,289 ) (10,489 ) Stockholders Equity 1,611 5,011
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001617227_j_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001617227_j_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001617291_mb_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001617291_mb_prospectus_summary.txt
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+S-1/A 1 t1402094-s1a.htm PRE-EFFECTIVE AMENDMENT NO. 2 TO FORM S-1 TABLE OF CONTENTS As filed with the Securities and Exchange Commission on November 7, 2014 Registration No. 333-198700 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 PRE-EFFECTIVE AMENDMENT NO. 2 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 MB Bancorp, Inc. Madison Bank of Maryland 401(k) Profit Sharing Plan (Exact name of registrant as specified in its charter) Maryland 6035 47-1696350 State or other jurisdiction of incorporation or organization (Primary Standard Industrial Classification Code Number) (IRS Employer Identification Number) 1920 Rock Spring Road Forest Hill, Maryland 21050 (410) 420-9600 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Julia A. Newton President and Chief Executive Officer MB Bancorp, Inc. 1920 Rock Spring Road Forest Hill, Maryland 21050 (410) 420-9600 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Gary R. Bronstein, Esq. Joel E. Rappoport, Esq. Kilpatrick Townsend & Stockton LLP 607 14 th Street, NW, Suite 900 Washington, DC 20005 (202) 508-5820 John F. Breyer, Jr., Esq. Breyer & Associates, PC 8180 Greensboro Drive, Suite 785 McLean, Virginia 22102 (703) 883-1100 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one) Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Calculation of Registration Fee Title of each class of securities to be registered Amount to be registered Proposed maximum offering price per unit Proposed maximum Aggregate offering price (1) Amount of registration fee Common Stock, $0.01 par value 2,116,000 shares $ 10.00 $ 21,160,000 $ 2,459 (2) Participation interests (3) $ 10.00 (4) (4) (1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act. (2) A filing fee of $3,067 was previously paid with the initial filing of the Form S-1 Registration Statement on September 12, 2014. (3) In addition, pursuant to Rule 416(c) under the Securities Act, this registration statement also covers an indeterminate amount of interests to be offered or sold pursuant to the employee benefit plan described herein. (4) The securities of MB Bancorp, Inc. to be purchased by the Madison Bank of Maryland Employee Savings and Stock Ownership Plan are included in the common stock. Accordingly, no separate fee is required for the participation interests pursuant to Rule 457(h)(2) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), may determine. TABLE OF CONTENTS TABLE OF CONTENTS Page Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001617326_smart_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001617326_smart_prospectus_summary.txt
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+This summary provides a brief overview of information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before investing in our common units. You should read the entire prospectus carefully, including the historical and pro forma financial statements and the notes to those financial statements included in this prospectus. Unless indicated otherwise, the information presented in this prospectus assumes an initial public offering price of $ per common unit (the midpoint of the price range set forth on the cover page of this prospectus) and that the underwriters do not exercise their option to purchase additional common units. You should read Risk Factors for more information about important risks that you should consider carefully before buying our common units. Unless the context otherwise requires, references in this prospectus to Smart Sand Partners LP, our partnership, we, our and us, or like terms, when used in an historical context, refer to Smart Sand, Inc., our predecessor for accounting purposes, and its subsidiaries, and when used in the present tense or prospectively, refer to Smart Sand Partners LP and its subsidiaries. References to our general partner refer to Smart Sand GP LLC, our general partner. References to our sponsor refer to Smart Sand Holdings LLC and its subsidiaries (including Smart Sand, Inc.) other than us, our general partner and our subsidiaries. We have provided definitions for some of the terms we use to describe our business and industry and other terms used in this prospectus in the Glossary of Terms beginning on page B-1 of this prospectus.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001618930_mp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001618930_mp_prospectus_summary.txt
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+PROSPECTUS SUMMARY THE FOLLOWING SUMMARY IS NOT COMPLETE AND DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK. As used in this prospectus, references to the "Company," "we," "our", "us" or "MP" refer to MP Ventures, Inc. unless the context otherwise indicated. You should carefully read all information in the prospectus, including the financial statements and their explanatory notes, under the Financial Statements prior to making an investment decision. Our Company Organization:The registrant was incorporated in the State of Nevada on April 14, 2014. Our principal executive offices are located at 310 Olive St., Long Beach, New York. Our telephone number is (516) 247-1917 Management:Our Chief Executive Officer is Mr. Mark Poretsky. Mr. Poretsky represents our lone employee. Plan of Operations:The registrant will seek to provide property management services to the owners of distressed real estate assets, including pre-foreclosure residential real properties, real estate owned "REO" residential properties and property tax liens on residential real properties. Service OfferingsOur specific service offerings are grouped in three distinct areas: (a) Tenant management services including advertising properties for rent, showing properties to prospective tenants, conducting background checks on prospective tenants, preparing lease agreements, collecting rents, enforcing lease provisions and responding to tenant communications; (b) property management services including providing for building inspections, repairs, maintenance; and (c) real estate investment management including providing property valuations, identifying attractive distressed property acquisition opportunities and assisting with real estate closings. We will rely on our Chief Executive Officer to provide services with regards to tenant management and real estate investment management services. We will rely on qualified third party subcontractors to provide for our property management service offering. Target Markets:Our initial target markets will be the metro New York City and Chicago markets. We will seek to expand into other markets as we begin identify attractive opportunities. Historical Operations:In anticipation of launching our business, our Chief Executive Officer has been researching various distressed real estate assets and then seeking to communicate with the owners of such properties in an effort to market our property management services to them. The Company believes that such efforts will lead to the acquisition of clients from which the company can generate revenue. Current Operations:Since inception, our Chief Executive Officer has been meeting researching and monitoring various real estate foreclosure auctions as well as property tax lien and property tax certificate auctions. Moreover, he has researched and investigated various residential real properties that are pre-foreclosure or REO by communicating with property owners as well as mortgage lending financial institutions. Going Concern:Our independent auditor has expressed substantial doubt about our ability to continue as a going concern given our lack of operating history and the fact to date have had no significant revenues. Potential investors should be aware that there are difficulties associated with being a new venture, and the high rate of failure associated with this fact. We have an accumulated deficit of ($5,826.00) at and have had no significant revenues to date. Our future is dependent upon our ability to obtain financing and upon future profitable operations from our operations. These factors raise substantial doubt that we will be able to continue as a going concern. The registrant has no present plans to be acquired or to merge with another company nor does the registrant, or any of its shareholders, have any plans to enter into a change of control or similar transaction. Moreover, we are not a blank check company. Rule 419 of Regulation C under the Securities Act of 1933 defines a "blank check company" as a (i) development stage company that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person, and (ii) is issuing a penny stock. Accordingly, we do not believe that our Company may be classified as a "blank check company" because we intend to engage in a specific business plan and do not intend to engage in any merger or acquisition with an unidentified company or other entity. The Offering Type of Securities Offered: Common Stock. Common Shares Being Sold In this Offering: Two Million (2,000,000). Offering Price: The Registrant will offer its common shares at $.10 per share. Common Shares Outstanding Before the Offering: Five Million (5,000,000). Termination of the Offering: The offering will commence of the effective date of this prospectus and will terminate on or before ___________. Market for our Common Stock:There is presently no public market for our common shares. We anticipate applying for quoting of our common shares on the OTC Bulletin Board or OTCQB upon the effectiveness of the registration statement of which this prospectus forms a part. There can be no assurance that a market maker will agree to file the necessary documents with the Financial Industry Regulatory Authority, which operates the OTCBB and OTCQB, nor can there be any assurance that such application for quotation will be approved. Common Stock Control:Mark Poretsky, our Chief Executive Officer and only director, currently owns all the issued and outstanding common stock of the company, and will continue to own sufficient common shares to control the operations of the company after this offering, irrespective of its outcome. Penny Stock Regulation:The liquidity of our common stock is restricted as the registrant s common stock falls within the definition of a penny stock. These requirements may restrict the ability of broker/dealers to sell the registrant's common stock, and may affect the ability to resell the registrant's common stock. Emerging Growth Company We are an emerging growth company under the JOBS Act. We shall continue to be deemed an emerging growth company until the earliest of: 1. The last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; 2. The last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective IPO registration statement; 3. The date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or 4. The date on which such issuer is deemed to be a , ' ': large accelerated filer , as defined in section 240.12b-2 of title 46, Code of Federal Regulations, or any successor thereto. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards. We have elected to take advantage of the extended transition period for complying with new or revised accounting standards, available to Emerging Growth Companies. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the Jobs Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. Summary Financial Information Because this is only a financial summary, it does not contain all the financial information that may be important to you. Therefore, you should carefully read all the information in this prospectus, including the financial statements and their explanatory notes before making an investment decision. MP VENTURES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF OPERATIONS For the period April 14, 2014 (Inception)to July 31, 2014 (Audited) Revenues $ 2,000 Operating Expenses 7,826 Net Income(Loss) from Operations (5,826) Other Income(Expenses) Interest Expense 0 Net Income(Loss) from Operations Before Income Taxes (5,826) Tax Expense 0 Net Income(Loss) $ (5,826) Basic and Diluted Loss Per Share (0.001) Weighted average number of shares outstanding 5,000,000
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001619409_pantop_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001619409_pantop_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..4b54b9c5fec45e8ab056849985387f747fa0ac75
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+Summary PANTOP CORPORATION The Company We were incorporated as Pantop Corporation on May 6, 2014 in the State of Nevada for the purpose of designing and selling of Hermetically Sealed Microelectronic Packages, using both Glass-To-Metal-Seal and High Temperature Cofired Ceramic (HTCC) technology. Within the main business unit Hermetic Sealed Microelectronic Package, Pantop Corporation intends to develop a complete customer interface, engineering and production capability to address opportunities for its product lines across Optical Communication, Telecommunication, and Industrial markets. We are a development stage company and have not generated any revenues to date. Our business will likely fail unless we achieve sales revenue sufficient to fund ongoing operations by the mid-point of the third quarter of the fiscal year that began on June 30, 2014. We are not a "blank check" company and have no plans to engage in a merger or acquisition with any other company or other entity. We have no plans to acquire any other business and we have no intention of using investor funds or any other resources for that purpose. We plan to conduct the business disclosed herein and intend to use the proceeds from this offering in furtherance of our Hermetically Sealed Microelectronic Packages business as disclosed in more detail under the heading labeled "Use of Proceeds." As of September 30, 2014, we had $7,116 in current assets and $6,919 in current liabilities. Accordingly, we had working capital of $197 as of September 30, 2014. Our current working capital is not sufficient to enable us to implement our business plan as set forth in this prospectus. We currently do not have any arrangements for financing and we may not be able to obtain financing when required. For these and other reasons, our independent auditors have raised substantial doubt about our ability to continue as a going concern. Accordingly, we will require additional financing, including the equity funding sought in this prospectus. We are offering for sale to investors a maximum of 5,000,000 shares of our common stock at an offering price of $0.02 per share (the "Offering"). Our business plan is to use the proceeds of this offering for engineer consultancy cost and the order of certain materials, outsourcing manufacturing to downstream factories, and marketing through website, local exhibitions and by other means. The shares are being offered by us on a "best efforts" basis and there can be no assurance that all or any of the shares offered will be subscribed. If less than the maximum proceeds are available to us, our development and prospects could be adversely affected. There is no minimum offering required for this offering to close. The proceeds of this offering will be immediately available to us for our general business purposes. The Maximum Offering amount is 5,000,000 shares ($100,000). Our principal office address is Suite 3906, Far East Finance Centre, 16 Harcourt Road, Admiralty, Hong Kong. Our phone number is +852 5325 5932 and the to-be-developed website is www.pantopcorp.com. And our fiscal year end is June 30. Implications of Being an Emerging Growth Company We qualify as an emerging growth company as that term is used in the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include: 1.A requirement to have only two years of audited financial statements and only two years of related MD 2.Exemption from the auditor attestation requirement in the assessment of the emerging growth company s internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002; 3.Reduced disclosure about the emerging growth company s executive compensation arrangements; and 4.No non-binding advisory votes on executive compensation or golden parachute arrangements. We have already taken advantage of these reduced reporting burdens in this prospectus, which are also available to us as a smaller reporting company as defined under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities Act") for complying with new or revised accounting standards. We have elected to use the extended transition period provided above and therefore our financial statements may not be comparable to companies that comply with public company effective dates. We could remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. For more details regarding this exemption, see "Financial Statements from Page F1 to F16." The Offering Securities Being Offered Up to 5,000,000 shares of our common stock. Offering Price The offering price of the common stock is $0.02 per share. There is no public market for our common stock. We cannot give any assurance that the shares offered will have a market value, or that they can be resold at the offered price if and when an active secondary market might develop, or that a public market for our securities may be sustained even if developed. The absence of a public market for our stock will make it difficult to sell your shares in our stock. Upon the effectiveness of the registration statement of which this prospectus is a part, we intend to apply through FINRA to the over-the-counter bulletin board, through a market maker that is a licensed broker dealer, to allow the trading of our common stock upon our becoming a reporting entity under the Securities Exchange Act of 1934. Minimum Number of Shares To Be Sold in This Offering N/A Maximum Number of Shares To Be Sold in This Offering 5,000,000 Securities Issued and to be Issued 12,000,000 shares of our common stock are issued and outstanding as of the date of this prospectus. Our sole Officer and Director, Ms. Lijuan Hao, owns an aggregate of 83.33% of the common shares of our company and therefore have substantial control; Grenfell Capital Limited owns 16.67% of the common shares before new issuance. Upon the completion of this offering, our sole Director and Officer and Grenfell Capital Limited will own an aggregate of approximately 58.82% and 11.76%, respectively, of the issued and outstanding shares of our common stock if the maximum number of shares is sold. Number of Shares Outstanding After The Offering If All The Shares Are Sold 17,000,000 Use of Proceeds If we are successful at selling all the shares we are offering, our proceeds from this offering will be approximately $100,000. We intend to use these proceeds to execute our business plan as set out in Use of Proceeds section on pages 13-14 of this Prospectus. Offering Period The shares are being offered for a period up to 120 days after the date of this Prospectus, unless extended by us for an additional 90 days. The following selected financial data should be read in conjunction with our financial statements and the related notes to those statements included in "Financial Statements" and with " Management s Discussion and Analysis of Financial Condition And Results Of Operations" appearing elsewhere in this Prospectus. Summary Financial Information for the year ended June 30, 2014 September 30, June 30, 2014 2014 $ $ Balance Sheet Data Cash and cash equivalents 3,901 3,901 Deposit 2,500 2,500 Prepayments 715 1,165 Total Current Assets 7,116 7,566 Total Current Liabilities (6,919) (5,059) Total Stockholder s Equity 197 2,507 Three Months Ended September 30, Period from May 6, 2014 (inception) to June 30, 2014 2014 $ $ Statement of Operations Revenue - - Net Profit (Loss) for Reporting Period (2,310) (9,493) Risk Factors You should consider each of the following risk factors and any other information set forth herein, including our financial statements and related notes, in evaluating our business and prospects. The risks and uncertainties described below are not the only ones that impact on our operations and business. Additional risks and uncertainties not presently known to us, or that we currently consider immaterial, may also impair our business or operations. If any of the following risks actually occur, our business and financial results or prospects could be harmed. In that case, the value of the Common Stock could decline. Risks Related To Our Financial Condition and Business If we do not obtain additional financing, including the financing sought in this offering, our business will fail. We have not yet commenced active operations and have not generated any revenue to date. Our business plan calls for expenses related to the acquisition of certain materials and equipment, engineering consultancy and marketing throughout local industrial exhibitions and electronic fairs, probably professional manufacturing procedure consultation, and other start-up costs. Our the most ideal cash requirements over the next coming twelve months are expected to be approximately $100,000, major expense consisting of approximately for $10,500 on professional fee for this Offering, consisting of approximately $49,000 for order material for outsourcing manufacturing, $14,000 for marketing, $24,000 for Engineering consultation specialized in manufacturing procedure management and control, and the rest for administrative and web development expenses. As of September 30, 2014, we had cash on hand in the amount of $3,901 and working capital in the amount of $197. Accordingly, our business will likely fail if we are unable to successfully complete this Offering at or near the maximum offering amount. In addition, if we are unable to achieve sales revenue sufficient to fund ongoing operations by the mid-point of the third quarter of our fiscal year beginning June 30, 2014, we will be required to seek additional financing. We currently do not have any arrangements for financing and we may not be able to obtain financing when required. Obtaining additional financing beyond the initial equity financing sought through this offering will be subject to a number of factors, including our ability to show strong early revenues and sustained sales growth. These factors may make the most desirable timing, amount, and terms or conditions of additional financing unavailable to us. Because we have limited experience marketing our services, designing customized products and working with the machinery manufacturing downstream factories, we may find it difficult to smooth the entire working system, generate significant revenue and we face a high risk of business failure. Our management has very little experience marketing our services and designing customized products for clients. We have not commenced operations in the past few months, let alone taken our first customer order, and have not yet completed any project. Our experience in marketing our products to date has consisted of informal contacts with potential purchasers and we lack a proven track record of supplying high quality products on which to rely on marketing to potential customers. Because of our very limited experience in marketing our services and monitoring downstream collaborative machinery manufacturing factories in manufacturing our self-designed products, we can provide no assurance that we will be able to successfully deliver the order, generate significant sales or net profits. We have not earned any revenues as of the date of this prospectus, and we face a high risk of business failure. We have not found a suitable and capable machinery manufacturing factories to be our downstream factories yet. We may find it difficult to manufacture products even though we successfully complete designing the engineering samples for the customers, which will seriously affect our ability to generate revenue, negatively affect our reputation, and eventually we may face a high risk of business failure. Due to our limited financial resources, our management has not started searching for the suitable and capable machinery factories to be our manufacturers. Evaluating and searching for a qualified downstream producer is time and energy consuming, to find a qualified manufacturer is essential to the success of our business. Even if the downstream producer can be found in a very short time, smooth operation between our Company and the factory will depend on knowledge and technical transfer to make the product. Furthermore, there is a possibility that the downstream factories cannot produce our designed products to our specification and standard. Because our sole Director and Officer has no prior experience as a Chief Executive or as the head of a public company, we may be hindered in our ability to efficiently and competitively execute our business strategy and achieve profitability. Our sole Director and Officer, Ms. Hao, lacks any prior experience as a company Chief Executive. In addition, Ms. Hao does not have any business experience beyond her past position as a head of Equipment & Mechanical Lubrication Department of Shenzhen Seg-HITACHI Display Devices Co. Ltd. Our competitors will likely have substantially more experienced management as well as greater revenue and resources. We believe competition in the market for our services will be based primarily on product designing innovation, price, and timely completion and high quality hermetically sealed microelectronic packages. Due to more experienced management and greater overall resources, our competitors will have a significant advantage over us and we may struggle to grow our sales effectively and achieve long term profitability. In addition, Ms. Hao has no experience managing a publicly reporting company. Accordingly, Ms. Hao will be less effective than more experienced managers in efficiently managing our ongoing regulatory compliance obligations and in dealing with such matters as public relations, investor relations, and corporate governance. Because we do not have a corps of experienced personnel, our ability to expand our operations and to grow revenues over time may be limited. We have no full time employees and will rely upon individuals working as independent consultants on an as-needed basis to assist with the manufacturing and quality control process for our orders. Our competitors may have rosters of experienced full time personnel which will enable them to expand more rapidly, handle a larger volume of business, and thereby continue to maintain their larger market shares. Accordingly, our ability to significantly expand our operations and to engage in the design and manufacturing of multiple orders at one time may be hindered during the immediate future and our prospects for growth of our revenue base may be limited. Because our auditor has issued a going concern opinion regarding our company, there is an increased risk associated with an investment in our company. We have earned no revenue since our inception, which makes it difficult to evaluate whether we will operate profitably. We have not attained profitable operations and are dependent upon obtaining financing or generating revenue from operations to continue operations for the immediate future. As of September 30, 2014, we had cash in the amount of $3,901. Our future is dependent upon our ability to obtain financing or upon future profitable operations. We are currently seeking equity financing through this offering. We reserve the right to seek additional funds through private placements of our common stock and/or through debt financing. Our ability to raise additional financing is unknown. We do not have any formal commitments or arrangements for the advancement or loan of funds. For these reasons, our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern. As a result, there is an increased risk that you could lose the entire amount of your investment in our company. Because our offering will be conducted on a best efforts basis, there can be no assurance that we can raise the money we need. The shares are being offered by us on a "best efforts" basis without benefit of a private placement agent. We can provide no assurance that this Offering will be completely sold out. If less than the maximum proceeds are available, our business plans and prospects for the current fiscal year could be adversely affected. Because our president has only agreed to provide her services on a part-time basis, he may not be able or willing to devote a sufficient amount of time to our business operations, causing our business to fail. Ms. Hao, our sole Officer and Director and the designer and primary developer of our products, devotes 10 to 15 hours per week to our business affairs. Currently, we do not have any full or part-time employees and rely upon outside consultants to assist with the performance of our projects on an as-needed basis. If the demands of our business require the full business time of Ms. Hao, it is possible that she may not be able to devote sufficient time to the management of our business, as and when needed. If our management is unable to devote a sufficient amount of time to manage our operations, our business will fail. Because our President and sole Director and Officer, Ms. Lijuan Hao, will own approximately 58.82% of our outstanding common stock, if the maximum number of shares is sold, investors may find that corporate decisions influenced by Ms. Lijuan Hao are inconsistent with the best interests of other stockholders. Ms. Lijuan Hao is our sole Director and Officer. She will own approximately 58.82% of the outstanding shares of our common stock, if the maximum number of shares is sold. Accordingly, she will have an overwhelming influence in determining the outcome of all corporate transactions or other matters, including mergers, consolidations and the sales of all or substantially all of our assets, and also the power to prevent or cause a change in control. While we have no current plans with regard with regard to any merger, consolidation or sale of substantially all of our assets, the interests of Ms. Lijuan Hao may still differ from the interests of the other stockholders. The direction Ms. Hao takes in the Company may also differ from the interests of the other stockholders. She has sole power to decide every aspect of our business, including fundamental decisions like raising money, which could dilute your ownership in our Company, spending investment funds and any future revenue, pursing business direction, deciding on what contracts to sign and other important matters These decisions may differ radically from the choices you would make as an investor in our Company. Because we will incur additional costs as the result of becoming a public company, our cash needs will increase and our ability to achieve net profitability may be delayed. Upon effectiveness of our Registration Statement for the Offering, we will become a publicly reporting company and will be required to stay current in our filings with the SEC, including, but not limited to, quarterly and annual reports, current reports on materials events, and other filings that may be required from time to time. We believe that, as a public company, our ongoing filings with the SEC will benefit shareholders in the form of greater transparency regarding our business activities and results of operations. In becoming a public company, however, we will incur additional costs in the form of audit and accounting fees and legal fees for the professional services necessary to assist us in remaining current in our reporting obligations. We expect that, during our next coming up twelve months of operations following the effectiveness of our Registration Statement, we will occur additional costs for professional fees in the approximate amount of $10,500. These additional costs will increase our cash needs and may hinder or delay our ability to achieve net profitability even after we have begun to generate revenues from sales of our products. Risks Related To the Industry and Market If the target market can not be recovered soon, our business will fail. Our target markets are the telecommunication and the industrial markets. For the telecommunication markets, it has recently experienced an exceptional crisis with a slight recovery in 2008 but still hampered by the effects of the global economic crisis of 2009. Nevertheless, the upward trend is expected to intensify over the coming years to fill the demand for more traffic transmission. For the industrial sector, this ne of our most important target market is the telecommunication, which contains a large sector of anti-collision radar ("intelligent" speed regulators). This global market has experienced an exceptional crisis in both its expansion and duration, which are currently in a down-market shift. It has slightly recovered in the recent two years, however, there is no hint of recovery sign of this market. Therefore, both the telecommunication and the industrial sector may not recover and this it may detrimentally affect the Company's to success in the business and our business may fail. PRC laws and regulations governing our businesses and the validity of certain of our contractual arrangements are uncertain. If we are found to be in violation, we could be subject to sanctions. In addition, changes in such PRC laws and regulations may materially and adversely affect our business. There are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including, but not limited to, the laws and regulations governing our business, or the enforcement and performance of cooperative arrangements with certain of our Chinese downstream manufacturers. We are considered foreign persons under PRC law. As a result, we are subject to PRC law limitations on manufacturing and trading. These laws and regulations are relatively new and may be subject to change, and their official interpretation and enforcement may involve substantial uncertainty. The effectiveness of newly enacted laws, regulations or amendments may be delayed, resulting in detrimental reliance by foreign investors. New laws and regulations that affect existing and proposed future businesses may also be applied retroactively. The PRC government has broad discretion in dealing with violations of laws and regulations, including levying fines, revoking business and other licenses and requiring actions necessary for compliance. In particular, licenses and permits issued or granted to us by relevant governmental bodies may be revoked at a later time by higher regulatory bodies. We cannot predict the effect of the interpretation of existing or new PRC laws or regulations on our businesses. We cannot assure you that our current operating structure would not be found in violation of any current or future PRC laws or regulations. As a result, we may be subject to sanctions, including fines, and could be required to restructure our operations or cease to provide certain services. Any of these or similar actions could significantly disrupt our business operations or restrict us from conducting a substantial portion of our business operations, which could materially and adversely affect our business, financial condition and results of operations. Adverse changes in economic and political policies of the PRC government could have a material adverse effect on the overall economic growth of China, which could adversely affect our business. As our hermetically sealed microelectronic packages products offered through the internet expands, we expect an increasing portion of our business operations would likely be conducted in China, including receiving orders from China since this product s mass production hasn t been taken off due to the technology barriers, most likely our collaborative downstream manufacturers will be picked in mainland China, and China telecommunication market has been booming in the resent years. Accordingly, our results of operations, financial condition and prospects are subject to a significant degree to economic, political and legal developments in China. China's economy differs from the economies of most developed countries in many respects, including the amount of government involvement, level of development, growth rate, controlling of foreign exchange and allocation of resources. While China's economy has experienced significant growth in the past 20 years, growth has been uneven across different regions and among various economic sectors of China. The PRC government has implemented various measures to encourage economic development and guide the allocation of resources. Some of these measures benefit the overall PRC economy, but may also have a negative effect on us. For example, our financial condition and results of operations may be adversely affected by governmental control over capital investments or changes in tax regulations that are applicable to us. Since early 2004, the PRC government has implemented certain measures to control the pace of economic growth. Such measures may cause a decrease in the level of economic activity in China, which in turn could adversely affect our results of operations and financial condition. Uncertainties with respect to the PRC legal system could adversely affect us. Our future collaborative downstream manufacturers will be picked in mainland China, which means we will conduct an increasing portion our business through affiliated entities based in China. Our operations in China are governed by PRC laws and regulations. These new downstream cooperative manufacturers are generally subject to laws and regulations applicable to foreign investments in China and, in particular, laws applicable to wholly foreign-owned enterprises. The PRC legal system is based on written statutes. Prior court decisions may be cited for reference but have limited precedent value. Since 1979, PRC legislation and regulations have significantly enhanced the protections afforded to various forms of foreign investments in China. However, China has not developed a fully integrated legal system and recently-enacted laws and regulations may not sufficiently cover all aspects of economic activities in China. In particular, because these laws and regulations are relatively new, and because of the limited published decisions and their non-binding nature, the interpretation and enforcement of these laws and regulations involve uncertainties. In addition, the PRC legal system is based in part on governmental policies and internal rules (some of which are not published on a timely basis or at all) that may have a retroactive effect. As a result, we may not be aware of our violation of these policies and rules until after the occurrence of the violation. In addition, any litigation in China may be protracted and result in substantial costs and diversion of resources and management attention. Risks Related To Legal Uncertainty If we are the subject of future product defect or liability suits, our business will likely fail. In the course of our planned development, we may become subject to legal actions based on a claim that our planned hermetically sealed microelectronic packages products are defective in workmanship or have caused personal or other injuries. We currently do not maintain liability insurance and we may not be able to obtain such coverage in the future or such coverage may not be adequate to cover all potential claims. Moreover, even if we are able to maintain sufficient insurance coverage in the future, any successful claim could significantly harm our business, financial condition and results of operations. If we are not granted trademark and copyright protection for our designs, we may have difficulty safeguarding our designs, potentially resulting in our competitors utilizing them, thereby impairing our ability to achieve profitable operations. Our success will depend, in part, on our ability to obtain and enforce intellectual property rights over our name and original designs in China. To date, we have sought no intellectual property rights protection. No assurance can be given that any intellectual property rights owned by us will not be challenged, invalidated or circumvented, that any rights granted will provide competitive advantages to us. Intellectual property litigation is expensive and time-consuming, and can be used by well-funded adversaries as a strategy for depleting the resources of a small company such as us. There is no assurance that we will have sufficient resources to successfully prosecute our interests in any litigation that may be brought. The failure to adequately protect our intellectual property could result in our competitors utilizing our core technology/process, and impairing our ability to achieve profitable operations. Risks Related To This Offering If a market for our common stock does not develop, shareholders may be unable to sell their shares. Prior to this offering, there has been no public market for our securities and there can be no assurance that an active trading market for the securities offered herein will develop after this offering, or, if developed, be sustained. We anticipate that, upon completion of this offering, the common stock will be eligible for quotation on the OTC Bulletin Board. If for any reason, however, our securities are not eligible for initial or continued quotation on the OTC Bulletin Board or a public trading market does not develop, purchasers of the common stock may have difficulty selling their securities should they desire to do so and purchasers of our common stock may lose their entire investment if they are unable to sell our securities. Because regulatory sales practice requirements may limit a stockholder s ability to buy and sell our stock, investors may not be able to sell their stock should they desire to do so. In addition to the "penny stock" rules described below, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may have the effect of reducing the level of trading activity in our common stock. As a result, fewer broker-dealers may be willing to make a market in our common stock, reducing a stockholder's ability to resell shares of our common stock. Because state securities laws may limit secondary trading, investors may be restricted as to the states in which they can sell the shares offered by this prospectus. If you purchase shares of our common stock sold in this offering, you may not be able to resell the shares in any state unless and until the shares of our common stock are qualified for secondary trading under the applicable securities laws of such state or there is confirmation that an exemption, such as listing in certain recognized securities manuals, is available for secondary trading in such state. There can be no assurance that we will be successful in registering or qualifying our common stock for secondary trading, or identifying an available exemption for secondary trading in our common stock in every state. If we fail to register or qualify, or to obtain or verify an exemption for the secondary trading of, our common stock in any particular state, the shares of common stock could not be offered or sold to, or purchased by, a resident of that state. In the event that a significant number of states refuse to permit secondary trading in our common stock, the market for the common stock will be limited which could drive down the market price of our common stock and reduce the liquidity of the shares of our common stock and a stockholder's ability to resell shares of our common stock at all or at current market prices, which could increase a stockholder's risk of losing some or all of his investment. Because we do not expect to pay dividends for the foreseeable future, investors seeking cash dividends should not purchase our common stock. We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future. Our payment of any future dividends will be at the discretion of our Board of Directors after taking into account various factors, including but not limited to our financial condition, operating results, cash needs, growth plans and the terms of any credit agreements that we may be a party to at the time. Accordingly, investors must rely on sales of their own common stock after price appreciation, which may never occur, as the only way to realize their investment. Investors seeking cash dividends should not purchase our common stock. Because we will be subject to the "Penny Stock" rules, the level of trading activity in our stock may be reduced. Broker-dealer practices in connection with transactions in "penny stocks" are regulated by penny stock rules adopted by the Securities and Exchange Commission. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on some national securities exchanges or quoted on NASDAQ). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and, if the broker-dealer is the sole market maker, the broker-dealer must disclose this fact and the broker-dealer s presumed control over the market, and monthly account statements showing the market value of each penny stock held in the customer s account. In addition, broker-dealers who sell these securities to persons other than established customers and "accredited investors" must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser s written agreement to the transaction. Consequently, these requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security subject to the penny stock rules, and investors in our common stock may find it difficult to sell their shares. If our shares are quoted on the over-the-counter bulletin board, we will be required to remain current in our filings with the SEC and our securities will not be eligible for quotation if we are not current in our filings with the SEC. In the event that our shares are quoted on the over-the-counter bulletin board, we will be required to remain current in our filings with the SEC in order for shares of our common stock to be eligible for quotation on the over-the-counter bulletin board. In the event that we become delinquent in our required filings with the SEC, quotation of our common stock will be terminated following a 30 day grace period if we do not make our required filing during that time. If our shares are not eligible for quotation on the over-the-counter bulletin board, investors in our common stock may find it difficult to sell their shares. Because purchasers in this offering will experience immediate and substantial dilution in the net tangible book value of the common stock, you may experience difficulty recovering the value of your investment. Purchasers of our securities in this offering will experience immediate and substantial dilution in the net tangible book value of their common stock from the initial public offering price. Dilution in net tangible book value per share represents the difference between the amount per share paid by purchasers of shares of our common stock in this offering and the pro forma net tangible book value per share of our common stock immediately following this offering. The dilution experienced by investors in this offering will result in a net tangible book value per share that is less than the offering price of $0.02 per share. Such dilution may depress the value of the company s common stock and make it more difficult to recover the value of your investment in a timely manner should you chose sell your shares. If we undertake future offerings of our common stock, purchasers in this offering will experience dilution of their ownership percentage. Generally, existing shareholders will experience dilution of their ownership percentage in the company if and when additional shares of common stock are offered and sold. In the future, we may be required to seek additional equity funding in the form of private or public offerings of our common stock. In the event that we undertake subsequent offerings of common stock, your ownership percentage, voting power as a common shareholder, and earnings per share, if any, will be proportionately diluted. This may, in turn, result in a substantial decrease in the per share value of your common stock. We are an "emerging growth company," and any decision on our part to comply only with certain reduced disclosure requirements applicable to "emerging growth companies" could make our common stock less attractive to investors. We are an "emerging growth company," as defined in the JOBS Act, and, for as long as we continue to be an "emerging growth company," we expect and fully intend to take advantage of exemptions from various reporting requirements applicable to other public companies but not to "emerging growth companies," including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We could be an "emerging growth company" for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three years period. In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to opt in to the extended transition period for complying with the revised accounting standards. We have elected to rely on these exemptions and reduced disclosure requirements applicable to "emerging growth companies" and expect to continue to do so. The JOBS ACT allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies. Since, we have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the JOBS Act, this election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. Reporting requirements under the exchange act and compliance with the SARBANES-OXLEY ACT OF 2002, including establishing and maintaining acceptable internal controls over financial reporting, are costly and may increase substantially. The rules and regulations of the SEC require a public company to prepare and file periodic reports under the Exchange Act, which will require that the Company engage legal, accounting, auditing and other professional services. The engagement of such services is costly. Additionally, the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act") requires, among other things, that we design, implement and maintain adequate internal controls and procedures over financial reporting. The costs of complying with the Sarbanes-Oxley Act and the limited technically qualified personnel we have may make it difficult for us to design, implement and maintain adequate internal controls over financial reporting. In the event that we fail to maintain an effective system of internal controls or discover material weaknesses in our internal controls, we may not be able to produce reliable financial reports or report fraud, which may harm our overall financial condition and result in loss of investor confidence and a decline in our share price. As a public company, we will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Act of 2010 and other applicable securities rules and regulations. Despite recent reforms made possible by the JOBS Act, compliance with these rules and regulations will nonetheless increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources, particularly after we are no longer an "emerging growth company." The Exchange Act requires, among other things, that we file annual, quarterly, and current reports with respect to our business and operating results. We are working with our legal, independent accounting and financial advisors to identify those areas in which changes should be made to our financial and management control systems to manage our growth and our obligations as a public company. These areas include corporate governance, corporate control, disclosure controls and procedures and financial reporting and accounting systems. We have made, and will continue to make, changes in these and other areas. However, we anticipate that the expenses that will be required in order to adequately prepare for being a public company could be material. We estimate that the aggregate cost of increased legal services; accounting and audit functions; personnel, such as a chief financial officer familiar with the obligations of public company reporting; consultants to design and implement internal controls; and financial printing alone will be a few hundred thousand dollars per year and could be several hundred thousand dollars per year. In addition, if and when we retain independent directors and/or additional members of senior management, we may incur additional expenses related to director compensation and/or premiums for directors and officers liability insurance, the costs of which we cannot estimate at this time. We may also incur additional expenses associated with investor relations and similar functions, the cost of which we also cannot estimate at this time. However, these additional expenses individually, or in the aggregate, may also be material. In addition, being a public company could make it more difficult or more costly for us to obtain certain types of insurance, including directors and officers liability insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as executive officers. The increased costs associated with operating as a public company may decrease our net income or increase our net loss, and may cause us to reduce costs in other areas of our business or increase the prices of our products or services to offset the effect of such increased costs. Additionally, if these requirements divert our management s attention from other business concerns, they could have a material adverse effect on our business, financial condition and results of operations. Forward-Looking Statements We have made statements in this Prospectus, including under "Prospectus Summary," "Risk Factors," "Management s Discussion and Analysis of Financial Condition and Results of Operations," "Description of Business" and elsewhere that constitute forward-looking statements. Forward-looking statements involve risks and uncertainties, such as statements about our plans, objectives, expectations, assumptions or future events. In some cases, you can identify forward-looking statements by terminology such as "anticipate," "estimate," "plan," "project," "potential," "predict," "continuing," "ongoing," "expect,", "we believe," "we intend," "we prepare", "may," "should," "will," "could" and similar expressions denoting uncertainty or an action that may, will or is expected to occur in the future. These statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from any future results, performances or achievements expressed or implied by the forward-looking statements. Examples of forward-looking statements include: the timing of the development of future products; projections of costs, revenue, earnings, capital structure and other financial items; statements of our plans and objectives; statements regarding the capabilities of our business operations; statements of expected future economic performance; statements regarding competition in our market; and assumptions underlying statements regarding us or our business. The ultimate correctness of these forward-looking statements depends upon a number of known and unknown risks and events. We discuss our known material risks under the heading "Risk Factors" above. Many factors could cause our actual results to differ materially from the forward-looking statements. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. The forward-looking statements speak only as of the date on which they are made, and, except as required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. You should also assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date. Use of Proceeds The net proceeds to us from the sale of up to 5,000,000 shares of common stock offered at a public offering price of $0.02 per share will vary depending upon the total number of shares sold. We are conducting this Offering on a best-effort basis. There is no minimum amount of shares we are required to sell nor is a minimum amount of money we are required to raise from this Offering. If we well all of the shares offered, we will receive $100,000 in gross proceeds, but there can be no assurance that all or any of the shares will be sold. The following table summarizes in the next page, in order of priority the anticipated application of the proceeds we will receive from this offering if 25%, 50%, 75% and 100% number of shares is sold in this offering by the Company: Business development expenses consist primarily of office expenses, marketing expenses, and acquisition of certain materials. And the compensation for personnel like engineering consultation and professional fee take a huge portion of our use of proceed. We plan to use the proceeds from this offering to introduce our designed of hermetic sealed microelectronic package products to the target mainly Telecommunications and Industrial markets. Following the raising of the necessary funds from this prospectus, we anticipate to commence marketing our services and products, select the downstream factories, and manufacturing our first engineering sample order from first customer in the next 12 month. We are unable to predict whether there will be any direct financial impact from the planned business development and there can be no assurance our product development plans will achieve any of the benefits we anticipate. If 25% of Shares are sold If 50% of Shares are sold If 75% of Shares are sold If 100% of Shares are sold Gross Proceeds from this Offering $25,000 $50,000 $75,000 $100,000 Planned Expenditures: Offering Expenses -Legal and Accounting $7,000 $7,000 $7,000 $7,000 -SEC Filing Fees $3,000 $3,000 $3,000 $3,000 -Postage/Printing $500 $500 $500 $500 Sub-total $10,500 $10,500 $10,500 $10,500 Less: Business Development -Domain Name Fee $10 $10 $10 $10 -Web Development $500 $800 $900 $1,000 -Marketing $4,936 $9,000 $11,250 $14,000 -Material $3,500 $16,800 $27,000 $49,000 Sub-total $8,946 $26,610 $39,160 $64,010 Less: Admin. Expenses -Registered Agent Fee - Nevada $129 $129 $129 $129 -Annual List Fee $325 $325 $325 $325 -Telephone/Printing/Mail/Office/Misc $100 $300 $600 $800 -Engineer Consultation $5,000 $12,000 $24,000 $24,000 -Others $0 $136 $286 $236 Sub-total $5,554 $12,890 $25,340 $25,490 Grand Expenditures $25,000 $50,000 $75,000 $100,000 Investors must be aware that the above figures represent only estimated costs. We believe our anticipated funds from this Offering and the cash we currently have, will provide us with sufficient funds to meet our cash requirements for our business operations for at least twelve months following the date of this registration statement provided that we are able to successfully complete this Offering at or near the maximum offering amount. Moreover, none of the offering proceeds we receive will be used to make loans to Directors. Our description represents our best estimate of the allocation of the proceeds of this offering based upon our start-up stage. Our estimates may prove to be inaccurate. We based this estimate on various assumptions, including our anticipated sales, marketing expenditures, and consultancy fee of professional engineers to monitor the quality control and assurance, etc. If any of these factors changes, we may find it necessary to reallocate a portion of the proceeds within the above described categories. If our plans change or our assumptions prove to be inaccurate, we may need to seek additional financing sooner than currently anticipated or to curtail our operations. Determination of Offering Price The $0.02 per share offering price of our common stock was arbitrarily chosen by management. There is no relationship between this price and our assets, earnings, book value or any other objective criteria of value. Dilution Purchasers of our securities in this offering will experience immediate and substantial dilution in the net tangible book value of their common stock from the initial public offering price. The price of the current offering is fixed at $0.02 per share. This price is significantly greater than the price paid by the Company s sole Director and Officer for common equity since the Company s inception on May 6, 2014. The Company s sole Officer and Director paid $0.001 per share, a difference of $0.199 per share lower than the sale price in this offering. The historical net tangible book value as of June 30, 2014 was $2,507 or $0.00021 per share. The following assumes the sale of 100% of the shares of common stock in this offering. After giving effect to the sale of 5,000,000 shares at an offering price of $0.02 per share of common stock, the new investors capital contributions reach to the maximum amount as $100,000, as 89.29% of the capital. Thus, the percentage of ownership after offerings reaches as high as 29.41%. Other figures as illustrated in the following table: If 100% shares are sold: Public offering price per share of common stock $ 0.02000 Net tangible book value per share prior to offering $ 0.00021 Increase per share attributable to new investors $ 0.00638 Net tangible book value per share after offering $ 0.00659 Dilution per share to new investors $ 0.01341 The following assumes the sale of 75% of the shares of common stock in this offering. After giving effect to the sale of 3,750,000 shares at an offering price of $0.02 per share of common stock, the new investors capital contributions reach to the amount as $75,000, as 86.21% of the capital. Thus, the percentage of ownership after offerings reaches as much as 23.81%. Other figures as illustrated in the following table: If 75% shares are sold: Public offering price per share of common stock $ 0.02000 Net tangible book value per share prior to offering $ 0.00021 Increase per share attributable to new investors $ 0.00531 Net tangible book value per share after offering $ 0.00552 Dilution per share to new investors $ 0.01448 The following assumes the sale of 50% of the shares of common stock in this offering. After giving effect to the sale of 2,500,000 shares at an offering price of $0.02 per share of common stock, the new investors capital contributions reach to the amount as $50,000, as 80.65% of the capital. Thus, the percentage of ownership after offerings reaches 17.24%. Other figures as illustrated in the following table: If 50% shares are sold: Public offering price per share of common stock $ 0.02000 Net tangible book value per share prior to offering $ 0.00021 Increase per share attributable to new investors $ 0.00407 Net tangible book value per share after offering $ 0.00428 Dilution per share to new investors $ 0.01572 The following assumes the sale of 25% of the shares of common stock in this offering. After giving effect to the sale of 1,250,000 shares at an offering price of $0.02 per share of common stock, the new investors capital contributions reach to the amount as $25,000, as 67.57% of the capital. Thus, the percentage of ownership after offerings reaches as 9.43%. Other figures as illustrated in the following table: If 25% shares are sold: Public offering price per share of common stock $ 0.02000 Net tangible book value per share prior to offering $ 0.00021 Increase per share attributable to new investors $ 0.00258 Net tangible book value per share after offering $ 0.00279 Dilution per share to new investors $ 0.01721 Plan
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+PROSPECTUS SUMMARY THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION AND DOES NOT CONTAIN ALL THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD CAREFULLY READ THIS PROSPECTUS, ANY RELATED PROSPECTUS SUPPLEMENT AND THE DOCUMENTS WE HAVE REFERRED YOU TO IN THE SECTION WHERE YOU CAN FIND MORE INFORMATION BEFORE MAKING AN INVESTMENT IN OUR COMMON STOCK, INCLUDING THE RISK FACTORS IN THIS PROSPECTUS, REFERENCES TO THE COMPANY, SIERRA, WE, US, OUR, REFER TO SIERRA MADRE MINING, INC. UNLESS OTHERWISE INDICATED OR THE CONTEXT OTHERWISE REQUIRES. THE COMPANY We incorporated in Delaware on November 6, 2013. We are an exploration stage mining company. Our office address is Sierra Madre Mining, Inc., 18444 N 25th Ave. Suite #420 711, Phoenix, AZ 85023. Our phone # is 480-658-3822. Our website is www.SierraMadreMining.com. Business Overview Sierra Madre Mining is a U.S.-based mining exploration company engaged in the acquisition and exploration of mineral properties. We own a 20% ownership interest in 200 lode claims located in two separate blocks of 97 claims and 103 claims, more or less contiguous, located in Mohave County, Arizona. We have a JV with the LLCs that own the remaining 80% ownership interest on these 200 lode claims. Sierra Madre has had no field operations or activity in 2013 or 2014. The company intends, with a successful offering, to use proceeds from sales of our securities to begin a drilling program on the mining claims, to determine what, if any, reserves are on the claims. We have named this particular JV the Copper Blowout Ridge JV. We also intend to be engaged in the acquisition, exploration and development of mining properties in the United States. 103 of our claims are located directly west of Meadview, Arizona, while the remaining claims are located another 10 miles further southwest from Meadview, AZ. THE OFFERING-PLAN OF DISTRIBUTION This prospectus refers to the sale of 100,000,000 shares of the Company's Class B stock. There is no minimum number of shares that must be sold by us for the offering to proceed, and we will retain the proceeds from the sale of any of the offered shares. The shares will be offered at a fixed price of $.25 per share for the duration of the offering, which will be for one year from the date of effectiveness of this prospectus. This offering is a self-underwritten offering, which means that it does not involve the participation of an underwriter to market, distribute or sell the shares offered under this prospectus. We will sell shares on a continual basis. We reasonably expect the amount of securities registered pursuant to this offering to be offered and sold within one year from this initial effective date of this registration. We are offering the shares on a "self-underwritten" best efforts basis directly through our CEO, Michael H. Brown. He is qualified pursuant to the safe harbor provision from broker-dealer registration set out in Rule 3a4-1 under the Securities and Exchange Act of 1934. He will attempt to sell the shares. This Prospectus will permit Brown to use his best efforts to market and sell this common stock directly, with no commission or other remuneration payable to him for any shares he may sell. At this time, the Company has not made any arrangements to place the funds received in an escrow or trust account, thus, the Company and its executive officers will have immediate access to such funds. This offering will terminate upon the earliest to occur of (i) the first anniversary of the effective date of the registration statement, (ii) the date on which all 100,000,000 shares registered hereunder have been sold, or (iii) the date on which we terminate this offering. In connection with his selling efforts in the offering, Mr. Brown will not register as a broker-dealer pursuant to Section 15 of the Exchange Act but rather will rely upon the "safe harbor" provisions of Rule 3a4-1 under the Exchange Act. Generally speaking, Rule 3a4-1 provides an exemption from the broker-dealer registration requirements of the Exchange Act for persons associated with an issuer that participates in an offering of the issuer's securities. Mr. Brown is not subject to any statutory disqualification, as that term is defined in Section 3(a)(39) of the Exchange Act. Mr. Brown will not be compensated in connection with his participation in the offering by the payment of commissions or other remuneration based either directly or indirectly on transactions in our securities. Mr. Brown is not and has not been within the past 12 months, a broker or dealer, and is not within the past 12 months, an associated person of a broker or dealer. At the end of the offering, Mr. Brown will continue to primarily perform substantial duties for us or on our behalf otherwise than in connection with transactions in securities. Mr. Brown has not participated in selling an offering of securities for any issuer more than once every 12 months other than in reliance on Exchange Act Rule 3a4-1(a)(4)(i) or (iii). Any investment in the shares offered herein involves a high degree of risk. You should only purchase shares if you can afford a loss of your investment. Our independent registered public accountant has issued an audit opinion for our company, which includes a statement expressing substantial doubt as to our ability to continue as a going concern. There currently is no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on the over-the-counter market. There can be no assurance that our common stock will ever be quoted on a stock exchange or a quotation service or that any market for our stock will develop. The following table shows the possible outcomes for computing the Company's outstanding stock given partial sales of the total offering given in percentage intervals. The Company has made no plans to place the proceeds of the offering in escrow or trust account. The proceeds are to be used when available. Immediate use of the proceeds when received in the Company s accounts regardless of the total received at any time during the offering has the possibility of having a negative effect on investors. Because the offering has no set minimum and there is no plan to escrow the offering proceeds, the Company may fail to raise enough capital to fund its business plan and operations and it s possible that investors may lose all or substantially all of their investment. Offering Price Per Share Commissions Proceeds to Company Before Expenses if 10% of the shares are sold Proceeds to Company Before Expenses if 50% of the shares are sold Proceeds to Company Before Expenses if 100% of the shares are sold Class B Common Stock $ .25 Not Applicable $ 2,500,000 $ 12,500,000 $ 25,000,000 Totals $ .25 Not Applicable $ 2,500,000 $ 12,500,000 $ 25,000,000 Where You Can Find Us Our office address is Sierra Madre Mining, Inc., 18444 N 25th Ave. Suite #420 711, Phoenix, AZ 85023. Our website is SierraMadreMining.com SUMMARY FINANCIAL INFORMATION We have prepared the following summary of our consolidated financial statements. The summary of our consolidated financial data set forth below should be read together with our separate audited financial statements and the notes thereto, as well as Management s Discussion and Analysis of Financial Condition and Results of Operations included in this prospectus. 9/30/14 ($) Financial Summary (Audited) Fixed Assets 50,000 Total Assets 50,000 Total Liabilities 16,515 Total Stockholder s Equity 33,485 Common Stock, $.000001 par value, 300,000,000,000 shares authorized; 127,300,000 shares issued and outstanding all classes 127 Additional Paid in Capital 62,173 Accumulated from 11/6/13 (Inception) to 9/30/14 ($) Consolidated Statements of Expenses and Comprehensive Loss Total Operating Expenses 28,815 Total Loss (28,815) EMERGING GROWTH COMPANY We are an Emerging Growth Company as defined in the Jumpstart Our Business Startups Act. We shall continue to be deemed an emerging growth company until the earliest of: a. the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; b. the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title; c. the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or d. the date on which such issuer is deemed to be a `large accelerated filer', as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto. As an emerging growth company we are exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company we are exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes. We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. SMALLER REPORTING COMPANY IMPLICATIONS OF BEING AN EMERGING GROWTH COMPANY - THE JOBS ACT We qualify as an emerging growth company as that term is used in the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include: * A requirement to have only two years of audited financial statements and only two years of related MD&A ; * Exemption from the auditor attestation requirement in the assessment of the emerging growth company's internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002; * Reduced disclosure about the emerging growth company's executive compensation arrangements; and * No non-binding advisory votes on executive compensation or golden parachute arrangements. We may take advantage of the reduced reporting requirements applicable to smaller reporting companies even if we no longer qualify as an "emerging growth company." In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities Act") for complying with new or revised accounting standards. We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. We could remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. RISK FACTORS An investment in our stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. Currently, shares of our common stock are not publicly traded. In the event that shares of our common stock become publicly traded, the trading price of our common stock could decline due to any of these risks, and you may lose all or part of your investment. In the event our common stock fails to become publicly traded you may lose all or part of your investment. We lack an Operating History The Company has a very brief operating history. During its brief operating history, the Company has not recognized any revenue from its operations. The Company has used capital provided by shareholders to provide operations capital during its brief operating history. The Company may not immediately realize any revenue from its operations unless it obtains sufficient funding for its mining activities. The Company s brief operating history and inability to yet realize any income from its efforts should be considered as a substantial risk to investors who purchase the securities of the Company. Our operations are subject to permitting requirements which could require us to delay, suspend or terminate our operations on our mining property. Our planned exploration activities on the Copper Blowout Ridge, and other properties we may acquire, require permits from the BLM, and several other governmental agencies. We may be unable to obtain these permits in a timely manner, on reasonable terms or at all. If we cannot obtain or maintain the necessary permits, or if there is a delay in receiving these permits, our timetable and business plan for exploration of the Copper Blowout Ridge will be adversely affected. Our exploration activities may not be commercially successful, which could lead us to abandon our plans to develop the property we partially own, and lose the investments proceeds from it. Our long-term success depends on our ability to identify mineral deposits on the Copper Blowout Ridge and other properties we may acquire, that we can then develop into commercially viable mining operations. Mineral exploration is highly speculative in nature, involves many risks and is frequently non-productive. These risks include unusual or unexpected geologic formations, and the inability to obtain suitable or adequate machinery, equipment or labor. The success of exploration is determined in part by the following factors: the identification of potential copper, silver, and/or gold mineralization based on evaluation of the host rock, alteration, structure, geochemistry and proper sampling; availability of government-granted operation permits; the quality of our management and our geological and technical expertise; and the capital available for exploration. Substantial expenditures are required to establish proven and probable reserves through drilling and analysis, to develop metallurgical processes to extract metal, and to develop the mining and processing facilities and infrastructure at any site chosen for mining. Whether a mineral deposit will be commercially viable depends on a number of factors, which include, without limitation, the particular attributes of the deposit, such as size, grade and proximity to infrastructure; metal prices, which fluctuate widely; and government regulations, including, without limitation, regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection. We may invest significant capital and resources in exploration activities and abandon such investments if we are unable to identify commercially exploitable mineral reserves. The decision to abandon a project may have an adverse effect on the market value of our securities and the ability to raise future financing. We cannot assure you that we will discover or acquire any mineralized material in sufficient quantities on any of our properties to justify commercial operations. Actual capital costs, operating costs, production and economic returns may differ significantly from those we have anticipated and there are no assurances that our production activities will result in profitable mining operations. Our estimated operating and capital costs for the Copper Blowout Ridge are based on information available to us and that we believe to be accurate. However, costs for labor, regulatory compliance, energy, mine and plant equipment and materials needed for production may significantly fluctuate. In light of these factors, actual costs related to our proposed budgeted production costs may exceed any estimates we may make. We do not have an operating history upon which we can base estimates of future operating costs related to Copper Blowout Ridge, and we intend to rely upon our future economic feasibility of the project and any estimates that may be contained therein. Studies derive estimates of cash operating costs based upon, among other things: anticipated tonnage, grades and metallurgical characteristics of the material to be mined and processed; anticipated recovery rates of gold and other metals from the material; cash operating costs of comparable facilities and equipment; and anticipated climatic conditions and availability of water. Capital and operating costs, production and economic returns, and other estimates contained in feasibility studies may differ significantly from actual costs, and there can be no assurance that our actual capital and operating costs will not be higher than anticipated or disclosed. A shortage of critical equipment, supplies, and resources could adversely affect our exploration activities. We are dependent on certain equipment, supplies and resources to carry out our mining exploration activities, including input commodities, drilling equipment and skilled labor. A shortage in the market for any of these factors could cause unanticipated cost increases and delays in delivery times, which could in turn adversely impact production schedules and costs. Historical production at the copper blowout ridge may not be indicative of the potential for future development. The Copper Blowout Ridge is not in commercial production, and, since acquiring ownership, we have never recorded any revenues from commercial production at those mines. You should not rely on the fact that there were historical mining operations in the surrounding mining district as an indication that we will ever have future successful commercial operations at that specific mine. In order for us to develop new mining operations we will be required to incur substantial operating expenses and capital expenditures to refurbish and/or replace existing infrastructure. We currently do not have sufficient funds to bring the Arizona into sustained commercial operation and we expect that we will require additional financing in the future. We are an exploration stage company and do not currently have sufficient capital for sustained operations. We expect that the proceeds from this offering will be used to begin drilling and geological studies on the blowout ridge. Our future financing needs may be substantial if we encounter unexpected costs or delays at this early stage of developing the mine. Failure to obtain sufficient financing through this offering may result in the delay or indefinite postponement of exploration, drilling, development or production at the Mines. Furthermore, even if we raise sufficient additional capital, there can be no assurance that we will achieve profitability or positive cash flow. In addition, any future equity offering will further dilute your equity interest in us and any future debt financing will require us to dedicate a portion of our cash flow to payments on indebtedness and will limit our flexibility in planning for or reacting to changes in our business. If the development of one or more of our mineral projects is found to be economically feasible, we will be subject to all of the risks associated with establishing new mining operations. If the development of one of our mineral projects is found to be economically feasible, such development will require obtaining permits and financing, and the construction and operation of mines, processing plants and related infrastructure. As a result, we will be subject to all of the risks associated with establishing new mining operations, including: the timing and cost, which can be considerable, of the construction of mining and processing facilities and related infrastructure; the availability and cost of skilled labor, mining equipment and principal supplies needed for operations, including explosives, fuels, chemical reagents, water, power, equipment parts and lubricants; the availability and cost of appropriate smelting and refining arrangements; the need to obtain necessary environmental and other governmental approvals and permits and the timing of the receipt of those approvals and permits; the availability of funds to finance construction and development activities; industrial accidents; mine failures, shaft failures or equipment failures; natural phenomena such as inclement weather conditions, floods, droughts, rock slides and seismic activity; unusual or unexpected geological and metallurgic conditions; exchange rate and commodity price fluctuations; high rates of inflation; potential opposition from non-governmental organizations, environmental groups or local groups, which may delay or prevent development activities; and restrictions or regulations imposed by governmental or regulatory authorities. The costs, timing and complexities of developing our projects may be greater than anticipated. Cost estimates may increase significantly as more detailed engineering work is completed on a project. It is common in mining operations to experience unexpected costs, problems and delays during construction, development and mine start-up. We cannot provide assurance that our activities will result in profitable mining operations at our mineral properties. Our operations involve significant risks and hazards inherent to the mining industry. Our exploration operations will involve the operation of large pieces of drilling and other heavy equipment. Hazards such as fire, explosion, floods, structural collapses, industrial accidents, unusual or unexpected geological conditions, ground control problems, cave-ins, flooding and mechanical equipment failure are inherent risks in our operations. Hazards inherent to the mining industry can cause injuries or death to employees, contractors or other persons at our mineral properties, severe damage to and destruction of our property, plant and equipment and mineral properties, and contamination of, or damage to, the environment, and can result in the suspension of our exploration activities and any future development and production activities. While the Company aims to maintain best safety practices as part of its culture, safety measures implemented by us may not be successful in preventing or mitigating future accidents. In addition, from time to time we may be subject to governmental investigations and claims and litigation filed on behalf of persons who are harmed while at our properties or otherwise in connection with our operations. To the extent that we are subject to personal injury or other claims or lawsuits in the future, it may not be possible to predict the ultimate outcome of these claims and lawsuits due to the nature of personal injury litigation. Similarly, if we are subject to governmental investigations or proceedings, we may incur significant penalties and fines, and enforcement actions against us could result in the closing of certain of our mining operations. If claims and lawsuits or governmental investigations or proceedings are ultimately resolved against us, it could have a material adverse effect on our financial performance, financial position and results of operations. Also, if we mine on property without the appropriate licenses and approvals, we could incur liability or our operations could be suspended. The mining industry is very competitive. The mining industry is very competitive. Much of our competition is from larger, established mining companies with greater liquidity, greater access to credit and other financial resources, newer or more efficient equipment, lower cost structures, more effective risk management policies and procedures and/or a greater ability than us to withstand losses. Our competitors may be able to respond more quickly to new laws or regulations or emerging technologies, or devote greater resources to the expansion or efficiency of their operations than we can. In addition, current and potential competitors may make strategic acquisitions or establish cooperative relationships among themselves or with third parties. Accordingly, it is possible that new competitors or alliances among current and new competitors may emerge and gain significant market share to our detriment. We may not be able to compete successfully against current and future competitors, and any failure to do so could have a material adverse effect on our business, financial condition or results of operations. The title to some of our mineral properties may be uncertain or defective, thus risking our investment in such properties. The mineral properties we own, and acquire in the future, may be subject to prior recorded and unrecorded agreements, transfers or claims, and title may be affected by, among other things, undetected defects. A title defect on any of our mineral properties (or any portion thereof) could adversely affect our ability to mine the property and/or process the minerals that we mine. Title insurance is generally not available for mineral properties and our ability to ensure that we have obtained secure claim to individual mineral properties or mining concessions may be severely constrained. We rely on title information and/or representations and warranties provided by our grantors. Any challenge to our title could result in litigation, insurance claims and potential losses, delay the exploration and development of a property and ultimately result in the loss of some or all of our interest in the property. In addition, if we mine on property without the appropriate title, we could incur liability for such activities. If we obtain insurance, it may not provide adequate coverage. Our business and operations are subject to a number of risks and hazards including, but not limited to, adverse environmental conditions, industrial accidents, labor disputes, unusual or unexpected geological conditions, ground control problems, cave-ins, changes in the regulatory environment, metallurgical and other processing problems, mechanical equipment failure, facility performance problems, fires and natural phenomena such as inclement weather conditions, floods and earthquakes. These risks could result in damage to, or destruction of, our mineral properties or production facilities, personal injury or death, environmental damage, delays in exploration, mining or processing, increased production costs, asset write downs, monetary losses and legal liability. We do not currently have insurance, although we will obtain insurance if our public offering is successful. Our property and liability insurance may not provide sufficient coverage for losses related to these or other hazards. Insurance against certain risks, including those related to environmental matters or other hazards resulting from exploration and production, is generally not available to us or to other companies within the mining industry. In addition, we do not carry business interruption insurance relating to our properties. Accordingly, delays in returning to any future production could produce near-term severe impact to our business. Any losses from these events may cause us to incur significant costs that could have a material adverse effect on our financial performance, financial position and results of operations. If we are unable to retain key members of management, our business might be harmed. Our exploration activities and any future mining and processing activities depend to a significant extent on the venture agreement with have with AJA Mining, LLC & Gold Basin Mining, LLC, and our continued service and performance of our Chief Executive Officer. Departures by any of our Directors or management could have a negative impact on our business, as we may not be able to find suitable personnel to replace departing management on a timely basis. The loss of any member of our senior management team could impair our ability to execute our business plan and could therefore have a material adverse effect on our business, results of operations and financial condition. In addition, the international mining industry is very active and we are facing increased competition for personnel in all disciplines and areas of operation. There is no assurance that we will be able to attract and retain personnel to sufficiently staff our development and operating teams. Changes in the market price of gold, silver and other metals, which in the past has fluctuated widely, will affect the profitability of our operations and financial condition. Our profitability and long-term viability depend, in large part, upon the market price of gold, copper, silver and other metals and minerals produced from our mineral properties. The market price of gold and other metals is volatile and is impacted by numerous factors beyond our control, including: sales by central banks and other holders, speculators and producers of gold and other metals in response to any of the below factors. the relative strength of the U.S. dollar and certain other currencies; interest rates; global or regional political, financial, or economic conditions; supply and demand for jewelry and industrial products containing metals; and expectations with respect to the rate of inflation; A material decrease in the market price of gold and other metals could affect the commercial viability of our properties and our anticipated development and production assumptions. Lower gold prices could also adversely affect our ability to finance future development at all of our mining properties, all of which would have a material adverse effect on our financial condition and results of operations. There can be no assurance that the market price of gold and other metals will remain at current levels or that such prices will improve. We will be required to locate mineral reserves for our long-term success. Because mines have limited lives based on proven and probable mineral reserves, we will have to continually replace and expand our mineral reserves, if any, when the Copper Blowout Ridge produces copper, gold and other base or precious metals. Our ability to maintain or increase the property s annual production of copper or other base or precious metals will be dependent almost entirely on our ability to bring new mines into production. Legislation, including the Sarbanes-Oxley Act of 2002, may make it difficult for us to retain or attract officers and directors. We may be unable to attract and retain qualified officers, directors and members of board committees required to provide for our effective management as a result of rules and regulations which govern publicly-held companies. Sarbanes-Oxley Act of 2002 has resulted in a series of rules and regulations by the SEC that increase responsibilities and liabilities of directors and executive officers. We are a small company with a very limited operating history, which may influence the decisions of potential candidates we may recruit as directors or officers. The perceived increased personal risk associated with these recent changes may deter qualified individuals from accepting these roles. We may fail to identify attractive acquisition candidates or joint ventures or may fail to successfully integrate acquired mineral properties or successfully manage joint ventures. As part of our business strategy, we may acquire additional mineral properties or enter into joint ventures. However, there can be no assurance that we will be able to identify attractive acquisition or joint venture candidates in the future or that we will succeed at effectively managing their integration or operation. In particular, significant and increasing competition exists for mineral acquisition opportunities throughout the world. We face strong competition from other mining companies in connection with the acquisition of properties producing, or capable of producing, metals as well as in entering into joint ventures with other parties. If the expected synergies from such transactions do not materialize or if we fail to integrate them successfully into our existing business or operate them successfully with our joint venture partners, or if there are unexpected liabilities, our results of operations could be adversely affected. In connection with any future acquisitions or joint ventures, we may incur indebtedness or issue equity securities, resulting in increased interest expense or dilution of the percentage ownership of existing stockholders. Unprofitable acquisitions or joint ventures, or additional indebtedness or issuances of securities in connection with such acquisitions or joint ventures, may adversely affect the price of our common stock and negatively affect our results of operations. We may be subject to claims and legal proceedings that could materially adversely impact our financial position, financial performance and results of operations. We may be subject to claims or legal proceedings covering a wide range of matters that arise in the ordinary course of business activities. These matters may result in litigation or unfavorable resolution which could materially adversely impact our financial performance, financial position and results of operations. We are subject to environmental laws, regulations and permits that may subject us to material costs, liabilities and obligations. We are subject to Federal and State environmental laws, regulations and permits in the jurisdiction in which we operate, including those relating to, among other things, the removal and extraction of natural resources, the emission and discharge of materials into the environment, including greenhouse gas emissions, plant and wildlife protection, remediation of soil and groundwater contamination, reclamation and closure of properties, including tailings and waste impoundments, groundwater quality and availability, and the handling, storage, transport and disposal of wastes and hazardous materials. Pursuant to such requirements we may be subject to inspections or reviews by governmental authorities. Failure to comply with these environmental requirements may expose us to litigation, fines or other sanctions, including the revocation of permits and suspension of operations. We expect to incur significant capital and other compliance costs related to such requirements. These laws, regulations and permits, and the enforcement and interpretation thereof, change frequently and generally have become more stringent over time. Certain environmental laws impose joint and several strict liability for releases of hazardous substances at properties or sites, without regard to fault or the legality of the original conduct. Accordingly, we may be held responsible for more than our share of the contamination or other damages, up to and including the entire amount of such damages. In addition to potentially significant investigation and remediation costs, such matters can give rise to claims from governmental authorities and other third parties, including for orders, inspections, fines or penalties, natural resource damages, personal injury, property damage, toxic torts and other damages. Our costs, liabilities and obligations relating to environmental matters could have a material adverse effect on our financial performance, financial position and results of operations. There is no existing market for our common stock and we do not know if one will develop. Even if a market does develop, the stock price in the market may not exceed the offering price. Prior to this offering, there has not been a public market for our common stock. We cannot predict the extent to which investor interest in our Company will lead to the development of an active trading market on the OTCBB or otherwise, or how liquid that market may become. An active trading market for our common stock may not develop and even if it does develop, may not continue upon the completion of this offering and the market price of our common stock may decline below the initial public offering price. Consequently, you may not be able to sell shares of our common stock at prices equal to or greater than the price you pay in this offering. The market price of our common stock may be volatile, which could result in substantial losses for you. The initial public offering price may vary from the market price of our common stock after this offering. Some of the factors that may cause the market price of our common stock to fluctuate include: failure to identify mineral reserves at our properties; failure to achieve production at our mineral properties; actual or anticipated changes in the price of silver and base metal by-products; fluctuations in our quarterly and annual financial results or the quarterly and annual financial results of companies perceived to be similar to us; changes in market valuations of similar companies; success or failure of competitor mining companies; changes in our capital structure, such as future issuances of securities or the incurrence of debt; sales of large blocks of our common stock; announcements by us or our competitors of significant developments, contracts, acquisitions or strategic alliances; changes in regulatory requirements and the political climate in the United States; litigation involving our Company, our general industry or both; additions or departures of key personnel; investors general perception of us, including any perception of misuse of sensitive information; changes in general economic, industry and market conditions; accidents at mining properties, whether owned by us or otherwise; natural disasters, terrorist attacks and acts of war; and our ability to control our costs. In addition, if the market for stocks in our industry, or the stock market in general, experiences a loss of investor confidence, the trading price of our common stock could decline for reasons unrelated to our business, financial condition or results of operations. If any of the foregoing occurs, it could cause our stock price to fall and may expose us to lawsuits that, even if unsuccessful, could be both costly to defend against and a distraction to management. Broker-dealers may be discouraged from effecting transactions in our common shares because they are considered a penny stock and are subject to the penny stock rules. Rules 15g-1 through 15g-9 promulgated under the Exchange Act impose sales practice and disclosure requirements on certain brokers-dealers who engage in certain transactions involving a penny stock. Subject to certain exceptions, a penny stock generally includes any non-NASDAQ equity security that has a market price of less than $5.00 per share. Our common stock has traded below $5.00 per share throughout its trading history. The additional sales practice and disclosure requirements imposed upon broker-dealers may discourage broker-dealers from effecting transactions in our shares, which could severely limit the market liquidity of the shares and impede the sale of our shares in the secondary market. A broker-dealer selling penny stock to anyone other than an established customer or accredited investor, generally, an individual with net worth in excess of $1,000,000 or an annual income exceeding $200,000, or $300,000 together with his or her spouse, must make a special suitability determination for the purchaser and must receive the purchaser s written consent to the transaction prior to sale, unless the broker-dealer or the transaction is otherwise exempt. In addition, the penny stock regulations require the broker-dealer to deliver, prior to any transaction involving a penny stock, a disclosure schedule prepared by the United States Securities and Exchange Commission relating to the penny stock market, unless the broker-dealer or the transaction is otherwise exempt. A broker-dealer is also required to disclose commissions payable to the broker-dealer and the registered representative and current quotations for the securities. Finally, a broker-dealer is required to send monthly statements disclosing recent price information with respect to the penny stock held in a customer s account and information with respect to the limited market in penny stocks. Our current Director holds the only voting stock for the company. This will prevent any shareholders who purchase our nonvoting stock from having the ability to control any of our corporate actions. As a result, he can exercise substantial control over stockholder and corporate actions. Our Director currently controls the only voting stock in the Company. This means that any corporate transactions can be completed only at his discretion. As a result of this substantial control of our voting stock, our CEO will have total control over the entire company. This concentration of ownership may also have the effect of delaying or preventing a change in control, which in turn could have a material adverse effect on the market price of the Company s common stock or prevent stockholders from realizing a premium over the market price for their Shares. In addition, this ownership could discourage the acquisition of our common stock by potential investors and could have an anti-takeover effect, possibly depressing the trading price of our common stock. Our Director has the ability to control various corporate decisions, including our direction and policies, the election of directors, the content of our charter and bylaws and the outcome of any other matter requiring stockholder approval, including a merger, consolidation and sale of substantially all of our assets or other change of control transaction. The concurrence of our Class B stockholders will not be required for any of these decisions. FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements, which include information relating to future events, future financial performance, strategies, expectations, competitive environment, regulation and availability of resources. These forward-looking statements include, without limitation, statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operating results, and future economic performance; and statements of management s goals and objectives and other similar expressions concerning matters that are not historical facts. Words such as may, should, could, would, predicts, potential, continue, expects, anticipates, future, intends, plans, believes, estimates and similar expressions, as well as statements in future tense, identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made or management s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to: our ability to retain the continued service of our key professionals and to identify, hire and retain additional qualified professionals; general economic conditions, nationally and globally, and their effect on the market for our services; changes in laws, regulations, or policies; our ability to successfully manage our growth strategy; other factors identified throughout this prospectus, including those discussed under the headings Risk Factors Forward-looking statements speak only as of the date the statements are made. You should not put undue reliance on any forward-looking statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions, or changes in other factors affecting forward-looking information, except to the extent required by applicable securities laws. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements. USE OF PROCEEDS If we are able to sell all of the shares of our common stock we are offering through this prospectus, then we will raise gross proceeds of $25,000,000. There is no assurance we will be able to raise additional funds, and further, our officers and directors are under no contractual obligation to make additional investments or otherwise advance funds in support of the Company. Our offering is being made on a self-underwritten basis. No minimum number of shares must be sold in order for the offering to proceed. The offering price per share is $.25. The following table sets forth the uses of proceeds assuming the sale of 25%, 50%, 75% and 100%, respectively, of the securities offered for sale by us. USE OF PROCEEDS If 25% of the Shares are Sold If 50% of the Shares are Sold If 75% of the Shares are Sold If 100% of the Shares are Sold Gross Proceeds $ 6,250,000 $ 12,500,000 $ 18,750,000 $ 25,000,000 Operational Expenses (1)* 250,000 500,000 1,000,000 1,500,000 Drilling & Geology, Copper Blowout Ridge (4) 2,000,000 4,000,000 5,250,000 7,500,000 Mine Acquisition (3) 2,000,000 4,000,000 7,000,000 9,000,000 Site Improvement for Blowout Ridge (2) 300,000 600,000 900,000 1,200,000 Working Capital/Cash Reserves 1,500,000 3,000,000 4,000,000 5,000,000 Equipment & property purchase for Copper Blowout (5) 200,000 400,000 600,000 800,000 TOTALS $ 6,250,000 $ 12,500,000 $ 18,750,000 $ 25,000,000 (1) Includes: Executive salaries, general overhead, licensing and permitting fees. * - Our general and administrative expenses consist of: professional fees, such as legal, audit and accounting, transfer agent and filing agent fees; office expenses; officers compensation; salaries and other miscellaneous expenses related to our general corporate activities and implementation of our business plan. Currently, we do not have any arrangements for additional financing. If we are not able to obtain needed financing and generate sufficient revenue from operations, we may have to cease operations. We intend to repay an open promissory note from proceeds out of the operational expenses. The total amount on the note is $13,015. (2) Site improvement includes obtaining permits and equipment for road grading, fencing, locating and drilling water wells, and other improvements on the mining claims. (3) Includes the cost of seeking, investigating, purchasing, and capital for bringing acquired mines into production. (4) This includes costs for obtaining bonding, general liability insurance, permitting, contracting with a third-party company for core drilling for our JV on the copper blowout ridge, storing core samples as a secured facility, shipping the core samples to an assayer for analysis, and hiring geologists to conduct further geology on the properties. (5) This includes costs for obtaining vehicles to be used on the mining claims, for purchasing private property in Meadview, AZ for storing core samples, employee housing, and securing other equipment and tools we acquire. DETERMINATION OF OFFERING PRICE There is no established market for our common stock. The Offering Price of the Shares has been determined arbitrarily by the Company and bears no direct relationship to our assets, book value, earnings, or other established criteria for valuing a privately held company. In determining the number of Shares to offer and the Offering Price, we took into consideration our capital structure and the amount of money we would need to implement our business plan. The Offering Price of the Shares should not be considered an indication of the actual or subsequent trading value of our common stock. Our Director, Lacome, purchased 100,000,000 shares at par value, for a total of $100, as founder s shares. Our President & CEO, Brown, received stock in exchange for director/officer s services. The price and/or value paid by both directors had no bearing on determining our offering price. DILUTION Dilution represents the difference between the offering price and the net tangible book value per share immediately after completion of this offering. Net tangible book value is the amount that results from subtracting total liabilities and intangible assets from total assets. Dilution arises mainly as a result of our arbitrary determination of the offering price of the shares being offered. Dilution of the value of the shares you purchase is also a result of the lower book value of the shares held by our existing stockholders. We intend to sell 100,000,000 shares of our common stock at a price of $0.25 per share. The following table sets forth the number of shares of common stock purchased from us, the total consideration paid and the price per share. The table assumes all 100,000,000 shares of common stock will be sold. Shares Issued Total Consideration Number of Shares Percent Amount Percent Price Per Share Existing Shareholder 127,300,000 56 % $ 2,400 0.01 % $ 0.001 Purchasers of Shares 100,000,000 44 % $ 25,000,000 99.09 % $ 0.25 Total 227,300,000 100 % $ 25,002,400 100 % The following table sets forth the difference between the offering price of the shares of our common stock being offered by us, the net tangible book value per share, and the net tangible book value per share after giving effect to the offering by us, assuming that 100%, 75%, and 50% of the offered shares are sold. Net tangible book value per share represents the amount of total tangible assets less total liabilities divided by the number of shares outstanding as of September 30, 2014. Totals may vary due to rounding. If 100% of the Shares are Sold If 75% of the Shares are Sold If 50% of the Shares are Sold If 25% of the Shares are Sold Offering price per share $0.25 $0.25 $0.25 $0.25 Book value per share before offering $0.00026 $0.00026 $0.00026 $0.00026 Book value per share after offering $0. 11013 $0.09285 $0.07069 $0.04126 Increase in net tangible book value per share attributable to cash payments made by new investors $0.10987 $0.09259 $0.07043 $0.04100 Per share dilution to new Investors $0.13987 $0.15715 $0.17931 $0.20874 Percentage Dilution to new investors 56% 63% 72% 84% BUSINESS DESCRIPTION The Company Seirra Madre mining is an exploration stage company. We have no subsidiaries. The Company has not been the subject of any bankruptcy, receivership or similar proceedings or any reclassification, merger or consolidation proceedings. We have not generated revenue from mining operations. We are engaged in the business of acquisition and exploration of mineral properties. The Company has a 20% ownership interest in 200 lode mining claims located in Mohave County, Arizona. The other 80% mineral owners are either AJA Mining, LLC, or Gold Basin Exploration, LLC, whom we have a JV with. Throughout the prospectus we may refer to the claims as the Copper Blowout Ridge, Arizona Mine, Blowout Ridge, Gold Hill, our claims or the claims. We have an option to purchase, within two years, the remaining 80% ownership interest in the 200 lode claims. The terms of the purchase are included with the JV agreement we signed with AJA & Gold Basin. We will keep our 20% ownership interest as long as we continue to pay our portion of the annual BLM fees. There is a 2% NSR that AJA & Gold Basin will retain during this period, and even after we elect to exercise our option to purchase the remaining 80% ownership interest. We are presently in the exploration stage at the Property. Mineral property exploration is typically conducted in phases. The exploration activities have so far been taking surface samples. Our next phase would be to conduct core drilling, which we lack the funding to do. Once we have completed each phase of exploration and analyzed the results, we will make a decision as to whether we will proceed with each successive phase. Our Board will make decisions on whether to proceed or not, based on our drilling results. Our goal in exploration of the Property is to ascertain whether it possesses economic quantities of mineralization. We cannot assure you that any economical mineral deposits exist on the Property until appropriate exploration work is completed. Even if we complete our proposed exploration program on the Property and we are successful in identifying a mineral deposit, we will have to spend substantial funds on further drilling and engineering studies before we will know if we have a commercially viable mineral deposit. 2% NSR If we ever go into operation on the mining claims, we will pay a 2% NSR to AJA Mining & Gold Basin Mining. Payments will be made quarterly, no later than 20 business days following the end of each calendar quarter. Quarterly royalty payments will be provisional and subject to adjustment at the end of Lessee's accounting year. If no written objection is made by Lessor to the correctness of a royalty payment or its accompanying statement within two years from the date of such payment, such statement shall be conclusively deemed to be correct and such royalty payment sufficient and complete, and no exception or claim for adjustment shall thereafter be permitted. The term "NSR" means the dollar amount actually received by Lessee from the sale of minerals from the Property less costs of shipping, insurance and transportation. All payments and royalties payable hereunder may be made by Lessee s check, and delivery thereof shall be deemed completed on the mailing thereof to Lessor. Option to Purchase Sierra has the option to purchase the remaining 80% ownership interest in all 200 claims from AJA & Gold Basin Mining under any of the following options 1) $30,000,000 cash, to be made within 30 days of triggering the option, 2) $15 million cash, plus $20 million worth of Sierra class B common stock, based on the preceding six month average closing price for Sierra s stock, 3) paying AJA $250,000 per month, starting 12/15/15, for a period of up to 24 months. At any time during the 24 month period Sierra may purchase the claims for $30,000,000. The monthly payments do not offset the purchase price. b) The buyout option terminates after 24 months, starting January 1st, 2015 if Sierra elects not to purchase the claims. JV Operators Our JV Operators for copper blowout are Keith Jay, Thomas Arkoosh, and John Arkoosh. The JV agreement includes a clause that we register part of the shares issued to AJA and Gold Basin with our S-1. We mutually agreed not to register their shares with this S-1, but may register the LLC member s shares in the future. The JV Operators, and the LLC s, under our agreement, are not required to fund any of the exploration activities. Keith S. Jay - Mr. Jay, age 60, received a B.A. in Biochemistry from the University of Wisconsin-Madison in 1977 and has been involved in the mining industry for over 30 years. Positions included Operations Manager, Mill Superintendent, Project Manager of mining and mineral processing companies, as well a partner in mineral exploration companies in the Southwest, USA. Mr. Jay is also a Certified Environmental Manager in Nevada performing consulting activities for permitting mining exploration and processing activities, interfacing with both Federal BLM and State EPA agencies for environmental compliance and financial guarantees with successful approvals to proceed. Thomas J. Arkoosh - Mr. Arkoosh, age 50, received a B.A. from the University of Washington and has worked in various positions with mining companies for 20 years. Mr. Arkoosh is a Mine Safety and Health Administration (MSHA) instructor performing mine safety and training to mine workers. Mr. Arkoosh has worked in mineral processing as well as a primary landman for the proper mine claim-staking and property acquisition. Mr. Arkoosh also assisted in claim survey and exploration seismic activities for AJA Mining, LLC & Gold Basin Exploration, LLC. John T. Arkoosh, Sr. - Mr. Arkoosh, age 66, graduated from the University of Washington (1971) with a B.A. in Finance and University of California (1974) B.S. in Accounting. Mr. Arkoosh worked for British Petroleum (BP) Alaska Exploration, Inc., a 100% subsidiary of British Petroleum, Inc. starting as an accountant and eventually becoming Controller. During his tenure, Mr. Arkoosh has acquired knowledge in accounting, budgeting, and contracts in the area of commodities. Recently, Mr. Arkoosh has co-founded two Limited Liability Companies (LLC) AJA Mining, and Gold Basin Exploration, LLC, in mineral prospecting. Surface Samples In July, 2014, AJA Mining took twenty rock samples from the copper blowout ridge. The samples were taken from twenty outcroppings that were located in a 40 acre area on the copper blowout ridge. The samples were conducted by Skyline Assayers & Laboratories in Tucson, Arizona. The results are included as an exhibit with our S-1. This has been the only sampling that we know of that has been done. In summary, the samples taken showed Cu from 0 to 12.9%, Fe from 0 to 36.9%, and Au from 0 to 4.95 grams/Mt. The Mineral Claims The Claims are described as the our mining claims are recorded in Mohave County, Arizona, in the name of AJA Mining, LLC and Gold Basin Exploration, LLC, with a 20% ownership interest to Sierra Madre Mining. The following are the serial numbers of the recorded claims. The claims are in good standing as of the date of this prospectus. NAME AMC # NAME AMC # NAME AMC # NAME AMC # NAME AMC # TUT-1 AMC415013 BB-1 AMC420119 AJA-1 AMC413510 GBM-1 AMC420131 GBM-38 AMC420168 TUT-2 AMC415014 BB-2 AMC420120 AJA-2 AMC413511 GBM-2 AMC420132 GBM-39 AMC420169 TUT-3 AMC415015 BB-3 AMC420121 AJA-3 AMC413512 GBM-3 AMC420133 GBM-40 AMC420170 TUT-4 AMC415016 BB-4 AMC420122 AJA-4 AMC413513 GBM-4 AMC420134 GBM-41 AMC420171 TUT-5 AMC415017 BB-5 AMC420123 AJA-5 AMC413514 GBM-5 AMC420135 GBM-42 AMC420172 TUT-6 AMC415018 BB-13 AMC425251 AJA-6 AMC413515 GBM-6 AMC420136 GBM-43 AMC420173 TUT-7 AMC415019 BB-14 AMC425252 AJA-7 AMC413516 GBM-7 AMC420137 GBM-44 AMC420174 TUT-8 AMC415020 BB-15 AMC425253 AJA-8 AMC413517 GBM-8 AMC420138 GBM-45 AMC420175 TUT-9 AMC415597 BB-16 AMC425254 AJA-9 AMC413518 GBM-9 AMC420139 GBM-46 AMC420176 TUT-10 AMC415598 BB-17 AMC425255 AJA-10 AMC413519 GBM-10 AMC420140 GBM-47 AMC420177 TUT-11 AMC415599 BB-18 AMC425256 AJA-11 AMC413520 GBM-11 AMC420141 GBM-48 AMC420178 TUT-12 AMC415600 BB-19 AMC425257 AJA-12 AMC413521 GBM-12 AMC420142 GBM-49 AMC420179 TUT-13 AMC415601 BB-20 AMC425258 AJA-13 AMC413769 GBM-13 AMC420143 GBM-50 AMC420180 TUT-14 AMC415602 BB-21 AMC425259 AJA-14 AMC414246 GBM-14 AMC420144 GBM-51 AMC420181 TUT-15 AMC415603 BB-22 AMC425260 AJA-15 AMC414247 GBM-15 AMC420145 GBM-52 AMC420182 TUT-16 AMC415604 BB-23 AMC425261 AJA-16 AMC414248 GBM-16 AMC420146 GBM-53 AMC420183 TUT-17 AMC416173 BB-24 AMC425262 AJA-17 AMC414249 GBM-17 AMC420147 GBM-54 AMC420184 TUT-18 AMC416174 BB-25 AMC425263 AJA-18 AMC414252 GBM-18 AMC420148 GBM-55 AMC420185 TUT-19 AMC416175 BB-26 AMC425264 AJA-19 AMC414253 GBM-19 AMC420149 GBM-56 AMC420186 TUT-20 AMC416176 BB-27 AMC425265 AJA-20 AMC414254 GBM-20 AMC420150 GBM-57 AMC420187 TUT-21 AMC416177 BB-28 AMC425266 AJA-21 AMC414255 GBM-21 AMC420151 GBM-58 AMC420188 TUT-22 AMC416178 BB-29 AMC425267 AJA-22 AMC414256 GBM-22 AMC420152 GBM-59 AMC420189 TUT-23 AMC416179 BB-30 AMC425268 AJA-23 AMC414257 GBM-23 AMC420153 GBM-60 AMC420190 TUT-24 AMC416180 BB-31 AMC425269 AJA-24 AMC414258 GBM-24 AMC420154 GBM-61 AMC420191 TUT-25 AMC416181 BB-32 AMC425270 AJA-25 AMC414259 GBM-25 AMC420155 GBM-62 AMC420192 TUT-26 AMC416182 BB-33 AMC425271 AJA-26 AMC414260 GBM-26 AMC420156 GBM-63 AMC420193 TUT-27 AMC416183 BB-40 AMC425272 AJA-27 AMC414261 GBM-27 AMC420157 TUT-48 AMC416665 TUT-28 AMC416184 BB-41 AMC425273 AJA-28 AMC414262 GBM-28 AMC420158 TUT-49 AMC416666 TUT-29 AMC416646 BB-42 AMC425274 AJA-29 AMC414263 GBM-29 AMC420159 TUT-50 AMC416667 TUT-30 AMC416647 BB-43 AMC425275 AJA-30 AMC414264 GBM-30 AMC420160 TUT-51 AMC416668 TUT-31 AMC416648 BB-44 AMC425276 AJA-31 AMC414265 GBM-31 AMC420161 TUT-52 AMC416669 TUT-32 AMC416649 BB-45 AMC425277 AJA-32 AMC414266 GBM-32 AMC420162 TUT-53 AMC416670 TUT-33 AMC416650 BB-46 AMC425278 AJA-33 AMC414267 GBM-33 AMC420163 TUT-54 AMC416671 TUT-34 AMC416651 BB-47 AMC425279 TUT-57 AMC416674 GBM-34 AMC420164 TUT-55 AMC416672 TUT-35 AMC416652 TUT-43 AMC416660 TUT-58 AMC416675 GBM-35 AMC420165 TUT-56 AMC416673 TUT-36 AMC416653 TUT-44 AMC416661 TUT-59 AMC416676 GBM-36 AMC420166 TUT-65 AMC416682 TUT-37 AMC416654 TUT-45 AMC416662 TUT-60 AMC416677 GBM-37 AMC420167 TUT-66 AMC416683 TUT-38 AMC416655 TUT-46 AMC416663 TUT-61 AMC416678 TUT-67 AMC416684 TUT-39 AMC416656 TUT-47 AMC416664 TUT-62 AMC416679 TUT-68 AMC416685 TUT-40 AMC416657 TUT-63 AMC416680 TUT-69 AMC416686 TUT-41 AMC416658 TUT-64 AMC416681 TUT-70 AMC416687 TUT-42 AMC416659 The Copper Blowout Ridge Project The Copper Blowout Ridge is an early stage exploration project located at the Gold Basin-Lost Basin mining districts of northwestern Arizona, in Mojave County, 120 km southeast of Las Vegas, Nevada, and about 95 km north of Kingman, Arizona. (See USGS Professional Paper 1361). It consists of 200 lode claims located in two separate blocks of 97 claims and 103 claims, more or less contiguous, located in Mohave County, Arizona. Both directors visited the 200 mining claims in July & August, 2014. Property Description and Ownership The Gold Basin-Lost Basin mining districts of northwestern Arizona are in Mojave County, 120 km southeast of Las Vegas, Nevada, and about 95 km north of Kingman, Arizona. (See USGS Professional Paper 1361) The unpatented mining claims comprising the copper blowout ridge occupy public lands administered by the U.S. Bureau of Land Management ( BLM ) and are subject to the ultimate title of the United States. The claims have been filed with both the BLM and Mohave County as required by law. There is an annual BLM fee that must be paid in order to continue to maintain ownership interest in the claims. The fee must be paid on or before September 1st of each year. If we miss the payment we could lose our interest in the claims. It will be Sierra s responsibility to pay our ownership interest in the 20% (800 acres) worth of claims. The BLM charges $140 annually per 20 acres, so our annual maintenance expenses, based on current fees, will be $5,600. Surface use for mining purposes on unpatented mining claims is guaranteed by the Mining Law of 1872. Notice must be given to the BLM prior to drilling. This is accomplished by filing a notice of intent. This is required as long as the disturbance is less than 5 acres. Our drill program will qualify for this. If it exceeds 5 acres we would need to file a plan of operation. Reclamation bonds are also required prior to any disturbance, whether it is under a notice of intent, or plan of operation. The project area is not known to contain any culturally or environmentally sensitive resources. Accessibility The Gold Basin-Lost Basin property is readily accessible by driving southeasterly from Las Vegas, Nevada northwesterly from Kingman, Arizona along Highway 93, east on Pierce Ferry Highway past Dolan Springs, north on Greg s Hideout Road, with the districts on the east and west mountain ranges of Hualapai Valley. A series of dirt roads of various states of repair and well-maintained US BLM access routes lead to most areas within the property in both districts. Most of these roads could be driven by a two-wheel drive vehicle but a four-wheel drive vehicle is recommended where the roads may have deteriorated due to seasonal rainfalls or poor drainage. Areas without roads can be easily accessed by hiking or by use of a motorcycle. Climate and Vegetation The climate is semi-arid to arid; characterized by low precipitation, high evaporation, and large daily temperature variations from -3 to 111degrees F. Annual precipitation averages 12 inches and annual pan evaporation averages about 100 inches. There are no surface waters although evidence of sometimes violent runoff is common in the dry lakebeds. The 100-year, 24-hour storm event is estimated at 4.0 inches of rain (Nevada Pacific, 1997). Exploration work may be carried out year round. It is advisable, however, to exercise care during late July and early August due to the hot, humid temperatures and intermittent rain storms that may cause local flooding. The Gold Basin-Lost Basin property is situated within the Joshua Tree series of the Mojave Desert which is characterized by Joshua trees and white bursage. Yucca and various cacti provide sparse but continuous ground cover. Jack rabbits, deer, various types of reptiles and snakes, and a wide variety of birds inhabit the region. Mining and exploration in the region take place year-round, with only occasional weather-related difficulties such as flash flooding during the monsoon or extreme heat, both of which occur during summer. Local Resources and Infrastructure Arizona is a mining state and is well accustomed to mining activities. Mohave County has a long history of mining and that activity has remained a significant economic element for the County. There are a number of inactive mines and active development projects in the region. The Company believes that the exploration project will be viewed positively by the majority of the area residents. Meadview is the nearest community to the claims, but all lodging, casual labor, supplies for exploration, heavy equipment and operators will come from nearby Kingman, Arizona, or Las Vegas, Nevada. Major support for mine development and operation is available in Kingman. Apart from exploration and mining, the principal land use in the area is recreation and tourism. There are no utilities located at the claims. Electricity will need to be provided by diesel generator. Water will need to be hauled in, or developed by drilling at or near the claims. Physiography The Gold Basin-Lost Basin property is located about 10 miles or less west of the western edge of the Colorado Plateau and on the eastern edge of the Basin and Range physiographic province. Regional relief is about 4,500 feet within the Basin and Range topography, varying from 5,500 feet on the Colorado Plateau to approximately 1,000 feet A.M.S.L. along the valley bottoms. The Property lies on the mountain ranges on both sides of the Hualapai Valley in the White Hills and the Lost Basin Range. The hills are locally incised by seasonal drainages controlled largely by bedrock structures. History The history of the Gold Basin-Lost Basin districts has been described in detail in the History section in the Geology & Gold Mineralization of the Gold Basin-Lost Basin Mining Districts, Mohave County, Arizona (U.S. Geological Survey Professional Paper #1361). A copy of this report is available on our website, and through the United States Geological Survey website. We will quote directly from the USGS paper concerning the district s mining history. Gold in quartz veins apparently was discovered in the district in the early 1870's, and most of the production until 1932 came from a small group of mines, including the El Dorado, Excelsior, Golden Rule, Jim Blaine, Never-Get-Left, O.K., and Cyclopic. About 1880 there was a small boom in the area, and by 1881 the ores were being worked in two stamp mills; in 1882 the El Dorado mine produced 26,000 tons of developed ore. By 1883, most of the important mines in the district had been located, were developed, and had produced relatively small tonnages of free-milling, gold-quartz ores ranging from 0.5 to 3.0 oz gold per ton. In 1904, the Cyclopic mine was purchased by the Cyclopic Gold Mining Company, and the next year a 40-ton-per-day cyanide mill was built along Cyclopic Wash just below the mine. From this time on, "Cyclopic" was the main population center of the district, supporting a post office until 1917. In 1942, four lode mines in the Gold Basin district had a recorded production of 108 oz gold and 24 oz silver from 249 short tons of treated ore. The district has been idle generally from about 1942 to the mid-1970's, except for small-scale placer mining that recovered a little detrital gold. In 1985-86 at least three major mining companies were active in the district; some relatively closely spaced drill holes were put down in the general area of the Owens mine. In recent times the majority of mining has been small-scale placer mining, in both the Gold Basin and Lost Basin. Regional and District Geologic Setting The following is quoted from the USGS Professional Paper 1361. The Gold Basin-Lost Basin mining districts are in the Basin and Range province, just south of Lake Mead and west of the Colorado Plateau. The west edge of the Colorado Plateau is approximately 3 km west of the east edge of the Garnet Mountain quadrangle, where the generally gently east dipping to flat-lying lower Paleozoic basal formations of the Colorado Plateau crop out along the Grand Wash Cliffs. The districts are present in an uplifted region near the leading edge of the North American platform and straddle several north-trending ranges of mostly Proterozoic basement rocks from which the rocks of the Paleozoic stable platform have been removed by erosion. Lake Mead occupies a structurally complex area to the north marked by the junction of several regionally extensive major geologic features. These features include the boundary between the Paleozoic miogeocline and stable platform, the Mesozoic Sevier orogenic belt, and the Las Vegas shear zone. Further, the districts are present along the southern extension of the Virgin Mountains structural block of Longwell and Anderson and Laney (1975). The districts include two ranges of mostly Early Proterozoic metamorphic and igneous rocks, the White Hills and the next range to the east, herein termed the Lost Basin Range but referred to as the Infernal Range by Lucchitta (1966), and two intervening valleys filled by Tertiary and Quaternary deposits (Blacet, 1975). These two valleys are drained by Hualapai Wash and Grapevine Wash, and the latter valley also cuts through Grapevine Mesa. The Grapevine geomorphic trough includes the Grand Wash fault zone, a N. 10 -15 E.- striking system of Miocene normal faults (west block down) now covered by Tertiary fanglomerate and Quaternary gravel. The trace of the Grand Wash fault zone is inferred to pass between Lost Basin Range and Garnet Mountain, southwest of which the Grand Wash fault zone is inferred on the basis of relations apparent in satellite imagery to terminate against a younger northwest-striking structure, herein named the Hualapai Valley fault. The Hualapai Valley fault is inferred to change its strike gradually to almost north-south as it passes west of the Lost Basin Range along the main drainage of Hualapai Wash. Major offsets along the Hualapai Valley fault may be penecontemporaneous with deposition of the uppermost sequences of the upper Miocene limestone. However, along the Grand Wash trough basin-and-range faulting was active during the early stages of basin fill, although movements) along some faults apparently continued after deposition of the upper Miocene limestone. Similarly, initial movements along the Hualapai Valley fault may have contributed toward local development of an embayment in which the limestone was deposited. Early Proterozoic rocks crop out widely in both the Gold Basin and Lost Basin mining districts. These rocks consist mostly of gneiss that presumably is 1,750 Ma and that includes both paragneiss and orthogneiss, the coarsegrained porphyritic monzogranite of Garnet Mountain, and relatively small masses of medium-grained leucocratic monzogranite that crop out as part of the plutonic complex of Garnet Mountain (). In this report, we use the classification of Streckeisen and others. As such, the porphyritic monzogranite of Garnet Mountain and the leucocratic monzogranite correspond to the porphyritic quartz monzonite and leucocratic quartz monzonite of Blacet (1975), who followed the classification of Bateman. The porphyritic monzogranite of Garnet Mountain intrudes gneiss and most likely was emplaced about 1,660 Ma. The Proterozoic terrane in the quadrangle also includes small bodies of granodiorite, gneissic granodiorite, alaskite, various mappable migmatite units, feldspathic gneiss, amphibolites derived from igneous and sedimentary protoliths, and other metasedimentary rocks, including some fairly widespread metaquartzite. In addition, some minor amounts of diabase that presumably is of Middle Proterozic age are exposed mostly as thin northwest-striking dikes in the general area of Iron Spring Basin. Mineral Resource and Mineral Reserves Estimate No reserves have been identified yet on the claims. Exploration Plans Our exploration plan is simple; we intend to adopt the recommendations made by the United States Geological Survey set forth in their report, titled Geology & Gold Mineralization of the Gold Basin-Lost Basin Mining Districts, Mohave County, Arizona (U.S. Geological Survey Professional Paper #1361). The USGS wrote a comprehensive report on the area that the 200 lode claims now sit on. Within the report, the USGS recommended drilling to further prove reserves. Provided we have a successful offering, this is what we plan on doing. Our Plan and Objectives for Phase 1 Exploration plan is to obtain and identify information on minerals in the Copper Blowout area focusing on Copper, Gold, Silver and Molybdenum. Estimate time to complete is twelve months. Located in Section 4, Township 29 North, Range 17 West, in the Gila Salt River Base and Meridian, Arizona. Approximate elevation is 3,700 feet. A Registered Geologist will be retained to supervise the surface and subsurface sampling program. A diamond core drill will be used for the placement of approximately 10 to 20 exploration holes, ranging in depth from 300 to 600 feet. Samples will be sent under strict chain-of-custody protocols to 2 to 3 large reputable laboratories in Arizona and Nevada for analysis. Any future Phases will be determined by the results from the data of Phase 1. Operators Budget for Exploration The following is a budget for the copper blowout ridge project. If we raise more money through our offering than $2 million, we intend to expand the exploration to drill more at or near the copper blowout ridge. Drilling; 10 to 20 holes $1,000,000 Laboratory infrastructure at site; sample storage $ 300,000 Management/supervision $ 180,000 Registered Geologist 3rd party $ 80,000 Geochemistry $ 25,000 Geophysics $ 30,000 Surface sampling $ 5,000 Core sample logistics $ 30,000 Permits/Reclamation/Bonding $ 25,000 Insurance; Liability $ 20,000 Road Improvement $ 25,000 Laborers $ 30,000 Truck/trailer $ 60,000 Sleeping trailer $ 40,000 Generators/fuel $ 25,000 ATV $ 10,000 Lease Rentals (BLM) $ 31,000 Contingency/miscellaneous $ 84,000 Total $2,000,000 Compliance with Government Regulation Both Federal and Arizona laws govern work on the claims. Title to mineral claims are issued and administered by the United States Bureau of Land Management (BLM) and any work on the property must comply with all provisions under the BLM surface management regulations. A mineral claim acquires the right to the minerals, which were available at the time of location and as defined in the Mining Act of 1872. There are no surface rights included, but the title holder has the right to use the surface of the claim for mining purposes only. Regulations BLM regulates surface management on mining activity conducted on lands administered by BLM. All mining activities require reasonable reclamation. The lowest level of mining activity, "casual use," is designed for the miner or weekend prospector who creates only negligible surface disturbance (for example, activities that do not involve the use of earth-moving equipment or explosives may be considered casual use). The second level of activity, where surface disturbance is 5 acres or less per year, requires a notice advising BLM of the anticipated work 15 days prior to commencement. This notice needs to be filed with the appropriate field office. No approval is needed although bonding is required. State agencies need to be notified to assure that their requirements are met. For operations involving more than 5 acres, a detailed plan of operation must be filed with the appropriate BLM field office. Bonding is required to ensure proper reclamation. Our drill program will involve less than 5 acres, so at the time we raise the money to start the drilling, we will not need to submit a plan of operation with the BLM. We will need to obtain a bond, and this cost is included as part of our use of proceeds. If we decide that the drilling has positive results, then we would submit a plan of operation. If the plan is approved, the BLM will likely require us to post a bond to cover the cost of any remediation. The cost of remediation work will vary according to the degree of physical disturbance. As mentioned above, we will have to sustain the cost of reclamation and environmental remediation for all exploration and other work undertaken. The amount of reclamation and environmental remediation costs are not known at this time as we do not know the extent of the exploration program that will be undertaken beyond completion of the recommended first phase of the exploration program. Because there is presently no information on the size, tenor, or quality of any mineral resource at this time, it is impossible to assess the impact of any capital expenditures on earnings or our competitive position in the event a potential mineral deposit is discovered. If we enter into substantial exploration, the cost of complying with permit and regulatory environment laws will be greater than in our initial phase because the impact on the project area is greater. Permits and regulations will control all aspects of any program if the project continues to that stage because of the potential impact on the environment. We may be required to conduct an environmental review process, including preparation of an environmental impact statement (EIS) if we determine to proceed with a substantial project. An EIS is not required to proceed until we submit a plan of operation. Environmental Factors We will have to sustain the cost of reclamation and environmental remediation for all work undertaken which causes sufficient surface disturbance to necessitate reclamation work. Both reclamation and environmental remediation refer to putting disturbed ground back as close to its original state as possible. Other potential pollution or damage must be cleaned-up and renewed along standard guidelines outlined in the usual permits. Reclamation is the process of bringing the land back to a natural state after completion of exploration activities. Environmental remediation refers to the physical activity of taking steps to remediate, or remedy, any environmental damage caused, i.e. refilling trenches after sampling or cleaning up fuel spills. Our initial programs do not require any reclamation or remediation other than minor clean up and removal of supplies because of minimal disturbance to the ground. The amount of these costs is not known at this time as we do not know the extent of the exploration program we will undertake, beyond completion of the recommended three phases described above. Because there is presently no information on the size, tenor, or quality of any resource or reserve at this time, it is impossible to assess the impact of any capital expenditures on our earnings or competitive position in the event a potentially economic deposit is discovered. Exploration No significant exploration work has, as yet been completed on the claims. Drilling No drilling has, as yet, been completed by the Company and there is no evidence on the ground of historic drilling activities. Competitive Factors The mining industry is fragmented, and there are many mineral prospectors and producers, small and large. We do not compete with anyone with respect to the Claim. That is because there is no competition for the exploration or removal of minerals from the Property. We will either find gold or other valuable metals on the Property, or not. If we do not, we will cease or suspend operations. Location Challenges We do not expect any major challenges in accessing the Property during the initial exploration stages. Environmental Factors We will also have to sustain the cost of reclamation and environmental remediation for all work undertaken which causes sufficient surface disturbance to necessitate reclamation work. Other potential pollution or damage must be cleaned-up and renewed along standard guidelines outlined in the usual permits. Reclamation is the process of bringing the land back to a natural state after completion of exploration activities. Environmental remediation refers to the physical activity of taking steps to remediate, or remedy, any environmental damage caused, i.e. refilling trenches after sampling or cleaning up fuel spills. Our initial programs do not require any reclamation or remediation other than minor clean up and removal of supplies because of minimal disturbance to the ground. The amount of these costs is not known at this time as we do not know the extent of the exploration program we will undertake, beyond completion of the recommended phases described above. Because there is presently no information on the size, tenor, or quality of any resource or reserve at this time, it is impossible to assess the impact of any capital expenditures on our earnings or competitive position in the event a potentially economic deposit is discovered. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this Prospectus. The discussions of results, causes and trends should not be construed to imply any conclusion that these results or trends will necessarily occur. This discussion includes forward-looking statements that involve risks and uncertainties. As a result of many factors, such as those set forth under Risk Factors and elsewhere in this Prospectus, our actual results may differ materially from those anticipated in these forward-looking statements. Going Concern The notes to the Company s financial statements express substantial doubt about the Company s ability to continue as a going concern because of the Company s accumulated deficit since inception and the further losses which are anticipated in the development of its business. The Company s ability to continue as a going concern is dependent upon the Company s generation of profits in the future and/or the ability to obtain financing necessary to meet its obligations. We have had no revenues since our inception. Plan of Operation We are an exploration stage company. We have not yet started operations or generated or realized any revenues from our business operations. Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated any revenues and no revenues are anticipated until we begin removing and selling minerals. Accordingly, we must raise cash from sources other than the sale of minerals found on the Property. Our only other sources for cash at this time are loans from related parties and additional sales of common stock. Our success or failure will be determined by what additional financing we obtain and what we find under the ground. If we find mineralized material and it is economically feasible to remove the mineralized material, if our direct offering is successful then we will be able to start the process for obtaining a mining operator s permit with the BLM, and begin improvements on the property in preparation for having the mine in production. At the present time, we have not made any arrangements to raise additional cash. If we need additional cash and can't raise it, we will either have to suspend activities until we do raise the cash, or cease activities entirely. Other than as described in this paragraph, we have no financing plans. Even if we complete our current exploration program and it is successful in identifying a mineral deposit, we will have to spend substantial funds on further drilling and engineering studies before we will know if we have a commercially viable mineral deposit, a reserve. We will be conducting research in the form of exploration of the Property with sufficient funding. Our exploration program is explained in as much detail as possible in the business section of this Prospectus. We are not going to buy or sell any plant or significant equipment during the next twelve months. We will not buy any equipment until have located a reserve and have determined it is economical to extract the minerals from the land. If we find mineralized materials in the Property, we intend to try to develop the reserves ourselves. We do not intend to hire employees at this time. All of the work on the Property will be conducted by our JV partners. They will be responsible for surveying, geology, engineering, exploration, and excavation. One of our Directors will be there as a representative for the company during operations. If we hire an independent geologist, they will evaluate the information derived from the exploration and excavation and the engineers will advise us on the economic feasibility of removing the mineralized material. Mineral property exploration is typically conducted in phases. Based on the U.S.G.S. report, U.S. Geological Survey Professional Paper #1361, we intend to follow the government geologists recommendations and begin drilling to determine if there are sufficient reserves on the property. We estimate the cost of the drilling, shipping samples, as well as geological mapping, rock chip sampling, grid establishment, hiring geologists, and soil sampling, will cost $2,000,000. After the completion of the first phase of the exploration program, we will review the results and conclusions and evaluate the advisability of additional exploration work on the Property. If we are unable to complete any phase of exploration because we don t have enough money, we will cease activities until we raise more money. If we can t or don t raise more money, we will cease activities. If we cease activities, we have no plans for any other business activity. Our JV Partners on the Copper Blowout Ridge Project are: Thomas Arkoosh, Keith Jay, and John Arkoosh. They are conducting the exploration stage operations since they are experienced in mining. Limited Operating History; Need for Additional Capital We have not yet commenced the initial phase of exploration on the Property. We would need additional financing to cover exploration costs, although we currently do not have any specific financing arranged. Further exploration would be subject to financing. Management expects to finance operating costs over the next twelve months with proceeds from a securities offering. Expenses The Company s main activities in 2014 were related to the initial public offering process, and pursuing potential mining claim properties to purchase or JV into for our Company. The Company started its process of initial public offering in 2014 and incurred most of the related expenses prior to the initial filing of a registration statement. Results of Operations We did not earn any revenues from our incorporation on 11/6/13, to September 30, 2014. We are in the exploration stage of our business and can provide no assurance that we will discover economic mineralization on our mineral property. For the period November 6, 2013 (Inception) through December 31, 2013, we incurred operating expenses in the amount of $9,134 which comprised of general and administrative expenses, relating to filing fees and professional fees. We incurred total operating expenses in the amount of $28,815 for the period November 6, 2013 (Inception) through September 30, 2014. These operating expenses were comprised of filing fees and professional fees. Important Assumptions Mineral exploration and development involve a high degree of risk and few properties that are explored are ultimately developed into producing mines. At this stage without having conducted the initial exploration phase, we are unable to determine whether future mineral exploration and development activities will result in any discoveries of proven or probable reserves. Even if we discover commercial quantities of mineralization, the mineral Property may never be brought into commercial production. Our development of mineral properties will occur only upon obtaining sufficient funding and satisfactory exploration results. Liquidity At September 30, 2014 our cash and cash equivalents balance was $0. Without additional investment capital from shareholders or other sources, the Company has no short term source of liquidity. In order to begin mining operations, significant amounts of working capital will be needed to continue. The Company s illiquid financial position could cause it to not be able to start mining in the near future unless working capital from the offering or some other source of short term liquidity is developed. Management does not believe that the Company s current capital resources will be sufficient to fund its operating activity and other capital resource demands during the next year. Our ability to continue as a going concern is contingent upon our ability to obtain capital through the sale of equity or issuance of debt, and ultimately attaining profitable operations. There is no assurance that we will be able to successfully complete any one of these activities. The independent registered public accounting firm s report on our consolidated financial statements as 9/30/14, includes an explanatory paragraph that describes substantial doubt about the Company s ability to continue as a going concern. Changes In and Disagreements with Accountants None. Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors. Critical Accounting Policies Our discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of the consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies affect our most significant judgments and estimates used in preparation of our consolidated financial statements. DIRECTORS, OFFICERS AND CONTROL PERSONS The following table sets forth the name and age of our current officers and directors. Our Board of Directors appoints our executive officers. Our directors will serve until the earlier occurrence of the election of his or her successor at the next meeting of stockholders, death, resignation or removal by the Board of Directors. Michael Halsey Brown President, Chairman, CFO, and CEO Brown is 72 years old and is our CEO, CFO, President, and Chairman. He has extensive training in chemistry and industrial arts (power mechanics, machine shop, foundry practice, and electronics) from Berea College, in Berea, Kentucky, from 1978 to 1981, and also from Palomar College, in San Marcos from 1987 to 1989. In 1981 he had his own manufacturing company that produced the Fish carburetor. He managed up to 10 employees at a time. The company continued to produce the carburetors for a total of 15 years. He discontinued production in 1996, however in that same year he focused on engineering and manufacturing piston steam engines. In that year he formed the Mike Brown Steam Engine Company. The company manufactures, and continues to produce, 1hp, 3hp, and 20 hp steam engines. He recently joined Sierra Madre Mining Co. in June, 2014. Based on his previous and extensive experience in business and various technical fields, we feel he is more than qualified to serve as our CEO, CFO, Chairman & President. Joseph Lacome Founder & Director Mr. Lacome is 37 years old & is the founder & Director of Sierra Madre Mining. He has been a solo practitioner since July, 2010, until now. Prior to that period he was in law school fulltime and was not working. He holds a Bachelor s degree in Liberal Studies and a Juris Doctorate. During the first two years of practice he dealt primarily in immigration, criminal and business law. For the past two years his practice focused on business law, contracts, and securities law for private individuals. He has limited experience in the mining industry, specifically, with small scale placer mining in Mexico and Arizona in 2013, as well as by taking several college courses in geology. While in Mexico he gained knowledge of placer mining, specifically identifying areas where potential deposits are located, he learned how to operate a dredge machine, and highbanker, and also managed up to five workers at a time with the placer mining operation. Since our inception he has also visited over a dozen separate mines, and has read and reviewed dozens of technical reports on prospective mines. We believe that, although he has limited experience in mining, his experience as a lawyer, and entrepreneurial drive to create our company, provides him with the necessary skills to serve as a member of our board of directors and will enable him to provide valuable insight to the board regarding operational, legal and management issues. No Officer or Director has been or is subject to any legal proceeding as identified in Regulation S-K Item 401(f) Allocation of Our Affiliates Time We rely on our directors & executives, who act on our behalf for the day-to-day operation of our business. The time commitment required of our officers and directors will vary depending upon a variety of factors, including, but not limited to, general economic and market conditions affecting us, the amount of proceeds raised in this offering and our ability to locate and acquire investments that meet our investment objectives. We estimate that our executive officer will initially spend approximately 50% of his time on the management of our business following the completion of this offering, and our Director, Lacome, will devote 20% of his time towards our company. Our executive officer intends, however, to devote as much time to the management of our business and affairs as is necessary for the proper conduct of our business and affairs. Board Committees The Company does not currently have a designated audit, nominating or compensation committee. The Company currently has no plans to form these separately designated board committees. Term of Office Our directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board of directors. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table lists, as of the date of this prospectus, the number of shares of common stock of our Company that are beneficially owned by (i) each person or entity known to our Company to be the beneficial owner of more than 5% of the outstanding common stock; (ii) each officer and director of our Company; and (iii) all officers and directors as a group. Information relating to beneficial ownership of common stock by our principal shareholders and management is based upon information furnished by each person using beneficial ownership concepts under the rules of the Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Except as noted below, each person has sole voting and investment power. The percentages below are calculated based on 127,300,000 shares of our Class A & B stock issued and outstanding as of the date of this prospectus. We do not have any outstanding warrants, or other securities exercisable for or convertible into shares of our common stock. We have 19,000,000 unexercised stock option agreements for our Director. Title of Class Name and Address of Beneficial Owner Amount and Nature of Beneficial Ownership Percent of Class Stock (1) Class B Michael Brown(2) 10,000,000 8.17 % Class A Joseph Lacome 5,000,000 100 % Class B Joseph Lacome (3) 95,000,000 77.67 % All directors and executive officers as a group (2 persons) 110,000,000 86.41 % __________________ (1) The percentages below are based on 127,300,000 shares of our class A & B stock issued and outstanding as of the date of this prospectus. (2) Appointed President, CEO, CFO & Chairman on 6/13/14. (3) Appointed Director on 11/7/13 EXECUTIVE COMPENSATION Summary Compensation Table (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) Change in Pension Value & Non-Equity Nonqualified Incentive Deferred All Stock Option Plan Compensation Other Name and Principal Salary Bonus Awards Awards Compensation Earnings Compensation Totals Position Year ($) ($) ($) ($) (S) ($) ($) ($) Michael Brown 2014 0 0 10,200 0 0 0 0 10,200 President, PAO, CEO & CFO (1) Joseph Lacome 2014 0 0 100 6,922 0 0 0 7,022 Director (2) 2013 0 0 0 0 0 0 0 0 (1) The Company entered into an at-will employment agreement with Mr. Brown on 6/13/14. Under the terms of the agreement, the Company does not give him a salary, but did issue 10,000,000 shares in exchange for Director & executive services. Mr. Brown's stock compensation was issued on June 13, 2014. (2) The Company entered into an at-will employment agreement with Mr. Lacome on 11/7/13. Under the terms of the agreement, the Company does not give Lacome a salary. He has a stock option agreement for 19,000,000 class B shares, in exchange for his services as Director. Mr. Lacome's stock and stock options were granted on November 7, 2013. The options are being amortized straight line over the vesting period. We are not registering common shares held by any stockholder who holds more than 5% of outstanding common shares and we are not registering shares held by our officers and directors. Director Compensation Table (a) (b) (c) (d) (e) (f) (g) (h) Change in Pension Fees Value and Earned Non-Equity Nonqualified or Incentive Deferred All Paid in Stock Option Plan Compensation Other Cash Awards Awards Compensation Earnings Compensation Total Name ($) ($) ($) ($) ($) ($) ($) Michael Brown 0 10,200 0 0 0 0 10,200 Joseph Lacome 0 100 6,922 0 0 0 7,022 STOCK OPTION GRANTS The following table sets forth certain information concerning outstanding stock awards held by our officers and our directors as of the fiscal year ended September 30, 2014. These options all listed herein are for Class B stock only. Option Awards Stock Awards Name Grant Date Number of Securities Underlying Unexercised Options (#) Exercisable Number of Securities Underlying Unexercised Options (#) Unexercisable Option Exercise Price ($) Option Expiration Date Number of Shares or Units of Stock That Have Not Vested (#) Market Value of Shares or Units of Stock That Have Not Vested ($) Joseph Lacome 11/7/2013 - 5,000,000 .01 11/6/2023 - 11/7/2013 - 7,000,000 .01 11/6/2023 - 11/7/2013 - 7,000,000 .10 11/6/2023 - TRANSACTIONS WITH RELATED PERSONS, PROMOTERS AND CERTAIN CONTROL PERSONS We issued 100,000,000 shares of stock (5 million class A, 95 million class B) to Joseph Lacome, our founder, for $100. He is also our Promoter, as per regulation 404(c) of Regulation S-K. He will not receive anything of value from us, directly or indirectly, in his capacity as a promoter other than as disclosed in this prospectus. He advanced our company $13,015. The advance is evidenced by a promissory note dated 9/14/14. Involvement in Certain Legal Proceedings During the past ten years, none of the following occurred with respect to the directors and officers of the Company: (1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of any competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the SEC or the commodities futures trading commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated. Anti-Takeover Provisions The provisions of Delaware law, and restated bylaws, which are summarized below, may have the effect of delaying, deferring or discouraging another person from acquiring control of our company. They are also designed, in part, to encourage persons seeking to acquire control of us to negotiate first with our board of directors. We believe that the benefits of increased protection of our potential ability to negotiate with an unfriendly or unsolicited acquirer outweigh the disadvantages of discouraging a proposal to acquire us because negotiation of these proposals could result in an improvement of their terms. Code of Ethics Sierra Madre has adopted a Code of Ethics applicable to its directors and officers (including its principal executive officer and principal financial officer). Sierra s Code of Ethics is filed as an exhibit to this registration statement on Form S-1. Plan of Distribution This is a self-underwritten best-efforts offering. The Company plans on offering its securities to the public without the assistance of an underwriter. The Company through its CEO, Michael H. Brown, will distribute the stock by direct sale to qualified individuals and entities. There are no plans or arrangements to enter into any contracts or agreements to sell the shares with a broker or dealer. In offering the securities on our behalf, our directors will rely on the safe harbor from broker dealer registration set out in Rule 3a4-1 under the Securities Exchange Act of 1934. Our director will not register as a broker-dealer pursuant to Section 15 of the Securities Exchange Act of 1934, as amended ( Exchange Act ), in reliance upon Rule 3a4-1, which sets forth the conditions under which a person associated with an issuer, may participate in the offering of the issuer's securities and not be deemed to be a broker-dealer. The conditions are that: 1) The person is not statutorily disqualified, as that term is defined in Section 3(a)(39) of the Exchange Act, at the time of his participation; 2) The person is not compensated in connection with his or her participation by the payment of commissions or other remuneration based either directly or indirectly on transactions in securities; 3) The person is not at the time of their participation, an associated person of a broker-dealer; and 4) The person meets the conditions of Paragraph (a)(4)(ii) of Rule 3a4-1 of the Exchange Act, in that he or she (a) primarily performs, or is intended primarily to perform at the end of the offering, substantial duties for or on behalf of the issuer otherwise than in connection with transactions in securities; and (b) is not a broker or dealer, or an associated person of a broker or dealer, within the preceding 12 months; and (c) does not participate in selling and offering of securities for any issuer more than once every 12 months other than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii). Our CEO, Michael Brown, meets this qualification, and will sell shares on the company s behalf. He is not statutorily disqualified, is not being compensated for selling our stock, and is not associated with a broker-dealer. He is, and will continue to be our director at the end of this offering and has not currently and has not been during the last 12 months a broker-dealer or associated with a broker-dealer. They have not during the last 12 months and will not in the next 12 months offer or sell securities for another corporation. Procedures for Subscribing If you decide to subscribe for any shares in this Offering, you must: (i) execute and deliver a subscription agreement; and (ii) deliver a check, money order or certified funds to us for acceptance or rejection. The subscription agreement and subscription funds can be mailed, couriered or delivered in person. All checks, money orders or certified funds for subscriptions must be made payable to Sierra Madre Mining, Inc. The funds from all accepted subscriptions will be deposited into our corporate bank account, and will be used immediately by Sierra. Right to Reject Subscriptions We have the right to accept or reject subscriptions in whole or in part, for any reason or for no reason. All monies from rejected subscriptions will be returned immediately by us to the subscriber, without charge, deduction or interest. Subscriptions for securities will be accepted or rejected within 48 hours after we receive them. Section 15(g) of the Exchange Act - Penny Stock Disclosure Our shares are penny stock covered by Section 15(g) of the Securities Exchange Act of 1934 and Rules 15g-1 through 15g-6 promulgated under the Securities Exchange Act. They impose additional sales practice requirements on broker/dealers who sell such securities to persons other than established customers and accredited investors (generally institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouses). For transactions covered by these rules, the broker/dealer must make a special suitability determination for the purchase and have received the purchaser s written agreement to the transaction prior to the sale. Consequently, the rules may affect the ability of broker/dealers to sell our securities and also may affect your ability to resell your shares. Section 15(g) also imposes additional sales practice requirements on broker/dealers who sell penny stock. These rules require a one-page summary of certain essential items. The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important to an understanding of the function of the penny stock market, such as bid and offer quotes, a dealers spread and broker/dealer compensation; the broker/dealer compensation, the broker/dealer s duties to its customers, including the disclosures required by any other penny stock disclosure rules; the customers rights and remedies in cases of fraud in penny stock transactions; and the Financial Industry Regulatory Authority s toll-free telephone number and the central number of the North American Securities Administrators Association (NASAA), for information on the disciplinary history of broker/dealers and their associated persons. While Section 15(g) and Rules 15g-1 through 15g-6 apply to broker/dealers, they do not apply to us. Rule 15g-1 exempts a number of specific transactions from the scope of the penny stock rules. Rule 15g-2 declares unlawful broker/dealer transactions in penny stock unless the broker/dealer has first provided to the customer a standardized disclosure document. Rule 15g-3 provides that it is unlawful for a broker/dealer to engage in a penny stock transaction unless the broker/dealer first discloses and subsequently confirms to the customer current quotation prices or similar market information concerning the penny stock in question. Rule 15g-4 prohibits broker/dealers from completing penny stock transactions for a customer unless the broker/dealer first discloses to the customer the amount of compensation or other remuneration received as a result of the penny stock transaction. Rule 15g-5 requires that a broker/dealer executing a penny stock transaction, other than one exempt under Rule 15g-1, disclose to its customer, at the time of or prior to the transaction, information about the sales person s compensation. Rule 15g-6 requires broker/dealers selling penny stock to provide their customers with monthly account statements. The foregoing rules apply to broker/dealers. They do not apply to us in any manner whatsoever. The application of the penny stock rules may affect your ability to resell your shares because many brokers are unwilling to buy, sell or trade penny stock as a result of the additional sales practices imposed upon them which are described in this section. Regulation M We are subject to Regulation M of the Securities Exchange Act of 1934. Regulation M governs activities of underwriters, issuers, selling security holders and others in connection with offerings of securities. Regulation M prohibits distribution participants and their affiliated purchasers from bidding for, purchasing or attempting to induce any person to bid for or purchase the securities being distributed. OTC Bulletin Board Considerations There is currently no active public trading market for our shares of common stock, and we cannot give any assurance to you that the shares offered by this prospectus can be resold for at least the offered price if and when an active secondary market might develop, or that a public market for our shares will be sustained even if one is ultimately developed. The OTC Bulletin Board is separate and distinct from the Nasdaq stock market. Nasdaq has no business relationship with issuers of securities quoted on the OTC Bulletin Board. The SEC s order handling rules, which apply to Nasdaq-listed securities, do not apply to securities quoted on the OTC Bulletin Board. Although the Nasdaq stock market has rigorous listing standards to ensure the high quality of its issuers, and can delist issuers for not meeting those standards, the OTC Bulletin Board has no listing standards. Rather, it is the market maker who chooses to quote a security on the system and is obligated to comply with keeping information about the issuer in its files. The only requirement for inclusion in the OTC Bulletin Board is that the issuer be current in its periodic reporting requirements with the SEC. Investors may have greater difficulty in getting orders filled on the OTC Bulletin Board rather than on Nasdaq. Investors orders may be filled at a price much different than expected when an order is placed. Trading activity in general is not conducted as efficiently and effectively as with Nasdaq-listed securities. Investors must contact a broker/dealer to trade OTC Bulletin Board securities. Investors do not have direct access to the OTC Bulletin Board service. For OTC Bulletin Board securities, there only has to be one market maker. OTC Bulletin Board transactions are conducted almost entirely manually. Because there are no automated systems for negotiating trades on the OTC Bulletin Board, they are conducted via telephone. In times of heavy market volume, the limitations of this process may result in a significant increase in the time it takes to execute investor orders. Therefore, when investors place market orders (an order to buy or sell a specific number of shares at the current market price) it is possible for the price of a stock to go up or down significantly during the lapse of time between placing a market order and execution of such order. Because OTC Bulletin Board stocks are usually not followed by analysts, there may be lower trading volume than for Nasdaq-listed securities. DESCRIPTION OF SECURITIES Class A & Class B Stock The authorized capital stock of Sierra Madre Mining, Inc consists of 3,000,000,000 total authorized shares, of which there are 10,000,000 total Class A shares, and 2,990,000,000 Class B shares. The par value is $0.000001 per share. As of the date of this prospectus, 127,300,000 shares have been issued. This offering is for our Class B stock. The holders of our Class B stock: have equal ratable rights to dividends from funds legally available if and when declared by our board of directors; are entitled to share ratably in all of our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of our affairs; do not have preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights; and Are not entitled to voting on any matters which voting-class shares are entitled to vote. Voting Rights Each holder of Class A stock entitles the holder to one (1) vote on each matter submitted to a vote of our shareholders, including the election of Directors. There is no cumulative voting. Each holder of Class B common stock is not entitled to voting on any matters concerning the corporation. Dividend Policy The Company does not intend to declare dividends in the foreseeable future but rather intends to use any future earnings for the development of its business. Options As of 9/30/14 we had stock options to purchase an aggregate of 19,000,000 shares of our Class B stock, with an average exercise price of $.01 for Lacome, under our equity compensation plans. Warrants We have no warrants to purchase shares of our common stock or any other of our securities outstanding as of the date of this Prospectus. Registration Rights The Company is not a party to any registration rights agreements. Convertible Securities We have not issued and do not have outstanding any securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our stock. SHARES ELIGIBLE FOR FUTURE SALE Prior to this offering, there has been no public market for our common stock. Future sales of substantial amounts of our common stock in the public market, or the perception that such sales may occur, could adversely affect the prevailing market price of our common stock. No prediction can be made as to the effect, if any, future sales of shares, or the availability of shares for future sales, will have on the market price of our common stock prevailing from time to time. The sale of substantial amounts of our common stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of our common stock. No shares held by our "affiliates" (officers, directors or 10% shareholders) are being registered hereunder. Our issued and outstanding shares have are subject to the sale limitations imposed by Rule 144. Under Rule 144, since our Directors are affiliates as defined in that rule, the shares can be publicly sold, subject to volume restrictions and restrictions on the manner of sale, commencing one year after their acquisition. F-2 SIERRA MADRE MINING, INC. (AN EXPLORATION STAGE COMPANY) STATEMENT OF OPERATIONS For the period January 1, 2014 to September 30, 2014 For the period November 6, 2013 (Inception)to December 31, 2013 For the period November 6, 2013 (Inception)to September 30, 2014 (Audited) (Audited) (Audited) Revenues $ 0 $ 0 $ 0 Cost of Sales 0 0 0 Gross Profit 0 0 0 Operating Expenses 19,681 9,134 28,815 Net Income(Loss) from Operations (19,681) (9,134) (28,815) Other Income (Expense) 0 0 0 Net Income(Loss) Before Provision for Income Taxes (19,681) (9,134) (28,815) Provision for income taxes 0 0 0 Net Income(Loss) $ (19,681) $ (9,134) $ (28,815) Basic and Diluted Loss Per Share (0.00) (0.00) Weighted average number of shares outstanding 115,884,444 101,527,273 "The accompanying notes are an integral part of these financial statements" SIERRA MADRE MINING, INC. STATEMENT OF STOCKHOLDER'S EQUITY (AN EXPLORATION STAGE COMPANY) FOR THE PERIOD ENDED NOVEMBER 6, 2013(INCEPTION), THROUGH SEPTENBER 30, 2014 (Audited) Common Stock Class A Common Stock Class A Common Stock Class B Common Stock Class B Accumulated Shares Amount Shares Amount ACIP Deficit Total Initial Balances November 1, 2013(inception) 0 $ 0 0 $ 0 $ 0 $ $ 0 $ 0 Capital stock issuance 5,000,000 5 97,000,000 97 1,998 0 2,100 Net Income(loss) 11/1/2013 to 12/31/2013 0 0 0 0 0 (9,134) (9,134) Balances December 31, 2013 5,000,000 $ 5 97,000,000 $ 97 $ 1,998 $ $ (9,134) $ (7,034) Capital stock issuance 0 0 25,300,000 25 60,175 0 60,200 Net Income(loss) 1/1/2014 to 9/30/2014 0 0 0 0 0 (19,681) (19,681) Balances September 30, 2014 5,000,000 $ 5 122,300,000 $ 122 $ 62,173 $ $ (28,815) $ 33,485 "The accompanying notes are an integral part of these financial statements" F-6 SIERRA MADRE MINING, INC. (AN EXPLORATION STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS September 30, 2014 Note 1. Organization, History and Business Sierra Madre Mining, Inc. ( the Company ) was incorporated in Delaware on November 6, 2013. Its fiscal year end is December 31st. The Company is in the business of mining for precious metals. It is currently an exploration stage company as set forth in Securities and Exchange Commission (SEC) Industry Guide 7 and, accordingly, expenses all exploration costs until proven and probable reserves are established. Note 2. Summary of Significant Accounting Policies Revenue Recognition Revenue is derived from sales of products to distributors and consumers. Revenue is recognized in accordance with Staff Accounting Bulletin ( SAB ) No. 101, Revenue Recognition in Financial Statements, as revised by SAB No. 104. As such, the Company recognizes revenue when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable, and collectability is probable. Sales are recorded net of sales discounts and terms are recorded by contract. Accounts Receivable Accounts receivable is reported at the customers outstanding balances, less any allowance for doubtful accounts. Interest is not accrued on overdue accounts receivable. Allowance for Doubtful Accounts An allowance for doubtful accounts on accounts receivable is charged to operations in amounts sufficient to maintain the allowance for uncollectible accounts at a level management believes is adequate to cover any probable losses. Management determines the adequacy of the allowance based on historical write-off percentages and information collected from individual customers. Accounts receivable are charged off against the allowance when collectability is determined to be permanently impaired. Stock Based Compensation When applicable, the Company will account for stock-based payments to employees in accordance with ASC 718, Stock Compensation ( ASC 718 ). Stock-based payments to employees include grants of stock, grants of stock options and issuance of warrants that are recognized in the consolidated statement of operations based on their fair values at the date of grant. The Company accounts for stock-based payments to non-employees in accordance with ASC 505-50, Equity-Based Payments to Non-Employees. Stock-based payments to non-employees include grants of stock, grants of stock options and issuances of warrants that are recognized in the consolidated statement of operations based on the value of the vested portion of the award over the requisite service period as measured at its then-current fair value as of each financial reporting date. The Company calculates the fair value of option grants and warrant issuances utilizing the Binomial pricing model. The amount of stock-based compensation recognized during a period is based on the value of the portion of the awards that are ultimately expected to vest. ASC 718 requires forfeitures to be estimated at the time stock options are granted and warrants are issued to employees and non-employees, and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The term forfeitures is distinct from cancellations or expirations and represents only the unvested portion of the surrendered stock option or warrant. The Company estimates forfeiture rates for all unvested awards when calculating the expense for the period. In estimating the forfeiture rate, the Company monitors both stock option and warrant exercises as well as employee termination patterns. The resulting stock-based compensation expense for both employee and non-employee awards is generally recognized on a straight-line basis over the period in which the Company expects to receive the benefit, which is generally the vesting period. Loss per Share The Company reports earnings (loss) per share in accordance with ASC Topic 260-10, "Earnings per Share." Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Diluted earnings (loss) per share has not been presented since there are no dilutive securities. Cash and Cash Equivalents For purpose of the statements of cash flows, the Company considers cash and cash equivalents to include all stable, highly liquid investments with maturities of three months or less. Organization and Offering Cost The Company has a policy to expense organization and offering cost as incurred. To date for period November 6, 2013(inception) through September 30, 2014 the Company has incurred $229 in organization cost and $3,500 in offering cost. Election to be treated as an emerging growth company: For the five year period starting in the first quarter of 2015, Sierra Madre Mining, Inc. if continuing eligibility applies has elected to use the extended transition period now available for complying with new or revised accounting standards under Section 102(b) (1). This election allows the Company to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of the Company still being eligible, the financial statements may not be comparable to companies that comply with public company effective dates. Concentration of Credit Risk The Company primarily transacts its business with one financial institution. The amount on deposit in that one institution may from time to time exceed the federally-insured limit. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Business segments ASC 280, Segment Reporting requires use of the management approach model for segment reporting. The management approach model is based on the way a company s management organizes segments within the company for making operating decisions and assessing performance. The Company determined it has one operating segment as of September 30, 2014. Income Taxes The Company accounts for its income taxes under the provisions of ASC Topic 740, Income Taxes. The method of accounting for income taxes under ASC 740 is an asset and liability method. The asset and liability method requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between tax bases and financial reporting bases of other assets and liabilities. Recent Accounting Pronouncements The Company continually assesses any new accounting pronouncements to determine their applicability to the Company. Where it is determined that a new accounting pronouncement affects the Company s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and assures that there are proper controls in place to ascertain that the Company s financials properly reflect the change. The Company currently does not have any recent accounting pronouncements that they are studying and feel may be applicable. Note 3. Income Taxes Deferred income tax assets and liabilities are computed annually for differences between financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities. The effective tax rate on the net loss before income taxes differs from the U.S. statutory rate as follows: 9/30/2014 12/31/2013 U.S statutory rate 34.00% 34.00% Less valuation allowance -34.00% -34.00% Effective tax rate 0.00% 0.00% The significant components of deferred tax assets and liabilities are as follows: 9/30/2014 12/31/2013 Deferred tax assets Net operating losses $ (28,815) $ (9,134) Deferred tax liability Net deferred tax assets (9,797) (3,106) Less valuation allowance 9,797 3,106 Deferred tax asset - net valuation allowance $ 0 $ 0 On an interim basis, the Company has a net operating loss carryover of approximately $1,789 available to offset future income for income tax reporting purposes, which will expire in various years through 2032, if not previously utilized. However, the Company s ability to use the carryover net operating loss may be substantially limited or eliminated pursuant to Internal Revenue Code Section 382. The Company adopted the provisions of ASC 740-10-50, formerly FIN 48, and Accounting for Uncertainty in Income Taxes . The Company had no material unrecognized income tax assets or liabilities as of September 30, 2014. The Company s policy regarding income tax interest and penalties is to expense those items as general and administrative expense but to identify them for tax purposes. During the period November 6, 2013(inception) through September 30, 2014, there were no income tax, or related interest and penalty items in the income statement, or liabilities on the balance sheet. The Company files income tax returns in the U.S. federal jurisdiction and Nevada state jurisdiction. We are not currently involved in any income tax examinations. Note 4. Related Party Transactions Related Party Stock Issuances: The following stock issuances were made to officers of the company as compensation for services: On 11/7/13 the Company issued 100,000,000 of stock to Joseph Lacome as Founder s Shares, for $100. It consisted of 5,000,000 class A & 95,000,000 class B shares. On 6/13/14, the Company issued 10,000,000 of its authorized common stock class B shares to Michael Brown in exchange for director s services. The fair market value of services was $10,200. On 5/15/14 issued 15,000,00 shares of Class B stock for the purchase of a 20% ownership interest in 200 lode mining claims in Mohave County, Arizona. The shares were issued to individual members of AJA Mining, LLC & Gold Basin Mining, LLC. Additionally, the company currently has no cash account and has funded operations to this point through the issuance of common stock as well as short term loans from a related party. These loans are due on demand, carry a zero percent interest rate and the balance owed by the Company at September 30, 2014 was $13,015. Note 5. Stockholders Equity Class A Stock The total number of Class A shares authorized that may be issued by the Company is 10,000,000 shares with a par value of $0.000001 per share. As of 9/30/14, 5,000,000 Class A shares have been issued. The holders of the Company's common stock class A are entitled to one vote per share of common stock held. Class B Common Stock The total number of Class B common shares authorized that may be issued by the Company is 2,990,000,000 shares with a par value of $0.000001 per share. As of September 30, 2014 the Company had 122,300,000 shares of class B shares issued and outstanding. As of September 30, 2014 there were 127,300,000 shares of class A & B issued and outstanding. Note 6. Commitments and Contingencies Commitments: The Company currently has no long term commitments as of our balance sheet date. Contingencies: None as of our balance sheet date. Note 7 Net Income(Loss) Per Share The following table sets forth the information used to compute basic and diluted net income per share attributable to Sierra Madre Mining, Inc. for the period November 6, 2013(inception) through September 30, 2014: 30-Sep-14 31-Dec-13 Net Income (Loss) $ (19,681) $ (9,134) Weighted-average common shares outstanding basic: Weighted-average common stock 115,884,444 101,527,273 Equivalents Stock options 0 0 Warrants 0 0 Convertible Notes 0 0 Weighted-average common shares outstanding- Diluted 115,884,444 101,527,273 Note 8. Notes Payable Notes payable consist of the following for the periods ended; 9/30/2014 12/31/2013 Officer related party working capital notes with no stated interest rate. Note is payable on demand. $ 13,015 $ 7,034 Total Notes Payable 13,015 7,034 Less Current Portion (13,015) (7,034) Long Term Notes Payable $ 0 $ 0 Note 9. Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Currently, the Company has no operating history and has incurred operating losses, and as of September 30, 2014 the Company had a working capital deficit of $16,515 and an accumulated deficit of $28,815. These factors raise substantial doubt about the Company s ability to continue as a going concern. Management believes that the Company s capital requirements will depend on many factors including the success of the Company s development efforts and its efforts to raise capital. Management also believes the Company needs to raise additional capital for working capital purposes. There is no assurance that such financing will be available in the future. The conditions described above raise substantial doubt about our ability to continue as a going concern. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. Note 10. Subsequent Events The Company is currently in the process of registering 100,000,000 Class B shares through an S-1 registration and expects this registration to become effective at some point during the current fiscal year. F-7 LEGAL PROCEEDINGS There are no pending or threatened lawsuits against us. TRANSFER AGENT Our transfer agent is Cathedral Stock Transfer, LLC, 800 W. Fifth Ave Suite 201a, Naperville, IL 60563 INTERESTS OF NAMED EXPERTS AND COUNSEL Joseph Lacome has given his opinion as attorney-at-law regarding the validity of the issuance of the Shares offered by the Company. He has also given legal advice on company business matters, wrote our Prospectus, and is a Director of the company. As of the date of this prospectus, he beneficially owns 100,000,000 shares of our Class A & B stock. Our financial statements included in this prospectus and the registration statement have been audited by John Scrudato CPA, 7 Valley View Drive, Califon NJ 07830 to the extent and for the periods set forth in their report appearing elsewhere in this prospectus and in the registration statement filed with the SEC, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED 12/22/14 THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. PROSPECTUS SIERRA MADRE MINING, Inc. OFFERED BY SIERRA MADRE MINING, INC. Offering Made Without an Underwriter Class B shares to be sold carry no voting rights See the Section Offering-Plan of Distribution in the Prospectus This offering is self-underwritten and conducted on a Best Efforts No Minimum basis and will end one year from the date that the registration statement is effective. No arrangement has been made to escrow funds received from the stock sales pending the completion of the offering. In that regard, proceeds from sales of the common stock will be delivered directly to the Company as sales occur. Directly funding the Company from the common stock sales exposes investors to significant risks as disclosed further in the section The Offering-Plan of Distribution. Because the offering has no set minimum and there is no plan to escrow the offering proceeds, the Company may fail to raise enough capital to fund its business plan and operations and it s possible that investors may lose substantially all of their investment. No underwriter or person has been engaged to facilitate the sale of shares of common stock in this offering. There are no underwriting commissions involved in this offering. The Company does not intend to sell any specific minimum number or dollar amount of securities but will use its best efforts to sell the securities offered. A Total of Up to 100,000,000 Shares of Class B Stock Par Value $ 0.000001 per Share Offered at $.25 (a quarter) Per Share OUR COMMON STOCK IS NOT TRADED ON ANY NATIONAL SECURITIES EXCHANGE AND IS NOT QUOTED ON ANY OVER-THE-COUNTER MARKET. THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD PURCHASE SHARES ONLY IF YOU CAN AFFORD A COMPLETE LOSS OF YOUR INVESTMENT. SEE RISK FACTORS FOR A DISCUSSION OF RISKS APPLICABLE TO US AND AN INVESTMENT IN OUR COMMON STOCK. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. TABLE OF CONTENTS Page Prospectus Summary 3
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+S-1 1 d769078ds1.htm S-1 S-1 Table of Contents AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 12, 2014 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AZURE MIDSTREAM PARTNERS, LP (Exact Name of Registrant as Specified in Its Charter) Delaware 4922 38-3941102 (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 12377 Merit Drive, Suite 300 Dallas, Texas 75251 (972) 674-5200 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant s Principal Executive Offices) Eric T. Kalamaras Chief Financial Officer 12377 Merit Drive, Suite 300 Dallas, Texas 75251 (972) 674-5200 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) Copies to: Douglas E. McWilliams Jeffrey K. Malonson Vinson & Elkins L.L.P. 1001 Fannin Street, Suite 2500 Houston, Texas 77002 (713) 758-2222 Joshua Davidson Andrew J. Ericksen Baker Botts L.L.P. 910 Louisiana Street Houston, Texas 77002 (713) 229-1234 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Proposed Maximum Aggregate Offering Price(1)(2) Amount of Registration Fee Common units representing limited partner interests $175,000,000 $20,335 (1) Includes common units issuable upon exercise of the underwriters option to purchase additional common units. (2) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o). The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents TABLE OF CONTENTS SUMMARY 1
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+PROSPECTUS SUMMARY
+
+ 
+
+AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, WE, US, OUR, AND DINEX CORP. REFERS TO DINEX CORP. THE FOLLOWING SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK.
+
+ 
+
+DINEX CORP.
+
+ 
+
+We are a development stage company and we plan open a recording studio in Ecuador. Dinex Corp. was incorporated in Nevada on July 22, 2013. We intend to use the net proceeds from this offering to develop our business operations (See Description of Business and Use of Proceeds ). To implement our plan of operations we require a minimum of $50,000 for the next twelve months as described in our Plan of Operations. We expect our operations to begin to generate revenues during months 8-12 after completion of this offering. However, there is no assurance that we will generate any revenue in the first 12 months after completion our offering or ever generate any revenue.
+
+Being a development stage company, we have very limited operating history. If we do not generate any revenue we may need a minimum of $10,000 of additional funding to pay for ongoing SEC filing requirements. We do not currently have any arrangements for additional financing. Our principal executive offices are located at Renato Rivera, Av. Pampite urb. La Comarca, Acuario 2b, Quito, Pichincha, Ecuador. Our phone number is (702) 605-4710. 
+
+From inception (July 22, 2013) until the date of this filing, we have had limited operating activities. Our financial statements from inception (July 22, 2013) through October 31, 2014, reports no revenues and a net loss of $623. Our independent registered public accounting firm has issued an audit opinion for Dinex Corp. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. To date, we have established our company, developed our business plan and are looking for the potential clients to record their music and songs. 
+
+As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. 
+
+Proceeds from this offering are required for us to proceed with your business plan over the next twelve months. We require minimum funding of approximately $50,000 to conduct our proposed operations and pay all expenses for a minimum period of one year including expenses associated with this offering and maintaining a reporting status with the SEC. If we are unable to obtain minimum funding of approximately $50,000, our business may fail. We do not anticipate earning revenues until we enter into commercial operation. Since we are presently in the development stage of our business, we can provide no assurance that we will successfully sell any products or services related to our planned activities.
+
+5 | 
+
+THE OFFERING
+
+The Issuer:
+
+ 
+
+DINEX CORP.
+
+Securities Being Offered:
+
+ 
+
+5,000,000 shares of common stock.
+
+Price Per Share:
+
+ 
+
+$0.02
+
+Duration of the Offering:
+
+ 
+
+The shares will be offered for a period of one hundred and eighty (180) days from the effective date of this prospectus. The offering shall terminate on the earlier of (i) when the offering period ends (180 days from the effective date of this prospectus), (ii) the date when the sale of all 5,000,000 shares is completed, (iii) when the Board of Directors decides that it is in the best interest of the Company to terminate the offering prior the completion of the sale of all 5,000,000 shares registered under the Registration Statement of which this Prospectus is part. 
+
+ 
+
+Gross Proceeds
+
+ 
+
+$100,000
+
+Securities Issued and Outstanding:
+
+There are 5,000,000 shares of common stock issued and outstanding as of the date of this prospectus, held by our sole officer and director, Dina Makarchik. 
+
+If we are successful at selling all the shares in this offering, we will have 10,000,000 shares issued and outstanding.
+
+Subscriptions
+
+All subscriptions once accepted by us are irrevocable.
+
+Registration Costs
+
+We estimate our total offering registration costs to be approximately $8,000.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001622567_terryville_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001622567_terryville_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..e1b1d0cb7b207a5c30e22287f35b32b1d1110f12
--- /dev/null
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@@ -0,0 +1 @@
+This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before investing in our common units. You should read the entire prospectus carefully, including the historical carve-out financial statements and the notes to those financial statements, before investing in our common units. The information presented in this prospectus assumes an initial public offering price of $ per common unit (the mid-point of the price range set forth on the cover page of this prospectus) and, unless otherwise indicated, that the underwriters option to purchase additional common units is not exercised. You should read Risk Factors for information about important risks that you should consider before buying our common units. Our proved reserves as of September 30, 2014 have been prepared by Netherland, Sewell & Associates, Inc., our independent reserve engineers ( NSAI ), which are reflected in our reserve report (our reserve report ), a summary of which is included as Appendix C of this prospectus. Our proved reserves as of December 31, 2013 have been prepared by our internal reserve engineers. Our proved reserves and production presented in this prospectus on a gas-equivalent basis are done so using a conversion of 6 Mcf equivalent per barrel of oil or NGL. This conversion is based on energy equivalence and not price equivalence. References in this prospectus to our initial assets refer to the overriding royalty interests in horizontal producing wells and in adjacent undeveloped acreage that will be contributed to us by Memorial Resource in connection with the closing of this offering. These overriding royalty interests have been carved out of and burden Memorial Resource s working interests in certain natural gas, NGL and oil properties in the Terryville Complex in North Louisiana and will remain in effect until the associated leases expire. We include a glossary of some of the terms used in this prospectus as Appendix B. Terryville Mineral & Royalty Partners LP
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diff --git a/parsed_sections/prospectus_summary/2014/COMM_commscope_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/COMM_commscope_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..7ac73052f9d0bdf4d77e43298d69a4006ec20ea9
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. Because this is only a summary, it does not contain all of the information that may be important to you. You should read this entire prospectus and should consider, among other things, the matters set forth under Risk Factors, Selected Historical Financial Information and Management s Discussion and Analysis of Financial Condition and Results of Operations, and our financial statements and related notes thereto appearing elsewhere in this prospectus before making your investment decision. On January 14, 2011, CommScope Holding Company, Inc. acquired the equity of CommScope, Inc. through the merger of Cedar I Merger Sub, Inc. with and into CommScope, Inc., which is referred to herein as the Acquisition. We refer to the Acquisition and the financing thereof as the Acquisition Transactions. CommScope, Inc., a Delaware corporation, is a direct wholly owned subsidiary of CommScope Holding Company, Inc., or CommScope Holdings, a Delaware corporation. References herein to the Company, we, us, our and our company refer to (i) CommScope, Inc. and its consolidated subsidiaries prior to the Acquisition and (ii) CommScope Holding Company, Inc. and its consolidated subsidiaries following the Acquisition. References herein to the LTM Period refer to our unaudited results for the twelve months ended March 31, 2014. References herein to the financial measures Adjusted Operating Income, Adjusted EBITDA, Adjusted Net Income and Adjusted EPS refer to financial measures that do not comply with generally accepted accounting principles in the United States, or U.S. GAAP. For information about how we calculate Adjusted Operating Income, Adjusted Net Income, Adjusted EBITDA and Adjusted EPS, see Note 6 to the table under the heading Summary Historical Audited and Unaudited Consolidated Financial Information. CommScope Overview We are a leading global provider of connectivity and essential infrastructure solutions for wireless, business enterprise and residential broadband networks. We help our customers solve communications challenges by providing critical radio frequency, or RF, solutions, intelligent connectivity and cabling platforms, data center and intelligent building infrastructure and broadband access solutions. Demand for our offerings is driven by the rapid growth of data traffic and need for bandwidth from the continued adoption of smartphones, tablets, machine-to- machine communication and the proliferation of data centers, Big Data, cloud-based services and streaming media content. Our solutions are built upon innovative RF technology, service capabilities, technological expertise and intellectual property, including approximately 2,600 patents and patent applications worldwide. We have a team of approximately 14,500 people to serve our customers in over 100 countries through a network of more than 20 world-class manufacturing and distribution facilities strategically located around the globe. The following table sets forth our solutions, key products and services and global leadership positions across our Wireless, Enterprise and Broadband segments. The information in this preliminary prospectus is not complete and may be changed. The selling stockholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus dated June 2, 2014 PROSPECTUS 15,000,000 Shares CommScope Holding Company, Inc. Common Stock The selling stockholder named in this prospectus, an affiliate of The Carlyle Group, or Carlyle, is offering 15,000,000 shares of our common stock in this offering. We will not receive any proceeds from the sale of our common stock by the selling stockholder. Our common stock is listed on the NASDAQ Global Select Market, or Nasdaq, under the symbol COMM. On May 30, 2014, the closing sale price of our common stock as reported on Nasdaq was $26.44 per share. Investing in the common stock involves risks that are described in the Risk Factors section beginning on page 18 of this prospectus. Per Share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to the selling stockholder $ $ (1) We have agreed to reimburse the underwriters for certain expenses in connection with this offering. In addition, upon completion of this offering, we will pay a fee for certain financial consulting services to a broker-dealer not part of the underwriting syndicate. See Underwriting. The underwriters may also purchase up to an additional 2,250,000 shares from the selling stockholder, at the public offering price, less the underwriting discount, within 30 days from the date of this prospectus. We will not receive any of the proceeds from the sale of shares by the selling stockholder in this offering, including from any exercise by the underwriters of their option to purchase additional shares. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The shares will be ready for delivery on or about , 2014. J.P. Morgan Deutsche Bank Securities BofA Merrill Lynch Barclays Credit Suisse Goldman, Sachs & Co. Jefferies Morgan Stanley RBC Capital Markets Wells Fargo Securities Allen & Company LLC Evercore Raymond James Mizuho Securities SMBC Nikko Drexel Hamilton The date of this prospectus is , 2014. MARKET AND INDUSTRY DATA This prospectus includes estimates regarding market and industry data and forecasts, which are based on publicly available information, industry publications and surveys, reports from government agencies, reports by market research firms and our own estimates based on our management s knowledge of and experience in the market sectors in which we compete. The Gartner report described herein represents data, research, opinions or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. and are not representations of fact. Each Gartner report speaks as of its original publication date (and not as of the date of this prospectus) and the opinions expressed in such report are subject to change without notice. TRADEMARKS We own or otherwise have rights to the trademarks, copyrights and service marks, including those mentioned in this prospectus, used in conjunction with the marketing and sale of our products and services. This prospectus includes trademarks, such as CommScope, Andrew, SYSTIMAX and Uniprise, which are protected under applicable intellectual property laws and are our property and/or the property of our subsidiaries. This prospectus also contains trademarks, service marks, copyrights and trade names of other companies, which are the property of their respective owners. We do not intend our use or display of other companies trademarks, service marks, copyrights or trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Solely for convenience, our trademarks and tradenames referred to in this prospectus may appear without the or symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks and tradenames. OUR INITIAL PUBLIC OFFERING In October 2013, we issued and sold 30,769,230 shares of our common stock and Carlyle sold 10,913,983 shares of our common stock at a price of $15.00 per share in our initial public offering, or the IPO. Upon the completion of the IPO, our common stock was listed on Nasdaq under the symbol COMM. SECONDARY OFFERING On April 2, 2014, we closed a secondary public offering, in which Carlyle sold 17,500,000 shares of our common stock at a price of $22.00 per share. In addition, the underwriters exercised their option to purchase 2,625,000 additional shares of our common stock from Carlyle. We did not receive any proceeds from the sale of shares of our common stock by Carlyle. Our customers include substantially all of the leading global wireless operators as well as thousands of enterprise customers, including many Fortune 500 enterprises, and leading cable television providers or multi-system operators, or MSOs, which we serve both directly and indirectly. Major customers and distributors include companies such as Anixter International Inc., or Anixter, AT&T Inc., Ooredoo, Verizon Communications Inc., Ericsson Inc., Alcatel-Lucent SA, Graybar Electric Company Inc., Comcast Corporation, T-Mobile US, Inc. and Huawei Technologies Co., Ltd. Our market leadership, as well as our diversified customer base, market exposure and product and geographic mix, provide a strong and resilient business model with strong cash flow generation. In 2013, we generated net sales of $3,480.1 million, net income of $19.4 million, Adjusted Operating Income of $620.1 million and Adjusted Net Income of $262.1 million. During the LTM Period, we generated net sales of $3,610.5 million, net income of $68.0 million, Adjusted Operating Income of $679.8 million and Adjusted Net Income of $302.4 million, and our net sales were 58% from North America, 20% from the Europe, Middle East and Africa, or EMEA, region, 15% from the Asia and Pacific, or APAC, region and 7% from the Central and Latin America, or CALA, region. Product Summary Our product and solution offerings include: Cell site solutions: Our cell site solutions can be found at wireless tower sites and on rooftops and include base station antennas, microwave antennas, hybrid fiber-feeder and power cables, coaxial cables, connectors, power amplifiers, filters and backup power solutions, including fuel cells. Small cell DAS solutions: Our small cell distributed antenna systems, or DAS, solutions are primarily composed of distributed antenna systems that allow wireless operators to increase spectral efficiency, thereby extending and enhancing cellular coverage and capacity in challenging network conditions. Intelligent enterprise infrastructure solutions: Our Enterprise solutions include optical fiber and twisted pair structured cable solutions, intelligent infrastructure software, network rack and cabinet enclosures, intelligent building sensors, advanced LED lighting control systems and network design services. Data center solutions: We have complemented our leading physical layer solution offerings with the addition of iTRACS, LLC, or iTRACS, a leading provider of data center infrastructure management, or DCIM, software, with unique network intelligence capabilities. Broadband MSO solutions: We provide a broad portfolio of cable solutions including fiber-to-the-home equipment and headend solutions for MSOs. Industry Background We participate in the large and growing global market for connectivity and essential communications infrastructure. This market is being driven by the growth in bandwidth demand associated with the continued adoption of smartphones, tablets, machine-to-machine communication and the proliferation of data centers, Big Data, cloud-based services and streaming media content. Carrier Investments in 4G Wireless Infrastructure Wireless operators have started deploying LTE globally and are making the necessary wireless infrastructure investments to accommodate the growing demand for next-generation mobile communication services. A December 2013 Gartner, Inc. report estimates that mobile infrastructure spending for LTE was $5.9 billion worldwide in 2012 and is forecasted to reach $28.8 billion by 2016, a compound annual growth rate, or CAGR, of 49%. TABLE OF CONTENTS Page Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/FIVN_five9-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/FIVN_five9-inc_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..912ce59fb93e154f5eb95b0e6c9f383a9665fdac
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights selected information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read the entire prospectus, including the consolidated financial statements and the related notes included in this prospectus and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Unless the context requires otherwise, the words Five9, we, company, us and our refer to Five9, Inc. and its subsidiaries. Overview Five9 is a pioneer and leading provider of cloud software for contact centers. Since our inception, we have exclusively focused on delivering our platform in the cloud and are disrupting a significantly large market by replacing legacy on-premise contact center systems. Our mission is to empower organizations to transform their contact centers into customer engagement centers of excellence, while improving business agility and significantly lowering the cost and complexity of their contact center operations. Our purpose-built, highly scalable and secure Virtual Contact Center, or VCC, cloud platform delivers a comprehensive suite of easy-to-use applications that enable the breadth of contact center-related customer service, sales and marketing functions. We facilitate over three billion interactions between our more than 2,000 clients and their customers per year and believe our ability to combine software and telephony into a single unified platform that is delivered in the cloud creates a significant barrier to entry. Our solution, which is comprised of our VCC cloud platform and applications, allows simultaneous management and optimization of customer interactions across voice, chat, email, web, social media and mobile channels, either directly or through our application programming interfaces. Our VCC cloud platform matches each customer interaction with an appropriate agent resource and delivers relevant customer data to the agent in real-time through integrations with adjacent enterprise applications, such as customer relationship management software, to optimize the customer experience and improve agent productivity. Delivered on-demand, our solution enables our clients to quickly deploy agent seats in any geographic location with only a computer, headset and broadband internet connection, and rapidly adjust the number of contact center agent seats in response to changing business requirements. Unlike legacy on-premise contact center systems, our solution requires minimal up-front investment, can be rapidly deployed and is maintained by us in the cloud. Our sales model consists of a field sales team that sells our solution into larger opportunities and a telesales team that sells our solution into smaller opportunities. We have developed a proven, high velocity, metrics-driven sales and marketing strategy designed to effectively identify, qualify and close sales opportunities. We have also developed a large ecosystem of technology and system integrator partners to help increase awareness of our solution in the market and drive incremental sales opportunities with new and existing clients. We provide our solution through a Software-as-a-Service, or SaaS, business model with recurring subscriptions based primarily on the number of agent seats and minutes of usage of our VCC cloud platform, as well as the specific functionalities and applications our clients deploy. Our recurring revenue model combined with strong revenue retention have enhanced our ability to forecast our financial performance and plan future investments. We have achieved significant growth in recent periods. For the years ended December 31, 2011, 2012 and 2013, our revenues were $43.2 million, $63.8 million and $84.1 million, respectively, representing year-over-year growth of 48% and 32%, respectively. We incurred net losses of $7.9 million, $19.3 million and $31.3 million for the years ended December 31, 2011, 2012 and 2013, respectively, as a result of increased investment in our growth. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion, dated April 3, 2014 Prospectus 10,000,000 Shares Common Stock This is the initial public offering of common stock by Five9, Inc. We are offering 10,000,000 shares of common stock. The estimated initial public offering price is between $9.00 and $11.00 per share. Currently, no public market exists for the shares. We have applied to list our shares of common stock on The NASDAQ Stock Market under the symbol FIVN. We are an emerging growth company as defined under the federal securities laws. Investing in our common stock involves risks. See Risk Factors beginning on page 11 of this prospectus. Per Share Total Initial public offering price $ $ Underwriting discounts(1) $ $ Proceeds to us (before expenses) $ $ (1) Please see Underwriting for a description of the compensation payable to the underwriters. We have granted the underwriters a 30-day option to purchase up to an additional 1,500,000 shares of our common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares on or about , 2014. J.P. Morgan Barclays BofA Merrill Lynch Pacific Crest Securities Canaccord Genuity Needham & Company Prospectus dated , 2014 Table of Contents Industry Overview Contact centers must evolve in today s rapidly changing technology environment Contact centers are vital hubs of interaction between organizations and their customers and are mission critical to the successful execution of customer service, sales and marketing strategies. Today, customers increasingly expect seamless and personalized communications across multiple channels, including voice, chat, email, web, social media and mobile. In addition, organizations seek to enhance the efficiency of their contact centers by managing agent utilization and unifying geographically dispersed operations. In order to meet these changing demands, contact centers must upgrade their existing on-premise contact center systems or migrate their contact center operations to the cloud. Legacy on-premise contact center systems are inefficient The majority of contact center operations today rely on legacy on-premise contact center systems that include business workflows, as well as hardware and software architectures designed more than a decade ago. Key shortcomings of these legacy systems include: Long and complex implementation and upgrade cycles. Implementation and upgrades of legacy on-premise contact center systems require long deployment timelines and complex integrations with other enterprise systems, which frequently result in significant expenditures of time, resources and capital; Inflexible resource deployment. Most legacy on-premise contact center systems do not provide the flexibility to easily manage remote agents and quickly adjust agent seats to accommodate peak call volumes. As a result, organizations are typically unable to quickly scale their contact center operations in response to changing business needs; and Duplicative technology stacks across multiple sites. Organizations must integrate multiple contact center sites to drive efficiency and create a unified customer view. However, the use of legacy on-premise contact center systems often results in dissimilar solutions at each site and integration of these contact center sites requires significant ongoing investment. Our Opportunity Based on our current product offerings and historical average annual recurring revenue per seat, we believe that the market for our solution is approximately $22 billion annually worldwide. Gartner estimates that there were 14.5 million contact center agents worldwide in 2012 and forecasts that the cloud penetration of the contact center market in North America will more than double from 5% of total contact center agents in 2012 to 13% in 2016. We believe the adoption of cloud contact center software solutions is increasing rapidly as a result of several distinct trends. The increasing adoption of cloud computing, especially within customer relationship management, or CRM, is creating strong demand for integrated cloud contact center software solutions. Cloud contact center software solutions now offer the functionality required by large, complex enterprise contact centers. Furthermore, we believe organizations typically refresh their on-premise contact center systems every 8-10 years, which provides an ongoing opportunity for cloud solutions to replace legacy on-premise contact center systems when these refresh decisions arise. Our Solution We deliver a comprehensive cloud software solution for contact centers. Our solution enables organizations of all sizes to optimize their contact center operations by enhancing agent productivity, improving customer satisfaction and driving cost efficiency. Our solution facilitates inbound customer-initiated interactions and outbound agent-initiated interactions and includes features such as automatic call distribution, interactive voice response, computer-telephony integration, outbound dialers and multi-channel capabilities. Table of Contents Create Powerful Customer Connections Cloud Contact Center Software. [Five9 Logo] Table of Contents Our cloud contact center software solution includes the following key elements: Rapid implementation, seamless updates and pre-built integrations. Our solution can be deployed and updated quickly with minimal disruption to our clients contact center operations and provides pre-built integrations with leading CRM and other enterprise applications. Highly flexible platform. Our solution provides easy administration, configuration and role-based functionalities for agents, supervisors and administrators, and enables the rapid adjustment of agent seats to meet changing contact center volumes. Scalable, secure and reliable multi-tenant architecture. Our solution provides organizations of all sizes with the robust contact center functionality, scalability, flexibility and security required in the most sophisticated and distributed environments. Our solution is designed to provide the following key benefits to our clients: Higher agent productivity. Our solution empowers greater agent productivity and utilization by allowing agents to handle both inbound and outbound calls and interact with customers across multiple other channels, including chat, email, web, social media and mobile. Improved customer satisfaction. Our solution routes each customer interaction to an appropriate agent resource and, through integrations with CRM applications, provides agents with immediate access to the most current, relevant and accurate information about the customer, resulting in increased first contact resolutions and a more satisfying experience for the customer. Enhanced end-to-end visibility. Our VCC cloud platform integrates our clients deployments across multiple contact center locations, providing an organization-wide view of their contact center operations. Our solution also enables our clients to quickly shift agent resources and adjust agent seats in response to changing business requirements, which results in higher agent utilization. Greater operational efficiency. Our solution provides contact center managers with significant visibility into their agents productivity and the efficiency and performance of their campaigns. Compelling value proposition. We provide a unified cloud-based software and telephony platform for contact center operations, which enables our clients to simplify their technology infrastructure and streamline IT costs. Our Competitive Strengths We believe that our position as a leading provider of cloud contact center software results from several key competitive strengths, including: Cloud-based, enterprise-grade platform and end-to-end application suite. Our highly scalable, secure, multi-tenant architecture enables us to serve large, distributed enterprises with complex contact center requirements, as well as smaller organizations, all from a single cloud platform. Rapid deployment of our comprehensive solution. Our solution enables our clients to quickly deploy and provision agent seats in any geographic location with only a computer, headset and broadband internet connection, and rapidly adjust the number of contact center agent seats in response to changing business requirements. Proven, repeatable and scalable go-to-market model. We engage with our clients through a highly scalable and metrics-driven sales and marketing organization that effectively identifies, qualifies and closes sales opportunities. The deep domain expertise of our field sales team is instrumental in selling to larger opportunities and our highly efficient telesales model enables us to cost-effectively identify, qualify and close a high volume of smaller opportunities. Established market presence and a large, diverse client base. We have a large, diverse client base of over 2,000 organizations across multiple industries. The performance, reliability, ease of use and comprehensive nature of our solution has resulted in high client satisfaction and retention. Table of Contents Cloud Contact Center Software from Five9 delivers exceptional customer experiences. 11 years of providing cloud contact center software Customer Channels Phone, chat, email, web, social media, mobile Agent & Self Service Resources In-house agents, outsourced agents, work-at-home agents, experts, self service Management Applications, Workforce Management, Reporting, Quality Management, Supervisor Inbound= Customer Service, Blended=Five9 Logo, VCC Cloud Platform, Oubound=Sales & Marketing Integrations, CRM & Other Business Applications 2,000 customers 3 Billion+ annual customer interactions 100%+* annual dollar based retention *For quarters ended March 31, 2012 December 31, 2013 Quarterly Revenue ($millions) Q112 = 14.3 Q212=15.0 Q312=16.2 Q412=18.3 Q113 = 19.1 Q213=20.3 Q313=21.1 Q413=23.6 Annual Revenue ($millions) 2009=19.5 2010=25.6 2011=43.2 2012=63.8 2013=84.1 Net Loss ($millions) 2009=(1.2) 2010=(1.9) 2011=(7.9) 2012=(19.3) 2013=(31.3) Table of Contents Extensive partner ecosystem. We have cultivated a robust ecosystem of partners, including a variety of leading CRM software vendors such as Salesforce.com, Inc. and Oracle Corporation, system integrators, analytics, workforce management and performance management software vendors and telephony providers. Focus on innovation and thought leadership. Since our inception, we have been an innovator of cloud contact center software. Our investment in research and development has driven our growth and enabled us to deliver a cloud contact center software solution with the features and functionality to power the most complex contact centers. Our Growth Strategy Our objective is to strengthen our position as a leader in cloud contact center software. To accomplish this goal, we are pursuing the following growth strategies: Capture increased market share. We believe there is a substantial opportunity for us to win new clients and increase our market share given the strength and client benefits of our cloud solution. Continue to increase sales in our existing client base. We intend to increase the number of agents using our solution within our existing clients as they experience the benefits of our cloud solution. Maintain our innovation leadership by strengthening and extending our solution. We intend to continue to make significant investments in research and development to strengthen our existing solution and develop additional industry-leading contact center features and applications. Expand internationally. We plan to increase our sales capabilities internationally by expanding our direct sales force and collaborating with strategic partners worldwide to target these markets and grow our international client base. Further develop our partner ecosystem. We have established strong partner relationships with organizations in the contact center ecosystem to further enhance the value of our enterprise-class cloud platform and intend to continue to cultivate new relationships to enhance the value of our solution and drive sales. Selectively pursue acquisitions. In addition to organically developing and strengthening our solution, we intend to actively and selectively explore acquisition opportunities of companies and technologies to expand the functionality of our solution, provide access to new clients or markets, or both.
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diff --git a/parsed_sections/prospectus_summary/2014/FOXF_fox_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/FOXF_fox_prospectus_summary.txt
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+S-1/A 1 forms-1aregistrationstatem.htm S-1/A Form S-1/A Registration Statement As filed with the Securities and Exchange Commission on July 7, 2014 Registration No. 333-196945 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 1 to FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Fox Factory Holding Corp. (Exact name of Registrant as Specified in its Charter) Delaware 3751 26-1647258 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 915 Disc Drive Scotts Valley, California 95066 (831) 274-6500 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Larry L. Enterline Chief Executive Officer Fox Factory Holding Corp. 915 Disc Drive Scotts Valley, California 95066 (831) 274-6500 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Stephen C. Mahon, Esq. David Haugen, Esq. Kevin P. Kennedy, Esq. Toby D. Merchant, Esq. Fox Factory Holding Corp. Simpson Thacher & Bartlett LLP Squire Patton Boggs (US) LLP 915 Disc Drive 2475 Hanover Street 221 E. Fourth Street, Suite 2900 Scotts Valley, California 95066 Palo Alto, California 94304 Cincinnati, Ohio 45202 (831) 274-6500 (650) 251-5000 (513) 361-1200 Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Amount to be registered(1) Proposed maximum aggregate offering price per share(2) Proposed maximum aggregate offering price(1)(2) Amount of registration fee(3) Common Stock, $0.001 par value per share 7,475,000 $17.73 $132,531,750 $17,070 (1) Includes shares or offering price of shares that the underwriters have the option to purchase. See Underwriting . (2) Estimated solely for the purpose of calculating the registration fee based on the average of the high and low prices for the registrant s common stock on the NASDAQ Global Select Market on July 1, 2014, pursuant to Rule 457(c) under the Securities Act of 1933, as amended. (3) Of this fee, $14,812 was previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and neither we nor the selling stockholders are soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to completion, dated July 7, 2014 Prospectus 6,500,000 shares Fox Factory Holding Corp. Common stock The selling stockholders identified in this prospectus are selling 6,500,000 shares of common stock. We will not receive any of the proceeds from the sale of the shares by the selling stockholders. Our common stock is listed on the NASDAQ Global Select Market under the symbol FOXF. On July 3, 2014, the last sale price of our common stock as reported on the Nasdaq Global Select Market was $17.98 per share. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and, as such, are subject to reduced public company reporting requirements. Per share Total Public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds to selling stockholders, before expenses $ $ (1) We have agreed to reimburse the underwriters for certain FINRA-related expenses. See Underwriting . Delivery of the shares of common stock is expected to be made on or about , 2014. The selling stockholders identified in this prospectus have granted the underwriters an option for a period of 30 days to purchase, on the same terms and conditions as set forth above, up to an additional 975,000 shares of our common stock. We will not receive any of the proceeds from the sale of shares by these selling stockholders if the underwriters exercise their option to purchase additional shares of common stock. Investing in our common stock involves substantial risk. Please read Risk factors beginning on page 12. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. BofA Merrill Lynch Baird William Blair Piper Jaffray SunTrust Robinson Humphrey CJS Securities The date of this prospectus is , 2014 TABLE OF CONTENTS Prospectus Page Prospectus Summary 1
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+F-1/A We are responsible for the information contained in this prospectus and in any free writing prospectus we prepare or authorize. We have not authorized anyone to provide you with different information, and we take no responsibility for any other information others may give you. We are not, and the underwriters are not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date of this prospectus. TABLE OF CONTENTS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information you should consider before investing in our ordinary shares. You should read this entire prospectus carefully, including the section entitled "Risk Factors" and the financial statements and the related notes included elsewhere in this prospectus, before you decide to invest in our ordinary shares. Company Overview We are a leading specialty minerals company that operates a unique, integrated business model. We extract raw materials and utilize sophisticated processing and product formulation technologies to add value to customers in three attractive end-markets: agriculture, food and engineered materials. These three end-markets constitute over 90% of our revenue. Our operations are organized into three segments: (1) Fertilizers, which operates the raw material extraction for us and markets potash, phosphates and specialty fertilizers; (2) Industrial Products, which primarily extracts bromine from the Dead Sea and produces and markets bromine and phosphorus compounds for the electronics, construction, oil and gas drilling and automotive industries and (3) Performance Products, which mainly produces, markets and sells a broad range of downstream phosphate-based food additives and industrial intermediates. Our principal assets include: Access to one of the world's richest, longest-life and lowest-cost sources of potash and bromine (the Dead Sea) Access to potash mines in the United Kingdom and Spain Bromine compounds processing facilities located in Israel, the Netherlands and China A unique integrated phosphate value chain, from phosphate rock mines in the Negev Desert in Israel to our value-added products in Israel, Europe, the United States, Brazil and China An extensive global logistics and distribution network with operations in over 30 countries A focused and highly experienced group of technical experts developing production processes, new applications, formulations and products for our three key end-markets: agriculture, food and engineered materials For the year ended December 31, 2013, we generated total sales of $6.3 billion, operating income of $1.1 billion, net income of $820.2 million and Adjusted EBITDA of $1.6 billion. Our Fertilizers segment sold 4.7 million tons of potash to external customers, 0.9 million tons of phosphate rock and 1.7 million tons of phosphate fertilizers, generating sales of $3.4 billion, operating income of $821.1 million and Adjusted EBITDA of $1.1 billion. Our Industrial Products segment generated sales of $1.3 billion, operating income of $114.5 million and Adjusted EBITDA of $224.7 million. Our Performance Products segment generated sales of $1.5 billion, operating income of $195.8 million and Adjusted EBITDA of $242.4 million. See " Summary Historical Consolidated Financial Data" for a definition of Adjusted EBITDA and a reconciliation to the comparable IFRS measure. Amendment No. 1 to FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 PRESENTATION OF FINANCIAL AND OTHER INFORMATION We maintain our financial books and records in U.S. dollars. Our consolidated income statement data for each of the years ended December 31, 2013, 2012 and 2011 and our consolidated balance sheet data as of December 31, 2013 and 2012, included in this prospectus, have been prepared in accordance with the international financial reporting standards ("IFRS"), as issued by the international accounting standards board ("IASB"). None of the financial information in this prospectus has been prepared in accordance with accounting principles generally accepted in the United States. Market data and certain industry data used in this prospectus were obtained from internal reports and studies, where appropriate, as well as estimates, market research, publicly available information and industry publications, including publications, reports or releases of the International Monetary Fund ("IMF"), the U.S. Census Bureau, the Food and Agriculture Organization of the United Nations ("FAO"), the International Fertilizers Association ("IFA"), the United States Department of Agriculture (the "USDA") and the United States Geological Survey. Industry publications generally state that the information they include has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. Similarly, internal reports and studies, estimates and market research, which we believe to be reliable and accurately extracted by us for use in this prospectus, have not been independently verified. However, we believe such data is accurate and agree that we are responsible for the accurate extraction of such information from such sources and its correct reproduction in this prospectus. There is only a limited amount of independent data available about certain aspects of our industry, market and competitive position. As a result, certain data and information about our market rankings in certain product areas are based on our good faith estimates, which are derived from our review of internal data and information, information that we obtain from customers, and other third party sources. We believe these internal surveys and management estimates are reliable; however, no independent sources have verified such surveys and estimates. This prospectus contains translations of certain NIS amounts into U.S. dollars at specified rates solely for your convenience. These translations should not be construed as representations by us that the NIS amounts actually represent such U.S. dollar amounts or could, at this time, be converted into U.S. dollars at the rate indicated. Unless otherwise indicated, we have translated NIS amounts into U.S. dollars at an exchange rate of NIS 3.471 to $1.00, the daily representative exchange rate reported by the Bank of Israel for December 31, 2013, and euro amounts into U.S. dollars at an exchange rate of 0.7257 to $1.00, the noon buying rate in New York for cable transfers payable in euros as reported by the U.S. Board of Governors of the Federal Reserve System for December 31, 2013. We own or have rights to trademarks or trade names that we use in conjunction with the operation of our business. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent of the law, our rights or the rights of the applicable licensor to these trademarks and trade names. In this prospectus, we also refer to product names, trademarks, trade names and service marks that are the property of other companies. Each of the trademarks, trade names or service marks of other companies appearing in this prospectus belongs to its owners. Our use or display of other companies' product names, trademarks, trade names or service marks is not intended to and does not imply a relationship with, or endorsement or sponsorship by us of, the product, trademark, trade name or service mark owner, unless we otherwise indicate. (1) Excludes Adjusted EBITDA attributable to Other and eliminations. Does not sum to 100% due to rounding. 2013 Revenue Contribution by End-Market 2013 Adjusted EBITDA Contribution by End-Market Our Industry The majority of our businesses compete in the global fertilizer and specialty chemicals industries. Fertilizers Fertilizers serve an important role in global agriculture by providing vital nutrients that help increase both the yield and the quality of crops. We supply two of the three essential nutrients potassium, phosphorous and nitrogen required for plant growth. There are no known substitutes for these nutrients. Although these nutrients are naturally found in soil, they are depleted over time by farming, which leads to declining crop yields and land productivity. To replenish these nutrients, farmers must apply fertilizers. The demand for fertilizers is volatile and seasonal, and pricing decreased in 2013; however, since the beginning of 2014, there have been price increases in some of the fertilizer products, particularly phosphate fertilizers. In our estimation, the policy of most countries is to ensure an orderly supply of high-quality food to their residents, including by encouraging agricultural production, which should preserve the long-term growth trend of fertilizer consumption. Potash, the salt form of potassium, helps regulate a plant's physiological functions and improves plant durability, providing crops with protection from drought, disease, parasites and cold weather. Unlike ISRAEL CHEMICALS LTD. (Exact Name of Registrant as Specified in Its Charter) Israel (State or Other Jurisdiction of Incorporation or Organization) 2870 (Primary Standard Industrial Classification Code Number) Not Applicable (I.R.S. Employer Identification Number) Israel Chemicals Ltd. Millennium Tower 23 Aranha Street P.O. Box 20245 Tel Aviv, 61202 Israel (972-3) 684-4400 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices) Table of Contents GLOSSARY OF SELECTED TERMS The following is a glossary of selected terms used in this prospectus. Bromine A chemical element used as a basis for a wide variety of uses and compounds, and mainly as a component in flame retardants or fire prevention substances. Unless otherwise stated, the term "bromine" refers to elemental bromine. CFR Cost and freight. In a CFR transaction, the prices of goods to the customer includes, in addition to FOB expenses, marine shipping costs and all other costs that arise after the goods leave the seller's factory gates and up to the destination port. Cleveland Potash Cleveland Potash Ltd., a United Kingdom company included in our Fertilizers segment. CPI The Consumer Price Index, as published by the Israeli Central Bureau of Statistics. Dead Sea Bromine Company Dead Sea Bromine Company Ltd., included in our Industrial Products segment. Dead Sea Magnesium Dead Sea Magnesium Ltd. Dead Sea Works Dead Sea Works Ltd., included in our Fertilizers segment. EPA U.S. Environmental Protection Agency. FAO The Food and Agriculture Organization of the United Nations, an international food organization. FOB Free on board expenses are expenses for overland transportation, loading costs and other costs, up to and including the port of origin. In an FOB transaction, the seller pays the FOB expenses and the buyer pays the other costs from the port of origin onwards. Iberpotash Iberpotash S.A., a Spanish company included in our Fertilizers segment. IFA The International Fertilizers Association, an international association of fertilizers manufacturers. ILA Israel Lands Administration. IMF International Monetary Fund. K The element potassium, one of the three main plant nutrients. N The element nitrogen, one of the three main plant nutrients. NYSE The New York Stock Exchange. P The element phosphorus, one of the three main plant nutrients, which is also used as a raw material in industry. Phosphate Phosphate rock that contains the element phosphorus. Its concentration is measured in units of P2O5. Table of Contents phosphate and nitrogen, potash does not require additional chemical conversion to be used as a fertilizer and is mined either from conventional underground mines or, less frequently, from surface or sub-surface brines, such as our operations in the Dead Sea. According to estimates from the United States Geological Survey, six countries accounted for approximately 87% of the world's aggregate potash production and the top seven producers operated approximately 78% of world production in 2013. Worldwide sales of potash recovered in 2013, as compared to 2012, although at a lower rate than expected at the beginning of 2013, due to a number of principal reasons: an erosion of 18% in the exchange rate of the Indian rupee against the U.S. dollar between January and November 2013, a fall in the prices of agricultural commodities in the fourth quarter of 2013 and the announcement of Uralkali , the Russian potash producer, in July 2013 of its exit from the joint potash marketing company with Belaruskali and a change in its selling strategy and transition to a policy favoring quantity over price while taking advantage of the company's full production capacity. This announcement triggered a fall in potash prices in the markets and also caused a postponement in potash purchases by customers due to their expectation of further price declines. In the fourth quarter of 2013, the demand for potash stabilized, and in the first half of 2014, there was further improvement, and prices, particularly of granulated potash, continued to rise, mainly in Europe and the United States. Global potash demand for agricultural uses is projected to grow at an average annual rate of 3% from 2013 through 2018 according to the IFA. Phosphate, a salt of phosphoric acid, is essential to plant root development and is required for photosynthesis, seed germination and efficient usage of water. Phosphate fertilizers are produced from phosphate rock, sulfuric acid and ammonia. The principal phosphate fertilizer producing regions are those with plentiful supplies of high quality, low-cost phosphate rock. The vast majority of the world's phosphate rock production in 2013 was in China, the United States, Morocco and Russia. Global phosphoric acid demand for all uses is forecast to grow at an annual rate of 2% through 2018 according to the IFA. Worldwide demand and prices for phosphate fertilizers were weak during all of 2013, mainly as a result of low demand in India and postponement of purchases throughout the world. Towards the end of 2013, phosphate prices started to rise moderately and continued to climb in the first quarter of 2014 due to strong demand in South America, commencement of preparation of the North American buyers for the upcoming season and return to the market of other buyers that had postponed purchases based on an expectation of continued price declines. At the beginning of the second quarter of 2014, there was a trend of declining prices, which reversed during the quarter. Barriers to adding new potash and phosphate production are significant. Adding new capacity requires long lead time and billions of dollars of capital per operation. In potash, economically recoverable deposits are scarce, typically deep in the earth and geographically concentrated. We believe that current potash market prices do not support the development of new (greenfield) mines. In phosphates, the need for economic access to multiple raw material feedstocks (phosphate rock, sulfuric acid and ammonia) combined with complex downstream production processes also act as significant barriers to entry. The specialty fertilizers market is growing faster than the conventional fertilizers market. Specialty fertilizers are often used for specialty crops (such as greenhouses and horticulture) but are rapidly expanding into usage for larger specialty field crops. Farmers are looking for fertilizers that are customized to meet the needs of specific crops and climates, to maximize yield and quality. Specialty fertilizers, such as controlled release fertilizers (which allow for the release of nutrients over time), slow release fertilizers (which allow for a very slow release of nutrients), liquid fertilizers (integrated in irrigation systems) and soluble fertilizers (integrated in drip irrigation systems and foliar spraying), ensure the timely and proportionate release of nutrients, thus not only significantly reducing their environmental impact but also providing highly efficient fertilization for a wide range of agricultural crops, including fruits, vegetables and high-value perennial crops. Increasing consumer demand for healthier food is expected to drive the growth of the specialty agriculture end-market, including specialty fertilizers. Avi Doitchman and Lisa Haimovitz Israel Chemicals Ltd. Millennium Tower 23 Aranha Street P.O. Box 20245 Tel Aviv, 61202 Israel (972-3) 684-4400 ICL North America Inc. Attention: General Counsel 622 Emerson Road, Suite 500 St. Louis, Missouri 63141 (314) 983-7500 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service) Table of Contents Polymer A chemical compound containing a long chain of repeating units linked by a chemical bond and created by polymerization. Polysulphate The commercial name for the mineral polyhalite, composed of potash, sulfur, calcium and magnesium, used in its natural form as fertilizer for organic agriculture. Potash Potassium chloride (KCl), used as a plant's main source of potassium. Potash Corporation of Saskatchewan Potash Corporation of Saskatchewan Inc., a Canadian company, the largest potash producer in the world, which owns 13.84% of our outstanding ordinary shares. REACH Registration, Evaluation and Authorization of Chemicals, a framework within the European Union. Rotem Rotem Amfert Negev Ltd., included in our Fertilizers segment. Salt Unless otherwise specified, sodium chloride (NaCl). Soluble NPK Soluble fertilizer containing the three basic elements for plant development (nitrogen, phosphorus and potash). Tami Tami (IMI) Research and Development Institute Ltd., the central research institute of ICL, included in our Industrial Products segment. TASE Tel Aviv Stock Exchange, Ltd. USDA United States Department of Agriculture. Table of Contents Specialty Phosphates Phosphate is also used in a broad range of downstream products in the food, electronics, energy and construction industries. These phosphate derivatives deliver additional and attractive margins. Main usage areas are: (1) food additives for improved texture and stability of processed foods such as meat, bakery, dairy and beverage products and (2) technical phosphates for usage in road surfaces, oil and paint additives, flame retardants and fire extinguishing. Demand for phosphate-based products is driven by global economic growth and improved living conditions. As global population grows, living standards improve and consumers demand more sophisticated food products, demand for phosphate-based products increases. Bromine The largest commercial use of bromine is brominated flame retardants, which accounts for approximately 40% of current demand for bromine. Flame retardants help materials such as plastic enclosures for consumer electronics, printed circuit boards, insulation materials for construction, furniture, automobiles, and textiles meet fire-safety requirements. The flame retardant market has contracted in the past few years. On the other hand, alternative uses of bromine have grown considerably, with bromine now used in a number of newer applications, including water purification, shale gas fracking, oil and gas drilling and other industrial uses. Many new applications are under development by us and our competitors. Bromine is found naturally in seawater, underground brine deposits and other water reservoirs, such as the Dead Sea, and is extracted by evaporation. The Dead Sea is the world's premier source of bromine, with concentration levels significantly higher than in regular seawater, and it accounts for about half of the global supply. Because it has the highest concentration of bromine, the Dead Sea is the most economical supply source as the least amount of water must be extracted and evaporated to generate bromine. The bromine industry is highly concentrated, with three companies accounting for approximately 80% of worldwide capacity in 2013 (us, Albemarle Corporation ("Albemarle") and Chemtura Corporation ("Chemtura")). Barriers to entry are significant, primarily due to the lack of economically feasible bromine supplies, and the requirement for a dedicated, complex and sophisticated global supply chain, such as the need for isotanks to transport bromine. We estimate that approximately 70% of global elemental bromine production is consumed internally, as there is a very small market for merchant bromine. As such, bromine production requires downstream compound production facilities. Highly Integrated and Synergistic Value Chain Copies to: Michael P. Kaplan Davis Polk & Wardwell LLP 450 Lexington Avenue New York, New York 10017 (212) 450-4000 Adam M. Klein Goldfarb Seligman & Co. 98 Yigal Alon Street Tel Aviv, 6789141 Israel (972-3) 608-9999 Leslie N. Silverman Cleary Gottlieb Steen & Hamilton LLP One Liberty Plaza New York, New York 10006 (212) 225-2000 Adva Bitan Gross, Kleinhendler, Hodak, Halevy, Greenberg and Co. One Azrieli Center Round Building Tel Aviv, 6701101 Israel (972-3) 607-9999 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Table of Contents Over 90% of our revenue is derived from three highly attractive end-markets: agriculture, food and engineered materials. Agriculture Global fertilizer demand is driven by grain demand and prices, which are primarily driven by population growth and dietary changes in the developing world: Population and Income Growth. Historically, growth in world fertilizer consumption has been closely correlated with growth in world population, which is expected to increase by over 1.0 billion to reach 8.3 billion by 2030, according to the U.S. Census Bureau. Currently, developed countries use fertilizer more intensively than developing countries and therefore produce crops at much higher yields. Economic growth in emerging markets is increasing food demand and thus fertilizer use. Populations in emerging markets are also shifting to more protein-rich diets as incomes increase, with such increased consumption requiring more grain for animal feed. According to the IMF, income per capita in developing countries is expected to grow by 6.0% annually up to 2018. Declining Arable Land per Capita. As the world's population grows, mainly in cities, farmland per capita decreases and more food production is required from each acre of farmland. This, in turn, requires increased yield on existing farms. According to data from the Food and Agriculture Organization of the United Nations ("FAO"), the amount of arable land per capita is expected to decrease from 0.218 hectares per person to 0.197 hectares per person between 2012 and 2030. Significant amounts of new arable land are only available in limited quantities, mainly in Brazil. Therefore, the only viable path to increase crop production is through the yield increase in existing farms in developing countries, mainly in China, India, Russia, Africa and Central America. We believe fertilizers (especially more potash and phosphates) together with water availability and better seeds are the main route to higher yields. Low Grain Stock-to-Use. The pressure on food demand is expected to continue to result in relatively low historical levels of the grain stock-to-use ratio (a metric indicating the level of carryover stock), as illustrated by the chart below. The grain stock-to-use ratio was approximately 20.8% for the 2013/2014 season, which represented an increase from a low of 16.6% for the 2006/2007 season but a decrease as compared to the high of 28.9% for the 2000/2001 season, according to data from the United States Department of Agriculture (the "USDA"). Based on a report published by the USDA in July 2014, an increase is expected in the grain stock-to-use ratio to approximately 21.3% at the end of the 2014/2015 season. A decline in the grain stock-to-use ratios generally indicates that grain prices will increase (due to limited stockpiles and tighter grain supply). This generally is a positive development for fertilizers, as higher grain prices support more fertilizer use. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents Food Consumer demand for different food products in developed countries has changed dramatically over the last several decades, driven by increased per capita incomes, demographic shifts and lifestyle changes. Longer working hours, changing family structures, increased awareness of nutrition and health issues and access to a broader variety of food products result in growing demand for sophisticated, higher-quality products with longer shelf-lives such as convenience food and processed food products. This changing demand includes greater demand for processed food products with enhanced nutritional value and balance and with improved flavor, texture and appearance. An increasingly longer supply chain and consumer awareness of waste of foods also drives the demand for longer shelf-life and food stability. These secular trends act as long-term drivers of demand for food additives such as phosphate derivatives, phosphate-based formulations and hygiene products for the processed meat, bakery, dairy and beverages industries. Engineered Materials Demand for engineered materials, which include bromine-, phosphorus-and phosphate-based products, is driven by increased construction, and greater demand for energy, potable water and pharmaceutical products. Increased standards of living also increase regulation and growing environmental awareness. These trends result in greater demand for flame retardants, bromine- and chlorine-based biocides for water purification and waste water treatment and bromine-, magnesia- and potassium chloride-based intermediates for the pharmaceutical industry. Additionally, growth in oil and gas exploration is expected to continue to drive demand for bromine-based completion fluids and for bromine-based biocides used for fracking. Worldwide annual average oil rig count has been growing at a compounded annual growth rate of 4.0%, from 2,395 in 2004 to 3,412 in 2013. Table of Contents PROSPECTUS (Subject to Completion) Dated September 22, 2014 The information in this prospectus is not complete and may be changed. Neither we nor the forward counterparties or selling shareholder, as applicable, may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and neither we nor the forward counterparties or selling shareholder, as applicable, is soliciting offers to buy these securities in any state where the offer or sale is not permitted. ISRAEL CHEMICALS LTD. 62,000,000 Ordinary Shares $ per share Table of Contents Our Competitive Strengths We attribute our success to the following strengths: Unique portfolio of mineral assets. We benefit from our access to resource-rich, long-life and low-cost raw materials, mainly potash and bromine. Our access to these resources is based upon exclusive concessions and licenses from the State of Israel, and leases and concessions from local governments in the United Kingdom and Spain. Access to these assets provides us with a consistent, reliable supply of raw materials, allowing us to produce our products on a large scale and in a cost-effective manner. Dead Sea in Israel: Our potash and bromine production facilities at the Dead Sea enjoy low production costs due to the high concentration and virtually unlimited supply of minerals contained in the Dead Sea. Extraction of potash and bromine occurs via solar evaporation, a low-cost process, as compared to mining potash from underground deposits or extracting bromine from less concentrated sources, which are more energy intensive. The hot and dry climate of the Dead Sea allows us to store at a low cost, very large amounts of potash (exceeding one full year of production) outdoors. This storage capacity enables us to operate worldwide potash facilities at full production capacity despite periodic fluctuations in demand. In addition, we benefit from the geographic proximity of our facilities in Israel to seaports and from Israel's geographic positioning vis- -vis our main geographical markets (especially the fast growing markets of India, China and Brazil), reducing transportation and logistics costs. While we benefit from these advantages, we expect to incur significant infrastructure-related costs to fully harvest salt from Pond 5 at our Dead Sea complex, which is our central evaporation pond, to avoid the need to continue to raise the water level in the pond. In addition, while the supply in the Dead Sea is virtually unlimited, our access to this supply of potash and bromine is subject to permitting and concession rights in Israel, the need to construct a new pumping station and the potential obligation to pay higher taxes and royalties. See "Risk Factors Risks Related to Our Business." United Kingdom and Spain assets: In addition to our operations in Israel, we mine potash in the United Kingdom and Spain. Access to these assets provides us with production and logistics flexibility, geographical proximity to European clients, business diversification and additional reserves for future growth. Our integrated phosphate value chain: Due to our access to the phosphate rock in the Negev Desert, we are the only sizeable backward integrated phosphate player. We mine and process phosphate rock from three open-pit mines under mining concessions with the State of Israel. Approximately three-quarters of the phosphate rock produced is used internally to manufacture phosphate fertilizers and phosphoric acid, with the balance sold to external producers. See "Risk Factors Risks Related to Our Business Our mining operations are dependent on concessions, licenses and permits granted to us by the respective governments in the countries where they are located." This is an initial public offering in the United States of ordinary shares of Israel Chemicals Ltd. Our controlling shareholder, Israel Corporation Ltd. ("Israel Corporation"), is selling 36,207,128 of our ordinary shares. In addition, Israel Corporation expects to enter into forward sale agreements with Morgan Stanley & Co. LLC and Goldman, Sachs & Co., or one of their respective affiliates, which we refer to in such capacities as the forward counterparties, pursuant to which Israel Corporation will sell, and the forward counterparties will purchase, up to 36,207,128 ordinary shares, subject to the terms and conditions of the forward sale agreements. Upon entry into the forward sale agreements, the forward counterparties expect to sell 25,792,872 of our ordinary shares under this prospectus through the underwriters named in this prospectus to hedge their positions under these forward sale agreements, and Israel Corporation will make available to the forward counterparties the ordinary shares to be sold by them under this prospectus. We refer in this prospectus to the combined offering of an aggregate amount of 62,000,000 of our ordinary shares, comprised of the sale by Israel Corporation of 36,207,128 of our ordinary shares and the expected sale by the forward counterparties of 25,792,872 of our ordinary shares, as the offering. See "Underwriting" for more details. We will not receive any proceeds from the sale of the ordinary shares by the underwriters, whether in connection with the forward sale agreements or the sale of ordinary shares by Israel Corporation directly to the underwriters, including any proceeds from any exercise by the underwriters of their option to purchase additional shares described below. Israel Corporation will receive proceeds from its sale of the ordinary shares directly to the underwriters and will receive proceeds from the forward counterparties if it enters into the forward sale agreements. Our ordinary shares are listed on the Tel Aviv Stock Exchange (the "TASE") under the symbol "ICL." On September 11, 2014, the last reported sale price of our ordinary shares on the TASE was NIS 26.90, or $7.41, per share (based on the exchange rate reported by the Bank of Israel on such date, which was NIS 3.6280 per $1.00). The price per share in this offering will be determined by reference to the closing price of the ordinary shares on the last TASE trading date prior to the pricing date. Table of Contents Diversification into higher value-added specialty products leveraging our integrated business model. Our integrated production processes are based on a synergistic value chain that allows us to both efficiently convert raw materials into value-added downstream products and utilize by-products. For example, in phosphates we utilize our backward integration to produce higher-margin specialty phosphates used in food ingredients and engineered materials applications. Our food ingredients provide solutions for improved texture and shelf-life for meat, dairy and bakery products. In addition, as a by-product of our potash production at the Dead Sea, we generate brines with the highest bromine concentration globally. Our bromine-based products serve the electronics, construction, oil and gas and other industries. Our potash mine in the United Kingdom also contains another mineral (polysulphate) which can be mined using the same infrastructure and addresses unmet emerging mineral needs of farmers. Leading positions in markets with high barriers to entry. We are a global leader in many of the key markets in which we operate, including potash, phosphorus and potassium ("PK") fertilizers, specialty fertilizers and phosphates, elemental bromine and phosphate-based food additives. We believe we are generally ranked among the top three leaders in our markets, as shown in the table below: Product Rank End-markets Potash #2 in Western Europe and #6 Worldwide Agriculture PK fertilizers #1 in Western Europe Agriculture Specialty fertilizers #1 Worldwide in MAP/MKP soluble fertilizers, #2 (tied) in Europe in controlled-release fertilizers and #1 in the United States in controlled-release fertilizers Agriculture Phosphate-based food additives Top 3 Worldwide Food Specialty phosphates Top 2 Worldwide Food / Engineered Materials Elemental bromine #1 Worldwide Engineered Materials Phosphorus-based flame retardants #1 Worldwide Engineered Materials Forest fire retardants #1 Worldwide Engineered Materials Most of our businesses rely on natural resources that are scarce and concentrated in the hands of a few market participants, making it difficult for new competitors to enter our businesses. Our exclusive concessions, intellectual property and proprietary technologies, world-wide marketing and distribution network and high industry start-up costs for new market entrants further add significant barriers to entry. Strategically located production and logistics assets. We benefit from the proximity of our facilities, both in Israel and Europe, to developed economies (Western Europe) and emerging markets (such as China, India and Brazil). For example, in Israel, we ship from two seaports: the Port of Ashdod (with access to Europe and South America) and the Port of Eilat (with access to Asia, Africa and Oceania). Access to these two ports provides us with two distinctive advantages versus our competitors: (1) we have lower plant gate-to-port costs and ocean freight costs, which lowers our overall cost structure and (2) we have faster time to markets due to our proximity to end-markets, allowing us to opportunistically fill short lead-time orders, strengthening our position with our customers. In addition, we are the sole producer with the ability to transport potash and phosphates We have been approved to list the ordinary shares on the New York Stock Exchange (the "NYSE") under the symbol "ICL." Table of Contents from the same port (which we do in Israel). Our sales are balanced between emerging markets (approximately 40% of 2013 sales) and developed economies (approximately 60% of 2013 sales). Significant operating cash flow generation and return on capital. Our businesses have historically generated significant amounts of operating cash flow, having generated $1.7 billion and $1.1 billion of operating cash flow in 2012 and 2013, respectively. We are able to generate significant levels of operating cash flow due to the size and scale of our business and our relatively high margins. These cash flows have enabled us to produce high returns on capital, appropriately maintain and expand our production facilities and take advantage of acquisition opportunities. In addition, since 2007, we have had a policy of paying a quarterly dividend of up to 70% of our net income. This policy has resulted in a strong dividend yield of 8% (equal to the total dividend per share in NIS distributed from net income in 2013, including a special one-time $500 million dividend, divided by the average price per share on the TASE during 2013). Highly knowledgeable people and culture of collaboration and determination. Our operations are managed by an international management team with extensive industry experience. We develop leaders with strong experience in their fields and the culture to drive change and innovation in our Company. We also bring in leaders from outside the Company to supplement our expertise. We focus on nurturing and empowering talent through a global platform of qualification, collaboration and communication that reinforces innovation. Our Strategy Our "2020 Next Step Forward" corporate strategy is targeted to fulfill essential needs in our three core markets. We have developed a strategic plan based on three value-creation pillars: (1) Efficiency: improve existing operations; (2) Growth: organic and external expansion of our value chain from specialty minerals into the agriculture, food and engineered materials markets; and (3) Enablers: create one global ICL, strengthen innovation, provide an empowering environment to our people and align management with our stakeholders to support our growth and efficiency goals. We intend to implement this strategy while maintaining our strong financial position and our current dividend policy of distributing up to 70% of our net income. Our key strategic initiatives include: Continuously improve the cost position of our distinctive mineral asset base. We have identified, and have started implementing cost reduction initiatives in our potash and phosphate operations. At our facility in Spain, we are consolidating our activities from two facilities into one facility while maintaining our production capacity. This will help us lower our fixed costs of production. At Cleveland Potash Ltd. ("Cleveland Potash") in the United Kingdom, we are upgrading our production facilities to improve utilization rates, which will significantly reduce fixed costs per ton. Finally, at the Dead Sea in Israel, we are increasing the potential production capacity of our potash processing plants, and implementing process efficiencies to improve our utilization rates. In phosphates, we intend to transform our cost base by implementing an efficiency plan at our Rotem site, including headcount reductions that are currently being implemented and process improvements to increase utilization rates. Regarding the plan for efficiency and integration of the global processes into our Company, as well as the plan for reducing the production cost of our specialty minerals pursuant to the strategic plan described below, we estimate that these activities, the execution of which we have already started, will give rise to savings by the end of 2016 in the amount of approximately $350 million annually compared with 2013. Our estimate is based on projections made by our management and subjective assessments that are based on the experience we have accumulated and on actual process improvements. While the cost savings and efficiencies to be generated by our strategic plan described above are presented with numerical specificity, and we believe such targets to be reasonable as of the date of this prospectus, the manner of implementation of the strategic plan and its impact may be different, possibly even significantly Investing in the ordinary shares involves risks. See "Risk Factors" beginning on page 20 of this prospectus. Table of Contents different, than that forecasted. This may result from various factors, including the situation prevailing in the market, competition, regulation and the risk factors characterizing our activities. Accordingly, our actual results may differ from these targets and the differences may be material and adverse, particularly if actual events adversely differ from one or more of our key assumptions. We caution investors not to place undue reliance on any of these assumptions and targets. See "Special Note Regarding Forward-Looking Statements" for additional information regarding these forward-looking statements and "Risk Factors." Streamline and integrate our global processes. We have also identified several areas of efficiency improvements such as procurement, pricing, energy, research and development ("R&D") and other shared services. For example, in procurement we are optimizing expenditures by consolidating our purchasing activities on a global basis. In energy, we are improving technical systems to optimize usage and are building a cogeneration power plant based on natural gas (dual-fuel) in order to achieve energy self-sufficiency in Israel by 2016. Expand our production capabilities and reserves base. We plan to increase our potash production capability to approximately 6 million tons per year by 2018. This will be achieved through debottlenecking in Spain and improved utilization rates in Israel and the United Kingdom. At Cleveland Potash, we are extending the mining area to provide additional reserves and to increase our low-cost polysulphate production, a new fertilizer targeting low sulfur soils. In addition, we are evaluating further capacity increases in our current potash assets and at other potential potash locations. In phosphate, we are increasing our production in Rotem by approximately 15% by improving utilization rates. In addition, we are seeking governmental and municipal approvals for a new mining site Barir field in the Negev Desert in Israel, which, if granted, will provide further cost savings and increased scale through a focused investment program. See "Risk Factors Risks Related to Our Business Our mining operations are dependent on concessions, licenses and permits granted to us by the respective governments in the countries where they are located." Separately, we are assessing additional phosphate reserves in emerging markets with an intention to develop a full phosphate franchise in key regions in the world. Consistent with this strategy, we are in active discussions concerning phosphate franchises in key emerging markets. As of the date of this prospectus, we are negotiating with a third party for the engagement in joint ventures for current and future activities relating to the mining and sale of phosphate rock in emerging markets as well as for the production, marketing and distribution of downstream products of phosphate rock in the aforementioned markets. As of the date of this prospectus, the negotiations have not yet ripened into in-principle commercial agreements and the parties have not yet reached essential agreement regarding the structure of the transaction and the consideration to be paid by the Company, and therefore definitive agreements have yet to be signed and there is no certainty that these negotiations will ultimately result in definitive binding agreements or that such transactions will be consummated. If the negotiations ripen into definitive agreements, the Company estimates that the consideration it pays will be hundreds of millions of dollars. Expand market demand for our products. In potash, we will increase our investment in educating emerging market farmers on the economic benefits of applying the optimal levels of potash. In particular, we are focusing on India and Africa due to our current position in these markets, our proximity to them and the currently low application of potash in these markets. This demand creation is intended to secure above-average sales growth in potash for us. We intend to continue driving demand growth for bromine through the development of new products and new applications by increasing our R&D spending, utilizing our industry knowledge, collaborating with others and by advocating for fire safety and mercury control regulations in emerging markets. Grow our value-added downstream products. As part of our growth strategy we intend to use our strong cash flow to further grow our specialty and value-added products organically and through acquisitions. This will allow us to drive strong growth in our businesses and continue to evolve from Price to Public Underwriting Discounts and Commissions(1) Proceeds to forward counterparties Proceeds to Israel Corporation Per Share $ $ $ $ Total $ $ $ $ Table of Contents a product-based to a market-focused organization. In the fast growing and high return-on-assets specialty fertilizers business, we are improving our core technologies and expanding our geographical footprint in liquid fertilizers, advanced coated fertilizers and soluble fertilizers. In food, we intend to expand our existing phosphate-based texture and stability solutions to emerging markets. In addition, we are constantly collaborating with our customers to develop new formulations. The next phase of this strategy is to leverage our expertise and technology platform to provide enhanced texture and stability solutions beyond additives based solely on phosphates, including through acquisitions, strategic partnerships and joint ventures. Finally, in engineered materials, we intend to utilize our expertise and technology in developing bromine and phosphate-based solutions for industrial applications. With respect to our activities that do not constitute our core businesses, we are examining various possibilities in connection with the continued integration of such activities in our Company and are preparing to divest activities that are not synergetic with our activities. As of the date of this prospectus, we are taking various measures to execute these activities in a monetary scope estimated by us in the range of $300 million to $500 million, including by means of contacting potential purchasers and/or requesting to receive offers. However, binding agreements have not yet been signed and, accordingly, there is no certainty that binding agreements will be signed or that one or more of these transactions will be completed. Our goal is to generate over 10% of sales from new product introduction in our specialty businesses (outside potash and commodity phosphates) by 2018. Further develop and enhance our "One ICL" culture and empower our people. In order to achieve our strategies and continue to carry out our evolution from a natural resources company to an essential needs company, we believe we must continue to enable our people to thrive within our organization and are implementing our "One ICL" strategy. Under our "One ICL" strategy, we are working to harmonize our systems (for example, by moving to a single global enterprise resource planning system) and processes and better share best practices across our Company to ensure that we provide the best services within our end-markets and avoid product or divisional silos. We will continue to identify and reward top performing employees and will move them to the right locations within the organization where they can be most effective, while incentivizing them through compensation and performance assessments to help us achieve our goals. Recent Developments We continue to actively work to implement our strategic plan as described above, but, as we do so, we are undergoing a review of our plans in Israel to address the following recent developments in Israel: On May 19, 2014, we received the partial award of an arbitration panel, the main points of which are as follows: (i) our subsidiary, Dead Sea Works Ltd. ("Dead Sea Works"), has to pay royalties to the State of Israel on the sale of downstream products manufactured by subsidiaries that are controlled by us that have production plants both in and outside the Dead Sea area, including outside Israel; (ii) the royalties shall be paid according to the value of the downstream products, which will be set according to the formula described in Section 15(a)(2) of the Concession Deed (the sale price of the downstream product to unrelated third parties minus the deductions set forth in sub-sections (I), (II) and (III) of that section); and (iii) with respect to metal magnesium, it was decided that the State of Israel and Dead Sea Works should exhaust their discussions on the subject of the royalties to be paid by Dead Sea Works on this material and, if no agreement is reached, the subject will be returned to arbitration. The arbitrators' award was given with respect to fundamental determinations with respect to the liability to pay royalties on downstream products and does not include any reference to the financial calculations arising out of the award. The financial calculation will be resolved during the next phase of the arbitration. In the second quarter of 2014, we recorded a provision in the amount of approximately $135 million due to the implementation of the partial arbitration award for the years 2000 through 2013 (representing $149 million for royalties for such years plus $31 million for interest (in financing expenses), net of tax of $45 million). In addition, as (1)Israel Corporation has agreed to reimburse the underwriters for certain expenses in connection with this offering. See "Underwriting." Israel Corporation has granted the underwriters the right to purchase an additional 6,200,000 ordinary shares. Neither the Securities and Exchange Commission ("SEC") nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the ordinary shares to purchasers on or about , 2014. Table of Contents a result of the arbitrators' decision, the current expense in the first half of 2014 in respect of royalties increased by approximately $6 million. The arbitrators' award is partial and the financial calculations as to the method of implementation of the award have yet to be determined by the arbitrators. Therefore, our estimation is based on various assumptions regarding the manner of calculating the royalties pursuant to the partial arbitration award and reflects our best estimate of the expenditure that will be required to settle the liability as of June 30, 2014. The final amount that will be determined by the arbitrators at the end of the second stage of the arbitration after the arbitration panel determines the financial calculations as noted above may differ, including materially, from this provision amount. In the second stage of the arbitration, which will deal with determination of the amounts of the royalties, we intend to claim that the correct amount of the royalties is significantly lower than the amount stated. In 2013, our subsidiary, Dead Sea Works, paid royalties to the State of Israel on sales of bromine in the amount of approximately $10.3 million. According to the assumptions on the basis of which the provision was made, as mentioned above, Dead Sea Works would have been required to pay additional royalties in 2013 in the amount of approximately $11.4 million (before tax) on downstream products. The amount of royalties to be paid in the future for the aforementioned downstream products will be derived from, among other things, the quantities sold, market prices and the mix of products and therefore may differ from the amounts which would have been paid for the year 2013, as mentioned above. Together with our financial and legal advisors, we are reviewing the arbitration panel's award and its implications. A committee formed by the Israeli finance minister (the "Sheshinski Committee") to evaluate the appropriate policy of the State of Israel in respect of royalties to be paid for use of natural resources announced on May 18, 2014 draft recommendations (the "Committee's Interim Recommendations") for public comment that would set (i) a unified royalty rate of 5% from the sales ex plant (compared to the current phosphate royalty rate of 2% ex mine and the potash royalty rate of 5% on the first 1.5 million tons sold and 10% on any additional quantities sold; the bromine royalty rate would remain unchanged at the current 5%); and (ii) a new "natural resources tax," which would be in addition to the regular Israeli corporate income tax (see "Tax Considerations" for a discussion of the Israeli corporate tax rate), on the operating profit of each company that exploits natural resources in Israel at the suggested rate of 42%, which would apply to all operating profits after the deduction of an amount equal to an 11% return on the book value (after depreciation) of such company's fixed assets. On July 17, 2014, we submitted our response, in writing, to the Committee's Interim Recommendations and on August 4, 2014, we orally presented our position to the Sheshinski Committee and pointed out errors and that the Sheshinski Committee's model was inconsistent with principles and targets established by it, will have negative consequences and is unconstitutional. See "Business Mineral Extraction and Mining Operations Concessions and Mining Royalties." We intend, with the assistance of our legal advisors, to take all necessary legal actions in order to protect our rights. On August 6, 2014, our Board of Directors discussed the impact of the Committee's Interim Recommendations and the partial arbitration award in the royalties arbitration (the "Royalties Arbitration"), as well as the need to implement cost-cutting and efficiency plans, and its main resolutions are as follows: We estimate, based on our 2013 prices and cost structure and an effective corporate tax rate of 26.5%, and assuming that the Committee's Interim Recommendations were applied with respect to our bromine and bromine compounds subsidiaries on a consolidated basis, that the incremental after-tax cost to us of the Committee's Interim Recommendations, together with the impact of the Royalties Arbitration, would be approximately $160 million per year. The actual cost for the applicable years could differ based on market pricing, our cost structure, the corporate tax rate, the Morgan Stanley Barclays Deutsche Bank Securities Goldman, Sachs & Co. BMO Capital Markets , 2014 Table of Contents final methodology for calculation of the tax rate, changes in the committee's final recommendations as compared to the current recommendations and the final outcome of the Royalties Arbitration. The recommendations of the Sheshinski Committee remain subject to a public review process, and once any final recommendations are produced by the Sheshinski Committee, these recommendations will require approval by the Israeli cabinet and the Knesset before implementation. The recommendations described above could change materially at any point during this process and are not binding upon us until enacted into law. Any new unified royalty rate or new taxes with respect to Dead Sea Works are not expected to become effective until 2017, although taxes applicable to phosphate and bromine operations could be implemented sooner. To continue to freeze our investments in Israel, as incorporated in our long-term plan, and to re-evaluate the attractiveness of each investment, separately. As of the date of this prospectus and so long as the Committee's Interim Recommendations are expected to be implemented, we have decided to (a) cancel investments that were previously approved by us prior to the date of announcement of the Committee's Interim Recommendations, and (b) cease approving further investments, in an aggregate amount of approximately $750 million. We are continuing to evaluate the impact of implementation of the Committee's Interim Recommendations and the Royalties Arbitration on additional investment plans, in the amount of approximately $1 billion. To continue to evaluate the implementation of cost-cutting initiatives and the possibility for their acceleration. To continue to act to execute our strategy of expanding our operations in more attractive geographic areas, and to the extent required, to reallocate spending that had previously been planned for Israel into projects or acquisitions in these other markets. To evaluate the economic profitability of continuing to produce certain products, including metal magnesium, bromine compounds and certain phosphate downstream products. The economic profitability review will consider the option of discontinuing certain products and/or to endeavor to reduce the production costs in connection with these products, including by means of potential collaborations. Further to the Board of Directors' resolution on the evaluation of the economic profitability of continuing to produce certain products, including metal magnesium, bromine compounds and certain phosphate downstream products, on August 27, 2014, our Board of Directors decided as follows: Our Board of Directors instructed our management team to develop and implement an efficiency plan designed to significantly improve the profitability of Bromine Compounds Ltd. ("Bromine Compounds"), which is in our Industrial Products segment. Our Board of Directors has determined that this plan is required due to the continuing erosion of profits on bromine compounds as a result of a decline in demand for flame retardants, low structural growth of the world market, a drop in prices and strengthening of the shekel, compounded by the significant recent developments related to the partial arbitration decision with respect to royalties on sales of downstream products, including bromine compounds and the possibility that the Sheshinski Committee's Interim Recommendations will be adopted and enacted into legislation. Our management team is making preparations to formulate a plan, as stated, which it expects will include the reduction of labor and other costs in Bromine Compounds. No assurances can be provided that we will be able to formulate such a plan or that such a plan can be implemented successfully, as a result of various factors, including the situation of the market, competition, regulation, labor relations and/or any of the risk factors associated with the operation of our Company as set forth in this prospectus. In addition, our Company could be adversely affected as a result of such plan, including through potential labor unrest. Our Board of Directors instructed our management team to make preparations for the closure of our magnesium plant at the Dead Sea, commencing January 1, 2017, unless the discussions with the Table of Contents State of Israel regarding the tax and royalties issues will support the continuation of the activities of the magnesium plant. Our management team has been instructed to support all existing and future customer orders and commitments in order to avoid any interruptions until the final closure of the plant. The main economic justification for continuation of the activities of the magnesium plant at the Dead Sea stems from the plant's synergies with our other facilities in Sodom, which provide it with, and receive from it, raw materials (the "Synergies"). The net value of the Synergies has declined due to the increase in the tax burden on production from natural resources in Israel that have already been implemented, and will further decline if the Sheshinski Committee's Interim Recommendations are enacted into law. As result of the abovementioned tax burden, we have halted all investments in the magnesium plant (other than investments required by law). In 2013, our total sales of magnesium were approximately $115 million and the gross profit of the magnesium company in 2013 was approximately $1 million, the net book value of the assets of the magnesium company as of June 30, 2014 was approximately $35 million and the depreciation expense in 2013 was approximately $6 million. Our History We were established in 1968 as a government owned and operated company in Israel and operate today as a limited liability company under the laws of Israel. In 1975, the shares of various development companies (including, among others, Dead Sea Works, the companies today consolidated as Rotem Amfert Negev Ltd. ("Rotem"), the bromine companies and Tami (IMI) Research and Development Institute Ltd. ("Tami")) were transferred to us. In 1992, following a decision by the Israeli government to privatize our Company, Israel published its tender prospectus, and the shares of ICL were listed on the TASE. Prior to our public share issuance, we issued to Israel a special state share (the "Special State Share") in our Company and our main Israeli subsidiaries. See "Description of Share Capital The Special State Share." In 1995, Israel sold its controlling interest in us (representing approximately 24.9% of our shares) to Israel Corporation, which was controlled at that time by the Eisenberg family. A majority of the ordinary shares held by Israel were sold during the following years. In 2000, Israel ceased to be an interest holder in terms of holding any ordinary shares in us, but it retained the Special State Share. In 1999, the Ofer Group acquired the Eisenberg family's shares in Israel Corporation. Immediately prior to this offering, Israel Corporation holds approximately 52.38% of our outstanding ordinary shares. With respect to any ordinary shares Israel Corporation sells directly to the underwriters, it will cease to have voting rights. With respect to any ordinary shares subject to the forward sale agreements, and made available to the forward counterparties under these agreements, Israel Corporation will cease to have voting rights with respect to these ordinary shares and will, at the relevant settlement dates, regain voting rights with respect to all or a portion of the ordinary shares it makes available to the forward counterparties under these agreements if it elects cash settlement or net physical settlement. Other Information Our legal and commercial name is Israel Chemicals Ltd. Our registered office and principal place of business is located at Millennium Tower, 23 Aranha Street, P.O. Box 20245, Tel Aviv 61202, Israel. The telephone number at our registered office is +972-3-684-4400. Our website address is www.icl-group.com. The reference to our website is intended to be an inactive textual reference and the information on, or accessible through, our website is not intended to be part of this prospectus. Until , 2014 (25 days after commencement of this offering), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. Table of Contents THE OFFERING The offering This is a combined offering of an aggregate amount of 62,000,000 of our ordinary shares, comprised of the sale by Israel Corporation of 36,207,128 of our ordinary shares and the expected sale by the forward counterparties of 25,792,872 of our ordinary shares to hedge their positions under the forward sale agreements described below. Our controlling shareholder, Israel Corporation, expects to enter into forward sale agreements with the forward counterparties pursuant to which Israel Corporation will sell, and the forward counterparties will purchase, up to 36,207,128 ordinary shares, subject to the terms and conditions of the forward sale agreements. The forward counterparties expect to sell 25,792,872 of our ordinary shares under this prospectus through the underwriters named in this prospectus to hedge their positions under these forward sale agreements. Israel Corporation will make available to the forward counterparties the ordinary shares to be sold by them under this prospectus. Ordinary shares issued and outstanding as of the date of this prospectus (excluding shares held by us or our subsidiaries) 1,270,425,548 ordinary shares. Option to purchase additional shares Israel Corporation has granted the underwriters the right to purchase an additional 6,200,000 ordinary shares. Use of proceeds We will not receive any proceeds from the sale of the ordinary shares by the underwriters, whether in connection with the forward sale agreements or the sale of ordinary shares by Israel Corporation directly to the underwriters, including any proceeds from any exercise by the underwriters of their option to purchase additional shares. Israel Corporation will receive proceeds from its sale of the ordinary shares directly to the underwriters and will receive proceeds from the forward counterparties if it enters into the forward sale agreements. Dividend policy Our Board of Directors has adopted a dividend policy to pay quarterly dividends of up to 70% of our net income. Any dividends must be declared by our Board of Directors, which will take into account various factors including our profits, our investment plan, our financial status and additional factors they deem appropriate. Dividend payments are not guaranteed and our Board of Directors may decide, in its absolute discretion, at any time and for any reason, not to pay dividends. See "Dividend Policy." On August 6, 2014, we declared a $47 million dividend, which was paid on September 17, 2014 with an ex-dividend date of September 4, 2014. Risk factors See "Risk Factors" for a discussion of risks you should consider before deciding to invest in our ordinary shares. Proposed NYSE trading symbol "ICL." Table of Contents Conflicts of Interest Some of our ordinary shares will be sold by the underwriters in connection with the forward sale agreements. Because each of Morgan Stanley & Co. LLC and Goldman, Sachs & Co. is acting as an underwriter for the offering and will receive in its (or its respective affiliate's) capacity as a forward counterparty at least 5% of the proceeds of this offering, a conflict of interest under Financial Industry Regulatory Authority ("FINRA") Rule 5121 is deemed to exist. As required by FINRA Rule 5121, Barclays Capital Inc. has agreed to act as "qualified independent underwriter" for this offering and has participated in the preparation of, and has exercised the usual standards of "due diligence" in respect of, this prospectus. See "Underwriting Conflicts of Interest." Unless we specifically state otherwise, references in this prospectus to the amount of our ordinary shares issued and outstanding and the percentage ownership of our shareholders as of the date of this prospectus exclude shares held by us or our subsidiaries and the information in this prospectus does not take into account: the sale of up to 6,200,000 ordinary shares that the underwriters have the option to purchase from Israel Corporation; 11,993,400 ordinary shares issuable upon the exercise of options outstanding as of June 30, 2014 under our incentive compensation plans at a weighted average exercise price of NIS 42.6585 per share (see "Management Incentive Compensation Plans" for more information about our outstanding option plans); and up to 4,384,540 shares issuable upon exercise of options and up to 1,025,449 restricted shares that may be granted under our new equity compensation plan approved by our Board of Directors on August 6, 2014 (and subject to shareholder approval in the case of the grants to our Chief Executive Officer). 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+This summary highlights the information contained elsewhere in this prospectus. Because this is only a summary, it does not contain all of the information that you should consider before deciding whether to exercise your subscription rights. You should carefully read this entire prospectus, including the information contained in the sections entitled Risk Factors and The Rights Offering, our audited consolidated financial statements and the accompanying notes for the year ended September 30, 2013, and our unaudited consolidated financial statements for the quarter ended March 31, 2014, both of which are incorporated into this prospectus by reference, in their entirety before you decide to exercise your subscription rights. Overview Integrated Electrical Services, Inc. is a holding company that owns and manages operating subsidiaries in business activities across a variety of end markets. Our operations are currently organized into four principal business segments, based upon the nature of our current products and services: Communications Nationwide provider of products and services for mission critical infrastructure, such as data centers, of large corporations. Residential Regional provider of electrical installation services for single-family housing and multi-family apartment complexes. Commercial & Industrial Provider of electrical design, construction, and maintenance services for commercial and industrial projects nationwide. Infrastructure Solutions Provider of industrial and rail services, and electrical and mechanical solutions to domestic and international customers. (This segment was created in connection with the acquisition of MISCOR Group, Ltd. ( MISCOR ).) Corporate Strategy We seek to create shareholder value through positive returns on capital and generation of free cash flow. In addition, we seek to acquire or invest in similar stand-alone platform companies based in North America or acquire businesses that strategically fit within our existing business segments. In evaluating potential acquisition candidates, we seek to invest in businesses with, among other characteristics: Significant market share in niche industries and low technological and/or product obsolescence risk; Proven management with a willingness to continue post acquisition; Established market position and sustainable advantage; High returns on invested capital; and Strong cash flow characteristics. We believe that acquisitions provide an opportunity to expand into new end markets and diversify our revenue and profit streams. Further, by acquiring businesses with strong cash flow characteristics we expect to maximize the value of our significant NOLs. While we may use acquisitions to build our presence in the electrical infrastructure industry, we will also consider potential acquisitions in other industries, which could result in changes in our operations from those historically conducted by us. Table of Contents Controlling Shareholder A majority of our outstanding common stock is owned by Tontine. On March 4, 2014, Tontine filed an amended Schedule 13D indicating its ownership level of 60%. As a result, Tontine can control most of our affairs, including most actions requiring the approval of shareholders, such as the approval of any potential merger or sale of all or substantially all assets, segments, or the Company itself. While Tontine is subject to restrictions under federal securities laws on sales of its shares as an affiliate, Tontine is party to a Registration Rights Agreement with the Company under which it has the ability, subject to certain restrictions, to demand registration of its shares in order to permit unrestricted sales of those shares. On February 20, 2013, pursuant to the Registration Rights Agreement, Tontine delivered a request to the Company for registration of all of its shares of IES common stock, and on June 18, 2013, a shelf registration statement (as amended, the Shelf Registration Statement ) registering Tontine s shares was declared effective by the SEC. As long as the Shelf Registration Statement remains effective, Tontine has the ability to resell any or all of its shares from time to time in one or more offerings, as described in the Shelf Registration Statement and in any prospectus supplement filed in connection with an offering pursuant to the Shelf Registration Statement. If Tontine were to resell all or a substantial portion of its shares, it could result in a change of control of the Company, which would trigger the change of control provisions in a number of our material agreements, including our credit facility, bonding agreements with our sureties and our executive severance plan, as well as a change in ownership that could impact our NOLs, as described below. Net Operating Loss Carry Forward Currently, IES and certain of its subsidiaries have a federal NOL of approximately $466 million, including approximately $141 million resulting from the additional amortization of goodwill. A change in ownership, as defined by Internal Revenue Code Section 382, could reduce the availability of net operating losses for federal and state income tax purposes. Should Tontine sell or otherwise dispose of all or a portion of its position in IES, a change in ownership could occur. In addition a change in ownership could result from the purchase of common stock by an existing or a new 5% shareholder as defined by Internal Revenue Code Section 382, including as a result of this offering. Should a change in ownership occur, all NOLs incurred prior to the change in ownership would be subject to limitations imposed by Internal Revenue Code Section 382, which would substantially reduce the amount of NOL currently available to offset taxable income. On January 28, 2013, the Company implemented the NOL Rights Plan, which was designed to deter an acquisition of the Company s stock in excess of a threshold amount that could trigger a change of control within the meaning of Internal Revenue Code Section 382. For additional information on the NOL Rights Plan, see Description of Capital Stock Series A Junior Participating Preferred Stock. Outlook IES management expects the Company s fiscal third quarter net income from continuing operations to be between $2.1 million and $3.8 million and fiscal third quarter earnings per share to be between $0.12 per share and $0.21 per share, not inclusive of the effect of the rights offering, based upon the Company s preliminary, unaudited results for April and May 2014 and its latest expectations for June 2014. The estimates of future financial results included in this section are based upon information and assumptions available to management at the time of preparation, which are subject to change. There can be no assurance that the information or assumptions underlying the estimates will prove to be accurate or that the estimated results will be realized, and actual results may differ, and may differ materially, from those reflected in these estimates. We also caution readers that forward-looking statements are subject to risks and uncertainties that could cause the Company s actual future outcomes to differ materially from those set forth in such estimates. Such risks and uncertainties include, but are not limited to, the risk factors described under Risk Factors. Among other items, the assumptions underlying our estimates of future financial results do not reflect potential variability in earnings associated with large projects or unusual events. Due to the size of Table of Contents certain large projects, changes in estimated recoveries, change orders or costs associated with such projects could have a material impact on the Company s earnings and net income. In addition, IES undertakes no obligation, except as required by law, to update or otherwise revise the estimates contained in this section to reflect circumstances existing since their preparation, the occurrence of unanticipated events, or changes in general economic or industry conditions, even in the event that any or all of the underlying assumptions are shown to be in error. How You Can Contact Us Our principal executive offices are located at 5433 Westheimer Road, Suite 500, Houston, Texas 77056, and our telephone number is (713) 860-1500. We also maintain an executive office in Greenwich, Connecticut. Our website is located at www.ies-corporate.com. Information on our website or any other website is not incorporated by reference into this prospectus and does not constitute a part of this prospectus. Table of Contents
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+The following is a summary of material information discussed in this prospectus. It is included for convenience only and should not be considered complete. You should carefully review this entire prospectus, including the risk factors, to better understand the rights offering and our business and financial position.
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diff --git a/parsed_sections/prospectus_summary/2014/LOCO_el-pollo_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/LOCO_el-pollo_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and the consolidated financial statements and the notes to those statements included elsewhere in this prospectus. You should read the entire prospectus carefully, including the section entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before making a decision to purchase shares of our common stock. Our Company It All Starts with Our Chicken El Pollo Loco is a differentiated and growing restaurant concept that specializes in fire-grilling citrus-marinated chicken in front of our customers. We operate within the fastest growing segment of the restaurant industry, the limited service restaurant ( LSR ) segment. We believe we offer the quality of food typical of fast casual restaurants while providing the speed, convenience and value typical of traditional QSRs, a combination which we call QSR+ and which provides a value-oriented fast casual dining experience. Our distinctive menu features our signature product citrus-marinated fire-grilled chicken and a variety of Mexican-inspired entrees that we create from our chicken. Every day in every restaurant s kitchen we marinate and fire-grill our chicken over open flames, hand-slice whole tomatoes, avocados, serrano peppers and cilantro to make our salsas, guacamole and cilantro dressings from scratch. The open design of our kitchens reveals our Mexican-inspired cooking process and allows our customers to watch our Grill Masters and team members fire-grill and hand-cut our signature chicken, as well as make burritos, salads, tostadas, bowls, stuffed quesadillas and chicken entrees. We offer our customers healthier alternatives to traditional food on the go, served by our engaging team members in a colorful, bright and contemporary restaurant environment. We serve individual and family-sized chicken meals, a variety of Mexican-inspired entrees, sides, and, throughout the year, on a limited-time basis, alternative proteins like shrimp, carnitas and beef. Our entrees include favorites such as our Poblano Burrito, Under 500 Calorie Mango Grilled Tostada, Ultimate Pollo Bowl, Grand Baja Shrimp Tacos and Chicken, Bacon and Guacamole Stuffed Quesadilla. Our freshly-prepared salsas and dressings are prepared daily allowing our customers to create their favorite flavor profiles to enhance their culinary experience. Our distinctive menu with healthier alternatives appeals to consumers across a wide variety of socio-economic backgrounds and drives our balanced composition of sales throughout the day (our day-part mix ), including at lunch and dinner. El Pollo Loco is Spanish for The Crazy Chicken. We opened our first location on Alvarado Street in Los Angeles, California in 1980, and have grown our restaurant system to 405 restaurants, comprised of 166 company-operated and 239 franchised restaurants as of September 24, 2014. Our restaurants are located in California, Arizona, Nevada, Texas and Utah. Our typical restaurant is a free-standing building with drive-thru service that ranges in size from 2,400 to 3,000 square feet with seating for approximately 70 people. Our restaurants generated company-operated restaurant revenue of $294.3 million and $238.4 million and system-wide sales of $657.6 million and $537.7 million, for the year ended December 25, 2013 and the thirty-nine weeks ended September 24, 2014, respectively. We believe the quality of our food and dining experience and the affordable prices we offer our customers drive our operating results, as illustrated by the following: we achieved positive comparable restaurant sales growth in 13 consecutive quarters through our fiscal quarter ended September 24, 2014; our annual AUVs grew from $1.5 million in 2011 to $1.8 million in 2013; from 2011 to 2013, we increased our restaurant contribution margin for our company-operated restaurants by 230 basis points to 21.0%, and for the thirty-nine weeks ended September 24, 2014, we increased our restaurant contribution margin for our company-operated restaurants by 60 basis points to 21.8%, as compared to the thirty-nine weeks ended September 25, 2013; and Table of Contents The information contained in this preliminary prospectus is not complete and may be changed. Neither we nor any selling stockholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, dated November 17, 2014 PRELIMINARY PROSPECTUS 6,000,000 Shares El Pollo Loco Holdings, Inc. Common Stock This is a public offering of our common stock. The selling stockholders named in this prospectus are offering 6,000,000 shares of our common stock and we will not receive any proceeds from the sale of shares by the selling stockholders. Our common stock is listed on the NASDAQ Global Select Market under the symbol LOCO. On November 14, 2014, the last reported sale price of our common stock on the NASDAQ Global Select Market was $34.33 per share. Investing in our common stock involves a high degree of risk. Please read the Risk Factors section beginning on page 14 of this prospectus. We are an emerging growth company under applicable federal securities laws and are subject to reduced public company reporting requirements. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PER SHARE TOTAL Public offering price $ $ Underwriting discounts and commissions* $ $ Proceeds, before expenses, to the selling stockholders $ $ * We refer you to Underwriting beginning on page 103 of this prospectus for additional information regarding underwriting compensation. Delivery of the shares of common stock is expected to be made on or about , 2014. The selling stockholders have granted the underwriters an option for a period of 30 days to purchase up to 900,000 additional shares of our common stock. If the underwriters exercise the option in full, the total underwriting discounts and commissions payable by the selling stockholders will be $ , and the total proceeds to the selling stockholders, before expenses, will be $ . Jefferies Baird Morgan Stanley William Blair Stifel Prospectus dated , 2014 Table of Contents MARKET AND INDUSTRY DATA AND FORECASTS Certain market and industry data included in this prospectus, including industry data derived from information provided by Technomic, Inc. ( Technomic ), has been obtained from third party sources that we believe to be reliable. Market estimates are calculated by using independent industry publications, government publications and third party forecasts in conjunction with our assumptions about our markets. We have not independently verified such third party information. While we are not aware of any misstatements regarding any market, industry or similar data presented herein, such data involves risks and uncertainties and is subject to change based on various factors, including those discussed under the headings Special Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. BASIS OF PRESENTATION In this prospectus, unless the context otherwise requires: we, us, our, the Company or Holdings refers collectively to El Pollo Loco Holdings, Inc., a Delaware corporation, incorporated in 2005, the issuer of the common stock in this offering, and its subsidiaries; Intermediate refers to our direct, wholly owned subsidiary, EPL Intermediate, Inc.; EPL or El Pollo Loco refers to El Pollo Loco, Inc., which does not have any subsidiaries and is Intermediate s sole subsidiary; Trimaran refers to Trimaran Capital Partners, its predecessors and, where applicable, certain funds managed by Trimaran; Freeman Spogli refers to Freeman Spogli & Co. and, where applicable, certain funds managed by Freeman Spogli; LLC refers to Trimaran Pollo Partners, L.L.C., an affiliate of Trimaran and Freeman Spogli and our majority stockholder; our restaurant system refers to both company-operated and franchised restaurants, and the number of restaurants presented in our restaurant system, unless otherwise indicated, is as of September 24, 2014; our restaurants or results or statistics attributable to one or more restaurants without expressly identifying them as company-operated, franchised or the entire restaurant system, refers to our company-operated restaurants only; system-wide sales refers to restaurant-level sales for company-operated restaurants plus sales reported to us by our franchisees; and El Pollo Loco is Spanish for The Crazy Chicken. We use a 52- or 53-week fiscal year ending on the last Wednesday of each calendar year. Fiscal 2011, fiscal 2012 and fiscal 2013 ended on December 28, 2011, December 26, 2012 and December 25, 2013, respectively. In a 52-week fiscal year, each quarter includes 13 weeks of operations; in a 53-week fiscal year, the first, second and third quarters each include 13 weeks of operations and the fourth quarter includes 14 weeks of operations. Approximately every six or seven years a 53-week fiscal year occurs. Fiscal 2011, fiscal 2012 and fiscal 2013 were 52-week fiscal years. Fiscal 2014 is a 53-week fiscal year. Comparable restaurant sales growth reflects the change in year-over-year sales for the comparable restaurant base. A restaurant enters our comparable restaurant base the first full week after its 15-month anniversary. System-wide comparable restaurant sales include restaurant sales at all comparable company-operated restaurants and at all Table of Contents from 2011 to 2013, we increased our total revenue by 15.2% to $314.7 million, increased our Adjusted EBITDA (as defined under Summary Consolidated Financial and Other Data below) by 39.2% to $55.0 million, and decreased our net loss from $32.5 million to $16.9 million. Included in our net loss figures for 2011 and 2013 were expenses for early extinguishment of debt totaling $20.2 million and $21.5 million, respectively. System-Wide Comparable Restaurant Sales Growth 13 Consecutive Quarters of Growth Our Industry According to Technomic, 2013 total sales increased 3.8% to $193.3 billion for restaurants in the Technomic Top 500 categorized as LSRs establishments where customers generally pay up-front for selected food items that generally cost between $3.00 and $12.00 and are later consumed on-premises, taken-out, or delivered. In 2013, the Mexican and chicken menu categories for LSRs in the Technomic Top 500 grew 6.8% and 4.6%, respectively, outpacing the broader LSR category. We operate within the broader LSR segment, and we believe that we offer the food and dining experience of a fast-casual restaurant and the speed, value and convenience of a QSR. We believe our value-oriented fast casual positioning best aligns with the overall growth characteristics of the fast-casual restaurants because we believe we offer the method of preparation, quality of food and dining experience typical of fast casual restaurants. According to Technomic, the fast casual sub-segment grew 11% in 2013, to $27.1 billion in total sales. Technomic projects the total fast-casual sub-segment to grow to $50 billion by 2017. We believe our differentiated menu, colorful, bright and contemporary restaurant environments and convenient locations position us to compete successfully against other fast-casual and QSR concepts, providing us with a large addressable market. We believe we are also well positioned to benefit from a number of culinary and demographic trends in the United States. We expect that the trend towards healthier eating will attract and increase consumer demand for fresh and hand-prepared dishes, leading to a positive impact on our sales. Furthermore, as indicated by recent high growth in the Mexican restaurant segment, we expect to benefit from increased acceptance of Mexican food in the United States in the general market. Finally, we also anticipate benefits from the continued growth of the Hispanic population in the United States, which, according to the U.S. Census Bureau, has grown from 50.5 million people in 2009 to 53.0 million people in 2012, and is projected to reach 78.7 million in 2030. The growth of the Hispanic population is expected to outpace overall population growth, and the Hispanic population as a percentage of the total U.S. population is expected to increase from 16.3% in 2011 to 21.9% by 2030. Table of Contents We are responsible for the information contained in this prospectus and in any related free-writing prospectus we may prepare or authorize to be delivered to you. We have not, and the underwriters and the selling stockholders have not, authorized anyone to give you any other information, and we and the underwriters and the selling stockholders take no responsibility for any other information that others may give you. We are not, and the underwriters and the selling stockholders are not, making an offer of these securities in any jurisdiction where the offer is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus. TABLE OF CONTENTS Market and Industry Data and Forecasts ii Basis of Presentation ii Trademarks and Copyrights iv Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/LPG_dorian_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/LPG_dorian_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights information that appears later in this prospectus and is qualified in its entirety by the more detailed information and financial statements included elsewhere in this prospectus or incorporated by reference herein. This summary may not contain all of the information that may be important to you. As an investor or prospective investor, you should carefully review the more detailed information that appears later in this prospectus, including the section entitled "Risk Factors" beginning on page 9 of this prospectus and in our Annual Report on Form 20-F for the fiscal year ended March 31, 2014, filed on July 30, 2014, and incorporated by reference herein, before making an investment in our common shares. Unless otherwise indicated, references to "Dorian," the "Company," "we," "our," "us," or similar terms refer to Dorian LPG Ltd. and its subsidiaries. The terms "Predecessor" and "Predecessor Business" refer to the owning companies of the four vessels of our Initial Fleet, as defined below, prior to their acquisition by us. We use the term "VLGC" to refer to very large gas carriers. We use the term "LPG" to refer to liquefied petroleum gas and we use the term "cbm" to refer to cubic meters in describing the carrying capacity of our vessels. References in this prospectus to "Statoil," "Shell" and "Vitol" refer to Statoil ASA, Royal Dutch Shell plc, and Vitol S.A., respectively, and certain of each of their subsidiaries that are our customers. Unless otherwise indicated, all references to "U.S. dollars," "USD," "dollars," "U.S.$," and "$" in this prospectus are to the lawful currency of the United States of America and references to "Norwegian Kroner" and "NOK" are to the lawful currency of Norway. Our Company We are a Marshall Islands corporation headquartered in the United States and primarily focused on owning and operating VLGCs, each with a cargo carrying capacity of greater than 80,000 cbm. Our initial fleet consisted of three modern 82,000 cbm VLGCs and one pressurized 5,000 cbm vessel (the"Initial Fleet"). We currently own and operate six LPG carriers, including two fuel-efficient 84,000 cbm ECO-design VLGCs constructed by Hyundai Heavy Industries Co., Ltd. ("Hyundai" or "HHI") and delivered in July 2014 and September 2014, as well as the Initial Fleet, through our management function which was brought in house from our existing managers at the end of the second calendar quarter of 2014. In addition, we have newbuilding contracts for the construction of seventeen new fuel efficient 84,000 cbm ECO-design VLGCs at Hyundai and Daewoo Shipping and Marine Engineering Ltd. ("Daewoo"), both of which are based in South Korea, with scheduled deliveries between January 2015 and January 2016. Our principal shareholders include Scorpio Tankers Inc. ("Scorpio Tankers") (NYSE:STNG); SeaDor Holdings LLC ("SeaDor Holdings"), an affiliate of SEACOR Holdings Inc. (NYSE:CKH); Kensico Capital Management Corporation ("Kensico Capital Management") and Dorian Holdings LLC ("Dorian Holdings"), which own approximately 16.3%, 16.1%, 13.9% and 9.8%, respectively, of our total shares outstanding, as of November 26, 2014. Each is represented on our board of directors or retains the right to appoint a director. Our customers include global energy companies such as Statoil and Shell, commodity traders such as Vitol, and industrial users. Two of our vessels are currently on time charters. Our first newbuilding, the Comet, is on a five-year time charter to Shell that began on July 25, 2014 and the Captain Markos NL is currently on a time charter to Statoil that will conclude in December 2014. Immediately following the conclusion of the Statoil time charter, the Captain Markos NL will commence a five-year time charter with Shell. We were incorporated on July 1, 2013 under the laws of the Republic of the Marshall Islands for the purpose of owning and operating LPG carriers. On July 29, 2013, in connection with our formation, we entered into concurrent transactions in which we issued an aggregate of 18,644,324 common shares to Dorian Holdings, SeaDor Holdings and other investors, in exchange for the four vessels in our Initial Fleet, including our assumption of debt obligations associated with the vessels, contracts for the construction of three newbuilding VLGCs and options to acquire an additional three newbuilding VLGCs, which we have since exercised, and net proceeds of approximately $162 million. On November 26, 2013, we completed the acquisition of 13 VLGC newbuilding contracts, associated deposits to shipyards and cash from Scorpio Tankers in return for 7,990,425 common shares, and we simultaneously completed a private placement in Norway of 16,081,081 common shares for net proceeds of approximately $243 million. On February 12, 2014, we completed a private placement in Norway of 5,649,200 common shares for net proceeds of approximately $96 million. On April 25, 2014, we completed a private placement of 1,412,698 common shares with a strategic investor for net proceeds of approximately $25.9 million. On May 13, 2014, we completed an initial public offering of 7,105,263 common shares on the New York Stock Exchange at a price of $19.00 per share, or $135.0 million in gross proceeds not including underwriting fees or offering costs of $11.5 million. On May 22, 2014, we completed the issuance of 245,521 common shares related to the overallotment exercise by the underwriters of the Company's initial public offering at a price of $19.00 per share, or $4.7 million in gross proceeds not including underwriting fees or closing costs of $0.3 million. Our Fleet Our operating fleet currently consists of six LPG carriers, including two fuel-efficient 84,000 cbm ECO-design VLGCc, three modern 82,000 cbm VLGCs and one pressurized 5,000 cbm vessel. In addition, we have newbuilding contracts for the construction of seventeen new fuel efficient 84,000 cbm VLGCs at Hyundai and Daewoo, both of which are based in South Korea, with scheduled deliveries between January 2015 and January 2016. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form F 1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Dorian LPG Ltd. (Exact name of registrant as specified in its charter) Marshall Islands (State or other jurisdiction of incorporation or organization) 4412 (Primary Standard Industrial Classification Code Number) N/A (I.R.S. Employer Identification Number) Dorian LPG Ltd. c/o Dorian LPG (USA) LLC 27 Signal Road Stamford, Connecticut 06902 (203) 674 9695 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Seward & Kissel LLP Attention: Gary J. Wolfe, Esq. One Battery Park Plaza New York, New York 10004 (212) 574 1200 (Name, address and telephone number of agent for service) Copies to: Gary J. Wolfe, Esq. Seward & Kissel LLP One Battery Park Plaza New York, New York 10004 (212) 574 1200 (telephone number) (212) 480 8421 (facsimile number) Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. x If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered (1) Proposed Maximum Offering Price per Common Share (2) Proposed Maximum Aggregate Offering Price (2) Amount of Registration Fee (3) Common Shares, $0.01 par value per share, to be offered by certain selling shareholders 33,789,576 $ 12.92 $ 436,561,321.92 $ 50,728.43 (1) Pursuant to Rule 416 under the Securities Act of 1933, as amended (the "Securities Act"), the common shares being registered hereunder include such indeterminate number of shares as may be issuable as a result of stock splits, stock dividends or similar transactions or as a result of the operation of anti-dilutive provisions and adjustments to conversion ratios. (2) Pursuant to Rule 457(c), the offering price and registration fee are computed on the average of the high and low prices for the common shares on the New York Stock Exchange on December 1, 2014. (3) Determined in accordance with Section 6(b) of the Securities Act to be $50,728.43, which is equal to .0001162 multiplied by the proposed maximum aggregate offering price of $436,561,321.92. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Each of our newbuildings will be an ECO design vessel incorporating advanced fuel efficiency and emission reducing technologies. Upon completion of our VLGC Newbuilding Program in January 2016, 100% of our VLGC fleet will be operated as sister ships and the average age of our VLGC fleet will be approximately 1.6 years, while the average age of the current worldwide VLGC fleet is approximately 10.6 years. The following table sets forth certain information regarding our vessels as of the date of this prospectus: Capacity (Cbm) Shipyard Sister Ships Year Built/ Estimated Delivery(1) ECO Vessel(2) Charterer Charter Expiration(1) OPERATING FLEET VLGC Captain Nicholas ML 82,000 Hyundai A 2008 Spot Captain John NP 82,000 Hyundai A 2007 Spot Captain Markos NL (3) 82,000 Hyundai A 2006 Statoil Q4 2014 Shell Q4 2019 Comet (4) 84,000 Hyundai B 2014 X Shell Q4 2019 Corsair (5) 84,000 Hyundai B 2014 X Spot Small Pressure Grendon 5,000 Higaki 1996 Spot NEWBUILDING VLGCs Corvette 84,000 Hyundai B Q1 2015 X Cougar 84,000 Hyundai B Q2 2015 X Cobra 84,000 Hyundai B Q2 2015 X Continental 84,000 Hyundai B Q2 2015 X Concorde 84,000 Hyundai B Q2 2015 X Constitution 84,000 Hyundai B Q2 2015 X Commodore 84,000 Hyundai B Q3 2015 X Constellation 84,000 Hyundai B Q3 2015 X Cresques 84,000 Daewoo C Q3 2015 X Cheyenne 84,000 Hyundai B Q3 2015 X Clermont 84,000 Hyundai B Q3 2015 X Chaparral 84,000 Hyundai B Q4 2015 X Commander 84,000 Hyundai B Q4 2015 X Cratis 84,000 Daewoo C Q4 2015 X Copernicus 84,000 Daewoo C Q4 2015 X Challenger 84,000 Hyundai B Q1 2016 X Caravel 84,000 Hyundai B Q1 2016 X Total 1,847,000 ________________________ (1) Represents calendar year quarters. (2) Represents vessels with very low revolutions per minute, long stroke, electronically controlled engines, larger propellers, advanced hull design, and low friction paint. (3) Currently on time charter with Statoil expected to conclude in December 2014. Immediately upon conclusion of that time charter, a 5 year time charter with Shell will commence at a rate of $850,000 per month. (4) Delivered on July 25, 2014 and on a time charter with Shell that began on that date at a rate of $945,000 per month. (5) Delivered on September 26, 2014 and currently in the spot market. Installment payments made by us or through acquisitions total $489.6 million under our VLGC Newbuilding Program and our remaining contractual commitments total approximately $1.0 billion, as of November 26, 2014. Although we can provide no assurance that we will be successful in obtaining financing at all or on satisfactory terms, we plan to finance the estimated remaining project costs for the vessels in our VLGC Newbuilding Program with cash on hand and borrowings in an estimated amount of approximately $750 million under new credit facilities currently being negotiated with commercial banks and Korean export credit agencies. Management of Our Business All technical and commercial management services for our fleet are provided by the following wholly-owned subsidiaries: Dorian LPG (USA) LLC provides financial and commercial management services to us; Dorian LPG (UK) Ltd provides chartering, post-fixture operations, legal and risk management services for us; and Dorian LPG Management Corp. (Greece) provides technical, health/safety/environmental/quality, human resource and accounting services to us. Risk Factors We face a number of risks associated with our business and industry and must overcome a variety of challenges to benefit from our strengths and implement our business strategies. These risks relate to, among others, changes in the international shipping industry, including supply and demand, charter hire rates, commodity prices, global economic activity, hazards inherent in our industry and operations resulting in liability for damage to or destruction of property and equipment, pollution or environmental damage, ability to comply with covenants in the credit facilities we have or may enter into, ability to finance capital projects, and ability to successfully employ our LPG carriers. You should carefully consider the risks described in the section entitled "Risk Factors" beginning on page 9 of this prospectus and in our Annual Report on Form 20-F for the fiscal year ended March 31, 2014, filed on July 30, 2014, and incorporated by reference herein, and the other information in this prospectus, before deciding whether to invest in our common shares. Implications of Being an Emerging Growth Company We had less than $1.0 billion in revenue during our last fiscal year, which means that we qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act (the "JOBS Act"), and the related provisions of the Securities Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include: the ability to present only two years of audited financial statements and only two years of related Management's Discussion and Analysis of Financial Condition and Results of Operations in the registration statement for our initial public offering; exemption from the auditor attestation requirement in the assessment of the emerging growth company's internal controls over financial reporting; exemption from new or revised financial accounting standards applicable to public companies until such standards are also applicable to private companies; and exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board (the "PCAOB") requiring mandatory audit firm rotation or a supplement to our auditor's report in which the auditor would be required to provide additional information about the audit and our financial statements. We may take advantage of these provisions until the end of the fiscal year following the fifth anniversary of our initial public offering or such earlier time that we are no longer an emerging growth company. We will cease to be an emerging growth company if we have more than $1.0 billion in "total annual gross revenues" during our most recently completed fiscal year, if we become a "large accelerated filer" with market capitalization of more than $700 million, or as of any date on which we have issued more than $1.0 billion in non-convertible debt over the three year period to such date. We may choose to take advantage of some, but not all, of these reduced burdens. For as long as we take advantage of the reduced reporting obligations, the information that we provide shareholders may be different from information provided by other public companies. We are choosing to "opt out" of the extended transition period relating to the exemption from new or revised financial accounting standards and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. The information in this Prospectus is not complete and may be changed. The Selling Shareholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This Prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED DECEMBER 3, 2014 PRELIMINARY PROSPECTUS Up to 33,789,576 of our Common Shares Offered by the Selling Shareholders Dorian LPG Ltd. _________________ The selling shareholders named in the section "Selling Shareholders" of this prospectus, or their respective donees, pledgees, transferees or other successors in interest, which we refer to collectively as the Selling Shareholders, may sell in one or more offerings pursuant to this registration statement up to an aggregate of 33,789,576 of our common shares. The Selling Shareholders may, from time to time, sell, transfer or otherwise dispose of any or all of these common shares, including on any stock exchange, market or trading facility on which our common shares are traded or in privately negotiated transactions at fixed prices that may be changed, at market prices prevailing at the time of sale or at negotiated prices. See "Plan of Distribution" beginning on page 40. We are not selling any common shares under this prospectus and will not receive any proceeds from the sale of the common shares by the Selling Shareholders. Information on the Selling Shareholders and the times and manners in which they may offer and sell our common shares are described under the sections entitled "Selling Shareholders" and "Plan of Distribution" in this prospectus. We will bear all costs, expenses and fees in connection with the registration of the common shares sold under this prospectus. _________________ Our common shares are currently listed on the New York Stock Exchange under the symbol "LPG". On November 26, 2014, the last reported sale price of our common shares was $14.86 per share. _________________ Investing in our common shares involves risks. See "Risk Factors" beginning on page 9 of this prospectus and in our Annual Report on Form 20-F for the fiscal year ended March 31, 2014, filed on July 30, 2014, and incorporated by reference herein. The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. _________________ The date of this prospectus is , 2014 Corporate Structure We were incorporated in the Republic of the Marshall Islands on July 1, 2013 as a subsidiary of Dorian Holdings, for the purpose of owning and operating LPG carriers. On July 29, 2013, in connection with our formation, we entered into concurrent transactions in which we issued an aggregate of 18,644,324 common shares to Dorian Holdings, SeaDor Holdings and other investors, in exchange for the four vessels in our Initial Fleet, including our assumption of debt obligations associated with the vessels, contracts for the construction of three newbuilding VLGCs and options to acquire an additional three newbuilding VLGCs, which we have since exercised, and net proceeds of approximately $162 million as described in Note 1 to the consolidated financial statements included in our Annual Report on Form 20-F, filed with the SEC on July 30, 2014 and incorporated by reference herein. As of the date of this prospectus, Scorpio Tankers, SeaDor Holdings, Kensico Capital Management and Dorian Holdings control a substantial ownership percentage in us, representing approximately 16.3%, 16.1%, 13.9% and 9.8%, respectively, of our outstanding common shares. We own our vessels through separate wholly-owned subsidiaries that are incorporated in the Republic of the Marshall Islands. Effective July 1, 2014, vessel management services for our fleet is provided through our wholly-owned subsidiaries Dorian LPG (USA) LLC, Dorian LPG (UK) Ltd and Dorian LPG Management Corp., incorporated in Delaware, the United Kingdom and the Republic of the Marshall Islands, respectively. The following diagram depicts our organizational structure: Dorian LPG Ltd. (Marshall Islands) Vessel Management Companies: Dorian LPG (USA) LLC (Delaware) Dorian LPG (UK) Ltd (United Kingdom) Dorian LPG Management Corp. (Marshall Islands) Vessel Owning Subsidiaries: (Marshall Islands) CNML LPG Transport LLC CJNP LPG Transport LLC CMNL LPG Transport LLC Grendon Tanker LLC Comet LPG Transport LLC Corsair LPG Transport LLC Newbuild Vessel Owning Subsidiaries: (Marshall Islands) Corvette LPG Transport LLC Dorian Houston LPG Transport LLC Dorian Shanghai LPG Transport LLC Dorian Sao Paulo LPG Transport LLC Dorian Ulsan LPG Transport LLC Concorde LPG Transport LLC Dorian Amsterdam LPG Transport LLC Dorian Dubai LPG Transport LLC Dorian Monaco LPG Transport LLC Constellation LPG Transport LLC Dorian Barcelona LPG Transport LLC Dorian Geneva LPG Transport LLC Dorian Cape Town LPG Transport LLC Dorian Tokyo LPG Transport LLC Commander LPG Transport LLC Dorian Explorer LPG Transport LLC Dorian Exporter LPG Transport LLC CORPORATE INFORMATION Our principal executive offices are at 27 Signal Road, Stamford, Connecticut 06878. Our telephone number at that address is (203) 674-9695. Our website is www.dorianlpg.com. The information contained on our website is not a part of this registration statement. OTHER INFORMATION Because we are incorporated under the laws of Marshall Islands, you may encounter difficulty protecting your interests as shareholders, and your ability to protect your rights through the U.S. federal court system may be limited. Please refer to the sections entitled "Risk Factors" and "Enforceability of Civil Liabilities" for more information. TABLE OF CONTENTS PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our Class A common stock, you should carefully read this entire prospectus, including our financial statements and the related notes thereto and the information set forth under the sections "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the historical financial statements and related notes, in each case included in this prospectus. Some of the statements in this prospectus constitute forward-looking statements. See "Special Note Regarding Forward-Looking Statements." Unless the context requires otherwise, the words "Company," "we," "us" and "our" refer to Moelis & Company and its subsidiaries, and for periods prior to the reorganization described herein, the advisory business of Moelis Asset Management LP (formerly known as Moelis & Company Holdings LP). Unless the context otherwise requires, references to (1) "Moelis & Company" refer solely to Moelis & Company, a Delaware corporation, and not to any of its subsidiaries, (2) "Group LP" refer solely to Moelis & Company Group LP, a Delaware limited partnership, and not to any of its subsidiaries, (3) "Partner Holdings" refer to Moelis & Company Partner Holdings LP, a Delaware limited partnership, and (4) "Old Holdings" refer to Moelis Asset Management LP (formerly known as Moelis & Company Holdings LP), a Delaware limited partnership. Moelis & Company Moelis & Company is a leading global independent investment bank that provides innovative strategic and financial advice to a diverse client base, including corporations, governments and financial sponsors. We assist our clients in achieving their strategic goals by offering comprehensive, globally integrated financial advisory services across all major industry sectors. Our team of experienced professionals advises clients on their most critical decisions, including mergers and acquisitions ("M&A"), recapitalizations and restructurings and other corporate finance matters. Since our inception, we have achieved rapid growth by hiring high-caliber professionals, expanding the scope and geographic reach of our advisory services, developing new client relationships and cultivating our professionals through training and mentoring. Today we serve our clients with over 375 advisory professionals, including 96 Managing Directors, based in 16 offices around the world. We have advised on over $1 trillion of transactions, including three of the ten largest announced global mergers and acquisitions and four of the ten largest announced global recapitalizations and restructurings in 2013. Moelis & Company was founded in 2007 by veteran investment bankers to create a global independent investment bank that offers multi-disciplinary solutions and exceptional transaction execution combined with the highest standard of confidentiality and discretion. We create lasting client relationships by providing focused innovative advice through a highly collaborative and global approach not limited to specific products or access to particular regions. Our compensation model fosters our holistic approach to clients by emphasizing quality of advice and is not a commission-based structure where employees are compensated on a defined percentage of the revenues they generate. We believe our discretionary approach to compensation leads to exceptional advice, strong client impact and enhanced internal collaboration. We have demonstrated strong financial performance, achieving revenues of $411 million and pre-tax income of $73 million in 2013, our sixth full year of operations. We have also won numerous awards for our client focus and innovation, including "Most Innovative Independent Investment Bank" by The Banker in 2010, 2011 and 2013 and "Best Global Independent Investment Bank" by Euromoney Magazine in 2010 and have served as financial advisor to our clients on many noteworthy assignments, including the following transactions. Amendment No. 1 to FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents MARKET AND INDUSTRY DATA The industry, market and competitive position data referenced throughout this prospectus are based on research, industry and general publications, including surveys and studies conducted by third parties. Industry publications, surveys and studies generally state that they have been obtained from sources believed to be reliable. We have not independently verified such third party information. While we are not aware of any misstatements regarding any industry, market or similar data presented herein, such data involve uncertainties and are subject to change based on various factors, including those discussed under the headings "Special Note Regarding Forward-Looking Statements" and "Risk Factors" in this prospectus. In this prospectus, we use the term "independent investment banks" or "independent advisors" to refer to investment banks primarily focused on advisory services and that conduct limited or no commercial banking or sales and trading activities. We use the term "global independent investment banks" to refer to independent investment banks with global coverage capabilities across all major industries and regions. We consider the global independent investment banks to be our publicly traded peers, Evercore Partners Inc., Greenhill & Co., Inc., Lazard Ltd, and us. Table of Contents MOELIS & COMPANY (Exact Name of Registrant as Specified in Its Charter) DELAWARE (State or Other Jurisdiction of Incorporation or Organization) 6199 (Primary Standard Industrial Classification Code Number) 46-4500216 (I.R.S. Employer Identification Number) 399 Park Avenue, 5th Floor New York, New York 10022 (212) 883-3800 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices) Table of Contents Our Market Opportunity We believe that we will continue to grow revenues and gain market share as a result of being well positioned to benefit from the following market forces: Growing Demand for Independent Advice: The demand for independent advice has increased dramatically in recent years. In 2013, independent advisors generated over 21% of the total advisory fee pool, up from less than 15% in 2009. Of the advisory revenue generated by independent advisors, Moelis & Company was responsible for almost 18% in 2013, up from less than 11% in 2009. We believe the shift toward independent advice has been driven largely by the actual or perceived conflicts at the large financial conglomerates where sizable sales and trading, underwriting and lending businesses coexist with an advisory business that comprises only a small portion of revenues and profits. We expect the momentum of the independent firms to continue as clients seek uncompromised confidential advice free of conflicts. We believe we are well positioned amongst the independent investment banks to deliver this advice given our global reach and product and industry depth. Ongoing Dislocation at Large Financial Conglomerates: We will seek to continue to take advantage of growth opportunities arising from the ongoing dislocation at large financial conglomerates. These firms face increasing regulation and the pressure of managing large disparate business divisions, leading to confidentiality challenges, higher operating costs, compensation limitations and increased capital constraints, all of which we believe adversely affect their ability to serve clients and compete for talented professionals. As these firms continue to struggle with these issues, we see tremendous opportunities to enhance our industry coverage, expand our geographic reach and add new advisory expertise. Steady Improvement in Mergers & Acquisitions Activity: While announced M&A volume was relatively restrained from the global financial crisis through 2013, we are seeing a steady improvement in the M&A environment driven by a stabilizing global macroeconomic environment, strong corporate balance sheets, attractive financing markets, a trend toward global consolidation and increased financial sponsor activity. We expect a more robust M&A environment to increase deal flow and enhance our growth. In addition, the recovery in Europe since the global financial crisis has lagged that of the U.S. We have made substantial investments in Europe, with over 60 advisory professionals in the region, while some of our competitors have scaled down their operations in Europe, and we believe we will be well positioned when the European M&A market rebounds. Continued Activity in Recapitalization and Restructuring Market: We believe that, given the amount of leverage (including floating rate instruments) that companies have issued in recent years, a steady recapitalization and restructuring market will exist if interest rates rise or credit markets become more difficult to access, even with an improving macroeconomic environment and a steady improvement in M&A activity. Both 2012 and 2013 represented record years of leveraged finance issuance in the U.S., and 2014 issuance continues to be strong, as companies take advantage of historically low borrowing costs to leverage their capital structures. We believe we are well positioned to assist companies through our holistic approach, which combines sector expertise with M&A, recapitalization and restructuring and other advisory capabilities, to provide solutions to clients in both robust and challenging economic environments. Our Key Competitive Strengths With 16 offices located around the world, capabilities in all major industries and deep advisory expertise, we believe we are well positioned to take advantage of the strong market opportunity for Osamu R. Watanabe Esq. General Counsel Moelis & Company 399 Park Avenue, 5th Floor New York, New York 10022 (212) 883-3800 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service) Table of Contents independent investment banks. Furthermore, we believe our business is differentiated from that of our competitors in the following respects: Globally Integrated Firm with Innovative Advisory Solutions: We provide the high-touch and conflict free benefits of an independent investment bank with the global reach, sector depth and product expertise more commonly found at larger financial institutions. With 16 offices located in North and South America, Europe, the Middle East, Asia and Australia, we combine local and regional expertise with international market knowledge to provide our clients with highly integrated information flow and strong cross-border capabilities. We harness the deep industry expertise and broad corporate finance experience of our 96 global Managing Directors, which include 59 former sector and product heads from major investment banks. We reinforce our model with a discretionary compensation structure that encourages a high degree of collaboration and our "One Firm" mentality. Advisory Focus with Strong Intellectual Capital: We primarily focus on advising clients, unlike most of our major competitors who derive a large percentage of their revenues from lending, trading and underwriting securities. We believe this independence allows us to offer advice free from the actual or perceived conflicts associated with lending to clients or trading in their securities. In addition, our focus on advisory services frees us from the pressure of cross-selling products, which we believe can distract from the dialogue with clients around their long-term strategy, compromising the advice. We provide intellectual capital based on our judgment, expertise and relationships combined with intense senior level attention to all transactions. The business of delivering intellectual capital allows us to operate a low risk and capital light model with attractive profit margins. We are not exposed to the financial risk and regulatory requirements that arise from, or the capital investments required in, balance sheet lending and trading activities. Fast Growing Global Independent Investment Bank: Since our inception in 2007, we have achieved rapid growth, earning revenues of $411 million and pre-tax income of $73 million in 2013. During this time however, the global financial crisis contributed to a 51% decrease in global completed M&A volume from the peak levels of 2007. We took advantage of the dislocation in the financial services industry following the global financial crisis and capitalized on the unique opportunity to hire Managing Directors who have on average 20 years of investment banking experience. We believe the quality and scale of our global franchise and the speed at which it has been achieved would be a challenge to replicate today. Strong Financial Discipline: We have remained financially disciplined with an intense focus on managing growth in a profitable manner, as demonstrated by the $73 million of pre-tax income achieved in our sixth full year of operations. We hired aggressively during the global financial crisis to take advantage of the dislocation among our competitors and have taken a more measured approach to hiring as the markets and compensation levels have stabilized. We incentivize our bankers as owners by awarding equity compensation in order to align the interests of our employees and equityholders, and our employees currently own a majority of our Company. Additionally, we have focused on entering new regions and sectors through creative and cost efficient strategies. We intend to maintain our financial discipline as we continue to grow our revenues, expand into new markets and increase our areas of expertise. Significant Organic Growth Opportunities: We have made significant investments in our intellectual capital with the hiring of 56 Managing Directors and promotion of 22 internal professionals to Managing Director since 2010. In addition, we have invested time and resources in our recruiting and training programs. We established a meaningful presence at the top undergraduate programs in our first year of operations, which has resulted in the hiring of over 250 analysts from campus since our inception. We are poised to continue realizing meaningful organic growth from these investments. We have achieved critical size in key industry sectors and regions around the globe, as Copies to: Joseph A. Coco, Esq. Stacy J. Kanter, Esq. Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 (212) 735-3000 Jay Clayton, Esq. Glen T. Schleyer, Esq. Sullivan & Cromwell LLP 125 Broad Street New York, New York 10004 (212) 558-4000 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents well as recognition for advising on innovative transactions, which have enhanced our brand globally. We are positioned to continue to grow revenues as a result of increased individual productivity as our investments in people mature and as we continue to leverage our global platform through enhanced connectivity and idea generation and expanded brand recognition. High Standard of Confidentiality and Discretion: Due to the highly sensitive nature of M&A discussions where confidentiality is of paramount importance to clients, the M&A business is most effectively operated on a "need to know" basis. We believe that large financial conglomerates with multiple divisions, "Chinese Walls" and layers of management have a significantly greater number of employees who have access to sensitive client information, which can increase the risk of confidential information leaking. Such leaks can materially impair the viability of transactions and other strategic decisions. We have established a high standard of confidentiality and discretion, as well as instituted procedures designed to protect our clients and minimize the risk of sensitive information leaking to the market. Diversified Advisory Platform: Our business is highly diversified across sectors, types of advisory services and clients. Our broad corporate finance expertise positions us to advise clients through any phase of their life cycle and in any economic environment. We focus on a wide range of clients from large public multinational corporations to middle market private companies to individual entrepreneurs, and we deliver the full resources of our firm and the highest level of senior attention to every client, regardless of size or situation. In addition, we have no meaningful client concentration, with our top 10 transactions representing only 23% of our revenues in 2013. Our holistic "One Firm" approach also reduces dependence on any one product or banker and allows us to leverage our intellectual capital across the firm as necessary to offer multiple solutions to our clients, increase our client penetration and adapt to changing circumstances. Partnership Culture: We believe that our momentum and commitment to excellence have created an environment that attracts and retains high quality talent. Our people are our most valuable asset and our goal is to attract, retain and develop the best and brightest talent in our industry across all levels. We strive to foster a collaborative environment, and we seek individuals who are passionate about our business and are a fit with our culture. We have established a compensation philosophy that reinforces our long-term vision and values by rewarding collaboration, client impact and lasting relationships and encourages employees to put the interests of our clients and our Company first. Above all, the "Moelis Standard" nurtures a culture of partnership, passion, optimism and hard work, which inspires the highest level of quality and integrity in every interaction with our clients and each other.
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before deciding to invest in our common stock. You should read the entire prospectus carefully, including Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and notes to those consolidated financial statements before making an investment decision. Some of the statements in this prospectus constitute forward-looking statements. For more information, see Special Note Regarding Forward-Looking Statements. Overview We are a technology company on a mission to automate the buying and selling of advertising. Our Advertising Automation Cloud is a highly scalable software platform that powers and optimizes a leading marketplace for the real time trading of digital advertising between buyers and sellers. Through the speed and big data analytics of our algorithm-based solution, we have transformed the cumbersome, complex process of buying and selling digital advertising into a seamless automated process that optimizes results for both buyers and sellers. Buyers of digital advertising use our platform to reach 97% of Internet users in the United States and over 600 million Internet users globally on some of the world s leading websites and applications. Sellers of digital advertising use our platform to maximize revenue from advertising, decrease costs and protect their brands and user experience, while accessing a global market of buyers representing over 100,000 brands since our inception. The benefits we provide to both buyers and sellers, and the time and effort spent by both buyers and sellers to integrate with our platform and associated applications, give us a critical position in the digital advertising ecosystem. Our Advertising Automation Cloud incorporates proprietary machine-learning algorithms, sophisticated data processing, high volume storage, detailed analytics capabilities, and a distributed infrastructure. We analyze billions of data points in real time to enable our solution to make approximately 300 data-driven decisions per transaction in milliseconds, and to execute up to 2.5 million peak queries per second, approximately 25 billion transactions per week and 3 trillion bid requests per month. Our Advertising Automation Cloud features applications for digital advertising sellers, including websites, applications and other digital media properties, to sell their advertising inventory; applications for buyers, including demand side platforms, or DSPs, ad networks and advertising agencies, to buy advertising inventory; and an exchange over which such transactions are executed. Together, these features power and optimize a comprehensive, transparent, independent advertising marketplace that brings buyers and sellers together and facilitates intelligent decision-making and automated transaction execution for the advertising inventory we manage on our platform. We believe we help increase the volume and effectiveness of advertising, increasing revenue for sellers and improving return on advertising investment for buyers. We have direct relationships built on technical integration with over 700 sellers of digital advertising, including approximately 40% of the U.S. comScore 100, which is a list of the top U.S. digital sellers by reach. We believe that our direct relationships and integration with sellers, which differentiate us from many other participants in the advertising ecosystem, make us a vital participant in the digital advertising industry. Our integration of sellers into our platform gives sellers the ability to monetize a full variety and volume of inventory. At the same time, buyers leverage our platform to manage their advertising spending, simplify order management and campaign tracking, obtain actionable insights into audiences for their advertising and access impression level purchasing from hundreds of sellers. We believe buyers need our platform because of our powerful solution and our direct relationships and integration with some of the world s largest websites and applications. Our solution is constantly self-optimizing based on our ability to analyze and learn from vast volumes of data. The additional data we obtain from the volume of transactions on our platform help make our machine-learning algorithms more intelligent, leading to higher quality matching between buyers and sellers, better return on investment for buyers Table of Contents The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling stockholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any state where the offer or sale is not permitted. PROSPECTUS (Subject to Completion) Issued March 20, 2014 6,770,995 Shares COMMON STOCK The Rubicon Project, Inc. is offering 5,416,796 shares of common stock and the selling stockholders named in this prospectus are offering 1,354,199 shares of common stock. We will not receive any proceeds from the sale of shares by the selling stockholders. This is our initial public offering and no public market currently exists for our common stock. We anticipate that the initial public offering price will be between $15.00 and $17.00 per share. Our common stock has been approved for listing on the New York Stock Exchange under the symbol RUBI. We are an emerging growth company as defined under the federal securities laws and are subject to reduced public company reporting requirements. Investing in our common stock involves risks. See Risk Factors beginning on page 16. PRICE $ PER SHARE Initial public offering price Underwriting discount (1) Proceeds to us (before expenses) Proceeds to the selling stockholders (before expenses) Per Share $ $ $ $ Total $ $ $ $ (1) See Underwriting for a description of compensation payable to the Underwriters. We have granted the underwriters the right to purchase up to an additional 1,015,649 shares of common stock to cover over-allotments. The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares of common stock to purchasers on or about , 2014. MORGAN STANLEY GOLDMAN, SACHS & CO. RBC CAPITAL MARKETS Needham & Company Oppenheimer & Co. LUMA Securities , 2014 Table of Contents and higher revenue for sellers. As a result of that high quality matching, we attract even more sellers which in turn attracts more buyers and vice versa. We believe this self-reinforcing dynamic creates a strong platform for growth. The historical and real time data we derive from the over 700 seller integrations, 25 billion transactions per week, 3 trillion bid requests per month and 600 million Internet users globally that interact with our platform per month inform our machine-learning algorithms to create a size, scale and capability that is difficult to replicate. We believe we are positioned to take advantage of several trends in the advertising industry, including the shift in advertising spending from analog to digital advertising, the move towards automation and the convergence of media across multiple channels. The display, mobile and video digital advertising market is projected to grow to $90 billion by 2017, and the need for automation in this market is growing commensurately, with real time bidding alone projected to grow at a compounded annual growth rate of 57% from $1.4 billion in 2011 to $20.8 billion in 2017. In 2013, our revenue was $83.8 million, a 47% increase over 2012, and we recorded a net loss of $9.2 million and Adjusted EBITDA of $11.2 million. In 2012, our revenue was $57.1 million, a 54% increase over 2011, and we recorded a net loss of $2.4 million and Adjusted EBITDA of $9.2 million. In 2011, our revenue was $37.1 million, and we recorded a net loss of $15.4 million and negative Adjusted EBITDA of $6.7 million. For information on Adjusted EBITDA, and a reconciliation of Adjusted EBITDA to net loss on the basis of accounting principles generally accepted in the United States, or GAAP, please refer to Summary Consolidated Financial and Other Data. Advertising spending transacted on our platform has grown significantly. Managed revenue is an operational measure that represents this advertising spending. Managed revenue would represent our revenue if we were to record our revenue on a gross basis instead of a net basis. Managed revenue does not represent revenue reported on a GAAP basis. We review managed revenue for internal management purposes to assess market share and scale and to compare our performance to others in our industry that report revenue on a gross basis. In 2013, our managed revenue was $485.1 million, which represents a 43% increase over managed revenue of $338.9 million in 2012. Our managed revenue of $338.9 million in 2012 represents a 42% percent increase over managed revenue of $238.8 million in 2011. Our Industry Shift Towards Digital Advertising. In response to consumers spending more time consuming digitally delivered content over the Internet, mobile networks and digital television, the advertising industry is in the midst of a decades-long shift from advertising in analog and print media, like print newspapers, magazines, broadcast radio and television, to digital advertising. As a result of the vast amount of audience data available, digital advertising has the potential to drive return on advertising investment for advertisers many times higher than print, broadcast radio and television. Technological advances are also enabling sellers to optimize and expand the monetization of their inventory. Development of a Complex Digital Advertising Ecosystem Comprising a Large Number of Buyers, Sellers and Other Participants. Advertisers and sellers of advertising inventory have come to rely on a complex ecosystem made up of multiple technology and service providers, as described below. Buyers: At one end of the ecosystem, spending begins with advertisers, who often engage advertising agencies to help plan and execute their digital advertising campaigns. Buyers include agencies as well as advertiser aggregators through which agencies traditionally execute their digital advertising campaigns, including DSPs, ad networks and agency trading desks, or ATDs. Table of Contents Table of Contents Sellers: At the other end of the ecosystem, sellers create websites and applications that contain viewable space for advertisements, or impressions, that can be delivered to users as they visit and navigate through websites and applications. These impressions can be sold to buyers either in advance via manual or automated direct sales efforts, or in real time on an impression-by-impression basis via a third-party through the digital advertising ecosystem. Other Sell-Side Participants: Sellers may use additional sell-side representatives to connect with buyers, such as supply side platforms, or SSPs, and ad servers. Exchanges: Buyers and sellers may sometimes come together through an exchange that matches and presents available impressions to buyers. Costs, Inefficiencies and Lack of Transparency Inherent in Existing Ecosystem. This ecosystem of various buyers, sellers and other intermediaries has helped advertisers access digital media, but it is inefficient and has fallen short of truly enabling them to take advantage of the full potential of digital advertising. We believe, based on industry research, that only approximately $0.40 of every dollar spent by an advertiser is ultimately realized by the seller. Complicated and Manual Workflow for Buying and Selling Digital Advertising. Despite significant technological advances with respect to delivery of digital advertising, the process of planning and executing a digital advertising campaign remains cumbersome and highly manual. These manual and complicated workflows lead to inefficiencies, wasted dollars for sellers and lost opportunities for advertisers to reach users. According to NextMark, it can cost an advertiser up to $40,000 and 480 man-hours to plan and execute a $500,000 advertising campaign. Digital Advertising is Complex and Challenging to Automate Due to the size and complexity of the advertising ecosystem and purchasing process, manual processes can no longer effectively optimize or manage digital advertising. This has created a need to automate the digital advertising industry and to simplify the process of buying and selling advertising. However, a number of factors make digital advertising complex and challenging to automate: Perishable Inventory. The inventory of available impressions is highly perishable due to the fact that each impression must be valued, auctioned, successfully purchased, and then the winning bidder must be notified and must serve the advertisement, all in the split second between the time a user types in a web-address or is redirected to a website or application and the time the page is loaded. Complex Impression Level Matching. In order for buyers to maximize their ability to target specific audiences and for sellers to optimize their revenue, there is a need for a technology solution that can match buyer and seller objectives at a large scale to optimize the delivery of advertising on an impression-by-impression basis. Large Multi-Variate Datasets. The volume of data available to optimize digital advertising is enormous, and buyers and sellers need a solution capable of analyzing, processing and interpreting these large amounts of data and executing buy and sell orders informed by such data, all in real time. Fragmented Buyer and Seller Base. The enormous variety of buyers and sellers in the digital advertising industry has created a need for a solution that is capable of seamlessly connecting a highly fragmented global buyer and seller base. Brand Security and User Experience Concerns. Both buyers and sellers need a solution that is capable of following specified rules established by buyers and sellers to maintain brand integrity and deliver relevant advertisements that create a positive user experience, while efficiently executing a large volume of transactions. Table of Contents Table of Contents Large and Highly Unpredictable Traffic Volumes. Sellers need a platform that can effectively respond to and monetize inventory during unpredictable spikes in user volumes. Lack of Standardized Ad Formats and Data. An available advertising impression can vary based on a variety of factors, and buyers and sellers require a platform that can on a real time basis match the large assortment of available advertising impressions with potential buyers. Rubicon Project: Our Advertising Automation Cloud Enables the Digital Advertising Marketplace Rubicon Project was founded to address the challenges associated with the digital advertising ecosystem and to enable a marketplace where buyers and sellers of advertising can readily buy and sell advertising on an automated basis. Our Advertising Automation Cloud optimizes the sale and purchase of advertising across a full spectrum of inventory for all types of buyers and sellers and across all devices. We believe there are few market participants that are directly integrated with sellers in a way that allows sellers to make a wide range and volume of advertising inventory readily available in the marketplace. Our solution enables buyers and sellers to transact through our comprehensive automation offerings including real time bidding, or RTB, static bidding and direct orders. Our solution integrates RTB, static bidding and direct order offerings into a unified auction across all types of buyers, while matching available impressions with advertisements based upon various criteria. Our solution can complete the many steps and analyses required to execute a typical digital advertising transaction within an average of approximately 80 milliseconds. Big Data Analytics and Machine-Learning Algorithms. We have developed proprietary machine-learning algorithms that analyze billions of data points from our massive data repositories to enable our solution to make approximately 300 real time data-driven decisions per transaction and to execute approximately 3 trillion bid requests per month. Dual Network Effects Drive an Efficient and Self-Optimizing Marketplace. Our solution is constantly self-optimizing based on our ability to analyze and learn from vast volumes of data. The additional data we obtain from the volume of transactions on our platform helps make our machine-learning algorithms more intelligent, leading to higher quality matching between buyers and sellers, better return on investment for buyers and higher revenue for sellers. As a result of that high quality matching, we attract even more sellers, which in turn attracts more buyers, and vice versa. We believe this self-reinforcing dynamic creates a strong platform for growth. Critical Position in Digital Advertising Ecosystem. In order to maximize the monetization of the full range and volume of their advertising inventory through our platform, gain actionable insights from the data we have amassed and consolidate and compile payments and billing, sellers integrate into our platform in a way that we believe would cause them to experience high switching costs to move large volumes of their inventory to a new platform. At the same time, we believe that buyers need our platform to benefit from our powerful solution and our direct relationships and integration with some of the world s largest websites and applications. The benefits we provide to both buyers and sellers, and the time and effort spent by both buyers and sellers to integrate with our applications, give Rubicon Project a critical position in the digital advertising ecosystem. Platform Applications To enhance the value our Advertising Automation Cloud brings to the marketplace, we offer a growing set of applications to address the critical needs of buyers and sellers: Applications for Sellers. We have direct relationships and integration with the sellers on our platform and provide applications to help them increase their digital advertising revenue, reduce costs, protect their brands and user experience, and reach more buyers efficiently. Sellers realize the following benefits from our platform: Maximized revenue for a broad range of digital advertising inventory without volume or geographic constraints. Table of Contents Table of Contents Automated sales with leading buyers via RTB, static bidding and direct orders. Integrated solution for digital advertising needs. Significantly streamlined sales, operations and finance workflow. Brand security. Enhanced user experience through delivery of relevant advertisements. Advanced reporting and analytics and actionable insights. Consolidated payments and transparent tracking and billing system. Applications for Buyers. Buyers leverage our applications to access a large audience and to purchase advertising inventory based on their key demographic, economic, and timing criteria, allowing them to streamline their purchasing operations, increase the efficiency of their spending and the effectiveness of their advertising campaigns. Buyers realize the following benefits from our platform: Direct access to a global audience and hundreds of premium sellers. Ability to purchase via RTB, static bidding or direct orders. Ability to integrate existing buying technologies or buy directly through us. Optimized return on investment by consolidating spending on one platform. Simplified order management and campaign tracking. Transparency and control over advertising spending. Brand security. Our Market Opportunity We believe that important trends greatly enhance our market opportunity, namely: the shift in advertising spending to digital advertising, the move towards automation and the convergence of media across multiple channels. Rapid Growth in Digital Advertising Spending. As media consumption shifts to digital delivery via the Internet, digital television and mobile devices, digital advertising spending is growing at a significantly faster rate than advertising spending on analog and print media. We believe that there will be continued expansion of digital advertising as advertising spending catches up to time spent on the Internet and mobile devices. According to the PwC Entertainment and Media Global Outlook: 2013-2017, published in June 2013, display, mobile and video digital advertising are forecasted to grow from approximately $43 billion in 2012 to $90 billion in 2017, a 16% compounded annual growth rate, and our calculations based on data from eMarketer indicate that the current opportunity for monetizing online media consumption is over $32 billion annually in the United States. Increasing Demand for Automation and Real Time Purchase and Sale of Advertising. As digital advertising has grown in complexity, the need for automation has increased commensurately. According to International Data Corporation, or IDC (October 2013), global RTB spending by advertisers is expected to grow from $1.4 billion in 2011 to $20.8 billion in 2017, a compounded annual growth rate of 57%. RTB is just one aspect of advertising automation, and static bidding and direct orders can also benefit significantly from automation. Trend Towards Automation of Analog and Print Advertising Markets. Over time, we also expect analog and print advertising markets to automate, and we view our long-term mission, and opportunity, as the Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+F-1/A 1 d655315df1a.htm AMENDMENT NO. 5 TO FORM F-1 Amendment No. 5 to Form F-1 Table of Contents As filed with the Securities and Exchange Commission on June 23, 2014 Registration No. 333-194982 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 5 to Form F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 MATERIALISE NV (Exact name of Registrant as specified in its charter) Kingdom of Belgium 7372 Not Applicable (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) Technologielaan 15 3001 Leuven Belgium 32 (16) 39 66 11 (Address, including zip code, and telephone number, including area code, of Registrant s principal executive offices) Materialise USA, LLC 44650 Helm Ct. Plymouth, Michigan 48170 Attention: Chief Executive Officer (734) 259-6445 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Alejandro E. Camacho, Esq. Per B. Chilstrom, Esq. Clifford Chance US LLP 31 West 52nd Street New York, New York 10019 (212) 878-8000 William F. Schwitter, Esq. Paul Hastings LLP 75 East 55th Street New York, New York 10022 (212) 318-6000 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission acting pursuant to said Section 8(a) may determine. Table of Contents The information in this prospectus is not complete and may be changed. We and the selling shareholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to completion, dated June 23, 2014 8,000,000 American Depositary Shares Representing 8,000,000 Ordinary Shares Materialise NV $ per American Depositary Share Materialise NV, a Belgian limited liability company, is offering 8,000,000 American Depositary Shares, or ADSs. Each ADS will represent one ordinary share with no nominal value per share. We anticipate that the initial public offering price will be between $12.00 and $14.00 per ADS. This is our initial public offering and no public market currently exists for the ADSs or our ordinary shares. Proposed trading symbol: NASDAQ Global Market MTLS This investment involves risk. See Risk Factors beginning on page 18. Per ADS Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to Materialise NV $ $ (1) We have agreed to reimburse the underwriters for certain expenses in connection with this offering. See Underwriting. The underwriters have a 30-day option to purchase up to 1,200,000 additional ADSs from the selling shareholders identified in this prospectus to cover over-allotments, if any. We will not receive any proceeds from the sale of ADSs by the selling shareholders. We are an emerging growth company as that term is defined in the Jumpstart Our Business Startups Act of 2012 and, as such, will be subject to reduced public company reporting requirements for future filings. See Prospectus Summary Implications of Being an Emerging Growth Company. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Delivery of the ADSs will be made against payment in New York, New York on or about , 2014. Piper Jaffray Credit Suisse BB&T Capital Markets Janney Montgomery Scott Stephens Inc. KBC Securities USA The date of this prospectus is , 2014. Table of Contents Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+elsewhere in this prospectus. Capitalized terms used but not defined in this summary are defined in this prospectus. Investors should consider this prospectus in its entirety, including the information referred to under Management s Discussion and Analysis of Financial Condition and Results of Operations and Risk Factors, and the financial statements included elsewhere herein, prior to making an investment in our common shares. The basis of certain information in this prospectus regarding industry share and our position relative to our competitors is described under Industry, Ranking and Other Data. In this prospectus, unless the context indicates otherwise, the term Company refers (i) as of any time prior to the change of legal form to a Luxembourg joint stock corporation (soci t anonyme or S.A) as described below, to Orion Engineered Carbons S. r.l. and (ii) as of any time after the change of legal form to Orion Engineered Carbons S.A., and the terms Orion, we, our, us and the Group refer to the Company and its consolidated subsidiaries. Our fiscal year is a calendar year. Overview We are a leading global producer of carbon black. Carbon black is a form of carbon used to improve certain properties of materials into which it is added. It is used as a pigment and as a performance additive in coatings, polymers, printing and special applications (specialty carbon black) and in the reinforcement of rubber in tires and mechanical rubber goods (rubber carbon black). Historically, our business operated as a business line of Evonik and was acquired from Evonik on July 29, 2011 (the Acquisition ) by investment funds managed by affiliates of Rh ne Capital L.L.C. (the Rh ne Investors ) and investment funds managed directly or indirectly by Triton Managers III Limited and TFF III Limited (the Triton Investors ). Prior to the Acquisition, the Company had no operations. In 2013 and the three months ended March 31, 2014, we generated revenue of 1,339.6 million and 330.5 million on sales volume of 968.3 kilo metric tons ( kmt ) and 249.3 kmt, respectively, Adjusted EBITDA of 191.1 million and 50.0 million, respectively, and a loss for the periods of 19.0 million and 0.4 million, respectively. We operate a diversified carbon black business with more than 280 specialty carbon black grades and approximately 80 rubber carbon black grades. Our product portfolio is one of the broadest in the industry and is divided into the following segments: Specialty Carbon Black. We are one of the largest global producers of specialty carbon black with an estimated share of global industry sales of approximately 23% in 2013 measured by volume in kmt. We believe that our share of global industry sales measured by revenue is higher, since our product portfolio is weighted towards higher priced premium grades. We manufacture specialty carbon black at multiple sites for a broad range of specialized applications. Specialty carbon black imparts specific characteristics, such as high-quality pigmentation, ultraviolet ( UV ) light protection, viscosity control and electrical conductivity. In 2013 and the three months ended March 31, 2014, Adjusted EBITDA for our Specialty Carbon Black segment was 98.0 million and 25.7 million, respectively, and the Segment Adjusted EBITDA Margin was 25.1% and 25.2%, respectively. This segment accounted for 29.1% and 30.9% of our total revenue, 51.3% and 51.4% of our total Adjusted EBITDA and 19.7% and 20.4% of our sales volume in kmt in 2013 and the three months ended March 31, 2014, respectively. Rubber Carbon Black. We are one of the largest global producers of rubber carbon black. We have a global supply network and an estimated share of global industry sales of approximately 7% in 2013 measured by volume in kmt, with industry sales shares by volume equal to or exceeding 17% in each of our major operating regions. In 2013 and the three months ended March 31, 2014, Adjusted EBITDA Table of Contents The information in this preliminary prospectus is not complete and may be changed. The Selling Shareholder identified in this preliminary prospectus may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any jurisdiction where such offer or sale is not permitted. PROSPECTUS (Subject to Completion) Dated July 21, 2014 ORION ENGINEERED CARBONS S.A. 18,000,000 COMMON SHARES This is the initial public offering of common shares of Orion Engineered Carbons S.A. (the Company ). The common shares are being offered by Kinove Luxembourg Holdings 1 S. r.l., referred to herein as Kinove Holdings or the Selling Shareholder. The Company will not receive any proceeds from the sale of common shares by the Selling Shareholder. This is the initial public offering of our common shares and no public market for our common shares exists. We anticipate that the initial public offering price will be between $21 and $24 per common share. We have applied to list the common shares on the New York Stock Exchange (the NYSE ) under the symbol OEC . Currently, the Company is named Orion Engineered Carbons S. r.l., and is a Luxembourg limited liability company (soci t responsabilit limit e). Following the date of this prospectus, but prior to the completion of this offering, the Company will change its legal form to become a Luxembourg joint stock corporation (soci t anonyme or S.A.) and will change its name to Orion Engineered Carbons S.A. Investing in the common shares involves risks. See Risk Factors beginning on page 18. Price to Public Underwriting Discounts and Commissions(1) Proceeds, before Expenses, to Selling Shareholder Proceeds, after Expenses, to Selling Shareholder Per Common Share $ $ $ $ Total $ $ $ $ (1) We have agreed to reimburse the underwriters for certain FINRA-related expenses. See Underwriting. The Selling Shareholder has granted the underwriters the right to purchase up to an additional 2,700,000 common shares at the initial public offering price less the underwriting discount. The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the common shares to purchasers on , 2014. MORGAN STANLEY GOLDMAN, SACHS & CO. UBS INVESTMENT BANK Barclays J.P. Morgan KeyBanc Capital Markets Macquarie Capital , 2014 Table of Contents NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains and refers to certain forward-looking statements with respect to our financial condition, results of operations and business. Forward-looking statements are statements of future expectations that are based on management s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among others, statements concerning the potential exposure to market risks, statements expressing management s expectations, beliefs, estimates, forecasts, projections and assumptions and statements that are not limited to statements of historical or present facts or conditions. Forward-looking statements are typically identified by words such as anticipate, believe, could, estimate, expect, intend, may, plan, objectives, outlook, probably, project, will, seek, target and other words of similar meaning. These forward-looking statements include, without limitation, statements about the following matters: our strategies for (i) strengthening our position in specialty carbon blacks and rubber carbon blacks, (ii) increasing our rubber carbon black margins and (iii) strengthening the competitiveness of our operations; the proposed acquisition of QECC (as defined below); the proposed Refinancing (as defined below); the outcome of the tax audit in respect of our South Korean operations and its impact on the Company; the outcome of any pending or possible litigation or regulatory proceedings, including the U.S. Environmental Protection Agency (the EPA ) enforcement action described herein; and our expectation that the markets we serve will continue to grow. All these forward-looking statements are based on estimates and assumptions that, although believed to be reasonable, are inherently uncertain. Therefore, undue reliance should not be placed upon any forward-looking statements. There are important factors that could cause actual results to differ materially from those contemplated by such forward-looking statements. These factors include, among others: negative or uncertain worldwide economic conditions; volatility and cyclicality in the industries in which we operate; operational risks inherent in chemicals manufacturing, including disruptions as a result of severe weather conditions and natural disasters; our dependence on major customers; our ability to compete in the industries in which we operate; our ability to develop new products and technologies successfully and the availability of substitutes for carbon black; our ability to implement our business strategies; Table of Contents for our Rubber Carbon Black segment was 93.2 million and 24.3 million, respectively, and Segment Adjusted EBITDA Margin was 9.8% and 10.6%, respectively. This segment accounted for 70.9% and 69.1% of our total revenue, 48.7% and 48.6% of our total Adjusted EBITDA and 80.3% and 79.6% of our total sales volume in kmt in 2013 and the three months ended March 31, 2014, respectively. We have over 75 years of experience and enjoy a long-standing reputation for technical capability in the carbon black industry and its served applications. Our experience has enabled us to develop our core competencies and proprietary technologies across the carbon black value chain. We provide consistent product quality, reliability, technical expertise and innovation, built upon continually improving processes and know-how through our advanced innovation group (the Innovation Group ), which includes our research and development ( R&D ), applications technology and process development teams, and through supply chain execution. Our Innovation Group works closely with our customers to develop innovative products and applications, while strengthening customer relationships and improving communication. Long-term R&D alliances and sophisticated technical interfaces with customers allow us to develop solutions to meet specific customer requirements. As a result, we have been able to generate attractive margins for our specialized carbon black products. Additionally, our Innovation Group works closely with our operations group to improve process economics with new process equipment designs, operating techniques and raw material selection. We operate a modern global supply chain network comprising 13 wholly-owned production plants and one jointly-owned production plant. We are currently seeking to acquire the Chinese carbon black manufacturer Qingdao Evonik Chemicals Co. Ltd. ( QECC ), in which Evonik has a majority interest. The acquisition is subject to negotiations with Evonik and between Evonik and its joint venture partner, as well as Chinese government review, and we are unable to predict whether or when the acquisition will occur or whether completion of the acquisition is probable. We believe that this acquisition, if completed, would improve our ability to serve the Chinese market over and above our current use of our global network for exports to China. See Risk Factors Risks Related to Our Business We may not be able to compete successfully in the industries and markets in which we operate. The charts below illustrate our revenues (including freight charges) by geographic location of customers for 2013, and our Adjusted EBITDA by segment for the two most recent reported periods, 2013 and the three months ended March 31, 2014: Table of Contents volatility in the costs and availability of raw materials and energy; our ability to realize benefits from investments, joint ventures, acquisitions or alliances; information technology systems failures, network disruptions and breaches of data security; our relationships with our workforce, including negotiations with labor unions, strikes and work stoppages; our ability to recruit or retain key management and personnel; our exposure to political or country risks inherent in doing business in some countries; environmental, health and safety regulations, including nanomaterial and greenhouse gas emissions regulations, and the related costs of maintaining compliance and addressing liabilities; current and potentially future investigations and enforcement actions by the EPA; our operations as a company in the chemical sector, including the related risks of leaks, fires and toxic releases; litigation or legal proceedings, including product liability and environmental claims; our ability to protect our intellectual property rights; our ability to generate the funds required to service our debt and finance our operations; fluctuations in foreign currency exchange and interest rates; the availability and efficiency of hedging; changes in international and local economic conditions, including with regard to the Euro and the Eurozone debt crisis, dislocations in credit and capital markets and inflation; potential impairments or write-offs of certain assets; required increases in our pension fund contributions; the adequacy of our insurance coverage; changes in our jurisdictional earnings mix or in the tax laws of those jurisdictions; our indemnities to and from Evonik (as defined below); challenges to our decisions and assumptions in assessing and complying with our tax obligations; the absence of a previous public market for our common shares; potential conflicts of interests with our principal shareholders; and our status as a foreign private issuer. In light of these risks, our results could differ materially from the forward-looking statements contained in this prospectus. For further information regarding factors that could affect our business and financial results and the related forward-looking statements, see Risk Factors. Table of Contents Our Strengths We believe that the factors set forth below provide us with a competitive advantage. Leading Industry Positions in the Growing Specialty and Rubber Carbon Black Markets We are one of the largest global producers of specialty carbon black with an estimated share of global industry sales of approximately 23% in 2013, measured by sales volume in kmt. We are the third largest producer of rubber carbon black in the world and we have a global rubber carbon black distribution network. We had an estimated share of global industry sales in rubber carbon black of approximately 7% in 2013 measured by volume in kmt. Rubber carbon black sales are largely regional, since transportation costs are high relative to sales prices. We believe that in most of our key operating regions, our estimated rubber carbon black share of industry sales is higher than our global share based on volumes in kmt: approximately 17% in the European Union, 18% in North America, 35% in South Korea, 96% in South Africa and 19% in Brazil in 2013. We expect the markets we serve to continue growing. Our Specialty Carbon Black segment provides the polymers, printing, coatings and special applications markets with highly customized, application-driven products that impart specific product characteristics, such as high-quality durable pigmentation, UV protection, viscosity control and conductivity. We expect these markets to continue growing because of increasing urbanization, changing packaging requirements and higher quality consumer demands. Our Rubber Carbon Black segment serves the tires and mechanical rubber goods markets and should continue to benefit from increasing mobility trends around the globe, which tend to increase demand for original-equipment tires, and from the larger, more stable market for replacement-tires. Leading Technology and Product Innovation Platform that Drives Higher Margin, Specialty Niche Product Offering We have a long-standing reputation in the industry for production expertise and applications knowledge. Our know-how allows us to develop high-quality products tailored to meet customer requirements. We have state-of-the-art research facilities, including pilot plants, simulation technologies and sophisticated testing laboratories where we develop new products, and improve process efficiencies that help improve sales and realize cost savings. Our Innovation Group works closely with our clients to develop innovative products and applications. We believe that this collaboration provides us with an understanding of customer needs and improved industry knowledge, reducing time to market for new products. In 2013, we reorganized and consolidated our Innovation Group in one location in Germany (with branch technical centers in the United States, South Korea and China) and placed it under the leadership of a newly hired Senior Vice President Innovation. This reorganization strengthens cooperation among our R&D, applications technology and process development teams to facilitate innovation and bring new products to market faster. Carbon black product properties are influenced by the choice of production technology and operating parameters. We believe that we have the largest array of production and treatment technologies and therefore one of the broadest product offerings in the industry, including products for specialized niche applications and end-uses in higher value sectors. At present, we believe that we are the only global carbon black producer with the ability to produce specialty carbon black using the current four production processes: furnace, gas, lamp and thermal black. Global, Well Invested and Flexible Production Network In 2013, we generated approximately 34% of our revenue by sales in Europe, 28% in North America, 23% in Asia, 7% in Brazil, 5% in Africa and the remainder elsewhere. Our production footprint supports this sales pattern as we operate a modern global supply chain network of four plants in the United States, two in South Korea, two in Germany (one wholly-owned and one jointly-owned) and one each in Brazil, Poland, Italy, Table of Contents All subsequent forward-looking statements are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement. New risk factors and uncertainties emerge from time to time and it is not possible for our management to predict all risk factors and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information, other than as required by applicable law. Table of Contents France, Sweden and South Africa. This global manufacturing presence and sales reach provides us with a competitive platform to serve our customers. Our broad geographical presence supports global purchasing and expands our access to different feedstock sources around the world. Our broad presence allows us to compete regionally on a cost-effective basis because of the relatively high transportation costs of rubber carbon black, which make most inter-regional shipments less competitive. Our global supply network allows us to quickly establish credentials with customers in new locations and those seeking consistent supply across regions. For example, a customer that uses our products in Asia recently opened new facilities in the United States and purchased our product for the new facilities as well. Similar facilities built by Asian producers in Europe and by Japanese producers in China have also sought our materials. In specialty carbon blacks, we have been successful in translating grades for global customers produced in one region to another production site due to the strength of our reputation, our technical support and our consistent global quality. The geographic diversity of our operations lowers our dependency on any particular region. Our specialty carbon black production sites are located in strategic parts of Europe, North America and Asia and serve customers globally, with plants, technical application staff and labs in close proximity to key customer sites. The scale and breadth of our product offering positions us to take advantage of favorable trends in both developed and emerging countries. We believe we are well placed to serve the key emerging growth markets through our manufacturing presence in South America (Brazil), Sub-Saharan Africa (South Africa), Asia (South Korea) and Eastern Europe (Poland). The acquisition of QECC, if completed, would improve our presence in China. In addition, following the Acquisition, we established a presence in Malaysia, Thailand, India and the UAE and are scheduled to open a business office in Indonesia by the end of 2014. Our diverse and flexible production and sales network also lowers our dependency on individual products, raw materials and end-uses. We have recently invested in strategic sites to increase the capacity and flexibility of our production platform. For example, we increased our capacity by adding a new rubber carbon black production line in South Korea, which freed capacity in existing units for potential further specialty carbon black production. This line began operations in 2013. We are also making incremental capacity increases at various sites in the United States, Brazil and Southern Europe to meet demand from tire and mechanical rubber goods producers. In addition, in 2014, we commissioned a specialty carbon black after-treatment facility in Germany for higher margin products and are currently revamping a rubber carbon black line in Texas to produce specialty carbon black grades. These improvements allow us to opportunistically shift our capacity to produce higher margin products. Since the Acquisition and until the end of 2013, we invested 165.5 million to upgrade, make more flexible and streamline our production network, to install cost-saving features such as energy recovery equipment and to provide for technological innovation in our manufacturing process. Long-standing, Deep Relationships with Blue-chip Customer Base We are a supplier to approximately 1,000 customers and operate in more than 90 countries, and have been a long-term supplier to many blue-chip companies. We serve approximately 700 customers in our Specialty Carbon Black segment and approximately 300 customers in our Rubber Carbon Black segment. We serve many of the largest, strategically positioned, global users of carbon black, many for over 30 years, including BASF, PolyOne and AkzoNobel in specialty carbon black products, Bridgestone, Goodyear and Michelin in tires and Cooper Standard, Hexpol and Hwaseung in mechanical rubber goods. We believe that our reputation results from our focus on high product quality, consistency, reliability and innovation and our ability to customize our products, combined with locally-based technical product and applications support and key account management. We believe that these qualities have helped us achieve a preferred supplier status with many blue-chip customers. Specialty and rubber carbon black applications require rigorous testing and approval processes, some of which can be lengthy. We believe that these processes, as well as the high degree of customization for a number of our products, help promote long-term customer relationships. Table of Contents PRESENTATION OF FINANCIAL AND OTHER INFORMATION The Company (also referred to in this prospectus as the Successor ) was incorporated on April 13, 2011. On July 29, 2011, the Company completed the acquisition from Evonik Industries AG ( Evonik ) of its carbon black business line (referred to in this prospectus as Evonik Carbon Black or the Predecessor ). In this prospectus, references to Euro and are to the single currency adopted by participating member states of the European Union relating to Economic and Monetary Union, references to $ , US$ and U.S. Dollars are to the lawful currency of the United States of America and references to Korean Won are to the lawful currency of the Republic of Korea. Non-IFRS Financial Measures The financial statements included in this prospectus were prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board ( IFRS ). In this prospectus, we present certain financial measures that are not recognized by IFRS and that may not be permitted to appear on the face of IFRS-compliant financial statements or notes thereto. The non-IFRS financial measures used in this prospectus are Contribution Margin, Contribution Margin per Metric Ton (collectively, Contribution Margins ), Adjusted EBITDA, Net Working Capital and Capital Expenditures. We define Contribution Margin as revenue less variable costs (raw materials, packaging, utilities and distribution costs). We define Contribution Margin per Metric Ton as Contribution Margin divided by sales volume measured in metric tons. We define Adjusted EBITDA as operating result (EBIT) before depreciation and amortization, adjusted for acquisition related expenses, restructuring expenses, consulting fees related to group strategy, share of profit or loss of associates and certain other items. Adjusted EBITDA is defined similarly in the indenture governing our senior secured notes due 2018 (the Senior Secured Notes ). Adjusted EBITDA is used by our management to evaluate our operating performance and make decisions regarding allocation of capital because it excludes the effects of certain items that have less bearing on our underlying business performance. We define Net Working Capital as inventories plus current trade receivables minus trade payables. We define Capital Expenditures as Cash paid for the acquisition of intangible assets and property, plant and equipment as shown in the consolidated financial statements. We also use Segment Adjusted EBITDA Margin, which we define as Adjusted EBITDA for the relevant segment divided by the revenue for that segment. Adjusted EBITDA for our segments and Segment Adjusted EBITDA Margin are financial measures permitted under IFRS. We use Adjusted EBITDA, Contribution Margins and Net Working Capital, as well as Adjusted EBITDA by segment and Segment Adjusted EBITDA Margin, as internal measures of performance to benchmark and compare performance among our own operations. We use these measures, together with other measures of performance under IFRS, to compare the relative performance of operations in planning, budgeting and reviewing the performance of our business. We believe these measures are useful measures of financial performance in addition to consolidated profit (or loss) for the period, operating result (EBIT) and other profitability measures under IFRS because they facilitate operating performance comparisons from period to period and company to company and, with respect to Contribution Margin, eliminate volatility in feedstock prices. By eliminating potential differences in results of operations between periods or companies caused by factors such as depreciation and amortization methods, historic cost and age of assets, financing and capital structures and taxation positions or regimes, we believe that Adjusted EBITDA can provide a useful additional basis for comparing the current performance of the underlying operations being evaluated. For these reasons, we believe EBITDA-based measures are often used by the investment community as a means of comparison of companies in our industry. By deducting variable costs (raw materials, packaging, utilities and distribution costs) from revenue, we believe that Contribution Margins can provide a useful basis for comparing the current Table of Contents Flexible Contracts with the Ability to Pass Through Raw Material Cost Increases We have a proactive price and contract management strategy, which supports our efforts to preserve our margins by passing feedstock and energy cost increases through to our customers on a timely basis. In recent years, global oil prices have fluctuated significantly; for example, Brent crude oil prices increased from $76 per barrel in May 2010 to a peak of $125 per barrel in March 2012, declining to $108 per barrel by the end of April 2014. A significant portion of our contracts have formula-driven price adjustment mechanisms for changes in raw material and energy costs (approximately 72% in the Rubber Carbon Black segment and approximately 42% in the Specialty Carbon Black segment, based on sales volumes in kmt in 2013). Most of our indexed contracts allow for monthly price adjustments, while a relatively small portion allow for quarterly price adjustments. Terms of our non-indexed contracts are usually short and we review sales prices under these contracts regularly to reflect raw material and energy price fluctuations as well as overall market conditions. We believe that our indexed and short-term contracts position us well to pass changes in raw material and energy costs through to our customers in a reasonably timely fashion. We also believe that this practice has enabled us to maintain our Segment Adjusted EBITDA Margins since the Acquisition, despite significant fluctuations in oil and other raw material prices, and largely obviates our need to engage in financial transactions to hedge against oil price fluctuations. For additional information about our price and contract management strategy, see Business Marketing, Sales and Customer Contracts Flexible Contracts and Management s Discussion of Financial Condition and Results of Operations Key Factors Affecting our Results of Operations Raw Materials and Energy Costs. Strong Operating Earnings Growth and Cash Generation Since the Acquisition Since the completion of the Acquisition, we improved our profitability by achieving higher operating margins for both the Specialty Carbon Black and Rubber Carbon Black segments, implementing operating efficiencies, enhancing raw material sourcing, improving our production facilities and improving pricing above those price changes resulting from passing through changes in raw materials and energy costs for rubber carbon black. These measures helped increase our Contribution Margin per Metric Ton from 351.7 in the post-Acquisition period ending December 31, 2011 to 409.4 in the full year 2013 (our Gross Profit per Metric Ton was 215.2 in the post-Acquisition period ending December 31, 2011 and 277.6 in the full year 2013). We have also managed to achieve a leaner cost structure on a stand-alone basis, replacing the full overhead structure provided by Evonik while also reducing headcount overall. We also improved our cash generation by reducing our Net Working Capital requirements by improving inventory and supply chain management, feedstock purchasing, production scheduling and receivables and payables management. Since the Acquisition, our management reduced the average number of days for which we need to maintain Net Working Capital from over 100 days to less than 70 days. Since the Acquisition, we have been able to reduce our outstanding debt by repaying portions of our Senior Secured Notes, with the outstanding principal amount of those notes declining by 78 million from the end of 2011 to the end of 2013. We were able to reduce our indebtedness during this period despite the significant investments we have made in improving our manufacturing infrastructure since the Acquisition. As a result, coupled with growing Adjusted EBITDA, we have been able to reduce our Net Leverage Ratio (Net Debt (our Senior Secured Notes and Shareholder Loan, excluding capitalized interest, net of cash) at period end as a multiple of Adjusted EBITDA for the trailing 12 months) from 4.77x at the end of 2011 to 3.94x at the end of 2013. We expect to achieve a substantial further reduction in leverage upon the completion of this offering and the Refinancing described below. Highly Experienced, Entrepreneurial Management Team with Proven Track Record Our senior management has an average of more than 20 years of business and industry experience. Our chief executive officer, Jack Clem, joined an affiliated joint venture of the business in 2001 and has over 35 years Table of Contents performance of the underlying operations being evaluated by indicating the portion of revenue that is not consumed by variable costs (raw materials packaging, utilities and distribution costs) and therefore contributes to the coverage of all costs and profits. Different companies and analysts may calculate measures based on EBITDA, contribution margins and working capital differently, so making comparisons among companies on this basis should be done carefully. Adjusted EBITDA, Contribution Margins and Net Working Capital are not measures of performance under IFRS and should not be considered in isolation or construed as substitutes for revenue, consolidated profit (loss) for the period, operating result (EBIT), gross profit and other IFRS measures as an indicator of our operations in accordance with IFRS. Reconciliation of Non-IFRS Financial Measures The non-IFRS financial measures contained in this prospectus are unaudited (except for Adjusted EBITDA) and have not been prepared in accordance with IFRS or the accounting standards of any other jurisdiction and may not be comparable to other similarly titled measures of other companies. For a reconciliation of these non-IFRS financial measures to the most directly comparable IFRS measures, see Management s Discussion and Analysis of Financial Condition and Results of Operations Reconciliation of Non-IFRS Financial Measures. INDUSTRY, RANKING AND OTHER DATA Information included in this prospectus relating to industries, industry size, share of industry sales, industry position, industry capacities, industry demand, growth rates, penetration rates, average prices and other industry data pertaining to our business consists of estimates based on data reports compiled by professional third-party organizations and analysts, on data from external sources, on our knowledge of our sales and industries in which we operate and on our own calculations based on such information. In particular, certain information is based on industry reports issued by Notch Consulting Group and trade journal articles. Share of industry sales estimates are derived from information provided in reports published by Notch Consulting Group. In many cases, there is no readily available external information (whether from trade associations, government bodies or other organizations) to validate industry-related analyses and estimates, thus requiring us to rely on internally developed estimates. While we have compiled, extracted and reproduced industry data from external sources, including third-party, industry or general publications, we have not independently verified the data and cannot assure you of its accuracy or completeness. Similarly, while we believe our internal estimates to be reasonable, they have not been verified by any independent sources, and we cannot assure you as to their accuracy. Forecasts and other forward-looking information with respect to industry and ranking are subject to the same qualifications and additional uncertainties regarding the other forward-looking statements in this prospectus. See Note Regarding Forward-Looking Statements. TRADEMARKS AND TRADE NAMES We own or have rights to certain trademarks and trade names that we use in conjunction with the operations of our business. Each trademark, trade name or service mark of any other company appearing in this prospectus belongs to its holder. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Table of Contents of experience in the performance materials and chemicals industry, with a significant portion of his career in carbon black. Our chief financial officer, Charles Herlinger, has served as chief financial officer for both public and private companies. Our senior managers are veterans of global materials businesses and have a track record of achieving profitable growth and managing through economic cycles. In addition to our experienced management team, the company leadership was further enhanced after the Acquisition by the addition of senior key members. Of our eight Executive Officers who currently report to our chief executive officer, five joined the company after the Acquisition. Our new management team helped us reach stand-alone status following the Acquisition faster than targeted by our shareholders and achieved substantial improvements in operational processes, such as headcount reduction, talent upgrading, operating margins, customer and product mix management, working capital management, financial transparency and supply chain effectiveness. Our Risks and Challenges Our business is subject to numerous risks and challenges that we describe in Risk Factors and elsewhere in this prospectus. You should carefully consider these risks and challenges before investing in our common shares. Our key risks and challenges include, but are not limited to, the following: negative or uncertain worldwide and regional economic conditions, which may adversely affect demand for our products in our key markets; strong competition and fast development of new products that could be used as a substitute for carbon black and reduce demand for our products, or similar developments that could reduce demand for our customers products or make us unable to implement our business strategies; volatility in the industry and in the costs and availability of raw materials and energy, which could adversely affect our profitability and cash flows, especially if we are unable to adjust our pricing quickly enough to pass rising costs to our customers; high customer concentration and dependence on our major customers; risk of actual or alleged violations of environmental regulations, investigations by environmental protection agencies in Europe, the United States and elsewhere (including the pending enforcement action relating to our U.S. operations by the EPA) and liabilities that we could incur under such laws and regulations as a result of litigation and regulatory proceedings (including fines, capital expenditures and remediation costs that could arise from the pending EPA investigation). For more information, See Business Environmental, Health and Safety Matters Environmental Environmental Proceedings ; and safety and health risks resulting from our operations as a company in the chemical sector. Our Strategy We intend to use our core competencies in carbon black production and end-use application knowledge to continue strengthening our market shares, our long-term profitability and our position as a preferred supplier in major markets around the world, as follows: Continue Strengthening Our Leadership Position in Specialty Carbon Black We believe that our share of global industry sales for the Specialty Carbon Black segment demonstrate that we are a global leader in these carbon black products. We intend to continue strengthening our position as a Table of Contents premium producer of these products by increasing our presence in the markets we serve. We expect this growth to be driven by new premium performance specialties to address increasing customer requirements and by expanding both our technical sales coverage and production platforms to better supply emerging markets where historically we have been under-represented. Since the Acquisition, we have increased personnel in our specialty carbon black sales force by approximately 15%. We will continue upgrading and expanding our technical sales support capabilities by recruiting and retaining regional industry experts in specialty carbon black applications and key account management. We also plan to implement initiatives to match local production with local demand by expanding our specialty carbon black capacity in regions such as Asia and South America. We will continue our shift to higher margin products as opportunities arise and through ongoing investment in facilities, technology and R&D. We have focused our innovation efforts on certain Lighthouse Projects, which we define as those critical initiatives targeted at delivering premium products for high value applications such as conductive materials, advanced insulation materials, battery applications and the next generation of coatings. Our investments in after-treatment facilities in Germany came on line in early 2014 and are expected to help support continued growth in these materials. A new generation reactor is planned to commence operation in 2015 in Germany, adding another advanced technology to our production platform. This unit will be directed to specialized materials for proprietary applications. The trend of shifting rubber carbon black production to specialty carbon black capacity will continue with the next line conversion scheduled for late 2014 in the United States. Planning is underway for similar conversions in Asia and South America, following recent conversions at Malm (Sweden) and Belpre (Ohio). Continue Increasing Our Rubber Carbon Black Margins While Growing Globally with Our Customers We expect to grow our business by expanding our production to meet the demands of our customers in our regional markets. These markets are expanding with the growing mobility trends around the world and we are well situated to supply these regions with a strong production footprint. We have expanded capacity in South Korea and will be using the additional volumes of this unit to address the markets in South Korea and the larger Asia-Pacific region, which should help expand our market share in that region. We are also seeking to acquire QECC, which would give us better access to the Chinese market for rubber carbon black, a market we believe offers significant opportunities for profitable growth and which we currently serve only through export channels. We are also actively seeking other acquisition opportunities and joint venture partners in China to further expand our rubber carbon black production base (as well as provide a future platform for specialty carbon black production). Planning is underway to increase capacities in our facility in Paulinia (Brazil) to meet the demands of major tire and mechanical rubber companies that are expanding in South America. Our plant in Jaslo (Poland) is well situated to serve the growing Eastern European market. As this region grows, we will be prepared to add capacity to this facility. We have recently taken steps to eliminate bottlenecks in our U.S. platform in order to meet demand as tire companies commission new manufacturing facilities in the United States. We also seek to improve the profitability of our rubber carbon black business by developing applications in higher margin markets for mechanical rubber goods and specialty tire requirements. For example, we recently increased capacity in South Korea and Southern Europe for mechanical rubber goods grades that offer improved performance in compounds for automotive sealing systems. We are also supporting our customers efforts to meet labeling requirements for tires in Europe and those to come in the United States, South Korea and other countries, by ensuring consistent quality within tightening specifications from our global network. A major Lighthouse Project is also underway to commercialize new grades of rubber carbon black that offer a substantial increase in tread life while maintaining other properties such as rolling resistance and traction. With the increased visibility provided by our recently upgraded global management information system, we are better positioned to continue improving our customer and product mix by shifting to more profitable Table of Contents customer/location/grade combinations in our markets around the world. Our global management information system also supports enhanced efforts in price discipline and management of cost increase pass-throughs where necessary and should help us gain a more strategic balance in our relationships with our global key accounts and larger regional accounts. Strengthening the Competitiveness of Our Operations We have improved the operating efficiency of our business since the Acquisition. Our goal is best-in-class operating economics in our production platform and a streamlined business structure for Orion as a whole. We believe that our current operational efficiency, flexibility and reliability give us a competitive foundation for future value-creation. We intend to continue our production and energy efficiency initiatives by further exploiting alternative feedstock sources, while optimizing our feedstock and energy purchasing and pricing methods. We will continue upgrading our production lines with the higher efficiency Orion Design reactors, which are expected to help increase yield and improve reliability. We recently commissioned Orion Design reactors in Ivanhoe (Louisiana) and Orange (Texas) and plan to install such reactors in several other facilities in the United States as well as in Asia and South Africa. We have seen strong increases in global energy efficiency since we installed upgraded heat-recovery equipment in a number of our plants and expect to continue this upgrade at other plants as opportunities for efficiency improvements arise. Since the Acquisition we have adopted a series of best-practices in our production network. These new standards and approaches have helped us increase our operating efficiencies without significant capital expenditure and will add more value as we continue to develop them. We will continue to focus managerial resources on bringing all of our facilities in line with these higher standards while systematizing our improved practices to make the gains sustainable. We have used similar best-practice standards for our High Performance Organization ( HPO ) initiative. HPO is targeted at redesigning work processes and increasing employee involvement to improve productivity. We began operating as an independent company with well over 1,500 employees at the time of the Acquisition. Despite having to hire more than 60 administrative personnel to provide a range of services previously provided by Evonik, as a result of certain headcount reduction initiatives we reduced our personnel to 1,405 at the end of 2013. The closure of our Sines (Portugal) plant in December 2013 will lead to a further headcount reduction of approximately 35 full-time employees (FTEs) in 2014. Our headcount reduction efforts included a continuing talent upgrade program that has resulted in the reduction of well over 250 personnel, replaced with approximately 100 higher-qualified personnel. A key success in this area has been the revamping of our senior management team, replacing a majority of the positions with globally experienced senior managers. In addition, we intend to continue implementing a more efficient corporate and management structure at less senior levels, coupled with compensation arrangements that strengthen incentives for our employees with individual performance-linked bonuses based on value creation and cash generation. We intend to further improve our global management information system to provide better transparency and improve organizational efficiencies, having completed in 2013 the rollout of our globally standardized SAP platform. Such transparency permits better pricing and portfolio mix decisions, clear cost accountability within the organization and improved performance through continued pursuit of best practices in distribution methods and supply chain management, including global inventory management, integrated sales and production planning, and process efficiency upgrades. Our operations key performance indicator system provides management with a more timely and consistent view of the critical operating parameters of our platform around the globe. A specialized team of engineers is ready to act quickly on anomalies identified by the newly commissioned system. Table of Contents Corporate History and Information As of the date of this prospectus, we are a Luxembourg limited liability company (soci t responsabilit limit e), with a registered office at 15, Rue Edward Steichen, L-2540 Luxembourg, Grand Duchy of Luxembourg. We were incorporated on April 13, 2011 under the name Kinove Luxembourg Holdings 2 S. r.l. and are registered with the Luxembourg Trade and Companies Register (Registre de Commerce et des Soci t s) under number B 160558. On May 8, 2014, we changed our name from Kinove Luxembourg Holdings 2 S. r.l. to Orion Engineered Carbons S. r.l. Following the date of this prospectus, but prior to the completion of this offering, we will change our legal form to become a Luxembourg joint stock corporation (soci t anonyme or S.A.) and our name will change to Orion Engineered Carbons S.A. Our registered office is located at 15 rue Edward Steichen, L-2540 Luxembourg, Grand Duchy of Luxembourg, and our telephone number is +352 270 48 06 0. Our website address is www.orioncarbons.com. The information contained on, or that can be accessed through, our website is not part of, and is not incorporated into, this prospectus. Our agent for service of process in the United States is Corporation Service Company, located at 1180 Avenue of the Americas, New York, NY 10036, telephone number (800) 927-9800. Historically, our business operated as a business line of Evonik. Effective July 29, 2011, the Rh ne Investors and the Triton Investors indirectly acquired from Evonik the entities operating its carbon black business. Currently, we operate on a fully stand-alone basis. We operate our businesses through a number of direct and indirect subsidiaries. The following organizational chart presents the percentage ownership and jurisdictions of organization of our significant subsidiaries: Table of Contents Principal Shareholders and Selling Shareholder Approximately 88.9% of our shares prior to our change in legal form are held by Kinove Holdings. Prior to this offering (but after giving effect to our change of legal form to a joint stock corporation and the issuance of new shares in connection with the Refinancing described below), approximately 89.69% of our common shares will be held by Kinove Holdings. The remainder will be held by Kinove Luxembourg Coinvestment S.C.A. ( Luxco Coinvest ), an investment vehicle that is owned by members of our management (the Management Investors ) and Kinove Holdings, and that is managed by Kinove Holdings. All of the common shares to be sold in this offering will be sold by Kinove Holdings, which we refer to as the Selling Shareholder. After giving effect to this offering, Kinove Holdings and Luxco Coinvest will hold 57.81% and 10.31%, respectively, of our outstanding common shares. Kinove Holdings is currently owned primarily by the Rh ne Investors and the Triton Investors, to whom we refer as our Principal Shareholders. The remaining ownership interests in Kinove Holdings are held by Luxinva S.A. (the ADIA Investor ), a wholly-owned subsidiary of the Abu Dhabi Investment Authority, a public institution wholly-owned by the Government of the Emirate of Abu Dhabi. After giving effect to this offering the Rh ne Investors, the Triton Investors and the ADIA Investor will own, indirectly, 27.63%, 27.63% and 6.76%, respectively, of our common shares (25.50%, 25.50% and 6.24%, respectively, assuming full exercise of the underwriters option to purchase additional common shares). The Management Investors (including two of our directors) will own, indirectly through Luxco Coinvest, 6.10% of our common shares. For more information about our share ownership, see Principal Shareholders and Selling Shareholder and Related Party Transactions Management Participation Program. We understand that in connection with this offering, the Principal Shareholders and the ADIA Investor intend to enter into a shareholders agreement with respect to their holdings in Kinove Holdings. Among other things, this agreement will provide that the shareholders of Kinove Holdings will vote their shares in Kinove Holdings as necessary to appoint to the Company s Board of Directors two directors nominated by the Rh ne Investors, two directors nominated by the Triton Investors and the remaining directors as nominated jointly by the Principal Shareholders. In addition, it is expected that each of the Rh ne Investors and the Triton Investors will have the right to appoint non-voting observers to attend any meeting of the Company s Board of Directors (or any committee thereof) as long as, in each case, their pro rata indirect interest in the Company s common shares, based on shares held by Kinove Holdings and Luxco Coinvest, is not less than 5%. This right to appoint board observers will lapse three years after the consummation of this offering and the determination to grant this right to Kinove Holdings will be made by the Board of Directors of the Company. Further, the shareholders agreement will provide that, generally, for a period of three years following the expiration of the lock-up agreements in connection with this offering, shares of the Company will be sold by Kinove Holdings in a manner that is pro rata among the Rh ne Investors, the Triton Investors and the ADIA Investor. Refinancing At or prior to the closing of this offering, we intend to take the following steps to refinance our outstanding borrowings and discharge our outstanding preferred equity certificates (the Refinancing ). The matters described below reflect our current estimates and plans. Enter into a new credit facility (the New Credit Facility ) consisting of (i) a senior secured term loan of approximately 665 million, which we expect would have a final maturity in 2021 and would accrue interest at a floating annual rate based on a base rate or LIBOR plus a spread and (ii) a multicurrency, senior secured revolving line of credit of up to 115 million, which we expect would have a final maturity in 2019 and would accrue interest at a floating annual rate based on a base rate or LIBOR plus a spread. The terms of the New Credit Facility have not been finally determined and are subject to change. For a summary of the expected material terms of the New Credit Facility see Description of Material Indebtedness New Senior Secured Credit Facility. Table of Contents Use the net proceeds from the new term loan described above to do the following: redeem our Senior Secured Notes in full, in an aggregate amount of approximately 532 million (including principal, premium and estimated accrued interest to the redemption date); this amount is net of approximately 65 million of Senior Secured Notes (including principal, premium and accrued interest) that we redeemed in May 2014; we also made a regular interest payment on the notes of approximately 24 million in June 2014; discharge our Preferred Equity Certificates held by Kinove Holdings, which we refer to as the PECs or our Shareholder Loan, in full, in an aggregate amount of approximately $396 million ( 287 million) (which includes principal and estimated accrued yield to the discharge date), by (1) paying approximately $110 million ( 80 million) in cash to Kinove Holdings in respect of a portion of the PECs and (2) issuing approximately $286 million ( 207 million) worth of new shares at the initial public offering price for this offering to Kinove Holdings in respect of the balance, which would be treated as an equity contribution; based upon the mid-point of the estimated price range set forth on the cover of this prospectus, the number of new shares to be issued would be approximately 12,708,102 and would increase by approximately 590,000 common shares for every $1.00 of decrease (or decrease by approximately 540,000 common shares for every $1.00 of increase) in the initial public offering price below (or above) the mid-point of the estimated range; repay approximately 45 million (including principal and estimated accrued interest to the repayment date) owing under our $250 million existing revolving credit facility (the Revolving Credit Facility ), in respect of borrowings that we made after March 31, 2014 to the extent they have not been repaid prior to the Refinancing; and pay approximately 15 million of estimated fees relating to the New Credit Facility. Prior to the pricing of this offering, we will call the remaining Senior Secured Notes for redemption on a date that will occur after the closing of this offering. The redemption notice will be given at least 30 days in advance of the redemption date and will be irrevocable, subject to the closing of this offering and the Refinancing having occurred. Prior to the closing of this offering, we will place in escrow, for the benefit of the holders of the remaining notes, funds sufficient to redeem the notes on the redemption date and satisfy and discharge the indenture under which they were issued. We will remain obligated to pay the escrowed funds to the note holders on the redemption date. The accrued interest and yield included in the amounts listed above are estimates and will depend on when the closing of this offering and the subsequent redemption date actually occur. At the closing of this offering, all of our liabilities in respect of the Senior Secured Notes and PECs will be extinguished (subject to our obligation to pay the escrowed funds to the note holders as described above) and, together with our Revolving Credit Facility, of which approximately $188 million is currently undrawn, will be replaced with the term loan and line of credit (which will be undrawn) under the New Credit Facility. As a result of these steps, we expect that our outstanding total liabilities as of March 31, 2014 will be reduced by approximately 161.9 million, or 14.7% (net of reduction for capitalized transaction costs, unamortized discount and accrued interest or yield). In addition, we would expect the Refinancing to substantially reduce our interest costs, which have reflected annual interest rates of 10.000% (Euro tranche) and 9.625% (U.S. Dollar tranche), in the case of the Senior Secured Notes, and an annual yield rate of 10.573%, in the case of the PECs. In comparison, we estimate that the new term loan will have an overall effective interest rate substantially lower than the current rates listed above. See Pro Forma Financial Information. The amounts referred to above assume that the pricing of this Table of Contents offering will occur on July 24, 2014 and, where expressed in Euro, include U.S. Dollar amounts converted at a rate of 1.00 = US$1.3800. If the pricing of this offering occurs on a later date, the amounts of accrued interest and accrued yield (and thus the number of shares to be issued to Kinove Holdings in the Refinancing) described above would increase. We understand that Kinove Holdings intends to use the net proceeds from its sale of common shares in this offering, together with the funds it receives from us on discharge of the PECs and its own available cash, to repay in full the principal amount of its outstanding PIK Toggle Notes due 2019, at the closing of this offering. For more information about the potential impact of this offering and the Refinancing on our financial condition and results of operations, see Capitalization and Pro Forma Financial Information. For more information about the Senior Secured Notes, the PECs and the proposed terms of the New Credit Facility, including restrictive covenants, see Description of Material Indebtedness. Table of Contents
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+PROSPECTUS SUMMARY AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, "WE," "US," "OUR," AND "ALAZZIO ENTERTAINMENT CORP." REFERS TO ALAZZIO ENTERTAINMENT CORP. THE FOLLOWING SUMMARY PROVIDES A BRIEF OVERVIEW OF THE KEY ASPECTS OF THE OFFERING. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK. ALAZZIO ENTERTAINMENT CORP. Alazzio Entertainment Corp. is a development stage photo booth rental company that plans to offer high quality photography experience delivered to client's front door. Taking advantage of mobility of our photo booth we are going to deliver our photo booth directly to our clients for different events such as weddings, Stagettes, birthday parties, corporate events, festivals, community events, trade shows, grads, bar mitzvah and other special events. In addition will offer a guestbook service to collect a copy of all of the photo strips, where clients and their guests can sign and express their wishes. We have purchased one photo booth, but have not started the operations. As a result, we do not have any revenues Being a development stage company, we have no revenues and have limited operating history. Alazzio Entertainment Corp. was incorporated in Nevada on Jan. 24, 2014. To date we have prepared a business plan and purchased one Photo Booth. Our principal executive office is located at Sofroniy Vrachanskiy N 35, Sophia, Bulgaria, Zip 1303. Our phone number is +36 212 556156. We require a minimum funding of $25,000 to conduct our 12 months plan of operation, and if we are unable to obtain this level of financing, our business may fail. We are a company without revenues and have just recently started our operations; we have minimal assets and have incurred losses since inception. Our financial statements for the period from January 24, 2014 (date of inception) to June 30, 2014, report no revenues and a net loss of $5,332. As of June 30, 2014 we had $ 653 in cash on hand. As of the date of this prospectus we had $636 in cash on hand. Our independent registered public accountant has issued an audit opinion for Alazzio Entertainment Corp. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. If we are unable to obtain additional working capital our business may fail. To date, the only operations we have engaged in are the development of a business plan and the purchase of a Photo Booth. We intend to use the net proceeds from this offering to develop our business operations (See "Description of Business" and "Use of Proceeds"). Being a development stage company, we have very limited operating history. Proceeds from this offering are required for us to proceed with our business plan over the next twelve months. We require minimum funding of $25,000 to conduct our proposed operations and pay all expenses for a minimum period of one year including expenses associated with maintaining a reporting status with the SEC. If we are unable to obtain minimum funding of $25,000, our business may fail. Even if we raise $100,000 from this offering or more, we may need more funds to develop growth strategy and to continue maintaining a reporting status. As disclosed in this summary and elsewhere in this Prospectus, including the Management's Discussion and Analysis section, we require $25,000 to implement our business plan. We have limited resources, even if this Offering is fully subscribed. Our President, and sole officer Dmitri Kapsamun, has agreed to supplement our funding in order to initially implement our business plan. We are self-underwritten and have no plans from any associates, except as disclosed herein." As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. Our president devotes approximately 20 hours/week to the business and he has no prior experience managing a public company. If necessary, Dmitri Kapsamun, our president, has verbally agreed to lend funds to pay for the registration process and lend funds to implement your business plan and to help maintain a reporting status with the SEC in the form of a non-secured loan for the next twelve months. There has been no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority ("FINRA") for our common stock to be eligible for trading on the Over-the-Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There can be no assurance that our common stock will ever be quoted on a stock exchange or a quotation service or that any market for our stock will develop. We affirmatively state that the company, the company's officers and directors, any company promoters, or any of our affiliates do not intend for the company, once it is reporting, to be used as a vehicle for a private company to become a reporting company. THE OFFERING The Issuer: ALAZZIO ENTERTAINMENT CORP. Securities Being Offered: 10,000,000 shares of common stock Price Per Share: $0.01 Duration of the Offering: The offering shall terminate on the earlier of: (i) the date when the sale of all 10,000,000 common shares is completed; (ii) one year from the date of this prospectus; or (iii) prior to one year at the sole determination of the board of directors. Gross Proceeds if 100% of the shares are sold: $100,000 Gross Proceeds if 75% of the shares are sold: $75,000 Gross Proceeds if 50% of the shares are sold: $50,000 Gross Proceeds if 25% of the shares are sold: $25,000 Securities Issued and Outstanding: There are 6,000,000 shares of common stock issued and outstanding as of the date of this prospectus, held solely by our sole officer and director, Dmitri Kapsamun. Registration Costs: We estimate our total offering registration costs to be approximately $10,000. Risk Factors: See "Risk Factors" and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock. SUMMARY FINANCIAL INFORMATION The summarized financial data presented below is derived from, and should be read in conjunction with, our audited financial statements and related notes from January 24, 2014 (date of inception) to June 30, 2014, included on Page F-1 in this prospectus. FINANCIAL SUMMARY June 30, 2014 ($) ----------------- Cash and Deposits 653 Equipment 8,565 Total Assets 9,218 Total Liabilities 8,550 Total Stockholder's Equity 668 STATEMENT OF OPERATIONS Accumulated From January 24, 2014 to June 30, 2014 ($) ----------------- Total Expenses 5,332 Net Loss for the Period 5,332 Net Loss per Share 0 We affirmatively state that the company, the company's officers and directors, any company promoters, or any of our affiliates do not intend for the company, once it is reporting, to be used as a vehicle for a private company to become a reporting company.
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary does not contain all of the information that should be considered before investing in our common stock. Investors should read the entire prospectus carefully, including the risks related to our business and purchasing our common stock discussed under "Risk Factors" beginning on page 4 of this prospectus. Our Company Our Business We provide asset disposition, valuation and appraisal, and real estate consulting services to a wide range of retail, wholesale and industrial clients, as well as lenders, capital providers, private equity investors and professional service firms throughout the United States, Canada and Europe. We recently completed the acquisition of B. Riley & Co., Inc., an independent investment firm that provides corporate finance, research, sales and trading, and asset management services to corporate institutional and high net worth individuals throughout the United States. We now operate our business in three segments: auction and liquidation solutions, valuation and appraisal services and capital markets services Effective November 6, 2014 at 4:01 PM Eastern Standard Time, the Company changed its name from Great American Group, Inc. to B. Riley Financial, Inc. (the Name Change). In connection with the Name Change, we also changed our trading symbol on the Over-the-Counter Bulletin Board from "GAMR" to "RILY." For more information regarding our business, see the disclosure under the heading "Business" included elsewhere in this prospectus. For a description of certain risks related to our business, see the disclosure under the heading "Risk Factors" beginning on page 4 of this prospectus. The Private Placement On June 5, 2014, the Company closed the Private Placement pursuant to which it issued and sold to 53 accredited investors (collectively, the Investors) an aggregate of 10,289,300 shares of the Company s common stock (collectively, the Private Placement Shares) at a purchase price of $5.00 per share. The Private Placement was completed pursuant to the terms and provisions of a securities purchase agreement entered into among the Company and the Investors on May 19, 2014 (the Purchase Agreement). At the closing of the Private Placement on June 5, 2014, the Company received aggregate gross proceeds of approximately $51.4 million. The Company used a portion of the net proceeds from the Private Placement to repay certain indebtedness in accordance with the terms of letter agreements entered into by the Company and each of Andrew Gumaer and Harvey Yellen on May 19, 2014. The Company expects to use all remaining net proceeds for working capital and general corporate purposes. Strategic Combination On June 18, 2014, the Company completed its previously announced acquisition of B. Riley & Co., Inc. (BRC). The Company acquired BRC pursuant to the terms of the Acquisition Agreement, dated as of May 19, 2014, by and among the Company, Darwin Merger Sub I, Inc., a wholly owned subsidiary of the Company (Sub I), B. Riley Capital Markets, LLC, a wholly owned subsidiary of the Company (BCM), BRC, B. Riley & Co. Holdings, LLC (BRH), Riley Investment Management LLC (RIM, and collectively with BRC and BRH, the B. Riley Entities) and Bryant Riley, a director of the Company and the sole or principal owner of each of the B. Riley Entities (Seller). Pursuant to the terms and conditions of the Acquisition Agreement, the Company agreed to acquire the B. Riley Entities in exchange for the issuance of shares of its common stock (which represents the base purchase price of 4,200,000 shares of common stock, as adjusted for the estimated working capital adjustment set forth in the Acquisition Agreement). 628,727 of such shares issuable to Seller have been placed into an escrow account governed by the terms and conditions of an escrow agreement, dated as of June 18, 2014, by and among the Company, Seller and Continental Stock Transfer & Trust Company, Inc., as escrow agent (the Escrow Agreement). Such escrowed shares will serve as security for the indemnification obligations of Seller and the B. Riley Entities pursuant to the Acquisition Agreement and any downward adjustment to the merger consideration as a result of the final working capital adjustment provided for in the Acquisition Agreement. In connection with the Company s acquisition of BRC, Sub I merged with and into BRC, and BRC subsequently merged with and into BCM, with BCM surviving as a wholly owned subsidiary of the Company. The acquisitions of BRH and RIM were completed on August 1, 2014. Corporate Information Our principal executive offices are located at 21860 Burbank Boulevard, Suite 300 South, Woodland Hills, California 91367, and the telephone number at our principal executive office is (818) 884-3737. Our website addresses are http://www.greatamerican.com and http://www.brileyfin.com. We have not incorporated by reference into this prospectus the information on our website, and you should not consider it to be a part of this document. TABLE OF CONTENTS Page No. Prospectus Summary 1
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+This summary highlights selected information contained elsewhere or incorporated by reference in this prospectus. Because it is a summary, it may not contain all the information that is important to you in making your investment decision to purchase the depositary shares. You should carefully read this entire prospectus, as well as the information incorporated by reference herein, before deciding whether to invest in the depositary shares. You should carefully consider the section entitled Risk Factors in this prospectus and the documents incorporated by reference herein to determine whether an investment in the depositary shares is appropriate for you. The Company SB Financial Group, Inc. ( SB Financial ) is an Ohio corporation and a bank holding company registered under the Bank Holding Company Act of 1956, as amended. We were incorporated under Ohio law in 1983, and we changed our name from Rurban Financial Corp. to SB Financial Group, Inc. effective April 18, 2013. Through our wholly-owned subsidiaries, we are engaged in a variety of activities, including commercial and retail banking, item processing, insurance, and wealth management and trust services. Our banking subsidiary, State Bank, is an Ohio state-chartered bank that offers a full range of commercial banking services, including checking accounts, savings accounts, money market accounts and time certificates of deposit; automatic teller machines; commercial, consumer, agricultural and residential mortgage loans; personal and corporate trust services; commercial leasing; bank credit card services; safe deposit box rentals; Internet and telephone banking; and other personalized banking services. The trust and financial services division of State Bank offers various trust and financial services, including asset management services for individuals and corporate employee benefit plans, as well as brokerage services through Cetera Investment Services, an unaffiliated company. State Bank presently operates seventeen banking centers, all located within the Ohio counties of Allen, Defiance, Fulton, Lucas, Paulding, Wood and Williams, and one banking center located in Allen County, Indiana. State Bank also presently operates three loan production offices, two in Franklin County, Ohio and one in Steuben County, Indiana. At June 30, 2014, State Bank had 193 full-time equivalent employees. Our item processing subsidiary, Rurbanc Data Services, Inc. dba RDSI Banking Systems ( RDSI ), has been in operation since 1964 and became an Ohio corporation in June 1976. RDSI has one operating location in Defiance, Ohio. In September 2006, RDSI acquired Diverse Computer Marketers, Inc. ( DCM ) which was merged into RDSI effective December 31, 2007 and now operates as a division of RDSI doing business as DCM . DCM has one operating location in Lansing, Michigan providing item processing and related services to community banks located primarily in the Midwest. At June 30, 2014, RDSI had 8 full-time equivalent employees. Our principal executive offices are located at 401 Clinton Street, Defiance, Ohio 43512, and our telephone number is (419) 783-8950. Our website address is www.yoursbfinancial.com. The information on our website is not a part of or incorporated by reference in this prospectus. Business and Strategy We are a diversified financial services holding company with total consolidated assets of approximately $662.5 million, total net loans of approximately $499.6 million, total deposits of approximately $524.1 million and total shareholders equity of approximately $59.0 million at June 30, 2014. Through our banking subsidiary, State Bank, we provide a full range of financial services for consumers and small businesses, including wealth management, mortgage banking and commercial and agricultural lending, through 16 banking centers in seven Northwest Ohio counties and one center in Fort Wayne, Indiana, as well as three loan production offices, two located in Columbus, Ohio, and one in Angola, Indiana. Through RDSI, we provide item processing services to 23 community banks located primarily in the Midwest. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where an offer or sale thereof is not permitted. Subject to Completion, dated November 6, 2014 PROSPECTUS Up to 1,500,000 Depositary Shares Each Representing a 1/100th Interest in a 6.50% Noncumulative Convertible Perpetual Preferred Share, Series A We are offering up to 1,500,000 depositary shares, each representing a 1/100th ownership interest in a 6.50% Noncumulative Convertible Perpetual Preferred Share, Series A, of SB Financial Group, Inc. with a liquidation preference of $1,000.00 per share (equivalent to $10.00 per depositary share) (the Series A Preferred Shares ). We are offering the depositary shares for sale to the public in the following descending order of priority: (1) to our existing shareholders; (2) to our customers and members of the local communities we serve; and (3) to the extent that depositary shares remain available for purchase, in a syndicated offering managed by Keefe, Bruyette & Woods, Inc. See Plan of Distribution Offering Priorities. We must sell a minimum of 1,000,000 depositary shares to complete the offering. The minimum number of depositary shares you may purchase in the offering is 100 depositary shares. The maximum number of depositary shares that you may purchase in the offering is the lesser of (i) 250,000 depositary shares or (ii) the number of depositary shares, assuming conversion of such depositary shares into our common shares, whereby your total beneficial ownership of our common shares (including any common shares currently owned) would not exceed 5% of our outstanding common shares after the offering. The offering is expected to expire at 3:00 p.m., Eastern Time, on December 12, 2014. We may extend this expiration date without notice to you until January 26, 2015. Once submitted, orders are irrevocable. However, if the offering is extended beyond January 26, 2015, or the number of depositary shares to be sold is increased to more than 1,500,000 depositary shares or decreased to fewer than 1,000,000 depositary shares, we will resolicit subscribers, giving them an opportunity to change or cancel their orders. Funds received during the offering will be placed in a segregated account at U.S. Bank, which will serve as our escrow agent for the offering. If the closing of the offering does not occur for any reason, the funds will be promptly returned without interest. U.S. Bank is acting only as an escrow agent in connection with the offering of securities described herein, and has not endorsed, recommended or guaranteed the purchase, value or repayment of such securities. As a holder of our depositary shares, you will be entitled to all proportional rights, preferences and privileges of the Series A Preferred Shares, including dividend, voting, conversion and liquidation rights. You must exercise these rights through the depositary. We expect to pay noncumulative dividends on the Series A Preferred Shares (and, therefore, the depositary shares) at the rate of 6.50% of the liquidation preference per year. Such dividends will be payable quarterly in cash, when, as and if declared by our board of directors, on March 15, June 15, September 15 and December 15 of each year, commencing March 15, 2015. Dividends for the first dividend period ending March 15, 2015, if any, will be for less than a full quarter if the offering closes after December 15, 2014, and will be for greater than a full quarter if the offering closes before December 15, 2014. If our board of directors does not declare a dividend for any quarterly dividend period, you will not be entitled to receive any dividend for that quarterly dividend period and the undeclared dividend will not accumulate. Each depositary share will be convertible at your option at any time into our common shares equal to the quotient achieved when $10.00 is divided by the conversion price then in effect. The initial conversion price is $10.34, which may be adjusted as described in this prospectus. We may, at our option, convert each depositary share into that number of our common shares equal to the quotient achieved when $10.00 is divided by the conversion price then in effect, on or after the fifth anniversary of the issue date of the Series A Preferred Shares. We may exercise this option only if (i) the closing sale price for our common shares equals or exceeds 120% of the conversion price then in effect for at least 20 trading days in a period of 30 consecutive trading days (including the last trading day of such period) ending on the fifth trading day immediately prior to our issuance of a press release announcing our exercise of this option; and (ii) we have paid full dividends on the depositary shares for four consecutive quarters prior to the issuance of the press release. All of the depositary shares we are selling in this offering, and the common shares issued upon conversion of the depositary shares, if any, will be freely tradable without restriction under the Securities Act of 1933, as amended, except for shares purchased by our affiliates. We have applied for the depositary shares to be listed on the NASDAQ Capital Market under the symbol SBFGP. If the application for listing is approved, trading of the depositary shares is expected to commence within 30 days following the initial issuance of the depositary shares. Our common shares are currently listed on the NASDAQ Capital Market under the symbol SBFG. The last reported sale price of our common shares on the NASDAQ Capital Market on November 5, 2014 was $8.80. Investing in our depositary shares involves risks. You should read the Risk Factors section beginning on page 22 of this prospectus and in our Annual Report on Form 10-K for the year ended December 31, 2013, before making a decision to invest in the depositary shares. Per Total Depositary Share Minimum Offering Maximum Offering Public offering price $ 10.000 $ 10,000,000 $ 15,000,000 Placement agent fee in shareholder and customer/local community offerings (1) $ 0.175 $ 175,000 $ 262,500 Placement agent fee in syndicated offering (1) $ 0.275 $ 275,000 $ 412,500 Proceeds to us, before expenses $ 9.550 $ 9,550,000 $ 14,325,000 (1) Represents fees payable to Keefe, Bruyette & Woods, Inc. equal to 3.5% of the aggregate dollar amount of depositary shares sold in the shareholder and customer/local community offerings and 5.5% of the aggregate dollar amount of depositary shares sold in the syndicated offering. We have assumed that 50% of the depositary shares will be sold in the shareholder and customer/local community offerings and 50% of the depositary shares will be sold in the syndicated offering. See Plan of Distribution Marketing and Distribution; Compensation for a discussion of Keefe, Bruyette & Woods, Inc. s compensation in this offering. None of the Securities and Exchange Commission (the SEC ), the Federal Deposit Insurance Corporation (the FDIC ), the Board of Governors of the Federal Reserve System (the Federal Reserve ), any state or other securities commission or any other federal or state bank regulatory agency has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The depositary shares are not savings accounts, deposits or other obligations of any bank, thrift or other depositary institution and are not insured or guaranteed by the FDIC or any other governmental agency or instrumentality. The depositary shares are being offered and sold in a best efforts underwritten offering. We are offering the depositary shares through a placement agent, Keefe, Bruyette & Woods, Inc. ( KBW ). KBW is not required to sell any specific number or dollar amount of depositary shares but will use its best efforts to sell the depositary shares offered. We will issue the depositary shares in book-entry or uncertificated form, except under limited circumstances. Our depositary and transfer agent, Computershare, Inc. and its wholly-owned subsidiary, Computershare Trust Company, N.A., will deliver written confirmation to purchasers of depositary shares in the offering. Keefe, Bruyette & Woods A Stifel Company The date of this prospectus is November [ ], 2014. Table of Contents All subsequent written and oral forward-looking statements concerning the matters addressed in this prospectus and attributable to us or any person acting on our behalf are qualified by these cautionary statements. WHERE YOU CAN FIND MORE INFORMATION We are subject to the informational requirements of the Exchange Act and file with the SEC proxy statements, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as required of a U.S. listed company. You may read and copy any document we file at the SEC s public reference room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our SEC filings are also available to the public from the SEC s web site at www.sec.gov or on our website at www.yoursbfinancial.com. However, the information on, or that can be accessible through, our website does not constitute a part of, and is not incorporated by reference in, this prospectus. Written requests for copies of the documents we file with the SEC should be directed to: SB Financial Group, Inc., P.O. Box 467, Defiance, Ohio 43512, Attention: Anthony V. Cosentino, telephone number (419) 785-3663, email SBFG.IR@YourStateBank.com. This prospectus is part of a registration statement on Form S-1 filed by us with the SEC under the Securities Act. As permitted by the SEC, this prospectus does not contain all the information in the registration statement filed with the SEC. For a more complete understanding of this offering, you should refer to the complete registration statement, including exhibits, on Form S-1 that may be obtained as described above. Statements contained in this prospectus about the contents of any contract or other document are not necessarily complete. If we have filed any contract or other document as an exhibit to the registration statement or any other document incorporated by reference in the registration statement, you should read the exhibit for a more complete understanding of the contract or other document or matter involved. Each statement regarding a contract or other document is qualified in its entirety by reference to the actual contract or other document. INCORPORATION OF CERTAIN INFORMATION BY REFERENCE The SEC allows us to incorporate by reference the information that we file with it, and the information incorporated by reference is an important part of this prospectus. We incorporate by reference the following documents: the Company s Annual Report on Form 10-K for the fiscal year ended December 31, 2013; the Company s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014; the Company s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014; the Company s Current Reports on Form 8-K filed on February 24, 2014, April 24, 2014 (with respect to information reported under Item 5.07), September 11, 2014 and October 27, 2014 (with respect to information reported under Item 3.01); and the Company s Definitive Proxy Statement related to its 2014 annual meeting of shareholders, as filed with the SEC on March 19, 2014. Any statement contained in a document incorporated by reference into this prospectus shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained herein or in any subsequently filed document that is also incorporated by reference in this prospectus modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus. We will provide without charge, upon written or oral request, a copy of any or all of the documents that are incorporated by reference into this prospectus and a copy of any or all other contracts or documents which are referred to in this prospectus. Requests should be directed to: SB Financial Group, Inc., P.O. Box 467, Defiance, Ohio 43512, Attention: Anthony V. Cosentino, telephone number (419) 785-3663, email SBFG.IR@YourStateBank.com. Table of Contents Our focus and strategic goal is to grow our organization into a top-quartile performing financial services company. The following is a summary of the key initiatives that we have adopted for the next three years to achieve our strategic goal: Increase profitability through ongoing diversification of revenue streams. For the six months ended June 30, 2014, the Company generated approximately 37% of our revenue from fee-based business lines and other noninterest income. These revenue sources include fees generated from retail deposit products, assets under management (AUM) in State Bank s wealth management division, saleable residential mortgage loans, saleable business-based loans (SBA and FSA), and fees generated by RDSI, our wholly-owned item processing subsidiary. The following is a break-down of our non-interest income sources for the six months ended June 30, 2014: Deposit Products 22% Assets Under Management (AUM) Fees 22% Mortgage Lending 37% Data Service 11% Other 8% During 2014, we restructured the retail deposit products offered by State Bank to generate additional revenue and further increase our non-interest income while streamlining our product offerings. As part of this initiative, we launched four new Rewards Checking products in January 2014, and we migrated all of our retail checking accounts from 22 existing products to the four new Rewards Checking products in June 2014. Our new Rewards Checking product lineup provides State Bank the opportunity to reward its customers with ATM refunds, cash back and higher interest-rates if they use certain qualifying products and services (such as electronic banking) or if they maintain certain relationship balances. Customers who do not meet the utilization or balance requirements under the new Rewards Checking products are required to pay a monthly service fee. We plan to implement a similar strategy in the business account sector during the fourth quarter of 2014 to more efficiently and effectively service our approximately 3,000 commercial demand deposit accounts. In our wealth management division, our assets under management (AUM) at December 31, 2013 were $345.5 million, generating $2.7 million in revenue, or 0.79% of average AUM, during the year ended December 31, 2013. We have experienced modest growth in our AUM over the past five years, increasing from $278.1 million at December 31, 2008 to $345.5 million at December 31, 2013, although our AUM decreased to $332.3 million at June 30, 2014. We are focused on increasing our efforts to grow this business line in each of our newer, higher-growth markets like Toledo and Columbus, Ohio and Ft. Wayne, Indiana, where our current market penetration is minimal. In the second quarter of this year, we added a seasoned executive to reorganize our wealth management division, drive sales leadership and grow AUM. In 2006, State Bank s servicing portfolio of sold residential mortgage loans totaled $26 million. As of June 30, 2014, this portfolio stands at $627 million and generates approximately $1.6 million in revenue annually. The increase in our residential mortgage loan volume has not only delivered progressively more non-interest income, but it has been and continues to be critical to expanding our franchise by providing a gateway into new households for which we can potentially deliver additional financial services such as retail deposit products, home equity lines of credit and credit cards. During the first six months of 2014, only 5% of our $100 million residential mortgage loan volume came from refinancing current clients. In contrast, during 2013, over 19% of our volume came from refinanced loans. A strategy we have embraced, and one that has begun to yield results, is the production and sale of government guaranteed loans, including SBA and FSA guaranteed loans. In 2013, our gains on sale of these loans were $585,000. For the first six months of 2014, our gains on sale of these loans are significantly lower at Table of Contents Table of Contents $107,000, but we have a pipeline of approximately $5 million that has the potential to generate additional gains of approximately $400,000, or in aggregate, $507,000 during 2014. We remain committed to growing this area of non-interest income and have dedicated additional personnel and resources to building this key piece of our business. These programs provide us the opportunity to continue to grow and diversify top-line revenue while also providing yet another service to clients to aid them in their own growth. RDSI currently generates approximately $1.6 million in annualized fee-based revenue, based on year to date revenue as of June 30, 2014. These fees originate from servicing 23 client banks item processing needs and from converting electronic sources of data to paper statements for customers of our client banks. Prior to 2010, RDSI was a third-party data services provider for 70+ clients, which included network services. However, due to a failed divestiture in 2010, RDSI was unable to continue providing data processing and network services. This loss of data processing and network service clients and business resulted in a substantial reduction in RDSI s revenue from its peak of $20.2 million in 2008 to the $1.6 million annual revenue business it represents as of June 30, 2014. Collectively, the foregoing lines of business (i.e., fee-based products and other noninterest income) have generated, on average, 47% of the Company s total consolidated revenue over the last five years (2009 2013). In view of the challenges associated with the decline of traditional net interest margins, we seek to continue to strengthen our position as a leader, among peers, in generating non-interest income. Continued growth and diversification of our loan portfolio. Our loan portfolio over the last several years has grown as follows: Loan Growth by Loan Type (Dollars in thousands) Six months ended June 30, Year ended December 31, 2014 2013 2013 2012 2011 (unaudited) Loan Type Commercial real estate $ 10,523 $ (1,596 ) $ 3,909 $ 13,563 $ 9,939 Residential real estate 5,434 5,433 11,761 203 2,881 Commercial (1) 7,056 3,312 3,877 3,680 5,598 Consumer & Other 1,546 (2,779 ) (2,567 ) (526 ) (1,007 ) Agriculture 4,265 (3,724 ) (3,066 ) 3,915 (2,401 ) Portfolio Growth (%) 6.0 % 0.1 % 3.0 % 4.7 % 3.5 % (1) Includes deferred loan fees, premiums and discounts. Table of Contents The above loan growth (less loans held-for-sale and in process) originated from the following markets (in thousands): Loan Growth by Market (Dollars in thousands) Six months ended June 30, Year ended December 31, 2014 2013 2013 2012 2011 Market (unaudited) Toledo Region $ 5,108 $ (1,423 ) $ 11,188 $ 6,398 $ (3,783 ) Fulton/Williams Region 4,450 (3,886 ) (2,971 ) (4,997 ) 1,973 Defiance/Paulding Region 7,352 4,933 (2,553 ) 8,831 2,363 Ft. Wayne Region (1,752 ) (1,788 ) (4,138 ) (111 ) (2,914 ) Lima Region (1,354 ) (6,002 ) (8,258 ) 2,356 2,936 Columbus Region 15,020 8,812 20,646 8,358 14,435 Portfolio Growth (%) 6.0 % 0.1 % 3.0 % 4.7 % 3.5 % We are focused on growing our loan portfolio not only in each of our more traditional markets (Northwest Ohio) but also in our newer, lower-share markets (Toledo, Ft. Wayne, and Columbus) which have higher growth potential. Our strategy has been to place higher-level market leaders in these distinctly unique markets with the expectation that a decentralized delivery of holistic client care will produce progressively better results than that of larger regional competitors who deploy a more centralized managerial approach. Our Columbus and Toledo Regions have comprised the majority of our loan growth in the past few years and have been a key initiative in the growth of our loan portfolio. Our expansions into each market have been key to our ability to grow our loan portfolio. We have also realized growth in some of our core markets, most notably in our Defiance/Paulding Region, since 2011, as reflected the table above. In addition to the diversity of growth across geographic regions, we have realized growth in a variety of loan segments, particularly as the economy continues to emerge from the financial crisis of a few years ago complementing our already diverse loan portfolio. In addition to the segment and market growth identified above, a key initiative over the last several years has been to identify, originate and sell government enhanced credits. These include residential real estate loans for the secondary market, business loans enhanced with SBA guarantees and long-term agriculture credits bearing an FSA endorsement. This strategy has played a significant role in enabling us to deliver non-interest income for the six months ended June 30, 2014, as a percentage of total revenue, of approximately 37%. The following table identifies gross loans originated in our markets. Loan Sale Gains by Type of Loan Sold (Dollars in thousands) Six months ended June 30, Year ended December 31, 2014 2013 2013 2012 2011 Loan Type (unaudited) Residential $ 1,783 $ 2,934 $ 5,066 $ 6,284 $ 3,620 SBA 19 25 358 90 71 FSA 88 213 227 174 137 Total Gains $ 1,890 $ 3,172 $ 5,651 $ 6,548 $ 3,828 Table of Contents Strengthen our penetration in all markets served. Our deposit market share is approximately as follows for the counties currently served by State Bank: County Deposit Market Share Defiance County (Ohio) 23.2 % Paulding County (Ohio) 21.0 % Williams County (Ohio) 15.3 % Fulton County (Ohio) 6.9 % Wood County (Ohio) 4.6 % Allen County (Ohio) 2.2 % Lucas County (Ohio) 0.2 % Allen County (Indiana) 0.1 % Franklin County (Ohio) 0.0 % Source: FDIC Deposit Market Share Report (June 30, 2013). Over our 112-year history of continuous operation in Northwest Ohio, we have established a significant presence in our traditional markets in Defiance, Paulding, Fulton and Williams Counties in Ohio. Conversely, in our newer markets like Allen County (Ft. Wayne, Indiana), Franklin County (Columbus, Ohio), and Wood and Lucas Counties (Toledo, Ohio), our current market penetration is minimal but we believe our potential for growth is significant. In addition to our focus on increasing our lending, as discussed above, our goal is to continue to increase our deposit market share, particularly in our newer markets, with an emphasis on attracting the more traditional, lower-cost transactional deposit accounts. Expand product service utilization by new and existing clients. A key strategy for our Company is to continue to deepen our relationship with each of our clients. As of June 30, 2014, we served 27,910 households and provided 68,659 services for a services-per-household (SPH) of 2.46. Our strategy is to continue to expand the scope of our relationship with each client household and increase our SPH. An initiative we have implemented this year to execute on this strategy is the appointment of a Client Experience Officer. The primary role for this new management position is for the Client Experience Officer to work interdependently with each of our business line leaders and regional executives in order to optimize the potential number of SPH. Should our efforts fall short on cross-sells at account inception, our dynamic on-boarding process, led by our Client Experience Officer, is tasked with bridging the gap. We have implemented well-defined parameters for methodical client contact to enable us to grow our franchise in our more mature, traditional markets. As of June 30, 2014, we had increased our number of households served to 27,910; up from 27,196 at year-end 2013. Proactively identifying client needs is a key ingredient of our value proposition. Over the past several years, our State Bank team has adopted a holistic approach to client care. To this end, we are focused on providing 100% of our clients financial service needs. On average, over a six-year timeframe (2008 2013), we have identified 2,091 referrals to related lines of business, closed 885 of these referrals and generated approximately $64.8 million in bank business (loans, deposits, AUM) from these referrals. During the first six months of 2014, we identified 1,003 referrals, closed 453 of these referrals and generated approximately $17.8 million in new bank business (loans, deposits, AUM) from these referrals. Our culture and commitment to client care drives our passion for improving both the scale and scope of our operation. Deliver gains in operational excellence. One of the key strategic themes identified by our management is to seamlessly and consistently deliver operational excellence. By executing on this theme, we believe that we are better positioned to deliver our vision of becoming and remaining a high-performance (>75th Percentile) financial services company. Table of Contents At December 31, 2006, we serviced approximately $26 million in sold residential mortgage loans. As of June 30, 2014, we serviced 4,710 sold residential mortgage loans totaling over $627 million. We have established State Bank as a leader in our area in the origination of saleable residential mortgage loans and have put in place the support staff that we believe will sustain this initiative. We continue to reassess our retail delivery channels. Since 2006, we have closed six retail offices as in-store transactions declined, on average, from over 100,000 to less than 74,000 monthly. Conversely, we have increased our investment in our electronic banking platform, which has yielded nearly 300,000 transactions monthly during the first six months of 2014, up from 225,000 transactions monthly for the first six months of 2011. This more cost-effective delivery channel provides the foundation for operational excellence with a more dynamic, robust, anywhere-anytime banking platform. Sustain our asset quality. Asset quality is and continues to be the centerpost for all other initiatives at SB Financial. For the Company to become a top-quartile performing financial services company, it is imperative that we achieve and maintain top-quartile asset quality metrics. Reflecting our top-quartile performance, as of June 30, 2014, our nonperforming assets stood at $6.2 million, or 0.93% of total assets, our past due loans (past due 30 days or more) were 0.59% of total loans, and our loan loss reserve was 116% of non-performing loans. In addition, our net charge-offs for the first six months of 2014 totaled $546,000, or 0.22% annualized of total loans. We believe that continued loan growth is critical for performance improvement at State Bank. Through the first six months of 2014, our organic loan growth (less held-for-sale mortgages) was $29 million, or 12% annualized over year-end. To ensure our portfolio performance remains a strength of our company, our loan quality officer annually reviews each relationship with aggregate debt greater than $250,000. Improve efficiency and leverage our current expense structure. With our current 16-office infrastructure, our efficiency ratio (calculated as total noninterest expense less intangible expense as a percentage of net interest income plus noninterest income) was 78.1% as of June 30, 2014, which was marginally higher than our peer median, and higher than our efficiency ratio of 74.4% as of December 31, 2013 and 75.5% as of December 31, 2012. We have improved our level of expenses over the past several years, in part, by closing several of our less cost-effective retail offices, including a retail office in Defiance, Ohio which was closed in June 2014. Through continued loan growth and resulting margin revenue, coupled with a potential expansion of our fee-based revenue from our wealth management division and residential mortgage loan servicing portfolio, we believe that we can further leverage our current expense structure and improve our efficiency. Market Area and Competition We serve the markets of Northwest Ohio, Northeast Indiana and extreme southern Michigan. Our emphasis over the past several years has been to leverage our competitive strengths into newer markets with higher growth potential like Toledo, Ft. Wayne and Columbus, as many of our older, traditional markets in Northwest Ohio are more mature and reflect lower population growth potential and hence, opportunity . While some counties where we operate reflect little or no population growth, various towns and cities within those counties reveal population expansion. Below is a ranking of the population growth rate of the counties with State Bank locations according to 2010 U.S. Census Data. Table of Contents County Population Growth (%) State Rank(1) Ohio Franklin +8.8 12th Wood +3.7 31st Fulton +1.5 41st Defiance -1.2 63rd Allen -2.0 69th Lucas -2.9 71st Paulding -3.3 75th Williams -3.9 80th Indiana Allen +7.1 20th (1) Out of 88 counties in Ohio and 92 counties in Indiana. Ohio Economy/Market Ohio s geographic location has proven to be an asset for economic growth and expansion. Based on information reported by the Ohio Development Services Agency, Office of Research (available at http://development.ohio.gov): Ohio is seventh in the nation for total population with approximately 11,570,000 people concentrated in 14 metropolitan areas and 33 micropolitan areas. The largest metropolitan area in Ohio is the Cleveland-Elyria Metropolitan Statistical Area with 2,077,240 people. Other areas with an excess of 500,000 individuals are Akron, Cincinnati, Columbus, Dayton, Toledo, and Youngstown. Ohio s average per capita income for 2013 was $40,865. Ohio s unemployment rate was 5.7% in July 2014 compared to 7.5% in July 2013. The U.S. national rate for July 2013 was 6.2%. Total employment in Ohio is expected to increase 9.3% over the 10-year period from 2010 to 2020, a projected gain of 498,100 jobs. Ohio s gross domestic product was $565.3 billion in 2013, making Ohio the seventh largest state economy. Ohio ranks fourth among the 50 states in manufacturing gross domestic product. Ohio s leading industry is manufacturing, employing 673,800 people, and leads the nation in the production of plastics and rubber, fabricated metals, and electrical equipment and appliances. Ohio is a leading producer of steel, autos and trucks. Roughly 54% of the state s manufacturing output consists of durable goods. The state s two leading export commodities are motor vehicles and machinery, shipping products to 210 countries, accounting for 3.1% of total U.S. exports. Ohio merchandise exports were $50.5 billion in 2013. Ohio s private sector is comprised of 730,393 self-employed firms and 190,184 employer firms, according to the U.S. Small Business Administration. About 3,700 firms employ 500+ workers. Small businesses employing one or more workers account for 20% of all firms and employ 48% of the workforce. Self-employed or non-employer firms comprise 78% of all businesses. Competition We experience significant competition in attracting depositors and borrowers in our markets. In our seven-county primary market area (consisting of Allen, Defiance, Fulton, Lucas, Paulding, Williams and Wood Counties in Ohio), State Bank ranks ninth in deposit market share (4.04%) and competes with a number of national, regional and community financial institutions, including the following: Table of Contents The Huntington National Bank The Huntington National Bank is a large, regional financial institution headquartered in Columbus, Ohio with total assets of approximately $63.7 billion as of June 30, 2014. Huntington National Bank has a total of 47 offices located within our primary market area. The Huntington National Bank ranks first in deposit market share (20.00%) in our primary market area. Huntington National Bank acquired Sky Bank, headquartered in Bowling Green, Ohio, during the third quarter of 2007. Fifth Third Bank Fifth Third Bank is a large, regional financial institution headquartered in Cincinnati, Ohio with total assets of approximately $130.2 billion as of June 30, 2014. Fifth Third Bank has a total of 37 offices located within our primary market area. Fifth Third Bank ranks second in deposit market share (18.17%) in our primary market area. Key Bank National Association Key Bank is a large, regional financial institution headquartered in Cleveland, Ohio with total assets of approximately $89.0 billion as of June 30, 2014. Key Bank has a total of 26 offices located within our primary market area. Key Bank ranks third in deposit market share (9.74%) in our primary market area. First Federal Bank of the Midwest First Federal Bank of the Midwest is a community bank headquartered in Defiance, Ohio with total assets of approximately $2.1 billion as of June 30, 2014. First Federal Bank of the Midwest has a total of 16 offices located within our primary market area. First Federal Bank of the Midwest ranks fourth in deposit market share (7.98%) in our primary market area. PNC Bank, National Association PNC Bank is a large, regional/national financial institution headquartered in Pittsburgh, Pennsylvania with total assets of approximately $316.7 billion as of June 30, 2014. PNC has a total of 20 offices located in our primary market area. PNC Bank ranks fifth in deposit market share (6.66%) in our primary market area. PNC Bank acquired National City Bank, headquartered in Cleveland, Ohio, during the fourth quarter of 2008. RBS Citizens, National Association RBS Citizens is a large, regional financial institution based in Rhode Island with total assets of approximately $100.6 billion as of June 30, 2014. RBS Citizens has a total of 19 offices located in our primary market area. RBS Citizens ranks sixth in deposit market share (5.42%) in our primary market area. The Farmers & Merchants State Bank The Farmers & Merchants State Bank is a community bank headquartered in Archbold, Ohio with total assets of approximately $933.0 million as of June 30, 2014. The Farmers & Merchants State Bank has a total of 16 offices located within our primary market area. The Farmers & Merchants State Bank ranks seventh in deposit market share (5.31%) in our primary market area. Signature Bank Signature Bank is a community bank headquartered in Toledo, Ohio with total assets of approximately $677.0 million as of June 30, 2014. Signature Bank has one office and ranks eighth in deposit market share (4.05%) in our primary market area. JP Morgan Chase Bank, National Association JP Morgan Chase Bank is a large, national financial institution with total assets of approximately $2.0 trillion as of June 30, 2014. JP Morgan Chase Bank has a total of seven offices located within our primary market area. JP Morgan Chase Bank ranks tenth in deposit market share (3.87%) in our primary market area. Waterford Bank, N.A. Waterford Bank is a community bank headquartered in Toledo, Ohio with total assets of approximately $458.3 million as of June 30, 2014. Waterford Bank has two offices and ranks eleventh in deposit market share (3.12%) in our primary market area. The Citizens National Bank of Bluffton The Citizens National Bank of Bluffton is a community bank headquartered in Bluffton, Ohio with total assets of approximately $669.7 million as of June 30, 2014. The Table of Contents Citizens National Bank of Bluffton has a total of six offices located in our primary market area. The Citizens National Bank of Bluffton ranks twelfth in deposit market share (2.47%) in our primary market area. Competitive Strengths As compared to many of our larger competitors, we have a lower efficiency (scale) with numerous, smaller offices in rural locations but excellent depth of services (scope). To leverage the scope of our franchise and deliver on the business strategies noted above, a sales culture designed to address holistic client care was implemented in 2006. Business lines developed and/or expanded were Assets Under Management (AUM) in the wealth management arena, residential real estate lending, retail deposit services, commercial treasury services including cash management, electronic banking, insurance, commercial banking and retail banking. Binding each of these business lines is our holistic approach to client care. Each of the business lines refers business to the other in the spirit of addressing not just the identified, known client need but other, unknown needs as well. This process of working interdependently to achieve holistic client care and drive key growth initiatives is led by the market executive in charge of each of our markets. When this executive-led, robust process to expand services in existing households in traditional, more mature markets is combined with the identification and expansion of new households in lower-share, higher growth markets, our scale improves. Our management team is seasoned and diverse. Our leadership group consists of 14 seasoned executives with combined banking experience in excess of 285 years. Since many of these executives had banking careers elsewhere before leading a business line, division and/or region at SB Financial, they are able to add strength to our management team through diversity, depth of knowledge and the application of best practices. Our management team employs the Balanced Scorecard Management Tools to link strategy to execution. Many companies devise a business plan (such as a one-year tactical plan) as well as a longer-term strategic plan (typically three to five years) to attempt to align what they will accomplish and how they propose to accomplish it. However, we believe that few companies truly integrate these plans. We have put in place a dynamic process that we believe ensures that strategy is linked to execution. Specific initiatives are identified, tracked and measured under the direct leadership of our Chief Executive Officer. Our deposit base is stable and lower cost as compared to our peer group, which is attributable in part to our ability to attract lower-cost deposits in our traditional, more rural markets. With a systemic decline in the yield curve, reflecting an overall slower-growing economy, a lower-cost deposit base provides the required liquidity and duration that allows us to price our loan opportunities more competitively. Our loan portfolio is diverse by geography and segment. As noted above, even though our lending is concentrated in the Midwest (U.S.) and predominantly in Ohio and Northeast Indiana, our regional office dispersion provides a degree of diversity that delivers additional stability in economic contractions. Recent Developments Redemption of Trust Preferred Securities Rurban Statutory Trust I ( RST I ) was established in August 2000 and, in September 2000, completed a pooled private offering of 10,000 trust preferred securities with a liquidation amount of $1,000 per security. The proceeds of the offering were loaned to the Company in exchange for $10 million in principal amount of 10.60% fixed-rate junior subordinated debentures of the Company. The terms of the junior subordinated debentures are substantially similar to the terms of the trust preferred securities issued by RST I. On July 3, 2014, the Company informed the trustee of RST I of the Company s intention to redeem all of the junior subordinated debentures underlying the trust preferred securities prior to their contractual maturity date Table of Contents of September 7, 2030. The Company subsequently redeemed the junior subordinated debentures on September 7, 2014 for an aggregate amount of $11.2 million, which included accrued interest to the redemption date and approximately $425,000 in prepayment penalties. The Company used cash and a term loan from a correspondent bank in the principal amount of $7.0 million to fund the redemption of the junior subordinated debentures. The loan has a term of five years and requires the Company to make quarterly payments of interest and principal based on a 7-year amortization schedule. The loan carries a variable interest rate equal to the 90-day LIBOR index rate plus 2.85%. As of September 18, 2014, the loan s variable interest rate was 3.08%. The loan may be prepaid, in whole or in part, by the Company at any time without penalty or premium. The Company intends to use approximately $7.0 million of the net proceeds of this offering to prepay this term loan in full upon the completion of this offering. The Company s other trust preferred securities, issued by Rurban Statutory Trust II ( RST II ) on September 15, 2005, will remain outstanding following the redemption of the junior subordinated debentures held by RST I. The RST II debt securities, in an aggregate amount of $10.3 million, have a maturity date of September 15, 2035 and carry a variable interest rate that changes quarterly based on the 3-month LIBOR. Transfer of Common Share Listing to the NASDAQ Capital Market Effective as of October 29, 2014, the listing of the Company s common shares was transferred from the NASDAQ Global Market to the NASDAQ Capital Market. This transfer was voluntarily requested by the Company based upon a determination by the Company that the NASDAQ Capital Market would place it among peer financial institutions of comparable size, while at the same time allowing the Company to achieve certain cost savings associated with the Company s listing of the depositary shares as a second class of stock on NASDAQ. The transfer of the Company s common share listing to the NASDAQ Capital Market is not expected to have any impact on the trading in the Company s common shares, and the Company s common shares continue to trade under the symbol SBFG. Results of Operations for the Three and Nine Months Ended September 30, 2014 On October 22, 2014, the Company reported earnings for the third quarter and nine months ended September 30, 2014. Highlights included: Net income of $1.5 million for the third quarter represented a 22% increase over the quarter ended June 30, 2014 (the linked quarter ) and a 13% increase over the quarter ended September 30, 2013 (the year-ago quarter ); Quarterly results included a $0.43 million prepayment penalty for the early redemption of the junior subordinated debentures underlying the Company s fixed-rate trust preferred securities, which impacted net income by $0.06 per diluted share; Loan growth was up $30.7 million, or 6.5%, from the prior year; The ratio of nonperforming assets to total assets continued to decline to 0.81%; and Operating expenses, excluding the trust preferred prepayment penalty, were flat compared with the year-ago and linked quarters. Results of Operations Consolidated Revenue Total revenue, consisting of net interest income on a fully tax equivalent (FTE) basis and noninterest income, was up 3.0% from the third quarter of 2013, and up 7.1% from the linked quarter. Net interest income (FTE) was up 3.3% from the third quarter of 2013, and up 1.9% compared to the linked quarter Table of Contents Net interest margin (FTE) was down 8 basis points from the third quarter of 2013, but up 4 basis points from the linked quarter Noninterest income was up $0.1 million, or 2.7%, for the third quarter, and up $0.5 million, or 15.6%, from the linked quarter Total revenue, consisting of net interest income on an FTE basis and noninterest income, for the first nine months of 2014, was $25.4 million compared to $27.2 million for the first nine months of 2013. The nine-month results were impacted by lower mortgage origination volume during the first quarter of 2014 and the reduction in the yield on earning assets. Mortgage Loan Business In line with the linked quarter, mortgage loan originations for the third quarter of 2014 were $67.0 million, up $11.8 million, or 21.4%, from the year-ago third quarter. For the first nine months of 2014, mortgage loan originations were $167.7 million, down from $209.1 million for the first nine months of 2013. Net mortgage banking income, consisting of gains on the sale of mortgage loans and net loan servicing fees, was $1.7 million for the third quarter of 2014, compared to $1.8 million for the year-ago quarter. Net mortgage banking income was $3.9 million for the nine-months ended September 30, 2014 as compared to $5.3 million for the comparable period in 2013. The mortgage servicing portfolio at September 30, 2014, was $649.7 million, up $52.7 million, or 8.8%, from September 30, 2013. Fee Income and Noninterest Expense The Company s fee income includes revenue from a diverse group of services, such as wealth management, deposit fees and income from bank-owned life insurance. Wealth management assets under management stood at $326.5 million as of September 30, 2014. For the third quarter of 2014, fee income as a percent of total revenue was 41.6%, down slightly from the prior year. For the first nine months of 2014, fee income as a percentage of total revenue was 38.5%. For the third quarter of 2014, noninterest expense (NIE) was up $0.3 million, or 5.0%, compared to the third quarter of 2013. However, when adjusted for the $0.33 million in operating expense related to the trust preferred securities prepayment, expenses for the quarter were in line with the prior year. For the first nine months of 2014, operating expenses were down $0.7 million, or 3.5%, compared to the first nine months of 2013. When adjusted for the trust preferred securities prepayment, expenses for the first nine months of 2014 were down $1.1 million, or 5.2%, compared to the prior-year period. Balance Sheet Total assets as of September 30, 2014, were $664.6 million, up 4.9% from a year ago. Total equity as of September 30, 2014, was $60.3 million, up 8.5% from a year ago. Total loans held for investment (HFI) were $505.9 million at September 30, 2014, up $30.7 million, or 6.5%, from September 30, 2013. Residential real estate loans accounted for the majority of the loan growth, up $11.2 million, or 11.6%. Commercial and commercial real estate loans also rose $8.9 million and $3.2 million, respectively. The investment portfolio, including Federal Reserve Bank and Federal Home Loan Bank stock, of $84.9 million represented 12.8% of assets at September 30, 2014, and was down slightly from a year ago. Deposit balances of $535.3 million at September 30, 2014, increased by $13.7 million since September 30, 2013. Growth from the prior year included $7.0 million in checking and $6.7 million in savings and time deposit balances. Table of Contents Asset Quality The Company continues to improve its asset quality, reporting nonperforming assets of $5.4 million as of September 30, 2014, down $3.4 million, or 38.8%, from the year-ago quarter. Already trending better than our key peer metrics, the 0.81% of nonperforming assets to total assets was the lowest the Company has recorded since the first quarter of 2007. Coverage of problem loans by the loan loss allowance was 139% at September 30, 2014. During the third quarter, our delinquency level (loans past due 30 days or more) did rise to 1.2% from 0.6% in the linked quarter. This increase was driven by one commercial real estate loan for $3.7 million that is in the process of restructure. Capitalization Improving the Company s capital ratios remains an important focus of management. The tangible equity ratio improved by 50 basis points over the past year and stood at 6.7% as of September 30, 2014. All bank regulatory ratios remained in excess of well-capitalized levels at September 30, 2014. At September 30, 2014, State Bank s Total Risk-Based Capital was estimated to be $63.0 million, $21.6 million above the well-capitalized level. The Total Risk-Based Capital Ratio was estimated at 12.2% at September 30, 2014. Highlights (Dollars in thousands except ratios and per share data) At September 30, 2014 At December 31, 2013 Selected Financial Condition Data: Cash and due from banks $ 21,870 $ 13,137 Total investment securities (1) 84,896 93,541 Loans held for sale 6,736 3,366 Net loans receivable 499,211 470,339 Mortgage servicing rights 5,720 5,180 Total deposits 535,261 518,234 Notes payable 7,000 589 Advances from FHLB 30,000 16,000 Repurchase agreements 17,902 14,696 Trust preferred securities 10,310 20,620 Total Equity 60,266 56,269 Capital and Liquidity Ratios: Loans / Deposits 94.52 % 92.10 % Tangible equity / Tangible assets 6.73 % 6.39 % Asset Quality Ratios: Nonaccruing loans / Total loans 0.63 % 1.01 % Nonperforming loans / Total loans 0.95 % 1.38 % Nonperforming assets / Loans & OREO 1.06 % 1.51 % Nonperforming assets / Total assets 0.81 % 1.15 % Allowance for loan loss / Nonperforming loans 139.22 % 105.79 % Allowance for loan loss / Total loans 1.33 % 1.46 % Table of Contents For the Three Months Ended For the Nine Months Ended September 30, 2014 September 30, 2013 September 30, 2014 September 30, 2013 Selected Operating Data: Interest income $ 6,321 $ 6,146 $ 18,218 $ 18,913 Interest expense 971 971 2,795 3,096 Net interest income 5,350 5,175 15,423 15,817 Provision for loan losses 150 401 300 900 Net interest income after provision 5,200 4,774 15,123 14,917 Non-interest income 3,809 3,710 9,663 11,097 Non-interest expenses 6,888 6,562 19,593 20,312 Income before income tax expense 2,121 1,922 5,193 5,702 Income tax expense 608 578 1,455 1,721 Net income $ 1,513 $ 1,344 $ 3,738 $ 3,981 Diluted earnings per share $ 0.31 $ 0.28 $ 0.76 $ 0.82 Adjusted for TRUP Prepayment: (2) Net interest income after provision $ 5,294 $ 4,774 $ 15,217 $ 14,917 Non-interest expenses 6,557 6,562 19,262 20,312 Net income 1,794 1,344 4,018 3,981 Diluted earnings per share 0.37 0.28 0.82 0.82 Performance Ratios: Return on average assets 0.90 % 0.84 % 0.75 % 0.83 % Return on average common equity 10.14 % 9.82 % 8.54 % 9.78 % Efficiency ratio (3) 74.61 % 72.40 % 76.84 % 73.85 % Net interest margin (FTE) 3.64 % 3.72 % 3.54 % 3.81 % (1) Includes available-for sale securities and Federal Reserve and Federal Home Loan Bank stock. (2) Adjustment/Reconciliation: Adjusted to exclude the impact of the repayment of the junior subordinated debentures underlying the Company s fixed-rate trust preferred securities on September 7, 2014 for an aggregate amount of $11,200, which included approximately $425 in prepayment penalties. Line items adjusted were interest expense ($94) and non-interest expense ($331). An effective tax rate of 34.0% was used to compute impact on net income. (3) Calculation excludes intangible amortization. Table of Contents THE OFFERING Issuer SB Financial Group, Inc. Securities offered Depositary shares, each representing a 1/100th ownership interest in a Series A Preferred Share with a liquidation preference of $1,000.00 per share (equivalent to $10.00 per depositary share). Each holder of a depositary share will be entitled, through the depositary, in proportion to the applicable fraction of a Series A Preferred Share represented by such depositary share, to all of the rights, preferences and privileges of the Series A Preferred Shares represented thereby, including dividend, voting, conversion and liquidation rights. We are offering up to a maximum of 1,500,000 depositary shares in the offering. We must sell a minimum of 1,000,000 depositary shares to complete the offering. Price per depositary share $10.00. Ranking The Series A Preferred Shares (and, therefore, the depositary shares) will rank, with respect to dividends and upon liquidation, dissolution or winding-up: (i) junior to all of our existing and future debt obligations; (ii) junior to each class of capital stock or series of preferred shares, the terms of which expressly provide that it ranks senior to the Series A Preferred Shares; (iii) on parity with each other class of our capital stock or series of preferred shares, the terms of which expressly provide that it ranks on parity with the Series A Preferred Shares; and (iv) senior to all classes of our common shares or series of preferred shares, the terms of which do not expressly provide that it ranks senior to or on parity with the Series A Preferred Shares. See Description of the Series A Preferred Shares Ranking beginning on page 52 of this prospectus. Dividends 6.50% per annum of the liquidation preference, which is equivalent to $0.65 per year and $0.1625 per quarter per depositary share. Dividends are noncumulative and are payable only if, when and as declared by our board of directors. As a result, if no dividend is declared by our board of directors on the Series A Preferred Shares for a quarterly dividend period, holders of depositary shares will have no right to receive a dividend for that period. See Description of the Series A Preferred Shares Dividend Rights beginning on page 52 of this prospectus. Dividend payment dates Dividends are payable quarterly, when, as and if declared by our board of directors, on March 15, June 15, September 15 and December 15 of each year (or if such day is not a business day, the next business day), commencing March 15, 2015. Dividends for the first dividend period ending March 15, 2015, if any, will be for less than a full quarter if the offering closes after December 15, 2014, and will be for greater than a full quarter if the offering closes before December 15, 2014. Table of Contents Dividend stopper We are prohibited from paying dividends on our common shares or any other capital security which ranks junior to the Series A Preferred Shares unless the full dividends on all outstanding Series A Preferred Shares (and, therefore, the depositary shares) have been declared and paid (or set apart for payment) for the most recently completed dividend period. See Description of the Series A Preferred Shares Dividend Rights beginning on page 52 of this prospectus. No Redemption The Series A Preferred Shares may not be redeemed at the option of the Company. Liquidation rights In the event we liquidate, dissolve or wind-up our business and affairs, either voluntarily or involuntarily, holders of the Series A Preferred Shares will be entitled to receive a liquidating distribution of $1,000.00 per share (equivalent to $10.00 per depositary share), plus any declared and unpaid dividends, without accumulation of any undeclared dividends, before we make any distribution of assets to the holders of our common shares or any other class or series of junior shares. Distributions will be made only to the extent of our assets that are available after satisfaction of all liabilities to creditors and subject to the rights of holders of any securities ranking senior to the Series A Preferred Shares and pro rata as to the Series A Preferred Shares and any other shares of our stock ranking equally as to such distribution. Holders of Series A Preferred Shares (and, therefore, holders of depositary shares) will not be entitled to any other amounts from us after they have received their full liquidating distribution. See Description of the Series A Preferred Shares Liquidation Preference beginning on page 54 of this prospectus. Voting rights Except as otherwise required by Ohio law and as set forth below, a holder of Series A Preferred Shares (and, therefore, a holder of depositary shares) will have no voting rights. The consent of the holders of at least two-thirds (2/3) of the Series A Preferred Shares (and, therefore, the depositary shares), voting as a class, will be required to (i) amend, alter or repeal any provision of our Amended Articles of Incorporation, as amended (the Articles ) or the attachment to the certificate of amendment by the directors setting forth the terms of the Series A Preferred Shares (the Certificate of Amendment ) in a manner that would materially and adversely affect the rights, preferences, powers or privileges of the Series A Preferred Shares, (ii) create, authorize, issue or increase the authorized or issued amount of any class or series of our equity securities that is senior to or on parity with the Series A Preferred Shares as to dividend rights, or rights upon our liquidation, dissolution or winding-up (except that no consent will be required in the case of parity shares which do not have cumulative dividend rights) or (iii) enter into or consummate certain reclassifications of our common shares or certain business combinations. See Description of the Series A Preferred Shares Voting Rights beginning on page 60 of this prospectus. The consent of the holders of the Series A Preferred Shares (and, therefore, the holders of depositary shares) will not be required in connection with any of the following: (i) any increase in the authorized number of Series A Table of Contents Preferred Shares; (ii) any issuance of additional Series A Preferred Shares; or (iii) any increase, authorization or issuance of equity securities which are on parity with the Series A Preferred Shares as to dividend rights, or rights upon liquidation, dissolution or winding up, unless such equity securities have cumulative dividend rights. No maturity The Series A Preferred Shares do not have any maturity date, and we cannot redeem the Series A Preferred Shares at our option. Accordingly, the Series A Preferred Shares will remain outstanding indefinitely, unless and until we decide to exercise our right of mandatory conversion. Conversion right Each Series A Preferred Share, at the option of the holder, is convertible at any time into the number of our common shares equal to $1,000.00 divided by the conversion price then in effect, which initially will be $10.34. Accordingly, each depositary share is convertible at your option into the number of our common shares equal to $10.00 divided by the conversion price then in effect (initially $10.34). The initial conversion price of $10.34 is equivalent to a 17.5% premium over $8.80 per common share, the last reported sale price of our common shares on November 5, 2014. Except as otherwise provided, the Series A Preferred Shares (and, therefore, the depositary shares) will only be convertible into our common shares, and cash will be paid in lieu of issuing any fractional common share interest. The conversion price is also subject to anti-dilution adjustments upon the occurrence of certain events. See Description of the Series A Preferred Shares Adjustments to the Conversion Price beginning on page 57 of this prospectus. All of the depositary shares we are selling in this offering, and the common shares issued upon any conversion of the depositary shares, will be freely tradable without restriction under the Securities Act, except for shares purchased by our affiliates. See Description of the Series A Preferred Shares Conversion Rights beginning on page 54 of this prospectus. Mandatory conversion at our option On or after the fifth anniversary of the issue date of the Series A Preferred Shares, we may, at our option, require holders of the Series A Preferred Shares (and, therefore, the depositary shares) to convert each Series A Preferred Share into the number of our common shares equal to the quotient achieved when $1,000.00 is divided by the conversion price then in effect, which initially will be $10.34. Accordingly, each depositary share will be convertible into the number of our common shares equal to $10.00 divided by the conversion price then in effect (initially $10.34). We may exercise this option only if: (i) the closing sale price for our common shares equals or exceeds 120% of the conversion price then in effect for at least 20 trading days in a period of 30 consecutive trading days (including the last trading day of such period) ending on the fifth trading day immediately prior to our issuance of a press release announcing our exercise of this option; and (ii) we have declared and paid full dividends on the Series A Preferred Shares (and, therefore, the depositary shares) for four consecutive quarters prior to the issuance of the press release. See Description of the Series A Preferred Shares Mandatory Conversion at Our Option beginning on page 56 of this prospectus. Table of Contents Material U.S. federal income tax consequences Material U.S. federal income tax consequences relevant to the acquisition, ownership and disposition of the depositary shares and common shares issued upon conversion are described in Material U.S. Federal Income Tax Consequences beginning on page 71 of this prospectus. Prospective investors should consult their own tax advisors regarding the tax consequences of acquiring, holding and disposing of the depositary shares and common shares issued upon conversion in light of current tax laws, their particular personal tax and investment circumstances and the application of state, local and other tax laws. Purchase priorities and limitations We are offering the depositary shares for sale to the public in the following order of priority: 1. Shareholder Offering Each shareholder of the Company who is a beneficial owner of our common shares will be given the opportunity to purchase, subject to the overall purchase limitations, up to the lesser of (a) 250,000 depositary shares ($2,500,000), or (b) the number of depositary shares, assuming conversion of such depositary shares into our common shares, whereby the purchaser s total beneficial ownership of our common shares (including any common shares currently owned) would not exceed 5% of our outstanding common shares after the offering. The minimum number of depositary shares that an existing shareholder may purchase in the offering is 100 depositary shares. If there are not sufficient depositary shares available to satisfy all subscriptions in the shareholder offering, shares will first be allocated so as to permit each shareholder subscriber to purchase a number of depositary shares equal to the lesser of (i) 10,000 depositary shares ($100,000) or (ii) the number of depositary shares for which the shareholder subscribed. The unallocated depositary shares will then be allocated to each shareholder subscriber whose subscription remains unsatisfied on a pro rata basis. See Description of the Offering. 2. Customer and Local Community Offering To the extent that depositary shares remain available for purchase after satisfaction of all subscriptions in the shareholder offering, we may offer depositary shares to customers of State Bank and to residents of the local communities we serve. For this purpose, you will be considered to be a resident of the local communities we serve if you reside in any of the following counties: Allen, Defiance, Franklin, Fulton, Lucas, Paulding, Wood and Williams Counties, Ohio; and Allen and Steuben Counties, Indiana. The same purchase limitations and pro rata allocations that apply in the shareholder offering will apply to purchases in the customer and local community offering to the extent there are not sufficient depositary shares available to satisfy all subscriptions. See Description of the Offering. Table of Contents 3. Syndicated Offering We may offer depositary shares for sale to interested investors (without regard to their status as an existing shareholder of the Company, a customer of State Bank, or a resident of our local communities) in a syndicated offering in a manner intended to achieve a widespread distribution of our depositary shares to the general public. The syndicated offering may begin concurrently with, during or after the commencement or termination of the shareholder and customer/local community offerings, but priority will be given to shareholder and customer/local community subscriptions in filling orders. If a syndicated offering is held, Keefe, Bruyette & Woods, Inc. will serve as sole placement agent and will assist us in selling our depositary shares on a best efforts basis. The same purchase limitations that apply in the shareholder offering will apply to purchases in the syndicated offering to the extent there are not sufficient depositary shares available to satisfy all subscriptions. See Description of the Offering. Purchasing depositary shares in the offering The shareholder offering and the customer and local community offering are expected to be conducted concurrently. The syndicated offering, if any, may be conducted concurrently with the shareholder and customer/local community offerings or as soon as practicable following the expiration of the shareholder and customer/local community offerings. In the shareholder and customer/local community offerings, you may subscribe for depositary shares by delivering a signed and completed order form, together with full payment payable to U.S. Bank/SBFG Escrow Account ; provided that the order form is received before 3:00 p.m., Eastern Time, on December 12, 2014, unless the expiration date of the offering is extended. Delivery of your order may be made by mail using the order reply envelope provided, by overnight delivery to the indicated address at the top of the order form, or by hand-delivery to the Company s executive offices located at 401 Clinton Street, Defiance, Ohio. Order forms may not be delivered to any of the Company s or State Bank s other offices. Please do not mail order forms to the Company or any of State Bank s branches. Payment in the shareholder and customer/local community offerings may be made by personal check, bank check or money order, payable to U.S. Bank/SBFG Escrow Account . You may not use cash, wires or a check drawn on a State Bank line of credit, and third party checks will not be accepted. Checks and money orders will be immediately cashed and placed in the escrow account. Orders in the syndicated offering will be submitted in substantially the same manner as utilized in the shareholder and customer/local community offerings. Payments in the syndicated offering, however, must be made in immediately available funds (bank checks, money orders, or wire transfers). Personal checks will not be accepted. If the closing of the offering does not Table of Contents occur for any reason, the funds will be promptly returned without interest. For a complete description of how to purchase depositary shares in the offering, see Description of the Offering. Use of proceeds We estimate that the net proceeds to us from the sale of the maximum number of depositary shares that we may sell in this offering will be $14.0 million after deducting estimated placement agent fees and other offering expenses. We intend to use approximately $7.0 million of the net proceeds of the sale of the depositary shares to prepay the term loan obtained by the Company in connection with the Company s redemption, effective September 7, 2014, of the junior subordinated debentures underlying the trust preferred securities issued by RST I for an aggregate redemption amount (including accrued interest and prepayment penalties) of $11.2 million. See Summary Recent Developments beginning on page 9 of this prospectus. We expect to use the remainder of the net proceeds from the sale of our depositary shares for general corporate purposes. See Use of Proceeds beginning on page 34 of this prospectus. Risk factors You should read this prospectus carefully before you invest. Investing in our securities involves a high degree of risk. See the section entitled Risk Factors, beginning on page 22 of this prospectus and in the documents we file with the Securities and Exchange Commission that are incorporated by reference into this prospectus for certain risks you should consider before investing in the depositary shares. Listing We have applied for the depositary shares to be listed on the NASDAQ Capital Market under the symbol SBFGP. If the application for listing is approved, trading of the depositary shares is expected to commence within 30 days following the initial issuance of the depositary shares. Form The depositary shares will be issued and maintained in book-entry form, except under limited circumstances. See Description of the Depositary Shares Book-Entry Issuance beginning on page 64 of this prospectus. Depositary, transfer agent and registrar Computershare Inc. and its wholly-owned subsidiary, Computershare Trust Company, N.A. ( Computershare ) Table of Contents
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+PROSPECTUS SUMMARY The following summary is qualified in its entirety by the more detailed information and the financial statements and notes thereto appearing elsewhere in this Prospectus. Prospective investors should consider carefully the information discussed under RISK FACTORS and USE OF PROCEEDS sections, commencing on pages 7 and 15, respectively. An investment in our securities presents substantial risks, and you could lose all or substantially all of your investment. Corporate Background and Business Overview Our Company was incorporated in the State of Nevada on July 8, 2014 to engage in the development and operation of a business engaged in the distribution of glass craft products produced in China. We are a development stage company and also considered an Emerging Growth Company Our fiscal year end is July 31st. Our executive offices are located at 8153 Finch Feather St., Las Vegas, NV 89143. Our phone number is (775) 572-8824. On July 28, 2014 we purchased an office and small shop for US$8,000, located at: Jaunciema gatve 40, Zieme u rajons, R ga, LV-1023, Latvia. The primary activities at the Las Vegas location will be carried out by our sole employee and CEO, Andris Berzins. He will be working from this location as his schedule permits, to process sales, oversee company operations in US, make sure our business plan in implemented as it should including verifying that orders are fulfilled properly, regular office work (processing incoming mail, making phone calls to customers and suppliers, etc.) and working on our website content. Mr. Berzins will also travel to Latvia, to work in the office in the shop there; to create a plan to reach out to potential customers in European Union (EU), to locate less expensive potential suppliers of our offered products, to process incoming mail in Latvia from local authorities, to keep all required paperwork in up to date state, working on content of our company website in Latvian language (for local customers) with the goal of reaching out to more customers to make our company more successful. We require a minimum funding of $12,990 to conduct our business over the next 12 months, and if we are unable to obtain this level of financing, our business may fail. We are in the early stages of developing our plan to distribute glass craft products, in forms including but not limited to glass crafts, novelties, knobs, trophies, vases, glasses, boxes, bowls, trays, plates . We currently have some operating history which includes revenues and cost of sales. Our plan of operations over the 12 month period following successful completion of our Offering is to develop and establish our glass craft products distribution business and hire three more salespeople (See Business of the Company and Plan of Operations ). From inception until the date of this filing we have had limited operating activities, primarily consisting of the incorporation of our company and the initial equity funding by our sole officer and director. We have generated some revenues and our principal business activities to date have consisted of creating a business plan and entering into a Supply Agreement, dated July 10, 2014, with three Chinese companies, Xiamen Ebei Import & Export Co., Ltd. ( Xiamen Ebei ), Yangzhou Kanglong Glass Arts Co., Ltd. ( Yangzhou Kanglong ), and Yancheng Sunrise Import & Export Co.,Ltd. ( Yancheng Sunrise ). Xiamen Ebei, Yangzhou Kanglong and Yancheng Sunrise are large and well-established suppliers and distributors of glass craft products in China. The terms and conditions of the Supply Agreement provide that, among other things, we have the right to purchase a variety of glass craft products (including crafts, novelties, knobs, trophies, vases, glasses, boxes, bowls, trays and plates) produced by each of the companies. The agreements also outline the following basic terms (see Agreements for the full terms): 1. The term of each agreement began on August 1, 2014 and expires August 1, 2018. 2. Summit will give the Supplier (Seller) 60 days notice regarding the quantity requested for delivery. Supplier will arrange delivery through a carrier chosen by the Supplier , the cost of which shall be F.O.B. 3. The agreement between Summit and the Supplier is non-exclusive. 4. The prices to be paid by Summit under the Supply Agreements are fixed by agreement between Summit and the Supplier. Prices are exclusive of all taxes, insurance and shipping and handling charges which are Summit s responsibility. 5. Summit (and its customers) has the right to inspect the goods upon receipt and notify the Supplier of any claim for damages. If any defect or damages is identified the Supplier will replace or repair the goods or refunds the purchase price at the Suppliers option. While we have entered into supply agreements with these three suppliers, we can make no assurance that we will be able to maintain these third-party relationships or establish additional relationships as necessary to support growth and profitability of our business on economically viable terms. As independent companies, these glass craft products suppliers make their own business decisions. Such suppliers may choose not to do business with us for a variety of reasons, including competition, brand identity, product standards and concerns regarding our economic viability. They may have the right to determine whether, and to what extent, they will produce and distribute the products we need for resale. In addition, their financial condition could also be adversely affected by conditions beyond our control and our business could suffer. We received our initial funding of $4,000 through the sale of common stock to our sole officer and director, who purchased 4,000,000 shares at $0.001 per share. Our financial statements from inception on July 8, 2014 through our first fiscal year ended July 31, 2014 report $30,100 in revenues and a net income of $5,090. Our independent salesman Rob Johnson contacted many potential buyers. From those contacts he received four purchase orders for glass craft products totaling $30,000 from one buyer. The products ordered were readily available, off the shelf products from one of our suppliers and were available for immediate shipment to the buyer; the shipping costs were $100 which was passed on to the buyer for Total Revenues of $30,100. Mr. Johnson was paid a commission of $2,050 and the product cost from the supplier was $20,950, resulting in a gross profit of $23,000. Our independent registered public accountant has issued an audit opinion for our Company which includes a statement expressing substantial doubt as to our ability to continue as a going concern. The following is a brief summary of this Offering: THE OFFERING The Issuer: Summit Networks Inc Securities Being Offered: 2,000,000 shares of common stock Price Per Share: $0.04 Common stock outstanding before the Offering: 4,000,000 shares of common stock Common stock outstanding after completion of the Offering 6,000,000 shares of common stock (assuming the sale of all 2,000,000 shares being offered) Duration of the Offering: The Offering will commence promptly on the date upon which this Prospectus is declared effective by the SEC and will continue for 180 days. At the discretion of our management, we may close the Offering before expiration of the 180 day period if all the shares are sold or extend the Offering for up to 90 days following the expiration of the 180-day Offering period. Manner of Offering The Offering is a self-underwritten, direct primary offering with no minimum purchase requirement. Net Proceeds $80,000 (assuming the sale of all 2,000,000 being offered) Securities Issued and Outstanding: There are 4,000,000 shares of common stock issued and outstanding as of the date of this Prospectus, held by our sole officer and director, Andris Berzins. Anticipated Total Registration Costs: We estimate our total offering registration costs to be approximately $9,000 Risk Factors: See Risk Factors and the other information in this Prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock. Summary of Financial Information The summarized financial data presented below is derived from, and should be read in conjunction with, our audited financial statements and related notes from July 8, 2014 (date of inception) to July 31,2014, included on Page F-1 in this Prospectus. Financial Summary July 31, 2014 Cash and Deposits $ 110 Total Assets $ 9,110 Total Liabilities $ 20 Total Stockholder s Equity $ 9,090 Statement of Operations July 31, 2014 Revenue $ 30,100 Cost of Goods Sold $ 20,950 Selling, General & Administrative Expenses $ 4,060 Net Income $ 5,090 We have just commenced our operations and though our financial statements as of July 31, 2014 showed a net profit of $5,090, we anticipate that we will incur net losses from our operations for the foreseeable future.
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should read this entire prospectus carefully, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and related notes. As used in this prospectus, unless the context otherwise requires, references to Sportsman s Warehouse, we, us, and our refer to Sportsman s Warehouse Holdings, Inc. and its subsidiaries and references to Holdings refer to Sportsman s Warehouse Holdings, Inc. excluding its subsidiaries. Who We Are Sportsman s Warehouse is a high-growth outdoor sporting goods retailer focused on meeting the everyday needs of the seasoned outdoor veteran, the first-time participant and every enthusiast in between. Our mission is to provide a one-stop shopping experience that equips our customers with the right hunting, shooting, fishing and camping gear to maximize their enjoyment of the outdoors. We strive to accomplish this goal by tailoring our broad and deep merchandise assortment to meet local conditions and demand, offering everyday low prices, providing friendly support from our knowledgeable, highly trained staff and offering extensive in-store events and educational programming. These core strategies help position Sportsman s Warehouse as the local outdoor experts and the preferred place to both shop and share outdoor-based experiences in the communities we serve. As a result, we are expanding our loyal customer base in existing markets and increasing our store footprint in new markets, which we believe will further drive our growth and profitability. Sportsman s Warehouse was founded in 1986 as a single retail store in Midvale, Utah and has grown to 49 stores across 18 states. Today, we have the largest outdoor specialty store base in the Western United States and Alaska. Our stores range from 30,000 to 65,000 gross square feet, with an average size of approximately 48,000 gross square feet. Our store layout is adaptable to both standalone locations and strip centers. Based on publicly available information, we believe it is less capital-intensive for us to open new stores compared to our principal competitors because our no frills store layout requires less initial cash investment to build out and our stores generally require less square footage than the stores of our competitors. Together, these features enable us to effectively serve markets of multiple sizes, from Metropolitan Statistical Areas, or MSAs, with populations of less than 75,000 to major metropolitan areas with populations in excess of 1,000,000, while generating consistent four-wall Adjusted EBITDA margins and returns on invested capital across a range of store sales volumes. We believe that the foregoing attributes have positioned us to deliver strong financial results, as evidenced by the following: Organic store unit growth of 42.3% over the past three fiscal years, representing a compound annual growth rate of 12.5%; Positive same store sales growth for 15 of the last 16 consecutive fiscal quarters compared to the corresponding fiscal quarter of the prior fiscal year, 13 of which have had increases of 10% or more; Strong and consistent new store performance, with an average four-wall Adjusted EBITDA margin of 13.8% in the first twelve months of operations and an average pre-tax payback period of less than one year excluding initial inventory cost (or an expected average pre-tax payback period of less than 2.5 years including initial inventory cost) for our eight most recently opened stores that have been open for a full twelve months; Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS Subject to Completion. Dated April 14, 2014 12,500,000 Shares Sportsman s Warehouse Holdings, Inc. Common Stock This is an initial public offering of shares of common stock of Sportsman s Warehouse Holdings, Inc. We are offering 8,333,333 of the shares to be sold in this offering. The selling stockholder identified in this prospectus is offering an additional 4,166,667 shares. We will not receive any of the proceeds from the sale of the shares being sold by the selling stockholder, including any shares sold by the selling stockholder in connection with the exercise of the underwriters option to purchase additional shares. Prior to this offering, there has been no public market for our common stock. It is currently estimated that the initial public offering price per share will be between $11.00 and $13.00. We intend to list our common stock on The NASDAQ Global Select Market under the symbol SPWH. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act and, as such, will be subject to reduced public company reporting requirements. See Risk Factors on page 14 to read about factors you should consider before buying shares of our common stock. Price to Public Underwriting Discounts and Commissions(1) Proceeds to Sportsman s Warehouse Proceeds to Selling Stockholder Per Share $ $ $ $ Total $ $ $ $ (1) We refer you to Underwriting beginning on page 109 of this prospectus for additional information regarding underwriting compensation. To the extent that the underwriters sell more than 12,500,000 shares of common stock, the underwriters have the option to purchase up to an additional 468,750 shares from us and an additional 1,406,250 shares from the selling stockholder identified in this prospectus at the initial price to the public less the underwriting discount. We will not receive any proceeds from the sale of any of the additional shares by the selling stockholder. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Delivery of the shares of common stock will be made on or about , 2014. Credit Suisse Goldman, Sachs & Co. Baird William Blair Piper Jaffray Wells Fargo Securities D.A. Davidson & Co. Prospectus dated , 2014. Table of Contents Net sales of $643.2 million for fiscal year 2013, representing a compound annual growth rate of 30.7% from net sales of $376.6 million for fiscal year 2011; and Income from operations of $60.0 million for fiscal year 2013, representing a compound annual growth rate of 50.2% from income from operations of $26.6 million for fiscal year 2011. Four-wall Adjusted EBITDA means, for any period, a particular store s Adjusted EBITDA, excluding any allocations of corporate selling, general and administrative expenses allocated to that store. Four-wall Adjusted EBITDA margin means, for any period, a store s four-wall Adjusted EBITDA divided by that store s net sales. For a definition of Adjusted EBITDA and Adjusted EBITDA margin and a reconciliation of net income to Adjusted EBITDA, see Summary Consolidated Financial and Operating Data. Pre-tax payback period means, for a given store, the number of years from and after its opening that it takes for the cumulative four-wall Adjusted EBITDA for that store to equal our total cash investment in that store. Return on invested capital, or ROIC, means a store s four-wall Adjusted EBITDA for a given period divided by our initial cash investment in the store. We calculate ROIC both including and excluding the initial inventory cost. Our Industry We compete in the large, growing and fragmented outdoor activities and sporting goods market, which we believe is currently underserved by full-line multi-activity retailers. We believe, based on reports by the National Sporting Goods Association, or NSGA, and other industry sources, that U.S. outdoor activities and sporting goods retail sales totaled over $50 billion in 2012. The 2011 U.S. Fish and Wildlife national survey, published once every five years, found that hunting and fishing participation increased 9% and 11%, respectively, for Americans ages 16 and older from 2006 to 2011. We believe growth in the U.S. outdoor activities and sporting goods market is driven by several key trends, including: an expanding demographic focused on healthy and active lifestyles; successful new product introductions centered around enhancing performance and enjoyment while participating in sporting and outdoor activities; and the resilience of consumer demand for purchases in these categories versus other discretionary categories. Category sales within our total addressable market are highly fragmented across a wide variety of retail formats, including national chains, specialty retailers, regional department stores, mass discount stores and independents. Over the past decade, specialty retailers, such as us, have gained an increasing share of equipment sales at the expense of mass merchants, discount stores and independents, or mom & pop shops, which we believe comprise approximately 65% of the market. We believe this fragmentation within the total addressable market presents an attractive opportunity for us to continue to expand our store base and market share, as customers increasingly prefer a broad and appealing selection of locally relevant merchandise, competitive prices, high levels of customer service and one-stop shopping convenience. Our Competitive Strengths We believe the following competitive strengths allow us to capitalize on the growth opportunity within the outdoor activities and sporting goods market: Differentiated Shopping Experience for the Seasoned Outdoor Veteran, the First-Time Participant and Every Enthusiast in Between. We place great emphasis on creating an inviting and engaging store experience for customers of all experience levels. For the seasoned outdoor veteran, we offer a one-stop, convenient store layout that promotes easy-in, easy-out access to replenish supplies, learn about local conditions and test products. We also serve first-time participants and casual users who are interested in enjoying the outdoors but enter our store without a clear sense for what equipment they need for their chosen activity. Our highly trained employees, who often are outdoor enthusiasts themselves and users of the products we sell, engage and interact with our Table of Contents Table of Contents customers in order to educate them and equip them with the right gear. Our sales associates draw upon both formal vendor sales training as well as first-hand experiences from using our products in local conditions. This selling approach allows us to offer a broad range of products and to deliver a shopping experience centered on the customer s needs, which we believe results in increased customer loyalty, repeat visits and frequent referrals to other potential customers. A customer s shopping experience in our stores is further enhanced by a variety of helpful in-store offerings and features, including the issuance of hunting and fishing licenses, local fishing reports, availability of Sportsman s News (our proprietary in-store newspaper), access to the Braggin Board (where customers can post photos of their outdoor adventures), indoor test ranges for archery equipment and displays of customer-owned taxidermy. In addition, we host a variety of in-store programs (such as ladies night ), contests (such as Bucks & Bulls, a free-to-enter, big-game trophy contest) and a wide range of instructional seminars, from turkey frying to firearm operation and safety. These programs are all designed to help our customers connect with the outdoors and build the skill sets necessary to maximize enjoyment of their chosen activities. As a result, we believe our stores often serve as gathering spots where local enthusiasts can share stories, product knowledge and advice on outdoor recreation activities, which both drives traffic and fosters customer loyalty. Locally Relevant Merchandise Serving the Comprehensive Needs of Outdoor Enthusiasts at a Compelling Value. We offer our customers an extensive and carefully selected assortment of branded, high-quality outdoor products at competitive prices. We accomplish this in three principal ways: Locally Relevant Merchandise: We carry over 70,000 SKUs on average in each store, out of a pool of approximately 130,000 total SKUs. SKUs is an acronym for stock-keeping units, which are unique alphanumeric identifiers assigned to a particular product that allow it to be tracked for inventory purposes. Each store s merchandise is tailored to meet local conditions and consumer demand, taking into account seasonal requirements, regional game and fishing species, geographic diversity, weather patterns and key demographic factors, so that our customers have the right product, at the right time, for the right location. Breadth and Mix of Product Assortment: Our merchandise strategy is designed to serve a variety of purchasing occasions, from big-ticket items to replenishment activity, as well as to meet the wide-ranging needs of customers from first-time participants to seasoned outdoor veterans. We pride ourselves on carrying an extensive selection of branded, good, better and best hard goods at everyday low prices, including a broad array of in-stock consumable items. Approximately 34.8% of our unit sales and 20.0% of our dollar sales during fiscal year 2013 were consumable goods, such as ammunition, bait, cleaning supplies, food, lures, propane and reloading supplies. We believe this pairing of product breadth and consumable goods appeals to a broad range of customers and drives both repeat traffic and increased average ticket value. Strong Vendor Relationships: We believe our vendors find our brand-centric, high-service store concept to be unique among national specialty outdoor retailers. Our attractive store locations, consistent presentation of merchandise and thorough product training present a compelling opportunity for our vendors to offer their brands to local markets that historically have been served primarily by mom & pop retailers. As a result, we believe we are able to negotiate terms with our vendors that are similar to those offered to our principal competitors that are larger in size. We share the benefits of these strategic vendor relationships with our customers through better pricing and enhanced access to certain products that are limited in production. Flexible and Adaptable Real Estate Strategy. We believe that our store model, combined with our rigorous site selection process, is uniquely customizable to address the needs of the different markets we serve. Our stores can vary in size from 30,000 to 65,000 gross square feet. We have had success with leasing existing sites as well as constructing new build-to-suit sites. Our flexible store model permits us to serve both large metropolitan areas, Table of Contents Table of Contents like Phoenix, Arizona, and smaller MSAs, like Soldotna, Alaska, while generating consistent four-wall Adjusted EBITDA margins and returns on invested capital across a range of store sales volumes. In small- to medium-sized markets, we are often able to establish ourselves as a standalone destination for our customers; in larger markets, we have successfully leveraged existing infrastructure to open stores in shopping plazas near complementary retailers, drawing upon existing foot traffic. We believe our low-cost, flexible model allows us to access both large and small markets more economically than many of our peers. We maintain a disciplined approach to new store development and perform comprehensive market research before selecting a new site, including partnering with specialized, third-party local real estate firms. We select sites based on criteria such as local demographics, traffic patterns, density of hunting and fishing license holders in the area, abundance of hunting and fishing game and outdoor recreation activities, store visibility and accessibility, purchase data from our existing customer database and availability of attractive lease terms. We have established productive relationships with well-regarded commercial real estate firms and believe that we are a sought-after tenant, given the strength of the Sportsman s Warehouse brand, the high volume of customers that visit our stores and our flexible approach to site locations. As a result, we continue to have access to desirable retail sites on attractive terms. Low Cost Operating Structure with Attractive and Replicable Store Economics. We strive to maintain a lower operating cost structure than our principal competitors, which allows us to serve small- to medium-sized markets as well as larger MSAs. We achieve this by exercising tight control over store-level expenses, real estate costs and corporate overhead. In addition, our growing store base, efficient, localized marketing spend and no frills warehouse store layout help us maintain comparatively low operating costs and provide us with the opportunity to achieve four-wall Adjusted EBITDA margins of 10% or more for stores in most new markets. Our typical new store requires an average net investment of approximately $2.0 million, which includes store build-out (net of contributions from landlords) and pre-opening cash expenditures. In addition, we stock each new store with initial inventory at an average cost of approximately $2.4 million. We target a pre-tax return on invested capital within one year after opening of over 50% excluding initial inventory cost (or over 20% including initial inventory cost), although our historical returns have often exceeded these thresholds. For fiscal year 2013, all of our stores that had been open for more than twelve months had Adjusted EBITDA margins of 10% or more. We believe this low-cost, capital-efficient approach also allows us to successfully serve markets that are not well-suited for the more capital-intensive store models of our principal competitors. Approximately 55% of our markets currently lack another nationally recognized outdoor specialty retailer, which we believe is a result of these dynamics. Significant New Store Growth Opportunity within Existing and New Markets. We operate 49 stores across 18 states, primarily in the Western United States and Alaska, with a presence in these markets that is nearly three times that of the next largest outdoor retailer. We believe our leadership position in the Western United States, combined with our existing scalable infrastructure, provides a strong foundation for continued expansion within our core markets. Over the longer term, we believe our distinct retail concept has the potential to expand to more than 300 locations throughout the United States based on research conducted for us by Buxton Company, an independent consumer research and analytics firm. Passionate and Experienced Management Team with Proven Track Record. We are focused on delivering an unsurpassed shopping experience to anyone who enjoys the excitement of the outdoors. This passion and commitment is shared by team members throughout our entire organization, from senior management to the employees in our stores. Our senior management team has an average of 17 years of retail experience, with extensive capabilities across a broad range of disciplines, including merchandising, real estate, finance, compliance, store operations, supply chain management and information technology. We also pride ourselves on the long tenure of our more than 160 store managers and corporate employees, who have been with us for an average of over seven years. Table of Contents Table of Contents Our Growth Strategy We are pursuing a number of strategies designed to continue our growth and strong financial performance, including: Expanding Our Store Base. We believe that our compelling new store economics and our track record of opening successful new stores provide a strong foundation for continued growth through new store openings in existing, adjacent and new markets. Over the last three fiscal years, we have opened an average of four stores per year. We have opened two new stores to date in fiscal year 2014 and currently plan to open an additional six new stores in the remainder of fiscal year 2014. For the next several years thereafter, we intend to grow our store base at a rate of eight to thirteen stores annually and expect that most of our near-term growth will occur within the Western United States. Our longer-term plans include expanding our store base to serve the outdoor needs of enthusiasts in markets across the United States. We believe our existing infrastructure, including distribution, information technology, loss prevention and employee training, is capable of sustaining 100 or more stores without significant additional capital investment. Increasing Same Store Sales Growth. We are committed to increasing same store sales through a number of ongoing and new initiatives, including: expansion of our clothing offerings and private label program (such as our new proprietary Rustic RidgeTM clothing line), our loyalty program, the implementation of kiosks and mobile point-of-sale in our stores and expansion of our store-within-a-store programs with major brands such as Carhartt, Columbia Sportswear and Under Armour. Each of these initiatives is designed to foster additional shopping convenience, add deeper merchandise selection and provide more product information to the customer. We believe these initiatives will drive additional traffic, improve conversion and increase average ticket value. Continuing to Enhance Our Operating Margins. We believe that our planned expansion of our store base and growth in same store sales will result in improved Adjusted EBITDA margins as we take advantage of economies of scale in product sourcing and leverage our existing infrastructure, supply chain, corporate overhead and other fixed costs. Furthermore, we expect to increase our gross profit margin by expanding product offerings in our private label program, including our new proprietary Rustic RidgeTM clothing line, and continuing marketing initiatives in our higher-margin clothing and footwear departments. Growing the Sportsman s Warehouse Brand. We are committed to supporting our stores, product offerings and brand through a variety of marketing programs, private label offerings and corporate partnerships. Our marketing and promotional strategy includes coordinated print, digital and social media platforms. In-store, we offer a wide range of outdoor-themed activities and seminars, from turkey frying to firearm operation and safety. In addition, we sponsor community outreach and charity programs to more broadly connect with our local communities with the aim of promoting our brand and educating consumers. Finally, we are committed to local chapters of national, regional and local wildlife federations and other outdoor-focused organizations, such as Ducks Unlimited and the Rocky Mountain Elk Foundation. Many of our store managers and employees serve in senior positions in these organizations, which further strengthens our place as leaders in the local outdoor community. We believe all of these programs promote our mission of engaging with our customers and serving outdoor enthusiasts. Risks Related to Our Business Our business is subject to numerous risks and uncertainties, including those discussed in the section entitled Risk Factors beginning on page 14 of this prospectus. These risks include, but are not limited to, the following: our retail-based business model is impacted by general economic conditions, and economic and financial uncertainties may cause a decline in consumer spending; Table of Contents TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights selected information appearing elsewhere in this prospectus and is qualified in its entirety by the more detailed information and financial statements included elsewhere in this prospectus. This summary may not contain all the information you should consider before investing in our common stock. You should carefully read this prospectus in its entirety before investing in our common stock, including the sections titled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and related notes included elsewhere in this prospectus. Unless the context otherwise requires, we use the terms "TrueCar," the "Company," "we," "us" and "our" in this prospectus to refer to TrueCar, Inc. and, where appropriate, our consolidated subsidiaries. Overview Our mission is to transform the car-buying experience for consumers and the way that dealers attract customers and sell cars. We have established an intelligent, data-driven online platform operating on a common technology infrastructure, powered by proprietary data and analytics. We operate our company-branded platform on the TrueCar website and our branded mobile experience. In addition, we customize and operate our platform for affinity group marketing partners, such as USAA and Consumer Reports, financial institutions, and other large enterprises such as Boeing and Verizon. We enable users to obtain market-based pricing data on new and used cars, and to connect with our network of TrueCar Certified Dealers. We benefit consumers by providing information related to what others have paid for a make and model of car in their area and, where available, estimated prices for that make and model of car, which we refer to as upfront pricing information, from our network of TrueCar Certified Dealers. This upfront pricing information generally includes guaranteed savings off MSRP which the consumer may then take to the dealer in the form of a Guaranteed Savings Certificate and apply toward the purchase of the specified make and model of car. We benefit our network of TrueCar Certified Dealers by enabling them to attract these informed, in-market consumers in a cost-effective, accountable manner, which we believe helps them to sell more cars. We are currently focused primarily on new car transactions. In the future, we intend to introduce additional products and services designed to improve the car-buying and car-ownership experience through TrueCar Labs, an incubator focused on developing innovative solutions for the automotive ecosystem. TrueCar Labs deploys new products and solutions in their earliest phase in order to seek feedback from consumers and dealers, enabling them to shape a better product experience. For example, we are developing TrueTrade to provide users with an estimated daily market value for their existing cars and a guaranteed trade-in price which we plan to launch in 2015. In addition, we are developing TrueLoan and TrueLease to provide users with a more convenient way to finance their cars at TrueCar Certified Dealers. We are also in the process of launching a number of new services for our dealers designed to enable them to make better informed inventory management and pricing decisions and to close transactions more efficiently. Our network of over 9,100 TrueCar Certified Dealers consists primarily of new car franchises, representing all major makes of cars, as well as independent dealers. TrueCar Certified Dealers operate in all 50 states and the District of Columbia. We estimate that users of our platform purchasing cars from TrueCar Certified Dealers accounted for approximately 3.4% of all new car sales in the United States in the second quarter of 2014, excluding fleet car sales, an increase from 2.4% in 2013 and 1.5% in 2012. Since our founding in 2005, TrueCar users have purchased over 1.5 million cars from TrueCar Certified Dealers. We obtain automobile purchase data from a variety of sources and use this data to provide consumers and dealers with highly accurate, geographically specific, real-time pricing information. AMENDMENT NO. 2 TO FORM S-1 REGISTRATION STATEMENT Under The Securities Act of 1933 Table of Contents Our subsidiary, ALG, Inc., provides data and consulting services regarding determination of the residual value of an automobile at given points in time in the future. These residual values are used to underwrite automotive loans and leases to determine payments by consumers. In addition, financial institutions use this information to measure exposure and risk across loan, lease and fleet portfolios. During 2013, we generated revenues of $134.0 million and recorded a net loss of $25.1 million. Of the $134.0 million in revenues, 89% consisted of transaction revenues with the remaining 11% derived primarily from the sale of data and consulting services to the automotive and financial services industries. Revenues from the sale of data and consulting services are derived primarily from the operations of our ALG subsidiary. During the six months ended June 30, 2014, we generated revenues of $94.4 million and recorded a net loss of $25.0 million. Of the $94.4 million in revenues, 91% consisted of transaction revenues with the remaining 9% derived primarily from the sale of data and consulting services to the automotive and financial services industries. Transaction revenues primarily consist of fees paid to us by our network of TrueCar Certified Dealers under our pay-for-performance business model where we generally earn a fee only when a TrueCar user purchases a car from them. Industry Overview and Market Opportunity The automotive sector is one of the largest segments of the U.S. economy. There were 15.5 million new cars sold in the United States in 2013 for a total retail value of nearly $500 billion, based on information published by the Bureau of Economic Analysis, or BEA, and the National Automobile Dealers Association, or NADA. In 2013, the largest automotive dealer group accounted for only 1.9% of new vehicle sales, and the top ten dealer groups accounted in the aggregate for only 8.2% of new vehicle sales, according to Automotive News. Consumers face a number of complex issues when buying a car, including obtaining market pricing information with respect to the car they want to buy and negotiating a transaction. While consumers have a number of available information sources that provide pricing data, these alternatives generally do not have information on what others actually paid for a car. As a result, consumers still lack the market data and upfront pricing information that might shorten the negotiation with the dealer and lead to a successful transaction. Automobile dealers operate in a highly competitive market in which access to consumers and informed vehicle pricing are essential to dealer profitability. Overall dealer profitability is closely tied to the volume of new car sales as those sales can lead to higher-margin offerings for the dealer such as trade-ins, financing, maintenance and service, and accessories. In addition, dealers can earn financial incentives and improved vehicle allocation from manufacturers based on their volume of new car sales. Automobile dealers are increasingly shifting from reliance on their physical location and offline media and turning to the Internet to attract consumers and broaden their reach. However, dealers must pay high marketing costs to attract customers and lack empirical data on pricing at the local level. As a result of these challenges, automobile dealers are looking for ways to attract informed, in-market consumers in a cost-effective and accountable manner and effectively price their vehicle inventory to achieve their sales goals. Our Solution We have established an intelligent, data-driven online platform operating on a common technology infrastructure, powered by proprietary data and analytics. We operate our company-branded platform via the TrueCar website and our branded mobile experience. In addition, we customize and operate our platform for affinity group marketing partners, such as USAA, financial institutions, and other large enterprises such as Boeing and Verizon. We enable users to obtain TRUECAR, INC. (Exact name of registrant as specified in its charter) Table of Contents market-based pricing data on new and used cars, and to connect with our network of TrueCar Certified Dealers. We believe the combination of transparent market data, upfront pricing information and guaranteed savings off MSRP benefits both consumers and dealers, resulting in more transactions by users of our platform. Why consumers choose TrueCar We believe consumers choose TrueCar.com and our affinity group marketing partner websites to simplify the car-buying process and to achieve confidence in the price they receive for a car. Our platform provides the following benefits: Upfront pricing information. We access a broad array of transaction data to provide consumers with relevant pricing information on every major make and model of new car sold in the U.S. We also generally provide consumers with an Estimated TrueCar Dealer Price based on data provided by TrueCar Certified Dealers in their area. Quality of service of our network of TrueCar Certified Dealers. We strive to provide consumers with a superior car-buying experience through our network of TrueCar Certified Dealers. To become a TrueCar Certified Dealer, dealers must agree to adhere to certain conditions, including providing upfront pricing information and guaranteed savings off MSRP, where available. Price Confidence. Our users generally receive up to three Guaranteed Savings Certificates, which provide a guaranteed savings off MSRP on the user's specified make and model of car. Our platform allows the user to compare relevant market data for their specified make and model of car with the guaranteed savings from MSRP identified in these certificates. For the six months ended June 30, 2014, TrueCar users paid, on average, nearly $3,200 less than MSRP. Why dealers use TrueCar We believe dealers use TrueCar to attract informed, in-market consumers in a cost-effective and accountable manner, efficiently price their inventory and, ultimately, sell more cars. Under our pay-for-performance business model, we generally earn a fee only when a consumer purchases a car, providing dealers with an accountable marketing channel. We typically charge TrueCar Certified Dealers $299 upon the sale of a new car to a TrueCar user. In 2013, the overall industry average advertising expense per new car across all forms of media was $616, according to NADA. By helping dealers better target their acquisition efforts to in-market consumers using our platform, we believe that dealers can improve their close rates, which results in other operating cost efficiencies such as savings on selling expenses and inventory carrying costs. Why affinity groups partner with TrueCar For many of our affinity group marketing partners, offering a car-buying service is a valuable benefit for their members, but it is not a service that they can provide easily themselves. Affinity groups partner with TrueCar to extend our platform to their members under their own brands. We generally provide members of these groups with access to the same benefits of the TrueCar website and our branded mobile experience with the added recognition of their affinity membership, and other benefits such as improved financing terms and manufacturer incentives. These affinity group marketing partners include USAA, Consumer Reports, AAA, American Express and PenFed. The future of the TrueCar solution In the future, we intend to introduce additional products and services to improve the car-buying and car-ownership experience through TrueCar Labs, an incubator focused on Delaware (State or other jurisdiction of incorporation or organization) 7379 (Primary Standard Industrial Classification Code Number) 04-3807511 (I.R.S. Employer Identification Number) 120 Broadway, Suite 200 Santa Monica, California 90401 (800) 200-2000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents developing innovative solutions for the automotive ecosystem. TrueCar Labs deploys new products and solutions in their earliest phase in order to seek feedback from consumers and dealers, enabling them to shape a better product experience. For example, TrueCar Labs announced the release of the SellMyCar mobile application to help consumers receive an upfront price on their trade-in. In addition, we are developing TrueLoan and TrueLease to provide users with a more convenient way to finance their cars at TrueCar Certified Dealers. We are also in the process of launching a number of new services for our dealers designed to enable them to make better informed inventory management and pricing decisions and to close transactions more efficiently. We believe that these innovations will offer an improved car-buying experience that will delight consumers and better enable dealers to generate orders from the Internet. Our Strengths We believe that our platform offers a superior car-buying experience for our users and TrueCar Certified Dealers. Our strengths include: Accountable business model operating at scale with powerful network effects We operate a pay-for-performance business model that allows in-market car buyers to interact with our network of TrueCar Certified Dealers. In addition, our platform is adaptable on a state-by-state basis in response to the local regulatory environment. As the number of vehicles purchased by our users from our network of TrueCar Certified Dealers continues to grow, we believe the platform will become increasingly attractive to high-quality automobile dealers. In addition, as more in-market consumers utilize our platform, the incremental search, inventory and purchase information generated will increase the utility of our data and analytics platform for all participants. Nationwide network of TrueCar Certified Dealers representing all major makes sold in the U.S. We have built our network of TrueCar Certified Dealers to provide broad nationwide coverage to our users. Our network of over 9,100 TrueCar Certified Dealers consists primarily of new car franchises, representing all major makes of cars, as well as independent dealers. TrueCar Certified Dealers operate in all 50 states and the District of Columbia. Robust data and proprietary analytics platform Our digital platform is powered by data and proprietary analytics. Our data repository contains a wide variety of information, including vehicle-specific information on automotive transactions, vehicle registration records, consumer buying patterns and behavior, demographic information, and macroeconomic data. Our platform also enables our pay-for-performance business model by identifying sales for which a dealer generally pays us a fee only when a TrueCar user purchases a car or based on other performance-based metrics. Long-term, strategic relationships with affinity groups We have built long-term relationships with our affinity group marketing partners for which we operate automobile buying programs. We also offer car-buying programs as an employee benefit directly to corporate customers and, indirectly, through employee benefit plan administrators. We believe that affinity group members represent an attractive audience for our network of TrueCar Certified Dealers because the affinity group or employment relationship creates a deeper level of engagement between the in-market car buyer and the TrueCar Certified Dealer. Scott Painter Chief Executive Officer 120 Broadway, Suite 200 Santa Monica, California 90401 (800) 200-2000 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents Operations guided by insights derived from quantitative data analysis We access consumer, dealer and third-party data to power our platform. We believe our quantitative analytical capabilities enable us to derive insights into consumers and dealers that help inform several of our key areas of focus. Our business intelligence organization is also responsible for tracking internal performance metrics, gleaning insights, and helping to improve our operations. Visionary management team with extensive automotive expertise Our Founder and Chief Executive Officer, Scott Painter, is a pioneer in the online automotive industry, having founded CarsDirect, one of the industry's first successful online automotive businesses. Scott has dedicated his career in the automotive industry to demonstrating that transparency is a more profitable business model. A team of experienced senior executives, with management backgrounds at automotive manufacturers and retailers, online automotive marketing firms, state dealer associations, Internet companies and financial institutions, augments his leadership. Growth Strategy We are in the early stages of pursuing our mission to transform car-buying for consumers and dealers. Key elements of our growth strategy are: Expand the number of visitors to our platform We intend to grow traffic on the TrueCar website and our branded mobile applications by building our brand through marketing campaigns that emphasize the value of trust and transparency in the car-buying process and the benefits of transacting with TrueCar Certified Dealers. We intend to grow affinity group marketing partner traffic by promoting creative marketing programs, such as subsidizing interest rates on loans, and providing other incentives from third parties that deliver a tangible economic benefit to transacting members, increasing awareness of the car-buying program among the members of our affinity group marketing partners and adding new affinity group marketing partners that bring additional users to our platform. Improve the user experience We seek to increase the number of transactions between users of our platform and TrueCar Certified Dealers through a variety of methods, including consistently evaluating and improving our products to enhance the user experience, engaging users with relevant content about car pricing, available incentives and other benefits, while also expanding and improving the geographic coverage of our network of TrueCar Certified Dealers. Expand monetization opportunities Over time, we intend to increase monetization opportunities by introducing additional products and services to improve the car-buying and car ownership experience as well as working more closely with automobile manufacturers. For example, we are developing TrueTrade to provide consumers with an estimated daily market value for their existing cars and a guaranteed trade-in price. In addition, we are developing TrueLoan and TrueLease to provide users with a more convenient way to finance their cars at TrueCar Certified Dealers. Copies to: David J. Segre Tony Jeffries Damien Weiss Wilson Sonsini Goodrich & Rosati, P.C. 650 Page Mill Road Palo Alto, California 94304 (650) 493-9300 Michael Guthrie Chief Financial Officer Troy Foster Chief Legal and Compliance Officer 120 Broadway, Suite 200 Santa Monica, California 90401 (800) 200-2000 Steven B. Stokdyk Latham & Watkins LLP 355 South Grand Avenue Los Angeles, California 90071-1560 (213) 485-1234 Table of Contents Risks Affecting Our Business Our business is subject to numerous risks and uncertainties, including those highlighted in the section titled "Risk Factors" immediately following this prospectus summary. These risks include, but are not limited to, the following: If key industry participants, including car dealers and auto manufacturers, perceive us in a negative light or our relationships with them suffer harm, our ability to grow and our financial performance may be damaged. Our recent, rapid growth may not be indicative of our future growth and, if we continue to grow rapidly, we may not be able to manage our growth effectively. We may be unable to maintain or grow relationships with information data providers or may experience interruptions in the data feeds they provide, which may limit the information that we are able to provide to our users and dealers as well as the timeliness of such information and may impair our ability to attract or retain consumers and TrueCar Certified Dealers and to timely invoice our dealers. We have operated our business at scale for a limited period of time and we cannot predict whether we will continue to grow. If we are unable to successfully respond to changes in the market, our business could be harmed. We have a history of losses and we may not achieve or maintain profitability in the future. The loss of a significant affinity group marketing partner or a significant reduction in the number of cars purchased from our TrueCar Certified Dealers by members of our affinity group marketing partners would reduce our revenue and harm our operating results. Any adverse change in our relationship with United Services Automobile Association, or USAA, could harm our business. We are subject to a complex framework of federal and state laws and regulations primarily concerning vehicle sales, advertising and brokering, many of which are unsettled, still developing and contradictory, which have in the past, and could in the future, subject us to claims, challenge our business model or otherwise harm our business. We participate in a highly competitive market, and pressure from existing and new companies may adversely affect our business and operating results. If we suffer a significant interruption in our ability to gain access to third-party data, our business and operating results will suffer. The success of our business relies heavily on our marketing and branding efforts, especially with respect to the TrueCar website and our branded mobile applications, as well as those efforts of the affinity group marketing partners whose websites we power, and these efforts may not be successful. We rely in part on Internet search engines to drive traffic to our website, and if we fail to appear prominently in the search results, our traffic would decline and our business would be adversely affected. The failure to maintain our brand would harm our ability to grow unique visitor traffic and to expand our dealer network. Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (do not check if a smaller reporting company) Smaller reporting company Table of Contents Recent Developments Financial Results The following sets forth our financial results for the three and nine months ended September 30, 2014 that we announced on November 5, 2014. We anticipate that we will file our Quarterly Report on Form 10-Q for the three months ended September 30, 2014 on November 13, 2014. Three Months Ended September 30, Nine Months Ended September 30, Consolidated Statements of Operations 2014 2013 2014 2013 (In thousands, except per share amounts) Revenues $ 56,751 $ 37,547 $ 151,178 $ 93,813 Costs and operating expenses: Cost of revenue 4,666 3,652 12,524 11,087 Sales and marketing 36,399 21,878 97,458 51,287 Technology and development 10,906 5,512 26,751 16,934 General and administrative 14,919 7,716 42,873 20,658 Depreciation and amortization 3,388 3,241 9,474 9,175 Total costs and operating expenses 70,278 41,999 189,080 109,141 Loss from operations (13,527 ) (4,452 ) (37,902 ) (15,328 ) Interest income 14 30 41 91 Interest expense (27 ) (58 ) (327 ) (1,809 ) Other income 20 5 30 19 Loss before provision for income taxes (13,520 ) (4,475 ) (38,158 ) (17,027 ) Provision for income taxes (120 ) (136 ) (437 ) (409 ) Net loss $ (13,640 ) $ (4,611 ) $ (38,595 ) $ (17,436 ) Net loss per share: Basic and diluted $ (0.18 ) $ (0.08 ) $ (0.56 ) $ (0.30 ) Weighted average common shares outstanding, basic and diluted 76,880 59,799 68,315 58,096 Other Financial Information: Adjusted EBITDA $ 3,860 $ 2,411 $ 6,628 $ 2,409 Non-GAAP net income (loss) $ 339 $ (994 ) $ (3,569 ) $ (8,893 ) Selected Consolidated Balance Sheet Data At September 30, 2014 (in thousands) Cash and cash equivalents $ 112,999 Working capital 111,974 Property and equipment, net 28,688 Total assets 261,767 Total indebtedness 10,970 Total stockholders' equity 214,677 The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents Key Metrics Three Months Ended September 30, 2014 Nine Months Ended September 30, 2014 Units 171,775 447,282 Franchise Dealer Count 8,149 8,149 Transaction Revenue Per Franchise Dealer $6,567 $18,663 Average Monthly Unique Visitors 4.6 million 4.3 million GAAP Revenues were $56.8 million for the three months ended September 30, 2014, an increase of 51% as compared to $37.5 million for the three months ended September 30, 2013. Revenues were $151.2 million for the nine months ended September 30, 2014, an increase of 61% as compared to $93.8 million for the nine months ended September 30, 2013. The increases in revenues are primarily due to increased transaction volume on our platform which we attribute to an increase in marketing spend and an increase in the number of TrueCar Certified Dealers in our network, platform and product enhancements, and the overall growth in sales of the automotive industry. Net loss was $(13.6) million for the three months ended September 30, 2014 as compared to net loss of $(4.6) million for the three months ended September 30, 2013. Net loss was $(38.6) million for the nine months ended September 30, 2014 as compared to net loss of $(17.4) million for the nine months ended September 30, 2013. The increases in the net losses as compared to the corresponding periods in 2013 are primarily due to increased expenses related to an increase in the number of and the grant date fair value of equity based awards. Non-GAAP Adjusted EBITDA and Non-GAAP net (loss) income are not measures of our financial performance calculated in accordance with generally accepted accounting principles in the United States, or GAAP, and neither should be considered as an alternative to net (loss) income, operating (loss) income or any other measures derived in accordance with GAAP. See "Non-GAAP Financial Measures" for a description of Adjusted EBITDA and Non-GAAP net (loss) income, how we use them and their limitations. Adjusted EBITDA was $3.9 million for the three months ended September 30, 2014, an increase of 60% as compared to $2.4 million for the three months ended September 30, 2013. Adjusted EBITDA was $6.6 million for the nine months ended September 30, 2014, an increase of 175% as compared to $2.4 million for the nine months ended September 30, 2013. The increases in Adjusted EBITDA are primarily due to increased revenues as well as improved non-GAAP operating margins. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion: Dated November 10, 2014 6,402,601 Shares Common Stock TrueCar, Inc. is offering 1,000,000 shares to be sold in this offering. The selling stockholders identified in this prospectus are offering an additional 5,402,601 shares. TrueCar will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders. Our common stock is listed on The NASDAQ Global Select Market under the symbol "TRUE". On November 7, 2014, the last reported sale price of our common stock on The NASDAQ Global Select Market was $16.42 per share. We are an "emerging growth company" under the federal securities laws and are therefore subject to reduced public company reporting requirements. Investing in our common stock involves risks. See "Risk Factors" beginning on page 19 to read about factors you should consider before buying shares of our common stock. (1)The excluded amounts relate to legal costs incurred in connection with a claim we filed against Sonic Automotive Holdings, Inc. for trademark infringement and related matters. We have not historically excluded these costs from Adjusted EBITDA; however, as we have incurred increasing costs to advance our claim, we believe that their exclusion is appropriate to facilitate period-to-period operating performance comparisons. We have provided the results described above primarily because our financial closing procedures and related review for the three and nine months ended September 30, 2014 are not Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Table of Contents yet complete. As a result, there is a possibility that our final results will vary from the results described above. Corporate Information Our principal executive offices are located at 120 Broadway, Suite 200, Santa Monica, California 90401, and our telephone number is (800) 200-2000. Our websites are www.TrueCar.com and www.True.com. Information contained on, or that can be accessed through, our websites is not incorporated by reference into this prospectus, and you should not consider information on our websites to be part of this prospectus. We originally incorporated under the name "Zag.com Inc." in Delaware in February 2005. We later changed our name to TrueCar, Inc. TrueCar, the TrueCar logo and other trademarks or service marks of TrueCar appearing in this prospectus are the property of TrueCar. Trade names, trademarks and service marks of other companies appearing in this prospectus are the property of their respective holders. We have omitted the and designations, as applicable, for the trademarks used in this prospectus. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (JOBS Act) and are therefore subject to reduced public company reporting requirements. We will remain an emerging growth company until the earliest to occur of: the last day of the fiscal year in which we have more than $1.0 billion in annual revenue; the date we qualify as a "large accelerated filer," with at least $700 million of equity securities held by non-affiliates; the issuance, in any three-year period, by us of more than $1.0 billion in non-convertible debt securities; and the last day of the fiscal year ending after the fifth anniversary of our initial public offering. Per Share Total Public offering price $ $ Underwriting discounts(1) $ $ Proceeds, before expenses, to TrueCar $ $ Proceeds, before expenses, to the selling stockholders $ $ Table of Contents THE OFFERING Common stock offered by us 1,000,000 shares Common stock offered by the selling stockholders 5,402,601 shares Common stock to be outstanding after this offering 77,814,334 shares (78,774,724 shares if the underwriters exercise their option to purchase additional shares in full) Option to purchase additional shares from us 960,390 shares Use of proceeds We intend to use the net proceeds from this offering primarily for general corporate purposes, including working capital, operating expenses and capital expenditures. We may also use a portion of the net proceeds to acquire or invest in complementary technologies, solutions, products, services, businesses or other assets, although we have no present commitments or agreements to enter into any acquisitions or investments. See "Use of Proceeds." Concentration of ownership Upon completion of this offering, the executive officers, directors and 5% stockholders of our company and their affiliates will beneficially own, in the aggregate, approximately 66.4% of our outstanding capital stock. NASDAQ trading symbol "TRUE" Scott Painter, our Founder and Chief Executive Officer, has indicated an interest in purchasing up to an aggregate of approximately $500,000 of TrueCar's common stock in this offering at the public offering price. Because this indication of interest is not a binding agreement or commitment to purchase, Mr. Painter may elect not to purchase shares in this offering or the underwriters may elect not to sell any shares in this offering to Mr. Painter. The underwriters will receive the same discount from any shares of our common stock purchased by Mr. Painter as they will from any other shares of our common stock sold to the public in this offering. The number of shares of our common stock to be outstanding after this offering is based on 76,814,334 shares of our common stock outstanding at June 30, 2014, and excludes: 26,664,790 shares of common stock issuable upon the exercise of options outstanding at June 30, 2014, with a weighted average exercise price of $9.40 per share; 713,539 shares of common stock subject to restricted stock units ("RSUs") outstanding at June 30, 2014; 1,273,640 shares of common stock reserved for future issuance under our 2014 Equity Incentive Plan (the "2014 Plan"); any shares of common stock that become available subsequent to this offering under our 2014 Plan as a result of the expiration, termination without exercise or forfeiture or repurchase of awards granted under our Amended and Restated 2005 Stock Plan (the "2005 Stock Plan") or our 2008 Stock Plan (the "2008 Stock Plan"), as more fully described in "Executive Compensation Employee Benefits and Stock Plans"; any shares that become available under our 2014 Plan, pursuant to provisions thereof that automatically increase the share reserves under the plan each year, as more fully described in "Executive Compensation Employee Benefits and Stock Plans"; and (1)See "Underwriting" for a description of the compensation payable to the underwriters. Table of Contents 3,981,198 shares of common stock issuable upon the exercise of warrants outstanding at June 30, 2014, with a weighted average exercise price of $10.73 per share. Unless otherwise noted, the information in this prospectus reflects and assumes the following: no purchase by our executive officers, directors or 5% stockholders of any shares to be sold in this offering; no exercise of outstanding options; no exercise of outstanding warrants; and no exercise by the underwriters of their option to purchase up to an additional shares of common stock from us in this offering. To the extent that the underwriters sell more than 6,402,601 shares of common stock, the underwriters have the option to purchase up to an additional 960,390 shares from us at the public offering price less the underwriting discount. Scott Painter, our Founder and Chief Executive Officer, has indicated an interest in purchasing up to an aggregate of approximately $500,000 of TrueCar's common stock in this offering at the public offering price. Because this indication of interest is not a binding agreement or commitment to purchase, Mr. Painter may elect not to purchase shares in this offering or the underwriters may elect not to sell any shares in this offering to Mr. Painter. The underwriters will receive the same discount from any shares of our common stock purchased by Mr. Painter as they will from any other shares of our common stock sold to the public in this offering. Table of Contents
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. Before you decide to invest in our common stock, you should read the entire prospectus carefully, including the section entitled Risk Factors and the consolidated financial statements and related notes included elsewhere in this prospectus. In this prospectus, unless otherwise stated or the context otherwise indicates, references to Trupanion, we, us, our and similar references refer to Trupanion, Inc. and its subsidiaries taken as a whole. Our Company We are a direct-to-consumer monthly subscription service providing a medical insurance plan for cats and dogs throughout the United States, Canada and Puerto Rico. Our data-driven, vertically-integrated approach enables us to provide pet owners with what we believe is the highest value medical plan for their pets, priced specifically for each pet s unique characteristics. Our growing and loyal member base provides us with highly predictable and recurring revenue. We operate our business with a focus on maximizing the lifetime value of each pet while sustaining a favorable ratio of lifetime value relative to acquisition cost. Our target market is large and underpenetrated. We have pioneered a unique solution that sits at the center of the pet medical ecosystem, meeting the needs of pets, pet owners and veterinarians, and we believe we are uniquely positioned to disrupt the pet medical insurance market and drive increased market penetration. The number of pets enrolled in our medical plan has increased every quarter for the last ten years. More recently, our total enrolled pets grew from 31,207 on January 1, 2010 to 181,634 on March 31, 2014, which represents a compound annual growth rate of 51.4%. We generate revenue primarily from subscription fees for our medical plan. Our medical plan automatically renews on a monthly basis, and members pay the subscription fee at the beginning of each subscription period. Our vertically integrated infrastructure eliminates significant frictional costs that constrain many of our competitors, which allows us to provide superior value to our members. For example, while many traditional providers spend approximately $0.45 to $0.64 per dollar of premium on claims, we spent $0.67, $0.68, $0.70 and $0.70 per subscription dollar in 2011, 2012, 2013 and the first quarter of 2014, respectively. Since 2010, at least 88% of our subscription business revenue every quarter has come from existing members who had active subscriptions at the beginning of the quarter. Due to our focus on providing a superior value proposition and member experience, our members are very loyal, as evidenced by our 98.5% average monthly retention rate over 2011, 2012 and 2013. This loyalty is also reflected in our retention of annual cohorts of members, both on an average monthly and cumulative basis. For example, the pets that we enrolled in our medical plan in 2010 had average monthly retention rates of 98.15%, 98.85% and 99.07% at the end of 2011, 2012 and 2013, respectively, which resulted in a cumulative impact of 56% of the original cohort pets remaining enrolled at December 31, 2013. For more information regarding average monthly retention, including an explanation of how we calculate that metric, see Management s Discussion and Analysis of Financial Condition and Results of Operations Key Financial and Operating Metrics. We generate leads through both third-party referrals and online member acquisition channels, which we then convert into members through our website and contact center. Our website, Trupanion.com, is critical to converting leads from all of our member acquisition channels, with over 85% of our new members in the three months ended March 31, 2014 visiting our website prior to or during the enrollment process. Veterinary practices represent our largest referral source. While these referrals accounted for a majority of our enrollments in 2013 and the first quarter of 2014, we do not pay commissions to or otherwise compensate veterinarians for their referrals. We engage a national referral network of independent contractors who are paid fees based on activity in their regions, which we refer to as our Territory Partners. Our Territory Partners are dedicated to cultivating direct veterinary relationships and building awareness of the benefits that our medical plan offers veterinarians Table of Contents The information contained in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JULY 7, 2014 PRELIMINARY PROSPECTUS 7,125,000 Shares Common Stock We are offering 7,125,000 shares of our common stock. This is our initial public offering and no public market currently exists for our common stock. We expect the initial public offering price to be between $13.00 and $15.00 per share. Our common stock has been authorized for listing on the New York Stock Exchange under the symbol TRUP. Investing in our common stock involves a high degree of risk. Please read Risk Factors beginning on page 14 of this prospectus. We are an emerging growth company as defined in The Jumpstart Our Business Startups Act of 2012, and will be subject to reduced public company reporting requirements. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PER SHARE TOTAL Public Offering Price $ $ Underwriting Discounts and Commissions(1) $ $ Proceeds to Trupanion, Inc. Before Expenses $ $ (1) See Underwriting for additional information regarding underwriter compensation. Delivery of the shares of common stock is expected to be made on or about , 2014. We have granted the underwriters an option for a period of 30 days to purchase an additional 1,068,750 shares of our common stock. RBC Capital Markets Barclays Stifel Canaccord Genuity Cowen and Company Prospectus dated , 2014 Table of Contents and their clients. Veterinarians then educate pet owners, who visit our website or call our contact center to learn more about, and potentially enroll in, our medical plan. Our online member acquisition channels serve as important resources for pet owner education and drive new member leads and conversion. We also receive a significant number of new leads from existing members adding pets and referring their friends and family members. As a result of the predictable nature of our subscription business, our business model yields attractive per unit economics. Pets that enrolled in the first quarter of 2014 cost us an average of $111 to acquire and have an implied lifetime value of $610. This represents a 5.5x ratio of lifetime value of a pet divided by average pet acquisition cost. We continually refine our sales and marketing strategies to optimize this ratio. For more information about our key financial metrics, including related risks and assumptions, see Management s Discussion and Analysis of Financial Condition and Results of Operations Key Financial and Operating Metrics. We enrolled our first pet in Canada in 2000 and our first pet in the United States in 2008. Our revenue increased from $19.1 million for the year ended December 31, 2010 to $83.8 million for the year ended December 31, 2013, representing a compound annual growth rate of 64%. Additionally, our revenue increased from $17.8 million for the three months ended March 31, 2013 to $25.6 million for the three months ended March 31, 2014, representing 44% year-over-year growth. We have achieved sequential revenue growth in every quarter since the first quarter of 2010. We have made and expect to continue to make substantial investments in member acquisition and in expanding our operations to support our expected growth. For the years ended December 31, 2011, 2012 and 2013, we had a net loss of $3.9 million, $6.4 million and $8.2 million, respectively. For the three months ended March 31, 2013 and 2014, we had a net loss of $1.9 million and $4.9 million, respectively. As of March 31, 2014, our accumulated deficit was $40.9 million. Industry Overview The role pets play in their owners lives is constantly evolving, with each generation allowing pets to play a more prominent role in family life. Over the course of the last two generations, pets have transitioned from the backyard, to the kitchen, and into the bedroom. Innovations in pharmaceutical technologies, including flea and tick medications, have been important factors enabling increased physical proximity and emotional attachment between pet owners and pets. According to a 2012 survey conducted by Harris Interactive, 91% of U.S. pet owners consider their pets to be family members.(1) Additionally, 81% of U.S. pet owners consider their pets as equal members of the family and 58% think of their pets as their children and refer to themselves as their pets mom or dad, according to a 2011 survey conducted by Kelton Research LLC.(2) As further evidence of this growing human-animal bond, 77% of cat owners and 66% of dog owners said they let their cats or dogs sleep in their beds, according to a 2012 survey conducted by Harris Interactive.(1) A growing number of pet owners pamper their cats and dogs, and spend significant amounts on relatively expensive products and services for their pets, such as premium organic food and doggy day care. According to the American Pet Products Association (APPA), U.S. consumers are expected to spend $58.5 billion on their pets in 2014, representing an increase of approximately 52% from the $38.5 billion spent in 2006.(3) Despite this increased focus on pet care, pet owners are often surprised by the cost of veterinary care and can be financially unprepared if their beloved pets become injured or ill. The costs of medical treatments for pets have become more onerous over time due to the availability and usage of increasingly advanced veterinary care. Although traditional pet insurance products have been offered for years, many of these products are poorly designed and confusing to pet owners and their veterinarians. Because these products provide limited value to both pet owners and veterinarians, they have low adoption rates. Consequently, pet owners without medical (1) See note 1 in the section entitled Market and Industry Data. (2) See note 2 in the section entitled Market and Industry Data. (3) See note 3 in the section entitled Market and Industry Data. Table of Contents Table of Contents coverage or with traditional insurance products may be forced to accept sub-standard care for their pets due to financial constraints. While both pet owners and veterinarians share the common goal of ensuring the best possible care for pets, they face several challenges. Problems facing pet owners: Cost of medical care is becoming increasingly burdensome on pet owners Pet owners are often surprised by and unprepared for the costs of veterinary care Traditional pet insurance products provide poor value and customer experiences Problems facing veterinarians: Veterinarians are constrained by pet owners inability to pay for optimal care Veterinary practices face challenging business economics Traditional pet insurance products have created conflicts between veterinarians and pet owners Our Market Opportunity We believe the growing human-animal bond has led to an increasing willingness by pet owners to spend on pet health. According to the APPA, of the $58.5 billion that is expected to be spent on pets in 2014, U.S. consumers are expected to spend $15.3 billion on veterinary care in 2014, representing an increase of 66% from the $9.2 billion spent in 2006.(4) Veterinary expenditures are rising due to technological advancements in veterinary medicine and increased utilization of care. More sophisticated and costly treatments, such as ultrasound, radiation therapy, MRIs, CT scans, transplants and chemotherapy, are gaining wider acceptance. The cost of diagnostic testing alone can be expensive, in part because pets are unable to communicate their symptoms. For example, even a seemingly minor issue can potentially cost thousands of dollars to diagnose and treat since the pet cannot communicate symptoms. We believe the addressable market for medical coverage for cats and dogs in North America is the largest in the world. Pet owners in the United States and Canada collectively owned approximately 193 million cats and dogs according to surveys conducted by the APPA in 2013 and the Canadian Animal Health Institute in 2012.(5) By comparison, pet owners in Europe collectively owned approximately 165 million cats and dogs in 2012, according to the European Pet Food Industry Federation.(6) Despite the growing human-animal bond, approximately 1% of pet owners in the United States and Canada had pet medical coverage in 2013, according to a 2013 report from Packaged Facts, a division of Market Research Group, LLC.(7) Many European countries have significantly higher penetration rates of pet medical coverage, which range from 5% in France and Denmark to 25% in the United Kingdom and 40% in Sweden, according to a 2013 study conducted by Munich Re.(8) We believe that these higher penetration rates stem from active collaboration between pet medical coverage providers and veterinary communities to design and deliver high value medical coverage. (4) See notes 3 and 4 in the section entitled Market and Industry Data. (5) See notes 5 and 6 in the section entitled Market and Industry Data. (6) See note 7 in the section entitled Market and Industry Data. (7) See note 8 in the section entitled Market and Industry Data. (8) See note 9 in the section entitled Market and Industry Data. Table of Contents Table of Contents Our Solution To address these challenges, we offer a simple, fair and comprehensive plan that pays 90% of actual veterinary costs for covered accident and illness claims, has no payout limitations and can be used to cover the costs incurred at any veterinary practice, emergency care center or specialty hospital in the United States, Canada and Puerto Rico. Generally, the only costs not covered by our plan are those relating to conditions existing prior to the pet s enrollment, routine or preventative care, including examination fees, and taxes. This differentiated approach aligns the interests of pet owners and veterinarians, which allows them to focus on providing the best care for pets rather than minimizing the cost of treatment. Benefits to Pet Owners We believe our solution offers the following key benefits to pet owners: Predictability of costs and peace of mind. Our members can be confident that their pets will be covered in the event of injury or illness. Awareness of cost of care. We actively market the value of our plan to veterinarians, enabling them to educate pet owners effectively about the costs of veterinary care and the benefits of our medical plan. Superior value proposition. We offer a comprehensive medical plan with no limitations for chronic, congenital or hereditary conditions, no payout limits and no mandates to veterinarians on the cost of treatment. Exceptional member experience. We have designed our claims process to be fair, efficient and transparent. Our goal is to help eliminate the high levels of frustration associated with traditional pet insurance products. Benefits to Veterinarians We believe our solution offers the following key benefits to veterinarians: Freedom to be the most effective advocate for pets. Our plan does not limit how much can be paid for an injury or illness. This provides veterinarians with the freedom to practice veterinary medicine at the highest level and be the most effective advocate for the health of the pets. More loyal client base. Our members visit veterinarians more frequently, which can generate significantly more annual revenue for veterinarians compared to clients without pet medical coverage. The result is a client base that is more engaged, spends more money on care and has healthier cats and dogs. Reduces potential conflicts with cost-sensitive pet owners. We enable veterinarians to recommend optimal treatment without having their decisions dictated by the cost of treatment and the financial burden on the pet owner. As a result, veterinarians are able to establish stronger ties with their clients. Our Strengths We have the following strengths, which we believe are competitive advantages and not easily replicated: Compelling value proposition drives a powerful network effect. Our differentiated solution aligns the interests of both pet owners and veterinarians, creating a unique network effect. Our members benefit because their pets receive the best care possible and we pay 90% of the covered costs. Veterinarians benefit because they can recommend the optimal treatment and provide a high standard of care regardless of cost, which improves their business fundamentals. As more pet owners and veterinarians experience the compelling benefits of our medical plan, we believe they act as ambassadors for our brand and drive additional enrollments. Table of Contents Table of Contents Unique go-to-market strategy enables cost-efficient member acquisition. We invest significantly in developing relationships with veterinarians because we believe they are uniquely positioned to introduce our value proposition to pet owners. Since 2003, we have been building a national independent referral network, comprised of 62 Territory Partners as of March 31, 2014, dedicated to cultivating direct veterinary relationships and building awareness of the benefits that our medical plan offers both veterinarians and their clients. For the three months ended December 31, 2013, we received referrals from over 5,000 veterinary practices. Vertically integrated approach reduces frictional costs and improves member value. We manage all aspects of our business using a vertically integrated approach that eliminates many of the significant frictional costs and member experience complications that can result from outsourcing key business functions to third-party service providers. We have strategically chosen to share these cost savings with our members in the form of higher claims payout ratios relative to traditional providers, which has enabled us to provide a superior value proposition. Actionable data insights. Over the past 14 years, we have collected an extensive library of proprietary data that is not commercially available and that we believe is unparalleled in the industry. As of March 31, 2014, we had collected data from over 5,500,000 medical plan months, 750,000 claims, 18,000 veterinary practices, 60,000 postal codes and 440 cat and dog breeds. Using these insights, we are able to accurately price subscriptions to our medical plan, increase our retention rate and optimize lifetime value of a pet. Powerful technology infrastructure. We have developed proprietary software systems that form the backbone of our technology platform, including our data analytics and pricing engine, claims processing software, customer relationship management system, contact center phone system and website. These solutions were custom built to meet the unique needs of our business and enable us to achieve superior operational execution. Proven management team. We have a management team of experienced professionals with deep industry knowledge, a strong track record of successful execution and an average of ten years of experience in the veterinary medicine and insurance industries. We believe that our management team is uniquely positioned to lead a company that operates at the intersection of three highly complex fields: veterinary medicine, data analytics and technology. Our Strategy Our strategy is focused on attracting and retaining members by providing a best-in-class value and member experience. We are focused on building a successful long-term business by pursuing the following growth strategies: Increase the number of referring veterinary practices. We intend to increase the number of veterinary practices that are actively introducing our medical plan to their clients by continuing to expand our national independent referral network of Territory Partners and increasing direct marketing to veterinarians. Increase the number of referrals from active veterinary practices. We intend to continue increasing the number and quality of interactions that we have with veterinarians to accelerate the rate at which active veterinary practices refer us leads. Increase the number of third-party referrals from members. We are focused on using innovative technologies to further enhance our member experience. Generally, we believe a superior member experience will foster member-to-pet owner referrals. For example, we recently introduced a new technology, Trupanion Express, which is designed to facilitate the direct payment of claims to veterinary practices. Improve online lead generation and conversion. We are investing in our online marketing capabilities, and intend to continue to do so in order to fully capture the online opportunity. Table of Contents TABLE OF CONTENTS PROSPECTUS SUMMARY 1
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+Prospectus Summary 1
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+This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider before deciding to invest in our common stock. Before investing in our common stock, you should carefully read this entire prospectus, including our Consolidated Financial Statements and the related notes thereto and the information set forth under the sections Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations, in each case included in this prospectus. Unless the context otherwise requires, we use in this prospectus the term ING U.S., Inc. to refer to ING U.S., Inc., and we use the terms Company, we, us and our to refer to ING U.S., Inc. together with its consolidated subsidiaries. Our Company We are a premier retirement, investment and insurance company serving the financial needs of approximately 13 million individual and institutional customers in the United States as of December 31, 2013. Our vision is to be America s Retirement Company . Our approximately 7,000 employees (as of December 31, 2013) are focused on executing our mission to make a secure financial future possible one person, one family and one institution at a time. Through our retirement, investment management and insurance businesses, we help our customers save, grow, protect and enjoy their wealth to and through retirement. We offer our products and services through a broad group of financial intermediaries, independent producers, affiliated advisors and dedicated sales specialists throughout the United States. Our extensive scale and breadth of product offerings are designed to help Americans achieve their retirement savings, investment income and protection goals. Our strategy is centered on preparing customers for Retirement Readiness being emotionally and economically secure and ready for their retirement. We believe that the rapid aging of the U.S. population, weakening of traditional social safety nets, shifting of responsibility for retirement planning from institutions to individuals and growth in total retirement account assets will drive significant demand for our products and services going forward. We believe that we are well positioned to deliver on this Retirement Readiness need. We believe that we help our customers achieve four essential financial goals, as they prepare for, enter and enjoy their retirement years. Save. Our products enable our customers to save for retirement by establishing investment accounts through their employers or individually. Grow. We provide advisory programs, Individual Retirement Accounts ( IRAs ), fixed annuities, brokerage accounts, mutual funds and accumulation insurance products to help our customers achieve their financial objectives. Protect. Our specialized retirement and insurance products, such as universal life ( UL ), indexed universal life ( IUL ), term life and stable value products, allow our customers to protect against unforeseen life events and mitigate market risk. Enjoy. Our income products such as target date funds, guaranteed income funds, fixed annuities, IRAs, mutual funds and accumulation insurance products enable our customers to meet income needs through retirement and achieve wealth transfer objectives. We tailor our products to meet the unique needs of our individual and institutional customers. Our individual businesses are primarily focused on the middle and mass affluent markets; however we serve customers across the full income spectrum, especially in our Institutional Retirement Plans business, Retail and Alternative Fund businesses, and Employee Benefits segment. Similarly, our institutional businesses serve a broad range of customers, with customized offerings to the small-mid, large and mega market segments. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We and the Selling Stockholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any jurisdiction where such offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MARCH 18, 2014 Preliminary Prospectus 26,500,000 Shares Common Stock ING Groep N.V. ( ING Group or the Selling Stockholder ) is offering 26,500,000 shares of the common stock of ING U.S., Inc. ING U.S., Inc. will not receive any of the proceeds from the sale of the shares sold by the Selling Stockholder. Concurrently with the completion of this offering, we expect to repurchase from ING Group an additional number of shares of our common stock having an aggregate repurchase price of $250 million, at a price per share equal to the per share proceeds, before expenses, to the Selling Stockholder, as shown in the table below. See Summary Share Repurchase Program and Direct Share Buyback from ING Group . Our common stock is listed on the New York Stock Exchange ( NYSE ) under the symbol VOYA . We expect to rebrand from ING U.S. to Voya Financial over time, beginning soon after this offering. See Business Our Brand . The last reported sale price of our common stock on the NYSE on March 17, 2014 was $35.60 per share. Investing in our common stock involves risk. See Risk Factors on page 21 to read about factors you should consider before buying shares of our common stock. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to the Selling Stockholder $ $ (1) The underwriters will receive compensation in addition to the underwriting discount. See Underwriting . To the extent that the underwriters sell more than 26,500,000 shares, the underwriters have the option to purchase up to an additional 3,975,000 shares from the Selling Stockholder at the public offering price less the underwriting discount. The underwriters expect to deliver the shares against payment in New York, New York on , 2014. Morgan Stanley Goldman, Sachs & Co. Citigroup BofA Merrill Lynch Prospectus dated , 2014. Table of Contents NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements. Forward-looking statements include statements relating to future developments in our business or expectations for our future financial performance and any statement not involving a historical fact. Forward-looking statements use words such as anticipate, believe, estimate, expect, intend, plan, and other words and terms of similar meaning in connection with a discussion of future operating or financial performance. Actual results, performance or events may differ materially from those projected in any forward-looking statement due to, among other things, (i) general economic conditions, particularly economic conditions in our core markets, (ii) performance of financial markets, including emerging markets, (iii) the frequency and severity of insured loss events, (iv) mortality and morbidity levels, (v) persistency and lapse levels, (vi) interest rates, (vii) currency exchange rates, (viii) general competitive factors, (ix) changes in laws and
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diff --git a/parsed_sections/prospectus_summary/2014/WIX_wix-com_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/WIX_wix-com_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..d1a4c906f05e7389c2ed72a897788cbf959de8fd
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+This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before deciding to invest in our ordinary shares. You should read the entire prospectus carefully, including "Risk Factors" and our consolidated financial statements and notes to those consolidated financial statements, before making an investment decision. In this prospectus, the terms "Wix," "we," "us," "our" and "the company" refer to Wix.com Ltd. and its subsidiaries. Our Vision We believe that the Internet should be accessible to everyone, not just to access information but also to develop, create and contribute. We see many similarities in our vision with the desktop revolution, when computer hardware and software evolved to provide everyone with the capability to develop, create and print professional-quality documents from their desktop. Access expanded to everyone, document creation became a core human skill, and the asset-heavy approach was abandoned. This same revolution has not yet happened online. Today, professional skill and capital is needed to turn ideas into high-quality web content. We believe that by providing an easy-to-use and affordable solution with professional-quality results, we are leading the "Webtop Revolution." Our Business We are a leading global web development platform with one of the largest number of registered users in the world. We empower over 42 million registered users in 190 countries to create and manage a fully integrated and dynamic digital presence. We are pioneering a new approach to web development and management that provides an easy-to-use yet powerful cloud-based platform that eliminates the need for complex coding and supplants expensive design services. Our solutions enable millions of businesses, organizations, professionals and individuals to take their businesses, brands and workflow online. We offer our solutions through a freemium and subscription model, and as of December 31, 2013, we had 789,753 premium subscriptions. Our core product is a drag-and-drop visual development and editing environment complete with high quality templates, graphics, image galleries and fonts. With our platform, Wix users can create and manage a professional-quality digital presence tailored to their brands' specific look and feel, accessible across all major browsers and the most widely used desktop, tablet and mobile devices. Our cloud-based platform is accessed through a hosted environment, allowing our users to update their site and manage their business or organization at any time. We provide our users with flexibility and scalability, allowing them to expand their digital presence as their business, organizational, professional or individual needs change and grow. Through our highly curated App Market, which we launched in the last quarter of 2012, as of December 31, 2013, we offered our users the ability to easily install more than 156 free and purchasable apps that were carefully identified and selected for inclusion in the App Market by us based on user needs and demand. These apps add additional functionality and are easily integrated into users' websites with one click and without any coding. Revenues from our App Market have been negligible to date. Our scale and reach makes us an attractive partner for companies interested in distributing their own solutions to our users, which are primarily small business owners, organizations and entrepreneurs. As we expand our platform through partnerships, we are able to increase our value proposition for existing users and more easily attract new users. Form F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 By developing business intelligence using the data we have generated over several years of operation, we have been able to leverage online channels effectively for the majority of our marketing efforts without the need for a direct sales force. In addition, many of our users refer us within their personal and professional networks. As a result, we generate a large volume of traffic through word-of-mouth, with organic and direct traffic, meaning visitor traffic that reached our website, Wix.com, via unpaid search results or by typing the URL of our website in their browser, accounting for approximately 58% of the premium subscriptions generated by users that registered in the fourth quarter of 2013. We are removing not only technological, but also geographic and linguistic barriers to web development by offering our platform in several languages, including English, French, Spanish, Portuguese, Italian and Russian. Through December 31, 2013, we had achieved 16 consecutive quarters of sequential growth in the number of premium subscriptions. We have also achieved 16 consecutive quarters of growth in revenues and collections. We had revenues of $24.6 million, $43.7 million and $80.5 million and collections of $29.6 million, $52.5 million and $98.7 million in 2011, 2012 and 2013, respectively. We had a net loss of $22.7 million, $15.0 million and $28.7 million in 2011, 2012 and 2013, respectively. Industry Background Increasing need for a dynamic digital presence According to an October 2013 Netcraft survey, there are more than 767 million websites across all domains, nearly four times the number that existed five years ago. The way that consumers interact with websites, however, continues to expand with the evolution of technology. Consumers have come to expect a high level of personalization, engagement and functionality; a static website is no longer satisfactory and can even negatively affect overall brand perception for businesses, organizations and professionals. In the current market, businesses, organizations and professionals need a dynamic digital presence with tools to manage interactions with customers, suppliers, partners and employees online and in real time. These interactions include back-end activities like invoicing, customer relationship management and payment processing, as well as front-end activities such as communications, online marketing, reservations and scheduling and social media integration. Use of dynamic web content and services for high level customer engagement is becoming increasingly prolific. Businesses, organizations and professionals that have access to the latest technology and large budgets are able to create this fully functional, integrated and engaging digital presence and widen the competitive gap between themselves and those that lack access. Creating a dynamic digital presence is challenging Building this presence is becoming more challenging for businesses, organizations, professionals and individuals for the following reasons: Developing a dynamic digital presence with professional quality is expensive. Developing and maintaining a professional-quality digital presence today often requires the engagement of professional designers and developers, which is not an option for many small businesses with limited budgets. Learning to code is difficult, time consuming and out of reach for most. As coding languages continue to evolve over time to allow for additional features and functionality, the complexity and level of skill required to develop a digital presence increases dramatically. As a result, these Wix.com Ltd. (Exact Name of Registrant as Specified in its Charter) professional-quality improvements are generally out of reach for those that have limited or no experience with computer programming. The ability to manage and modify in real time is limited and time consuming. Hiring a third-party to dynamically update a site is costly, impractical and often time consuming even for relatively small changes. Most website template solutions provide options but have limited flexibility in terms of what can be changed once a website is published. Integrating functionality requires advanced skills and access to multiple vendors. Proficiently discovering, managing and integrating multiple applications and tools is complex and typically requires hiring costly developers. There are many platforms, browsers and devices which each have different compatibility requirements. In order to develop a digital presence that is widely accessible across the growing number of platforms, browsers and devices, there is often a need to recreate an entire site multiple times with different specifications. This is costly and time consuming for even the largest companies. Our Solution We offer our web development, design and management solutions and apps through a cloud-based online platform that enables almost 42 million businesses, organizations, professionals and individuals to create a sophisticated and professional digital presence. Our large user base provides our partners with a massive distribution channel for their products, enhancing the value we can provide our users. Benefits to Our Users We believe that our solution offers the following key benefits to our users: Professional quality at an affordable price. We provide customizable and professionally designed content, allowing users to encapsulate their vision consistent with their brand and establish credibility. We have a dedicated team of over 40 design professionals, and users may access our professional content and features at a material discount to the cost of hiring a professional or in many cases at no cost at all. Easy-to-use technology. Our platform provides our users with a powerful and easy-to-use cloud-based solution that takes the technological complexity out of web development and management, allowing anyone to create a dynamic digital presence. Our drag-and-drop editing environment enables users with basic computer skills to create a fully functional digital presence without the need to develop an advanced new skill set. User-driven website management. Our cloud-based platform makes ongoing management simple, enabling users to maintain their dynamic digital presence at any time without the need to pay for expensive design professionals to make even small changes. We also have an in-house team of 152 support and call center professionals available for our users. Access to third-party apps. We offer a selection of over 156 free and paid apps through our highly curated App Market that were carefully identified and selected for inclusion in the App Market by us based on user needs and demand. These apps provide online workflow and management tools that users can add through the Wix Editor. The required coding is managed automatically by our proprietary software without any effort needed by the user, making integration with our users' sites seamless. Multi-platform. Our technology addresses the challenges posed by the wide range of browsers and devices used to access the web. We handle all the code customizations and required site State of Israel (State or Other Jurisdiction of Incorporation or Organization) 7370 (Primary Standard Industrial Classification Code Number) 98-0685109 (I.R.S. Employer Identification No.) Eitan Israeli, Adv. Vice President and General Counsel Wix.com Ltd. 40 Namal Tel Aviv St. Tel Aviv, 6350671 Israel +972 (3) 545-4900 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) compatibility with new device and browser platforms, removing additional cost and effort for our users. Benefits to Our Partners We believe that our solution offers the following key benefits to our partners: Distribution to a large user base. We attract interest from multiple companies seeking to market their solutions effectively to our large and highly engaged audience of businesses, organizations, professionals and individuals through free and paid apps available in our App Market, as well as other offers, features and services. Seamless integration of offered solutions. We help developers get their products discovered and provide easy installation and integration. We also collect and process payments from our users for paid apps, further reducing friction for both our users and our partners. Our Strengths We believe the following key strengths provide us with competitive advantages: Proprietary technology platform. Our core strength is our technology that reduces the challenges and complexities of web development and management for our users. Our environment enables simple drag-and-drop functionality, and our use of HTML5 gives our users the ability to easily incorporate video, audio, fonts, graphics and animations into their site. Our users also benefit from enhanced workflow functionalities through the seamless integration of third-party apps. Large user base and growing global ecosystem. We have over 42 million registered users across 190 countries and offer our platform in several languages, empowering our users to create and manage a digital presence in their own language. As our community grows, we become increasingly valuable as a distribution channel for partners and developers, who in turn expand our offering to our users with additional features and services through the development of apps. Superior design and content. More than 10% of our workforce is comprised of designers. We believe this investment in design provides our users with a superior starting point and allows them to create a visually engaging and professional-quality digital presence. Efficient marketing and customer acquisition. Our marketing activities are based on a constant analysis of behavior response data generated on our platform, enabling us to operate different marketing campaigns efficiently across a variety of advertising channels and without a direct sales force. Embedded solution for our users. As the basis of their online operating platform, Wix becomes a core aspect of our users' businesses. Our solutions are designed to cater to the varying needs of most business categories while supporting users throughout the evolution of their business lifecycle, greatly increasing the likelihood that they remain users. Our Strategy Key elements of our strategy include: Growing our user base. The value of our platform continues to increase as our user base expands. We intend to continue to build our user base in the following ways: Leveraging our data to increase and optimize our paid marketing. We will continue to leverage the intelligence derived from the large quantities of marketing data we have gathered since our launch to optimize our marketing spend. Wix.com, Inc. 2601 Mission Street San Francisco, CA 94110 (415) 643-6479 (Name, address, including zip code, and telephone number, including area code, of agent for service) Growing our brand. We plan to invest in brand marketing initiatives that will further associate Wix as the go-to platform for web development and management, increasing our long-term ability to acquire users. Expanding to underserved geographic markets. We plan to make our solution, support and communication channels available in more languages and expand our billing infrastructure to drive growth in underserved geographic markets. Developing new solutions. We intend to create additional value for our users and increase our platform's monetization in the following ways: Investing in product development to offer additional services. We plan to leverage our experience and knowledge in web development and workflow management to build new solutions, such as apps, data management and mobile solutions that our users need to operate and succeed online. Expanding our partner ecosystem. We will seek to attract more partners that will provide our users with free and paid apps through our App Market as well as other features and services, further enriching our solutions and creating additional monetization opportunities.
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diff --git a/parsed_sections/prospectus_summary/2014/WKHS_workhorse_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/WKHS_workhorse_prospectus_summary.txt
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/WMS_advanced_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/WMS_advanced_prospectus_summary.txt
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+S-1/A 1 d819257ds1a.htm AMENDMENT NO. 1 TO FORM S-1 Amendment No. 1 to Form S-1 Table of Contents As filed with the Securities and Exchange Commission on December 1, 2014 Registration No. 333-200312 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Advanced Drainage Systems, Inc. (Exact name of registrant as specified in its charter) Delaware 3084 51-0105665 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 4640 Trueman Boulevard Hilliard, Ohio 43026 (614) 658-0050 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Joseph A. Chlapaty Chairman, President & Chief Executive Officer 4640 Trueman Boulevard Hilliard, Ohio 43026 (614) 658-0050 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Stephen C. Mahon, Esq. Fredric L. Smith, Esq. Aaron A. Seamon, Esq. Squire Patton Boggs (US) LLP 41 South High Street, Suite 2000 Columbus, Ohio 43215 (614) 365-2700 Kirk A. Davenport II, Esq. Ian D. Schuman, Esq. Latham & Watkins LLP 885 Third Avenue New York, New York 10022 (212) 906-1200 Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered (1) Proposed Maximum Offering Price Per Share (1)(2) Proposed Maximum Aggregate Offering Price (1)(2) Amount of Registration Fee(3) Common Stock, $0.01 par value per share 11,500,000 $23.34 $268,410,000 $31,189.25 (1) Includes shares that may be sold upon exercise by the underwriters of their option to purchase additional shares. (2) This amount represents the proposed maximum aggregate offering price of the securities registered hereunder. Estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rule 457(c) under the Securities Act of 1933, as amended. The price shown is the average of the high and low sale prices for shares of Common Stock of Advanced Drainage Systems, Inc. on November 28, 2014 as reported on the New York Stock Exchange. (3) Of this registration fee, $30,761.63 was previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents items. Additionally, EBITDA and Adjusted EBITDA are not intended to be measures of free cash flow for management s discretionary use, as they do not reflect certain cash requirements such as tax payments, debt service requirements, capital expenditures and certain other cash costs that may recur in the future. EBITDA and Adjusted EBITDA contain certain other limitations, including the failure to reflect our cash expenditures, cash requirements for working capital needs and cash costs to replace assets being depreciated and amortized. In evaluating Adjusted EBITDA, you should be aware that in the future we will incur expenses that are the same as or similar to some of the adjustments in this presentation, such as stock based compensation expense, derivative fair value adjustments, and foreign currency transaction losses. Our presentation of Adjusted EBITDA should not be construed to imply that our future results will be unaffected by any such adjustments. Management compensates for these limitations by relying on our GAAP results in addition to using EBITDA and Adjusted EBITDA supplementally. Our measures of EBITDA and Adjusted EBITDA are not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation. The following table presents a reconciliation of EBITDA and Adjusted EBITDA to Net income, the most comparable GAAP measure, for each of the periods indicated: Fiscal Year Ended March 31, Six Months Ended September 30, (Amounts in thousands) 2012 2013 2014 2013 2014 Net income attributable to ADS $ 43,260 $ 28,159 $ 11,124 $ 33,618 $ 36,631 Depreciation and amortization (a) 59,356 56,926 57,454 28,665 28,758 Interest expense 21,837 16,095 16,141 7,967 8,953 Income tax expense 27,064 16,894 22,575 23,308 23,757 EBITDA 151,517 118,074 107,294 93,558 98,099 Derivative fair value adjustments (b) 2,315 (4 ) (53 ) 238 163 Foreign currency transaction losses (c) 378 1,085 845 (87 ) (75 ) Gain on sale of Septic Chamber business (d) (44,634 ) Unconsolidated affiliates interest and tax (e) 915 729 204 228 413 Management fee to minority interest holder JV (f) 1,098 604 558 Special dividend compensation 22,624 Contingent consideration remeasurement 259 Stock based compensation (g) 1,425 2,592 5,287 1,424 4,416 ESOP deferred stock based compensation (h) 4,957 7,283 7,891 5,026 5,374 Transaction costs (i) 1,560 118 715 Adjusted EBITDA $ 116,873 $ 129,759 $ 147,009 $ 101,109 $ 109,663 (a) Includes our proportionate share of depreciation and amortization expense of $985, $1,321 and $1,556 related to our South American Joint Venture, our BaySaver Joint Venture and our Tigre-ADS USA Joint Venture, which amounts are included in equity in net (income) loss of unconsolidated affiliates in our consolidated statements of income for fiscal years 2012, 2013 and 2014, respectively, and $677 and $1,272 included in equity in net loss of unconsolidated affiliates in our condensed consolidated statements of income for the six months ended September 30, 2013 and 2014, respectively. Depreciation and amortization expense for fiscal year 2012 also includes a charge of $3,200 related to the impairment of one of our trademarks. (b) Represents the non-cash gains and losses arising from changes in mark-to-market values for derivative contracts related to diesel fuel, interest rate and propylene swaps. The impact of resin physical and financial derivatives is included in cost of goods sold. (c) Represents the gains and losses incurred on purchases, sales and intercompany loans and dividends denominated in non-functional currencies. (d) Represents a gain recognized on the sale of our septic chamber business in January 2012. (e) Represents our proportional share of income taxes and interest related to our South American Joint Venture, our BaySaver Joint Venture and our Tigre-ADS USA Joint Venture, which are accounted for under the equity method of accounting. (f) Represents management fee paid to a minority interest holder of a consolidated subsidiary. (g) Represents the non-cash stock based compensation cost related to our stock options and restricted stock awards. (h) Represents the non-cash stock based compensation expense attributable to the shares of convertible preferred stock allocated to employee ESOP accounts during the applicable period. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or jurisdiction where the offer or sale is not permitted. Subject to Completion, dated December 1, 2014 PROSPECTUS 10,000,000 Shares Advanced Drainage Systems, Inc. Common Stock All of the shares of common stock of Advanced Drainage Systems, Inc. being sold in this offering are being sold by the selling stockholder identified in this prospectus. We will not receive any of the proceeds from the sale of shares of common stock by the selling stockholder in this offering. Our common stock is listed on the New York Stock Exchange under the symbol WMS. The last reported sale price of our common stock on November 28, 2014 was $23.51 per share. Investing in our common stock involves risks. See Risk Factors beginning on page 20 of this prospectus. Per Share Total Price to the public $ $ Underwriting discounts and commissions(1) $ $ Proceeds to the selling stockholder (before expenses) $ $ (1) We refer you to Underwriting beginning on page 170 of this prospectus for additional information regarding total underwriter compensation. The underwriters also may purchase up to 1,500,000 additional shares of common stock from the selling stockholder at the public offering price less the underwriting discounts and commissions. We will not receive any of the proceeds from the sale of shares of common stock by the selling stockholder if the underwriters exercise their option to purchase additional shares of common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares of common stock on or about , 2014. Barclays Deutsche Bank Securities RBC Capital Markets BofA Merrill Lynch Baird Fifth Third Securities PNC Capital Markets LLC Prospectus dated , 2014 Table of Contents Table of Contents TABLE OF CONTENTS Page TRADEMARKS ii MARKET AND INDUSTRY DATA ii PRESENTATION OF INFORMATION ii PRESENTATION OF CERTAIN FINANCIAL MEASURES iii PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/W_wayfair_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/W_wayfair_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/ACRV_acrivon_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ACRV_acrivon_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ACRV_acrivon_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/AIMTF_aimfinity_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/AIMTF_aimfinity_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..f80b84de2f780ab71f3247af60161321d658bf5b
--- /dev/null
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that the Company will adopt prior to the consummation of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors and director nominees; EF Hutton are to EF Hutton, division of Benchmark Investments, LLC, a representative of the underwriters in this offering; equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of such securities; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination; initial shareholders are to our sponsor and any other holders of our founder shares immediately prior to this offering; letter agreement refers to the letter agreement with our sponsor, officers and directors, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement shares are the 450,000 Class A ordinary shares (or 492,000 Class A ordinary shares if the underwriters exercise their over-allotment option in full) included within the private placement units being purchased separately by our sponsor in the private placement simultaneously with the closing of this offering; private placement units are to the units issued to our sponsor in a private placement simultaneously with the closing of this offering; private placement warrants are to redeemable warrants to purchase an aggregate of 675,000 of our Class A ordinary shares (or 738,000 shares if the underwriters exercise their over-allotment option in full) included within the private placement units being purchased separately by our sponsor in the private placement; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor, officers, directors and their respective affiliates to the extent our sponsor, officers, directors or their respective affiliates purchase public shares, provided that each of their status as a public shareholder only exists with respect to such public shares; Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 14, 2022 PRELIMINARY PROSPECTUS Aimfinity Investment Corp. I $70,000,000 7,000,000 Units Aimfinity Investment Corp. I is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. While we will not be limited to a particular industry or geographic region in our identification and acquisition of a target company, we will not complete our initial business combination with a target that is headquartered in China (including Hong Kong and Macau) or conducts a majority of its business in China (including Hong Kong and Macau). This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one Class 1 redeemable warrant and one-half of one Class 2 redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering, and will (except for Class 2 redeemable warrants attached to shares that are redeemed in connection with our initial business combination, which Class 2 redeemable warrants will expire upon redemption of such shares) expire five years after the completion of our initial business combination or earlier upon redemption or our liquidation. The underwriters have a 45-day option from the date of this prospectus to purchase up to 1,050,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. Any Class 2 redeemable warrants that are attached to shares that are redeemed in connection with our initial business combination will expire upon redemption of such shares. The expiration of the Class 2 redeemable warrants upon redemption of the shares to which they are attached is different from a typical blank check company offering; see pages 27 and 109 of this prospectus for a discussion of the reasons for structuring the offering in this manner. If we have not consummated an initial business combination within 15 months from the closing of this offering (or (i) up to 21 months from the closing of this offering, if we extend the period of time to consummate a business combination subject to our sponsor depositing additional funds into the trust account, or (ii) during any shareholder approved extension period, as described in more detail in this prospectus), we will redeem 100% of the public shares, subject to applicable law and certain conditions as described herein. Our sponsor, Aimfinity Investment LLC, has agreed to purchase 450,000 private placement units, at a price of $10.00 per unit (or 492,000 private placement units if the underwriters exercise their over-allotment option in full), in a private placement to occur concurrently with the closing of this offering. Each private placement unit will be identical to the units sold in this offering, except as described in this prospectus. We refer to these units as the private placement units throughout this prospectus. Our initial shareholders, which include our sponsor, currently own 2,012,500 Class B ordinary shares, up to 262,500 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment of directors. Currently, there is no public market for our securities. We intend to apply to have our units listed on the Nasdaq Global Market ( Nasdaq ), under the symbol AIMAU. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect our Class 1 redeemable warrants and new units will be listed on Nasdaq under the symbols AIMAW and AIMBU, respectively, once the Class 1 redeemable warrants begin separate trading. Our Class A ordinary shares will not trade separately unless and until consummation of our initial business combination and have been approved for listing under the symbol AIMA. The Class 1 redeemable warrants will separate and begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless US Tiger Securities, Inc. and EF Hutton, division of Benchmark Investments, LLC inform us of its decision to permit earlier separate trading and we have satisfied certain conditions. The new units will not separate into Class A ordinary shares and Class 2 redeemable warrants, and the Class A ordinary shares and the Class 2 redeemable warrants will not trade separately, unless and until consummation of our initial business combination. US Tiger and EF Hutton are collectively referred to as the representatives in this prospectus. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 36 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Table of Contents public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); representatives are to US Tiger and EF Hutton; sponsor are to Aimfinity Investment LLC, a Cayman Islands limited liability company; warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and the private placement units; we, us, company or our company are to Aimfinity Investment Corp. I, a Cayman Islands exempted company; underwriter s option to purchase additional units are to the underwriters 45-day option to purchase up to an additional 1,050,000 units to cover over-allotments, if any; unicorns are start-up companies and projects with an estimated valuation exceeding $1 billion; and US Tiger are to US Tiger Securities, Inc., a New Jersey corporation, a representative of the underwriters in this offering. Each unit consists of one Class A ordinary share, one Class 1 redeemable warrant and one-half of one Class 2 redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise its option to purchase additional units and our sponsor will forfeit 262,500 founder shares. Our Company We are a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. We are focused on identifying unique business concepts with high-performing organizations that have both aspirations to accelerate growth and create enduring value within the technology sector. While we will not be limited to a particular industry or geographic region in our identification and acquisition of a target company, we will not complete our initial business combination with a target that is headquartered in China (including Hong Kong and Macau) or conducts a majority of its business in China (including Hong Kong and Macau). Our Founders and Management Team and Board of Directors Founders and Management Jing ( George ) Cao, Chief Executive Officer and Director Jing ( George ) Cao, our Chief Executive Officer and director, is an experienced technology and finance industry professional. In May 2018, Mr. Cao founded and has since served as the Chief Executive Office of Table of Contents Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 70,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 3,850,000 Proceeds, before expenses, to us $ 9.45 $ 66,150,000 (1) Includes (i) $0.35 per unit, or $2,450,000 in the aggregate (or $2,817,500 in the aggregate if the over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States, as described herein, and (ii) $0.20 per unit, or $1,400,000 in the aggregate (or $1,610,000 in the aggregate if the over-allotment option is exercised in full), payable to the underwriters upon the closing of this offering. The amounts in the trust account will be released to the underwriters only upon the consummation of an initial business combination. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement units described in this prospectus, $71,400,000, or $82,110,000 if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case), will be deposited into a U.S. based trust account with U.S. Bank National Association acting as trustee, after deducting $1,400,000 (or $1,610,000 if the underwriters exercise their over-allotment option in full) in underwriting discounts and commissions payable upon the closing of this offering and an aggregate of $1,050,000 to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Joint Book-Running Manager Joint Book-Running Manager Tiger Brokers EF HUTTON Division of Benchmark Investments, LLC The date of this prospectus is , 2022 Table of Contents AscendEX, a global digital asset trading platform that offers a variety of products to global users. Since March 2018, he also served as the Chief Executive Officer of HD Consulting Service LLC, a technology consulting service firm in New York, BMXDM Technology PTE. Limited, a technology holdings company for a trading platform, and Global Digital Mercantile Holdings Limited. Prior to these positions, from January 2013 to January 2018, Mr. Cao founded and served as the Chief Investment Officer of Delpha Capital Management, LLC ( Delpha Capital ), a New York based firm that specialized in quantitative trading. Prior to Delpha Capital, from August 2010 to November 2012, Mr. Cao was a senior Portfolio Manager in the Equity Division of Barclays Capital ( Barclays ) in both their New York and London offices. From August 2008 to July 2010, Mr. Cao was a Portfolio Manager at Knight Capital Group where he researched and traded U.S. equities. Mr. Cao earned a Ph.D. in Computer Science from the University of Chicago and a bachelor s degree in Computer Science and Engineering from the University of Science and Technology of China. Nicholas Torres III, Chief Financial Officer Nicholas Torres III, our Chief Financial Officer, has over 15 years of experience working in finance and capital markets-related roles. Since December 2021, Mr. Torres has been serving as the Senior Financial Controller for AscendEX, a global digital asset trading platform that offers a variety of products to global users. From May 2016 to December 2021, he served as a Controller in the Finance Division of CFO Services at Bloomberg LP. From November 2012 to April 2016, Mr. Torres served as an Associate for the Private Equity and Corporate Accounting Division at Goldman Sachs. From April 2011 to October 2012, he served as an Assistant Controller for Corporate Accounting and Financial Reporting at Safway Atlantic, a scaffolding and industrial services company. Prior to Safway Atlantic, Mr. Torres served as a Financial Analyst for PricewaterhouseCoopers from June 2007 to April 2011. Mr. Torres holds a bachelor s degree in Economics from Syracuse University. Qiang ( Alvin ) Wang, Director Qiang ( Alvin ) Wang will serve as a director upon the completion of this offering. Mr. Wang is an experienced banking and asset management professional. Since February 2020, Mr. Wang has served as the general manager of 7BP Owner, LLC, a wholly owned subsidiary of Bank of China Group Investment Limited in the US, with main emphasis on acquisition of company equity, asset acquisition, and mature commercial real estate projects such as office buildings and commercial mix used buildings in first-tier cities and core areas. As the General Manager, Mr. Wang manages and participates in all aspects of the company s real estate asset investment in the US, and provides comprehensive financing solutions across the capital structure and risk spectrum. Prior to this role, from October 2011 to February 2020, Mr. Wang served as a vice president and a senior manager of the Bank of China USA in New York where his main responsibilities pertained to corporate banking and financial institutions. Mr. Wang earned a bachelor s degree in Business Administration from Dowling College, and a bachelor s degree in Music Management from Shandong Normal University. Independent Directors Xin ( Warren ) Wang, Independent Director Xin ( Warren ) Wang will serve as an independent director upon the completion of this offering. Since March 2020, Mr. Wang is Chairman and Chief Executive Officer of Genesis Medtech Corporation ( Genesis ), headquartered in Singapore. Genesis is a fully integrated medtech platform in China, with activities ranging from product development and innovation, manufacturing to distribution. Table of Contents Prior to setting up Genesis, from June 2012 to March 2020, Mr. Wang was Senior Vice President and President, for Asia Pacific, for Boston Scientific, and a member of its Executive Committee. Throughout his 8 years in Boston Scientific, Mr. Wang laid a strong foundation for sustainable business expansion and built a strong, diversified and high performing team that achieved strong growth in Asia Pacific region. Prior to Boston Scientific, he was with Johnson & Johnson for 11 years where he held successively senior roles based in the US, culminating in his appointment as vice president of the medical device business in China. Mr. Wang started his career with British Petroleum. With more than two decades of experience as a senior executive and business development strategist in the med-tech industry, Mr. Wang has a wealth of expertise in developing new business collaborations. He is passionate about championing meaningful innovations that can have a measurable impact on patients lives. Throughout his career, Mr. Wang has focused on driving change in the med-tech industry, whilst providing business partners with opportunities to make an impact. Mr. Wang earned an MBA in Marketing and Finance from the University of Chicago, Booth School of Business, and a bachelor s degree in Economics from the University of International Business and Economics in Beijing. Joshua Gordon, Independent Director Joshua Gordon will serve as an independent director upon the completion of this offering. Since 2018, Mr. Gordon has been serving as a managing member for Karma Mobility LLC, a telecommunications service provider. In 2005, Mr. Gordon founded and has been serving as the Chief Executive Officer of Red Pocket, Inc., a Mobile Virtual Network Operator (MVNO) business. Prior to Red Pocket, Inc., in 2005, Mr. Gordon co-founded and has been serving as a Member of the Board of the Democracy Council, a Los Angeles-based non-profit, non-partisan organization dedicated to strengthening democratic institutions around the world. In 2021, Mr. Gordon was a Tech Executive Leadership Initiative (TELI) Fellow at the Aspen Institute. He previously held executive positions at Verestar, Inc., an American Tower company (NYSE: AMT), Interpacket Networks, and Justice Telecom, and he was a Degree Fellow at the East-West Center in Honolulu, Hawaii. Mr. Gordon holds a Juris Doctor from Harvard Law School, a Master of Arts in Southeast Asian Studies from the University of Hawaii-Manoa, and a bachelor s degree from Williams College. James J. Long, Independent Director James J. Long will serve as an independent director upon the completion of this offering. Since 2005, Mr. Long has been serving as the Chairman and Chief Executive Officer of MDLand International Corp. ( MDLand ), a digital healthcare company based in New York City providing cloud-based technology solutions to medical practices and healthcare organizations since October 2005. From 1998 to 2005, Mr. Long was a Vice President/Consultant at JPMorgan Chase, responsible for the development and the support of applications for treasury services solutions. From 1995 to 1997, Mr. Long was a system engineer at Periphonic Corp. (acquired by Nortel Networks Inc.) to develop the first-generation natural language processing-based voice applications and was a principal engineer at Medical Systems for the federally-fund small business innovation research ( SBIR ) project. Mr. Long holds a Master of Science degree in Physics with a concentration in digital signal processing from the University of Wisconsin and a bachelor s degree in Physics with a concentration in microcomputer from Sun Yat-Sen University. Together, we believe our directors and the rest of our management team bring additional expertise that will enhance our ability to identify and execute our initial business combination, and may enhance our ability to execute upon various value creation initiatives after successful completion of our business combination. Table of Contents Notwithstanding our founders and management team s past experiences, including investments and transactions in which they have participated and businesses with which they have been associated, past performance is not a guarantee (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) that we will provide an attractive return to our shareholders from any business combination we may consummate. Our officers and directors may have conflicts of interest with other entities to which they owe fiduciary or contractual obligations with respect to initial business combination opportunities. In order to minimize potential conflicts of interest which may arise from multiple affiliations, our officers and directors who are also officers and directors of any other entities will be required to present all suitable target businesses to such entities prior to presenting them to us, unless such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent such individual is permitted to refer that opportunity to us without violating another legal obligation. You should not rely on the historical record of our founders and management s performance as indicative of our future performance. See Risk Factors Past Performance by our management team or their respective affiliates may not be indicative of future performance of an investment in us. For a list of our executive officers, directors and entities for which a conflict of interest may or does exist between such officers, directors and the Company, please refer to Management Conflicts of Interest. Business Strategy and Competitive Strengths Our business strategy is to identify and complete our initial business combination with high growth technology and tech-enabled businesses domestically and abroad (excluding China, Hong Kong and Macau) in the consumer internet, e-commerce, software, cloud computing, healthcare, transportation / mobility or financial services industries, as well as other industries that are being disrupted by advances in technology. Our selection process will leverage our founders broad and deep relationship network, unique industry experiences and proven deal sourcing capabilities to access a broad spectrum of differentiated opportunities. This network has been developed through our founders extensive experience and demonstrated success in both investing in and operating businesses in our target sectors and across a variety of industries. Upon completion of this offering, our founders will communicate with their networks of relationships to articulate the parameters for our search for a target company and a potential business combination and begin the process of pursuing and reviewing potential opportunities. We believe that our management team is well positioned to identify attractive business combination opportunities with a compelling industry backdrop and an opportunity for transformational growth. Our founders objectives are to generate attractive returns for shareholders and enhance value through improving operational performance of the acquired company. We expect to favor opportunities with certain industry and business characteristics. Key industry characteristics include compelling long-term growth, attractive competitive dynamics, consolidation opportunities and low risk of technological obsolescence. Key business characteristics include high barriers to entry, significant streams of recurring revenue, opportunity for operational improvement, attractive steady-state margins, high incremental margins and attractive free cash flow characteristics. See the section entitled Proposed Business Effecting Our Initial Business Combination for further information on such key industry and business characteristics we intend to address in our search for and growth of a target business. Business Combination Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a Table of Contents target business that does not meet these criteria and guidelines. We intend to seek to acquire businesses that we believe: are fundamentally sound but are underperforming their potential; exhibit unrecognized value or other characteristics that we believe have been misevaluated by the marketplace; are at an inflection point where we believe we can drive improved financial performance; offer opportunities to enhance financial performance through organic initiatives and/or inorganic growth opportunities that we identify in our analysis and due diligence; can benefit from our founders knowledge of the target sectors, proven collection of operational strategies and tools, and past experiences in profitably and rapidly scaling businesses; are valued attractively relative to their existing cash flows and potential for operational improvement; and offer an attractive potential return for our shareholders, weighing potential growth opportunities and operational improvements in the target business against any identified downside risks. These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors and criteria that our management may deem relevant. However, we will not complete our initial business combination with a target that is headquartered in China (including Hong Kong and Macau) or conducts a majority of its business in China (including Hong Kong and Macau). In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the SEC. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent management, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information which will be made available to us. We will also utilize our management team s expertise in analyzing and evaluating operating plans, financial projections and determining the appropriate return expectations given the risk profile of the target business as well as the suitability of the target to become a public company. Members of our management team and board of directors may, directly or indirectly, own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at approximately $0.012 per share, the holders of our founder shares (including our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public shareholders lose money on their investment as a result of a decrease in the post-combination value of their ordinary shares (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, such officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Table of Contents Initial Business Combination Nasdaq rules require that we must complete one or more business combinations with a total aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding any deferred underwriters fees and taxes payable on the interest income earned on the trust account) at the time of our signing of a definitive agreement in connection with our initial business combination. We refer to this as the 80% of net assets test. If our board of directors determines that it is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or an independent valuation or appraisal firm, with respect to the satisfaction of such criteria. In addition, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We will have until 15 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 15 months, we will, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination by up to six times, each time by an additional month (for a total of 21 months to complete a business combination), subject to the sponsor depositing additional funds into the trust account as set out below. In connection with any such extension, public shareholders will not be offered the opportunity to vote on or redeem their shares. Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and U.S. Bank National Association on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination for an additional month, our sponsor or its affiliates or designees must deposit into the trust account $233,333, or up to $268,333 if the underwriter s over-allotment option is exercised in full ($0.033333 per share in either case), up to an aggregate of $1,400,000 or $1,610,000 if the underwriter s over-allotment option is exercised in, or $0.20 per share, on or prior to the date of the deadline. We will issue a press release announcing each extension at least three days prior to the deadline. In addition, we will issue a press release the day after the deadline, announcing whether the funds have been timely deposited. Our sponsor and its affiliates or designees are obligated to fund the trust account in order to extend the time for us to complete our initial business combination, but our sponsor will not be obligated to extend such time. Our sponsor and its affiliates or designees are obligated to fund the trust account in order to extend the time for us to complete our initial business combination, but our sponsor will not be obligated to extend such time. In addition to the foregoing arrangements, we may extend the period of time to consummate a business combination by a shareholder vote to amend our amended and restated memorandum and articles of association. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding shares of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares after our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction Table of Contents company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test. If our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net asset test. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our securities. Before making an investment decision, you should read this entire prospectus carefully, especially Risk Factors and the financial statements and related notes thereto, and the other documents to which this prospectus refers. Some of the statements in this prospectus constitute forward-looking statements that involve risks and uncertainties. See Cautionary Note Regarding Forward-Looking Statements for more information. Alvotech Alvotech is a highly integrated biotech company focused solely on the development and manufacture of biosimilar medicines for patients worldwide. Our purpose is to improve the health and quality of life of patients around the world by improving access to proven treatments for various diseases. Since our inception, we have built our company with key characteristics we believe will help us capture the substantial global market opportunity in biosimilars: a leadership team that has brought numerous successful biologics and biosimilars to market around the world; a purpose-built biosimilars R&D and manufacturing platform; top commercial partnerships in global markets; and a diverse, expanding pipeline addressing many of the biggest disease areas and health challenges globally. Alvotech is a company committed to constant innovation: we focus our platform, people and partnerships on finding new ways to drive access to more affordable biologic medicines. For more information about Alvotech, see the sections entitled Business and Management s Discussion and Analysis of Financial Condition and Results of Operation. Committed Equity Financing On April 18, 2022, we entered into the Standby Equity Purchase Agreement ( SEPA ) with Yorkville pursuant to which we have the right to sell to Yorkville up to $150,000,000 of our Ordinary Shares, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA. Sales of Ordinary Shares to Yorkville under the SEPA, and the timing of any such sales, are at our option, and we are under no obligation to sell any securities to Yorkville under the SEPA. In accordance with our obligations under the SEPA, we have filed the registration statement that includes this prospectus with the SEC to register under the Securities Act the resale by Yorkville of up to 15,306,122 Ordinary Shares that we may elect, in our sole discretion, to issue and sell to Yorkville, under the SEPA. Upon the satisfaction of the conditions to Yorkville s purchase obligation set forth in the SEPA, including that the registration statement of which this prospectus forms a part be declared effective by the SEC and the final form of this prospectus is filed with the SEC, we will have the right, but not the obligation, from time to time at our discretion until the first day of the month following the 36-month period after the date of the SEPA, to direct Yorkville to purchase a specified amount of Ordinary Shares (each such sale, an Advance ) by delivering written notice to Yorkville (each, an Advance Notice ). While there is no mandatory minimum amount for any Advance, it may not exceed the lesser of (i) $20,000,000 in respect of an Advance Notice in which the Company elects a one-day pricing period or (ii) $60 million in respect of an Advance Notice in which the Company elects a three-day pricing period. The per share subscription price Yorkville will pay for the Ordinary Shares will be 98.0% of the market price during a one- or three-day pricing period elected by Alvotech. The Market Price is defined in the SEPA as the lowest daily VWAPs (as defined below) during one trading day, in the case of a one-day pricing period, or of the three consecutive trading days, in the case of a three-day pricing period, commencing on the trading day following the date Alvotech submits an Advance Notice to Yorkville. VWAP means, for any trading day, the Table of Contents The information in this preliminary prospectus is not complete and may be changed. The selling securityholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, dated September 14, 2022 PRELIMINARY PROSPECTUS Up to 15,306,122 Ordinary Shares This prospectus relates to the resale of up to 15,306,122 Ordinary Shares, $0.01 nominal value per share (the Ordinary Shares ), by YA II PN, LTD., a Cayman Islands exempt limited partnership ( Yorkville ). The shares included in this prospectus consist of Ordinary Shares that we may, in our discretion, elect to issue and sell to Yorkville, from time to time after the date of this prospectus, pursuant to a standby equity purchase agreement we entered into with Yorkville on April 18, 2022 (the SEPA ), in which Yorkville has committed to purchase from us, at our direction, up to $150,000,000 of our Ordinary Shares, subject to terms and conditions specified in the SEPA. As of the date of this prospectus, we have not issued any Ordinary Shares to Yorkville. See the section entitled Committed Equity Financing for a description of the SEPA and the section entitled Selling Securityholder for additional information regarding Yorkville. Our registration of the securities covered by this prospectus does not mean that Yorkville will offer or sell any of the Ordinary Shares. Yorkville may offer, sell or distribute all or a portion of their Ordinary Shares publicly or through private transactions at prevailing market prices or at negotiated prices. We will not receive any proceeds from the sale of Ordinary Shares by Yorkville pursuant to this prospectus. However, we may receive up to $150,000,000 in aggregate gross proceeds from sales of our Ordinary Shares to Yorkville that we may, in our discretion, elect to make, from time to time after the date of this prospectus, pursuant to the SEPA. We provide more information about how Yorkville may sell or otherwise dispose of our Ordinary Shares in the section entitled Plan of Distribution. Yorkville is an underwriter within the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended. We are a foreign private issuer under applicable Securities and Exchange Commission (the SEC ) rules and an emerging growth company as that term is defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ) and are eligible for reduced public company disclosure requirements. Our Ordinary Shares and warrants are listed on The Nasdaq Global Market ( Nasdaq ) under the symbols ALVO and ALVOW, respectively. On September 13, 2022, the closing price of our Ordinary Shares was $7.54. Our Ordinary Shares are also listed on the Nasdaq First North Growth Market ( Nasdaq First North ) under the ticker symbol ALVO, and to ensure compliance with applicable Icelandic and European securities rules and regulations, due to the listing of our Ordinary Shares on Nasdaq First North, this Registration Statement on Form F-1 will be published on Nasdaq First North s website as well. You should read this prospectus and any prospectus supplement or amendment carefully before you invest in our securities. Investing in our securities involves risks. See Risk Factors beginning on page 11 of this prospectus. Neither the SEC nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents INDUSTRY AND MARKET DATA This prospectus contains estimates, projections, and other information concerning Alvotech s industry and business, as well as data regarding market research, estimates, and forecasts prepared by Alvotech s management. Information that is based on estimates, forecasts, projections, market research, or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. The industry in which Alvotech operates is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section titled Risk Factors. Unless otherwise expressly stated, Alvotech obtained this industry, business, market, and other data from reports, research surveys, studies, and similar data prepared by market research firms and other third parties, industry and general publications, government data, and similar sources. In some cases, Alvotech does not expressly refer to the sources from which this data is derived. In that regard, when Alvotech refers to one or more sources of this type of data in any paragraph, you should assume that other data of this type appearing in the same paragraph is derived from sources which Alvotech paid for, sponsored, or conducted, unless otherwise expressly stated or the context otherwise requires. While Alvotech has compiled, extracted, and reproduced industry data from these sources, Alvotech has not independently verified the data. Forecasts and other forward-looking information with respect to industry, business, market, and other data are subject to the same qualifications and additional uncertainties regarding the other forward-looking statements in this prospectus. See Cautionary Note Regarding Forward-Looking Statements. Table of Contents daily volume weighted average price of the Ordinary Shares for such date on NASDAQ as reported by Bloomberg L.P. during regular trading hours. There is no upper limit on the subscription price per share that Yorkville could be obligated to pay for the Ordinary Shares. We will control the timing and amount of any sales of Ordinary Shares to Yorkville. Actual sales of our Ordinary Shares to Yorkville under the SEPA will depend on a variety of factors to be determined by us from time to time, which may include, among other things, market conditions, the trading price of our Ordinary Shares and determinations by us as to the appropriate sources of funding for our business and its operations. Yorkville will not be obligated to subscribe to any Ordinary Shares under the SEPA which, when aggregated with all other Ordinary Shares then beneficially owned by Yorkville and its affiliates (as calculated pursuant to Section 13(d) of the Exchange Act, and Rule 13d-3 promulgated thereunder), would result in the beneficial ownership by Yorkville and its affiliates to exceed 9.99% of the outstanding voting power or number of Ordinary Shares (the Beneficial Ownership Limitation ). The net proceeds under the SEPA to us will depend on the frequency and prices at which we sell Ordinary Shares to Yorkville. We expect that any proceeds received by us from such sales to Yorkville will be used for working capital and general corporate purposes. Yorkville has agreed that it and its affiliates will not engage in any short sales of the Ordinary Shares nor enter into any transaction that establishes a net short position in the Ordinary Shares during the term of the SEPA. The SEPA will automatically terminate on the earliest to occur of (i) the first day of the month next following the 36-month anniversary of the date of the SEPA or (ii) the date on which Yorkville shall have made payment of Advances pursuant to the SEPA for Ordinary Shares equal to $150,000,000. We have the right to terminate the SEPA at no cost or penalty upon five (5) trading days prior written notice to Yorkville, provided that there are no outstanding Advance Notices for which Ordinary Shares need to be issued and Alvotech has paid all amounts owed to Yorkville pursuant to the SEPA. We and Yorkville may also agree to terminate the SEPA by mutual written consent. Neither we nor Yorkville may assign or transfer our respective rights and obligations under the SEPA, and no provision of the SEPA may be modified or waived by us or Yorkville other than by an instrument in writing signed by both parties. As consideration for Yorkville s commitment to purchase Ordinary Shares at our direction upon the terms and subject to the conditions set forth in the SEPA, we paid YA Global II SPV, LLC, a subsidiary of Yorkville, (i) a structuring fee in the amount of $10,000 and (ii) a commitment fee in the amount of $750,000. The SEPA contains customary representations, warranties, conditions and indemnification obligations of the parties. The representations, warranties and covenants contained in such agreements were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting parties. We do not know what the subscription price for our Ordinary Shares will be and therefore cannot be certain as to the number of shares we might issue to Yorkville under the SEPA. As of July 14, 2022, there were 248,649,505 Ordinary Shares outstanding (excluding the 27,072,167 Ordinary Shares issued on July 4, 2022 and held in treasury by Alvotech s subsidiary, Alvotech Manco ehf.). Although the SEPA provides that we may sell up to $150,000,000 of our Ordinary Shares to Yorkville, only 15,306,122 Ordinary Shares are being registered for resale under the registration statement that includes this prospectus. If and when we elect to issue and sell shares to Yorkville, we may need to register for resale under the Securities Act additional Ordinary Shares in order to receive aggregate gross proceeds equal to the $150,000,000 available Table of Contents FREQUENTLY USED TERMS In this prospectus: Alvogen means Alvogen Lux Holdings S. r.l., a limited liability company (Soci t responsabilit limit e) incorporated and existing under the laws of the Grand Duchy of Luxembourg having its registered office at 5, Rue Heienhaff, L-1736 Senningerberg, Grand Duchy of Luxembourg and registered with the Luxembourg Trade and Company Register (Registre de Commerce et des Soci t s, Luxembourg) under number B 149045. Alvogen-Aztiq Loan Advance Conversion means the private placement dated July 12, 2022, pursuant to which Alvogen and Aztiq subscribed to 2,500,000 Ordinary Shares each, for a subscription price of $10.00 per share. Alvotech means as the context requires, (a) the registrant, a legal entity named Alvotech, previously known as Alvotech Lux Holdings S.A.S., a public limited liability company (soci t anonyme) incorporated and existing under the laws of the Grand Duchy of Luxembourg having its registered office at 9, Rue de Bitbourg, L-1273 Luxembourg, Grand Duchy of Luxembourg, registered with the Luxembourg Trade and Company Register (Registre de Commerce et des Soci t s, Luxembourg) under number B258884, individually or together with its consolidated subsidiaries; or (b) Alvotech Holdings. Alvotech Holdings means Alvotech Holdings S.A., a public limited liability company (soci t anonyme) incorporated under the laws of the Grand Duchy of Luxembourg having its registered office at 9, Rue de Bitbourg, L-1273 Luxembourg, Grand Duchy of Luxembourg and registered with the Luxembourg Trade and Company Register (Registre de Commerce et des Soci t s, Luxembourg) under number B 229193, individually or together with its consolidated subsidiaries. Alvotech Holdings Class A Ordinary Shares means the Class A Ordinary Shares, with a nominal value of $0.01 per share, of Alvotech Holdings, which converted into Ordinary Shares at the closing of the Business Combination. Alvotech Holdings Class B Shares means the Class B Shares, with a nominal value of $0.01 per share, of Alvotech Holdings, which converted into Ordinary Shares at the closing of the Business Combination. Alvotech Holdings Ordinary Shares means the Alvotech Holdings Class A Ordinary Shares and the Alvotech Holdings Class B Shares, collectively. Alvotech Holdings Shareholders means the holders of Alvotech Holdings Ordinary Shares. Aztiq means Aztiq Pharma Partners S. r.l., a limited liability company (Soci t responsabilit limit e) incorporated and existing under the laws of the Grand Duchy of Luxembourg having its registered office at 5, Rue Heienhaff, L-1736 Senningerberg, Grand Duchy of Luxembourg and registered with the Luxembourg Trade and Company Register (Registre de Commerce et des Soci t s, Luxembourg) under number B 147728. Business Combination means the transactions contemplated by the Business Combination Agreement, including the Mergers. Business Combination Agreement means the Business Combination Agreement, dated as of December 7, 2021 as may be amended, by and among OACB, Alvotech Holdings and Alvotech. Closing means the consummation of the Business Combination, which occurred on June 15, 2022. Closing Date means June 15, 2022, the date upon which the Closing occurred. Code means the Internal Revenue Code of 1986, as amended. Table of Contents to us under the SEPA, depending on market prices for our Ordinary Shares. If all of the 15,306,122 shares offered by Yorkville for resale under the registration statement that includes this prospectus were issued and outstanding as of the date hereof, such shares would represent approximately 5.8% of the total number of Ordinary Shares outstanding as of July 14, 2022. If we elect to issue and sell more than the 15,306,122 Ordinary Shares offered under this prospectus to Yorkville, we must first register for resale under the Securities Act any such additional shares, which could cause additional dilution to our shareholders. The number of shares ultimately offered for resale by Yorkville is dependent upon the number of Ordinary Shares we may elect to sell to Yorkville under the SEPA. There are substantial risks to our shareholders as a result of the sale and issuance of Ordinary Shares to Yorkville under the SEPA. These risks include the potential for substantial dilution and significant declines in our share price. See the section entitled Risk Factors. Issuances of our Ordinary Shares in this offering will not affect the rights or privileges of our existing shareholders, except that the economic and voting interests of each of our existing shareholders will be diluted as a result of any such issuance. Although the number of Ordinary Shares that our existing shareholders own will not decrease as a result of sales, if any, under the SEPA, the shares owned by our existing shareholders will represent a smaller percentage of our total outstanding shares after any such issuance to Yorkville. For more detailed information regarding the SEPA, see the section entitled Committed Equity Financing. Recent Developments Business Combination On June 15, 2022, Alvotech consummated the transactions contemplated by the Business Combination Agreement by and among OACB, Alvotech Holdings and Alvotech. Pursuant to the Business Combination Agreement: at the First Merger Effective Time, OACB merged with and into Alvotech, whereby (i) all of the outstanding shares of OACB were exchanged for Ordinary Shares on a one-for-one basis, pursuant to a share capital increase of Alvotech, and (ii) all of the outstanding OACB Warrants automatically ceased to represent a right to acquire shares of OACB and automatically represented a right to be issued one Ordinary Share on substantially the same contractual terms and conditions as were in effect immediately prior to the First Merger Effective Time under the terms of the Warrant Agreement, with Alvotech as the surviving company in the merger; immediately after the effectiveness of the First Merger but prior to the Conversion, Alvotech redeemed and cancelled the shares held by the initial sole shareholder of Alvotech pursuant to a share capital reduction of Alvotech; immediately after the effectiveness of the First Merger and the Redemption, the legal form of Alvotech changed from a simplified joint stock company (soci t par actions simplifi e) to a public limited liability company (soci t anonyme) under Luxembourg law; immediately after the change of the legal form of Alvotech, Alvotech issued 17,493,000 Ordinary Shares at a price of $10.00 per share pursuant to the PIPE Financing for aggregate gross proceeds of $174,930,000; and immediately following the effectiveness of the Conversion and the PIPE Financing, Alvotech Holdings merged with and into Alvotech, whereby all outstanding Alvotech Holdings Ordinary Shares were exchanged for Ordinary Shares, pursuant to a share capital increase of Alvotech, with Alvotech as the surviving company in the merger. Table of Contents Combined Company means Alvotech and its consolidated subsidiaries after giving effect to the Business Combination. Conversion means the change of Alvotech s legal form from a simplified joint stock company (soci t par actions simplifi e) to a public limited liability company (soci t anonyme) under Luxembourg law immediately after the effectiveness of the First Merger and the Redemption. Election means the election on Internal Revenue Service Form 8832 pursuant to Treasury Regulations Section 301.7701-3(c), effective as of the date of the First Merger Effective Time, for Alvotech to be classified as an association taxable as a corporation for U.S. federal income tax purposes. EMA means the European Medicines Agency. Exchange Act means the Securities Exchange Act of 1934, as amended. FDA means the U.S. Food and Drug Administration. First Merger means when OACB merges with and into Alvotech, with Alvotech as the surviving company. First Merger Effective Time means the date and time at which the notarial deed of the sole shareholder s resolutions of Alvotech approving the First Merger becomes effective, upon its publication in the Recueil Electronique des Soci t s et Associations (the Luxembourg legal gazette), subject to the execution of a plan of merger between OACB and Alvotech and the filing and registration of such Plan of First Merger and such other documents as required under the Companies Act (as amended) of the Cayman Islands. GAAP means United States generally accepted accounting principles. IFRS means the International Financial Reporting Standards as adopted by the International Accounting Standards Board. Initial Shareholders means the holders of the OACB Class B Ordinary Shares. IPO means OACB s initial public offering of units, consummated on September 21, 2020. JOBS Act means the Jumpstart Our Business Startups Act of 2012, as amended. Luxembourg Company Law means the Luxembourg law of August 10, 1915 on commercial companies, as amended. Mergers means the First Merger and the Second Merger collectively. Nasdaq means The Nasdaq Stock Market LLC. Nasdaq First North means the Nasdaq First North Growth Market. OACB means Oaktree Acquisition Corp. II, a Cayman Islands exempted company. OACB Class A Ordinary Shares means the Class A ordinary shares, par value 0.0001 per share, of OACB, which converted into Ordinary Shares at the closing of the Business Combination. OACB Class B Ordinary Shares or Founder Shares means the 6,250,000 Class B ordinary shares, par value $0.0001 per share, of OACB, which were issued to the Sponsor in a private placement prior to OACB s initial public offering and converted into Ordinary Shares at the closing of the Business Combination. Table of Contents Concurrently with the execution of the Business Combination Agreement, OACB and the Alvotech entered into the Initial Subscription Agreements with the Initial Subscribers, pursuant to which the Initial Subscribers have agreed to subscribe for, and Alvotech has agreed to issue to the Initial Subscribers, an aggregate of 15,393,000 Ordinary Shares at a price of $10.00 per share, for aggregate gross proceeds of $153,930,000. Subsequent to this Initial PIPE Financing, on January 18, 2022, OACB and Alvotech entered into the Subsequent Subscription Agreements with the Subsequent Subscribers, pursuant to which the Subsequent Subscribers have agreed to subscribe for, and Alvotech has agreed to issue to the Subsequent Subscribers, an aggregate of 2,100,000 Ordinary Shares at a price of $10.00 per share, for aggregate gross proceeds of $21,000,000. The aggregate number of Ordinary Shares to be issued pursuant to the PIPE Financing was 17,493,000 for aggregate gross proceeds of $174,930,000. The Subscription Agreements contain substantially the same terms, except that the investors that entered into the Foreign Subscription Agreement agreed to subscribe for Ordinary Shares at a price that is net of a 3.5% placement fee. In connection with the Business Combination, holders of 24,023,495 OACB Class A Ordinary Shares, or 96% of the shares with redemption rights, exercised their right to redeem their shares for cash at a redemption price of approximately $10.00 per share, for an aggregate redemption amount of $240,234,950. On the Closing Date, Alvotech, the Sponsor and certain Alvotech Holdings Shareholders entered into an Investor Rights and Lock-Up Agreement which provides customary demand and piggyback registration rights and which restricts the transfer of the Ordinary Shares during the applicable lock-up periods. On June 16, 2022, our Ordinary Shares and Warrants began trading on the Nasdaq, under the new ticker symbols ALVO and ALVOW , respectively. On June 23, 2022, our Ordinary Shares began trading on the Nasdaq First North under the ticker symbol ALVO and to ensure compliance with applicable Icelandic and European securities rules and regulations, due to the listing of our Ordinary Shares on Nasdaq First North, this Registration Statement on Form F-1 will be published on Nasdaq First North s website as well. In June 2022, Alvotech also announced that its commercial partner, STADA Arzneimittel AG ( STADA ), launched Alvotech s AVT02 product, a biosimilar to Humira (adalimumab), under the name Hukyndra in selected European countries, including France, Germany, Finland, and Sweden and that launches in further European countries are scheduled over the coming months. Implications of Being an Emerging Growth Company and a Foreign Private Issuer Alvotech qualifies as an emerging growth company as defined in the JOBS Act. As an emerging growth company, Alvotech may take advantage of certain exemptions from specified disclosure and other requirements that are otherwise generally applicable to public companies. These exemptions include: not being required to comply with the auditor attestation requirements for the assessment of our internal control over financial reporting provided by Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ); reduced disclosure obligations regarding executive compensation; and not being required to hold a nonbinding advisory vote on executive compensation or seek shareholder approval of any golden parachute payments not previously approved. Alvotech may take advantage of these reporting exemptions until it is no longer an emerging growth company. Alvotech is also considered a foreign private issuer and will report under the Exchange Act as a non-U.S. company with foreign private issuer status. This means that, even after Alvotech no longer qualifies as an emerging growth company, as long as it qualifies as a foreign private issuer under the Exchange Act, it will be exempt from certain provisions of the Exchange Act that are applicable to U.S. public companies, including: the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; Table of Contents OACB Ordinary Shares means the OACB Class A Ordinary Shares and the OACB Class B Ordinary Shares, collectively. OACB Private Placement Warrants means the warrants to purchase OACB Class A Ordinary Shares purchased in a private placement in connection with the IPO, which automatically ceased to represent a right to acquire purchase OACB Class A Ordinary Shares and automatically represented a right to acquire Ordinary Shares at the Closing of the Business Combination. OACB Public Warrants means each whole warrant of OACB entitling the holder to purchase one OACB Class A Ordinary Share at a price of $11.50 per share, which automatically ceased to represent a right to acquire purchase OACB Class A Ordinary Shares and automatically represented a right to acquire Ordinary Shares at the closing of the Business Combination. OACB Warrants means the OACB Public Warrants and the OACB Private Placement Warrants. Ordinary Shares means the ordinary shares, with a nominal value of $0.01 per share, of Alvotech. PIPE Financing means the private placement pursuant to which the Subscribers subscribed to Ordinary Shares, for a subscription price of $10.00 per share. Public Shares means the OACB Class A Ordinary Shares issued as part of the units sold in the IPO, which converted into Ordinary Shares at the closing of the Business Combination. Public Shareholders means the holders of the OACB Class A Ordinary Shares, which converted into Ordinary Shares at the closing of the Business Combination. Public Warrants means the former OACB Public Warrants converted at the First Merger Effective Time into a right to acquire one Ordinary Share on substantially the same terms as were in effect immediately prior to the First Merger Effective Time under the terms of the Warrant Agreement. Redemption means Alvotech s redemption and cancellation of the initial shares held by the initial sole shareholder of Alvotech pursuant to a share capital reduction of Alvotech immediately after the effectiveness of the First Merger but prior to the Conversion. SEC means the U.S. Securities and Exchange Commission. Second Merger means when Alvotech Holdings merges with and into Alvotech, with Alvotech as the surviving company. Second Merger Effective Time means the date and time at which the Second Merger becomes effective, on the Closing Date immediately after giving effect to the First Merger, the Redemption, the Conversion and the PIPE Financing. Securities Act means the Securities Act of 1933, as amended. Sponsor means Oaktree Acquisition Holdings II, L.P., a Cayman Islands exempted limited partnership. Sponsor Letter Agreement means the Sponsor Agreement, dated as of December 7, 2021, by and among OACB, Alvotech and Sponsor. Subscribers means the institutional investors that have committed to subscribe to Ordinary Shares in the PIPE Financing. Table of Contents the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events. Alvotech may take advantage of these reporting exemptions until such time that it is no longer a foreign private issuer. Alvotech could lose its status as a foreign private issuer under current SEC rules and regulations if more than 50% of Alvotech s outstanding voting securities become directly or indirectly held of record by U.S. holders and any one of the following is true: (i) the majority of Alvotech s directors or executive officers are U.S. citizens or residents; (ii) more than 50% of Alvotech s assets are located in the United States; or (iii) Alvotech s business is administered principally in the United States. Alvotech may choose to take advantage of some but not all of these reduced burdens. Alvotech has taken advantage of reduced reporting requirements in this prospectus. Accordingly, the information contained in this prospectus may be different from the information you receive from Alvotech s competitors that are public companies, or other public companies in which you have made an investment. As a foreign private issuer, Alvotech is permitted to follow certain Luxembourg corporate governance practices in lieu of certain listing rules of Nasdaq, or Nasdaq Listing Rules. Alvotech plans to follow the corporate governance requirements of the Nasdaq Listing Rules, except that it intends to follow Luxembourg practice with respect to quorum requirements for shareholder meetings in lieu of the requirement under Nasdaq Listing Rules that the quorum be not less than 33 1/3% of the outstanding voting shares. Under Alvotech s articles of association, at an ordinary general meeting, there is no quorum requirement and resolutions are adopted by a simple majority of validly cast votes. In addition, under Alvotech s articles of association, for any resolutions to be considered at an extraordinary general meeting of shareholders, the quorum shall be at least one half of our issued share capital unless otherwise mandatorily required by law. In addition, three of Alvotech s eight directors are independent as defined in Nasdaq listing standards and Alvotech currently has only one director who serves on the compensation committee who meets the heightened independence standards for members of a compensation committee. Summary Risk Factors Investing in our securities entails a high degree of risk as more fully described under Risk Factors. You should carefully consider such risks before deciding to invest in our securities. These risks include, among others: Alvotech has a limited operating history in a highly regulated environment, has incurred significant losses since its inception, anticipates that it may continue to incur significant losses for the immediate future and may never be profitable. The regulatory approval processes of the FDA, European Commission and comparable national or regional authorities are lengthy and time consuming and Alvotech cannot give any assurance that marketing authorization applications for any of its product candidates will receive regulatory approval. Alvotech s product candidates may cause unexpected side effects or have other properties that could delay or prevent their regulatory approval, limit the commercial profile of an approved label or result in significant negative consequences following marketing approval, if granted. Even if Alvotech obtains regulatory approval for a product candidate, its products will remain subject to continuous subsequent regulatory obligations and scrutiny. Alvotech relies on third parties to conduct its nonclinical and clinical studies, to manufacture aspects of clinical and commercial supplies of its product candidates, and to store critical components of its Table of Contents Trust Account means the trust account that held a portion of the proceeds of the IPO and the concurrent sale of the Private Placement Warrants prior to the Closing. Warrants means the former OACB Warrants converted at the First Merger Effective Time into a right to acquire one Ordinary Share on substantially the same terms as were in effect immediately prior to the First Merger Effective Time under the terms of the Warrant Agreement. Warrant Agreement means the warrant agreement, dated September 21, 2020 by and between OACB and Continental Stock Transfer & Trust Company, as warrant agent, governing OACB s outstanding warrants, which was assigned to and assumed by Alvotech pursuant to that certain Assignment, Assumption and Amendment Agreement dated as of June 15, 2022. Yorkville means YA II PN, LTD., a Cayman Islands exempt limited partnership. CONVENTIONS WHICH APPLY TO THIS PROSPECTUS In this prospectus, unless otherwise specified or the context otherwise requires: $, USD and U.S. dollar each refers to the United States dollar; and , EUR and euro each refers to the lawful currency of certain participating member states of the European Union. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Some of the statements in this prospectus constitute forward-looking statements that do not directly or exclusively relate to historical facts. You should not place undue reliance on such statements because they are subject to numerous uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Forward-looking statements include information concerning our possible or assumed future results of operations, including descriptions of our business strategy. These statements are often, but not always, made through the use of words or phrases such as believe, anticipate, could, may, would, should, intend, plan, potential, predict, will, expect, estimate, project, positioned, strategy, outlook, continue, possible, might and similar expressions. All such forward-looking statements involve estimates and assumptions that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed in the statements. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking statements are the following: the benefits of the Business Combination; Alvotech s financial performance following the Business Combination; the ability to maintain the listing of the Ordinary Shares or Warrants on Nasdaq and Nasdaq First North, following the Business Combination; changes in Alvotech s strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; Alvotech s strategic advantages and the impact those advantages will have on future financial and operational results; Alvotech s expansion plans and opportunities; Alvotech s ability to grow its business in a cost-effective manner; the implementation, market acceptance and success of Alvotech s business model; Table of Contents product candidates. If these third parties do not successfully carry out their contractual duties, or are not compliant with regulatory requirements, Alvotech may not be able to obtain regulatory approval for or commercialize its product candidates. Alvotech is subject to a multitude of risks related to manufacturing. Any adverse developments affecting the manufacturing operations of Alvotech s biosimilar products could substantially increase its costs and limit supply for its products, or could affect the approval status of its products. Alvotech may not realize the benefits expected through the Joint Venture and the Joint Venture could have adverse effects on Alvotech s business. Alvotech s biosimilar product candidates, if approved, will face significant competition from the reference products, from other biosimilar products that reference the same reference products including those which may have regulatory exclusivities, and from other medicinal products approved for the same indication(s) as the reference products. Alvotech s failure to effectively compete may prevent it from achieving significant market penetration and expansion. Alvotech currently has no marketing and sales organization. Alvotech is dependent on its partners for the commercialization of its biosimilar products candidates in certain major markets, and their failure to commercialize in those markets could have a material adverse effect on Alvotech s business and operating results. If Alvotech infringes or is alleged to infringe the intellectual property rights of third parties, its business could be harmed. Alvotech is involved in legal proceedings through its partner, JAMP Pharma, adverse to AbbVie that may impact Alvotech s adalimumab product, AVT02. Alvotech s recurring losses raise substantial doubt as to its ability to continue as a going concern. Alvotech has identified material weaknesses in its internal control over financial reporting. If Alvotech is unable to remediate these material weaknesses, or if Alvotech experiences additional material weaknesses in the future or otherwise is unable to develop and maintain an effective system of internal controls in the future, Alvotech may not be able to produce timely and accurate financial statements or comply with applicable laws and regulations. The sale and issuance of our Ordinary Shares to Yorkville will cause dilution to our existing shareholders, and the sale of Ordinary Shares acquired by Yorkville, or the perception that such sales may occur, could cause the price of our Ordinary Shares to fall. Table of Contents developments and projections relating to Alvotech s competitors and industry, including the estimated growth of the industry; Alvotech s approach and goals with respect to technology; Alvotech s expectations regarding its ability to obtain and maintain intellectual property protection and not infringe on the rights of others; the impact of the COVID-19 pandemic or the occurrence of unforeseen geopolitical events such as the Russia-Ukraine conflict on Alvotech s business; changes in applicable laws or regulations; the outcome of any known and unknown litigation and regulatory proceedings, including legal proceedings, directly or through its partners, adverse to AbbVie; Alvotech s ability to obtain and maintain regulatory approval for its product candidates of the FDA, European Commission and comparable national or regional authorities; Alvotech s ability to comply with all applicable laws and regulations; Alvotech s ability to successfully launch its products in certain markets after obtaining regulatory approval for such market; Alvotech s estimates of expenses and profitability; Alvotech s ability to identify and successfully develop new product candidates; Alvotech s relationship with third party providers for clinical and non-clinical studies, supplies, and manufacturing of its products; Alvotech s ability to manage its manufacturing risks; Alvotech s relationship with partners for the commercialization of its product candidates; Alvotech s ability to meet the conditions precedent to issue Ordinary Shares to Yorkville under the SEPA; the volatility of the price of Ordinary Shares that may result from sales of Ordinary Shares by Yorkville; and the dilution of holders of Ordinary Shares resulting from Alvotech s issuance Ordinary Shares to Yorkville. There can be no guarantee that how many Ordinary Shares Alvotech will issue under the SEPA, if at all. These forward-looking statements are based on information available as of the date of this prospectus, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. You should not place undue reliance on these forward-looking statements in deciding to invest in our securities. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include: the outcome of any legal proceedings that may be instituted against Alvotech following the Closing; the outcome of any legal or regulatory proceedings; the ability to maintain the listing of the Ordinary Shares on Nasdaq and Nasdaq First North; Table of Contents Corporate Structure The following diagram shows the ownership percentages (excluding the impact of the shares underlying the Warrants) and structure of Alvotech immediately as of June 15, 2022* after the Closing. * Alvotech Manco ehf. and Alvotech Biosciences India Private Limited were incorporated as wholly-owned subsidiaries of Alvotech hf. after the Closing. Corporate Information The legal entity named Alvotech, previously known as Alvotech Lux Holdings S.A.S., was incorporated under the laws of the Grand Duchy of Luxembourg on August 23, 2021 as a simplified joint stock company (soci t par actions simplifi e) having its registered office at 9, Rue de Bitbourg L-1273 Luxembourg, Grand Duchy of Luxembourg and registered with the Luxembourg Trade and Company Register (Registre de Commerce et des Soci t s, Luxembourg) under number B258884. On February 16, 2022, Alvotech Lux Holdings S.A.S. changed its name to Alvotech . On June 15, 2022, Alvotech consummated the Business Combination and changed its legal form from a simplified joint stock company (soci t par actions simplifi e) to a public limited liability company (soci t anonyme) under Luxembourg law. Alvotech s principal website address is www.alvotech.com. We do not incorporate the information contained on, or accessible through, Alvotech s websites into this prospectus, and you should not consider it a part of this prospectus. Table of Contents the risk that the consummation of the Business Combination and related transactions disrupts current plans and operations of Alvotech; our ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition and the ability of Alvotech to grow and manage growth profitably following the Business Combination; changes in applicable laws or regulations; the effects of the COVID-19 pandemic on Alvotech s business; the effects of competition on Alvotech s future business; Alvotech s position in the market against current and future competitors; Alvotech s expansion into new products, services, technologies or geographic regions; the ability to implement business plans, forecasts, and other expectations, and identify and realize additional opportunities and to continue as a going concern; the risk of downturns and the possibility of rapid change in the highly competitive industry in which Alvotech operates; the risk that Alvotech and its current and future commercial partners are unable to successfully develop, seek marketing approval for, and commercialize Alvotech s products or services, or experience significant delays in doing so; the risk that the Combined Company may never achieve or sustain profitability; the risk that the Combined Company will need to raise additional capital to execute its business plan, which may not be available on acceptable terms or at all; the risk that the Combined Company experiences difficulties in managing its growth and expanding operations; the risk that Alvotech has identified a material weakness in its internal control over financial reporting which, if not corrected, could affect the reliability of Alvotech s financial statements; the risk that Alvotech is unable to secure or protect its intellectual property; the risk that estimated growth of the industry does not occur, or does not occur at the rates or timing Alvotech has assumed based on third-party estimates and its own internal analyses; the possibility that Alvotech may be adversely affected by other economic, business, and/or competitive factors; and other risks and uncertainties described in this prospectus, including those under the section entitled Risk Factors. 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+PROSPECTUS SUMMARY This summary highlights selected information that is presented in greater detail elsewhere in this prospectus or incorporated by reference in this prospectus. Because it is only a summary, it does not contain all of the information you should consider before investing in our Common Stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information included elsewhere in this prospectus. Before you decide whether to purchase shares of our Common Stock, you should read this entire prospectus carefully, including the sections of this prospectus entitled
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+detailed information and financial data and statements contained elsewhere in this prospectus. This summary does not contain all of the information you should know about the Manager, our business and the Class A Shares. You should read this entire prospectus carefully, especially the Risk Factors section and the more detailed information and financial data and statements contained elsewhere in this prospectus. Some of the statements in this prospectus constitute forward-looking statements that involve risks and uncertainties. See Special Note Regarding Forward-Looking Information for more information. See Glossary for the definitions of certain defined terms used throughout this prospectus. Overview This prospectus has been prepared by the Manager and is being furnished to you as a shareholder of Brookfield Reinsurance in connection with the planned Special Distribution by Brookfield Reinsurance of approximately 2,725,500 Class A Shares to the holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares. The Manager was established by the Corporation as a company through which investors, including the existing shareholders of the Corporation and Brookfield Reinsurance, can directly access its leading, pure-play global alternative asset management business, to be owned and operated through the Asset Management Company. Immediately before Brookfield Reinsurance effects the Special Distribution, the Corporation intends to implement the Arrangement. The Arrangement involves the division of the Corporation into two publicly traded companies the Corporation, focused on deploying capital across its operating businesses and compounding that capital over the long term, and the Manager, a pure-play asset manager in a leading global alternative asset management business, which will own 25% of our asset management businesses and will be listed and its shares distributed to the existing shareholders of the Corporation. Our asset management business is a leading global alternative asset management business. The Arrangement is designed to enhance long-term value for the Corporation s shareholders by creating separate identities for these two distinct businesses, while preserving the mutual benefit and competitive advantages derived from the combination of the Corporation s significant resources and the Manager s asset management franchise. This benefits the Manager and the Corporation and thus their shareholders. On completion of the Arrangement (i) the shareholders of the Corporation will become shareholders of the Manager, which will acquire a 25% interest in our asset management business, while retaining their shares of the Corporation, and (ii) the Corporation will change its name to Brookfield Corporation . Following completion of the Arrangement, the Corporation and the Manager will each have the right to nominate one-half of the board of directors of our asset management business. The Corporation s shareholders will receive shares of the Manager pursuant to the Arrangement. Brookfield Reinsurance shareholders, as they are not shareholders of the Corporation, are not able to participate directly in the Arrangement, but Brookfield Reinsurance and the Corporation determined that it would be preferable to undertake the Special Distribution rather than adjusting the one-for-one exchange ratio for the Brookfield Reinsurance Class A Shares. The Arrangement will be subject to the satisfaction of a number of conditions and, as such, there can be no certainty that the Arrangement will proceed or proceed in the manner described. If the Arrangement does not proceed, Brookfield Reinsurance will not proceed with the Special Distribution. For more information on the Special Distribution and the Arrangement, see The Special Distribution . Our Business We are one of the world s leading alternative asset managers, with over $750 billion of assets under management as of June 30, 2022 across renewable power and transition, infrastructure, private equity, real estate Table of Contents and credit. We invest client capital for the long-term with a focus on real assets and essential service businesses that form the backbone of the global economy. We draw on our heritage as an owner and operator to invest for value and generate strong returns for our clients, across economic cycles. To do this, we leverage our exceptional team of over 2,000 investment and asset management professionals, our global reach, deep operating expertise and access to large-scale capital to identify attractive investment opportunities and invest on a proprietary basis. Our investment approach and strong track record have been the foundation and driver of our growth. We provide a highly diversified suite of alternative investment strategies to our clients and are constantly innovating new strategies to meet their needs. We have approximately 50 unique product offerings that span a wide range of risk-adjusted returns, including opportunistic, value-add, core, super-core, and credit. We evaluate the performance of these product offerings and our investment strategies using a number of non-GAAP measures as outlined in Management s Discussion and Analysis of Financial Condition and Results of Operations . The Manager will utilize Distributable Earnings to measure performance, while, in addition to this metric, Fee Revenues and Fee-Related Earnings are closely utilized in order to assess the performance of our asset management business. We have over 2,000 clients, made up of some of the world s largest institutional investors, including sovereign wealth funds, pension plans, endowments, foundations, financial institutions, insurance companies and individual investors. We are in a fortunate position to be trusted with our clients capital and our objective is to meet their financial goals and provide for a better financial future while providing a market leading experience. Our team of 250 client service professionals across 18 global offices are dedicated to our clients and ensuring we are exceeding their service expectations. Our guiding principle is to operate our business and conduct our relationships with the highest level of integrity. Our emphasis on diversity and inclusion reinforces our culture of collaboration, allowing us to attract and retain top talent. Strong ESG practices are embedded throughout our business, underpinning our goal of having a positive impact on the communities and environment within which we operate. Our asset management business will be operated through the Asset Management Company, owned 75% by the Corporation and 25% by the Manager. For more information on the relationship between the Manager, the Corporation and the Asset Management Company, see Relationship Arrangements . Value Creation We create shareholder value by increasing the earnings profile of our asset management business. Alternative asset management businesses such as ours are typically valued based on multiples of their fee-related earnings and performance income. Accordingly, we create value by increasing the amount and quality of fee-related earnings and carried interest, net of associated costs. This growth is achieved primarily by expanding the amount of fee-bearing capital we manage, earning performance income such as carried interest through superior investment results and maintaining competitive operating margins. As at June 30, 2022, we have Fee-Bearing Capital of approximately $392 billion, of which 80% is long-dated or perpetual in nature, providing significant stability to our earnings profile. We consider Fee-Bearing Capital that is long-dated or perpetual in nature to be Fee-Bearing Capital relating to our long-term private funds, which are typically committed for 10 years with two one-year extension options, and Fee-Bearing Capital relating to our perpetual strategies, which include the perpetual affiliates as well as capital we manage in our Table of Contents perpetual core and core plus private funds. We seek to increase our fee-bearing capital by growing the size of our existing product offering and developing new strategies that cater to our clients investment needs. We also aim to deepen our existing institutional relationships, develop new institutional relationships and access new distribution channels such as high net worth individuals and retail. As of June 30, 2022, we have over 2,000 clients with a strong base in North America, Asia, the Middle East and Australia and a growing proportion of third-party commitments from Europe. Our high-net-worth channel also continues to grow and is close to 10% of current commitments. We have a dedicated team of over 100 people that are focused on distributing and developing catered products to the private wealth channel. We are also actively progressing new growth strategies, including secondaries, technology, insurance and transition. These new initiatives, in addition to our existing strategies are expected to have a very meaningful impact on our growth trajectory in the long term. As we grow our fee-bearing capital, we earn incremental base management fees. In order to support this growth, we have been growing our exceptional team of investment and asset management professionals. Our costs are predominantly in the form of compensation for the over 2,000 professionals we employ globally. When deploying our clients capital, we seek to leverage our competitive advantages to acquire high-quality real assets or businesses that provide essential services that form the backbone of the global economy. We use our global reach and access to scale capital to source attractive investment opportunities and leverage our deep operating expertise to underwrite investments and create value throughout our ownership. Our goal is to deliver superior investment returns to our clients and successfully doing so results in the continued growth of realized carried interest. We generate robust free cash flows or Distributable Earnings, which is our primary financial performance metric. Distributable Earnings of the Manager represent its share of Distributable Earnings from our asset management business less general and administrative expenses, but excluding equity-based compensation costs, of the Manager. The Manager intends to pay out approximately 90% of its Distributable Earnings to shareholders quarterly and reinvest the balance back into the business. See Dividend Policy for more information. We also monitor the broader markets and occasionally identify attractive, strategic investment opportunities that have the potential to supplement our existing business and add to our organic growth. Acquisitions can allow us to achieve immediate scale in a new asset class or grant us access to additional distribution channels. An example of such growth is the partnership we formed with Oaktree in 2019. Such acquisitions may happen from time to time should they be additive to our franchise, attractive to our clients and accretive to our shareholders. Competitive Advantages We seek to harness three distinct competitive advantages that enable us to consistently identify and acquire high-quality assets and create significant value in the assets that we invest in and operate on behalf of our clients. We have over $750 billion in assets under management and approximately $392 billion in Fee-Bearing Capital as of June 30, 2022. We offer our investors a large portfolio of private funds that have global mandates and diversified strategies. Our access to large-scale, flexible capital that is further enhanced by our relationship with the Corporation, enables us to pursue transactions of a size that lessens competition. We are supported globally by approximately 180,000 operating employees of our managed businesses, who are instrumental in maximizing the value and cash flows of our managed assets. We believe that strong operating experience is essential in maximizing efficiency and productivity and ultimately, Table of Contents returns. We do this by maintaining a culture of long-term focus, alignment of interest and collaboration through the people we hire and our operating philosophy. This operating expertise developed through our heritage as an owner-operator is invaluable in underwriting acquisitions and executing value-creating development and capital projects. We invest on behalf of our clients in more than 30 countries on five continents around the world. Our global reach allows us to diversify and identify a broad range of opportunities. We can invest where capital is scarce, and our scale enables us to move quickly and pursue multiple opportunities across different markets. Our global reach also allows us to operate our assets more effectively: we believe that a strong on-the-ground presence is critical to operating successfully in many of our markets, and many of our businesses are truly local. Furthermore, the combination of our strong local presence and global reach enables us to bring global relationships and operating practices to bear across markets to enhance returns. For more information on our business, including our products, people, investment process and strategies and ESG management, see Our Business . Special Distribution Key Dates The key dates associated with the Special Distribution are as follows: Brookfield Reinsurance Meeting: November 9, 2022 Record Date: On or about the record date of the Arrangement Distribution Date: On or about the effective date of the Arrangement At the Brookfield Reinsurance Meeting, holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares approved the Capital Reduction Resolution approving the payment of the Special Distribution by way of a capital reduction. Therefore, it is expected that the Special Distribution will be effected as a capital reduction resulting in a return of capital, and not by way of a dividend. Except for the Canadian tax considerations described under Certain Canadian Federal Income Tax Considerations , there are no meaningful differences to holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares between the Special Distribution being implemented as a return of capital or a dividend. See The Special Distribution and Certain Canadian Federal Income Tax Considerations Taxation of Holders Resident in Canada . The Record Date for the Special Distribution has not yet been set. Brookfield Reinsurance expects to complete the Special Distribution on or about the effective date of the Arrangement. If the Arrangement does not proceed, Brookfield Reinsurance will not proceed with the Special Distribution. The Corporation will publicly announce the Record Date and the Distribution Date once such dates have been determined. Stock Exchange Listing There is currently no market for the Class A Shares. The NYSE has conditionally authorized the Manager to list the Class A Shares on the NYSE under the symbol BAM , and the TSX has conditionally approved the Manager s application to list the Class A Shares on the TSX under the symbol BAM . In connection with the Arrangement, the Manager expects that trading in the Class A Shares will commence on an if, as and when issued basis on the NYSE under the symbol BAM.WI and on the TSX under the symbol NBAM on a date prior to the Distribution Date, which will be announced by the Corporation in a press release. Following completion of the Arrangement, the Class A Shares are expected to commence trading on the NYSE and the TSX under the symbol BAM and the Corporation Class A Shares are expected to commence trading on the NYSE and the TSX under the symbol BN . The listing of the Class A Shares on the NYSE is subject to the Manager Table of Contents fulfilling all the requirements of the NYSE. The listing of the Class A Shares on the TSX is subject to the Manager fulfilling all the requirements of the TSX, including distribution of these securities to a minimum number of public shareholders. The Special Distribution The Special Distribution will result in holders of Brookfield Reinsurance Class A Shares receiving the same interest in the Manager that they would have received if they held Corporation Class A Shares directly and participated in the Arrangement. The holder of the Brookfield Reinsurance Class B Shares will also receive Class A Shares in the Special Distribution. Pursuant to the Special Distribution, holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares as of the Record Date will be entitled to receive one Class A Share for every four Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares held as of the Record Date, while retaining their shares of Brookfield Reinsurance. Based on approximately 10.9 million Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares outstanding, Brookfield Reinsurance expects to distribute on the Distribution Date approximately 2,725,500 Class A Shares to holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares as of the Record Date. Holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares will not be entitled to receive any fractional interest in a Class A Share, and those holders who would otherwise be entitled to a fractional Class A Share will instead receive a cash payment. The Class A Shares to be distributed pursuant to the Special Distribution will represent less than 1% of the aggregate Class A Shares issued and outstanding following completion of the Arrangement and the Special Distribution. If a holder of Brookfield Reinsurance Class A Shares wishes to exchange one or more of their Brookfield Reinsurance Class A Shares for Corporation Class A Shares (or its cash equivalent) in advance of the Arrangement, he or she is required to complete and deliver a notice of exchange at least ten business days in advance of completion of the Arrangement. It is currently expected that the Record Date for the Special Distribution will be less than ten business days before the completion of the Special Distribution. Accordingly, any notice of exchange received on or after the Record Date will not be processed, and no Corporation Class A Shares (or the cash equivalent) will be delivered, until following completion of Arrangement and the Special Distribution. Any Corporation Class A Shares received on exchange of Brookfield Reinsurance Class A Shares following completion of the Special Distribution will not be entitled to participate in the Arrangement, but those Brookfield Reinsurance Class A Shares will participate in the Special Distribution. See The Special Distribution . Corporate Structure The Manager was incorporated under the BCBCA on July 4, 2022 by the Corporation for the purpose of effecting the Arrangement. Prior to completion of the Arrangement, the Manager has not issued any shares and the Asset Management Company is a wholly-owned subsidiary of the Corporation. The following provides an illustration of the simplified corporate structure of the Manager immediately following completion of the Arrangement and the Special Distribution. See Corporate Structure . Table of Contents 1 If the Corporation implements the Arrangement, in order to effect the Special Distribution to shareholders of Brookfield Reinsurance (a) the Corporation will subscribe for shares of Brookfield Reinsurance (expected to be junior preferred shares) in exchange for approximately $150 million of cash and (b) thereafter Brookfield Reinsurance will use that cash to subscribe for approximately 2,725,500 Class A Shares (being the number of Class A Shares necessary to effect the Special Distribution). The foregoing subscriptions by the Corporation and Brookfield Reinsurance are for purposes of effecting the Special Distribution and are not a part of the Arrangement wherein the Corporation will contribute a 25% interest of Brookfield Asset Management ULC to the Manager, and in exchange, the Manager will effectively issue 383 million Class A Shares and 21,280 Class B Shares to the Corporation s existing shareholders on a pro-rata basis. Such subscriptions and the Special Distribution are shown as dotted lines in the above corporate structure chart. As a result of the Special Distribution, holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares as of the Record Date, will be entitled to receive one Class A Share for every four Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares held as of the Record Date, while retaining their shares of Brookfield Reinsurance. Immediately following completion of the Arrangement and the Special Distribution, (i) the holders of Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares will own, in aggregate, in connection with their shares of Brookfield Reinsurance 0.7% of the issued and outstanding Class A Shares, (ii) the shareholders of the Corporation will own, in aggregate, 95.7% of the Class A Shares (with the holders of two series of preference shares of the Corporation owning approximately 0.1%), and (iii) the Manager Escrowed Companies will own, in aggregate, 3.6% of the Class A Shares, which will be purchased from specified shareholders in connection with grants of Manager Escrowed Shares to certain holders of long-term share ownership awards of the Corporation pursuant to the Arrangement. Of the shares owned by the Table of Contents Corporation s shareholders, approximately 18.8% will be owned by the Partners and any affiliates, related entities and reporting insiders. Prior to completion of the Arrangement, the Manager did not issue any shares and was not owned by the Corporation, and after giving effect thereto the Corporation will not own any securities of the Manager and the Manager will not own any securities of the Corporation. See Security Ownership for more information on the beneficial ownership of the Manager s shares immediately following the Special Distribution. The Class A Shares and Class B Shares will each elect one-half of the Board. See Description of Share Capital of the Manager Class A Shares and Class B Shares Election of Directors . 2 The Corporation Class A Shares and Corporation Class B Shares each elect one-half of the Corporation s board. The Corporation Class B Shares are held by the BAM Partnership, which will also own the Class B Shares, and no other shares of Manager. The beneficial interests in the BAM Partnership, and the voting interests in its trustee, are held as follows: one-third by Jack L. Cockwell, one-third by Bruce Flatt, and one-third jointly by Brian W. Kingston, Brian D. Lawson, Cyrus Madon, Samuel J.B. Pollock and Sachin G. Shah in equal parts. These individuals, the majority of whom are also or will be directors and officers of Manager, will also beneficially own, in the aggregate (but not as a group) approximately 11.7% of the Class A Shares. The trustee will vote the Class B Shares with no single individual or entity controlling the BAM Partnership. See Security Ownership for more information on the BAM Partnership. 3 Each Brookfield Reinsurance Class A Share was structured with the intention of providing an economic return equivalent to one Corporation Class A Share, and is exchangeable with the Corporation at the option of the holder for one Corporation Class A Share (subject to adjustment to reflect certain capital events) or its cash equivalent (the form of payment to be determined at the election of the Corporation). The Brookfield Reinsurance Class A Shares and Brookfield Reinsurance Class B Shares each elect one-half of the board of Brookfield Reinsurance. The Brookfield Reinsurance Class B Shares are owned by a trust and the beneficial interests in the trust, and the voting interests in its trustee, are held as follows: Bruce Flatt (40%), Brian W. Kingston (40%) and Sachin G. Shah, Anuj Ranjan and Connor Teskey (20% in equal parts). The Corporation indirectly owns 100% of the non-voting Class C Shares of Brookfield Reinsurance and will continue to do so after completion of the Arrangement. 4 Following completion of the Arrangement, the Corporation and the Manager will each have the right to nominate one-half of the board of directors of the Asset Management Company. See Relationship Arrangements Ownership and Governance of Our Asset Management Business for more information. Prior to completion of the Arrangement and the Special Distribution, the Asset Management Company was a wholly-owned subsidiary of the Corporation. After completion of the Arrangement and the Special Distribution, the Asset Management Company will be owned 75% by the Corporation and 25% by the Manager through their ownership of common shares of the Asset Management Company. 5 BBU, BEP, BIP and BPY are limited partnerships formed under the laws of Bermuda. Economic interest is shown. Prior to completion of the Arrangement and the Special Distribution, the Corporation also indirectly owned 100% of the shares of the general partners of BBU, BEP, BIP and BPY, each of which is a company formed under the laws of Bermuda. After completion of the Arrangement and the Special Distribution, the Corporation will continue to own 100% of the shares of the general partners of such companies. 6 Includes Manager Escrowed Companies that will be consolidated by the Manager. Relationship Arrangements Upon completion of the Arrangement, the Corporation and the Manager will have 75% and 25%, respectively, ownership of our asset management business. Due to the ownership interest in the Asset Management Company of the Manager and the Corporation, if the Corporation and the Manager do not make pro rata investments in the Asset Management Company, whether in connection with acquisitions or otherwise, the relative percentage shareholdings of the Corporation and the Manager would change. The Manager and the Corporation have entered into, or will enter into, several agreements that will outline their relationship with respect to, among other things, board nominations for the Asset Management Company, preserving the mutual benefit and competitive advantages derived from the combination of the Corporation s significant resources and the Manager s asset management franchise, and sharing of carried interest and similar distributions. See Relationship Arrangements . Table of Contents Relationship Agreement The Corporation, the Manager and the Asset Management Company have entered into the Relationship Agreement to govern aspects of their relationship following the Arrangement. Under the Relationship Agreement, the Corporation has the right (but not the obligation) to participate up to 25% in each new sponsored fund or other entity of our asset management business, and this includes any participation by the Corporation s perpetual affiliates and Brookfield Reinsurance. Any commitment of our asset management business to such sponsored fund will be separate from the up to 25% allocation of the Corporation. The Corporation has no obligation to provide backstops or other guarantees relating to new investments or acquisitions, or to commit capital on a transitional basis while other investors are being sourced, but any arrangements or understandings existing at the time of completion of the Arrangement will be continued. The Corporation will retain all of the ownership interests in the perpetual affiliates and the Asset Management Company will be entitled to receive the incentive distributions (if any) paid following completion of the Arrangement. In addition, the Manager and the Asset Management Company agree with the Corporation that they will perform (or cause the Service Providers to perform) all obligations that the Service Providers have under the Master Services Agreements and Affiliate Relationship Agreements. The base management fee will be earned by the Service Providers and the parties agree that these agreements cannot be terminated without the Corporation s consent. See Relationship Arrangements Governance and Management of Perpetual Affiliates . The Corporation is entitled to receive 33.3% of the carried interest and similar distributions on new sponsored funds and open-end funds of our asset management business and will retain 100% of the carried interest earned on mature funds. For more information on the Corporation s entitlement to carried interest and similar distributions, see Relationship Arrangements Sharing of Carried Interest and Other Distributions . The Corporation and the Asset Management Company will be responsible for clawback obligations in relation to carried interest or similar distributions in the same proportion as their entitlements. The Asset Management Company has a pre-emptive right over acquisition opportunities presented to the Corporation that relate to businesses whose revenues are predominantly derived from asset management activities, but the Corporation is not otherwise subject to restrictions in its pursuit of any other types of acquisitions or transactions. Voting Agreement Following the completion of the Arrangement, the Corporation and the Manager will enter into the Voting Agreement in order to provide for the following agreements relating to the board of directors of the Asset Management Company: the number of directors of the company is fixed at four directors, unless agreed otherwise, notwithstanding a change in the shareholding of either party; each of the Corporation and the Manager have the right to nominate one-half of the directors of the company, and agree to vote their shares in favor of those four nominated directors; and each nominated director may at any time and for any reason be removed from the board of the company by the shareholder that nominated the director (and only that shareholder), and the vacancy created, and any other vacancy, will also be filled by a director nominated by the shareholder whose nominated director has left the board. The Voting Agreement is not a unanimous shareholder agreement and does not give either party additional governance rights relating to, or take any powers away from, the directors of the company to manage or supervise the management of the business and affairs of the company. See Relationship Arrangements Ownership and Governance of Our Asset Management Business . Table of Contents Dividend Policy The Manager intends to pay dividends to shareholders on a quarterly basis equal to approximately 90% of its Distributable Earnings in the preceding quarter. Our asset management business intends to pay dividends to the Manager and the Corporation on a quarterly basis sufficient to ensure that the Manager can pay its intended dividend. Dividends will be variable and will change in line with the growth of Distributable Earnings. The Manager intends to retain 10% or less of its Distributable Earnings each quarter to support organic or inorganic growth initiatives or to opportunistically repurchase Class A Shares. Any determination to pay dividends in the future will be at the discretion of the Board (and the board of our asset management business) and will depend on many factors, including, among others, the Manager s (and our asset management business ) financial condition, current and anticipated cash requirements, contractual restrictions and financing agreement covenants, solvency tests imposed by applicable corporate law and other factors. The Manager intends to adopt a Dividend Reinvestment Plan following completion of the Arrangement and Special Distribution, which will enable registered holders of Class A Shares who are resident in the U.S. or Canada to receive their dividends in the form of newly issued Class A Shares. See Dividend Policy . Share Capital In order to foster within the Manager the same benefits of long-term stability and continuity as the Corporation has benefited from, the share capital of the Manager has been structured to mirror that of the Corporation, providing holders of the Class A Shares with governance rights that are intended to be the same as the rights of holders of the Corporation Class A Shares. Following completion of the Arrangement, the Manager s authorized share capital will consist of: (i) an unlimited number of Class A Preference Shares, issuable in series (the number of shares and the provisions attached to each series of which may be fixed by the Board); (ii) an unlimited number of Class A Shares; and (iii) 21,280 Class B Shares. Immediately following completion of the Arrangement and the Special Distribution, approximately 400 million Class A Shares, 21,280 Class B Shares and no Class A Preference Shares are expected to be issued and outstanding. See Description of Share Capital of the Manager . Following completion of the Arrangement, the shareholders of Brookfield Reinsurance and the Corporation will hold all of the Class A Shares. The Class B Shares will be held by the BAM Partnership, which also holds the Corporation Class B Shares. The beneficial interests in the BAM Partnership, and the voting interests in its trustee, are held as follows: one-third by Jack L. Cockwell, one-third by Bruce Flatt, and one-third jointly by Brian W. Kingston, Brian D. Lawson, Cyrus Madon, Samuel J.B. Pollock and Sachin G. Shah in equal parts. These individuals, the majority of whom also are or will be directors and officers of the Manager, will also beneficially own, in the aggregate (but not as a group) approximately 11.7% of the Class A Shares. The trustee will vote the Class B Shares with no single individual or entity controlling the BAM Partnership. See Security Ownership . Subject to the prior rights of the holders of the Class A Preference Shares and any other senior-ranking shares outstanding from time to time, holders of Class A Shares and Class B Shares rank on a parity with each other with respect to the payment of dividends (if, as and when declared by the Board) and the return of capital on the liquidation, dissolution or winding up of the Manager or any other distribution of the assets of the Manager among its shareholders for the purpose of winding up its affairs. Except as set out below, each holder of Class A Shares and Class B Shares is entitled to notice of, and to attend and vote at, all meetings of the Manager s shareholders, other than meetings at which holders of only a specified class or series may vote, and shall be entitled to cast one vote per share. Subject to applicable law and in addition to any other required shareholder approvals, all matters to be approved by shareholders (other than the election of directors), must be approved: by a majority or, in the case of matters that require approval by a special resolution of shareholders, at least 66 2 3%, of the votes cast by holders of Class A Shares who vote in respect of the resolution or special resolution, as the case may be; and by a majority or, in the case of matters that require approval by a special resolution of shareholders, at least 66 2 3%, of the votes cast by holders of Class B Shares who vote in respect of the resolution or special resolution, as the case may be. On any matters for the Manager Table of Contents that require shareholder approval, approval must be obtained from the holders of the Class A Shares and the holder of the Class B Shares, in each case voting separately as a class. In the event that holders of Class A Shares vote for a resolution and the holder of Class B shares votes against, or vice versa, such resolution would not receive the requisite approval and would therefore not be passed. In the election of directors, holders of Class A Shares are entitled to elect one-half of the Board and holders of Class B Shares are entitled to elect the other one-half of the Board. Summary of Certain Canadian Federal Income Tax Considerations For Canadian federal income tax purposes, the amount of the Special Distribution will be equal to the aggregate fair market value of the Class A Shares plus the amount of cash in lieu of fractional Class A Shares so distributed. Subject to the qualifications set forth below under Certain Canadian Federal Income Tax Considerations Taxation of Holders Resident in Canada , the Special Distribution will generally not be included in computing the income of a Resident Holder (as defined herein) but will reduce the adjusted cost base of the Resident Holder s Brookfield Reinsurance Class A Shares. Subject to the qualifications set forth below under Certain Canadian Federal Income Tax Considerations Taxation of Holders not Resident in Canada a Non-Resident Holder generally should not be subject to Canadian withholding tax or other income tax under the Tax Act on the Special Distribution. Holders of Brookfield Reinsurance Class A Shares are urged to consult their tax advisers regarding the Canadian federal income tax consequences of the Special Distribution in light of their particular circumstances. Summary of Certain United States Federal Income Tax Considerations For U.S. federal income tax purposes, and subject to the assumptions, qualifications, and limitations set forth below under Certain United States Federal Income Tax Considerations , the Manager understands that Brookfield Reinsurance intends to take the position that a U.S. Holder who receives Class A Shares in the Special Distribution will be considered to have received a taxable distribution on Brookfield Reinsurance Class A Shares in an amount equal to the fair market value of the Class A Shares received by the holder plus the amount of cash received in lieu of fractional Class A Shares. This distribution would be treated as a dividend to the extent of a U.S. Holder s share of current or accumulated earnings and profits of Brookfield Reinsurance, as determined under U.S. federal income tax principles. If the amount of the distribution were to exceed Brookfield Reinsurance s current and accumulated earnings and profits, the excess would be treated as a non-taxable recovery of basis to the extent of the holder s basis in Brookfield Reinsurance Class A Shares, and then as capital gain. As of the date hereof, the Manager understands that Brookfield Reinsurance believes that it has no accumulated earnings and profits, nor does it expect it to have earnings and profits for the current taxable year or in the foreseeable future. Accordingly, the Special Distribution generally is expected to be treated in whole or in part as a non-taxable recovery of basis, depending on a U.S. Holder s adjusted tax basis in Brookfield Reinsurance Class A Shares at the time of the Special Distribution, although no assurance can be provided in this regard. See Certain United States Federal Income Tax Considerations . Holders of Brookfield Reinsurance Class A Shares are urged to consult their tax advisers regarding the U.S. federal income tax consequences of the Special Distribution in light of their particular circumstances.
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+Prospectus Summary 1 The Offering 3 Risk Factors 4 Cautionary Statement Concerning Forward-Looking Statements 9 Use of Proceeds 11 Market Price of our Common Stock and Dividend Policy 12 Selling Stockholder 13 Description of Capital Stock 14 Plan of Distribution 18 Certain U.S. Federal Income Tax Consequences to Non-U.S. Holders 22 Experts 26 Legal Matters 27 Where You Can Find More Information 28 Incorporation By Reference 29 Table of Contents PROSPECTUS SUMMARY This summary contains basic information about us and this offering. Because it is a summary, it does not contain all of the information that you should consider before investing. Before you decide to invest in our common stock, you should carefully read the entire prospectus and the documents incorporated by reference herein, including the sections titled Risk Factors in this prospectus and any documents incorporated by reference herein. Overview We are a provider of secure information delivery services with a scalable Software-as-a-Service ( SaaS ) platform. We serve more than one million customers of all sizes, from enterprises to individuals, across over 50 countries and multiple industry verticals including healthcare, financial services, law and education. Beginning as an online fax company over two decades ago, we have evolved into a leading global provider of enterprise secure communication solutions. Our communication and digital signature solutions enable our customers to securely and cooperatively access, exchange and use information across organizational, regional and national boundaries. Our mission is to democratize secure information interchange across technologies and industries, and solve the healthcare interoperability challenge. All of our revenue recurring in nature and is generated either via fixed subscription plans or usage-based contracts. Over the past decade, Consensus has progressively shifted focus towards larger commercial customers (Corporate). As enterprise data communication shifted toward digitization and cloud-based solutions, Consensus entered industry verticals such as legal, compliance, insurance, and healthcare. Our Corporate business has grown from $148 million of revenue in 2020 to approximately $170 million of revenue in 2021, representing a 13.9% annual growth rate. We currently serve approximately 45,000 Corporate customers, generally small/medium businesses or large enterprises, to whom sales are made through direct interaction with a sales person and involve specific pricing, multiple line subscriptions, API connections and/or commercial grade security. We currently serve over one million small office/home office ( SoHo ) online fax customers, generally consumers and SoHo users, who acquire a pre-defined subscription through an e-commerce website without direct interaction with a sales person. Our SoHo brands include jSign , eFax , MyFax , Sfax , Metrofax , and SRfax . In 2020, we launched the Consensus Unite healthcare interoperability platform, a comprehensive workflow collaboration and data exchange solutions suite. Healthcare represents our largest industry vertical and has information, secure communication, management and interoperability needs. The sector is undergoing a large-scale digitization effort, with the objective to streamline workflows, increase efficiency for operators, and increase transparency for patients. We believe our leadership in digital fax and our deep experience in the healthcare industry positions Consensus well to help healthcare providers accomplish their broader digitization and interoperability objectives. On October 7, 2021, Ziff Davis, Inc. (then known as J2 Global, Inc.) completed its previously announced plans to separate into two leading publicly traded companies: one addressing healthcare interoperability and comprising the Cloud Fax business, which is doing business as Consensus Cloud Solutions, Inc., and one that is continuing Ziff Davis strategy of building a leading internet platform focused on key verticals, including technology & gaming, shopping, health, cybersecurity and martech, which is doing business as Ziff Davis. We refer to the transactions that resulted in the separation of Consensus and Ziff Davis into two separate publicly traded companies as the separation and distribution. Table of Contents The information in this preliminary prospectus supplement is not complete and may be changed. This preliminary prospectus supplement and the accompanying prospectus do not constitute an offer to sell these securities, and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus Supplement dated June 7, 2022 PROSPECTUS SUPPLEMENT (To Prospectus dated , 2022) 2,000,000 shares Consensus Cloud Solutions, Inc. Common Stock The selling stockholders identified in this prospectus supplement are offering 2,000,000 shares of our common stock. We are not selling any shares of common stock under this prospectus supplement and the accompanying prospectus, and we will not receive any of the proceeds from the sale of shares of our common stock by the selling stockholders. All 2,000,000 shares of our common stock that are being offered and sold in this offering are currently held by Ziff Davis, Inc. ( Ziff Davis ). We are registering such shares under the terms of a stockholder and registration rights agreement between us and Ziff Davis. In connection with this offering, Ziff Davis will exchange up to 2,300,000 shares of our common stock for certain indebtedness of Ziff Davis held by J.P. Morgan Securities LLC ( J.P. Morgan ) and Citicorp North America, Inc. ( CNAI ), which we refer to, in such role, as the debt-for-equity exchange parties, pursuant to a debt-for-equity exchange agreement to be entered into following the date of this prospectus supplement. The debt-for-equity exchange parties, as the selling stockholders in this offering, will then offer those shares of our common stock in this offering. The selling stockholders, and not Ziff Davis or us, will receive the proceeds from the sale of the shares in this offering. However, as a result of exchanging the shares of our common stock with the selling stockholders prior to this offering, Ziff Davis may be deemed to be a selling stockholder in this offering solely for U.S. federal securities law purposes. We refer to this exchange between Ziff Davis and the selling stockholders as the debt-for-equity exchange. The debt-for-equity exchange will occur on the settlement date of this offering immediately prior to, and its consummation is a condition to, the settlement of the selling stockholders sale of the shares to the underwriters. As a result, the consummation of the debt-for-equity exchange is also ultimately a condition to the settlement of the underwriters sale of the shares to prospective investors. Our common stock is listed on The Nasdaq Stock Market LLC ( Nasdaq ) under the symbol CCSI. On June 6, 2022, the closing price of our common stock as reported on Nasdaq was $48.23 per share. Per Share Total Public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds to the selling stockholders, before expenses $ $ (1) See Underwriting (Conflict of Interest) for additional information regarding underwriting compensation. The underwriters have the option to purchase up to an additional 300,000 shares of our common stock from the selling stockholders at the public offering price less the underwriting discount for 30 days after the date of this prospectus supplement. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense. The underwriters are offering the shares of our common stock as set forth under Underwriting (Conflict of Interest). Delivery of the shares of our common stock will be made on or about , 2022. J.P. Morgan Evercore ISI Citigroup Prospectus Supplement dated , 2022. Table of Contents ABOUT THIS PROSPECTUS This prospectus is part of a registration statement we filed with the Securities and Exchange Commission (the SEC ) using a shelf registration process. Under this shelf registration process, the selling stockholder may, from time to time, offer and sell, in one or more offerings, shares of our common stock. At the time the selling stockholder offers shares of our common stock registered by this prospectus, if required, we will provide a prospectus supplement that will contain specific information about the terms of the offering and that may add to or update the information in this prospectus or incorporated by reference in this prospectus. If the information in this prospectus is inconsistent with a prospectus supplement, you should rely on the information in that prospectus supplement. You should read this prospectus, the information incorporated by reference into this prospectus and any applicable prospectus supplement as well as any post-effective amendments to the registration statement of which this prospectus forms a part before you make any investment decision. The rules of the SEC allow us to incorporate information by reference into this prospectus. This information incorporated by reference is considered to be part of this prospectus. See Incorporation of Certain Information by Reference. You should read both this prospectus and any applicable prospectus supplement together with additional information described under the heading Where You Can Find Additional Information. We are responsible for the information incorporated by reference or contained in this prospectus, any applicable prospectus supplement or in any free writing prospectus prepared by or on behalf of us that we have referred to you. Neither we nor the selling stockholder has authorized anyone to provide you with additional information or information different from that contained in this prospectus or in any free writing prospectus filed with the SEC and we take no responsibility for any other information that others may give you. The selling stockholder is offering to sell, and seeking offers to buy, shares of our common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of shares of our common stock. Our business, operating results or financial condition may have changed since such date. Unless the context otherwise requires, references in this prospectus to Consensus, the Company, we, us and our refer to Consensus Cloud Solutions, Inc. and our subsidiaries. INDUSTRY AND MARKET DATA The market data and certain other statistical information included or incorporated by reference into this prospectus includes industry data and forecasts that are based on independent industry publications, government publications or other published independent sources. Some data is also based on our good faith estimates. Although we believe these third-party sources are reliable as of their respective dates, we have not independently verified the accuracy or completeness of this information. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the sections entitled Risk Factors included or incorporated by reference into this prospectus. These and other factors could cause results to differ materially from those expressed in these publications. TRADEMARKS, TRADENAMES AND SERVICE MARKS Consensus owns or has rights to use the trademarks, service marks and trade names that it uses in conjunction with the operation of its business. Consensus holds several internet domain names, including eFax , SFax , SRFax, MyFax , and eFax Corporate , among others. Each trademark, trade name or service mark of any other company included or incorporated by reference into this prospectus is, to our knowledge, owned by such other company. Table of Contents Corporate Information Consensus was incorporated in Delaware for the purpose of holding the Cloud Fax business, including the equity interests in J2 Cloud Services LLC, the legal entity holding the Cloud Fax business, in connection with the separation and the distribution. The address of our principal executive offices is 700 S. Flower Street, 15th Floor, Los Angeles, California 90017. Our telephone number is (323) 860-9200. Table of Contents THE OFFERING Common stock offered by the selling stockholder Up to 3,960,607 shares of our common stock Use of proceeds All shares of our common stock sold pursuant to this prospectus will be offered and sold by the selling stockholder. We will not receive any proceeds from such sale. See Use of Proceeds. Selling stockholder Ziff Davis, Inc., or as otherwise indicated herein or in any prospectus supplement. See Selling Stockholder. Plan of Distribution The selling stockholder may offer the shares in amounts, at prices and on terms determined by market conditions at the time of the offering. The selling stockholder may sell shares through agents it selects or through underwriters and dealers it selects. The selling stockholder also may sell shares directly to investors. If the selling stockholder uses agents, underwriters or dealers to sell the shares, we will name them and describe their compensation in a prospectus supplement. See Plan of Distribution. Risk Factors For a discussion of risks and uncertainties involved with an investment in our common stock, see Risk Factors beginning on page 4 and any risk factors described in any accompanying prospectus supplement, as well as the risk factors and other information contained in our Annual Report on Form 10-K for the year ended December 31, 2021 (the 2021 Form 10-K ) and our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 (the First Quarter 2022 Form 10-Q ), which are each incorporated by reference into this prospectus. Listing Our common stock is listed on Nasdaq under the symbol CCSI. Unless we indicate otherwise, all information in this prospectus is based on 20,015,370 shares of our common stock outstanding as of June 6, 2022, and excludes (i) 2,911,042 shares of common stock reserved for issuance under the Company s 2021 Equity Incentive Plan and (ii) 974,079 shares of common stock available for purchase under the Company s 2021 Employee Stock Purchase Plan. Table of Contents ABOUT THIS PROSPECTUS SUPPLEMENT You should rely only on the information contained in this prospectus supplement and the accompanying prospectus or to which we have referred you. This document consists of two parts. The first part is this prospectus supplement, which describes the specific terms of this offering. The second part is the accompanying prospectus, which describes more general information, some of which may not apply to this offering. If the description of the offering varies between this prospectus supplement and the accompanying prospectus, you should rely on the information in this prospectus supplement. None of Consensus, the selling stockholders or any underwriter have authorized anyone to provide you with information different from, or inconsistent with, the information contained in this prospectus supplement and the accompanying prospectus. None of Consensus, the selling stockholders or any underwriter are making an offer to sell these securities in any jurisdiction where such offer or sale is not permitted. We, the selling stockholders and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. The information contained in this prospectus supplement and the accompanying prospectus is accurate only as of the date of this prospectus supplement, regardless of the time of delivery of this prospectus supplement and the accompanying prospectus or of any sale of our common stock. Our business, financial condition, results of operations and prospects may have changed since that date. This prospectus supplement is a part of a registration statement on Form S-1 that we filed with the U.S. Securities and Exchange Commission (the SEC ) using a shelf registration or continuous offering process. Under this shelf process, the selling stockholders may from time to time sell shares of our common stock covered by this prospectus supplement and the accompany prospectus. Additionally, under the shelf process, in certain circumstances, we may provide an additional prospectus supplement that will contain certain specific information about the terms of a particular offering by the selling stockholders. We may also provide an additional prospectus supplement to add information to, or update or change information contained in this prospectus supplement and the accompanying prospectus. You should read this prospectus supplement and the accompanying prospectus, together with any other applicable prospectus supplement and the information incorporated by reference before deciding to invest in shares of our common stock. You may obtain this information without charge by following the instructions under Where You Can Find More Information appearing elsewhere in this prospectus supplement. Unless otherwise mentioned or unless the context requires otherwise, throughout this prospectus supplement, the words Consensus we, us, our or the Company refer to Consensus Cloud Solutions, Inc., and the term securities refers to shares of our common stock. S-ii Table of Contents RISK FACTORS Investing in our securities involves a high degree of risk. Before making an investment decision with respect to our securities, we urge you to carefully consider the risks described in the Risk Factors sections of our 2021 Form 10-K and our First Quarter 2022 Form 10-Q filed with the SEC and incorporated by reference into this prospectus. In addition, the following risk factors present material risks and uncertainties associated with this offering. The risks and uncertainties incorporated by reference into this prospectus or described below are not the only ones we face. Additional risks and uncertainties not presently known or which we consider immaterial as of the date hereof may also have an adverse effect on our business. If any of the matters discussed in the Risk Factors sections of our 2021 Form 10-K and our First Quarter 2022 Form 10-Q and the following risk factors were to occur, our business, financial condition, results of operations, cash flows or prospects could be materially adversely affected, the market price of our common stock could decline and you could lose all or part of your investment in our common stock. Risks Related to the Offering The trading market for our common stock has existed for only a short period following the distribution. The price and trading volume of our common stock has been and may continue to be volatile and the value of an investment in our common stock could decline. Prior to the distribution, there was no public market for our common stock. An active trading market for our common stock commenced only recently following the distribution and may not be sustainable. The market price and trading volume of our common stock has fluctuated substantially and may continue to do so due to a number of factors, some of which may be beyond our control, including: actual or anticipated fluctuations in our operating results; changes in earnings estimated by securities analysts or our ability to meet those estimates; the operating and stock price performance of comparable companies; changes to the regulatory and legal environment in which we operate; and domestic and worldwide economic conditions. Stock markets in general have experienced volatility that has often been unrelated to the operating performance of a particular company. These broad market fluctuations could also adversely affect the trading price of our common stock. The selling stockholder owns 3,960,607 shares of our common stock. We are registering such shares on a registration statement on Form S-1, of which this prospectus forms a part, under the terms of a registration rights agreement between us and the selling stockholder. The sale of such shares in one or more offerings or any other future sales may cause our stock price to decline. Any sales of substantial amounts of our common stock in the public market or the perception that such sales might occur, in connection with this offering or otherwise, may cause the market price of our common stock to decline. Upon completion of the offering, we will continue to have an aggregate of approximately 20,015,370 million shares of our common stock issued and outstanding. Shares will generally be freely tradeable without restriction or further registration under the Securities Act, except for shares owned by one of our affiliates, as that term is defined in Rule 405 under the Securities Act. Shares held by affiliates may be sold in the public market if registered or if they qualify for an exemption from registration under Rule 144 under the Securities Act. Further, on October 8, 2021, we filed a registration statement on Form S-8 registering an aggregate of 5,000,000 shares of common stock underlying equity awards we have made and will make to our employees and certain other qualifying individuals, and the resale of those shares of common stock. If equity securities granted under our 2021 Equity Incentive Plan are sold or it is perceived that they will be sold in the public market, the trading price of our common stock could decline substantially. These sales also could impede our ability to raise future capital. Table of Contents INDUSTRY AND MARKET DATA The market data and certain other statistical information included or incorporated by reference into this prospectus supplement includes industry data and forecasts that are based on independent industry publications, government publications or other published independent sources. Some data is also based on our good faith estimates. Although we believe these third-party sources are reliable as of their respective dates, we have not independently verified the accuracy or completeness of this information. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the sections entitled Risk Factors included or incorporated by reference into this prospectus supplement. These and other factors could cause results to differ materially from those expressed in these publications. TRADEMARKS, TRADENAMES AND SERVICE MARKS Consensus owns or has rights to use the trademarks, service marks and trade names that it uses in conjunction with the operation of its business. Consensus holds several internet domain names, including eFax , SFax , SRFax, MyFax , and eFax Corporate , among others. Each trademark, trade name or service mark of any other company included or incorporated by reference into this prospectus supplement is, to our knowledge, owned by such other company. S-iii Table of Contents The selling stockholder owns 3,960,607 shares of our common stock. We are a party to a stockholder and registration rights agreement with Ziff Davis, pursuant to which we agreed, upon request of Ziff Davis, we will use our reasonable best efforts to effect the registration under applicable federal and state securities laws of any shares of our common stock that it retains. We are filing the registration statement on Form S-1 of which this prospectus forms a part pursuant to a request from Ziff Davis to register all shares of our common stock held by Ziff Davis. Sales by Ziff Davis or others of a substantial number of shares after the distribution, or a perception that such sales could occur, could significantly reduce the market price of our common stock. See Certain Relationships and Related Person Transactions Agreements Between Us and Ziff Davis Stockholder and Registration Rights Agreement incorporated by reference from our proxy statement filed on May 2, 2022 (the 2022 proxy statement ) into our 2021 Form 10-K, which is incorporated by reference into this prospectus. Any disposition by Ziff Davis of our common stock in the public market in one or more offerings, or the perception that such dispositions could occur, could adversely affect prevailing market prices for our common stock. We do not intend to pay dividends on our common stock. We have no present intention to pay cash dividends on our common stock. Any determination to pay dividends to holders of our common stock will be at the discretion of our board of directors and will depend upon many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in our existing and any future debt and other factors that our board of directors deems relevant. Reduced reporting and disclosure requirements applicable to us as an emerging growth company could make our common stock less attractive to investors. We are an emerging growth company ( EGC ) and, for as long as we continue to be an EGC, we may choose to continue to take advantage of exemptions from various reporting requirements applicable to other public companies. Consequently, we are not required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act, and we are subject to reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. In addition, the JOBS Act provides that an EGC can take advantage of an extended transition period for complying with new or revised accounting standards. We have elected to take advantage of the extended transition period. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of the dates such pronouncements are effective for public companies. We will cease to be an EGC upon the earliest of: (i) the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement filed under the Securities Act, (ii) the first fiscal year after our annual gross revenue is $1.07 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1 billion in nonconvertible debt securities or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year. We cannot predict whether investors will find our common stock less attractive if we choose to rely on these exemptions. If some investors find our common stock less attractive as a result of any choices to reduce future disclosure, there may be a less active trading market for our common stock, and the price of our common stock may be more volatile. We have identified a material weakness in our internal control over financial reporting, and if our remediation of such material weakness is not effective, or if we experience additional material weaknesses or otherwise fail to design and maintain effective internal control over financial reporting we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results. As a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and the Dodd-Frank Act and are required to prepare our financial statements according to the rules and Table of Contents SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus supplement, the accompanying prospectus, the documents incorporated by reference into this prospectus supplement and the accompanying prospectus, and other written or oral statements that we make from time to time contain, or will contain, certain forward-looking statements regarding business strategies, market potential, future financial performance and other matters. The words will, should, believe, expect, anticipate, project and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made. The matters discussed in these forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those projected, anticipated or implied in the forward-looking statements. You should read this prospectus supplement, the accompanying prospectus, as well as our Annual Report on Form 10-K for the year ended December 31, 2021 (the 2021 Form 10-K ) and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 (the First Quarter 2022 Form 10-Q ), which are each incorporated by reference herein, completely and with the understanding that actual future results may be materially different from expectations. All forward-looking statements made in this prospectus supplement, the accompanying prospectus and the documents incorporated or deemed to be incorporated by reference herein or therein are qualified by these cautionary statements. In particular, information included in this prospectus supplement, the accompanying prospectus or the documents incorporated by reference into this prospectus under headings such as Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and Business contain forward-looking statements. Where, in any forward-looking statement, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of our management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. Any forward-looking statement speaks only as of the date on which it is made. Except as may be required by law, we undertake no obligation to modify or revise any forward-looking statements to reflect events or circumstances occurring after the date of this information statement. Factors that could cause actual results or events to differ materially from those anticipated include, but are not limited to, the matters described in this prospectus supplement, the accompanying prospectus or the documents incorporated by reference into this prospectus supplement under headings such as Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Some factors that could cause actual results to differ materially from those anticipated in these forward-looking statements include, but are not limited to, our ability and intention to: Sustain growth or profitability, particularly in light of an uncertain U.S. or worldwide economy and the related impact on customer acquisition and retention rates, customer usage levels and credit and debit card payment declines; Maintain and increase our customer base and average revenue per user; Generate sufficient cash flow to make interest and debt payments and reinvest in our business, and pursue desired activities and businesses plans while satisfying restrictive covenants relating to debt obligations; Acquire businesses on acceptable terms and successfully integrate and realize anticipated synergies from such acquisitions; Continue to expand our Cloud Fax business and operations internationally in the wake of numerous risks, including adverse currency fluctuations, difficulty in staffing and managing international operations, higher operating costs as a percentage of revenues or the implementation of adverse regulations; Maintain our financial position, operating results and cash flows in the event that we incur new or unanticipated costs or tax liabilities, including those relating to federal and state income tax and indirect taxes, such as sales, value-added and telecommunication taxes; Accurately estimate the assumptions underlying our effective worldwide tax rate; S-iv Table of Contents regulations required by the SEC. In addition, the Exchange Act requires that we file annual, quarterly and current reports. Our failure to prepare and disclose this information in a timely manner or to otherwise comply with applicable law could subject us to penalties under federal securities laws, expose us to lawsuits and restrict our ability to access financing. In addition, the Sarbanes-Oxley Act requires, among other things, that we establish and maintain effective internal controls and procedures for financial reporting and disclosure purposes. Internal control over financial reporting is complex and may be revised over time to adapt to changes in our business, or changes in applicable accounting rules. As reported in our 2021 Form 10-K, we have identified a material weakness in our internal control over financial reporting related to our accounting for the separation and distribution. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our consolidated financial statements will not be prevented or detected on a timely basis. We cannot assure you that the measures we have taken to date, and actions we may take in the future, will be sufficient to remediate the internal control deficiencies that led to our material weakness, that the material weakness will be remediated on a timely basis, or that additional material weaknesses will not be identified in the future. If the steps we take do not remediate the outstanding material weakness in a timely manner, there could continue to be a possibility that these control deficiencies or others could result in a material misstatement of our annual or interim consolidated financial statements. Further, our current internal control over financial reporting and any additional internal control over financial reporting that we develop may become inadequate because of changes in conditions in our business. We also cannot assure you that a material weakness will not be discovered with respect to a prior period for which we had previously believed that internal controls were effective. If we are not able to remediate this existing material weakness and document effective internal control over financial reporting, our independent registered public accounting firm will not be able to certify as to the effectiveness of our internal control over financial reporting, if and when required. Matters affecting our internal controls, including the material weakness describe above, may cause us to be unable to report our financial information on a timely basis, or may cause us to restate previously issued financial information, and thereby subject us to adverse regulatory consequences, including sanctions or investigations by the SEC, violations of applicable stock exchange listing rules, and litigation brought by our shareholders and others. There could also be a negative reaction in the financial markets due to a loss of investor confidence in us and the reliability of our financial statements. This could have a material and adverse effect on us by, for example, leading to a decline in our share price and impairing our ability to raise additional capital, and also could result in litigation brought by our shareholders and others. Certain provisions in our amended and restated certificate of incorporation and amended and restated bylaws, and of Delaware law, may prevent or delay an acquisition of Consensus, which could decrease the trading price of our common stock. Our amended and restated certificate of incorporation and amended and restated bylaws contain, and Delaware law contains, provisions that are intended to deter coercive takeover practices and inadequate takeover bids and to encourage prospective acquirers to negotiate with our board of directors rather than to attempt a hostile takeover. These provisions will, among other things: permit our Board of Directors to issue one or more series of preferred stock with such powers, rights and preferences as the Board of Directors shall determine; subject to a five-year sunset from the date of the distribution, provide for a classified Board of Directors, with each class serving a staggered three-year term, which could have the effect of making the replacement of incumbent directors more time consuming and difficult; provide that, as long as our Board of Directors is classified, our directors can be removed for cause only; prohibit stockholder action by written consent; limit the ability of stockholders to call a special meeting of stockholders; Table of Contents Manage certain risks inherent to our business, such as costs associated with fraudulent activity, system failure or network security breach; effectively maintain and manage our billing systems; allocate time and resources required to manage our legal proceedings; or adhere to our internal controls and procedures; Compete with other similar providers with regard to price, service and functionality; Cost-effectively procure, retain and deploy large quantities of fax numbers in desired locations in the United States and abroad; Achieve business and financial objectives in light of burdensome domestic and international telecommunications, Internet or other regulations including data privacy, security and retention; Successfully manage our growth, including but not limited to our operational and personnel-related resources, and integration of newly acquired businesses; Successfully adapt to technological changes and diversify services and related revenues at acceptable levels of financial return; Successfully develop and protect our intellectual property, both domestically and internationally, including our brands, patents, trademarks and domain names, and avoid infringing upon the proprietary rights of others; and Recruit and retain key personnel. S-v Table of Contents provide that vacancies on the Board of Directors could be filled only by a majority vote of directors then in office, even if less than a quorum, or by a sole remaining director; and establish advance notice requirements for stockholder proposals and nominations of candidates for election as directors. These provisions may prevent or discourage attempts to remove and replace incumbent directors. In addition, these limitations may adversely affect the prevailing market price and market for our common stock if they are viewed as limiting the liquidity of our stock or discouraging takeover attempts in the future. Because we have not chosen to be exempt from Section 203 of the Delaware General Corporation Law ( DGCL ), this provision could also delay or prevent a change of control that stockholders may favor. Section 203 provides that, subject to limited exceptions, persons that acquire, or are affiliated with a person that acquires, more than 15% of the outstanding voting stock of a Delaware corporation shall not engage in any business combination with that corporation, including by merger, consolidation or acquisitions of additional shares, for a three-year period following the date on which that person or their affiliates becomes the holder of more than 15% of the corporation s outstanding voting stock. In addition, an acquisition or further issuance of our common stock could trigger the application of Section 355(e) of the Code, causing the distribution to be taxable to Ziff Davis. Under the tax matters agreement, we would be required to indemnify Ziff Davis for the resulting tax, and this indemnity obligation might discourage, delay or prevent a change of control that you may consider favorable. Our amended and restated bylaws designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, and the United States federal district courts as the exclusive forum for claims under the Securities Act, which could limit our stockholders ability to obtain what such stockholders believe to be a favorable judicial forum for disputes with us or our directors, officers or employees. Our amended and restated bylaws provide that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (a) any derivative action or proceeding brought on behalf of Consensus, (b) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer or other employee, agent or stockholder of Consensus to Consensus or its stockholders, (c) any action asserting a claim against Consensus or any current or former director, officer or other employee of Consensus arising pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (d) any action asserting a claim against Consensus or any current or former director, officer or other employee of Consensus governed by the internal affairs doctrine shall, in each case to the fullest extent permitted by law, be the Court of Chancery of the State of Delaware, or if such court does not have subject matter jurisdiction, a the federal district court for the District of Delaware. Furthermore, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act or the rules or regulations thereunder. Our exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Exchange Act or the rules and regulations thereunder, and investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. These exclusive provisions may limit a stockholder s ability to bring a claim in a judicial forum that he, she or it believes to be favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits. It is possible that a court could find these exclusive forum provisions inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, and we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially adversely affect our business, financial condition and results of operations and result in a diversion of the time and resources of our management and board of directors. Table of Contents If securities or industry analysts do not publish research or publish misleading or unfavorable research about our business, our stock price and trading volume could decline. The trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about us or our business. We currently have five research analysts covering our common stock. If one or more of the analysts downgrades our stock or publishes misleading or unfavorable research about our business, our stock price would likely decline. If one or more of the analysts ceases coverage of our common stock or fails to publish reports on us regularly, demand for our common stock could decrease, which could cause our common stock price or trading volume to decline. Table of Contents CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS This prospectus, any accompanying prospectus supplement, the documents incorporated by reference into this prospectus, and other written or oral statements that we make from time to time contain, or will contain, certain forward-looking statements regarding business strategies, market potential, future financial performance and other matters. The words will, should, believe, expect, anticipate, project and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made. The matters discussed in these forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those projected, anticipated or implied in the forward-looking statements. You should read this prospectus, and any accompanying prospectus supplement, as well as our 2021 Form 10-K and our First Quarter 2022 Form 10-Q, which are each incorporated by reference herein, completely and with the understanding that actual future results may be materially different from expectations. All forward-looking statements made in this prospectus, any accompanying prospectus supplement and the documents incorporated or deemed to be incorporated by reference herein or therein are qualified by these cautionary statements. In particular, information included in this prospectus, any accompanying prospectus supplement or the documents incorporated by reference into this prospectus under headings such as Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and Business contain forward-looking statements. Where, in any forward-looking statement, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of our management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. Any forward-looking statement speaks only as of the date on which it is made. Except as may be required by law, we undertake no obligation to modify or revise any forward-looking statements to reflect events or circumstances occurring after the date of this information statement. Factors that could cause actual results or events to differ materially from those anticipated include, but are not limited to, the matters described in this prospectus, any accompanying prospectus supplement or the documents incorporated by reference into this prospectus under headings such as Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Some factors that could cause actual results to differ materially from those anticipated in these forward-looking statements include, but are not limited to, our ability and intention to: Sustain growth or profitability, particularly in light of an uncertain U.S. or worldwide economy and the related impact on customer acquisition and retention rates, customer usage levels and credit and debit card payment declines; Maintain and increase our customer base and average revenue per user; Generate sufficient cash flow to make interest and debt payments and reinvest in our business, and pursue desired activities and businesses plans while satisfying restrictive covenants relating to debt obligations; Acquire businesses on acceptable terms and successfully integrate and realize anticipated synergies from such acquisitions; Continue to expand our Cloud Fax business and operations internationally in the wake of numerous risks, including adverse currency fluctuations, difficulty in staffing and managing international operations, higher operating costs as a percentage of revenues or the implementation of adverse regulations; Maintain our financial position, operating results and cash flows in the event that we incur new or unanticipated costs or tax liabilities, including those relating to federal and state income tax and indirect taxes, such as sales, value-added and telecommunication taxes; Accurately estimate the assumptions underlying our effective worldwide tax rate; Table of Contents Manage certain risks inherent to our business, such as costs associated with fraudulent activity, system failure or network security breach; effectively maintain and manage our billing systems; allocate time and resources required to manage our legal proceedings; or adhere to our internal controls and procedures; Compete with other similar providers with regard to price, service and functionality; Cost-effectively procure, retain and deploy large quantities of fax numbers in desired locations in the United States and abroad; Achieve business and financial objectives in light of burdensome domestic and international telecommunications, Internet or other regulations including data privacy, security and retention; Successfully manage our growth, including but not limited to our operational and personnel-related resources, and integration of newly acquired businesses; Successfully adapt to technological changes and diversify services and related revenues at acceptable levels of financial return; Successfully develop and protect our intellectual property, both domestically and internationally, including our brands, patents, trademarks and domain names, and avoid infringing upon the proprietary rights of others; and Recruit and retain key personnel. Table of Contents USE OF PROCEEDS This prospectus relates to shares of our common stock that may be offered and sold from time to time by the selling stockholder or its permitted transferees. We will receive no proceeds from the sale of shares of common stock by Ziff Davis in this offering because those shares will be sold for the account of the selling stockholder or its permitted transferees. Table of Contents MARKET PRICE OF OUR COMMON STOCK AND DIVIDEND POLICY Market Price of Our Common Stock Our common stock is listed on Nasdaq under the symbol CCSI. On June 6, 2022, the closing price of our common stock was $48.23. As of June 6, 2022, there were 20,015,370 shares of our common stock outstanding, held of record by 178 holders. Dividend Policy We have never declared nor paid any cash dividends on our capital stock. We currently expect to retain all available funds and any future earnings for use in the operation and expansion of our business. We have no present intention to pay cash dividends on our common stock. Any determination to pay dividends to holders of our common stock will be at the discretion of our board of directors and will depend upon many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in our existing and any future debt and other factors that our board of directors deems relevant. Table of Contents SELLING STOCKHOLDER The selling stockholder under this prospectus is Ziff Davis, Inc. ( Ziff Davis ). Ziff Davis, has, to our knowledge, sole investment power with respect to such securities. Pursuant to a Stockholder and Registration Rights Agreement by and between us and Ziff Davis, Ziff Davis granted us a proxy to vote the shares of our common stock owned by Ziff Davis in proportion to the votes cast by our other stockholders. As a result, Ziff Davis does not exercise voting power over any of the shares of our common stock that it beneficially owns. We understand that Ziff Davis may dispose of any or all of our common stock that it retained after the separation and distribution through one or more subsequent exchanges for debt in accordance with the terms of the IRS private letter ruling received by Ziff Davis in connection with the separation and distribution. Under such an exchange, the debt exchange parties, as principals for their own accounts, would exchange debt obligations of the selling stockholder held by the debt exchange parties for shares of our common stock held by the selling stockholder. Under U.S. federal securities laws, the debt exchange parties would be deemed to be the selling stockholders and underwriters with respect to any shares of our common stock that they acquire in connection with a debt-for-equity exchange and sell in an offering in connection therewith. In the event that the debt exchange parties offer shares of our common stock for sale in connection with a debt-for-equity exchange, Ziff Davis may also be deemed a selling stockholder in such an offering solely for U.S. federal securities laws purposes. As of June 6, 2022, 20,015,370 shares of our common stock are issued and outstanding. The information concerning the beneficial ownership of shares of common stock by the selling stockholder included in this prospectus has been obtained from the selling stockholder. The shares held by the selling stockholder reflected in the table below may be sold by the selling stockholder from time to time in one or more offerings described in this prospectus and any applicable prospectus supplement. The selling stockholder may sell all, some or none of the shares of common stock beneficially owned by it, and therefore we cannot estimate either the number or the percentage of ordinary shares that will be beneficially owned by the selling stockholder following any offering or sale hereunder. Name of Beneficial Owner Number of Shares of our Common Stock Beneficially Owned Percentage of our Common Stock Outstanding Ziff Davis, Inc. 3,960,607 19.8 % The address of Ziff Davis, Inc. is 114 5th Avenue, New York, New York 10011. For information regarding certain material relationships between the selling stockholder and the Company, see Certain Relationships and Related Person Transactions incorporated by reference from our 2022 proxy statement into our 2022 Form 10-K incorporated by reference into this prospectus. Table of Contents DESCRIPTION OF CAPITAL STOCK The following is a summary of the material terms of our capital stock contained in our amended and restated certificate of incorporation and amended and restated bylaws. The summaries and descriptions below do not purport to be complete statements of the relevant provisions of our certificate of incorporation or our bylaws. The summary is qualified in its entirety by reference to such documents, which you must read (along with the applicable provisions of Delaware law) for complete information on our capital stock. Our certificate of incorporation and bylaws are included as exhibits to the registration statement of which this prospectus forms a part. General Our authorized capital stock consists of 120,000,000 shares of common stock, par value $0.01 per share and 5,000,000 shares of preferred stock, par value $0.01 per share. Our Board of Directors may establish the rights and preferences of the preferred stock from time to time. As of June 6, 2022, we had 20,015,370 shares of our common stock issued and outstanding and no shares of preferred stock issued and outstanding. Common Stock Each holder of our common stock is entitled to one vote for each share on all matters to be voted upon by the holders of our common stock, and there are no cumulative voting rights. Subject to any preferential rights of any outstanding preferred stock, holders of our common stock are entitled to receive ratably the cash dividends, if any, as may be declared from time to time by our Board of Directors out of funds legally available for that purpose. If there is a liquidation, dissolution or winding up of Consensus, holders of our common stock are entitled to ratable distribution of its assets remaining after the payment in full of liabilities and any preferential rights of any then-outstanding preferred stock. Holders of our common stock have no preemptive or conversion rights or other subscription rights, and there are no redemption or sinking fund provisions applicable to the common stock. All outstanding shares of our common stock are fully paid and non-assessable. The rights, preferences and privileges of the holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock that we may designate and issue in the future. Preferred Stock Under the terms of our amended and restated certificate of incorporation, our Board of Directors is authorized, subject to limitations prescribed by the DGCL and by our amended and restated certificate of incorporation, to issue preferred stock in one or more series without further action by the holders of its common stock. Our Board of Directors have the discretion, subject to limitations prescribed by the DGCL and by our amended and restated certificate of incorporation, to determine the designations and the powers, preferences and rights, and the qualifications, limitations and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock. Certain provisions of the tax matters agreement between us and Ziff Davis, which are intended to preserve the intended tax treatment of the separation and certain related transactions, may prevent certain issuances of our stock for a period of time following the completion of the distribution. See Certain Relationships and Related Person Transactions Tax Matters Agreement incorporated by reference from our 2022 proxy statement into our 2021 Form 10-K, which is incorporated by reference into this prospectus. Anti-Takeover Effects of Various Provisions of Delaware Law and Our Certificate of Incorporation and Bylaws Certain provisions in our proposed amended and restated certificate of incorporation and our proposed amended and restated bylaws summarized below may be deemed to have an anti-takeover effect and may delay, Table of Contents deter or prevent a tender offer or takeover attempt that a stockholder might consider to be in its best interests, including attempts that might result in a premium being paid over the market price for the shares held by stockholders. These provisions are intended to enhance the likelihood of continuity and stability in the composition of our Board of Directors and in the policies formulated by our Board of Directors and to discourage certain types of transactions that may involve an actual or threatened change of control. Classified Board. Our amended and restated certificate of incorporation provides that, until the annual stockholder meeting in 2026, our Board of Directors will be divided into three classes, with each class consisting, as nearly as may be possible, of one-third of the total number of directors. The directors designated as Class I directors have terms expiring at the first annual meeting of stockholders following the distribution, which is scheduled for June 15, 2022, and will be up for re-election at that meeting for a three-year term to expire at the 2025 annual meeting of stockholders; the directors designated as Class II directors have terms expiring at the following year s annual meeting of stockholders, which we expect to hold in 2023, and will be up for re-election at that meeting for a three-year term to expire at the 2026 annual meeting of stockholders; and the directors designated as Class III directors have terms expiring at the following year s annual meeting of stockholders which we expect to hold in 2024, and will be up for re-election at that meeting for a two-year term to expire at the 2026 annual meeting of stockholders. Commencing with the 2023 annual meeting of stockholders, directors elected to succeed those directors whose terms then expire will be elected for a term of office to expire at the 2026 annual meeting. Beginning at the 2026 annual meeting, all of our directors will stand for election each year for annual terms, and our Board will thereafter no longer be divided into three classes. Before our Board of Directors is declassified, it would take at least two years after the completion of the distribution for any individual or group to gain control of our Board of Directors. Accordingly, while the Board of Directors is divided into classes, these provisions could discourage a third party from initiating a proxy contest, making a tender offer or otherwise attempting to control us. Removal and Vacancies. Our amended and restated certificate of incorporation provides that (i) prior to our Board of Directors being declassified as discussed above, our stockholders may remove directors only for cause and (ii) after our Board of Directors has been fully declassified, our stockholders may remove directors with or without cause. Removal will require the affirmative vote of holders of at least a majority of our outstanding shares entitled to vote on such removal. Vacancies occurring on the Board of Directors, whether due to death, resignation, removal, retirement, disqualification or for any other reason, and newly created directorships resulting from an increase in the authorized number of directors, shall be filled solely by a majority of the remaining members of the Board of Directors or by a sole remaining director. Blank Check Preferred Stock. Our amended and restated certificate of incorporation authorizes our Board to designate and issue, without any further vote or action by the stockholders, up to 5,000,000 shares of preferred stock from time to time in one or more series and, with respect to each such series, to fix the number of shares constituting the series and the designation of the series, the voting powers (if any) of the shares of the series, and the preferences and relative, participating, optional and other rights, if any, and any qualifications, limitations or restrictions, of the shares of such series. The ability to issue such preferred stock could discourage potential acquisition proposals and could delay or prevent a change in control. No Stockholder Action by Written Consent. Our amended and restated certificate of incorporation expressly excludes the right of our stockholders to act by written consent. Stockholder action must take place at an annual meeting or at a special meeting of our stockholders. Stockholder Ability to Call Special Meetings of Stockholders. Our amended and restated bylaws provides that the Chairman of the Board, if any, the Vice Chairman of the Board, if any, the Chief Executive Officer or the Board of Directors is able to call a special meeting of stockholders, and also provides that a special meeting of stockholders may also be called by our Corporate Secretary upon the written request of stockholders who together own of record a majority of the outstanding shares of each class of stock entitled to vote at such meeting. Such request must be in proper written form, setting forth certain information, as required by our Table of Contents amended and restated bylaws, and signed by each stockholder, or a duly authorized agent of such stockholder, requesting the special meeting. Requirements for Advance Notification of Stockholder Nominations and Proposals. Our amended and restated bylaws requires stockholders seeking to nominate persons for election as directors at an annual or special meeting of stockholders, or to bring other business before an annual or special meeting (other than a proposal submitted under Rule 14a-8 under the Exchange Act), to provide timely notice in writing. A stockholder s notice to our Corporate Secretary must be in proper written form and must set forth certain information, as required under our amended and restated bylaws, related to the stockholder giving the notice, the beneficial owner (if any) on whose behalf the nomination is made as well as their control persons and information about the proposal or nominee for election to the Board of Directors. Exclusive Forum. Our amended and restated bylaws provide that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (a) any derivative action or proceeding brought on behalf of Consensus, (b) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer or other employee, agent or stockholder of Consensus to Consensus or its stockholders, (c) any action asserting a claim against Consensus or any current or former director, officer or other employee of Consensus arising pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (d) any action asserting a claim against Consensus or any current or former director, officer or other employee of Consensus governed by the internal affairs doctrine shall, in each case to the fullest extent permitted by law, be the Court of Chancery of the State of Delaware, or if such court does not have subject matter jurisdiction, a the federal district court for the District of Delaware. Furthermore, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act or the rules or regulations thereunder. Our exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Exchange Act or the rules and regulations thereunder, and investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. It is possible that a court could find our exclusive forum provision to be inapplicable or unenforceable. Although we believe this provision benefits us by providing increased consistency in the application of law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against our directors and officers. Business Combinations with Interested Stockholder. We are subject to Section 203 of the DGCL, which, subject to certain exceptions, prohibits a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years following the date that such stockholder became an interested stockholder. Limitations on Liability, Indemnification of Officers and Directors and Insurance Our amended and restated bylaws generally provide indemnification and advancement of expenses for our directors and officers to the fullest extent permitted by the DGCL. In addition, as permitted by Delaware law, our amended and restated certificate of incorporation includes a provision that eliminates the personal liability of our directors for monetary damages resulting from breaches of certain fiduciary duties as a director. The effect of this provision is to restrict our rights and the rights of our stockholders in derivative suits to recover monetary damages against a director for breach of fiduciary duties as a director, except that under Delaware law, we may not eliminate the personal liability of a director for: any breach of his duty of loyalty to us or our stockholders; acts or omissions not in good faith, or which involve intentional misconduct or a knowing violation of law; unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or Table of Contents any transaction from which the director derived an improper personal benefit; or improper distributions to stockholders. Listing Our shares of common stock are listed on the Nasdaq under the symbol CCSI. Transfer Agent and Registrar The transfer agent and registrar for our common stock is Computershare Trust Company, N.A. Table of Contents PLAN OF DISTRIBUTION The selling stockholder identified in this prospectus may offer, from time to time, up to an aggregate of 3,960,607 shares of our common stock. We are registering such shares under the terms of a stockholder and registration rights agreement between us and Ziff Davis. We will not receive any of the proceeds from the sale of shares of our common stock by the selling stockholder. We are not selling any shares of our common stock under this prospectus. The selling stockholder and its successors, including its transferees, may sell all or a portion of the shares of our common stock directly to purchasers or through underwriters, broker-dealers or agents, who may receive compensation in the form of discounts, concessions or commissions from the selling stockholders or the purchasers of the shares. These discounts, concessions or commissions as to any particular underwriter, broker-dealer or agent may be in excess of those customary in the types of transactions involved. The shares of our common stock may be sold in one or more transactions on any national securities exchange or quotation service on which the shares may be listed or quoted at the time of sale, in the over-the-counter market or in transactions otherwise than on these exchanges or systems or in the over-the-counter market and in one or more transactions at fixed prices, at prevailing market prices at the time of sale, at varying prices determined at the time of sale or at negotiated prices. These sales may be effected in transactions, which may involve crosses or block transactions. Additionally, the selling stockholders may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. The selling stockholders may use any one or more of the following methods when selling shares: on any national securities exchange or quotation service on which the shares may be listed or quoted at the time of sale, including, Nasdaq in the case of the common stock; in the over-the-counter market; in transactions otherwise than on these exchanges or services or in the over-the-counter market; through the writing or settlement of options or other hedging transactions, whether the options are listed on an options exchange or otherwise; ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; purchases by a broker-dealer as principal and resale by the broker-dealer for its account; an exchange distribution in accordance with the rules of the applicable exchange; a debt-for-equity exchange; privately negotiated transactions; settlement of short sales entered into after the effective date of the registration statement of which this prospectus forms a part; broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share; a combination of any such methods of sale; and any other method permitted pursuant to applicable law. In addition, any securities that qualify for sale pursuant to Rule 144 or Regulation S under the Securities Act or under Section 4(a)(1) of the Securities Act may be sold under such rules rather than pursuant to this Table of Contents prospectus or a prospectus supplement, subject to any restriction on transfer contained in the stockholder and registration rights agreement between us and Ziff Davis. If the selling stockholder uses an underwriter or underwriters for any offering, we will name them, and set forth the terms of the offering, in a prospectus supplement pertaining to such offering and, except to the extent otherwise set forth in such prospectus supplement, the selling stockholder will agree in an underwriting agreement to sell to the underwriters, and the underwriters will agree to purchase from the selling stockholder, the number of shares of our common stock set forth in such prospectus supplement. Any such underwriters may offer the shares of our common stock from time to time for sale in one or more transactions on Nasdaq, in the over-the-counter market, through negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices. The underwriters may also propose initially to offer the shares of our common stock to the public at a fixed public offering price set forth on the cover page of the applicable prospectus supplement. The underwriters may be granted an option, exercisable for 30 days after the date of the applicable prospectus supplement, to purchase additional shares from the selling stockholder. In connection with an underwritten offering, we, our directors and officers, and/or other holders of our common stock may agree with the underwriters, subject to certain exceptions, not to dispose of or hedge any common stock or securities convertible into or exchangeable for shares of common stock for a period of time after such offering. We will file a post-effective amendment to the registration statement of which this prospectus is a part to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. In connection with an underwritten offering, the underwriters may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of shares than they are required to purchase in the offering, and a short position represents the amount of such sales that have not been covered by subsequent purchases. A covered short position is a short position that is not greater than the amount of additional shares for which the underwriters option described above may be exercised. The underwriters may cover any covered short position by either exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to cover the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase additional shares pursuant to the option described above. Naked short sales are any short sales that create a short position greater than the amount of additional shares for which the option described above may be exercised. The underwriters must cover any such naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of various bids for or purchases of common stock made by the underwriters in the open market prior to the consummation of the offering. The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions. If the selling stockholder disposes of the shares of our common stock through a debt-for-equity exchange, it is expected that the selling stockholder and the debt exchange parties will enter into an exchange agreement. Under the exchange agreement, subject to certain conditions, the debt exchange parties, as principals for their own accounts, will exchange debt obligations of the selling stockholder held by the debt exchange parties for shares of our common stock held by the selling stockholder. The amount of indebtedness of the selling stockholder held by the debt exchange parties is expected to be sufficient to acquire all of the shares of our common stock to be sold. Under U.S. federal securities laws, the debt exchange parties will be deemed to be the Table of Contents selling stockholders and underwriters with respect to any shares of common stock that they acquire in connection with a debt-for-equity exchange and sell in an offering in connection therewith. In the event that the selling stockholders are offering shares for sale in connection with a debt-for-equity exchange, Ziff Davis may also be deemed a selling stockholder in such offering solely for U.S. federal securities laws purposes. References to the selling stockholder shall also be deemed to apply to the debt exchange parties in the event of a debt-for-equity exchange, as described herein. The selling stockholder may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the shares of our common stock in the course of hedging the positions they assume. The selling stockholder may also sell short the shares and deliver common stock to close out short positions, or loan or pledge the shares to broker-dealers that in turn may sell these shares. The selling stockholder may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities that require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus and the applicable prospectus supplement, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus and the applicable prospectus supplement. The selling stockholder also may transfer and donate the shares in other circumstances in which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus and the applicable prospectus supplement. The aggregate proceeds to the selling stockholder from the sale of the shares of our common stock will be the purchase price of the shares less discounts and commissions, if any. In offering the shares of our common stock covered by this prospectus and the applicable prospectus supplement, the selling stockholder and any broker-dealers who execute sales for the selling stockholders may be deemed to be underwriters within the meaning of Section 2(a)(11) of the Securities Act in connection with such sales. Any profits realized by the selling stockholder and the compensation of any broker-dealer may be deemed to be underwriting discounts and commissions. Any selling stockholder who is an underwriter within the meaning of Section 2(a)(11) of the Securities Act will be subject to the prospectus delivery requirements of the Securities Act and may be subject to certain statutory and regulatory liabilities, including liabilities imposed pursuant to Sections 11, 12 and 17 of the Securities Act and Rule 10b-5 under the Exchange Act. In order to comply with the securities laws of certain states, if applicable, the shares of our common stock must be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states the shares may not be sold unless the shares are registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with. The anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of the shares of our common stock pursuant to this prospectus and the applicable prospectus supplement and to the activities of the selling stockholder. In addition, we will make copies of this prospectus and the applicable prospectus supplement available to the selling stockholder for the purpose of satisfying the prospectus delivery requirements of the Securities Act. To the extent applicable, Regulation M may also restrict the ability of any person engaged in the distribution of the common stock to engage in market-making activities with respect to the common stock. All of the foregoing may affect the marketability of the common stock and the ability of any person or entity to engage in market-making activities with respect to the common stock. There can be no assurance that the selling stockholder will sell any or all of the common stock registered pursuant to the registration statement of which this prospectus forms a part. At the time a particular offering of the shares is made, a prospectus supplement, if required, will be distributed, which will set forth the name of the selling stockholder, the aggregate amount of shares being offered and the terms of the offering, including, to the extent required, (1) the name or names of any underwriters, broker-dealers or agents, (2) any discounts, commissions and other terms constituting compensation from the selling stockholder and (3) any discounts, commissions or concessions allowed or reallowed to be paid to broker-dealers. Table of Contents We have agreed to indemnify the selling stockholder against certain liabilities, including certain liabilities under the Securities Act. We have also agreed, among other things, to bear substantially all expenses (other than underwriting discounts and certain fees) in connection with the registration and sale of the shares of our common stock covered by this prospectus and the applicable prospectus supplement. Agents and underwriters may be entitled to indemnification by us and the selling stockholders against certain liabilities, including liabilities under the Securities Act, or to contribution with respect to payments which the agents or underwriters may be required to make in respect thereof. Agents and underwriters and their respective affiliates may engage in transactions with, or perform services for us in the ordinary course of business for which they may receive customary fees and reimbursement of expenses. The estimated offering expenses payable by us, in addition to any underwriting discounts and certain fees that will be paid by the selling stockholder, will be described in the applicable prospectus supplement. Table of Contents CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS The following discussion is a summary of certain U.S. federal income tax consequences to Non-U.S. Holders (as defined below) of the purchase, ownership and disposition of our common stock offered by this prospectus, but does not purport to be a complete analysis of all potential U.S. federal income tax effects. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local or non-U.S. tax laws are not discussed. This discussion is based on the U.S. Internal Revenue Code of 1986, as amended, or the Code , Treasury Regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the U.S. Internal Revenue Service, or the IRS , in each case in effect as of the date hereof. These authorities may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect a Non-U.S. Holder. We have not sought and will not seek any rulings from the IRS regarding the matters discussed below. There can be no assurance the IRS or a court will not take a contrary position to that discussed below regarding the tax consequences of the purchase, ownership and disposition of our common stock. This discussion is limited to Non-U.S. Holders that acquire our common stock in this offering and hold it as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion does not address all U.S. federal income tax consequences relevant to a Non-U.S. Holder s particular circumstances, including the impact of the Medicare contribution tax on net investment income. In addition, it does not address consequences relevant to Non-U.S. Holders subject to special rules, including, without limitation: U.S. expatriates and former citizens or long-term residents of the United States; persons subject to the alternative minimum tax; persons holding our common stock as part of a hedge, straddle or other risk reduction strategy or as part of a conversion transaction or other integrated investment; banks, insurance companies, and other financial institutions; brokers, dealers or traders in securities or other persons that elect to use a mark-to-market method of accounting for their holdings in our common stock; controlled foreign corporations, passive foreign investment companies, and corporations that accumulate earnings to avoid U.S. federal income tax; partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes (and investors therein); tax-exempt entities or governmental entities; persons deemed to sell our common stock under the constructive sale provisions of the Code; persons who hold or receive our common stock pursuant to the exercise of any employee stock option or otherwise as compensation; tax-qualified retirement plans; qualified foreign pension funds as defined in Section 897(l)(2) of the Code and entities all of the interests of which are held by qualified foreign pension funds; persons that at any time own (or are deemed to own) or have (or are deemed to have) owned more than five percent (by vote or value) of our common stock (except to the extent specifically set forth below); and persons subject to special tax accounting rules as a result of any item of gross income with respect to the stock being taken into account in an applicable financial statement. Table of Contents If an entity treated as a partnership for U.S. federal income tax purposes holds our common stock, the tax treatment of a partner in the partnership will depend on the status of the partner, the activities of the partnership and certain determinations made at the partner level. Accordingly, partnerships considering an investment in our common stock and the partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them. THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. INVESTORS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF OUR COMMON STOCK ARISING UNDER OTHER U.S. FEDERAL (INCLUDING ESTATE OR GIFT TAXES) TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY. Definition of a Non-U.S. Holder For purposes of this discussion, a Non-U.S. Holder is any beneficial owner of our common stock that is neither a U.S. person nor an entity treated as a partnership for U.S. federal income tax purposes. A U.S. person is any person that, for U.S. federal income tax purposes, is or is treated as any of the following: an individual who is a citizen or resident of the United States; a corporation created or organized under the laws of the United States, any state thereof, or the District of Columbia; an estate, the income of which is subject to U.S. federal income tax regardless of its source; or a trust that (1) is subject to the primary supervision of a U.S. court and the control of one or more United States persons (within the meaning of Section 7701(a)(30) of the Code), or (2) has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes. Distributions Any distributions of cash or property on our common stock will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Amounts not treated as dividends for U.S. federal income tax purposes and generally any portion of a distribution that exceeds our current and accumulated earnings and profits, will constitute a return of capital and first be applied against and reduce a Non-U.S. Holder s adjusted tax basis in its common stock (determined separately with respect to each share of our common stock), but not below zero. Any excess will be treated as capital gain and will be treated as described below under Sale or Other Taxable Disposition. Subject to the discussion below on effectively connected income, dividends paid to a Non-U.S. Holder of our common stock will be subject to U.S. federal withholding tax at a rate of 30% of the gross amount of the dividends (or such lower rate specified by an applicable income tax treaty, provided the Non-U.S. Holder furnishes a valid IRS Form W-8BEN or W-8BEN-E (or other applicable documentation) certifying qualification for the lower treaty rate). A Non-U.S. Holder that does not timely furnish the required documentation, but that qualifies for a reduced treaty rate, may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS. Non-U.S. Holders should consult their tax advisors regarding their entitlement to benefits under any applicable income tax treaty and the availability of a refund on any excess U.S. federal tax withheld. If dividends paid to a Non-U.S. Holder are effectively connected with the Non-U.S. Holder s conduct of a trade or business within the United States, unless an applicable income tax treaty provides otherwise, the Table of Contents Non-U.S. Holder will be exempt from the U.S. federal withholding tax described above. To claim the exemption, the Non-U.S. Holder generally must furnish to the applicable withholding agent a valid IRS Form W-8ECI (or a suitable successor or substitute form), certifying that the dividends are effectively connected with the Non-U.S. Holder s conduct of a trade or business within the United States. Unless an applicable income tax treaty provides otherwise, any such effectively connected dividends generally will be subject to U.S. federal income tax on a net income basis at the regular graduated rates applicable to United States persons. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such Non-U.S. Holder s effectively connected earnings and profits, as adjusted for certain items. Non-U.S. Holders should consult their tax advisors regarding any applicable tax treaties that may provide for different rules. The foregoing discussion is subject to the discussion below under Information Reporting and Backup Withholding and Additional Withholding Tax on Payments Made to Foreign Accounts. Sale or Other Taxable Disposition Subject to the discussion below regarding backup withholding, a Non-U.S. Holder will not be subject to U.S. federal income tax on any gain recognized upon the sale or other taxable disposition of our common stock unless: the gain is effectively connected with the Non-U.S. Holder s conduct of a trade or business within the United States; the Non-U.S. Holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition and certain other requirements are met; or our common stock constitutes a U.S. real property interest, or USRPI, by reason of our status as a U.S. real property holding corporation, or USRPHC, for U.S. federal income tax purposes. Unless an applicable income tax treaty provides otherwise, gain described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular graduated rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such Non-U.S. Holder s effectively connected earnings and profits, as adjusted for certain items. Gain described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty), which may be offset by certain U.S. source capital losses of the Non-U.S. Holder (even though the individual is not considered a resident of the United States), provided the Non-U.S. Holder has timely filed U.S. federal income tax returns with respect to such losses. With respect to the third bullet point above, we believe we currently are not, and do not anticipate becoming, a USRPHC. However, because the determination of whether we are a USRPHC depends on the fair market value of our U.S. real property relative to the fair market value of our other business assets, there can be no assurance that we are not currently or will not become a USRPHC in the future. Even if we are or become a USRPHC, however, as long as our common stock is regularly traded (as defined by applicable Treasury Regulations) on an established securities market, such common stock will be treated as U.S. real property interests only if you actually or constructively hold more than 5% of our common stock at any time during the shorter of the five-year period preceding your disposition of, or your holding period for, our common stock so disposed. Non-U.S. Holders should consult their tax advisors regarding potentially applicable income tax treaties that may provide for different rules. Table of Contents Information Reporting and Backup Withholding Payments of dividends on our common stock will not be subject to backup withholding, provided the holder either certifies its non-U.S. status, such as by furnishing a valid IRS Form W-8BEN, W-8BEN-E, W-8ECI or other applicable IRS form, or otherwise establishes an exemption. However, information returns are required to be filed with the IRS in connection with any distributions on our common stock paid to the Non-U.S. Holder, regardless of whether any tax was actually withheld. In addition, proceeds of the sale or other taxable disposition of our common stock within the United States or conducted through a non-U.S. office of a U.S. broker or a non-U.S. broker with specified connections to the United States generally will not be subject to backup withholding or information reporting, if the applicable withholding agent receives the certification described above. Proceeds of a disposition of our common stock conducted through a non-U.S. office of a non-U.S. broker without specified connections to the United States generally will not be subject to backup withholding or information reporting. Copies of information returns that are filed with the IRS may also be made available under the provisions of an applicable treaty or agreement to the tax authorities of the country in which the Non-U.S. Holder resides or is established. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a Non-U.S. Holder s U.S. federal income tax liability, provided the required information is timely furnished to the IRS. Additional Withholding Tax on Payments Made to Foreign Accounts Withholding taxes may be imposed under Sections 1471 to 1474 of the Code and the rules and regulations promulgated thereunder (commonly referred to as the Foreign Account Tax Compliance Act, or FATCA) on certain types of payments made to non-U.S. financial institutions and certain other non-U.S. entities. Specifically, a 30% withholding tax may be imposed on dividends on our common stock paid to a foreign financial institution or a non-financial foreign entity (each as defined in the Code), regardless of whether such recipient is acting as an intermediary or a beneficial owner, unless (1) the foreign financial institution undertakes certain diligence and reporting obligations, (2) the non-financial foreign entity either certifies it does not have any substantial United States owners (as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (3) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in (1) above, it must enter into an agreement with the U.S. Department of the Treasury requiring, among other things, that it undertake to identify accounts held by certain specified United States persons or United States owned foreign entities (each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules. Under the applicable Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends on our common stock. Prospective investors should consult their tax advisors regarding the potential application of withholding under FATCA to their investment in our common stock. Table of Contents EXPERTS The consolidated financial statements and schedule as of December 31, 2021 and 2020 and for each of the three years in the period ended December 31, 2021 incorporated by reference in this Prospectus and in the Registration Statement have been so incorporated in reliance on the report of BDO USA, LLP, an independent registered public accounting firm, incorporated herein by reference, given on the authority of said firm as experts in auditing and accounting. Table of Contents LEGAL MATTERS The validity of the common stock being offered by this prospectus will be passed upon for us by Gibson, Dunn & Crutcher LLP. Ziff Davis is being represented in connection with any offering by Sullivan & Cromwell LLP. Certain legal matters in connection with any underwritten offering will be passed upon for the underwriters by Cahill Gordon & Reindel LLP. Table of Contents WHERE YOU CAN FIND MORE INFORMATION We have filed a registration statement on Form S-1 with the SEC under the Securities Act. This prospectus is part of the registration statement but the registration statement includes additional information and exhibits. We file annual, quarterly and special reports and other information with the SEC. The SEC maintains a website that contains reports, proxy and information statements and other information about issuers, such as us, who file electronically with the SEC. The address of that website is www.sec.gov. Our SEC filings are also available to the public free of charge on the investor relations portion of our website located at https://investor.consensus.com. Information on our website is not incorporated by reference herein and is not otherwise intended to be part of this prospectus. Table of Contents TABLE OF CONTENTS PROSPECTUS SUPPLEMENT Page About this Prospectus Supplement S-ii Industry and Market Data S-iii Trademarks, Tradenames and Service Marks S-iii Special Note Regarding Forward-Looking Statements S-iv Prospectus Supplement Summary S-1 The Offering S-5 Risk Factors S-8 Use of Proceeds S-9 Selling Stockholders S-10 Underwriting (Conflict of Interest) S-11 Experts S-24 Legal Matters S-24 Where You Can Find More Information S-24 PROSPECTUS About this Prospectus ii Prospectus Summary 1 The Offering 3 Risk Factors 4
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus, and does not contain all of the information that you should consider before investing in our securities. You should read this summary together with the entire prospectus, including our financial statements, the notes to those financial statements and the additional information described in this prospectus under the heading Where You Can Find More Information, before making an investment decision. See the Risk Factors section of this prospectus beginning on page 5 and in the documents incorporated by reference into this prospectus for a discussion of the risks involved in investing in our securities. Overview We develop, commercialize, and market a range of automated technologies for chimeric antigen receptor T ( CAR-T ) and other cell-based therapies. We currently market a full suite of solutions for automated clinical biobanking, point-of-care applications, and automation for immuno-oncology, including our semi-automated, functionally closed CAR-TXpress platform, which streamlines the manufacturing process for the emerging CAR-T immunotherapy market. The Company was founded in 1986 and is incorporated in the State of Delaware and headquartered in Rancho Cordova, CA. Medical Device Products for Automated Cell Processing We provide the AutoXpress and BioArchive platforms for automated clinical bio-banking, PXP platform for point-of-care cell-based therapies and CAR-TXpress platform for large scale cell manufacturing services. All product lines are reporting as a single reporting segment in the financial statements. We currently manufacture and market the following products: Clinical Bio-Banking Applications: AXP II Automated Cell Separation System an automated, fully closed cell separation system for isolating stem and progenitor cells from umbilical cord blood, registered as a U.S. FDA 510(k) medical device. BioArchive Automated Cryopreservation System an automated, robotic, liquid nitrogen controlled-rate-freezing and cryogenic storage system for cord blood samples and cell therapeutic products used in clinical applications, registered as a U.S. FDA 510(k) medical device. Point-of-Care Applications: PXP Point-of-Care System an automated, fully closed, sterile system allows for the rapid, automated processing of autologous peripheral blood or bone marrow aspirate derived stem cells at the point-of-care, such as surgical centers or clinics, registered as a U.S. FDA 510(k) medical device. PXP-LAVARE System an automated, fully closed system that is designed to wash, re-suspend and volume reduce cell suspensions. It allows for volume manipulation, supernatant or media exchange, and cell washing to occur without comprising cell viabilities and maximizing recoveries, registered as a U.S. FDA 510(k) medical device. PXP-1000 System an automated, fully closed system that provides fast, reproducible separation of multiple cellular components from blood with minimal red blood cell contamination, registered as a U.S. FDA 510(k) medical device. Large Scale Cell Processing and Biomanufacturing: X-Series Products for general laboratory use: X-Lab for cell isolation, X-Wash System for cell washing and reformulation, X-Mini for high efficiency small scale cell purification, and X-BACS System under development for large scale cell purification using our proprietary Buoyancy-Activated Cell Sorting ( BACS ) technology. CAR-TXpress Platform for Clinical Manufacturing a modular designed, functionally closed manufacturing platform that addresses the critical unmet need for large scale cellular processing and chemistry, manufacturing and controls ( CMC ) needs for manufacturing cellular therapies, including CAR-T cell therapies. Planned Expansion of Business-- Contract Development and Manufacturing Services for Cell and Cell-Based Gene Therapies In March 2022, our board of directors approved the planned expansion of our business to include contract development and manufacturing services for cell and cell-based gene therapies. We plan to develop and build-out the capabilities to become a world-class Contract Development and Manufacturing Organization ( CDMO ) for cell and cell-based gene therapies by partnering with Boyalife Genomics Tianjin Ltd., a China-based CDMO organization that is an affiliate our Chairman, President, and Chief Executive Officer ( Boyalife Genomics ), to in-license certain know-how and other intellectual property from Boyalife Genomics, and by leasing and building out a cell manufacturing facility in Sacramento, California. We intend to leverage our existing technology and combine it with the in-licensed technologies to develop a proprietary manufacturing platform for cell manufacturing activities. Amendment No. 3 to FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents We plan to develop and operate our planned CDMO business through a newly formed division named TG Biosynthesis . It is anticipated that TG Biosynthesis will provide high-quality development and manufacturing capabilities, cell and tissue processing development, quality systems, regulatory compliance, and other cell manufacturing solutions for clients with therapeutic candidates in various stages of development. According to a recent article published on Science Translational Medicine, cell therapies have become the next pillar of medicine . In 2017, US Food and Drug Administration (FDA) approved the first CAR-T cell therapy, Kymriah , for the treatment of acute lymphoblastic leukemia (ALL). The cellular drug demonstrated close to 90% response rate in the relapsed and refractory cancer patient group. By the end of 2021, FDA had approved five (5) CAR-T therapies for various forms of blood cancers, and globally there were over 1,200 registered CAR-T cell related clinical trials registered on the National Institute of Health (NIH) clinicaltrial.gov website, targeting a variety of blood and solid tumors. We believe that CDMO cell manufacturing services are becoming increasingly important for cell therapies to make their way through clinical trials. One of the major issues with moving cell therapy products from bench to bedside has been manufacturing bottlenecks. The heterogeneous nature of cell therapy products has introduced manufacturing complexity and regulatory concerns, as well as scale-up complexities that are not present within traditional pharmaceutical manufacturing. Additionally, establishing a manufacturing facility for cell therapies requires specific expertise and significant capital which can delay clinical trials. These factors often result in a significant number of cell therapy-based companies seeking CDMOs for their cell manufacturing needs. We believe that we can leverage our current proprietary automated and semi-automated cell processing technologies to more effectively develop CDMO capabilities. In furtherance of our planned CDMO business, on March 24, 2022, we entered into a License and Technology Access Agreement with Boyalife Genomics (the Boyalife License Agreement ). Boyalife Genomics is an affiliate of our Chairman and CEO, Dr. Chris Xu, and is a Tianjin, China-based cell manufacturing organization that has developed substantial manufacturing technology relating to cell manufacturing services. Under the terms of the Boyalife License Agreement, Boyalife Genomics granted the Company and its subsidiaries and affiliates a perpetual exclusive license in the United States to use Boyalife Genomics existing and future know-how and U.S. patents rights (if any) relating to cell manufacturing and related processes, including the right to sublicense such know-how and patent rights to our affiliates. Notwithstanding the foregoing exclusivity, Boyalife Genomics retains the right to use (but not license) the licensed intellectual property in the U.S. for its internal use in connection with the provision of products and services to third parties. In consideration of this license, we will, among other things, pay to Boyalife Genomics a running royalty of 7.5% of our annual net sales of products and services that are covered by one of more Boyalife Genomics granted U.S. patents and 5.0% of other products and services covered by the licensed intellectual property. The royalty will be payable on each licensed product or service for a period of 10 years from the first commercial sale of the product or service (or if patented, until the expiration of the applicable licensed patents), and the license will be royalty-free thereafter on such licensed product or service. The agreement also grants us a right of first refusal to purchase any cell manufacturing business or operation of Boyalife Genomics upon the same terms as any third-party offer to buy such business or operation. Also on March 24, 2022, we entered into a Lease Agreement (the CDMO Facility Lease ), with Z3 Investment LLC ( Lessor ) for approximately 35,475 square feet of space in the Sacramento, California area in which we plan to partner with the Lessor to build out into a state-of-the-art current good manufacturing practice (cGMP) compliant facility with 12 cGMP clean room suites (with the Lessor paying to the related build-out costs). The CDMO Facility Lease provides for a lease term beginning on April 1, 2022 and ending on September 30, 2027, with a right of the Company to extend the lease for 2 additional periods of 5 years each. Lessor is an affiliate of our Chairman and CEO, Dr. Xu. We are targeting the launch of our CDMO services to customers by the end of 2022. The successful development and launch of TG Biosynthesis will require us to raise additional capital, acquire various equipment for the planned operations, hire certain personnel needed to launch the operation, and timely complete the build-out of our leased Sacramento facility. There is no assurance that we will be able to successfully obtain such additional capital resources, as such capital may not be available on reasonable terms, or available at all. We will need to hire, train, and retain additional employees who have experiences in the cell manufacturing field in order for our CDMO business to be successful. Corporate Information We are a Delaware corporation with principal executive offices located at 2711 Citrus Road, Rancho Cordova, CA 95742. Our telephone number is (916) 858-5100 and our web site is www.thermogenesis.com. The information contained in, and that which can be accessed through, our website is not incorporated into and does not form a part of this prospectus. THERMOGENESIS HOLDINGS, INC. (Exact name of registrant as specified in its charter) Delaware 3821 94-3018487 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 2711 Citrus Road Rancho Cordova, California 95742 (916) 858-5100 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Jeffery Cauble Chief Financial Officer 2711 Citrus Road Rancho Cordova, California 95742 (916) 858-5100 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to:\ Curt P. Creely, Esq. Carolyn T. Long, Esq. Foley & Lardner LLP 100 North Tampa Street, Suite 2700 Tampa, Florida 33602 Phone: (813) 229-2300 Fax: (813) 221-4210 Jeffrey Fessler, Esq. Sheppard Mullin Richter & Hampton LLP 30 Rockefeller Plaza, 39th Floor New York, New York 10112 Phone: (212) 653-8700 Fax: (212) 653-8701 Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0000884650_infinite_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0000884650_infinite_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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@@ -0,0 +1,25 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary of the prospectus highlights material information concerning our business and this offering. This summary does not contain all
+of the information that you should consider before making your investment decision. You should carefully read the entire prospectus,
+including the information presented under the section entitled Risk Factors and the financial data and related notes, before
+making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results
+may differ significantly from future results contemplated in the forward-looking statements as a result of factors such as those set
+forth in Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. 
+
+ 
+
+In
+this prospectus, unless the context indicates otherwise, Sugarmade, the Company, we, our, 
+ ours or us refer to Sugarmade, Inc., a Delaware corporation, and its direct and indirect subsidiaries, including,
+but not limited to, Carryout Supplies and Lemon Glow Company, Inc. Dutchess Capital Growth Fund LP is referred to herein as Dutchess, 
+the Investor, and the Selling Securityholder. 
+
+ 
+
+This
+summary contains basic information about us and
\ No newline at end of file
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+PROSPECTUS SUMMARY
+ 
+This summary highlights information contained in greater detail elsewhere in this prospectus and may not contain all of the information that may be important to you in making an investment decision. You should read the entire prospectus, including this summary together with the more detailed information, including our financial statements and the related notes, elsewhere in this prospectus. You should carefully consider, among other things, the matters discussed in Risk Factors beginning on page 16 and Management s Discussion and Analysis of Financial Condition and Results of Operations. Unless otherwise stated or the context requires otherwise, references in this prospectus to Troika, the Company, we, us and our refer to Troika Media Group, Inc. and its consolidated subsidiaries.
+ 
+The Company
+Overview
+ 
+Troika Media Group, Inc. (the Company, TMG, we, us or our ) is a transformational consulting and solutions group that delivers resilient brand equity, amplifying brands through emerging technology and transcending them into culture to deliver performance driven business growth. The Company provides its performance driven solutions to B2C and B2B brands in the consumer products and services, entertainment and media, sports and sports betting, financial and professional, education and eSports and gaming sectors in the U.S., Europe, Middle East and Asia. The value propositions for the Company s clients are the outcomes that the Company delivers. The Company builds enterprise value for its partners, acquiring customers, retaining customers and architecting value based exit strategies for its clients. The Company executes its outcomes-based value proposition through the deployment of agile, creative, innovative technology and adaptive business intelligence engineered to deliver measurable strategic goals driving resilient value for its partners. The Company creates brands and businesses; connects them through emerging technologies and innovations, utilizing business intelligence to drive performance. 
+ 
+TMG s operating entities are: 
+ 
+Troika Services, Inc. a marketing innovation and emerging technology solutions group that transcends brands into engagement platforms, ecosystems and mediums such as NFTs, Web 3.0, augmented reality, virtual reality and measures the impact of brands for shareholders and consumers. During the fiscal year ended June 30, 2021 ( TMG Audited Fiscal Year Ended 2021 ), this operating unit accounted for approximately 1% of our revenues.
+ 
+Troika Design Group, Inc. - a strategic brand building and activation solutions group with deep expertise in entertainment, media, sports, and consumer goods and professional services brands. Troika provides a creative fan-centric approach to integrated brand strategy, creative, research, and technology solutions that builds long-term brand awareness for clients through equity and consumer loyalty. During Fiscal 2021, this operating unit accounted for approximately 40% of our revenues.
+ 
+MissionCulture LLC, Mission-Media Holdings Limited (London) and Mission Media USA Inc. (its non-operating subsidiary) (collectively, known as Mission ) London-headquartered brand experience and communications solution group that specializes in consumer immersion through a cultural lens, via live experiences, brand partnerships, public relations, including social and influencer engagement. During Fiscal 2021, this operating unit accounted for approximately 59% of our revenues.
+ 
+Troika IO, Inc. (f/k/a Redeeem LLC) - TroikaIO offers consultative and blockchain development services to activate its value proposition as an emerging technology strategy and solutions provider in the NFTs and Web3 world. TroikaIO leverages its Redeeem digital ecosystem to provide thought leadership in emerging technology and engagement strategies. During Fiscal 2021, this operating unit accounted for approximately 0% of our revenues.
+ 
+ 
+-3-
+
+Table of Contents
+ 
+The following table presents the disaggregation of above operating entities gross revenue between revenue streams:
+ 
+Revenue Stream
+ 
+Year Ended 
+June 30, 2021
+ 
+
+Project fees
+ 
+$6,418,000 
+
+Retainer fees
+ 
+$2,140,000 
+
+Fee income
+ 
+$3,581,000 
+
+Reimbursement income 
+ 
+$4,029,000 
+
+Other revenue
+ 
+$24,000 
+
+Total
+ 
+$16,192,000 
+
+ 
+On March 21, 2022, the Company completed the acquisition of Converge Direct, LLC (and its affiliates) (collectively referred to as Converge and Converge Acquisition ). 
+ 
+Converge is a customer acquisition and business intelligence solutions group servicing financial services, home improvement, professional services, education and entertainment brands. The Company provides performance marketing and lead generation solutions through a channel agnostic strategy powered by its proprietary business intelligence platform, Helix, and first party data marketing ecosystems. Converge has a dedicated focus on applied marketing intelligence, performance media execution, lead generation, digital and offline engagement activations and customer retention to create efficient and scalable customer acquisition outcomes, and higher customer lifetime value. 
+ 
+Converge recognizes primarily two (2) revenue streams which are (a) managed services and (b) performance marketing which during the year ended December 31, 2021 ( Converge Audited Fiscal Year Ended 2021 ) attributed $194.0 million and $99.5 million, respectively, or 66% and 34%, respectively. 
+ 
+Our corporate headquarters are in Los Angeles with operations in New York, New Jersey, California, and London, which allows the team of approximately 185 employees to directly service clients globally. In order to accelerate growth, we intend to attract a new era of growth clients and to extend integrated solutions to our existing roster of global brands. 
+ 
+Acquisition of Converge Direct, LLC
+ 
+On March 21, 2022 (the Closing Date ), the Company completed the acquisition of Converge Direct, LLC and affiliates (the Converge Acquisition ). The total purchase price for the Converge Acquisition is $125,000,000. The purchase price consists of one hundred million dollars ($100,000,000) in cash at closing. The remaining twenty-five million ($25,000,000) dollars was paid in the Company s restricted common stock valued at $2.00 per share. All 12,500,000 shares are subject to a nine (9) month lock-up. Pursuant to the provisions of the Membership Interest Purchase Agreement (the MIPA ) dated as of November 22, 2021, as amended, an aggregate of $2,500,000 (10%) or 1,250,000 shares of the common stock issued to the Sellers are held in escrow to secure against claims for indemnification. The escrowed shares shall be held until the later of (a) one year from the Closing Date, or (b) the resolution of indemnification claims. The Closing was conditioned upon the completion of a $75,000,000 debt financing with Blue Torch Capital, a direct lender having experience providing bespoke credit solutions. EF Hutton, division of Benchmark Investments LLC, acted as exclusive placement agent, and Cantor Fitzgerald & Co. acted as sole debt placement agent in connection with the transaction. There was no material relationship, other than in regard to the Converge Acquisition, between the Converge sellers and the Company or its affiliates, or any director or officer of the Company or any assignees of any such director or officer.
+ 
+Overview
+ 
+Converge is a leading independent managed service and performance marketing media buying agency. The Company provides complementary services such as advertising strategy and customized advertising campaigns utilizing their proprietary attribution analytics software tool, Helix. Converge has a dedicated focus on media buying, planning, strategy, data analytics and media execution. Converge uses data and marketing insights to help clients curate new customer ad campaigns at efficient costs, scale, and higher customer lifetime value. In all aspects of Converge s advertising activity it focuses on direct response marketing, maintaining a desired return on investment for its clients. The performance model aligns Converge with its client on their cost of marketing goals, reduces their marketing spend risk and affords Converge the flexibility to use its media channel knowledge and processes most efficiently, while enabling Converge to maximize its revenue with little friction. Converge buys media on behalf of its clients, provides advanced attribution tracking and reporting, and full campaign management and execution. Over the last four years, Converge started a dedicated performance marketing division, which is focused specifically on a performance pay model that tracks the action driven by media campaigns and receives compensation for these consumer actions.
+ 
+Converge s proprietary technology measures, tracks, ingests CRM (customer relationship management) data and reports performance information across media channels. It seamlessly incorporates data aggregation and mining from virtually any source enabling Converge s teams to perform granular level analysis, media optimization, and customer journey tracking. This service incentivizes Converge to provide the most effective strategies to its clients as opposed to more traditional methods such as retainer or commission basis.
+ 
+ 
+-4-
+
+Table of Contents
+ 
+Converge serves customers in various end markets: financial services, consumer products, healthcare and insurance, travel and leisure, education, media and entertainment, home improvement, fitness and wellbeing, and legal services among others. Converge services many well known public companies such as AT&T, AAA, Cricket Wireless, The Hartford, DirecTV, Great Wolf Resorts, Renewal by Andersen Windows, Leaf Filter (now Leaf Home), ADT, Wayfair and various law firms in the legal services sector. Converge s key clients have a longevity ranging from 5-15 years, with about 75% of Converge s revenues coming from clients with at least five year s retention. 
+ 
+Converge was formed in 2006 and is headquartered in Bedford Hills, New York with branch offices in New York City and San Diego, California. Converge serves clients throughout the U.S. Converge employs approximately 82 individuals through Extensis, their professional employer organization ( PEO ) company.
+ 
+Converge Highlights
+ 
+ 
+ 
+A data and audience centric media agency with responsibility for over $5 billion in media budgets since inception.
+
+ 
+ 
+ 
+
+ 
+ 
+Expertise in paid digital and traditional media buying: Search Engine Marketing, Display, Social, e Marketplaces, Connected TV, Affiliate platforms, as well as Print and Direct Mail media vehicles.
+
+ 
+ 
+ 
+
+ 
+ 
+Responsible for executing over 20 billion ad impressions a year.
+
+ 
+ 
+ 
+
+ 
+ 
+Exponents of data driven, hyper targeted ad serving and custom audience targeting with measurable media driving financial outcomes.
+
+ 
+ 
+ 
+
+ 
+ 
+Ability to identify and engage consumers and measure their interaction across multiple personal devices.
+
+ 
+ 
+ 
+
+ 
+ 
+Longstanding Google Premier Partner, Bing Elite Agency, and Facebook Marketing Partner.
+
+ 
+ 
+ 
+
+ 
+ 
+Deploy proprietary analytics platform Helix , to provide insights on marketing campaign performance, customer journey tracking and real time performance optimization tactics.
+
+ 
+ 
+ 
+
+ 
+ 
+Built a robust data aggregation platform to utilize applied analytics maximizing ad engagement and reduce wasted customer ad touchpoints across all channels.
+
+ 
+Converge Services
+ 
+ 
+ 
+Strategic Media Planning
+
+ 
+ 
+ 
+
+ 
+ 
+Brand and Direct Response New Customer Acquisition
+
+ 
+ 
+ 
+
+ 
+ 
+Digital and Traditional Media Buying and Optimization
+
+ 
+ 
+ 
+
+ 
+ 
+Local and National Media Targeting
+
+ 
+ 
+ 
+
+ 
+ 
+Marketing Intelligence Performance Tracking Ingests data from other AdTech platforms
+
+ 
+ 
+ 
+
+ 
+ 
+Data Analytics and Customer Journey Data Aggregation and Insight
+
+ 
+ 
+ 
+
+ 
+ 
+Procurement of all marketing elements to achieve turnkey campaigns.
+
+ 
+ 
+-5-
+
+Table of Contents
+ 
+Converge Overarching Philosophy
+ 
+In today s ad space, data is of premier importance and speed to react on this data is one of the most essential elements of successful marketing. Converge is a marketing analytic driven company using data and buying models to inform its media targeting and buying decisions. Marketing decisions are implemented against both online and offline traditional media channels at predictable and scalable levels to meet clients costs of marketing goals. Converge s ideal client is one where they work in concert, leverages its strengths to marrying their customer data sets, with Converge s media buying performance activities creating true performance marketing campaigns, that once proven out through test cohorts, can be forecasted, and scaled to meet client growth goals.
+ 
+Troika Rebranding
+ 
+The Company changed its name to Troika Media Group, Inc. following the Troika Merger in June 2017 to continue to develop the Troika brand name and reputation in the media and design space. The names of the Company s operating subsidiaries were also changed to reflect the new branding of the entire Company. We believe that this streamlined branding will allow for better name recognition, as well as helping cross-sell our various services to our existing customers.
+ 
+Through its subsidiaries, Troika Media Group, Inc. provides the following services:
+ 
+ 
+ 
+Media Services and Analytics Platform
+
+ 
+ 
+Digital Marketing, Data Analytics and Reporting
+
+ 
+ 
+Media Content for events and hospitality customers
+
+ 
+ 
+Sponsorship partnerships and advertising opportunities.
+
+ 
+ 
+Expert in Analytics and Big Data; reputation for technology, innovation and affordability
+
+ 
+ 
+Strategic media buying and planning
+
+ 
+ 
+Design and Branding
+
+ 
+ 
+Market Research and Insights
+
+ 
+ 
+Brand Strategy
+
+ 
+ 
+360 Brand Design
+
+ 
+ 
+Advertising Creative and Sponsorship Integration
+
+ 
+ 
+Design, Animation and Post Production Studio
+
+ 
+ 
+Live-Action Production LLC
+
+ 
+ 
+Brand Experience and Fan Engagement
+
+ 
+ 
+Content Creation
+
+ 
+ 
+Sonic Branding and Original Music
+
+ 
+ 
+A peer-to-peer exchange to build non-fungible tokens (NFTs)
+
+ 
+Business Strategy 
+ 
+We continue to execute on all aspects of our business, including our digital technology and media business serving the sports, entertainment and convention center market. We have found that truly successful businesses find ways of taking fixed assets and generating multiple revenue opportunities over those fixed assets, preferably on a contractual monthly recurring revenue or retainer model, thereby improving profitability. The Troika brand brings media and design expertise and experience with a proven track record of success in major brand identity and development projects boasting some of the premier names in the sports and entertainment industries. 
+ 
+We consider our digital technology and media services to be our high growth business. The Troika brand gives the Company in-house, design, content inventory, research and branding services allowing us to bring a suite of engagement services to our clients and making us a one stop shop for digital media needs. The new strategic design for the Company combines brand, marketing and fan engagement services provided by Troika with a mobile connectivity and advertising platform provided by Troika Services, Inc. Together, they offer solutions for engaging audiences and fans through various channels. 
+ 
+ 
+-6-
+
+Table of Contents
+ 
+Troika s operating subsidiaries generally provide three different service offerings, all in the same business segment: (1) design and brand identity; (2) media content/data analytics and advertising; and (3) platform and intellectual property development, all of which together provide a comprehensive solution for business and media partners.
+ 
+Management believes based on its knowledge of the industry at this stage of digital evolution, the market needs a new breed of a modern agency using open web-first approach to take the power and control out of walled gardens, such as Google, Facebook and Amazon, hands and put it back into the hands of marketers, where it belongs. Today, walled gardens intensives are not aligned with marketer s success.
+ 
+Management believes that holding companies such as GroupM, Publicis, IPG, Dentsu are struggling with baggage, distractions and broken financial models. Our strategy removes value from working media, which is often the most expensive thing a marketer pays for, in automated digital environments and do not help with the walled garden problem.
+ 
+A modern agency not only has to be fully transparent and laser focused on applying data and technology to put control and leverage back in the hands of the marketer with a cross audience strategy, addressable media planning and activation. We need to have world class personalized creativity, with a financial model that allows it to provide highest level of expert service and technology without a need to up-sell useless features. This is our plan and our mission.
+ 
+Our Competitive Advantage
+ 
+ 
+ 
+Industry Leading Management Assembled management expertise across all agency disciplines and offerings consisting of established industry leaders.
+
+ 
+ 
+ 
+
+ 
+ 
+Integrated Services integrated branding, advertising, data analytics, performance media, research & insights, design, production, content, event marketing, public relations, partnerships and social media.
+
+ 
+ 
+ 
+
+ 
+ 
+Category Experience entertainment media, sports, fashion, gaming/eSports, consumer goods, telco, tech, leisure entertainment.
+
+ 
+ 
+ 
+
+ 
+ 
+Results Driven We are innovating how brands drive customer engagement, conversion, loyalty and lifetime value though integrated branding, advertising and performance optimization. See Business Segments, below.
+
+ 
+ 
+ 
+
+ 
+ 
+One Stop Integrated, full-service solution with our broad talent, skills and experience, provides client the confidence in having one organization handling all or the majority of their campaigns and projects.
+
+ 
+Market Opportunity
+ 
+We seek to capitalize on the convergence of wireless, broadband, and content-based service models. Today, we believe that every brand needs engaged audiences and loyal fans and that building an exciting brand experience is key to maintaining fan loyalty and engagement. We also believe that media has been democratized and audiences are becoming ever more fragmented. As a result, brands now struggle to connect with consumers. We are scaling the business by expanding into new verticals, bringing entertainment media category expertise to brands that need to engage consumers on their terms, as audiences and fans. Moreover, growth in new applications in wireless services and multimedia services, increasing demand for high quality mobile and high definition video entertainment services, drive the underlying demand for our branding and analytics services. It is widely accepted that existing networks and technologies cannot fulfill this demand. 
+ 
+ 
+-7-
+
+Table of Contents
+ 
+The following statistics foretell the expanding market we seek to service:
+ 
+ 
+ 
+Global internet users = 3.4 billion people in 2016 with 10% annual growth is over 50% of the population in 2018 (Internet Trends 2017 Code Conference, Mary Meeker, May 31, 2017, Kleiner Perkins Conference, hereinafter referred to as Kleiner Perkins Report ).
+
+ 
+ 
+ 
+
+ 
+ 
+4 Hours and 7 Minutes: According to Digital Trends Average time spent by users on smartphones daily other than talking.
+
+ 
+ 
+ 
+
+ 
+ 
+Digital media use is between 49% and 42% for ages 18-49 (Kleiner Perkins Report ).
+
+ 
+ 
+ 
+
+ 
+ 
+According to Forbes, people in the U.S. check their Facebook, Twitter, and other social media accounts a staggering 17 times a day, meaning at least once an hour.
+
+ 
+ 
+ 
+
+ 
+ 
+Nielsen Company report reveals that adults in the U.S. devoted approximately 10 hours and 39 minutes each day consuming media during the fourth quarter of 2018.
+
+ 
+Although we have been able to pursue our growth strategy, general economic conditions, and market uncertainty may negatively affect our financial results in future periods. We anticipate that the rate of branding and experiential activities will become more predictable however may vary from quarter to quarter. Consequently, if anticipated business in any quarter do not occur when expected, expenses and resource levels could be disproportionately high, and our operating results for that quarter and future quarters may be adversely affected. Further, given the lag between the incurrence of expenses in connection with branding and experiential services, we anticipate that, while we will see organic growth that positions us for future profitability, our costs of sales and other operating expenses may exceed our revenues in the near term. We have incurred operating losses since our inception.
+ 
+We continue to execute on all aspects of our business, including our digital technology and media business serving the sports, entertainment and convention center market. We have found that truly successful businesses find ways of taking fixed assets and generating multiple revenue opportunities over those fixed assets, preferably on a contractual monthly recurring revenue or retainer model, thereby improving profitability. The Troika brand brings media and design expertise and experience with a proven track record of success in major brand identity and development projects boasting some of the premier names in the sports and entertainment industries. 
+ 
+The following factors present a favorable market opportunity for us:
+ 
+ 
+ 
+2021 Was A Record Year for Ad Spending, With More Growth Expected In 2022. Forbes, Dec 8, 2021
+
+ 
+ 
+ 
+
+ 
+ 
+In 2016, digital ad spending surpassed TV ad spending for the first time. (eMarketer report US Digital Display Advertising Trends: Eight Developments to Watch for in 2016)
+
+ 
+ 
+ 
+
+ 
+ 
+This year, 2022, digital ad spending is expected to climb 16.5% to $10.84b crossing the $10b threshold for the first time. After reaching $12.65b next year, it is projected to hit $14.57b in 2023.eMarketer s US B2B Advertising Forecast 2021
+
+ 
+ 
+ 
+
+ 
+ 
+While the pandemic decimated many aspects of the economy, the job market, and consumer confidence, it seems to have done little to quash a bonanza in digital ad spending. Insider Intelligence s Digital Advertising Trends to Watch in 2022
+
+ 
+ 
+ 
+
+ 
+ 
+Digital Ad Spending Keeps Rising While Ad Measurement Debate Reaches New Stage, Paul Verna, Nov 29, 2021
+
+ 
+ 
+ 
+
+ 
+ 
+The US digital ad market will surpass $300 billion by 2025, making up more than three-quarters of all media spending. Insider Intelligence s Digital Advertising Trends to Watch in 2022
+
+ 
+ 
+ 
+
+ 
+ 
+Ad spending is shifting to digital
+
+ 
+ 
+ 
+
+ 
+ 
+Among digital segments, search will lead with $98.6 billion, (+39% from 2020) accounting for over one-third of all ad dollars invested in media in 2021. Social media will generate $58.8 billion in ad spend, increasing by 36% from 2020, one-fifth of all ad dollars spent in 2021 will be allocated to social media. (Forbes report Agencies Agree: 2021 Was A Record Year For Ad Spending, With More Growth Expected In 2022 December 8, 2021)
+
+ 
+ 
+ 
+
+ 
+ 
+Digital ad spending is expected to double linear television ad spending in 2022, with digital spending accounting for 55.5% of the global ad spend and linear TV accounting for 26.9%. (Marketing Charts report Digital Ad Spend Forecast to Double Linear TV This Year March 11, 2022)
+
+ 
+ 
+ 
+
+ 
+ 
+Driving the growth in ad dollars will be the digital pure play media which will grow by 35% in 2021 and total $126.4 billion, accounting for 57% of total ad dollars. (Forbes report Agencies Agree: 2021 Was A Record Year For Ad Spending, With More Growth Expected In 2022 December 8, 2021)
+
+ 
+ 
+ 
+
+ 
+ 
+More than ever, brands need to demonstrate empathy and create emotional connections which empathize and emote. Consumers are eager for uplifting, positive, feel-good advertising and stories during these uncertain times. (Information Resources Inc. June 3, 2020)
+
+ 
+ 
+ 
+
+ 
+ 
+The growth in digital ad spending is expected to continue through 2024, when spending on digital advertising is expected to reach $483.1 billion and account for 59.4% of the global ad spend, compared to a projected 24.9% for linear television. (Marketing Charts report Digital Ad Spend Forecast to Double Linear TV This Year March 11, 2022)
+
+ 
+ 
+ 
+
+ 
+ 
+Gaming industry reported the largest increase in consumption is also expanding the experiences it offers as eSports are gaining legitimacy. (Impact of the Covid-19 outbreak on Media & Entertainment Overview of Key Industry Disruptions & Post-Crisis Challenges and Opportunities May 26th, 2020, Cap Gemini S.A.)
+
+ 
+ 
+ 
+
+ 
+ 
+The challenge for brands is deciding on the mix of Agency services to In-House and do it well. (The Outlook for Data Driven Advertising & Marketing 2020, Jan 2020, Winterberry Group) 
+
+ 
+ 
+ 
+
+ 
+ 
+Story ads integrate brand stories seamlessly into social environments. 1 in 3 of the most watched Instagram stories are from businesses. A study found that 70% of Instagram and Snapchat users watch stories on both platforms daily. (Brand Disruption 2020: Direct Brands Go Mainstream Direct Brands Initiative Strategic Partners, February 2020, Interactive Advertising Bureau) 
+
+ 
+ 
+-8-
+
+Table of Contents
+ 
+We believe we will be well positioned to compete due to our numerous advantages: 
+ 
+ 
+ 
+Global end-to-end branding & advertising solution
+
+ 
+ 
+
+ 
+ 
+Blue-chip clients with longevity
+
+ 
+ 
+
+ 
+ 
+Based globally in five major cities, New York, Englewood (New Jersey), San Diego, Los Angeles and London
+
+ 
+ 
+
+ 
+ 
+Approximately 185 employees plus 23 independent contractors 
+
+ 
+ 
+
+ 
+ 
+Capabilities: branding, advertising, data analytics, performance media, research & insights, content, PR, social, partnerships, mobile
+
+ 
+ 
+
+ 
+ 
+Diverse categories: entertainment & media, sports, fashion, gaming/eSports, consumer goods, telco, tech, healthcare, pharmaceutical, leisure and entertainment.
+
+ 
+Summary of Risk Factors
+ 
+Our business is subject to numerous risks and uncertainties, including those in the section entitled Risk Factors and elsewhere in this prospectus. These significant risks include, but are not limited to, the following:
+ 
+ 
+ 
+our history of losses may harm our ability to obtain additional financing;
+
+ 
+ 
+our ability to retain our largest clients;
+
+ 
+ 
+our ability to integrate the combined operations of our previously acquired companies, particularly the recent Converge Acquisition;
+
+ 
+ 
+general economic conditions in the United States and United Kingdom as a result of the COVID-19 pandemic and the war in Ukraine;
+
+ 
+ 
+our ability to achieve and maintain profitably;
+
+ 
+ 
+our ability to sustain or grow our customer base for our current products and provide superior customer service;
+
+ 
+ 
+our liquidity and working capital requirements, including our cash requirements over the next 12 months;
+
+ 
+ 
+our ability to maintain compliance with the ongoing maintenance requirements for the Nasdaq Capital Market including, but not limited to, the minimum bid price requirement;
+
+ 
+ 
+compliance with the U.S. and international regulations applicable to our business;
+
+ 
+ 
+our ability to implement our business strategies and future plans of operations;
+
+ 
+ 
+expectations regarding the size of our market;
+
+ 
+ 
+our expectations regarding the future market demand for our services;
+
+ 
+ 
+compliance with applicable laws and regulatory changes, including, but not limited to, recent regulations affecting cybersecurity and climate change;
+
+ 
+ 
+our ability to identify, attract and retain qualified personnel and the loss of key personnel;
+
+ 
+ 
+the limitation of liability and indemnification of our officers and directors;
+
+ 
+ 
+economic conditions affecting the media industry in which we operate;
+
+ 
+ 
+economic conditions in the United Kingdom as a result of Brexit;
+
+ 
+ 
+maintaining our intellectual property rights and any potential litigation involving intellectual property rights;
+
+ 
+ 
+our ability to anticipate and adapt to a developing market(s) and to technological changes;
+
+ 
+ 
+acceptance by customers of any new products and services;
+
+ 
+ 
+a competitive environment characterized by numerous, well-established and well-capitalized competitors; 
+
+ 
+ 
+the ability to develop and upgrade our technology and information systems and keep up with rapidly evolving industry standards;
+
+ 
+ 
+any interruption in the supply of products and services;
+
+ 
+ 
+discontinuance of support for our information systems from third party vendors;
+
+ 
+ 
+significant fluctuations in our quarterly operating results;
+
+ 
+ 
+the extent, liquidity, volatility and duration of any public trading market for our securities;
+
+ 
+ 
+the resale of our securities could adversely affect the market price of our common stock and our Warrants and our ability to raise additional equity capital;
+
+ 
+ 
+we may become subject to penny stock rules, which could damage our reputation and the ability of investors to sell their shares; and
+
+ 
+ 
+insiders, including significant stockholders, will continue to have substantial control over the Company.
+
+ 
+ 
+-9-
+
+Table of Contents
+ 
+Corporate Information
+ 
+We were incorporated in Nevada in November 2003. Our corporate headquarters are located at 1715 N. Gower St., Los Angeles, California 90028, and our main telephone number is (323) 965-1650. Our website address is www.thetmgrp.com. The information on our website is not part of this prospectus. We have included our website address as a factual reference and do not intend it to be an active link to our website.
+ 
+Private Placement of Preferred Stock and Warrants 
+ 
+On March 16, 2022, Troika Media Group, Inc. ( we, our, us, or the Company ) entered into a Securities Purchase Agreement (the Purchase Agreement ) with certain institutional investors (the Purchasers ), pursuant to which the Company agreed to issue and sell, in a private offering (the March 2022 Private Placement ), an aggregate of $50,000,000 of securities, consisting of shares of Series E convertible preferred stock of the Company, par value $.01 per share (the Series E Preferred Stock ) and warrants to purchase (100% coverage) shares of common stock (the Warrants ) (collectively, the Series E Preferred Stock and Warrants are referred to as the Securities ). Under the terms of the Purchase Agreement, the Company agreed to sell 500,000 shares of its Series E Preferred Stock and Warrants to purchase up to 33,333,333 shares of the Company s common stock (the Conversion Shares ). Each share of the Series E Preferred Stock has a stated value of $100 per share and is convertible, at any time, into shares of common stock at a conversion price of $1.50 per share (the Conversion Price ), subject to adjustment. 
+ 
+The Series E Preferred Stock is convertible at any time at the option of the holder by dividing the Stated Value of $100 per share by the initial Conversion Price of $1.50 per share, subject to adjustment, as described below. In addition, the Conversion Price shall be downwardly adjusted (the Registration Reset Price ) to the greater of (i) eighty (80%) percent of the average of the ten (10) lowest daily VWAPs during the forty (40) trading day period (subject to acceleration by the holder after ten (10) trading days) beginning on and including the trading day immediately follow the later of the effective date (hereinafter, the Effective Date ) of this initial Registration Statement (hereinafter, the Registration Adjustment Period ), and (ii) the Floor Price of $0.25 per share.
+ 
+The Warrants are immediately exercisable at $2.00 per share (the Exercise Price ), subject to adjustment, for five (5) years ending March 21, 2027. If at any time there is no effective registration statement, the Warrants are exercisable on a cashless basis. The exercise price is subject to the Registration Reset Price, as stated above for the Series E Preferred Stock, however, shall be equal to the average of the ten (10) lowest daily VWAPs during the Registration Adjustment Period. The Conversion Price of the Series E Preferred Stock and the Exercise Price of the Warrants is subject to adjustment for: (a) stock dividends and stock distributions; (b) subsequent rights offerings; (c) pro rata distributions; (d) reverse and forward stock splits; and (e) Fundamental Transactions (as defined).
+ 
+ 
+-10-
+
+Table of Contents
+ 
+The Purchase Agreement contained customary representations and warranties and agreements of the Company and the Purchasers and customary indemnification rights and obligations of the parties. Pursuant to the Purchase Agreement, the Company agreed to certain restrictions on the issuance and sale of its shares of common stock or common stock Equivalents (as defined in the Purchase Agreement) during the 120-day period following the final Conversion Price Adjustment (as defined) following the effective date of a Registration Statement.
+ 
+A holder (together with its affiliates) will not be able to convert any portion of the Series E Preferred Stock and/or exercise any portion of the Warrants to the extent that the holder would own more than 4.99% (or, at the holder s option upon issuance, 9.99%) of the Company s outstanding shares of common stock immediately after exercise. However, upon prior notice from the holder to the Company, a holder with a 4.99% ownership blocker may increase or decrease the amount of ownership of outstanding shares of common stock after converting the Series E Preferred Stock and/or exercising the holder s Warrant up to 9.99% of the number of the Company s shares of common stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Securities, provided that any increase shall not be effective until 61 days following notice to us. In addition, sales by the Purchasers may be limited, to the extent applicable, by Nasdaq and SEC rules. 
+ 
+The Purchase Agreement contains customary representations, warranties, covenants, conditions and agreements of the Company and the Purchasers and customary indemnification rights and obligations of the parties. Pursuant to terms of the Purchase Agreement, the Company agreed to certain restrictions on the issuance and sale of its common stock or Common Stock Equivalents (as defined in the Purchase Agreement) during the 120-day period following the final Conversion Price Adjustment. The Company agreed with the Purchasers that it will not enter into any variable rate transaction with any third party for a 120-day period following the final Conversion Price Adjustment (as defined). During the six-month period following the final Conversion Price Adjustment, the Purchaser shall have a right of participation in any equity offering in excess of $1,000,000 for up to fifty (50%) percent of any public and/or private offering. The Company also agreed that for a one-year period from the Effective Date, it will not undertake a reverse or forward stock split or reclassification of its common stock without the prior written consent of a majority in interest of the Purchasers.
+ 
+Each of the Company s Officers and Directors entered into a Lock-Up Agreement prohibiting transfers and sale of their Ordinary Shares, with certain a sixty (60) day period following the Effective Date. The Company agreed to not amend, modify, waive or terminate any provision of any of the Lock-Up Agreements. 
+ 
+Pursuant to the terms of the registration rights agreement (the RRA ), the Company agreed to use commercially reasonable efforts to cause a Registration Statement providing for the resale by holders of shares issuable upon the conversion of the Series E Preferred Stock, to be filed within ten (10) business days (the Filing Date ) of the Closing Date (as defined), which filing occurred on April 4, 2022. The Company shall use its best efforts to cause this Registration Statement to be declared effective no later than forty-five (45) days following the Filing Date or, in the case of a full review by the SEC, the 90th day following the Filing Date. The Company agreed to file a second Registration Statement (No. 333-264761) for the Warrant Shares on the fifteenth (15th) calendar day following April 21, 2022, which was the date the Company s Articles of Incorporation were amended to increase authorized shares of Common Stock from 300 million to 800 million shares pursuant to shareholder approval.
+ 
+The Private Placement was completed on March 21, 2022, simultaneously with a debt offering and the Converge Acquisition. The Company received gross proceeds of $50,000,000 in connection with the Private Placement before deducting placement agent fees and other related offering expenses. The Company used the net proceeds from the private placement primarily for the Converge Acquisition, as well as for working capital purposes.
+ 
+Pursuant to a letter agreement dated October 27, 2021 (the Engagement Letter ), the Company engaged EF Hutton, division of Benchmark Investments, LLC (the Placement Agent ) as exclusive Placement Agent in connection with the Private Placement. The Company paid to the Placement Agent a cash fee of eight (8%) percent and accountable and non accountable expenses and Warrants to purchase 1,000,000 shares of common stock, subject to adjustment. 
+ 
+The foregoing summaries of the Certificate of Designation, the Warrants, the Registration Rights Agreement and the Purchase Agreement (collectively, the Transaction Documents ) do not purport to be complete and are subject to, and qualified in their entirety by, such documents attached as Exhibits 3.1, 4.1, 4.2 and 4.3, respectively, to the Company s Report on Form 8-K filed on March 18, 2022, which are incorporated herein by reference. 
+ 
+ 
+-11-
+
+Table of Contents
+ 
+Debt Offering 
+ 
+Financing Agreement
+ 
+On March 21, 2022, the Company entered into a Financing Agreement by and among the Company, as Borrower, and each subsidiary of the Borrower, as a Guarantor, the Lenders from time to time party thereto, and Blue Torch Finance LLC ( Blue Torch ), as Administrative Agent and Collateral Agent. This $75,000,000 First Lien Term Loan (the Credit Facility ) formed the majority of the purchase price of the Converge Acquisition, as well as for working capital and general corporate purposes. Cantor Fitzgerald & Co. acted as sole debt placement agent in connection with the Converge Acquisition. Closing of the Credit Facility was conditioned upon the March 2022 Private Placement being completed simultaneously on March 21, 2022. The Credit Facility provides for: (i) a Term Loan in the amount of $75,000,000; (ii) an interest rate of the Libor Rate Loan of three (3) months; (iii) a four-year maturity, amortized 5.0% per year, payable quarterly; (iv) a 1.0% commitment fee and an upfront fee of 2.0% of the Credit Facility paid at closing, plus an administrative agency fee of $250,000 per year; (v) a first priority perfected lien on all property and assets including all outstanding equity of the Company s subsidiaries; (vi) 1.5% fully-diluted penny warrant coverage in the combined entity; (vii) mandatory prepayment for 50% of excess cash flow and 100% of proceeds from various transactions; (viii) customary affirmative, negative and financial covenants; (ix) delivery of audited financial statements of Converge; and (x) customary closing conditions. The Company agreed to customary restrictive covenants in the Credit Facility and leverage ratios, fixed charge coverage ratios, and maintaining liquidity of at least $6,000,000 at all times.
+ 
+Pledge and Security Agreement
+ 
+The Company and each of its subsidiary Guarantors entered into a Pledge and Security Agreement (the Security Agreement ) dated as of March 21, 2022, as a requirement under the Credit Facility. Each Guarantor pledged and assigned to Blue Torch, as the Collateral Agent and granted the Collateral Agent a continuing security interest in all personal property and fixtures of the Guarantors (the Collateral ) and all proceeds of the Collateral. All equity of the Guarantors was pledged by the Borrower. Upon an Event of Default (as defined), the Collateral Agent may exercise in addition to all rights and remedies under the Security Agreement, all rights and remedies of a secured party under the UCC and may take control of the Collateral.
+ 
+Intercompany Subordination Agreement
+ 
+On March 21, 2022, each of the Company s Subsidiaries, as Guarantors, entered into an Intercompany Subordination Agreement with the Collateral Agent. Under such agreement, each obligor agreed to the subordination of such indebtedness of each other obligor to such other obligations.
+ 
+Escrow Agreement
+ 
+On March 21, 2022, the Company entered into an Escrow Agreement with Blue Torch Finance LLC and Alter Domus (US) LLC, as Escrow Agent. The Escrow Agreement provided for the escrow of $30,000,000 of the $75,000,000 proceeds, under the Credit Facility which was held until the audited financial statements of Converge Direct LLC and affiliates for the years ended December 31, 2019, 2020 and 2021 were delivered to Blue Torch Finance LLC.
+ 
+ 
+-12-
+
+Table of Contents
+ 
+The Offering
+ 
+Common Stock Offered:
+ 
+An aggregate of 200,000,000 shares of common stock are registered for resale by the Selling Stockholders, consisting of shares of common stock issuable to the Purchasers under the Purchase Agreement, dated as of March 16, 2022 upon conversion of 500,000 shares of Series E Preferred Stock pursuant to the terms and conditions of the Certificate of Designation for the Series E Preferred Stock. The 500,000 shares of Series E Preferred Stock have a stated value of $100 per share, or an aggregate of $50,000,000. The shares are convertible at $1.50 per share, or an aggregate of approximately 33,333,333 shares of common stock, subject to adjustment, for reverse and forward stock splits, stock dividends, stock combinations and other such transactions. In addition, the Conversion Price shall be downwardly adjusted (the Registration Reset Price ) to the greater of (i) eighty (80%) percent of the average of the ten (10) lowest daily VWAPs during the forty (40) trading day period beginning on and including the Trading Day immediately follow the Effective Date of the initial Registration Statement, and (ii) the Floor Price of $0.25 per share unless a holder elects to shorten the adjustment period to all or a portion of the Series E Preferred Stock held by such person to between ten (10) and thirty-nine (39) trading days.
+
+ 
+ 
+ 
+
+Ordinary Shares Outstanding:
+ 
+64,173,683 (1)
+
+ 
+ 
+ 
+
+Use of Proceeds:
+ 
+We are not selling any securities under this prospectus and will not receive any of the proceeds from the sale of common stock by the Selling Stockholders. 
+
+ 
+ 
+ 
+
+Dividend Policy:
+ 
+We have never declared any cash dividends on our common stock. The Series E Preferred Stock does not pay dividends unless declared on the underlying common stock. We currently intend to retain all available funds and any future earnings for use in financing the growth of our business and do not anticipate paying any cash dividends for the foreseeable future. See Dividend Policy. 
+
+ 
+ 
+ 
+
+Trading Symbols:
+ 
+Our common stock and Warrants currently trade on the Nasdaq Capital Market with the symbols TRKA and TRKAW, respectively.
+
+ 
+ 
+ 
+
+Risk Factors:
+ 
+You should carefully consider the information set forth in this prospectus and, in particular, the specific factors set forth in the Risk Factors section beginning on page 16 of this prospectus before deciding whether or not to invest in our Common Stock.
+
+ 
+(1) Reflects shares issued and outstanding as of June 3, 2022. The number of shares of our common stock outstanding excludes: 
+ 
+ 
+ 
+3,826,839 shares issuable upon exercise of outstanding employee stock options;
+
+ 
+ 
+ 
+
+ 
+ 
+8,605,222 shares issuable upon exercise of outstanding warrants, 5,783,333 shares issuable upon exercise of outstanding public warrants exercisable at $4.98 per share, Representative s Warrants to purchase 173,494 shares, and 1,929,439 shares, subject to adjustment, issuable upon exercise of outstanding warrants issued to Blue Torch Finance, LLC in connection with our Debt Offering;
+
+ 
+ 
+ 
+
+ 
+ 
+1,100,000 shares issuable upon exercise of outstanding restricted stock units ( RSUs ) and an additional 3,200,000 shares reserved for issuance under the Company s 2021 Employee, Director and Consultant Equity Incentive Plan (the Incentive Plan ), plus 3,500,000 RSUs outstanding outside of the Incentive Plan;
+
+ 
+ 
+ 
+
+ 
+ 
+33,333,333 shares registered under this registration statement and, subject to adjustment, issuable to the Purchasers upon conversion of the Series E Preferred Stock, and 33,333,333 shares issuable upon exercise of the Warrants issued in the March 2022 Private Placement, and placement agent Warrants to purchase up to 1,000,000 shares, subject to adjustment, issuable in the March 2022 Private Placement; and
+
+ 
+ 
+ 
+
+ 
+ 
+The Purchase Agreement includes the sale of Investor Warrants to purchase up to 33,333,333 shares of common stock, subject to adjustment, which shares are being registered on a separate registration statement (No. 333-264112).
+
+ 
+ 
+-13-
+
+Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001076682_polarityte_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001076682_polarityte_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..20256676ee4d34ca86c45ae73e8e7093a852d003
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001076682_polarityte_prospectus_summary.txt
@@ -0,0 +1,169 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights selected information contained elsewhere in this prospectus or in filings we make with the Securities and Exchange
+Commission ("SEC") that are incorporated herein by reference. This summary does not contain all the information that you
+should consider before deciding to invest in our securities. You should read the entire prospectus, including the information incorporated
+by reference herein, carefully, including the section titled "Risk Factors," included elsewhere in this prospectus, and in
+the sections entitled "Risk Factors" and "Management s Discussion and Analysis of Financial Condition and Results
+of Operations" and our financial statements and the related notes included in our annual report on Form 10-K for the fiscal year
+ended December 31, 2021, and our quarterly report on Form 10-Q for the quarterly period ended June 30, 2022, which are incorporated herein
+by reference. Some of the statements in this prospectus constitute forward-looking statements. See "Special Note Regarding Forward-Looking
+Statements." 
+
+ 
+
+Overview
+
+ 
+
+PolarityTE
+is a clinical stage biotechnology company developing regenerative tissue products and biomaterials. PolarityTE s first regenerative
+tissue product is SkinTE, which is intended for the repair, reconstruction, replacement, and supplementation of skin in patients who
+have a need for treatment of acute or chronic wounds, burns, surgical reconstruction events, scar revision, or removal of dysfunctional
+skin grafts.
+
+ 
+
+Since
+the beginning of 2017, PolarityTE has incurred substantial operating losses and its operations have been financed primarily by public
+equity financings. The clinical trials for SkinTE and the regulatory process will likely result in an increase in PolarityTE s
+expenses. PolarityTE will continue to incur substantial operating losses as we pursue an investigational new drug application ("IND")
+and biologics license application ("BLA"), and PolarityTE expects to seek financing from external sources over the foreseeable
+future to fund its operations.
+
+ 
+
+Regenerative
+Tissue Product
+
+ 
+
+Our
+first regenerative tissue product is SkinTE. On July 23, 2021, we submitted an IND for SkinTE to the U.S. Food and Drug Administration
+(the "FDA") through our subsidiary, PolarityTE MD, Inc. ("PTE-MD"), as the first step in the regulatory process
+for obtaining licensure for SkinTE under Section 351 of the Public Health Service Act. The FDA subsequently issued clinical hold correspondence
+to us identifying certain issues that needed to be addressed before the IND could be approved. We provided responses to the FDA, and
+on January 14, 2022, the FDA notified us that the clinical hold had been removed. Our first planned pivotal study under our IND is a
+multi-center, randomized controlled trial evaluating SkinTE in the treatment of diabetic foot ulcers ("DFUs") classified
+as Grade 2 in the Wagner classification system entitled "Closure Obtained with Vascularized Epithelial Regeneration for DFUs with
+SkinTE," or "COVER DFUs Trial." We plan to enroll up to 100 subjects at up to 20 sites in the U.S. in the COVER DFUs
+Trial, which will compare treatment with SkinTE plus the standard-of-care to the standard-of-care alone. We have been enrolling subjects
+in the COVER DFUs Trial since the end of April 2022. The primary endpoint is the incidence of DFUs closed at 24 weeks. Secondary endpoints
+include percent area reduction ("PAR") at 4, 8, 12, 16, and 24 weeks, improved quality of life, and new onset of infection
+of the DFU being evaluated.
+
+ 
+
+In
+March 2022, we submitted to the FDA a request for a Regenerative Medicine Advanced Therapy ("RMAT") designation for SkinTE
+under our IND. Established under the 21st Century Cures Act, RMAT designation is a dedicated program designed to expedite the drug development
+and review processes for promising regenerative medicine products, including human cellular and tissue-based therapies. A regenerative
+medicine therapy is eligible for RMAT designation if it is intended to treat, modify, reverse, or cure a serious or life-threatening
+disease or condition, and preliminary clinical evidence indicates that the drug or therapy has the potential to address unmet medical
+needs for such disease or condition. RMAT designation provides the benefits of intensive FDA guidance on efficient drug development,
+including the ability for early interactions with the FDA to discuss potential ways to support accelerated approval and satisfy post-approval
+requirements, potential priority review of a BLA, and other opportunities to expedite development and review. By letter dated May 11,
+2022, we were advised by the FDA that it concluded SkinTE meets the criteria for RMAT designation for the treatment of DFUs and venous
+leg ulcers (VLUs).
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+As
+a result of the RMAT designation we were able to engage in an expedited dialogue with the FDA on the tasks that are likely to be necessary
+to support a BLA submission for SkinTE as a treatment of DFUs and VLUs, which were identified in the RMAT designation. Based on that
+dialogue we plan to run a second multi-center, randomized controlled trial under our current IND to support approval of a broad DFU indication
+for SkinTE in a BLA, and we plan to engage in discussions with the FDA regarding the design and implementation of the second clinical
+trial. We believe this strategy will be the fastest and least costly approach to achieving our first BLA submission for SkinTE, with
+DFUs representing the largest market opportunity within the category of chronic cutaneous ulcers. We plan to further engage with the
+FDA to fully define our development plan for other wound indications.
+
+ 
+
+We
+expect to incur significant operating costs in the next three to four years as we pursue the regulatory process for SkinTE with the FDA,
+conduct clinical trials and studies, and pursue product research, all while operating our business and incurring continuing fixed costs
+related to the maintenance of our assets and business. We expect to incur significant losses in the future, and those losses could be
+more severe as a result of unforeseen expenses, difficulties, complications, delays, and other unknown events. Our net losses may fluctuate
+significantly from quarter-to-quarter and year-to-year, depending upon the timing, progress, and outcomes of our clinical trials and
+our expenditures for satisfying all the conditions of obtaining FDA licensure for SkinTE.
+
+ 
+
+Update
+on Securities Class Action Lawsuit
+
+ 
+
+As
+previously reported, in September 2021, a class action complaint alleging violations of the Federal securities laws was filed in the
+United States District Court, District of Utah, by Marc Richfield against the Company and certain officers of the Company, Case No. 2:21-cv-00561-BSJ.
+The Court subsequently appointed a Lead Plaintiff and ordered the Lead Plaintiff to file an amended complaint, which was filed against
+the Company, two current officers of the Company, and three former officers of the Company (the "Complaint"). The Complaint
+alleges that during the period from January 30, 2018, through November 9, 2021, the defendants made or were responsible for, disseminating
+information to the public through reports filed with the Securities and Exchange Commission and other channels that contained material
+misstatements or omissions in violation of Sections 10(b) and 20(a) of the Securities and Exchange Act of 1934, as amended, and Rule
+10b-5 adopted thereunder. The Company filed a motion to dismiss the Complaint for failure to state a claim, on April 22, 2022. The Lead
+Plaintiff filed its memorandum in opposition to the Company s motion to dismiss on July 18, 2022. The Company filed its reply memorandum
+to the Lead Plaintiff s opposition memorandum on August 11, 2022, and oral argument on the motion to dismiss was held September
+8, 2022. At the hearing the judge issued a ruling from the bench dismissing the Complaint without prejudice and granting the Lead Plaintiff
+leave to file an amended complaint. The Lead Plaintiff filed an amended complaint (the "Amended Complaint") on October 3,
+2022, alleging additional facts. We are required to file a pleading responsive to the Amended Complaint by November 2, 2022, and our
+intention is to file a motion to dismiss the Amended Complaint for failure to state a claim. At this stage of the proceedings, we are
+unable to make any prediction regarding the outcome of a second motion to dismiss, should we decide to file such a motion, or the ultimate
+outcome of the litigation.
+
+ 
+
+Recent
+Developments
+
+ 
+
+On
+May 16, 2022, we implemented a 1-for-25 reverse split of our issued and outstanding common stock. All stock figures and related dollar
+amounts for exercise or conversion prices or amounts in the prospectus give effect to the reverse stock split. The reverse stock split
+combined each 25 shares of our outstanding common stock into one share of common stock, without any change in the par value per share.
+As a result, the number of shares of our common stock subject to outstanding options, warrants, and convertible securities was reduced
+by a factor of 25, and the exercise price or conversion price by a factor was increased by a factor of 25. Except as otherwise indicated,
+all historical share and per-share amounts in this prospectus have been adjusted to reflect the 1-for-25 reverse stock split, as if it
+was effective and as if it had occurred at the beginning of the earliest period presented.
+
+ 
+
+Company
+Background
+
+ 
+
+Majesco
+Entertainment Company, a Delaware corporation ("Majesco DE"), was incorporated in the state of Delaware on May 8, 1998. On
+December 1, 2016, Majesco Acquisition Corp., a Nevada corporation and wholly owned subsidiary of Majesco DE, entered into an Agreement
+and Plan of Reorganization with PolarityTE, Inc., a Nevada corporation ("Polarity NV") and the sole stockholder of Polarity
+NV. The asset acquisition was subject to stockholder approval, which was received on March 10, 2017, and the transaction closed on April
+7, 2017. In January 2017, Majesco DE changed its name to "PolarityTE, Inc." ("Polarity"). Majesco Acquisition
+Corp. was then merged with Polarity NV, which remains a subsidiary of Polarity. Majesco Acquisition Corp. II, formed in November 2016
+under Majesco Entertainment Company, changed its name to "PolarityTE MD, Inc.," and remains a wholly owned subsidiary of
+Polarity.
+
+ 
+
+Our
+principal executive offices are located at 1960 S. 4250 West, Salt Lake City, Utah 84104, and our telephone number is (385) 266-3151.
+We maintain a website at www.PolarityTE.com. Information contained in or accessible through our website does not constitute a part of
+this prospectus.
+
+ 
+
+ 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001281845_unique_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001281845_unique_prospectus_summary.txt
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@@ -0,0 +1,2009 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all of the information
+that you should consider before deciding to invest in our Common Stock. You should read the entire prospectus carefully, including the
+ Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, 
+and our combined financial statements and the related notes thereto that are included elsewhere in this prospectus, before making an
+investment decision.
+
+ 
+
+Overview
+
+ 
+
+Unique
+Logistics International, Inc. ( Unique Logistics or Unique or the Company ) provides a
+full range of global logistics services by providing to its customers a robust international network that strategically supports the
+movement of its customers goods. Acting solely as a third-party logistics provider, Unique purchases available cargo space in volume
+from its network of carriers (such as airlines, ocean shipping, and trucking lines) and resells that space to our customers. Unique Logistics
+does not own any of these ships, trucks, or aircraft and does not plan on entering the ownership model.
+
+ 
+
+Operating
+via its wholly owned subsidiaries, Unique Logistics International (BOS) Inc, a Massachusetts corporation ( UL BOS ) and Unique
+Logistics International (NYC), LLC, a Delaware limited liability company, Unique Logistics provides a range of international logistics
+services that enable its customers to outsource to the Company sections of their supply chain process. The services provided by the Company
+are seamlessly managed by its network of trained employees and integrated information systems. We enable our customers to share data
+regarding their international vendors and purchase orders with us, execute the flow of goods and information under their operating instructions,
+provide visibility to the flow of goods from factory to distribution center or store and when required, update their inventory records.
+
+ 
+
+The Company operates in a business environment
+where both our customers as well as our suppliers are potentially impacted by the Covid-19 pandemic. Our customer base includes several
+customers whose business involves retail to the public through brick and mortar stores, many of them in shopping malls. In the period
+February 2020 to May 2020, many such customers faced significant downturn in their business resulting in shut down of supply chains and
+business loss for our Company. The Company s operating subsidiaries secured PPP loans from the government that enabled us to maintain
+our operations and meet our overhead commitments in this period. Driven initially by online retail and later by the opening of in-person
+retail, by February 2021 most of our customers saw their business recover to pre-pandemic levels. As the business of our customers recovered, the Company s business
+steadily increased and surpassed pre-pandemic era volumes.
+
+ 
+
+Company
+Structure and History 
+
+ 
+
+Unique
+Logistics International, Inc. (the Company or Unique ) (formerly Innocap, Inc.) was incorporated in Nevada
+on January 23, 2004. Innocap, Inc. became a publicly traded company in 2004. In May 2011, the Company changed its business plan to researching
+the location of and salvaging sunken ships. Until October 2020, the Company had been actively negotiating several research and salvage
+projects including in Indonesia and Malaysia in connection with ships that were sunk during World War II.
+
+ 
+
+On
+October 8, 2020, the Company, Inno Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of the Company (the Merger
+Sub ), and Unique Logistics Holdings, Inc., a privately-held Delaware corporation headquartered in New York ( UL HI ),
+entered into an Acquisition Agreement and Plan of Merger (the Acquisition Agreement ) pursuant to which the Merger Sub was
+merged with and into UL HI, with UL HI surviving as a wholly-owned subsidiary of Innocap Inc. (the Merger ). The transaction
+(the Closing ) took place on October 8, 2020 (the Closing Date ). Innocap Inc. acquired, through a reverse
+triangular merger, all of the outstanding capital stock of UL HI in exchange for issuing UL HI s shareholders (the UL HI
+Shareholders ), pro-rata, an aggregate of 1,000,000 million shares of preferred stock, with certain of UL HI Shareholders receiving
+130,000 shares of Innocap Inc. s Series A Preferred Stock par value $0.001 per share, and certain of the UL HI Shareholders receiving
+of 870,000 shares of Innocap Inc. s Series B Preferred Stock, par value $0.001 per share. Immediately after the Merger was consummated,
+and further to the Acquisition Agreement, certain affiliates of Innocap Inc. cancelled a total of 45,606,489 shares of Innocap Inc. s
+common stock, and 1,000,000 shares of Preferred Stock held by them (the Cancellation ). In consideration of the Cancellation
+of such shares of Innocap Inc. s common stock and preferred stock, Holdings agreed to assume certain liabilities of Innocap Inc.
+As a result of the Merger and the Cancellation, the UL HI Shareholders became the majority shareholders of the Company. Immediately following
+the Closing of the Merger, Innocap Inc. changed its business plan to that of UL HI.
+
+ 
+
+On
+January 11, 2021, Innocap Inc. filed a certificate of amendment to its articles of incorporation with the Secretary of State of the State
+of Nevada, for the adoption of amended and restated articles of incorporation of Innocap Inc. (the Amended and Restated Articles
+of Incorporation ). The adopted Amended and Restated Articles of Incorporation: (i) increased the number of authorized common stock
+from 500,000,000 shares to 800,000,000 shares; and (ii) changed the Company s name to Unique Logistics International, Inc. (the
+ Company ).
+
+ 
+
+The
+Name Change was approved by the Financial Industry Regulatory Authority (FINRA) and became effective in the market on January 14, 2021.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+Unique
+Logistics Holdings Management Buyout Transaction
+
+ 
+
+The
+Company s wholly owned subsidiary, Unique Logistics Holdings, Inc. ( Unique ) a Delaware corporation, was formed on
+October 28, 2019, for the purpose of conducting a management buyout of three United States subsidiaries majority owned by Unique Logistics
+Holdings Ltd., a Hong Kong company ( UL HK ) (the Management Buy Out Transaction ).
+
+ 
+
+UL
+HK was incorporated in Hong Kong in 1983. UL HK commenced its business with a focus on transpacific logistics services because of the
+increasing demands of trade between Hong Kong and the United States. The initial focus was on air freight services, but UL HK quickly
+diversified into ocean freight services. In its first fifteen years of operations, UL HK established itself as a major international
+logistics service provider in Hong Kong. Driven by the needs of its customer base, from 1997 through 2012, UL HK established a network
+of offices throughout Asia and the United States. By the end of 2012, the Unique Logistics brand was well recognized in several Asian
+countries including China, India, and Vietnam. In the United States, UL HK offices in Boston, Atlanta, New York, Los Angeles, and Chicago
+had a growing United States customer base in several sectors such as fashion, department stores, furniture, toys, and home goods. The
+vast majority of ULHK s international business consisted of services pertaining to United States based companies.
+
+ 
+
+On
+May 29, 2020 (the Buyout Transaction Date ), Unique entered into that certain Securities Purchase Agreement ( UL
+HK Purchase Agreement ) by and between Unique and UL HK, pursuant to which the Company purchased from UL HK (i) sixty percent (60%)
+of the membership interests of Unique Logistics International (ATL) LLC, a Georgia limited liability company ( UL ATL );
+(ii) eighty percent (80%) of the common stock of Unique Logistics International (BOS) Inc, a Massachusetts corporation ( UL BOS );
+and (iii) sixty-five percent (65%) of Unique Logistics International (USA) Inc., a New York corporation, a sole owner of Unique Logistics
+International (NYC), Inc. ( UL NYC ), for a purchase price of: (i) US$6,000,000, to be paid in accordance with the following
+(a) $1,000,000 in cash (the UL HK Cash Purchase Price ); (b) $5,000,000 in the form a subordinated promissory note issued
+in favor of UL HK and (c) 1,500,000 shares of common stock of Unique Logistics Holdings, representing on issuance 15% of fully paid and
+non-assessable shares of common stock then outstanding on a fully diluted basis (the UL HK Stock Purchase Price ). Pursuant
+to the UL HK Purchase Agreement, Unique has been granted an option to purchase 50% of UL HK s interest in Unique Logistics International
+(North and East China) Company Limited and its affiliated companies (collectively UL China ) and has been granted an option
+to purchase 65% of UL HK s interest in Unique Logistics International India (Private) Limited ( UL India ) within 12
+months of the Buyout Transaction Date.
+
+ 
+
+In
+connection with the Management Buyout Transaction, Unique also entered into three separate securities purchase agreements with the minority
+interest holders of UL ATL (the UL ATL Transaction ), UL BOS (the UL BOS Transaction ) and UL NYC (the UL
+NYC Transaction ), respectively, whereby, together with the consummation of the Management Buy Out Transaction, each such entity
+became a wholly owned subsidiary of Unique Logistics Holdings.
+
+ 
+
+BUSINESS
+
+ 
+
+Unique
+Logistics primary services include:
+
+ 
+
+ 
+ 
+ 
+ Air
+ Freight services
+
+ 
+ 
+ 
+ Ocean
+ Freight services
+
+ 
+ 
+ 
+ Customs
+ Brokerage and Compliance services
+
+ 
+ 
+ 
+ Warehousing
+ and Distribution services
+
+ 
+ 
+ 
+ Order
+ Management
+
+ 
+ 
+
+Air
+Freight Services
+
+ 
+
+Operating
+as an Indirect Air Carrier (IAC) or an airfreight consolidator, Unique Logistics provides both time savings and cost-effective air freight
+options to its customers. An expansive global network enables the Company to offer door to door service allowing customers to benefit
+from our expert staff for guidance with the physical movement of cargo and documentation compliance. Unique purchases cargo space from
+airlines on a volume basis and resells that space to our customers at a lower price than they would be able to negotiate themselves for
+their individual shipments. The Company, through its integrated management system, determines the best routing for shipments and then
+arrangements are made to receive the cargo into a designated warehouse. Upon receipt, cargo is inspected and weighed, documentation is
+collected and export clearance is processed. Once cargo is cleared it is prepared for departure. Unique Logistics offers real-time tracking
+visibility for customers to view when an order is booked, departs and arrives. Unique Logistics contracts with a worldwide network of
+airlines and other service providers to provide the best airfreight service in assisting importers to ship using the most efficient and
+cost-effective method. Some of the selections we offer include:
+
+ 
+
+ 
+ 
+ 
+ Domestic,
+ deferred, express and charter services, which permit customers to choose from a menu of different priority options that secure at
+ different price levels, greater assurance of timely delivery
+
+ 
+ 
+ 
+ Port
+ to Port and Door to Door shipments, which provide customers the option of managing, independently, the post arrival services such
+ as delivery or clearance if the Company is not providing such services
+
+ 
+ 
+ 
+ Global
+ blocked space agreements (BSA), which guarantee the availability of space on certain flights
+
+ 
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Air
+ and ocean combination shipment which offer cost effective transportation using multimodal, combination movements, by one mode to
+ an international hub, such as Dubai, UAE or Singapore and converting to a different mode at the hub
+
+ 
+ 
+ 
+ Air
+ and transload dedicated truck shipment, where arriving cargo is transferred from airline container or pallet into a truckload ready
+ for delivery
+
+ 
+ 
+ 
+ Dangerous
+ goods handling requiring qualified handling
+
+ 
+ 
+ 
+ Refrigerated
+ cargo
+
+ 
+ 
+
+The Company s integrated management system
+is built around a cloud-based software package known as Cargo Wise. The software is accessible to our offices or overseas affiliate when
+planning and recording the receipt of cargo and booking shipments. The Cargo Wise system assists in the creation of documentation required
+to plan each shipment, including Management Information Systems that enable our Operational Management Teams to generate reports or provide
+access to information to our customers so that they have daily visibility to their purchased orders. This enables shipments to be approved,
+planned and routed within the available air freight capacity procured by the Company. The Cargo Wise software is part of the integrated
+management system that also incorporates (in some cases with interface) airline resources, congestion/ market condition information,
+pricing databases, customer preferences in Key Account Management databases and the trained personnel and experienced managers that make
+decisions as required based on the information.
+
+ 
+
+Ocean
+Freight Services
+
+ 
+
+Operating
+as an ocean transportation intermediary ( OTI ) to provide ocean freight service both as a non-vessel owning common carrier
+( NVOCC ) and ocean freight forwarder, Unique Logistics provides to its customers ocean freight consolidation, direct ocean
+forwarding, and order management. We are a common carrier that holds itself out to the public to provide ocean transportation, issues
+its own house bills of lading or equivalent document, but does not operate the vessels by which ocean transportation is provided. The
+Company s roles and responsibilities in ocean freight services include the following:
+
+ 
+
+ 
+ 
+ 
+ Selecting
+ the most optimal ocean carriers based on both cost and service. The Company has NVOCC contracts with multiple ocean carriers and
+ is thus able to offer its customers a choice in service;
+
+ 
+ 
+ 
+ Entering
+ into contract/rate agreement with clients to transport their ocean shipments. Under such contracts the customer is assured of the
+ Company s pricing and weekly capacity to carry the customer s cargo;
+
+ 
+ 
+ 
+ Consolidating
+ shipments at origin/deconsolidating of freight at destination. This enables the customer to receive the economics of a consolidated
+ container rate rather than a higher rate for less than full container load ( LCL ). It also makes delivery at destination
+ more efficient;
+
+ 
+ 
+ 
+ Arranging
+ pick-up of shipment at origin and deliver at destination, with a factory to door service;
+
+ 
+ 
+ 
+ Preparing
+ and processing the documentation/clearance (customs/security) for shipments during ocean transit, in advance of arrival of shipment
+ at destination;
+
+ 
+ 
+ 
+ Ocean
+ freight services are provided in both major and minor trade lanes with representation in all trading nations in Americas, Asia, and
+ Europe;
+
+ 
+ 
+ 
+ Offering
+ a wide array of services typically performed by multiple services providers including but not limited to, offering options to customers
+ on ocean carrier service choices prior to final selection and securing such space based on customer requirement; this enables our
+ customers to delegate more of its logistics management to us whereas a more limited range of service would require the customer to
+ deal with multiple service providers;
+
+ 
+ 
+ 
+ Communicating
+ on any regulation/compliance issues on exporting and importing shipments;
+
+ 
+ 
+ 
+ Playing
+ intermediary role at any point of ocean transportation based on customer s routing preferences; and
+
+ 
+ 
+ 
+ Providing
+ space acquisition on carrier service for committed delivery during high demand period, and providing lower price option in weak demand
+ season for utmost cost saving.
+
+ 
+ 
+
+Customs
+Brokerage and Compliance Services
+
+ 
+
+Unique
+Logistics is a licensed United States customs broker whose mission is to ensure that its importing clients are in compliance with all
+required regulations. Our services help importers clear cargo with the U.S. Customs and Border Protection, including documentation collection,
+valuation review, product classification, electronic submission to customs and the collection and payment of duties, tariffs and fees.
+Unique Logistics works with importers to develop a compliant trade program including product databases, compliance manuals and periodic
+internal audits. The development of product databases has become critical in the current economic environment due to the increasing trade
+tensions and various tariffs imposed as a result. Unique Logistics also offers importers tools to improve on efficiency such as reporting,
+visibility and trade consulting including training seminars. Additional services include:
+
+ 
+
+ 
+ 
+ 
+ Preparation
+ of the Import Security Filing (10+2) required to be on file 24 hours prior to shipment departure;
+
+ 
+ 
+ 
+ Clearance
+ and compliance with other government agencies such as the Food and Drug Administration, U.S. Department of Agriculture, Consumer
+ Product Safety Commission and U.S. Fish & Wildlife Service;
+
+ 
+ 
+ 
+ Focused
+ assessment and internal audit to determine and eliminate weak areas of compliance;
+
+ 
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Post-entry
+ service to change past entries and take advantage of tariff exclusions granted after the original entry was processed;
+
+ 
+ 
+ 
+ Binding
+ rulings to obtain pre-entry classification;
+
+ 
+ 
+ 
+ Classification
+ & valuation;
+
+ 
+ 
+ 
+ Trade
+ agreements;
+
+ 
+ 
+ 
+ Warehouse
+ entries to defer duty;
+
+ 
+ 
+ 
+ Licensing
+ and country of origin marking requirements;
+
+ 
+ 
+ 
+ Free
+ Trade Zone (FTZ);
+
+ 
+ 
+ 
+ Duty
+ drawback to get duty back on items exported under certain requirements; and
+
+ 
+ 
+ 
+ Cargo
+ insurance coverage
+
+ 
+ 
+
+Warehousing
+and Distribution Services
+
+ 
+
+Unique
+Logistics operates a warehousing facility in Santa Fe Springs, CA and plans to expand such services through its own managed facilities.
+Unique Logistics also provides warehousing and distribution services through third party facilities. Our current facility is leased to
+the Company and is 110,000 sq. ft. with storage capacity for around 9,000 pallets and 10 dedicated employees.
+
+ 
+
+Warehousing
+and Distribution services enable Unique Logistics to greatly expand its involvement in our customers supply chain, post arrival
+of international shipments into the United States. By providing inventory management, order fulfillment, and other services, our customers
+benefit from cost savings related to space, equipment and labor due to efficiencies of scale. Our list of Warehousing and Distribution
+Services include the following:
+
+ 
+
+ 
+ 
+ 
+ Transloading
+ of cargo from incoming containers to trucks for delivery
+
+ 
+ 
+ 
+ Pick
+ and pack services
+
+ 
+ 
+ 
+ Quality
+ control services under customer instructions
+
+ 
+ 
+ 
+ Kitting
+
+ 
+ 
+ 
+ Storage
+
+ 
+ 
+ 
+ Inventory
+ management
+
+ 
+ 
+ 
+ Delivery
+ services, including e-Commerce fulfillment services
+
+ 
+ 
+
+Order
+Management
+
+ 
+
+Unique
+Logistics offers order management services providing importers with total visibility on every order from the time placed with the supplier
+to door delivery. Importers send orders electronically immediately upon creation giving the Company the ability to assist in firmly holding
+suppliers to shipping windows. Ultimately this results in optimizing consolidation and improved on-time delivery. Order management also
+gives importers the power to control their supply chain by monitoring key milestone events, track order status and manage delivery to
+the end consumer.
+
+ 
+
+Order
+Management features:
+
+ 
+
+ 
+ 
+ 
+ Importer
+ and vendor EDI integration
+
+ 
+ 
+ 
+ Key
+ milestone notifications customized per importers requirements
+
+ 
+ 
+ 
+ Vendor,
+ booking and document management
+
+ 
+ 
+ 
+ Customized
+ reporting including exception reporting for maximum efficiency
+
+ 
+ 
+ 
+ Consolidation
+ management
+
+ 
+ 
+ 
+ Tracking
+ visibility in real-time
+
+ 
+ 
+
+Other
+Benefits include:
+
+ 
+
+ 
+ 
+ 
+ Single
+ Data Platform
+
+ 
+ 
+ 
+ Avoids
+ a manual booking process
+
+ 
+ 
+ 
+ Eliminates
+ unnecessary data entry
+
+ 
+ 
+ 
+ Document
+ visibility and historical recordkeeping
+
+ 
+
+ 
+
+ 7
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Vendor
+ KPI management
+
+ 
+ 
+ 
+ Live
+ milestone updates
+
+ 
+ 
+
+Seasonality
+
+ 
+
+Historically,
+our own operating results as well as the industry as a whole have been subject to seasonal demand. With our financial year end of May
+31, typically our first and second quarters are the strongest with the fourth quarter being the weakest; however, there are no guarantees
+that these trends will continue or that the COVID-19 pandemic will not cause any other business disruptions. It is widely understood
+in the industry that these seasonal trends are influenced by a number of factors, including weather patterns, national holidays, economic
+conditions, consumer demand, major product launches, as well as a number of other market forces. Since many of these forces are unforeseen
+there is no way for us to provide assurances that these seasonal trends will continue.
+
+ 
+
+Growth
+Strategy
+
+ 
+
+Unique
+Logistics has established plans to grow its business by focusing on four key areas: (1) organic growth and expansion in existing markets;
+(2) strategic acquisitions; (3) warehousing and distribution; and (4) specialized services to United States companies on their overseas
+logistics needs in targeted Asian markets.
+
+ 
+
+Organic
+Growth and Expansion in Existing Markets:
+
+ 
+
+We plan to focus on developing business domestically
+to drive organic growth. Since the Management Buyout Transaction (See Unique Logistics Holdings Management Buyout Transaction ),
+we have significantly improved our operating efficiencies in the areas of procurement, customer service, finance and administration.
+We have achieved this by consolidating our volumes, centralizing many of the functions previously handled separately by individual
+operating subsidiaries and rationalizing our organizational structure to empower experienced executives in critical positions including
+the hiring of a full time Chief Financial Officer. We believe this will result in much lower overhead and the ability to build a
+uniform marketing strategy to build market share and further the brand recognition of Unique Logistics throughout the United States.
+Additionally, the Company will continuously assess its Information Technology environment based on emerging trends in logistics and customer
+requirements. The first step in the strategy is already in place: a single operating platform. We will continue to build add-on service
+tools that enhance our operating platform. One key area for technology focus will be the seamless delivery of e-Commerce services from
+origin to consumer with shipment visibility for both customer and the customer s consumer.
+
+ 
+
+ 8
+
+ 
+
+ 
+
+ 
+
+We
+believe Unique Logistics business base that includes three out of the fifty largest importers in the United States can be expanded
+by building our sales organization and the support organization to successfully deliver our brand of service. The targeted growth areas,
+to secure the business of other major importers as well as exporters, include Charlotte, NC, Dallas, TX, Houston, TX and Seattle,
+WA.
+
+ 
+
+Strategic
+Acquisitions:
+
+ 
+
+We
+currently maintain an option to acquire ownership of significant foreign subsidiaries of Unique Logistics Holdings Ltd. ( ULHK ),
+a Hong Kong company, that are critical to our ability to meet our customers international requirements. Through the Consulting
+Services Agreement between the Company and Great Eagle Freight Limited, ( GEFD) a Hong Kong company, we will ensure that the international
+brand of Unique Logistics and the seamless services provided to customers remains in place even before the options to acquire ULHK s
+foreign subsidiaries are exercised. Additionally, it is our intention to increase our business by seeking additional opportunities through
+potential domestic acquisitions, revenue sharing arrangements, partnerships or investments.
+
+ 
+
+Warehousing
+and Distribution
+
+ 
+
+Unique
+Logistics has successfully established a major warehousing facility in Santa Fe Springs, CA and now has in-house the management expertise
+(commercial as well as operational) in successfully managing such facilities. Unique Logistics has also identified a method of identifying
+growth opportunities by focusing on specific areas of the United States and existing well-constructed facilities where lease assumption
+is available with an existing customer base.
+
+ 
+
+Specialized
+Services to US Companies in Overseas Markets
+
+ 
+
+Unique
+Logistics has several decades of experience in Asian markets such as China, India, Vietnam and Indonesia. Unique Logistics is constantly
+dealing with a United States customer base that seeks to do business in these areas but requires local expertise. We have the experience
+and the connections to assist United States companies with local importation, local warehousing and distribution and other local logistics
+and trade compliance services. We plan to build on our expertise in these four specific countries to build tailored services to US customers,
+including in business consulting pertaining to logistics and related trade services.
+
+ 
+
+Government
+Regulations and Security
+
+ 
+
+Our
+industry is subject to regulation and supervision by several governmental authorities.
+
+ 
+
+Operations
+
+ 
+
+The
+U.S. Department of Transportation ( DOT ), the Federal Aviation Administration ( FAA ) and the U.S. Department
+of Homeland Security, through the Transportation Security Administration ( TSA ), have regulatory authority over our air
+transportation services. The Federal Aviation Act of 1958, as amended, is the statutory basis for DOT and FAA authority and the Aviation
+and Transportation Security Act of 2001, as amended, is the basis for TSA aviation security authority.
+
+ 
+
+All
+United States indirect air carriers are required to maintain prescribed security procedures and are subject to periodic audits by the
+TSA. Our overseas offices and agents are licensed as airfreight forwarders in their respective countries of operation. Our offices are
+licensed as an airfreight forwarder from the International Air Transport Association (IATA), a voluntary association of airlines and
+air transport related entities that prescribes certain operating procedures for airfreight forwarders acting as agents for its members.
+
+ 
+
+The
+shipping of goods by sea is regulated by the Federal Maritime Commission ( FMC ). Our Company is licensed by the FMC to operate
+as an Ocean Transportation Intermediary ( OTI ) and as an NVOCC. As a licensed OTI and NVOCC, we are required to comply with
+several regulations, including the filing of our tariffs.
+
+ 
+
+Under
+Department of Homeland Security regulations, we are a qualified participant in the Customs- Trade Partnership Against Terrorism ( C-TPAT )
+program requiring us to be compliant with relevant security procedures in our operations.
+
+ 
+
+ 9
+
+ 
+
+ 
+
+ 
+
+We
+are licensed as a customs broker by the U.S. Customs and Border Protection (CBP) Agency of DHS, nationally and in each U.S. customs district
+in which we do business. All United States customs brokers are required to maintain prescribed records and are subject to periodic audits
+by CBP. In other jurisdictions in which we perform customs clearance services, we are licensed by the appropriate governmental authority
+where such license is required to perform these services.
+
+ 
+
+We
+do not believe that current United States and foreign governmental regulations impose significant economic restraint upon our business
+operations. However, the regulations of foreign governments can impose barriers to our ability to provide the full range of our business
+activities in a wholly or majority United States-owned subsidiary. For example, foreign ownership of a customs brokerage business is
+prohibited in some jurisdictions and, less frequently, the ownership of the licenses required for freight forwarding and/or freight consolidation
+is restricted to local entities. When we encounter this sort of governmental restriction, we work to establish a legal structure that
+meets the requirements of the local regulations, while also providing the substantive operating and economic advantages that would be
+available in the absence of such regulation. This can be accomplished by creating a joint venture or exclusive agency relationship with
+a qualified local entity that holds the required license.
+
+ 
+
+Environmental
+
+ 
+
+We
+are subject to federal, state and local environmental laws and regulations across all of our business units. These laws and regulations
+cover a variety of processes, including, but not limited to: proper storage, handling and disposal of waste materials; appropriately
+managing wastewater and stormwater; monitoring and maintaining the integrity of underground storage tanks; complying with laws regarding
+clean air, including those governing emissions; protecting against and appropriately responding to spills and releases and communicating
+the presence of reportable quantities of hazardous materials to local responders. We have established site- and activity-specific environmental
+compliance and pollution prevention programs to address our environmental responsibilities and remain compliant. In addition, we have
+created several programs which seek to minimize waste and prevent pollution within our operations.
+
+ 
+
+Employees
+and Human Capital
+
+ 
+
+As
+of August 30, 2021, the Company had 108 employees. None of our employees are represented by a union or covered by a collective bargaining
+agreement. We have not experienced any work stoppages and we consider our relationship with our employees to be good.
+
+ 
+
+Our
+human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing
+and new employees, advisors and consultants. The principal purposes of our equity incentive plan is to attract, retain and reward personnel
+through the granting of stock-based compensation awards, in order to increase stockholder value and the success of our company by motivating
+such individuals to perform to the best of their abilities and achieve our objectives.
+
+ 
+
+Properties
+
+ 
+
+Our
+corporate headquarters are currently located at 154-09 146th Avenue, Jamaica, NY 11434 where we occupy 2,219 square feet.
+Monthly rent for this space is approximately $5,000 per month and our lease expires on April 30, 2024.
+
+ 
+
+A
+full list of properties leased by the Company are set out below:
+
+ 
+
+ 
+ LOCATION 
+ LEASE 
+ MONTHLY 
+ SQUARE 
+ 
+
+ 
+ CITY,
+ STATE 
+ EXPIRATION 
+ RENT 
+ FEET 
+ FUNCTION
+
+ 
+ JAMAICA,
+ NY 
+ 4/30/2024 
+ $4,813.75 
+ 2,219 
+ OFFICE
+
+ 
+ JAMAICA,
+ NY 
+ 7/15/2022 
+ $4,000.00 
+ 1,440 
+ WAREHOUSE
+
+ 
+ ATLANTA,
+ GA 
+ 10/31/2028 
+ $13,227.67 
+ 5,669 
+ OFFICE
+
+ 
+ CHELSEA,
+ MA 
+ 9/30/2022 
+ $900.00 
+ 600 
+ OFFICE
+
+ 
+ MIDDLETON,
+ MA 
+ 7/31/2025 
+ $10,620.75 
+ 5,202 
+ OFFICE
+
+ 
+ SANTA
+ FE SPRINGS, CA 
+ 10/15/2022 
+ $108,410.96 
+ 110,791 
+ WAREHOUSE/
+ OFFICE
+
+ 
+ CHARLOTTE,
+ NC 
+ 6/302025 
+ $3,896.06 
+ 1,889 
+ OFFICE
+
+ 
+ ITASCA,
+ IL 
+ 5/31/2026 
+ $4,383.75 
+ 2,338 
+ OFFICE
+
+ 
+ ROANOKE,
+ VA 
+ 6/1/2022 
+ $595.57 
+ 685 
+ OFFICE
+
+ 
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+Our
+spaces are utilized for office and warehouse purposes, and it is our belief that the spaces are adequate for our immediate needs. Additional
+space may be required as we expand our business activities. We do not foresee any significant difficulties in obtaining additional facilities
+if deemed necessary.
+
+ 
+
+Legal
+Proceedings
+
+ 
+
+The
+Company is not involved in any disputes and does not have any litigation matters pending which the Company believes could have a materially
+adverse effect on the Company s financial condition or results of operations. There is no action, suit, proceeding, inquiry or
+investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge
+of the executive officers of our Company or any of our subsidiaries, threatened against or affecting our Company, our common stock, any
+of our subsidiaries or of our Company s or our Company s subsidiaries officers or directors in their capacities as
+such, in which an adverse decision could have a material adverse effect.
+
+ 
+
+However,
+from time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. Litigation
+is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.
+
+ 
+
+Industry
+Overview and Competition
+
+ 
+
+The
+global logistics industry is highly competitive, and we expect it to remain so for the foreseeable future. Although there is a
+large number of companies that compete or provide services in one or more segments of the logistics industry, Unique Logistics is part
+of a much smaller group of companies that provides a full suite of services. We provide a range of logistics services within the spectrum
+of the supply chain and in each area of service we face competition from companies operating within that service segment as well as companies
+that provide a wider range of global services.
+
+ 
+
+The
+industry includes specialized Non-Vessel Owning Common Carriers ( NVOCCs ) and Indirect Air Carriers ( IACs ),
+freight forwarders, trucking companies, customs brokers and warehouse operators who operate within their specialized space and very often
+pose pricing advantages within that segment. We often compete with them, just as we compete against larger players who provide all or
+most of such services.
+
+ 
+
+Our
+mission is to bring value to our customers over a wide range of the supply chain through specific competitive advantages:
+
+ 
+
+ 
+ 
+ 
+ Trained,
+ experienced staff with knowledge of those areas of the world where customers are likely to require problem solving abilities.
+
+ 
+ 
+ 
+ Trained,
+ experienced staff with knowledge of the various supply chain segments: Air, Ocean, Customs, Warehousing and Information Technology
+ integration.
+
+ 
+ 
+ 
+ Responsive
+ customer service and the ability to meet our customer needs with people at the front of well-established processes.
+
+ 
+ 
+
+Impact
+of Covid on Business
+
+ 
+
+Our
+customer base includes several customers whose business involves retail to the public through brick and mortar stores, many of them in
+shopping malls. In the period February 2020 to May 2020, many such customers faced significant downturn in their business resulting in
+shut down of supply chains and business loss for our Company. The Company secured PPP loans from the government that enabled us to maintain
+our operations and meet our overhead commitments in this period. Driven initially by online retail and later by the opening of in-person
+retail, by February 2021 most of our customers saw their business recover to pre-pandemic levels.
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+Our
+Risks and Challenges
+
+ 
+
+An
+investment in our securities involves a high degree of risk. You should carefully consider the risks summarized below. The risks are
+discussed more fully in the Risk Factors section of this prospectus immediately following this prospectus summary. These
+risks include, but are not limited to, the following:
+
+ 
+
+ 
+ 
+ 
+
+ 
+
+ We
+ have customer who are retailers and thus subject to the impact of Covid related risks and restrictions;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ depend on operators of aircrafts, ships, trucks, ports and airports;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ past acquisition, as well as any acquisitions that we may complete in the future, may be unsuccessful or result in other risks or
+ developments that adversely affect our financial condition and result;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ derive a significant portion of our total revenues and net revenues from our largest customers;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Due
+ to our dependence on a limited number of customers, we are subject to a concentration of
+ credit risk;
+
+ 
+
+ 
+ 
+ 
+ We
+ rely on technology to operate our business; 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ earnings may be affected by seasonal changes in the transportation industry;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ business is affected by ever increasing regulations from a number of sources in the United States and in foreign locations in which
+ we operate;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ As
+ a multinational corporation, we are subject to formal or informal investigations from governmental authorities or others in the countries
+ in which we do business; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ global economy and capital and credit markets continue to experience uncertainty and volatility.
+
+ 
+ 
+
+Recent
+Developments
+
+ 
+
+Information
+Statement
+
+ 
+
+On
+November 29, 2021, the Company filed an Information Statement with the SEC for the holders of record of the outstanding common stock,
+informing them of the actions to be effective at least 20 days after the mailing of the Information Statement. Contemplated actions are:
+
+ 
+
+ A
+ reverse stock split of the Company s issued and outstanding shares of Common Stock
+ (the Reverse Stock Split ) with a ratio within the range of 1-for-300 to 1-for-400
+ (the Reverse Stock Split Ratio )
+
+ A
+ decrease in the number of authorized shares of Common Stock from 800,000,000 shares to 250,000,000
+ shares.
+
+ The
+ filing of an amendment to our Articles of Incorporation, as amended, to affect the Reverse
+ Stock Split and the Decrease in Authorized Shares. 
+
+ Amendment
+ to the Unique 2020 Equity and Incentive Plan (the 2020 Plan ) to set the number
+ of shares of the Company s Common Stock available for issuance under the 2020 Plan
+ to 1,500,000 shares effective upon the Reverse Stock Split.
+
+ 
+
+Securities
+Exchange Agreement
+
+ 
+
+On
+August 19, 2021, we entered into a securities exchange agreement (the Exchange Agreement ) with certain holders holding
+notes and warrants of the Company (each, including its successors and assigns, a Holder and collectively the Holders ).
+Pursuant to the Exchange Agreement, the Company agreed to issue, and the Holders agreed to acquire the New Securities (as defined herein)
+in exchange for the Surrendered Securities (as defined in the Exchange Agreement). New Securities means a number of Exchange
+Shares (as defined in the Exchange Agreement) determined by applying the Exchange Ratio (as defined in the Exchange Agreement) upon consummation
+of a registered public offering of shares of the Company s Common Stock (and warrants if included in such financing), at a valuation
+of not less than $200,000,000.00 pre-money, pursuant to which the Company receives gross proceeds of not less than $20,000,000 and the
+Company s Trading Market is a National Securities Exchange (the Qualified Financing ).
+
+ 
+
+In
+the event the number of Exchange Shares would result in the Holder beneficially owning more than the Beneficial Ownership Limitation
+(as defined in the Exchange Agreement), all such Exchange Shares in excess of the Beneficial Ownership Limitation shall be issued as
+a number of shares of newly created Series C Convertible Preferred Stock.
+
+ 
+
+ 12
+
+ 
+
+ 
+
+ 
+
+The
+closing will occur on the Trading Day on which all of the Transaction Documents (as defined in Exchange Agreement) have been executed
+and delivered by the applicable parties thereto, and all conditions precedent to (i) the Holders obligations to tender the Surrendered
+Securities at such Closing, and (ii) the Company s obligations to deliver the New Securities, in each case, have been satisfied
+or waived (the Closing Date ).
+
+ 
+
+The
+respective obligations of the Holders under the Exchange Agreement in connection with the closing are subject to the following conditions
+being met, including a) the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality
+or Material Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained
+therein (unless as of a specific date therein in which case they shall be accurate as of such date); b) all obligations, covenants and
+agreements of the Company required to be performed at or prior to the Closing Date shall have been performed; c) The Company shall have
+closed the Qualified Financing; d) the delivery by the Company of the items set forth in Section 2.2(a) of the Exchange Agreement; e)
+there shall have been no Material Adverse Effect with respect to the Company since the date thereof; f) though the Closing Date, trading
+in the Common Stock shall not have been suspended by the Commission or the Company s principal Trading Market, and, at any time
+prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall not have been suspended or limited, or
+minimum prices shall not have been established on securities whose trades are reported by such service, or on any Trading Market, nor
+shall a banking moratorium have been declared either by the United States or New York State authorities nor shall there have occurred
+any material outbreak or escalation of hostilities or other national or international calamity, pandemic, wide spread national public
+health emergency, of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in
+the reasonable judgment of such Holder, makes it impracticable or inadvisable to acquire the securities at the closing.
+
+ 
+
+The
+Exchange Agreement can be terminated by any Holder, as to such Holder s obligations thereunder only and without any effect whatsoever
+on the obligations between the Company and the other Holders, by written notice to the other parties, if the Qualified Financing was
+not completed by, has not been consummated on or before the termination date or the Closing fails to occur as a result of any action
+or inaction by the Company within five (5) days after the Closing of the Qualified Financing.
+
+ 
+
+Registration
+Rights Agreement
+
+ 
+
+In
+connection with the Exchange Agreement, the Company entered into a Registration Rights Agreement (the Registration Rights Agreement )
+with the Holders, pursuant to which the Company agreed to register the Registrable Securities (as defined in the Registration Rights
+Agreement).
+
+ 
+
+Pursuant
+to the Registration Rights Agreement, the Company is required with respect to the registration statement filed in connection with the
+Qualified Financing (the Qualified Financing Registration Statement ), on or prior to each filing date, to prepare and file
+with the SEC a Registration Statement (as defined below) covering the resale of all of the Registrable Securities that are not then registered
+on an effective Registration Statement for an offering to be made on a continuous basis pursuant to Rule 415.
+
+ 
+
+The
+Qualified Financing Registration Statement shall include Registrable Securities only on behalf of 3a Capital Establishment, comprised
+of 25,000,000 shares of Common Stock currently held by 3a Capital Establishment, which, if such 25,000,000 shares is not equal to $1,000,000
+of value valued at the lowest price at which shares of Common Stock are issued in the Qualified Financing, shall be increased or decreased
+to a number of shares of Common Stock equal to $1,000,000 valued at the lowest price at which shares of Common Stock are issued in the
+Qualified Financing. Each other Registration Statement to be filed under the Registration Rights Agreement shall include all Registrable
+Securities, except as described above.
+
+ 
+
+ 13
+
+ 
+
+ 
+
+ 
+
+Leak-Out
+Agreement
+
+ 
+
+In
+connection with the Exchange Agreement, the Company and the Holders agreed to enter into a Leak-Out Agreement (the Leak-Out Agreement)
+with the Holders upon consummation of a closing of the Exchange Agreement. Pursuant to the Leak-Out Agreement, the Holder would agree
+that, for a period (the Leak-Out Period ) beginning on the date of the Leak-Out Agreement and ending on, and including,
+the date that is ninety (90) days after the Closing Date of the Exchange Agreement, the Holders will not, without the prior written consent
+of EF Hutton (a) offer, sell, contract to sell, pledge, transfer, assign or otherwise dispose of (including, without limitation, by making
+any short sale, engage in any hedging, monetization or derivative transaction) or file (or participate in the filing of) a registration
+statement or prospectus with the SEC in respect of, or establish or increase a put equivalent position or liquidate or decrease a call
+equivalent position within the meaning of Section 16 of the Exchange Act and the rules and regulations of the SEC promulgated thereunder
+with respect to (i) any Common Stock or (ii) any other securities of the Company that are substantially similar to Common Stock or any
+securities convertible into or exchangeable or exercisable for, or any options or warrants or other rights to purchase Common Stock (the
+ Related Securities ), (b) enter into any swap or other arrangement that transfers to another, in whole or in part, any of
+the economic consequences of ownership of Common Stock or Related Securities, whether any such transaction is to be settled by delivery
+of Common Stock or such other securities, in cash or otherwise, or (c) publicly announce an intention to effect any transaction specified
+in clause (a) or (b).
+
+ 
+
+Notwithstanding
+the foregoing, the restrictions described above shall not apply to shares of Common Stock or Related Securities for an amount of Common
+Stock and Related Securities less than 7.5% of the daily average composite trading volume of the Common Stock as reported by Bloomberg,
+LP for any trading day for the principal trading market for the Common Stock and further provided, that the foregoing restriction shall
+not apply to any actual long (as defined in Regulation SHO of the Securities Exchange Act of 1934, as amended) sales by
+the Undersigned or any of the Affiliates at a price greater than 25% higher than the offering price of the lowest priced Common Stock
+sold in the Offering (in each case, as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar
+events occurring after the date hereof).
+
+ 
+
+Amended
+Securities Exchange Agreement
+
+ 
+
+On
+December 10, 2021, the Company entered into an amended securities exchange agreement (the Amended Exchange Agreement ) with
+3A Capital Establishment and Trillium Partners LP3, (each, including its successors and assigns, a Holder and collectively
+the Holders ), which hold those certain convertible notes and warrants of the Company. Specifically, the Holders hold (i)
+convertible notes, issued by the Company, in the aggregate remaining principal amount of $3,861,160 plus interest; and (ii) warrants
+to purchase an aggregate of 1,140,956,904 shares of common stock of the Company (the Surrendered Securities ). Pursuant
+to the Amended Exchange Agreement, the Company agreed to issue, and the Holders agreed to acquire, in exchange for the Surrendered Securities
+shares of the newly created Series C Convertible Preferred Stock, par value $0.001 per share (the Series C Preferred ) and
+shares of Series D Convertible Preferred Stock, par value $0.001 per share (the Series D Preferred , and together with the
+Series C Preferred, the Preferred Stock ), of the Company, upon entering into the Exchange Amendment.
+
+ 
+
+In
+connection with the Amended Exchange Agreement, each of the Holders received that certain number of Preferred Stock equal to one share
+of Preferred Stock for every $10,000.00 of Note Value held by such Holder (the Exchange Ratio ). Specifically, the Company
+issued approximately 194.66 shares of Series C Preferred and issued approximately 191.45 shares of Series D Preferred. In the aggregate,
+each of the Series C Preferred and Series D Preferred may be converted up to an amount of common stock equal to 12.48% of the Company s
+capital stock on a Fully Diluted Basis (as defined below), subject to adjustment. The designations, rights, preferences and privileges
+of the Series C Preferred and Series D Preferred are further described below (the CODs ).
+
+ 
+
+Upon
+effectiveness of the Amended Exchange Agreement, the Company no longer has any outstanding convertible notes or warrants.
+
+ 
+
+Amended
+Registration Rights Agreement
+
+ 
+
+In
+connection with the Amended Exchange Agreement, on December 10, 2021, the Company entered into a registration rights agreement (the Registration
+Rights Agreement ) with the Holders, pursuant to which the Company agreed to register the shares of common stock underlying the
+Preferred Stock (the Registrable Securities ). The Registration Rights Agreement shall replace and supersede the Registration
+Rights Agreement dated as of August 19, 2021, between the Company and the Holders.
+
+ 
+
+Pursuant
+to the Registration Rights Agreement, the Company is required to (A) file the Initial Registration Statement (as defined in the Registration
+Rights Agreement) on or prior to the earlier of (i) the initial filing date of a registration statement in connection with the Qualified
+Financing Registration Statement (as defined in the Amended Exchange Agreement), or (ii) September 30, 2022; and (B) file the Subsequent
+Registration Statement (as defined in the Registration Rights Agreement) on the 30th calendar day after the initial closing of the Qualified
+Financing.
+
+ 
+
+The
+Qualified Financing Registration Statement shall include Registrable Securities only on behalf of one of the Holders, comprised of 25,000,000
+shares of common stock currently held by such Holder, which, if such 25,000,000 shares is not equal to $1,000,000 of value valued at
+the lowest price at which shares of common stock are issued in the Qualified Financing, shall be increased or decreased to a number of
+shares of common stock equal to $1,000,000 valued at the lowest price at which shares of common stock are issued in the Qualified Financing.
+Each other Registration Statement to be filed under the Registration Rights Agreement shall include all Registrable Securities, except
+as described above.
+
+ 
+
+Series
+C and D Preferred Stock
+
+ 
+
+The
+Company has designated 200 shares of preferred stock, $0.001 par value per share, for each of the Series C Preferred and Series D Preferred.
+The holders of the Preferred Stock shall be entitled to receive, upon liquidation, dissolution or winding up of the Company, the amount
+of cash, securities or other property to which such holder would be entitled to receive with respect to such shares of Preferred Stock
+if such shares had been converted to common stock immediately prior to such liquidation.
+
+ 
+
+ 14
+
+ 
+
+ 
+
+ 
+
+Holders
+of the Preferred Stock shall have no voting rights. However, as long as any shares of Preferred Stock are outstanding, the Company shall
+not, without the affirmative vote of the holders of a majority of the then outstanding series of Preferred Stock, (a) disproportionally
+alter or change adversely the powers, preferences or rights given to the Preferred Stock or alter or amend the CODs, (b) amend its certificate
+of incorporation or other charter documents in any manner that disproportionally adversely affects any rights of the holders of the Preferred
+Stock, (c) increase or decrease the number of authorized shares of each series of Preferred Stock or (d) enter into any agreement with
+respect to any of the foregoing.
+
+ 
+
+Each
+share of Preferred Stock shall be convertible, at any time and from time to time from and after the date of issuance, at the option of
+the holder thereof, into a number of shares of common stock determined in accordance with the applicable Conversion Ratio, calculated
+on the Conversion Date (as defined in the CODs), assuming that all options, warrants or other convertible securities or instruments or
+other rights to acquire common stock or any other existing or future classes of capital stock have been exercised or converted, as applicable,
+in full, regardless of whether any such options, warrants, convertible securities or instruments or other rights are then vested or exercisable
+or convertible in accordance with their terms (the Fully Diluted Basis ).
+
+ 
+
+The
+Conversion Ratio for each share of Series C Preferred, and Series D Preferred, shall be a number of shares of common stock equal to 0.064113%,
+and 0.0651869%, respectively, (or up to maximum of 24.96% in the aggregate) of the Company s common stock, on a Fully Diluted Basis
+(the Conversion Ratio ). The Conversion Ratio is subject to an adjustment in connection with any dilutive issuances, whereby
+prior to an Anti-Dilution Termination Event (as defined below), in order to maintain the Conversion Ratio, the Fully Diluted Basis shall
+be calculated as of the Conversion Date and after an Anti-Dilution Termination Event the Conversion Ratio will be set to the Fully Diluted
+Basis as of the moment after the Anti-Dilution Termination Event. an Anti-Dilution Termination Event shall mean the earlier
+of (i) September 30, 2022, or (ii) the closing of the Qualified Financing.
+
+ 
+
+The
+Conversion Ratio is also subject to adjustments in connection with stock dividends, stock splits, fundamental transactions and subsequent
+rights offerings, as fully described in the CODs.
+
+ 
+
+Each
+holder of Preferred Stock shall be subject to limitations on conversions, with such limitations providing that no conversion shall be
+effected which would result in the converting holder beneficially owning in excess of 9.99% of the shares of the Company s common
+stock outstanding immediately after giving effect to such conversion (the Beneficial Ownership Limitation ). By written
+notice to the Company, a holder of Series C Preferred may from time to time increase or decrease the Beneficial Ownership Limitation
+upon 61-day written notice to the Company. The Beneficial Ownership Limitation shall be calculated in accordance with Section 13(d) of
+the Exchange Act.
+
+ 
+
+Term
+Sheet
+
+ 
+
+On
+August 23, 2021, the Company and Unique Logistics Limited, Hong Kong ( ULHK ) entered into a non-binding term sheet (the
+ Term Sheet ) for the Company s purchase from ULHK of (i) 65% of the capital stock of Unique Logistics International
+India (Private) Ltd.; (ii) 50% of the capital stock of ULI (North & East China) Company Limited; (iii) 50% of the capital stock of
+Unique Logistics International (Shanghai) Co. Ltd; (iv) 50% of the capital stock of ULI International Co. Ltd.; (v) 49.99% of TGF Unique
+Limited; (vi) 100% of the capital stock of Unique Logistics International (H.K.) Limited; (vii) 65% of the capital stock of Unique Logistics
+International (Vietnam) Co. Ltd.; (viii) 70% of the capital stock of ULI (South China) Limited; (ix) 100% of the capital stock of Unique
+Logistics International (South China) Ltd.; and (x) 100 of the capital stock of Shenzhen Unique Logistics Limited (collectively the ULHK
+Entities )(the ULHK Entities Acquisition ). The initial purchase price, subject to adjustment, to be paid for the
+ULHK Entities is $22,000,000 (the Acquisition Purchase Price ) payable as follows (i) $21,000,0000 payable at closing (ii)
+$1,000,000 in the form of a zero interest 24 month promissory note. Seller shall also be entitled to an additional $2,500,000 payable
+(the Earn-Out Payment ) by March 31, 2023 in the event that ULHK Entities EBITDA exceeds $5,000,000 for the calendar year
+of 2022. Should ULHK Entities EBITDA be less than $5,000,000 but more than $4,500,000 for the 2022 calendar year, the Earn-Out Payment
+will be adjusted to $2,000,000. No Earn-Out will be paid if the EBITDA of the ULHK Entities is less than $4,500,000 for the 2022 calendar
+year.
+
+ 
+
+ 15
+
+ 
+
+ 
+
+ 
+
+The
+purchase of ULHK Entities is subject to, among other things, due diligence, receipt and review of definitive agreements, receipt of certain
+regulatory approvals, audited financial statements, material third part consents and consent of minority shareholders of ULHK Entities
+
+ 
+
+Amended and Restated Promissory
+Note
+
+ 
+
+On April 7, 2021, the Company entered into an
+Amended and Restated Promissory Note (the Amended and Restated Note ) with Trillium Partners ( Trillium ),
+pursuant to which the Company and Trillium amended and restated in its entirety that certain promissory note, issued to Trillium on
+March 19, 2020 (the Original Note ). The Amended and Restated Note was to mature on June 15, 2021 (the Maturity
+Date ). On September 23, 2021, the Company further amended the Amended and Restated Note pursuant to which the Company and
+Trillium agreed to extend the maturity date of the Amended and Restated Note to December 31, 2021. On January 6, 2022, the
+Company entered into a third amendment to the Amended and Restated Note pursuant to which the Company and Trillium agreed to extend
+the maturity date of the Amended and Restated Note to March 31, 2022.
+
+ 
+
+TBK Facility Increase 
+
+ 
+
+As
+previously disclosed in the Current Report on Form 8-K filed with the Securities and Exchange Commission (the SEC ) by the
+Company on June 23, 2021, the Company, Unique Logistics Holdings, Inc., a Delaware corporation ( Holdings ), Unique Logistics
+International (NYC), LLC, a Delaware limited liability company ( New York ), Unique Logistics International (BOS), Inc.,
+a Massachusetts corporation ( Boston and, together with the Company, Holdings and New York, collectively, Seller ),
+entered into a Revolving Purchase, Loan and Security Agreement (the TBK Agreement ) dated as of June 1, 2021, with TBK BANK,
+SSB, a Texas State Savings Bank ( Purchaser ), for a facility under which Purchaser will, from time to time, buy approved
+receivables from the Seller. The TBK Agreement provides for Seller to have access to the lesser of (i) $30 million ( Maximum Facility )
+and (ii) the Formula Amount (as defined in the TBK Agreement) at an interest rate of the highest prime rate (but in no event less than
+3.25%) plus 3%.
+
+ 
+
+On
+August 4, 2021, the parties to the TBK Agreement entered into a First Amendment Agreement (the First Amendment ) to increase
+the credit facility from $30 million to $40 million during the Temporary Increase Period, the period commencing on August 4, 2021, through
+and including December 2, 2021, with all other terms of the original TBK Agreement remained unchanged.
+
+ 
+
+On
+September 17, 2021, the parties to the TBK Agreement entered into a Second Amendment to the TBK Agreement (the Second Amendment )
+primarily to increase the credit facility from Forty Million Dollars ($40,000,000) to Forty Seven Million Five Hundred Thousand Dollars
+($47,500,000) for the period commencing on August 4, 2021 through and including January 31, 2022.
+
+ 
+
+Purchase
+Money Financing
+
+ 
+
+On
+September 8, 2021 (the Effective Date ), the Company entered into a Purchase Money Financing Agreement (the Financing
+Agreement ) with Corefund Capital, LLC ( Corefund ) in order to enable the Company to finance additional cargo charter
+flights for the peak shipping season.
+
+ 
+
+ 16
+
+ 
+
+ 
+
+ 
+
+Pursuant
+to the Financing Agreement, the Company may, from time to time, request financing from Corefund to enable the Company to engage Company s
+suppliers to provide chartered cargo flights for the Company s clients. The Company may also request that Corefund tender
+payments directly to a supplier. Corefund requires payments from a buyer to be made to a Deposit Account Control Agreement account at
+an agreed upon bank where Corefund is the sole director and accessor to the account for the term of the relationship.
+
+ 
+
+As
+collateral securing its obligations under the Financing Agreement, the Company granted Corefund a continuing security interest in the
+all of the Company s now owned and hereafter acquired Accounts Receivable ( Collateral ) subject to the security interest
+granted pursuant to that certain Revolving Purchase, Loan and Security Agreement, dated as of June 2, 2021. Immediately upon an Event
+of Default (as defined in the Financing Agreement), all outstanding obligations shall accrue interest at the rate of 0.1% (one-tenth
+of one percent) per day. If the Company substantially ceases operating as a going concern, and the proceeds of the Collateral created
+after the occurrence of an Event of Default (the Default ) are in excess of the obligations at the time of Default, the
+Company shall pay to Corefund a liquidation success premium of 10 percent of the amount of such excess.
+
+ 
+
+The
+Financing Agreement contains ordinary and customary provisions for agreements and documents of this nature, such as representations,
+warranties, covenants, and indemnification obligations, as applicable.
+
+ 
+
+SPA-Letter
+Agreement dated June 22, 2021
+
+ 
+
+As
+previously disclosed in the Current Report on Form 8-K filed with the Securities and Exchange Commission (the SEC ) by the
+Company on April 9, 2021, the Company entered into an Amended and Restated Promissory Note (the Amended and Restated Note )
+with an accredited investor (the Investor ), pursuant to which the Company and the Investor amended and restated in its
+entirety that certain promissory note, issued to the Investor on March 19, 2020 (the Original Note ). The Amended and Restated
+Note were to mature on June 15, 2021 (the Maturity Date ). On July 22, 2021, the Company entered into a First Amendment
+to the Amended and Restated Note (the First Amendment ) with the Investor pursuant to which the Company and the Investor
+agreed to extend the maturity date of the Amended and Restated Note by deleting June 15, 2021 in the first paragraph of
+the Amended and Restated Note and replacing the same with October 31, 2021 .
+
+ 
+
+Addendum
+to Recourse Factoring and Security Agreement
+
+ 
+
+As
+previously reported, the Company, Unique Logistics Holdings, Inc., a Delaware corporation ( Holdings ), Unique Logistics
+International (NYC), LLC, a Delaware limited liability company ( New York ), Unique Logistics International (BOS), Inc.,
+a Massachusetts corporation ( Boston and, together with the Company, Holdings and New York, collectively, Seller ),
+entered into a Revolving Purchase, Loan and Security Agreement (the TBK Agreement ) dated as of June 1, 2021, with TBK BANK,
+SSB, a Texas State Savings Bank ( Purchaser ), for a facility under which Purchaser will, from time to time, buy approved
+receivables from the Seller. The TBK Agreement provides for Seller to have access to the lesser of (i) $30 million ( Maximum Facility )
+and (ii) the Formula Amount (as defined in the TBK Agreement) at an interest rate of the highest prime rate (but in no event less than
+3.25%) plus 3%.
+
+ 
+
+As
+previously reported, the TBK Agreement replaced the Company s prior recourse factoring and security agreement with Corefund Capital,
+LLC ( Core ) entered into on May 29, 2020 (the Prior Agreement ), pursuant to which Core agreed to purchase
+from the Company up to an aggregate of $25,000,000 of accounts receivables (the Core Facility ). The Core Facility provided
+Core with security interests in purchased accounts until the accounts was repurchased by the Company or paid by the customer. As of June
+1, 2021, the Core Facility was terminated along with all security interests granted to Core and was replaced with the TBK Agreement.
+
+ 
+
+ 17
+
+ 
+
+ 
+
+ 
+
+Effective
+June 17, 2021, the Company and Core amended the Prior Agreement (the Addendum ) rescinding the Company s termination
+notice of the Prior Agreement. The Addendum provides for a credit line of $2,000,000.00 with no term and no early termination fee which
+is in addition to the facility provided under the TBK Agreement. Pursuant to the Addendum, the Company and Core agreed that Core would
+refile a UCC lien on the Company. The UCC lien will include the following collateral: all seller s assets now owned and hereafter
+acquired accounts; chattel paper; deposit accounts; contract rights; letter of credit rights; instruments; payment and general intangibles;
+goods; inventory; insurance proceeds; equipment and fixtures; investment property; and all books and records relating to all of the foregoing
+property, including without limitation, all computer programs; and all proceeds of the foregoing. All other terms and conditions not
+amended by the Addendum will remain in full force and effect.
+
+ 
+
+Replacement
+of factoring agreement with a revolving line
+
+ 
+
+On
+June 1, 2021, the Company entered into a Revolving Purchase, Loan and Security Agreement (the TBK Agreement ) with TBK BANK,
+SSB, a Texas State Savings Bank ( Purchaser ), for a facility under which Purchaser will, from time to time, buy approved
+receivables from the Seller. The TBK Agreement provides for Seller to have access to the lesser of (i) $30 million ( Maximum Facility )
+and (ii) the Formula Amount (as defined in the TBK Agreement). Upon receipt of any advance, Seller agreed to sell and assign all of its
+rights in accounts receivables and all proceeds thereof. Seller granted to Purchaser a continuing ownership interest in the accounts
+purchased under the Agreement (the Purchased Accounts ) and, secured and as collateral security for all Obligations (as
+defined below), Seller granted to Purchaser a continuing first priority security interest in all of Seller s assets. The facility
+is for an initial term of twenty-four (24) months (the Term ) and may be extended or renewed, unless terminated in accordance
+with the TBK Agreement. The TBK Agreement replaces the Company s prior agreement with Corefund Capital, LLC ( Core )
+entered into on May 29, 2020, pursuant to which Core agreed to purchase from the Company up to an aggregate of $25 million of accounts
+receivables (the Core Facility ). The Core Facility provided Core with security interests in purchased accounts until the
+accounts have been repurchased by the Company or paid by the customer. As of June 1, 2021, the Core Facility has been terminated along
+with all security interests granted to Core and replaced with the TBK Agreement.
+
+ 
+
+On
+August 4, 2021, the parties to the TBK Agreement entered into a First Amendment Agreement (the First Amendment ) to increase
+the credit facility from $30 million to $40 million during the Temporary Increase Period, the period commencing on August 4, 2021, through
+and including December 2, 2021, with all other terms of the original TBK Agreement remained unchanged.
+
+ 
+
+The
+TBK Agreement replaced the Company s prior recourse factoring and security agreement with Corefund Capital, LLC ( Core )
+entered into on May 29, 2020 (the Prior Agreement ), pursuant to which Core agreed to purchase from the Company up to an
+aggregate of $25,000,000 of accounts receivables (the Core Facility ). The Core Facility provided Core with security interests
+in purchased accounts until the accounts was repurchased by the Company or paid by the customer. As of June 1, 2021, the Core Facility
+was terminated along with all security interests granted to Core and was replaced with the TBK Agreement.
+
+ 
+
+Effective
+June 17, 2021, the Company and Core amended the Prior Agreement (the Addendum ) rescinding the Company s termination
+notice of the Prior Agreement. The Addendum provides for a credit line of $2,000,000.00 with no term and no early termination fee which
+is in addition to the facility provided under the TBK Agreement. Pursuant to the Addendum, the Company and Core agreed that Core would
+refile a UCC lien on the Company. The UCC lien will include the following collateral: all seller s assets now owned and hereafter
+acquired accounts; chattel paper; deposit accounts; contract rights; letter of credit rights; instruments; payment and general intangibles;
+goods; inventory; insurance proceeds; equipment and fixtures; investment property; and all books and records relating to all of the foregoing
+property, including without limitation, all computer programs; and all proceeds of the foregoing. All other terms and conditions not
+amended by the Addendum will remain in full force and effect. On August 30, 2021, all remaining factored accounts receivables, approximately
+$1.4 million were repurchased by the Company, the Core Facility was terminated along with all security interests previously granted to
+Core.
+
+ 
+
+Adoption
+of Amended and Restated Articles of Incorporation
+
+ 
+
+Effective
+January 11, 2021, the Company amended and restated its articles of incorporation (the Amended and Restated Articles of Incorporation )
+with the office of the Secretary of State of Nevada to, among other things, (i) change the Company s name to Unique Logistics International,
+Inc. (the Name Change ) and (ii) increase the number of shares of common stock that the Company is authorized to issue from
+500,000,000 shares to 800,000,000 shares (the Increase in Authorized Shares ). The adoption of the Amended and Restated
+Articles of Incorporation was approved by the majority of our stockholders on November 20, 2020.
+
+ 
+
+ 18
+
+ 
+
+ 
+
+ 
+
+On
+January 14, 2021, the Company received notice from Financial Industry Regulatory Authority ( FINRA ) that the Name
+Change had been approved and would take effect at the opening of trading on January 14, 2021. In connection with the Name Change, the
+Company changed its ticker symbol from INNO to UNQL .
+
+ 
+
+Amended and Restated Bylaws
+
+ 
+
+Effective
+as of November 5, 2021, the Company adopted amended and restated bylaws (the Restated Bylaws ).
+
+ 
+
+The
+current organizational structure is illustrated by the following:
+
+ 
+
+ 
+
+ 
+
+Corporate
+Information
+
+ 
+
+Our principal executive offices are located at 154-09
+146th Ave, Jamaica, NY 11434, and our telephone number is 718-978-2000. Our website is www.unique-usa.com.
+Information contained on our website does not constitute part of and is not incorporated into this prospectus.
+
+ 
+
+ 19
+
+ 
+
+ 
+
+ 
+
+SUMMARY
+OF THE OFFERING
+
+ 
+
+ 
+ Issuer:
+ 
+ Unique
+ Logistics International, Inc.
+
+ 
+ 
+ 
+ 
+
+ 
+ Securities
+ Offered:
+ 
+ ____________
+ shares of Common Stock, at a public offering price of $___ per share which is the last reported sale price of our common stock
+ on the OTC Markets on January __, 2022.
+
+ 
+ 
+ 
+ 
+
+ 
+ Over-allotment
+ option 
+ 
+ We
+ have granted to the representative of the underwriters a 45-day option to purchase up to ______ additional shares of our Common Stock
+ at a public offering price of $_____ per share, which is the last reported sale price of our common stock on the OTC Markets on
+ January__, 2022, less the underwriting discounts payable by us, in any combination solely to cover over-allotments, if any.
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ stock outstanding before this offering
+ 
+ 655,781,078
+ Shares
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ stock outstanding after the offering (1)
+ 
+ _______
+ Shares. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds
+
+ 
+ We
+estimate that the net proceeds to us from this offering will be approximately $____ million, or approximately $____ million if the underwriters
+exercise their over-allotment option in full, assuming an offering price of $____ per share, after deducting underwriting discounts and
+estimated offering expenses payable by us. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Representative s Warrants
+ 
+ The registration statement of which this prospectus
+ is a part also registers for sale Warrants (the Representative s Warrants ) to purchase _______ shares of our
+ Common Stock to EF Hutton (the Representative ), as a portion of the underwriting compensation in connection with this
+ offering. The Representative s Warrants will be exercisable at any time, and from time to time, in whole or in part, during
+ the period commencing 180 days following the closing date of this offering and expiring five (5) years from the effective date of
+ the offering at an exercise price of $6.732 (110% of the assumed public offering price per Unit). Please see Underwriting-Representative s
+ Warrants on page 71 of this prospectus for a description of these Warrants.
+
+ 
+ 
+ 
+ 
+
+ 
+ Proposed
+ Nasdaq Capital Market Trading Symbol and Listing
+ 
+ 
+
+Our common stock is quoted on OTC Markets Group,
+Inc., under the symbol UNQL, and, to date, has traded on a limited basis. As of January__, 2022, the last reported sale
+price of our common stock on the OTC Market was $____. We have applied to list our common stock on The Nasdaq Stock Market (the Nasdaq )
+under the symbol UNQL. If Nasdaq does not approve the listing of our common stock, we will not proceed with this offering.
+There can be no assurance that our common stock will be listed on the Nasdaq.
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk
+ Factors
+ 
+ See
+ Risk Factors beginning on page 25 and the other information contained in this prospectus for a discussion of
+ factors you should carefully consider before investing in our securities.
+
+ 
+ 
+ 
+ 
+
+ 
+ Lock-up
+ 
+ We,
+ our directors, executive officers, and shareholders who own 5% or more of our outstanding Common Stock have agreed with the underwriters
+ not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our Common Stock or securities convertible
+ into Common Stock for a period of 180 days, commencing on the date of this prospectus. See Underwriting for additional
+ information.
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer
+ Agent
+ 
+ Action
+ Stock Transfer
+
+ 
+ 
+
+ 
+ 
+ (1)
+ The
+ total number of shares of Common Stock that will be outstanding after this offering is based on 655,781,078 shares of Common
+ Stock outstanding as of January 14, 2022. Unless otherwise indicated, the Shares outstanding after this offering excludes the
+ following:
+
+ 
+ 
+
+ 
+ 
+ 
+ 40,000,000
+ shares of common stock reserved for issuance pursuant to the 2020
+ stock incentive plan (the Stock Incentive Plan ); and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ __________
+ shares of common stock Representative s Warrants.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 6,689,499,576
+ shares of common stock issuable upon conversion of the Company s outstanding Series A and Series B Convertible Preferred Stock.
+
+ 
+ 
+
+ 20
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001353538_appgate_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001353538_appgate_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001353538_appgate_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001442999_alterola_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001442999_alterola_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..b0d5566a635ecac4f1db948cc4212cbb8f66d6ff
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001442999_alterola_prospectus_summary.txt
@@ -0,0 +1 @@
+F-21 Table of Contents ABTI Pharma Limited Consolidated Balance Sheets March 31, 2021 March 31, 2020 ASSETS Current Assets Cash $519 $2 Total Current Assets 519 2 Total Assets $519 $2 Liabilities and Shareholders' Equity (Deficit) Current Liabilities Accounts payable and accrued liabilities $97,130 $ Accounts payable related party 232,665 Loan payable - related party 26,100 Total Current Liabilities 355,895 Total Liabilities 355,895 Shareholders' Deficit Ordinary shares: GBP 1.00 ($1.36) par value 100 shares issued and outstanding 136 3 Additional paid in capital 1,544 Accumulated deficit (343,033) Accumulated other comprehensive loss (14,023) (1) Total Shareholders' Equity (Deficit) (355,376) F-22 Table of Contents ABTI Pharma Limited Consolidated Statements of Comprehensive Loss Year Ended March 31, 2021 2020 Revenue $ $ Operating Expenses: General and administrative 28,838 Professional fees 92,219 Research and development related party 220,512 Total operating expenses 341,569 Operating loss (341,569) Other income (expense) Interest expense (1,464) Total other expense (1,464) Net loss before taxes (343,033) Income tax benefit Net Loss $(343,033) $ Other comprehensive income (loss) Foreign currency translation adjustment (14,022) Comprehensive Loss $(357,055) $ Net loss per ordinary share, basic and diluted $(3,430) $ Basic and diluted weighted average ordinary shares outstanding 100 ABOUT THIS PROSPECTUS This prospectus is part of a registration statement we filed with the Securities and Exchange Commission, or the SEC. Under this registration process, the selling shareholders may, from time to time, offer and sell up to 40,520,000 shares of our common stock, as described in this prospectus, in one or more offerings. This prospectus provides you with a general description of the securities the selling shareholders may offer. You should read this prospectus carefully before making an investment decision. You may only rely on the information contained in this prospectus or that we have referred you to. We have not authorized anyone to provide you with additional or different information. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities other than the shares of our common stock offered by this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any common stock in any circumstances or any jurisdiction in which such offer or solicitation is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front cover of this prospectus regardless of the time of delivery of this prospectus or any sale of our common stock. The rules of the SEC may require us to update this prospectus in the future. As used in this prospectus, unless the context requires otherwise, the terms we , us , our , or the Company refer to Alterola Biotech, Inc. and its subsidiaries on a consolidated basis. References to Selling Shareholders refer to those shareholders listed herein under Selling Shareholders and their successors, assignees and permitted transferees. ABOUT FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act ), and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act ), about the Company and its subsidiaries. These forward-looking statements are intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact, and can be identified by the use of forward-looking terminology such as believes , expects , may , will , could , should , projects , plans , goal , targets , potential , estimates , pro forma , seeks , intends , or anticipates or the negative thereof or comparable terminology. Forward-looking statements include discussions of strategy, financial projections, guidance and estimates (including their underlying assumptions), statements regarding plans, objectives, expectations or consequences of various transactions, and statements about the future performance, operations, products and services of the Company and its subsidiaries. We caution our shareholders and other readers not to place undue reliance on such statements. Our businesses and operations are and will be subject to a variety of risks, uncertainties and other factors. Consequently, actual results and experience may materially differ from those contained in any forward-looking statements. Such risks, uncertainties and other factors that could cause actual results and experience to differ from those projected include, but are not limited to, the risk factors set forth in the section entitled Risk Factors beginning on page 4 of this prospectus. All written or oral forward-looking statements attributable to us or any person acting on our behalf made after the date of this prospectus are expressly qualified in their entirety by the risk factors and cautionary statements contained in and incorporated by reference into this prospectus. Unless legally required, we do not undertake any obligation to release publicly any revisions to such forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. 1 Table of Contents SUMMARY The following summary highlights selected information contained elsewhere in this prospectus and in the documents incorporated by reference in this prospectus and does not contain all the information you will need in making your investment decision. You should read carefully this entire prospectus and the documents incorporated by reference in this prospectus before making an investment decision, especially the information presented under the heading Risk Factors. Business Summary Our goal is to provide better medicines for patients across the globe. We believe in harnessing the therapeutic potential of cannabinoids and cannabinoid- like compounds, which can bring valuable treatments to seriously ill patients. Rather than just focusing on one method of identifying, researching and developing such medicines, we are interested in developing new medicines from all sources including botanical, traditional chemical synthesis and biosynthetic methodologies. On May 28, 2021, we acquired ABTI Pharma Limited, a company registered in England and Wales ( ABTI Pharma ), with the purchase of all of its capital stock in exchange for 600,000,000 shares of our common stock pro rata to the ABTI Pharma shareholders. As a result of the acquisition, we are a pharmaceutical company working with cannabinoid and cannabinoid like molecules. We have three areas of focus: 1) Development of regulated pharmaceuticals (human and animal health) and regulated food products. This has been achieved via the strategic acquisition of Phytotherapeutix Ltd; 2) Production of low cost of goods Active Pharmaceutical Ingredient (API) and food-grade ingredients (supported by the strategic acquisition of Ferven Ltd); and 3) Formulation, and drug delivery, providing improved bioavailability, solubility and stability (supported by the exclusive licensing of IP and technology from Nano4M Ltd). Phytotherapeutix Ltd, a subsidiary of ABTI Pharma, has generated a number of molecules with patents pending, some of which have demonstrable pharmacological activity, similar to that of CBD. This means that some of these molecules are anticipated to have a similar market potential to CBD across a range of therapeutic areas. Ferven Ltd, another subsidiary of ABTI Pharma, is looking to produce cannabinoids by fermentation. The exclusively licensed organism has the potential to be genetically modified to produce multiple cannabinoids at a very low cost of goods. It is anticipated that the selected genetically modified organisms will grow very quickly, which in turn, reduces the cost of production. Nano4M Ltd is a company which has exclusively licensed its nano-formulation patents and know-how to ABTI Pharma Ltd. Recently, on December 2, 2021, we closed an Asset Purchase Agreement (the Purchase Agreement ) with C2 Wellness Corp., a Wyoming corporation, and Dr. G. Sridhar Prasad (together, the Seller ). On the Closing Date, pursuant to the Purchase Agreement, the Company acquired certain IP assets (the Assets ) from Seller, which include: Novel cannabinoid molecules and their associated intellectual property; Novel cannabinoid pro-drugs, and their associated intellectual property; Novel proprietary cannabinoid formulations, designed to target lymphatic delivery, and their associated intellectual property; Novel proprietary nano-encapsulated cannabinoid formulations, in self dissolving polymers, and their associated intellectual property; and Cannabinoids and cannabinoid pro-drug formulations for topical ocular delivery, and their associated intellectual property. In exchange for the Assets, the Company issued to Seller twenty four million (24,000,000) shares of common stock. As a result of the Purchase Agreement and the acquisition of the Assets, and following further research and development, the Company may wish to use the technology platforms and associated intellectual property in the development of its medicines containing cannabinoids and cannabinoid-like compounds or ratios / combinations thereof, which assuming the necessary quality, safety and efficacy can be successfully demonstrated in nonclinical and clinical studies, may bring valuable treatments to seriously ill patients in due course. Additionally, we may consider entering into Joint Venture Partnerships, Acquisition of Companies with complimentary portfolios or Licencing Agreements to enhance the product portfolio. These are strategies the Company may implement and any such opportunities will be assessed on a case by case basis and on their merit at the time. ABTI Pharma management has extensive proven experience, know-how and connections in the cannabinoid medicines sector, and is looking to utilize this knowledge and experience for the development of such medicines from existing cannabinoids and cannabinoid-like molecules. Our address is 47 Hamilton Square Birkenhead Merseyside CH41 5AR United Kingdom. Our telephone number is +44 151 601 9477. Our website is www.alterolabio.com. 3 Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001542022_samba-tv_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001542022_samba-tv_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001542022_samba-tv_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001579026_tower-one_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001579026_tower-one_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..b03eca6231695d869c985e216d7c5716e95d6bd4
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001579026_tower-one_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary Our Business The Company is a pure-play, Build-to-Suit ("BTS") tower owner, operator and developer of multitenant communications real estate. The Company's primary business is the leasing of space on communications sites to mobile network operators in countries it services with non-cancellable lease terms of over 10 years, which include inflation escalators to mitigate global inflationary pressures. In particular, the tower contracts provide for increases in tower rent with inflation to mitigate the increase in costs. The adjustments are made on an annual basis using the consumer price index in Mexico and Colombia. The Company does not currently intend to take any additional actions to mitigate inflation. Each tower is built with an initial anchor tenant commitment and space for an additional 1-3 tenants, or collocations. The Company does not build any towers without an anchor tenant in place. The Company offers tower-related services in the largest Spanish speaking countries in Latin America: Ecuador, Argentina, Colombia and Mexico. These tower-related services include site acquisition, zoning and permitting, structural analysis, and construction which primarily supports the Company's site leasing business, including the addition of new tenants and equipment on its sites. BTS is a process where a long-term lease is secured with a tenant prior to the construction of a tower. Terms are outlined in master lease agreements ("MLAs") with tenants. Products and Services The Company's revenue is primarily derived from tenant leases on the towers it owns and operates in Ecuador, Colombia and Mexico. The lease terms of each structure type are outlined in the MLAs, and these agreements include information about lease amounts by structure type, annual increases and adjustments for local inflation, collocation terms, and minimum infrastructure design requirements. The lease payment amount depends on a number of factors including tower location, height and amount of equipment on the tower. Expenses at the tower site include insurance and maintenance expenses, and in certain cases, property taxes. Ground rent and power and fuel costs are passed through to the Company's tenants. In the tower industry, tower level cash flow ("TCF") is defined as leasing revenue from the tenants less the expenses at the tower site. The Company also received revenue for the sale of certain towers. The Company's operations have been concentrated in Colombia, Argentina, Mexico and the United States. Marketing Our sales team is focused on the goal of securing service orders from multiple mobile network operators in our target market countries, including the United States, Ecuador, Colombia and Mexico. Our priority is to generate additional tenants for our BTS wireless infrastructure. Ultimately, we intend to be the best choice for BTS wireless infrastructure in the countries in which we operate. Our competitive advantage in the marketplace is our ability to develop new sites, arrange permits and build towers specific to our customers' needs. Strategic Relationships We have strategic relationships with several major carriers and municipalities in Latin America including AT&T, Telefonica, America Mobile and Millicom. These relationships have been formalized in our master lease agreements with tenants. Reverse Share Split We intend to complete the Reverse Share Split immediately following the effective date but prior to the closing of the offering of the Common Shares. Risks Associated with Our Business Our business is subject to a number of risks which you should be aware of before making an investment decision. You should carefully consider all of the information set forth in this prospectus and, in particular, should evaluate the specific factors set forth under "Risk Factors" in deciding whether to invest in our shares. These risks include but are not limited to the following: The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, Dated October 27, 2022 Preliminary Prospectus TOWER ONE WIRELESS CORP. Class A Common Shares This is the initial public offering in the United States of ___________ Class A Common Shares (each, a "Common Share") of Tower One Wireless Corp., a British Columbia corporation ("Tower One," the "Company," "we," "us" or "our"). Our Common Shares are currently trading on the Canadian Securities Exchange (the "CSE") under the symbol "TO", the OTCQB under the symbol "TOWTF," and the Frankfurt Stock Exchange (the "FRA") under the symbol "1P3N". We have assumed that the public offering price will be per Common Share, which is equal to the last reported sale price of the Common Shares on the OTCQB Market on , 2022, after giving effect to a proposed reverse share split of the authorized and outstanding common shares of 1-for-____ to occur immediately following the effective date but prior to the closing of the offering of the Common Shares (the "Reverse Share Split"). The actual public offering price per share will be determined between us and the underwriter at the time of pricing and may be at a discount to the current market price. Therefore, the assumed public offering price used throughout this prospectus may not be indicative of the final offering price. We have applied to list our Common Shares on the Nasdaq Capital Market under the symbols "TO". There can be no assurance that we will be successful in listing our Common Shares on the Nasdaq Capital Market. We will not consummate this offering unless our Common Shares will be listed on the Nasdaq Capital Market. The share and per share information in this prospectus reflects, other than in our consolidated financial statements and the notes thereto, the Reverse Share Split. Investing in our securities involves a high degree of risk, including the risk of losing your entire investment. See "Risk Factors" beginning on page 8 to read about factors you should consider before buying our securities. Per Common Share(3) Total Public Offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds, before expenses, to us(2) $ $ (1) We have also agreed to issue warrants to purchase Common Shares to the representative of the underwriters and to reimburse the representative of the underwriters for certain expenses. See "Underwriting" for additional information regarding total underwriter compensation. Does not include a non-accountable expense allowance equal to 1.0% of the public offering payable to Maxim Group LLC. We do not know whether an active, liquid and orderly trading market will develop for our common shares or what the market price of our common shares will be and as a result it may be difficult for you to sell your common shares. We expect that our stock price will fluctuate significantly, and you may not be able to resell your shares at or above the initial public offering price. We may require additional capital to fund our business and support our growth, and our inability to generate and obtain such capital on acceptable terms, or at all, could harm our business, operating results, financial condition and prospects. The proposed Reverse Share Split may decrease the liquidity of our Common Shares. Following the Reverse Share Split, the resulting market price of our Common Shares may not attract new investors, including institutional investors, and may not satisfy the investing requirements of those investors. Consequently, the trading liquidity of our Common Shares may not improve. Because we can issue additional common shares or preferred shares, our shareholders may experience dilution in the future. Volatility in our common share price may subject us to securities litigation. A prolonged and substantial decline in the price of our common shares could affect our ability to raise further working capital, thereby adversely impacting our ability to continue operations. Because we do not intend to pay any cash dividends on our common shares in the near future, our shareholders will not be able to receive a return on their shares unless they sell them. Because we are a foreign private issuer and are exempt from certain Nasdaq corporate governance standards applicable to U.S. issuers, you will have less protection than you would have if we were a domestic issuer. As a foreign private issuer, we are not subject to U.S. proxy rules and are exempt from filing certain reports under the Securities Exchange Act of 1934. If we were a "passive foreign investment company" for U.S. federal income tax purposes for any taxable year, U.S. Holders of Common Shares could be subject to adverse U.S. federal income tax consequences. Although as a Foreign Private Issuer we are exempt from certain corporate governance standards applicable to US issuers, if we cannot satisfy, or continue to satisfy, the initial listing requirements and other rules of the Nasdaq Capital Market, our securities may not be listed or may be delisted, which could negatively impact the price of our securities and your ability to sell them. If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired. We will incur significant increased costs as a result of operating as a public company in the United States, and our management will be required to devote substantial time to new compliance initiatives. Our executive officers and directors, and their affiliated entities, along with our two other largest stockholders, own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval. New investors in our securities will experience immediate and substantial dilution after this offering. If a substantial number of shares become available for sale and are sold in a short period of time, the market price of our common shares could decline. We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses. We have broad discretion in the use of the net proceeds from this offering and may not use them effectively. If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline. It may be difficult for non-Canadian investors to obtain and enforce judgments against us because of our Canadian incorporation and presence. We are an "emerging growth company," and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our common shares less attractive to investors. The Company enters into 10-year non-cancelable contracts with its customers which agreement contain inflation escalators provisions to mitigate global inflationary pressures. In particular, the tower contracts provide for increases in tower rent with inflation to mitigate the increase in costs. The adjustments are made on an annual basis using the consumer price index in Mexico and Colombia. The Company does not currently intend to take any additional actions to mitigate inflation; however, the Company's business depends on the demand for wireless communication services and wireless infrastructure, and it may be adversely affected by any slowdown in such demand. Additionally, a reduction in carrier network investment may materially and adversely affect the Company's business (including reducing demand for new tenant additions or network services). New technologies may reduce demand for wireless infrastructure or negatively impact revenues. The expansion or development of the Company's business, including through acquisitions, increased product offerings or other strategic growth opportunities, may cause disruptions in the Company's business, which may have an adverse effect on the Company's operations or financial results. (2) The amount of offering proceeds to us presented in this table does not give effect to any exercise of the: (i) over-allotment option we have granted to the representative of the underwriters as described below and (ii) warrants being issued to the representative of the underwriters in this offering. Neither the Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. We have granted a 45-day option to the representative of the underwriters, exercisable one or more times in whole or in part, to purchase up to an additional Common Shares at a price from us at the public offering price per share of Common Shares, less the underwriting discounts payable by us, solely to cover over-allotments, if any. The underwriters expect to deliver the securities against payment on or about , 2022. Sole Book-Running Manager Maxim Group LLC The date of this prospectus is , 2022. The business of the Company has an operating history of approximately 6.5 years. A substantial portion of our revenue is derived from our relationship with one tenant. The Company is reliant on its management and key personnel. The Company is subject to a going-concern risk. Global and national health concerns, including the outbreak of pandemic or contagious diseases, such as the recent COVID-19 (coronavirus), may adversely affect the business and operations of the Company. The Company conducts business in countries with a history of corruption and transactions with foreign governments and doing so increases the risks associated with our international activities. Political, economic and other uncertainties in countries where the Company operates could negatively affect the company's business. Economic and legal conditions in Ecuador remain uncertain which may affect our financial condition, results of operations and cash flows. Ecuador's economy may contract in the future due to international and domestic conditions which may adversely affect our operations. Deterioration in economic and market conditions in Latin America, Ecuador and other emerging market countries could affect the prices of our Common Shares. Security and guerrilla activity in Colombia could negatively impact the Company's business. Social disruptions and instability in Colombia could disrupt the Company's operations. Political risk, social disruptions and instability in Mexico could negatively impact the Company's business. The application of anti-bribery or corruption laws could impact the Company's operations. If the Company fails to comply with laws or regulations which regulate its business and which may change at any time, the Company may be fined or even lose its right to conduct some of its business. Changes in current or future laws or regulations could restrict its ability to operate its business as it currently does. Changes to the tax laws in Colombia, Mexico or Ecuador could negatively impact the Company's business and operations. If radio frequency emissions from wireless handsets or equipment on wireless infrastructure are demonstrated to cause negative health effects, potential future claims could adversely affect the Company's operations, costs or revenues. If the Company is unable to protect its rights to the land under its towers, its business and operating results would be adversely affected. The Company could have liability under environmental and occupational safety and health laws. The Company's towers, data centers or computer systems may be affected by natural disasters and other unforeseen events for which the Company's insurance may not provide adequate coverage. The Company's operations are primarily in jurisdictions outside of Canada or the United States and consequently the Company is subject to the risks of foreign operations generally. Implication of Being an Emerging Growth Company As a company with less than US$1.07 billion in revenue for our last fiscal year, we qualify as an "emerging growth company" pursuant to the Jumpstart Our Business Startups Act of 2012, as amended, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements compared to those that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002 in the assessment of the emerging growth company's internal control over financial reporting. We will remain an emerging growth company until the earliest of (a) the last day of the fiscal year during which we have total annual gross revenues of at least US$1.07 billion; (b) the last day of our fiscal year following the fifth anniversary of the completion of this offering; (c) the date on which we have, during the preceding three-year period, issued more than US$1.0 billion in non-convertible debt; or (d) the date on which we are deemed to be a "large accelerated filer" under the Securities Exchange Act of 1934, as amended, or the Exchange Act, which would occur if the market value of our common shares that are held by non-affiliates exceeds US$700 million. Once we cease to be an emerging growth company, we will not be entitled to the exemptions provided in the JOBS Act discussed above. Foreign Private Issuer Status We are a foreign private issuer within the meaning of the rules under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As such, we are exempt from certain provisions applicable to United States domestic public companies. For example: we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; for interim reporting, we are permitted to comply solely with our home country requirements, which may be less rigorous than the rules that apply to domestic public companies in certain aspects; we are not required to provide the same level of disclosure on certain issues, such as executive compensation; we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; and we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction. Corporate Information We are a corporation incorporated under the Business Corporations Act (British Columbia) in British Columbia, Canada under the name "Tower One Wireless Corp." with an authorized share structure of an unlimited number of Common Shares and Class B Preferred Shares without par value, including 1,500,000 Class B Series I Preferred and 1,000,000 Class B Series II Preferred. Our head office is Calle 84 A No.12 - 18 Oficina 302, Bogot DC, Colombia; our head office telephone number is +57 1382 7957; and our registered and records office is Suite 900 - 885 West Georgia Street, Vancouver, British Columbia V6C 3H1, Canada. Our registered agent in the United States is GKL Corporate/Search, Inc., located at One Capitol Mall, Suite 660, Sacramento, California 95814 and its telephone number is (910) 442-7652.
\ No newline at end of file
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@@ -0,0 +1,1125 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+The
+following summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information
+that may be important to you. You should read this entire prospectus carefully, including the sections entitled "Risk Factors"
+and "Management s Discussion and Analysis of Financial Condition and Results of Operations" and our historical financial
+statements and related notes included elsewhere in this prospectus. In this prospectus, unless otherwise noted, the terms "the
+Company," "we," "us," and "our" refer to Agro Capital Management Corp.
+
+ 
+
+The
+Company
+
+ 
+
+Background
+
+ 
+
+We
+were incorporated in Nevada on November 12, 2013 under the name Guate Tourism Inc. Until September 11, 2015, we operated an online tourist
+guide company in Guatemala.
+
+ 
+
+On
+October 29, 2015, Guate Tourism Inc. conducted a statutory merger with its wholly-owned subsidiary, Agro Capital Management Corp. The
+subsidiary was not an operating company and held no assets. Guate Tourism Inc., as the surviving entity, changed its name in connection
+with the merger to Agro Capital Management Corp. On December 11, 2015, FINRA announced the name change and symbol change to "ACMB".
+
+ 
+
+On
+April 7, 2020, the District Court of Clark County issued an Order Granting Application for the Appointment of Barbara Bauman as Custodian
+of the Company ("Court Order") since no management team was in place to manage the affairs of the Company and protect the
+financial interest of its shareholders. Under the terms of the Court Order, all prior officers and directors of the Company were removed,
+and Ms. Bauman was required to file quarterly reports with the Court regarding the actions she was taking to protect the existing shareholders
+of the Company. Ms. Bauman was a shareholder of the Company prior to her appointment. On April 8, 2020, the Company was reinstated and
+brought back to good standing with the State of Nevada, as required by the Court Order, by its sole officer and director, Barbara Bauman.
+
+ 
+
+On
+October 12, 2020, Barbara Bauman submitted to the District Court of Clark County a motion to terminate custodianship on the basis of
+having completed the requested actions of the District Court on behalf of the Company.
+
+ 
+
+On
+October 31, 2020, Barbara Bauman effected a change of control of the Company by selling 50,000,000 shares of the Company s common
+stock that she owned and 2,000 shares of the Company s Series A Preferred Stock that she owned to Apex Holdings, Inc.
+
+ 
+
+On
+November 3, 2020, Ms. Bauman resigned from her position as the sole officer and director of the Company and appointed the current members
+of the Company s Board of Directors (the "Board"), Scott Benson and Ted Hicks, and the current executives, Scott Benson
+as Chief Executive Officer, Ted Hicks as President, Geoffrey Lawrence as Chief Financial Officer then replaced by James Pekarsky on April
+2, 2021 and Gordon Ellis as Chief Operating Officer.
+
+ 
+
+ 1
+
+ 
+
+ 
+
+ 
+
+On
+December 2, 2020, the Board and a majority of our shareholders, approved a 1-for-25 reverse stock split of the issued and outstanding
+shares of common stock of the Company, reducing the issued and outstanding shares of common stock from 69,912,152 to 2,796,486 post reverse
+split shares.
+
+ 
+
+On
+December 29, 2020, we entered into a merger agreement with Apex Holdings, Inc. ("Apex"), a privately held Nevada-based holding
+company, with assets engaged in the business of manufacturing and distributing licensed cannabis in the State of CA. Following the merger,
+the shareholders of Apex hold 97.9% of our issued and outstanding shares. Our officers and directors are the same as the officers and
+directors of Apex. Apex became a subsidiary of ours following the merger.
+
+ 
+
+Overview
+
+ 
+
+Apex is a California licensed
+manufacturer and distributor of adult-use and medicinal cannabis products. Apex was incorporated in Nevada in February 2017 and began
+to manufacture and distribute cannabis products in January 2018. Following our acquisition of Apex in December 2020, we obtained its
+branded cannabis oil products and vape cartridge delivery systems, including intellectual properties, research and development, web sites,
+packaging designs, related marketing materials and trade secrets surrounding extraction of cannabis, manufacturing vape cartridge components,
+filters, cannabis oil formulae and vape cartridge designs.\. We manufacture through proprietary methods to produce high quality and award-winning
+oils and other cannabis products for ourselves as well as on a white label basis for other retailers of legal cannabis products. Our
+process requires that we have a Type 7 volatile manufacturing license for extraction using our approach. We have had our Type 7 license
+since January 2018. In the first quarter of 2020, Apex introduced new proprietary oils marketed as "Pure Spectrum Extract"
+that have repeatedly sold out by our retail customers.
+
+ 
+
+Apex
+products have received a number of awards:
+
+ 
+
+ 
+ 
+ 
+ 1st
+ Place / Weedcon Harvest Festival / November 2021 / Best Extract : Indica
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1st
+ Place / Weedcon Wonderland / May 2021 / Live Resin Hybrid
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1st
+ Place / Hempcon San Francisco / September 2019 / Best Sativa Concentrate
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1st
+ Place / Hightimes Central Valley / March 2019 / Indica Concentrate
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1st
+ Place / Hightimes Central Valley / March 2019 / Hybrid Concentrate
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1st
+ Place / Hightimes Norcal / May 2019 / Sativa Concentrate 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1st
+ Place / Hightimes Bay Area / June 2019 / Hybrid Concentrate
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2nd
+ Place / Hightimes Norcal / May 2019 / Sativa Concentrate
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3rd
+ Place / Hightimes Bay Area / June 2019 / Vape Pen & Cartridge
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3rd
+ Place / Hightimes SoCal / July 2019 / Sativa Concentrate
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3rd
+ Place / Hightimes SoCal / July 2019 / Hybrid Concentrate
+
+ 
+ 
+
+Awards
+from Hightimes can be found at https://hightimes.com/, Weedcon https://weedconproductions.com/weedcon-cup, and Hempcon https://www.cannabiscupwinners.com/cups-and-awards/hempcon-cup.html.
+We did not enter into any award programs during 2020 due to covid restrictions.
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+We
+manufacture through proprietary methods to produce high quality and award-winning oils and other cannabis products for ourselves as well
+as on a white label basis for other retailers of legal cannabis products. We only operate in those states where cannabis is legalized
+and regulated under applicable state laws, and/or has been decriminalized for medical use and/or legalized for recreational use. Our
+California manufacturing facility is located in Oakland, California and currently produces resin and rosin concentrates, infused pre-rolls
+and packaged flower. The Oakland facility can process 450 pounds of material per week. We purchased equipment that we expect to be operational
+in February 2022 and when functioning will increase our manufacturing capacity to 1,950 pounds per week which equates to approximately
+500,000 grams of concentrates per month. The additional concentrate capacity will be used to expand availability of the Apex line, increase
+bulk sales and infuse flower and pre-rolls. Market demand will determine the ultimate mix of products. We can add shifts to increase
+capacity further if demand warrants the expansion.
+
+ 
+
+Our
+California cannabis distribution license allows us to transport raw material to our processing facility. Our material buyers locate material
+that meets our quality standards and then arrange for transport with our licensed team. This raw material becomes the basis for the concentrates
+that we create. Our distribution license also allows us to distribute finished product to retail outlets. We service the retail outlets
+with an internal direct sales team that supports locations throughout California.
+
+ 
+
+Our
+product line expansions will be limited to products that incorporate full spectrum oil which we believe to be a competitive advantage
+of our manufacturing process. Our process does not use a distillate additive to prevent the THC from crystallizing which leaves our oil
+with what we believe to be the best consumption experience.
+
+ 
+
+In December 2021 we began operating
+in Oklahoma with a transport and processing license that we obtained through the purchase on November 22, 2021 of all assets of Primo
+Laboratories LLC, located in Oklahoma City, Oklahoma, that is licensed by the Oklahoma Medical Marijuana Authority (OMMA) to manufacture
+and distribute a variety of cannabis products for medical use only. Under Oklahoma law, sales of cannabis are limited to the medical
+market and purchasers of cannabis must obtain a medical marijuana license from the OMMA. With the transport license product can be transported
+from the grower to our facility for processing. The existing processing license is for non-volatile manufacturing so instead of the butane-based
+extraction used in our Oakland facility we are using ice-based extraction to produce hash concentrates. Concentrates are being sold under
+the Apex brand name using the same color coding (ivory, emerald and black) as used in California. The color coding correlates to the
+quality and price point of the product. Ivory Label is our lowest tiered product with the lowest quality of our line and the lowest
+price point. Emerald is our mid-tier product with a mid-tier price point. Black label is our top-of-the-line product with the highest
+price point and lowest volume of production. The facility can generate approximately 8,000 grams of product/month as configured. The
+Oklahoma facility will also support packaged flower, packaged infused flower, and infused pre-rolls. The Oklahoma product produced will
+be sold by our internal team to support distribution throughout Oklahoma.
+
+ 
+
+Our product line expansions will
+be limited to products that incorporate full spectrum oil which we believe to be a competitive advantage of our manufacturing process.
+Our process does not use a distillate additive to prevent the THC from crystallizing which leaves our oil with what we believe to be
+the best consumption experience. We currently provide a line of concentrates which are resins sold in 1 gram jars. We have offered this
+product since the start of our operations. Initially we sold only one grade of product which is our Ivory label product but have
+since that time expanded to include an Ivory, Emerald and Black label product. All of these products use the same process
+of production but qualitatively are different based upon the quality of the input material. Superior indoor grown raw material is required
+for our higher tier products which typically cost more to procure. Our collective team then analyses the results and rates based on smell,
+taste and color to determine which color label best defines the quality of the product produced. We also product Pure Spectrum Extract
+that takes an extra step in the production cycle. The concentrates we produce result in a combination of liquid terpenes and crystalized
+THC. In our Pure Spectrum Extraction, we combine the THC crystals and terpenes to create an oil in which the THC does not recrystallize.
+This process makes the oil available for use in carts and pens that we sell wholesale to pen and cart providers. We also use a combination
+of this Pure Spectrum extract and THC crystals to infuse flower with more flavor (from the terpense) and more THC (from the crystals)
+to create infused pre-rolls and infused flower that are sold under the Apex name. This product was first introduced in the last week
+of December in 2021 with a plan to increase production over the course of the year based on demand. The combination of all of these products
+will be sold in the recreational market in California. Our retailers may choose to market some of these products using their medical
+license for the sale, but our process flow will not change in either case regardless of the final market to which the product
+is sold. In Oklahoma, all product offered is sold as medical product by the retailers. The Oklahoma product line at this time includes
+concentrates of each grade (Ivory, Emerald and Black) and flower. Infused flower and infused pre-rolls will be introduced
+later this year.
+
+ 
+
+We plan to replicate our full
+product portfolio in each state chosen for expansion. Concentrates and infused pre-rolls will serve as the lead products for introduction
+to each market. Our concentrate line will continue to use the ivory/emerald/black color coding for product quality to help the end consumer
+choose the product that is the best match for their taste. Concentrate production will follow the standard operating procedures first
+developed for the California market. The concentrates will serve as the additive for infused 1/2 gram and full gram pre-roll. When evaluating
+new geographic expansion opportunities, we will evaluate the raw material price points and availability, the quality of competitive products
+in the market and wholesale price points. When markets offer an opportunity for gross margins at or above 50%, we will then evaluate
+the availability and price of licensed production facilities to determine if the market economics support our product portfolio. We do
+not plan to expand into any states that limits the percentage of THC allowed for sale.
+
+ 
+
+Our
+product and geographic expansion plans face many challenges which include:
+
+ 
+
+Market
+Oversupply: New and existing entrants into the market may oversupply product within our targeted categories or price product
+below production cost to establish market share.
+
+ 
+
+Regulatory Risks:
+We face the risk that cannabis continues to be categorized as a Schedule I controlled substance under the U.S. Controlled Substance Act
+of 1970 (codified in 21 U.S.C.A. Section 812) (the "Controlled Substances Act"). Under federal law, a Schedule I drug is
+considered to have a high potential for abuse, no accepted medical use in the United States, and a lack of accepted safety for the use
+of the substance under medical supervision. Federal law prohibits commercial production and sale of all Schedule I controlled substances,
+and as such, cannabis-related activities, including without limitation, the importation, cultivation, manufacture, distribution, sale
+and possession of cannabis remain illegal under federal law. It is also illegal to aid or abet such activities or to conspire or attempt
+to engage in such activities. Strict compliance with state and local laws with respect to cannabis may neither absolve us of liability
+under U.S. federal law, nor provide a defense to any federal proceeding brought against us. An investor s contribution to and involvement
+in such activities may result in federal civil and/or criminal prosecution, including, but not limited to, forfeiture of his, her or
+its entire investment, fines and/or imprisonment. In addition, local tax rates and compliance requirements may change and increase our
+operating costs.
+
+ 
+
+Lack of Profitability:
+We are not profitable and have had to raise capital through sale of our common stock to continue our operations. Our auditor
+has issued going concern opinions in connection with their audit of our year end financial statement for 2020 and 2021 as a result of
+our recurring losses and negative cash flows from operations.
+
+ 
+
+Personnel
+Availability: Hiring in the current post covid environment is more challenging and may present us with difficulties to fill needed
+positions in manufacturing.
+
+ 
+
+Inflation:
+Escalating inflation rates may have an adverse effect on our business impacting our hiring and provisioning costs in ways that
+we have not experienced or predicted
+
+ 
+
+Economic Slowdown:
+The economy could experience a significant slowdown or recession that could reduce retail sales.
+
+ 
+
+Federal Legalization:
+Federal legalization may increase competition from locations outside of our primary markets and drive margins lower.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+Supply Chain issues: Current
+and on-going supply chain issues may impact our ability to secure packaging materials, manufacturing equipment, and other critical supplies
+required to produce product for our markets.
+
+ 
+
+Insurance availability: Insurance
+for some aspects of the business and some locations may not be available at the levels normally associated with a business operations.
+
+ 
+
+Recent
+Reverse Split
+
+ 
+
+On January 22, 2021 FINRA announced
+a 1-for-5 reverse split for the Company that took effect on January 25, 2021.
+
+ 
+
+Corporate
+Strategy
+
+ 
+
+Our
+strategy is to operate and expand our holdings in the legal cannabis industry through acquisition, joint venture, partnership or investment
+to increase our market presence in California and additional states through direct acquisitions and licensing arrangements.
+
+ 
+
+The
+key elements of our growth strategy are:
+
+ 
+ 
+
+Increase
+ the Variety of Our Products. We plan to expand the variety and breadth of products
+ supporting additional brands, and new hardware suppliers for vape products that promise to
+ offer highly customized vaping experience. The customized experience dramatically improves
+ the customer experience in ways that are unique to the product category. For our Live Resin
+ brand we recently introduced a mid-tier product (Emerald) between our premium quality black
+ label line and our base white/ivory label line. We also plan to incorporate a full spectrum
+ oil into a variety of edible products once our R&D effort is complete. We have
+ also recently added an infused pre-roll line to our product portfolio.
+
+ 
+ 
+
+Enter
+into More Strategic Partnership Arrangements. We intend to expand our operations over time to other states that have legalized
+cannabis consumption. Our current targets include Arizona, Georgia, Hawaii, Nevada, New York, Illinois, Michigan, Oklahoma and Washington.
+We have identified potential partners in each state that are either in possession of a license and facility or are in the process of
+securing. Ideal partners will have additional cannabis assets in the proposed expansion area to include distribution, cultivation, and
+retail. In addition to geographic expansion we are involved in R&D projects that will significantly reduce the cost of our product
+while improving the consistency of the flavor profiles within our product lines. The tech that we are reviewing will also allow us to
+create new flavor profiles to meet changing consumer preferences. We are also in the process of developing retail delivery relationships
+that will allow us to restart our fresh monthly subscription service designed to support the most sophisticated consumers that generate
+the most consistent monthly sales.
+
+ 
+
+Develop
+Additional Revenue Streams: As we expand into more markets we will continue to identify product opportunities that allow us to
+leverage or experience in creating fine oils. We believe consumer tastes will continue to become more sophisticated as we have seen in
+California. As the market moves from cheap distillate to full spectrum product, we will be there with products that deliver oils using
+the most desired delivery methodologies available at the time. Our R&D team will continue to develop and test new products to keep
+us at the front of the changing cannabis marketplace.
+
+ 
+
+Further
+Develop Our Technology. We plan to devote significant resources to enhance the extraction of high quality concentrates. Our process
+utilizes equipment that is available from a variety of extraction equipment providers combined in a way that produces consistent high
+quality products utilizing proprietary operating procedures developed by our team of engineers. In addition, reducing our manufacturing
+costs down while improving quality has been a driving force behind our growth since the inception of the Company. Every step of our process
+is measured and reported upon to continually improve the flow. We believe the financial markets will continue to reward those that focus
+on traditional business metrics while the consumer market will reward those companies that provide a premium experience at a reasonable
+price point.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+Strengthen
+the Apex Brand: We are working on developing a national brand of cannabis concentrates, which will be sold wholesale to dispensaries,
+through standardization of the production, material acquisition, storing, testing, compliance and labeling process. The process begins
+with a proprietary method of evaluating product quality and our work with cultivation partners to ensure the critical process of cultivation
+and storage used supports the Apex manufacturing standards. We then use our proprietary methods to extract the maximum flavor profile
+and present the product in the most visually pleasing way possible. 
+
+ 
+
+Securing
+capital for the construction of processing centers. ACMB management and capital partners have a proven track record for securing
+needed capital to drive growth. This prospectus is the first step to securing the funding required to maximize the organic growth available
+to us in the California market while working with our strategic partners and acquisition targets to expand into other geographic locations.
+
+ 
+
+Obtaining
+the necessary state and local licensure for each proposed facility. The Apex team responsible for securing one of the first manufacturing
+and distribution licenses in California remains with the company and will continue to drive the process for capturing other licenses.
+Our team has also worked with prospective partners to help with their applications with the intent of leveraging awarded licenses with
+Apex technology, branding, and process flow.
+
+ 
+
+Constructing
+processing facilities. Apex starts with industry standard equipment that is then customized to maximize the productivity, throughput,
+and quality of the manufacturing line. The engineering team responsible for the design will replicate our facility and standard operating
+procedures in other geographies.
+
+ 
+
+Expanding
+per-facility capacity and increasing revenues. The Apex production design team has a proven method for expanding the capacity
+and therefore the revenue streams typically available from industry standard equipment. Our customization and process flows combine to
+offer our team some of the lowest product costs which we then pass on to our customers while maintaining a premium consumption experience.
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+Implications
+of Being an Emerging Growth Company
+
+ 
+
+As
+a company with less than $1.0 billion in revenue during our most recently completed fiscal year, we qualify as an "emerging growth
+company" as defined in Section 2(a) of the Securities Act of 1933, as amended, which we refer to as the Securities Act, as modified
+by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, we may take advantage of specified
+reduced disclosure and other requirements that are otherwise applicable, in general, to public companies that are not emerging growth
+companies. These provisions include:
+
+ 
+
+ 
+ 
+ 
+ Reduced
+ disclosure about our executive compensation arrangements;
+
+ 
+ 
+ No
+ non-binding shareholder advisory votes on executive compensation or golden parachute arrangements;
+
+ 
+ 
+ Exemption
+ from the auditor attestation requirement in the assessment of our internal control over financial reporting; and
+
+ 
+ 
+ Reduced
+ disclosure of financial information in this prospectus, limited to two years of audited financial information and two years of selected
+ financial information.
+
+ 
+ 
+
+As
+a smaller reporting company, each of the foregoing exemptions is currently available to us. We may take advantage of these exemptions
+for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company
+if we have more than $1.0 billion in annual revenues as of the end of a fiscal year, if we are deemed to be a large-accelerated filer
+under the rules of the Securities and Exchange Commission, or if we issue more than $1.0 billion of non- convertible debt over a three-year-period.
+
+ 
+
+The
+JOBS Act permits an emerging growth company to take advantage of an extended transition period to comply with new or revised accounting
+standards applicable to public companies. We have elected the extended transition period for complying with new or revised accounting
+standards pursuant to Section 107(b) of the Act until the earlier of the date we (i) are no longer an emerging growth company or (ii)
+affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements
+may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were incorporated in the State of Nevada on November 12, 2013. Our executive office is located at 2620 Regatta Drive, Suite 102, Las
+Vegas, Nevada 89128, and our telephone number is (702) 560-2430. Our internet website is www.acmbinc.com, The information on,
+or that can be accessed through, our website is not part of this prospectus, and you should not rely on any such information in making
+the decision whether to purchase our common stock.
+
+ 
+
+The
+Offering
+
+ 
+
+ 
+ Common
+ Stock to be Sold
+ Up
+ to 30,104,523 shares of our common stock including 20,104,523 representing 20% of the shares of our common stock that each of our
+ stockholders owns and 10,000,000 shares of our common stock underlying warrants that we issued to 18 investors who purchased shares
+ of our common stock in connection with a financing in which we raised $3,000,000.
+
+ 
+ 
+ 
+
+ 
+ Common
+ Stock Outstanding before
+
+ the
+ Offering
+
+ 
+
+ Common
+ Stock Outstanding after
+
+ the
+ Offering
+
+ 51,598,821
+ as of March14, 2022(1)
+
+ 
+
+ 
+
+ 
+
+ 61,598,821
+
+ 
+ 
+ 
+
+ 
+ Use
+ of Proceeds
+ This
+ is a resale prospectus to register shares of the Selling Stockholders but we may receive
+ up to approximately $6,000,000 in gross proceeds upon the cash exercise of certain warrants
+ by the Selling Stockholders.
+
+ 
+
+ We
+ intend to use the net proceeds from the exercise of warrants for (i) potential joint ventures, (ii) potential mergers and acquisitions,
+ (iii) general working capital. The expected uses of the net proceeds from the exercise of the warrants represent our intentions based
+ upon our current plans and business conditions. The precise uses, amounts and timing of the application of proceeds have yet to be
+ determined by our management and may differ, in some or all respects, from those enumerated above. The merger and acquisition targets
+ will be focused on opportunities in states that have legalized cannabis and for opportunities specific to the manufacturing process.
+ We will seek opportunities that involve a partner that can provide access to raw materials and retail as well as opportunities that
+ involve the potential for bulk processing contracts. The amounts used for each purpose and timing of our actual expenditures may
+ also vary significantly depending on numerous factors. See "Use of Proceeds." We will not receive any of the proceeds
+ from the sale or other disposition of the securities by the Selling Stockholders. We have agreed to bear the expenses relating to
+ the registration of the shares of our common stock held by the Selling Stockholders. See "Use of Proceeds".
+
+ 
+
+ 
+ 
+ 
+
+ 
+ Dividend
+ Policy
+ We
+ have never declared any cash dividends on our common stock. We currently intend to retain all available funds and any future earnings
+ for use in financing the growth of our business and do not anticipate paying any cash dividends for the foreseeable future. See "Dividend
+ Policy".
+
+ 
+ 
+ 
+
+ 
+ OTC:
+ Pink Symbol
+ ACMB
+
+ 
+ 
+ 
+
+ 
+ Risk
+ Factors
+
+ 
+
+ 
+
+ You
+ should carefully consider the information set forth in this prospectus and, in particular,
+ the specific factors set forth in the "Risk Factors" section beginning on page
+ 10 of this prospectus before deciding whether or not to invest in our common stock.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ (1)
+ Does
+ not include 10,000,000 shares issuable upon exercise of outstanding warrants or upon exercise of 705,000 options as of February 14,
+ 2022.
+
+ 
+ 
+
+ 7
+
+ 
+
+ 
+
+ 
+
+Summary
+Financial Information
+
+ 
+
+The
+summary financial information set forth below is derived from the more detailed audited consolidated financial statements of the Company
+appearing elsewhere in this prospectus. You should read the summary consolidated financial information below in conjunction with "Management s
+Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements, including the notes to
+such financial statements.
+
+ 
+
+ 
+ Statement of Operations Data:
+ 
+ Nine Months Ended
+ 
+ 
+ Nine Months Ended
+ 
+ 
+ Year Ended
+ 
+
+ 
+ 
+ 
+ September
+ 30,
+
+ 2021
+
+ 
+ 
+ September
+ 30,
+
+ 2020
+
+ 
+ 
+ December 31, 2020
+ 
+ 
+ December 31, 2019
+ 
+
+ 
+ 
+ 
+ (reviewed)
+ 
+ 
+ (audited)
+ 
+ 
+ (audited)
+ 
+ 
+ (audited)
+ 
+
+ 
+ Revenues, net
+ 
+ $
+ 5,284,224
+ 
+ 
+ $
+ 4,418,366
+ 
+ 
+ $
+ 4,752,454
+ 
+ 
+ $
+ 5,319,158
+ 
+
+ 
+ Cost of Goods Sold
+ 
+ 
+ 1,828,867
+ 
+ 
+ 
+ 1,911,648
+ 
+ 
+ 
+ 1,064,576
+ 
+ 
+ 
+ 4,968,822
+ 
+
+ 
+ Gross Profit
+ 
+ 
+ 3,455,357
+ 
+ 
+ 
+ 2,506,718
+ 
+ 
+ 
+ 3,687,878
+ 
+ 
+ 
+ 350,336
+ 
+
+ 
+ Total Operating Expenses
+ 
+ 
+ 3,880,737
+ 
+ 
+ 
+ 2,525,636
+ 
+ 
+ 
+ 7,577,816
+ 
+ 
+ 
+ 4,301,425
+ 
+
+ 
+ Net Profit (Loss) from Operations
+ 
+ 
+ (385,380)
+ 
+ 
+ 
+ (18,918)
+ 
+ 
+ 
+ ss(3,889,938
+ )
+ 
+ 
+ (3,951,089
+ )
+
+ 
+ Other Income (Expense)
+ 
+ 
+ 167,938
+ 
+ 
+ 
+ (3,131,366
+ )
+ 
+ 
+ 1,268,349
+ 
+ 
+ 
+ (142,659
+ )
+
+ 
+ Net (Loss) Income
+ 
+ $
+ (221,595)
+ 
+ 
+ $
+ (3,150,284)
+ 
+ 
+ $
+ (2,621,589
+ )
+ 
+ $
+ (4,093,748
+ )
+
+ 
+ Basic and Diluted
+ 
+ 
+ 51,068,249
+ 
+ 
+ 
+ 2,934,205
+ 
+ 
+ 
+ 32,512,667
+ 
+ 
+ 
+ 30,073,968
+ 
+
+ 
+ Net Gain (Loss) Per Share
+ 
+ $
+ (.004)
+ 
+ 
+ $
+ (1.07
+ )
+ 
+ $
+ (.08
+ )
+ 
+ $
+ (0.14
+ )
+
+ 
+ Weighted Average Number of Shares Outstanding Basic and Diluted
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+ Balance Sheet Data: 
+ September 30, 2021 
+ December 31, 2020 
+ December 31, 2019 
+
+ 
+ 
+ (reviewed) 
+ (audited) 
+ (audited) 
+
+ 
+ Cash 
+ $1,564,203 
+ $25,236 
+ $51,512 
+
+ 
+ Receivables, net 
+ 472.748 
+ 281,062 
+ 172,180 
+
+ 
+ Inventory 
+ 2,150,878 
+ 95,482 
+ 218,770 
+
+ 
+ Prepaid expenses and other assets 
+ 164,054 
+ 105,347 
+ 45,789 
+
+ 
+ Property, plant and equipment, net 
+ 738,803 
+ 806,059 
+ 917,136 
+
+ 
+ Total Assets 
+ $5,090,686 
+ $1,313,186 
+ $1,405,387 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Accounts Payable 
+ $2,013,687 
+ $1,595,775 
+ $587,721 
+
+ 
+ Accrued and Other Liabilities 
+ 3,291,554 
+ 2,330,172 
+ 769,517 
+
+ 
+ Long-term debt 
+ 142,915 
+ 392,808 
+ 1,747,624 
+
+ 
+ Due to related parties 
+ 153,010 
+ 283,316 
+ - 
+
+ 
+ Total Liabilities 
+ 5,601,166 
+ 4,602,071 
+ 3,104,862 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Common stock, $0.001 par value; 200,000,000 shares authorized; 934,205, 2,934,205, and10,796,485 shares issued and outstanding
+ as of December 31, 2019, 2020 and September 30, 2021 
+ 10,796 
+ 2,934 
+ 934 
+
+ 
+ Preferred stock, $0.001 par value, 2000 shares authorized; 2,000 shares issued and outstanding as of December 31, 2020 and September
+ 30, 2021 
+ 2 
+ 2 
+ - 
+
+ 
+ Additional Paid-in Capital 
+ 7,442,757 
+ 9,464,765 
+ 8,434,588 
+
+ 
+ Accumulated Deficiency 
+ (7,964,035) 
+ (12,756,586) 
+ (10,134,997)
+
+ 
+ Total Stockholder s Equity (Deficiency) 
+ (510,480) 
+ (3,288,885) 
+ (1,699,475)
+
+ 
+ Total Liabilities and Stockholders Equity 
+ $5,090,686 
+ $1,313,186 
+ $1,405,387 
+
+ 
+
+ 
+
+ 8
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001604930_life_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001604930_life_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..0095229edbe689d230b6fb20b2ecaa7d2901fd61
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001604930_life_prospectus_summary.txt
@@ -0,0 +1,699 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights information contained elsewhere in this prospectus or incorporated by reference. It may not contain all of the information
+that you should consider before investing in our securities. You should read this entire prospectus carefully, including the Risk
+Factors , Management s Discussion and Analysis of Financial Condition and Results of Operations sections, and
+the financial statements and related notes included herein. This prospectus includes forward-looking statements that involve risks and
+uncertainties. See Cautionary Note Regarding Forward-Looking Statements. 
+
+ 
+
+Company
+Structure and History
+
+ 
+
+Life
+Clips, Inc. ( Life Clips , LCLP , we, us, our, and the Company )
+was incorporated in Wyoming on March 20, 2013 as Blue Sky Media Corporation and its principal business was developing, financing, producing
+and distributing motion pictures and related entertainment products. Following the Company s October 2, 2015 acquisition of Klear
+Kapture, Inc. ( Klear Kapture ), the Company continued Klear Kapture s business of developing a body camera and an
+auditable software solution suitable for use by law enforcement. The Company changed its name to Life Clips, Inc. on November 3, 2015
+in order to better reflect its business operations at the time.
+
+ 
+
+On
+July 11, 2016, the Company completed its acquisition (the Acquisition ) of all of the outstanding equity securities of Batterfly
+Energy Ltd. ( Batterfly ), an Israel-based corporation that develops and distributes a single-use, cordless battery under
+the brand name Mobeego for use with cellular phones and other mobile devices. Batterfly is now a wholly owned subsidiary of the Company.
+The Acquisition was completed pursuant to a Stock Purchase Agreement, dated as of June 10, 2016 (the Purchase Agreement ),
+among the Company, Batterfly and all of the shareholders of Batterfly, as amended.
+
+ 
+
+On
+April 5, 2021, the Company closed its acquisition of Cognitive Apps Software Solutions, Inc. ( Cognitive Apps , Subsidiary ),
+a developer of artificial intelligence ( AI ) applications for the healthcare industry and psychedelic research. Cognitive
+Apps was incorporated in British Columbia on November 25, 2020. Its principal business is developing, financing, producing and distributing
+AI based technological solutions to the mental health and healthcare sector.
+
+ 
+
+Cognitive
+Apps sold all of its issued and outstanding capital stock to LCLP, becoming a wholly-owned subsidiary of LCLP.
+
+ 
+
+On
+August 25, 2021, LCLP closed its acquisition of Belfrics Holdings Limited and its related entities (collectively Belfrics )
+operating cryptocurrency exchanges and blockchain development services in Asia and Africa. The entities acquired are:
+
+ 
+
+Belfrics
+Global PTE Ltd., a Singapore corporation
+
+Belfrics
+BT Pvt Ltd, an India corporation
+
+Belfrics
+Cryptex Pvt Ltd, an India corporation
+
+Belfrics
+Tanzania Ltd, a Tanzania corporation
+
+Belfrics
+Nigeria Pvt Ltd, a Nigeria corporation
+
+Belfrics
+BT SDN BHD, a Malaysia corporation
+
+Belfrics
+Holding Limited, a Malaysia corporation
+
+Belfrics
+Academy SDN BHD, a Malaysia corporation
+
+Belfrics
+International Ltd, a Malaysia corporation
+
+Belfrics
+Europe SL, a Spain corporation
+
+Belfrics
+Kenya Pvt. Ltd, a Kenya corporation
+
+Incrypts
+SDN BHD, a Malaysia corporation
+
+Belfrics
+Malaysia SDN BHD
+
+ 
+
+The
+Company issued the Belfrics shareholders a new class of preferred stock with an initial issuance price of $20,000,000 (Twenty Million
+Dollars) in the aggregate. The Belfrics shareholders can earn up to an additional $15,000,000 (Fifteen Million Dollars) by reaching certain
+milestones.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+Our
+website is https://lifeclips.com/. Information contained on our website does not constitute part of and is not incorporated into this
+prospectus.
+
+ 
+
+Company
+Overview
+
+ 
+
+Cognitive
+Apps provides an AI powered mental health analytics platform empowering businesses to measure, understand, and improve the mental well-being
+of their employees, patients or customers. The Cognitive Apps solution is driven to achieve the Three Pillars: improved diagnostic outcomes,
+better and more personalized care for individuals, and to decrease the overall costs and time for the care. An individual only needs
+to record their voice on a handset, iPad, or tablet. The Cognitive Apps assessment is designed to be administered as often as daily,
+in order to provide a more granular picture of changes in mental health over time. As a result, the Cognitive apps assessment can be
+routinely completed to monitor mental health and track variables that might be impacted by treatment.
+
+ 
+
+Cognitive
+Apps delivers a comprehensive approach to well-being, supporting the whole person. Cognitive apps currently has partnerships with Ehave
+(OTC: EHVVF), Mycotopia (OTC: TWGL), Welmind EMR, Betterhelp, Belshare, and Movefit.
+
+ 
+
+Founded
+in 2015, the Belfrics digital exchange platform, which was fully developed in-house, is one of the most compliant platforms in the cryptocurrency
+industry. Supported by the proprietary technology of Belrium Blockchain KYC solution, the KYC ( Know Your Customer ) and
+AML ( Anti-Money Laundering ) process of Belfrics Exchange is well accepted compliance solution. With 10 operational offices
+in 8 countries, Belfrics provides localized and personalized support to digital currency traders. Through its Blockchain Academy, Belfrics
+provides continuous training to traders, developers and blockchain enthusiasts in more than 20 countries. Belfrics is licensed and regulated
+by the Labuan Financial Services Authority (LFSA) in Malaysia.
+
+ 
+
+In
+addition to the digital assets exchange services, Belfrics Belrium Blockchain is a core solution over which multiple decentralized
+applications (dApp) are built. The Blerium-based KYC solution (BKVS) received a patent from Nigeria Patent Authority and Capital Markets
+Authority of Kenya (CMA) granted a Sandbox license for Belfrics to test the KYC solution for financial institutions. Belfrics has developed
+decentralized applications on Belrium blockchain for health, education and employment sectors.
+
+ 
+
+For
+a more thorough discussion of the Company s business, see Business on page 25.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+The
+Offering
+
+ 
+
+ 
+ Issuer
+ Life
+ Clips Inc.
+
+ 
+ 
+ 
+
+ 
+ Common
+ Stock offered by the selling stockholder
+ Up
+ to $50,000,000 worth of shares of our Common Stock, consisting of:
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 35,460,739
+ shares of our Common Stock initially issued to the selling stockholder as consideration for its commitment to purchase shares of
+ our Common Stock under the Purchase Agreement (the Commitment Shares ),
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ up
+ to approximately 474,539,261 shares of Common Stock that we may sell to the selling stockholder, from time to time at our sole discretion,
+ pursuant to the Purchase Agreement, described below.
+
+ 
+ 
+
+ 
+ Common
+ Stock outstanding prior to this Offering
+ 
+
+ 
+
+1,794,446,647 shares (as of June 3,
+2022)*
+
+ 
+
+ 
+ 
+ 
+
+ 
+ Common
+ Stock outstanding immediately after this Offering
+ 2,304,446,647
+ shares (as of June 3, 2022)*
+
+ 
+ 
+ 
+
+ 
+ Trading
+ symbol
+ Our
+ Common Stock is currently listed on OTC Markets under the symbol LCLP. 
+
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds
+ The
+ selling stockholder will receive all of the proceeds from the sale of the shares offered for sale by it under this prospectus. We
+ will not receive proceeds from the sale of the shares of our Common Stock by the selling stockholder through this prospectus. However,
+ we may receive gross proceeds of up to $50.0 million from the sale of our Common Stock to the selling stockholder under the Purchase
+ Agreement. We will not receive any cash proceeds from the issuance of the Commitment Shares, or any additional Commitment Shares
+ issued pursuant to the Purchase Agreement, to the selling stockholder under the Purchase Agreement. We intend to use any proceeds
+ from the selling stockholder that we receive under the Purchase Agreement for working capital, strategic and general corporate purposes.
+ See Use of Proceeds on page 14 for more information.
+
+ 
+ 
+ 
+
+ 
+ Risk
+ factors
+ Investing
+ in our securities involves a high degree of risk. As an investor you should be prepared to lose your entire investment See Risk
+ Factors beginning on page 7.
+
+ 
+ 
+
+*
+The above discussion excludes:
+
+ 
+
+ 
+ 
+ 
+ A
+ number of shares of Common Stock issuable from the conversion of Series B and Series C preferred
+
+ 
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+SUMMARY
+CONSOLIDATED FINANCIAL INFORMATION
+
+ 
+
+The following tables present our summary consolidated
+financial and other data as of and for the periods indicated. The summary consolidated statements of operations data for the fiscal years
+ended June 30, 2021 and June 30, 2020, and the summary consolidated balance sheet data as of June 30, 2021 and June 30, 2020, are derived
+from our audited consolidated financial statements incorporated by reference. The consolidated statement of operations data for the three
+and nine months ended March 31, 2022 and 2021 and the summary consolidated balance sheet data as of March 31, 2022,
+are derived from our unaudited condensed consolidated financial statements incorporated by reference.
+
+ 
+
+The
+summarized financial information presented below is derived from and should be read in conjunction with our audited consolidated financial
+statements and our unaudited condensed consolidated financial statements incorporated by reference including the notes to those financial
+statements, both of which are incorporated by reference in this prospectus along with the section entitled Management s
+Discussion and Analysis of Financial Condition and Results of Operations. Our historical results are not necessarily indicative
+of our future results.
+
+ 
+
+ 
+ 
+ 
+ March 31,
+ 
+ 
+ June 30,
+ 
+
+ 
+ 
+ 
+ 2022
+ 
+ 
+ 2021
+ 
+ 
+ 2020
+ 
+
+ 
+ Consolidated Balance Sheets Data:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Cash, operating
+ 
+ $
+ 855,759
+ 
+ 
+ $
+ 230,685
+ 
+ 
+ $
+ 12,160
+ 
+
+ 
+ Cash, restricted
+ 
+ 
+ 1,664,873
+ 
+ 
+ 
+ 34,271
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Total current assets
+ 
+ 
+ 2,520,632
+ 
+ 
+ 
+ 264,956
+ 
+ 
+ 
+ 12,160
+ 
+
+ 
+ Total assets
+ 
+ 
+ 50,624,450
+ 
+ 
+ 
+ 303,378
+ 
+ 
+ 
+ 12,160
+ 
+
+ 
+ Total current liabilities
+ 
+ 
+ 11,412,917
+ 
+ 
+ 
+ 7,827,665
+ 
+ 
+ 
+ 18,708,560
+ 
+
+ 
+ Total liabilities
+ 
+ 
+ 26,119,132
+ 
+ 
+ 
+ 7,827,665
+ 
+ 
+ 
+ 18,708,560
+ 
+
+ 
+ Total stockholders equity
+ 
+ 
+ 24,505,318
+ 
+ 
+ 
+ (7,524,287
+ )
+ 
+ 
+ (18,696,400
+ )
+
+ 
+
+ 
+
+ 
+ 
+ 
+ For the Three Months Ended
+ 
+ 
+ For the Nine Months Ended
+ 
+ 
+ For the Years Ended
+ 
+
+ 
+ 
+ 
+ March 31,
+ 
+ 
+ March 31,
+ 
+ 
+ June 30,
+ 
+
+ 
+ 
+ 
+ 2022
+ 
+ 
+ 2021
+ 
+ 
+ 2022
+ 
+ 
+ 2021
+ 
+ 
+ 2021
+ 
+ 
+ 2020
+ 
+
+ 
+ Statement of Operations:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Revenue
+ 
+ $
+ 2,964,111
+ 
+ 
+ $
+ -
+ 
+ 
+ $
+ 5,244,952
+ 
+ 
+ $
+ -
+ 
+ 
+ $
+ 50,000
+ 
+ 
+ $
+ -
+ 
+
+ 
+ Operating expenses, excluding depreciation and amortization
+ 
+ 
+ 1,709,204
+ 
+ 
+ 
+ 91,239
+ 
+ 
+ 
+ 3,868,479
+ 
+ 
+ 
+ 286,629
+ 
+ 
+ 
+ 599,590
+ 
+ 
+ 
+ 326,614
+ 
+
+ 
+ Depreciation and amortization
+ 
+ 
+ -
+ 
+ 
+ 
+ 11,783
+ 
+ 
+ 
+ 154,399
+ 
+ 
+ 
+ 15,878
+ 
+ 
+ 
+ 99,960
+ 
+ 
+ 
+ 22,890
+ 
+
+ 
+ Income/(Loss) from operations
+ 
+ 
+ (1,035,031
+ )
+ 
+ 
+ (91,239)
+ 
+ 
+ 
+ (1,592,465
+ )
+ 
+ 
+ (286,629 )
+ 
+ 
+ 
+ (3,479,037
+ )
+ 
+ 
+ (10,740,327
+ )
+
+ 
+ Net income/(loss) attributable to parent
+ 
+ 
+ 3,372,853
+ 
+ 
+ 
+ 4,807,112
+ 
+ 
+ 
+ (629,693)
+ 
+ 
+ 
+ 8,543,125
+ 
+ 
+ 
+ (3,457,397
+ )
+ 
+ 
+ (10,740,327
+ )
+
+ 
+ 
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+Risk
+Factors
+
+ 
+
+An
+investment in our common stock involves a high degree of risk, including the potential loss of all or part of your investment. Before
+making an investment decision to purchase our common stock, you should carefully read and consider all the risks and uncertainties described
+below, some of which may be exacerbated by COVID-19, as well as other information included in this prospectus and the information incorporated
+by reference into this prospectus. The occurrence of any of the following risks or additional risks and uncertainties that are currently
+immaterial or unknown could have a material adverse effect on our business, results of operations, and financial condition and the price
+of our Common Stock could decline, and you may lose all or part of your investment. The following risk factors are not necessarily presented
+in order of relative importance and should not be considered to represent a complete set of all potential risks that could affect us.
+This prospectus contains forward-looking statements and estimates that involve risks and uncertainties. Our actual results could differ
+materially from those anticipated in forward-looking statements as a result of specific factors, including the risks and uncertainties
+described below. See
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001629205_innovation_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001629205_innovation_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..ba71841551f479581839f34b5ddcc43264a62868
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001629205_innovation_prospectus_summary.txt
@@ -0,0 +1,101 @@
+SUMMARY SECTION
+ 
+History
+ 
+The Company was originally incorporated under the laws of the State of Nevada on July 31, 2014 under the name My Cloudz Inc. From our formation on July 31, 2014 until October 9, 2017, we were engaged in the business of cloud storage services. On October 10, 2017, the Company completed a reverse merger with Gridiron BioNutrients, Inc., a Nevada corporation, with the Company being the surviving corporation in the merger. Effective November 28, 2017, the Company changed its name from My Cloudz, Inc. to Gridiron BioNutrients, Inc. From October 10, 2017 until November 9, 2021, the Company engaged in the business of developing and distributing a retail line of health water infused with probiotics and minerals. On November 9, 2021, the Company completed an acquisition of all of the assets, including intellectual property assets, relating to Mioxal , a nutraceutical complex composed of essential amino acids, natural coenzymes and minerals. Pursuant to the Acquisition, the Company has transitioned from developing and distributing a health water infused product to a research and development company. The Company is currently seeking the approval of FINRA to change its name to Innovation1 Biotech, Inc. 
+ 
+Overview
+ 
+We are a pharmaceutical, small molecule, research and development company focused on the discovery and clinical development of novel therapeutics for major unmet medical needs. We take already validated technologies and identify opportunities and deficiencies to refine and reengineer them, creating products with more desirable performance attributes. The candidate molecules in our portfolio have their genesis in natural product botanical chemistry but have been subsequently modified via synthetic chemistry to endow them with more favorable pharmaceutical characteristics.
+ 
+The Company s intellectual property portfolio comprises novel water-soluble prodrugs of payload molecules that have already demonstrated efficacy and tolerability in well-defined preclinical disease models. Despite their promise in such model systems, the translation of these payloads to the clinic is hampered by unfavorable druggability features, in particular their existing pharmacokinetic and bioavailability attributes. To overcome these pharmaceutical deficiencies, and thus to exploit the underlying promise of the payloads per se, the Company s prodrugs have been engineered to render them readily soluble in water, able to efficiency traverse mucosal barriers during absorption, and to blunt peak oscillations in plasma and tissue concentration. 
+ 
+The Company is developing a portfolio addressing five independent clinical indications, wherein the current therapeutic armamentarium is inadequate or non-existent. We are currently in the pre-clinical development stage for our five pharmaceutical candidates, all fully synthetic prodrugs without connection to botanical sourcing. Our goal is to become a leader in the development of modified Schedule I molecules of botanical origin, where there is the opportunity to effect breakthrough advances in diseases of unmet medical need; including a mushroom-derived psychedelic molecule for treatment post-traumatic stress disorder and depression, a novel cannabinoid for treatment of addiction and three additional novel cannabinoid prodrugs addressing clinical indications of refractory epilepsy, burn wounds and uveitis. 
+ 
+ 
+4
+
+Table of Contents
+ 
+The Company also owns a patented nutraceutical complex specially designed and formulated to contribute and help maintain normal energy metabolism, improve mood and reduce fatigue for those suffering from fibromyalgia and/or chronic fatigue syndrome. We look to initiate sales of this product in the marketplace in 2022.
+ 
+In order to achieve our goals, we have attracted and will continue to expand an experienced team of senior executives, along with a team of scientists accomplished in all facets of pharmaceutical research and development, drug formulation, clinical trial execution, and regulatory submissions. We intend to leverage the knowledge of our team in order to complete the clinical trials needed to receive approvals of our product candidates from applicable regulatory authorities. 
+ 
+Organization & Subsidiaries
+ 
+We have one operating subsidiary, GridIron Ventures, Inc., a Nevada corporation. Our wholly owned subsidiary, GridIron Ventures was incorporated on July 20, 2017, in Nevada. 
+ 
+Recent Developments
+ 
+Mioxal Acquisition
+ 
+On November 9, 2021, the Company completed the Acquisition of all of the assets, including intellectual property assets, relating to Mioxal , a nutraceutical complex composed of essential amino acids, natural coenzymes and minerals, held by ST BioSciences, Ltd., a company organized under the laws of England and Wales ( STB ). The Acquisition was completed pursuant to the terms of the Amended and Restated Asset Purchase Agreement (the Asset Purchase Agreement ), dated November 5, 2021, by and between the Company and STB. As consideration for the Acquisition, the Company issued 19,831,623 shares of Common Stock to STB, which at the closing of the Acquisition represented approximately 70% of the Company s outstanding shares of Common Stock on a fully-diluted basis. The closing of the Acquisition contemplated by the Asset Purchase Agreement on November 5, 2021, resulted in a change of control of the Company.
+ 
+The Mioxal asset was acquired by STB from Ingenius Biotech S.L, a Spain corporation ( Ingenius ) on September 10, 2021. The Ingenius milestone and stock payments were assumed by the Company in aggregate of $39,500,000 and are recorded in current and long-term liabilities in the accompanying consolidated balance sheets. Upon meeting the milestones, the first installment of $1,500,000 is due on January 15, 2022, the second installment of $1,500,000 on April 15, 2022 and $3,500,000 thereafter for each milestone event for an aggregate of $24,500,000. If the first milestone event does not occur on or before January 15, 2022, then the milestone payment will be forfeited and never owed. The milestone being a signed sales agreement with a third party to distribute Mioxal throughout Europe. In addition, Ingenius will receive three tranches of the Company s common stock beginning twelve months from execution of agreement with STB on September 10, 2021, as follows:
+ 
+ 
+ 
+On September 10, 2022 - $4,000,000
+ 
+ 
+ 
+
+ 
+ 
+On September 10, 2023 - $5,000,000
+ 
+ 
+ 
+
+ 
+ 
+On September 10, 2024 - $6,000,000
+ 
+ 
+ 
+
+ 
+ 
+Total stock to be issued - $15,000,000
+ 
+In addition, until the $39,500,000 is paid in cash and the Company s common stock, Ingenius will earn an 8% royalty on all sales generated by Mioxal .
+ 
+On January 13, 2022, the Company entered into an Amendment No. 1 to Purchase Agreement with Ingenius Biotech S.L. to modify the terms of the Amended and Restated Asset Purchase Agreement dated November 5, 2021. Pursuant to the amendment, we postpone certain payments due to Ingenuis as follows: a $1.5 million payment due on January 15, 2022 was extended to June 30, 2022 and a $1.5 million payment due on April 15, 2022 was extended to December 31, 2022.
+ 
+ 
+5
+
+Table of Contents
+ 
+Issuance of Series B Preferred Stock 
+ 
+On April 12, 2021, the Company filed a Certificate of Designations, Preferences, and Rights of the Series B Convertible Preferred Stock ( Series B Certificate ). The Series B Certificate designated 2,694,514 shares of the Company s blank check preferred stock as Series B Preferred Stock. In addition to rights granted to holders of Series B Preferred Stock under the Nevada Revised Statues, each holder is entitled to the whole number of votes equal to the number of shares of common stock into which such holder s Series B Preferred Stock would be convertible on the record date for the vote or consent of stockholders and shall otherwise have voting rights and powers equal to the voting rights and powers of the common stock. 
+ 
+Exchange Agreement with Cavalry Fund I LP
+ 
+In April 2021, the Company entered into an Exchange Agreement with Cavalry Fund I LP ( Cavalry Fund ) (the ( Exchange Agreement ) pursuant to which we agreed to issue Cavalry Fund 2,694,514 shares of our newly designated Series B Convertible Preferred Stock ( Series B Preferred ) in exchange for (i) 8,480,000 shares of our Series A Convertible Preferred Stock, (ii) outstanding common stock purchase warrants (the Warrants ), and (iii) all principal and accrued interest due under outstanding convertible promissory notes. As a result of the agreement, the convertible notes payable, convertible notes payable accrued interest, Series A Preferred stock dividends and derivative liability was reduced to $0 in the accompanying consolidated balance sheets for an aggregate of $2,588,86. On the date of the exchange, the Company exchanged 2,694,514 shares of the Company s Series B Preferred for the principal and interest on four convertible notes payable for $1,477,437, dividends payable on the Series A Preferred Stock of $105,432 and the Series A Preferred Stock for $1,006,000 for an aggregate of $2,588,869.
+ 
+Issuance of Series B-1 Preferred Stock
+ 
+On September 7, 2021, the Company consummated the initial tranche of its $2 million financing contemplated by that certain Series B-1 Purchase Agreement between the Company and Lincoln Park Capital Fund, LLC ( LPC ) pursuant to which the Company agreed to issue and sell to LPC up to 2,694,514 shares of its newly designated Series B-1 Convertible Preferred Stock (the Series B-1 Preferred ) at a Stated Value per share price of $0.742245 (or $2,000,000 in the aggregate). At the initial closing, the Company issued 673,628 shares of Series B-1 Preferred to LPC and received $500,000 in gross proceeds. 
+ 
+On October 28, 2021, the Company consummated the second tranche of the Series B-1 Preferred Stock investment, issuing an additional 637,628 shares of its Series B-1 Preferred Stock to LPC at a price per share of $0.742245 or $500,000.00 in the aggregate. 
+ 
+On November 9, 2021, the Company consummated the third and final tranche of the Series B-1 Preferred Stock investment, issuing an additional 1,347,256 shares of its Series B-1 Preferred Stock to LPC at a price per share of $0.742245 or $1,000,000.00 in the aggregate. The aggregate gross proceeds of $2,000,000 will be used by the Company as working capital.
+ 
+On November 24, 2021, the Company entered into, and consummated the financing contemplated by, that certain Series B-1 Purchase Agreement between the Company and L1 Capital Opportunities Master Fund Ltd. ( L1 Capital ), pursuant to which the Company issued and sold to L1 Capital 2,694,514 shares of its Series B-1 Preferred at a per share price of $0.742245, or $2,000,000 in the aggregate. 
+ 
+Pursuant to the terms of the respective purchase agreements with LPC and L1 Capital, each of LPC and L1 Capital agreed, for a period of 180 days following the final closing of such transaction, not to offer, sell, contract to sell, pledge, hypothecate, grant any option, right or warrant for the sale of, purchase any option or contract to sell, sell any option or contract to purchase, or otherwise encumber, dispose of or transfer, or grant any rights with respect to, directly or indirectly, any shares of Series B-1 Preferred or any shares of the Company s common stock issuable upon conversion of the Series B-1 Preferred. In addition, each of LPC and L1 Capital, along with the holders of the Company s Series B Preferred Stock has been granted the right (until the earlier of (i) the sixteen (16) month anniversary of the Closing Date or (ii) the listing of the Common Stock on a national securities exchange) to participate in up to 10% of the Company s future equity or equity-linked financings. Furthermore, the Company granted these stockholders certain piggyback registration rights with respect to the Common Stock issuable upon conversion of the Series B-1 Preferred and Series B Preferred issued to such stockholder. 
+ 
+ 
+6
+
+Table of Contents
+ 
+Retirement of Timothy S. Orr 
+ 
+Timothy S. Orr was the sole officer, director and employee of the Company during the fiscal year ended August 31, 2021. As part of the Acquisition, Mr. Orr, stepped down as the Company s Chief Executive Officer and assumed the role of the Company s Interim Chief Financial Officer. On January 1, 2022, Timothy S. Orr resigned as Interim Chief Financial Officer effective as of January 14, 2022. On February 9, 2022, Timothy S. Orr resigned from the Board of Directors. 
+ 
+Risks Associated with our Business:
+ 
+Investing in our common stock involves a high degree of risk. You should carefully consider the risks described in Risk Factors beginning on page 8 before deciding to invest in our common stock. If any of these risks actually occurs, our business, financial condition, results of operations and prospects would likely be materially, adversely affected. In that event, the trading price of our common stock could decline, and you could lose part or all of your investment. Below is a
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001645260_todos_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001645260_todos_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..22dad921737cbe1fca6eb75fdecb861653767197
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001645260_todos_prospectus_summary.txt
@@ -0,0 +1,942 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights selected information appearing elsewhere in this prospectus. While this summary highlights what we consider to be
+important information about us, you should carefully read this entire prospectus before investing in our securities, especially the risks
+and other information we discuss under the headings Risk Factors and Management s Discussion and Analysis
+of Financial Condition and Results of Operation and our consolidated financial statements and related notes beginning on page
+F-1. Our fiscal year end is December 31 and our fiscal years ended December 31, 2021, and 2020 are sometimes referred to herein as fiscal
+years 2021, and 2020, respectively. Some of the statements made in this prospectus discuss future events and developments, including
+our future strategy and our ability to generate revenue, income and cash flow. These forward-looking statements involve risks and uncertainties
+which could cause actual results to differ materially from those contemplated in these forward-looking statements. See Cautionary
+Note Regarding Forward-Looking Statements . Unless otherwise indicated or the context requires otherwise, the words we, 
+ us, our , the Company or our Company or Todos refer to Todos Medical
+Ltd., a State of Israel corporation, and our subsidiaries.
+
+ 
+
+Overview
+
+ 
+
+ 
+ Todos Medical Ltd. ( Todos
+ Medical, Todos, the Company, we, our, us ), is a comprehensive
+ medical diagnostics and related solutions company focused on developing and distributing comprehensive solutions for COVID-19 screening
+ and diagnosis, and immune resisting treatments and supplements, and on developing blood tests for the early detection of cancer and
+ Alzheimer s disease.
+
+ 
+ 
+
+ 
+ Todos has entered into
+ distribution agreements with companies to distribute certain novel coronavirus (COVID-19) test kits. The agreements cover multiple
+ international suppliers of PCR testing kits and related materials and supplies, as well as antibody testing kits from multiple manufacturers
+ after completing validation of said testing kits and supplies in its partner CLIA/CAP certified laboratory in the United States.
+ Todos has combined the PCR testing kits with automated lab equipment to create lab workflows capable of performing up to 40,000 PCR
+ tests per day. Todos has entered into supply agreements with CLIA/CAP certified laboratories in the United States to deploy these
+ PCR workflows. Todos has formed strategic partnerships with Meridian Health and other strategic partners to deploy COVID-19 antigen
+ and antibody testing in the United States. Additionally, the Company is developing a lab-based COVID-19 3CL protease test to determine
+ whether a COVID-19 positive patient remains contagious after quarantine is complete and is further developing point-of-care-based
+ embodiments of the lab test for use in screening programs worldwide.
+
+ 
+ 
+
+ 
+ In
+ December 2020, Todos announced the commercial launch of its proprietary 3CL protease inhibitor dietary supplement Tollovid 
+ at The Alchemist s Kitchen in the SoHo district in Manhattan, New York. Tollovid, a mix of botanical extracts, is being targeted
+ to support healthy immune function against circulating coronaviruses. Tollovid s mechanism of action is to inhibit the activity
+ of the 3CL protease, a key protease required for the intracellular replication of coronaviruses. Tollovid was granted a Certificate
+ of Free Sale by the US Food & Drug Administration in August 2020, allowing its commercial sale anywhere in the United States.
+
+ 
+
+ On
+ July 22, 2021, the US Food & Drug Administration (FDA) granted a new Certificate of Free Sale for Tollovid Daily , the
+ newest member of the Company s Tollovid dietary supplement product line.
+
+ 
+
+ The
+ Certificate of Free Sale is for a twice-daily dosing regimen and, critically, a 3CL protease inhibitor claim. Each 60-pill bottle
+ of Tollovid Daily can help support and maintain healthy immune function for 30 days. The Company intends to establish a monthly subscription
+ model as part of its marketing launch campaign for Tollovid Daily immune system support. Tollovid and Tollovid Daily are both
+ 3CL protease inhibitor products developed under a joint venture with NLC Pharma which preceded the establishment of our subsidiary,
+ 3CL Sciences Ltd.
+
+ 
+ 
+
+ 
+
+ On
+ March 11, 2022, the Company entered into a Share Purchase Agreement (the SPA )
+ with 3CL Sciences Ltd. ( 3CL ), an Israeli corporation, and NLC Pharma
+ Ltd. ( NLC ), an Israeli corporation, pursuant to which (a) 3CL
+ Sciences will purchase all therapeutic, diagnostic, dietary supplement and pharmaceutical
+ assets from NLC that relate to 3CL protease biology (which is used in the development, manufacture,
+ sale and distribution of Tollovid and Tollovir ) from NLC in exchange for
+ a 100% equity interest in 3CL, (b) 3CL will allot 30.5% of its shares to the Company in exchange
+ for a total cash commitment of $8 million, (c) NLC will sell 7.54% of 3CL s issued
+ and outstanding shares to the Company in exchange for a total cash commitment of $2 million,
+ and (d) NLC will exchange 14.31% of 3CL s issued and outstanding shares for shares
+ of the Company having a market value of $3,800,000 on the day prior to the Closing, such
+ that the Company will own 52% of 3CL s issued and outstanding share capital and NLC
+ will own 48% of 3CL s issued and outstanding share capital. The Company and NLC have
+ agreed to identify a seasoned biopharmaceutical CEO to manage 3CL going forward. The board
+ of directors of 3CL Sciences will be made up of five (5) individuals: three (3) appointed
+ by the Company and two (2) appointed by NLC.
+
+ 
+ 
+
+ 
+
+ Additionally,
+ the Company s patented Todos Biochemical Infrared Analyses (TBIA) is a cancer-screening technology using peripheral blood analysis
+ that deploys deep examination into cancer s influence on the immune system, looking for biochemical changes in blood mononuclear
+ cells and plasma. Todos two internally developed cancer-screening tests, TMB-1 and TMB-2 have received a CE mark in Europe.
+ In July 2021, Todos completed the acquisition of U.S.-based medical diagnostics company Provista Diagnostics, Inc. to gain rights
+ to its Alpharetta, Georgia-based CLIA/CAP certified lab and Provista s proprietary commercial-stage Videssa breast cancer
+ blood test.
+
+ 
+ 
+
+ 
+ Todos is also developing
+ blood tests for the early detection of neurodegenerative disorders, such as Alzheimer s disease.
+
+ 
+ 
+
+ 
+ In
+ July 2020, Todos completed the acquisition of Breakthrough Diagnostics, Inc., the owner of the LymPro Test intellectual property,
+ from Amarantus Bioscience Holdings, Inc. (a company whose Executive Chairman has served as our CEO since January 2020).
+
+ 
+ 
+
+ 
+ At our annual general meeting
+ of shareholders held on August __, 2022, our shareholders voted to approve a reverse share split of the Company s Ordinary
+ Shares within a range of 1:2 to 1:1,000, to be effective at the ratio and on a date to be determined by the Board of Directors of
+ the Company (the Reverse Split ). Although our shareholders approved the Reverse Split, all per share amounts and calculations
+ in this prospectus and the accompanying consolidated financial statements do not reflect the effects of the Reverse Split, as the
+ Board of Directors has not determined the final ratio or the effective date of the Reverse Split.
+
+ 
+ 
+
+ 3
+
+ Table of Contents
+
+ 
+
+ 
+
+Recent
+Developments
+
+ 
+
+3CL
+Acquisition
+
+ 
+
+On March 11, 2022, the Company
+entered into a Share Purchase Agreement (the SPA ) with 3CL Sciences Ltd. ( 3CL ), an Israeli
+corporation, and NLC Pharma Ltd. ( NLC ), an Israeli corporation, pursuant to which (a) 3CL Sciences will purchase
+all therapeutic, diagnostic, dietary supplement and pharmaceutical assets from NLC that relate to 3CL protease biology (which is
+used in the development, manufacture, sale and distribution of Tollovid and Tollovir ) from NLC in exchange for a 100%
+equity interest in 3CL, (b) 3CL will allot 30.5% of its shares to the Company in exchange for a total cash commitment of $8 million,
+(c) NLC will sell 7.54% of 3CL s issued and outstanding shares to the Company in exchange for a total cash commitment of $2 million,
+and (d) NLC will exchange 14.31% of 3CL s issued and outstanding shares for shares of the Company having a market value
+of $3,800,000 on the day prior to the Closing, such that the Company will own 52% of 3CL s issued and outstanding
+share capital and NLC will own 48% of 3CL s issued and outstanding share capital. The Company and NLC have agreed to
+identify a seasoned biopharmaceutical CEO to manage 3CL going forward. The board of directors of 3CL Sciences will be made up
+of five (5) individuals: three (3) appointed by the Company and two (2) appointed by NLC.
+
+ 
+
+Provista
+Acquisition
+
+ 
+
+On
+April 19, 2021, the Company entered into an Agreement to Purchase Provista Diagnostics, Inc. ( Agreement to Purchase ) with
+Strategic Investment Holdings, LLC ( SIH ), Ascenda BioSciences LLC ( Ascenda ) and Provista Diagnostics, Inc.
+( Provista ). Ascenda was the sole owner of the outstanding securities of Provista and SIH is the sole owner of all the outstanding
+securities of Ascenda.
+
+ 
+
+Pursuant
+to the Agreement to Purchase, the Company acquired Provista from Ascenda and SIH for an aggregate purchase price of $7.5 million consisting
+of an initial cash payment of $1.25 million, the issuance of $1.5 million in Ordinary Shares priced at $0.0512 per share, the issuance
+to SIH of a $3.5 million convertible promissory note dated April 19, 2021 (the Note ) and the payment on for before July
+1, 2021 of $1.25 million in cash (the July Payment ), which payment the Company had the right to, and did, extend to July
+15, 2021. The Provista shares acquired by the Company remained in an escrow account until the July Payment was made.
+
+ 
+
+The
+Note has a maturity date of April 8, 2025, and is convertible into Ordinary Shares of the Company at a
+conversion price equal to the lesser of $0.05 or the volume weighted average price of the last 20 trading days for the Ordinary Shares
+prior to the date of conversion. In the event SIH delivers a Notice of Conversion to the Company at a per share price less than $0.05
+($0.05), the Company has the right to immediately notify SIH of its intention to pay the conversion amount in cash within three (3) business
+days of receipt of the Notice of Conversion (i.e., before SIH would take possession of shares converted under the Notice of Conversion).
+
+ 
+
+In
+the event that the Company lists its Ordinary Shares on a national securities exchange, the Note shall automatically be
+exchanged into ordinary shares with a conversion price equal to the lesser of (a) $0.05 (subject to adjustment for any reverse stock
+splits), (b) the opening price on the day of the uplisting provides there is no transaction associated with the uplisting or (c)
+the deal price of an uplisting transaction.
+
+ 
+
+As
+of the date of this registration statement on Form S-1, SIH has not submitted a Notice of Conversion.
+
+ 
+
+ 4
+
+ Table of Contents
+
+ 
+
+ 
+
+Products
+
+ 
+
+On
+July 22, 2021, the US Food & Drug Administration (FDA) granted a new Certificate of Free Sale for Tollovid Daily , the newest
+member of the Company s Tollovid dietary supplement product line.
+
+ 
+
+The
+Certificate of Free Sale is for a twice-daily dosing regimen and, critically, a 3CL protease inhibitor claim. Each 60-pill bottle of
+Tollovid Daily can help support and maintain healthy immune function for 30 days. The Company intends to establish a monthly subscription
+model as part of its marketing launch campaign for Tollovid Daily immune system support. Tollovid and Tollovid Daily are both
+3CL protease inhibitor products developed under a joint venture with NLC Pharma.
+
+ 
+
+On
+April 8, 2021, we received a notice of allowance ( Letter of Intent to Grant a Patent ) from the European Patent Office covering
+the use of the Company s proprietary Total Biochemical Infrared Analysis ( TBIA ) method that uses blood (plasma and/or
+peripheral blood mononuclear cells PBMCs ) to distinguish between patients with benign tumors vs. malignant tumors vs. no
+tumors (healthy controls).
+
+ 
+
+The
+patent application specifically covers methods for capturing consistent data from infrared spectroscopy readers, as well as the application
+of various artificial intelligence algorithm development methods to the data. The ability of TBIA to make a diagnosis of cancer has first
+been applied to the detection of breast and colon cancers, where Todos has received CE Marks in Europe paving the way for commercialization
+initially focused on TMB-2 (dense breast / inconclusive mammogram secondary screening) and TMB-1 (general breast cancer screening) cancer
+detection tests.
+
+ 
+
+Financing
+and Fundraising Other Than Crossover Notes
+
+ 
+
+Toledo
+
+ 
+
+On
+June 19, 2020, the Company and its subsidiaries, Todos Medical USA and Corona Diagnostics, LLC ( Corona ) entered into a
+Receivables Financing Agreement with Toledo Advisors, LLC ( Toledo ) for up to $25,000,000 in a revolving receivables financing
+facility (the Facility ). The availability of the Facility shall terminate on the earlier of June 19, 2025 and the date
+on which more than $25,000,000 has been advanced. The financing is secured by all of the assets of the Company s wholly-owned subsidiary
+Todos Medical USA, Inc. In addition, Todos Medical USA pledged all of the outstanding equity of Corona to the Lender. The initial draw
+under the Facility was on June 19, 2020 for $165,000 which was due on the earlier to occur of (i) ninety days following the date the
+draw was made by the Lender and (ii) the date the receivable, for which the draw was made, is paid. The Facility has since been repaid.
+
+ 
+
+In
+November 2020, the parties agreed to amend the Facility to reduce the cost of funding to Todos Medical USA, and to make the relationship
+between Corona and Toledo nonexclusive in exchange for Toledo being granted a percentage of Corona s revenues from diagnostic testing.
+
+ 
+
+On
+January 7, 2022, Toledo filed a complaint against Corona, Todos Medical USA, and the Company (the Todos Defendants ), seeking
+unspecified damages for breach of the aforesaid agreements and claiming that at least $139,000 is due under the royalty agreement. The
+Todos Defendants filed an answer and counterclaim on February 9, 2022, wherein various affirmative defenses were asserted, the allegations
+of the complaint were denied, and the Company asserted counterclaims for breach of contract and other relief.
+
+ 
+
+On
+April 7, 2022, the Company and Toledo signed a Settlement Agreement pursuant to which upon execution of the agreement the Company paid
+Toledo $130,000 and issued to Toledo $200,000 worth of ordinary shares. The parties agreed that upon delivery of the cash payment and
+shares, the parties would discontinue the complaint filed by Toledo on January 7, 2022, and that Toledo irrevocably and unconditionally
+releases and discharges the Company from its June 19, 2020 financing agreement and July 28, 2020 Royalty Agreement.
+
+ 
+
+Leviston
+
+ 
+
+The
+Company and Leviston Resources LLC, a Delaware limited liability company are parties to that certain Securities Purchase Agreement, dated
+as of July 9, 2020, pursuant to which Leviston purchased an aggregate principal amount of $850,000 of convertible notes from the Company
+(the July 2020 Convertible Notes ) from the Company. On March 3, 2021, the Company and Leviston entered into a Closing Agreement
+pursuant to which the Purchaser exercised its right to invest an additional $847,570 into the Company of July 2020 Convertible Notes
+(the Tranche 2 Securities ).
+
+ 
+
+The
+July 2020 Convertible Notes and the Tranche 2 Securities (collectively, the Leviston Notes ) bear interest at a rate of
+2% per annum. The Leviston Notes are convertible into ordinary shares of the Company at a conversion price that equals the lower of (i)
+60% of the lowest VWAP trading price of the ordinary shares during the eleven trading days immediately prior to the date of conversion,
+(ii) 150% of the closing bid price of the ordinary shares on such closing date and (iii) 150% of the closing bid price on
+the date of effectiveness of the Company s registration statement covering the converted shares.
+
+As
+of the date of this prospectus, $389,250 remains outstanding on the Leviston Notes (the remainder having previously been converted into
+ordinary shares).
+
+ 
+
+Lincoln Park 
+
+ 
+
+On
+August 4, 2020, we entered into a purchase agreement (the LPC Purchase Agreement ) with Lincoln Park Capital, LLC ( Lincoln
+Park ), pursuant to which Lincoln Park agreed to purchase from us up to an aggregate of $10,275,000 of our ordinary shares (subject
+to certain limitations) from time to time over the term of the LPC Purchase Agreement. Also on August 4, 2020, we entered into a registration
+rights agreement with Lincoln Park, pursuant to which on August 11, 2020, we filed with the Securities and Exchange Commission, or the
+SEC, a registration statement (the LPC Registration Statement ) to register for resale under the Securities Act of 1933,
+as amended, or the Securities Act, the ordinary shares that have been or may be issued to Lincoln Park under the LPC Purchase
+Agreement. That registration statement became effective on August 18, 2020.
+
+ 
+
+ 5
+
+ Table of Contents
+
+ 
+
+ 
+
+The
+LPC Registration Statement covers the resale by Lincoln Park of up to 50,000,000 ordinary shares, comprised of: (i) 5,812,500 ordinary
+shares that we issued to Lincoln Park as a fee for making its irrevocable commitment to purchase our ordinary shares under the LPC
+Purchase Agreement, which we refer to in this registration statement on Form S-1 as the Commitment Shares, (ii) 3,437,500 ordinary
+shares that we sold to Lincoln Park on August 5, 2020 for a total purchase price of $275,000 in an initial purchase under the LPC
+Purchase Agreement the ( Initial Purchase Shares ), and (iii) up to an additional 40,750,000 ordinary shares that we
+have reserved for sale to Lincoln Park under the LPC Purchase Agreement from time to time after the date of the LPC Registration Statement,
+if and when we determine to sell additional ordinary shares to Lincoln Park under the LPC Purchase Agreement. Since August 18, 2020,
+Lincoln Park has purchased 37,977,388 of our ordinary shares under the LPC Purchase Agreement, at prices ranging from $ 0.038
+per share to $ 0.115 per share. The Company does not currently expect to sell any more shares to Lincoln Park under the LPC Purchase
+Agreement.
+
+ 
+
+The
+LPC Purchase Agreement prohibits us from directing Lincoln Park to purchase any ordinary shares if those ordinary shares, when
+aggregated with all other ordinary shares then beneficially owned by Lincoln Park and its affiliates, would result in Lincoln Park having
+beneficial ownership, at any single point in time, of more than 4.99% of the then total outstanding ordinary shares, as calculated pursuant
+to Section 13(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and Rule 13d-3 thereunder, which limitation
+we refer to as the Beneficial Ownership Cap.
+
+ 
+
+Issuances
+of our ordinary shares to Lincoln Park under the LPC Purchase Agreement will not affect the rights or privileges of our existing
+shareholders, except that the economic and voting interests of each of our existing shareholders will be diluted as a result of any such
+issuance. Although the number of ordinary shares that our existing shareholders own will not decrease, the ordinary shares owned by our
+existing shareholders will represent a smaller percentage of our total outstanding ordinary shares after any such issuance of ordinary
+shares to Lincoln Park under the LPC Purchase Agreement.
+
+ 
+
+Yeshiva Orot Hateshuva
+
+ 
+
+On
+November 4, 2020, we entered into a Secured Convertible Equipment Loan Agreement with Friends of Yeshiva Orot Hateshuva Inc. ( Friends ),
+pursuant to which Friends lent us $450,000 to purchase two liquid handler machines. Under the terms of the agreement, the note was issued
+with 41.4% Original Issue Discount, with Friends receiving a royalty of 12.5% of all amounts resulting from any diagnostic tests performed
+by the two liquid handler machines. During the initial payback period and up until the earlier of either (a) the Maturity Date, or (b)
+the aggregate loan amount is paid in full, all Royalty payments made to Investor will be counted towards their loan balance. Thereafter,
+the royalties continue so long as the machines are in use. The Maturity Date was March 4, 2021. On March 4, 2021, the Company and Friends
+agreed to extend the maturity date of the note to May 1, 2021, in exchange for a payment of $100,000 and the issuance of 2,000,000 ordinary
+shares, in each case to a charity designated by Friends. As of March 25, 2022, the Company has not made any royalty payments to Friends.
+The note has been repaid.
+
+ 
+
+Harper Advance
+
+ 
+
+On
+December 31, 2020, we entered into a Secured Convertible Equipment Loan Agreement with Harper Advance LLC ( Harper ), pursuant
+to which Harper lent us $450,000 to purchase two liquid handler machines. Under the terms of the agreement, the note was issued with
+40% Original Issue Discount, with Harper receiving a royalty of 12.5% of all amounts resulting from any diagnostic tests performed by
+the two liquid handler machines. During the initial payback period and up until the earlier of either (a) the Maturity Date, or (b) the
+aggregate loan amount is paid in full, all Royalty payments made to Investor will be counted towards their loan balance. Thereafter,
+the royalties continue so long as the machines are in use. The Maturity Date was April 30, 2021. As of March 25, 2022, the Company
+has not made any royalty payments to Harper. Harper s note was purchased by another investor and converted into ordinary shares
+of the Company.
+
+ 
+
+T-Cell
+Protect Hellas S.A.
+
+ 
+
+On
+November 22, 2021, the Company entered into a Securities Purchase Agreement with T-Cell Protect Hellas S.A. ( T-Cell ) pursuant
+to which the Company agreed to issue a convertible promissory note (the Note ) to T-Cell Protect in the principal amount
+of 1,000,000. To date, T-Cell has not fulfilled its obligation to pay for the Note, and therefore the Company has not yet issued
+the Note. The proceeds from this Transaction are intended to be used for the clinical development of Tollovir, the Company s therapeutic
+candidate for hospitalized COVID-19 patients.
+
+ 
+
+Testing
+123, LLC
+
+ 
+
+On
+March 14, 2022, the Company and Testing 123, LLC (the Lender ) signed a Revolving Line of Credit Agreement, pursuant to
+which the Lender will provide the Company with a credit facility of up to $1,250,000 bearing a monthly interest of 5% calculated for
+a minimum period of 60 days. The Company may request advances under the agreement from the date of the agreement and until March 14,
+2023. The Maturity Date of each draw will be the earlier of (i) 60 days from the date of the loan, (ii) the occurrence of an event of
+default as defined in the agreement and (iii) with respect to funds received by the Company through collections on receivables included
+in a Receivables Pool, as defined in the agreement, 3 days after such funds have been received by the escrow account agent or the Company.
+Additionally, under the terms of the Revolving Line of Credit Agreement, the Company agreed to issue to Testing 123, LLC, shares equal
+to a 10% ownership stake in Provista, which interest is protected against dilution. As of March 31, 2022, the Company utilized $999,000
+out of the credit facility. The Company has estimated the portion of the 10% shares of Provista at $740,000 and recorded $598,000 as
+interest expenses and $142,000 as prepaid interest expenses under Other Current Assets.
+
+ 
+
+Crossover Notes
+
+ 
+
+Yozma
+
+ 
+
+On
+January 22, 2021, we entered into a Securities Purchase Agreement with Yozma Group Korea Ltd. (the First Yozma Purchaser )
+pursuant to which on January 29, 2021, the Company issued a convertible promissory note to the Purchaser in the principal amount
+of $4,857,142.86 for proceeds of $3,400,000 (the Transaction ). The note has a maturity date of one year from the
+date of issuance and pays interest at a rate of 4% per annum. In addition, the First Yozma Purchaser received a warrant to purchase
+up to 16,956,929 Ordinary Shares of the Company with an exercise price equal to $0.107415 per share. The warrant is exercisable for 5
+years from the date of issuance. In the event that the Company effectuates a reverse split of its ordinary shares for a ratio in excess
+of 1:20, the resulting adjusted warrant shares and exercise price are limited to a 1:20 ratio.
+
+ 
+
+The
+note is convertible into Ordinary Shares of the Company at a conversion price of $0.0599. In the event that the Company lists its Ordinary Shares on a national securities exchange, the First
+Yozma Purchaser, upon request of the Company, will be obligated to exchange its note for Preferred A Shares that convert, solely at the
+discretion of the Company s Board of Directors, into Ordinary Shares at a conversion rate of 1,000 Ordinary Shares per Preferred
+A Share. As of July 22, 2022, there are 50,000 Preferred A Shares authorized which equals a total possible issuance of 50 million Ordinary
+Shares pursuant to the conversion of the Preferred A Shares.
+
+ 
+
+On
+April 27, 2021, we entered into a Securities Purchase Agreement (the SPA ) with Yozma Global Genomic Fund (the Second
+Yozma Purchaser and together with the First Yozma Purchaser, the Yozma Purchasers ) pursuant to which on April 28,
+2021, the Company issued a convertible promissory note to the Purchaser in the principal amount of $4,714,285.71
+for proceeds of $3,300,000. The note has a maturity date of one year from the date of issuance and pays
+interest at a rate of 4% per annum. The note is convertible into Ordinary Shares of the Company at a conversion price of $0.0599. In the event that the Company lists its Ordinary Shares on a national
+securities exchange, the Second Yozma Purchaser, upon request of the Company, will be obligated to exchange its note for Preferred A
+Shares that convert, solely at the discretion of the Company s Board of Directors, into Ordinary Shares at a conversion rate of
+1,000 Ordinary Shares per Preferred A Share.
+
+ 
+
+The
+notes issued to the Yozma Purchasers are currently past due, and the Company is negotiating an extension of the maturity dates
+with Yozma.
+
+ 
+
+ 6
+
+ Table of Contents
+
+ 
+
+ 
+
+Kips Bay
+
+ 
+
+On
+April 8, 2021, the Company entered into a Securities Purchase Agreement with Kips Bay Select LP (the Purchaser ) pursuant
+to which the Company agreed to issue a convertible promissory note (the First Kips Bay Note ) to the Purchaser
+in the principal amount of $4,285,714.29 for proceeds of $3,000,000. The closing occurred on April 12, 2021. The First Kips Bay
+Note has a maturity date of one year from the date of issuance and pays interest at a rate of 4% per annum. In addition, the
+Purchaser received a warrant to purchase up to 16,000,000 Ordinary Shares of the Company with an exercise price equal to $0.107415 per
+share. The warrant is exercisable for 5 years from the date of issuance. In the event that the Company effectuates a reverse split of
+its Ordinary Shares for a ratio in excess of 1:20, the resulting adjusted warrant shares and exercise price are limited to a 1:20 ratio.
+The Company used the net proceeds from the First Kips Bay Note to initiate the Phase 2 for Tollovir clinical trial in COVID-19
+patients, complete the acquisition of Provista Diagnostics, Inc. and for general corporate purposes.
+
+ 
+
+The
+First Kips Bay Note is convertible into Ordinary Shares at a conversion price of $0.0599. In the event that the Company lists its Ordinary Shares on a national securities exchange, the Purchaser, upon request of
+the Company, will be obligated to exchange the Original Issue Discount portion of the First Kips Bay Note for Preferred A Shares, while the Purchaser may
+elect to convert the remaining principal amount of its notes.
+
+ 
+
+The First Kips Bay Note is currently past due and the Company is negotiating an extension of the maturity date with the Purchaser.
+
+ 
+
+Until
+May 5, 2022, the Purchaser had the option to purchase an additional note in the principal amount of $5,285,714.20 for proceeds
+of $3,700,000 and an additional warrant to purchase 16,000,000 Ordinary Shares. The purchaser did not exercise the option.
+
+ 
+
+On
+July 7, 2021, the Company entered into a Securities Purchase Agreement with the Purchaser pursuant to which the Company agreed to issue
+a convertible promissory note (the Second Kips Bay Note ) to the Purchaser in the principal amount of $1,535,714
+for proceeds of $1,075,000. The closing occurred on July 7, 2021. In addition, the Purchaser received a warrant to purchase up to
+3,440,000 Ordinary Shares of the Company with an exercise price equal to $0.107415 per share. The warrant is exercisable for 5 years
+from the date of issuance. The Second Kips Bay Note has a maturity date of one year from the date of issuance and pays
+interest at a rate of 4% per annum. The Second Kips Bay Note is convertible into Ordinary Shares of the Company at a conversion
+price of $0.0599. In the event that the Company lists its Ordinary Shares on a national securities exchange, the Purchaser, upon request
+of the Company, will be obligated to exchange the Original Issue Discount portion of the Second Kips Bay Note for Preferred A Shares,
+while the Purchaser may elect to convert the remaining principal amount of its notes. The Company used the net proceeds for general corporate
+purposes.
+
+ 
+
+The
+Second Kips Bay Note is currently past due and the Company is negotiating an extension of the maturity date
+with the Purchaser.
+
+ 
+
+On
+October 21, 2021, Todos Medical Ltd. (the Company ) entered into a Securities Purchase Agreement with the Purchaser
+pursuant to which the Company agreed to issue a convertible promissory note (the Third Kips Bay Note ) to the Purchaser
+in the principal amount of $1,428,571.43 for proceeds of $1,000,000. The closing occurred on October 22, 2021. In addition, the
+Purchaser received a warrant to purchase up to 3,440,000 ordinary shares with an exercise
+price equal to $0.107415 per share. The warrant is exercisable for 5 years from the date of issuance. The Third Kips Bay Note has a
+maturity date of one year from the date of issuance and pays interest at a rate of 4% per annum. The Third Kips Bay Note is
+convertible into ordinary shares at a conversion price of $0.0599. In the event that the Company lists its Ordinary Shares on
+a national securities exchange, the Purchaser, upon request of the Company, will be obligated to exchange the Original Issue
+Discount portion of its Third Kips Bay Note for Preferred A Shares, while the Purchaser may elect to convert the remaining principal
+amount of its notes. The Company intends to use the net proceeds from this Third Kips Bay Note to continue funding the ongoing Phase
+2 clinical trial of Tollovir in hospitalized COVID-19 patients, beginning the initial marketing campaign for the cPass
+neutralizing antibody test launch at Provista Diagnostics and general corporate purposes.
+
+ 
+
+Mekarkain
+
+ 
+
+On
+July 6, 2021, the Company entered into a Securities Purchase Agreement with S.B. Nihul Mekarkain pursuant to which the Company issued
+a convertible promissory note to Mekarkain in the principal amount of $285,714 for proceeds of $200,000. The closing occurred on July
+6, 2021. In addition, Mekarkain received a warrant to purchase up to 997,466 Ordinary Shares of the Company with an exercise price equal
+to $0.107415 per share. The warrant is exercisable for 5 years from the date of issuance. The Company used the net proceeds for general
+corporate purposes. The note has a maturity date of one year from the date of issuance and pays interest at a rate of 4% per annum. The
+note is convertible into Ordinary Shares at a conversion price of $0.0599. In the event that the Company lists its Ordinary Shares on
+a national securities exchange, Mekarkain, upon request of the Company, will be obligated to exchange its note for Preferred A Shares
+that convert, solely at the discretion of the Company s Board of Directors, into Ordinary Shares at a conversion rate of 1,000
+Ordinary Shares per Preferred A Share.
+
+ 
+
+The note is currently
+past due and the Company is negotiating an extension of the maturity date with Mekarkain.
+
+ 
+
+Mercer
+Street
+
+ 
+
+On
+September 23, 2021, the Company completed the conditions precedent required to enter into a Securities Purchase Agreement with Mercer
+Street Global Opportunity Fund, LLC pursuant to which the Company issued a convertible promissory note to Mercer Street
+in the principal amount of $2,285,142.86 for proceeds of $2,000,000. In addition, the Purchaser received a warrant to purchase up
+to 11,924,636 Ordinary Shares of the Company with an exercise price equal to $0.107415 per share. The warrant is exercisable for 5 years
+from the date of issuance. The Company intends to use the net proceeds from the conversion shares and the warrant shares to initiate
+Phase 2/3 trials for Tollovir COVID-19 patients, initiate digital marketing for its dietary supplement Tollovid , increase
+sales & marketing for Provista Diagnostics, and for general corporate purposes. The note has a maturity date of one year
+from the date of issuance and pays interest at a rate of 4% per annum. The note is convertible into Ordinary Shares of the Company at a conversion price of $0.0599. In the event that the Company
+lists its Ordinary Shares on a national securities exchange, Mercer Street, upon request of the Company, will be obligated to exchange
+the Original Issue Discount portion of its note for Preferred A Shares, while Mercer Street may elect to convert the remaining principal
+amount of its notes.
+
+ 
+
+Quick
+Capital
+
+ 
+
+On
+August 9, 2021, the Company entered into a Securities Purchase Agreement with Quick Capital, LLC pursuant to which the Company issued
+a convertible promissory note to Quick Capital in the principal amount of $142,857 for proceeds of $100,000. The closing occurred on
+August 9, 2021 . In addition, Quick Capital received a warrant to purchase up to 498,733 Ordinary Shares of the Company with an exercise
+price equal to $0.107415 per share. The warrant is exercisable for 5 years from the date of issuance. The Company used the net proceeds
+for general corporate purposes. The note has a maturity date of one year from the date of issuance and pays interest at a rate of 4%
+per annum. The note is convertible into Ordinary Shares at a conversion price of $0.0599. In the event that the Company lists its Ordinary
+Shares on a national securities exchange, Quick Capital, upon request of the Company, will be obligated to exchange its note for Preferred
+A Shares that convert, solely at the discretion of the Company s Board of Directors, into Ordinary Shares at a conversion rate
+of 1,000 Ordinary Shares per Preferred A Share.
+
+ 
+
+On
+December 14, 2021, the Company entered into a Securities Purchase Agreement with Quick Capital pursuant to which the Company issued a
+convertible promissory note to Quick Capital in the principal amount of $142,857 for proceeds of $100,000. The note has a maturity date
+of one year from the date of issuance and pays interest at a rate of 4% per annum. The note is convertible into Ordinary Shares at a
+conversion price of $0.0599. In addition, Quick Capital received a warrant to purchase up to 5,613,334 Ordinary Shares of the Company
+with an exercise price equal to $0.107415 per share. The warrant is exercisable for 5 years from the date of issuance. The Company intends
+to use the net proceeds for general corporate purposes. In the event that the Company lists its Ordinary Shares on a national securities
+exchange, Quick Capital, upon request of the Company, will be obligated to exchange its note for Preferred A Shares that convert, solely
+at the discretion of the Company s Board of Directors, into Ordinary Shares at a conversion rate of 1,000 Ordinary Shares per Preferred
+A Share.
+
+ 
+
+ 7
+
+ Table of Contents
+
+ 
+
+ 
+
+Greentree
+
+ 
+
+On
+October 11, 2021, the Company entered into a Securities Purchase Agreement with Greentree Financial Group pursuant to which the Company
+issued a convertible promissory note to the Purchaser in the principal amount of $428,571 for proceeds of $300,000. In addition, Greentree
+received a warrant to purchase up to 1,252,087 Ordinary Shares of the Company with an exercise price equal to $0.107415 per share. The
+warrant is exercisable for 5 years from the date of issuance. The Company used the net proceeds for general corporate purposes. The note
+has a maturity date of one year from the date of issuance and pays interest at a rate of 4% per annum. The note is convertible into Ordinary
+Shares at a conversion price of $0.0599. In the event that the Company lists its Ordinary Shares on a national securities exchange, Greentree,
+upon request of the Company, will be obligated to exchange the Original Issue Discount portion of its note for Preferred A Shares, while
+Greentree may elect to convert the remaining principal amount of its notes.
+
+ 
+
+Leonite
+
+ 
+
+On
+November 2, and November 24, 2021, the Company entered into a Securities Purchase and other related documents with Leonite Fund I, LP
+pursuant to which the Company issued a convertible promissory note to Leonite in the principal amount of $1,432,142 for proceeds of $1,002,500.
+The closing occurred on November 2, 2021. The note has a maturity date of one year from the date of a issuance and pays interest at a
+rate of 4% per annum. The note is convertible into Ordinary Shares at a conversion price of $0.0599.
+
+ 
+
+In
+addition, the Purchaser received a warrant to purchase up to 5,613,334 Ordinary Shares of the Company with an exercise price equal to
+$0.107415 per share. The warrant is exercisable for 5 years from the date of issuance. The Company intends to use the net proceeds for
+general corporate purposes.
+
+ 
+
+In
+the event that the Company lists its Ordinary Shares on a national securities exchange, Leonite, upon request of the Company, will be
+obligated to exchange the Original Issue Discount portion of its note for Preferred A Shares, while Leonite may elect to convert the
+remaining principal amount of its notes.
+
+ 
+
+Ascendant
+
+ 
+
+On
+December 21, 2021, the Company entered into a Securities Purchase Agreement with Ascendant, LLC pursuant to which the Company issued
+a convertible promissory note to Ascendant in the principal amount of $300,000 for proceeds of $210,000. The closing occurred on December
+21, 2021. In addition, Ascendant received a warrant to purchase up to 1,252,087 Ordinary Shares of the Company with an exercise price
+equal to $0.107415 per share. The warrant is exercisable for 5 years from the date of issuance. The Company used the net proceeds for
+general corporate purposes. The note has a maturity date of one year from the date of issuance and pays interest at a rate of 4% per
+annum. The note is convertible into Ordinary Shares at a conversion price of $0.0599. In the event that the Company lists its Ordinary
+Shares on a national securities exchange, Ascendant, upon request of the Company, will be obligated to exchange the Original Issue Discount
+portion of its note for Preferred A Shares, while Ascendant may elect to convert the remaining principal amount of its notes.
+
+ 
+
+Crossover Notes
+Registration Statement
+
+ 
+
+On
+May 13, 2021, the Company filed a registration statement on Form S-1, registering for resale all of the conversion shares and the warrant
+shares described above under the headings of Kips Bay, Mekarkain, Mercer Street, Quick Capital, Greentree, Leonite, and Ascendant (the
+ Registration Statement), except for the conversion shares issuable to Yozma Purchasers and the conversion shares issuable under
+the First Kips Bay Note, all of which were already saleable under Rule 144. The Registration Statement was subsequently amended in January
+2022 and February 2022 and was declared effective on February 4, 2022. Subsequent to the effective date of the Registration Statement,
+if the closing sale price of the Ordinary Shares averages less than the then conversion price over a period of ten (10) consecutive trading
+days, the conversion price shall reset to such average price. If the 10 day volume weighted average price of the Ordinary Shares continues
+to be less than the conversion price then the conversion price should reset to such 10-day average price with a maximum of a 20% discount
+from the initial Conversion Price.
+
+ 
+
+ 8
+
+ Table of Contents
+
+ 
+
+ 
+
+Reverse
+Split
+
+ 
+
+At
+an extraordinary general meeting of our shareholders held on August __, 2022, our shareholders voted to approve a reverse share split
+of the Company s ordinary shares within a range of 1:2 to 1:1,000, to be effective at the ratio and on a date to be determined
+by the Board of Directors of the Company (the Reverse Split ). Although our shareholders approved the Reverse Split, all
+per share amounts and calculations in this registration statement on Form S-1 and the accompanying financial statements do not reflect
+the effects of the Reverse Split, as the Board of Directors has not determined the ratio or the effective date of the Reverse Split.
+
+ 
+
+SARS-nCoV-2
+Related Business
+
+ 
+
+With
+the onset of COVID-19, Todos sought to apply its expertise in developing blood tests for the early detection of cancer and Alzheimer s
+disease to distributing and then developing screening tests for the pandemic.
+
+ 
+
+On
+March 23, 2021, we announced that we have entered into an automation and reagent supply agreement with MAJL Diagnostics ( MAJL ).
+Under the terms of the agreement, Todos will implement its automation solution, including Tecan liquid handlers, automated RNA
+extraction machines, as well as a 384-well PCR machine capable of conducting COVID, cancer genetics and pharmacogenomics testing, in
+order to become the provider of all COVID-19 PCR testing reagents and supplies.
+
+ 
+
+On
+March 29, 2021, we announced the successful installation of automated lab equipment and completion of training for a lab client in Brooklyn,
+NY. The implementation of the Todos automation solution has expanded the lab s processing capacity to 6,000 PCR tests per day from
+500 PCR tests per day, with the potential to quickly expand to up to 12,000 PCR tests per day. The lab will be implementing EUA approved
+PCR testing for COVID-19 testing, as well as COVID + influenza A & B PCR testing upon request for select clients. Additionally, through
+the future implementation of pooling, the lab could potentially increase processing capacity to in excess of 40,000 PCR tests per day
+at a 4:1 ratio.
+
+ 
+
+On
+March 30, 2021, we announced that we have entered into a distribution partnership with Osang Healthcare (OHC) of South Korea, to distribute
+the GeneFinder COVID-19 Plus RealAMP Kit in the United States. Todos intends to make GeneFinder Plus the primary kit used for
+distribution in its fully integrated and automated COVID-19 PCR testing lab solutions. GeneFinder Plus has been granted Emergency Use
+Authorization (EUA) by the US FDA.
+
+ 
+
+We
+market our COVID-19 test kits directly to clinical laboratories throughout the U.S. as well as through our distributors, who include
+Meridian, Dynamic Distributors, LLC, and others.
+
+ 
+
+On
+March 11, 2022, the Company entered into a Share Purchase Agreement (the SPA ) with 3CL Sciences Ltd. ( 3CL ),
+an Israeli corporation, and NLC Pharma Ltd. ( NLC ), an Israeli corporation, pursuant to which (a) 3CL Sciences
+will purchase all therapeutic, diagnostic, dietary supplement and pharmaceutical assets from NLC that relate to 3CL protease biology
+(which is used in the development, manufacture, sale and distribution of Tollovid and Tollovir ) from NLC in exchange
+for a 100% equity interest in 3CL, (b) 3CL will allot 30.5% of its shares to the Company in exchange for a total cash commitment of $8
+million, (c) NLC will sell 7.54% of 3CL s issued and outstanding shares to the Company in exchange for a total cash commitment
+of $2 million, and (d) NLC will exchange 14.31% of 3CL s issued and outstanding shares for shares of the Company having a market
+value of $3,800,000 on the day prior to the Closing, such that the Company will own 52% of 3CL s issued and outstanding share capital
+and NLC will own 48% of 3CL s issued and outstanding share capital. The Company and NLC have agreed to identify a seasoned biopharmaceutical
+CEO to manage 3CL going forward. The board of directors of 3CL Sciences will be made up of five (5) individuals: three (3) appointed
+by the Company and two (2) appointed by NLC.
+
+ 
+
+ 9
+
+ Table of Contents
+
+ 
+
+ 
+
+On
+April 19, 2021, the Company entered into an Agreement to Purchase Provista Diagnostics, Inc. ( Agreement to Purchase ) with
+Strategic Investment Holdings, LLC ( SIH ), Ascenda BioSciences LLC ( Ascenda ) and Provista Diagnostics, Inc.
+( Provista ). Ascenda was the sole owner of the outstanding securities of Provista and SIH is the sole owner of all the outstanding
+securities of Ascenda.
+
+ 
+
+Pursuant
+to the Agreement to Purchase, the Company acquired Provista from Ascenda and SIH for an aggregate purchase price of $7.5 million consisting
+of an initial cash payment of $1.25 million, the issuance of $1.5 million in Ordinary Shares priced at $0.0512 per share, the issuance
+to SIH of a $3.5 million convertible promissory note dated April 19, 2021 (the Note ) and the payment on for before July
+1, 2021 of $1.25 million in cash (the July Payment ), which payment the Company had the right to, and did, extend to July
+15, 2021. The Provista shares acquired by the Company remained in an escrow account until the July Payment was made.
+
+ 
+
+The
+Note has a maturity date of April 8, 2025, and is convertible beginning on October 20, 2021, into Ordinary Shares of the Company at a
+conversion price equal to the lesser of $0.05 or the volume weighted average price of the last 20 trading days for the Ordinary Shares
+prior to the date of conversion. In the event SIH delivers a Notice of Conversion to the Company at a per share price less than $0.05
+($0.05), the Company has the right to immediately notify SIH of its intention to pay the conversion amount in cash within three (3) business
+days of receipt of the Notice of Conversion (i.e., before SIH would take possession of shares converted under the Notice of Conversion).
+If, at any time between October 20, 2021 and April 20, 2022, the average of the lowest bid and closing sale price at 4:00:00 p.m., New
+York time (or such other time as such market publicly announces is the official close of trading) is below ($0.05), the Company has the
+option to buy out all or any portion of the Note (the Buyback Option ). In the event the Company exercises the Buyback Option
+for an amount equal to or greater than one million, one hundred seventy thousand dollars ($1,170,000) (the Buyback Amount ),
+SIH may not submit any conversions below five cents ($0.05) for ninety (90) days from receipt of the Buyback Amount ( 90 Day Period ).
+
+ 
+
+In
+the event that the Company uplists its Ordinary Shares to a national securities exchange, the Note shall automatically be exchanged into
+ordinary shares with a conversion price equal to the lesser of (a) $0.05, (b) the opening price on the day of the uplisting provides
+there is no transaction associated with the uplisting or (c) the deal price of an uplisting transaction.
+
+ 
+
+As
+of the date of this registration statement on Form S-1, SIH has not submitted a Conversion Notice.
+
+ 
+
+During
+2021, the Company recognized approximately $12,277,000 in revenue related to its COVID-19 business, and in January and February of 2022,
+the Company recognized approximately $540,000 in such revenue. There is no assurance that the Company will generate any additional revenues
+in the future pursuant to any of these arrangements.
+
+ 
+
+Employees
+and Consultants
+
+ 
+
+During
+2021, the Company hired 23 new employees, including management and staffing of laboratory, sales and marketing and general administrative
+staffing.
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were incorporated in the State of Israel in April 2010, and are subject to the Israel Companies Law, 5760-1999 (the Companies
+Law ). Since March 7, 2017, our Ordinary Shares have been quoted on the OTCQB under the symbol TOMDF.
+
+ 
+
+In
+January 2016, we incorporated our wholly owned subsidiary, Todos (Singapore) Pte. Ltd. In March 2016, Todos (Singapore) Pte. Ltd. changed
+its name to Todos Medical Singapore Pte. Ltd., or Todos Singapore. Todos Singapore has not yet commenced its business operations.
+
+ 
+
+In
+January 2020, we incorporated Todos Medical USA, a Nevada corporation ( Todos US ), for the purpose of conducting business
+as a medical importer and distributor focused on the distribution the Company s testing products and services to customers in North
+America and Latin America. In addition, in March 2020, Todos US formed a subsidiary, Corona Diagnostics, LLC, in the State of Nevada,
+for the purpose of marketing COVID-19 related products in the United States. In July 2020, we completed the acquisition of Breakthrough
+Diagnostics, Inc, which is now a wholly owned subsidiary of Todos. In July 2021, we completed the acquisition of Provista Diagnostics,
+Inc., which is now a wholly owned subsidiary of Todos.
+
+ 
+
+ 10
+
+ Table of Contents
+
+ 
+
+ 
+
+The
+current corporate organizational structure of the Company and how we have operated substantially for the past year appears below.
+
+ 
+
+ 
+
+Additionally,
+we anticipate that 3CL Sciences Ltd. will be a 52% owned subsidiary upon the closing of the .Share Purchase Agreement with 3CL Sciences
+Ltd. ( 3CL ) and NLC Pharma Ltd. ( NLC ).
+
+ 
+
+Our
+principal executive office is located at 121 Derech Menachem Begin, 30th Floor, Tel Aviv, 6701203 Israel, and our telephone number in
+Israel is +972-52-642-0126. Our web address is www.todosmedical.com. The information contained on our website or available through our
+website is not incorporated by reference into and should not be considered a part of this prospectus, and the reference to our website
+in this prospectus is an inactive textual reference only. Puglisi & Associates is our agent in the United States, and its address
+is 850 Library Avenue, Suite 204 Newark, Delaware 19711.
+
+ 
+
+All
+per share amounts and calculations in this prospectus and the accompanying financial statements do not reflect the effects of the Reverse
+Split discussed elsewhere in this prospectus.
+
+ 
+
+ 11
+
+ Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001683131_forza_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001683131_forza_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..48974526baa076d9d4e4ab98c6040671600740df
--- /dev/null
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@@ -0,0 +1,3027 @@
+Prospectus Summary.
+
+You
+should read the following discussion and analysis of financial condition and results of operations in conjunction with the consolidated
+financial statements and related notes appearing elsewhere in this Prospectus.
+
+Overview
+
+Forza
+Innovations Inc. (, ' ': we" "our", "us", "Forza", or "the Company") a Wyoming
+corporation, was originally formed as a Florida corporation under the name Genesys Industries, Inc. On February 17, 2022, the Company
+filed Articles of Continuance with the Secretary of State for the state of Wyoming. Accordingly, the Company transferred its state of
+formation from Florida to Wyoming and became a Wyoming entity and is, now, subject to the provisions of the Wyoming Business Corporation
+Act
+
+We
+are in the health-tech wearable performance business. We have acquired the ownership and rights to certain late developmental stage products,
+including the WarmUp product line which is comprised of the J4 Sport, J4 X and J4 Fitbelt. These products are wearable back compression
+devices, used to relax, warmup, loosen, or relax stiff & sore muscles. The therapeutic application of heat causes a change in temperature
+of the soft tissues which decreases joint stiffness and relieves inflammation.
+
+We
+have recently successfully completed our first acquisition of "Sustainable Origins" which is an eco-friendly ESG company,
+that converts used cooking oil to reusable biodiesel. This acquisition is part of our ongoing strategic plan for future revenue and expansion.
+While our primary focus will always be revolving around the innovation of wearable technology, these projects will take time to market.
+We want to align ourselves with like-minded Entrepreneurs that will mesh well with the team and collective interest. Having the ability
+to acquire companies current operations to generate steady revenue streams, will also help aid in financing the production of "WarmUp"
+and other products we will develop.
+
+Results
+of Operation for the Year Ended June 30, 2021 Compared to the Year Ended June 30, 2020
+
+Revenues
+and Cost of Revenue
+
+Due
+to the termination of our CNC manufacturing and fabrication business, we did not have any revenue or cost of revenue from continuing
+operations for the years ended June 30, 2021 and 2020.
+
+Operating
+Expenses from Continuing Operations
+
+Operating
+expenses from continuing operations for the years ended June 30, 2021 and 2020, consisted of general and administrative expenses of $60,165
+and $33,255, respectively, General and administrative expenses consisted primarily of accounting and audit fees. During the year ended
+June 30, 2021, we incurred $21,200 of audit fees, $8,100 for accounting and $1,500 for legal. We also had $10,931 of depreciation and
+amortization expense and $14,437 of miscellaneous general and administrative expense. In the prior year operating expenses from continuing
+operations consisted of mostly of accounting and audit expense.
+
+ 12 
+
+ 
+
+ 
+
+Other
+Income from Continuing Operations
+
+During
+the year ended June 30, 2021, we incurred $26,033 of interest expense, $12,500 of debt discount amortization, recognized a $365,019 loss
+on the disposition of assets and liabilities and a loss of $2,704,865 on the acquisition of assets from a related party. During the year
+ended June 30, 2020, we incurred $5,484 of interest expense, $137,500 of debt discount amortization, recognized a $40,000 loss on the
+issuance of common stock and a loss of $75,000 on the issuance of convertible debt.
+
+Net
+Loss from Continuing Operations
+
+Our
+net loss from continuing operations for the years ended June 30, 2021 was $3,168,582 compared to $291,239 for the year. The large increase
+in our net loss in mainly due to the loss on asset acquisition and the loss on the disposition of the assets and liabilities.
+
+Liquidity
+and Capital Resources
+
+As
+reflected in the accompanying financial statements, the Company has an accumulated deficit of $3,494,730 at June 30, 2021, and had a
+net loss from continuing operations of $3,168,582 for year ended June 30, 2021.
+
+For
+the year ended June 30, 2021, we netted $66,297 of cash from operating activities, compared to $21,613 for the year ended June 30, 2020.
+
+Net
+cash used in investing activities for the year ended June 30, 2021 and 2020 was $110,117 and $256,227, respectively, for the purchase
+of property and equipment.
+
+Net
+cash received from financing activities for the year ended June 30, 2021 was $57,497 compared to $239,288 provided by financing activities
+in the prior period.
+
+On
+January 2, 2020, the Company executed a 10% convertible promissory note in which it agreed to borrow up to $300,000. The note is convertible
+at a price per share equal to the lower of (a) the Fixed Conversion Price (which is fixed at a
+price equal to $0.30); or (b) 80% of the lowest trading price of the Company s common stock during the 5 consecutive trading days
+prior to the date on which lender elects to convert all or part of the Note. The initial deposit of $125,000 was made on January
+15, 2020 and included a $25,000 OID. As of June 30, 2021, there is $150,000 and $40,250 of principal and interest due on this loan, respectively.
+
+On
+November 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit ("LOC") also
+recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC ("TCP"),
+an entity controlled by the Company s former sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all
+of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of November
+5, 2017. The LOC bears interest at 5% per annum and is due on demand. On January 21, 2021, TCP assigned all of its rights, title and
+interest in the debt to Front Row Seating Inc. As of June 30, 2021 the Company owes $122,729 of principal and $17,339 of accrued interest
+on the LOC.
+
+ 13 
+
+ 
+
+ 
+
+Results
+of Operation for the Three Months Ended December 31, 2021 Compared to the Three Months December 31, 2020
+
+Revenues
+and Cost of Revenue
+
+Due
+to the termination of our CNC manufacturing and fabrication business, we did not have any revenue or cost of revenue from continuing
+operations for the three months ended December 31, 2021 and 2020.
+
+Operating
+Expenses from Continuing Operations
+
+Operating
+expenses from continuing operations for the three months ended December 31, 2021 and 2020, consisted of general and administrative expenses
+("G&A") of $68,248 and $7,900, respectively. G&A expenses consisted primarily of marketing and consulting fees. During
+the three months ended December 31, 2021, we incurred approximately $73,900 of marketing fees and $15,700 for consulting expense. We
+also had $8,090 of depreciation and amortization. Our total G&A expense for the three months ended December 31, 2021 was decreased
+by a credit memo for audit fees of $41,665. We had no operating expenses from continuing operations in the prior period.
+
+Officer
+Compensation
+
+Officer
+Compensation for the six months ended December 31, 2021 and 2020, was $110,280 and $0, respectively. During the current period we made
+payments of $30,280 to our officers. We also accrued $80,000 for services provided by our CEO.
+
+Other
+Income from Continuing Operations
+
+During
+the three months ended December 31, 2021, we recognized total other expense of $208,693 compared to $12,473 for the prior period. During
+the three months ended December 31, 2021, we incurred a $298,710 loss on the issuance of convertible debt and $32,095 of debt discount
+amortization expense. This was offset by a gain of $131,052 from the change in the fair value of our derivatives related to the new convertible
+notes. We also incurred $8,940 of interest expense. For the three months ended December 31, 2020, we incurred $12,473 of interest expense.
+
+Net
+Loss from Continuing Operations
+
+Our
+net loss from continuing operations for the three months ended December 31, 2021 was $387,221 compared to $20,373 for the prior period.
+
+Results
+of Operation for the Six Months Ended December 31, 2021 Compared to the Six Months Ended December 31, 2020
+
+Revenues
+and Cost of Revenue
+
+Due
+to the termination of our CNC manufacturing and fabrication business, we did not have any revenue or cost of revenue from continuing
+operations for the six months ended December 31, 2021 and 2020.
+
+ 14 
+
+ 
+
+ 
+
+Operating
+Expenses from Continuing Operations
+
+Operating
+expenses from continuing operations for the six months ended December 31, 2021 and 2020, consisted of G&A expenses of $166,608 and
+$7,900, respectively. G&A expenses consisted primarily of accounting, audit and marketing fees. During the six months ended December
+31, 2021, we incurred $21,247 of audit fees, $6,422 for accounting and $63,900 for marketing expense. We also had $16,117 of depreciation
+and amortization and $15,700 of consulting expense. Our total G&A expense for the six months ended December 31, 2021 was decreased
+by a credit memo for audit fees of $41,665. We had no operating expenses from continuing operations in the prior period.
+
+Officer
+Compensation
+
+Officer
+Compensation for the six months ended December 31, 2021 and 2020, was $110,280 and $0, respectively. During the current period we made
+payments of $30,280 to our officers. We also accrued $80,000 for services provided by our CEO.
+
+In
+the current period we incurred an $854,550 non-cash expense for the issuance of stock options to our officers and directors.
+
+Other
+Income from Continuing Operations
+
+During
+the six months ended December 31, 2021, we recognized total other expense of $217,045 compared to $26,503 for the prior period. During
+the six months ended December 31, 2021, we incurred a $298,710 loss on the issuance of convertible debt and $32,095 of debt discount
+amortization expense. This was offset by a gain of $131,052 from the change in the fair value of our derivatives related to the new convertible
+notes. We also incurred $17,292 of interest expense. For the six months ended December 31, 2020, we incurred $14,003 of interest expense
+and $12,500 of debt discount amortization.
+
+Net
+Loss from Continuing Operations
+
+Our
+net loss from continuing operations for the six months ended December 31, 2021 was $1,348,483 compared to $34,403 for the prior period.
+
+Liquidity
+and Capital Resources
+
+As
+reflected in the accompanying financial statements, the Company has an accumulated deficit of $4,843,213 at December 31, 2021, and had
+a net loss from continuing operations of $1,348,483 for the six months ended December 31, 2021.
+
+For
+the six months ended December 31, 2021, we used $175,240 of cash in operating activities, compared to receiving $75,146 for the six months
+ended December 31, 2020.
+
+We
+neither received or used any cash in investing activities from continuing operations for the six months ended December 31, 2021 or 2020.
+
+Net
+cash received from financing activities for the six months ended December 31, 2021 was $184,525 compared to $0 provided by financing
+activities in the prior period. In the current period we received $161,500 from the issuance of convertible debt and $24,043 from the
+exercise of stock options. We also received $27,088 from our CEO, with $28,106 repaid.
+
+ 15 
+
+ 
+
+ 
+
+On
+January 2, 2020, the Company executed a 10% convertible promissory note in which it agreed to borrow up to $300,000. The note is convertible
+at a price per share equal to the lower of (a) the Fixed Conversion Price (which is fixed at a price equal to $0.30); or (b) 80% of the
+lowest trading price of the Company s common stock during the 5 consecutive trading days prior to the date on which lender elects
+to convert all or part of the Note. The initial deposit of $125,000 was made on January 15, 2020 and included a $25,000 OID. As required
+by ASC 470-20-30-6 the Company recognized and measured the embedded beneficial conversion feature at the commitment date of $200,000
+which was credited to paid in capital, a $150,000 debt discount and a $75,000 loss on the issuance of convertible debt. As of December
+31, 2021, all of the debt discount has been amortized to interest expense. On August 17, 2021, $30,000 of the note was converted into
+144,231 shares of common stock per the terms of the agreement. As of December 31, 2021, there is $120,000 and $52,499 of principal and
+interest due on this loan, respectively.
+
+On
+November 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit ("LOC") also recognized
+as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC ("TCP"),
+an entity controlled by the Company s former sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all
+of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of November
+5, 2017. The LOC bears interest at 5% per annum and is due on demand. On January 21, 2021, TCP assigned all of its rights, title and
+interest in the debt to Front Row Seating Inc. On September 28, 2021, $100,000 of the note was converted into 10,000,000 shares of common
+stock. As of December 31, 2021, the shares have not been issued and are disclosed as common stock to be issued. As of December 31, 2021,
+the Company owed $22,729 of principal and $19,232 of accrued interest.
+
+During
+the six months ended December 31, 2021, the Company issued three new convertible promissory notes. They are as follows:
+
+ 
+ Note Holder 
+ Date 
+ Maturity Date 
+ Interest Rate 
+ Balance December 31, 2021
+
+ 
+ Power Up Lending Group Ltd (1) 
+ 10/1/2021 
+ 10/1/2022 
+ 10% 
+ $55,000 
+
+ 
+ Fast Capital LLC (2) 
+ 10/26/2021 
+ 10/26/2022 
+ 10% 
+ $65,000 
+
+ 
+ Sixth Street Lending LLC (3) 
+ 11/17/2021 
+ 11/17/2022 
+ 10% 
+ $55,000 
+
+ 
+ 
+ 
+ 
+ Total 
+ $175,000 
+
+ 
+
+Conversion
+Terms
+
+(1)61%
+ of the average of the three lowest trading price for 15 days prior to conversion date.
+
+(2)61%
+ of the lowest trading price for 15 days, including conversion date.
+
+(3)61%
+ of the lowest trading price for 15 days prior to conversion date.
+
+Total
+accrued interest on the three convertible notes as of December 31, 2021 is $3,210.
+
+Off-Balance
+Sheet Arrangements
+
+None.
+
+Significant
+Accounting Policies
+
+See
+Note 2 to the June 30, 2021 financial statements included as part of this prospectus for a description of our significant accounting
+policies.
+
+ 16 
+
+ 
+
+ 
+
+Recent
+Accounting Pronouncements
+
+From
+time to time, the FASB or other standards setting bodies issue new accounting pronouncements. Updates to the FASB ASCs are communicated
+through issuance of an Accounting Standards Update ("ASU"). Unless otherwise discussed, we believe that the impact of recently
+issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on our consolidated financial
+statements upon adoption.
+
+To
+understand the impact of recently issued guidance, whether adopted or to be adopted, please review the information provided in Note 2
+to the financial statements included as part of this prospectus.
+
+DIRECTORS
+AND EXECUTIVE OFFICERS
+
+MANAGEMENT
+
+Our
+executive officers and directors are listed below. Directors are generally elected at our annual shareholders meeting and hold
+office until the next annual shareholders meeting, or until their successors are elected and qualified. Our executive officers
+are elected by our directors and serve at the board s discretion.
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Name
+ 
+ Age
+ 
+ Positions
+
+ 
+ Johnny
+ Forzani
+ 
+ 34
+ 
+ President,
+ CEO, Treasurer, CFO, Secretary and Director
+
+ 
+ Garrett
+ Morosky 
+ 
+ 28
+ 
+ Vice
+ President & Director of Joint Ventures
+
+ 
+ Tom
+ Forzani
+ 
+ 70
+ 
+ Director
+
+ 
+ Geoff
+ Stanbury
+ 
+ 70
+ 
+ Director
+
+ 
+
+The
+following is a brief summary of the background of each officer and director including their principal occupation during the five preceding
+years. Neither of these persons is a financial expert as that term is defined by the SEC. All directors will serve until their successors
+are elected and qualified or until they are removed.
+
+Johnny
+Forzani, is a former Professional Football Player and is an Entrepreneur and Inventor. Mr. Forzani played Division 1 NCAA Football
+at Washington State University, where he set an NCAA record for the longest touchdown reception. During his professional football career,
+playing with his hometown Calgary Stampeders, Mr. Forzani started creating his first invention. In 2017, Mr. Forzani s founded,
+G-Tech Apparel USA Inc. and G-Tech Apparel Canada Inc. and was issued a Utility & Design Patent from the USPTO, for G-Tech s
+Battery Powered Thermal Handwarmer.
+
+Mr.
+Forzani has been the founder of G-Tech Apparel USA Inc. and G-Tech Apparel Canada Inc since 2014. From, 2014 to 2020, Mr. Forzani acted
+as CEO and CTO of both companies. He has been our President, CEO, Treasurer, CFO, Secretary and a Director since January 21, 2022.
+
+ 17 
+
+ 
+
+ 
+
+Garrett
+Morosky, has been the President of G, LLC, a private company, from 2019 until present. From 2017 to 2019, Mr. Morosky was the VP
+of WarmUp wearables, a private company. From 2015 to 2017, Mr. Morosky was the Strategic Marketing & Advertising Consultant for Keller
+Williams Reality, Snackerz Inc., Pace & Pace Joint, IDG, WATT Companies, Curio, LA Local SEO, KrampKrusher. From 2014 to 2016 he
+was a SAG Actor and TV personality.
+
+Tom
+Forzani, is a one of three brothers to play for the Calgary Stampeders of the CFL. Described as one of the best wide receivers to
+ever play at Utah State, Mr. Forzani earned honorable mention All-America honors from The Associated Press as a senior in 1972 as he
+led the nation with receptions, while adding 1,169 receiving yards to set then-single-season school records in both categories.
+
+Following
+his Utah State career, Mr. Forzani played professionally for the Calgary Stampeders from 1972-83 and was a five-time CFL All-Star. He
+finished his CFL career ranking second all-time in Stampeders history in receptions (553), receiving yards (8,825) and receiving touchdowns
+(62). Mr. Forzani was named to Utah State's All-Century Football Team in 1993.
+
+Mr.
+Forzani began his business career towards the end of his football career, earning his realtors license in 1979. Mr. Forzani started Kelvion
+Properties in 1990, which specialized in most aspects of the Real Estate business including Land Purchase, Land Zoning, House Building,
+Land Sub Division, Mortgage Loaning and Renovations.
+
+In
+1974, Mr. Forzani was one of the Original Founders and Owners of Forzani Locker Room which became the Canadian publicly traded company
+The Forzani Group in 1993. The Forzani Group went from one store in 1974, to a retail empire encompassing more than 500 retail locations
+and over 13,000 employees. In 2011, The Forzani Group sold to Canadian conglomerate Canadian Tire Corporation for $800,000,000 (Canadian
+Dollars). Tom Forzani has been a Director since January 21, 2022.
+
+Geoff
+Stanbury, was born and raised in South West England and immigrated to North America at 19. In 1981 shortly after settling in Alberta,
+Mr. Stanbury founded his company Good Earth Environs which specializes in Land, Snow, and Erosion management. Good Earth has maintained
+contracts with some of Alberta s largest Residential companies including Brookfeild RP, for over 20 years.
+
+Today,
+Mr. Stanbury is a seasoned Investor with a portfolio ranging in both the private and public sector. Mr. Stanbury is passionate about
+entrepreneurship and innovation. He looks forward to providing veteran leadership to the board, assisting in the best way possible, on
+the path to success. Mr. Stanbury has been a Director since January 21, 2022.
+
+Employment
+Agreements
+
+We
+currently do not have any employment agreements with any of our directors or executive officers.
+
+Audit
+Committee and Audit Committee Financial Expert
+
+We
+do not currently have an audit committee or a committee performing similar functions. Our board as a whole participates in the review
+of financial statements and disclosure. We also do not have an audit committee financial expert.
+
+ 18 
+
+ 
+
+ 
+
+Compensation
+Committee Interlocks and Insider Participation
+
+None
+of our executive officers served as a member of the compensation committee or as a director of another entity one of whose executive
+officers served on our compensation committee or as one of our directors.
+
+Code
+of Ethics
+
+We
+have not adopted a Code of Business Conduct and Ethics.
+
+EXECUTIVE
+COMPENSATION
+
+The
+following Summary Compensation Table sets forth for fiscal 2021, 2020 and 2019, the compensation awarded to, paid to, or earned by our
+executive officers.
+
+ 
+ Name and Principal Position 
+ Year 
+ Salary 
+ ($) 
+ Bonus 
+ ($) 
+ Option Awards 
+ ($) 
+ Non-equity 
+ incentive plan compensation 
+ ($) 
+ Change in pension value and nonqualified deferred compensation earnings 
+ ($) 
+ All Other Compensation 
+ ($) 
+ Total 
+ ($)
+
+ 
+ Johnny Forzani 
+ 2021 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ CEO, CFO, Director 
+ 2020 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ 
+ 2019 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ Garrett Morosky 
+ 2022 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ VP & Director of 
+ 2020 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ Joint Ventures 
+ 2019 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ Tom Forzani 
+ 2022 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ Director 
+ 2020 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ 
+ 2019 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ Geoff Stanbury 
+ 2022 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ Director 
+ 2020 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+ 
+ 2019 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+
+ 
+
+Stock
+Incentive Plans
+
+We
+have one Stock Incentive Plan. The terms and conditions of any stock issued and the terms and conditions of any options granted,
+including the price of the shares of common stock issuable on the exercise of options, are governed by the provisions of the Plans and
+any agreements with the Plan participants.
+
+ 19 
+
+ 
+
+ 
+
+On
+July 21, 2021, we adopted our 2021 Equity Award Plan. On August 3, 2021 we granted options to the persons shown below pursuant to this
+plan.
+
+ 
+ Name 
+ Shares issuable Upon Exercise of Option 
+ Option Exercise Price 
+ Expiration Date
+
+ 
+ Johnny Forzani 
+ 1,000,000 
+ $0.05 
+ 8/3/2023
+
+ 
+ Tom Forzani 
+ 250,000 
+ $0.05 
+ 8/3/2023
+
+ 
+ Geoff Stanbury 
+ 250,000 
+ $0.05 
+ 8/3/2023
+
+ 
+
+Employee
+Pension, Profit Sharing or other Retirement Plans
+
+We
+do not have a defined benefit, pension plan, profit sharing or other retirement plan, although we may adopt one or more of such plans
+in the future.
+
+Compensation
+of Directors
+
+During
+the fiscal year ended June 30, 2021 we did not compensate our directors for acting as such.
+
+Transactions
+with Related Parties
+
+On
+January 21, 2021, we entered into an acquisition agreement with Johnny Forzani to acquire all of the ownership and the rights to certain
+late developmental stage products, including the J4 Sport, J4 X and J4 Fitbelt in exchange for the issuance of 10,000,000 common shares.
+The shares were valued at $0.28, the closing stock price on the date of the agreement, for a total value of $2,800,000. The assets were
+valued at cost of $95,135, resulting in a loss on asset acquisition of $2,704,865. As a result of this acquisition, we moved out of the
+precision CNC manufacturing and fabrication business and moving into the health-tech wearable performance business.
+
+During
+the year ended June 30, 2021, Mr. Forzani advanced the Company $54,833, for general operating expenses, the advance is non-interest bearing
+and due on demand.
+
+PRINCIPAL
+SHAREHOLDERS 
+
+The
+following table shows the ownership of our common stock and Series A preferred shares as of the date of this prospectus, by (i) each
+person whom we know beneficially owns more than 5% of the outstanding shares of our common stock or preferred shares; (ii) each of our
+executive officers; (iii) each of our directors; and (iv) all of our executive officers and directors as a group. Unless otherwise indicated,
+to our knowledge each of the stockholders listed below has sole voting and investment power over the shares beneficially owned. Unless
+otherwise specified, the address of each of the persons set forth below is in care of Forza at 406 9th Avenue, Suite 210, San Diego,
+California 92101.
+
+ 20 
+
+ 
+
+ 
+
+ 
+ 
+ Number of Shares 
+ Percentage
+
+ 
+ Name 
+ Owned 
+ of Class(4)
+
+ 
+ Johnny Forzani 
+ 270,969,007(1) 
+ 90.49%
+
+ 
+ Tom Forzani 
+ 250,000(2) 
+ (5)
+
+ 
+ Geoff Stanbury 
+ 250,000(3) 
+ (5)
+
+ 
+ All executive officers and directors as a group (five persons) 
+ 271,469,007 
+ 90.66%
+
+ 
+
+1
+Includes 600,000 shares underlying currently exercisable stock options held by Johnny Forzani.
+
+2
+Comprised solely of shares underlying currently exercisable stock options held by Tom Forzani.
+
+3
+Comprised solely of shares underlying currently exercisable stock options held by Geoff Stanbury.
+
+4
+Calculated based on all outstanding shares plus all currently exercisable stock options as of March 29, 2022.
+
+4
+Less than 1 percent.
+
+EQUITY
+PURCHASE AGREEMENT
+
+On
+January 20, 2022, we entered into an Equity Purchase Agreement with Mast Hill in order to establish a possible source of funding for
+our operations.
+
+Under
+the Equity Purchase Agreement Mast Hill has agreed to provide us with up to $5,000,000 of funding during the period ending: (1) on the
+date which is 24 months after the date we signed the Equity Purchase Agreement; (2) written notice of termination by the Company to the
+Investor (which shall not occur during any Valuation Period or at any time that the Investor holds any of the Put Shares); (3) this Registration
+Statement is no longer effective after the initial effective date of the Registration Statement; or (4) the date that, pursuant to or
+within the meaning of any Bankruptcy Law, we commence a voluntary case or any Person commences a proceeding against us, a Custodian is
+appointed for us or for all or substantially all of our property or we make a general assignment for the benefit of our creditors.
+
+We
+may, in our sole discretion, deliver a Put Notice to Mast Hill. The Put Notice will specify the number of shares of common stock which
+we intend to sell to Mast Hill on a closing date.
+
+The
+minimum amount we can raise at any one time is $15,000, and the maximum amount we can raise at any one time is the lesser of (a) $500,000.00
+or (b) 175% of the Average Daily Trading Value of our common stock.
+
+The
+number of shares to be sold by Mast Hill in this offering will vary from time-to-time and will depend upon the number of shares purchased
+from us pursuant to the terms of the Equity Purchase Agreement. However, 5,000,000 shares of common stock is the maximum number
+of shares which we may sell to Mast Hill pursuant to this Prospectus.
+
+For
+purposes of the foregoing:
+
+Purchase
+Price means 90% of the Market Price on such date on which the Purchase Price is calculated in accordance with the terms and conditions
+of this Agreement.
+
+Market
+Price means the average of the two lowest volume weighted average prices of the Company s Common Stock on the Principal Market
+during the Valuation Period, in each case as reported by Quotestream or other reputable source designated by the Investor.
+
+ 21 
+
+ 
+
+ 
+
+Valuation
+Period means the period of seven Trading Days immediately following the Clearing Date associated with the applicable Put Notice during
+which the Purchase Price of the Common Stock is valued. The Valuation Period shall begin on the first Trading Day following the Clearing
+Date.
+
+Trading
+Day means a day on which the Principal Market shall be open for business.
+
+Clearing
+Date is the date on which the Investor receives the Put Shares in its brokerage account.
+
+Principal
+Market means any of the national exchanges (i.e. NYSE, NYSE AMEX, and Nasdaq), or principal quotation systems (i.e. OTCQX, OTCQB, and
+OTC Pink), or other principal exchange or recognized quotation system which is at the time the principal trading platform or market for
+the Common Stock.
+
+The
+number of shares to be sold by Mast Hill in this offering will vary from time-to-time and will depend upon the number of shares purchased
+from us pursuant to the terms of the Equity Purchase Agreement.
+
+We
+are under no obligation to sell any shares under the equity line of credit and we may terminate the Equity Purchase Agreement at any
+time by written notice to Mast Hill, except during any Valuation Period or at any time that the Investor holds any of the Put Shares.
+In addition, this Agreement shall automatically terminate at the end of the Commitment Period.
+
+We
+will not receive any proceeds from the sale of the shares by Mast Hill. Mast Hill may resell the shares it acquires by means of this
+prospectus from time to time in the public market. We are paying the costs of registering the shares offered by Mast Hill. Mast Hill
+will pay all other costs of the sale of the shares which it may purchase from us. During the past three years neither Mast Hill nor its
+controlling persons had any relationship with us, or our officers or directors.
+
+The shares of common stock owned, or which may be acquired by Mast Hill, may be offered and sold by means of this prospectus from time
+to time as market conditions permit in the over-the-counter market, or otherwise, at prices and terms then prevailing or at prices related
+to the then-current market price, or in negotiated transactions. These shares may be sold by one or more of the following methods, without
+limitation:
+
+ a
+ block trade in which a broker or dealer so engaged will attempt to sell the shares as agent
+ but may position and resell a portion of the block as principal to facilitate the transaction;
+
+ purchases
+ by a broker or dealer as principal and resale by such broker or dealer for its account pursuant
+ to this prospectus;
+
+ ordinary
+ brokerage transactions and transactions in which the broker solicits purchasers; and
+
+ face-to-face
+ transactions between sellers and purchasers without a broker/dealer.
+
+In
+competing sales, brokers or dealers engaged by Mast Hill may arrange for other brokers or dealers to participate. These brokers or dealers
+may receive commissions or discounts from Mast Hill in amounts to be negotiated.
+
+Mast
+Hill is an "underwriter" and any broker/dealers who act in connection with the sale of the shares by means of this prospectus
+may be deemed to be "underwriters" within the meaning of the Securities Acts of 1933, and any commissions received by them
+and profit on any resale of the shares as principal might be deemed to be underwriting discounts and commissions under the Securities
+Act. We haves agreed to indemnify Mast Hill against certain liabilities, including liabilities under the Securities Act as underwriters
+or otherwise.
+
+ 22 
+
+ 
+
+ 
+
+We
+have advised Mast Hill that it and any securities broker/dealers or others who may be deemed to be statutory underwriters will be subject
+to the prospectus delivery requirements under the Securities Act of 1933. We have also advised Mast Hill that, in the event of a "distribution"
+of its shares, Mast Hill, any "affiliated purchasers", and any broker/dealer or other person who participates in such distribution,
+may be subject to Rule 102 of Regulation M under the Securities Exchange Act of 1934 until their participation in that distribution is
+completed. Rule 102 makes it unlawful for any person who is participating in a distribution to bid for or purchase stock of the same
+class as is the subject of the distribution. A "distribution" is defined in Regulation M as an offering of securities "that
+is distinguished from ordinary trading transactions by the magnitude of the offering and the presence of special selling efforts and
+selling methods". We have also advised Mast Hill that Regulation M prohibits any "stabilizing bid" or "stabilizing
+purchase" for the purpose of pegging, fixing or stabilizing the price of the common stock in connection with this offering.
+
+We
+granted registration rights to Mast Hill to enable it to sell the common stock it may acquire under the Equity Purchase Agreement. Notwithstanding
+these registration rights, we have no obligation:
+
+ to
+ assist or cooperate with Mast Hill in the offering or disposition of their shares; or
+
+ to
+ obtain a commitment from an underwriter relative to the sale of any the shares.
+
+Mast
+Hill is entitled to customary indemnification from us for any losses or liabilities it suffers based upon material misstatements or omissions
+from the registration statement or this prospectus, except as they relate to information Mast Hill supplied to us for inclusion in the
+registration statement and prospectus.
+
+We
+will prepare and file amendments and supplements to this prospectus as may be necessary in order to keep this prospectus effective as
+long as Mast Hill holds shares of our common stock or until these shares can be sold under an appropriate exemption from registration.
+We have agreed to bear the expenses of registering the shares, but not the expenses associated with selling the shares, such as broker
+discounts and commissions.
+
+As
+the date of this prospectus Mast Hill owns 2,500,000 shares of our common stock. During the course of this offering Mast Hill may acquire
+up to an additional 5,000,000 shares of our common stock. It is not known how many shares of our common stock Mast Hill will own after
+this offering. Patrick Hassani is the controlling person of Mast Hill.
+
+Mast
+Hill s obligations under the equity line are not transferable.
+
+ 23 
+
+ 
+
+ 
+
+ 
+
+DESCRIPTION
+OF SECURITIES
+
+Common
+Stock
+
+We
+are authorized to issue 700,000,000 shares of common stock. Holders of our common stock are each entitled to cast one vote for each share
+held of record on all matters presented to the shareholders. Cumulative voting is not allowed; hence, the holders of a majority of our
+outstanding common shares can elect all directors.
+
+Holders
+of our common stock are entitled to receive such dividends as may be declared by our Board of Directors out of funds legally available
+and, in the event of liquidation, to share pro rata in any distribution of our assets after payment of liabilities. Our Board of Directors
+is not obligated to declare a dividend. It is not anticipated that dividends will be paid in the foreseeable future.
+
+Holders
+of our common stock do not have pre-emptive rights to subscribe to additional shares if issued. There are no conversion, redemption,
+sinking fund or similar provisions regarding the common stock. All outstanding shares of common stock are fully paid and non-assessable.
+
+Preferred
+Stock
+
+We
+are authorized to issue 25,000,000 shares of preferred stock. The Preferred Stock constitutes a convertible stock in which one Preferred
+Share is convertible into five Common Shares. The Preferred Stockholders are entitled to vote on any matters on which the common stock
+holders are entitled to vote
+
+Warrants
+and Options
+
+Information
+concerning our outstanding warrants and options is shown below:
+
+ 
+ 
+ 
+ Shares
+ Issuable
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Upon
+ Exercise
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ of
+ Warrant
+ 
+ Exercise
+ 
+ 
+
+ 
+ Holder
+ 
+ or
+ Option
+ 
+ Price
+ 
+ Expiration
+ Date
+
+ 
+ Officers
+ and Directors
+ 
+ (1)
+ 
+ (1)
+ 
+ (1)
+
+ 
+
+(1)
+See "Management – Outstanding Equity Awards" for information concerning options held by our officers and directors.
+
+Transfer
+Agent
+
+ClearTrust,
+LLC
+
+16540
+Pointe Village Dr., Ste 205
+
+Lutz,
+Florida 33558
+
+Telephone:
+(813) 235-4490
+
+ 
+
+LEGAL
+PROCEEDINGS 
+
+We
+are not involved in any legal proceedings and we do not know of any legal proceedings which are threatened or contemplated. 
+
+ 24 
+
+ 
+
+ 
+
+INDEMNIFICATION
+
+Our
+Bylaws authorize indemnification of a director, officer, employee or agent against expenses incurred by him in connection with any action,
+suit, or proceeding to which he is named a party by reason of his having acted or served in such capacity, except for liabilities arising
+from his own misconduct or negligence in performance of his duty. In addition, even a director, officer, employee, or agent found liable
+for misconduct or negligence in the performance of his duty may obtain such indemnification if, in view of all the circumstances in the
+case, a court of competent jurisdiction determines such person is fairly and reasonably entitled to indemnification. Insofar as indemnification
+for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers, or controlling persons pursuant
+to these provisions, we have been informed that in the opinion of the Securities and Exchange Commission, such indemnification is against
+public policy as expressed in the Act and is therefore unenforceable.
+
+SELLING
+STOCKHOLDERS
+
+This
+Prospectus relates to the possible resale from time to time by the Selling Stockholders named in the table below of any or all of the
+Common Stock that has been or may be issued by us to the Selling Stockholders under the Equity Purchase Agreement and the Security Purchase
+Agreements. We are registering the Common Stock pursuant to the provisions of the Registration Rights Agreement entered into with Mast
+Hill in order to permit Mast Hill to offer its shares for resale from time to time.
+
+The
+table below presents information regarding the Selling Stockholders and the Common Stock they may offer from time to time under this
+Prospectus. This table is prepared based on information supplied to us by the Selling Stockholders and reflects holdings as of March
+29, 2022. As used in this Prospectus, the term "Selling Stockholders" includes each Selling Stockholder, and any donees,
+pledgees, transferees, or other successors-in-interest selling shares received after the date of this Prospectus from such Selling Stockholder
+as a gift, pledge, or other non-sale related transfer. The number of shares in the column "Maximum Number of Common Stock to be
+Offered Pursuant to this Prospectus" represents all of the Common Stock that each Selling Stockholder may offer under this Prospectus.
+Each Selling Stockholder may sell some, all or none of its shares offered by this Prospectus. We do not know how long any Selling Stockholder
+will hold its shares before selling them, and we currently have no agreements, arrangements, or understandings with the Selling Stockholders
+regarding the sale of any of the shares.
+
+Beneficial
+ownership is determined in accordance with Rule 13d-3(d) promulgated by the SEC under the Exchange Act and includes Common Stock with
+respect to which the Selling Stockholder has voting and investment power. With respect to the Equity Line with the Selling Stockholder,
+because the purchase price of the Common Stock issuable under the Equity Purchase Agreement is determined on each settlement date, the
+number of shares that may actually be sold by us under the Equity Purchase Agreement may be fewer than the number of shares being offered
+by this Prospectus. The fourth column assumes the sale of all of the shares offered by the Selling Stockholders pursuant to this Prospectus. 
+
+ 
+ Name of Selling Stockholders 
+ Number of
+ Shares Owned
+ Prior to
+ Offering 
+ Maximum
+ Number of
+ Shares to be
+ Offered for Resale Pursuant
+ to this
+ Prospectus 
+ 
+Number of Shares Beneficially Owned
+ After
+ Offering(3) 
+ Percent of the Class to be Owned After Offering(3)
+
+ 
+ Mast Hill Fund LP 
+ 2,500,000 
+ 12,050,000(1) 
+ 0 
+ 0 
+
+ 
+ J.H. Darbie & Co., Inc. 
+ 139,628(2) 
+ 139,628(2) 
+ 0 
+ 0 
+
+ 
+
+ 
+
+ 
+ (1)
+ 
+ In
+ addition to the 2,500,000 shares it already owns, this number represents (a) 5,000,000 common shares offered for resale by Mast Hill,
+ which shares are issuable by the Company pursuant to the EPA; (b) 3,500,000 common shares issuable upon conversion of a convertible
+ promissory note previously issued to Mast Hill; (c) common shares issuable upon exercise pursuant to the common stock purchase warrant
+ for the purchase of 700,000 shares of our common stock issued to Mast Hill; and, (d) common shares issuable upon exercise pursuant
+ to the common stock purchase warrant for the purchase of 700,000 shares of our common stock issued to Mast Hill.
+
+ 
+ 
+ 
+
+ 
+ (2)
+ Represents
+ common shares issuable upon exercise pursuant to the common stock purchase warrant for the purchase of 139,628 shares of our common
+ stock issued to J.H. Darbie & Co., Inc.
+
+ 
+ 
+ 
+
+ 
+ (3)
+ Assumes
+ the sale of all shares being offered pursuant to this prospectus.
+
+ 
+
+ 25 
+
+ 
+
+ 
+
+PLAN
+OF DISTRIBUTION
+
+The
+Selling Stockholders, including any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of
+their securities covered hereby on the OTC Pink or any other stock exchange, market or trading facility on which the securities are traded
+or in private transactions. These sales may be at market prices prevailing at the time of sale, prices related to prevailing market prices,
+fixed prices or negotiated prices. The Selling Stockholders may use any one or more of the following methods when selling securities:
+
+ ordinary brokerage
+transactions and transactions in which the broker-dealer solicits purchasers;
+
+ block trades in
+which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal
+to facilitate the transaction;
+
+ purchases by a
+broker-dealer as principal and resale by the broker-dealer for its account;
+
+ exchange distributions
+in accordance with the rules of the applicable exchange;
+
+ privately negotiated
+transactions;
+
+ settlements of
+short sales;
+
+ transactions through
+broker-dealers that agree with the Selling Stockholders to sell a specified number of such securities at a stipulated price per security;
+
+ writings or settlements
+of options or other hedging transactions, whether through an options exchange or otherwise;
+
+ combinations of
+any such methods of sale; or
+
+ any other methods
+permitted pursuant to applicable law.
+
+Broker-dealers
+engaged by the Selling Stockholders may arrange for other broker-dealers to participate in sales. Broker-dealers may receive commissions
+or discounts from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser)
+in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in
+excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a markup or
+markdown in compliance with FINRA IM-2440. 
+
+In
+connection with the sale of the securities or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers
+or other financial institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they
+assume. The Selling Stockholders may also enter into option or other transactions with broker-dealers or other financial institutions
+or create one or more derivative securities which require the delivery to such broker-dealer or other financial institution of securities
+offered by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this Prospectus
+(as supplemented or amended to reflect such transaction). 
+
+The
+Selling Stockholders and any broker-dealers or agents that are involved in selling the securities will be deemed to be "underwriters"
+within the meaning of Section 2(a)(11) of the Securities Act in connection with such sales. In such event, any commissions received by
+such broker-dealers or agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions
+or discounts under the Securities Act. The Selling Stockholders have informed the Company that it does not have any written or oral agreement
+or understanding, directly or indirectly, with any person to distribute the securities.
+
+ 26 
+
+ 
+
+ 
+
+The
+Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the securities. The Company
+has agreed to indemnify the Selling Stockholders against certain losses, claims, damages and liabilities, including liabilities under
+the Securities Act.
+
+Because
+the Selling Stockholders may be deemed to be an "underwriter" within the meaning of the Securities Act, they will be subject
+to the prospectus delivery requirements of the Securities Act including Rule 172 thereunder. In addition, any securities covered by this
+prospectus which qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than under this prospectus.
+The Selling Stockholders have advised us that there is no underwriter or coordinating broker acting in connection with the proposed sale
+of the resale securities by the Selling Stockholders.
+
+We
+have agreed to keep this prospectus effective until the earlier of (i) the date on which the securities may be resold by the Selling
+Stockholders without registration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement
+for the Company to be in compliance with the current public information under Rule 144 under the Securities Act or any other rule of
+similar effect or (ii) the sale of all of the securities pursuant to this prospectus or Rule 144 under the Securities Act or any other
+rule of similar effect. The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable
+state securities laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered
+or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is
+complied with.
+
+Pursuant
+to applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously
+engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M,
+prior to the commencement of the distribution. In addition, the Selling Stockholders will be subject to applicable provisions of the
+Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of securities
+of the common stock by the Selling Stockholders or any other person. We will make copies of this prospectus available to the Selling
+Stockholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the
+sale (including by compliance with Rule 172 under the Securities Act.
+
+SHARES
+ELIGIBLE FOR FUTURE SALE
+
+We
+cannot predict the effect, if any, that market sales of shares of our common stock or the availability of shares of our common stock
+for sale will have on the market price of our common stock prevailing from time to time. Future sales of our common stock in the public
+market, or the availability of such shares for sale in the public market, could adversely affect market prices prevailing from time to
+time. The availability for sale of a substantial number of shares of our common stock including Put Shares acquired upon exercise of
+our rights pursuant to the Equity Credit Line and upon exercise of rights under the Convertible Notes and Warrants issued to Selling
+Stockholders and such other convertible notes, options and warrants as may be outstanding from time to time could materially adversely
+affect the market price of our common stock. In addition, sales of our common stock in the public market after the restrictions lapse
+as described below, or the perception that those sales may occur, could cause the prevailing market price to decrease or to be lower
+than it might be in the absence of those sales or perceptions.
+
+ 27 
+
+ 
+
+ 
+
+Sale
+of Restricted Shares
+
+The 12,189,628
+shares of common stock being offered by this Prospectus, other than any of such shares which are acquired by our "affiliates,"
+as defined in Rule 144, will be freely tradable without restriction or registration under the Securities Act. As of March 29, 2022, there
+were 298,449,961 shares of common stock outstanding without giving effect to 50,000,000 shares issuable upon conversion of outstanding
+shares of our Series A Preferred. Other than the 270,969,007 shares owned by our affiliates or any shares of during the past 6 months,
+the other shares will be either freely tradeable or eligible for sale pursuant to Rule 144.
+
+Rule
+144
+
+In
+general, under Rule 144, as currently in effect, a person who is not and has not been our affiliate at any time during the preceding
+three months, and who has beneficially owned his shares for at least six months, including the holding period of any prior owner other
+than one of our affiliates, would be entitled to sell an unlimited number of shares of our common stock provided current public information
+about us is available, and, after owning such shares for at least one year, including the holding period of any prior owner other than
+one of our affiliates, would be entitled to sell an unlimited number of shares of our common stock without restriction. A person who
+is our affiliate or who was our affiliate at any time during the preceding three months (or persons whose shares are required to be aggregated),
+including a person who may be deemed an "affiliate" of a company, who has beneficially owned restricted securities for at
+least six months may sell, within any three-month period, a number of shares that does not exceed the greater of: (1) 1% of the then-outstanding
+shares of common stock, or (2) if and when the common stock is listed on a national securities exchange, the average weekly trading volume
+of the common stock during the four calendar weeks preceding the date on which a notice of such sale was filed under Rule 144. Sales
+under Rule 144 by our affiliates are also subject to certain requirements as to the manner of sale, notice, and availability of current
+public information about our company.
+
+We
+cannot estimate the number of shares of our common stock that our existing stockholders will elect to sell under Rule 144.
+
+LEGAL
+MATTERS
+
+The
+legality of the securities offered by this prospectus will be passed upon for us by Jackson L. Morris, 126 21st Avenue Southeast, St.
+Petersburg, Florida 33705.
+
+EXPERTS
+
+Our
+balance sheets as of June 30, 2021 and June 30, 2020 and the related statement of operations, changes in stockholders equity and
+cash flows for the years ended June 30, 2021 and June 30, 2020 included in this prospectus have been audited by BF Borgers CPA PC, independent
+registered public accounting firm, as indicated in their report with respect thereto, and have been so included in reliance upon the
+report of such firm given on their authority as experts in accounting and auditing.
+
+DISCLOSURE
+OF COMMISSION S POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
+
+Insofar
+as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers and controlling
+persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification
+is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification
+against such liabilities (other than the payment by us of expenses incurred or paid by one of our directors, officers or controlling
+persons in the successful defense of any action, suit or proceeding) is asserted by that director, officer or controlling person in connection
+with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent,
+submit to a court of appropriate jurisdiction the question whether that indemnification by us is against public policy as expressed in
+the Securities Act and will be governed by the final adjudication of that issue.
+
+ 28 
+
+ 
+
+ 
+
+WHERE
+YOU CAN FIND ADDITIONAL INFORMATION
+
+We
+have filed with the Securities and Exchange Commission a Registration Statement on Form S-1 (together with all amendments and exhibits)
+under the Securities Act of 1933, as amended, with respect to the securities offered by this prospectus. This prospectus does not contain
+all of the information in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations
+of the Securities and Exchange Commission. For further information, reference is made to the Registration Statement which may be read
+and copied at the Commission s Public Reference Room.
+
+We
+are subject to the requirements of the Securities Exchange Act of 1934 and are required to file reports and other information with the
+Securities and Exchange Commission. Copies of any such reports and other information (which includes our financial statements) filed
+by us can be read and copied at the Commission's Public Reference Room.
+
+The
+public may obtain information on the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330. The Public Reference
+Room is located at 100 F. Street, N.E., Washington, D.C. 20549.
+
+Our
+Registration Statement and all reports and other information we file with the Securities and Exchange Commission are available at www.sec.gov,
+the website of the Securities and Exchange Commission.
+
+ 29 
+
+ 
+
+ 
+
+FORZA
+INNOVATIONS, INC.
+
+INDEX
+TO CONSOLIDATED FINANCIAL STATEMENTS
+
+JUNE
+30, 2021
+
+ 
+
+ 
+ Report
+ of Independent Registered Public Accounting Firm
+ F-1 
+
+ 
+ Report
+ of Previous Independent Registered Public Accounting Firm
+ F-2 
+
+ 
+ Consolidated
+ Balance Sheets as of June 30, 2021 and 2020 
+ F-3 
+
+ 
+ Consolidated
+ Statements of Operations for the Years Ended June 30, 2021 and 2020
+ F-4 
+
+ 
+ Consolidated
+ Statement of Stockholders Equity (Deficit) for the Years Ended June 30, 2021 and 2020
+ F-5 
+
+ 
+ Consolidated
+ Statements of Cash Flows for the Years Ended June 30, 2021 and 2020
+ F-6 
+
+ 
+ Notes
+ to the Consolidated Financial Statements
+ F-7 
+
+ 
+
+ 
+
+ 30 
+
+ 
+
+ 
+
+ 
+
+Report
+of Independent Registered Public Accounting Firm
+
+To
+the shareholders and the board of directors of Forza Innovations, Inc.
+
+Opinion
+on the Financial Statements
+
+We
+have audited the accompanying balance sheet of Forza Innovations, Inc. (the "Company") as of June 30, 2021, the related statement
+of operations, stockholders' equity (deficit), and cash flows for the year then ended, and the related notes (collectively referred to
+as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial
+position of the Company as of June 30, 2021, and the results of its operations and its cash flows for the year then ended, in conformity
+with accounting principles generally accepted in the United States.
+
+Substantial
+Doubt about the Company s Ability to Continue as a Going Concern
+
+The
+accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note
+3 to the financial statements, the Company s significant operating losses raise substantial doubt about its ability to continue
+as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
+
+Basis
+for Opinion
+
+These
+financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's
+financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board
+(United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal
+securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+
+We
+conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
+reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
+is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits
+we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion
+on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion.
+
+Our
+audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or
+fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
+the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant
+estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides
+a reasonable basis for our opinion.
+
+/s/
+BF Borgers CPA PC
+
+BF
+Borgers CPA PC
+
+We
+have served as the Company's auditor since 2022
+
+Lakewood,
+CO
+
+October
+8, 2022
+
+ F-1 
+
+ 
+
+ 
+
+MICHAEL
+GILLESPIE & ASSOCIATES, PLLC
+
+CERTIFIED
+PUBLIC ACCOUNTANTS
+
+10544
+ALTON AVE NE
+
+SEATTLE,
+WA 98125
+
+206.353.5736
+
+ 
+
+REPORT
+OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 
+
+To
+the Shareholders & Board of Directors
+
+Genesys
+Industries, Inc.
+
+ 
+
+Opinion
+on the Financial Statements
+
+We
+have audited the accompanying balance sheet of Genesys Industries, Inc. as of June 30, 2020 and the related statements of operations,
+changes in stockholders deficit, cash flows, and the related notes (collectively referred to as "financial statements")
+for the period ended June 30, 2020. In our opinion, the financial statements present fairly, in all material respects, the financial
+position of the Company as of June 30, 2020 and the results of its operations and its cash flows for the periods then ended in conformity
+with accounting principles generally accepted in the United States of America.
+
+Going
+Concern
+
+The
+accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note #3 to
+the financial statements, although the Company has limited operations it has yet to attain profitability. This raises substantial doubt
+about its ability to continue as a going concern. Management s plan in regard to these matters is also described in Note #3. The
+financial statements do not include any adjustments that might result from the outcome of this uncertainty.
+
+Basis
+for Opinion
+
+These
+financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on the Company s
+financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board
+(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities
+laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+
+We
+conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
+reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
+is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit,
+we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion
+on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion.
+
+Our
+audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or
+fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
+the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant
+estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides
+a reasonable basis for our opinion.
+
+/S/
+MICHAEL GILLESPIE & ASSOCIATES, PLLC
+
+We
+have served as the Company s auditor since 2016.
+
+ 
+
+Seattle,
+Washington
+
+April
+26, 2022
+
+ 
+
+ F-2 
+
+ 
+
+ 
+
+ 
+ FORZA INNOVATIONS INC.
+ (formerly Genesys Industries, Inc)
+ BALANCE SHEETS
+
+ 
+ 
+
+ 
+ 
+ June 30, 2021 
+ June 30, 2020 
+
+ 
+ ASSETS 
+ 
+ 
+
+ 
+ Current assets: 
+ 
+ 
+
+ 
+ Cash 
+ $13,677 
+ $— 
+
+ 
+ Assets of discontinued operations 
+ — 
+ 261,254 
+
+ 
+ Total current assets 
+ 13,677 
+ 261,254 
+
+ 
+ 
+ 
+ 
+
+ 
+ Machinery and equipment, net 
+ 108,954 
+ — 
+
+ 
+ Website, net 
+ 15,250 
+ — 
+
+ 
+ Assets of discontinued operations 
+ — 
+ 586,984 
+
+ 
+ Total Assets 
+ $137,881 
+ $848,238 
+
+ 
+ 
+ 
+ 
+
+ 
+ LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) 
+ 
+ 
+
+ 
+ Current liabilities: 
+ 
+ 
+
+ 
+ Accounts payable 
+ $35,400 
+ $— 
+
+ 
+ Accrued interest 
+ 57,649 
+ 15,000 
+
+ 
+ Convertible note payable, net of discount of $0 and $12,500, respectively 
+ 150,000 
+ 137,500 
+
+ 
+ Loan Payable 
+ 122,729 
+ — 
+
+ 
+ Due to related party 
+ 54,833 
+ — 
+
+ 
+ Liabilities of discontinued operations 
+ — 
+ 274,348 
+
+ 
+ Total current liabilities 
+ 420,611 
+ 426,848 
+
+ 
+ Long term liabilities: 
+ 
+ 
+
+ 
+ Liabilities of discontinued operations 
+ — 
+ 360,980 
+
+ 
+ Total liabilities 
+ 420,611 
+ 787,828 
+
+ 
+ 
+ 
+ 
+
+ 
+ Commitments and contingencies 
+ — 
+ — 
+
+ 
+ 
+ 
+ 
+
+ 
+ Stockholders' equity (deficit): 
+ 
+ 
+
+ 
+ Class B Preferred stock, $0.001 par value, 25,000,000 shares authorized, 10,000,000 and 10,000,000 issued and outstanding, respectively 
+ 10,000 
+ 10,000 
+
+ 
+ Common stock, $0.001 par value, 100,000,000 shares authorized; 28,100,000 and 18,100,000 shares issued and outstanding, respectively 
+ 28,100 
+ 18,100 
+
+ 
+ Additional paid-in capital 
+ 3,173,900 
+ 383,900 
+
+ 
+ Accumulated deficit 
+ (3,494,730) 
+ (351,590)
+
+ 
+ Total stockholders' (deficit) equity 
+ (282,730) 
+ 60,410 
+
+ 
+ Total Liabilities and Stockholders' Equity 
+ $137,881 
+ $848,238 
+
+ 
+
+The
+accompanying notes are an integral part of these financial statements.
+
+ F-3 
+
+ 
+
+ 
+
+ 
+ FORZA INNOVATIONS INC.
+ (formerly Genesys Industries, Inc)
+ STATEMENTS OF OPERATIONS
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ For the Years Ended June 30,
+
+ 
+ 
+ 2022 
+ 2020
+
+ 
+ Operating Expenses: 
+ 
+ 
+
+ 
+ General & administrative expenses 
+ $60,165 
+ $33,255 
+
+ 
+ Total operating expenses 
+ 60,165 
+ 33,255 
+
+ 
+ 
+ 
+ 
+
+ 
+ Loss from operations 
+ (60,165) 
+ (33,255)
+
+ 
+ 
+ 
+ 
+
+ 
+ Other expense: 
+ 
+ 
+
+ 
+ Interest expense 
+ (26,033) 
+ (5,484)
+
+ 
+ Debt discount amortization 
+ (12,500) 
+ (137,500)
+
+ 
+ Loss on issuance of common stock 
+ — 
+ (40,000)
+
+ 
+ Loss on issuance of convertible debt 
+ — 
+ (75,000)
+
+ 
+ Loss on asset acquisition – related party 
+ (2,704,865) 
+ — 
+
+ 
+ Loss on disposition of assets and liabilities 
+ (365,019) 
+ — 
+
+ 
+ Total other expense 
+ (3,108,417) 
+ (257,984)
+
+ 
+ 
+ 
+ 
+
+ 
+ Loss before income taxes 
+ (3,168,582) 
+ (291,239)
+
+ 
+ 
+ 
+ 
+
+ 
+ Provision for income taxes 
+ — 
+ — 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net loss from continuing operations 
+ (3,168,582) 
+ (291,239)
+
+ 
+ Net income (loss) from discontinued operations 
+ 25,442 
+ (29,769)
+
+ 
+ Net Loss 
+ $(3,143,140) 
+ $(321,008)
+
+ 
+ 
+ 
+ 
+
+ 
+ Net loss per common share, basic & diluted from continuing operations 
+ $(0.14) 
+ $(0.02)
+
+ 
+ Net income (loss) per common share, basic & diluted from discontinued operations 
+ $0.00 
+ $(0.00)
+
+ 
+ Net Loss Per Common Share, basic & diluted 
+ $(0.14) 
+ $(0.02)
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted Common Shares Outstanding, basic & diluted 
+ 23,031,507 
+ 18,033,808 
+
+ 
+
+The
+accompanying notes are an integral part of these financial statements.
+
+ F-4 
+
+ 
+
+ 
+
+ 
+
+ 
+ FORZA INNOVATIONS INC.
+ (formerly Genesys Industries, Inc)
+ STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
+ FOR THE YEARS ENDED JUNE 30, 2021 AND 2020
+
+ 
+ 
+
+ 
+ 
+ Common Shares 
+ Common Stock 
+ Preferred 
+ Shares 
+ Preferred 
+ Paid in Capital 
+ Accumulated Deficit 
+ Total
+
+ 
+ Balance, June 30, 2019 
+ 17,870,000 
+ $17,870 
+ 10,000,000 
+ $10,000 
+ $101,130 
+ $(30,582) 
+ $98,418 
+
+ 
+ Common stock issued for services 
+ 230,000 
+ 230 
+ — 
+ — 
+ 82,770 
+ — 
+ 83,000 
+
+ 
+ Beneficial conversion feature 
+ — 
+ — 
+ — 
+ — 
+ 200,000 
+ — 
+ 200,000 
+
+ 
+ Net loss 
+ — 
+ — 
+ — 
+ — 
+ — 
+ (321,008) 
+ (321,008)
+
+ 
+ Balance, June 30, 2020 
+ 18,100,000 
+ 18,100 
+ 10,000,000 
+ 10,000 
+ 383,900 
+ (351,590) 
+ 60,410 
+
+ 
+ Stock issued for asset acquisitions 
+ 10,000,000 
+ 10,000 
+ — 
+ — 
+ 2,790,000 
+ — 
+ 2,800,000 
+
+ 
+ Net loss 
+ — 
+ — 
+ — 
+ — 
+ — 
+ (3,143,140) 
+ (3,143,140)
+
+ 
+ Balance, June 30, 2021 
+ 28,100,000 
+ $28,100 
+ 10,000,000 
+ $10,000 
+ $3,173,900 
+ $(3,494,730) 
+ $(282,730)
+
+ 
+
+The
+accompanying notes are an integral part of these financial statements.
+
+ F-5 
+
+ 
+
+ 
+
+ 
+ FORZA INNOVATIONS INC.
+ (formerly Genesys Industries, Inc)
+ STATEMENTS OF CASH FLOWS
+
+ 
+ 
+
+ 
+ 
+ For the years Ended June 30,
+
+ 
+ 
+ 2022 
+ 2020 
+
+ 
+ Cash flows from operating activities: 
+ 
+ 
+
+ 
+ Net Income 
+ $(3,168,582) 
+ $(291,239)
+
+ 
+ Less: net (income) loss from discontinued operations 
+ 25,422 
+ (29,769)
+
+ 
+ Adjustments to reconcile net income to net cash used in operating activities: 
+ 
+ 
+
+ 
+ Depreciation and amortization 
+ 10,931 
+ — 
+
+ 
+ Debt discount amortization 
+ 12,500 
+ 137,500 
+
+ 
+ Loss on issuance of common stock 
+ — 
+ 40,000 
+
+ 
+ Loss on issuance of convertible debt 
+ — 
+ 75,000 
+
+ 
+ Debt discount amortization 
+ 12,500 
+ — 
+
+ 
+ Loss on asset acquisition – related party 
+ 2,704,865 
+ — 
+
+ 
+ Loss on disposition of assets and liabilities 
+ 365,019 
+ — 
+
+ 
+ Changes in operating assets and liabilities: 
+ 
+ 
+
+ 
+ Accounts payable 
+ 35,400 
+ — 
+
+ 
+ Accrued interest 
+ 44,915 
+ 5,484 
+
+ 
+ Operating cash flow from discontinued operations 
+ 23,327 
+ 84,637 
+
+ 
+ Net cash provided by operating activities 
+ 66,297 
+ 21,613 
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash flows from investing activities: 
+ 
+ 
+
+ 
+ Purchase of property and equipment 
+ (22,000) 
+ — 
+
+ 
+ Purchase of website 
+ (18,000) 
+ — 
+
+ 
+ Investing cash flow from discontinued operations 
+ (70,117) 
+ (256,227)
+
+ 
+ Net cash used in investing activities 
+ (110,117) 
+ (256,227)
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash flows from financing activities: 
+ 
+ 
+
+ 
+ Advances from related party 
+ 54,833 
+ 20,660 
+
+ 
+ Proceeds from convertible dent 
+ 
+ 125,000 
+
+ 
+ Financing cash flow from discontinued operations 
+ 2,664 
+ 93,628 
+
+ 
+ Net cash provided by financing activities 
+ 57,497 
+ 239,288 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net increase in cash 
+ 13,677 
+ 4,674 
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash, beginning of period 
+ — 
+ 170,205 
+
+ 
+ Less: cash of discontinued operations, end of period 
+ — 
+ (174,879)
+
+ 
+ Cash of continuing operations at end of period 
+ $13,677 
+ $— 
+
+ 
+ 
+ 
+ 
+
+ 
+ Supplemental disclosure of cash flow information: 
+ 
+ 
+
+ 
+ Cash paid for interest 
+ $— 
+ $— 
+
+ 
+ Cash paid for taxes 
+ $— 
+ $— 
+
+ 
+
+The
+accompanying notes are an integral part of these financial statements.
+
+ F-6 
+
+ 
+
+ 
+
+FORZA
+INNOVATIONS INC.
+
+(formerly
+Genesys Industries, Inc)
+
+NOTES
+TO FINANCIAL STATEMENTS
+
+JUNE
+30, 2021
+
+ 
+
+NOTE
+1 - NATURE OF OPERATIONS
+
+Forza
+Innovations Inc. (the "Company"), was incorporated on December 9, 2014 under the laws of the State of Florida. The Company
+was a diversified multi-industry manufacturer of complex metal components and products. We serve all general industrial markets such
+as Aerospace, Automotive, Commercial, Food Processing, Industrial, Maritime, Medical, Railroad, Oil and Gas, Packaging, Telecom, Textiles,
+Robotics, Space Travel, Transportation and many more. We are a vertically integrated precision CNC manufacturing and fabrication company
+with core emphasis on product design, engineering and precision manufacturing of complex components and products.
+
+On
+February 5, 2018, the Company formed Genesys Industries, LLC as a wholly owned subsidiary in the state of Missouri.
+
+On
+January 21, 2022, Shefali Vibhakar, President of the Company closed a Share Purchase Agreement (the "Agreement") that she
+entered into with Johnny Forzani to sell all of her 17,000,000 common shares and 10,000,000 preferred shares to Johnny Forzani for cash
+consideration of $177,000.
+
+Further,
+as part of the Agreement, Ms. Vibhakar agrees to spin out all of the Company s assets (except for certain machinery valued at $40,000
+– which is subject to a separate purchase agreement) as well as all of the Company s liabilities (except the Company s
+note with Mast Hill Capital, LLC). The value date of the assets and liabilities will be January 21, 2022.
+
+On
+January 21, 2022, a change in control of the Company occurred pursuant to the Agreement. Mr. Forzani now has voting control over 93.9%
+of the Company s issued and outstanding common stock.
+
+On
+January 21, 2022, the Company received the resignation of Shefali Vibhakar as the Company s President, Chief Executive Officer,
+Treasurer, Chief Financial Officer, Secretary and Director and appointed Johnny Forzani as its President, Chief Executive Officer, Treasurer,
+Chief Financial Officer and Secretary.
+
+Effective
+January 21, 2022, the Company s new address is 30 Forzani Way NW, Calgary, Alberta, Canada T3Z 1L5.
+
+On
+February 17, 2022, the Company filed Articles of Continuance with the Secretary of State for the state of Wyoming. Accordingly, the Company
+transferred its state of formation from Florida to Wyoming and became a Wyoming entity.
+
+On
+February 18, 2022, the Company filed a Certificate of Dissolution with the Secretary of State for the State of Florida, effectively dissolving
+the Company's existence in Florida.
+
+As
+of June 30, 2021, Forza Innovations has moved out of the precision CNC manufacturing and fabrication business and has moved into the
+health-tech wearable performance business. The Company has acquired the ownership and rights to certain late developmental stage
+products, including the J4 Sport, J4 X and J4 Fitbelt. These products are wearable back compression devices, used to relax, warmup,
+loosen, or relax stiff & sore muscles. The therapeutic application of heat causes a change in temperature of the soft tissues which
+decreases joint stiffness and relieves inflammation. 
+
+NOTE
+2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
+
+Basis
+of Presentation
+
+The
+Company s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the
+United States of America ("U.S. GAAP").
+
+ F-7 
+
+ 
+
+ 
+
+Use
+of estimates
+
+The
+preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
+and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
+date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates
+include the estimated useful lives of property and equipment. Actual results could differ from those estimates.
+
+Concentrations
+of Credit Risk
+
+We
+maintain our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. We continually monitor
+our banking relationships and consequently have not experienced any losses in our accounts. We believe we are not exposed to any significant
+credit risk on cash.
+
+Cash
+equivalents
+
+The
+Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. There
+were no cash equivalents for the year ended June 30, 2021 or 2020.
+
+Property,
+Plant and Equipment
+
+Property
+and equipment are carried at the lower of cost or net realizable value. Major betterments that extend the useful lives of assets are
+also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the
+cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.
+
+Stock-based
+Compensation
+
+In
+June 2018, the FASB issued ASU 2018-07, Compensation
+– Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU
+2018-07 allows companies to account for nonemployee awards in the same manner as employee awards. The guidance is effective for fiscal
+years beginning after December 15, 2018, and interim periods within those annual periods. We adopted this ASU on January 1, 2019. The
+adoption of ASU 2018-07 did not have a material impact on our consolidated financial statements. 
+
+Fair
+value of financial instruments
+
+The
+Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial
+instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification ("Paragraph 820-10-35-37") to measure
+the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles
+generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase
+consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy
+which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy
+gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority
+to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
+
+Level
+1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
+
+Level
+2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable
+as of the reporting date.
+
+Level
+3: Pricing inputs that are generally unobservable inputs and not corroborated by market data.
+
+The
+carrying amount of the Company s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate
+their fair value because of the short maturity of those instruments. The Company s notes payable approximates the fair value
+of such instruments based upon management s best estimate of interest rates that would be available to the Company for similar
+financial arrangements at June 30, 2021.
+
+The
+Company does not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis as of June 30, 2021 or
+2022.
+
+ F-8 
+
+ 
+
+ 
+
+Income
+taxes
+
+The
+Company follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and
+liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under
+this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets
+and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax
+assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be
+realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal
+years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities
+of a change in tax rates is recognized in the Statements of Income in the period that includes the enactment date.
+
+The
+Company adopted section 740-10-25 of the FASB Accounting Standards Codification ("Section 740-10-25") with regards to uncertainty
+income taxes. Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax
+return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from
+an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities,
+based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should
+be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement.
+Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim
+periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income
+tax benefits according to the provisions of Section 740-10-25.
+
+Net
+income (loss) per common share
+
+Net
+income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net
+income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding
+during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average
+number of shares of common stock and potentially outstanding shares of common stock during the period. The weighted average number
+of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the
+first period presented.
+
+The
+Company s diluted loss per share is the same as the basic loss per share for the years ended June 30, 2021 and 2020, as the inclusion
+of any potential shares would have had an anti-dilutive effect due to the Company generating a loss.
+
+Recently
+issued accounting pronouncements
+
+The
+Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on
+the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements
+that have been issued that might have a material impact on its financial position or results of operations.
+
+NOTE
+3 - GOING CONCERN
+
+The
+accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity
+of operations, realization of assets, and liquidation of liabilities in the normal course of business. As of June 30, 2021, the
+Company has an accumulated deficit of $3,494,730 ($3,069,884 of which is from the FY 2022 loss on the asset acquisition and disposition
+of assets).
+
+While
+the Company is successfully executing its growth strategy, its cash position may not still be sufficient to support the Company s
+daily operations without additional financing. While the Company believes in the viability of its strategy to produce sales volume and
+in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going
+concern is dependent upon the Company s ability to further implement its business plan and generate sufficient revenues. The financial
+statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management
+believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity
+for the Company to continue as a going concern.
+
+ F-9 
+
+ 
+
+ 
+
+NOTE
+4 – PROPERTY, PLANT & EQUIPMENT
+
+Long
+lived assets, including property and equipment and certain intangible assets to be held and used by the Company are reviewed for impairment
+whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Impairment losses
+are recognized if expected future cash flows of the related assets are less than their carrying values. Measurement of an impairment
+loss is based on the fair value of the asset. Long-lived assets and certain identifiable intangibles to be disposed of are reported at
+the lower of carrying amount or fair value less cost to sell.
+
+Property
+and Equipment and intangible assets are first recorded at cost. Depreciation and/or amortization is computed using the straight-line
+method over the estimated useful lives of the various classes of assets between three and five years. Leasehold improvements are being
+depreciated over ten years, and the building over twenty years.
+
+Maintenance
+and repair expenses, as incurred, are charged to expense. Betterments and renewals are capitalized in plant and equipment accounts. Cost
+and accumulated depreciation applicable to items replaced or retired are eliminated from the related accounts with any gain or loss on
+the disposition included as income.
+
+Property,
+Plant and equipment stated at cost, less accumulated depreciation consisted of the following:
+
+ 
+ 
+ June 30, 2021 
+ June 30, 2020
+
+ 
+ Leasehold Improvements 
+ $— 
+ $100,965 
+
+ 
+ Machinery and Equipment 
+ 117,135 
+ 353,888 
+
+ 
+ Real Property & Plant 
+ — 
+ 256,443 
+
+ 
+ Less: accumulated depreciation 
+ 8,118 
+ (124,312)
+
+ 
+ Fixed assets, net 
+ $109,017 
+ $586,984 
+
+ 
+
+Depreciation
+expense
+
+Depreciation
+expense for the years ended June 30, 2021 and 2020 was $8,118 and $71,64, respectively.
+
+Our
+capitalized software cost, less accumulated amortization consisted of the following:
+
+ 
+ 
+ June 30, 2021
+
+ 
+ Software 
+ $18,000 
+
+ 
+ Less: accumulated depreciation 
+ 2,750 
+
+ 
+ Software, net 
+ $15,250 
+
+ 
+
+Amortization
+expense
+
+Amortization
+expense for the years ended June 30, 2021 and 2020 was $2,750 and $0, respectively.
+
+NOTE
+5 – CONVERTIBLE DEBT
+
+On
+January 2, 2020, the Company executed a 10% convertible promissory note in which it agreed to borrow up to $300,000. The note is convertible
+at a price per share equal to the lower of (a) the Fixed Conversion Price (which is fixed at a
+price equal to $0.30); or (b) 80% of the lowest trading price of the Company s common stock during the 5 consecutive trading days
+prior to the date on which lender elects to convert all or part of the Note. The initial deposit of $125,000 was made on January
+15, 2020 and included a $25,000 OID. As required by ASC 470-20-30-6 the Company recognized and measured the embedded beneficial
+conversion feature at the commitment date of $200,000 which was credited to paid in capital, a $150,000 debt discount and a $75,000 loss
+on the issuance of convertible debt. As of June 30, 2021, all of the debt discount has been amortized to interest expense. As of June
+30, 2021, there is $150,000 and $40,250 of principal and interest due on this loan, respectively.
+
+ F-10 
+
+ 
+
+ 
+
+NOTE
+6 - NOTE PAYABLE
+
+On
+February 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit ("LOC") also
+recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC ("TCP"),
+an entity controlled by the Company s former sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all
+of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of February
+5, 2017. The LOC bears interest at 5% per annum and is due on demand. On January 21, 2022, TCP assigned all of its rights, title and
+interest in the debt to Front Row Seating Inc. As of June 30, 2021 and 2020, the Company owed $122,729 and $122,729 of principal and
+$17,339 and $11,279 of accrued interest on the LOC, respectively.
+
+NOTE
+7 - STOCKHOLDERS EQUITY
+
+On
+February 19, 2022, the Company filed a Definitive 14C in order to ratify the written consent received from one shareholder, holding 96.1%
+of our voting power to: (1) to amend the Company s Articles of Incorporation, as amended (the "Articles") to change
+our corporate name from Genesys Industries, Inc. to Forza Innovations Inc. (the "Name Change"); (2) to amend the Articles
+to increase the number of authorized shares of Class A Common Stock we may issue from 100,000,000 to 700,000,000 (the "Share Increase");
+and, (3) to increase the number of the Company's total issued and outstanding shares of Class A Common Stock by conducting a forward
+stock split at the rate of 10 shares every 1 share currently issued and outstanding (the "Forward Split"). FINRA has
+reviewed the Company s submission of the Name Change, the Share Increase and the Forward Split and is waiting to process as soon
+as the Company becomes current with its SEC filings.
+
+Preferred
+stock
+
+Preferred
+stock includes 25,000,000 shares of authorized at a par value of $0.001. Preferred stock includes 25,000,000 shares of Class B authorized
+at a par value of $0.001. The Preferred Stock constitutes a convertible stock in which (1) one Preferred Share is convertible into (5)
+five Common Shares. The Preferred Stockholders are entitled to vote on any matters on which the common stock holders are entitled to
+vote.
+
+NOTE
+8 - RELATED PARTY TRANSACTIONS 
+
+On
+January 21, 2022, the Company entered into an acquisition agreement with Mr. Forzani to acquire all of the ownership and the rights to
+certain late developmental stage products, including the J4 Sport, J4 X and J4 Fitbelt in exchange for the issuance of 10,000,000 common
+shares. The shares were valued at $0.28, the closing stock price on the date of the agreement, for a total value of $2,800,000. The assets
+were valued at cost of $95,135, resulting in a loss on asset acquisition of $2,704,865. As a result of this acquisition, the Company
+is moving out of the precision CNC manufacturing and fabrication business and moving into the health-tech wearable performance business.
+
+During
+the year ended June 30, 2021, Mr. Forzani advanced the Company $54,833, for general operating expenses, the advance is non-interest bearing
+and due on demand.
+
+NOTE
+9 – DISCONTINUED OPERATIONS
+
+On
+January 21, 2022, Shefali Vibhakar, President of the Company closed a Share Purchase Agreement (the "Agreement") that she
+entered into with Johnny Forzani to sell all of her 17,000,000 common shares and 10,000,000 preferred shares to Johnny Forzani for cash
+consideration of $177,000.
+
+Further,
+as part of the Agreement, Ms. Vibhakar agrees to spin out all of the Company s assets (except for certain machinery valued at $40,000
+– which is subject to a separate purchase agreement) as well as all of the Company s liabilities (except the Company s
+note with Mast Hill Capital, LLC and Twiga Capital). The value date of the assets and liabilities will be January 21, 2022.
+
+ F-11 
+
+ 
+
+ 
+
+In
+accordance with the provisions of ASC 205-20, Presentation of Financial Statements, we have separately reported the assets and
+liabilities of the discontinued operations in the consolidated balance sheets. The assets and liabilities have been reflected as discontinued
+operations in the balance sheets as of June 30, 2021 and 2020, and consist of the following:
+
+ 
+ 
+ June 30, 2021 
+ June 30, 2020
+
+ 
+ Current Assets of Discontinued Operations: 
+ 
+ 
+
+ 
+ Cash 
+ $— 
+ $174,879 
+
+ 
+ Accounts receivable 
+ — 
+ 86,375 
+
+ 
+ Total Current Assets of Discontinued Operations: 
+ — 
+ 261,254 
+
+ 
+ Machinery and equipment, net 
+ — 
+ 360,431 
+
+ 
+ Real property & plant, net 
+ — 
+ 226,553 
+
+ 
+ Total Non-Current Assets of Discontinued Operations: 
+ $— 
+ $586,984 
+
+ 
+ 
+ 
+ 
+
+ 
+ Current Liabilities of Discontinued Operations: 
+ 
+ 
+
+ 
+ Accounts payable and accrued liabilities 
+ $— 
+ $48,868 
+
+ 
+ Accrued interest, related party 
+ — 
+ 11,279 
+
+ 
+ Accrued compensation 
+ — 
+ 6,548 
+
+ 
+ Lines of credit 
+ — 
+ 37,547 
+
+ 
+ Loans payable 
+ — 
+ 47,377 
+
+ 
+ Due to related party 
+ — 
+ 122,729 
+
+ 
+ Total Current Liabilities of Discontinued Operations 
+ — 
+ 274,348 
+
+ 
+ 
+ 
+ 
+
+ 
+ Non-Current Liabilities of Discontinued Operations: 
+ 
+ 
+
+ 
+ Line of credit 
+ — 
+ 70,246 
+
+ 
+ Loans payable 
+ — 
+ 290,734 
+
+ 
+ Total Non-Current Liabilities of Discontinued Operations 
+ $— 
+ $360,980 
+
+ 
+
+In
+accordance with the provisions of ASC 205-20, Presentation of Financial Statements, we have separately reported the assets and
+liabilities of the discontinued operations in the consolidated balance sheets. The income and expenses have been reflected as discontinued
+operations in the consolidated Statements of Operations for the years ended June 30, 2021 and 2020, and consist of the following:
+
+ 
+ 
+ For the Years Ended June 30,
+
+ 
+ 
+ 2022 
+ 2020
+
+ 
+ Revenue 
+ $381,472 
+ $605,433 
+
+ 
+ Cost of revenue 
+ 269,638 
+ 398,385 
+
+ 
+ Gross Margin 
+ 111,834 
+ 207,048 
+
+ 
+ Operating Expenses: 
+ 
+ 
+
+ 
+ Professional fees 
+ — 
+ 3,800 
+
+ 
+ Payroll expense 
+ 32,676 
+ 82,113 
+
+ 
+ General & administrative expenses 
+ 37,882 
+ 112,550 
+
+ 
+ Total operating expenses 
+ 70,558 
+ 198,463 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income from operations 
+ 41,276 
+ 8,585 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total other expense 
+ (15,854) 
+ (38,354)
+
+ 
+ Net income (loss) from discontinued operations 
+ $25,442 
+ $(29,769)
+
+ 
+
+ F-12 
+
+ 
+
+ 
+
+NOTE
+10 – INCOME TAXES
+
+Deferred
+taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating
+loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences
+are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a
+valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets
+will not be realized. The Company has evaluated Staff Accounting Bulletin No. 118 regarding the impact of the decreased tax rates of
+the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the
+date of enactment. The U.S. federal income tax rate of 21% is being used for the fiscal year ended June 30, 2021 and 2020.
+
+Net
+deferred tax assets consist of the following components as of June 30:
+
+ 
+ 
+ 2022 
+ 2020
+
+ 
+ Deferred Tax Assets: 
+ 
+ 
+
+ 
+ NOL Carryover 
+ $732,000 
+ $73,800 
+
+ 
+ Deferred tax liabilities: 
+ 
+ 
+
+ 
+ Less valuation allowance 
+ (732,000) 
+ $(73,800)
+
+ 
+ Net deferred tax assets 
+ $— 
+ $— 
+
+ 
+
+The
+income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from
+continuing operations for the period ended June 30, due to the following:
+
+ 
+ 
+ 2022 
+ 2020
+
+ 
+ Federal income tax benefit attributable to: 
+ 
+ 
+
+ 
+ Current operations 
+ $(658,000) 
+ $(67,400)
+
+ 
+ Less: Valuation allowance 
+ 658,000 
+ 67,400)
+
+ 
+ Net provision for Federal income taxes 
+ $— 
+ $— 
+
+ 
+
+ F-13 
+
+ 
+
+ 
+
+At
+June 30, 2021, the Company had net operating loss carry forwards of approximately $732,000 that may be offset against future taxable
+income from the year 2022 to 2040. No tax benefit has been reported in the June 30, 2021 financial statements since the potential tax
+benefit is offset by a valuation allowance of the same amount.
+
+Due
+to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for Federal Income tax reporting
+purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to
+use in future years.
+
+NOTE
+11 - SUBSEQUENT EVENTS
+
+In
+accordance with SFAS 165 (ASC 855-10) management has performed an evaluation of subsequent events through the date that the financial
+statements were available to be issued and has determined that it has no material subsequent events to disclose in these financial statements.
+
+ F-14 
+
+ 
+
+ 
+
+ 
+
+TABLE
+OF CONTENTS
+
+ 
+ 
+ 
+
+ 
+ 
+ Page
+
+ 
+ PROSPECTUS
+ SUMMARY
+ 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001790665_greenrose_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001790665_greenrose_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001790665_greenrose_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001792694_affinia_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001792694_affinia_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d86bf0f1701859e8549b132aed3c14eafafd5f1
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights, and is qualified in its entirety by, information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, especially the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and the related notes appearing elsewhere in this prospectus, before making an investment decision. As used in this prospectus, unless the context otherwise requires, references to we, us, our, the company, Affinia and Affinia Therapeutics refer to Affinia Therapeutics Inc. Overview We are a preclinical stage company pioneering a new class of rationally designed gene therapies with potentially curative benefit in patients with both rare and prevalent devastating diseases. Our rationally designed gene therapy candidates are methodically created to address the key limitations of current approaches and to meet the specific needs of a disease. We created our proprietary Affinia Rationally-designed Therapies (ART) platform to develop these novel therapies, focusing on the three key components of a gene therapy: capsids, which are the outer shells of a virus used to deliver the genetic code to tissues to treat a disease; promoters, which control how the cells read the genetic code that is delivered; and manufacturing approaches, which determine the quality and cost of these potential medicines. Our goal is to realize the full promise of gene therapy by addressing key limitations of current approaches, including tissue targeting specificity, cell expression and manufacturability. The potential of our platform has attracted a team of seasoned executives with extensive experience in advancing transformational gene therapy technologies from discovery through approval and commercialization. Our ART platform is versatile and modular, and we believe that by applying it to the key limitations of gene therapy in each indication we pursue, we have the potential to build a deep pipeline of differentiated product candidates across multiple therapeutic areas and genetic modalities, including gene replacement, vectorized antibody, gene editing and RNA knockdown approaches. We are focused on helping patients who have a dire medical need and where our platform can have a transformative advantage. We plan to submit multiple IND applications through 2025. For our initial programs, we are leveraging our next-generation capsid, Anc80L65. In preclinical studies, Anc80L65 has demonstrated rapid and broad gene expression in the central nervous system (CNS) with expression efficiency up to 40 times higher than the conventional capsid, AAV9. Our lead product candidate, AFTX-001, is Anc80L65-ARSA for the treatment of metachromatic leukodystrophy (MLD). MLD is a rare, rapidly progressive and fatal genetic disease that results from the deficiency of functional arylsulfatase A (ARSA), an enzyme that is critical for neuronal survival. Patients with the most common form of MLD, called late infantile MLD, typically die before the age of eight years. AFTX-001 delivers a functional ARSA transgene via a one-time dose to the CNS through a routine outpatient lumbar puncture (LP) administration. We believe our approach will lead to rapid and broad expression of the ARSA enzyme in the CNS and peripheral nervous system (PNS), resulting in transformative clinical benefit. We anticipate an IND submission for AFTX-001 in the first half of 2023. Our second product candidate, AFTX-002, is Anc80L65-trastuzumab for the treatment of brain metastases secondary to human epidermal growth factor receptor 2 overexpressing (HER2+) breast cancer (BMBC). BMBC is a common and deadly complication of HER2+ breast cancer with a median survival of only 18 months. Trastuzumab is an approved monoclonal antibody for the treatment of Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to completion, dated January 4, 2022 PRELIMINARY PROSPECTUS Shares Common Stock This is an initial public offering of shares of common stock of Affinia Therapeutics Inc. We are offering shares of our common stock. Prior to this offering, there has been no public market for our common stock. It is currently estimated that the initial public offering price per share will be between $ and $ . We have applied to list our common stock on the Nasdaq Global Market under the trading symbol AFTX. We are an emerging growth company and a smaller reporting company as defined under U.S. federal securities laws and, as such, will be subject to reduced public company reporting requirements for this prospectus and future filings. See Prospectus Summary Implications of Being an Emerging Growth Company and a Smaller Reporting Company. Investing in our common stock involves risks. See Risk Factors beginning on page 16 to read about factors you should consider before buying shares of our common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Initial public offering price $ $ Underwriting discounts(1) $ $ Proceeds, before expenses, to Affinia Therapeutics Inc. $ $ (1) See the section titled Underwriting for a description of the compensation payable to the underwriters. To the extent that the underwriters sell more than shares of common stock, the underwriters have the option to purchase up to an additional shares from us at the initial price to the public less the underwriting discount. The underwriters expect to deliver the shares against payment in New York, New York on , 2022. Goldman Sachs & Co. LLC Jefferies Piper Sandler Chardan Prospectus dated , 2022 Table of Contents HER2+ breast cancer; however current methods of administration are impractical for achieving sustained therapeutic levels in the brain sufficient to be effective against BMBC. AFTX-002 is designed to be given as a one-time dose by LP administration to deliver the genetic code that enables the cells in the brain to produce their own trastuzumab in close proximity to the brain metastases. Our pharmacokinetic modeling analysis showed that the levels of trastuzumab in the brain achieved by our gene therapy approach are up to 100 times higher than those achieved by current methods of administration. We believe our approach results in trastuzumab levels in the brain that are clinically sufficient to control BMBC and will result in transformative clinical benefit. We anticipate an IND submission for AFTX-002 in the second half of 2023. In addition to our MLD and BMBC programs, we are also engineering capsids for use in programs for Duchenne muscular dystrophy (DMD), myotonic dystrophy 1 (DM1) and cystic fibrosis (CF) via a multi-year collaboration (Vertex Agreement) that we entered into in 2020 with Vertex Pharmaceuticals Incorporated (Vertex). Under the terms of the Vertex Agreement, we are eligible to receive development, regulatory and sales-based milestone payments of up to $4.7 billion in the aggregate for all products and modalities. We are also eligible to receive tiered mid-single digit sales-based royalties for each licensed product, subject to customary offsets and deductions. We believe this collaboration with Vertex not only allows us to expand the therapeutic and modality footprint of our ART platform but also validates its potential. We plan on using our initial programs as gateway indications, meaning that if the initial program is successful, we can utilize the capsid or genetic modality of that program for a wave of additional gene therapy product candidates. We believe this strategy may reduce development risks and accelerate timelines for subsequent programs and allow us to efficiently build portfolios in neurological, neuro-oncological, neuromuscular, pulmonary and other therapeutic areas. Our ART Platform Advances in human biology research have elucidated the genetic cause of many rare diseases and subpopulations of prevalent diseases over the past several decades, setting the stage for treating these diseases with gene therapies. However, we believe current gene therapy approaches using conventional AAV capsids, promoters and manufacturing approaches are limited in their tissue targeting specificity, cell expression and manufacturability, resulting in sub-optimal efficacy and toxicity and inconsistent product quality. This leaves many patients who could benefit from gene therapy without effective treatment options. Our ART platform is created to address these key limitations of conventional gene therapies. The ART platform consists of three pillars: (i) Novel capsids (cART): to enhance the tissue targeting specificity, immunologic profile and manufacturability of gene therapies; (ii) Novel promoters (pART): to precisely modulate the expression of the therapeutic transgene in specific cell types; and (iii) Novel manufacturing approaches (mART): to improve quality, yields and scalability across multiple product candidates by using new processes, cell lines and transfection agents. Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+Prospectus Summary 1 Risk Factors 31 Special Note Regarding Forward-Looking Statements 70 Use of Proceeds 71 Dividend Policy 72 Capitalization 73 Dilution 74 Management s Discussion and Analysis of Financial Condition and Results of Operations 80 Quantitative and Qualitative Disclosures About Market Risk 96 Business 98 Regulation 107 Management 129 Related Party Transactions 136 Security Ownership of Certain Beneficial Owners and Management 138 Description of Ordinary Shares 140 Shares Eligible for Future Sale 147 Taxation 149 Enforceability of Civil Liabilities 155 Underwriting 156 Expenses Related to This Offering 160 Legal Matters 160 Experts 161 Interests of Named Experts and Counsel 161 Disclosure of Commission Position on Indemnification 161 Where You Can Find Additional Information 161 Financial Statements F-1 i About this Prospectus This prospectus is part of a registration statement we filed with the U.S. Securities and Exchange Commission (the "Commission" or the "SEC"). We and the Underwriter have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses prepared by us or on our behalf or to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the Class A Ordinary Shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. We are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted or where the person making the offer or sale is not qualified to do so or to any person to whom it is not permitted to make such offer or sale. The information contained in this prospectus is current only as of the date on the front cover of the prospectus. The business, financial condition, results of operations and prospects of the VIE and the VIE s subsidiaries may have changed since that date. All dealers that buy, sell or trade our Class A Ordinary Shares, whether or not participating in this offering, may be required to deliver a prospectus 25 days after this registration agreement is declared effective by the Commission. This delivery requirement is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. For investors outside of the United States: We have not done anything that would permit this Offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than the United States. Persons outside of the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the Offering and the distribution of this prospectus outside of the United States. This prospectus contains translations of certain RMB (renminbi which is the official currency in China) amounts into U.S. dollar amounts at specified rates solely for the convenience of the reader. All reference to "U.S. dollars," "USD," "US$" or "$" are to United States dollars. All reference to "HKD" is to Hong Kong dollars. The relevant exchange rates are listed below: As of and for the six months ended March 31, As of and for the years ended September 30, 2022 2021 2021 2020 Period-end RMB: US$ exchange rate 6.5536 6.3393 6.4567 6.8013 Period- average RMB: US$ exchange rate 6.5028 6.3472 6.4989 6.9941 All references to the "PRC" or "China" in this prospectus refer to the People s Republic of China. All references to "Hong Kong" or "H.K." in this prospectus refer to Hong Kong Special Administrative Region of the People s Republic of China. All references to the "United States," "U.S." or "US" refer to the United States of America. ii Other Pertinent Information Except where the context otherwise requires and for purposes of this prospectus only, references in this prospectus to: "Sancai Holding" are to Sancai Holding Group Ltd, a Cayman Islands exempted company; "Sancai Seychelles" are to Sancai Limited, a Seychelles company and a wholly-owned subsidiary of Sancai Holding; "Sancai HK" are to Sancai International Holding Limited, a Hong Kong company and a wholly-owned subsidiary of Sancai Seychelles; "Sancai WFOE" are to Xi an Minglan Management Co., Ltd., a PRC company and a wholly-owned subsidiary of Sancai HK; "Sancaijia" or "VIE" are to Sancaijia Co., Ltd., a PRC company and a variable interest entity that has entered into the VIE Agreements (as defined below) with Sancai WFOE; "Sancaijia Technology" are to Sancaijia Technology Co., Ltd., a PRC company and a wholly-owned subsidiary of Sancaijia; "Xi an Dacai" are to Xi an Dacai Management Consulting Co., Ltd., a PRC company and a wholly-owned subsidiary of Sancaijia; "Shanghai Wenxu" are to Shanghai Wenxu Information Technology Co., Ltd., a PRC company and a wholly-owned subsidiary of Sancaijia; "Caibaoyun" are to Caibaoyun Settlement Technology (Xi an) Co., Ltd., a PRC company and a wholly-owned subsidiary of Sancaijia; "Xi an Miaobijia" are to Xi an Miaobijia Internet Co., Ltd. formerly known as Sancaijia Property Industry Service Co., Ltd., a PRC company and a wholly-owned subsidiary of Sancaijia Technology; and "we," "us," "our Company," or "our" are to Sancai Holding and its subsidiaries. "VIE Agreements" are to the (i) Exclusive Technical Consultation and Service Agreement by and between Sancai WFOE and Sancaijia, dated February 25, 2020, as amended and restated on June 28, 2022, (ii) Exclusive Call Option Agreements by and among Sancai WFOE, Sancaijia and each shareholder of Sancaijia, dated February 25, 2020, (iii) Business Operation Agreement by and among Sancai WFOE, Sancaijia and the shareholders of Sancaijia, dated February 25, 2020, (iv) Equity Pledge Agreement by and among Sancai WFOE, Sancaijia and each shareholder of Sancaijia, dated February 25, 2020, (v) Shareholder Voting Proxy Agreement by and among Sancai WFOE, Sancaijia and each shareholder of Sancaijia, dated February 25, 2020, and (vi) Spousal Consent Letter executed by respective spouses of Mr. Ning Wen, Mr. Lizhi He and Mr. Zhijie Zhang, dated February 25, 2020. "VATS License" are to two types of telecom operating licenses for operators in China, namely, licenses for basic telecommunications services and licenses for value-added telecommunications services. "ICP License" is to a VATS License with the business scope of internet information service that commercial Internet information services operators are required to obtain.; and "EDI License" is to a VATS License with the business scope of online data processing and transaction processing services that commercial Internet information services operators are required to obtain. Sancai Holding is a holding company incorporated under the laws of the Cayman Islands as an exempted company with limited liability and a majority of our outstanding securities are owned by non-U.S. residents. Under the rules of the SEC, Sancai Holding currently qualifies for treatment as a "foreign private issuer." As a foreign private issuer, Sancai Holding will not be required to file periodic reports and financial statements with the SEC as frequently or as promptly as domestic registrants whose securities are registered under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Sancai Holding does not have any material operation. Sancaijia and its subsidiaries and branch offices conduct business in China using RMB, the currency of China. Our consolidated financial statements are presented in United States dollars. In this prospectus, we refer to assets, obligations, commitments and liabilities in our consolidated financial statements in United States dollars. These dollar references are based on the exchange rate of RMB to United States dollars, determined as of a specific date or for a specific period. Changes in the exchange rate will affect the amount of our obligations and the value of our assets in terms of United States dollars which may result in an increase or decrease in the amount of our obligations and the value of our assets, including accounts receivable. Industry and Market Data This prospectus includes information with respect to market and industry conditions and market share from third-party sources or based upon estimates using such sources when available. We have not, directly or indirectly, sponsored or participated in the publication of any of such materials. We believe that such information and estimates are reasonable and reliable. We also assume the information extracted from publications of third-party sources has been accurately reproduced. We understand that we would be liable for the information included in this prospectus if any part of the information was incorrect, misleading or imprecise to a material extent. iii PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read the entire prospectus, including our financial statements and the related notes and management s discussion and analysis incorporated herein by reference. You should also consider, among other things, the matters described under "Risk Factors" in each case appearing elsewhere in this prospectus. Overview Sancai Holding is an exempted company with limited liabilities incorporated on July 9, 2019 in the Cayman Islands. Sancai Holding is a holding company and does not have any significant assets or operation. Sancai WFOE was incorporated on December 18, 2019 under the laws of PRC and is an indirect subsidiary of Sancai Holding. Sancaijia was incorporated on November 6, 2018 under the laws of PRC. Sancaijia provides digitalization solutions through standard software-as-a-service ("SaaS") platform for small businesses. Mr. Ning Wen, the Chairman of the Board of Directors and Chief Executive Officer of Sancai Holding, owns 63.0% equity of Sancaijia. The remaining equity of Sancaijia is beneficially owned by Lizhi He (20.0%), Lizhen Tang (13.0%) and Zhijie Zhang (4.0%). Due to PRC legal restrictions on foreign ownership in the value-added telecommunication services, which is included in the registered business scopes of Sancaijia and its subsidiary Xi an Miaobijia, Sancai Holding is not eligible to hold direct or indirect equity interest in Sancaijia. Sancaijia and Xi an Miaobijia have obtained specific governmental licenses for operation in the value-added telecommunication business, which is subject to the restriction that foreign ownership shall not exceed 50% of the equity of the PRC company engaging in such business according to the latest version of the Negative List (Edition 2021) that took effect on January 1, 2022. Xi an Dacai, Shanghai Wenxu, Sansaijia Technology and Caibaoyun currently operate in businesses that are not within the categories in which foreign investment is currently restricted or prohibited. Xi an Dacai, Shanghai Wenxu, Sansaijia Technology and Caibaoyun collectively account for about 36.9% and 0.14% of the total revenue for the fiscal years ended September 2021 and 2020, respectively. However, it is uncertain whether, in the future, Sancaijia and its subsidiaries current operations or any future business will be deemed to be restricted or prohibited in the "negative list", which may be amended from time to time by MOFCOM, NDRC or other PRC governmental agencies. To illustrate, Sancaijia currently operates the value-added telecommunications services in China, which provides standard SaaS platform application services. Xi an Miaobijia is registered to operate the value-added telecommunications services. However, Xi an Miaobijia does not have any assets and has not begun operating as of the date of this prospectus. Sancaijia plans to promote the SaaS platform through Xi an Miaobijia in the agriculture industry and consumer services in the future. Xi an Dacai, Shanghai Wenxu, Sancaijia Technology or Caibaoyun currently do not operate in any businesses that are deem as value-added telecommunications services, either by themselves or through Sancaijia or Xi an Miaobijia, but may decide to engage in value-added telecommunication services, which are subject to strict business licensing requirements and certain restrictions or prohibitions on foreign ownership. The VIE structure would afford Sancai Holding greater flexibility in expanding the business scope and implementing the business strategies of Sancaijia and its subsidiaries in compliance with PRC laws and regulations in the future as its business continues to expand Therefore, in February 2020, Sancai WFOE entered into a series of contractual arrangements with Sancaijia and its shareholders. The contractual arrangements consist of the business operation agreement, shareholder voting proxy agreement, equity pledge agreement, exclusive technical consultation and service agreement as amended and restated on June 28, 2022, exclusive call option agreement and spousal consent letters (the "VIE Agreements"). We have evaluated the guidance in FASB ASC 810 and determined that Sancai WFOE is considered the primary beneficiary of Sancaijia and its subsidiaries for accounting purposes, based on the VIE Agreements. Sancai Holding has indirect ownership in 100% of the equity in Sancai WFOE. Accordingly, under U.S. GAAP, we treat them as consolidated affiliated entities and have consolidated the assets, liabilities, revenues, expenses and cash flows that are directly attributable to Sancaijia and its subsidiaries in our consolidated financial statements in accordance with U.S. GAAP. Some subsidiaries of Sancaijia currently operate certain businesses which are not within the categories in which foreign investment is currently restricted or prohibited. We believe that the VIE structure affords great flexibility in carrying out the business and implementing the business strategies of Sancaijia and its subsidiaries. The VIE structure is used to provide investors with exposure to foreign investment in China-based companies where Chinese law prohibits direct foreign investment in the operating companies. However, the VIE structure involves unique risks to investors in Sancai Holding where Sancai Holding could instead have equity ownership. Uncertainties exist as to our ability to enforce the VIE Agreements. The VIE Agreements have not been tested in a court of law and may not be effective in providing control over the VIE, and we are subject to risks due to the uncertainty of the interpretation and application of the laws and regulations of the PRC, regarding the VIE and the VIE structure, including, but not limited to, regulatory review of overseas listing of PRC companies through a special purpose vehicle, and the validity and enforcement of the contractual arrangements with the VIE. The Chinese regulatory authorities could disallow the VIE structure, which could result in a material change in the operations of the VIE and the VIE s subsidiaries and the value of our securities could decline or become worthless. For a description of our corporate structure and VIE Agreements, see "Corporate History and Structure" starting on page 75. For certain risks related to the contractual arrangements, see "Risk Factors—Risks Related to Our Corporate Structure" starting on page 31. Discussions of the business in this prospectus relates to the business and operations of the VIE and the VIE s subsidiaries. However, investors in our Class A Ordinary Shares should be aware that they are purchasing equity in Sancai Holding, the Caymans Islands holding company, which does not own any equity interest in the VIE. Prior to December 2020, Sancai Real Estate Management Co., Ltd., a then fully owned subsidiary of Sancaijia, engaged in the distribution of smart locks for residential properties and offices as an added value for the corporate clients that subscribe to Sancaijia s SaaS platform application. Sancai Real Estate Management Co., Ltd. also leased residential properties from individual property owners on a long-term basis, renovated and furnished such properties in a clean and modern manner, and rented them out to individual tenants. 1 On December 10, 2020, Sancaijia entered into an equity transfer agreement, which was closed on December 28, 2020, to sell 100% of the equity interest it held in Sancai Real Estate Management Co., Ltd. to Sancai Group Co., Ltd., a former related party of Sancai Holding, for a total of approximately $3.42 million (RMB 22.33 million). Mr. Ning Wen, the Chairman of the Board of Directors and Chief Executive Officer of Sancai Holding, was the legal representative and a majority shareholder of Sancai Group Co., Ltd. As the VIE shifted its operating strategy to focus on SaaS platform development and related technical service, on December 8, 2020, Mr. Ning Wen sold his all of his ownership interest of Sancai Group Co., Ltd. to a non-related party and resigned as legal representative. Since then, Sancai Group Co., Ltd. has been controlled by a non-related party. As of December 28, 2020, the net book value of Sancai Real Estate Management Co., Ltd. was $3.12 million. A gain from the disposal of discontinued operation of $0.30 million was recorded for the fiscal year ended September 30, 2021. As a result, the rental property subleasing business and distribution of smart locks were discontinued as of December 28, 2020. Products and Services The VIE and the VIE s subsidiaries provide two services: standard SaaS platform application services and SaaS platform customization and development, which are collectively referred to as SaaS solutions. The SaaS solutions have a limited operating history. Revenue for the fiscal year ended September 30, 2021 and 2020 was $7.89 million and $3.65 million (restated), respectively. Revenue for the six months ended March 31, 2022 and 2021 was $1.88 million and $4.52 million, respectively. Historical results and growth may not be indicative of the future performance of the VIE and the VIE s subsidiaries, and the VIE and the VIE s subsidiaries may fail to continue the growth or maintain the historical growth rates. See "Risk Factors – Risks Related to the Business and Industry – The VIE and the VIE s subsidiaries have a limited operating history in a competitive and rapidly evolving industry; it may be difficult to evaluate their prospects, and the VIE and the VIE s subsidiaries may not be able to effectively manage the growth." SaaS Solutions – Standard SaaS Platform Application Services The standard SaaS platform application services provide digitalization solutions for small businesses. Sancaijia built a mobile management solution system that enables business owners to manage and monitor their operations via mobile phones. The standard SaaS platform application services currently offer the following functions: customer acquisition, transaction, settlement, customer management, employee management, data analysis and supply chain services for the duration of the contract period, which is usually a year. As the business develops and the application industries grows, Sancaijia is remodeling the SaaS platform application to meet the needs of business owners in different industries, especially in the agriculture industry and consumer services. Sancaijia plans to use the current research and development staff and does not expect to increase its research and development expense in the near future. Sancaijia typically charges a 3% to 5% fee on the transaction settlement amount, between the businesses Sancaijia serves and its customers, which are completed on the SaaS platform. SaaS Solutions – SaaS Platform Customization and Development Sancaijia, Sancaijia Technology and Caibaoyun also provide customization and development services according to the requirements of their customers. During fiscal year 2021, revenue from customization and development services were mainly from Caibaoyun. Customers are charged a one-time customization fee. Certain customers can request warranty services to be performed for certain customization and development services. The warranty fee is typically at an amount equal to less than 10% of the customization fee. These services are mainly considered as a separate performance obligation. The customization fee and warranty fee are based on the services to be provided and are negotiated on a case-by-case basis. The revenue for the one-time customization fee is recognized on delivery and customer acceptance. The warranty is amortized over the contract period. The customers are involved in a wide variety of industries, including construction, labor management, entertainment, property management and so on. These companies from different industries are moving towards digitalization with the help of the system customization and development services. Sancaijia and its subsidiaries are proud to achieve their goal and fulfill Sancaijia s mission step by step. Discontinued Business - Rental Property Subleasing and Smart Locks Distribution Prior to December 2020, Sancai Real Estate Management Co., Ltd., a then subsidiary of Sancaijia, leased residential properties from individual property owners on a long-term basis, renovated and furnished such properties in a clean and modern manner, and rented them out to individual tenants. As of June 30, 2019, Sancai Real Estate Management Co., Ltd. leased an aggregate 11,434 properties from property owners. On July 1, 2019, Sancai Real Estate Management Co., Ltd. sold and transferred leases for 10,167 of these properties to City Community Service Group Co. Ltd. of Xian for a total of $18.93 million. The price was determined based on the valuation provided by Guangzhou Taizhi Asset Appraisal Firm, a national registered and licensed appraisal firm, in its rental property assessment report, using a 10% compounding rate to discount the future cash flow of each of the rental properties. For a period from late 2019 to December 2020, Sancai Real Estate Management Co., Ltd. also engaged in the distribution of smart locks for residential properties and offices as an added value for the corporate customers that subscribe to the SaaS platform application. The large amount of smart locks Sancai Real Estate Management Co., Ltd. purchased allowed it to negotiate a lower price for the corporate customers. The smart locks were connected to the SaaS platform so that the corporate customers can control the locks. 2 On December 10, 2020, Sancaijia entered into an equity transfer agreement, to sell 100% of the equity interest it held in Sancai Real Estate Management Co., Ltd., which operated subleasing business, to Sancai Group Co., Ltd., a former related party of Sancai Holding, for a total of approximately $3.42 million (RMB 22.33 million ). The transaction was closed on December 28, 2020. Mr. Ning Wen, the Chairman of the Board of Directors and Chief Executive Officer of Sancai Holding, was the legal representative and a majority shareholder of Sancai Group Co., Ltd. As Sancaijia shifted its operating strategy to focus on SaaS platform development and related technical service, on December 8, 2020, Mr. Ning Wen sold his all of his ownership interest of Sancai Group Co., Ltd. to a non-related party and resigned as legal representative. Since then, Sancai Group Co., Ltd. has been controlled by a non-related party. As a result of the disposal of Sancai Real Estate Management Co., Ltd., the smart lock business and the rental property subleasing business were discontinued in December 2020. Historical results are not necessarily indicative of the results that may be expected for any future period. Impact of the COVID-19 Pandemic On January 30, 2020, the World Health Organization declared the outbreak of the corona-virus disease (COVID-19) a "Public Health Emergency of International Concern," and on March 11, 2020, the World Health Organization characterized the outbreak as a "pandemic." Revenue from SaaS platform standard service during the fiscal year 2021 and 2020 was mainly from rental property leasing transactions. The customers of SaaS platform are corporate customers, mainly located in Xi'an, Shenzhen, Beijing, Shanghai, Chongqing, and cities in Hainan and Henan province, who rent their individual clients properties across China, which are entrusted to such corporate customers for management, to tenants through the SaaS platform. Although the employees and operations of the VIE and its subsidiaries are mostly located in Xi an, Shaanxi Province , the customers and the customers clients are not concentrated in particular geographic regions in China. The number of new leasing transactions decreased in the first calendar quarter of 2020 (corresponding with the second fiscal quarter for fiscal year 2020) as an immediate result of the lockdowns and travel restrictions in China in response to the COVID-19 pandemic. In the second calendar quarter of 2020 (corresponding with the third fiscal quarter for fiscal year 2020), as many cities eased the travel restrictions, the trading volume temporarily rebounded and increased. However, the frequent outbreak of the pandemic in many areas of China has caused the authorities to implement numerous measures in the third calendar quarter of 2020 (corresponding with the fourth fiscal quarter for fiscal year 2020) to try to contain the disease and slow its spread. These include travel bans and restrictions, quarantines, shelter-in-place orders, shutdowns and temporary lockdown of cities. The impact of the COVID-19 pandemic become apparent after such additional measures were taken during the third calendar quarter of 2020 (corresponding with the fourth fiscal quarter for fiscal year 2020) and such impact continued until today. Many cities have experienced lockdowns from time to time. The lockdowns might have been placed on a small population of people at a time, but inter-city and inter-province travelling have also been monitored and controlled, which affect almost all people across China. Based on the research conducted by rental agency in China, the rental demand of migrant population usually accounts for more than 50% of the rental market, which is the mainstream of market demand. The restrictions on travel and lockdowns have reduced the travel and migration of people, which reduced the market demand of house rental in China. The COVID-19 pandemic also changed people's lifestyle and spending habits. In addition, increase in wages, maintenance on empty rental houses and rental expenses, and caused many real estate leasing companies in China to shut down. Recently, there were many Covid-19 outbreaks cross the mainland of China. China s "Zero-Covid" policy mainly relies on mass testing, snap lockdowns and border curbs which has caused ad-hoc disruption to logistics and increase in costs of transportation and warehousing. Recently, new COVID-19 cases were detected across China, Xi an was lockdown from December 22, 2021 to January 24, 2022. All the residents were required to quarantine at home and were not allowed to leave their homes. New rounds of mass testing have also been conducted in cities across China. Many of the customers of the VIE and its subsidiaries are property leasing companies and agents and do not actual own the rental properties. The decrease in the demand for rental housing resulted in decrease of such customers revenue while their costs associated with employees and rental and maintenance of the property remain. Many of customers of the VIE and its subsidiaries and other the property leasing companies and agents in China went out of business in 2020 and 2021. The business operations and financial condition of the VIE and the VIE s subsidiaries have been materially and adversely affected as a result of the deteriorating market outlook, the slowdown in regional and national economic growth, weakened liquidity and financial conditions of the customers or other factors that we cannot foresee. As the VIE and the VIE s subsidiaries used to mainly promote the SaaS platform standard services in the rental property leasing industry and because the transactions processed through the platform decreased, the revenue from the SaaS platform standard services decreased, which significantly impacted the business of the VIE and the VIE s subsidiaries. During fiscal year 2021, the transaction amount settled though SaaS platform decreased by $204.34 million, from $212.36 million for the fiscal year 2020 to $8.02 million for the fiscal year 2021. Revenue from SaaS Platform standard service for fiscal year 2021 was mainly from contract liabilities recorded in fiscal year 2020 for unrealized revenue. There were no transactions processed through the SaaS platform after December 2020. During the six months ended March 31, 2022 and during the period from April 1, 2022 to the date of this prospectus, no transactions were settled through SaaS platform and there was no revenue from the standard SaaS platform application services. As there were no contract liabilities as of September 30, 2021 or March 31, 2022, Sancaijia does not expect any revenue from unrealized SaaS platform standard services in fiscal year 2022. The VIE and its subsidiaries believe that the "Zero-Covid" policy and the snap lockdowns will continue to have a negative impact on migration, tourism and travel and the real estate rental industry. In addition, because the transactions processed through the SaaS platform decreased, Sancaijia decided in that it was not economic to continue promoting the SaaS platform services in the real estate rental industry and reduced the promotion of the SaaS platform standard service in the rental property leasing industry at the beginning of 2021. The VIE and its subsidiaries are carefully exploring new industries for the application of SaaS platform. The continuation of any of these factors and other factors beyond our control could have any additional adverse effect on the overall business environment, cause uncertainties in the regions where the VIE and the VIE s subsidiaries conduct business, cause the business to suffer in ways that we cannot predict and materially and adversely impact the business, financial condition and results of operations of the VIE and the VIE s subsidiaries. 3 The VIE and the VIE s subsidiaries have made and are continuing to make efforts to improve the quality of service to the customers. During the lock down period, The VIE and the VIE s subsidiaries encouraged employees to work at home to ensure their safety. As the travel restrictions continue, in an effort to mitigate the impact of the Covid-19 pandemic in the real estate leasing industry, Sancaijia has accelerated the development of SaaS platform in other industries, especially in the agriculture industry and related consumer services, to diversify the source of revenue. Sancaijia has substantially completed the development of the SaaS platform application for the agriculture industry, including designing and coding, etc. Sancaijia and its subsidiaries have completed the preliminary tests based on simulated business data. Further changes will be made accordingly to the actual operating conditions and the expectations and demands from future customers. The current development stage does not require heavy research and development investment, so the decrease in research and development staff will not impact the progress. Once Sancaijia launches the marketing of the SaaS platform application in the agriculture industry, Sancaijia expects the research and development and marketing costs to increase. Sancaijia has not started marketing the SaaS platform application in the agriculture industry and plans to continue observing the development of the COVID-19 pandemic and China s "Zero-Covid" policy because the frequent outbreaks of the COVID-19 pandemic in China have impacted and will continue to impact the transportation and sales of agricultural products in China. The agriculture industry relies heavily on logistics. Small to medium business in the agriculture industry are especially sensitive to increase in costs. Nevertheless, recently, China has eased oversea visitors travel restrictions, reducing the required quarantine days from 14 days centralized quarantine and 7 days home quarantine to 7 days centralized quarantine and 3 days home quarantine and allowing people who hold APEC business travel cards and student visas to travel to China. According to the Chinese National Health Commission, as of August 9, 2022, 89.96% of the Chinese population have taken a full course of Covid-19 vaccines. On February 11, 2022, the Chinese State Food and Drug Administration approved the importation of Pfizer's Covid-19 treatment drug naimatevir tablets/ritonavir with conditions. Experts at the Academician of Chinese Academy of Sciences of Lanzhou University of China forecasted that Covid-19 pandemic would be to be under control in China by November 2023. Sancaijia expects to apply the system in agriculture industry in 2023 once the COVID-19 pandemic is under control. In addition, Sancaijia and its subsidiaries have made use of the existing SaaS platform technology and research and development capabilities and experience and focused on SaaS platform customization and development to maintain profitability. However, it is difficult to predict the development of the COVID-19 pandemic. Sancaijia cannot provide a specific timeframe for when it expects any substantial contribution to Sancaijia's revenues from the application of the SaaS platform in the agriculture industry. As Sancaijia does not expect any revenue from the SaaS platform standard service in the near future, Sancaijia s revenue and profitability currently solely relies on Sancaijia s SaaS platform customization and development service. The revenue and profitability may reduce further if Sancaijia and Sancaijia s subsidiaries cannot increase the sales from the SaaS platform customization and development services or apply the SaaS Platform standard services to different industries. The extent to which the COVID-19 pandemic impacts the results of the VIE and the VIE s subsidiaries will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the COVID-19 pandemic and the actions to contain or treat its impact, among others. Corporate Information and Structure The principal executive office of Sancaijia is located No. 6 Fengcheng Second Road, Room 401, Xi an Economic and Technological Development Zone, Xi an, Shaanxi Province, People s Republic of China 710000. The telephone number of the principal executive offices of Sancaijia is +86-029-62331099. The registered office of Sancai Holding is at Sertus Incorporations (Cayman) Limited, Sertus Chambers, Governors Square, Suite # 5-204, 23 Lime Tree Bay Avenue, P.O. Box 2547, Grand Cayman, KY1-1104, Cayman Islands. The agent of service of Sancai Holding in the United States is Cogency Global Inc., 122 E 42nd St 18th Fl, New York, NY 10168. Sancaijia maintains a website at www.sancaijia.com. We do not incorporate the information on the website into this prospectus and you should not consider any information on, or that can be accessed through, the website as part of this prospectus. 4 Sancai Holding does not have any material operation. The VIE and the VIE s subsidiaries conduct business in China. The following diagram illustrates our corporate structure as of the date of this prospectus and upon completion of this offering based on [ ] Class A Ordinary Shares being offered. The Pre-Offering percentages are calculated based on the 11,500,000 Ordinary Shares issued and outstanding, consisting of 10,000,000 Class A Ordinary Shares having an aggregate of 10,000,000 votes and 1,500,000 Class B Ordinary Shares having an aggregate of 15,000,000 votes. Ordinary Shares outstanding as of the date of this prospectus, and the Post-Offering percentages are calculated based on the [ ] Ordinary Shares outstanding immediately upon the completion of the offering, including [ ] Class A Ordinary Shares and 1,500,000 Class B Ordinary Shares. For more detail on our corporate history please refer to "Corporate History and Structure" and "Security Ownership of Certain Beneficial Owners and Management." In July 2019, we incorporated Sancai Holding, an exempted company under the laws of the Cayman Islands, as our offshore holding company to facilitate financing and offshore listing. Sancai Holding does not have any material operation. Sancaijia and its subsidiaries conduct business in China. The financial information of Sancaijia and its subsidiaries are consolidated into our financial statements for accounting purposes. Mr. Ning Wen, the Chairman of our Board of Directors and Chief Executive Officer, owns 63% of Sancaijia. The remaining equity of Sancaijia is beneficially owned by Lizhi He (20%), Lizhen Tang (13%) and Zhijie Zhang (4%). Mr. Wen also beneficially owns 6,300,000 (63.0%) and 1,000,000 (66.7%) of our outstanding Class A Ordinary Shares and Class B Ordinary Shares, respectively, indirectly through Fancy Dream Limited. Mr. Lizhi He beneficially owns 2,000,000 (20.0%) of our outstanding Class A Ordinary Shares and none of our outstanding Class B Ordinary Shares, respectively, indirectly through Lucky Bunny Limited. Mr. Lizhen Tang beneficially owns 1,300,000 (13.0%) and 500,000 (33.3%) of our outstanding Class A Ordinary Shares and Class B Ordinary Shares, respectively, indirectly through Superexcellence Limited. Mr. Zhang beneficially owns 400,000 (4%) of our outstanding Class A Ordinary and none of our outstanding Class B Ordinary Shares, respectively, indirectly through indirectly through Hippogriff Limited. Messrs. Wen, He, Tang and Zhang collectively hold 100% of the voting power of our current outstanding Ordinary Shares as of the date of this prospectus. Mr. Lizhen Tang is an employee of Sancaijia. Messrs. Lizhi He and Zhijie Zhang have no relationship with Sancai Holding, its subsidiaries, Sancaijia or Sancaijia s subsidiaries, or any affiliates thereof. See "Security Ownership of Certain Beneficial Owners and Management." The Class A Ordinary Shares offered in this prospectus are those of Sancai Holding, instead of shares of the VIE or its subsidiaries in China. You are not directly investing in and may never hold equity interests in the VIE in China. 5 Contractual Arrangements between Sancai WFOE, Sancaijia and its Shareholders Current PRC laws and regulations impose certain restrictions or prohibitions on foreign ownership of companies that engage in value-added telecommunication services and certain other businesses. Sancai Holding is a company incorporated in the Cayman Islands. Sancai WFOE, an indirect subsidiary of Sancai Holding established under the laws of the PRC, is considered a foreign-invested enterprise. To comply with PRC laws and regulations, in February 2020, Sancai WFOE entered into a series of contractual arrangements with Sancaijia and its shareholders. We have evaluated the guidance in FASB ASC 810 and determined that Sancai WFOE is the primary beneficiary of Sancaijia, for accounting purposes, based upon such contractual arrangements. Sancai Holding has indirect ownership in 100% of the equity in Sancai WFOE. As a result, we treat Sancaijia and its subsidiaries as consolidated affiliated entities under the U.S. GAAP and have consolidated the financial results of these entities in our consolidated financial statements in accordance with U.S. GAAP. For a description of our corporate structure and VIE contractual arrangements, see "Corporate History and Structure – Contractual Arrangements between Sancai WFOE, Sancaijia and its Shareholders" starting on page 77, which consist of (i) Exclusive Technical Consultation and Service Agreement, as amended and restated, (ii) Exclusive Call Option Agreements, (iii) Business Operation Agreement, (iv) Equity Pledge Agreement, (v) Shareholder Voting Proxy Agreement, and (vi) Spousal Consent Letter. See "Risk Factors—Risks Related to Our Corporate Structure" for certain risks related to the contractual arrangements. In the opinion of Guangdong Shouzhuo Law Firm, our PRC legal counsel, the contractual arrangements among Sancai WFOE, Sancaijia and its shareholders governed by PRC law are valid, binding and enforceable, and will not result in any violation of applicable PRC laws and regulations currently in effect. However, the VIE structure involves unique risks to investors. We have been advised by Guangdong Shouzhuo Law Firm, our PRC legal counsel, that there are substantial uncertainties regarding the interpretation and application of current and future PRC laws, regulations and rules. The VIE Agreements have not been tested in a court of law. The PRC regulatory authorities may in the future take a view that is contrary to the above opinion of our PRC legal counsel, Guangdong Shouzhuo Law Firm. It is uncertain whether any new PRC laws or regulations relating to the VIE structures will be adopted or if adopted, what they would provide. If we or Sancaijia is found to be in violation of any existing or future PRC laws or regulations, or fail to obtain or maintain any of the required permits or approvals, the relevant PRC regulatory authorities would have broad discretion to take action in dealing with such violations or failures. In the event we are unable to enforce these VIE Agreements or if the PRC regulatory authorities disallow the VIE structure, we may be precluded from consolidating the financial information of Sancaijia and its subsidiaries into our financial statements for accounting purposes, which would have a material adverse effect on the financial condition and results of operations of the VIE and the VIE s subsidiaries and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless. Additionally, these VIE Agreements are less effective than direct ownership and that we may incur substantial costs to enforce the VIE Agreements. For example, Sancaijia and its shareholders could breach the VIE Agreements with us by, among other things, failing to conduct their operations in an acceptable manner or taking other actions that are detrimental to our interests. If we had direct ownership of Sancaijia, we would be able to exercise our rights as a shareholder to effect changes in the board of directors of Sancaijia, which in turn could implement changes, subject to any applicable fiduciary obligations, at the management and operational level. However, under the current VIE Agreements, we rely on Sancaijia and its shareholders to perform their obligations under the contracts. The shareholders of Sancaijia may not act in the best interests of our Company or may not perform their obligations under these contracts. In addition, failure of Sancaijia s shareholders to perform certain obligations could compel us to rely on legal remedies available under PRC laws, including seeking specific performance or injunctive relief, and claiming damages, which may not be effective. In addition, there is uncertainty as to whether the courts of the Cayman Islands or the PRC would recognize or enforce judgments of U.S. courts against Sancai Holding or such persons predicated upon the civil liability provisions of the securities laws of the United States or any state. See "Risk Factors—Risks Related to Our Corporate Structure—Sancai Holding is a holding company with no material operation. Sancai WFOE entered into the VIE Agreements with Sancaijia, the consolidated variable interest entity, and its shareholders that established the VIE structure. Sancaijia and its subsidiaries conduct business in China. If the PRC government deems that the VIE structure do not comply with PRC regulatory restrictions on foreign investment in the relevant industries, or if these regulations or the interpretation of existing regulations change in the future, we would not be able to enforce the VIE Agreements and could be subject to severe penalties or be forced to relinquish our interests in those operations" and "Risk Factors — Risks Related to Doing Business in China — The rules and regulations and the enforcement thereof in China can change quickly with little advance notice. The Chinese government recently promulgated a number of laws, regulations and policies that focus on tightening oversight of data security and overseas equity fundraising and listing by Chinese companies. Such uncertainties with respect to the PRC legal system, including uncertainties regarding the enforcement of laws, and sudden or unexpected changes in laws and regulations in China could adversely affect us and limit the legal protections available to you and us. The Chinese government may intervene or influence the operations of the VIE or the VIE s subsidiaries at any time, or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in the operations of the VIE and the VIE s subsidiaries and in the value of our Class A Ordinary Shares or significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless." The following is a summary of the currently effective contractual arrangements by and among Sancai WFOE, Sancaijia and the shareholders of the VIE and their spouses, as applicable. Business Operation Agreement. Pursuant to the Business Operation Agreement entered into among Sancai WFOE, Sancaijia and the shareholders of Sancaijia (hereinafter referred to individually as a "Shareholder" and collectively as the "VIE Shareholders"), dated February 25, 2020, the VIE Shareholders agreed that without the prior written consent of Sancai WFOE or any party designated by Sancai WFOE, Sancaijia shall not engage in any transaction which may have a material or adverse effect on any of its assets, businesses, employees, obligations, rights or operations (except for those occurring in the due course of business or in day-to-day business operations, or those already disclosed to Sancai WFOE and with the explicit prior written consent of Sancai WFOE). In addition, Sancaijia and the VIE Shareholders jointly agreed to accept and strictly implement any proposal made by Sancai WFOE from time to time regarding the employment and removal of Sancaijia s employees, its day-to-day business management and the financial management system of Sancaijia. This Business Operation Agreement shall become effective upon execution by Sancai WFOE, Sancaijia and the VIE Shareholders, and shall remain valid until it is terminated by written agreement of the Parties. During the term of the Business Operation Agreement, neither Sancaijia nor the VIE Shareholders may terminate the Business Operation Agreement. Sancai WFOE shall have the sole right to terminate the Business Operation Agreement at any time, provided that Sancai WFOE gives prior written notice of thirty (30) days to Sancaijia and the VIE Shareholders. In addition, Sancai WFOE, Sancaijia and the VIE Shareholders may terminate the Business Operation Agreement as they unanimously agree through negotiation. 6 Shareholder Voting Proxy Agreement. Pursuant to the Shareholders Voting Rights Proxy Agreement among Sancai WFOE, Sancaijia and the VIE Shareholders, dated February 25, 2020, each Shareholder irrevocably authorizes Sancai WFOE or any person(s) designated by Sancai WFOE to act as its attorney-in-fact to exercise all of its rights as a shareholder of Sancaijia, including, but not limited to, the right to convene shareholders meetings, vote and sign any resolution as a shareholder, appoint directors and other senior executives to be appointed and removed by the shareholder, the right to sell, transfer, pledge and dispose of all or a portion of the shares held by such shareholder, and other shareholders voting rights permitted by the articles of association of Sancaijia. Unless terminated early by the parties by written agreement, this agreement shall remain valid for ten (10) years. During the term of the Shareholders Voting Rights Proxy Agreement, unless otherwise stipulated by law, the VIE Shareholders or Sancaijia shall not early terminate this Agreement. Sancai WFOE may at any time terminate this agreement with a written notice being given to other parties thirty (30) days in advance. In addition, in the case that a Shareholder becomes the defaulting party who materially breaches any provision or materially fails to perform any obligation under this agreement, Sancai WFOE shall be entitled to terminate this agreement. Upon the expiration of this agreement, unless Sancai WFOE gives a non-renewal written notice to Sancaijia and the VIE Shareholders thirty (30) days prior to the expiration, this agreement shall be renewed automatically for successive ten (10)-year terms. Equity Pledge Agreement. Pursuant to the Equity Pledge Agreement entered into among Sancai WFOE, Sancaijia and the VIE Shareholders dated February 25, 2020, the VIE Shareholders agreed to pledge their 100% equity interests in Sancaijia to Sancai WFOE to secure the performance of Sancaijia s obligations under the existing exclusive call option agreement, shareholder voting proxy agreements, exclusive technical consultation and service agreement, as amended and restated, business operation agreement and also the equity pledge agreement. If events of default defined therein occur, upon giving written notice to the VIE Shareholders, Sancai WFOE may exercise the right to enforce the pledge to the extent permitted by PRC laws. This agreement shall come into effect upon execution by each of the parties and the term of this agreement shall end upon the full performance of the Contractual Obligations or the full discharge of the Secured Liabilities defined under this agreement. As of the date of this prospectus, all the VIE Shareholders have completed the equity pledge registration with the competent Administration for Market Regulation in accordance with the PRC Property Rights Law. Spousal Consent Letter. Pursuant to a series of Spousal Consent Letters, executed by the spouses of the VIE Shareholders, Mr. Ning Wen, Mr. Lizhi He and Mr. Zhijie Zhang, dated February 25, 2020, the signing spouses confirmed and agreed that the equity interests of Sancaijia are the own property of their spouses and shall not constitute the community property of the couples. The spouses also irrevocably waived any potential right or interest that may be granted by operation of applicable law in connection with the equity interests of Sancaijia held by their spouses. Exclusive Technical Consultation and Service Agreement. Pursuant to the Exclusive Technical Consultation and Service Agreement entered into between Sancai WFOE and Sancaijia dated February 25, 2020, as amended and restated on June 28, 2022, Sancai WFOE has the exclusive right to provide or designate any entity to provide with Sancaijia business support, technical and consulting services. Sancaijia agrees to pay Sancai WFOE (i) the service fees equal to the sum of 100% of Sancaijia s net income of that year, which equals the balance of the gross income less the costs of Sancaijia acceptable to Sancai WFOE and Sancaijia, or such other amount otherwise agreed by Sancai WFOE and Sancaijia. and (ii) service fees otherwise confirmed by Sancai WFOE and Sancaijia for specific technical services and consulting services provided by Sancai WFOE in accordance with Sancaijia s requirement from time to time. The Exclusive Consultation and Service Agreement will continue to be valid unless the written agreement is signed by all parties to terminate it or a mandatory termination is requested in accordance with applicable PRC laws and regulations. Sancai WFOE is entitled to unilaterally exercise immediate early termination of the Exclusive Technical Consultation and Service Agreement by sending a written notice to Sancaijia if any of the following events were to occur: (i) Sancaijia breaches this agreement, and within thirty (30) days after Sancai WFOE sends out a written notice of breach to Sancaijia, Sancaijia fails to rectify its breach, take sufficient, effective and timely measures to eliminate the effects of breach and compensate Sancai WFOE for any losses incurred by the breach; (ii) Sancaijia is bankrupt or is subject to any liquidation procedure and such procedure is not revoked within seven (7) days; and (iii) due to any event of force majeure, Sancaijia s failure to perform this agreement lasts for more than twenty (20) days. Exclusive Call Option Agreements. Pursuant to the Exclusive Call Option Agreement entered into among Sancai WFOE, Sancaijia and the VIE Shareholders, dated February 25, 2020, each VIE Shareholder has irrevocably granted Sancai WFOE an exclusive option to purchase all or part of its equity interests in Sancaijia, and Sancaijia has irrevocably granted Sancai WFOE an exclusive option to purchase all or part of its assets. With regard to the equity transfer option, the total transfer price to be paid by Sancai WFOE or any other entity or individual designated by Sancai WFOE for exercising such option shall be the capital contribution mirrored by the corresponding transferred equity in the registered capital of Sancaijia. But if the lowest price permitted by the then-effective PRC law is lower than the above capital contribution, the transfer price shall be the lowest price permitted by the PRC law. With regard to the asset purchase option, the transfer price to be paid by Sancai WFOE or any other entity or individual designated by Sancai WFOE for exercising such option shall be the lowest price permitted by the then-effective PRC law. The Exclusive Call Option Agreement shall terminate after all the Shareholder Equity and the Company Assets, which are defined under this agreement, are lawfully transferred to Sancai WFOE and/or any other entity or individual designated by Sancai WFOE pursuant to the provisions of this agreement. In addition, in the case that a Shareholder or Sancaijia becomes the defaulting party who substantially violates any agreement or substantially fails to perform or delays performance of any of the obligations under this agreement, Sancai WFOE shall be entitled to terminate this agreement. Recent Regulatory Developments in China Recently, the PRC government has indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, and initiated a series of regulatory actions and made a number of public statements on the regulation of business operations in China, some of which are published with little advance notice, including: taking significant, immediate regulatory action against what it determined were illegal activities in the securities market, enhancing supervision over China-based companies listed overseas, adopting new measures to extend the scope of cybersecurity reviews, and expanding efforts in anti-monopoly enforcement. 7 Among other things, the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (the "M&A Rules") and Anti-Monopoly Law of the People s Republic of China promulgated by the SCNPC which became effective in 2008 ("Anti-Monopoly Law"), established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time-consuming and complex. Such regulation requires, among other things, that State Administration for Market Regulation ("SAMR") be notified in advance of any change-of-control transaction in which a foreign investor acquires control of a PRC domestic enterprise or a foreign company with substantial PRC operations, if certain thresholds under the Provisions of the State Council on the Standard for Declaration of Concentration of Business Operators, issued by the State Council in 2008, are triggered. Moreover, the Anti-Monopoly Law requires that transactions which involve the national security, the examination on the national security shall also be conducted according to the relevant provisions of the State. In addition, the PRC Measures for the Security Review of Foreign Investment which became effective in January 2021 require acquisitions by foreign investors of PRC companies engaged in military-related or certain other industries that are crucial to national security be subject to security review before consummation of any such acquisition. On July 6, 2021, the relevant PRC government authorities made public the Opinions on Strictly Cracking Down Illegal Securities Activities in Accordance with the Law. These opinions emphasized the need to strengthen the administration over illegal securities activities and the supervision on overseas listings by China-based companies and proposed to take effective measures, such as promoting the construction of relevant regulatory systems to deal with the risks and incidents faced by China-based overseas-listed companies. As these opinions are recently issued, official guidance and related implementation rules have not been issued yet and the interpretation of these opinions remains unclear at this stage. See "Risk Factors — Risks Related to Doing Business in China — The approval of the CSRC may be required in connection with this offering, and, if required, we cannot predict whether we or the VIE or the VIE s subsidiaries will be able to obtain such approval. Any requirement to obtain prior approval under the M&A Rules and/or any other regulations promulgated by relevant PRC regulatory agencies in the future could delay this offering and failure to obtain any such approvals, if required, could have a material adverse effect on the business, operating results and reputation of the VIE or the VIE s subsidiaries as well as the trading price of our Class A Ordinary Shares, and could also create uncertainties for this offering." In addition, on July 10, 2021, the Cyberspace Administration of China ("CAC") issued the Measures for Cybersecurity Review for public comments ("Draft Measures"), which propose to authorize the relevant government authorities to conduct cybersecurity review on a range of activities that affect or may affect national security, including listings in foreign countries by companies that possess the personal data of more than one million users. The Draft Measures are subject to change. As the VIE and the VIE s subsidiaries are neither an "critical information infrastructure operator (CIIO)," nor a "data processor" carrying out data processing activities that affect or may affect national security, we believe that the Draft Measures are not applicable to us even after they take effect in current form. On January 4, 2022, thirteen PRC regulatory agencies, namely, the CAC, the NDRC, the Ministry of Industry and Information Technology, the Ministry of Public Security, the Ministry of State Security, the Ministry of Finance, MOFCOM, SAMR, CSRC, the People s Bank of China, the National Radio and Television Administration, National Administration of State Secrets Protection and the National Cryptography Administration, jointly adopted and published the Measures for Cybersecurity Review (2021), which became effective on February 15, 2022. The Measures for Cybersecurity Review (2021) required that, among others, in addition to CIIO any "operator of network platform" holding personal information of more than one million users which seeks to list in a foreign stock exchange should also be subject to cybersecurity review. In addition, on November 14, 2021, the CAC released the Regulations on Network Data Security (draft for public comments), or the draft Regulations on Network Data Security, and will accept public comments until December 13, 2021. According to the draft Regulations on Network Data Security, if a data processor that processes personal data of more than one million users intends to list overseas, it shall apply for a cybersecurity review. In addition, data processors that process important data or are listed overseas shall carry out an annual data security assessment on their own or by engaging a data security services institution, and the data security assessment report for the prior year should be submitted to the local cyberspace affairs administration department before January 31 of each year. On July 7, 2022, the CAC promulgated the Measures on Security Assessment of Outbound Data Transfer, or the Outbound Data Transfer Security Assessment Measures, which became effective on September 1, 2022. According to the Outbound Data Transfer Security Assessment Measures, to provide data abroad under any of the following circumstances, a data processor shall declare security assessment for its outbound data transfer to the CAC through the local cyberspace administration at the provincial level: (i) where the data processor will provide important data abroad; (ii) where CIIO or the data processor processing the personal information of more than one million individuals will provide personal information abroad; (iii) where the data processor who has provided personal information of 100,000 individuals or sensitive personal information of 10,000 individuals in total abroad since January 1 of the previous year, will provide personal information abroad; and (iv) other circumstances where the security assessment is required as prescribed by the CAC. Prior to declaring security assessment for outbound data transfer, the data processor shall conduct self-assessment on the risks of the outbound data transfer. For outbound data transfers that have been carried out before the effectiveness of the Outbound Data Transfer Security Assessment Measures, if it is not in compliance with these measures, rectification shall be completed within six months starting from September 1, 2022. Since the Outbound Data Transfer Security Assessment Measures is extremely new, there remain substantial uncertainties about its interpretation and implementation, and it is unclear whether we shall declare a security assessment. The PRC government is increasingly focused on data security, recently launching cybersecurity review against a number of mobile apps operated by several US-listed Chinese companies and prohibiting these apps from registering new users during the review period. There are great uncertainties regarding the interpretation and enforcement of PRC laws, rules and regulations regarding data and privacy security. The VIE and the VIE s subsidiaries may be required to change the data and other business practices and be subject to regulatory investigations, penalties, and increased cost of operations as a result of these laws and policies. 8 On December 24, 2021, the CSRC released the Administrative Provisions of the State Council Regarding the Overseas Issuance and Listing of Securities by Domestic Enterprises (Draft for Comments) (the "Draft Administrative Provisions") and the Measures for the Overseas Issuance of Securities and Listing Record-Filings by Domestic Enterprises (Draft for Comments) (the "Draft Filing Measures," collectively with the Draft Administrative Provisions, the "Draft Rules Regarding Overseas Listing"), both of which are currently published for public comments only. The Draft Rules Regarding Overseas Listing lay out the filing regulation arrangement for both direct and indirect overseas listing, and clarify the determination criteria for indirect overseas listing in overseas markets. Among other things, if a domestic enterprise intends to indirectly offer and list securities in an overseas market, the record-filing obligation is with a major operating entity incorporated in the PRC and such filing obligation shall be completed within three working days after the overseas listing application is submitted. The required filing materials for an initial public offering and listing shall include but not limited to: regulatory opinions, record-filing, approval and other documents issued by competent regulatory authorities of relevant industries (if applicable); and security assessment opinion issued by relevant regulatory authorities (if applicable). Furthermore, if the CSRC or other regulatory agencies later promulgate new rules or explanations requiring that we or the VIE and the VIE s subsidiaries obtain their approvals for this offering and any follow-on offering, we or the VIE and the VIE s subsidiaries may be unable to obtain such approvals and we or the VIE and the VIE s subsidiaries may face sanctions by the CSRC or other PRC regulatory agencies for failure to seek such approvals which could significantly limit or completely hinder our ability to offer or continue to offer securities to our investors and the securities currently being offered may substantially decline in value and be worthless. See "Risk Factors—Risks Related to Doing Business in China—The rules and regulations and the enforcement thereof in China can change quickly with little advance notice. The Chinese government recently promulgated a number of laws, regulations and policies that focus on tightening oversight of data security and overseas equity fundraising and listing by Chinese companies. Such uncertainties with respect to the PRC legal system, including uncertainties regarding the enforcement of laws, and sudden or unexpected changes in laws and regulations in China could adversely affect us and limit the legal protections available to you and us. The Chinese government may intervene or influence the operations of the VIE or the VIE s subsidiaries at any time, or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in the operations of the VIE and the VIE s subsidiaries and in the value of the Class A Ordinary Shares or significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless." Regulatory Permissions As of the date of this prospectus, each of the Company, its subsidiaries, the VIE and the VIE s subsidiaries has obtained all permissions and approvals to operate their respective business, including business license, permit for opening bank account, labor and employment recordation, social insurance registration, internet content provide registration record and such other permissions and approval as required by the PRC regulatory authorities. Besides, the registered business scopes of Sancaijia and Xi an Miaobijia both currently include the second category of value-added telecommunications services (VATS) as defined in the PRC Regulations on Telecommunications and the Classified Catalog of Telecommunications Services. According to PRC regulations relating to VATS, any commercial internet information services operators with the business scope of internet information services shall obtain a ICP License, and any commercial internet information services operators with the business scope of online data processing and transaction processing services shall obtain a EDI License, from the relevant government authorities before actually providing any commercial internet information services or online data processing and transaction processing services within the PRC. To comply with the relevant laws and regulations, Sancaijia has obtained the ICP and EDI Licenses on August 10, 2020, and Xi an Miaobijia has obtained the ICP and EDI Licenses on August 30, 2021. Neither have we nor our subsidiaries or the VIE or the VIE s subsidiaries received any denial of permissions for their operation. On August 8, 2006, six Chinese regulatory agencies, including the Ministry of Commerce of China ("MOFCOM"), jointly issued the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (the "M&A Rules"), which became effective on September 8, 2006 and amended on June 22, 2009. The M&A Rules contains provisions that require that an offshore special purpose vehicle ("SPV") formed for listing purposes and controlled directly or indirectly by Chinese companies or individuals shall obtain the approval of the CSRC prior to the listing and trading of such SPV s securities on an overseas stock exchange. On September 21, 2006, the CSRC published procedures specifying documents and materials required to be submitted to it by an SPV seeking CSRC approval of overseas listings. However, the application of the M&A Rule remains unclear with no consensus currently existing among leading Chinese law firms regarding the scope and applicability of the CSRC approval requirement. Based on the understanding of the current PRC law, rules and regulations, we believe the CSRC s approval is not required for the listing and trading of our Class A Ordinary Shares on Nasdaq in the context of this offering, given that: (i) Sancai WFOE was incorporated as a wholly foreign-owned enterprise by means of direct investment rather than by merger or acquisition of equity interest or assets of a PRC domestic company owned by PRC companies or individuals as defined under the M&A Rules that are our beneficial owners; (ii) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours under this prospectus are subject to the M&A Rules; and (iii) no provision in the M&A Rules clearly classifies contractual arrangements as a type of transaction subject to the M&A Rules. In addition, none of CSRC, CAC, or other authorities have set forth approval procedures specifically for the VIE and the VIE s subsidiaries, so we believe that we or the VIE and the VIE s subsidiaries do not need to apply to Chinese authorities for approving the VIE structure. However, we have been further advised by Guangdong Shouzhuo Law Firm, our PRC legal counsel, that the enforceability of the VIE agreements has not been tested in a court of law, and that the PRC regulatory authorities could disallow this VIE structure, which could significantly limit or completely hinder our ability to continue to offer securities to investors outside China and cause the value of our securities to significantly decline or become worthless. 9 In the future, the VIE and the VIE s subsidiaries may grow their business by acquiring complementary businesses. It is unclear whether the VIE and the VIE s subsidiaries would be deemed to be in an industry that raises "national defense and security" or "national security" concerns. However, the MOFCOM or other government agencies may publish explanations in the future determining that the business of the VIE or the VIE s subsidiaries is in an industry subject to the security review, in which case the future acquisitions in the PRC, including those by way of entering into contractual arrangements with target entities, may be closely scrutinized or prohibited. The ability to expand the business or maintain or expand the market share of the VIE or the VIE s subsidiaries through future acquisitions would as such be materially and adversely affected. Furthermore, according to the M&A Rules, if a PRC entity or individual plans to merge or acquire its related PRC entity through an overseas company legitimately incorporated or controlled by such entity or individual, such a merger and acquisition will be subject to examination and approval by the MOFCOM. There is a possibility that the PRC regulators may promulgate new rules or explanations requiring that we or the VIE or the VIE s subsidiaries obtain the approval of the MOFCOM or other PRC governmental authorities for the completed or ongoing mergers and acquisitions. There is no assurance that, if the VIE and the VIE s subsidiaries plan to make an acquisition, the VIE and the VIE s subsidiaries can obtain such approval from the MOFCOM or any other relevant PRC governmental authorities for the mergers and acquisitions, and if the VIE and the VIE s subsidiaries fail to obtain those approvals, the VIE and the VIE s subsidiaries may be required to suspend the acquisition and be subject to penalties. Any uncertainties regarding such approval requirements could have a material adverse effect on the VIE s and the VIE s subsidiaries business, results of operations and corporate structure. In addition, our PRC legal counsel, Guangdong Shouzhuo Law Firm, has advised us that, if any of the following circumstance exists, we, the VIE and the VIE s subsidiaries shall apply with the CAC for cybersecurity review with respect to this offering: (i) we, the VIE and the VIE s subsidiaries possess over one million individuals personal information; (ii) we, the VIE and the VIE s subsidiaries are deemed as CIIOs and intend to purchase internet products and services that will or may affect national security, and (iii) we, the VIE and the VIE s subsidiaries carry out any data processing activities which has affected or may affect national security. We believe we, the VIE and the VIE s subsidiaries have none of the aforesaid circumstances and do not expect to be subject to the cybersecurity review by the CAC for this offering, given that: (i) the products and services of the VIE and the VIE s subsidiaries are offered not directly to individual users but through the corporate customers of the VIE and the VIE s subsidiaries, and the VIE and the VIE s subsidiaries do not have access to the information of the customers of such corporate customers, which are stored at such corporate customers and can only be accessed by such corporate customers; (ii) the VIE and the VIE s subsidiaries do not possess any personal information of users in their business operations; and (iii) data processed in the VIE s and the VIE s subsidiaries business does not have a bearing on national security and thus may not be classified as core or important data by the authorities. The VIE and its subsidiaries operate the SaaS platform online and maintain the transactions and customers data on Alibaba Cloud. Alibaba Cloud has a comprehensive and systematic data security system of data management and uses technical measures based on the complete data security lifecycle. The architecture of the data management includes security modules of various layers, authentication, authorization, access control, and log auditing, etc., which provides a comprehensive cloud data security solution. All data stored on Alibaba Cloud is protected by strong customer isolation security and control capabilities of Alibaba Cloud. The VIE and its subsidiaries provide the SaaS platform for its customers to operate their own business. The customers of the VIE and its subsidiaries retain control, maintenance, and ownership of their own data, which is encrypted and stored in Alibaba Cloud. The VIE and its subsidiaries have no control of this data and have no authority to access the user information stored by its customers. The VIE and its subsidiaries only have access to data related to the operation and maintenance of the SaaS platform, which does not include data related with its customer s clients, or users. We do not believe the VIE and the VIE s subsidiaries are among the CIIO, "data processor" carrying out data processing activities that affect or may affect national security, or "operator of network platform" holding personal information of more than one million users as mentioned above. However, if the draft Regulations on Network Data Security is adopted into law and we become listed on Nasdaq, Sancai WFOE, the VIE and the VIE s subsidiaries likely will be required to perform annual data security assessment either by itself or retaining a third-party data security service provider and submit such data security assessment report to the local agency every year. Furthermore, the revised draft Regulations on Network Data Security is in the process of being formulated and subject to further changes, and inherent uncertainty exists in relying on an opinion of our PRC legal counsel, Guangdong Shouzhuo Law Firm, as to the enactment, interpretation and implementation of regulations related to overseas securities offerings and cybersecurity compliance requirements. The PRC regulators, including the CSRC or the CAC, may not arrive at the same conclusion as our PRC legal counsel, Guangdong Shouzhuo Law Firm. 10 As of the date of this prospectus, Sancai Holding, its subsidiaries, the VIE or the VIE s subsidiaries have not been involved in any investigations on cybersecurity or data security initiated by related governmental regulatory authorities, or received any penalty, investigation or warning in connection with the operations of the VIE and VIE s subsidiaries from the CAC or any other PRC regulatory agencies, or received any notice or instructions from the CAC requiring Sancai Holding, its PRC subsidiary, the VIE or the VIE s subsidiaries to declare a security assessment. If it is determined in the future that we are required to declare a security assessment, it is uncertain whether we can or how long it will take us to complete such declaration or rectification. However, the Measures for Cybersecurity Review (2021), draft Regulations on Network Data Security and Outbound Data Transfer Security Assessment Measures are relatively new, there are substantial uncertainties regarding their interpretation and application, and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the above regulations in the future. We cannot assure you that PRC regulatory agencies, including the CAC, would take the same view as we do, and there is no assurance that we or the VIE or the VIE s subsidiaries can fully or timely comply with such laws. In the event that the applicable laws, regulations, or interpretations change such that we or the VIE or the VIE s subsidiaries are subject to any mandatory cybersecurity review and other specific actions required by the CAC, we cannot guarantee whether we or the VIE or the VIE s subsidiaries can complete the registration process in a timely manner, or at all. Given such uncertainty, we or the VIE or the VIE s subsidiaries may be further required to suspend the relevant business, shut down the website, or face other penalties, which could materially and adversely affect the business, financial condition, results of operations of the VIE or the VIE s subsidiaries and the value of our Class A Ordinary Shares, significantly limit or completely hinder our ability to offer or continue to offer securities to investors, or cause such securities to significantly decline in value or become worthless. Furthermore, On December 24, 2021, the CSRC released the Draft Rules Regarding Overseas Listing, which are currently published for public comments only. The Draft Rules Regarding Overseas Listing lay out the filing regulation arrangement for both direct and indirect overseas listing, and clarify the determination criteria for indirect overseas listing in overseas markets. Among other things, if a domestic enterprise intends to indirectly offer and list securities in an overseas market, the record-filing obligation is with a major operating entity incorporated in the PRC and such filing obligation shall be completed within three working days after the overseas listing application is submitted. The required filing materials for an initial public offering and listing shall include but not limited to: regulatory opinions, record-filing, approval and other documents issued by competent regulatory authorities of relevant industries (if applicable); and security assessment opinion issued by relevant regulatory authorities (if applicable). In addition, overseas offerings and listings may be prohibited for such domestic enterprise when any of the following applies: (1) if the intended securities offerings and listings are specifically prohibited by the laws, regulations or provision of the PRC; (2) if the intended securities offerings and listings may constitute a threat to, or endanger national security as reviewed and determined by competent authorities under the State Council in accordance with laws; (3) if there are material ownership disputes over applicants equity interests, major assets, core technologies, or the others; (4) if, in the past three years, applicants domestic enterprises or controlling shareholders, de facto controllers have committed corruption, bribery, embezzlement, misappropriation of property, or other criminal offenses disruptive to the order of the socialist market economy, or are currently under judicial investigation for suspicion of criminal offenses, or are under investigation for suspicion of major violations; (5) if, in the past three years, any directors, supervisors, or senior executives of applicants have been subject to administrative punishments for severe violations, or are currently under judicial investigation for suspicion of criminal offenses, or are under investigation for suspicion of major violations; (6) other circumstances as prescribed by the State Council. We do not believe any of the six prohibited situations aforementioned applies to us. The Draft Administrative Provisions further stipulate that a fine between RMB 1 million and RMB 10 million may be imposed if an applicant fails to fulfil the filing requirements with the CSRC or conducts an overseas offering or listing in violation of the Draft Rules Regarding Overseas Listings, and in cases of severe violations, a parallel order to suspend relevant businesses or halt operations for rectification may be issued, and relevant business permits or operational license revoked. As of the date of this prospectus, considering that (i)the Draft Rules Regarding Overseas Listings have not been promulgated and have not come into effect; (ii) no explicit provisions under currently effective PRC laws, regulations and rules clearly classifies indirect listing through contractual arrangements like ours are required to obtain approvals from PRC authorities, we or the VIE or the VIE s subsidiaries have not been required to submit applications for the approval of the CSRC or other equivalent PRC government authorities for any offering pursuant to this prospectus according to currently effective PRC laws, regulations and rules at this stage. While the final version of the Draft Rules Regarding Overseas Listings are expected to be adopted in 2022, we believe that we or the VIE or the VIE s subsidiaries will be required to comply with the filing requirements or procedures set forth in the Draft Rules Regarding Overseas Listings and that none of the situations that would clearly prohibit overseas offering and listing applies to us. However, as the Draft Rules Regarding Overseas Listings have not been formally adopted and the Negative List (Edition 2021) was newly published, and due to the lack of further clarifications or detailed rules and regulations, our PRC legal counsel as to law, Guangdong Shouzhuo Law Firm, has further advised us that, there are still uncertainties as to how the aforementioned rules will be interpreted or implemented and whether the PRC regulatory agencies may adopt new laws, regulations, rules, or detailed implementation and interpretation and there is no assurance that PRC regulatory agencies, including the CSRC, would take the same view as they do. It should be noted however, that there is uncertainty in relying on an opinion of counsel in connection with draft legislation as the final version may be materially different and/or that the implementing regulations have yet to be promulgated. We cannot assure you that we, the VIE or the VIE s subsidiaries will be able to get the clearance of filing procedures under the Draft Rules Regarding Overseas List on a timely basis, or at all. There is also the possibility that we or the VIE or the VIE s subsidiaries may not be able to obtain or maintain such approval or that we inadvertently concluded that such approval was not required. If the CSRC requires that we, the VIE or the VIE s subsidiaries obtain its approval prior to the completion of this offering, the offering will be delayed until we, the VIE and the VIE s subsidiaries have obtained CSRC approval, which may take several months. Any failure of us to fully comply with new regulatory requirements may significantly limit or completely hinder our ability to continue to offer our Class A Ordinary Shares, cause significant disruption to the business operations, and severely damage the reputation of the VIE or the VIE s subsidiaries, which could materially and adversely affect the financial condition and results of operations of the VIE or the VIE s subsidiaries and cause our Class A Ordinary Shares to significantly decline in value or become worthless. 11 As of the date of this prospectus, no relevant laws or regulations in the PRC explicitly require us to seek approval from the CSRC or the CAC or any other PRC governmental authorities for this offering and/or list on the Nasdaq Stock Market, nor has we or the VIE or the VIE s subsidiaries received any inquiry, notice, warning or sanctions regarding our planned offering from the CSRC or any other PRC governmental authorities. Based on our understanding of the current PRC laws, regulations and rules, we believe that the Company, its subsidiaries, the VIE and the VIE s subsidiaries have received all permissions and approvals to operate their respective business and are not required to obtain additional permission or approval from Chinese authorities to issue these securities to foreign investors or list on the Nasdaq Stock Market based on the PRC laws, regulations and rules currently in effect. However, since these statements and regulatory actions are newly published, however, official guidance and related implementation rules have not been issued, we are subject to the risks of uncertainty of any future actions of the PRC government in this regard including the risk that we inadvertently conclude that the permissions or approvals discussed here are not required, that applicable laws, regulations or interpretations change such that we or the VIE or the VIE s subsidiaries are required to obtain approvals in the future, or that the PRC government could disallow our structure, which would likely result in a material change in the operations of the VIE and the VIE s subsidiaries, including the ability to continue the existing structure, carry on the daily business operations of the VIE and the VIE s subsidiaries, the VIE s ability to accept foreign investments, and our listing on an U.S. exchange. These adverse actions could cause the value of our Class A Ordinary Shares to significantly decline or become worthless. We or the VIE or the VIE s subsidiaries may also be subject to penalties and sanctions imposed by the PRC regulatory authorities, including the CSRC, if we or the VIE or the VIE s subsidiaries fail to comply with such rules and regulations, which would likely adversely affect the ability of our securities to be listed on a U.S. exchange, which would likely cause the value of our securities to significantly decline or become worthless. The Standing Committee of the National People s Congress (the "SCNPC") or PRC regulatory authorities may in the future promulgate laws, regulations, or implementing rules that require us or the VIE or the VIE s subsidiaries to obtain regulatory approval from Chinese authorities before listing in the U.S. If we or the VIE or the VIE s subsidiaries do not receive or maintain the approval, or inadvertently conclude that such approval is not required, or applicable laws, regulations, or interpretations change such that we or the VIE or the VIE s subsidiaries are required to obtain approval in the future, we or the VIE or the VIE s subsidiaries may be subject to regulatory actions or other sanctions from the CSRC or other Chinese regulatory authorities. These authorities may impose fines and penalties upon the operations and the operating privileges of the VIE or the VIE s subsidiaries in China, delay or restrict the repatriation of the proceeds from this offering into China, or take other actions that could have a material adverse effect upon the business, financial condition, results of operations, reputation and prospects of the VIE or the VIE s subsidiaries, as well as the trading price of our Class A Ordinary Shares. The CSRC or other Chinese regulatory agencies may also take actions requiring us, or making it advisable for us, to terminate this offering prior to closing. These risks could result in a material adverse change in the operations of the VIE and the VIE s subsidiaries and the value of our Class A Ordinary Shares, significantly limit or completely hinder our ability to offer or continue to offer securities to investors, or cause such securities to significantly decline in value or become worthless. For more detailed information, see "Risk Factors—Risks Related to Doing Business in China— We and the VIE and the VIE s subsidiaries may be required to obtain permission or approval from Chinese authorities to operate and issue securities to foreign investors in this offering and/or listing on the Nasdaq Stock Market, and if required and we or the VIE or the VIE s subsidiaries are not able to obtain such permission or approval in a timely manner, the securities currently being offered may substantially decline in value and become worthless. The CSRC has released for public consultation the draft rules for China-based companies seeking to conduct initial public offerings in foreign markets. While such rules have not yet gone into effect, the Chinese government may exert more oversight and control over offerings that are conducted overseas and foreign investment in China-based issuers, which could significantly limit or completely hinder our ability to offer or continue to offer our Class A Ordinary Shares to investors and could cause the value of our Class A Ordinary Shares to significantly decline or become worthless. We, the VIE and the VIE s subsidiaries have not applied for, received or been denied approval from Chinese authorities to list on the Nasdaq Stock Market." on page 40 of this prospectus, and "Risk Factors—Risks Related to Doing Business in China—The approval of the CSRC may be required in connection with this offering, and, if required, we cannot predict whether we or the VIE or the VIE s subsidiaries will be able to obtain such approval. Any requirement to obtain prior approval under the M&A Rules and/or any other regulations promulgated by relevant PRC regulatory agencies in the future could delay this offering and failure to obtain any such approvals, if required, could have a material adverse effect on the business, operating results and reputation of the VIE or the VIE s subsidiaries as well as the trading price of our Class A Ordinary Shares, and could also create uncertainties for this offering." on page 46 of this prospectus. 12 Transfer of Cash Through our Organization The VIE has written policies and procedures on cash management, which clarify the responsibilities of its accounting personnel, the usage, deposits and safekeeping of cash, and the handling of limitations on cash transfers due to PRC laws. In addition, the management of Sancai Holding monitors the cash position of each entity within the organization regularly and prepare cash flow budgets on a monthly basis to ensure each entity has the necessary funds to fulfill its obligation for the foreseeable future and to ensure adequate liquidity. In the event that there is a need for cash or a potential liquidity issue, based on the amount needed, it will be reported to our Chief Financial Officer and subject to approval by our board of directors, within the framework of the laws of each jurisdiction, we will make transfers, distributions or an intercompany loan to the entity in need. Our Hong Kong subsidiary, or Sancai HK, may transfer funds to Sancai WFOE through an increase in the registered capital or loans to Sancai WFOE. However, the receipt of funds by Sancai WFOE through an increase in registered capital or loans requires Sancai WFOE to apply for, seek approval from or register with the relevant PRC authorities or the local bank and this process may be time consuming. It may take several business days to apply for and register transfers and get approved. Sancai WFOE has the exclusive right to provide or designate any entity to provide Sancaijia with business support, technical and consulting services in exchange for service fees from Sancaijia. Sancai WFOE may rely on service fees paid by Sancaijia for its cash needs, and Sancaijia is limited to transferring funds to Sancai WFOE in the form of service fees pursuant to the Exclusive Technical Consultation and Service Agreement, as amended and restated, which is part of the VIE Agreements. According to the terms of Exclusive Technical Consultation and Service Agreement, these service fees shall be recognized as expenses of VIE, with a corresponding amount as revenue by Sancai WFOE and then completely eliminate in consolidation level. For income tax purposes, Sancai WFOE and Sancaijia file income tax returns on a separate company basis. The service fees paid are recognized as a tax deduction by Sancaijia and as revenue by Sancai WFOE. The PRC s statutory Enterprise Income Tax ("EIT") rates is 25%. Any limitation on the ability of Sancaijia to pay service fees to Sancai WFOE, or any tax implications of making service fees payments to Sancai WFOE, could have a material adverse effect on Sancai WFOE s financial condition and results of operations. For example, if Sancaijia incurs debt on its own behalf in the future, such debt may restrict its ability to pay service fees to Sancai WFOE. Sancai WFOE may provide loans to Sancaijia, subject to statutory limits and restrictions. Except for Sancaijia s ability to pay service fees, there are no other restrictions or limitations, such as the approval or registration procedure required by any PRC authorities, that may impact Sancaijia s ability to settle amounts owed under the VIE agreements. To make capital contributions to our PRC subsidiary, Sancai WFOE, the amount of capital contribution shall be limited to the registered capital of Sancai WFOE. However, Sancai WFOE may apply for increase of its registered capital with the local Administration for Market Regulation (AMR) at any time. In practice, under the condition that Sancai WFOE is prepared with complete materials including the application form, resolution of shareholders' meeting, resolution of the board of directors, newly revised articles of association and documents may be required as the case may be, the local AMR will generally approve the application within several business days. And after the approval of the local AMR, the local bank s approval for the inward remittances of registered capital can be also completed within a few business days. To make loans to Sancai WFOE or Sancaijia, according to the Circular of the People s Bank of China on Matters relating to the Macro-prudential Management of Comprehensive Cross-border Financing, or PBOC Circular 9, the total cross-border financing of a company shall be calculated using a risk-weighted approach and shall not exceed an upper limit. The upper limit shall be calculated as capital or assets (for enterprises, net assets shall apply) multiplied by a cross-border financing leverage ratio and multiplied by a macro-prudential regulation parameter. The macro-prudential regulation parameter is currently one, which may be adjusted by the People s Bank of China and the State Administration of Foreign Exchange in the future, and the cross-border financing leverage ratio is 2 for enterprises. Therefore, the upper limit of the loans that a PRC company can borrow from foreign companies shall be calculated at two times the borrower s net assets. When Sancai WFOE and Sancaijia jointly apply for borrowing foreign debt, the upper limit of borrowing shall be two times of the net assets in the consolidated financial statement, and Sancaijia shall make a commitment to give up its application for borrowing foreign debt in its own name. Furthermore, Sancai WFOE, as a foreign-invested enterprise, may also choose to calculate the upper limit of foreign debt borrowing based on the surplus between the total investment in projects approved by the verifying departments and the registered capital. We can make loans to Sancai WFOE within the range of the surplus. Sancai Holding, as a holding company, does not have material operation. Sancaijia and its subsidiaries conduct business in the PRC. The financial information of Sancaijia and its subsidiaries are consolidated into our financial statements for accounting purposes. We believe the offering proceeds would be available for investments in Sancaijia and its subsidiaries operation in the PRC after completing the registration as described above. However, we cannot assure you that we or the VIE and the VIE s subsidiaries will be able to obtain relevant government registrations or approvals on a timely basis, or at all. See "Risk Factors — Risks Related to Our Corporate Structure — PRC regulation of loans to and direct investment in PRC entities by offshore holding companies to PRC entities may delay or prevent us from making loans or additional capital contributions to Sancai WFOE, the VIE and the VIE s subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand the business of the VIE and the VIE s subsidiaries." 13 In addition to funds generated from sales of SaaS solutions and other products, Sancaijia s operations may be financed by loans from Sancai WFOE, which may receive funds from Sancai Holding, through either capital contributions or loans, directly or indirectly. Funds from Sancaijia to Sancai Holding are remitted as service fees to Sancai WFOE, which, in turn, makes distributions or pays dividends to Sancai HK, which in turn distributes or otherwise transfers such funds to Sancai Seychelles and finally to Sancai Holding. The PRC laws governing dividend distribution by foreign-invested enterprises in the PRC are primarily the Company Law of the PRC, as amended. Under such laws, foreign-invested enterprises may pay dividends only out of their accumulated profit, if any, as determined in accordance with PRC accounting standards and regulations. Both PRC domestic companies and wholly-foreign owned PRC enterprises are required to set aside as general reserves at least 10% of their after-tax profit, until the cumulative amount of such reserves reaches 50% of their registered capital. Applicable PRC law permits payment of dividends to Sancai Holding by our PRC subsidiary only out of its net income, if any, determined in accordance with PRC accounting standards and regulations. Our PRC subsidiary and Sancaijia and its subsidiaries in China are required to set aside a portion of their net income, if any, each year to fund general reserves for until such reserves have reached 50% of such company s registered capital. These reserves are not distributable as cash dividends. A PRC company is not permitted to distribute any profits until any losses from prior fiscal years have been offset. Profits retained from prior fiscal years may be distributed together with distributable profits from the current fiscal year. In addition, registered share capital and capital reserve accounts are also restricted from withdrawal in the PRC, up to the amount of net assets held in each PRC company. As a Cayman Islands holding company, Sancai Holding may receive dividends from our PRC subsidiary through our intermediary holding companies in Hong Kong and Seychelles. The EIT Law and its implementing rules provide that dividends paid by a PRC entity to a non-resident enterprise for income tax purposes are subject to PRC withholding tax at a rate of 10%, subject to reduction by an applicable tax treaty with China. According to the Arrangement between China and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income and Capital and relevant implanting notice, if our Hong Kong subsidiary satisfies all the requirements under the tax arrangement and receives approval from the relevant tax authority, the dividends paid to our Hong Kong subsidiary would be subject to withholding tax at a reduced rate of 5%. See "Risk Factors—Risks Related to Doing Business in China—Sancai Holding may not be able to obtain certain benefits under relevant tax treaty on dividends paid by our PRC subsidiary to us through our Hong Kong subsidiary". To the extent our cash is in the PRC or a PRC entity, the funds may not be available to distribute dividends to our investors, or for other use outside of the PRC, due to interventions in or the imposition of restrictions and limitations on the ability of us, our subsidiaries, or the VIE and the VIE s subsidiaries by the PRC government to transfer cash. The PRC government imposes controls on the convertibility of Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. All of the VIE and VIE s subsidiaries income are received in Renminbi and shortages in foreign currencies may restrict our ability to pay dividends or other payments, or otherwise satisfy our foreign currency denominated obligations, if any. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and expenditures from trade-related transactions, can be made in foreign currencies without prior approval from SAFE as long as certain procedural requirements are met. Approval from appropriate government authorities is required if Renminbi is converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. Our cash dividends, if any, will be paid in U.S. dollars. The PRC government may, at its discretion, impose restrictions on access to foreign currencies for current account transactions and if this occurs in the future, we may not be able to pay dividends in foreign currencies to our shareholders. See "Risk Factors — Risks Related to Doing Business in China— Governmental control of currency conversion may limit the VIE s ability to utilize the net revenues effectively and affect the value of your investment, and —We must remit the offering proceeds to PRC before they may be used to benefit the business of the VIE and the VIE s subsidiaries in the PRC, and this process may take a number of months." In contrast, presently, there is no foreign exchange control or restrictions on capital flows out of Hong Kong to Seychelles or out of Seychelles. Hence, Sancai HK, our Hong Kong subsidiary, is able to transfer cash by loans without any limitation or by cash dividends to its direct parent company, Sancai Seychelles, out of profits available for distribution. Sancai Seychelles may transfer cash by loans without any limitation or by cash dividends to its direct parent company Sancai Holding if, immediately after the distribution, Sancai Seychelles will be able to pay its debts as they become due and the value of its assets will be greater than the value of its liabilities. As of the date of this prospectus, there have not been any transfers, dividends or distributions by and among Sancai Holding, its subsidiaries, the VIE and the VIE s subsidiaries, or to investors. In addition, as of the date of this prospectus, there have been no funds or other distributions transferred by or among Sancai WFOE, the VIE and the VIE s subsidiaries and no amounts owed under the VIE Agreements has been settled by or between the VIE and Sancai WFOE. 14 Sancaijia intends to distribute earnings or settle amounts owed under the VIE Agreements. We anticipate that, to the extent that Sancaijia requires funds from us for its operations, Sancai Holding will provide funds in the manner described above, and to the extent that Sancaijia generates positive cash flow from its operations in excess of its requirements for its operations, it will transfer such excess funds to Sancai Holding, through payments to Sancai WFOE. The following table shows the nature of the flow of funds from Sancai Holding to its subsidiaries and to Sancaijia and from Sancaijia to Sancai Holding s subsidiaries and to Sancai Holding. (1) Capital Contribution / Shareholder Loans (2) Loans (3) Service Fees (4) Dividends / Distributions 15 Holding Foreign Companies Accountable Act (the "HFCA Act") The HFCA Act was enacted on December 18, 2020. The HFCA Act states if the SEC determines that a company has filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit our Class A Ordinary Shares from being traded on a national securities exchange or in the over the counter trading market in the United States. On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCA Act. A company will be required to comply with these rules if the SEC identifies it as having a "non-inspection" year under a process to be subsequently established by the SEC. The SEC is assessing how to implement other requirements of the HFCA Act, including the listing and trading prohibition requirements described above. On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act which, if passed by the U.S. House of Representatives and signed into law, would reduce the number of consecutive non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two years. On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act, which became effective on January 10, 2022. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions. On December 16, 2021, PCAOB announced the PCAOB HFCA Act determinations (the "PCAOB determinations") relating to the PCAOB s inability to inspect or investigate completely registered public accounting firms headquartered in mainland China of the PRC or Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in the PRC or Hong Kong. On August 26, 2022, the PCAOB announced that it had signed a Statement of Protocol (the "SOP") with the China Securities Regulatory Commission and the Ministry of Finance of China. The SOP, together with two protocol agreements governing inspections and investigations (together, the "SOP Agreement"), establishes a specific, accountable framework to make possible complete inspections and investigations by the PCAOB of audit firms based in mainland China and Hong Kong, as required under U.S. law. The SOP Agreement remains unpublished and is subject to further explanation and implementation. Pursuant to the fact sheet with respect to the SOP Agreement disclosed by the SEC, the PCAOB shall have sole discretion to select any audit firms for inspection or investigation and the PCAOB inspectors and investigators shall have a right to see all audit documentation without redaction. According to the PCAOB, its December 2021 determinations under the HFCA Act remain in effect. The PCAOB is required to reassess these determinations by the end of 2022. Under the PCAOB s rules, a reassessment of a determination under the HFCA Act may result in the PCAOB reaffirming, modifying or vacating the determination. However, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered public accounting firms in mainland China and Hong Kong, the PCAOB is likely to determine by the end of 2022 that positions taken by authorities in the PRC obstructed its ability to inspect and investigate registered public accounting firms in mainland China and Hong Kong completely, then the companies audited by those registered public accounting firms would be subject to a trading prohibition on U.S. markets pursuant to the HFCA Act. Our auditor, BF Borgers CPA PC, the independent registered public accounting firm that issues the audit report included in this prospectus, is registered with the PCAOB and is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess BF Borgers CPA PC s compliance with applicable professional standards. BF Borgers CPA PC is headquartered in Lakewood, Colorado and has been inspected by the PCAOB on a regular basis, with the last inspection in 2021. Therefore, we believe that, as of the date of this prospectus, our auditor is not subject to the PCAOB determinations. See "Risk Factors — Risks Related to Our Class A Ordinary Shares and this Offering — Trading of our securities may be prohibited under the Holding Foreign Companies Accountable Act if the PCAOB determines that it cannot inspect or fully investigate our auditor in the future and as a result Nasdaq may determine not to list our securities" on page 65. We cannot assure you whether Nasdaq or other regulatory authorities will apply additional or more stringent criteria to us. Such uncertainty could cause the market price of our Class A Ordinary Shares to be materially and adversely affected.
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+SUMMARY OF THE PROSPECTUS This summary highlights selected information from this prospectus and does not contain all of the information that is important to you in making an investment decision. This summary is qualified in its entirety by the more detailed information included in this prospectus. Before making your investment decision with respect to our securities, you should carefully read this entire prospectus, including the information under Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements included elsewhere in this prospectus. About Astra Astra s mission is to launch a new generation of launch services and space products and services to Improve Life on Earth from Space . These services and products are enabled by new constellations of small satellites in Low Earth Orbit ( LEO ), which have rapidly become smaller, cheaper, and many times more numerous than legacy satellites. Launch vehicles, however, have not evolved in the same way most rockets remain focused on serving legacy satellites and human spaceflight missions. We aim to solve this problem with the world s first mass-produced dedicated orbital launch system. Our system consists of a small launch vehicle and mobile ground infrastructure that can fit inside standard shipping containers for rapid deployment anywhere in the world that our spaceports are located. Our rocket requires a launch site with little more than a concrete pad and only six Astra employees on-site, leveraging our highly automated launch operations. Our production system is designed to scale efficiently, which we expect to allow us to perform to hundreds of launches per year in the future. Our rocket s payload capacity is tailored for the needs of modern LEO satellite constellations, allowing precise and rapid placement of individual satellites in their required orbits. We believe this makes Astra s system more responsive and affordable than other launch alternatives for the thousands of LEO satellites planned in the coming decade. In July 2022, we decided to focus on the development and production of the next version of our launch system, which we unveiled at our inaugural SpaceTech Day on May 12, 2022. As a result, we have discontinued the production of launch vehicles supported by our current launch system and do not plan to conduct any further commercial launches in 2022. As part of the development cycle for our new launch system, we expect to conduct test launches of our new launch system in 2023 but are not certain whether we will be able to conduct paid commercial launches in 2023 using this new launch system. Whether we will be able to conduct paid commercial launches in 2023 will depend in part upon the success of these test launches.
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+PROSPECTUS SUMMARY This summary highlights information about us, this offering and selected information contained elsewhere in or incorporated by reference into this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus and the documents incorporated by reference herein, including our financial statements and the related notes to those financial statements and the information set forth under the sections titled Risk Factors and Cautionary Note Regarding Forward-Looking Statements. Our Company We are a specialty medical device company dedicated to bringing vision and freedom back to patients suffering from late-stage conditions of the retina. We are engaged in the research, development, manufacturing, and marketing of proprietary ophthalmic devices and technologies that are intended to significantly improve vision and quality of life for individuals with untreatable retinal disorders, particularly Age-Related Macular Degeneration ( AMD ). Eye health markets are some of the most lucrative and growing markets in the health care sector today. In addition, we believe that within the eye health market, the retinal disease market is among the most valuable, as it features an area of great unmet need. BrightFocus Foundation estimates that the number of individuals world-wide diagnosed with AMD is expected to grow to 288 million by the year 2040. While treatments focus on the neovascular nature of the wet form of the disease, there are no treatments for the vision loss experienced in the late stages of the dry form of the disease or for the late stages of the disease for those who experienced neovascularization but are now faced with a life of blindness from the condition. Research focus and investments are abundant in the early part of the disease when preventing progress of the disease is the goal. However, there is significant unmet medical need for those who have progressed beyond the benefit of these proposed drug interventions. We feel strongly that, while other companies focus on therapeutic interventions for AMD, our products should be considered complimentary interventions that serve to assist those patients who are in the end stages of the disease s progression. Our team is passionately developing a solution for patients in this underserved group. There are more than 11 million people living today with blindness from AMD. This group not only suffers from loss of vision, but also a significant loss of social function and the depression that goes along with it. Furthermore, poor vision puts patients at a higher risk for accidental injury, which can lead to orthopedic concerns. When determining reimbursement amounts, payers recognize the burden of the vision loss associated with AMD both in terms of patient risk and monetary impact on the health system. Earlier generations of our devices have already earned significant reimbursement values in the United States. With elegant solutions and more widespread reimbursement, the potential for this market to grow is evident. We believe that a device that penetrates even a small portion of the patient population has the potential to become a highly lucrative product. Our current product line consists of: our first-generation implantable miniature telescope ( IMT ), which we refer to as WA IMT; our Smaller-Incision, New Generation (SING) IMT, which we refer to as SING IMT; and our Tsert delivery system. Our WA IMT is the first implantable medical device approved by the U.S. Food and Drug Administration ( FDA ) that works similarly to the telephoto lens of a camera, which enables improvement in vision and quality of life for individuals with the most advanced form of AMD, commonly referred to as late-stage AMD. It is important to note that not every patient with late-stage AMD is a candidate for treatment using our WA IMT. The various, currently held regulatory approvals in different markets carry differing labels that list a number of conditions and contraindications and general exclusion criteria. Our WA IMT was approved by the FDA in July 2010 and received a Conformit Europ enne Mark ( CE Mark ), which was granted in August 2005 by mdc medical device certification GmbH, a European Economic Area ( EEA ) notified body, number 0483. A notified body is an organization designated by a European Union ( EU ) member state to assess the conformity of certain products prior to their release in the EU (a Notified Body ). In order to demonstrate compliance with the essential requirements necessary TABLE OF CONTENTS to receive a CE Mark, a medical device must undergo a conformity assessment procedure which varies according to the type of medical device and its classification. Except for low risk medical devices, a conformity assessment procedure requires the intervention of an organization accredited by a member state of the EEA to conduct conformity assessments, or a notified body. Depending on the relevant conformity assessment procedure, the notified body would typically audit and examine the technical file and the quality system for the manufacture, design and final inspection of our devices. The notified body issues a CE Certificate of Conformity following successful completion of a conformity assessment procedure conducted in relation to the medical device and its manufacturer and their conformity with the essential requirements. This certificate entitles the manufacturer to affix the CE Mark to its medical devices after having prepared and signed a related EC Declaration of Conformity. Finally, the CE Mark is contingent upon continued compliance to the applicable regulations and the quality system requirements of the ISO 13485 standard. The CE Mark is an international symbol that, once affixed, enables a product to be sold within the European Union ( EU ) and other countries that recognize the CE Mark, subject to compliance with applicable submission and approval requirements in such other countries. See Business Government Regulation and Product Approval European Union. Our SING IMT, our next generation injectable device, is supported by flexible and foldable silicone haptics, requiring less manipulation by the surgeon. Our SING IMT will be shipped pre-loaded inside a sophisticated injector system and implanted through a smaller incision. Our SING IMT is projected to reduce the average surgery time by half, down from greater than sixty minutes for our WA IMT. This includes removal of a patient s cataract. Our SING IMT s advantages over our WA IMT include surgical outcomes that are much less dependent on surgeon skill and reduced recovery time for patients due to the smaller incision size. According to SING IMT instructions for use, the incision size during surgery is 6.5mm. Based on this wound size, we expect that the SING IMT procedure will only require 3 sutures. We believe that these improvements lead to a less traumatic experience illustrated by a reduction in the corneal endothelial cell density loss experienced by patients. During nine SING IMT clinical procedures conducted in Ireland, endothelial cell density ( ECD ) loss was less than 8% which compares favorably to a loss of 23% 25% with the WA IMT. We believe that this will be a key factor for safety and a primary endpoint in the clinical trial necessary for regulatory approval. SING IMT patients also reported faster recovery including recognition of visual effect in 1-3 days post-op, as compared to 7-21 days with the WA IMT. In addition to the potential patient benefits, we believe that this procedure will also allow us to introduce the SING IMT to a broader group of ophthalmic surgeons including cataract and retina surgeons. We received a CE Mark by mdc medical device certification GmbH, an EEA Notified Body, number 0483, for our SING IMT and Tsert delivery system in April 2020 and began commercializing our SING IMT in Europe in 2021. In addition, we are in the process of establishing the regulatory pathway into the United States. Our SING IMT is classified as a Class III medical device and therefore cannot be marketed in the United States unless the FDA approves the device after submission of a premarket approval ( PMA ). The FDA has already indicated that a clinical trial will be required to obtain this approval. We plan to commence clinical trials for our SING IMT once the FDA has approved such an action. Our WA IMT has proven clinical benefit. However, the surgical difficulties and large incision size have made the device unable to gain widespread adoption. With the incision size reduced from 12mm down to 6.5mm and the need for sutures significantly reduced, we believe that our SING IMT addresses any outstanding safety concerns regarding the large loss of endothelial cell density caused by our WA IMT s manual insertion and any time-on-task issues. We believe that the small incision required for insertion of our SING IMT using our Tsert delivery system will result in a simpler, faster, and safer surgery, facilitating faster physician adoption and faster visual recovery for patients. Product Line Background and Pipeline Overview Our WA IMT underwent a significant full development cycle over a number of years, culminating in FDA approval after a clinical study with 217 patients. We then proceeded to establish reimbursement in the United States under Medicare for both hospitals and ambulatory surgery centers ( Ambulatory Surgery Centers ) and began an initial phase of commercialization in the United States to obtain market feedback as well as to prove reimbursement payment with most U.S. insurance payers. TABLE OF CONTENTS While reimbursement payments were proven and visual outcomes were as expected for the pre-screened patients, market feedback, both from surgeons as well as potential commercial partners, indicated that the first-generation product involved: a highly technical, skill-based procedure (limiting the number and type of surgeons); greater than one-hour surgery times; and a large incision to place our WA IMT into the eye and many sutures to close the wound. Based on this feedback and given the trajectory that general cataract surgery has taken over the years, we sought a less invasive and skill-based procedure to significantly reduce the incision-size and surgery time while increasing patient benefits. The result of this is our SING IMT, which utilizes our TSert delivery system. Features of the SING IMT include: the same outstanding optical elements and performance as our WA IMT; foldable haptics utilizing a much smaller incision and allowing for the delivery through an inserter; reduced surgery time that broadens the available base of surgeons and simplifies the training process; significantly less trauma leading to faster healing; and a fully preloaded, uniquely designed delivery system. We believe that ongoing testing will demonstrate the SING IMT system is a major improvement over our first-generation product, addressing market feedback. The SING IMT system is the product on which we intend to build our future. Our Strengths Our WA IMT has clinically proven results under commercial conditions as well as peer-reviewed published long-term data. Our WA IMT is the first implantable medical device approved by the FDA that works similarly to the telephoto lens of a camera, resulting in improvement in vision and quality of life in individuals with late-stage AMD. Our product line improves freedom for those patients suffering from late-stage AMD. This disease is one of the largest causes of non-preventable blindness in the world. Late-stage AMD patients are in need of products to improve the quality of their lives. There are currently no effective therapeutics for dry AMD. Our WA IMT and the implantation thereof are approved by the Centers for Medicare & Medicaid Services ( CMS ) for reimbursement in the United States. This coverage decision applies to both our WA IMT and the surgeon fee. Surgeon reimbursement for the surgery tends to be in the range of approximately $1,500 $1,800. For the year 2021, the CMS-approved reimbursement amount for the currently approved non-injectable version of our product is approximately $20,800 for both hospitals and Ambulatory Surgery Centers. For 2022, CMS has approved a hospital outpatient reimbursement rate of $24,166.29 and an Ambulatory Surgical Center reimbursement rate of $22,857.10. Our gross margins, while fluctuating and dependent on various components and supplier prices, volume of production, and model, have been reasonably stable in the 85% to 90% range for our WA IMT device based on U.S. average selling price ( ASP ). Our SING IMT, which is currently not approved in the United States, adds the injector as a component to the overall cost. While the final margins have not been set and volume production has not been started, we believe our margins for the SING IMT surgical system will be in this range based on current U.S. pricing. Our SING IMT and TSert delivery system received a CE Mark in April 2020, and we are in process of establishing the U.S. regulatory pathway. TABLE OF CONTENTS Our manufacturing facility complies with Good Manufacturing Practices ( GMPs ) and the European Union Medical Device Directive (Council Directive 93/42/EEC) ( EU MDD ) and subsequent amendments. Our experienced workers and line productions can facilitate large scale production. We remain focused on continuing to improve our products and advance our technologies. We maintain an active internal research and development team, which is responsible for clinical activities and regulatory affairs. Our intellectual property portfolio consists of 97 active patents and patent applications. Of these 97, 14 are issued U.S. patents, with another two pending U.S. patent applications. The remainder of the portfolio includes issued patents and pending applications in China, Hong Kong, Japan, Europe (including various national state validations) and Canada. The patent estate is directed to the core IMT implant, SING IMT and the TSert delivery system. These patents and patent applications have claims directed to apparatuses, systems and methods for implantation of IMT devices. The issued patents first begin to expire in 2023, with the last of these patents, which broadly claims the components of the SING IMT system, expiring in 2038. Our management team has more than 200 years of collective successful experience in the ophthalmology and medical device industry. Our research and development and manufacturing teams in Tel Aviv, Israel have extensive experience in the development and manufacturing of ophthalmology related devices and technologies. Our Strategy We aim to further enhance and develop our technology, acquire world-wide regulatory approvals, garner appropriate reimbursement, and commercialize our product line. Development and execution of commercial strategies aims to ensure our breakthrough technologies are delivered to patients who desperately need improvement in quality of life. Our strategic imperatives include, but are not limited to: Rebranding to inspire: we have successfully rebranded the company from VisionCare to Samsara Vision. This effort has focused the industry on our future and the customer experience associated with our SING IMT. We have also successfully branded our SING IMT to focus on the outstanding nature of the product design and provide a simple nomenclature for Key Opinion Leaders and surgeons who are referencing the product and procedure. Garner reimbursement to facilitate care: a critical success factor in our strategy is gaining and maintaining appropriate reimbursement from payers around the world. In the United States, CMS has provided significant reimbursement for our WA IMT procedure in 2021 and has published an increase in reimbursement rates for 2022. As the SING IMT has received a CE Mark in April 2020, we are now engaged in efforts to attain reimbursement in European markets. Appropriate reimbursement provides access for patients in need of care and a driver for surgeons to treat. Enter critical markets to bring innovation to patients: we plan to apply for FDA approval of our SING IMT in the United States and commercialize our SING IMT in all global markets subject to approval by each regulatory agency. Currently, our SING IMT is being commercialized in the EU, Singapore, Australia, Korea, India, Taiwan, Hong Kong, Canada, and Latin/South American markets. Research and develop our pipeline to improve the customer experience: we plan to further develop our pipeline with smaller incision models and other technical advances and to broaden market acceptance through label expansions and life-cycle management. Optimize distribution, sales, and marketing to broaden and deepen our reach: We have engaged with business partners in the EU (Medevise), UK, Canada (Innova Medical), Asia Pacific, Australia & New Zealand (Sunny Side, Dill Jacob), and Latin America. We are also actively seeking partnerships in China and Japan. We are planning to deploy a Centers of Excellence model where we train and develop each surgeon and hospital on the nuances of our procedure and patient experience. We plan to spend the time to build each center with care. TABLE OF CONTENTS These strategies could be delayed by further interactions with the FDA, either before or after starting our trials, or by a variety of other factors, including the final design of the study to be approved by the FDA, and are subject to the risks and uncertainties set forth under Risk Factors Risks Related to Our Business and Risks Related to Product Development and Regulatory Approval. There can be no assurance that the FDA will approve our pre-market approval supplement or, if approved, that it will be granted in accordance with our anticipated time schedule. In addition, the FDA may require us to conduct post-approval studies ( PAS ) as a condition of approval. Controlled Company Immediately following the completion of this offering, we expect that VOT Holdings LLC ( VOT ) will control approximately 76.8% of our outstanding common stock. Accordingly, we will be considered a controlled company under Nasdaq Marketplace rules and the Company will be eligible to utilize certain exemptions from the corporate governance requirements of the Nasdaq Capital Market. We do not currently intend to avail ourselves of these exemptions.
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+PROSPECTUS SUMMARY 1
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+This summary highlights selected information appearing elsewhere in this prospectus. Because it is a summary, it may not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus carefully, including the information set forth under the heading Risk Factors and our financial statements. The Company We are a digital media platform which focuses on performance-first, privacy-forward methods to execute programmatic digital advertising campaigns, serving both advertising agency and brand customers. Without relying on individualized profiles or sensitive personal data for targeting, we utilize machine learning and advanced data analytics to make programmatic digital advertising more effective and efficient at scale, delivering measurable real-world value for advertisers. Our differentiated advertising capabilities and superior campaign performance, measured by customer-defined business metrics or Key Performance Indicators ( KPIs ), have helped fuel our customer adoption and year-after-year growth. Our technology and solutions, conceived and developed in-house since 2012, have been recognized with numerous awards including Drum Digital Advertising Awards (2020), MMA Smarties Awards (2018-2020), Martech Breakthrough Awards (2020-2021) and Deloitte s Technology Fast 500 (2015-2018). Additionally, we were awarded Best AI-Based Advertising Solution (AI Breakthrough Awards) (2018-2021) and Most Innovative Product (B.I.G. Innovation Awards) (2018-2021) for four consecutive years. AdTheorent is also the only five-time recipient of Frost & Sullivan s Digital Advertising Leadership Award (2016-2020). Background We were originally known as MCAP Acquisition Corporation. On December 22, 2021, MCAP consummated the Business Combination with Legacy AdTheorent pursuant to the Business Combination Agreement, dated as of July 27, 2021, by and among MCAP, the Merger Sub Entities, the Blocker, H.I.G. Growth AdTheorent, LLC and Legacy AdTheorent. In connection with the Closing of the Business Combination, MCAP changed its name to AdTheorent Holding Company, Inc. Legacy AdTheorent was deemed to be the accounting acquirer in the Business Combination based on an analysis of the criteria outlined in Accounting Standards Codification 805. While MCAP was the legal acquirer in the Business Combination, because Legacy AdTheorent was deemed the accounting acquirer, the historical financial statements of Legacy AdTheorent became the historical financial statements of the combined company, upon the consummation of the Business Combination. Concurrently with the execution of the Business Combination Agreement, MCAP entered into subscription agreements (each, a Subscription Agreement ) with certain investors (the PIPE Investors ), pursuant to which the PIPE Investors agreed to subscribe for and purchase, and MCAP agreed to issue and sell to the PIPE Investors, immediately prior to the Closing, an aggregate of 12,150,000 shares of the Class A common stock, par value $0.0001 per share (the Class A Common Stock ), of MCAP (the PIPE Shares ), for a purchase price of $10.00 per share, representing aggregate gross proceeds of $121.50 million (the PIPE Financing ). Pursuant to the Subscription Agreements, the Company gave certain registration rights to the PIPE Investors with respect to the PIPE Shares. The sale of the PIPE Shares was consummated concurrently with the Closing. The PIPE Shares were issued pursuant to and in accordance with the exemption from registration under the Securities Act under Section 4(a)(2) and/or Regulation D promulgated thereunder. Pursuant to our prior amended and restated certificate of incorporation, each issued and outstanding share of Class B Common Stock, par value $0.0001 per share (the Class B Common Stock ), converted into one share of Table of Contents Exhibit No. Description Incorporation by Reference 10.5# MCAP Acquisition Corporation 2021 Employee Stock Purchase Plan Exhibit 10.5 to the Current Report on Form 8-K filed on December 29, 2021 10.6# Form of Stock Option Grant Notice under the MCAP Acquisition Corporation 2021 Long-Term Incentive Plan Exhibit 10.6 to the Current Report on Form 8-K filed on December 29, 2021 10.7# Form of RSU Award Grant Notice under the MCAP Acquisition Corporation 2021 Long-Term Incentive Plan Exhibit 10.7 to the Current Report on Form 8-K filed on December 29, 2021 10.8 Form of Indemnification Agreement Exhibit 10.8 to the Current Report on Form 8-K filed on December 29, 2021 16.1 Letter from Marcum LLP to the Securities and Exchange Commission, dated December 29, 2021 Exhibit 16.1 to the Current Report on Form 8-K filed on December 29, 2021 21.1 Subsidiaries of the Registrant Exhibit 21.1 to the Current Report on Form 8-K filed on December 29, 2021 23.1 Consent of BDO USA LLP 23.2 Consent of Marcum LLP 23.3 Consent of Paul Hastings LLP (included in Exhibit 5.1) 24.1 Power of Attorney (included on the signature page hereto) 101.INS XBRL Instance Document 101.SCH XBRL Taxonomy Extension Schema Document 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF XBRL Taxonomy Extension Definition Linkbase Document 101.LAB XBRL Taxonomy Extension Label Linkbase Document 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) * Schedule and exhibits to this Exhibit omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request. ** Portions of this Exhibit have been omitted in accordance with Item 601 of Regulation S-K. # Indicates a management or compensatory plan. Item 17. Undertakings. (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: Table of Contents The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling securityholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED JANUARY 14, 2022 PRELIMINARY PROSPECTUS AdTheorent Holding Company, Inc. Up to 76,713,193 Shares of Common Stock Up to 15,973,904 Shares of Common Stock Issuable Upon the Exercise of Warrants Up to 5,432,237 Warrants This prospectus relates to the issuance by us of up to an aggregate of 15,973,904 shares of our common stock, $0.0001 par value per share ( Common Stock ), which consists of (i) up to 10,541,667 shares of Common Stock issuable upon the exercise of 10,541,667 warrants (the Public Warrants ) originally issued in the initial public offering of MCAP Acquisition Corporation, a Delaware corporation ( MCAP ), by the holders thereof, and (ii) up to 5,432,237 shares of Common Stock issuable upon the exercise of 5,432,237 warrants (the Private Warrants and, together with the Public Warrants, the Warrants ) originally issued in a private placement in connection with the initial public offering of MCAP (551,096 of which are subject to escrow and forfeiture unless certain earn-out targets are achieved pursuant to the Business Combination Agreement (as defined below)). We will receive the proceeds from any exercise of the Warrants for cash. This prospectus also relates to the offer and sale from time to time, upon the expiration of lock-up agreements, if applicable, by (a) the selling stockholders named in this prospectus (including their permitted transferees, donees, pledgees and other successors-in-interest) (collectively, the Selling Stockholders ) of up to 76,713,193 shares of Common Stock, consisting of (i) up to 12,150,000 shares of Common Stock, issued in a private placement to the PIPE Investors (as defined below) pursuant to the terms of separate Subscription Agreements (as defined below) in connection with the Business Combination (as defined below), (ii) up to 5,432,237 shares of Common Stock that may be issued upon the exercise of the Private Warrants, (iii) up to 7,906,250 shares of Common Stock held by MCAP Acquisition, LLC (the Sponsor ) and its affiliates, (iv) up to 13,935,678 shares of Common Stock held by or underlying equity awards held by affiliates of AdTheorent Holding Company, Inc. ( AdTheorent or the Company ), (v) up to 34,064,174 shares of Common Stock held by H.I.G. Growth AdTheorent, LLC, and (vi) up to 3,224,854 additional shares of Common Stock held by entities affiliated with Monroe Capital, LLC and (b) the selling warrant holders named in this prospectus (including their permitted transferees, donees, pledgees and other successors-in-interest) (collectively, the Selling Warrantholders and, together with the Selling Stockholders, the Selling Securityholders ) of up to 5,432,237 Private Warrants. We are registering the securities for resale pursuant to the Selling Securityholders registration rights under certain agreements between us and the Selling Securityholders. Our registration of the securities covered by this prospectus does not mean that the Selling Securityholders will offer or sell any of the shares of Common Stock or Warrants registered hereby. The Selling Securityholders may offer, sell or distribute all or a portion of their shares of Common Stock or Warrants publicly or through private transactions at prevailing market prices or at negotiated prices. We provide more information about how the Selling Securityholders may sell the shares or Warrants in the section entitled Plan of Distribution. We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), and are subject to reduced public company reporting requirements. This prospectus complies with the requirements that apply to an issuer that is an emerging growth company. Our Common Stock and Public Warrants are listed on the Nasdaq Capital Market (the NASDAQ ) under the symbols ADTH and ADTHW, respectively. On January 13, 2022, the closing price of our Common Stock was $5.34 per share and the closing price of our Public Warrants was $0.71 per Warrant. See the section entitled Risk Factors beginning on page 6 of this prospectus to read about factors you should consider before buying our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022 Table of Contents ABOUT THIS PROSPECTUS This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the SEC ) using the shelf registration process. Under this shelf registration process, the Selling Securityholders may, from time to time, sell the securities offered by them described in this prospectus. We will not receive any proceeds from the sale by such Selling Securityholders of the securities offered by them described in this prospectus. This prospectus also relates to the issuance by us of the shares of Common Stock issuable upon the exercise of the Warrants. We will not receive any proceeds from the sale of shares of Common Stock underlying the Warrants pursuant to this prospectus, except with respect to amounts received by us upon the exercise of the Warrants for cash. Neither we nor the Selling Securityholders have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you. Neither we nor the Selling Securityholders take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. Neither we nor the Selling Securityholders will make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. We may also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which we refer you in the sections of this prospectus entitled Where You Can Find More Information . On December 22, 2021 (the Closing Date ), MCAP, now known as AdTheorent Holding Company, Inc., consummated the previously announced business combination pursuant to that certain Business Combination Agreement, dated as of July 27, 2021 (as amended, restated, supplemented or otherwise modified, the Business Combination Agreement ), by and among MCAP, GRNT Merger Sub 1 LLC, a Delaware limited liability company ( Merger Sub 1 ), GRNT Merger Sub 2 LLC, a Delaware limited liability company ( Merger Sub 2 ), GRNT Merger Sub 3 LLC, a Delaware limited liability company ( Merger Sub 3 ), GRNT Merger Sub 4 LLC, a Delaware limited liability company ( Merger Sub 4 and, together with Merger Sub 1, Merger Sub 2 and Merger Sub 3, the Merger Sub Entities ), H.I.G. Growth AdTheorent Intermediate, LLC, a Delaware limited liability company (the Blocker ), H.I.G. Growth AdTheorent, LLC, a Delaware limited liability company, and AdTheorent Holding Company, LLC, a Delaware limited liability company ( Legacy AdTheorent ). Pursuant to the terms of the Business Combination Agreement, Legacy AdTheorent, the Blocker and the Merger Sub Entities engaged in a series of four mergers, which resulted in Legacy AdTheorent becoming a wholly owned subsidiary of MCAP (the Business Combination ). On the Closing Date, and in connection with the closing of the Business Combination (the Closing ), MCAP changed its name to AdTheorent Holding Company, Inc. Unless the context indicates otherwise, references in this prospectus to the Company, AdTheorent, we, us, our and similar terms refer to AdTheorent Holding Company, Inc. and its consolidated subsidiaries (including Legacy AdTheorent). References to MCAP refer to our predecessor company prior to the consummation of the Business Combination. Table of Contents Class A Common Stock, at the Closing. After the Closing and following the effectiveness of our second amended and restated certificate of incorporation ( Certificate of Incorporation ), each share of Class A Common Stock was automatically reclassified, redesignated and changed into one validly issued, fully paid and non-assessable share of Common Stock, without any further action by us or any stockholder. Our Common Stock and Public Warrants are currently listed on the on the NASDAQ under the symbols ADTH and ADTHW, respectively. The rights of holders of our Common Stock and Warrants are governed by our Certificate of Incorporation, our amended and restated bylaws (the Bylaws ) and the Delaware General Corporation Law (the DGCL ), and, in the case of the Warrants, the Warrant Agreement, dated February 25, 2021, between MCAP and Continental Stock Transfer & Trust Company(the Warrant Agreement ). See the sections entitled Description of Securities and Certain Relationships and Related Party Transactions . Emerging Growth Company We are an emerging growth company, as defined under the JOBS Act. As an emerging growth company, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. These include, but are not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and the requirement to obtain stockholder approval of any golden parachute payments not previously approved. We will remain an emerging growth company until the earlier of (1) December 31, 2026 (the last day of the fiscal year following the fifth anniversary of the consummation of MCAP s initial public offering), (2) the last day of the fiscal year in which we have total annual gross revenue of at least $1.07 billion, (3) the last day of the fiscal year in which we are deemed to be a large accelerated filer, as defined in the Exchange Act, and (4) the date on which we have issued more than $1.0 billion in nonconvertible debt securities during the prior three-year period. Corporate Information MCAP was incorporated on November 12, 2020 for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. MCAP completed its initial public offering in March 2021. In December 2021, Legacy AdTheorent, the Blocker and the Merger Sub Entities engaged in a series of four mergers, which resulted in Legacy AdTheorent becoming a wholly owned subsidiary of MCAP. In connection with the Business Combination, we changed our name to AdTheorent Holding Company, Inc. Our principal executive offices are located at 330 Hudson Street, 13th Floor, New York, New York, 10013 and our telephone number is (800) 804-1359. Our website address is www.adtheorent.com . Information contained on our website or connected thereto does not constitute part of, and is not incorporated by reference into, this prospectus or the registration statement of which it forms a part. Table of Contents CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act ). We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this prospectus, our future financial performance, strategy, expansion plans, future operations, future operating results, estimated revenues, losses, projected costs, prospects, plans and objectives of management are forward-looking statements. Any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as may, should, could, would, expect, plan, anticipate, intend, believe, estimate, continue, goal, outlook, forecast, possible, potential, predict, project or the negative of such terms or other similar expressions. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this prospectus. We caution you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. Forward-looking statements in this prospectus may include, for example, statements about: our ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition and the ability of the combined business to grow and manage growth profitably; our financial and business performance following the Business Combination, including financial projections and business metrics; our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; the implementation, market acceptance and success of our business model; demand for our platform and services and the drivers of that demand; our estimated total addressable market and other industry projections, and our projected market share; our ability to scale in a cost-effective manner; developments and projections relating to our competitors and industry; the impact of health epidemics, including the novel coronavirus ( COVID-19 ) pandemic, on our business and the actions we may take in response thereto; our expectations regarding our ability to obtain and maintain intellectual property protection and not infringe on the rights of others; expectations regarding the time during which we will be an emerging growth under the Jumpstart Our Business Startups Act of 2012 ( JOBS Act ); our future capital requirements and sources and uses of cash; our ability to obtain funding for our operations; our business, expansion plans and opportunities; and the outcome of any known and unknown litigation and regulatory proceedings. Table of Contents THE OFFERING Issuer AdTheorent Holding Company, Inc. (f/k/a MCAP Acquisition Corporation) Issuance of Common Stock Shares of Common Stock Offered by us 15,973,904 shares of Common Stock issuable upon exercise of the Warrants, consisting of (i) 5,432,237 shares of Common Stock that are issuable upon the exercise of 5,432,237 Private Warrants by the holders thereof and (ii) 10,541,667 shares of Common Stock that are issuable upon the exercise of 10,541,667 Public Warrants by the holders thereof. Shares of Common Stock Outstanding Prior to Exercise of All Warrants 85,743,994 shares (as of December 22, 2021). Shares of Common Stock Outstanding Assuming Exercise of All Warrants 101,717,898 shares (based on total shares outstanding as of December 22, 2021). Exercise Price of Warrants $11.50 per share, subject to adjustment as described herein. Use of Proceeds We will receive up to an aggregate of approximately $183.7 million from the exercise of the Warrants, assuming the exercise in full of all of the Warrants for cash. We expect to use the net proceeds from the exercise of the Warrants for general corporate purposes. See Use of Proceeds . Resale of Common Stock and Warrants Shares of Common Stock Offered by the Selling Securityholders 76,713,193 shares (including up to 5,432,237 shares of Common Stock that may be issued upon exercise of the Private Warrants). Warrants Offered by the Selling Securityholders 5,432,237 Warrants, consisting of all outstanding Private Warrants. Redemption The Warrants are redeemable in certain circumstances. See Description of Securities Warrants for further discussion. Use of Proceeds We will not receive any proceeds from the sale of shares of Common Stock or Warrants by the Selling Securityholders. Lock-Up Restrictions Certain of our stockholders are subject to certain restrictions on transfer until the termination of applicable lock-up periods. See Selling Securityholders Certain Relationships with Selling Securityholders for further discussion. Market for Common Stock and Warrants Our Common Stock and Public Warrants are currently traded on the NASDAQ under the symbols ADTH and ADTHW, respectively.
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+PROSPECTUS
+SUMMARY
+
+ 
+
+In
+this Prospectus, "Old Bailey Consultancy" the "Company," "we,"
+"us," and "our," refer to Old Bailey Consultancy Limited, a Delaware corporation,
+and Old Bailey Consultancy Limited, a British Virgin Islands company, unless the context otherwise requires. Unless otherwise indicated,
+the term "fiscal year" refers to our fiscal year ending December 31st. Unless otherwise indicated,
+the term "common stock" refers to shares of the Company s common stock.
+
+ 
+
+This
+Prospectus, and any supplement to this Prospectus include "forward-looking statements". To the extent that the information
+presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations,
+products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements
+can be identified by the use of words such as "intends", "anticipates", "believes", "estimates",
+"projects", "forecasts", "expects", "plans" and "proposes". Although we believe
+that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks
+and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others,
+the cautionary statements in the "
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+SUMMARY OF THE PROSPECTUS 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated certificate of incorporation are to our certificate of incorporation to be in effect upon the completion of this offering; Board are to our board of directors; Cantor are to Cantor Fitzgerald & Co. and William Blair are to William Blair & Company, L.L.C., the representatives of the underwriters in this offering; common stock are to our Class A common stock and our Class B common stock; directors are to our current directors and director nominees; equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for shares of our Class A common stock issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of such securities; founder shares are to shares of our Class B common stock and the shares of our Class A common stock issued upon the automatic conversion thereof at the time of our initial business combination as provided herein; initial stockholders are to our sponsor and any other holders of our founder shares immediately prior to this offering; letter agreement refers to the letter agreement to be executed by our sponsor and our officers, directors and director nominees, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering and any warrants issued to our sponsor, officers or directors upon conversion of working capital loans; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our sponsor, officers and directors to the extent our sponsor, officers or directors purchase public shares, provided that each of their status as a public stockholder shall only exist with respect to such public shares; sponsor is to Haymaker Sponsor IV LLC, a Delaware limited liability company; warrants are to our warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and the private placement warrants; and we, us, our and the company, are to Haymaker Acquisition Corp. IV, a Delaware corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise the over-allotment option and the sponsor will forfeit its corresponding 978,750 founder shares. 1 Table of Contents PROPOSED BUSINESS We are a newly organized blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We intend to acquire and operate a business in the consumer and consumer-related products and services industries and believe our management team is well suited to identify opportunities that have the potential to generate attractive risk-adjusted returns for our stockholders. However, we are not limited to these industries and we may pursue a business combination opportunity in any business or industry we choose and we may pursue a company with operations or opportunities in any geographic location. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Our executives are experienced at recognizing and quantifying the value of brands and creating strategies to reposition those brands globally so that they reach their full market potential. Not only does our management team bring a combination of operating, investing, financial and transaction experience, but certain members of our management team have also worked together for over a decade creating value for shareholders. Our management team is led by Steven J. Heyer, our Chief Executive Officer and Executive Chairman, Andrew R. Heyer, our President and Steven Heyer s brother, and Christopher Bradley, our Chief Financial Officer. Messrs. Heyer s and Heyer s careers have centered on identifying and implementing value creation initiatives within the consumer and consumer-related products and services industries. They have combined 70+ year careers in the consumer and consumer-related products and services industries by relying on what we believe to be tried-and-true management strategies: cost management and productivity enhancement, and reinvesting the savings behind product innovation, marketing, channel development, and brand building. Mr. Bradley brings extensive mergers and acquisitions, public equities, structuring and strategy consulting experience to our efforts. The combined experience of our officers includes: Haymaker Acquisition Corp. III, which we refer to as Haymaker III throughout this prospectus, a special purpose acquisition company that completed a $317.5 million initial public offering in March 2021 and is in the process of an initial business combination with BioTE Holdings, LLC; Haymaker Acquisition Corp. II, which we refer to as Haymaker II throughout this prospectus, a special purpose acquisition company that completed a $400 million initial public offering in June 2019 and completed its initial business combination in December 2020 with GPM Investments, LLC ( GPM ), a leading convenience store operator with over 2,900 locations in 33 states, and ARKO Holdings Ltd. ( ARKO Holdings ), an Israeli public holding company; and Haymaker Acquisition Corp., which we refer to as Haymaker I throughout this prospectus, a special purpose acquisition company that completed a $330 million initial public offering in October 2017 and completed its initial business combination in March 2019 with OneSpaWorld Holdings Ltd. ( OneSpaWorld ) (NASDAQ: OSW), an operator of centers offering guests a comprehensive suite of health, fitness, beauty and wellness services, treatments, and products aboard cruise ships and at destination resorts around the world. Steven J. Heyer, our Chief Executive Officer and Executive Chairman, has over 35 years of experience in the consumer and consumer-related products and services industries leading a range of companies and brands globally. He has applied his leadership and analytical skills in a variety of leadership positions across diverse industry groups, including broadcast media, consumer products, and hotel and leisure companies. He currently serves as the CEO and Executive Chairman of Haymaker III (NASDAQ: HYACU). His operating experiences include: serving as the Chief Executive Officer of Haymaker II until completion of its initial business combination with GPM and ARKO Holdings, which together merged under a new name, ARKO Corp. ( ARKO ) (NASDAQ: ARKO) as part of the business combination, and thereafter serving on its board of directors; serving as the Chief Executive Officer of Haymaker I until completion of its initial business combination with OneSpaWorld (NASDAQ: OSW), and thereafter serving on its board of directors as Vice Chairman and Director; leading the turnaround of Outback Steakhouse, as an advisor; as Chief Executive Officer and a board member of Starwood Hotels & Resorts Worldwide; as the President and Chief Operating Officer of The Coca-Cola Company (NYSE: KO); as board member of Coca-Cola FEMSA, and Coca-Cola Enterprises; as President and Chief Operating Officer of Turner Broadcasting System, Inc., and a member of AOL Time Warner s Operating Committee; as the President and Chief Operating Officer of Young & Rubicam Advertising Worldwide; and before that at Booz Allen & Hamilton, ultimately as Senior Vice President and Managing Partner. Mr. Heyer has extensive current and past board experience, including: the board of Atkins Nutritionals Inc. until 2017, when it was acquired by Conyers Park Acquisition Corp, a publicly traded special purpose acquisition company; the board of Lazard Ltd and Lazard 2 Table of Contents Group; the board of WPP Group, a publicly traded digital, internet, and traditional advertising company; the board of Equifax, the publicly traded consumer credit reporting and insights company; the board of Omnicare, Inc., a supplier of pharmaceutical care to the elderly; the board of Vitrue, Inc., a provider of social marketing publishing technologies; and the board of Internet Security Systems, Inc., a provider of internet security software, appliance, and services. In addition, Mr. Heyer has been involved in other various start-ups and turnarounds in the consumer, big data, consumer services, retail, and media industries. Andrew R. Heyer, our President, is a finance professional with over 40 years of experience investing in the consumer and consumer-related products and services industries as well as a senior banker in leveraged finance during which time his clients included many large private equity firms. He has guided several public and private companies as a member of their board of directors. Currently Mr. Heyer is the Chief Executive Officer and Founder of Mistral Equity Partners, a private equity fund that invests in the consumer industry. Prior to founding Mistral, Mr. Heyer served as a Founding Managing Partner of Trimaran Capital Partners, a $1.3 billion private equity fund. Mr. Heyer was formerly a vice chairman of CIBC World Markets Corp. and a co-head of the CIBC Argosy Merchant Banking Funds. Prior to joining CIBC World Markets Corp., Mr. Heyer was a founder and Managing Director of The Argosy Group L.P. Before Argosy, Mr. Heyer was a Managing Director at Drexel Burnham Lambert Incorporated and, previous to that, he worked at Shearson/American Express. Mr. Heyer currently serves as the President and is on the board of directors of Haymaker III (NASDAQ:HYACU). He also serves on the board of directors of ARKO Corp. (NASDAQ: ARKO) and previously served as Haymaker II s President until consummation of the business combination with ARKO. Mr. Heyer currently serves on the board of directors of OneSpaWorld (NASDAQ: OSW) and previously served as Haymaker I s President until consummation of the business combination with OneSpaWorld. He also serves on the board of directors of Tastemaker Acquisition Corp. (NASDAQ: TMKR) ( TMKR ), a blank check company which completed its $276 million initial public offering in January 2021 and is searching for a target business in the restaurant, hospitality and related technology and service sectors, AF Acquisition Corp. ( AFAQ ), a blank check company which completed its $200 million initial public offering in March 2021 and is searching for a target business in the food and beverage, health and wellness, beauty, personal care and pet industries, The Lovesac Company, Inc. (NASDAQ: LOVE) (where he serves as Chairman) as well as on the board of a private pet products company owned in part by Mistral, Worldwise, Inc. Formerly, Mr. Heyer has served on the boards of XpresSpa Group, Inc. (NASDAQ: XSPA), The Hain Celestial Group (NASDAQ: HAIN), Las Vegas Sands Corp. (NYSE: LVS), Jamba, Inc. (NASDAQ: JMBA), El Pollo Loco Holdings, Inc. (NASDAQ: LOCO), and Reddy Ice Holdings, Inc. (OTC: RDDCP). Christopher Bradley, our Chief Financial Officer and Secretary since inception, is a Managing Director at Mistral, which he joined in 2008. Mr. Bradley brings over 20 years of experience identifying acquisition candidates, due diligence experience including accounting and financial modeling acumen, and a background in deal structuring. He currently serves as the Chief Financial Officer of Haymaker III (NASDAQ:HYACU). He also serves as the Chief Financial Officer of TMKR and the Chief Financial Officer and Secretary of AFAQ. From 2019 until its business combination in December of 2020, Mr. Bradley served as the Chief Financial Officer and Secretary of Haymaker II. From 2017 until its business combination in March 2019, he was an officer of Haymaker I. Since 2016, Mr. Bradley has served as a member of the board of directors of The Beacon Consumer Incubator Fund, a venture capital fund that invests in consumer technology companies. Mr. Bradley has also previously served on the board of directors of Creminelli Fine Meats, LLC, a privately held premium-priced charcuterie wholesaler from 2016 to January 2020 and The Lovesac Company, Inc. (NASDAQ: LOVE) from 2010 to 2018. Mr. Bradley has also guided Mistral portfolio companies in an operational role and, through Mistral, served on the board of Jamba, Inc. (NASDAQ: JMBA) from 2009 to 2013. Prior to Mistral, Mr. Bradley served as an investment banker at Banc of America Securities from 2005 to 2006, a Manager in Burger King s strategy group in 2004, and a Manager at PricewaterhouseCoopers management consulting practice from 1999 to 2004. He is also currently serving on the advisory board of Coliseum Acquisition Corp (NASDAQ:MITAU) and Growth For Good Acquisition Corp (NASDAQ:GFGDU). Our board of directors will include Walter F. McLallen, the managing member of Meritage Capital Advisors, an advisory boutique firm focused on debt and private equity transaction origination, structuring and consulting, with extensive board and organizational experience, with a significant historical focus on consumer products-related companies; Roger Meltzer, Esq., a distinguished global leader; and Jeffrey Stiefler, an investor in and advisor to private growth companies with a focus on consumer products, services and technologies sectors, whose experience spans investment, corporate finance, public accounting and corporate operating roles. 3 Table of Contents We believe that our management team is well positioned to identify an attractive target business within the consumer and consumer-related products and services industries and that their proprietary deal sourcing network, ranging from industry executives, private business owners, private equity investors, and investment bankers will enable us to pursue a broad range of opportunities across the entire consumer and consumer-related products and services industries globally. Our management believes that its ability to identify and implement operational value creation initiatives will remain central to its differentiated acquisition strategy. Additionally, our network and current affiliations will allow us to lean heavily on an existing infrastructure of resources that will assist in due diligence and ultimately structuring an acquisition. As indicated above, members of our management team were formerly members of the management team of Haymaker I and Haymaker II, and are members of the management team of Haymaker III. In connection with Haymaker I s initial business combination, Haymaker I shareholders exchanged their shares for shares in OneSpaWorld. Haymaker I management announced the business combination with OneSpaWorld on November 1, 2018, approximately 12 months after Haymaker I s initial public offering, and Haymaker I s stockholders approved the business combination approximately four and a half months later. Haymaker II announced its business combination with GPM and ARKO Holdings on September 9, 2020, approximately 15 months after Haymaker II s initial public offering, and Haymaker II s stockholders approved the business combination approximately three and a half months later. Haymaker III completed its $317.5 million initial public offering in March 2021 and is currently in the process of an initial business combination with BioTE Holdings, LLC. Our management team raised equity facilities (incremental to Haymaker I and Haymaker II s capital in trust) and new debt facilities to successfully complete the business combination for Haymaker I and Haymaker II. Past performance of our management team is not a guarantee either (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical performance record of our management as indicative of our future performance. In addition, for a list of our executive officers and entities for which a conflict of interest may or does exist between such officers and the company, as well as the priority and preference that such entity has with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under Management Conflicts of Interest . Business Strategy and Deal Origination Our acquisition and value creation strategy will be to identify, acquire and, after our initial business combination, build a company in the consumer or consumer-related products and services industries that complements the experience of our management team and can benefit from their global operational expertise. We do not intend to focus our efforts on any one geography and may pursue businesses that do not operate in the United States. Our business combination strategy will leverage our management team s network of potential proprietary and public transaction sources where we believe a combination of our relationships, knowledge and experience in the consumer and consumer-related products and services industries could effect a positive transformation or augmentation of existing businesses to improve their overall value proposition. We plan to utilize the network and industry experience of our Chief Executive Officer and our President and their affiliates, in seeking an initial business combination and employing our business combination strategy. Over the course of their careers, the members of our management team and their affiliates have developed a broad network of contacts and corporate relationships globally that we believe will serve as a useful source of acquisition opportunities. This network has been developed through our management team s: extensive experience in both investing in and operating in consumer and consumer-related products and services industries; marketing and growing these companies through experience engineering and de-commoditizing their services and products; experience in sourcing, structuring, acquiring, operating, developing, growing, financing and selling businesses; 4 Table of Contents relationships with sellers, financing providers and target management teams; and experience in executing transactions in the consumer and consumer-related products and services industries under varying economic and financial market conditions. We expect these networks will provide our management team with a robust flow of acquisition opportunities. In addition, we anticipate that target business candidates will be brought to our attention from various unaffiliated sources, which may include investment market participants, private equity groups, investment banking firms, consultants, accounting firms and large business enterprises. Upon completion of this offering, members of our management team intend to communicate with their networks of relationships to articulate the parameters for our search for a target company and a potential business combination and begin the process of pursuing and reviewing potentially interesting leads. Business Combination Criteria Consistent with this strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire companies that we believe: have market and/or cost leadership positions in their respective consumer or consumer-related products and services niches and would benefit from our extensive networks and insights within the consumer and consumer-related products and services industries; provide enduring products, content, or services, with the potential for revenue, market share and/or distribution improvements; are fundamentally sound companies that are underperforming their potential and offer compelling value; offer the opportunity for our management team to partner with established target management teams or business owners to achieve long-term strategic and operational excellence, or, in some cases, where our access to accomplished executives and the skills of the management of identified targets warrants replacing or supplementing existing management; exhibit unrecognized value or other characteristics, desirable returns on capital, and a need for capital to achieve the company s growth strategy, that we believe have been misevaluated by the marketplace based on our analysis and due diligence review; and will offer an attractive risk-adjusted return for our shareholders. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. Our officers and directors may become officers or directors of any other blank check company prior to completion of our initial business combination. In particular, two of our executive officers also currently serve in officer and/or director capacities at TMKR, which is searching for a target business in the restaurant, hospitality and related technology and service sectors, and at AFAQ, which is searching for a target business in the food and beverage, health and wellness, beauty, personal care and pet industries. In addition, three of our executive officers serve in officer and director capacities at Haymaker III, which is in the process of an initial business combination with BioTE Holdings, LLC. Our Chief Financial Officer is also an advisor for two other blank check companies searching for target. As a result, our officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. 5 Table of Contents Initial Business Combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account). We refer to this as the 80% fair market value test. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or from another independent entity that commonly renders valuation opinions, with respect to the satisfaction of such criteria. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination, although there is no assurance that will be the case. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders will own shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If our initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all the target businesses. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal 6 Table of Contents year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the last day of the most recently completed second fiscal quarter, or (2) our annual revenues exceed $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the last day of the most recently completed second fiscal quarter. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Our executive offices are located at 501 Madison Avenue, Floor 5, New York, NY 10022 and our phone number is (212) 616-9600. 7 Table of Contents The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 31 of this prospectus. Securities offered 26,100,000 units, at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one-third of one redeemable warrant. Proposed Nasdaq Symbols Units: HYIVU Class A common stock: HYIV Warrants: HYIVW Trading commencement and separation of shares of Class A common stock and warrants The units are expected to begin trading on or promptly after the date of this prospectus. The shares of Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless the Representatives inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K that includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to reflect the exercise of the underwriters over-allotment option. 8 Table of Contents Units: Number outstanding before this offering 0 Number outstanding after this offering 26,100,000(1) Common Stock: Number outstanding before this offering 7,503,750(2)(3) Number outstanding after this offering 32,625,000(1)(3)(4) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 12,400,000(1) Number of warrants to be outstanding after this offering and the private placement 21,100,000(1) Exercisability Each whole warrant offered in this offering is exercisable to purchase one share of Class A common stock. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-third of one warrant, with each whole warrant exercisable for one share of Class A common stock, as compared to units issued by some other similar special purpose acquisition companies which contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of a business combination as compared to units that each contain a whole warrant to purchase one whole share. We believe this structure will make us a more attractive business combination partner for target businesses. ____________ (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture of 978,750 founder shares by our initial stockholders for no consideration. (2) Includes up to 978,750 founder shares that will be forfeited by our initial stockholders depending on the extent to which the underwriters over-allotment option is exercised. (3) Founder shares are currently classified as shares of Class B common stock, which shares will automatically convert into shares of Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. (4) Includes 26,100,000 public shares and 6,525,000 founder shares. 9 Table of Contents Exercise price $11.50 per share, subject to adjustments as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial stockholders or their affiliates, without taking into account any founder shares held by our initial stockholders or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day after the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price (See Redemption of Warrants). Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, and 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement, including as a result of a notice of redemption). If and when the warrants become redeemable by us, we may exercise our redemption right even if we do not register or qualify the underlying securities for sale under all applicable state securities laws. 10 Table of Contents We are not registering the shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC and have an effective registration statement covering the shares of Class A common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if our shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last reported sale price (the closing price ) of our Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing once the warrants become exercisable and ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. 11 Table of Contents We will not redeem the warrants as described above unless a registration statement under the Securities Act covering the Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. None of the private placement warrants will be redeemable by us for cash so long as they are held by the initial purchasers of the private placement warrants or their permitted transferees. Founder shares On February 22, 2021, our sponsor subscribed to purchase an aggregate of 8,625,000 founder shares in exchange for a capital contribution of $25,000, or approximately $0.003 per share. On January 8, 2022, our sponsor returned to us, for no consideration, an aggregate of 1,121,250 founder shares, which we cancelled resulting in an aggregate of 7,503,750 founder shares outstanding and held by our sponsor. Prior to the initial investment in the company of $25,000 by the sponsor, the company had no assets, tangible or intangible. The per share price of the founder shares was determined by dividing the amount of cash contributed to the company by the number of founder shares issued. The number of founder shares outstanding was determined based on the expectation that the total size of this offering would be a maximum of 30,015,000 units if the underwriters over-allotment option is exercised in full, and therefore that such founder shares would represent 20% of the outstanding shares after this offering. Up to 978,750 of the founder shares will be forfeited depending on the extent to which the underwriters over-allotment option is not exercised. If we increase or decrease the size of the offering pursuant to Rule 462(b) under the Securities Act, we will effect a stock dividend or share contribution back to capital or other appropriate transaction, as applicable, with respect to our Class B common stock immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial stockholders, on an as-converted basis, at 20.0% of our issued and outstanding common stock upon the consummation of this offering. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; 12 Table of Contents our initial stockholders, sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to any founder shares and public shares they hold in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to any founder shares and public shares they hold in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to provide redemption rights to holders of public shares as described in this prospectus or with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within 18 months from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public stockholders for a vote, our initial stockholders have agreed to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need 9,787,501, or 37.5% (assuming all outstanding shares are voted and the over-allotment option is not exercised) or 1,631,251, or 5% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 26,100,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised); and the founder shares are automatically convertible into our Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described below adjacent to the caption Founder shares conversion and anti-dilution rights. 13 Table of Contents Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (i) one year after the completion of our initial business combination and (ii) the date on which we complete a liquidation, merger, capital stock exchange or other similar transaction after our initial business combination that results in all of our stockholders having the right to exchange their Class A common stock for cash, securities or other property; except to certain permitted transferees and under certain circumstances as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants . Any permitted transferees will be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, if the closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, the founder shares will be released from the lock-up. Founder shares conversion and anti-dilution rights The founder shares will automatically convert into shares of Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class A common stock or equity-linked securities are issued or deemed issued in connection with our initial business combination, the number of shares of Class A common stock issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the total number of shares of Class A common stock outstanding after such conversion (after giving effect to any redemptions of shares of Class A common stock by public stockholders), including the total number of shares of Class A common stock issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any shares of Class A common stock or equity-linked securities or rights exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in the initial business combination and any private placement warrants issued to our sponsor, officers or directors upon conversion of working capital loans, provided that such conversion of founder shares will never occur on a less than one-for-one basis. Voting Rights Holders of record of our Class A common stock and holders of record of our Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders, with each share of common stock entitling the holder to one vote except as required by law. 14 Table of Contents Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 12,400,000 private placement warrants (or 13,183,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of Class A common stock at $11.50 per share, at a price of $1.00 per warrant, or $12,400,000 in the aggregate (or $13,183,000 if the underwriters over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. A portion of the purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the trust account such that at the time of closing of this offering $266.22 million (or $306.2 million if the underwriters exercise their over-allotment option in full) will be held in the trust account. If we do not complete our initial business combination within 18 months from the closing of this offering, the private placement warrants will expire worthless. The private placement warrants will be non-redeemable and exercisable on a cashless basis so long as they are held by their initial purchasers or their permitted transferees (except as described below under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants ). If the private placement warrants are held by holders other than their initial purchasers or their permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Transfer restrictions on private placement warrants The private placement warrants (including the Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants. Cashless exercise of private placement warrants If holders of private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of our Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of our Class A common stock underlying the warrants, multiplied by the excess of the sponsor exercise fair market value (defined below) over the exercise price of the warrants by (y) the sponsor exercise fair market value. The sponsor exercise fair market value shall mean the average reported closing price of our Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that restrict insiders from selling our securities except during specific periods. 15 Table of Contents Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. After deducting $5,220,000 in underwriting discounts and commissions payable upon the closing of this offering and an aggregate of $1.96 million to pay expenses in connection with the closing of this offering and for working capital following this offering, $266.22 million, or $306.2 million if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case) of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee. The proceeds to be placed in the trust account include $9,135,000 (or up to $11,288,250 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, the proceeds from this offering and the sale of the private placement warrants will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering, subject to applicable law, and (iii) the redemption of our public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to allow holders of public shares to redeem their shares as described in this prospectus or with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Expression of Interest Cantor has informed us that it and/or its affiliates or accounts over which it and/or its affiliates have discretionary authority have expressed an interest in purchasing up to 7.5% of the units to be sold in this offering. However, because indications of interest are not binding agreements or commitments to purchase and are simply expressions of intent, these entities may determine to purchase fewer or no units at all in the offering or may purchase more units than they indicate an interest in purchasing (although they do not intend to exceed 9.99% ownership in the aggregate). In addition, Cantor may determine to allocate fewer units to any of these entities than the entities indicate an interest in purchasing or to not sell any units to these entities. The underwriters will receive the same underwriting discount on any units purchased by these entities as they will on any other units sold to the public in this offering. If Cantor or any of its affiliates or accounts over which it and/or its affiliates have discretionary authority purchases any units in this offering or otherwise in the open market, it has no obligation to vote the underlying shares in favor of any business combination, nor does it have an obligation not to redeem any such shares or hold any such 16 Table of Contents units or underlying shares beyond the completion of an initial business combination, if any. Any trading decisions made by any of the foregoing entities will be made by them based on market conditions at the time of the proposed sale or redemption. Cantor s affiliates will not receive any economic or other interest in our sponsor. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except for taxes pyable and/or to redeem our public shares in connection with an amendment to our amended and restated certificate of incorporation, as described above. The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We estimate the interest earned on the trust account will be approximately $266,220 per year, assuming an interest rate of 0.1% per year; however we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from such interest withdrawn from the trust account and: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which initially will be approximately $1,385,000 in working capital after the payment of approximately $575,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Conditions to completing our initial business combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. We anticipate structuring our initial business combination so that the post transaction company in which 17 Table of Contents our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons. There is no limitation on our ability to raise funds privately, or through loans in connection with our initial business combination including pursuant to forward purchase agreements we may enter into following consummation of this offering. We will complete our initial business combination only if the post-transaction company in which our public stockholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% fair market value test described above, provided that in the event that the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as our initial business combination for purposes of a seeking stockholder approval or conducting a tender offer, as applicable. Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, executive officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with 18 Table of Contents such rules. We expect any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. See Proposed Business Permitted purchases of our securities for a description of how our sponsor, initial stockholders, directors, executive officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the business combination and thereby increase the likelihood of obtaining stockholder approval of the business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.20 per public share. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our initial stockholders, sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares they hold and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. 19 Table of Contents Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the business combination or (ii) without a stockholder vote by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and share purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding Class A common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with the Nasdaq s shareholder approval rules. The requirement that we provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above will be contained in provisions of our amended and restated certificate of incorporation and will apply whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of 50% of our common stock entitled to vote thereon. If we provide our public stockholders with the opportunity to redeem their public shares in connection with a stockholder meeting, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our initial stockholders, sponsor, officers and directors have agreed to vote any founder shares they hold and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once 20 Table of Contents a quorum is obtained. As a result, in addition to our initial stockholders founder shares, we would need only 9,787,501, or 37.5% (assuming all outstanding shares are voted and the over-allotment option is not exercised) or 1,631,251, or 5% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 26,100,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised). These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction or whether they were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than the number of public shares we are permitted to redeem. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. 21 Table of Contents We intend to require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to, at the holder s option, either deliver their stock certificates to our transfer agent or deliver their shares to our transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the date on which the vote on the proposal to approve the initial business combination is to be held. In addition, if we conduct redemptions in connection with a stockholder vote, we may require a public stockholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. The proxy materials that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates or shares delivered by public stockholders who elected to redeem their shares. Our amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for: (i) cash consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares in connection with such initial business combination, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. 22 Table of Contents Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination, to pay the representatives of the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. 23 Table of Contents Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation provides that we will have only 18 months from the closing of this offering to complete our initial business combination. If we do not complete our initial business combination within such 18-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject, in the case of clauses (ii) and (iii) above, to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 18-month time period. Our initial stockholders have entered into agreements with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 18 months from the closing of this offering. However, if our initial stockholders or management team acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 18-month time frame. The representatives of the underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within 18 months from the closing of this offering and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. 24 Table of Contents Our initial stockholders, sponsor, executive officers, directors and director nominees have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then outstanding public shares, subject to the limitations described above under Limitations on redemptions. For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A of the Exchange Act seeking stockholder approval of such proposal, and in connection therewith, provide our public stockholders with the redemption rights described above upon stockholder approval of such amendment. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent auditors) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.20 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. Because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only third parties we currently expect to engage would be vendors such as lawyers, investment bankers, accountants, computer or information and technical services providers or prospective target businesses. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. We have not asked our sponsor to reserve for such obligations. We therefore believe it is unlikely our sponsor would be able to satisfy any indemnification obligations that may arise. 25 Table of Contents Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made to our sponsor, officers or directors, or our or their affiliates, and, if made prior to our initial business combination will be made from funds held outside the trust account: repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; payment of $20,000 per month for office space, utilities, secretarial and administrative services provided to members of our management team by an affiliate of our sponsor; reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and repayment of non-interest bearing loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors as and when required by the Nasdaq rules and Rule 10A-3 of the Exchange Act, to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. 26 Table of Contents Conflicts of Interest Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. In addition, our officers and directors may become officers or directors of any other blank check company prior to completion of our initial business combination. In particular, two of our officers currently serve in officer and/or director capacities at TMKR, which is searching for a target business in the restaurant, hospitality and related technology and service sectors, and AFAQ, which is searching for a target business in the food and beverage, health and wellness, beauty, personal care and pet industries. Such individuals may simultaneously pursue opportunities for TKMR, AFAQ and for us. In addition, three of our officers currently serve in officer and director capacities at Haymaker III, which is in the process of an initial business combination with BioTE Holdings, LLC. As such, these individuals may simultaneously pursue opportunities for Haymaker III, if it does not complete its initial business combination with BioTE Holdings, LLC, and us. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. 27 Table of Contents Summary of Risk Factors Our business is subject to numerous risks and uncertainties, including those highlighted in the section title Risk Factors, that represent challenges that we face in connection with the successful implementation of our strategy. The occurrence of one or more of the events or circumstances described in the section titled Risk Factors, alone or in combination with other events or circumstances, may adversely affect our ability to effect a business combination, and may have an adverse effect on our business, cash flows, financial condition and results of operations. Such risks include, but are not limited to the following: We are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by our management team and their affiliates, including investments and transactions in which they have participated and businesses with which they have been associated, may not be indicative of future performance of an investment in the company. Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, and even if we hold a vote, holders of our founder shares will participate in such vote, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. Your only opportunity to effect your investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash. If we seek stockholder approval of our initial business combination, our initial stockholders and management team have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. we may issue our shares to investors in connection with our initial business combination at a price that is less than the prevailing market price of our shares at that time. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. The requirement that we complete our initial business combination within 18 months after the closing of this offering may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders. The coronavirus, or COVID-19, pandemic, including the efforts to mitigate its impact, has and may continue to have a material adverse effect on our search for a business combination, as well as any target business with which we ultimately consummate a business combination. We may not be able to complete our initial business combination within 18 months after the closing of this offering, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate. 28 Table of Contents If we seek stockholder approval of our initial business combination, our sponsor, initial stockholders, directors, officers, advisors and their affiliates may elect to purchase shares or public warrants from public stockholders, which may influence a vote on a proposed business combination and reduce the public float of our Class A common stock or public warrants. If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for submitting or tendering its shares, such shares may not be redeemed. You will not be entitled to protections normally afforded to investors of many other blank check companies. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are unable to complete an initial business combination, our public stockholders may receive only their pro rata portion of the funds in the trust account that are available for distribution to public stockholders, and our warrants will expire worthless. 29 Table of Contents
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+This summary highlights selected information appearing elsewhere in this prospectus. Because it is a summary, it may not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus carefully, including the information set forth under the heading Risk Factors and our financial statements. The Company We specialize in the research and development of integrated silicon photonics chipsets and have developed a comprehensive range of silicon photonics technologies that have both the power and the flexibility to support a wide range of potential applications. Our silicon-phonics platform will incorporate several key components to support these solutions, including photonic integrated circuits and associated modules, sensors, and end-to-end solutions. We expect that our immediate focus over the next two years will be on developing and commercializing our products for incorporation in consumer wearables, medical devices, and dedicated solutions for the healthcare market. On August 11, 2021, Rockley, Rockley UK, and SC Health consummated the Business Combination pursuant to the Business Combination Agreement dated as of March 19, 2021 among Rockley, SC Health, Rockley UK and Merger Sub. Rockley was deemed to be the accounting acquirer in the Merger based on an analysis of the criteria outlined in Accounting Standards Codification 805. Accordingly, the historical financial statements of Rockley UK became the historical financial statements of the combined company, upon the consummation of the Merger. Pursuant to the Business Combination Agreement, each of the following transactions occurred in the following order: (i) pursuant to a scheme of arrangement approved by the UK courts (the Scheme ), all of Rockley UK s ordinary shares, including shares issued immediately prior to the Scheme becoming effective as a result of the conversion of then-outstanding convertible loan notes and the exercise of warrants, were transferred by Rockley UK shareholders in exchange for an equivalent number of shares in Rockley; (ii) the holders of options to purchase shares in Rockley UK rolled over their options into new options to purchase shares in Rockley; (iii) warrants to purchase shares in Rockley UK (other than one warrant instrument that by its terms was replicated at Rockley) not exercised for shares in Rockley UK prior to the effectiveness of the Scheme described above were cancelled, such that immediately following the Scheme, Rockley UK became a direct wholly owned subsidiary of Rockley; (iv) Rockley completed a stock split to prepare its share capital for Merger Sub s merger into SC Health; (v) certain investors (including entities affiliated with the Sponsor) purchased an aggregate of $150,000,000 of ordinary shares in Rockley pursuant to the PIPE financing that was completed in connection with the Business Combination; (vi) on August 11, 2021, Merger Sub was merged with and into SC Health, with SC Health surviving the merger and becoming a direct wholly owned subsidiary of Rockley; and (vii) the ordinary shares and warrants in SC Health were exchanged for ordinary shares and warrants in Rockley. Our ordinary shares and publicly traded warrants (the Public Warrants ) are currently listed on the New York Stock Exchange ( NYSE ) under the symbols RKLY and RKLY.WS, respectively. The rights of holders of our ordinary shares are governed by our Second Amended and Restated Memorandum and Articles of Association (the Articles of Association ), and the laws of the Cayman Islands. See the sections entitled Description of Our Securities. Corporate Information Rockley was incorporated in the Cayman Islands in March 2021 to facilitate the Business Combination. Rockley Photonics Limited was founded in 2013 in the United Kingdom. SC Health was incorporated in the Cayman Islands in December 2018 as a special purpose acquisition company, formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or more businesses. SC Health completed its initial public offering in July 2019. In August 2021, Rockley Mergersub Limited, a wholly owned subsidiary of Rockley, merged with and into SC Health (which was subsequently renamed Rockley Photonics Cayman Limited) and securityholders of Rockley UK exchanged their securities in Rockley UK for ordinary shares of Rockley, with each of Rockley UK and SC Health surviving the merger as a wholly owned subsidiary of Rockley. Our principal executive offices are located at 3rd Floor, 1 Ashley Road, Altrincham, Cheshire, United Kingdom. Our telephone number is +44 (0) 1865 292017. Our website address is www.rockleyphotonics.com. Information contained on our website or connected thereto does not constitute part of, and is not incorporated by reference into, this prospectus or the registration statement of which it forms a part. Implications of Being an Emerging Growth Company and a Smaller Reporting Company We qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As an emerging growth company, we intend to take advantage of certain exemptions from specified disclosure and other requirements that are otherwise generally applicable to public companies. These exemptions include: not being required to comply with the auditor attestation requirements for the assessment of our internal control over financial reporting provided by Section 404 of the Sarbanes-Oxley Act of 2002; reduced disclosure obligations regarding executive compensation; and not being required to hold a nonbinding advisory vote on executive compensation or seek shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these provisions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company upon the earliest to occur of (1) the last day of the fiscal year (a) following the fifth anniversary of the date of the first sale of common equity securities pursuant to an effective registration statement, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market SUBJECT TO COMPLETION, DATED JULY 11, 2022 PROSPECTUS Rockley Photonics Holdings Limited Up to 87,567,895 Ordinary Shares This prospectus relates to the offer and sale from time to time of up to 87,567,895 ordinary shares, nominal value $0.000004026575398 per share, (the ordinary shares ) of Rockley Photonics Holdings Limited, a Cayman Islands exempted company ( Rockley, the Company, we, or us ), by the selling shareholders named in this prospectus or their donees, pledgees, transferees, or other successors in interest, including those who receive any of the shares as a gift, pledge, distribution, redemption, repurchase, cancellation, or other non-sale related transfer (the selling shareholders ), which includes (i) up to 40,316,038 ordinary shares issuable upon conversion of the Company s Convertible Senior Secured Notes due 2026 (the Notes ) (which amount consists of (A) 26,461,038 ordinary shares initially issuable upon conversion of all of the Notes at a conversion price of $3.08 per ordinary share and (B) an additional 13,855,000 ordinary shares that would have become due in connection therewith assuming that the Notes were converted on the date they were issued and the interest make-whole payment (as defined in the Indenture) that would have become due in connection therewith was paid by the Company in ordinary shares on that date) and (ii) up to 47,251,857 ordinary shares issuable upon the exercise of all the Company s warrants (the 144A Warrants ) (which amount consists of (A) 26,461,038 ordinary shares initially issuable upon the exercise of all of the 144A Warrants at an exercise price of $5.00 per ordinary share and (B) an additional 20,790,819 ordinary shares that, together with 26,461,038 ordinary shares, would be issuable upon the exercise of all of the 144A Warrants in connection with a ratchet anti-dilution adjustment as provided in the 144A Warrants at an assumed exercise price of $2.80 per ordinary share (the floor price for such ratchet anti-dilution adjustment) as a result thereof), in each case, issued in a private placement to the selling shareholders that closed on May 27, 2022 (the private placement financing ). Under certain circumstances as set forth in the Indenture, ordinary shares could be issued in connection with a conversion of interest that may be paid in kind as well as additional ordinary shares that would be issuable if a holder of Notes elected to convert its Notes in connection with a make-whole fundamental change (as defined in the Indenture), but the aggregate number of ordinary shares issuable in these circumstances are expected to be less than the number of ordinary shares set forth in clause (i)(B) of the immediately preceding sentence. The number of ordinary shares issuable in connection with an interest make-whole payment (as defined in the Indenture), if any, or a ratchet anti-dilution adjustment, if any, represent good faith estimates only and the actual number of ordinary shares which may be issued, if any, may vary. The information in this prospectus is not intended to constitute an indication or prediction of (i) the date on which the selling shareholders or Rockley will convert the Notes into ordinary shares, or on which the selling shareholders will exercise the 144A Warrants, if at all, or (ii) if the interest make-whole payment (as defined in the Indenture) becomes due in connection with the conversion of any Note, whether Rockley would elect to make such payment in ordinary shares or have satisfied the conditions set forth in the Indenture to make such payment in ordinary shares. The Notes and the 144A Warrants are more fully described in the section entitled Prospectus Summary The Private Placement Financing We are registering the offer and sale of ordinary shares covered by this prospectus to satisfy certain registration rights we have granted pursuant to a registration rights agreement among Rockley and the selling shareholders. The selling shareholders may sell the ordinary shares covered by this prospectus in a number of different ways and at varying prices. We provide more information about how the selling shareholders may sell the ordinary shares in the section entitled Plan of Distribution. We will not receive any proceeds from the sale of ordinary shares by the selling shareholders pursuant to this prospectus. We will pay certain expenses associated with the registration of the securities covered by this prospectus, as described in the section entitled Plan of Distribution. In connection with any sales of securities offered hereunder, the selling shareholders, and any underwriters, agents, brokers or dealers participating in such sales may be deemed to be underwriters within the meaning of the Securities Act of 1933, as amended (the Securities Act ). Our registration of the securities covered by this prospectus does not mean that the selling shareholders will offer or sell any of the ordinary shares. We are an emerging growth company and a smaller reporting company as those terms are defined under the federal securities laws and, as such, have elected to comply with certain reduced public company disclosure and reporting requirements. Our ordinary shares are listed on the New York Stock Exchange under the symbol RKLY. On July 5, 2022, the closing price of our ordinary shares was $2.41 per share. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 7 of this prospectus and under similar headings in any amendments or supplements to this prospectus to read about factors you should consider before buying our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS All statements in this prospectus that are not historical in nature constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements regarding the financial position, business strategy, plans and objectives of management, as well as Rockley s product development plans and timeline and anticipated customer and strategic relationships, and are not guarantees of performance. When used in this prospectus, the words anticipate, believe, can, continue, could, developing, enable, estimate, eventual, expand, expect, focus, future, goal, intend, may, might, opportunity, outlook, plan, possible, position, potential, predict, project, revolutionize, seem, should, trend, will, would or other terms that predict or indicate future events, trends, or expectations, and similar expressions or the negative of such expressions may identify forward-looking statements, but the absence of these words or terms does not mean that a statement is not forward-looking. Forward-looking statements in this prospectus include, but are not limited to, statements regarding the following: Rockley s financial and business performance, including anticipated financial outlook or information and business metrics; Rockley s strategy, future operations, financial position, estimated revenue and losses, projected costs, prospects and plans; the implementation, market acceptance, and success of Rockley s business model; developments and expectations relating to Rockley s competitors, target markets, and industry; Rockley s future capital requirements and sources and uses of cash; Rockley s ability to obtain funding for its product development plans, execution of its business strategy, and its operations; Rockley s business, product development plans, and opportunities; the outcome of any known and unknown litigation and regulatory proceedings; Rockley s anticipated financial outlook or information, anticipated growth rate, and market opportunities; Rockley s plans to commercialize its products and services, and anticipated timing thereof; Rockley s expectations as to when it may generate additional revenue and/ or sufficient revenue from the sale of its products and services to cover expansion plans, operating expenses, working capital, and capital expenditures; the development status and anticipated timeline for commercial production of Rockley s products; Rockley s plans for products under development and future products and anticipated features and benefits thereof; the status and expectations regarding Rockley s customer and strategic partner, and potential customer and strategic partner, relationships; the total addressable markets for Rockley s products and technology; the ability of Rockley to increase market share in its existing markets or any new markets it may enter; Rockley s ability to obtain any required regulatory approvals, including any required Food and Drug Administration ( FDA ) approvals, in connection with its anticipated products and technology; Rockley s ability to maintain an effective system of internal control over financial reporting; Rockley s ability to maintain and protect its intellectual property; Rockley s success in retaining or recruiting, or managing any transitions among, officers, key employees, or directors; the ability of Rockley to manage its growth effectively; the ability of Rockley to achieve and maintain profitability in the future; the impact of the regulatory environment and complexities with compliance related to such environment; the impact of the COVID-19 pandemic; and Rockley s ability to comply with the affirmative and restrictive covenants in its debt agreements and the potential dilutive impact of any such debt agreements. The forward-looking statements contained in this prospectus are based on various assumptions, whether or not identified in this prospectus, and on Rockley s current expectations, beliefs, and assumptions and are not predictions of actual performance. These forward-looking statements involve a number of risks, uncertainties (many of which are beyond Rockley s control), or other assumptions that may cause actual results or performance to differ materially from those expressed or implied by these forward-looking statements. We discuss many of these risks and uncertainties in greater detail under the section entitled Risk Factors contained in this prospectus and in our SEC filings. If any of these risks or uncertainties materialize, or should any of these assumptions prove incorrect, actual results may differ materially from those discussed in or implied by these forward-looking statements. There can be no assurance that future developments affecting Rockley will be those that have been anticipated. Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements. Additional cautionary statements or discussions of risks and uncertainties that could affect our results or the achievement of the expectations described in forward-looking statements may also be contained in any accompanying prospectus supplement. These forward-looking statements made by us in this prospectus and any accompanying prospectus supplement speak only as of the date of this prospectus and any accompanying prospectus supplement. Except as required under the federal securities laws and rules and regulations of the SEC, we expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. You should, however, review additional disclosures we make in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K filed with the SEC. value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. We are also deemed to be a smaller reporting company as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the Exchange Act ), and are thus allowed to provide simplified executive compensation disclosures in our SEC filings, will be exempt from the provisions of Section 404(b) of Sarbanes-Oxley requiring that an independent registered public accounting firm provide an attestation report on the effectiveness of internal control over financial reporting and will have certain other reduced disclosure obligations with respect to our SEC filings. We may choose to take advantage of some or all of these accommodations. We have taken advantage of reduced reporting requirements in this prospectus. Accordingly, the information contained herein may be different from the information you receive from U.S. public companies that do not qualify as an emerging growth company or a smaller reporting company. For additional details see Risk Factors We qualify as an emerging growth company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to emerging growth companies, it could make our securities less attractive to investors and may make it more difficult to compare our performance to the performance of other public companies. Risk Factors Summary Rockley s business and its ability to execute its strategy, and any investment in its securities are subject to risks and uncertainties, many of which are beyond Rockley s control. You should carefully consider and evaluate all of the risks and uncertainties with respect to any investment in the securities of Rockley, including, but not limited to, the following and those discussed under Risk Factors. References below to Rockley shall be deemed to also refer to Rockley and its subsidiaries, as the context requires or as appropriate. Risks Related to Rockley s Business and Industry If Rockley does not fully develop or commercialize its products and services, or if such products and services experience significant delays, Rockley s business, financial condition, and results of operation will be materially and adversely affected. Rockley has a history of recurring losses and a significant accumulated deficit, which raises substantial doubt about its ability to continue as a going concern. Rockley expects to incur significant research and development expenses and devote substantial resources to commercializing new products, which could increase its losses and negatively impact its ability to achieve or maintain profitability. If the end products into which Rockley s products are incorporated are not fully developed and commercialized or do not achieve widespread market acceptance, or if such products experience delays, cancellations, or reductions, or if Rockley s products are not selected for inclusion in its customers end products, are not adopted in other industry verticals or use cases, or are not adopted by leading consumer and medical device companies, Rockley s business will be materially and adversely affected. Rockley s estimates and expectations as to its financial performance are based upon assumptions, analyses, and internal estimates developed by Rockley s management. If these assumptions, analyses, or estimates prove to be incorrect or inaccurate, Rockley s actual operating results may differ materially from any such estimates and expectations. Rockley expects its results of operations to fluctuate on a quarterly and annual basis, which could cause Rockley s stock price to fluctuate or decline. If Rockley is unable to manage its growth or scale its operations, its business and operating results could be materially and adversely affected. Market opportunity estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. Rockley s international operations expose it to operational, financial, and regulatory risks, which could harm Rockley s business. Rockley is susceptible to supply shortages, long lead times for components, and supply changes, any of which could disrupt its supply chain and could delay deliveries of its products to customers, which in turn could adversely affect Rockley s business, results of operations, and financial condition. Rockley s business depends substantially on the efforts of its executive officers, including its Chief Executive Officer and founder, Dr. Andrew Rickman. Customer-Related Risks If Rockley is unable to sell its products to its target customers, including large corporations with substantial negotiating power, or is unable to enter into agreements with customers and suppliers on satisfactory terms, its prospects and results of operations will be adversely affected. Rockley currently depends on a few large customers for a substantial portion of its revenue. The loss of, or a significant reduction in, orders from Rockley s customers, or Rockley s failure to diversify its customer base, could significantly reduce its revenue and adversely impact Rockley s operating results. Because Rockley does not anticipate long-term purchase commitments with its customers, orders may be cancelled, reduced, or rescheduled with little or no notice, which in turn exposes Rockley to inventory risk, and may cause its business and results of operations to suffer. Risks Related to Rockley s Debt Financing Rockley is subject to restrictive debt covenants that may limit its ability to finance its future operations and capital needs and to pursue business opportunities and activities. We have a significant number of securities outstanding that can be converted into, or exercised for, ordinary shares and certain of our outstanding warrants contain anti-dilution protection, all which may cause significant dilution to our shareholders, have a material adverse impact on the market price of our ordinary shares and make it more difficult for us to raise funds through future equity offerings. You should read this prospectus and any accompanying prospectus supplement completely and with the understanding that our actual future results, levels of activity and performance as well as other events and circumstances may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Our existing and future indebtedness, including the Notes, restricts our ability to raise additional capital to fund our operations and repay our debt including the Notes and limits our ability to react to changes in the economy or the technology industry. Regulatory, Intellectual Property, Infrastructure, Cybersecurity and Privacy Risks Rockley s failure to comply with applicable governmental export and import control laws and regulations, including those related to the use, distribution, and sale of its products, FDA clearance or approval requirements, or privacy, data protection, and information security requirements in the jurisdictions in which Rockley operates could materially harm its business and operating results. Rockley may not be able to adequately protect or enforce its intellectual property rights or prevent unauthorized parties from copying or reverse engineering its products or technology. Further, Rockley s intellectual property applications, including patent applications, may not be approved or granted. A network or data security incident or disruption or performance issues with Rockley s network infrastructure could harm its brand, reputation, and business, as well as its operating results. Risks Related to Financial and Accounting Matters Rockley s failure to raise additional capital or generate the significant capital necessary to expand its operations could reduce its ability to compete and could harm its business. In preparing Rockley s consolidated financial statements, Rockley makes good faith estimates and judgments that may change or turn out to be erroneous, which could adversely affect Rockley s operating results. Risks Related to Being a Public Company, Rockley s Ordinary Shares, and General Risks Rockley s ordinary shares may not remain eligible for listing on the NYSE. Rockley may be required to take write downs or write offs, or may be subject to restructuring, impairment or other charges that could have a significant negative effect on Rockley s financial condition, results of operations and the market price of Rockley s ordinary shares. Rockley s share price may be volatile and sales of substantial volumes of our ordinary shares into the public market or the perception that such sales may occur could cause our share price to decline, including substantially. If analysts do not publish or cease publishing research or reports about Rockley or if they change their recommendations regarding Rockley s securities, the price and trading volume of Rockley s securities could decline. The requirements of being a public company may strain Rockley s resources, divert management s attention, and affect its ability to attract and retain qualified board members. The global COVID-19 pandemic could harm Rockley s business, financial condition, results of operations, and prospects. Investing in our securities entails a high degree of risk as more fully described in the Risk Factors section of this prospectus beginning on page 7. You should carefully consider such risks before deciding to invest in our securities. THE PRIVATE PLACEMENT FINANCING On May 26, 2022, the Company, together with its subsidiaries named therein, entered into an amended and restated subscription agreement (the Subscription Agreement ) with the selling shareholders, relating to the sale by the Company to the selling shareholders of $81.5 million aggregate principal amount of Convertible Senior Secured Notes due 2026 (the Notes ) and the 144A Warrants to purchase 26,461,038 ordinary shares at an exercise price of $5.00 per share, subject to certain anti-dilution adjustments. The Notes are convertible at an initial conversion price equal to $3.08 per ordinary share and subject to certain customary anti-dilution adjustments. The Company has also granted the selling shareholders an overallotment option (the Overallotment Option ) to purchase up to an additional $81.5 million aggregate principal amount of Notes (the Additional Notes ) and additional 144A Warrants to purchase up to 26,461,038 ordinary shares (the Additional 144A Warrants ), subject to certain anti-dilution adjustments, from such date until the date that is 12 months following the date that a registration statement covering the ordinary shares issuable upon conversion of the Notes and upon exercise of the 144A Warrants becomes effective. The Notes and the 144A Warrants were issued on May 27, 2022 pursuant to an exemption under Section 4(a)(2) of the Securities Act. This prospectus relates to the resale from time to time of up to 87,567,895 ordinary shares, including (i) up to 40,316,038 ordinary shares issuable upon conversion of the Notes (assuming that the Notes were converted on the date they were issued and the interest make-whole payment (as defined in the Indenture) that would become due in connection therewith was paid by the Company in ordinary shares on that date) and (ii) up to 47,251,857 ordinary shares issuable upon the exercise of the 144A Warrants (assuming that an additional 20,790,819 ordinary shares would be issuable upon the exercise of all of the 144A Warrants in connection with a ratchet anti-dilution adjustment as provided in the 144A Warrants at an assumed exercise price of $2.80 per ordinary share (the floor price for such ratchet anti-dilution adjustment) as a result thereof). The registration statement of which this prospectus forms a part does not cover any ordinary shares issuable upon conversion of the Additional Notes or exercise of the Additional 144A Warrants. The Company also entered into a Registration Rights Agreement (the Registration Rights Agreement ), dated May 27, 2022, with the selling shareholders, which provides, subject to certain limitations, the selling shareholders with certain registration rights for the ordinary shares issuable upon conversion of the Notes (including ordinary shares issuable if the Company elects, and is permitted thereunder, to pay the interest make-whole payment (as defined in the Indenture) that may become due in connection therewith in ordinary shares) and exercise of the 144A Warrants. The registration statement of which this prospectus forms a part is being filed in connection with the Company's obligations under the Registration Rights Agreement. The Registration Rights Agreement requires the Company to prepare and file a registration statement with the SEC as soon as reasonably practicable after the issuance of the Notes and the 144A Warrants to register the resale of the shares underlying the Notes and the 144A Warrants. Subject to the terms of the Registration Rights Agreement, the Company is required to use its commercially reasonably efforts to cause such registration statement to be declared effective under the Securities Act as promptly as possible after the filing thereof, and to cause such registration statement to remain continuously effective until all securities INDUSTRY AND MARKET DATA In this prospectus, we rely on and refer to industry data, information, and statistics regarding the markets in which we compete from research as well as from publicly available information, industry and general publications and research and studies conducted by third parties. We have supplemented this information where necessary with our own internal estimates, considering publicly available information about other industry participants and our management s best view as to information that is not publicly available. This information appears in Management s Discussion and Analysis of Financial Condition and Results of Operations, Business and other sections of this prospectus. We have taken such care as we consider reasonable in the extraction and reproduction of information from such data from third party sources. Industry publications, research, studies, and forecasts generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward-looking statements in this prospectus. These forecasts and forward-looking information are subject to uncertainty and risk due to a variety of factors, including those described under Risk Factors. These and other factors could cause results to differ materially from those expressed in the forecasts or estimates from independent third parties and us. covered by such registration statement (i) have been resold or (ii) may be resold without volume or manner-of-sale restrictions pursuant to Rule 144 under the Securities Act ( Rule 144 ) and without the requirement for the Company to be in compliance with the current public information requirement under Rule 144. If the Company fails to meet certain obligations under the Registration Rights Agreement, including timely filing and effectiveness of such resale registration statement or a failure to maintain continuous effectiveness of such resale registration statement for more than 10 calendar days, it will be obligated to pay liquidated damages to each selling shareholder in an amount of cash equal to the product of 2.0% multiplied by the aggregate purchase price paid by such selling shareholder under the Subscription Agreement monthly until such breach is cured. If the Company fails to pay any liquidated damages pursuant to the Registration Rights Agreements in full within seven days after the date payable, the Company will pay interest thereon at a rate of 18% per annum. The Notes The Notes were issued pursuant to an indenture (the Indenture ), dated as of May 27, 2022, among the Company, certain of its subsidiaries, as guarantors (the Guarantor Subsidiaries ), and Wilmington Savings Fund Society, FSB, as trustee (the Trustee ) and as collateral agent (the Collateral Agent ). The Notes are senior secured obligations of the Company and the Guarantor Subsidiaries secured by substantially all assets of the Company and each Guarantor Subsidiary. Interest on the Notes will be payable quarterly in arrears at a rate of 9.5% per annum if paid in cash or, subject to the satisfaction of certain conditions, at a rate of 12.0% per annum payable at a rate of 5.75% per annum in cash and 6.25% per annum through the issuance of additional Notes ( PIK Interest ), which will also bear interest. Interest on the Notes will be payable quarterly in arrears on February 15, May 15, August 15 and November 15, commencing on August 15, 2022, and unless the context otherwise requires, references herein to the Notes include any interest paid as PIK Interest. The Notes will mature on May 15, 2026 (the Maturity Date ) unless redeemed, repurchased or converted in accordance with their terms prior to such date. The Notes are convertible at an initial conversion price equal to $3.08 per ordinary share (the Conversion Price ) and subject to certain customary anti-dilution adjustments. Holders of the Notes have the right to convert all or a portion of their Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the Maturity Date and the right to receive additional ordinary shares if the Company elects, and is permitted thereunder, to pay the interest make-whole payment (as defined in the Indenture) that may become due in connection therewith in ordinary shares. Upon conversion, holders of the Notes will receive ordinary shares and cash for fractional interests and except in connection with certain events, an interest make-whole payment for interest that would have accrued from the date of conversion until the Maturity Date, which interest make-whole payment shall be paid in cash or subject to the satisfaction of certain conditions, in ordinary shares at the Company s election. The Company may redeem the Notes in whole, and not in part, at its option, at any time prior to the Maturity Date, for a cash purchase price equal to the aggregate principal amount of any Notes to be redeemed plus accrued and unpaid interest thereon plus a make-whole premium as provided in the Indenture. At any time prior to the Maturity Date, the Company may also redeem the Notes in whole, or from time to time in part, if the last reported sale price of the ordinary shares exceeds 250% of the conversion price then in effect and if the daily trading volume for ordinary shares on the NYSE exceeds 1,000,000 shares, in each case, for at least 20 trading days (which need not be consecutive), including at least one of the five trading days preceding the date on which the Company provides a notice for such redemption, during any 30 consecutive trading day period ending on, and including, the trading day preceding such notice date, for a cash purchase price equal to the aggregate principal amount of any Notes to be redeemed plus accrued and unpaid interest thereon. The Notes are also subject to redemption at the option of the Company in the event of certain changes in tax law or listing status of the Notes or the status of the relevant stock exchange on which the Notes may be listed as a recognised stock exchange for purposes of certain tax laws related to withholding on payments of interest. In addition, following certain corporate events that occur prior to the Maturity Date or following issuance by the Company of a notice of redemption, in each case as provided in the Indenture, in certain circumstances, the Company will increase the conversion rate for a holder who elects to convert its Notes in connection with such a corporate event or who elects to convert any Notes called for redemption during the related redemption period. Additionally, in the event of a fundamental change (such term as defined in the Indenture), holders of the Notes will have the right to require the Company to repurchase all or a portion of their Notes at a price equal to the aggregate principal amount of any Notes to be repurchased plus accrued and unpaid interest thereon plus a make-whole premium. The Indenture includes restrictive covenants that, subject to specified exceptions, limit the ability of the Company and its subsidiaries to, among other things, (a) incur debt or issue preferred shares or disqualified stock; (b) make (i) dividends and distributions, (ii) redemptions and repurchases of equity, (iii) investments and (iv) prepayments, redemptions and repurchases of subordinated debt; (c) incur liens; (d) make asset sales; (e) enter into transactions with affiliates, (f) issue or sell any ordinary shares, or any securities convertible into or exercisable for ordinary shares, at a price, or having a conversion or exercise price, that is less than the conversion price (as defined in the Indenture) on the Notes and (g) enter into agreements limiting subsidiary distributions. In addition, the Company is required to maintain minimum unrestricted cash and cash equivalents of $20.0 million. The Indenture also includes customary events of default after which the Trustee or the holders of 25% in aggregate principal amount of the Notes then outstanding may accelerate the maturity of the Notes to become due and payable immediately; provided, however, that the Notes will be automatically accelerated upon certain events of bankruptcy, insolvency and reorganization involving the Company or any of its subsidiaries. Such events of default include: (i) certain payment defaults on the Notes (which, in the case of a default in the payment of interest and liquidated damages on the Notes, will be subject to a 30-day cure period); (ii) the Company s failure in its obligation to convert a Note, if such default is not cured within three business days; (iii) the Company s failure to send certain notices under the Indenture within specified periods of time, if such failure is not cured within three business days; (iv) the Company s failure to comply with certain covenants in the Indenture restricting the Company s ability to consolidate with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially all of the assets of the Company and its subsidiaries, taken as a whole, to another person; (v) a default by the Company in its other obligations or agreements under the Indenture or the other note documents (as defined in the Indenture) if such default is not cured or waived within 30 days after written notice is given by the Trustee or the holders of 25% in aggregate principal amount of the Notes then outstanding; (vi) certain defaults by the Company or any of its subsidiaries with respect to indebtedness for borrowed money of at least $3,500,000; (vii) final judgments of at least $3,500,000 (excluding amounts not covered by insurance) rendered against the Company or any of its subsidiaries, which judgments are not discharged or stayed within 60 days; (viii) certain events of bankruptcy, insolvency or reorganization involving the Company or any of its subsidiaries; (ix) any guarantee in respect of the Notes ceases to be in full force and effect, other than in accordance with the Indenture, or any Guarantor Subsidiary denies or disaffirms its obligations under its guarantee in respect of the Notes or gives notice to such effect; (x) any material provision of any note document ceases to be valid and binding on or enforceable against the Company or any Guarantor Subsidiary or the Company or any Guarantor Subsidiary shall so state in writing or any note security document (as defined in the Indenture) ceases to create a valid security interest in the collateral (as defined in the Indenture), excepted as permitted pursuant to the terms thereof or the Indenture; and (xi) except as permitted under the Indenture, the Company or any Guarantor Subsidiary shall contest in any manner the validity or enforceability of a permitted intercreditor agreement (as defined in the Indenture) or deny that it has any further liability or obligation thereunder, or the note obligations or the liens securing the note obligations, for any reason shall not have the priority contemplated by the Indenture, the note security documents or such permitted intercreditor agreement. The Notes and the 144A Warrants were purchased by the selling shareholders for a collective purchase price of 99% of the original principal amount of the Notes. In addition, in connection with the issuance of the Notes, the Company is required to pay an annual facility fee in advance on the date of such issuance and each anniversary thereof from the date of the issuance thereof through the Maturity Date in an amount equal to 1% of the original principal amount of the Notes on the date of such issuance; provided that upon the earliest to occur of (i) the first date upon which all of the then-outstanding Notes have been converted to ordinary shares, (ii) the first date upon which all of the then-outstanding Notes are subject to a fundamental change offer (as defined in the Indenture), (iii) the first date upon which the Company has exercised an optional redemption or tax redemption (as each such term is defined in the Indenture) as to all then-outstanding Notes are subject to a fundamental change offer (as defined in the Indenture), and (iv) the date upon which the Notes are accelerated or otherwise become due prior to the Maturity Date as a result of or during the continuance of an event of default under the Indenture, then, in each case, the remaining unpaid facility fees payable on each such anniversary remaining prior to the Maturity Date shall be accelerated and become due and payable. The 144A Warrants The 144A Warrants have a ten-year term and a $5.00 per share exercise price, and include customary anti-dilution adjustments as well as a ratchet anti-dilution adjustment in the event any ordinary shares or other equity or equity equivalent securities payable in ordinary shares are granted, issued or sold (or the Company enters into any agreement to grant, issue or sell), in each case, at a price less than the exercise price then in effect. Upon the occurrence of such an event, the exercise price of the 144A Warrants will be decreased to the lower price (subject to a floor of $2.80 per ordinary share) and the number of ordinary shares issuable upon exercise of the 144A Warrants will be increased, such that the aggregate exercise price of all 144A Warrants remains the same before and after any such event. This will result in additional ordinary shares that may be issuable upon exercise of the 144A Warrants and may result in dilution to the existing shareholders. Upon the occurrence of a Fundamental Transaction (as defined in the 144A Warrants), the 144A Warrants provide each holder a put right in respect of the 144A Warrants. Upon the exercise of a put right by a holder, the Company will be obligated to repurchase the 144A Warrants for the fair market value of the 144A Warrants repurchased, as calculated by a third-party valuation firm selected by the Company and reasonably acceptable to the holder. The 144A Warrants also include cashless exercise rights. The summaries of the Subscription Agreement, the Indenture, the Notes, the 144A Warrants and the Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of, as applicable, the Indenture (including the form of Note attached thereto), the form of Warrant, the Subscription Agreement and the Registration Rights Agreement, which are attached as Exhibits 4.5, 4.6, 10.14 and 10.15, respectively, to the registration statement of which this prospectus forms a part, which is incorporated herein by reference.
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001853506_jangit_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001853506_jangit_prospectus_summary.txt
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+PROSPECTUS SUMMARY Except as otherwise indicated, as used in this prospectus, references to the Company, we, us, or our refer to Jangit Enterprises, Inc. The following summary highlights selected information contained in this prospectus, and it may not contain all of the information that is important to you. Before making an investment decision, you should read the entire prospectus carefully, including Risk Factors and our financial statements and related notes, included elsewhere in, or incorporated by reference into, this prospectus. Corporate Background Where You Can Find Us The mailing address is currently 64175 620th Street, Atlantic, IA 50022. Our telephone number is (402) 630-6307. Summary of the Offering Securities being registered by the Selling Security Holders pursuant to the Secondary Offering: 3,000,000 shares of common stock Secondary Offering price: $0.10 per share until a market develops and our shares are quoted on the OTCQB or another quotation board and thereafter at market prices or prices negotiated in private transactions Secondary Offering period: From the date of this prospectus until _____, 202 2 Newly issued common stock being registered pursuant to the Primary Offering: 20,000,000 shares of common stock Primary Offering price: $0.10 per share Primary Offering period: From the date of this prospectus until _____, 202 2 Number of shares outstanding after the offering: 57,500,000 shares of common stock Market for the common stock: There has been no market for our securities. Our common stock is not traded on any exchange or on the Over-The-Counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with FINRA for our common stock to eligible for trading on the OTCQB or another quotation board. We do not yet have a market maker who has agreed to file such application. There is no assurance that a trading market will develop, or, if developed, that it will be sustained. Consequently, purchasers of our common stock may find it difficult to resell the securities offered herein should the purchasers desire to do so when eligible for public resale. Our officers and directors are not purchasing shares in this offering. Mr. Kirchhoff is the Company s sole officer and director and currently controls the Company and will continue to control the Company after the offering. Use of proceeds: We will receive approximately $2,000,000 in gross proceeds if we sell all of the shares in the Primary Offering, and we will receive estimated net proceeds (after paying offering expenses) of approximately $1,950,000 if we sell all of those shares. We will receive none of the proceeds from the sale of shares by the Selling Security Holders. See Use of Proceeds for a more detailed explanation of how the proceeds from the Primary Offering will be used.
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001853920_viscoglios_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001853920_viscoglios_prospectus_summary.txt
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: directors are to our directors, including any director nominees who will become directors in connection with the consummation of this offering; founder shares are to shares of our common stock held by our initial stockholders prior to this offering; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers and directors; private placement warrants are to the warrants issued to our sponsor and Raymond James in a private placement simultaneously with the closing of this offering; public shares are to shares of our common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and members of our management team to the extent our initial stockholders or members of our management team purchase public shares; provided that each initial stockholder s and management team member s status as a public stockholder shall only exist with respect to such public shares; Raymond James are to Raymond James & Associates, Inc. public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market), to the private placement warrants if held by third parties other than our sponsor or Raymond James (or their permitted transferees), and to any private placement warrants issued upon conversion of working capital loans that are sold to third parties that are not initial purchasers of our private placement warrants or members of our management team (or their permitted transferees); sponsor are to VBOC Holdings, LLC, a Delaware limited liability company; an affiliate of John J. Viscogliosi, our President, Chief Executive Officer and Chairman; trust account are to the trust account in the United States at Raymond James & Associates, Inc., with Continental Stock Transfer & Trust Company acting as trustee, into which we will deposit certain proceeds from this offering and from the sale of the private placement warrants; warrants are to our redeemable warrants, which includes the public warrants as well as the private placement; and we, us, Company or our company are to Viscogliosi Brothers Acquisition Corp. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Certain financial information contained in this prospectus has been rounded and, as a result, certain totals shown in this prospectus may not equal the arithmetic sum of the figures that would otherwise aggregate to those totals. Overview We are a blank check company whose business purpose is to effect a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization, or other similar business combination with one or more businesses or entities, which we refer to in this prospectus as our initial business combination. We TABLE OF CONTENTS Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non- accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act: Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. CALCULATION OF REGISTRATION FEE Title of Each Class of Security being registered Amount Being Registered Proposed Maximum Offering Price per Security(1) Proposed Maximum Aggregate Offering Price(1)(2) Amount of Registration Fee(5) Units, each consisting of one share of common stock, $0.0001 par value, and one-half of one redeemable warrant (2) 8,625,000 $ 10.00 $ 86,250,000 $ 7,995.38 Shares of common stock, $0.0001 par value, included as part of the units 8,625,000 (3) Redeemable warrants included as part of the units 4,312,500 (3) Total(4) $ 7,995.38 (1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended. (2) Includes (A) the aggregate of 7,500,000 units to be issued to public stockholders in the public offering and 1,125,000 units which may be issued upon exercise of a 45-day option granted to the underwriters to cover over-allotments, if any; and (B) shares of common stock and warrants underlying such units. (3) No fee pursuant to Rule 457(g). (4) Pursuant to Rule 416 under the Securities Act, there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from stock splits, stock dividends or similar transactions. (5) Previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. TABLE OF CONTENTS have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Although we are not limited to a particular industry or geographic region for purposes of consummating an initial business combination, we intend to focus our search on businesses that have their primary operations located in North America and Europe in the neuro-musculoskeletal industry. Our Sponsor and CEO Our sponsor is an affiliate of Viscogliosi Brothers, LLC ( VB ), a single-family office founded by Anthony, John, and Marc Viscogliosi, with extensive experience in the neuro-musculoskeletal ( NMS ) industry. VB has invested in more than 30 companies in the healthcare sector over the past two decades with a majority of its investment in the NMS industry. VB has a long history of growing venture-stage companies to global, commercialized businesses through organic expansion and strategic acquisitions. Today, these businesses have cumulative revenues exceeding $750 million. John J. Viscogliosi, our President, Chief Executive Officer and Chairman, has more than 20 years of operating and investing experience in the NMS industry. From 2004 to 2020 he was the Chairman and Chief Executive Officer of Centinel Spine, which he led to become the largest privately held spinal health company focused on anterior column reconstruction. In 2017, Mr. Viscogliosi led the acquisition for Centinel Spine of Prodisc from Johnson & Johnson. He subsequently repositioned the business and achieved annual double-digit revenue growth, and today the Prodisc portfolio represents over half of Centinel Spine s total sales. In addition, Mr. Viscogliosi successfully doubled Centinel Spine s surgeon and distributor bases and expanded the company s global reach to 21 geographic markets. He also helped expand the patient population receiving lumbar total disc replacements and improved the company s private insurer reimbursement coverage by adding nearly 30 million covered lives. In addition, Mr. Viscogliosi led the creation of the Patient Education Program, which leveraged key athletic ambassadors to increase patients spine knowledge and their awareness of resources available to relieve spine-related pain. He also organized a regulatory strategy to submit three FDA PMA (Premarket Approval) supplements for cervical Prodisc, expanding the company s product portfolio to establish the market-leading cervical and lumbar total disc replacement platform. Mr. Viscogliosi further oversaw the development and execution of the 2-level Prodisc SK and VIVO clinical trial, to further expand the clinical data relating to the Prodisc product portfolio. Mr. Viscogliosi is a founding member, and since 1999 has been a principal, of Viscogliosi Bros, LLC. In addition, since July 2020, he has been the Executive Chairman of VB EnviroCare. He previously co-founded multiple NMS businesses, including Paradigm Spine, LLC, Small Bone Innovations, Inc., Knee Creations, LLC, Musculoskeletal Clinical Regulatory Advisers, LLC and Spine Solutions, Inc. Mr. Viscogliosi served on the Board of Directors of Small Bone Innovations, Inc. and Woven Orthopedic Technologies, LLC. Additionally, Mr. Viscogliosi was formerly on the boards of Spine Solutions, Inc. and Knee Creations, LLC, and played an integral part in the sales of those companies to Johnson & Johnson Depuy-Synthes and Zimmer Holdings, respectively. Our Board of Directors John J. Viscogliosi will serve as our President, Chief Executive Officer and Chairman of our Board of Directors. In addition to Mr. Viscogliosi, we have 6 additional board members: F. Samuel Eberts III, Dan Drawbaugh, John N. Kastanis, Dr. Jean-Christophe Renondin, Marc R. Viscogliosi and Dr. Jack E. Zigler, five of whom will be independent directors. F. Samuel Eberts III is an international legal executive with over 30 years of diverse experience in healthcare, biotechnology, and specialty consumer products industries. He is the Chief Executive Officer of Darter Group LLC, a healthcare consultancy which he founded in 2013 and a Senior Lecturing Fellow at Duke University School of Law. From 2002 to 2019, Mr. Eberts was the Chief Legal Officer, Corporate Secretary and Senior Vice President of Corporate Affairs for Laboratory Corporation of America Holdings, a leading global life sciences company. Prior to his roles at LabCorp, Mr. Eberts was Vice President, Secretary, and General Counsel of Stepan Company. Before joining Stepan Company, he was Assistant General Counsel for Cardinal Health, Inc., and Associate General Counsel for Allegiance Healthcare Corporation. Prior to that time, he was Chief Counsel at Baxter International s North American Biotech TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUSSUBJECT TO COMPLETION, DATED JANUARY 4, 2022 $75,000,000 VISCOGLIOSI BROTHERS ACQUISITION CORP. 7,500,000 Units Viscogliosi Brothers Acquisition Corp., which we refer to as we, us, Company or our company, is a newly organized blank check company incorporated in Delaware whose business purpose is to effect a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities, which we refer to in this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Although we are not limited to a particular industry or geographic region for purposes of consummating an initial business combination, we intend to focus on businesses that have their primary operations located in North America and Europe in the neuro-musculoskeletal industry. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of common stock, par value $0.0001, and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our common stock at a price of $11.50 per whole share, subject to adjustment as described herein. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or our liquidation, as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to an additional 1,125,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our common stock, or public shares, upon the completion of our initial business combination, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations and on the conditions described herein. If we are unable to complete our initial business combination within 18 months from the closing of this offering, we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. In such event, the warrants will expire and be worthless. VBOC Holdings, LLC, our sponsor, has agreed to purchase an aggregate of 5,062,500 warrants (or 5,484,375 warrants if the over-allotment option is exercised in full) at $1.00 per private placement warrant for a total purchase price of $5,062,500 (or $5,484,375 if the over-allotment option is exercised in full), each exercisable to purchase one share of common stock at an exercise price of $11.50 per whole share. Raymond James & Associates, Inc. has agreed to purchase an aggregate of 187,500 private placement warrant warrants (or 215,625 warrants if the over-allotment option is exercised in full) at $1.00 per for a total purchase price of $187,500 (or $215,625 if the over-allotment option is exercised in full), each exercisable to purchase one share of common stock at an exercise price of $11.50 per whole share. These purchases, totaling $5,250,000 (or $5,700,000 if the over-allotment option is exercised in full), will take place on a private placement basis simultaneously with the closing of this offering. Our initial stockholders own 2,156,250 shares of our common stock, acquired for an aggregate purchase price of $25,000. Such shares are referred to herein as founder shares, and include an aggregate of up to 281,250 shares that are subject to forfeiture to the extent that the underwriters over-allotment option is not exercised. Currently, there is no public market for our units, common stock or warrants. We intend to apply to have our units listed on the Nasdaq Global Market, or Nasdaq, under the symbol VBOC.U on or promptly after the date of this prospectus. Once the securities comprising the units begin separate trading, as described herein, we expect the shares of common stock and warrants will be traded on Nasdaq under the symbols VBOC, and VBOC.WS, respectively. We cannot assure you that our securities will be approved for listing on Nasdaq and, if approved, will continue to be listed on Nasdaq after this offering. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 34 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per unit Total Public offering price 10.00 75,000,000 Underwriting discounts and commissions (1) $ 0.55 $ 4,125,000 Proceeds, before expenses, to Viscogliosi Brothers Acquisition Corp. 9.45 70,875,000 (1) $0.20 per unit, or $1,500,000 in the aggregate (or $1,725,000 if the underwriters over-allotment option is exercised in full), is payable upon the closing of this offering. $0.35 per unit, or $2,625,000 in the aggregate (or $3,018,750 if the underwriters over-allotment option is exercised in full), of deferred underwriting commissions will be placed in a trust account located in the United States, as described herein, and released to the underwriters only on completion of an initial business combination, as described herein. See the section of this prospectus entitled Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described herein, $76,500,000, or $87,975,000 if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case), will be deposited into a trust account in the United States at Raymond James & Associates, Inc., with Continental Stock Transfer & Trust Company acting as trustee, and $5.25 million, or $5.7 million if the underwriters over-allotment option is exercised in full, will be available to pay fees and expenses in connection with the closing of this offering, including the underwriting discounts and commissions payable upon the closing of this offering, and for working capital following the closing of this offering. The underwriters are offering the units on a firm commitment basis. Raymond James, as the representative of the underwriters, expects to deliver the units to purchasers on or about , 2021. Sole Book-Running Manager Raymond James , 2021 TABLE OF CONTENTS division, and Corporate Counsel in the Office of the General Counsel at Baxter International Inc. Mr. Eberts is the past Chairman and a current Board member of Easter Seals UCP of North Carolina and Virginia and a member of the Board of Trustees for Endicott College and the Wilson Council of the Woodrow Wilson International Center for Scholars. Mr. Eberts has previously served as Director and Member of the Investment Committee of MedCap Growth Equity Funds and as Board Member of the Alamance Community College Foundation. Mr. Eberts received his Bachelor of Science in Political Science at Loyola University of Chicago and later obtained his J.D. from Boston University School of Law. Dan Drawbaugh is the Chief Executive Officer of The Steadman Clinic (TSC) and Steadman Philippon Research Institute (SPRI) in Vail, Colorado. As CEO since 2015, Mr. Drawbaugh leads a team of talented physicians, researchers, scientists, and administrators who make TSC and SPRI one of the most sought-after orthopaedic sports medicine destination centers in the world. Mr. Drawbaugh strategically expanded the organization s partnerships with Varsity Healthcare Partners, Vail Health, Aspen Valley Hospital, and a variety of technology companies, to continue advancing the organization s global prominence in sports and orthopaedic medicine through investments in research capabilities and new scientific laboratories. Mr. Drawbaugh is a proven leader and innovator in healthcare information technology with over 30 years of experience in the areas of information and biomedical technologies. Mr. Drawbaugh joined TSC and SPRI in 2015 from the University of Pittsburgh Medical Center, where he held the position of Chief Information Officer and other positions for 31 years. Mr. Drawbaugh currently serves as a board member at MJP Innovations and has previously served on the Boards of Directors/Advisors of Oracle, IBM, Verizon Wireless, GENCO (now FedEx), Vestar Capital Partners, dbMotion and Omnyx. Mr. Drawbaugh earned his bachelor s degree in biomedical and electrical engineering technology from Temple University and his MBA from Duquesne University. John N. Kastanis, MBA, FACHE, is an accomplished health systems executive with significant experience leading and teaching in high acute, tertiary-care, quaternary-care and specialty hospitals. His core expertise is in strategic planning, governance, fund development and academic medicine, while also managing large Medicaid and Medicare patient populations. Mr. Kastanis has a proven record of success with financial turnarounds, mergers, corporate restructurings, integrated delivery network development, labor-management negotiations, and performance improvement. As President and CEO of University Hospital, Newark, NJ from 2016 to 2018, Mr. Kastanis led the state s primary teaching hospital and clinical research site for Rutgers New Jersey Medical School, the state s only Northern New Jersey Level 1 Trauma Center, and the EMS 911 service for the City of Newark. Kastanis has also served from 2011 to 2016 as President and CEO at Temple University Hospital and led the Hospital for Joint Diseases Orthopedic Hospital, among several others. Since 2018 he has been the Principal & Consultant of JNK Consulting, an independent healthcare consulting practice where he has served as an Advisory Board Member for multiple companies. He has served on numerous boards and commissions including more recently with the Board of Managers of the Vizient University Health System Consortium, the New Jersey Hospital Association, the Greater Newark Healthcare Coalition, the Greater New York Hospital Association and America s Essential Hospitals. Mr. Kastanis holds an MBA in healthcare management from Baruch College-Mount Sinai School of Medicine, a B.A. in Political Science from Queens College and is Board Certified as a Life Fellow in the American College of Healthcare Executives (LFACHE). He has also provided recent lectures to medical societies, medical ground rounds, and universities (Harvard and Arcadia) on health care reform and financial & operational turnarounds. Dr. Jean-Christophe Renondin, MD, MBA is an accomplished and seasoned healthcare investor with more than 20 years of experience in financing and investing in healthcare asset globally. Dr. Renondin has been, since 2015, the Senior Healthcare Manager at the Sovereign Fund of Oman, the Oman Investment Authority (OIA), in charge of the Healthcare Investment Practice. His primary responsibilities are to implement the investment strategy and to originate and execute investment opportunities in North America, Europe and Asia. Recent investments were in Symetis and Cognate Bioservices. Prior to joining the OIA, Dr. Renondin was Managing Director at Bryan Garnier & Co., a pan-European investment bank, in charge of the healthcare practice leading ECM and Private Placement transactions for European healthcare clients. Prior to this role, Dr. Renondin was General Partner at CDC Innovation, investing in various European healthcare assets. From 1999 to 2005 Dr. Renondin was Vice President at Sofinov, a subsidiary of the Caisse de Depot et Placement of Quebec (CDPQ), leading the Healthcare investment fund, and Managing Director at MDS Capital, one of the leading healthcare investment firms in Canada. Prior to TABLE OF CONTENTS 1999, Dr. Renondin was the General Manager of various international subsidiaries for Servier Laboratories, in Ireland and in South Africa, where he successfully restructured several departments. Prior to working at Servier, Dr. Renondin was at JP Morgan in the Healthcare equity research and Corporate Finance department at the NY office. Dr. Renondin currently serves as a board member at Juvenescence, a longevity biotech company and he has previously served on the Board of Directors of Cognate Bioservices and was board and an Investment Committee member of the VC Fund Innovation Development Oman. Dr. Renondin earned his Medical Doctorate degree from Paris V Descartes University and his MBA from the Amos Tuck School of Administration and Finance at Dartmouth University in 1991. Marc R. Viscogliosi is one of the founders of our sponsor, Viscogliosi Brothers, LLC and is an experienced CEO, Venture & Private Equity Investor and Company/Industry Creator with a proven track record of success over the last two decades in the medical device industry. Having completed over $800 million in equity and debt capital raises at all levels of a company s lifecycle, Mr. Viscogliosi is particularly sensitive to matching the capital needs of a business to its value inflection points, while generating over $2.1 billion in exit values for investor-partners and stakeholders. Over the last 20 years at VB, Mr. Viscogliosi has been principally responsible for driving innovation identification, regulatory and clinical strategies of the portfolio companies and capitalization structuring optimization of the portfolio companies. As Founder and CEO of Paradigm Spine, Mr. Viscogliosi was responsible for raising approximately $80 million in institutional equity investment and approximately $125 million of net debt in execution of its value creation strategy. As Executive Chairman of Knee Creations, Mr. Viscogliosi was responsible for guiding the business from product concept to early commercialization and ultimately its acquisition by Zimmer Biomet for nearly 10x revenues. As Founder and CEO of MCRA, LLC, Mr. Viscogliosi has been responsible for building MCRA into a leading medical device regulatory CRO, with nearly 100 professionals working with more than 150 clients monthly to achieve its strategic regulatory and clinical objectives. Mr. Viscogliosi graduated with a Bachelor of Arts degree from New York University with a double-major in Economics and Political Science. Dr. Jack E. Zigler, MD, FACS, FAAOS, is an orthopedic spine surgeon and from 2008 to 2018 was Medical Director at the Texas Back Institute (TBI). He was Co-Director of the Spine Surgery Fellowship Program at TBI and served as Principal Investigator or Sub-Investigator on approximately twelve FDA studies. Dr. Zigler previously served from 1991 to 1996 as a Clinical Professor of Orthopedic Surgery at the USC School of Medicine and from 1994 to 1996 at the UCI School of Medicine. At that time, Dr. Zigler was also the Chief of the Spinal Injury Service and the Director of Fellowship & Residency Training at the Rancho Los Amigos Medical Center. Since 2018 he has been a member of the Medical Advisory Board of Veritas Health, International Society for the Advancement of Spine Surgery ( ISASS ), a member of the Board of Trustees of AO Spine, and an Associate Editor at the SAS Journal. Dr. Zigler is a Past President of the American Spinal Injury Association and Immediate Past President of the International Society for the Advancement of Spine Surgery. He has additionally served as chairman of multiple boards, including the AO Lumbar Degenerative Expert Group, the Exhibits and Membership Committees of the Cervical Spine Research Society, the CSRS Committee on Patient Education, the Program Committee of the American Spinal Injury Association, and the Task Force on Aging of the North American Spine Society. In addition, Dr. Zigler was a board member of Capital Bank, a publicly traded bank based in San Juan Capistrano, where he served as chairman of the compensation committee. Dr. Zigler has published over 80 studies in the peer-reviewed scientific literature and has authored three textbooks on spine surgery. He received multiple postgraduate training certificates as an Arnold Fellow in Spine Surgery at the Department of Orthopedic Surgery, Case Western Reserve University School of Medicine, a Resident and Chief Resident in Orthopedic Surgery at Mount Sinai School of Medicine and Resident in Surgery at the Long Island Jewish Hillside Medical Center. Dr. Zigler received his Bachelor of Science (Distinction) from Cornell University and later obtained his M.D. (cum laude) from the SUNY Upstate Medical Center in Syracuse, NY. Acquisition Strategy Our acquisition strategy will leverage our management team s experience in operations, product development, technology management, regulatory strategy, clinical trial development, product positioning, marketing and capital raising to identify unique opportunities in the NMS sector. Moreover, our Board of Directors will leverage their experience and broad industry relationships to further support our acquisition TABLE OF CONTENTS and evaluation process. Given our dedicated approach to the NMS industry and our significant network of relationships, we believe we are well positioned to identify leading potential acquisition targets. Our goal is to acquire a platform company in the NMS industry that has a: Well-established, differentiated product portfolio with significant growth potential; Product pipeline with a consistent cadence of new product rollouts; Strong management team with a shared vision to create a dominant player within the NMS industry and the ability to rapidly grow the business; Wide distributor network with potential for expansion; Diverse and loyal user base; Strong margins with visible revenue growth potential; and would benefit from being publicly traded and having access to incremental growth capital. We believe that, upon completing our initial business combination, our management team will use their expertise in growing the business organically to help expand the company s operations and its sales and distribution channels following the business combination. There will also be a strong emphasis on looking to grow the company through further acquisitions, and developing the company as a consolidator within its industry. We believe that there may also be opportunities to make other, peripheral acquisitions at the same time as we complete our initial business combination. We believe an acquisition by our Company can provide an efficient liquidity and capital-raising mechanism while materially reducing the risks and expenses associated with a traditional initial public offering. Furthermore, we believe VB s management team is well known to, and respected by, the founders, management, and stockholders of private medical technology companies, and that our leadership s reputations will be a competitive advantage in attracting high quality targets for our business combination. The VB management team and Board of Directors have extensive operating and transaction experience in the medical technology sector as managers, investors, acquirors and sellers. We intend to leverage this experience and our networks to identify a target company and to deliver operational and economic benefit from a business combination. Competitive Differentiation Our focus is to create attractive risk adjusted returns for our stockholders, focusing on limiting technology risk by pursuing clinically proven, innovative technologies executing a differentiated operational, clinical, and regulatory strategy. We believe that our team members have proven their ability to commercialize transformational technologies into market disrupting business leaders. We intend to capitalize on our ability to use the following differentiation factors to our advantage: VB s extensive ecosystem network of relationships provides us with early access to top quality deals. VB s ecosystem network includes sponsors, our investor network, key opinion leaders, global surgeon societies, innovation programs access, strategic and corporate relationships, medical institutions and the universe of NMS co-investors. Given these connections, we believe that we provide a competitive sourcing advantage and will be a preferred partner for potential targets. The niche focus on NMS provides us with an advantage over generalist healthcare investors. The deep domain expertise of our management team, detailed knowledge of market dynamics, understanding of the specific needs of the medical community and experience with the intricacies of market adoption for NMS products and technology provide us with an exceptional ability to select the leading companies in the industry. We believe that generalist healthcare investors lack the ability to understand the risks associated with this niche NMS market and to identify leading target companies. Over VB s history, VB has used its investment criteria to identify best-in-class companies, products, and technologies. VB has helped companies build strong technology platforms, fulfill clinically unmet needs, achieve successful clinical track records, mitigate regulatory risk, own significant intellectual property and regulatory portfolios, and provide market development opportunities. VB is led by an all-in entrepreneur and TABLE OF CONTENTS has an effective business model. We believe VB s experience investing in and exiting portfolio companies will help provide the Company with the ability to generate positive and favorable returns. Members of our management team have also participated as financiers in several complex NMS transactions, including licensing agreements, corporate carveouts, IP acquisitions, product divestitures, asset purchase agreements, initial public offerings, company formations, debt recapitalizations, equity recapitalizations, secondary offerings, mergers, acquisitions, joint venture partnerships, debt restructurings, debt placements and private equity placements. We believe these experiences provide a distinct advantage through all stages of the investment process, from deal sourcing to portfolio company exit. We seek to leverage our team s experience arranging hundreds of partnerships with suppliers and distributors, initiating manufacturing, building and growing several sales forces, accelerating revenue growth, growing total surgeon users, building hospital distribution networks and creating market leaders within niche markets. We have a great deal of experience working with direct reps, agencies and independent distributors. Additionally, we have often worked alongside and with large and small medical device companies. Industry Opportunity The NMS industry comprises disorders and diseases that affect human body movement involving nerves, muscle, soft tissue, and bones that lead to pain and loss of mobility. According to Orthoworld, the neuro-musculoskeletal market, also known as orthopedics, was valued at $53 billion in 2019, and saw sales growth of approximately 3.8% from 2018 to 2019. Orthopedics is the branch of medicine that deals with NMS diseases. Throughout this section, the terms orthopaedics and NMS will be used interchangeably. We believe that 100% of the population living an average life expectancy will suffer from an NMS trauma or disease. We believe that NMS diseases and disorders are the number-one cause of long-term pain, physical disability, doctor visits, worker compensation claims and employee absenteeism. We believe that there are five key sectors within the NMS industry that are of interest to our Company: 1. Implantable Devices: The implantable devices segment consists of technologies that replace, repair, or support a damaged bone. These devices can be segmented into further categories based on the area of the body or type of treatment they target and offer: a. Spine: The spine market consists of implants, instruments, and surgical assistance systems to treat degenerative disc disease, herniated discs, scoliosis, vertebral fractures with pedicle screws, artificial discs, motion-preserving and kyphoplasty devices. According to Orthoworld, in 2019, global sales in the spine market amounted to $9.6 billion with almost 63% of global sales accounted for by the top four companies in the segment. Also according to Orthoworld, the spine market is growing at a rate of 3.5% per year and is projected to reach $10.0 billion in sales in 2022. b. Sports Medicine: The sports medicine market consists of equipment and implantables, including arthroscopes, visualization systems and other similar technologies for the removal of bone and soft tissue. According to Orthoworld, between 2017 and 2019, the sports medicine market grew approximately 5.5% per year and in 2019 accounted for roughly $5.9 billion in global sales. c. Trauma: The trauma market consists of implants and instruments for internal and external use, such as plates, screws, nails, pin, and external fixators, to treat traumatic injuries affecting the neuromusculoskeletal anatomy. The trauma market is the third largest segment in the orthopedic industry, and according to Orthoworld generated roughly $7.4 billion in global sales in 2019. d. Total Joint Replacement: The total joint replacement market consists of implants, instruments and surgical assistance systems used to replace or repair failed joints in the knee, hip, shoulder, elbow, wrist, ankle, and digits. According to Orthoworld, the total joint replacement market accounted for $19.5 billion, or over 37%, of global orthopedic sales in 2019. TABLE OF CONTENTS e. Neuromodulation: The neuromodulation market consists of technologies that use electrical or pharmaceutical agents to alter or modulate nerve activity in a target area. Neuromodulation technology was first introduced in the early 1960s, with the use of deep brain stimulation to resolve chronic and intractable pain and was later extended to indications relating to the spine. According to Neurotech Reports, the market for implanted spinal stimulators was valued at $12 billion in 2020 and was expected to continue to grow at double-digit annual growth rates. 2. Service Companies: Service companies offer comprehensive solutions to other medical device companies facing with clinical, regulatory, reimbursement and product issues. Services vary from one company to another, with some service companies offering a wide range of services and others offering more niche and focused specialties, for example in relation to the product development process of medical devices. Service companies cater to a wide range of medical device companies in the healthcare space. 3. Regenerative Medicine: a. Biologics: The biologics and biochemical product market for NMS indications accounted for roughly $5.3 billion in 2019, according to Orthoworld. Products in this space include technologies such as allograft and xenograft tissue, synthetic bone graft substitutes, autologous platelet/plasma systems and other similar therapies. We believe that greater demand for regenerative/biologic-type therapies among patients and athletes will drive growth in this market. b. Therapeutics: The therapeutics market consists of products that are used to treat orthopedic diseases through a biochemical action, and mainly include opioid and non-opioid therapeutic agents. This market also includes the fast-growing digital therapeutics segment. The demand for global digital therapeutics is on the rise, owing to increases in the adoption of smartphones and tablets coupled with healthcare apps, the need to control healthcare costs and rises in incidences of chronic diseases. 4. Contract Manufacturers: The contract manufacturer segment consists of orthopedic and medical device original equipment manufacturers (OEMs) that are responsible for the production, manufacturing, and assembly of medical devices in all areas of healthcare. These companies are key players in the healthcare and orthopedic supply chain and often work as outsourcing hubs for many of the top medical device developers around the globe. Overall, the healthcare industry and healthcare spending continues to grow as a percentage of GDP topping 9.8% in 2018, according to the World Bank. The largest contributors, or foundational drivers, of growth trends in the healthcare industry are the rapidly aging population, expanding global life expectancy, increasing rates of obesity and diabetes and the rising cost and volume of medical care. All the foundational drivers directly affect the NMS industry. NMS disorders and disease are not only conditions of older age but also effect the entire lifecycle of the patient population. The patient and provider demand for new, innovative, and cost-effective solutions to manage these chronic debilitating diseases remains urgent. Growing Elderly Population: There are more than 668 million people, or 11.6% of the total global population, over the age of 60, and it is estimated that by 2050 this number will increase to 1.5 billion, according to the World Health Organization. We believe that people over the age of 60 are at high risk of joint replacements, degenerative disc disease, arthritis, and osteoporosis, with approximately 17%, 14%, and 3% of the elderly in the U.S. having been diagnosed with arthritis, osteopenia, and osteoporosis, respectively (Burden of Musculoskeletal Diseases). Expanding Life Expectancy: Life expectancy is expected to increase from 73.5 years in 2018 to 74.4 in 2022 and will continue to increase for females in low-mortality countries such as Japan and Sweden (Global Healthcare Report, Deloitte). Medical care spending more than doubles between the ages of 70-90 (Journalist Resource), and with the increase in life expectancy, we believe there should be a sharp increase in healthcare spending as well. TABLE OF CONTENTS Increasing Obesity and Diabetes Rates: Worldwide obesity has nearly tripled since 1975, and today 13% of adults globally are classified as obese, putting them at major risk for NMS disorders as they continue to age (World Health Organization). Rising Cost and Volume of Medical Care: Global healthcare spending was approximately US$8.7 trillion in 2020, with a strong focus on improving healthcare in developing countries (Global Healthcare Report, Deloitte). NMS conditions are the leading cause of disability in the United States and are estimated to cost approximately $980 billion (5.8% of GDP) annually (United States Bone and Joint Initiative). Initial Business Combination Nasdaq listing rules require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the value of the trust account (excluding any deferred underwriting fees and taxes payable on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. We refer to this as the 80% of net assets test. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of the 80% of net assets test. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test. If our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management team will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. TABLE OF CONTENTS We will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Other Considerations We currently do not have any specific business combination under consideration. Our officers and directors have neither individually identified nor considered a specific target business nor have they had any substantive discussions with possible target businesses. We have not (nor have any of our agents or affiliates) substantively engaged with any candidates (or a representative of any candidate) with respect to a possible acquisition transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive action, directly or indirectly, with any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Members of our management team, including our directors and officers, will directly or indirectly own our securities following this offering and, accordingly, may have a conflict of interest in determining whether a particular target company is an appropriate business with which to effectuate our initial business combination. Each of our directors and officers may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any directors or officers was included by a target business as a condition to any agreement with respect to such business combination. We are not prohibited from pursuing an initial business combination or subsequent transaction with a company that is affiliated with our sponsor, officers, or directors. In the event we seek to complete our initial business combination or, subject to certain exceptions, subsequent material transactions with a company that is affiliated with our sponsor or any of our officers or directors, we, or a committee of independent directors, to the extent required by applicable law or our board of directors, will obtain an opinion from an independent investment banking firm or another independent accounting firm that such initial business combination or transaction is fair to our company from a financial point of view. Each of our directors and officers presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. if any of our directors or officers becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has pre-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. Each of our sponsor, directors and officers may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates. Our directors and officers are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Corporate Information We were incorporated under the laws of the State of Delaware on November 24, 2020. Our executive offices are located at 505 Park Avenue, 14th Floor, New York, NY 10022 and our telephone number is (212) 583-9700. Our website is www.VB-OC.com. Information contained on, or that can be accessed through, our website is not part of this prospectus. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of TABLE OF CONTENTS Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion (as adjusted for inflation pursuant to SEC rules from time to time), or (c) in which we are deemed to be a large accelerated filer, which means the aggregate worldwide market value of our common stock that is held by non-affiliates equals or exceeds $700,000,000 as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250,000,000 as of the prior June 30th or (2) our annual revenues equaled or exceeded $100,000,000 during such completed fiscal year and the market value of our common stock held by non-affiliates equals or exceeds $700,000,000 as of the prior June 30th. TABLE OF CONTENTS The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 27 of this prospectus. Securities offered 7,500,000 units or 8,625,000 units if the over-allotment option is exercised in full, at $10.00 per unit, each unit consisting of: one share of common stock; and one-half of one redeemable warrant. Listing of our securities and proposed symbols We anticipate the units, and the shares of common stock and the warrants, once they begin separate trading, will be listed on Nasdaq under the symbols VBOC.U, VBOC, and VBOC.WS, respectively. Trading commencement and separation of common stock and warrants The units are expected to begin trading on or promptly after the date of this prospectus. We expect the shares of common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Raymond James, as the representative of the underwriters, informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. In no event will the common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. TABLE OF CONTENTS Units: Number issued and outstanding before this offering 0 units Number to be issued and outstanding after this offering 7,500,000 units1 Shares of common stock: Number issued and outstanding before this offering 2,156,250 shares2 Number to be issued and outstanding after this offering 9,375,000 shares3 Redeemable warrants: Number issued and outstanding before this offering 0 warrants Number to be issued and outstanding after this offering and sale of private placement warrants 9,000,000 (includes 3,750,000 public warrants and 5,250,000 private placement warrants)4 Exercisability Each whole warrant is exercisable to purchase one share of common stock. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-half of one redeemable warrant, with each whole warrant exercisable for one share of common stock, as compared to units issued by some other similar blank check companies that contain one whole warrant exercisable for one share, in order to reduce the dilutive effect of the warrants upon completion of our initial business combination as compared to units that each contain one warrant exercisable for one share, thus making us, we believe, a more attractive business combination partner for target businesses. Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or its 1 Assumes the over-allotment option has not been exercised. 2 This number includes up to an aggregate of 281,250 shares of common stock held by our sponsor that are subject to forfeiture if the over- allotment option is not fully exercised by the underwriters. 3 Assumes the over-allotment option has not been exercised and an aggregate of 281,250 shares of common stock held by our sponsor have been forfeited. If the over-allotment option is exercised in full, there will be a total of 10,781,250 shares of common stock issued and outstanding. 4 Assumes the over-allotment option has not been exercised. If the over-allotment option is exercised in full, there will be a total of 10,012,500 warrants issued and outstanding. TABLE OF CONTENTS affiliates, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination and 12 months after the closing of this offering; provided, in each case, that we have an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement) and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. We are not registering the shares of common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration statement covering the shares of common stock issuable upon exercise of the warrants, to cause such registration statement to become effective and to maintain a current prospectus relating to those shares of common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. TABLE OF CONTENTS Notwithstanding the above, if our common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the reported closing price of our common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations, and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. TABLE OF CONTENTS If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing the product of the number of shares of common stock underlying the warrants multiplied by the excess of the fair market value (defined below) over the exercise price of the warrant by (y) the fair market value. The fair market value shall mean the average reported closing price of the common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section of this prospectus entitled Description of Securities Redeemable Warrants Public Warrants for additional information. Offering proceeds to be held in trust $76,500,000 of the net proceeds of this offering and the private placement (or $87,975,000 if the over-allotment option is exercised in full), will be placed in a trust account at Raymond James & Associates, Inc., maintained by Continental Stock Transfer & Trust Company, acting as trustee pursuant to an agreement to be signed on the date of this prospectus. These proceeds include $2,625,000 (or $3,018,750 if the underwriters over-allotment option is exercised in full), of deferred underwriting commissions. Except as set forth below, the proceeds in the trust account will not be released until the earlier of: (1) the completion of an initial business combination within the required time period and (2) our redemption of 100% of the outstanding public shares if we have not completed a business combination in the required time period. Therefore, unless and until our initial business combination is consummated, the proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the negotiation of an agreement to acquire a target business. Notwithstanding the foregoing, there can be released to us, from time to time, any interest earned on the funds in the trust account that we may need to pay our tax obligations. With this exception, expenses incurred by us may be paid prior to a business combination only from the net proceeds of this offering not held in the trust account of approximately $1,750,000; provided, however, that in order TABLE OF CONTENTS to meet our working capital needs following the consummation of this offering if the funds not held in the trust account are insufficient, our initial stockholders, officers and directors or their affiliates may, but are not obligated to, loan us funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each loan would be evidenced by a promissory note. The notes would be paid upon consummation of our initial business combination, without interest. Founder shares In February 2021, our sponsor purchased 2,156,250 shares for an aggregate purchase price of $25,000, which shares are referred to herein as founder shares, and include an aggregate of up to 281,250 shares that are subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering. Subsequently, in March and April 2021, an aggregate of 150,000 founder shares were transferred to directors of the Company. These 150,000 shares will not be subject to forfeiture in the event the underwriters over-allotment option is not exercised. None of our initial stockholders has indicated any intention to purchase public units in this offering. The founder shares are identical to the shares of common stock included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; the founder shares are entitled to registration rights; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation to (A) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or (B) with respect to any other material provisions relating to stockholders rights or pre- initial business combination activity, (iii) waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 18 months from the closing of this offering, although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to TABLE OF CONTENTS complete our initial business combination within the prescribed time frame and (iv) vote any founder shares held by them and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. If we submit our initial business combination to our public stockholders for a vote, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. As a result of the agreement of our sponsor, officers and directors to vote their shares in favor of our initial business combination, we would need 468,750, or 6.25%, of the 7,500,000 public shares sold in this offering, to be voted in favor of our initial business combination in order to have our initial business combination approved (assuming that only a quorum was present at the meeting, that the over-allotment option is not exercised and that the initial stockholders do not purchase any units in this offering or units or shares in the after-market). Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the reported closing price of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Warrants ). Any permitted transferees will be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. Appointment of directors; voting rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. With respect to any other matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. TABLE OF CONTENTS Private placement warrants VBOC Holdings, LLC, our sponsor, has committed to purchase from us an aggregate of 5,062,500 warrants or private placement warrants, (or 5,484,375 warrants if the over-allotment option is exercised in full) at $1.00 per private placement warrant for a total purchase price of $5,062,500 (or $5,484,375 if the over-allotment option is exercised in full), each exercisable to purchase one share of common stock at an exercise price of $11.50 per whole share. Raymond James has agreed to purchase an aggregate of 187,500 warrants (or 215,625 warrants if the over-allotment option is exercised in full) at $1.00 per private placement warrant for a total purchase price of $187,500 (or $215,625 if the over-allotment option is exercised in full). These purchases will take place on a private placement basis simultaneously with the consummation of this offering. To the extent that the underwriters exercise their overallotment option, our sponsor and Raymond James will purchase that additional number of private placement warrants as is necessary to maintain in the trust fund an amount equal to $10.20 per share sold to the public in this offering. A portion of the proceeds from the private placement of the private placement warrants will be added to the proceeds of this offering and placed in a trust account in the United States maintained by Continental Stock Transfer & Trust Company, as trustee. If we do not complete our initial business combination within 18 months, such portion of the proceeds from the sale of the private placement warrants will be included in the liquidating distribution to the holders of our public shares. The private placement warrants are identical to the warrants sold as part of the public units in this offering. The private placement warrants (including the shares of common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable, or salable until 30 days after the completion of our initial business combination, except as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants. Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, non-cash payments, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers, prior to, or in connection with any services rendered to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments may be made to our sponsor, officers, or directors, or our or their affiliates, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination: Payment of $10,000 per month to an affiliate of VBOC Holdings, LLC for office space and related services, subject to deferral as described herein; TABLE OF CONTENTS Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants, including as to exercise price, exercisability, and exercise period. The terms of such working capital loans by our sponsor or its affiliates, or our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, or directors, or our or their affiliates. Conditions to completing our initial business combination Permitted purchases of public shares and public warrants by our affiliates In accordance with the rules of Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the amount of deferred underwriting discounts held in trust and net of taxes payable) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. However, we may structure our initial business combination so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target TABLE OF CONTENTS business to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be considered for purposes of Nasdaq s 80% of fair market value test. If the initial business combination involves more than one target business, the 80% of fair market value test will be based on the aggregate value of all the transactions and we will treat the target businesses together as our initial business combination for purposes of seeking stockholder approval or conducting a tender offer, as applicable. If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors, or their affiliates may purchase public shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares or warrants our initial stockholders, directors, officers, advisors, or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non- public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will TABLE OF CONTENTS require insiders to: (i) refrain from purchasing our securities during certain blackout periods when they are in possession of any material non-public information and (ii) clear all trades of company securities with a compliance officer prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior to completion of our initial business combination. See Proposed Business Permitted Purchases of Our Securities for a description of how our sponsor, initial stockholders, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. Our sponsor, directors, officers, Redemption rights for public stockholders upon completion of our initial business combination The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our shares of common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the TABLE OF CONTENTS completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.20 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination or otherwise. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) without a stockholder vote by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq s stockholder approval rules. The requirement that we provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above will be contained in provisions of our amended and restated certificate of incorporation and will apply whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of a majority of our common stock entitled to vote thereon. TABLE OF CONTENTS If we provide our public stockholders with the opportunity to redeem their public shares in connection with a stockholder meeting, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares, we would need 468,750, or 6.25%, of the 7,500,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming that only a quorum was present at the meeting, that the over-allotment option is not exercised and that the initial stockholders do not purchase any units in this offering or units or shares in the after-market). We intend to give not less than 10 days nor more than 60 days prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction or whether they were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction. TABLE OF CONTENTS If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination, which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of deferred underwriters fees and commissions (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. We intend to require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to, at the holder s option, either deliver their stock certificates to our transfer agent or deliver their shares to our transfer agent electronically using the Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the vote on the proposal to approve the initial business combination. In addition, if we conduct redemptions in connection with a stockholder vote, we intend to require a public stockholder seeking redemption of its public shares to also submit a TABLE OF CONTENTS written request for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates or shares delivered by public stockholders who elected to redeem their shares. Our amended and restated certificate of incorporation will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of deferred underwriters fees and commissions (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed initial business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed initial business combination. In the event the aggregate cash consideration we would be required to pay for all shares of common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, and all shares of common stock submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of stockholders holding more than 15% of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares TABLE OF CONTENTS sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then- current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against an initial business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Redemption rights in connection with proposed amendments to our certificate of incorporation Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement of warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of a majority of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of a majority of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law ( DGCL ) or applicable stock exchange rules. Our amended and restated certificate of incorporation will provide that we may not issue additional shares of capital stock that would entitle the holders thereof to receive funds from the trust account or vote on any initial business combination or on matters related to our pre- initial business combination activity. Our initial stockholders, who will collectively beneficially own 20% of our outstanding shares of common stock upon the closing of this offering (assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and TABLE OF CONTENTS restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, executive officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation to (A) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or (B) with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion of our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. TABLE OF CONTENTS Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Liquidation if no business combination If we are unable to complete our initial business combination within 18 months from the closing of this offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares (including any public units sold in this offering or any public units or shares that our initial stockholders or their affiliates purchased in this offering or later acquired in the open market or in private transactions), at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares (including any public units sold in this offering or any public units or shares that our initial stockholders or their affiliates purchased in this offering or later acquired in the open market or in private transactions), which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining holders of common stock and our board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject (in the case of (ii) and (iii) above) to our obligations to provide for claims of creditors and the requirements of applicable law. TABLE OF CONTENTS Holders of warrants will receive no proceeds in connection with the liquidation with respect to such warrants, which will expire worthless. We may not have funds sufficient to pay or provide for all creditors claims. Although we will seek to have all third parties (including any vendors or other entities we engage after this offering) and any prospective target businesses enter into valid and enforceable agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account, there is no guarantee that they will execute such agreements. There is also no guarantee that the third parties would not challenge the enforceability of these waivers and bring claims against the trust account for monies owed them. The holders of the founder shares will not participate in any redemption distribution with respect to their founder shares, but may have any public shares redeemed upon liquidation. If we are unable to complete our initial business combination and we expend all of the net proceeds of this offering not deposited in the trust account, without taking into account any interest earned on the trust account, we expect that the initial per-share redemption price will be approximately $10.20. The proceeds deposited in the trust account could, however, become subject to claims of our creditors that are in preference to the claims of our stockholders. Furthermore, our underwriters may seek recourse against the proceeds in the trust account relating to any future claims they may have against us. In addition, if we are forced to file a bankruptcy case or an involuntary bankruptcy case is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. Therefore, the actual per-share redemption price may be less than approximately $10.20. We will pay the costs of any subsequent liquidation from our remaining assets outside of the trust account. If such funds are insufficient, our sponsor has agreed to pay the funds necessary to complete such liquidation and has agreed not to seek repayment for such expenses. We currently do not anticipate that such funds will be insufficient. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per share due to reductions in the value of the trust assets, less taxes payable; provided that TABLE OF CONTENTS such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable), nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties, including, without limitation, claims by vendors and prospective target businesses. TABLE OF CONTENTS Summary of Risk Factors We are a newly formed company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision on whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company, as well as the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act, and, therefore, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see Proposed Business Comparison to offerings of blank check companies subject to Rule 419. You should carefully consider these and the other risks set forth in the section entitled Risk Factors beginning on page 27 of this prospectus. An investment in our securities involves a high degree of risk. The occurrence of one or more of the events or circumstances described in the section titled Risk Factors, alone or in combination with other events or circumstances, may materially adversely affect our business, financial condition, and operating results. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to: We are a recently incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by our management team or their respective affiliates may not be indicative of future performance of an investment in us. Our stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our stockholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash. If we seek stockholder approval of our initial business combination, our initial stockholders have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. The requirement that we consummate an initial business combination within 18 months (or such later date as approved by our stockholders) after the closing of this offering may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19) outbreak and the status of debt and equity markets. If we seek stockholder approval of our initial business combination, our initial stockholders, directors, executive officers, advisors, and their affiliates may elect to purchase public shares or warrants, which may influence a vote on a proposed business combination and reduce the public float of our common stock or public warrants. TABLE OF CONTENTS If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss. Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. You will not be entitled to protections normally afforded to investors of many other blank check companies. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we have not consummated our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per public share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate for the 18 months following the closing of this offering, it could limit the amount available to fund our search for a target business or businesses and our ability to complete our initial business combination, and we will depend on loans from our sponsor, its affiliates or members of our management team to fund our search and to complete our initial business combination. TABLE OF CONTENTS
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, company or our company are to Chenghe Acquisition Co., a Cayman Islands exempted company with limited liability; amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association which will take effect upon the consummation of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands; Chenghe Group are to Chenghe Group Limited, a British Virgin Islands incorporated company, the sole member and manager of the sponsor; founder shares are to Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination as described herein; initial shareholders are to holders of our founder shares prior to this offering; Mainland China, or PRC are to the People s Republic of China, which for purposes of this prospectus, does not include the Hong Kong Special Administrative Region of China, the Macau Special Administrative Region of China or Taiwan; management or our management team are to our officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team and advisory board to the extent any of them purchases public shares, provided that each initial shareholder s and member of our management team or advisory board s status as a public shareholder will only exist with respect to such public shares; public warrants are to the warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); sponsor are to Chenghe Investment Co., a Cayman Islands exempted company with limited liability; and warrants are to our public warrants and private placement warrants and any warrants issued upon conversion of working capital loans. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any forfeiture of shares, and all references to forfeiture of shares, described in this prospectus shall take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. TABLE OF CONTENTS General We are a newly incorporated blank check company incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not generated revenues to date and we do not expect that we will generate operating revenues at the earliest until we consummate our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any potential business combination target with respect to an initial business combination with us. While we may pursue a business combination target in any business, industry or location, we intend to focus on financial technology ( fintech ) or technology-enabled financial service companies, including artificial intelligence, big data, cloud and blockchain-related initiatives in Asian markets, which can benefit from the expertise and capabilities of our management team to create long-term shareholder value. However, we will not undertake our initial business combination with any entity based in or with its principal business operations in Mainland China, Hong Kong or Macau. Our Sponsor Chenghe Investment Co., our sponsor, is a Cayman Islands exempted company with limited liability incorporated in 2021 with Chenghe Group, a British Virgin Islands incorporated company, as its sole member and manager. Chenghe Group is an investment holding company which seeks to invest globally in visionary management teams and growth companies with disruptive innovations and provide quality investment advisory services to its portfolio companies. The major investment areas in which Chenghe Group focuses on include TMT (technology, communications and media), healthcare, consumer and other new economic industries. Our initial shareholders, which include our sponsor, currently own an aggregate of 2,875,000 Class B ordinary shares, up to 375,000 of which by our sponsor will be surrendered to us for no consideration after the closing of this offering depending on the extent to which the underwriters over-allotment option is exercised, which will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to the adjustments described herein. Prior to the completion of our initial business combination, only holders of Class B ordinary shares will have the right to vote on (i) the appointment of directors or (ii) continuing the company in a jurisdiction outside the Cayman Islands (including any special resolution required to amend the constitutional documents of the company or to adopt new constitutional documents of the company, in each case, as a result of the company approving a transfer by way of continuation in a jurisdiction outside the Cayman Islands). On any other matters submitted to a vote of our shareholders, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, except as required by law. In addition, Our sponsor has committed to purchase certain amount of warrants in a private placement that will close simultaneously with the closing of this offering. Our sponsor and each member of our management team have agreed to vote their founder shares and public shares in favor of our initial business combination. Our sponsor, together with our officers and directors, have also entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. Mr. Richard Qi Li, our chairman of the board, who holds 100% of the voting securities of Chenghe Group, may be entitled to distributions of the founder shares and has sole voting and investment discretion with respect to the ordinary shares held by Chenghe Group through Chenghe Investment Co. The founder shares and the private placement warrants and any Class A ordinary shares issued upon conversion or exercise thereof held by our sponsor are each subject to transfer restrictions pursuant to lock-up provisions in the agreement entered into by our sponsor and management team. For details of the lock-up provisions, see the section entitled Principal Shareholders Transfers of Founder Shares and Private Placement Warrants. TABLE OF CONTENTS Except as described in the section entitled The Offering Limited payments to insiders, we have not paid and do not currently intend to pay any finder s fees, reimbursement, consulting fee, monies in respect of any payment of a loan or other compensation to our sponsor, officers or directors, or any affiliate of our sponsor or officers prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). Our Team Our management team is led by Kenneth W. Hitchner, the chairman of our advisory board, Richard Qi Li, the chairman of our board, Dr. Zhiwei Liu, our senior advisor, Dr. Shibin Wang, our chief executive officer and a member of our board of directors, and Anna Zhou, our chief financial officer. Each member of our management team and advisory board members has significant experience in identifying and investing in attractive growth opportunities both in Asia and globally. Kenneth W. Hitchner Kenneth W. Hitchner will serve as the chairman of our advisory board immediately upon the effectiveness of our registration statement on Form S-1, of which this prospectus is a part. Mr. Hitchner brings to the company a wealth of financial services experience gained through his 28-year career at Goldman Sachs. Mr. Hitchner began his career at Goldman Sachs in New York City in 1991, in the investment banking division, and became a partner of the firm in 2002. Throughout his career at Goldman Sachs, Mr. Hitchner held various positions in which he took a leadership role in creating and growing several key business units spanning numerous industry verticals and multiple geographies. Prior to his retirement from Goldman Sachs in 2019, Mr. Hitchner served as the chairman and chief executive officer of Goldman Sachs in Asia Pacific Ex-Japan and as a member of Goldman Sachs Global Management Committee. Mr. Hitchner has significant experience in providing high quality deal sourcing and transactional advice to a broad range of clients. Over the course of his career at Goldman Sachs, Mr. Hitchner led, managed or executed well over 100 transactions involving in excess of $300 billion in the aggregate, including M&A and equity-related transactions across multiple geographies and sectors. Selected recent transactions in the financial services sector that Mr. Hitchner led and on which he served his clients as a trusted advisor include: China Renaissance Holding Ltd. s $345 million initial public offering and listing on the Main Board of The Stock Exchange of Hong Kong Limited in 2018; and Guotai Junan Securities Co. Ltd. s $2.1 billion initial public offering and listing on the Main Board of The Stock Exchange of Hong Kong Limited in 2017, which was a landmark transaction in the financial services sector because Guotai Junan was China s third-biggest brokerage in terms of sales and its flotation was the second-largest IPO in terms of market value globally in 2017. Shenwan Hongyuan Group Co., Ltd. s US$1.16 billion initial public offering and listing on the Main Board of The Stock Exchange of Hong Kong in 2019. Following his relocation to Hong Kong in 2013, Mr. Hitchner, in his capacity as the chairman and chief executive officer of Goldman Sachs in Asia Pacific Ex-Japan, provided oversight to a number of significant transactions leveraging his extensive knowledge and experience in technology and new economy related transactions. Selected transactions in which Mr. Hitchner was involved included Ping An Health Cloud s approximately $500 million private placement in 2016, as well as Goldman Sachs underwriting of the initial public offerings of Xiaomi Corporation, Pinduoduo Inc., China Tower Corporation Limited, Meituan Dianping, WuXi AppTec and Tencent Music Entertainment Group. As part of his leadership role at Goldman Sachs Asia, Mr. Hitchner was responsible for driving business initiatives to capitalize on new economy trends and further developing and growing Goldman Sachs Asia business overall. Mr. Hitchner has maintained frequent dialogues and strong relationships with leading technology and fintech-related companies and business leaders both globally and across Asia. Mr. Hitchner was a trusted advisor to many clients whom he helped guide through their strategic decision-making processes, allowing him to build an extensive network of proprietary and deep relationships. Since his departure from Goldman Sachs, Mr. Hitchner has maintained frequent dialogues and strong relationships with leading technology and fintech-related companies and business leaders both globally and across Asia. TABLE OF CONTENTS Mr. Hitchner is an adjunct professor at Columbia Business School and a member of the Bio Frontiers Institute Advisory Board at the University of Colorado. He also serves on the advisory board of the Faculty of Business and Economics at The University of Hong Kong, and is also a member of the board of directors of Wuxi Biologics and a Senior Advisor of Wuxi Apptec. Mr. Hitchner has served as the chairman of the board of HH&L Acquisition Co. since 2020 and as an independent non-executive director of Provident Acquisition Corp. since 2021. Each of HH&L Acquisition Co. and Provident Acquisition Corp is a blank check company formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. Additionally, Mr. Hitchner has served as a senior advisor to Valliance Asset Management Limited, a multi-strategy fund, since 2020, and as a member of the advisory board of Antler, a global early-stage venture capital firm, since 2021. We believe that Mr. Hitchner s deep relationships, network and experience in the technology and fintech sectors across Asia and globally provide our company with distinctive and complementary capabilities and add significant value to what we can offer to potential target companies. Richard Qi Li Richard Qi Li, the chairman of our board, has more than two decades of experience in the financial service industry. Until February 2021, Mr. Li had been, from 2017, the chief investment officer and, from 2019, the chief operating officer of China Great Wall AMC (International) Holdings Company Limited and, from 2018, the chief executive officer of Great Wall Pan Asia Asset Management Ltd., both subsidiaries of China Great Wall Asset Management Co. Ltd., a leading asset management company based in China. Mr. Li was previously a managing director and the head of China securities at Goldman Sachs Asia, and a managing director and the head of north Asia capital markets and treasury solutions at Deutsche Bank Hong Kong. Prior to joining Deutsche Bank, Mr. Li worked at Merrill Lynch, the World Bank, and the Ministry of Finance of the PRC. Mr. Li also serves as the chief executive officer and director of HH&L Acquisition Co., an NYSE-listed blank check company formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. Mr. Li has worked with or advised many financial institutions in Greater China on capital markets activities, sales and trading of fixed income products and structured equities, investment, risk management, and/or building up trading or asset management platforms. His clients or counterparts have included leading sovereign wealth funds (State Administration of Foreign Exchange and China Investment Corporation), large banks (Bank of China, Industrial and Commercial Bank of China, Agricultural Bank of China, China Construction Bank and China Merchants Bank), insurers (China Life, PICC, Ping An Insurance) and asset managers (National Social Security Fund, China Asset Management and Harvest Fund). Mr. Li also advised Shanghai Pudong Development Bank in connection with the formation of a business alliance and the establishment of a credit card joint venture with Citibank in 2002. In addition, Mr. Li s experience includes investment in Meituan Dianping, one of China s top-tier e-commerce companies, We Doctor Holdings Limited, one of China s top-tier online healthcare companies, Biotest AG, a Germany-based blood plasma products marker, and Bio Products Laboratory Ltd., a UK-based plasma biotherapeutics company. He has also been involved, as either an investor or an advisor, in investments in the consumer, energy and real estate sectors in Asia and globally. Mr. Li also has experience leading several significant capital raising transactions. Mr. Li obtained a bachelor s degree in mathematics and a master s degree in economics from Nankai University in China and a master of business administration from Columbia Business School. He was also a visiting scholar at Harvard University in 2019. Dr. Zhiwei Liu Dr. Zhiwei Liu will serve as a senior advisor to our company immediately upon the effectiveness of our registration statement on Form S-1, of which this prospectus is a part. Dr. Liu is the largest shareholder of Wealthking Investments Limited (or Wealthking , stock code: 1140.HK) as of May 8, 2020 and he has served as chairman of Wealthking Investments Limited since 2019. Prior to Wealthking, Dr. Liu held multiple senior positions in a number of China s leading financial institutions, including China Great Wall Securities TABLE OF CONTENTS Co. Ltd. from 1992 to 1997, Guosen Securities Co. Ltd. from 1997 to 1998, Xinjiang Huitong Group Ltd. from 2005 to 2008, and Chang an International Co. Ltd. from 2008 to 2011. Wealthking is a cross-border and cross-sector investment platform listed on the Main Board of The Stock Exchange of Hong Kong Limited in 2003. Under Dr. Liu s leadership, Wealthking collaborates with leading institutional and entrepreneur investors to invest primarily in growth-oriented industries in China. Wealthking s extensive network roots in Asia, particularly in Greater China, provide it with access in the region that it believes gives Wealthking a competitive advantage relative to global funds domiciled outside of Asia. Taking advantage of its access to long-term capital as a listed companies, Wealthking focuses on investing in industry leaders, which Wealthking considers to be a long-term core holdings among its portfolio companies. Leveraging its strengths in investment and financing, Wealthking has established various PE/VC funds and executed add-on deals to invest in businesses surrounding its core portfolio companies in order to continually enhance and improve relationships between companies in its ecosystem of investee companies. Under Dr. Liu s leadership, some of Wealthking s prior investments in the fintech space include: CSOP Asset Management ( CSOP ), a well-known asset management company managing private and public funds and providing investment advisory services to Asian and global investors with a dedicated focus on investing in China; Oriental Patron Investment Management, a leading hedge fund platform in Asia serving both global and Asia-based managers in developing funds across diversified strategies for institutional and professional investors; Jiedaibao, a fintech company providing comprehensive technology-enabled financial services to individuals and enterprises, such as contract signing, registration and post-loan management. With licenses to engage in businesses including online payment, commercial banking and internet microloan services, jiedaibao is focused on building a comprehensive fintech ecosystem; and Beijing International Trust Co., Ltd. (or BITIC ), a China-based large scale non-banking financial institution, which primarily engages in trust, investment fund, financial services, brokerage and advisory business. Dr. Liu also has extensive personal investment experiences in fintech and technology-related sectors. Some selected personal investments of Dr. Liu include: Asia Digital Currency Co., a company dedicated to exploring and executing digital currency initiatives, including issuance and operation of digital currency, experimenting with digital currency applications, research and development relating to blockchain-related technologies and development of talents in the field. The company was founded in Hong Kong with connections to a number of high profile political and business personnel; SpinQ, a company dedicated to exploring innovative quantum computing solutions for real-world problems. SpinQ was founded by top researchers from leading institutions worldwide, including the Institute for Quantum Computing at the University of Waterloo, Tsinghua University, Hong Kong University of Science and Technology and Southern University of Science and Technology; QuantumCTek, a pioneer and leader in commercialized quantum information technology (or QIT ) in China. QuantumCTek is committed to providing a competitive QIT portfolio of quantum secure solutions in telecom infrastructure, enterprise networks, cloud computing, as well as big data technology and services; and Basis Set Ventures, an investment company that invests in early-stage technology companies that aim to fundamentally transform the way people work, with the belief that artificial intelligence delivers core value by improving productivity for all parts of the economy. Wacai Holdings Limited, one of the earliest fintech companies established in China, which has gradually evolved into an Internet finance platform with a wide array of personal financial management tools and services, wealth management services and credit solutions. Dr. Liu received a bachelor s degree in industrial management engineering from Zhejiang University, a master s degree in international finance from the Graduate School of PBC (now known as the PBC School of Finance, TABLE OF CONTENTS Tsinghua University) and a Ph.D. in economics from Hunan University. Dr. Liu also completed a professional course for Financial CEOs at Cheung Kong Graduate School of Business, and participated in the China CEO Global Studies Program at Shanghai Jiaotong University. Dr. Shibin Wang Dr. Shibin Wang, is our chief executive officer and as a member of our board of directors, has over 15 years experience in sales and trading of structured financial products, cross-border financing and other capital market activities. Over such period, his clients or counterparts have included major banks (China Development Bank, Industrial and Commercial Bank of China, Agriculture Bank of China and China Construction Bank), leading organizations (China National Offshore Oil Corporation and GCL-Poly Energy) and leading private equity firms (Hillhouse Capital and Greenwoods Asset Management). Dr. Wang was an executive director and head of China structure solutions at Deutsche Bank Hong Kong from 2010 to 2015. Prior to that, he worked at FICC Goldman Sachs from 2008 to 2010 and at China Development Bank managing a fixed-income portfolio from 2003 to 2008. Since April 2019, Dr. Wang has served as a co-founder and the chief executive officer of Hong Kong Digital Asset Ex Ltd. (or HKbitEX ), a regulated digital asset exchange in Hong Kong dedicated to providing a regulatory-compliant and safe digital asset spot trading and over-the-counter trading services to professional investors in Asia. Under Dr. Wang s leadership, the company was among the first organizations in Asia-Pacific to apply for a virtual asset trading platform licence from the Securities and Futures Commission in Hong Kong, and was recognized as one of China s top 50 fintech companies in the 2020 KPMG China Fintech 50. In 2018, Dr. Wang advised the Intelligent Investment Chain Foundation on funding and ecosystem development. The Intelligent Investment Chain Foundation is a decentralized virtual asset management application developed based on Ethereum smart contracts with an ecology including quantitative funds, cross-chain wealth management wallets and media. Dr. Wang s served Oriental Patron Financial Group as chief marketing officer from 2016 to 2018, during which he led the company s blockchain initiatives and fintech investments. Under Dr. Wang s leadership, Oriental Patron made investments in DIDI Chuxing and CarbonX, organized a number of forums with leading institutions as well as established the Renminbi-denominated Fintech/Internet Plus fund, with Renminbi 3 billion of assets under management, in collaboration with Magnetic Capital in Shanghai. Dr. Wang is also shareholder of SECUSOFT Tech, Jiedaibao and ZhongYou International Education. Dr. Wang obtained a bachelor s degree in international trading from Dongbei University of Finance & Economics, as well as a master of economics degree and a Ph.D, both from the Finance Institute of the People s Bank of China. Anna Zhou Ms. Anna Zhou, our chief financial officer, has considerable experience in equity research and finance. Ms. Zhou focused on equity research since beginning her career in 2011 and specialized in the China and US Technology, Media, and Telecom ( TMT ) sector including smartphones, digital consumer products, internet services and emerging platform economies. She has been working on in-depth research and rigorous valuation studies in various sectors. She was a senior associate at Mighty Divine Investment Management Limited from 2019 to 2021, the research associate of the long-only portfolio of China Great Wall AMC (International) Holdings Company Limited from 2017 to 2019 and the QDII fund of Anbang Asset Management (Hong Kong) Co. Limited from 2016 to 2017. She also spent two years in BOCOM International Holdings Company Limited ( BOCOM International ) as a data analyst in its market strategy team from 2014 to 2016, publishing weekly notes on China s commodity sector. Ms. Zhou has been involved in investments in Futu Holdings Ltd., Meituan Dianping, Bilibili Inc. and Pingduoduo Inc. when she worked as an equity analyst at Mighty Divine Investment Management Limited, and investments in Sunny Optical Technology (Group) Company Limited when she worked as an equity analyst at China Great Wall AMC (International) Holdings Company Limited. Ms. Zhou received a bachelor s degree in mathematics, information and application from Universit Paris 5 and a master s degree in financial mathematics and statistics from The Hong Kong University of Science and Technology. TABLE OF CONTENTS Kwan Sun Kwan Sun will serve as an independent director of our company immediately upon the effectiveness of our registration statement on Form S-1, of which this prospectus is a part. Mr. Sun founded Millburn Advisory LLC, a real estate fund manager, in 2018 and has served as its managing partner since then. From 2015 to 2018, Mr. Sun served as the vice chairman of Nan Fung Group s US businesses to help develop Nan Fung Group s US real estate business. Mr. Sun served as a director at Deutsche Bank in structured products department from 1997 to 2003, and as a director at Morgan Stanley in structured products department from 2003 to 2007. Thereafter, Mr. Sun served as a managing director at Deutsche Bank in structured products department from 2007 to 2009 and as a managing director at Morgan Stanley in the investment banking department from 2009 to 2014. Prior to joining Deutsche Bank in 1997, he served as a vice president the capital markets department of Merrill Lynch, where he focused on trading fix income derivatives. He joined Merrill Lynch in 1992. Mr. Sun graduated with a bachelor s degree from Ohio State University. Robert Ewing Robert Ewing will serve as an independent director of our company immediately upon the effectiveness of our registration statement on Form S-1, of which this prospectus is a part. Mr. Ewing has served as a strategic consultant to the chief executive officer at Diametric Capital, an innovative start-up hedge fund in Boston, since 2017. Prior to such role at Diametric Capital, Mr. Ewing served as head of US equities and as a portfolio manager for Putnam Investments, an investment manager in Boston, from 2008 to 2016, where he was responsible for all aspects of the investment management operations. Mr. Ewing was also responsible for managing Putnam Investments flagship fund, The Putnam Fund For Growth and Income. At Putnam Investments, Mr. Ewing was responsible for personnel, compensation, product and performance and was a member of its operating committee. Mr. Ewing was also one of the members of Putnam Investments risk committees with responsibilities for risk across all asset classes and investments. Additionally, Mr. Ewing chaired the proxy and governance committee of Putnam Investments, where, among other things, he was responsible for proxy votes and trustee interaction. Prior to joining Putnam Investments, Mr. Ewing was a founder and co-head of the Boston office of RiverSource Investments from 2002 to 2008. He was responsible for all aspects of operations from product and strategy to process and performance and also managed the equity portion of the RiverSource Balanced Fund. Mr. Ewing started his full-time career as an analyst at Fidelity Investments in 1990 and served as a portfolio manager from 1996 to 2002 at Fidelity Investments. In recognition of his performance, he was awarded a Best-In-Class designation by Mutual Funds Magazine in 2001 and 2002. Mr. Ewing has served as a director of The Fenn School, a non-profit organization in Concord, Massachusetts. At The Fenn School, Mr. Ewing has served as Chair of the Committee on Trustees with responsibilities for board governance and nominations and as a member of the Executive Committee from 2011 to 2018. Mr. Ewing received a bachelor s degree from the Honors Program of Boston College Carroll School of Management. Ning Ma Ning Ma will serve as an independent director of our company immediately upon the effectiveness of our registration statement on Form S-1, of which this prospectus is a part. In 2015, Mr. Ma founded Lingfeng Capital Partners, Limited ( Lingfeng ), a private equity firm focusing on investing in fintech companies in Asia, in sub-sectors such as artificial intelligence, blockchain, cloud, big data, lending technology, insurance technology, health care services, investment technology, payment and credit rating, and digital assets. Mr. Ma has served as a partner at Lingfeng since 2015. Prior to founding Lingfeng, Mr. Ma worked at Goldman Sachs (Asia) L.L.C. ( Goldman Sachs ) for thirteen years from 2002 to 2015 where, among other roles, he served as co-head of the Asia Pacific Financial Institutions Equity Research. He was also a member of the Goldman Sachs China Operating Committee and TABLE OF CONTENTS a member of the Asia Pacific Client and Business Standards Committee. He held various positions with Beijing Gao Hua Securities Company Limited and served as the deputy general manager and managing director from 2010 to 2015. Prior to Goldman Sachs, Mr. Ma was a regulator at the headquarters of the People s Bank of China from 1996 to 2000, where he was actively involved in the regulation, financial reform and policy-making relating to foreign banks and non-bank financial institutions including trust companies, asset management companies, finance companies and leasing companies in China. Mr. Ma currently serves as an independent director for several financial institutions in Asia including Ant Consumer Finance Company, China Renaissance Securities and BOCOM International. He has been teaching at Tsinghua University PBC School of Finance since 2010. Mr. Ma received a bachelor s degree from Renmin University of China, a master s degree in business administration from London Business School and a master s degree in international finance from Tsinghua University PBC School of Finance. We are passionate about fintech and helping build outstanding fintech businesses. We believe we have assembled a strong team with a proven track record in identifying, investing and value creation for leading fintech or technology-enabled financial service companies on the back of their global network and rich capital markets experience in Asia and around the world. We believe our team is well-positioned to take advantage of the growing set of acquisition opportunities relevant to our business strategy and that our contacts and relationships, ranging from owners of private and public companies, private equity funds, investment bankers, attorneys, accountants and business brokers should provide us with a number of business combination opportunities and will ultimately allow us to consummate our initial business combination. With respect to the foregoing experience of our team, past performance is not a guarantee (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of our team s performance as indicative of our future performance. For more information on the experience and background of our management team, see the section entitled Management and Advisory Board. In addition, with respect to the foregoing information you should take into consideration that the entities which our officers, directors and advisors previously served or which they currently serve or with which they currently have business relationships have (i) no interest in or affiliation with our company and (ii) no obligation to provide services to us, to assist us in identifying or consummating an initial business combination or to otherwise assist us in any way. Except for Mr. Kenneth W. Hitchner, who is the chairman of the board of HH&L Acquisition Co. and an independent director of Provident Acquisition Corp., and Mr. Richard Qi Li, who is the chief executive officer and director of HH&L Acquisition Co., none of our other directors, management and advisory board members has any past experience with any blank check companies or special purpose acquisition companies. Certain of our officers, directors and advisors have fiduciary and contractual duties to investment vehicles and business enterprises other than our company. As a result, certain of them may have a duty to offer acquisition opportunities to other entities and will have no duty to offer such opportunities to our company unless presented to them in their capacity as an officer or director of our company. In addition, our officers, directors and advisors are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among their various business activities, including identifying any potential business combination, monitoring any related due diligence and transaction execution activities, and managing any entity that is involved in our initial business combination. Moreover, certain of our advisors, officers and directors may have time and attention obligations to investment vehicles and/or business enterprises other than our company; and, in addition, the compensation arrangements between such individuals and such other investment vehicles and/or business enterprises (e.g., the potential for such individuals to receive bonuses or payments of carried interest based on performance or investment results) may result in certain of such individuals prioritizing the interests of such other investment vehicles and/or business enterprises over our interests. In addition, our officers, directors and advisors may sponsor or form other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target. TABLE OF CONTENTS Business Strategy We intend to capitalize on the experience of our team to acquire one or more fintech or technology-enabled financial service businesses in Asian markets, which can benefit from the expertise and capabilities of our management team in order to create long-term shareholder value. The total of fintech investment activities in Asia from 2014 to 2019 grew by more than three times and the growth of market value by deal size of 15.6% in the next ten years is expected to outpace North America and Europe. The year of 2020 was a game changer as the COVID-19 pandemic made digitization a critical priority for financial institutions and we believe the trend will likely continue and create new opportunities and potential business combination targets that were previously not as viable. According to a KPMG biannual report entitled Pulse of Fintech H2 2020 in February 2021, these changes include, but were not limited to: accelerating digital adoption by financial institutions, including the demand for e-payment solutions and digital banking services; customer behaviors and attitudes towards use of e-commerce platforms, digital customer service channels and e-wallets; platform companies and large tech companies continue to branch into financial services areas to broaden service offerings and mature fintechs continue to expand into adjacencies to drive more customer value; and increasing attention from governments and regulators as to how fintech is evolving and what needs to be done to support the changes. Our selection process will leverage our team s broad and deep network of relationships, unique industry expertise and proven deal-sourcing capabilities to provide us with a strong and differentiated pipeline of potential targets. Our team has experience in: sourcing, structuring, acquiring and selling businesses; investing in businesses globally and enabling them to build and/or grow their business in the Greater China or other Asian markets, applying our unique market, policy and government insights; helping target companies gain access to the Greater China or other Asian markets as well as secure funding from other reputable investors and lenders, managing and operating companies, setting and changing strategies, and identifying, mentoring and recruiting top-notch talent; developing and growing companies, both organically and inorganically; fostering relationships with sellers, capital providers and target management teams; and accessing public and private capital markets to optimize capital structure, including financing businesses and helping companies transition ownership structures. Immediately following the completion of this offering, we intend to begin the process of communicating with the network of relationships within our team to search for a potential target for our initial business combination and begin the process of pursuing and reviewing potential opportunities. Certain members of our board and management team are located in Hong Kong. We do not believe that this will make us materially less attractive as a partner for potential targets or materially limit the pool of business combination candidates. Competitive Strengths We believe that the sourcing, valuation, diligence and execution capabilities of our team will provide us with a significant pipeline of differentiated opportunities from which to evaluate and select a business that will benefit from our expertise. Our competitive strengths include the following: Leading Industry Insights and Proprietary Sourcing Channels. We believe our team s global insights and experience will allow us to identify suitable opportunities in fintech and tech-enabled financial service sectors that enjoy solid fundamentals yet may be under-invested and/or undervalued. Our team s extensive experience in the financial services industry as well as their other corporate relationships have TABLE OF CONTENTS helped them develop a broad array of contacts in the fintech sector. Finally, we believe that with the advice and support of our sponsor, we will have unique access to a pipeline of acquisition opportunities in Asia that may not be easily replicable by other market participants. We believe that these factors will give us an edge in terms of sourcing targets for our initial business combination; Investing Experience. We believe that our team s track record of identifying, sourcing and advising on transactions positions us well to appropriately evaluate potential business combinations that have a strong potential to be well received by the public markets; Execution and Structuring Capability. We believe that our team s combined expertise and reputation will allow us to source and complete transactions possessing structural attributes that create an attractive investment thesis. These types of transactions are typically complex and require creativity, industry knowledge and expertise, rigorous due diligence, and extensive negotiations and documentation. We believe that by focusing our investment activities on these types of transactions, we will be able to generate investment opportunities that have attractive risk-reward profiles; and Long-term Value and Strategic Partnership. We believe that our team can create long-term value by collaborating with target management teams, forming strategic partnerships and enhancing performance. Our Target Market Opportunities We will not undertake our initial business combination with any entity based in or with its principal business operations in Mainland China, Hong Kong or Macau. We intend to complete a business combination with fintech or technology-enabled financial service companies that are exposed to favorable macroeconomics, technology, digitization and policy trends in Asia such as the following: Macroeconomic: rising disposable income, personal savings and consumption expenditures thanks to rapid urbanization and increase of education levels; Technology: rapid development and sophistication of financial technology to accelerate trends and changes under way across the financial services industry; Digitalization: increasing mobile internet users and changing customer behavior; and Policy: support for inclusive finance and technology innovation. We have not narrowed the business combination target in any particular fintech verticals, however, we do believe the following areas represent attractive opportunities: Insurtech Increasing awareness of the need for protection and the aging population have contributed to rapid growth in the life and health insurance markets. Digital-savvy Gen Z are becoming more keen to access the market via online insurers. On-going digitalization of the economy drives substantial opportunities for innovative, scenario-based property and casualty insurance products. The overall premiums paid in the insurance market in Asia reached $1.7 trillion in 2019, and are expected to grow to $2.1 trillion in 2025, according to BMI research. Wealthtech and online broker The growth of the wealthtech and online broker sector is mainly driven by the combination of fast growth of personal investable assets, generational change, increasing investor sophistication and the rise of attractive new digital investment offerings. Meanwhile, Asia investable assets are set to surpass $47 trillion in 2023, with an implied CAGR at 10.0% compared with $18 trillion in 2013, according to a report entitled Reigniting Radical Growth issued by Boston Consulting Group in June 2019. With approximately 15 million high-net-worth-individuals (or HNWI ) and an expanding middle-income class, Asia has become the region with the second-highest concentration of HNWI globally. We believe that strong market performance coupled with reduced offline activities amid COVID-19 has boosted user appetite for online brokerage. TABLE OF CONTENTS Digital payment The convenience, efficiency and high penetration of digital and mobile technology are expected to drive the growth of digital payments in Asia. The global pandemic has enhanced interest in the payments space given the rapid acceleration of digital trends and demand for alternative payments models. Digital payment transaction volume in Asia Pacific is expected to further expand at a CAGR of 11.1% between 2019 and 2025, far ahead of Middle East and Africa (7.5%), North America (4.1%), and Western Europe (2.9%) accordingly to Passport. Online consumer financial service segments Online consumer financial service segments, such as consumer finance, are experiencing significant growth driven by rapidly growing consumption needs and consumer leverage. The outstanding balance of consumer finance in Asia reached $13.0 trillion in 2019 and is expected to reach $23.0 trillion in 2025, with an implied CAGR of 10.8% according to Euromonitor. We believe that further penetration of unbanked population and underserved demand would support consumption in the long run. Digital assets and blockchain We observed increasing market trends toward greater interest in and acceptance of digital assets as a new investable asset class. The regulators in Asia have also developed regulatory frameworks and licensing regimes for digital asset providers, which are essential for bringing in good practices and market infrastructure to further operationalize the crypto and digital asset industry. The approximate size of the digital asset market in 2020 is $1.0 trillion, according to CoinMarketCap. Based on our estimate, assuming 1% of traditional asset classes are tokenized, the size of the digital asset market could reach $13 trillion. Financial information system The financial services industry has seen drastic technology-led changes over the past few years. Financial institutions look to improve efficiency and facilitate game-changing innovation, while also lowering costs and continuing to support legacy system. The advancement of technology in AI, big data, cloud and blockchain are the driving forces to accelerate technology adoptions by financial institutions and help them enhance risk management and optimize customer experience. The total technology expenditure of financial services industry in Asia reached $161 billion in 2019. The growth momentum is expected to continue and such expenditure is expected to reach $241 billion in 2025 for Asia, growing at a CAGR of 7.0% from 2019, according to Gartner and other public sources. Business Combination Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We intend to use these criteria and guidelines in evaluating initial business combination opportunities, but we may decide to enter into our initial business combination with target business or businesses that do not meet any or all of these criteria and guidelines. However, we will not undertake our initial business combination with any entity based in or with its principal business operations in Mainland China, Hong Kong or Macau. Focus on targets with operations in the fintech or tech-enabled financial service sectors. With the extensive networks and insights our team has built in our target sectors, we are confident that we will have access to a broad range of investment opportunities and a competitive advantage in our ability to negotiate an initial business combination with potential targets in such sector. We expect our management team s network of contacts to provide us with robust opportunities to source compelling targets, evaluate them and consummate a business combination with one or several of these targets; Targets with capabilities to leverage the compelling market trends in Asian markets. We intend to target one or more businesses that have gained sustainable competitive advantages, demonstrated potential for strong growth in the future, and have significant opportunities in and/or synergies with Asian markets. We believe this approach will enable us to effectively leverage our strong network to identify attractive opportunities and that the larger market capitalization and public float of the resulting company will be more attractive to our investors; TABLE OF CONTENTS Targets with large addressable market and high growth prospects. We intend to invest in companies with fundamentally sound business models that operate in a large underlying addressable market with strong tail winds that we believe will support significant growth and superior returns over time, including those with embedded or underexploited growth opportunities or those that may benefit from synergistic add-on acquisitions, increased production capacity, expense reductions, technology upgrades and increased operating leverage; Targets with the potential to further improve under our ownership. Our management team has a history of accelerating growth of companies with strong historical performance. We believe our team s experience in our target sectors and network of industry contacts have the potential to generate opportunities to enhance the financial and operational efficiencies of the target businesses, through identifiable catalysts that could transform the value of these investments, and potentially offer an attractive return for our shareholders; Experienced and visionary management team. Our team has an extensive network in our target sectors including many well-recognized industry leaders. We intend to seek targets with an established management team that we can complement. To the extent we believe it will enhance shareholder value, we would seek to selectively supplement the existing management team of the business with members of our team and/or with proven leaders from our network; and Benefit from capital market access. We intend to seek targets that would benefit from being a public company with an increased public profile, enhanced governance and increased access to a more diversified pool of capital. These criteria are not intended to be exhaustive. We will also utilize our operational and capital allocation experience. Any evaluation relating to the merits of a particular initial business combination may be based on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into a business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials, as applicable, that we would file with the SEC. In evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspections of facilities, as well as reviewing financial and other information which will be made available to us. Our search for a business combination, ability to consummate a business combination, or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected by factors beyond our control. For example, see Risk Factors Risks Relating to our Search for, Consummation of, or Ability to Consummate, a Business Combination and Post-Business Combination Risks The COVID-19 pandemic and the impact on business and debt and equity markets, as well as protectionist legislation in our target markets could have a material adverse effect on our search for a business combination, and any target business with which we ultimately complete a business combination. Acquisition Process In evaluating a potential target business, we expect to conduct a comprehensive due diligence review to seek to determine a company s quality and its intrinsic value. That due diligence review may include, among other things, financial statement analysis, detailed document reviews, multiple meetings with management and employees, consultations with relevant industry experts, competitors, interviews of customers and suppliers, inspection of facilities, as well as a review of additional information that we will seek to obtain as part of our analysis of a target company. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers, directors or members of our advisory board, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers, directors or members of our advisory board. In the event we seek to complete an initial business combination with a target that is affiliated with our sponsor, officers, directors or members of our advisory board, we, or a committee of independent directors, would obtain an opinion from an independent investment banking firm that is a TABLE OF CONTENTS member of FINRA or a valuation or appraisal firm that such an initial business combination is fair to our company from a financial point of view. Members of our team and our independent directors will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors is included by a target business as a condition to any agreement with respect to our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We will not undertake an initial business combination with any entity based in or with principal business operations in Mainland China, Hong Kong or Macau. We currently do not have any specific business combination under consideration. Our officers and directors and advisory board members have neither individually selected nor considered a target business nor have they had any substantive discussions regarding possible target businesses among themselves or with our underwriters or other advisors. Our team is regularly made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a business combination transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Further, certain of our directors and officers and members of our advisory board may have fiduciary and/or contractual obligations to other entities including but not limited to HH&L Acquisition Co., and other entities in which they have invested or may invest. As a result, such directors, officers or members of our advisory board may have a duty to offer acquisition opportunities to such other entities. In addition, although we expect Mr. Kenneth W. Hitchner and Dr. Zhiwei Liu to provide us with business insights, advice and support regarding deal sourcing and potential acquisition opportunities in their capacity as advisory board members, they do not serve as our directors or officers and have no fiduciary or contractual duty to provide us with acquisition opportunities. Moreover, certain of our advisory board members, officers and directors may have time and attention obligations to investment vehicles and/or business enterprises other than our company; and, in addition, the compensation arrangements between such individuals and such other investment vehicles and/or business enterprises may result in certain of such individuals prioritizing the interests of such other investment vehicles and/or business enterprises over our interests. In addition, our officers, directors and advisors may sponsor or form other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target. Our sponsor, officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. In particular, certain of our officers and directors have, and will have in the future, time and attention requirements to the Chenghe Group and HH&L Acquisition Co., which may detract from time spent on our affairs. To the extent any conflict of interest arises between us and the Chenghe Group and HH&L Acquisition Co. (including, without limitation, arising as a result of our officers and directors offering acquisition opportunities to the HH&L Acquisition Co.), these conflicts may not be resolved in our favor and a potential target business may be presented to other entities prior to its presentation to us, subject to the fiduciary duties of our directors and officers under Cayman Islands law. For further discussions about potential conflict of interest, please see Risk Factors Our officers and directors and advisory board members, will allocate their time and other resources to other businesses unrelated to us, thereby causing conflicts of interest in their determination as to how much time and resources to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. and Risk Factors Our officers and directors and advisory board members presently have, and any of them or future members of the TABLE OF CONTENTS advisory board in the future may have additional, fiduciary or contractual obligations to other entities and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. In addition, our sponsor, officers and directors and advisory board members may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination. However, we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination. In addition, our directors and officers and advisory board members are not required to commit any specified amount of time to our affairs and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Initial Business Combination The rules of the Nasdaq and our amended and restated memorandum and articles of association require that we must consummate an initial business combination with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the trust account (excluding the amount of any deferred underwriting discount held in trust) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination (including with the assistance of financial advisors), we will obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. Additionally, pursuant to Nasdaq rules, any business combination must be approved by a majority of our independent directors until the 80% of net assets test described above is satisfied. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940 (the Investment Company Act ), as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post transaction company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock or shares of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. TABLE OF CONTENTS The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information Our executive offices are located at 38 Beach Road #29-11, South Beach Tower Singapore 189767, and our telephone number is +65 98518611. We are a Cayman Islands exempted company with limited liability. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non- convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30. TABLE OF CONTENTS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands; completion window are to the period following the closing of this offering at the end of which, if we have not completed our initial business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions and as further described herein; the completion window ends 18 months from the closing of this offering; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering, and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); initial shareholders refers to all of our shareholders immediately prior to the date of this prospectus, including all of our officers and directors to the extent they hold such shares; management or our management team are to our executive officers and directors (including our director nominees that will become directors in connection with the consummation of this offering); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans, if any; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; rights refer to the rights which are being sold as part of the units in this offering; sponsor are to Jaguar Global Growth Partners I, LLC, a Delaware limited liability company; warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants to the extent they are no longer held by the initial purchasers of the private placement warrants or their permitted transferees; and we, us, our, company or our company are to Jaguar Global Growth Corporation I, a Cayman Islands exempted company. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and TABLE OF CONTENTS EXPLANATORY NOTE Jaguar Global Growth Corporation I is filing this Amendment No. 4 to its registration statement on Form S-1 (File No. 333-260483) to correct inadvertent printer errors in the filing of Amendment No. 3. TABLE OF CONTENTS an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Our Company We are a blank check company incorporated on March 31, 2021 as a Cayman Islands exempted company incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to our offering. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. We have generated no operating revenues to date, and we do not expect that we will generate operating revenues until we consummate our initial business combination at the earliest. While we may pursue an initial business combination target in any stage of its corporate evolution or in any industry, sector or geographical location, we currently intend to concentrate our efforts on identifying high quality businesses in industries that complement our management team s background and businesses which provide innovation at the intersection of real estate and technology, a category broadly referred to as PropTech. We intend to focus our efforts on businesses outside of the United States, although the business combination target may include a business based in the United States which has all, some or no operations or opportunities outside of the United States. As the largest asset class globally, the real estate industry is vast and includes, but is not limited to: (i) commercial real estate such as office buildings, multi-family buildings, retail centers, industrial warehouses, hotels, self-storage facilities, medical office buildings, student housing, senior housing and data centers; and (ii) residential real estate such as single family homes and condominiums. Within the real estate industry, we will focus on businesses that provide technology solutions to make the real estate industry more accessible, affordable, autonomous, collaborative, connected, data-driven, digital, dynamic, efficient, experiential, flexible, productive, profitable, smart, transparent and/or virtual. Global PropTech Trends We believe that the real estate industry is undergoing significant changes as a direct result of technological innovation, and that existing and emerging real estate technologies have the potential to create trillions of dollars of enterprise value over time. KPMG s 2019 Global Proptech survey highlights that 95% of real estate companies have someone responsible for leading digital transformation and innovation. Continuing on this trend, technology is rapidly penetrating all verticals of the real estate industry on a global scale, with developing and developed countries only now starting to catch-up in what is an increasingly established high-growth sector in geographies such as the United States. New demand drivers are emerging across all sectors of the real estate industry traditionally one of the most illiquid, opaque, fragmented and low-tech asset classes in the U.S. economy. These trends are prompting entrepreneurs to create technologies and build companies that digitally transform and disrupt the outdated technology and operating models of real estate. Over 94% of investors believe that COVID-19 is accelerating the adoption of PropTech in the real estate industry. For example, cloud-based software solutions are modernizing the way real estate is operated, particularly in light of increasing remote work due to COVID-19; modular technology, pre-fabrication and internet of things, or IoT, are reshaping property design, development, construction and operations; marketplaces and crowdfunding platforms are expanding real estate ownership and services to a broader and distributed pool of participants; and the proliferation of data is allowing for the application and more efficient pricing of financial technology, or FinTech, solutions to real estate, such as data-driven property management, risk management, investment and asset management tools. Additionally, high growth, innovative and demand-driven real estate sectors, such as healthcare, education, data infrastructure, cold storage and logistics, are experiencing tremendous tailwinds. TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 1, 2022 PRELIMINARY PROSPECTUS Jaguar Global Growth Corporation I $200,000,000 20,000,000 Units Jaguar Global Growth Corporation I is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Although we reserve the right to pursue an acquisition opportunity in any business or industry, we intend to search for a target business operating primarily outside of the United States in the PropTech sector. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share, one right and one-half of one redeemable warrant. Each right entitles the holder thereof to receive one-twelfth (1/12) of one Class A ordinary share upon the consummation of our initial business combination. As a result, a rights holder must have 12 rights in order to receive a Class A ordinary share at the closing of our initial business combination. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The warrants will become exercisable 30 days after the completion of our initial business combination and will expire five years after completion of our initial business combination. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,000,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. If we have not completed our initial business combination within 18 months from the closing of this offering (the completion window ), we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. Our sponsor has agreed to purchase 11,250,000 warrants (or 12,450,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment, at a price of $1.00 per warrant in a private placement to occur concurrently with the closing of this offering. The private placement warrants are identical to the warrants sold in this offering, subject to certain limited exceptions as described in this prospectus. Our initial shareholders, which include our sponsor, currently own 7,666,667 Class B ordinary shares, up to 1,000,000 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment and removal of directors and to continue our company in a jurisdiction outside the Cayman Islands. Our sponsor has agreed that upon and subject to the completion of the initial business combination, 25% of the founder shares then held by the sponsor shall be considered to be newly unvested shares, which will vest only if the closing price of our Class A ordinary shares on the Nasdaq Global Market ( Nasdaq ) equals or exceeds $12.50 for any 20 trading days within a 30 trading day period, on or after the first anniversary of the closing of the initial business combination but before the fifth anniversary. Founder shares, if any, that remain unvested at the fifth anniversary of the closing of the initial business combination will be forfeited, subject to certain exceptions as described in the letter agreement. Currently, there is no public market for our securities. We intend to apply to have our units listed on Nasdaq, under the symbol JGGCU. We expect that the Class A ordinary shares, rights and warrants comprising the units will begin separate trading on the Nasdaq under the symbols JGGC, JGGCR and JGGCW, respectively, on the 52nd day following the date of this prospectus unless the representatives of the underwriters permit earlier separate trading and we have satisfied certain conditions. We cannot guarantee that our securities will be approved for listing on the Nasdaq. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 43 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 11,000,000 Proceeds, before expenses, to us $ 9.45 $ 189,000,000 (1) Includes $0.35 per unit, or $7,000,000 in the aggregate (or $8,050,000 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. Does not include certain fees and expenses payable to the underwriters in connection with the offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $204,000,000, or $234,600,000 if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case), will be deposited into a non-interest bearing trust account located in the United States with Continental Stock Transfer & Trust Company, acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Joint Book-Running Managers Citigroup Barclays The date of this prospectus is , 2022 TABLE OF CONTENTS These trends have been prevalent in the United States and are expanding globally, including into emerging markets such as Asia and Latin America, and more advanced markets such as Europe. Asia s GDP is projected to overtake the GDP of the rest of the world combined and by 2030 the region is expected to contribute roughly 60% of global growth. In the coming years, Asia-Pacific is expected to be responsible for 90% of the 2.4 billion new members of the middle class. In addition, we are seeing comparable trends in other advanced and emerging markets, including Europe as well as countries in Latin America, such as Mexico, Brazil and others. We believe our global experience will allow us to take advantage of growing international markets and find an attractive business for an initial business combination. Market Opportunity We believe that there are and will be a significant number of high-growth private real estate operating and PropTech companies valued between $500 million and $1.5 billion, which creates an ideal target opportunity set for our initial business combination. As the PropTech sector continues to grow, we expect there will be a large number of companies valued over $1.0 billion. Based on recent surveys, 42% of PropTech companies indicate it is likely their company will be acquired, go public or have a liquidity event in the next three years. Real estate is the largest asset class in the world with an estimated global asset value of $228 trillion in 2017, including more than $32 trillion in commercial real estate assets. The PropTech sector has grown rapidly over the past several years. Venture capital investment in PropTech has risen dramatically, with approximately $98 billion raised worldwide between 2012 and 2020 and over 3,000 PropTech companies have been launched since 2009. According to MetaProp s 2020 Global PropTech Confidence Index, 59% of investors that responded expect to make more PropTech investments over the next 12 months, up from 33% at mid-year 2020. Additionally, many PropTech companies have matured to a point where they may consider public market capital solutions to sustain their growth trajectories. PropTech today has the same funding size as FinTech in 2013. Given Fintech s compounded annual growth of 44.8% since 2013, we believe that the prospects for PropTech are compelling. We will seek to invest in businesses that offer innovative software, hardware, products, operations, or services that are technologically equipped to improve property ownership, property financing, property valuation, property operations, property management, leasing, property insurance, real estate asset management and investment management and design, construction and development. These businesses have a large market audience and many different customers, including landlords, homeowners, tenants, developers, operators, managers, brokers, investors, lenders, architects, engineers and general contractors. We believe the market for real estate technology businesses is attractive for a number of reasons, including but not limited to: Large and High-Growth Market. Venture capital funding in PropTech reached $32 billion in 2019 compared to $4 billion in 2016. We believe digitalization will continue to grow rapidly, especially in our target geographies, as we see further data-driven decision making, replacement of middle-men with marketplaces and incumbents embracing technology. Technological Innovation Transforming Real Estate. Technology is penetrating the real estate asset class, driving innovation across transactions, work processes, tenant engagement and the operations of buildings. Robust, Discerning Pipeline Opportunities. Since 2016, more than $69 billion in enterprise value has been created within the real estate technology sector across public and private companies. Public Markets Respond to PropTech. 2020 saw a divergence between the public market performance of the traditional real estate businesses versus real estate technology businesses. Traditional real estate companies underperformed with the Dow Jones US Real Estate Index down 9%, while a number of public real estate technology companies saw significant increases in share price. We will seek to invest in established businesses of scale that we believe are poised for continued growth with capable management teams and proven unit economics, but potentially in need of financial, operational, strategic or managerial enhancement to maximize value. We do not intend to, but we have the option to, TABLE OF CONTENTS invest in start-up companies, companies with speculative business plans, or companies that are excessively leveraged. Additionally, as a result of COVID-19, we believe there are attractive businesses that may have additional capital needs over the next few years, which could further increase the pipeline of potential opportunities. Following a business combination, we intend to work with the target s management team to help drive growth and long-term, sustainable value creation at the company. Our Partnership We are a partnership between Gary R. Garrabrant and Thomas J. McDonald (the Jaguar Founders ), who are experienced executives with extensive deal-making and investment management experience, most recently through their partnership, Jaguar Growth Partners Group, LLC ( Jaguar ), a holding company for a differentiated, global investment management firm focused on real estate private and public equity in developing and developed markets, and Hennessy Capital Group LLC ( Hennessy Capital Group ), a leading independent SPAC sponsor. We seek to leverage the global industry relationships and extensive SPAC experience of our officers, directors and advisors with founders, venture capitalists and growth equity managers to identify, screen, select, and partner with a high growth, cutting-edge real estate operating, or PropTech business. Our management team believes that its unique access to global real estate operating and PropTech companies, coupled with a demonstrable SPAC track record, will be central to its differentiated investment strategy. About Jaguar Growth Partners Group, LLC Jaguar is a holding company formed by the Jaguar Founders for the purpose of holding the controlling interest in other entities such as Jaguar Growth Partners, LLC ( JGP ), an institutional investment management firm focused on real estate companies, operating in compelling growth markets globally. Founded in 2013, Jaguar is privately held by the Jaguar Founders. Over their careers, the Jaguar Founders have deployed more than $1.4 billion of capital and managed over $3 billion of assets in more than 20 portfolio companies across 12 countries in Asia, Europe and Latin America. We will leverage the Jaguar Founders capabilities, relationships, networks, third-party investment support functions and deal pipeline to support us in the identification and diligence of potential targets for the initial business combination. The Jaguar Founders approach to investing has been developed and refined over 20 years, using their long-standing experience, global presence and extensive networks to formulate differentiated investment themes across core industry sectors and geographies. The Jaguar Founders utilize thesis-driven investment strategies informed by deep sector knowledge, experience and proprietary research and networks to identify differentiated, typically off-market investment opportunities. In addition to a core focus on backing talented entrepreneurs and management teams, the broader investment strategy hinges on the development of specific industry theses and seeking to combine the right management teams with these theses to create successful portfolio companies. As part of the differentiated approach to investing, the Jaguars Founders global formal and informal network of professionals work collaboratively across geographies and sectors to ensure that the right people with the right experience are able to assist in achieving investment objectives. Jaguar s investment approach emphasizes the importance of local teams and advisors spanning North America, Latin America, Europe and Asia. The Jaguar Founders bring a distinguished reputation that is characterized by a (i) partner-centric highly active approach to investing in privately-held and publicly-held real estate operating platforms and companies in developing and developed markets; and (ii) history at the vanguard of growth markets with a proven track record implementing innovative solutions and technologies which include the implementation of omni-channel/e-commerce solutions in the Brazil retail sectors and incorporating mobility analytics top support reservation, pricing and yield management in the Mexican hospitality sector. The Jaguar Founders have also demonstrated success across investment segments including, retail, logistics, homebuilding, hospitality, healthcare, specialty finance, real estate and technology. Within each sector, Jaguar s network is further organized by deep subsector specialization. The Jaguar Founders current investments are centered in JGP. JGP s current discretionary funds, which are managed by Jaguar Growth Asset Management, LLC, an SEC-registered investment advisor, TABLE OF CONTENTS include: (i) Jaguar Real Estate Partners I and II, LP, which are exclusively focused on Latin America and diversified by multiple geographies, sectors and company stages; and (ii) Jaguar Partners Asia L.P., the inaugural fund in an anticipated series of funds dedicated to scalable real estate opportunities across Asia, inclusive of sectors such as warehouse, distribution and logistics, cold storage, data infrastructure and housing None of JGP, Jaguar Real Estate Partners I and II, LP, and Jaguar Partners Asia L.P. s investment teams were involved in or will be involved in the formation and/or management of the Company. We believe that the Jaguar Founders long history, industry and geographic knowledge and extensive and long-established relationships provide a significant advantage in sourcing new transactions. Jaguar s transactions are principally sourced through Jaguar s relationships with entrepreneurs, industry contacts, institutional investors and outside advisors rather than through intermediated and competitive auctions. To illustrate these deal sourcing capabilities, since 2013, Jaguar has sourced 100% of its deals through Jaguar s relationships rather than through competitive auctions. We believe that Jaguar s expansive network, composed of current and former portfolio company executives and board members as well as long-standing industry relationships, serves as a distinct competitive advantage in the identification, evaluation, execution and management of the target company. The Jaguar Founders bring over two decades of experience and an extensive track record of investing in diversified sectors such as retail, logistics, homebuilding, hospitality, healthcare, specialty finance, real estate and technology. For example, in 2020, Jaguar, in partnership with the founders of one of Asia s premier real estate private equity platforms, jointly acquired an established, asset-light, vertically integrated logistics operator and developer. Jaguar identified several drivers leading to the opportunity in the Asia logistics sector such as demand for modern warehouses driven by domestic consumption growth and e-commerce penetration and the limited quality site availability and access. Jaguar partnered with operating executives who have deployed $2 billion over the past 16 years on behalf of global institutional limited partners. Jaguar was able to capitalize on long-term secular trends by leveraging Jaguar s history, track record and extensive relationships in the region to invest in operating platforms and properties across traditional and alternative real estate sectors throughout Asia. The Jaguar Founders, while at a prior prominent investment management real estate firm, recorded a notable success following an invitation to transform a regional, affordable entry-level homebuilder into an institutional quality national leader. Homex, a Mexican homebuilder, incorporated innovative propriety technology such that we believe it may be considered one of the first PropTech businesses. Recognized as singular, the Homex technology effectively integrated and monitored every aspect of operations, including land acquisition, construction, payroll, purchasing, sales, quality control, financing, delivery, and maintenance. The technology resulted in lowered construction costs, controlled payroll costs, administered client relations, and propelled growth, with plans to implement this technology to large-scale home building ventures in various growth markets including China, India and the Persian Gulf. The Homex platform investment is a good example of the Jaguar Founders ability to optimize their investment strategy to construct a business platform and exit the platform at the most opportune time so as to maximize their investment return and minimize their investment risk profile. The Jaguar Founders strategic direction and development of domestic and international growth initiatives led to highly successful NYSE and Mexican Bolsa public offerings and a 16.8x gross multiple / 81% gross IRR on investment. In 2000, after two years of deep market diligence and with the tailwinds of NAFTA and its impact on regional free trade, the Jaguar Founders invested in Corporate Properties of Americas. Working with founding partners of Black Creek Group, the Jaguar Founders transformed a limited scope development platform into an institutional industrial property owner and operator. A transformational capitalization of $250 million, a first by a major U.S. state pension fund, an innovative $300 million portfolio debt financing with Met Life and GE Capital and growing the national portfolio to over 10 million square feet are among the attributes that lead to a 3.0x gross multiple on invested capital and a 25% gross IRR on investment. In 2011, following years of evaluating prospective partners and investment opportunities in India, the Jaguar Founders made an investment in early-stage hotel company SAMHI. Headquartered in Gurgaon, SAMHI was founded and led by a local entrepreneur who previously established the Indian presence of a publicly traded hotel company with a global presence. SAMHI was and is distinguished by its management team, focus on high-growth markets, and the first investment in India by the Jaguar Founders. TABLE OF CONTENTS In 2018, Jaguar invested in Bresco Growth Fundo de Investimento Imobili rio ( Bresco ), an established, logistics real estate platform that capitalizes on strong demand from multinational corporations seeking Class A, institutional quality space in Brazil. Bresco s portfolio of R$2.3 billion of net asset value (USD$442 million), 594,000 square meters of gross leasable area, or GLA, and 21 assets with total expansion plans expected to reach 1.5 million square meters of combined GLA by 2023. In December 2019, Bresco created a publicly listed yield fund (FII Bresco Logistica) to serve as an acquirer of Bresco s developments and increase competitiveness in SLB purchases. Jaguar has also demonstrated success in the retail industry which has generated significant return on investment. As an example, in 2016, Jaguar invested in AliansceSonae, a leading publicly-held Brazilian shopping center owner-operator and led the company in what s believed to be the first public-to-public merger within the Brazilian shopping mall sector. AliansceSonae is the largest shopping mall by number of properties comprising 39 shopping malls and approximately 1.4 million meters of GLA. About Hennessy Capital Group Hennessy Capital Group is a Wilson, Wyoming and Los Angeles, California based alternative investment firm founded in 2013 by Daniel J. Hennessy. Since its founding, Hennessy Capital Group has been one of the leading independent SPAC sponsors, having raised, together with its managing partners, a total of eight SPACs since 2013 aggregating over $1.8 billion of equity. Hennessy Capital Group s mission is to be a strategic growth partner for founders, management, employees and shareholders. The Hennessy Capital Group team is led by Daniel J. Hennessy, Thomas D. Hennessy and M. Joseph Beck. Mr. Daniel J. Hennessy, the Founder and Managing Member of Hennessy Capital Group, is one of the longest tenured and most experienced independent SPAC sponsors. He has served as the Chairman and Chief Executive Officer of Hennessy Capital Acquisition Corp., Hennessy Capital Acquisition Corp. II, Hennessy Capital Acquisition Corp. III, Hennessy Capital Acquisition Corp. IV, Hennessy Capital Investment Corp. V (NASDAQ: HCIC) and Hennessy Capital Investment Corp. VI (NASDAQ: HCVI). Mr. Hennessy has successfully orchestrated four successful business combinations with Blue Bird Corporation (NASDAQ: BLBD), Daseke, Inc. (NASDAQ: DSKE), NRC Group Holdings Corp. (NYSE American: NRCG, acquired by NASDAQ: ECOL) and Canoo Holdings Ltd (NASDAQ: GOEV). In addition, Mr. Hennessy was a senior advisor to PropTech Acquisition Corporation, or PTAC, a special purpose acquisition company which announced its business combination with Porch.com, Inc. (NASDAQ: PRCH), or Porch, in July 2020 and is currently a senior advisor to each of PropTech Investment Corporation II (NASDAQ: PTIC), or PTIC, a special purpose acquisition company which conducted an initial public offering in December 2020, and 7GC & Co. Holdings Inc. (NASDAQ: VII), or VII, a special purpose acquisition company which conducted an initial public offering in December 2020. With a combined 27 years of real estate experience, Mr. Thomas D. Hennessy and Mr. Beck bring a unique track record, proprietary relationships and deep expertise that is suited to take advantage of the growing set of investment opportunities in the PropTech space and to create shareholder value. Since 2019, Mr. Hennessy and Mr. Beck have served as the Managing Partners of Growth Strategies of Hennessy Capital Group. Mr. Hennessy and Mr. Beck were formerly senior investment professionals of Abu Dhabi Investment Authority, or ADIA, the world s largest institutional real estate investor. While at ADIA, Mr. Hennessy conceived and led ADIA s PropTech initiative and investment mandate, which included extensive due diligence on every major U.S. PropTech venture capital fund as well as meetings with numerous PropTech founders and companies. Mr. Hennessy s PropTech efforts at ADIA resulted in assembling a global team of investment professionals, creating a network and establishing relationships with the major global PropTech participants and ultimately making a significant investment into PropTech. Since November 2019, Mr. Hennessy and Mr. Beck were Co-CEOs of PTAC, the first SPAC to target businesses in PropTech, and in July 2020 announced its entry into a definitive agreement for an initial business combination with Porch, a leading software and services platform for the home inspection and home service industries that provides ERP and CRM software to inspection, moving and adjacent home services companies, gaining access to a proprietary and reoccurring sales funnel which includes a majority of homebuyers in the U.S. annually. The transaction included a $150,000,000 fully committed common stock private investment at $10.00 per share led by Wellington Management Company, LLP. Since December 2020, Mr. Hennessy and Mr. Beck serve as Co-CEOs of PTIC and directors of VII. TABLE OF CONTENTS Hennessy Capital Group s contacts and relationships are extensive across both the real estate and the property technology landscape, providing superior access to PropTech. Its network includes partners at venture capital, private equity funds, strategic PropTech investors and founders of real estate technology companies. We intend to leverage this network to gain exclusive access to and identify attractive target businesses in PropTech. Since its founding, Hennessy Capital Group has developed proprietary SPAC execution expertise and built a network of top-tier third-party advisors and relationships to assist with target company origination, evaluation, due diligence, and merger execution. This network of advisors has supported Hennessy Capital Group in various roles for its various SPACs and is deeply integrated within Hennessy Capital Group s SPAC execution framework. We believe Hennessy Capital Group s proven SPAC track record supports our investment thesis and strategy, and that potential sellers of target businesses will view our execution capabilities with a vehicle similar to our company as a positive factor in considering whether or not to enter into a business combination with us. Management Team Our team is led by Gary R. Garrabrant, our Chairman and Chief Executive Officer. Mr. Garrabrant is the Chief Executive Officer and co-founder of Jaguar, as well as JGP. Mr. Garrabrant has been the Chief Executive Officer of Jaguar, as well as JGP since their formation in 2013. Prior to the creation of Jaguar, Mr. Garrabrant co-founded Equity International in 1999 and was Chief Executive Officer and Director from 1996 to 2012. Mr. Garrabrant has extensive real estate, investment management and banking experience. Mr. Garrabrant has served as Chairman, Vice Chairman and Director of a number of companies spanning multiple geographies and sectors including Capital Trust (NYSE: CT, now Blackstone Mortgage Trust), Gafisa (NYSE: GFA), Homex (NYSE: HXM) and Xinyuan (NYSE: XIN). Mr. Garrabrant graduated from the University of Notre Dame with a B.B.A. in Finance and completed the Dartmouth Institute at Dartmouth College. Our management team also includes Thomas J. McDonald, our President and a director. Mr. McDonald is co-founder of Jaguar and JGP. Mr. McDonald has been Managing Partner of Jaguar as well as Managing Partner and Head of Americas of JGP since their formation in 2013. Prior to the creation of Jaguar, Mr. McDonald was the Chief Strategic Officer of Equity International, primarily responsible for developing its collaborative, partner-oriented investment style, as well as coordinating investment and portfolio management activities. From 1997 to 1999, Mr. McDonald was Executive Vice President of Anixter International (NYSE: AXE). From 1993 to 1997, Mr. McDonald resided in Argentina and was responsible for establishing operating businesses for Anixter in Brazil, Argentina, Chile, Venezuela and Colombia. Mr. McDonald graduated from the University of Notre Dame and received his M.B.A. from the University of Chicago s Booth School of Business. Anthony R. Page, our Chief Financial Officer, has been the Head of Risk Management of JGP since January 2021 and previously served as a JGP senior advisor from 2015 to 2020. From 2006 to 2010, Mr. Page served as Senior Vice President and Director of Commercial Mortgage Investments for Capstead Mortgage Corporation (NYSE: CMO). From 2001 to 2015, Mr. Page served as Managing Partner of Perimone Investment Partners. From 1996 to 2000, Mr. Page was a principal at Apollo Real Estate Advisors focusing on international investments while residing in New York and Hong Kong. Mr. Page serves on the boards of directors of Brilliant China, the Dallas Housing Finance Corp., the McKinney Avenue Transit Authority, and Uptown Dallas Inc., as well as the University of Virginia McIntire School of Commerce Advisory Board. Mr. Page is a CFA Charterholder, a Chartered Alternative Investment Analyst, was previously a certified public accountant, graduated from the University of Virginia with a B.S. in Commerce and completed the Advanced Management Development Program at the Harvard University Graduate School of Design. Our management team s and advisors contacts and relationships are extensive across the global real estate ecosystem, providing superior access to potential targets. Our network includes partners at venture capital and private equity funds with investments in high growth real estate operating and PropTech companies as well as founders of such companies. We intend to leverage this network to gain exclusive access to and identify attractive target businesses. TABLE OF CONTENTS In addition, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including investment banking firms, consultants, legal and accounting firms and large business enterprises. Upon completion of this offering, members of our management team will communicate actively with our networks of relationships to articulate parameters for a potential business combination target. Board of Directors We have recruited and organized a group of highly accomplished and engaged directors and independent directors who will bring to us public company governance, executive leadership, operations oversight and capital markets expertise. Our board members have served as directors, officers, partners and other executive and advisory capacities for publicly listed and privately-owned companies and private equity and venture capital firms. Our directors and director nominees have extensive experience with public equity investing, mergers and acquisitions, divestitures and corporate strategy and possess relevant domain expertise in the sectors where we expect to source business combination targets. We believe their collective expertise, contacts and relationships will make us a highly desirable merger partner. In addition to supporting us in the areas of assessment of key risks and opportunities and due diligence, members of our board of directors may also advise us after the completion of our business combination in overseeing our strategy and value creation plan where relevant expertise exists. The backgrounds of our other directors and director nominees are highlighted below: Thomas D. Hennessy serves as Chairman, Co-Chief Executive Officer and President of PTIC and is the former Chairman, Co-Chief Executive Officer and President of PTAC. Mr. Hennessy formerly served as a director of Porch and has served as a director of VII since December 2020. Mr. Hennessy has served as a Managing Partner of Growth Strategies of Hennessy Capital Group, since July 2019. Mr. Hennessy served from 2014 to 2019 as a Portfolio Manager of ADIA. M. Joseph Beck is the former Co-Chief Executive Officer and Chief Financial Officer of PTAC, and is currently the Co-Chief Executive Officer and Chief Financial Officer of PTIC. Mr. Beck has served as a director of VII, since December 2020. Mr. Beck has served as a Managing Partner of Growth Strategies of Hennessy Capital Group, since July 2019. Mr. Beck served from 2012 to 2019 as a Senior Investment Manager of ADIA. From 2008 to 2012, Mr. Beck served in the Investment Banking Division of Goldman, Sachs & Co. Craig Hatkoff is one of the earliest pioneers of commercial real estate and mortgage securitization in North America. Mr. Hatkoff is the Executive Chairman of LEX, the first commercial real estate securities marketplace that enables accredited and unaccredited investors to invest in individual properties and a leading PropTech platform, and the co-founder of the Disruptor Awards at Disruptor Foundation. Mr. Hatkoff is nominated to become a director for Monmouth Real Estate Investment Corporation. Mr. Hatkoff also co-founded the Tribeca film festival, and serves as the Chairman of Turtle Pond Publications. He serves on the board of some of the largest public real estate investment companies including SL Green (NYSE: SLG), having previously served on the boards of Colony Capital (NYSE: CLNY) from 2019 to 2021, and Taubman Centers from 2004 to 2019 before its acquisition by Simon Property Group. Christine Zhao is a director and the Chief Financial Officer of Edoc Acquisition Corp. (NASDAQ: ADOC), a healthcare focused special purpose acquisition company, and a director and Audit Committee Chair of D and Z Media Acquisition Corp. (NYSE: DNZ), a special purpose acquisition company focused on media and education technology. Ms. Zhao is a managing director and Chief Financial Officer for Tiedemann Advisors, a wealth management company. She serves as a venture partner at YuanMing Capital, and is a member of the board of directors of BeyondSpring (NASDAQ: BYSI) and Urban FT. Ms. Zhao is the former Chief Financial Officer of two large private equity backed companies, one of which, BEST Inc. (NYSE: BEST), was successfully listed on the New York Stock Exchange. She previously worked at JP Morgan, Bank of America and Goldman Sachs. Mrs. Zhao brings deep public company experience in China and the United States. Martha Notaras is a Managing Partner at Brewer Lane Ventures and serves on the boards of Cowbell Cyber, Lynk, Cape Analytics, Palomar Holdings Inc. (NASDAQ: PLMR) and ATTOM TABLE OF CONTENTS Data Solutions. Prior to joining Brewer Lane, Ms. Notaras was Partner at XL Innovate, and ran the corporate development for the business analytics division of the Daily Mail. Ms. Notaras has served as board director for many early and growth stage companies, in fintech, insurtech, proptech, edtech and digital media. Ms. Notaras prior experience includes investment banking at Merrill Lynch and commercial banking at Credit Suisse. Michael Berman serves as the Chief Executive Officer of MB Capital Associates, a commercial real estate investment firm, and has 35 years of experience in the real estate and finance industries. Mr. Berman served as the Chief Financial Officer and Executive Vice President of General Growth Properties and Equity LifeStyle Properties. Mr. Berman was a member of the investment banking department at Merrill Lynch & Co. Mr. Berman is a member of the Board of Directors and the Audit Committee Chair of Brixmor Property Group Inc. (NYSE: BRX). He is a member of the Board of Directors, the Audit Committee Chair and a member of the Governance and Nominating Committee of Skyline Champion Corp. (NYSE: SKY). Mr. Berman was also a member of the Board of Directors and member of the Audit and Compensation committees of Mack-Cali Realty Corporation (NYSE: CLI) from 2020 to 2021. Jason H. Lee serves as Co-Chairman of Brilliant China, a leading integrated developer, operator, and investment manager of logistics warehouses and related industrial properties in China. Mr. Lee, along with his partners, acquired Brilliant in 2020. Mr. Lee served as Managing Director-Partner and Head of Asia Real Estate based in Hong Kong with The Carlyle Group, and founded Carlyle Asia Real Estate in 2001. Prior to joining Carlyle, Mr. Lee worked for The Argo Partnerships in New York, two opportunistic real estate investment funds focused on North America, sponsored by The O Connor Group and J.P. Morgan. Prior to The Argo Partnerships, Mr. Lee worked for Disney Development Company, the real estate arm of The Walt Disney Company. Advisors In addition to the directors and director nominees described above, we have recruited four highly accomplished strategic advisors who will bring to us significant experience in special purpose acquisition companies, global investment management, public and private equity and debt capital markets. Our strategic advisors will advise us on public company governance, executive leadership, human capital management, corporate strategy and capital markets. Our strategic advisors have served as directors, officers, executives and partners for publicly-listed and privately-owned companies, private equity firms, and global investment managers. In addition to advising us in the areas of assessment of key risks and opportunities and due diligence, our senior advisors may also advise us after the completion of our business combination in overseeing our strategy and value creation plan where relevant expertise exists. The backgrounds of our advisors are highlighted below: Daniel J. Hennessy is Founder and Managing Partner of Hennessy Capital Group, Chairman and CEO of both Hennessy Capital Investment Corp. V and Hennessy Capital Investment Corp. VI, and Senior Advisor to PTIC and VII. Betty Liu is Chairman, President and Chief Executive Officer of D and Z Media Acquisition Corp. (NYSE: DNZ), a special purpose acquisition company focused on news and knowledge sectors. She is formerly Chief Experience Officer at Intercontinental Exchange (NYSE: ICE) and Executive Vice Chairman for NYSE Group. Scott F. Meadow is Clinical Professor of Entrepreneurship at University of Chicago Booth School of Business, teaching over 10,000 students in Entrepreneurship, Innovation, and Private Equity & Venture Capital. Mr. Meadow has over 30 years of experience as a general partner with four venture capital and private equity firms, including William Blair Venture Partners, The Frontenac Company, The Sprout Group and, most recently, the Edgewater Funds, where he remains an Associate Partner. Edward Shenderovich, is the Founder and Managing Director of Essential Capital. Prior to Essential Capital, he founded and was the Managing Partner of Kite Ventures. He is the co-founder and former Chairman of Knotel. He is also a former board member of Merchantry, Inc, Tradeshift, Inc., Delivery Hero Holding GmbH (ETR: DHER) and other technology businesses. He also served as a founding executive for SUP Media ZAO. TABLE OF CONTENTS Evan Wray, is the Co-Founder and Chief Executive Officer of Mavely. Since 2017, Mr. Wray has served as a Venture Partner for Trail Mix Ventures. Through Trail Mix Ventures, Mr. Wray is board observer of four portfolio companies across food logistics, recycling networks, mobile gaming and D2C ecommerce. In 2012, Mr. Wray co founded Swyft Media and served as Co-Founder and Chief Executive Officer from 2012 to 2015. In 2015, Monotype Imaging (NASDAQ: TYPE) acquired Swyft, where Evan continued to lead the organization as the VP of the newly formed Consumer Division. From 2016 to 2019, he was founding partner of Irish Beef. In addition, Evan sits on the Venture Builders Advisory Board at the University of Notre Dame, where he received a B.A. in Economics in 2012. Past performance of our management team, or advisors, Jaguar, Hennessy Capital Group and their respective affiliates is not a guarantee either (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical performance record of such parties. Business Combination Criteria Our strategy is to identify and acquire later-stage real estate technology businesses, with a focus on high-growth fundamentals, whose pace of growth can benefit from our operational prowess, capital markets experience and global connectivity. We intend to leverage our sponsor s extensive expertise and broad network of strategic LPs, portfolio companies, real estate relationships and reputation in the real estate and related technology sectors to identify investment opportunities with meaningful near term growth potential that can generate attractive risk-adjusted returns for our shareholders. Consistent with this strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. Target Business Size. Businesses with an aggregate enterprise value of $500 million or greater, determined in the sole discretion of our management team. High Growth Global Operating Platform. Innovative, high growth, demand-driven businesses in the global real estate sector (e.g. warehouse, cold storage, distribution and / or logistics) with the ability to capitalize on demographic-fueled growth in emerging markets, and / or the rapid transition from conventional to e-commerce markets further accelerated with the onset of COVID-19. Real Estate Technology. Businesses in the Tech sector or subsector, with particular emphasis on targets with the potential to disrupt the PropTech, construction technology, sharing economy, smart cities and energy spaces in a high-growth global geographical market through digital transformation and innovation seeking to replace established incumbents still relying on legacy technologies and business practices. Target Secular Demographic Trends. Compelling businesses at the cusp of transforming rapidly growing consumption driven sectors, such as healthcare, education or data infrastructure in global emerging, developing or developed markets, benefiting from positive secular demographic and economic tailwinds. Proven Unit Economics and Growing Companies. Established businesses with proven business models that we believe are poised for a period of high growth with capable management teams, attractive gross margins, strong unit economics and a demonstrated path to EBITDA profitability, but potentially in need of financial, operational, strategic or managerial support which our sponsors are uniquely positioned to deliver. Leverage our sponsors Global Relationships, Experiences and Networks. Close to our proximal co-invest networks of founders, operators, investors, and advisors. Benefit From Being a Public Company. Management, founders and shareholders with a desire to go public, to unlock growth capital for organic and / or merger and acquisition driven growth. TABLE OF CONTENTS Focused Investment Criteria. We do not intend to invest in start-up companies, companies with speculative business plans, or companies that are excessively leveraged. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Acquisition Process In evaluating a prospective target business, we expect to conduct a disciplined due diligence review of issues that we deem important to validating our investment thesis and assessing a company s business quality and value creation opportunities, allowing our management team to price returns relative to potential risks appropriately. This review may encompass, among other things, review of financial information and key documents of the target business, research related to the target company s industry, markets, products, services and competitors, meetings with incumbent management and employees, on-site visits and a review of other information which will be made available to us. Our approach to the acquisition process will be centered on utilizing the existing networks and knowledge bases of Jaguar and Hennessy Capital Group, relying on outside resources where appropriate. In addition, we will seek to leverage our management team s operational and capital allocation expertise to target high-quality, scalable businesses with significant proof of concept where we see multiple opportunities for continued organic and strategic growth. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. Jaguar, Hennessy Capital Group and members of our management team may directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at a purchase price of approximately $0.004 per share, the holders of our founder shares (including certain of our directors and officers that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public shareholders lose money on their investment as a result of a decrease in the post-business combination value of their Class A ordinary shares (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our partners, employees, officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such partners, employees, officers and directors will be included by a target business as a condition to any agreement with respect to our initial business combination. We currently do not have any specific business combination under consideration. Our officers and directors have neither individually selected nor considered a target business nor have they had any substantive discussions regarding possible target businesses with our underwriters or other advisors. Jaguar, Hennessy Capital Group and our management team are continuously made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any discussions, formal or otherwise, with respect to a business combination transaction with us. Our amended and restated memorandum and articles of association waives the corporate opportunities doctrine in effect by providing that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy TABLE OF CONTENTS in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. See Risk Factors Risks Relating To Our Sponsor And Management Team Our Officers And Directors Presently Have, And Any Of Them In The Future May Have, Additional Fiduciary, Contractual Or Other Obligations To Other Entities, Including Another Blank Check Company, And, Accordingly, May Have Conflicts Of Interest In Determining To Which Entity A Particular Business Opportunity Should Be Presented and Management Management Conflicts Of Interest. Additionally, we have not, nor has anyone on our behalf, taken any measure, directly or indirectly, to identify or locate any suitable acquisition candidate for the company, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. After the completion of this offering, we may enter into one or more forward purchase agreements, including potentially with affiliates of Jaguar and Hennessy Capital Group, to provide for financing of our initial business combination. Initial Business Combination So long as our securities are then listed on the Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account, if any) at the time of signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the board is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of net assets threshold, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, any proxy statement that we deliver to shareholders and file with the SEC in connection with a proposed transaction will include such opinion. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by TABLE OF CONTENTS the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on the Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net asset test. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. Other Considerations Jaguar manages multiple investment vehicles and is currently investing and will raise, market, organize, sponsor and/or act as general partner or manager or as the primary source for transactions for other funds, vehicles and/or accounts in the future (collectively the Funds ), including during the period in which we are seeking our initial business combination. Although we intend to seek a business combination with a company that would not be an appropriate opportunity for the Funds, the Funds (and/or their portfolio companies) may compete with us for acquisition opportunities. Hennessy Capital Group manages multiple SPACs and will raise, market, organize, sponsor and/or act as sponsor and / or manager or as the primary source for transactions for other SPACs, vehicles and/or accounts in the future (collectively the Hennessy SPACs ). However, we do not expect that this would adversely affect our ability to consummate our initial business combination because of the differing nature and geographies of the acquisition targets Jaguar and Hennessy Capital Group typically consider most attractive for the Funds, Hennessy SPACs and the types of acquisitions we expect to find most attractive for us. The Funds traditional private equity activities typically involve investing in private companies, and while the Funds will often take the companies public, they typically invest in those entities for a number of years prior to an initial public offering, not at the time of such offering. The Hennessy SPACs predominantly target U.S. based business combinations whereas we will predominantly focus on business combination opportunities based outside of the United States. In addition, the Funds from time to time are made aware of businesses that are high quality, but that do not fit the risk-adjusted return profile or time horizon of the Funds. As a result, we may become aware of a potential transaction that is not a fit for the traditional investment activities of the Funds but that is an attractive opportunity for us. Neither Jaguar nor Hennessy Capital Group will be seeking investment opportunities solely for us. In addition, certain of our partners, employees, officers and directors presently have, and any of them in the future will have additional, fiduciary, contractual and other duties to other entities, including without limitation, the Funds and certain companies in which Jaguar and/or Hennessy Capital Group or such entities have invested. As a result, if any of our partners, employees, officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he, she or it has then-current fiduciary, contractual or other obligations (including, without limitation, any Funds and their portfolio companies), then he, she or it will be required to honor such fiduciary, contractual or other obligations to present such business combination opportunity to such entity, subject to their fiduciary duties under Cayman Islands law, before we can pursue such opportunity. If the Funds or other entities decide to pursue any such opportunity, we would likely be precluded from pursuing the same until such time as such Funds or other entities have determined to no longer pursue such opportunity. If it is determined that such investment is appropriate for any of the Funds, such opportunity will be pursued by such Funds in accordance with the current policies and procedures of Jaguar and Hennessy Capital Group, as applicable, and such Funds TABLE OF CONTENTS governing agreements and generally not us. However, we do not expect these duties to materially affect our ability to complete our initial business combination, and believe some of this conflict will naturally be mitigated by the different nature of the acquisition targets for the Funds and the types of acquisitions expected to be attractive for the company. In addition, none of Jaguar, Hennessy Capital Group or any of our partners, employees, officers, directors, or consultants is required to commit any specified amount of time to our affairs (although they may have such commitments to the Funds and/or affiliated businesses), and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Moreover, Jaguar, Hennessy Capital Group and certain of our partners, employees, officers and directors, as well as certain of our consultants, have and will have in the future time and attention requirements for current and future Funds and other third parties. Jaguar, Hennessy Capital Group and our partners, employees, officers and directors, and, in certain cases, consultants, are also entitled to fees and incentive-based compensation (including carried interest) in respect of the Funds and thus may be incentivized to dedicate more time and attention to such Funds. To the extent any conflict of interest arises between, on the one hand, us and, on the other hand, the Funds, Jaguar and/or Hennessy Capital Group and their respective affiliates will resolve such conflicts of interest in their sole discretion in accordance with their then existing fiduciary, contractual and other duties (including fiduciary duties under Cayman Islands law) and there can be no assurance that such conflict of interest will be resolved in our favor. Jaguar and/or Hennessy Capital Group and our partners, employees, officers and directors, as well as in certain cases its consultants may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. In particular, (i) Thomas D. Hennessy, one of our directors, currently serves as a director of VII, a special purpose acquisition company that completed its initial public offering in December 2020, and as Chairman of the Board, Co-Chief Executive Officer and President of PTIC, (ii) M. Joseph Beck, one of our directors, currently serves as a director of VII and as Co-Chief Executive Officer, Chief Financial Officer and a director of PTIC, (iii) Christine Zhao, one of our independent director nominees, serves as the Chief Financial Officer and a director of Edoc Acquisition Corp., a special purpose acquisition company that completed its initial public offering in November 2020, and as a director of D and Z Media Acquisition Corp., a special purpose acquisition company that completed its initial public offering in January 2021, and (iv) Daniel J. Hennessy, one of our advisors and an affiliate of our sponsor, currently serves as a Senior Advisor to VII, a Senior Advisor to PTIC, and the Chairman and Chief Executive Officer of Hennessy Capital Investment Corp. V (NASDAQ: HCIC) and Hennessy Capital Investment Corp. VI (NASDAQ: HCVI). Each of VII, PTIC, Edoc Acquisition Corp., D and Z Media Acquisition Corp., Hennessy Capital Investment Corp. V and Hennessy Capital Investment Corp. VI, like us, may pursue initial business combination targets in any business or industry and is expected to have a similar window as us in which it may complete its initial business combination. Any such companies, business or investments may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates. However, we do not currently expect that any such other blank check company would materially affect our ability to complete our initial business combination. Corporate Information Our executive offices are located at 3225 Franklin Avenue, Suite 309, Miami, Florida 33133, and our telephone number is (312) 656-1035. We maintain a corporate website at www.jaguarglobalgrowth.com. The information contained on or accessible through our corporate website or any other website that we may maintain is not part of this prospectus or the registration statement of which this prospectus is a part. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied TABLE OF CONTENTS on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements, and, if their revenues are less than $100 million, not providing an independent registered public accounting firm attestation on internal control over financial reporting. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30. TABLE OF CONTENTS
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+the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: "common stock" are to our Class A common stock and our Class B common stock, collectively, par value $0.0001 per share; "company" or "our company" "we," "us," "are to Prime Number Acquisition I Corporation; "DGCL" is to the Delaware General Corporation Law "equity-linked securities" are to any securities of our company which are convertible into or exchangeable or exercisable for, common stock of our company, including but not limited to a private placement of equity or debt. "founder shares" are to our Class B shares of our common stock initially purchased by our founders in the aggregated price of $25,000 in a private placement which were later converted by our founders into same amount of shares of Class A common stock prior to this offering; "founders "or "initial stockholders" are to holders of our founder shares prior to this offering and holders of our private shares upon the consummation of this offering which include our sponsors, officers and directors; and/or their designees; "management" or our "management team" are to our officers and directors; "private shares" are to the shares of our shares of Class A common stock to be issued to our sponsors in a private placement simultaneously with the closing of this offering; "public shares" are to shares of our common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "public stockholders" are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a "public stockholder" shall only exist with respect to such public shares; "rights" are to rights sold as part of the units in this offering, each to receive one-eighth of one share of Class A common stock upon the consummation of an initial business combination; "sponsor A" is to Prime Number Acquisition LLC, a Delaware limited liability company, managed by Dongfeng Wang; "sponsor B" is to Glorious Capital LLC, a Delaware limited liability company, managed by Benedicto S. Perez, who is one of the members of Sponsor B; "sponsors" are to Sponsor A and Sponsor B; "warrants" are to our warrants sold as part of the units in this offering; and "working capital shares" are to shares of Class A common stock issuable upon conversion of working capital loans, if any, at $10.00 per share, upon the consummation of the business combination. 1 Registered trademarks referred to in this prospectus are the property of their respective owners. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment units. PROPOSED BUSINESS Our Company We are a newly organized blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. Our efforts to identify a target business will likely span many industries and regions around the world. Our efforts are not limited to a particular industry, although we intend to focus our search in the technology-enable financial sectors or related industries. We are also not limited to geographic region for purposes of consummating an initial business combination, but we will not undertake our initial business combination with any entity being based in or having the majority of the company s operations in China (including Hong Kong and Macau). A majority of our management including officers and directors are located outside of China and we expect them to travel and conduct business outside of China during our search for target companies as needed. We have not selected any potential business combination target or initiated any substantive discussions, directly or indirectly, with any potential business combination prospects. While we intend to undertake a search process, our ability to locate a potential target is subject to the uncertainties discussed elsewhere in this prospectus. Our Founders and Management Two of our founders are our sponsors, Prime Number Acquisition LLC and Glorious Capital LLC, both are Delaware limited liability companies. The other founders are officers and directors of the Company. None of our founders or us is affiliated with Prime Number Capital LLC, one of the representatives of the underwriter of this offering. Our management led by our Chief Executive Officer and Chairman, Mr. Dongfeng Wang, have decades of experience combined in the technology sectors, with broad investment expertise in areas ranging from blockchain, digital currency, big data, artificial intelligence to machine learning, all of which have broad and critical application in the financial service sectors. In addition, some of our directors also have intimate knowledge of the financial service sectors, serving in various investment, advisory, management or operational functions in real estate, e-commerce, consumer finance, and commercial banking businesses. With a combination of experience in both technology and financial services sectors, our directors and officers are uniquely positioned in sourcing, structuring, and consummating target businesses in the technology-enabled financial industries. Mr. Dongfeng Wang, our Chief Executive Officer and Chairman, has over 20 years of experience in the Internet industry covering growth phases of Internet from PC basis, mobile basis to emerging blockchain basis. In addition, Mr. Wang has more than a decade of first-hand entrepreneurship in the online music, online magazine, online game distribution, blockchain investment, and digital currency mining industries. In 2013, Mr. Wang joined Young CEO Club, a free entrepreneurship coaching program created by Xiamen Longling Capital Assets Management Co., Ltd. ("Longling Capital"), Innovation Works Holdings Limited and Beijing Zhenge Tiancheng Investment Management Company LTD, to share industry knowledge and experience with and advise Chinese emerging start-ups. In 2011, Mr. Wang joined Longling Capital founded by Mr. Wensheng Cai as a founding partner, which later invested in many well-known Chinese internet companies including 58.com Inc., Zhihu Inc., Meitu Inc., Feiyu Technology International Company Ltd., and Baofeng Group Co., Ltd. In 2009, Mr. Wang co-founded Forgame Group (00484.HK) ("Forgame"), entering the field of online game research and development and distribution. Mr. Wang served as the CEO and Chairman of the Board of Forgame from September 2009 to September 2019. Under his leadership, Group was successfully listed on Hong Kong Stock Exchange in October 2013. Prior to that, Mr. Wang and Mr. Wensheng Cai jointly invested in eMule VeryCD, FlashGet, 4399 Games, Meitu and other enterprises in 2006. In 2004, Mr. Wang founded Beijing Zhi Tong Wu Xian Technology Co., Ltd., or Zcom, an electronic magazine platform in China, and served as the CEO of the company from January 2005 to October 2008. From April 2000 to August 2004, Mr. Wang served as a director of Beijing Flying Network Music Software Research and Development Co. Ltd., a digital music distribution company. Mr. Wang received his Bachelor s degree from Beijing Construction University, majoring in international trade and global economics, in 1999. 2 Mr. David Friedman, is our Chief Financial Officer and will serve as a director upon the effectiveness of this prospectus. Mr. Friedman has over 20 years of experience in strategic management, high technology and artificial intelligence. Since May 2020, he has served as a director of Venti Technologies, a developer of autonomous mobility vehicles designed to improve lives through disrupted transportation, commerce and society. Since August 2019, Mr. Friedman has served as an advisor and coach for ALICE Technologies, a developer of an artificial intelligence platform intended for modern AI and optimization techniques. Since June 2019, Mr. Friedman has served as the CFO of Oyla Inc., a developer of optical sensors designed to permit intelligent machines to perceive and navigate the three-dimensional world around them. Between July 2018 and November 2021, he served as the Executive Chairman of the board of the directors of Ayla Networks, where he served as the CEO from September 2010 to July 2018, a provider of a cloud platform-as-a-service connectivity platform designed to provide the flexibility and modularity to enable rapid changes to practically any type of device, cloud or app environment. Before that, Mr. Friedman served as a Vice President in Business Development & Senior Director of Strategic Marketing Group of ZeroG Wireless from February 2006 to January 2020, a developer of wireless solutions for connecting devices to the Internet. From February 2000 to January 2006, Mr. Friedman served as a strategic account manager of Matrix Semiconductor, a developer of three-dimensional integrated circuits, responsible for all direct/indirect European sales. From May 1997 to February 2000, Mr. Friedman served as a marketing manager of microprocessor pricing group of Intel, one of the world s largest chipmakers designing and manufacturing microprocessors for the global personal computers and data center markets. From January 1993 to July 1995, Mr. Friedman served as a mergers & acquisition analyst at the Chase Bank. Mr. Friedman earned his MBA degree from University of Michigan in 1997 and his Bachelor s degree in history from Colgate University in 1990. Ms. Qinyu Wang will serve as an independent director upon the effectiveness of this prospectus. Ms. Wang has over 20 years of experience in e-commence and risk management. From February 2017 to present, Ms. Wang serves as a strategic consultant of Zhejiang Yi Gao Cultural & Creative Go. Ltd, providing strategic consultation to executives. From January 2016 to January 2017, Ms. Wang served as a Co-Founder of Hangzhou TaoData Co., Ltd., a provider of data analytics services using automated machine learning engines that performs analysis, model deployment and model updating. From October 2010 to December 2015, Ms. Wang served as a senior director of Alibaba Group, one of the largest retailers and e-commerce companies globally. From February 2006 to September 2008, Ms. Wang served as a Vice President of HSBC, one of the largest banks in the world with 40 million customers worldwide. Ms. Wang served as a Vice President of JP Morgan Chase between September 2000 and February 2006, involving in risk and information management. Ms. Wang earned her PhD. degree in Engineering from University of Pittsburgh and her Bachelor s degree in Engineering from Tsinghua University. Mr. David Sherman will serve as an independent director upon the effectiveness of this prospectus. Mr. Sherman is a professor who has over 30 years of academic and professional experience in accounting and auditing. Mr. Sherman has been a professor at Northeastern University since 1984, specializing in, among other areas, financial and management accounting, global financial statement analysis and contemporary accounting issues. Mr. Sherman has served as Trustee and Chair of Finance Committee for American Academy of Dramatic Arts, the oldest English language acting school in the world, since January 2014, and as Board member and Treasurer for D-Tree International, a non-profit organization that develops and supports electronic clinical protocols to enable health care workers worldwide to deliver high quality care since July 2010. From 2020 to present, Mr. Sherman serves as a director and audit committee chair of China Liberal Education Holdings Limited, an educational service provider operating in China. From 2020 to present, Mr. Sherman serves as Board and Audit Committee Chair of Skillful Craftsman Education Technology Limited, a provider of online education and technology services in China. From 2020 to present, Mr. Sherman serves as Director Nominee of Car House Holding Co. Ltd, a provider and operator of an e-commerce platform with direct supply channels for automobiles. From 2019 to present, Mr. Sherman serves as a director and a member of Audit Committee of NUVVE Holdings Corp. (Nasdaq: NVVE), previously known as Newborn Acquisition Corporation (Nasdaq: NBAC), a blank check company until March 2021 when it consummated its business combination. From January 2012 to November 2014, Mr. Sherman served as the Chair of the Audit Committee and Compensation Committee of Agfeed Corporation (OTC: FEED), a hog production business. From February 2011 to May 2016, Mr. Sherman served as the Chair of the Audit Committee of Kingold Jewelry Inc. (Nasdaq: KGJI), a manufacturer of 24K gold jewelry in Wuhan, China. Mr. Sherman was previously on the faculty of the Sloan School of Management at Massachusetts Institute of Technology (MIT) from 1980 to 1995 and also, among other academic appointments, held an adjunct professorship at Tufts Medical School and was a visiting professor at Harvard Business School (2015). From 2004 to 2005, Professor Sherman was an Academic Fellow at the U.S. Securities and Exchange Commission in the Division of Corporate Finance s Office of Chief Accountant. Mr. Sherman earned his Doctorate Degree in Accounting and Accountability Systems from Harvard Business School in 1981. Mr. Sherman earned his Master s Degree in Business Administration and Control of Finance from Harvard Business School in 1971 and his Bachelor s degree in Economics from Brandeis University in 1969. He was Cum Laude with Honors in Economics. Mr. Sherman is a CPA certificate holder. Mr. Chris Dunn will serve as an independent director upon the effectiveness of this prospectus. Mr. Dunn is a partner of Mission Peak Capital, where he is responsible for managing real estate investments. Prior to that, Mr. Dunn served as a managing director of Commercial Real Estate Group at Deutsche Bank between 2001 and 2012, where he managed a group of bankers in sourcing, pricing, structuring, and closing of performing and distressed commercial real estate loans. From 2000 to 2001, he worked as a principal in the real estate finance division at Band of America Securities LLC. Mr. Dunn also served as a director of Structured Finance – Commercial Real Estate Division at Standard & Poor s between 1997 and 2000. Mr. Dunn received his Bachelor s degree in Business Administration from Boston University. We believe that with their experience in operating public and private entities and skillsets in sourcing, investing, and value-enhancement at the intersections of technology and financial services, we are well positioned in pursuing opportunities in the technology-enable financial industries that will offer risk-adjusted returns. 3 Our Strength We are uniquely positioned to capitalize on the strength brought to the table by our directors and officers, including: Track Record in Technology Industry. A majority of our team, including but not limited to Mr. Dongfeng Wang and Mr. David Freidman, have deep exposure to the technology industries, serving in various roles for technology companies in different stages of their lifecycles from start-ups to established public companies. Some directors and officers have served as founders, investors, board directors, operation managers, marketing directors, financial advisors, and other roles in technology companies, with in-depth knowledge of the unique challenges and opportunities of investing, managing and operating technology companies across different spaces ranging from artificial intelligence to blockchain. With their established records, our directors and officers have developed unique perception in identifying growth opportunities in underutilized technologies and undervalued markets. Understanding and Appreciation of Financial Industry Application. On the one hand, some of our directors and officers, such as Ms. Qinyu Wang and Mr. Chris Dunn, played significant roles in commercial banking, e-commerce, real estate and other financial services institutions, paving their way to emerge as investors, directors and executives. On other hand, one of our directors, Mr. David Sherman, brings a wealth of academic and research knowledge on the financial services sector to our team as a leading scholar in data-driven performance analytics and financial reporting. Applying their operational and research experience as a backdrop, our directors and officers have achieved deep understanding and appreciation of the impact of disruptive technologies in reshaping financial services, including how technologies expand product offerings, expedite transactional processes, and exhilarate service innovations. Established Thesis and Analytical Framework. In addition to their industrial experience and expertise, our directors and officers have established a set of analytical indicators, processes, and frameworks to identify potential acquisition targets. Our decisions will be informed by frequent internal analysis and discussions and input and validation from industry experts and thought leaders. Proprietary Channels, Networks and Relationships. With decades of sourcing, structuring, and consummating business transactions across the world, our directors and officers can capitalize on their proprietary relationships, networks and channels to develop a pipeline of acquisition targets and opportunities. These connections, in combination with their strong sourcing capabilities and strong analytical frameworks, will facilitate the process of identifying and engaging potential targets. Business Strategy and Acquisition Criteria Our business strategy is to identify and acquire potential targets in which we believe can materially grow revenue and earnings through the efforts of a combined management team followed by the completion of a business combination, but we will not undertake our initial business combination with an entity being based in or having the majority of the company s operations in China (including Hong Kong and Macau). We expect to leverage our management team s extensive relationships and networks with corporate executives, venture capitalists, entrepreneurs, and private equity firms, particularly in technology-enable financial industries, to screen potential targets with time efficiency and prudence. We believe we will benefit from their accomplishments, and specifically their current and previous activities in the technology and financial industries, in identifying attractive acquisition opportunities. We are not limited to a particular geographic region for purposes of consummating an initial business combination except that we will not undertake our initial business combination with any target being based in or having the majority of the company s operations in China (including Hong Kong and Macau). In consistent with our business strategies and objectives, we have identified the following general criteria and guidelines. While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines should we see justifications to do so. Leading Industry Position. We intend to acquire a business that we believe demonstrates attractive long-term growth prospects and an ability to lead or consolidate the industry. Competitive Advantage. We intend to acquire a business that is poised for high growth due to disruptive technology, superior product offerings, and/or shifting customer preferences. Stable Cash Flows. We will consider businesses with the potential to generate stable and increasing free cash flows. We may also seek to prudently leverage the cash flows to enhance stockholder value. Growth Potential. We will be looking for businesses that we believe present the potential for revenue and earnings growth through a combination of business, management, and resources. Strong Management Team. We will seek to acquire a business with reasoned and strong management that has a proven track record of driving growth and profitability. Benefit from being a public company. We intend to acquire a business that will benefit from being publicly traded through access to a broader source of capital and a public profile. This list of criteria and guidelines is not intended to be exhaustive. Our management team will evaluate and value potential companies on a case-by-case basis. Any evaluation relating to the merits of a particular initial business combination or acquisition may be based, to the extent relevant, on these general guidelines as well as other considerations, factors, and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination or acquisition with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guideline in our stockholder communications, which as discussed in this prospectus would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Permission Required from the Chinese Authorities for this Offering and a Business Combination As a Delaware corporation with no operations in China, we are not required to obtain permission from any Chinese authorities to operate or to issue the securities being issued in this offering to any investors, including Chinese investors, if any and we do not expect that permission will be required from the Chinese authorities in connection our business combination since we will not undertake our initial business combination with any entity being based in or having the majority of the company s operations in China (including Hong Kong and Macau). Initial Business Combination Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding deferred underwriting commissions payable to our underwriters and taxes payable) at the time of our signing a definitive agreement in connection with the initial business combination, but we will not undertake our initial business combination with an entity being based in or having the majority of the company s operations in China (including Hong Kong and Macau). If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority ("FINRA"), or an independent valuation or accounting firm with respect to the satisfaction of such criteria. Our stockholders may not be provided with a copy of such opinion, nor will they be able to rely on such opinion. 4 The net proceeds of this offering and the sale of the private shares released to us from the trust account upon the closing of our initial business combination may be used as consideration to pay the sellers of a target business with which we complete our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. In addition, we may be required to obtain additional financing in connection with the closing of our initial business combination to be used following the closing for general corporate purposes as described above. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise. None of our founders is required to provide any financing to us in connection with or after our initial business combination, except that our sponsor A has committed to transfer up to 465,000 founder shares to financial advisors, finders or consultants in our business combination who are not affiliated with us, our sponsors, officers or directors. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. Our amended and restated certificate of incorporation will provide that, following this offering and prior to the consummation of our initial business combination, we will be prohibited from issuing additional securities that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on any initial business combination or (b) to approve an amendment to our amended and restated certificate of incorporation to (x) extend the time we have to consummate a business combination beyond 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (y) amend the foregoing provisions, unless (in connection with any such amendment to our amended and restated certificate of incorporation) we offer our public stockholders the opportunity to redeem their public shares. Our Acquisition Process We will utilize the diligence, rigor, and expertise of our managements respective platforms to evaluate potential targets strengths, weaknesses, and opportunities to identify the relative risk and return profile of any potential target for our initial business combination. We currently do not have any specific business combination under consideration. Our officers and directors have not individually selected a target business. Our management team is continuously made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) had any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities including other special purpose acquisition company, or SPAC pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. Specifically, for example, certain members of our management team have fiduciary and contractual duties to other entities in technology investment. Though, to our knowledge, those entities focus on early-staging private companies while we may pursue opportunities suitable for listing post-combination, there is possibility that they may compete with us for business combination. If such entities decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. Subject to his or her fiduciary duties under Delaware law, none of the members of our management team who are also employed by, or directors of, our sponsors or its affiliates have any obligation to present us with any opportunity for a potential business combination of which they become aware. Our management team, in their capacities as directors, officers or employees of our sponsor or its affiliates or in their other endeavors, may choose to present potential business combinations to the related entities described above, current or future entities affiliated with or managed by our sponsor, or third parties, before they present such opportunities to us, subject to his or her fiduciary duties under Delaware law and any other applicable fiduciary duties.For more details about the existing fiduciary duties or contractual obligations of our executive officers, directors and director nominees, see "Management-- Conflicts of Interest" on page 105 . 5 Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. Our officers may become an officer or director of any other special purpose acquisition company with a class of securities registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, even before we enter into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) after the closing of this offering. Private Placement On April 7, 2021, our sponsor A, or Prime Number Acquisition LLC, acquired 1,357,000 shares of Class B common stock, and our sponsor B, or Glorious Capital LLC, acquired 80,500 shares of Class B common stock. On May 28, 2021, our sponsor A and sponsor B surrendered 271,400 and 16,100 shares of Class B common stock founder shares, respectively, without any consideration. On December 22, 2021, we effected a 1.5 for 1 stock split of our Class B common stock so that our sponsors owned an aggregate of 1,725,000 shares of Class B common stock. On December 28, 2021, our sponsors converted their shares of Class B common stock into 1,725,000 shares of Class A common stock on a one-for-one basis (up to 225,000 shares of which are subject to forfeiture depending on the extent to which the underwriter s over-allotment option is exercised). As a result, sponsor A acquired 1,628,400 shares of Class A common stock for an aggregate purchase price of $23,600 and sponsor B acquired 96,600 shares of Class A common stock for an aggregate purchase price of $1,400, or collectively the "founder shares." These founder shares include an aggregate of up to 225,000 founder shares that are subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that founder shares will represent 20% of the issued and outstanding shares of our common stock upon the consummation of this offering (excluding the sale of the private shares and assuming our founders do not purchase public shares in this offering). Our sponsor A has agreed to transfer an aggregated amount of 138,500 founder shares at their original purchase price to each of our officers and directors, our secretary, Ms. Sarah Gu, and a member of our sponsor A, Mr. Kris Yang, or their designees immediately prior to the closing of the offering and reserve up to 465,000 founder shares to be transferred to financial advisors, finders and consultants in connection with our business combination who are not affiliated with us, our sponsors, officers or directors. Thus, they may have a conflict of interest with respect to, identifying, recommending, evaluating a business combination and financing arrangements because of the potential transfer and the impact on their economic interest. None of our founders has indicated any intention to purchase public shares in this offering. In addition, our sponsors have committed to purchase from us an aggregate of 380,892 shares of Class A common stock (including 331,032 shares to be purchased by Sponsor A and 49,860 shares to be purchased by sponsor B), or "private shares," (or up to 416,892 private shares if our underwriters exercise the over-allotment option, including up to 367,032 shares to be purchased by Sponsor A and 49,860 shares to be purchased by sponsor B) at $10.00 per share for a total purchase price of $3,808,920 (or up to $4,168,920 if our underwriters exercise the over-allotment option). The private shares are identical to the Class A common stock sold as part of the units in this offering, or the "public shares". However, our founders have agreed (A) to vote their founder shares and private shares in favor of any proposed business combination, (B) not to propose, or vote in favor of, prior to and unrelated to an initial business combination, an amendment to our certificate of incorporation that would affect the substance or timing of our redemption obligation to redeem all public shares if we cannot complete an initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) of the closing of this offering, unless we provide public stockholders an opportunity to redeem their public shares in conjunction with any such amendment, (C) not to redeem any shares, including founder shares and private shares into the right to receive cash from the trust account in connection with a stockholder vote to approve our proposed initial business combination or sell any shares to us in any tender offer in connection with our proposed initial business combination, and (D) that the founder shares and private shares shall not participate in any liquidating distribution upon winding up if a business combination is not consummated. Our founders have agreed, subject to certain exception, (i) in the case of founder shares, not to transfer, assign or sell 50% of their founder shares until the earlier to occur of: (A) six months after the date of the consummation of our initial business combination, or (B) the date on which the closing price of our Class A common stock equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after our initial business combination and the remaining 50% of the founder shares may not be transferred, assigned or sold until six months after the date of the consummation of our initial business combination, or earlier, in either case, if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their shares for cash, securities or other property, and (ii) in the case of private shares and working capital shares issuable upon conversion of working capital loans, if any, until 30 days after the consummation our initial business combination (except as described herein under the section of this prospectus entitled "Principal Stockholders — Restrictions on Transfers of Founder Shares and Private shares"). We refer to such transfer restrictions throughout this prospectus as the lock-up. 6 The proceeds from the private placement of the private shares will be added to the proceeds of this offering and placed in a trust account in the United States maintained by Wilmington Trust, National Association, as trustee. If we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination), the proceeds from the sale of the private shares will be included in the liquidating distribution to the holders of our public shares. Corporate Information Our executive offices are 1129 Northern Blvd., Suite 404, Manhasset, NY, 11030, and our telephone number is (347) 329-1575. We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to "emerging growth company" shall have the meaning associated with it in the JOBS Act. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stocks held by non-affiliates exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stocks held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible. 7 The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team and advisors, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section of this prospectus entitled "Risk Factors." Securities offered 6,000,000 units, at $10.00 per unit (or 6,900,000 units if the underwriters option to purchase additional units is exercised in full), each unit consisting of: one share of Class A common stock; one-half of one redeemable warrant; and one right. Proposed NASDAQ symbols Units: "PNACU" Class A Common Stock: "PNAC" Warrants: "PNACW" Rights: "PNACR" Trading commencement and separation of Class A common stock, warrants, and rights The units will begin trading on or promptly after the date of this prospectus. The Class A common stock, warrants, and rights comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless the representatives inform us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock, warrants, and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock, warrants, and rights. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Each right entitles the holder to receive one-eighth (1/8) of one share of Class A common stock upon the closing of the initial business combination. No fractional shares will be issued. As a result, you must hold rights in multiples of eight (8) in order to receive shares of Class A common stock for all of your rights upon closing of a business combination. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of Class A common stock, warrants, and rights is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock, warrants, and rights be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 8 Units: Number outstanding before this offering 0 Number outstanding after this offering and private placement 6,000,000(1)(2) Common stock: Number outstanding before this offering 1,725,000 shares of Class A common stock(3)(6) Number outstanding after this offering and private placement 7,880,892 shares of Class A common stock (1)(4)(6) Warrants: Number outstanding before this offering 0 Number outstanding after this offering and private placement 3,000,000(1)(5) Exercisability Each whole warrant is exercisable to purchase one share of our Class A common stock and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Therefore, you must separate units in multiples of two in order to receive a whole warrant. Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our founders or their affiliates, without taking into account any founder shares held by our founders or such affiliates, as applicable, prior to such issuance) (the "Newly Issued Price"), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the "Market Value") is below $9.20 per share, then the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the greater of the Market Value and the Newly Issued Price, and the $16.50 per share redemption trigger price described below under "Redemption of warrants" will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price. (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our founders of 225,000 founder shares. (2) Includes 6,000,000 units and 380,892 private shares. (3) Includes up to 225,000 shares of Class A common stock that are subject to forfeiture by our founders depending on the extent to which the underwriters over-allotment option is exercised. 9 (4) Includes 1,500,000 founder shares, 6,000,000 shares of Class A common stock included in the units and 380,892 private shares. (5) Includes 3,000,000 warrants included in the units and 6,000,000 rights included in the units. (6) The shares of common stock included in the units are Class A common stock. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, or 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are not registering the shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 30 business days1 after the closing of our initial business combination, we will use our reasonable best efforts to file, and within 60 business days following our initial business combination to have declared effective, a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants, to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed; provided, that if our Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a "covered security" under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of warrants who exercise their warrants to do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will be required to use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; 10 at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our Class A common stock equals or exceeds $16.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. We will use our best efforts to register or qualify such shares of Class A common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. Please see the section of this prospectus entitled "Description of Securities — Warrants" for additional information. Rights Number outstanding before this offering 0 Number outstanding after this offering and private placement 6,000,000 (1)(5) Terms of Rights Each right is entitled to automatically receive one-eighth (1/8) of one share of Class A common stock upon consummation of our initial business combination. In the event we will not be the surviving company upon completion of our initial business combination, each holder of a right will automatically receive the kind and amount of securities or properties of the surviving entity as the holders of each one-eigth (1/8) of one share of Class A common stock is entitled to upon the consummation of such transaction. We will not issue fractional shares in connection with an exchange of rights. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable provisions of the DGCL. Therefore, you must hold rights in multiples of eight (8) in order to receive whole shares of Class A common stock for all of your rights upon closing of a business combination. If we are unable to complete an initial business combination within the required time period and we redeem the public shares for the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless. Rights holders are not eligible to vote on or redeem in our initial business combination. Founder shares On April 7, 2021, our sponsor A acquired 1,357,000 shares of Class B common stock, and our sponsor B acquired 80,500 shares of Class B common stock. On May 28, 2021, our sponsor A and sponsor B surrendered 271,400 and 16,100 shares of Class B common stock without consideration, respectively. On December 22, 2021, we effected a 1.5 for 1 stock split of our Class B common stock so that our sponsors owned an aggregate of 1,725,000 shares of Class B common stock. On December 28, 2021, our sponsors converted their shares of Class B common stock into 1,725,000 shares of Class A common stock on a one-for-one basis (up to 225,000 shares of which are subject to forfeiture depending on the extent to which the underwriter s over-allotment option is exercised). As a result, sponsor A acquired 1,628,400 shares of Class A common stock for an aggregate purchase price of $23,600 and sponsor B acquired 96,600 shares of Class A common stock for an aggregate purchase price of $1,400, collectively, the "founder shares". In addition, our sponsor A has committed to transfer an aggregated amount of 138,500 founder shares to our officers, directors, secretary and a member of sponsor A or their designees immediately prior to the consummation of this offering at the original purchase price and reserve up to 465,000 founder shares to be transferred to financial advisors, finders or consultants in connection with our business combination who are not affiliated with us, our sponsors, officers or directors. Prior to the initial investments in the company by our sponsors, the company had no assets, tangible or intangible. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued. These founder shares include an aggregate of up to 225,000 founder shares that are subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that founder shares will represent 20% of our shares issued and outstanding immediately following this offering (excluding the sale of the private shares and assuming our founders do not purchase public shares in this offering). 11 The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; the founder shares are subject to registration rights; our founders have agreed to vote any founder shares and private shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to their founder shares and private shares, we would need 2,059,555, or 34.33 %, of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); and our founders have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to any founder shares, private shares and any public shares held by them in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to their founder shares, private shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares and private shares held by them if we fail to complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering, although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame. If we submit our initial business combination to our stockholders for a vote, we will complete our initial business combination only if a majority of the outstanding shares of Class A common stock voted are voted in favor of the initial business combination. 12 Transfer restrictions on founder shares Our founders have agreed not to transfer, assign or sell 50% of their founder shares until the earlier to occur of: (A) six months after the date of the consummation of our initial business combination, or (B) the date on which the closing price of our Class A common stock equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after our initial business combination and the remaining 50% of the founder shares may not be transferred, assigned or sold until six months after the date of the consummation of our initial business combination, or earlier, in either case, if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled "Principal Stockholders — Restrictions on Transfers of Founder Shares and Private shares"). We refer to such transfer restrictions on founder shares, private shares and working capital shares issuable upon the conversion of certain working capital loans throughout this prospectus as the lock-up. Private shares Our sponsors have committed, pursuant to a written agreement, to purchase an aggregate of 380,892 (or 416,892 if the over-allotment option is exercised in full) shares of Class A common stock, at $10.00 per share (approximately $3,808,920 in the aggregate or approximately $4,168,920 in the aggregate if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. The private shares are identical to the shares of Class A common stock sold as part of the units in this offering, subject to limited exceptions. The purchase price of the private shares will be added to the net proceeds from this offering to be held in the trust account. If we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering, the proceeds of the sale of the private shares held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private shares will be worthless. A portion of the purchase price of the private shares will be added to the proceeds from this offering to be held in the trust account such that at the time of closing. $61,200,000, or $10.20 per unit (or $70,380,000, or $10.20 per unit if the underwriters exercise their over-allotment option in full) will be held in the trust account. If we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering, the proceeds from the sale of the private shares held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private shares will expire worthless. Transfer restrictions on private shares The private shares will not be transferable, assignable or salable until 30 days after the completion of our initial business combination (except as described under the section of this prospectus entitled "Principal Stockholders — Restrictions on Transfers of Founder Shares and Private shares"). 13 Proceeds to be held in trust account The rules of NASDAQ provide that at least 90% of the gross proceeds from this offering and the sale of the private shares be deposited in a trust account. Of the proceeds we receive from this offering and the sale of the private shares described in this prospectus, $61,200,000 or $10.20 per unit ($70,380,000, or $10.20 per unit if the underwriters over-allotment option is exercised in full will be deposited into a U.S.-based trust account with Wilmington Trust, National Association, acting as trustee, and $708,920 will be available to pay fees and expenses in connection with the closing of this offering (excluding underwriting discounts or commissions) and $700,000 will be available for working capital following this offering. These proceeds include $2,100,000 (or $2,415,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our tax obligations, the proceeds from this offering and the sale of the private shares that are deposited in the trust account will not be released from the trust account until the earliest of (a) the completion of our initial business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (ii) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (c) the redemption of our public shares if we are unable to complete our business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon an assumed interest rate of 0.05%, we expect the trust account to generate approximately $20,000 of interest annually. 14 Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private shares not held in the trust account, which will be approximately $700,000 in working capital after the payment of approximately $$708,920in expenses (excluding underwriting commissions) relating to this offering; and any loans or additional investments from our founders or their affiliates, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of our assets held in the trust account (excluding deferred underwriting commissions and interest income earned on the trust account that is released for working capital purposes or to pay taxes) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses or we are considering an initial business combination with an affiliated entity, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons. However, we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires an interest in the target sufficient for the post-transaction company not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. 15 Permitted purchases of public shares by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our founders or their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our founders or their affiliates may purchase in such transactions, subject to compliance with applicable law and the rules of NASDAQ. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended, or the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants and rights. Our founders have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and private shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our business combination or otherwise and to waive their redemption rights with respect to their founder shares, private shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity. 16 Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and stock purchases would not typically require stockholder approval, while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. We intend to conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements or we choose to seek stockholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on NASDAQ, we will be required to comply with such rules. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our founders will terminate any plan established in accordance with Rule 10b5-1 under the Exchange Act to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event that we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. 17 If, however, stockholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain stockholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A under the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote at such meeting. Our founders will count towards this quorum and have agreed to vote their founder shares, private shares and any public shares purchased during or after this offering in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our founder shares and private shares, we would need 2,059,555, or 34.33%, of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our founders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether it votes for or against the proposed transaction. We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents mailed to such holders, or up to two business days prior to the vote on the proposal to approve the business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed business combination is not approved and we continue to search for a target company, we will promptly return any certificates delivered, or shares tendered electronically, by public stockholders who elected to redeem their shares. 18 Our amended and restated certificate of incorporation will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our business combination. 19 Redemption rights in connection with proposed amendments to our certificate of incorporation Some other blank check companies have a provision in their charter which prohibits the amendment of certain charter provisions. Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement of shares into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law, or DGCL, or applicable stock exchange rules. We may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation or in our initial business combination or that would entitle holders to receive funds from the trust account. Our founders, who will collectively beneficially own 23.87% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our founders have agreed, pursuant to a letter agreement with us (filed as an exhibit to the registration statement of which this prospectus forms a part), that they will not propose any amendment to our amended and restated certificate of incorporation (i) that would modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (ii) with respect to any other material provision relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable and amounts released to us for working capital purposes) divided by the number of then outstanding public shares. Our founders have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares, private shares and any public shares held by them in connection with the completion of our initial business combination and to waive their redemption rights with respect to their founder shares, private shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity. 20 Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us. We will use these funds to pay amounts due to any public stockholders who exercise their redemption rights as described above under "Redemption rights for public stockholders upon completion of our initial business combination," to pay the deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt instruments, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other assets, companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation provides that we will have only 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering to complete our initial business combination. If we are unable to complete our initial business combination within such time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us for working capital purposes or to pay our taxes (less up to $50,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants and rights, which will expire worthless if we fail to complete our business combination within the 18-month time period. Our founders have waived their rights to liquidating distributions from the trust account with respect to any founder shares or private shares held by them if we fail to complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering. However, if our founders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted time period. 21 The underwriters have agreed to waive their rights to their deferred underwriting commissions held in the trust account in the event we do not complete our initial business combination and subsequently liquidate and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Limited payments to insiders Except the deferred underwriting commissions that we have agreed to pay the underwriters in connection with our business combination and potential transfer of up to 465,000 founder shares from sponsor A to financial advisors, finders and consultants in connection with our business combination who are not affiliated with us, our sponsors, directors or officers, there will be no finder s fees, reimbursements or cash payments made to our founders or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination although we may consider cash or other compensation to officers or advisors we may hire subsequent to this offering to be paid either prior to or in connection with our initial business combination. In addition, the following payments will be made to our founders or their affiliates, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination: Repayment of an aggregate of up to $400,000 in loans made to us by our sponsor A; Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; A monthly fee of an aggregate of $10,000 for office space, administrative and shared personnel support services to sponsor A. This arrangement will terminate upon the earlier of (a) completion of a business combination or (b) twelve months after the completion of this offering; and Repayment of loans which may be made by our founders or an affiliate of our founders to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Additionally, if we extend the time available to us to complete our initial business combination, our sponsor, its affiliates or designee will deposit $600,000, or $690,000 if the over-allotment is exercised in full, for each three-month extension. Up to $3,000,000 of such working capital loans and extension loans may be convertible into shares of Class A common stock, or working capital shares, at a price of $10.00 per share at the option of the lender. The working capital shares would be identical to the private shares sold in the private placement. Our audit committee will review on a quarterly basis all payments that were made to our founders or their affiliates. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled "Management — Committees of the Board of Directors — Audit Committee." 22 Conflicts of Interest Although we do not believe any conflict currently exists between us and our founders or their affiliates, our founders or their affiliates may compete with us for acquisition opportunities. If such entities decide to pursue an opportunity, we may be precluded from procuring such opportunity. None of our founders or their respective affiliates will have any obligation to present us with any opportunity for a potential business combination of which they become aware, unless presented to such member specifically in his or her capacity as an officer or director of the Company. Our management team, in their capacities as employees or affiliates of our founders or in their other endeavors, may be required to present potential business combinations to future founders affiliates or third parties, before they present such opportunities to us. Our officers may become an officer or director of any other special purpose acquisition company with a class of securities registered under the Exchange Act, even before we enter into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination within 12 months (or up to 18 months if we extend the period of time to consummate a business combination) after the closing of this offering. In addition, our sponsor A has committed to transfer an aggregated amount of 138,500 founder shares to our officers, directors, secretary and a member of sponsor A or their designees immediately prior to the consummation of this offering at the original purchase price and reserve up to 465,000 founder shares to be transferred to financial advisors, finders or consultants in connection with our business combination who are not affiliated with us, our sponsors, officers or directors. Thus, they may have a conflict of interest with respect to, identifying, recommending, evaluating a business combination and financing arrangements because of the potential transfer and the impact on their economic interest. The Company has agreed, commencing on the effective date of the prospectus, to pay sponsor A the monthly fee of an aggregate of $10,000 for office space, administrative and shared personnel support services. This arrangement will terminate upon the earlier of (a) completion of a business combination or (b) twelve months after the completion of this offering. 23 Indemnity Our sponsors have agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or by a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.20 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, then our sponsors will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsors have sufficient funds to satisfy its indemnity obligations and believe that our sponsors only assets are securities of our company. We have not asked our sponsors to reserve for such indemnification obligations. None of our officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that we will adopt prior to the consummation of this offering; completion window are to the period following the completion of this offering at the end of which, if we have not completed our initial business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions and as further described herein. The completion window ends 18 months from the closing of this offering, which may be extended up to two times by an additional three months each time for a total of 24 months if our sponsor or its affiliate or designate deposits $0.10 per unit into the Trust Account in respect of each such 3-month extension (the Paid Extension Period ). In addition, we will be entitled to an automatic three-month extension (the Automatic Extension Period ) if we have filed a preliminary proxy statement, registration statement or similar filing for an initial business combination during the 18-month period or Paid Extension Period, to complete an initial business combination, as described in more detail in this prospectus. If we exercise both paid extension options and the automatic extension is triggered at the end of the Paid Extension Period, the completion window would end 27 months from the closing of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt; founder shares are to our Class B ordinary shares initially issued to our initial shareholders in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); Heritage are to Heritage Group, a diversified conglomerate with offices in Monaco; initial shareholders are to holders of our founder shares prior to this offering; Jean Boulle Group are to a group of companies founded by Jean-Raymond Boulle or in which Jean- Raymond Boulle is a material ultimate beneficial owner; management or our management team are to our officers and directors (including our director nominees that will become directors in connection with the consummation of this offering); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans or extension funding loans, if any; public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 15, 2022 PRELIMINARY PROSPECTUS Resources Acquisition Corp. $150,000,000 15,000,000 Units Resources Acquisition Corp is a blank check company incorporated as a Cayman Islands exempted company with limited liability for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an acquisition opportunity in any business, sector or geography, we intend to seek a target in the electrification transition and decarbonization value chains, with a primary focus on high-growth businesses engaged in the extraction and production of metals, minerals and chemicals that support this transition to a low carbon economy. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to 2,250,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. If we have not consummated an initial business combination within 18 months (or within up to 24 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus) from the closing of this offering, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. If we anticipate that we may not be able to consummate our initial business combination within 18 months from the consummation of this offering, we may, but are not obligated to, by resolution of our board of directors if requested by our sponsor, extend the period of time to consummate a business combination up to two times by an additional three months each time for a total of up to 24 months if our sponsor or its affiliate or designee deposits $0.10 per unit into the trust account in respect of each such 3-month extension (the Paid Extension Period ). In addition, we will be entitled to an automatic three-month extension (the Automatic Extension Period ) if we have filed a preliminary proxy statement, registration statement or similar filing for an initial business combination during the 18-month period or Paid Extension Period, to complete an initial business combination, as described in more detail in this prospectus. Public shareholders will not be offered the opportunity to vote on or redeem their shares at the end of the 18-month period or any initial Paid Extension Period if we choose to make any such paid extension or further paid extension,or in connection with an automatic extension, as applicable. Our sponsor, Boulle Heritage LLC, has agreed to purchase 10,600,000 warrants (or 11,612,500 warrants if the underwriters over- allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, at a price of $1.00 per warrant, in a private placement to occur concurrently with the closing of this offering. Our initial shareholders, including our sponsor, currently own 4,312,500 Class B ordinary shares, up to 562,500 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment of directors. Currently, there is no public market for our securities. We intend to apply to have our units listed on the New York Stock Exchange, or NYSE, under the symbol RAFU . We cannot guarantee that our securities will be approved for listing on the NYSE. We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on NYSE under the symbols RAF and RAFW, respectively, on the 52nd day following the date of this prospectus unless Citigroup Global Markets Inc. and BofA Securities, Inc. permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 37 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 150,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 8,250,000 Proceeds, before expenses, to us $ 9.45 $ 141,750,000 (1) Includes $0.35 per unit, or $5,250,000 in the aggregate (or $6,037,500 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See also Underwriting for a description of underwriting compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $153,750,000, or $176,812,500 if the underwriters over-allotment option is exercised in full ($10.25 per unit in either case), will be deposited into a U.S.-based trust account, with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Joint Bookrunners CitigroupBofA Securities The date of this prospectus is , 2022 TABLE OF CONTENTS public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public warrants are to our warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); sponsor are to Boulle Heritage LLC, a Cayman Islands limited liability company owned 42.5% by Heritage, 50% by Jean Boulle Group, 5% by Carlo Calabria and 2.5% by Cristina Levis; and we us our company the Company or our company are to Resources Acquisition Corp, a Cayman Islands exempted company with limited liability. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Our Company We are a blank check company newly incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. We have not selected any specific business combination target, and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. We have generated no operating revenues to date and we do not expect that we will generate operating revenues until we consummate our initial business combination. While we may pursue an acquisition opportunity in any business, sector or geography, we intend to seek a target in the electrification transition and decarbonization value chains, with a primary focus on high- growth businesses engaged in the extraction and production of metals, minerals and chemicals that support this transition to a low carbon economy, while remaining open to unique high-value industrial opportunities that demonstrate significant value potential to our shareholders. We believe that our management team s operational and management expertise as well as extensive global network of relationships will provide us with a competitive advantage in identifying and consummating an attractive transaction in these industries with the goal of pursuing long-term value creation for our shareholders. Our Board of Directors and Management Team Our strategy of identifying, acquiring and creating value from these value chains requires a unique and diverse set of skills that our management team possesses. Our competitive advantages include the significant experience of our management team in exploring, developing and constructing assets in the basic materials space; technical, operational, and financial expertise; as well as global relationships with participants, mid-stream customers, technology providers and critical public and private stakeholders. Marie Pierre Bertrand Boulle. Mr. Bertrand Boulle, our Chairman, is a senior natural resources executive and financial services professional. He is currently non-executive director of the publicly listed mining exploration company Diamond Fields Resources (TSX-DFR), non-executive director of publicly-listed Omnicane Limited, director of Investors Europe (Mauritius) Ltd. and CEO and director of Sun King Diamonds Ltd. Mr. Bertrand Boulle has over 15 years of in-country mining and diamond project administration experience with De Beers as well as other mining and oilfield services companies in the Democratic Republic of Congo, Angola, Guinea and Sierra Leone. He also has over 20 years of in- depth operational experience in compliance regulation within global financial markets spanning four regulated jurisdictions (UK, Gibraltar, Portugal, Mauritius). Mr. Bertrand Boulle has held senior posts and has been a regulated person for EU banks and financial institutions and worked for BNP Capital Markets (BNP Paribas) and BNC Corretora (now part of Santander Portugal). He also successfully launched two EU-based regulated stockbrokers for Portuguese institutions as well as his own low-risk stockbroker model in TABLE OF CONTENTS 2001. Mr. Bertrand Boulle is fluent in Portuguese, French and English and holds a BA Hons from the University of Ulster and an MBA from EU Business School. Martyn Buttenshaw. Mr. Buttenshaw, our Chief Executive Officer, has over 20 years of investment, natural resources and industrials experience as a senior executive. He is also an experienced non-executive director, currently serving as Chairman of Atacama Copper Corp. and as a director of Ranchero Gold Corp. Previously, Mr. Buttenshaw served as Operating Partner at Antarctica Capital where he was responsible for managing investments in the metals and minerals sector, with a particular focus upon the raw materials supply chain for the electric vehicle and renewable energy sectors. Prior to Antarctica, Mr. Buttenshaw was a Managing Director and spent ten years at Pala Investments, a metals and minerals focused private equity firm, responsible for deal origination, mergers and acquisition, strategy development, and project financing across a range of metals and mining related industry sectors and geographies. Mr. Buttenshaw has also held senior roles with Anglo American in business development and M&A and as a senior mining engineer with Rio Tinto. He is a Chartered Engineer and holds a Master s of Engineering (First Class) in Mining Engineering from Imperial College, London and an MBA (with distinction) from the London Business School. John van Eeghen. Mr. van Eeghen, our Chief Financial Officer, has over 18 years of experience working in finance and capital markets-related roles. This includes 15 years of experience working in the mining and energy space where he has been deeply involved in originating, structuring, and sourcing funding for opportunities, as well as creating innovative technology solutions to support the industry through improved transparency and stakeholder engagement. Mr. van Eeghen began his career at Ocean Equities (subsequently bought by Pareto Securities) in equity sales before joining GMP Securities (Europe) LLP (subsequently acquired by Stifel Financial Corp.) where he became a Partner. He has extensive experience including equity financing, debt, off-take agreements and structured notes, and has worked on both public market and private equity transactions. In addition to his capital markets work, Mr. van Eeghen has been a strong advocate for responsible corporate practice and transparency in the mining industry. He founded Reality Check Systems Limited ( Reality Check ) in 2015, which created a digital tool for the mining industry designed to build trust between companies and their stakeholders through greater transparency. The service has been utilized by some of the largest mining companies in the world and supports a number of the UN Sustainable Development Goals. Reality Check has been working in association with the London Stock Exchange Issuer Services Group since 2018. Mr. van Eeghen holds a BA (Honors) from Newcastle University in Financial & Business Economics. Carlo Calabria. Mr. Calabria, a Director, has close to 40 years of experience in the financial services sector and has held senior leadership positions in major international investment banks. From 2016 to 2020, he served as Head of Banking for Barclays Europe and was responsible for the investment banking activities in CEEMENA. Mr. Calabria has also served as Head of International M&A first at Credit Suisse as well as Bank of America Merrill Lynch. He is the Founder and Chairman of CMC Capital Limited, an independent investment banking boutique firm and rejoined this firm at the beginning of 2021. In February 2021, alongside Heritage, Mr. Calabria co-sponsored Centricus Acquisition Corp., a $345 million SPAC IPO listed on the NASDAQ. The SPAC successfully completed its initial business combination with software company Arqit Quantum Inc. (ticker ARQQ and ARQQW) in September 2021 and Mr. Calabria now serves on Arqit Quantum s board of directors. He holds an M.A. in Economics (Honors) from Rome University, La Sapienza. Helen Pein. Ms. Pein, a Director, has over 35 years of experience as an economic geologist in the natural resources sector. Ms. Pein is currently a director of Trident Resources plc and Pan Iberia Ltd. (UK) as well as a founding member of Panex Resources Pty. Ltd. (SA), a private company focusing on finding and developing global exploration projects. Previously, she was a director and shareholder of Pangea Exploration (Pty) Ltd, where she was part of the small team responsible for the discovery and evaluation of a number of world class gold and mineral sands deposits throughout Africa (Burnstone, Tuluwaka, Buzwagi, Corridor Sands and Kwale). Since 2012, Pangea has been affiliated with metals & mining private equity firm, Denham Capital International, providing asset analysis and technical evaluation of mining investments in Africa. She is currently CEO of Canadian private junior mining company, Goldrange Resources Corp., which is focused on early stage gold projects in Africa. Ms. Pein is a recipient of the Gencor Geology Award and Fellow of the Geological Society of South Africa and member of the International TABLE OF CONTENTS Society for Economic Geologists. She holds a B.Sc. Geoscience and a B.Sc. Geology (Hons) (Cum Laude), from the University of Stellenbosch SA. Raju Jaddoo. Mr. Jaddoo, a Director, is a corporate finance and investment advisory professional with broad experience in financial management acquired over almost 30 years working in different sectors and several countries. He is currently an independent director on the board of a number of global private equity funds. From 2004 to 2010, Mr. Jaddoo was the Chief Financial Officer of Titanium Resources Group Ltd, a public mining company listed on the London Stock Exchange, where he was responsible for the overall finance function and also deeply involved in several rounds of capital raisings. Previously, Mr. Jaddoo served as the Managing Director of the Board of Investment of Mauritius and spent 15 years as a partner at De Chazal Du Mee Chartered Accountants, the representative firm of Arthur Andersen in Mauritius. Oliver Turner. Oliver Turner, a Director nominee, is a seasoned mining executive and capital markets professional. He currently serves as Executive Vice President of Corporate Development at Karora Resources, a publicly listed company on the Toronto Stock Exchange (ticker KRR). Karora Resources is a rapidly growing gold producer headquartered in Toronto with assets in Australia. Prior to his role at Karora, Mr. Turner served as Senior Vice President of Precious Metals Equity Research at GMP Securities for six years and was involved in more than $5 billion in M&A transactions and $500 million in equity offerings. Mr. Turner began his career as a mining engineer for Wardrop Engineering and holds a Bachelor of Applied Science in Mining Engineering from Queen s University at Kingston. He is a CFA Charterholder. Our Advisory Committee Jean-Raymond Boulle and Manfredi Lefebvre d Ovidio will serve on the Company s Advisory Committee, which will provide non-binding strategic advice to the Company s management. There may be additional members to the Advisory Committee. Background In early 2021, Jean Boulle Group and Heritage Group partnered to form a new jointly-owned vehicle named Boulle Heritage LLC, our sponsor. Our sponsor is owned 42.5% by Heritage, 50% by Jean Boulle Group, 5% by Carlo Calabria and 2.5% by Cristina Levis. Boulle Heritage LLC is focused on generating value through long-term investments in attractive businesses within industries in which the principal owners and/or management have expertise and proven success. The Jean Boulle Group is a private group of companies owned and controlled by Jean-Raymond Boulle, who has a successful investment and operating track record spanning several decades and multiple sectors. His experience includes the mining, processing and marketing of metals and materials within the electrification and decarbonization value chains and investing in, managing and maximizing the value of high growth companies. The Jean Boulle Group s interests span a broad range of areas, but its principal focus is in natural resources, medical technology and philanthropy. The Jean Boulle Group works with management teams and others to optimize the structure, strategy and development of its investments, and accesses private as well as public capital. The Jean Boulle Group is a member of the U.S. Corporate Council on Africa ( CCA ), the leading U.S. business association focused solely on connecting business interests in the continent. Jean-Raymond Boulle currently serves as a director of CCA. Heritage has the experience of sponsoring a SPAC, having co-sponsored a $345 million generalist SPAC, Centricus Acquisition Corp., which IPO ed in February 2021. Centricus Acquisition Corp. announced a business combination with Arqit Quantum Inc., a software company, in May 2021. The transaction subsequently closed in September 2021. Mr. Calabria and Ms. Levis will act as co-sponsors alongside Jean Boulle Group and Heritage Group. Mr. Calabria contributes four decades of experience in bespoke M&A advisory in the travel and cruise sector, including travel infrastructure and other related B2C businesses such as airports, duty free and food & beverage. Ms. Levis started her career at a financial services firm in Switzerland before joining the securitisation team of Banca Finint in Italy, where she went on to manage the structured finance practice of Banca Finint in Luxembourg. In 2011, Ms. Levis joined Silversea Cruises as Chief Business Development Officer and assumed the role of Managing Director of Silversea Expeditions. In 2019, Ms. Levis was appointed Chief TABLE OF CONTENTS Investment Officer of Monaco-based diversified investment group Heritage. Ms. Levis also serves as Vice Chairman of Abercrombie & Kent, Chairman of Bucksense, Inc. and serves on the board of directors of Finanziaria Internazionale SGR. Mr. Lefebvre d Ovidio, the principal of Heritage Group, and Mr. Calabria have proven multi-year experience of collaboration, including the IPO of Centricus Acquisition Corp. (See Risk Factors Past performance by our sponsor s owners, and by our directors and management, or their respective affiliates, may not be indicative of future performance of an investment in us or in the future performance of the target business we may acquire. ). The principal owners and/or management of Boulle Heritage LLC have global networks with market leading companies, advisors, industry specialists and regulatory and stakeholder organizations. In particular, the Jean Boulle Group has a track record of conducting mining and exploration operations for gold, copper, nickel, zinc, titanium, cobalt, zircon, aluminium oxide and diamonds and other precious and semi-precious stones. The Jean Boulle Group entities have been active in Angola, Australia, Brazil, Canada, the Central African Republic, the Democratic Republic of the Congo, Equatorial Guinea, Finland, Liberia, Madagascar, Namibia, Russia, Sierra Leone, South Africa, the United States and Zambia. Companies founded or controlled by Jean Boulle Group entities have successfully generated value from operations over time by focusing on: Industries, commodities and products in which they have knowledge; Exploration in jurisdictions where they have local community and government relationships; and Execution of clear and defined strategies with measurable key performance indicators ( KPIs ). Following these guidelines, the Jean Boulle Group and Jean-Raymond Boulle have been a driving force behind various public and private mining companies, including Diamond Fields Resources Inc., American Mineral Fields Inc., Titanium Resources Group Ltd, and World Titanium Resources Inc. Jean-Raymond Boulle founded Diamond Fields Resources Inc. ( DFR ) and served as its first CEO and Chairman. Under his leadership, DFR listed on the Toronto Stock Exchange and in 1994 discovered one of the largest nickel/cobalt deposits in the world at Voisey s Bay, Canada. The deposit contained 141 million tonnes at a nickel grade of 1.6% and is considered one of the most substantial mineral discoveries in Canadian history. Inco acquired DFR s Voisey s Bay project in 1996 and, following its eventual startup in 2005, Voisey s Bay grew into one of the world s largest nickel producing mines. DFR s other mineral assets were spun out into a new company that became Diamond Fields International, Ltd., later renamed Diamond Fields Resources. DFR is currently listed on the TSX-V Exchange and Jean-Raymond Boulle is its largest shareholder. American Mineral Fields Inc. was a company established by Jean-Raymond Boulle in 1995 and listed on both the Toronto Stock Exchange and London Stock Exchange (AIM). The company acquired the world-class Kolwesi copper and cobalt tailings deposit as well as the Kipushi zinc deposit in the Democratic Republic of Congo. While the breakout of the Second Congo War delayed initial development, Jean- Raymond Boulle remained committed to both projects and, following the conflict, invested materially and advanced technical work to prepare the assets for production. The company was renamed Adastra Minerals and, in 2006, merged with First Quantum Minerals, Ltd. in a transaction valued at approximately C$245 million. In the early 2000s, Jean-Raymond Boulle formed Titanium Resources Group ( TRG ), which acquired the Sierra Rutile (titanium) and Sierra Bauxite (aluminum) Projects in Sierra Leone. Following the Sierra Leone civil war, TRG rebuilt the mines and became the largest private employer in Sierra Leone at that time. TRG (later renamed Sierra Rutile Limited) was listed on the London Stock Exchange (AIM) in 2005. The bauxite operation was acquired by Vimetco in 2008 and Sierra Rutile Limited was acquired in 2016 by Iluka Resources Ltd. In 2011, Jean-Raymond Boulle formed World Titanium Resources ( WTR ) which listed on the Australian Stock Exchange that same year. WTR held licenses to large ilmenite deposits located in southwestern Madagascar. In 2017, Base Resources acquired 85% of WTR (renamed World Titane Holdings). TABLE OF CONTENTS The Jean Boulle Group has also been active in mineral exploration in Greenland. The Jean Boulle Group is currently the majority shareholder of Greenland Anorthosite Mining ApS, which attracted co-investment from the governments of Greenland and Denmark following discovery of a large anorthosite deposit on the country s west coast. Other investors include the Danish state investment fund V kstfonden, Greenland State investment company Greenland Venture and the Greenlandic Pension Fund SISA. The mineral discovered is a more valuable and environmentally friendly choice for use by fibreglass manufacturers and in aluminium production and initial geological findings suggest that the company could operate well into the future. Outside of the mining space, the Jean Boulle Group has been a long-term major shareholder in Omnicane Limited, a company publicly listed on the Mauritius Stock Exchange. Omnicane has interests in agriculture (including the cultivation of sugarcane and the downstream production of refined sugar), energy (including bioethanol, thermal energy and electricity) and real estate. A Jean Boulle Group company was also a founder of Tendyne Holdings, Inc., the developer of the Tendyne mitral heart valve. After five years of focused research and development, Tendyne was acquired by Abbott Laboratories in 2015. Market Opportunity Driven by concerns around climate change and environmental pollution, the world continues to rapidly move towards more environmentally-friendly forms of energy and low carbon industrial processes. This pace of this energy mix transformation has quickened in recent years and has been the result of the collective efforts of private and public entities around the world, including key global investors and capital providers. We expect this transformation to further accelerate and, therefore, see material long-term demand growth for critical basic raw materials which will be required to both support a more environmentally-friendly global energy mix and to reduce the carbon intensity of existing processes. The International Renewable Energy Agency (IRENA) anticipates $110 trillion of cumulative investment spending will be required into the sector between 2016 and 2050 as noted in its 2020 Global Renewables Outlook. The demand growth is expected to come from more advanced economies in the near-term, but we also anticipate supportive and growing tailwinds from developing countries where decarbonization and environmental policies are also taking hold. Accordingly, we envision a truly global set of investment opportunities in all jurisdictions where the critical raw materials to support decarbonization are either mined or processed. Due to the rapid pace of the ongoing energy transition, we expect substantial market opportunities involving the following metals, minerals and chemicals: Decarbonization: Metals, minerals or chemicals which are either directly or indirectly used to support the development of (i) electric vehicle batteries, (ii) fuel cells, (iii) renewable energy or (iv) less carbon-intensive end-use materials. These decarbonization metals include (but are not limited to) copper, cobalt, lithium, manganese, nickel, graphite, tin, uranium, platinum group metals (platinum, palladium and rhodium), vanadium and aluminum. Technological: Metals, minerals or chemicals which are used to produce high-quality industrial materials that improve performance and the energy efficiency of end-use applications. These technological metals include (but are not limited to) rare earths, gallium, germanium, indium, tellurium and tantalum. Strategic: Metals, minerals or chemicals which (i) service a growing niche market segment, (ii) provide a proxy economic hedge, (iii) reduce the carbon emissions footprint of existing technology or (iv) are on the critical material supply lists. These strategic metals include (but are not limited to) gold, silver, green steel, tungsten, diamonds, hydrogen and titanium. In serving the increasingly demanding electrification and decarbonization value chains, we see rising demand and supply constraints over the mid-to-long-term for many of the metals, minerals and chemicals within the above categories. According to the International Energy Agency report dated May 2021, annual global sales for new electric vehicles are expected to increase by a multiple of 24 by 2040, which is expected to result in an increase in demand for metals and minerals, such as graphite, cobalt, manganese, nickel, lithium and copper, used in electric vehicles. As an example, we expect that copper will be increasingly required as an input into the electric vehicle value chain as well as for the development of renewable energy infrastructure. However, copper has faced chronic under-investment over time as well as declining ore grades TABLE OF CONTENTS and material investment is broadly expected to be required in order to service growing global needs over the long-term. This supply challenge is further exacerbated by long lead times from investment to first production for the majority of development projects, creating the need for material capital investment that supports increased production of key metals, minerals and chemicals. In addition to the above fundamentals, we believe capital is currently being invested into many companies seeking to participate in the ongoing clean energy transformation in an inefficient manner without appropriate due diligence and with the sole intention of short-term value uplift. We believe that our approach is different in that we have a track record of supporting businesses over the long-term which meshes well with the multi-decade energy thematic underpinning the investment opportunities at hand. Further, we believe our management team is knowledgeable across a broad range of commodities. Accordingly, we believe we have the ability to identify and support the best of such businesses within the opportunity landscape. Business Strategy Our business strategy is to identify and complete our initial business combination with a business that can benefit from our strategic, operational, and transactional experience. We believe we are well positioned to identify attractive business combination opportunities in the electrification and decarbonization value chains. Our primary focus is on high-growth businesses engaged in the mineral extraction and production of metals, minerals and chemicals that support this transition to a lower carbon economy, while remaining open to unique high-value industrial opportunities that demonstrate significant value potential to our shareholders. We have a global network of relationships with management teams of public and private companies, private equity sponsors, public investors, traders, investment bankers and lenders. We believe that these networks will help us to examine global acquisition opportunities across a broad range of target metals, materials and chemicals across the electrification and decarbonization value chains and increase our likelihood of finding an attractive acquisition target. Our sponsor s owners and our members of our management team have significant track records of building leading companies within multiple sectors including mining, consumer and medical technology and creating value through both organic and inorganic growth. Our strategy is to focus on opportunities that enhance our ability to deliver this growth through development execution, free cash flow enhancement, fundamental operational improvements and differentiated market insight. The experience of our management team in identifying, structuring, and negotiating transactions with both medium and large companies is critical to executing this strategy. We intend to seek ways to address and reduce any potential negative social or environmental impact associated with our businesses. Accordingly, an important part of our strategy is to hold any identified business opportunities to these standards. We intend to be engaged with the business created by our initial business combination, including seeking an ongoing and active role at the board level following the initial combination. Our strategy is underpinned by our focus on long-term value creation through development execution, growth and vertical integration and in order to implement and monitor its execution we intend to seek a controlling or influential minority position following the initial combination. In addition to the deal flow we expect from our network of contacts, we anticipate that target business candidates may approach us and be brought to our attention from various unaffiliated sources, which may include investment market participants, private equity groups, investment banking firms, consultants, accounting firms and international and regional mining companies. Upon completion of this offering, we plan to communicate with our networks of relationships to articulate the parameters for our search for a target company and a potential business combination and begin the process of pursuing and reviewing potentially interesting leads. Business Combination Criteria We intend to execute a strategy focused on the demonstrated strengths of our board and management team in identifying attractive assets, improving and executing upon growth plans, and delivering value to TABLE OF CONTENTS shareholders while allowing a breadth of potential opportunities to fit within the scope. Our acquisition strategy will be focused on assets that we believe have the potential for future value creation. We have identified the following core attributes that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target company that does not meet these criteria and guidelines. We intend to seek to acquire businesses that we believe: possess an attractive strategic position within the electrification transition and decarbonization value chains with a fundamentally strong demand outlook for their products or services; operate within industries and sectors (primarily in the decarbonization, strategic or technological materials described above) in which we can apply our technical, strategic and operational expertise; are domiciled in business friendly jurisdictions, (though excluding sanctioned countries); possess the critical attributes of established high-quality businesses, including competitive position and strong cash flow potential; possess a strong management team with key people that we believe have the capacity to lead an expansion strategy with a listed company; demonstrate a clear value growth proposition for our shareholders through one or more of the following characteristics: (i) current under-valuation by the marketplace within larger portfolios; (ii) potential for margin expansion via operational and management improvements; (iii) internal growth opportunities that can be unlocked by improved access to capital; and/or (iv) external growth potential with a focus on vertical integration and partnerships; possess the potential for high growth, including through vertical integration and consolidation, focused on economies of scale and potential synergies; are positioned to experience growth in cash flow post acquisition; possess inherent operational characteristics that can drive positive ESG change; are prepared to be public companies and will benefit from having a public currency in order to enhance their opportunity to pursue accretive acquisitions, high return capital projects and/or strengthen their balance sheet; offer an attractive, risk adjusted return on investment for our shareholders. While these criteria will be used in evaluating business combination opportunities, we may decide to enter into a business combination with a target business or target businesses that do not meet all of these proposed criteria. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines, as well as other considerations, factors and criteria that our management may deem relevant. If we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender-offer documents or proxy solicitation materials that we would file with the Securities and Exchange Commission, or SEC. Ability to Extend Time to Complete Business Combination If we anticipate that we may not be able to consummate our initial business combination within 18 months from the consummation of this offering, we may, but are not obligated to, by resolution of our board of directors if requested by our sponsor, extend the period of time to consummate an initial business combination up to two times by an additional three months each time for a total of up to 24 months if our sponsor or its affiliate or designate deposits $0.10 per unit into the Trust Account in respect of each such 3-month extension (the Paid Extension Period ). In addition, we will be entitled to an automatic three-month extension (the Automatic Extension Period ) if we have filed a preliminary proxy statement, registration statement or similar filing for an initial business combination during the 18-month period or TABLE OF CONTENTS Paid Extension Period, to complete an initial business combination. Public shareholders will not be offered the opportunity to vote on or redeem their shares at the end of the 18-month period or any initial Paid Extension Period if we choose to make any such paid extension or further paid extension, or in connection with an automatic extension, as applicable. Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement, in order to avail ourselves of the Paid Extension Period to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three-month extension $1,500,000, or $1,725,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. Any such payments would be made in the form of a loan. Any such time extension funding loans will be non-interest bearing and payable upon the consummation of our initial business combination. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us. Up to $3,450,000 of such time extension funding loans may be converted into 3,450,000 private placement warrants of the post business combination entity at a price of $1.00 per warrant at the option of the lender. If we do not complete an initial business combination, we will not repay such loans. In the event that we receive notice from our sponsor or its affiliates five days prior to the applicable deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. For the avoidance of doubt, no amounts need to be deposited into the trust account for the Automatic Extension Period. Our public shareholders will not be entitled to vote or redeem their shares at the end of the 18-month period or any initial Paid Extension Period if we choose to make any such paid extension or further paid extension, or in connection with an automatic extension, as applicable. As a result, we may conduct such an extension even though a majority of our public shareholders do not support such an extension and will not be able to redeem their shares in connection therewith. Initial Business Combination So long as our securities are listed on NYSE, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets of the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination. We refer to this as the 80% of net assets test. The fair market value of the target or targets will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our board of directors will rely on generally accepted standards, our board of directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the board of directors in evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by us in connection with any proposed initial business combination will provide public shareholders with our analysis of our satisfaction of the 80% of net assets test, as well as the basis for our determinations. If our board of directors is not able to independently determine the fair market value of the target business or businesses or determines it would be helpful to have one, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, or FINRA, or an independent accounting firm with respect to the satisfaction of such criteria. The reasons for obtaining such outside opinion include, but are not limited to, if the board is less familiar or experienced with the target company s business, if there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of fair market value test, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, TABLE OF CONTENTS any proxy statement that we deliver to shareholders and file with the SEC in connection with a proposed initial business combination will include such opinion. We may pursue a combination opportunity jointly with our sponsor, or one or more of its affiliates, which we refer to as an Affiliated Joint Acquisition. Any such parties may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by issuing to such parties a class of equity or equity-linked securities. Any such issuance of equity or equity-linked securities would, on a fully diluted basis, reduce the percentage ownership of our then- existing shareholders. Notwithstanding the foregoing, pursuant to the anti-dilution provisions of our Class B ordinary shares, issuances or deemed issuances of Class A ordinary shares or equity-linked securities would result in an adjustment to the ratio at which Class B ordinary shares shall convert into Class A ordinary shares such that our initial shareholders and their permitted transferees, if any, would retain their aggregate percentage ownership at 20% of the sum of the total number of all shares of ordinary shares outstanding upon completion of this offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with the business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination), unless the holders of a majority of the then-outstanding Class B ordinary shares agree to waive such adjustment with respect to such issuance or deemed issuance at the time thereof. Neither our sponsor, nor any of their respective affiliates, have an obligation to make any such investment, and may compete with us for potential business combinations. We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, including an Affiliated Joint Acquisition, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, (the Investment Company Act ). Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on NYSE for whatever reason, we would no longer be required to meet the foregoing 80% of net assets test. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. TABLE OF CONTENTS Other Considerations We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor or any of our officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm that is a member of FINRA, or an independent accounting firm that such initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. We currently do not have any specific business combination under consideration. Our management team is regularly made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a business combination transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Certain of our directors and officers will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, such officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Our sponsor, officers and members of our board of directors acquired founder shares for approximately $0.0058 per share and we are offering units at a price of $10.00 per unit in this offering; as a result, our sponsor, officers and members of our board of directors could make a substantial profit after the initial business combination even if public investors experience substantial losses and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. (See Risk Factors Since our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed (other than with respect to public shares they may acquire during or after this offering), a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. ) In addition, certain of our officers and directors presently have, and any of them in the future may have fiduciary and contractual duties to other entities. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to their fiduciary duties under Cayman Islands law, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. For example, an affiliate of our sponsor has in the past sponsored another blank check company (Centricus Acquisition Corp.), and is evaluating whether to sponsor other blank check companies in the future. Any such companies may pursue similar targets and compete with us for business combination opportunities. Centricus Acquisition Corp. announced on May 12, 2021 an initial business combination with Arqit Quantum Inc., a cybersecurity company that supplies a unique quantum encryption technology that makes the communications links of any networked device secure against cyber attack. Mr. Calabria is now a board member of Arqit Quantum Inc. following its business combination with Centricus Acquisition Corp. He therefore owes fiduciary duties to Arqit Quantum Inc. However, none of the foregoing blank check companies is limited to a particular industry or geographic region in its search for its own business combination. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. In addition, we may pursue an Affiliated Joint Acquisition opportunity with an entity to which an officer or director has a fiduciary or contractual obligation. Any such entity may co-invest with us in the target business at the time of our TABLE OF CONTENTS initial business combination, or we could raise additional proceeds to complete the acquisition by issuing to such entity a class of equity or equity- linked securities. Our amended and restated memorandum and articles of association provide that we renounce our interest in any business combination opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. Our sponsor, officers and directors may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates. However, we do not currently expect that any such other blank check company would materially affect our ability to complete our initial business combination. In addition, our sponsor, officers and directors are not required to commit any specified amount of time to our affairs and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Corporate Information Our registered offices are located at Ugland House, Grand Cayman, Cayman Islands, KY1-1104. The information contained on or accessible through our corporate website or any other website that we may maintain is not part of this prospectus or the registration statement of which this prospectus is a part. We are a Cayman Islands exempted company with limited liability. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cabinet Office of the Cayman Islands that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from April 12, 2021, no law which is thereafter enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates equals or exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible TABLE OF CONTENTS debt during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of any fiscal year for so long as either (1) the market value of our ordinary shares held by non-affiliates is less than $250 million as of the end of that year s second fiscal quarter or (2) our annual revenues are less than $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates is less than $700 million as of the end of that year s second fiscal quarter. TABLE OF CONTENTS The Offering In deciding whether to invest in our securities, you should take into account not only the backgrounds of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors of this prospectus. Securities offered 15,000,000 units (or 17,250,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one-half of one redeemable warrant. Proposed NYSE symbols Units: RAFU Class A ordinary shares: RAF Warrants: RAFW Trading commencement and separation of Class A ordinary shares and warrants The units are expected to begin trading on or promptly after the date of this prospectus. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Citigroup Global Markets Inc. and BofA Securities, Inc. inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after the completion of our initial business combination. Separate trading of the Class A ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended TABLE OF CONTENTS Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 15,000,000(1) Ordinary shares: Number outstanding before this offering 4,312,500(2)(3) Number outstanding after this offering 18,750,000(1)(2)(4) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 10,600,000(1) Number of warrants to be outstanding after this offering and the sale of private placement warrants 18,100,000(1) Exercisability Each whole warrant is exercisable to purchase one Class A ordinary share, subject to adjustment as described herein. Only whole warrants are exercisable. We structured each unit to contain one-half of one redeemable warrant, with each whole warrant exercisable for one Class A ordinary share, as compared to units issued by some other similar blank check companies that contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon the completion of our initial business combination as compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. (1) Assumes no exercise of the underwriters over-allotment option. (2) Founder shares are currently classified as Class B ordinary shares, which shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association. Such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we do not consummate an initial business combination. (3) Includes 562,500 founder shares that are subject to forfeiture. (4) Includes 15,000,000 public shares and 3,750,000 founder shares, assuming 562,500 founder shares have been forfeited. TABLE OF CONTENTS Exercise price $11.50 per share, subject to adjustments as described herein. In addition, if (i) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per ordinary share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (ii) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (iii) the volume weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price and the $18.00 per share redemption trigger price described adjacent to Redemption of public warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable 30 days after the completion of our initial business combination, provided that we have an effective registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the warrants, a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. The registration statement of which this prospectus forms a part registers the Class A ordinary shares issuable upon exercise of the warrants. We have agreed that as soon as practicable, but in no event later than 20 business days after the closing of our initial business combination, we will use commercially reasonable efforts to file with the SEC a post-effective amendment to the registration statement of which this prospectus forms a part or a new registration statement covering the Class A ordinary shares issuable upon exercise of the warrants, and we will use commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those Class A ordinary TABLE OF CONTENTS shares until the warrants expire or are redeemed, as specified in the warrant agreement, provided that, if our Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. Because the warrants are not exercisable until 30 days after the completion of our initial business combination, we do not currently intend to update the registration statement of which this prospectus forms a part or file a new registration statement covering the Class A ordinary shares issuable upon exercise of the warrants until after the initial business combination has been consummated. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th business day after the closing of the initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption, but we will use commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of public warrants Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last reported sale price (the closing price ) of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities - Warrants Public Shareholders Warrants Anti-dilution Adjustments ) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. TABLE OF CONTENTS We will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption period. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our shareholders of issuing the maximum number of Class A ordinary shares issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the fair market value of our Class A ordinary shares over the exercise price of the warrants by (y) the fair market value. The fair market value of our Class A ordinary shares as used in this section and in Redemption of public warrants above shall mean the average last reported sale price of our Class A ordinary shares for the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants. See Description of Securities Warrants Public Shareholders Warrants for additional information. None of the private placement warrants will be redeemable by us. Founder shares On April 23, 2021, our sponsor made a capital contribution of $25,000, or approximately $0.0043 per share, to cover certain expenses on our behalf in consideration of 5,750,000 Class B ordinary shares, par value $0.0001. Subsequently, our sponsor transferred 60,000 founder shares to each of Martyn Buttenshaw and John van Eeghen and 20,000 founder shares to each of Bertrand Boulle, Helen Pein, Raju Jaddoo, Carlo Calabria and Oliver Turner, resulting in our sponsor holding 5,530,000 founder shares. On February 15, 2022, the sponsor surrendered and forfeited an aggregate of 1,437,500 founder shares for no consideration following which there are 4,312,500 founder shares outstanding. The sponsor s effective investment per founder share is approximately $0.0058. The per share price of the founder shares was determined by dividing the amount contributed to the company by the number of founder shares issued. If we increase or decrease the size of this offering, we will effect a share capitalization, a share surrender or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of this offering in such amount as to TABLE OF CONTENTS maintain the number of founder shares, on an as-converted basis, at 20% of our issued and outstanding ordinary shares upon the consummation of this offering. Up to 562,500 founder shares are subject to forfeiture by the sponsor, depending on the extent to which the underwriters over-allotment option is exercised. The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, except that: prior to our initial business combination, only holders of the founder shares have the right to vote on the appointment of directors and holders of a majority of our founder shares may remove a member of the board of directors for any reason; the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, directors and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares and public shares in connection with our initial business combination, (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within the completion window or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within the completion window (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed timeframe). If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law and pursuant to our amended and restated memorandum and articles of association, which requires the affirmative vote of a majority of the shareholders who attend and vote in person or by proxy at a quorate general meeting of the company or a unanimous written resolution of all of our shareholders entitled to vote at a general meeting of the company. A quorum for such meeting will be present if holders of one-half of the issued and outstanding shares entitled to vote at the meeting are represented in person or by proxy. In such case, our sponsor and each member of our management team have TABLE OF CONTENTS agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 5,625,001, or 37.5% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), of the 15,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved; the founder shares will automatically convert into our Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association; and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Except as described herein, our initial shareholders have agreed not to transfer, assign or sell any of their founder shares until the earliest of (A) one year after the completion of our initial business combination and (B) subsequent to our initial business combination, (x) if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our public shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. Any permitted transferees would be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. Founder shares conversion and anti-dilution rights The founder shares are designated as Class B ordinary shares and will automatically convert into Class A ordinary shares, which such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we do not consummate an initial business combination, at the time of our initial business combination or earlier at the option of the holders thereof at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of (i) the total number of ordinary shares issued and outstanding upon the completion of this offering, plus (ii) the total number of Class A ordinary shares issued, deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary TABLE OF CONTENTS shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued or to be issued to any seller in the initial business combination and any private placement warrants issued to our sponsor, its affiliates or any member of our management team upon conversion of working capital loans or extension funding loans. Any conversion of Class B ordinary shares described herein will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. Appointment of directors; Voting rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution passed by not less than two-thirds of our ordinary shares who attend and vote in person or by proxy at a quorate general meeting of the company which shall include the affirmative vote of a simple majority of our Class B ordinary shares or by a unanimous written resolution of all of our shareholders entitled to vote at a general meeting of the company. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 10,600,000 private placement warrants (or 11,612,500 private placement warrants if the underwriters over- allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, at a price of $1.00 per warrant ($10,600,000 in the aggregate or $11,612,500 if the underwriter s over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. If we do not consummate an initial business combination within the completion window, the private placement warrants will expire worthless. The private placement warrants will be non-redeemable by us and exercisable on a cashless basis so long as they are held by our sponsor or its permitted transferees (see Description of Securities Warrants Private Placement Warrants ). If the private placement warrants are held by holders of other than our sponsor or its permitted transferees, the private placement warrants will be redeemable by us in all redemption TABLE OF CONTENTS scenarios and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Transfer restrictions on private placement warrants The private placement warrants (including the Class A ordinary shares issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under Principal Shareholders Transfers of Founder Shares and Private Placement Warrants. Cashless exercise of private placement warrants If holders of private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the sponsor fair market value (defined below) over the exercise price of the warrants by (y) the sponsor fair market value. The sponsor fair market value shall mean the average last reported sale price of the Class A ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that restrict insiders from selling our securities except during specific periods of time. Proceeds to be held in trust account Of the proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, $153,750,000, or $176,812,500 if the underwriters over-allotment option is exercised in full ($10.25 per unit in either case), will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. The proceeds to be placed in the trust account include $5,250,000 (or $6,037,500 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our income taxes, if any, our amended and restated memorandum and articles of association, as discussed below and subject to the requirements of law and regulation, will provide that the proceeds from this offering and the sale of the private placement warrants held in the trust account will not be released from the trust account (1) to us, until the completion of our initial business combination, or (2) to our public shareholders, until the earliest of (a) the completion of our initial business combination, and then only in connection with those Class A TABLE OF CONTENTS ordinary shares that such shareholders properly elected to redeem, subject to the limitations described herein, (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within the completion window or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares, and (c) the redemption of our public shares if we have not consummated our business combination within the completion window, subject to applicable law. Public shareholders who redeem their Class A ordinary shares in connection with a shareholder vote described in clause (b) in the preceding sentence shall not be entitled to funds from the trust account upon the subsequent completion of an initial business combination or liquidation if we have not consummated an initial business combination within the completion window, with respect to such Class A ordinary shares so redeemed. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act that invest only in direct U.S. government treasury obligations. Assuming an interest rate of 0.1% per year, we estimate the interest earned on the trust account will be approximately $153,750 per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $2,500,000 in working capital after the payment of approximately $1,350,000 in non-reimbursed expenses relating to this offering; and any loans or additional investments from our sponsor, its affiliates or certain of our officers and directors, although they are under no obligation to advance funds to us in such circumstances, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon the completion of our initial business combination. TABLE OF CONTENTS Conditions to completing our initial business combination So long as our securities are then listed on NYSE, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm with respect to the satisfaction of such criteria. The reasons for obtaining such outside opinion include, but are not limited to, if the board is less familiar or experienced with the target company s business, if there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Our shareholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. If our securities are not then listed on NYSE for whatever reason, we would no longer be required to meet the foregoing 80% of net assets test. We will complete our initial business combination only if the post-business combination company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. Permitted purchases and other transactions with respect to our securities If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender TABLE OF CONTENTS offer rules, our sponsor, officers, directors, advisors or their affiliates may purchase public shares or warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, officers, directors, advisors or their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase public shares or warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended, or the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going- private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will be required to comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. See Proposed Business Effecting Our Initial Business Combination Permitted Purchases and Other Transactions with Respect to Our Securities for a description of how our sponsor, officers, directors, advisors or their affiliates will select which shareholders to purchase securities from in any private transaction. The purpose of any such transaction could be to (i) vote in favor of the business combination and thereby increase the likelihood of obtaining shareholder approval of the business combination, (ii) reduce the number of public warrants outstanding or vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination or (iii) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our Class A ordinary shares or public warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to TABLE OF CONTENTS maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public shareholders upon the completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per- share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then- outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.25 per public share. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Further, we will not proceed with redeeming our public shares, even if a public shareholder has properly elected to redeem its shares, if a business combination does not close. Our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with (i) the completion of our initial business combination and (ii) a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within the completion window or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares. Limitations on redemptions Our amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we do not then become subject to the SEC s penny stock rules). However, a greater net tangible asset or cash requirement may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the TABLE OF CONTENTS proposed business combination. Furthermore, although we will not redeem shares in an amount that would cause our net tangible assets to fall below $5,000,001, we do not have a maximum redemption threshold based on the percentage of shares sold in this offering, as many blank check companies do. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, all Class A ordinary shares submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination or seek to revise the terms of such business combination. In addition, if accepting all properly submitted redemption requests in connection with an amendment we seek to make to our amended and restated memorandum and articles of association would cause our net tangible assets to be less than $5,000,001, we would not proceed with such amendment or the related redemption of our public shares at such time. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require shareholder approval, while direct mergers with our company and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would typically require shareholder approval. We currently intend to conduct redemptions in connection with a shareholder vote unless shareholder approval is not required by applicable law or stock exchange listing requirement or we choose to conduct redemptions pursuant to the tender offer rules of the SEC for business or other reasons. If we hold a shareholder vote to approve our initial business combination, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an TABLE OF CONTENTS ordinary resolution under Cayman Islands law and pursuant to our amended and restated memorandum and articles of association, which requires the affirmative vote of a majority of the shareholders who attend and vote in person or by proxy at a quorate general meeting of the company. A quorum for such meeting will be present if holders of one-half of the issued and outstanding shares entitled to vote at the meeting are represented in person or by proxy. In such case, our sponsor and each member of our management team have agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 5,625,001, or 37.5% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), of the 15,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. The quorum and voting thresholds, and the voting agreements of our initial shareholders will make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed initial business combination or vote at all. Our amended and restated memorandum and articles of association will require that at least five days notice will be given of any such general meeting. If we conduct redemptions pursuant to the tender offer rules of the SEC, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than the number of public shares we are permitted to redeem. If public shareholders tender more shares than we have offered to TABLE OF CONTENTS purchase, we will withdraw the tender offer and not complete such initial business combination. Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, then, pursuant to our amended and restated memorandum and articles of association, a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public Release of funds in trust account on closing of our initial business shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management team at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering without our prior consent, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be disbursed directly by the trustee to pay amounts due to any public shareholders who properly exercise their redemption rights as described above adjacent to the caption Redemption rights for public shareholders upon the completion of our initial business combination, to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses TABLE OF CONTENTS associated with our initial business combination. If our initial business combination is paid for using equity or debt or not all of the funds released to us from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for the maintenance or expansion of operations of post- business combination company, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated memorandum and articles of association will provide that we will have only until the end of the completion window to consummate our initial business combination. If we have not consummated an initial business combination within the completion window, we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of the then- outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to consummate an initial business combination within the completion window. Our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within the completion window (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed timeframe). The underwriters have agreed to waive their rights to their deferred underwriting commissions held in the trust account in the event we do not consummate an initial business combination within the completion window and, in such event, such amounts will be included with the funds held in TABLE OF CONTENTS the trust account that will be available to fund the redemption of our public shares. Our sponsor and each member of our management team have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within the completion window or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares, unless we provide our public shareholders with the opportunity to redeem their public shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any, divided by the number of the then- outstanding public shares, subject to the limitations described above adjacent to the caption Limitations on redemptions. For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A of the Exchange Act seeking shareholder approval of such proposal and, in connection therewith, provide our public shareholders with the redemption rights described above upon shareholder approval of such amendment. This redemption right shall apply in the event of the approval of any such amendment, whether proposed by our sponsor, officer, director, director nominee or any other person. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions. Our amended and restated memorandum and articles of association will provide that, if we wind up for any other reason prior to the consummation of our initial business combination, we will follow the foregoing procedures with respect to the liquidation of the trust account as promptly as reasonably possible but not more than ten business days thereafter, subject to applicable Cayman Islands law. Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made by the company to our sponsor, officers or directors, or their respective affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; TABLE OF CONTENTS Reimbursement for office space, secretarial and administrative services provided to us by an affiliate of our sponsor, in the amount of $10,000 per month; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and Repayment of loans that may be made by our sponsor, its affiliates or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination or in connection with a Paid Extension. Up to $1,500,000 of such working capital loans and up to $3,450,000 of such extension funding loans may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Any such payments will be made either (i) prior to our initial business combination using proceeds of this offering and the sale of the private placement warrants held outside the trust account or from loans made to us by our sponsor, its affiliates or certain of our officers and directors or (ii) in connection with or after the consummation of our initial business combination. Audit committee We will establish and maintain an audit committee, which will be composed entirely of independent directors. Among its responsibilities, the audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors, or their respective affiliates, and monitor compliance with the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Conflicts of interest Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our business combination. Our memorandum and articles of association will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such TABLE OF CONTENTS person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. Notwithstanding the foregoing, we may pursue an Affiliated Joint Acquisition opportunity. Such entities may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by issuing to such entity a class of equity or equity-linked securities. In addition, our, and our sponsor s, owner s officers and directors participate, and may further participate, in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target. If these entities decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. Subject to his or her fiduciary duties under Cayman Islands law, none of our officers and directors who are also officers or directors of our sponsor and/or employees of its affiliates have any obligation to present us with any opportunity for a potential business combination of which they become aware. Our, and our sponsor s, directors and officers are also not prohibited from sponsoring, investing or otherwise becoming involved with, any other blank check companies, including in connection with their initial business combinations, prior to us completing our initial business combination. As a result, our, and our sponsor s, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. However, we do not believe that any potential conflicts would materially affect our ability to complete our initial business combination. Summary Risk Factors An investment in our securities involves a high degree of risk. The occurrence of one or more of the events or circumstances described in the section titled Risk Factors, alone or in combination with other events or circumstances, may materially adversely affect our business, financial condition and operating results. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to: The nominal purchase price paid by our sponsor for the founder shares may significantly dilute the implied value of your public shares in the event we complete an initial business combination. We are a newly incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance of our sponsor s owners, and by our directors and management, or their respective affiliates, may not be indicative of future performance of an investment in us or in the future performance of the target business we may acquire. Our independent registered public accounting firm s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a going concern. Our shareholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our shareholders do not support such a combination. TABLE OF CONTENTS Your only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash. If we seek shareholder approval of our initial business combination, our sponsor and members of our management team have agreed to vote in favor of such initial business combination, regardless of how our public shareholders vote. The ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. Because our trust account will contain $10.25 per Class A ordinary share, public shareholders may be more incentivized to redeem their public shares than the public shareholders of other blank check companies. The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. The requirement that we consummate an initial business combination within the completion window may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our shareholders. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19) pandemic and the status of debt and equity markets. We may not be able to consummate an initial business combination within the completion window, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate. If we seek shareholder approval of our initial business combination, our sponsor, officers, directors, advisors and their affiliates may elect to purchase public shares or warrants, which may influence a vote on a proposed business combination and reduce the public float of our Class A ordinary shares or public warrants. If a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss. NYSE may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. You will not be entitled to protections normally afforded to investors of many other blank check companies. If we seek shareholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a group of shareholders are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem all such shares in excess of 15% of our Class A ordinary shares. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we TABLE OF CONTENTS have not consummated our initial business combination within the required time period, our public shareholders may receive only approximately $10.25 per public share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate until at least the end of the completion window, it could limit the amount available to fund our search for a target business or businesses and our ability to complete our initial business combination, and we will depend on loans from our sponsor, its affiliates or members of our management team to fund our search and to complete our initial business combination. Each of our, and our sponsor s, officers, directors and director nominees presently is or may become in the future affiliated with entities engaged in business activities similar to those intended to be conducted by us, including another blank check company, and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Our sponsor, officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests. TABLE OF CONTENTS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires: references to amended and restated memorandum and articles of association are to our amended and restated memorandum and articles of association that we will adopt prior to the consummation of this offering; references to we, us or our company are to Atlas Growth Acquisition Limited, a Cayman Islands exempted company; references to China are to the People s Republic of China, including for these purposes Hong Kong and Macao; references to the Companies Act are to the Companies Act (Revised) of the Cayman Islands as the same may be amended from time to time; references to founder shares are to the 3,162,500 Class B ordinary shares currently held by the initial shareholders (as defined below), which include up to an aggregate of 412,500 Class B ordinary shares subject to forfeiture by our initial shareholders to the extent that the underwriters over-allotment option is not exercised in full or in part, and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination as described herein (for the avoidance of doubt, such Class A ordinary shares which are converted from Class B ordinary shares will not be public shares ); references to our initial shareholders are to our sponsor and any other holder of founder shares, including our officers and directors; references to ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; references to our management or our management team are to our officers and directors; references to our private warrants are to the warrants that our initial shareholders are purchasing privately from us in a private placement concurrent with this offering, as well as any warrants issued upon conversion of working capital loans; references to our public shares are to Class A ordinary shares which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and references to public shareholders refer to the holders of our public shares, including our initial shareholders to the extent our initial shareholders purchase public shares, provided that their status as public shareholders shall exist only with respect to such public shares; references to our public warrants are to the redeemable warrants sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); references to the representative are to Ladenburg Thalmann & Co. Inc., the representative of the underwriters; references to our sponsor are to Atlas Growth Holdings Limited, a Delaware limited liability company affiliated with our Chairman and Chief Executive Officer; and references to our warrants are to the public warrants as well as the private warrants. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any Table of Contents respectively. We cannot assure you that our securities will be approved for listing and, if approved, will continue to be listed on Nasdaq after this offering. Our executive offices are currently located in Singapore. In addition, all of our executive officers and directors are located outside of the United States. As a result, it may be difficult for investors to effect service of process within the United States on our company, executive officers and directors, or enforce judgments obtained in the United States courts against our company, executive officers and directors, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 and will therefore be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 30 for a discussion of information that should be considered in connection with an investment in our securities. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation to subscribe for securities may be made to the public in the Cayman Islands. Price to Public Underwriting Discounts and Commissions(1) Proceeds, Before Expenses, to us Per Unit $ 10.00 $ 0.55 (2) $ 9.45 Total $ 110,000,000 $ 6,050,000 $ 103,950,000 (1) The table does not include certain other fees and expenses payable to the underwriters in connection with this offering, including 7,500 founder shares which will be transferred by the sponsor to an affiliate of Brookline Capital markets, one of the joint book-running managers. Please see the section titled Underwriting for further information relating to the underwriting arrangements agreed to between us and the underwriters in this offering. (2) Includes $3,850,000, or $0.35 per unit, equal to 3.5% of the gross proceeds of this offering (or $4,427,500 if the underwriters over-allotment option is exercised in full) payable to the underwriters as deferred underwriting discounts and commissions from the funds to be placed in the trust account described below. Such funds will be released to the underwriters only upon consummation of an initial business combination, as described in this prospectus. If the business combination is not consummated, such deferred discount will be forfeited. Upon consummation of the offering, $10.15 per unit sold to the public in this offering (whether or not the over-allotment option has been exercised in full or part) will be deposited into a United States-based trust account with Continental Stock Transfer & Trust Company acting as trustee. Except as described in this prospectus, these funds will not be released to us until the earlier of (1) the completion of our initial business combination within the required time period; (2) our redemption of 100% of the outstanding public shares if we have not completed an initial business combination in the required time period; and (3) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption rights as described herein or redeem 100% of our public shares if we do not complete our initial business combination within the required time period or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity. The underwriters are offering the units on a firm commitment basis. The underwriters expect to deliver the units to purchasers on or about , 2022. Joint Book-Running Managers Ladenburg Thalmann Brookline Capital Markets a division of Arcadia Securities, LLC , 2022 Table of Contents forfeiture of shares, and all references to forfeiture of shares, described in this prospectus shall take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. All references in this prospectus to our shares being forfeited shall take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. All references in this prospectus to share dividends shall take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not, and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted. General We are a blank check company incorporated as a Cayman Islands exempted company on May 4, 2021. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government providing that, in accordance with section 6 of the Tax Concessions Act (Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We were incorporated for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities, which we refer to as a target business. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location, although we currently intend to focus our efforts in Asia (excluding China) with an emphasis on sourcing opportunities that are in the healthcare, consumer technology and technology, media and telecommunications ( TMT ) industries. We will not undertake an initial business combination with any entity that is based or located in or that conducts its principal business operations in China (including Hong Kong and Macau). Since certain of our officers and directors have significant ties to, and business experience in, mainland China and Hong Kong, not being able to target a business in China (including Hong Kong and Macau) may make it more difficult to find an attractive target business, and it may make us a less attractive partner to certain potential non-China- or non-Hong Kong-based target businesses. Even if we can locate an appropriate candidate for our business combination, we may not be able to enter into a business combination agreement that is in our favor if our officers and directors are unfamiliar with the markets outside of China and due to the limited business combination period. These risks could significantly and negatively impact our search for a target business and/or the value of the securities we are registering for sale. We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction with our company. Our executive offices are currently located in Singapore. In addition, all of our executive officers and directors are located outside of the United States. As a result, it may be difficult for investors to effect service of Table of Contents process within the United States on our company and our executive officers and directors, or enforce judgments obtained in the United States courts against our company and our executive officers and directors, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. Although our offices are located in Singapore, certain of our directors and officers have significant ties to mainland China and Hong Kong and a majority of our directors and officers are currently located in Hong Kong. As a result, we may be subject to certain risks relating to regulatory oversight by the PRC government. In particular, changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be adopted quickly with little advance notice. The Chinese government may also intervene or influence our search for a target business or the completion of an initial business combination at any time because certain of our directors and officers have significant ties to mainland China and Hong Kong. This could significantly and negatively impact our search for a target business and/or the value of the securities we are registering for sale. Since we are a Cayman Islands company with offices in Singapore and have no operations in China and all our directors and officers are based outside of mainland China, we are not required to obtain permission from the China Securities Regulatory Commission (CSRC), Cyberspace Administration of China (CAC) or any other governmental agency in China for our offering. Moreover, our officers and directors are not covered by any Chinese permissions requirements since none of them is a citizen of or based in mainland China. Only Winnie Wai Yu Wong, our Chief Financial Officer and director, is a permanent resident of and based in Hong Kong. Although each of Sung June Hwang (our Chief Executive Officer and director), Michael James Connolly Hogan (our independent director) and Victoria Hoi Ying Lau (our independent director) currently maintains a place of residence in Hong Kong, they are permanent residents of countries other than China (including Hong Kong and Macau) and may from time to time split their time between Hong Kong and other countries like South Korea and Singapore for work. Chul Yung Kim (our independent director) is a permanent resident of South Korea and is based in Singapore. Although a majority of our directors and officers are currently located in Hong Kong, we believe that maintaining a place of residence in Hong Kong will not subject our directors and officers to any permission requirements from Chinese authorities in connection with this offering because they are not citizens of China. Hong Kong is a Special Administrative Region of China, having its own governmental and legal system that is independent from mainland China, and as a result has its own distinct rules and regulations. To the best of our directors and officers knowledge, they are not required to obtain permission from any Hong Kong authorities in connection with this offering. Accordingly, as of the date of this prospectus, we have not applied or received any permission or approvals for this offering. However, it is uncertain whether in the future the Hong Kong government will implement regulations and policies of the Chinese government or adopt regulations and policies of its own that are substantially similar to those of the Chinese government. Moreover, given that changes in policies, regulations, rules, and the enforcement of laws of the Chinese government may occur quickly with little advance notice, it is also uncertain whether having a majority of directors and officers located in Hong Kong will subject us to the oversight of the Chinese authorities in the future. Therefore, the legal and operational risks associated with operating in China may also apply to operations in Hong Kong. If (1) we and our officers and directors inadvertently conclude that such permissions or approvals are not required, or (2) applicable laws, regulations, or interpretations change and require us and/or our directors and officers to obtain such permissions or approvals in the future, and we and/or our officers and directors are unable to obtain such permissions and approvals, these regulatory agencies (a) may impose fines and penalties on our officers and directors and (b) may also take actions requiring our directors and officers, or making it advisable for directors and officers, to terminate this offering before settlement and delivery of our units or delay our potential business combination and therefore, we may have to liquidate the funds held in the trust account (in which case our warrants and rights may be worthless). Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on the trading price of our securities. Table of Contents Industry Opportunities Our objectives are to generate compelling attractive returns for our shareholders and to enhance value through top line growth and hands-on operational improvement for our potential target company. We intend to capitalize on our management team s network and relationships combined with their unique and diversified experiences in investing, operating and transforming businesses in both private and public markets, which will uniquely position them to identify and execute attractive business combination opportunities. While we may identify a prospective target business in any industry or sector, we intend to focus our search in the following high-growth sectors across Asia: Healthcare: all types of healthcare, including consumer healthtech (technology-enabled healthcare services that can be delivered or consumed remotely) and medtech (medical devices and technologies for in-hospital treatment and diagnostics); Technology, media and telecommunications (TMT): all types of new technologies, media platforms and networks, applications, systems, and the software and hardware infrastructure and research and development that enable the interoperability of these technologies; Consumer technology: all types of high-demand products and services for the end user that utilize digitalization and/or platform business models that integrate cloud, social media and mobile technologies to facilitate an interactive business ecosystem. We believe each of these markets has considerable growth potential. For example: Healthcare The ongoing COVID-19 pandemic has driven consumer expectations and advanced technologies to disrupt global healthcare in 2021 and beyond. The past year has especially accelerated adoption and mainstreaming of healthcare technology (healthtech) and digitalization in healthcare delivery, diagnostics and treatments. The consumer healthcare market was valued at approximately $340.03 billion in 2021 and is expected to reach $520.32 billion by 2027, growing at a compound annual growth rate (CAGR) of 7.28% from 2020 to 2027, according to a January 2022 360iResearch report. Reflecting this trend, 2021 closed as the most-funded year to date with $29.1 billion raised over 729 deals in US digital health funding (compared to the $14.9 billion raised over 482 deals in 2020), according to a January 2022 Rock Health report. Deal sizes averaged $39.9 million (compared to $30.8 million in 2020), and SPACs continued to offer an alternative path to liquidity from traditional IPOs, with 23 digital health SPAC deals in 2021 (almost triple the previous record of 8 SPAC mergers in 2020). Many investors, including corporate venture capital groups, see the post-pandemic era as the beginning of a multiyear opportunity rather than a bubble, as virtual health is expected to become a norm even when in-person visits fully resume. While North American and European markets are still a significant focus for many investors, Asia is expected to be a promising ground for digital healthcare as well. Digital healthcare in the Asia Pacific ( APAC ) region is growing rapidly due to the burgeoning aging population and to governments in countries like Indonesia, Malaysia and Singapore acting as intermediaries or providing support to connect telehealth operators and consumers. The medical technology (medtech) market in APAC is projected to reach $150 billion in 2022 with a 9% annual growth rate, according to December 2020 insights from APACMed and Deloitte. However, the pandemic has highlighted that there is still much inefficiency in as well as limited access to healthcare in this region. Given that APAC has the largest patient population with chronic diseases in the world, we believe there is a vast number of opportunities for innovators and investors to step into the consumer digital health space in this region. Table of Contents Technology, Media and Telecommunications The COVID-19 pandemic has driven exponential digitalization across industries, including the TMT sector globally. While traditional media industries have been severely impacted by the closure of cinemas, theatres and performance venues, digital media is witnessing high growth. The Media Global Market Report published in January 2021 by The Business Research Company estimated the global media market would reach a value of approximately $1,850 billion in 2021 and is expected to grow rapidly to $2,670 billion in 2025. Technologies such as 5G are expected to fuel growth, contributing a $93 billion boost to Asia and Oceania consumer and media sector by 2030, according to a 2020 PwC estimate. Although there was a global decline in the telecom sector from 2019 to 2020, TMT management consulting company Analysys Mason predicts that 2022 will see the start of a two-year spike in 5G-related investments, with a cumulative $990 billion in capital expenditure by 2027. We believe there are many TMT investment opportunities in the APAC region. A 2019 World Bank report shows countries such as the Philippines and Indonesia are in the top ten globally for time spent on social media, with internet users from seven APAC countries spending more time on social media than those in the US, according to a January 2022 Data Reportal report. The report states that of the time users spend on the internet, an average of 35% of the time is spent on social media apps. The same report states that mobile phones are now the first screen that most of the world population has contact with, with 92.1% of the world s users accessing the internet via mobile phones. Consumer Technology Consumer technology industries such as telehealth, mobile payments and banking services, food-delivery services and subscription video-on-demand services have recently grown dramatically in Asia. Although adoption of consumer technology has been driven by strict lockdown measures in many Asian countries, it is expected that this usage will become a norm even post-pandemic. For example, in the Philippines, fintech provided millions of unbanked individuals in the region access to government aid during the pandemic, and The Philippine Star reported in June 2020 that there are now more than double the number of money touchpoints than traditional bank branches nationwide. Southeast Asia has seen a rise of the super app in recent years, where consumers can get food delivery, ride-hailing, book services and make mobile payments all in one app. Though this is not a new concept, the APAC region has been especially receptive to it, as much of its population s first internet experience is through mobile phones and many do not have access to bank accounts. Fintech companies based in Singapore raised about S$656 million (or about $492.9 million) in the first quarter of 2021, up by 355% from the first quarter of 2020, with funding having grown at a rate of about 47% from 2016 to 2020, according to a May 2021 Straits Time article. Findexable states that Singapore is ranked 4th in the Global Fintech Index 2021 (after the U.S. and the U.K., with Australia in 6th place), and in 2020 it was the first country in Southeast Asia to issue digital banking licenses. Indonesia s digital economy is also projected to grow in gross market value from $70 billion in 2021 to $330 billion by 2030 due to the emergence of several local consumer tech unicorns (i.e. typically startups with at least $1 billion valuation) and proliferation of digital merchants in recent years, according to a 2021 Google, Temasek and Bain study. Analysis by the World Economic Forum suggests that fintech is crucial for the survival of Southeast Asia ( SEA ) micro, small and medium enterprises (MSMEs) which account for 52%-97% of employment in the region and that SEA is on the cusp of a technology-driven consumption boom. Table of Contents Business Strategy Our acquisition and value creation strategy is to leverage our management team s expertise, network and operational experience to identify and complete our initial business combination with a growth focused, leading company in its industry. We are seeking a company with characteristics that will complement and benefit our management team s skills to deliver shareholder value. We believe our team s knowledge will drive many investment opportunities and their experience will increase operational efficiencies for the target company. Our management team comes from a diversified and international background. For example, Sung June Hwang, our Chief Executive Officer, is a Korean national with experience in the financial industry across the Asia Pacific market; Winnie Wai Yu Wong, our Chief Financial Officer, has experience in private equity across Asia, Europe and the U.S.; our independent director, Michael James Connolly Hogan, has over 30 years of experience as an international banker and has lived and worked in Asia, Australia, the Middle East, the US and the UK; our independent director Kim Chul Young, who is also a Korean national, has 15 years of investment banking experience in originating and executing cross-border mergers and acquisitions in the APAC region with a particular focus on technology and the Internet; and our independent director Victoria Hoi Ying Lau has spent over a decade in investment banking and finance in a leadership role for numerous M&A and financing transactions. Our management team has a unique combination of experience and skills that we believe will greatly enhance the likelihood for success: Deep network and relationships with management teams of public and private companies, private equity sponsors, other public investors, entrepreneurs, investors, auditors, legal offices and companies to source an ideal target; Growth-accelerating expertise; Ability to leverage their experience in operations, risk management, compliance, business strategy, corporate governance, financial forecasting and fostering relationships with investors; Transactional experience including restructuring capabilities, pre-IPO Investments, conducting rigorous due diligence and executing transactions; Strength in selecting top-notch talents and managing multiple teams across geographies; and Strong M&A experience. In addition, members of our team have decades working in some of the largest financial institutions and companies in the APAC region, such as our CEO Mr. Hwang who was previously with Credit Suisse and Samsung Securities, and our independent director Mr. Kim who is with Grab Holdings Inc. We intend to capitalize on their insider knowledge of the industries we will be focusing on. We will also leverage the networks and experience of or our advisors in searching for a target for our business combination and also during the business combination process Mr. Derek Lim was previously with CIMB Investment Bank Berhad and has over 20 years of experience in investment banking, private and public market investing focused on South East Asia, Mr. Jason Kon Man Wong is a seasoned SPAC professional having sponsored or been in the management team of multiple SPACs since 2014; and Mr. Patrick A. Sturgeon, being a Managing Director of Brookline Capital Markets, has extensive experience in initial public offerings of SPACs and de-SPAC transactions. We intend to deploy a strategy focusing on companies that we believe have the capability to grow. We are looking for a target with a management team that, when combined with ours, will be able to accelerate growth and enhance performance in the public markets. After the completion of this offering, our team will immediately commence looking for potential opportunities by reaching out to their networks. Our selection process will be very rigorous and we will conduct extensive due diligence to ensure we identify acquisition opportunities that will lead to shareholder value creation. Table of Contents Acquisition Strategy and Investment Criteria Consistent with our business strategy, we have identified a list of guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria in evaluating acquisition opportunities, but we may decide to enter into a business combination with a target business that does not meet these guidelines. We intend to acquire a company with the following characteristics: Strong competitive position in the market We will analyze the strengths of the target company in comparison to their competitors and we intend to choose a target company that has demonstrated strengths in the market. The company should have qualities that are hard to replicate and will allow it to potentially disrupt incumbents in its market, preventing new competitors from entering. Established companies with proven record of generating recurring revenue We seek to acquire a company that has the potential for, or history of, strong cash flow generation. We want to select a firm that has an attractive and scalable business model with a predictable revenue stream. Motivated and experienced management team We seek a company with a leadership team that has a track record of creating shareholder value, driving profitability and improving operating margins in the firm. This management team should be passionate about their products and services and willing to work together with us to enhance value creation. Has unrecognized value or characteristics based on our analysis that the market has not yet recognized We will try to identify a firm that has the potential to have significant growth from underexploited characteristics and opportunities as they enter new markets. We would then look for new potential drivers of revenue for the company. Well prepared to become a publicly-traded company We intend to select a company that is ready to operate efficiently and effectively in the public markets in the U.S. and across Asia (excluding China). We plan to focus on companies which are based in Southeast Asia, where we have a strong presence from our board and advisors. Growth-oriented company We seek a target that has a clear growth strategy and is focused on building its presence across APAC (excluding China) by penetrating into new markets and growing their customer base. We are seeking firms that will benefit from receiving additional capital to achieve their company s growth strategy. The criteria listed above are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based on the above, but may also include other factors and criteria that our management team deems relevant. Our Management Team Sung June Hwang is our Chief Executive Officer and director. Mr. Hwang, a Korean national, has spent nearly 25 years working in the financial industry in top executive positions across the APAC market. Most Table of Contents notably, he has spent a significant portion of his career working at Credit Suisse, one of the leading investment banking companies in the world. He has been the chief executive officer for Atlas Investment Management Ltd., a private equity firm that provides Asian investors access to developed markets in Europe and North America and to emerging markets in Southeast Asia and India, since June 2019. Prior to this role he spent seven years from August 2012 to April 2019, working at Credit Suisse Private Banking, as Head of APAC Products and Solutions. In this role, he directly oversaw the firm s entire range of products and services geared to pan Asian clients including mutual funds and exchange-traded funds, sales and trading for equities, fixed income, structured products and foreign exchange, wealth planning including trust, philanthropy and the family office, strategic advisory and private assets and alternatives including hedge funds, private equity and real estate. He also acted as alternative chief executive of the Hong Kong branch of Credit Suisse Group, overseeing risk control and governance functions for products and solutions from July 2013 to April 2019. From August 2010 to July 2012, Mr. Hwang was the chief executive officer & global head of equities for Samsung Securities (Asia) Ltd, affiliated with one of Korea s leading firms Samsung, where he managed all the platforms in Hong Kong, Singapore and Korea. Before joining Samsung Securities, he worked at Credit Suisse for 16 years from July 1994 to May 2010. Some of the positions he held included APAC Head of Institutional Sales, where he was responsible for distributing equity products across Asia and was the senior relationship manager to many renowned companies including HSBC, GIC and Tudor. He was also previously co-head of non-Asia equities, head of non-Japan Asia cash equities and regional head of research for non-Japan Asia where he managed local research teams in Taiwan, Thailand, Malaysia, India, Indonesia, South Korea, Hong Kong and Singapore. Mr. Hwang is credited with being a key driving force and early architect in the establishment and growth of the firm s equity onshore presence across APAC and in particular India and the Southeast Asian markets Singapore, Malaysia, Thailand and Indonesia. Throughout his career, Mr. Hwang has established a deep and wide professional network of corporates, family offices and entrepreneurs across Asia. Winnie Wai Yu Wong, our Chief Financial Officer and director, has close to two decades of experience in corporate strategies, funds management, private equity and investment banking. Since March 2022, Ms. Wong has been the chief of staff at Pickupp Limited, a multinational technology-enabled delivery platform, where she is responsible for overseeing overall company operations and strategic business initiatives. Prior to this role, she was the chief financial officer and one of the founding employees of We Doctor Greater Bay Area Limited from November 2018 to April 2020, focusing on digitalizing healthcare services in the Greater Bay Area and Southeast Asia. In addition, she was responsible for the capital markets strategy, strategic investments and financial reporting of the company. From July 2017 to November 2018, she was a director and portfolio manager at Harvest Global Investments Ltd., focused on investing in Asian assets and had a strong track record managing funds that were rated Morningstar five-star. From June 2009 to November 2016, Ms. Wong was a director and portfolio manager at the Royal Bank of Canada proprietary investment unit, where she managed an investment portfolio of Asian equity and equity linked products. She was an investment associate at Warburg Pincus from August 2008 to February 2009 and corporate finance analyst at Credit Suisse from February 2005 to August 2008, where she led the execution of several mergers and financing transactions. Michael James Connolly Hogan, one of our independent directors, has over 30 years of experience as an international banker and has lived and worked in Asia, Australia, the Middle East, US and UK. Over this period, he has accumulated considerable experience in strategic planning and execution, risk management and corporate governance. He was an independent director of SinoMab BioScience Limited, a biopharmaceutical company focused on therapeutics for the treatment of immunological diseases, from October 2019 to June 2021, where he was closely involved in the company s initial public offering. He has also been an investor in and strategic advisor to fintech start-up Moo-Lah Technologies Private Limited since April 2020, which operates a digital embedded savings platform in India. Mr. Hogan had a multinational career with HSBC from September 1987 to July 2019. In August 2016, he was appointed as the Asia Pacific regional chief operating officer for its commercial banking business. In this role, Mr. Hogan was responsible for digital transformation and technology change as well as overseeing risk management, product control, and strategic implementation across 19 countries Table of Contents in Asia Pacific. Prior to that, from September 2011 to July 2016, he was the country head for commercial banking, Australia, where he designed and successfully executed a multi-segment wholesale growth strategy, doubling profitability and reinforcing HSBC s position as the country s leading international bank while actively supporting mid-market sponsor and private equity opportunities. Before that, he was the chief executive officer for HSBC Iraq from September 2009 to September 2011, where he successfully upgraded the operating and technology platform to improve customer service and profitability, while working closely with various governments and officials from the Central Bank of Iraq (CBI) to champion new banking and capital markets regulations. His earlier roles in HSBC between September 1987 and September 2009 included being the North America regional head of trade and receivables when he was based in New York and global head of custody and clearing for HSBC Securities Services in Hong Kong. He has served as a board director of the Australian Chamber of Commerce in Hong Kong since March 2021 and as the chair of its Finance, Legal & Tax Committee since June 2020. Chul Young Kim, one of our independent directors, has 15 years of investment banking experience in originating and executing cross-border mergers and acquisitions in the APAC region with a particular focus on technology and the Internet. Since April 2019, Mr. Kim has been head of fundraising at Grab Holdings Inc., Southeast Asia s leading super app and largest consumer technology company, where he is responsible for fundraising and strategic partnerships. Mr. Kim s most recent achievements include the $40 billion merger of Grab Holdings Limited with Altimeter Growth Corp, as well as the closing of series A fundraising for Grab Financial Group of over US$300 million. Prior to Grab Holdings Inc., he was a director at Citigroup from June 2010 to March 2019, where he played an integral role in the APAC mergers and acquisitions team with the coverage responsibility of technology sector and private equity clients in the region. Some of his most recent M&A transactions with Citigroup include a $1.1 billion strategic divestment of three verticals by Li & Fung Limited to the Fung family and Hony Capital, a take-private of Singapore-listed Global Logistics Properties for $18 billion; and a take-private of NYSE-listed Trina Solar by the chairman for $2.4 billion. Prior to Citigroup, Mr. Kim was an associate at Nomura Securities from October 2008 to May 2010 and at Lehman Brothers from September 2007 to September 2008, where he was a key member of Lehman Brothers M&A Group that ranked first in the 2008 Asia-Pacific M&A league table. He continued to help build the franchise following Nomura s acquisition of Lehman Brothers operations in Asia and Europe. He started his investment banking career at Credit Suisse in April 2004. Victoria Hoi Ying Lau, one of our independent directors, has spent over a decade in investment banking and finance leading execution of M&A and financing transactions. Ms. Lau has been chief administrative officer at Pickupp Limited, a multinational technology-enabled delivery platform, since November 2017, working closely with legal and compliance partners to ensure the business complies with statutory requirements while overseeing more than 180 employees across five Asian countries. Prior to this, she was at Bank of America Merrill Lynch for over ten years, where she was first an analyst, then a responsible officer and director of investment banking from April 2007 to July 2015, and subsequently a director reporting to the chief operating office for Asia-Pacific investment banking from July 2015 to May 2017. In her former roles with the Bank of America Merrill Lynch, she led the execution for several large financing transactions including the NASDAQ common stock offering of JD.com. Before her career with Bank of America Merrill Lynch, she was a corporate finance analyst at Credit Suisse from March 2004 to March 2007. The past performance of our management team or of their affiliates is not a guarantee either (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of our management team s or their affiliates performance as indicative of our future performance. Table of Contents Our Strategic Advisors Derek Lim is one of our strategic advisors. Mr. Lim is based in Singapore and has over 20 years of experience in investment banking, private and public market investing focused on South East Asia. He is the chief investment officer and executive director of First Eagle Capital Management Pte Ltd ( FECM ), a Singapore-based investment firm focused on private equity and direct investments in South East Asia. Prior to FECM, Mr Lim was a Managing Director and head of equity capital markets at CIMB Investment Bank Berhad, one of the largest financial institutions in Malaysia and South East Asia focused on investment banking and capital markets. He was a member of CIMB s investment banking committee and CIMB s underwriting risk committee. Mr. Lim worked at Citigroup prior to joining CIMB. He holds a Bachelor of Arts from Yale University. Jason Kon Man Wong, one of our strategic advisors, has over twenty-five years of experience in fund management and capital markets investment experience in Asia Pacific. He is also a seasoned SPAC professional, having sponsored or been in the management team of multiple SPACs since 2014. Mr. Wong is chairman and CEO of Norwich Investment Limited, which sponsored NASDAQ-listed SPAC Tottenham Acquisition I Limited, that later merged with Clene Nanomedicine, Inc. in December 2020. He is also the CEO of Ace Global Investment Limited, which sponsored Ace Global Acquisition Limited, a SPAC which listed on NASDAQ in April 2021. Mr. Wong currently also serves as independent director to two companies listed in Hong Kong Shinsun Holdings (Group) Co Ltd (HKEX:2599) and Bamboos Health Care Holdings Ltd (HKEX:2293). He is a founding partner and investment committee member of both Whiz Partners Asia Limited, a private equity fund dedicated to investing in small to medium sized technology companies in Japan and other Asian countries, as well as the Sony China Hero Fund, the first console (PS4, PSVR) game fund in China. Mr. Wong is also the Managing Director of Fortune Capital Group Limited, a venture capital management company. Patrick A. Sturgeon, one of our strategic advisors, has nearly two decades of experience with M&A and equity capital market transactions in the healthcare and other sectors. He has served as a Managing Partner at Brookline Capital Markets, a division of Arcadia Securities, LLC, or Brookline, since March 2016. At Brookline, Mr. Sturgeon focuses on mergers and acquisitions, public financing, private capital raising, secondary offerings, and capital markets. On the public financing front, he focuses on SPAC transactions, primarily underwritten initial public offerings and initial business combinations. He is the chief financial officer for Alpha Healthcare Acquisition Corp. III, a Nasdaq-listed special purpose acquisition company which raised $154.0 million in its public offering in July 2021. Mr. Sturgeon also serves as chief financial officer of Brookline Capital Acquisition Corp., a Nasdaq-listed special purpose acquisition company which raised $57.5 million in its initial public offering in January 2021. In addition, Mr. Sturgeon is a managing partner of Covenant Venture Capital, LLC, a fund focused on investing in private emerging growth companies. From July 2013 to February 2016, Mr. Sturgeon served as a managing director at Axiom Capital Management. He worked at Freeman & Co. from October 2002 to November 2011, where he focused on mergers and acquisitions in the financial services sector. Mr. Sturgeon received his B.S. in Economics from the University of Massachusetts, Amherst and his M.B.A. in Finance from New York University. We currently expect our strategic advisors to (i) assist us in sourcing and negotiating with potential business combination targets, (ii) provide business insights when we assess potential business combination targets and (iii) upon our request, provide business insights as we work to create additional value in the businesses that we acquire. In this regard, our advisors may fulfill some of the same functions as our board members. However, our advisors are not executive officers of our company and do not have any other employment arrangements with us. Moreover, our advisors will not be under any fiduciary obligation to us nor will they perform board or committee functions, nor will they have any voting or decision-making capacity on our behalf. Our advisors will not be required to devote any specific amount of time to our efforts or be subject to the fiduciary requirements to which our board members are subject. Accordingly, if our advisors become aware of a business combination Table of Contents opportunity which is suitable for any of the entities to which they have fiduciary or contractual obligations, they will honor their fiduciary or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity. We may modify or expand our roster of advisors as we source potential business combination targets or create value in businesses that we may acquire. Initial Business Combination We will have until 15 months from the closing of this offering to consummate our initial business combination. If we anticipate that we may not be able to consummate our initial business combination within 15 months, we may, but are not obligated to, extend the period of time to consummate a business combination two times by an additional three months each time (for a total of up to 21 months to complete a business combination). Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our insiders or their affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three month extension $1,100,000, or $1,265,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. If we are unable to consummate our initial business combination within the time period described above, we will, as promptly as reasonably possible but not more than five business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the warrants will be worthless. Nasdaq rules provide that our initial business combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the trust account (less deferred commissions and any taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions with respect to the satisfaction of such criteria. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses. If our securities are not listed on Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Nasdaq at the time of our initial business combination. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act . Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority Table of Contents interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity securities of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions that our initial business combination is fair to our company (or shareholders) from a financial point of view. Members of our management team and our independent directors and their affiliates will directly or indirectly own ordinary shares and private warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have, additional, fiduciary or contractual obligations to another entity, including other blank check companies similar to our company, pursuant to which such officer or director may be required to present a business combination opportunity to such entity. Specifically, our executive officers are affiliated with our sponsor and other entities that make, or are looking to make, investments in companies. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has a fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity. We do not believe, however, that the fiduciary duties or contractual obligations of our executive officers will materially affect our ability to complete our business combination. For additional information regarding our executive officers and directors business affiliations and potential conflicts of interest, see Management Directors and Executive Officers and Management Conflicts of Interest. Our amended and restated memorandum and articles of association will provide that, subject to fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. Private Placements Prior to this offering, we issued an aggregate of 3,162,500 founder shares (up to 412,500 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised) to our initial shareholders for an aggregate purchase price of $25,000, or approximately $0.008 per share. None of our initial shareholders has indicated any intention to purchase units in this offering. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell their founder shares (except to certain permitted transferees) until six months after the date of the consummation of our initial business combination or earlier if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. Any permitted transferees will be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Table of Contents Our initial shareholders have agreed to purchase an aggregate of 5,850,000 warrants (or 6,427,500 warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant for an aggregate purchase price of $5,850,000 (or 6,427,500 if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell any of the private warrants and underlying Class A ordinary shares until after the completion of our initial business combination. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor internal controls attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company for up to five years. However, if our non-convertible debt issued within a three year period or revenues exceeds $1.07 billion, or the market value of our shares that are held by non-affiliates exceeds $700 million on the last day of the second fiscal quarter of any given fiscal year, we would cease to be an emerging growth company as of the following fiscal year. Our executive offices are located at Level 42, Suntec Tower Three, 8 Temasek Boulevard, Singapore S038988, and our telephone number is +65 68293301. Table of Contents
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus that we consider important. This summary does not contain all of the information you should consider before investing in our Common Shares. You should read this summary together with the entire prospectus, including the risks related to our business, our industry, investing in our Common Shares and our location in British Columbia, Canada, that we describe under Risk Factors and our consolidated financial statements and the related notes before making an investment in our securities. Overview The Company is an emerging plant-based food technology company that develops, produces, distributes and sells a variety of plant-based meat and cheese products under its brands The Very Good Butchers and The Very Good Cheese Co. As of June 27, 2022, the Company s product portfolio consisted of 24 products: 19 products developed under The Very Good Butchers brand and five products developed under The Very Good Cheese Co. brand. The Very Good Butchers brand includes the Company s premium gluten-free, soy-free and Non-GMO verified line of sausages, burgers and meatballs marketed under the Butcher s Select label. Following its recent corporate strategic shift to focus on sustainable growth and a path to profitability, the Company is currently consolidating its operations into its leased production facility located in Vancouver, British Columbia, known as the Rupert Facility, and is ceasing operations at its production facilities located in Victoria, British Columbia and Patterson, California. To further right size the organization, the Company has significantly lowered headcounts across all departments and implemented initiatives such as pausing non-critical capital expenditures and lowering general and administrative expenses. The Company currently distributes and sells its products in all Canadian provinces and territories and in 50 states in the United States through large and small retailers including, in Canada, Whole Foods Markets Canada, Thrifty Foods (Sobeys), Save-On-Foods, Fresh St. Market, Choices Markets, IGA, and in the United States, Wegmans, Harmon s, PCC, Earth Fare, Erewhon and Metro Markets. Historically the Company s three main revenue channels have been eCommerce, wholesale and its butcher shop and restaurant located in Victoria, British Columbia. Pursuant to its re-focused strategy, the Company is diverting from its eCommerce and the restaurant channels to prioritize wholesale and build a presence in the food service market. Corporate Information The Company was incorporated on December 27, 2016, under the laws of the province of British Columbia, Canada under its original name The Very Good Butchers Inc. The Company changed its legal name to The Very Good Food Company Inc. on October 1, 2019. The Company s head office is located at 2748 Rupert Street, Vancouver, BC, V5M 3T7 and its registered and records office is located at 800 885 West Georgia Street, Vancouver, BC, V6C 3H1. The Company s telephone number is (855) 526-9254. The SEC maintains an Internet site (http://www.sec.gov) that makes available reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The Company s website can be found at www.verygoodfood.com. The information on the Company s website does not constitute part of this prospectus. Recent Developments Refocused Strategy In May 2022, we announced our refocused strategy to focus on sustainable growth and a path to profitability. The strategy has consisted of a three-prong approach to (1) Stabilize, (2) Right-Size, and (3) Table of Contents Optimize. The Stabilization prong focused on obtaining capital that would enable the Company to focus on the other two prongs. The Right-Size prong is nearing completion with the consolidation of production facilities into the Rupert Facility located in Vancouver, BC in June 2022 and the closure of the Company s restaurant and butcher operations. The Optimization prong remains ongoing and has included: significantly lowering production to manage inventory levels; a pause in non-critical capital expenditures; a reduction in general and administrative expenses; a strategic shift away from our eCommerce channel toward wholesale and food service; and the decision not to proceed with the flagship restaurant and butcher shop planned to be opened in Vancouver, BC. Lower production and the consolidation of facilities has resulted in the closure of our plants in Victoria, BC and Patterson, California. These closures, along with general workforce optimizations undertaken since March 2022, have resulted in an overall reduction in headcount to 89 regular full-time employees and part-time employees as at August 31, 2022 compared to 271 regular full-time employees and part-time employees as at December 31, 2021. While we believe that we have adequately managed our workforce reductions, they may ultimately yield unanticipated consequences, including attrition beyond planned reductions. As part of our shift away from eCommerce, we reduced the deployment of targeted marketing tools to decrease customer acquisition costs, which contributed to a decrease in revenue from the channel for the six months ended June 30, 2022, of $2,929,170 (67%) compared to the same period in 2021, offset by an increase of $959,237 in wholesale revenue. Supply Chain Impacts Along with business globally, we are subject to disruption and inflationary pressures in our supply chain. Since December 31, 2021, we have experienced price increases of raw materials and higher freight costs, which collectively have increased our cost of goods sold. This increase in cost of goods sold has in part been offset by an overall reduction in our production throughput during the six-month period ended June 30, 2022, and our ability to draw on our inventory reserves of core raw materials. However, as we return to regular purchasing of raw materials, we expect to encounter increased costs for the raw materials and challenges in obtaining the raw materials. Nonetheless, as many of our product inputs are readily available in the market from a variety of suppliers, and we manage supply with forecasts and advance purchase orders to suppliers, we currently expect to be able to mitigate any adverse market conditions. If we are not able to source the necessary raw materials in a timely manner or at all, we will be required to reduce or halt production of one or more of our products. This in turn could threaten our ability to meet customer demands and have an adverse effect on our business. In addition, in February 2022, a full-scale military invasion of Ukraine by Russian troops was reported. Although the length and impact of the ongoing military conflict is highly unpredictable, the conflict in Ukraine has affected the availability and cost of certain raw materials which has led to general price increases. COVID-19 has also had, and continues to have, a significant effect on global supply chains with port congestion, shortage of freight equipment and high freight rates, among other factors, contributing to significant instability in supply and transport. In addition, many of the raw materials in our products, such as vegetables, beans, peas used for pea protein, and vital wheat gluten derived from wheat flour, are vulnerable to adverse weather conditions and natural disasters, such as floods, droughts, frosts, earthquakes, hurricanes and pestilence. Adverse weather conditions and natural disasters can lower crop yields and reduce crop size and quality, which in turn could reduce the available supply of, or increase the price of quality ingredients. Seasonality also affects supply of our ingredients and we must align our supply contracts with crop cycles to secure sufficient product through the next harvest. If we are unable to secure such agreements for the supply of the necessary ingredients in sufficient quantities at competitive prices, or at all, this could negatively affect our Table of Contents production capacity and ability to meet demand for our products. Similarly, suppliers with whom we do not have any written agreements, could seek to alter or terminate their relationship with us at any time, which could result in disruption to our supply chain. If we are not able to source the necessary raw materials from other suppliers in a timely manner or at all, we may experience ingredient shortages which may require us to reduce or halt production of one or more of our products and threaten our ability to meet customer demands which could have an adverse effect on our business, results of operations and financial condition. We also compete with other food producers in the procurement of ingredients, and as consumer demand for plant-based protein products increases, this competition may increase. Moreover, we strive to use organic ingredients which are more limited in supply than conventional product ingredients. If supplies of quality ingredients are reduced or there is greater demand for such ingredients, we may not be able to obtain sufficient supply on favourable terms, or at all, which could impact our ability to supply products to our customers and may adversely affect our business, results of operations and financial condition. In addition to ingredients, we also purchase significant amounts of packaging for our products. Price fluctuations in our key ingredients and packaging supplies could increase our cost of goods sold and we may not be able to implement product price increases to cover any increased costs, or any price increases implemented may result in lower sales volumes. If we are not successful in managing our raw material costs, and unable to increase our prices to cover increased costs or if such price increases reduce sales volumes, then such increases in costs will adversely affect our business, results of operations and financial condition. We are continuing to monitor the conflict between Russia and Ukraine and assessing its potential impact on our business and cybersecurity issues related thereto. Although our operations have not experienced material and adverse impact on supply chain issues related to cybersecurity, there is no assurance that such conflict would not develop or escalate in a way that could materially and adversely affect our business, financial condition, and results of operations in the future. Review of Strategic Alternatives On September 8, 2022, we announced that we have initiated a process to evaluate potential strategic alternatives to maximize shareholder value, which could include the acquisition by, or a merger with, an industry partner involving all or part of the Company s business or assets. Board & Management Since December 31, 2021, there have been a number of changes in our senior management team. On April 1, 2022, Mitchell Scott s employment as CEO was terminated. Also effective April 1, 2022, James Davison resigned as the Company s Chief Research & Development Officer and as a member of the board of directors. Subsequent thereto, on April 22, 2022, Ana Silva resigned as President, Interim CFO and Interim Corporate Secretary. On April 14, 2022, the Company announced that Jordan Rogers, who was formerly our head of Canadian retail sales, was being promoted to Chief Commercial Officer. Mr. Rogers joined the Company as part of its acquisition of the Lloyd-James Marketing Group Inc. and has over 14 years of consumer-packaged goods experience, with the last seven as CEO of North America s first plant-based sales and marketing agency. Mr. Rogers served on the Executive Committee formed by the Company to review and approve key organizational, financial, operational and strategic decisions for the Company, by drawing upon the collective knowledge, experience, business acumen and skills of the senior management team, while the search for a new Chief Executive Officer was underway. The other members of the Executive Committee included Parimal Rana, the Company s then Vice-President of Operations and Kevin Callaghan, the Company s former Vice President of Sales North America. Table of Contents On April 25, 2022, the Company announced that Matthew Hall, a leading plant-based food technology company, was joining the Company as interim Chief Executive Officer and would also be a member of the Company s board of directors. On May 16, 2022, Dela Salem, a director of the Company, was appointed interim Co-Chief Executive Officer to assist Mr. Hall, interim CEO, with certain administrative aspects of the role and to assist with the Company s management transitions, given Matthew Halls short tenure at the Company. On July 4, 2002, the Company announced that as part of its succession plan, (i) Mr. Hall was stepping down as interim Co-Chief Executive Officer and as a director of the Company but would continue to support the Company in an advisory capacity, and (ii) Ms. Salem was also stepping down from her role as interim Co-Chief Executive Officer and would return her focus solely to service as a member of the Company s board of directors. On that same day, the Company announced that Parimal Rana, a seasoned food industry professional and the Company s Vice President of Operations, was assuming the role of Chief Executive Officer and would also join the Company s board of directors. On July 12, 2022, the Company announced Pratik Patel, CPA, CGA, as the Company s Chief Financial Officer. Mr. Patel has over fifteen years of experience as a senior accounting and finance professional. Prior to joining VERY GOOD, Pratik was Head of Finance at Bardel Entertainment, a Canadian animation studio. Before joining Bardel in 2017 as Controller, he held several senior level accounting and finance positions, most recently with WildBrain (TSX: WILD), a publicly traded family entertainment company where he oversaw financial and disclosure reporting throughout the Company s merger integration of Nerd Corps Entertainment and Studio B. As a result of the above, the Company s senior management team now consists of Parimal Rana, Chief Executive Officer, Pratik Patel, Chief Financial Officer and Jordan Rogers, Chief Commercial Officer, Going Concern and History of Net Losses The Company s audited annual consolidated financial statements for the years ended December 31, 2021 (the 2022 Financial Statements ), including the report of the independent registered public accounting firm with respect thereto, incorporated by reference herein by the Company s Form 20-F filed with the SEC on May 27, 2022, and amended on August 8, 2022, were prepared assuming that the Company will continue as a going concern, which assumes that the Company will be able to realize its assets and satisfy its liabilities in the normal course of business for the foreseeable future. As discussed in Note 1 to the 2022 Financial Statements, the Company has incurred losses and has negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. For the year ended December 31, 2021, the Company generated a net loss of $54,559,923 (2020 - $13,858,800) and negative cash flows from operations of $41,926,328 (2020 - $9,660,481). The Company expects to incur further losses in the development of its business and has significant capital projects planned. The continued operations of the Company are dependent on management s ability to manage costs, raise additional equity or debt, and on future profitable operations. Whether and when the Company can generate sufficient operating cash flows to pay for its expenditures and settle its obligations as they fall due is uncertain. Furthermore there can be no assurances that the Company will be able to raise funds through future debt or equity issuances. As a result of these conditions, management has concluded, in making its going concern assessment, that there are material uncertainties related to events and conditions that may cast significant doubt upon the Company s ability to continue as a going concern. These 2022 Financial Statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and statement of financial position classifications that would be necessary were the going concern assumption inappropriate. These adjustments could be material. Table of Contents Nasdaq Notification Minimum Bid Price Rule On January 11, 2022, the Company received notification (the January 2022 Notification ) from the Listing Qualifications Department of Nasdaq that, for the previous 30 consecutive business days, the bid price of the Company s Common Shares had closed below the minimum US$1.00 per share requirement for continued inclusion on the Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the Bid Price Rule ). Under Nasdaq rule 5810(c)(3)(A), the Company had until July 11, 2022 to regain compliance with the Bid Price Rule. On July 11, 2022, the Company received a notification (the July 2022 Notification ) from the Listing Qualifications Department of Nasdaq that it had granted the Company an additional 180-day period from July 11, 2022 to regain compliance with the minimum US$1 bid price requirement for continued listing on The Nasdaq Capital Market. The January 2022 Notification has no immediate effect on the listing of the Common Shares. The Company is also listed on the TSXV and the notification does not affect the Company s compliance status with such listing. In the July 2022 Notification, Nasdaq notified the Company that if compliance cannot be demonstrated by January 9, 2023, Nasdaq will provide written notification that the Company s securities will be delisted at which time, the Company may appeal Nasdaq s determination to a hearings panel (the Panel ). If the Company appeals, the Company will be asked to provide a plan to regain compliance to the Panel. Nasdaq Notification Late Form 20-F Filing On May 20, 2022, the Company received notification from Nasdaq that that since the Company had not yet filed its Annual Report on Form 20-F for the year ended December 31, 2021, it was no longer in compliance with Nasdaq Listing Rule 5250(c)(1), which requires the Company to timely file all required periodic financial reports with the SEC. The Company filed its Annual Report on Form 20-F on May 27, 2022, and as a result, the Company believes it has regained compliance with Nasdaq Listing Rule 5250(c)(1). Implications of Being an Emerging Growth Company The Company qualifies as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, the Company may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies, including: presenting only two years of audited financial statements and only two years of related Management s Discussion and Analysis of Financial Condition and Results of Operations disclosure; reduced disclosure about the Company s executive compensation arrangements; exemption from the requirements to hold non-binding advisory votes on executive compensation; extended transition periods for complying with new or revised accounting standards; exemption from the auditor attestation requirement in the assessment of our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act; and exemption from complying with any requirement that may be adopted by the Public Company Accounting Oversight Board, or the PCAOB, regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis). The Company may take advantage of these exemptions up until the last day of the fiscal year following the fifth anniversary of its initial public offering or such earlier time that the Company is no longer an emerging growth company. The Company will cease to Table of Contents be an emerging growth company if it has more than $1.07 billion in annual revenue, it has more than $700 million in market value of its stock held by non-affiliates, or it issues more than $1 billion of non-convertible debt securities over a three-year period. The Company may choose to take advantage of some, but not all, of the available exemptions. Implications of Being a Foreign Private Issuer Status The Company is a foreign private issuer under applicable U.S. federal securities laws, and is, therefore, not subject to the same requirements that are imposed upon U.S. domestic issuers by the SEC and Nasdaq. Under the Securities Exchange Act of 1934, as amended (the Exchange Act ), the Company is subject to reporting obligations that, in certain respects, are less detailed and less frequent than those of U.S. domestic reporting companies. As a result, the Company does not file the same reports that a U.S. domestic issuer would file with the SEC. In addition, the Company s officers, directors, and principal shareholders are exempt from the reporting and short-swing profit recovery provisions of Section 16 of the Exchange Act. Therefore, the Company s shareholders may not know on as timely a basis when the Company s officers, directors and principal shareholders purchase or sell Common Shares, as the reporting periods under the corresponding Canadian insider reporting requirements are longer. Moreover, as a foreign private issuer, the Company is exempt from the rules and regulations under the Exchange Act related to the furnishing and content of proxy statements for annual meetings and other events requiring the solicitation of a shareholder vote. In addition, as a foreign private issuer, the Company is permitted to follow certain Canadian corporate governance practices in lieu of those required by Nasdaq listing rules. In particular, the Company s articles provide a minimum quorum requirement of 5% which is less than the Nasdaq s minimum requirement of at least 33 1/3% of the outstanding Common Shares. The Company is also not required under applicable Canadian law or the rules of the TSX-V to have a majority independent board of directors, provided that the Company has at least two independent directors. As a foreign private issuer, the Company intends to follow Canadian corporate governance practices in lieu of the Nasdaq requirement to have a majority independent board. As a result, the Company s shareholders may not have the same protections afforded to shareholders of U.S. domestic companies that are subject to all U.S. corporate governance requirements. Also, as a foreign private issuer, the Corporation intends to follow the listing rules of the TSX-V in respect of private placements instead of the requirements of the Nasdaq to obtain shareholder approval for certain dilutive events (such as issuances that will result in a change of control, certain transactions other than a public offering involving issuances of a 20% or greater interest in the Company and certain acquisitions of the shares or assets of another company). Table of Contents
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+This summary highlights information contained in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes thereto and the information in Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Overview We Are the Trusted Authority on Sleep We question whether America got up on the wrong side of the bed or the wrong bed altogether. Health, wellness and longevity are rooted in fitness and nutrition, but all start with the right mattress. We have been helping to solve America s sleep problems for decades and have learned two fundamental truths: everyone deserves a good night s sleep, and each individual has unique sleep needs. As the trusted authority on sleep, we are committed to match each customer with the right mattress for a perfect night s sleep. We are the largest omni-channel mattress specialty retailer in the United States (based on U.S. retail mattress revenue), offering our customers an exceptional personalized experience, whether in-store or online. We meet our customers wherever they choose to interact with our expertise-led ecosystem, whether in our 2,344 conveniently-located retail stores nationwide (as of December 28, 2021) or on our digital platforms, including MattressFirm.com and Sleep.com. Our customers can experience and compare the leading mattress brands in a single place, with a comprehensive and diversified product suite across comfort, style and prices and use data and digital tools, such as MattressMatcher, our proprietary, machine-learning enabled tool that helps match customers to their perfect mattress and identify products that will help them achieve a great night s sleep. We have heard our customers demand for selection, innovation and technology and we constantly re-assess and curate our product offering accordingly. We are the number one retailer for Tempur-Pedic, Sealy, Purple, Stearns & Foster, Beautyrest and Nectar brands (based on our purchases of units from these U.S. mattress vendors in 2021). Our customer experience goes beyond our showrooms and speedy in-home delivery options, as we use our engaging digital platforms, like Sleep.com, and our digital tools, like MattressMatcher, and data-driven partnerships, like SleepScore, to educate our customers about how sleep affects one s health and how to sleep better. Our team of more than 6,500 highly-trained Sleep Experts serves our communities every day, working and learning diligently to earn America s trust as true experts in sleep. We are the clear market leader in the large and growing U.S. retail mattress and foundations industry. In 2020, we estimated, based on data from Furniture Today and International Sleep Products Association ( ISPA ) market studies, that the U.S. retail mattress and foundations industry was approximately $18 billion. We are the category-defining national mattress specialty retailer (based on U.S. retail mattress revenue) across this attractive market with, according to our estimates, an approximately 20% market share as of the end of 2020. We estimate that we are nearly twice the size of our next largest competitor (based on U.S. retail mattress sales) and eight times larger than the next largest multi-branded mattress specialty retailer in the United States (based on store count). In fiscal 2021, our net revenue was $4,392.9 million, our net loss was $165.1 million and our Adjusted EBITDA was $669.2 million. Additionally, for the thirteen weeks ended December 28, 2021, our net revenue was $1,130.5 million, our net income was $119.9 million and our Adjusted EBITDA was $180.8 million. See Summary Summary Historical Consolidated Financial and Other Data for a reconciliation of Adjusted EBITDA to net income, the most comparable GAAP measure. As a result of our national scale, our operational excellence and the value proposition to our customers, we have been able to consistently outgrow the industry. In 2020, we were able to grow our revenue by 13.1%, while the broader U.S. retail mattress and foundations industry grew by 6.9%, according to the ISPA. Our growth is driven by both a higher volume of units sold and higher average order value. For example, our comparable sales growth of 36.1% in fiscal 2021 was driven by a 21.6% TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. The selling stockholders may not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting offers to buy these securities in any state or jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED FEBRUARY 8, 2022 PRELIMINARY PROSPECTUS Shares Mattress Firm Group Inc. Common Stock This is the initial public offering of shares of common stock of Mattress Firm Group Inc. The selling stockholders are offering shares of common stock. We will not receive any proceeds from the sale of the shares being sold by the selling stockholders in this offering. Prior to this offering, there was no public market for our common stock. We anticipate the initial public offering price will be between $ and $ per share. We intend to apply to list our common stock on the New York Stock Exchange (the NYSE ), subject to notice of official issuance, under the symbol MFRM. Investing in our common stock involves risks. See Risk Factors beginning on page 21 to read about factors you should consider before buying shares of our common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per share Total Initial public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to the selling stockholders $ $ (1) We have agreed to reimburse the underwriters for certain expenses in connection with this offering. Please see the section entitled Underwriting for a description of compensation payable to the underwriters. To the extent that the underwriters sell more than shares of common stock, the underwriters have the option to purchase up to an additional shares from the selling stockholders on a pro rata basis at the initial public offering price less the underwriting discount. The underwriters expect to deliver the shares of common stock to investors on or about , 2022. Joint Book-Running Managers Goldman Sachs & Co. LLCBarclaysJefferies UBS Investment BankGuggenheim SecuritiesPiper SandlerTruist Securities Co-Managers KeyBanc Capital Markets Raymond James Wedbush Securities Telsey Advisory Group Loop Capital Markets Academy Securities Ramirez & Co., Inc. The date of this prospectus is , 2022. TABLE OF CONTENTS outside the United States are required to inform themselves about and to observe any restriction as to this offering and the distribution of this prospectus applicable to those jurisdictions. The information contained in this prospectus is accurate only as of its date, regardless of the time of delivery of this prospectus, or any free writing prospectus, as the case may be, or any shares of our common stock. Our business, results of operations, financial condition and prospects may have changed since that date. TABLE OF CONTENTS increase in the number of customer transactions and a 14.5% increase in our average order value. As of December 28, 2021, our total liabilities were $3,291.3 million and our net long-term debt was $1,197.4 million. Since the beginning of fiscal 2019, we have fundamentally transformed our business across all functions, leaving us well-positioned to capitalize on growth opportunities and capture market share. As part of this transformation, we significantly enhanced our operations and profitability through the following key actions: rationalized and optimized our store footprint to create a highly productive and profitable store base. We closed more than 980 stores and estimate that we have been able to recapture a significant share of sales from these closed stores through neighboring locations as well as online. In addition, over the past three years we negotiated favorable modifications of lease terms for a significant majority of our stores; re-designed a best-in-class product assortment, including the return of Tempur Sealy products, that is focused on highly-recognized brands across different price points and styles. We also introduced an attractive mix of national brands, national exclusive brands and private brands to our product offering; strengthened our digital capabilities and scaled our e-commerce business to create a true omni-channel experience, opening our doors to customers when, where and how they wish to shop; enhanced our customer-facing digital toolkit with MattressMatcher, Sleep.com and SleepScore, among others, to support and personalize purchase decisions and educate customers on the effects of sleep on health and how to sleep better; introduced an incentivized compensation structure and upgraded the training and development of our Sleep Experts to optimize the efficiency, education and effectiveness of our sales force; better aligned our supply chain to leverage our distribution footprint more effectively; focused our marketing spend on digital alongside a more disciplined and analytical, data-driven approach; and streamlined our cost structure to create a leaner and more efficient organization. Due to these actions, we have significantly improved our financial profile, sales productivity and other key performance metrics, as demonstrated in the comparison of fiscal 2019 to fiscal 2020 and fiscal 2020 to fiscal 2021 for the metrics set forth below: See Summary Summary Historical Consolidated Financial and Other Data for definitions of comparable sales growth, revenue per store, average order value and website visitors. TABLE OF CONTENTS TABLE OF CONTENTS NOTE REGARDING INDUSTRY AND MARKET DATA Within this prospectus, we reference information and statistics regarding the bedding industry and the mattress specialty retail industry as well as certain non-mattress retail categories. We have obtained this information and statistics from various independent third-party sources, including independent industry publications and groups, reports by market research firms and other independent sources. Some data and other information contained in this prospectus are also based on our estimates and calculations, which are derived from our review and interpretation of internal company research, surveys and independent sources. Data regarding the industry in which we compete and our market position and market share within this industry are inherently imprecise and are subject to significant business, economic and competitive uncertainties beyond our control, but we believe such data generally indicate size, position and market share within the industry in which we compete. While we believe our internal company research, surveys and estimates are reliable, such research, surveys and estimates are subject to significant uncertainties. In addition, assumptions and estimates of our and our industry s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in Risk Factors. These and other factors could cause our future performance to differ materially from our assumptions and estimates. See Cautionary Note Regarding Forward-Looking Statements. As a result, you should be aware that market, ranking and other similar industry data included in this prospectus, and estimates and beliefs based on that data, may not be reliable. Neither we, nor the selling stockholders nor the underwriters can guarantee the accuracy or completeness of any such information contained in this prospectus. NOTE REGARDING TRADEMARKS, TRADENAMES AND SERVICE MARKS We own or have rights to use the trademarks, service marks and trade names that we use in conjunction with the operation of our business. Some of the more important trademarks that we own or have rights to use that appear in this prospectus include: Mattress Firm, Sleep Experts, 120 Night Sleep Trial, Sleepy s, Tulo, MattressMatcher, Junk Sleep, Sleep.com and SleepScore. Trademarks, trade names or service marks of other companies appearing in this prospectus are, to our knowledge, the property of their respective owners. TABLE OF CONTENTS (1) Data as of the end of the period. In fiscal 2019, our net store count declined by 707 stores. Additionally, not accounting for acquired or newly opened stores, we closed 744, 128 and 100 stores in fiscal 2019, fiscal 2020 and fiscal 2021, respectively. Our superior scale, differentiated value proposition and relentless focus on service and experience have driven net revenue and Adjusted EBITDA at a CAGR of 21.8% and 108.9%, respectively, from fiscal 2019 to fiscal 2021. Our growth trajectory and financial performance prior to COVID-19 were strong and we have continued to out-perform the market during and beyond COVID-19. The onset of COVID-19 in our third quarter of fiscal 2020 caused us to pivot sharply towards digital offerings, thereby accelerating our strategic initiatives in that area. Note: See Summary Summary Historical Consolidated Financial and Other Data for a reconciliation of Adjusted EBITDA to net income, the most comparable GAAP measure. Industry Overview The Sleep Industry is Large, Growing and Resilient We operate in the large, growing and resilient U.S. sleep industry, which we define as (i) our core mattress and foundations market and (ii) adjacent sleep products, such as pillows, bed linens and bedroom furniture, among others. We estimated, based on data from Furniture Today and ISPA market studies, the U.S. retail mattress and foundations industry to be approximately $18 billion in 2020. This includes both brick and mortar and online channels, which we estimated to be approximately $12 billion and approximately $6 billion, respectively. The U.S. wholesale mattress and foundations industry is the primary driver of retail mattress sales in the United States and grew at a 5.5% CAGR between 1974 and 2020, according to data compiled by the ISPA. Additionally, according to data compiled by the ISPA, the U.S. retail mattress industry s average order value grew at a CAGR of 3.8% between 1974 and 2020, and mattress unit volume grew at a CAGR of 2.3% over the same period. Importantly, while sales have dipped during more challenging economic environments, the market has consistently recovered quickly, demonstrating the postponement, not cancelation, of purchases. The table below sets forth the U.S. mattress and foundations wholesale market revenue for the periods presented: In addition to our core focus on the retail mattress and foundations industry, we operate in select adjacencies across the broader sleep market, including pillows and bed linens. We estimate that the pillows market in North America will be approximately $14 billion in 2021 and we expect it to grow at a CAGR of approximately 6% from 2021 through 2024, according to data compiled by Technavio. We estimate that the bed linens market in North America will be approximately $12 billion in 2021 and we expect it to grow at a CAGR of approximately 6% from 2021 through 2024, according to data compiled by Infiniti. We may also selectively enhance our offering to include other sleep-related adjacencies, such as sleep products for pets, sleep technology, sleep services and bedroom furniture. TABLE OF CONTENTS BASIS OF PRESENTATION Our fiscal year consists of 52 or 53 weeks ending on the Tuesday closest to September 30th. Accordingly, references herein to fiscal 2019 relate to the 52 weeks ended October 1, 2019, references herein to fiscal 2020 relate to the 52 weeks ended September 29, 2020, references herein to fiscal 2021 relate to the 52 weeks ended September 28, 2021, references herein to fiscal 2022 relate to the 52 weeks ending September 27, 2022 and references herein to fiscal 2023 relate to the 53 weeks ending October 3, 2023. Our fiscal quarters consist of the thirteen or fourteen weeks ending on the Tuesday closest to each of December 31, March 31, June 30 and September 30. References to any given year in this prospectus will be to a calendar year, and not a fiscal year, unless otherwise noted. Subsequent to the date of the original issuance, we concluded that we were required to restate our audited consolidated financial statements as of and for the fiscal year ended September 28, 2021. The financial information in this prospectus include the effects of the restatement. Please see Note 20 Restatement of Previously Issued Consolidated Statement of Cash Flows to the consolidated financial statements. We adopted Accounting Standards ( ASU ) No. 2016-02, Leases (Topic 842), ASU No. 2018-10, Codification Improvements to Leases, Topic 842, and ASU No. 2018-11, Targeted Improvements (collectively Topic 842 ) effective as of October 2, 2019. As a result of this change in accounting standards, certain of our financial information for fiscal 2019 is not comparable to the subsequent periods, such as fiscal 2020 and fiscal 2021. Consequently, you should not put undue reliance on our relative performance in these periods. All store count data presented in this prospectus excludes franchised stores. Certain numerical figures included in this prospectus have been subject to rounding adjustments. Accordingly, numerical figures shown as totals in various tables or charts may not be arithmetic aggregations of the figures that precede them, and figures expressed as percentages in the text may not total 100% or, as applicable, when aggregated may not be the arithmetic aggregation of the percentages that precede them. NON-GAAP FINANCIAL MEASURES This prospectus contains non-GAAP financial measures, which are financial measures that either exclude or include amounts that are not excluded or included in the most directly comparable measures calculated and presented in accordance with accounting principles generally accepted in the United States ( GAAP ). These non-GAAP measures include Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income (Loss) and Adjusted Free Cash Flow. For definitions of these terms, see Summary Summary Historical Consolidated Financial and Other Data. These non-GAAP financial measures should be considered along with, but not as alternatives to, the financial performance measures as calculated in accordance with GAAP. Usefulness While these non-GAAP financial measures are not in accordance with, or preferable to, GAAP financial data, our management, our board of directors and our major stakeholders, as well as securities analysts and ratings agencies, use various non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDA Margin, along with the corresponding GAAP financial measures: to assist in monitoring our ongoing financial performance, including underlying results and trends, particularly in comparison with prior periods on a consistent basis, by excluding items not considered representative of our ongoing operating performance; to supplement GAAP measures of performance in evaluating the effectiveness of our business strategies and budgeting and capital allocation and investment decisions; to remove items that can vary substantially from period to period, depending on accounting and tax treatments, the book value of assets and the method by which assets were acquired; to support internal planning and forecasting and establish operational goals; and to assist with executive performance evaluations and compensation. TABLE OF CONTENTS Market Growth is Supported by Favorable Economic Fundamentals and Attractive Consumer Trends Strong macroeconomic backdrop. Historically, mattress sales growth has closely followed U.S. gross domestic product ( GDP ) growth. According to The International Monetary Fund, U.S. GDP is estimated to have grown 5.6% in 2021, the fastest rate since 1984, and is expected to continue to grow at an attractive rate of 4% in 2022. Additionally, the U.S. retail mattress and foundations industry is expected to further benefit from near-term inflation, which is estimated to have grown 5.3% in 2021 and is expected to grow 2.6% in 2022, according to The Federal Reserve. Robust housing market. The housing market is a strong indicator of mattress sales in the United States. According to statistics jointly issued by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, housing starts increased by 6.9% in 2020 and increased by 15.6% in 2021. Additionally, further tailwinds include increasing turnover of the existing housing stock, which has been powered by the new construction market and a favorable interest rate environment. According to National Association of Realtors, it is estimated that there is a shortage of 5.5 million houses for sale in the United States based on current demand dynamics, which we expect to further increase demand for our products in the coming years. Home ownership by younger generations. According to the U.S. Census Bureau, the home ownership rate in the United States is currently 65.4%; however, the homeownership rate of adults under 35 years old is only 38.5%. The Millennial generation is currently the largest U.S. generation and, as the U.S. population continues to age, is expected to make up a larger portion of the population. As the younger population groups age, they are expected to form new households, including purchasing new homes. We believe this is a strong tailwind to our industry. Consumers Increasingly Recognize Quality Sleep as a Key Component of a Healthy Lifestyle The sleep industry benefits from important macroeconomic trends underlying an increasing focus on health and wellness. Consumers increasingly recognize that high-quality sleep is critical to health and wellness, as more high-profile individuals, such as business leaders, celebrities and medical professionals, increasingly speak about the importance of a good night s sleep. According to a 2021 report by the Better Sleep Council, consumers rate sleep as the single most important factor for their health and wellbeing, ahead of diet, exercise and mental health. Additionally, according to a 2021 report by the Better Sleep Council, two in every five Americans are dissatisfied with their quality of sleep. Furthermore, we believe as consumers become more educated about the potentially negative health consequences of poor-quality sleep, they are likely to spend more on sleep products. A 2016 study from the Better Sleep Council found that the price that consumers expect to pay for a quality mattress had increased by 19% from 2007 to 2016. In addition, the consistent replacement cycle of sleep products helps create a stable, resilient market. The same 2016 study found that the mattress replacement cycle in the United States accelerated by 14% from 2007 to 2016. Our goal is to help Americans sleep better to live better and we have launched a website, Sleep.com, to help consumers explore the health benefits of quality sleep. Our Sleep.com platform is differentiated by providing education through credible sources like sleep doctors, scientists and neurologists, inspiration through design resources and technology ideas, and wellness guidance through custom in-house and influencer-created content. Our approach is focused on continuing to build sleep expertise credibility and cultural relevance for our brand. Since inception in August 2020 through December 28, 2021, over 3.1 million visitors have visited Sleep.com. By providing helpful, interesting educational content, this platform allows us to maintain meaningful contact with consumers in the time span between one mattress product need and another, reinforcing our belief that we are the place to visit when it comes to sleep. Competitive Landscape is Favorable for Omni-Channel Retailers with National Scale and a Physical Presence The mattress and foundations industry is fragmented and comprised of mattress specialty retailers, furniture and department stores, club stores and DTC brands. Many of these market participants are TABLE OF CONTENTS Our management, our board of directors and our major stakeholders, as well as securities analysts and ratings agencies, also use Adjusted Net Income (Loss), along with the corresponding GAAP financial measures: to assist in monitoring our ongoing financial performance, including underlying results and trends, particularly in comparison with prior periods on a consistent basis, by excluding items not considered representative of our ongoing operating performance; to supplement GAAP measures of performance in evaluating the effectiveness of our business strategies and budgeting and capital allocation and investment decisions; to remove items that can vary substantially from period to period, depending on accounting and tax treatments, the book value of assets and the method by which assets were acquired; to support internal planning and forecasting and establish operational goals; and to understand the after tax impact of non-recurring adjustments. Adjusted Free Cash Flow is a useful measure of liquidity and our ability to service our obligations and an additional basis for assessing our ability to convert net revenue into available cash, providing information to management, analysts and investors about the amount of cash flows from operating activities that, after capital expenditure plus cash payment of deferred paid-in-kind interest, can be used for strategic initiatives, including investing in our business, and strengthening our financial position. Limitations Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income (Loss) and Adjusted Free Cash Flow have their limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results of operations as reported under GAAP. For example, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Income (Loss): do not reflect period over period changes in taxes, income tax expense or the cash necessary to pay income taxes; do not reflect the interest expense and the cash requirements necessary to service interest or principal payments on our debt; do not reflect cash requirements for replacement of assets that are being depreciated and amortized; do not reflect our cash requirements for capital expenditures; do not reflect changes in our cash requirements for our working capital needs; do not reflect stock and other non-cash compensation, which is a key element of our overall long-term compensation; and do not reflect the impact of certain cash charges or cash receipts resulting from matters we do not find indicative of our ongoing operations. Adjusted Free Cash Flow is not intended to be a measure of free cash flow available for management s discretionary use, as we do not consider certain cash requirements, such as interest payments or payments of deferred paid-in-kind interest, tax payments and debt service requirements. It also does not reflect changes in, or cash requirements for, working capital needs. Non-Comparability The non-GAAP financial measures that we use have no standardized meaning as prescribed by GAAP or otherwise and may be interpreted and calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies, including companies in our industry. Because not all companies use identical calculations or methods of adjustment, the presentations of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company. In addition, other companies may use different measures to evaluate their performance, which also could reduce the usefulness of our non-GAAP financial measures for comparison. TABLE OF CONTENTS not able to offer category expertise, a broad product offering or an omni-channel experience. For these reasons, customers have gravitated toward mattress specialty retailers, like us. As consumer purchasing preferences continue to shift, we believe that mattress specialty retailers with category expertise and knowledge and an omni-channel model will succeed by allowing the customer to seamlessly transition between online and offline shopping and to personalize their purchasing experience. Therefore, the importance of a nationwide store footprint that can service the vast majority of the U.S. population, coupled with a best-in-class distribution, a leading digital platform and delivery network becomes critically important given the increased focus on convenience. According to research from the Better Sleep Council conducted in 2017, 92% of consumers say it is important to try out a mattress before making a purchase. Our differentiated suite of omni-channel capabilities positions us well to continue to gain share in a growing and fragmented market. Our Strengths We believe there are several key attributes that define and differentiate us and position us to continue to win in the attractive markets in which we operate. Mattress Market Leader in the United States We are the market leader in the U.S. retail mattress and foundations industry with, based on our analysis of data provided by industry sources, a market share of approximately 20% at the end of 2020. As the largest mattress specialty retailer by sales, market share and store count, we are a leading sleep retail brand in the United States. We are known for our comprehensive and diversified product assortment, exceptional customer service and compelling value proposition. Our market-leading position is further supported by industry-leading reach, based on our analysis of data provided by industry sources and the largest marketing spend in the mattress retail industry, which provides us with approximately 30% share of voice, according to our estimates. Mattress Firm is a household name with approximately 140 million consumer touchpoints annually, across in-store, online and event sponsorships. We believe this exposure positions us to be top-of-mind for consumers when they begin their mattress purchase journey. To bolster our brand awareness, we launched our Junk Sleep campaign in July 2021, which has resulted in over 125 earned media placements and more than 3.2 billion potential impressions across earned, traditional, digital and social media from the launch date of the campaign in July 2021 through the end of December 2021. (1) Includes net revenue from our B&M and Other Business operating segments, excluding financing fees. (2) Includes net revenue from our Digital operating segment, excluding financing fees. Proven Omni-Channel Strategy We drive our sales by creating an omni-channel customer experience through our integrated platform that allows customers to transition across channels seamlessly and personalize their experience. A national, coast-to-coast physical network of 2,344 stores as of December 28, 2021 provides exceptional in-store customer service, which we enhance by leveraging our sleep expertise through our digital toolkit. In fiscal 2021, we had over 62 million website visitors to MattressFirm.com. In-store and online, customers can use our MattressMatcher digital tool to get real-time and personalized TABLE OF CONTENTS CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements. Statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, including, among others, statements regarding the offering, expected growth, future capital expenditures and debt service obligations, are forward-looking statements. In many cases, forward-looking statements can be identified by terminology such as may, would, should, expect, plan, anticipate, believe, estimate, predict, intend, potential or continue or the negative of these terms or other comparable terminology. These forward-looking statements are made based on management s expectations and beliefs concerning future events affecting us and are subject to uncertainties and factors relating to operations and the business environment, all of which are difficult to predict and many of which are beyond our control. These uncertainties and other factors could cause the actual results to differ materially from those matters expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, there is no guarantee of future results, levels of activity, performance or achievements. Statements that we believe and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this prospectus, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. All forward-looking statements contained herein are based on information available on the date of this prospectus. There is no obligation to publicly update or revise any of the forward-looking statements, whether as a result of new information, future events or otherwise. Some of the important factors that could cause actual results, performance or financial condition to differ materially from expectations are: conditions of the U.S. economy and reduction in discretionary spending by consumers; risks inherent in outbreaks of pandemics or contagious disease, including COVID-19; a deterioration in our relationships with our primary suppliers; a failure by any of our limited number of primary suppliers to supply us with products; product safety and quality control; competition within our industry; challenges posed by our planned growth or unexpected difficulties during our omni-focused growth; geographic concentration of stores within the United States; ability to establish and maintain a favorable brand presence with consumers; the ability to provide timely delivery to our customers; the ability to anticipate consumer trends; the effectiveness and efficiency of advertising expenditures; inability to renew existing leases or enter into new leases for additional stores on favorable terms; the success of our strategy to expand our e-commerce business and to drive customer traffic with our complementary website; the possible impairment of goodwill or other acquired intangible assets; losses associated with store closings and impairment of store assets; fluctuations in comparable sales; TABLE OF CONTENTS mattress recommendations. Customers can then test the bed at our conveniently located stores to assess comfort level before making a purchase. We combine this in-store option with an engaging digital experience, where they can learn about sleep, such as at Sleep.com, chat with Sleep Experts, browse mattresses and other sleep-related products and interact with digital tools, such as MattressMatcher. We believe that the combination of our best-in-class in-store and online experience allows our customers to transact irrespective of how, where and when they want to shop, so there is no reason for them to go outside of our expertise-led ecosystem. Unparalleled Physical Infrastructure We have the largest national, coast-to-coast retail footprint of any mattress specialty retailer in the United States with 2,344 stores as of December 28, 2021, with an estimated 82% of the U.S. population living within 10 miles of one of our stores (excluding areas without enough of a concentrated population to profitably support a store, thereby excluding approximately 28 million people in fiscal 2021, which determination we make based on a complex algorithm driven by a significant number of objective criteria, including, among others, market rents, population, population density, average household income and other demographics). We estimate that we are nearly twice the size of our next largest competitor (based on U.S. retail mattress sales) and eight times larger than the next largest multi-branded mattress specialty retailer in the United States (based on store count). Our national scale enables us to provide convenience to customers that we believe our competitors cannot match. Our industry-leading fulfillment capabilities are supported by 70 distribution centers and an extensive network of over 30 third-party delivery providers. This national footprint allows us to more efficiently manage our inventory and working capital. We are actively testing the option for same day delivery on all sales in six markets and in many markets we can already meet certain same day delivery requests from customers. Additionally, we offer a full range of white-glove delivery services, including in-home set-up and removal of old mattresses. TABLE OF CONTENTS inability to balance national brands, national exclusive brands and private brands merchandise; quarterly and seasonal fluctuations in our operating results; availability of adequate capital to finance our growth; the success in keeping warranty claims and comfort exchange return rates within acceptable levels; customers ability to obtain third-party financing; our status as a holding company; risks related to acquiring complementary businesses, including franchisees; risks related to our indebtedness; risks related to regulation and legal proceedings; risks related to human capital; risks related to information technology and intellectual property; risks related to our franchisees and licensees; risks related to this offering and our stock; and other factors discussed under Risk Factors and elsewhere in this prospectus. TABLE OF CONTENTS Exceptional Customer Service and Personalized Experience Driven by Highly-Trained and Incentivized Team of Sleep Experts We enhance our customers shopping experience with a superior level of service and personalized experience. As customers increasingly seek advice on sleep products, we have made meaningful investments to develop expertise across our team of Sleep Experts. Large and Highly Trained Salesforce. We employ more than 6,500 highly-trained Sleep Experts, who each receive approximately 240 hours of training in a six- to eight-week new hire education program. Our Sleep Experts also complete approximately 200 hours of ongoing annual training thereafter, compared to the approximately 35-hour retail average in 2019, based on the Association for Talent Development s 2020 State of the Industry Report. They leverage our customer-centric digital toolkit, such as MattressMatcher, that can be used online and in-store to personalize the mattress selection process. They also educate customers about our comfort, satisfaction and price guarantees, third-party financing programs, product warranties and the other aspects of our exceptional customer experience; Effective Incentive-based Compensation Structure. In early 2020, we optimized the compensation structure for our Sleep Experts, shifting towards more commission-based compensation to better align with performance and profitability on an omni-channel basis. Sales per employee increased in the subsequent six months; Sleep Experts Support and Advocate for Our Omni-Channel Offering. Our team developed and continues to improve tools that remove friction from our sales process by allowing our store managers to receive commission for any customers that visit a store but ultimately transact online and vice versa. From fiscal 2019 to fiscal 2020, the number of Sleep Experts who generated annual revenue above $1 million increased by over 150%, and, from fiscal 2020 to fiscal 2021, that number increased by over 120%. Moving forward, we will continue to invest in education and new tools for our Sleep Experts, so we can maintain our reputation as an expertise-focused platform with the most knowledgeable and engaged sales force. Comprehensive and Diversified Product Offering Driving Unique Value Proposition We provide an expansive selection of brands and high-quality products across a wide range of technologies, styles and price points. Our differentiated value proposition allows us to meet our customers needs across an evolving lifecycle of consumer preferences and demographics. Our broad mattress assortment is driven by a mix of national brands, national exclusive brands and private brands, each catering to different customer preferences. We are the only mattress specialty retailer in the industry with all major national brands on omni-channel platforms, providing our customers with a best-in-class shopping experience. We stand behind the products we sell with our 120 Night Sleep Trial. If a mattress is not the perfect fit, we will happily pick it up and pair the customer with a new one, allowing an initially dissatisfied customer to switch to alternative brands, styles or technologies within the first 120 days of his or her original purchase. Because of our strong relationship with key suppliers, we are also able to offer customers many exclusive branded products and competitive prices, which adds to our differentiation. We also have a strong market position across all demographics, including the younger population. We believe we are well-positioned to acquire customers at a younger age and for life, with 33% of our customers transacting in the first seven months of 2021 categorized as under 35 years old. We believe that our national scale, share of voice and omni-channel presence make us the retail partner of choice for major mattress brands. We are the number one retailer for Tempur-Pedic, Sealy, Purple, Stearns & Foster, Beautyrest and Nectar brands (based on our purchases of units from these U.S. mattress vendors in 2021). Our approach centers around what we believe resonates with our customers, and we are nimble in adapting and changing our in-store, as well as online, offering based on innovation, technologies and customer demand. TABLE OF CONTENTS CERTAIN DEFINITIONS Unless the context otherwise requires, the terms our company, we, us and our refer to Mattress Firm Group Inc. and its consolidated subsidiaries. The following terms are used in this prospectus unless otherwise noted or indicated by the context: 2021 ABL Facility means our senior secured asset-based revolving credit facility entered into on September 24, 2021, among Mattress Firm, Inc., as Borrower, the guarantors party thereto and Barclays Bank PLC, as administrative agent, as described under Description of Certain Indebtedness; 2021 Term Loan means our senior secured term loan entered into on September 24, 2021, among Mattress Firm, Inc., as Borrower, the guarantors party thereto and Barclays Bank PLC, as administrative agent, as described under Description of Certain Indebtedness; associate and associates, when used in relation to our company, means our employees; B&M means our brick and mortar operating segment; CAGR means compound annual growth rate; COVID-19 means the novel coronavirus disease and related global pandemic that started in 2019; Digital means our digital operating segment; DTC means Direct-to-Consumer; impression means the rendering of an advertisement or digital media on a user s screen; market and markets, when used in relation to us, means the metropolitan statistical area or an aggregation of the metropolitan statistical areas in which we or our franchisees operate; Other Business means our other operating segment, which primarily includes events and expositions, commercial sales and custom fundraising solutions. our stores or stores means our company-operated stores and excludes our franchised stores; payback means the period required for a given store to generate enough direct cash flow to equal or exceed the direct costs of opening such store; Senior Credit Facilities means, collectively, the 2021 ABL Facility and 2021 Term Loan; session means one or more interactions with a given website by a user, with or without a transaction, within approximately 30 minutes; share of voice means the proportion of advertising spend of one retailer relative to that of the entire relevant industry; and Sleep Experts means our extensively trained, commissioned sales associates. TABLE OF CONTENTS The following chart indicates revenue by brand type for fiscal 2021: Attractive Financial Profile with Consistent Growth We have consistently increased sales productivity and increasingly generated meaningful positive cash flow. We have also rationalized and optimized our store footprint over the last five years. From fiscal 2019 to fiscal 2020, we reduced our store count by 115 stores, or 4.5%, and from fiscal 2020 to fiscal 2021, we reduced our store count by 66 stores, or 2.7%, and believe we recaptured a significant share of sales from the closed stores. In addition, we streamlined our workforce and retained top-performing Sleep Experts. As a result, from fiscal 2019 to fiscal 2020, our net revenue increased by $294.3 million, our net loss decreased by $1,091.4 million, resulting in net income of $125.6 million, and Adjusted EBITDA increased by $102.9 million. From fiscal 2020 to fiscal 2021, our net revenue increased by $1,136.3 million, net income decreased by $290.7 million, resulting in a net loss of $165.1 million, and Adjusted EBITDA increased by $412.9 million. Moreover, comparing the thirteen weeks ended December 29, 2020 to the thirteen weeks ended December 28, 2021, our net revenue increased by $201.4 million, our net loss decreased by $496.8 million, resulting in net income of $119.9 million, and Adjusted EBITDA increased by $45.4 million to $180.8 million. In 2020, COVID-19 accelerated several already growing channel trends and industry tailwinds that we believe are secular and likely to continue. In the United States there was growth in housing starts and housing turnover, which resulted in consumers investing more in their homes, particularly through purchases made while shopping online. As consumers preferences shifted towards online shopping, we ramped up our digital marketing efforts and omni-channel presence and believe we benefitted from such efforts, as evidenced by our 13.0% comparable sales growth in fiscal 2020. More specifically, we believe that by leveraging our digital platform, we have captured market share from online competitors, large and small furniture stores, mattress specialty retailers and department stores. Importantly, we do not believe that consumer demand for mattresses purchased by our customers was unusually high in 2020. Domestic mattress unit sales (which are meaningfully more expensive than imported mattresses) grew only 2.6% in 2020, based on data from the ISPA. Based on this and other factors, we believe that our growth in 2020 was primarily derived from market share gains, and that there is minimal evidence that our sales were pulled forward from future periods and disproportionately captured in 2020 as a result of COVID-19. We believe that we will continue to win market share and grow at above-market rates as consumers continue to seek a true omni-channel experience. Our highly variable cost structure, working capital management policy and increasingly robust Adjusted Free Cash Flow generation are all part of our improved financial profile. Our business model TABLE OF CONTENTS is based on an approximately 60% variable cost structure, given marketing spend and commission-based compensation structure, which allows us to quickly and effectively adapt to changing economic conditions or industry dynamics. Our working capital management policy, given inventory-light stores that primarily serve as showrooms, leverages our balance sheet to fuel growth and provides us with operating leverage. Since fiscal 2019, we have improved our annual cash flow from operating activities and Adjusted Free Cash Flow. In fiscal 2021, we generated $452.6 million in cash flow from operating activities and $445.9 million in Adjusted Free Cash Flow, respectively. However, we used $8.2 million of cash in our operating activities and had negative $36.2 million Adjusted Free Cash Flow for the thirteen weeks ended December 28, 2021 primarily as a result of using cash to pay-down various liabilities that were accrued at prior year-end, such as certain advertising and bonus expenses. See Summary Summary Historical Consolidated Financial and Other Data for a reconciliation of Adjusted Free Cash Flow to cash flow from operating activities, the most comparable GAAP measure. Best-in-Class Organization and Culture to Support Growth Our entire organization shares a common goal: a relentless focus on being recognized as the trusted authority on sleep in the United States. We believe our data-driven accountability and performance culture continues to deliver outstanding results and supports such goals. We are currently led by a team of experienced executives with diverse backgrounds in the consumer and retail industry. Our management team has a proven track-record of delivering results through a focus on operational excellence, training and development and data-driven decision-making. Our leadership team is supported by an experienced board of directors and more than 8,900 employees across the United States, including more than 6,500 highly-trained and incentivized Sleep Experts in our retail stores. Our Growth Strategy According to our estimates, approximately 70% of all mattress buyers use online tools at some point during their customer journey, either starting with an online search, continuing online after an initial store visit or completing a transaction digitally. We therefore believe that companies that are able to offer a truly seamless omni-channel experience to their customers will win in the long-term. We have defined and formulated our growth strategy with this overarching concept in mind, and we believe that our multi-pillar growth strategy and omni-channel capabilities, along with our superior scale, position us to drive above-market growth and profitability in the markets we serve. Build and Leverage our Brand and Expertise to Maintain our Leadership Position We will continue to position Mattress Firm as the go-to sleep brand for customers and the trusted authority on sleep. Whether in-store, by talking with one of our more than 6,500 highly-trained and incentivized Sleep Experts, or online, by using our MattressMatcher tool or engaging with one of our digital platforms such as Sleep.com, we will leverage our powerful, expertise-led ecosystem to allow our customers to learn about sleep, receive advice and ultimately transact with us to purchase the optimal mattress for themselves. We will continue to invest behind our brand and customer awareness, to further diversify and expand our product offering to support our reputation. Elevate Customer Experience across All Channels We believe that we are well-positioned to continue to drive traffic, increase customer conversion and average order value by leveraging our omni-channel capabilities and better serving existing and new customers across all channels. We plan to grow by: Focusing on Customer Service and Personalized Experience. We continue to evolve and optimize our service model to drive best-in-class customer experience. Our integrated omni-channel platform allows customers to transition seamlessly across channels and customize their journey. While customers start by browsing online or in-store, our team of highly-trained Sleep Experts provide high-touch personalized service and advice to help customers choose their best mattress or bedding product across all our physical locations and online. Our aspiration is to create a stress-free environment for customers to choose their sleep products, and we TABLE OF CONTENTS are launching our Store of the Future concept to create such experience and further engage our customers using our omni-channel capabilities; and Enhancing our Customer-Focused Digital Toolkit. We will continue to invest in providing a personalized user experience when our customers start or continue their journey online. We will do so by harmonizing our digital marketing approach, offering an extended product aisle online and using data and analytics tools and capabilities, to create a seamless omni-channel experience. Leverage Data and Personalized Experience to Create Customers for Life As a leading mattress retailer, we aim to develop customers for life. We believe that there are a meaningful number of mattress purchase opportunities over a customer s lifetime, including college graduation, first apartment, first family home and retirement, among others, and we are therefore focused on the lifetime value of attracting new and retaining our existing customers. To accomplish this goal, we will continue to refine our customer engagement model to align with each customer s preferences, purchasing process and lifecycle, including through the following efforts: Build Awareness. Continue to focus on upper-funnel marketing campaigns to allocate advertising dollars efficiently, identify potential customers and convince them that we are their sleep products retailer of choice; Facilitate Active Research. Refine and upgrade our omni-channel capabilities to encourage customers to use our in-store and digital toolkits to conduct mattress and sleep-related research; Offer a Seamless, Personalized Purchase Experience. Offer an engaging, personalized omni-channel experience and a market-leading value proposition; Engage with Customers Post-purchase. Enhance ongoing customer engagement by leveraging our digital toolkit, such as Sleep.com, so customers have access to a virtual Sleep Expert and interactive, educational resources when not in-store; and Increase Customer Loyalty. Focus on improving customer engagement and increase customer loyalty. Accelerate Marketing Outcomes and Build Brand Recognition We will continue to leverage our data-driven marketing capabilities across multiple channels to drive traffic to our stores and digital platform in a cost-effective way. We believe our ability to target and personalize our marketing will drive consumers to shop with us, increase conversion rates and increase average order value. We have increased and optimized our marketing spend and aligned it with customer demand. In fiscal 2021 and the thirteen weeks ended December 28, 2021, 58% and 68%, respectively, of our marketing spend was digital. We plan to continue to utilize data and analytics capabilities to refine targets, track performance and accelerate our results. We will also be selectively investing in highly efficient upper-funnel marketing campaigns to further increase our brand recognition, strength and awareness, such as our Junk Sleep campaign. We are able to leverage our national scale and national presence to create efficiencies by running broad campaigns focused on building our brand that reach a wide audience across the United States. As a result, returns on our marketing investment have been increasing since 2019. Moving forward, focusing on our customer for life strategy will allow us to increase repeat customer purchases and shorten replacement cycles. We believe that we will be able to continue to drive new and repeat customer growth with our targeted, locally-led and nationally supported marketing strategy. Disciplined Footprint Expansion We plan to reinforce our leadership in existing markets and restart our footprint expansion in some select underpenetrated markets. We have identified key markets, such as Los Angeles, CA and Buffalo/ TABLE OF CONTENTS upstate NY, where we do not have a major presence and we believe we can successfully expand with attractive economics as well as filling out the remaining expansion opportunities in the Detroit, MI market. We have developed a proven data-driven process for opening new locations, from site selection to post-opening local marketing initiatives, including tailoring floor offerings to local demand characteristics. We estimate potential for the key underpenetrated markets to be approximately 300 new stores over the next three years (without accounting for store closures). Newly opened stores, on average, have a payback period of approximately one year. As part of our normal course operations, we plan to continue to monitor and, as necessary, close underperforming stores that no longer meet our operating and performance targets. The exit costs associated with such store closures typically are minimal and consist of unamortized leasehold improvements. Based upon our historical experience, we believe we will continue to achieve significant recapture rates from such closed stores with our nearby stores and digital platform. Drive Operational Excellence to Fund Growth and Maximize Stockholder Value We will continue to leverage our superior scale to fuel topline growth, enhance margins and drive operating leverage across our business. As we continue to serve more customers and operate our business using data-driven analytics, we will be able to analyze how our Sleep Experts perform and how our customers shop, both in-store and online. Our national scale and data-driven approach will allow us to learn from our day-to-day interactions, adapt our marketing efforts in real-time and continue to train our Sleep Experts on sleep and related best practices. We believe this will allow us to drive profitable revenue growth, including by maximizing attachment rates of auxiliary products, such as accessories and delivery, by minimizing discounted sales and by utilizing other opportunities to further drive topline efficiencies. We expect to generate meaningfully increased efficiencies, leveraging our national scale and optimized retail footprint and digital operations, our distribution and delivery network, our corporate support functions, our national marketing reach, our training and development programs and our data and analytics capabilities, each over a growing revenue base. We also have an opportunity to expand gross margin by increasing share of our own private brands, including Sleepy s and Tulo. As a result of these growth strategies and our relatively low capital expenditures requirements, we expect to generate attractive growth, profitability and robust Adjusted Free Cash Flow to maximize value for our stockholders. Corporate Information We are a Delaware corporation formed on August 3, 2016 to facilitate the acquisition of Mattress Firm Holding Corp. and its mattress specialty retail business by Steinhoff International Holdings, N.V. ( Steinhoff International and, together with its subsidiaries the Steinhoff Group ). On September 7, 2021, we changed our name from Stripes US Holding, Inc. to Mattress Firm Group Inc. In October 2018, Mattress Firm, Inc., its subsidiaries and certain of its affiliates filed voluntary petitions for relief under Title 11 of the U.S. Code in the U.S. Bankruptcy Court for the District of Delaware. Following our emergence from bankruptcy in November 2018, the Steinhoff Group owned 50.1% of our common stock and a group of creditors that provided exit financing (the Creditor Stockholders ) owned the remaining 49.9%, in each case prior to dilution from equity awards granted to certain of our officers and non-employee directors. The following chart presents an overview of our ownership and organizational structure, after giving effect to this offering, assuming the underwriters do not exercise their option to purchase additional shares. The percentages of ownership of our shares of common stock after the offering set TABLE OF CONTENTS forth below are based on shares of our common stock to be issued and outstanding immediately after this offering, in all cases, assuming no net share settlement. Our principal executive offices are located at 10201 S. Main Street, Houston, Texas 77025 and our telephone number at that address is (713) 923-1090. Our internet address is www.mattressfirm.com. We also operate an internet site at . Please note that any references to www.mattressfirm.com and www.sleep.com in this prospectus are inactive references only and that our websites, and the information contained on, or accessible through, our websites is not part of nor incorporated into this prospectus.
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: common stock are to our Class A common stock and our Class B common stock, collectively; equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for shares of Class A common stock issued in connection with our initial business combination including but not limited to a private placement of equity or debt; founders are to Daniel Ibri, Nemer Rahal and Camila Potenza. founder shares are to shares of our Class B common stock initially purchased by our sponsor prior to this offering, and the shares of our Class A common stock issued upon the conversion thereof as provided herein (for the avoidance of doubt, such shares of Class A common stock will not be public shares ); initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers and directors; Citigroup are to Citigroup Global Markets Inc., an underwriter of this offering; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and members of our management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market), to the private placement warrants or private placement warrants issued upon conversion of working capital loans if held by third parties other than our sponsor, directors, officers or the underwriters (or their permitted transferees); sponsor are to Mindset Growth Sponsor I LLC, a Delaware limited liability company. warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants to the extent they are no longer held by the initial purchasers thereof or their permitted transferees; and we, us, company or our company are to Mindset Growth Opportunities I Corp. Each unit consists of one share of Class A common stock and one-half of one redeemable warrant for each unit purchased. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase 1 Table of Contents an even number of units, the number of warrants issuable to you upon separation of the units will be rounded down to the nearest whole number of warrants. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General Overview We are a newly incorporated blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar transaction with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not identified any business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. We believe that the extensive operational, financial, M&A and capital markets experience of our management team led by Daniel Ibri, Nemer Rahal and Camila Potenza coupled with a collective global network to source deals, positions us extremely well to identify attractive business combination opportunities and to bring value to the business post-combination. Our Mission Our mission is to identify, invest in, and maximize the value of companies that focus on disruptive agriculture and food technologies ( AgriFoodTech ), including corporate spinouts, closely held companies, and institutionally backed businesses. Given our strong track record in multiple transactions in different geographies, and backed by our solid expert network, we are looking for opportunities in the United States, Israel and Brazil. Our focus on AgriFoodTech is based on our expertise and successful track record in the segment, and on our perception of the enormous impact that such business has on the overall agribusiness market and population welfare. We firmly believe that the new and potentially disruptive technologies need to be applied to farming and food production to increase productivity to successfully address food scarcity as it worsens through population growth. We believe that the AgriFoodTech space is one of the few segments in which companies thrive economically while positively contributing to society delivering strong results and complying with ESG best-practices. It is in the DNA of our parent company Mindset Ventures Holdings Ltd. ( Mindset Ventures ) to foster the growth of disruptive technologies while positively impacting the society on a global scale. Mindset Ventures has successfully invested in more than 50 companies over the last five years in the United States and Israel, including two unicorns, and six successful exits. Thanks to Mindset Ventures strategic and financial contributions, during this period it has helped companies thrive in scaling their businesses. Mindset Ventures is sponsoring the company as a way to further leverage on its organizational expertise and solidify its AgriFoodTech ecosystem. We will look for companies that (1) have developed disruptive technologies, (2) focus on large addressable markets, (3) possess solid operations and (4) are run by experienced management teams, which we believe have the potential to grow even faster by leveraging our expertise and our strategic worldwide industry connections. Our Parent and Sponsor Created in 2016, Mindset Ventures is an international venture capital fund managed by seasoned executives with decades of experience in the venture capital and private equity markets. The Mindset Ventures management team has over 45 years of combined expertise in the field. Mindset Ventures is further supported by top-notch advisors with decades of experience in the venture capital world in a multitude of industries, ranging from corporate governance to legal aspects. Mindset Ventures was created to meet a suppressed demand from investors looking for an opportunity to allocate resources in top-notch Israeli and American startups. At the same time, it helped its founders to grow and expand internationally, leveraging the success of its founders in the venture capital market. Mindset Ventures has offices in Brazil, the United States, and Israel. It provides investment capital to companies in a wide range of segments, including AgriFoodTech. Mindset Ventures has a successful track record of identifying unique investment opportunities, and supporting its portfolio companies in multiple aspects, 2 Table of Contents including defining and pursuing clear strategies and international expansion. Mindset Ventures was consecutively awarded as one of the most active venture capital funds by the Israeli Venture Capital Research Center as a result of its three oversubscribed funds. The Current Agribusiness Environment Agribusiness is a $9 trillion market that remains largely offline and unexplored. Agribusiness is plagued by several inefficiencies including waste and asymmetry of information. Surrounded by environmental and social dilemmas, although crucial for humankind, this market has embraced technology at a much slower pace than several other markets. Production capacity constraints, if not overcome, will present severe risks going forward. Throughout the past few centuries, the agribusiness market reached immense proportions given its importance to society. Approximately 50% of the world s total habitable land is currently used for agricultural purposes. Seventy-seven percent of agricultural land is used for livestock and 23% is used for crops, despite livestock constituting only 18% of the world s consumed calories and 37% of total produced protein. Moreover, 70% of the water used in the world is for agriculture, with some regions such as South Asia using more than 90% of their water for this purpose. Additionally, agribusiness is responsible for 4% of the global economy, despite employing 27% of the world s population. According to the World Resources Institute, almost one-quarter of the world s greenhouse gases emitted come from agriculture. Without action, this number could reach nearly 42% by 2050. The agribusiness segment is immense, but has evolved at a linear pace while the world population grew exponentially. Food scarcity and food inflation are a reality and pose a greater threat to humanity than ever before. According to the United Nations, by 2050 food production must increase nearly 70% (as measured by calories) as the global population is expected to reach nearly 9.6 billion people. Given that we have already reached the maximum amount of arable land for agriculture, and that available farmland has been in decline since 2001 due to soil erosion, we will be unable to achieve the 70% production growth necessary using traditional practices. Compounding these issues, according to the World Bank logistical inefficiencies cause approximately one-third of the world s agricultural production to be lost or wasted. Nearly half of food waste occurs before it reaches the market. Business and Strategy Our objective is to generate attractive returns for stockholders by identifying a high-quality target and negotiating favorable terms for a business combination. Our sourcing process will leverage our management team s broad network of relationships and unique industry knowledge as we attempt to acquire a substantial position in an AgriFoodTech business with significant growth perspectives. We would like to enable the company to go public and, using the experience of our management team, support the company in strategic decisions throughout its expansion plans, offering mentorship and relevant connections. We believe that only technology will allow the world to produce more and better food in an environment facing several limitations (i.e., environmental issues, arable land, etc.). There are a limited number of publicly listed companies working to explore the segment. We believe that opportunities in the agribusiness market are immense. This opportunity combined with our track record is expected to provide investors with a compelling opportunity to invest in one of the segments below. Innovative Food We have experienced a shift towards animal-free food products, with the proportion of vegan and vegetarians increasing yearly. With the adoption of alternative diets, the market for innovative food should grow quickly throughout the next few years. Precision Agriculture Farm monitoring has evolved significantly in recent years due to faster internet connection and processing. With large amounts of data being processed in extremely short periods of time, and drones becoming increasingly capable, digitally monitored farms became a trend. 3 Table of Contents Novel Farming Systems Several enhancements have taken place across the production process in the agribusiness environment. These enhancements allow for the optimization of resources and for increased production volumes. We believe that the need for an immediate increase in production capacity will favor innovation applied to new farming, automation, alternative protein production, and other related initiatives. Ag Fintechs Food producers still lack access to financial solutions created specifically for the segment. With digital agriculture getting more traction year after year, we believe there is a significant space for ag fintechs to be explored. Agribusiness Marketplaces The agribusiness and food segments lack marketplaces to execute trading transactions, provide online input procurement, offer equipment leasing and other solutions available in a vast marketplace. The development of the agribusiness and digital agriculture will naturally lead to the emergence of marketplaces. Farm Management Software, Sensing and IoT Software applied to agriculture is as important as the technology directly added to machinery. With processing power increasing, the usage of artificial intelligence and machine learning for several new applications became possible, opening new opportunities in the agribusiness field to optimize production and resource usage. Farm Robotics, Mechanization and Equipment In addition to innovation on the software side, the usage of drones, advanced machinery, and other technologically advanced hardware in agriculture is crucial for the scalability of production. The market for advanced agricultural equipment has already been proven, and the addition of technology is the clear trend for this segment, building future autonomous farms. Food Safety and Traceability Production optimization does not always align with quality control. Food poisoning and long-term diseases caused by poor food quality control are a major issue in the agribusiness and foods market. Increasingly strict restrictions imposed by authorities to control the quality and source of foods, new technologies aimed at facilitating and optimizing food traceability should attract significant attention in the next few years. Carbon Credit and Reduction of GHG Emissions Emission restrictions are becoming stricter, and several companies emerged to assist in reducing their environmental impact. Carbon credit is becoming a reality in some countries, as well as a starting point for startups. We expect to target a company in one of the abovementioned segments, but we may pursue a business that does not necessarily fall within these categories. Acquisition Criteria During the process of evaluating target companies, we will consider several criteria which have guided our management team s successful investment process in the last few years. Our objective is to invest in a company in the AgriFoodTech space, in which we accumulate years of experience, and have a track record of enhancing value. Our assessment will include, but is not limited to, some of the following characteristics and guidelines: Big (over a billion dollar) market, with potential for disruption and fast adoption of technology; Substantial generation of revenues without necessarily being profitable at the moment of the acquisition. Still, the achievement of profitability must be feasible and foreseen; Attractive valuation compared to its financial metrics and other public comparable companies; Solid operation, but underperforming its full potential. The company should benefit from our management team and advisors knowledge, experience and close relationships with key players in the AgriFoodTech space that could be used to scale the business; 4 Table of Contents Well-incentivized and professionally experienced founders and management team carrying solid track record with proven execution capabilities. The company s cap table should be properly balanced to incentivize managing partners; Good references not only about the team, but also about the company s solution, which must fulfill relevant client needs or market pains, and not just be complementary to other solutions or solve small/unimportant issues; Act in a considerably large overlooked but underserved sub-segment within the AgriFoodTech space, possibly with high entry barriers or enough space for multiple players to operate at full capacity; Principles, values, and interests aligned with ours, with functional corporate governance and sterling reputation; Unique solution, or technologically superior to the competition, with a defensible competitive differentiation; Scalable operation and prepared to operate as a public company; Headquartered in North America, Latin America, or Israel. These criteria should not be considered exhaustive. We are willing to accept situational complexity if we believe that the target company presents excellent potential, justifying this additional complexity, particularly if these issues can be resolved through our expertise and support. Acquisition Process When assessing a prospective company, we expect to conduct thorough diligence to determine the company s technology/product quality, the management team s experience, market potential and valuation. Our due diligence process will be based, among other things, on detailed document reviews, financial analysis, technology review, market studies, meetings with the management team, reference cross-check with customers, competitors, industry experts and other stakeholders, as well as any additional relevant information made available to us. As of the date of this prospectus, we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target concerning a business combination with us. Management Our Founders Our founders consist of the following individuals: Daniel Ibri will serve as Chief Executive Officer and as a member of the board of directors of our company. Mr. Ibri has over 10 years of experience as a venture capitalist, initial management consultant, angel investor, M&A advisor and mentor for start-ups, having closed over 60 deals in four different countries and founded three venture capital funds, including Mindset Ventures. He is a mentor and board member in several organizations, a professor of finance and entrepreneurship at INSPER in Sao Paulo, and a member of the Entrepreneurship, Innovation and Seed Capital Committee of the Brazilian Association for Private Equity and Venture Capital. Daniel holds a bachelor s degree in Business Management from FGV-EAESP, an MBA in Business Strategy and holds a specialization in Venture Capital from the Haas School of Business at University of California-Berkeley, among several other executive courses at Singularity University, Harvard University, Babson College, and others. 5 Table of Contents Nemer Rahal will serve as Chief Financial Officer and as chair of the board of directors of our company. Mr. Rahal has over 25 years of experience in the financial market. His career includes senior roles in institutions such as JP Morgan Chase and Patria Investments (a Brazilian leading alternative investments firm), where he worked as the partner responsible for Sales & Investor Relations for more than 20 years. Since 2017, Nemer Rahal has been engaged in the venture capital market acting as an angel investor and mentor for several startups. He has also been engaged in initiatives in the impact economy sector. Mr. Rahal holds a bachelor s degree in Civil Engineering, and an MBA from INSEAD, besides having attended several post-graduate courses in universities such as Stanford University and the Haas School of Business at University of California-Berkeley. Camila Potenza will serve as Chief Operating Officer of our company. With over 10 years of experience working with big corporations, financial institutions, funds and startups, Ms. Potenza started her career as a corporate lawyer, having worked for major law firms, such as Veirano Advogados and Wald Advogados in M&A, debt restructurings, judicial reorganizations and other corporate matters. She attended programs at the University of California-Berkeley, Stanford University and University of California Santa Cruz. In addition to her legal career, Ms. Potenza worked at two different startups in the Bay Area, one of which as the Head of Operations and Strategic Partnerships. Before co-founding Mindset Ventures, she also acted as Chief Legal & Compliance Officer at Acelera Partners in Brazil, a corporate venture capital fund. Ms. Potenza was recognized by LAVCA as Top Women Investing in Latin American Tech . Our Directors In addition to our founders, our board of directors will be comprised of: Vasco Luce, an independent director nominee, has more than 40 years of experience in the consumer packaged goods market. He worked for Pepsico for 33 years, being responsible for P&L, expansion, business, people development and strategy. He was also the head coordinator of the Pepsico/Ambev partnership for 27 years, and member of two global committees and of the franchise and beverages group. Mr. Luce currently invests in startups through VML Ventures, of which he is a founding partner. He participates in advisory boards of several Brazilian institutions, was Chapter President of YPO Gold S o Paulo and is a member of YPO Metro Gold NY. Mr. Luce holds a bachelor s degree in Business Management, Advertising and Marketing by PUC-RS and completed several post-graduate programs in institutions across US and Brazil. Mr. Luce will serve as our lead independent director. Rodrigo Menezes, an independent director nominee, is founding partner of Derraik & Menezes Advogados, chairman of the Entrepreneurship and Venture Capital Committee of the Brazilian Venture Capital and Private Equity Association, Board Member of the Brazilian Social Task Force and of Anjos do Brasil. As an attorney, he represents foreign and local venture capitalists, corporate ventures, startups and entrepreneurs in several venture capital and impact investment deals. He is a professor in various universities in Brazil, teaching legal aspects of venture capital and private equity investments for graduate and post-graduate programs. He is also a panelist in conferences and seminars regarding legal aspects of venture capital and private equity investments from distinct schools and associations. He is author and contributor of several articles, including the Guide VC Chapter for Brazil. Mr. Menezes holds a master s degree in law from IE Madrid and attended the VC Executive Program at the University of California-Berkeley. Mario Portela, and independent director nominee, is a partner of Circularis Partners, an investment firm focused on supporting technology-enabled companies that advance the circular economy, promote sustainability, and enhance resource efficiency. Circularis is a sub-advisor to the TPG Alternative & Renewable Technologies fund. Mr. Portela began his relationship with TPG in 2009. Mr. Portela has extensive experience investing and managing businesses globally. In recent years, he has been focused on sustainability, resource efficiency and industrial innovation. He has invested and completed M&A transactions across all stages, from venture capital and growth to large private and public deals. Mario holds a bachelor s degree in Engineering from IMPE, Lisbon, 6 Table of Contents Portugal, and has studied Finance and Marketing throughout his career at ESADE, INSEAD, IMD and the Wharton School of the University of Pennsylvania. He has lived across Europe, U.S. and South America and is fluent in five languages. Our Advisors Fabio Barbosa serves as an advisor to the company. Former president of Banco Real and of other prominent Brazilian institutions, Mr. Barbosa is a renowned Brazilian executive with solid international experience. Mr. Barbosa has been widely recognized for enhancements implemented in the companies over which he presided. He was a professor at FGV, and was named one of the 100 most influential Brazilian executives by Revista poca. Mr. Barbosa is also an expert in sustainability and ESG investments, besides being a board member at the UN Foundation. Mr. Barbosa holds a bachelor s degree in Business Administration from FGV-EAESP and an MBA from the International Institute of Management Development. Jules Miller serves as an advisor to the company. Ms. Miller is an experienced investor, entrepreneur and corporate innovation leader. Prior to joining Mindset Ventures, she co-founded IBM Blockchain Ventures, launched and ran the IBM Blockchain Accelerator, and led the IBM Blockchain Garage for North America. Before that, she was a partner at LunaCap Ventures, and Chief Operations Officer of BRAVA Investments. Ms. Miller co-founded and led two legal tech companies: Evolve Law and Hire an Esquire, as well as Carbonado Group, an environmental sustainability consulting firm. Ms. Miller earned her BA from UCLA and her MSc from The London School of Economics. She is a Kauffman Fellow (Class of 22), frequent keynote speaker, and co-author of the book The Corporate Accelerator. Boaz Albaranes serves as an advisor to the company. Mr. Albaranes has more than 10 years of experience in international relations, technology and entrepreneurship. Prior to joining Mindset Ventures, he was the Israeli Economic Consul in Brazil and headed the Israeli Trade & Investments mission in Sao Paulo. Before his role in Brazil, Boaz was a Project Lead in the Israeli Investment Promotion Center, Cadet in the Foreign Trade Administration and Project Manager at Israel Newtech. He also worked as an Algorithm Developer in an Israeli startup company and co-founded Jewgether.org. Boaz holds a bachelor s degree in Electric and Computer Engineering and an MBA, both from Technion. He was also part of a special unit of the Israeli Defense Forces (IDF). Bernhard Kiep serves as an advisor to the company. Mr. Kiep is an executive and entrepreneur with deep knowledge and execution expertise in the agribusiness market. Mr. Kiep currently works as Managing Director for BERMAD, a company that provides advanced irrigation solutions across the globe. Prior to that, he worked for other renowned agricultural companies, such as AGCO, CNH, and Valmont. Mr. Kiep is the co-founder of InLinda, an agtech company that provides a free notebook for ranchers to manage their day-to-day operations. Mr. Kiep also serves as an advisor to several other companies in the agricultural market, including Terra Magna, CBA Sementes and Irriger. He is a Member of the Board of Pessl, a leader in climate monitoring, agricultural risk, and irrigation management solutions. Mr. Kiep holds a bachelor s degree in International Business from the Hamburger Wirtschafts Akademie, and completed the Management Development Program at Harvard Business School. With respect to the foregoing experiences of our management team and special advisors, past performance is not a guarantee (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of our management s or special advisors performance as indicative of our future performance. Initial Business Combination As required by Nasdaq rules, our initial business combination will be approved by a majority of our independent directors. Nasdaq rules also require that we must complete our initial business combination with one or more businesses that together have an aggregate fair market value of at least 80% of the value of the assets 7 Table of Contents held in the trust account (excluding the deferred underwriting commissions and taxes payable) at the time of our signing a definitive agreement in connection with our initial business combination. We refer to this as the 80% fair market value test. Our board of directors will make the determination as to the fair market value of our initial business combination. The fair market value of the target or targets will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our board of directors will rely on generally accepted standards, our board of directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the board of directors in evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction will provide public stockholders with our analysis of our satisfaction of the 80% fair market value test, as well as the basis for our determinations. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, or FINRA, or another independent entity that commonly renders valuation opinions with respect to the satisfaction of the 80% fair market value test. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. We may structure our initial business combination either (i) in such a way so that the post transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% fair market value test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Other Considerations We are not prohibited from pursuing an initial business combination or subsequent transaction with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination or, subject to certain exceptions, subsequent material transactions with a company that is affiliated with our sponsor or any of our officers or directors, we, or a committee of independent directors, 8 Table of Contents will obtain an opinion from an independent investment banking firm that is a member of the FINRA or an independent accounting firm that such initial business combination or transaction is fair to our company from a financial point of view. We currently do not have any specific business combination under consideration. Our officers and directors have neither individually identified nor considered a target business nor have they had any substantive discussions regarding possible target businesses among themselves or with our underwriters or other advisors. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Corporate Information Our executive offices are located at 77 Geary St. 5th Floor, San Francisco, California 94108 and our telephone number is 415-548-6417. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the aggregate worldwide market value of our Class A common stock that is held by non-affiliates equals or exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our Class A common stock held by non-affiliates equals or exceeds $250 million as of the prior June 30th, and (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our Class A common stock held by non-affiliates equals or exceeds $700 million as of the prior June 30th. 9 Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001886015_agora_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001886015_agora_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001886015_agora_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001886268_shuaa_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001886268_shuaa_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..e99d9d2e3e62a6ce300e61022ed7abe8090ed89e
--- /dev/null
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@@ -0,0 +1 @@
+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to our amended and restated memorandum and articles of association to be in effect upon completion of this offering; Class A ordinary shares are to our Class A ordinary shares, par value $0.0001 per share; Class B ordinary shares are to our Class B ordinary shares, par value $0.0001 per share; Companies Act are to the Companies Act (As Amended) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors and our director nominees named in this prospectus; initial shareholders are to our sponsor and the other holders of our Class B ordinary shares prior to this offering (if any); letter agreement are to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our directors and officers; ordinary resolution are to a resolution adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; ordinary shares are to (i) our Class A ordinary shares and (ii) our Class B ordinary shares; private placement warrants are to the warrants issued to our sponsor and BTIG, LLC in a private placement simultaneously with the closing of this offering; public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and management team purchase public shares, provided their status as a public shareholder shall only exist with respect to such public shares; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); SHUAA Accounts are to SHUAA Capital s own accounts, accounts in which personnel of SHUAA Capital have an interest, accounts of SHUAA Capital s clients, and pooled investment vehicles that SHUAA Capital sponsors, manages or advises, including, without limitation, separately managed accounts and pooled investment vehicles such as mutual funds, collective trusts and alternative investment funds that are sponsored, managed or advised by SHUAA Capital, in each case, that may exist now or in the future; provided, however, that we are not a SHUAA Account; SHUAA Capital are to SHUAA Capital p.s.c. (DFM: SHUAA) and its affiliates, but not to us; SHUAA SPACs are to special purpose acquisition companies, blank check companies, or similar entities that SHUAA Capital may in the future invest in, but not to us; special resolution are to a resolution adopted by the affirmative vote of at least a two-thirds (2/3) majority (or such higher threshold as specified in the company s amended and restated memorandum and articles of association) of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 22, 2022 PRELIMINARY PROSPECTUS $100,000,000 SHUAA Partners Acquisition Corp I 10,000,000 Units SHUAA Partners Acquisition Corp I is a newly incorporated blank check company, incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an initial business combination target in any industry or geographic location (subject to certain limitations described in this prospectus), we intend to focus our search for a target business operating in the technology and/or tech-enabled financial services ( fintech ) sectors. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as provided herein, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable 30 days after the completion of our initial business combination and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. We have also granted the underwriters a 45-day option from the date of this prospectus to purchase up to an additional 1,500,000 units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, subject to the limitations described herein. If we do not consummate an initial business combination within 15 months from the closing of this offering, we will redeem 100% of the public shares for cash, subject to applicable law and as further described herein. However, if we anticipate that we may not be able to consummate our initial business combination within 15 months, we may, but are not obligated to, extend the period of time to consummate a business combination by an additional three months, up to two times (for a total of up to 21 months to complete a business combination), as described in detail in this prospectus. Our sponsor, SHUAA SPAC Sponsor I LLC, and BTIG, LLC, the representative of the underwriters, have committed to purchase an aggregate of 7,265,000 warrants (or 7,940,000 warrants if the underwriters over-allotment option is exercised in full) at a price of $1.00 per warrant ($7,265,000 in the aggregate or $7,940,000 in the aggregate if the underwriters over-allotment option is exercised in full) in a private placement (the private placement warrants ) that will close simultaneously with the closing of this offering. Each private placement warrant entitles the holder thereof to purchase one Class A ordinary share at $11.50 per share, subject to adjustment as provided herein. Our sponsor currently holds 2,875,000 Class B ordinary shares, up to 375,000 of which are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares concurrently with or immediately following initial business combination, on a one-for-one basis, subject to adjustment, as provided herein. Prior to our initial business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment and removal of directors and to vote on continuing the company in a jurisdiction outside the Cayman Islands. Currently, there is no public market for our units, Class A ordinary shares or warrants. We have applied to list our units on Nasdaq Global Market (the Nasdaq ) under the symbol SHUAU. We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on Nasdaq under the symbols SHUA and SHUAW, respectively, on the 52nd day following the date of this prospectus unless the representatives of the underwriters permit earlier separate trading and we have satisfied certain conditions as described herein. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. See Risk Factors beginning on page 38 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Per Unit Total Price to Public $ 10.00 $ 100,000,000 Underwriting Discounts And Commissions(1) $ 0.60 $ 6,000,000 Proceeds, Before Expenses, to Us $ 9.40 $ 94,000,000 (1) Includes $0.40 per unit, or $ 4,000,000 (or up to $4,600,000 if the underwriters over-allotment option is exercised in full) in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See also Underwriting for a description of compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $102.5 million or $117.875 million if the underwriters over-allotment option is exercised in full ($10.25 per unit), will be deposited into an interest bearing U.S.-based trust account at J.P. Morgan Chase Bank, N.A. (or at another U.S. chartered commercial bank with consolidated assets of $100 billion or more), with Continental Stock Transfer & Trust Company acting as trustee, at a brokerage institution selected by the trustee. The underwriters are offering the units for sale on a firm commitment basis. Delivery of the units will be made on or about , 2022. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No invitation, whether directly or indirectly, may be made to the public in the Cayman Islands to subscribe for our securities. Sole Book-Running Manager BTIG The date of this prospectus is , 2022. sponsor are to SHUAA SPAC Sponsor I LLC, a Cayman Islands limited liability company; warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants; and we, us, our or Company are to SHUAA Partners Acquisition Corp I, a Cayman Islands exempted company. All references in this prospectus to shares of the company being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. All references to the conversion of our Class B ordinary shares shall take effect as a redemption of such Class B ordinary shares and issuance of the corresponding Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus shall take effect as share capitalizations as a matter of Cayman Islands law. Any share capitalization described in this prospectus will take effect as an issuance of shares from share premium as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and the forfeiture by our sponsor of 375,000 Class B ordinary shares. General We are a blank check company newly incorporated as a Cayman Islands exempted company formed for the purpose of effecting a merger, capital share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. We have generated no operating revenues to date, and we do not expect that we will generate operating revenues until we consummate our initial business combination. Our sponsor is a newly incorporated Cayman Islands exempted company, formed by SHUAA Capital psc ( SHUAA Capital ). SHUAA Capital, established in 1979, is publicly listed on the Dubai Financial Market stock exchange and currently operates two key business segments: asset management and investment banking. SHUAA Capital is a leading asset management and investment banking platform in the Middle East region, with approximately $13 billion in assets under management. It is recognized for its strong track record and pioneering approach to investing through a differentiated, innovative and global product offering focused on public and private markets, debt and real estate. It also provides investment solutions to clients, with a focus on alternative investment strategies. SHUAA Capital s investment banking segment provides corporate finance advisory, transaction services, private placement and public offerings of equity and debt securities, while also creating market liquidity on over-the-counter fixed income products. SHUAA Capital is regulated as a financial investment company by the Securities and Commodities Authority of the United Arab Emirates and operates through regulated subsidiaries in the Kingdom of Saudi Arabia, Kuwait, Jordan and Turkey. Industry Trends While we may pursue an acquisition or a business combination target in any business, industry, or geography, we intend to focus our search on a target (our Target Business ) with business, or prospective operations within the technology ( tech ) and / or tech-enabled financial services ( fintech ) sectors, across the high growth markets of the Middle East, North Africa, and Turkey region (collectively, MENAT , or our Target Market ). The search for the Target Business will be tech-focused and sector-agnostic allowing us to fundamentally leverage new and growing trends within the tech sector and access companies that are targeting key areas for change within traditional business sectors. TABLE OF CONTENTS SUMMARY 1
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001899215_bigbear_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001899215_bigbear_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
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+++ b/parsed_sections/prospectus_summary/2022/CIK0001899215_bigbear_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001899259_pci_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001899259_pci_prospectus_summary.txt
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@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001902700_pioneer_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001902700_pioneer_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dcfac979b538c2e954c0633681dc3bcae5e8e40
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@@ -0,0 +1,274 @@
+PROSPECTUS SUMMARY
+
+ 
+
+This summary highlights
+information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing
+in the common stock of Pioneer Green Farms, Inc. (referred to herein as the Company, Pioneer, PGF, 
+ we, our, and us ). You should read this entire prospectus carefully, including Risk Factors, 
+ Management s Discussion and Analysis of Financial Condition or Plan of Operations, and our financial statements and
+the related notes appearing at the end of this prospectus, before making an investment decision.
+
+ 
+
+Overview
+
+ 
+
+Pioneer Green Farms Inc. formerly known as Pioneer
+Green LLC (the "Company" or "Pioneer") is a Florida corporation that was established in 2019 for the purpose
+of cultivating industrial hemp to provide full spectrum oil. The Company s business model is to grow hemp flowers from seeds to
+oil. The seed is planted and harvested then extracted to oil. The Company has engaged an extraction facility to extract the oil from
+the plants. However, in order to be efficient and to minimize costs, the extracting facility does not begin extracting oil until the
+harvest reaches 1500 pounds. Our harvest from 2020 was small since we had just started operations and is being stored at the extraction
+facility until we reach the 1500 pound minimum limit. As discussed below, we now operate at two locations and we expect that each harvest
+will meet more than the minimum 1500 pounds required for extraction. Our plan is to sell the extracted oil to wholesale buyers.. The
+goal is to create a CBD company that can produce high quality product. Pioneer leases farmland from Bernis C. Drymon and Sylvia Drymon,
+D/B/A Drymon Citrus Nursery. Pioneer currently operates 4 - 30 ft X 100 ft greenhouses at the Drymon Nursery, 2 of which are thoroughly
+outfitted with special lighting and other equipment designed to ensure uniform growing conditions after its initial buildout. All CBG,
+Pioneer s premium flower, is grown indoors under strict regulations approved by the State of Florida with all documentation at
+hand. In addition to hemp cultivation, at the Drymon Farm we are also producing peaches, lychee, dragon fruit, passion fruit and longan
+fruit stock trees for resale.
+
+ 
+
+In January 2022, the Company purchased a second
+location in Myakka City, Manatee County, Florida. This gives the Company the ability to more than double its crop output from Drymon
+Farm. The Company plans to begin to cultivate 8,000 plants in Spring 2022, outdoors at the Myakka location. In addition, the Company
+intends to build 7 green houses (30 ft X 100 ft) on the Myakka farm in 2022 with the ability to house 500 plants in each green house.
+In 2022, the Company expects to harvest approximately 16,000 plants at the Myakka farm and 7,000 plants from the Drymon farm. The Company
+is working at both locations and expects to continue to work each farm at full capacity. At each location,
+CBD flower is grown outdoors on several different plots of land within the Pioneer compound and the plants will be extracted for
+oil and will be sold to wholesale buyers. Any outdoor plants that cannot be extracted for their oil can be bagged and sold as flower. 
+Growing both indoors and outdoors enable the Company to reduce risks and better determine how to maximize its growing practices. 
+It also allows the Company to operate all year long, without regard to the change of seasons. There is 24/7 security with 6 full time
+and 2 part time employees with over 100 years of citrus farm experience overseeing the projects every day and communicating with the
+Pioneer team.
+
+ 
+
+Pioneer
+leases farmland from Bernis C. Drymon and Sylvia Drymon, D/B/A Drymon Citrus Nursery. Drymon has met all Florida THC testing and operations
+guidelines, as well as all facility inspections. Pioneer has applied for a license from the State of Florida, Department of Agriculture
+and Consumer Services for growing fruitstock trees. The license was received in March 2022. Drymon s Citrus Nursery
+has a license for hemp cultivation from the State of Florida Department of Agriculture and Consumer Services (the "Department").
+The Company s lease agreement with Drymon Nursery allows the Company to use and control the Drymon hemp cultivation license. In
+addition both Bernis C. Drymon and Sylvia Drymon are employees of the Company. The Company is using the Drymon Citrus Nursery hemp license
+for the Myakka, Florida location. The Department approved the Drymon license for use at the Myakka, Florida location.
+
+ 
+
+The initial crop in Florida was harvested
+in the Fall of 2020 and a Winter 2021 crop of 2000 plants have been planted for an expected March-April 2022 harvest timeline. The Company
+has engaged an extraction facility to extract the oil from the plants. However, in order to be efficient and to minimize costs, the extracting
+facility does not begin extracting oil until the harvest is 1500 pounds. The 2020 harvest is being stored until we reach the 1500 pound
+minimum needed for extraction. We expect to reach and exceed 1500 pounds in 2022. As a result, our 2020 harvest has not yet been sold
+for revenue.
+
+ 
+
+From seed to harvest, we oversee and manage the
+growing of our hemp plants. Seeds are planted and normally germinate within seven days. The germination process takes the same time whether
+it is planted outside in the field or in seven-gallon containers in the greenhouses. When the seeds sprout and begin to grow, it takes
+approximately three months to get to harvest, in both the field and in the greenhouses. Once the plants are harvested, the flower then
+dries for approximately two weeks. The flower is then sent to the extraction facility to extract the oil. Extraction begins when we reach
+1500 pounds of flower.
+
+ 
+
+At the planting, growing and harvesting stages,
+the Company cares for and closely monitors the plants to reduce the risk of loss at any stage. The Company ensures that plants are adequately
+watered, uses safe pest control measures to prevent loss, does soil testing, and regulates climate in the greenhouses. Due to the actions
+taken by the Company, risk of loss of the seeds and plants at these stages are minimal, except for extreme weather events that are out
+of the Company s control.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+We purchase our seeds from various suppliers.
+All of our seeds are certified by the Association of Official Seed Certifying Agencies ("AOSCA"). We have not encountered
+any difficulty in obtaining seeds to date and there are currently several seed producers and distributors from which we can purchase.
+However, as the number of hemp growers increase across the country, there is no assurance that this will not change, making seeds more
+difficult to obtain, if at all.
+
+ 
+
+AOSCA is an organization of agencies that provides
+internationally recognized seed certification and is dedicated to assisting plant breeders and seed producers in the production, identification,
+distribution, and promotion of certified classes of seed and other crop propagation materials.
+
+ 
+
+We are planting the same seeds indoors and outdoors.
+We are using the same certified seeds at the Myakka location that we use at Drymon farm. And will continue to grow under the State of
+Florida certified rules.
+
+ 
+
+We price our product to be competitive in our
+industry. We believe our prices are similar to other companies in the hemp business. We price our products at a fair value considering
+factors such as supply, demand, quality of product, and competition in our market. Our growing practices consist of seed to field to
+pot to extraction. All stages of the planting and growth of our crop are documented, including, planting dates, sprays, climate control,
+and soil testing. We do our own pre-testing in stages with a prominent laboratory that is approved by the Department. In addition, at
+least once a year, the Department sends an inspector to our locations to inspect our operations. The inspector cuts, bags and tests our
+hemp flowers using a third-party laboratory. The results go directly to the Compliance Department of the Department. We have not received
+any complaints or other corrective action or requests relating to inspections from the Department.
+
+ 
+
+Our hemp flower in storage is stored in a facility
+that has been meticulously designed to optimize cannabinoid preservation and integrity. Our stored flower is in good condition and will
+be extracted when we harvest in the summer of 2022. The facility laboratory performs regular checks on the storage environment, periodically
+assessing moisture and active water as well as testing for mycotoxins. With our new location at the Myakka property, and the number of
+greenhouses we are utilizing in both locations, we expect to harvest more than the required minimum flower for extraction at each harvest,
+reducing the need for storage for any extended periods of time going forward.
+
+ 
+
+Industrial hemp is a highly regulated crop across
+the world and licenses from state authorities are required to grow, process, distribute, and use these products. While hemp cultivation
+is legal in Florida, as long as a license is obtained, hemp cultivation in the various states and at the federal level remain in a state
+of flux.
+
+ 
+
+The Pioneer Green Farms team, consisting of 6
+full-time and 2 part time employees completed its first Spring planting in 2021 of 3500 CBD plants outdoors and 2000 CBG plants indoors.
+The plan originally called for the building of an oil extraction facility on site, but there are now services that can come to the farm
+at harvest time and extract the oil from the outdoor plants, negating the need for a major capital expenditure and enabling the Company
+to keep its operating costs at a minimum.
+
+ 
+
+While the hemp market is highly competitive and
+there are well established companies operating in the hemp space, we believe we have a competitive advantage because of our focus on
+implementing and maintaining quality sustainable growing practices, and competitive pricing.
+
+ 
+
+Corporate History
+
+ 
+
+The Company
+was first organized as Pioneer Green Farms, LLC in January 2019 as a Florida-based limited liability company (the LLC ).
+On May 10, 2021, Pioneer Green Farms, LLC converted into Pioneer Green Farms, Inc., a C corporation. Ownership interest in the LLC converted
+into a pro rata interest in shares of the C corporation. Members of the LLC, upon conversion, became shareholders of the Company with
+a corresponding ownership interest in the Company as the interest held in the LLC. The Company originally entered a joint-venture with
+Colorado- based Sugar Magnolia Hemp Farms LLC to cultivate hemp in the State of Colorado in 2019. Ten (10) acres of hemp were subsequently
+grown and harvested and that was the beginnings of the farming process.
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+Due to the Company being based in Florida, it
+decided to pursue hemp cultivation in the State of Florida when the State of Florida legalized hemp production in July 2019. The climate
+in Florida enables the farm to grow three to four crops per year with much lower overhead as opposed to Colorado where only one crop
+can be grown annually at higher operational costs in an extremely competitive Colorado marketplace. Pioneer Green Farms entered a 25-year
+lease of 5 acres from Drymon s Citrus Nursery ("Drymon s") of Sarasota, Florida. Drymon s has been involved
+in citrus farming in Florida for many decades and has met all the State s guidelines for licensed applicants. Drymon was granted
+a hemp cultivating license which Pioneer has a right to use and control pursuant to it s lease agreement with Drymon. Pioneer owns
+the farming infrastructure which is expansive and controls the revenues from the flower and oil extracts. In return, Drymon s will
+receive 10% of any net profits from the sale of the hemp products moving forward as part of the lease payment.
+
+ 
+
+In April 2020, Drymon s was granted a hemp
+cultivation license by the Plant Division of the Florida Department of Agriculture and Consumer Services. The Company uses and controls
+the Drymon hemp cultivation license, as part of its lease agreement with Drymon. Pioneer was able to build, construct and outfit 4 -
+30 ft x 100 ft greenhouses on Drymon s Nursery with water, lighting, and all equipment and specifications to ensure optimal uniform
+growing conditions and crop consistency approved by State regulations. Thirty-Five Hundred (3500) hemp plants consisting of CBD
+and CBG were systematically planted in stages and all aspects of the planting were carefully monitored and recorded, according to regulations
+and guidelines to build a comprehensive database for the farm. The Company s business model is focused on growing hemp, harvesting
+flower, and extracting oil for sale to wholesale buyers.
+
+ 
+
+In
+January 2022, the Company completed the purchase of over five (5) acres of farmland in Myakka City, Manatee County, Florida. The Company
+intends to expand its operations by building at least six (6) more greenhouses and planting over eight thousand (8,000) outdoor hemp
+plants. The Company expects that this new location will generate more than twice the oils as the Drymon location. In addition, the Company
+intends to build 7 green houses (30 ft X 100 ft) on the Myakka farm in 2022 with the ability to house 500 plants in each green house.
+In 2022, the Company expects to harvest approximately 8,000 plants at the Myakka farm and 3,500 plants from the Drymon farm in each harvest
+for a total of 16,000 from the Myakka farm and 7,000 from the Drymon farm. The Company is working at both locations and expects to continue
+to work each farm at full capacity. The Company is using the Drymon Citrus Nursery hemp license for the Myakka, Florida location.
+The Department approved the Drymon license for use at the Myakka, Florida location.
+
+ 
+
+Emerging Growth Company Status
+
+ 
+
+We are
+an emerging growth company as defined under the Jumpstart Our Business Startups Act, commonly referred to as the JOBS
+Act. We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of
+the fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer 
+as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that
+is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii)
+the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
+
+ 
+
+As an
+ emerging growth company, we may take advantage of certain exemptions from various reporting requirements that are applicable
+to other public companies that are not emerging growth companies including, but not limited to:
+
+ 
+
+ not
+ being required to comply with the auditor attestation requirements of Section 404(b) of the
+ Sarbanes-Oxley Act (we will also not be subject to the auditor attestation requirements of
+ Section 404(b) as long as we are a smaller reporting company, which includes
+ issuers that had a public float of less than $75 million as of the last business day of their
+ most recently completed second fiscal quarter);
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+ reduced disclosure
+ obligations regarding executive compensation in our periodic reports and proxy statements;
+ and
+
+ 
+
+ exemptions
+ from the requirements of holding a nonbinding advisory vote on executive compensation and
+ shareholder approval of any golden parachute payments not previously approved.
+
+ 
+
+In addition,
+Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period
+provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. Under this provision, an
+ emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply
+to private companies. However, we are choosing to opt out of such extended transition period, and as a result, we will
+comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging
+growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with
+new or revised accounting standards is irrevocable.
+
+ 
+
+Pioneer Green
+Farms, Inc., formerly known as Pioneer Green Farms LLC, is a Florida corporation, and the operator of the website, www.pioneergreenusa.com.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001907231_ace_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001907231_ace_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001918884_metaterra_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001918884_metaterra_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925549_qualtek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925549_qualtek_prospectus_summary.txt
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@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001927077_shonghoya_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001927077_shonghoya_prospectus_summary.txt
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@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001940322_medlab_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001940322_medlab_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..7116d5fc9d778b9ea0056107a45422c334a1900c
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in the Shares. You should read this entire prospectus, and the registration statement of which this prospectus is a part, including Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, and our consolidated financial statements and the related notes included elsewhere in this prospectus, before making an investment decision. Unless otherwise indicated or the context otherwise requires, Medlab, the Company, our company, we, us and our refer to Medlab Clinical Ltd. and its consolidated subsidiaries, taken as a whole. Overview Our legal name is Medlab Clinical Ltd. We are an Australian biotechnology company that formulates innovative solutions and innovative consumer health care products to provide integrative patient care. Our aim is to disrupt the multi-billion-dollar market of delivery platform technologies for pharmaceutical products that are designed to treat pain and mental health. We were incorporated in Australia in April 2014, and in 2015 listed on the ASX under the symbol MDC. Our corporate headquarters are located in Australia, and we maintain offices in the United States and Europe. Our mission is to create premier pharmaceutical drugs, therapies and delivery platforms for patients dealing with unmet medical needs, each of which will comply with applicable regulatory requirements, including the United States Food and Drug Administration ( FDA ), the European Medicines Association ( EMA ) and the Therapeutic Goods Administration of Australia ( TGA ), the medicine and therapeutic regulatory agency of the Australian Government. We aim to be recognized as a leading specialty drug development company, committed to restoring health and transforming the lives of patients through the development of novel pharmaceutical products and treatments. We develop targeted fixed-dose combinations of the NanoCelle delivery platform and various active pharmaceutical ingredients ( APIs ), applying proprietary insights to create long-term products that we believe will better meet the medical needs of our patients compared to what is currently available and that we believe will create value for our shareholders. Our focus is on clinical indications that we believe represent unmet or inadequately addressed medical needs and represent compelling commercial opportunities. We strongly believe there are considerable unmet needs of patients in our target markets, and that the current drug intervention therapies that are available can be significantly improved. We believe that we are able to provide these improvements to patients through products that we have and are developing. These products are discussed below. Though we do have sales from our products, we are primarily in a research and product development phase and do not generate significant revenue, except from research and development Australian federal grants and pharmaceutical products that we sell through special access pre-registration schemes. Accordingly, we have incurred recurring losses from operations. Our operations have been funded substantially through capital equity raising. Our focus is on raising capital through equity financings to fund future clinical trials. We believe the net proceeds of this offering, together with the Australian Research and Development Tax Incentive and our current cash, will be sufficient to meet our working capital and capital expenditure requirements at least through June 2023. Table of Contents Our Lead Product Candidate: NanoCelle NanoCelle , our core product offering, is a pharmaceutical-delivery platform which is designed to administer pharmaceutical products using nanoparticles, or small particles ranging between 1 to 100 nanometres in size and undetectable by the human eye. NanoCelle is an alternative, and, we believe, more effective method of consuming medical products compared to the traditional methods. NanoCelle delivery may include oromucosal (oro-buccal/sublingual) sprays, intranasal sprays, dermal and transdermal formulations, topical lotions, oral gel capsules and liquids, and adsorption from solid carriers. NanoCelle is designed to allow for vast improvements in patient care, quality of life and side effect reduction. Our primary and commercially available delivery platform, NanoCelle is now patented in several countries, including Australia, Canada, the European Union Countries(1), Hong Kong, New Zealand, the United States, the United Kingdom and with a pending patent application in Singapore, until 2036. In developing NanoCelle , we have placed a high research priority on tolerability, and without the use of harmful toxic products such as heavy metals or gases. To date, NanoCelle has administered over 350,000 doses of pharmaceutical products to patients through its delivery platform through compassionate use programs in the United Kingdom and Australia or clinical trials and/or sales of medicines approved by such governments or applicable pharmaceutical regulatory agents. The term compassionate use refers to a governmentally-sanctioned expedited pathway for a patient with an immediately life-threatening condition or serious disease or condition to gain access to an investigational medical product for treatment outside of clinical trials when no comparable or satisfactory alternative therapy options are available. (1) European Union Countries include Albania, Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Iceland, Italy, Lithuania, Luxembourg, Latvia, Malta, Monaco, Netherlands, North Macedonia, Norway, Poland, Portugal, Romania, San Marino, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland and Turkey. Our Other Drug Product Candidates, both in-market and in-development In addition to developing the NanoCelle delivery method, we have also developed several drug development programs that are specifically designed to be administered through the NanoCelle technology. Our NanoCelle delivery method has produced additional drug candidates which share design and chemistry, manufacturing and controls ( CMC ) processes with our lead candidate, resulting in tolerability profiles that may be similar to our lead product candidate, as well as regulatory agency familiarity, and a consistent multi-target therapeutic approach. Several of our products are listed, in contrast to being registered, with the Australian Register of Therapeutic Goods (the ARTG ). All medicines registered with the ARTG generally are evaluated for efficacy (that the medicine can do what it says it will) before they may be sold in Australia. However, not all listed medicines are evaluated for efficacy. Our registered medicines, such as NanaBis , are higher risk and, because of this, the ARTG fully assesses all registered medicines for safety, quality and efficacy before they go on sale. Registered medicines, which are intended to treat, manage and/or cure one or more conditions, require investment in clinical evidence with no guarantee of success at TGA. Listed medicines, such as NanoCelle D3 and NanoCelle B12, are lower risk and can be purchased off the shelf from pharmacies, health shops, and supermarkets. Listed products, such as complementary medicines and food supplements, are not exposed to the same risks and do not have to undergo the same rigorous regulatory assessments as registered products but are subject to a random audit after listing. As such, since our in-market drug products, are lower risk and do not go through pre-market assessment, they are considered ARTG-listed. Both ARTG-listed and ARTG-registered medicines must be manufactured in a licensed or approved facility in accordance with the principles of good manufacturing practice. There is no requirement under the ARTG for our products to be registered in their present form. Table of Contents Most therapeutic goods are required to undergo an evaluation for quality, safety and efficacy and be included in the ARTG before they can be supplied in Australia. In recognition that there are circumstances where patients need access to therapeutic goods that are not included in the ARTG, the TGA manages the Australian Special Access Scheme (the Special Access Scheme ). The Special Access Scheme allows registered health practitioners to access therapeutic goods (such as medicines, medical devices or biologicals) that are not included in ARTG for a single patient via approval by the TGA on a named patient basis. Therapeutic goods that are not included in the ARTG (and are not otherwise exempt from being in the ARTG) are described by us as unapproved . In addition to having our products listed and registered with the ARTG, we have also used drug master files in connection with our submissions to the FDA. Drug master files are submissions to the FDA used to provide confidential, detailed information about facilities, processes, or articles used in the manufacturing, processing, packaging, and storing of human drug products. The FDA will assess the drug master file with the Company s overall CMC package and clinical data packages. The drug master file forms part of the CMC package, which is a significant FDA requirement for a new drug application. The confidential information submitted to the FDA via a drug master file will be reviewed when the FDA reviews the application that references the drug master file, such as a New Drug Application ( NDA ) or Investigational New Drug ( IND ). To date, the Company has not made NDA or IND submissions. For more information on drug master files, please see the section entitled Business Drug Master Files. Our currently available products include the following: 1. NanoCelle D3 Designed to foster immunity and bone health, and currently an ARTG-listed product. This product is currently available through PharmaCare Laboratories Pty Ltd. ( PharmaCare ) in Australia over-the-counter in pharmacies and through healthcare providers and in New Zealand, operating under Medsafe, as a food supplement; 2. NanoCelle B12 Designed to reduce homocysteine levels and support the nervous system, and currently an ARTG-listed product. This product is currently available through PharmaCare in Australia over-the-counter in pharmacies and through healthcare providers and in New Zealand, operating under Medsafe, as a food supplement; 3. NanaBis cannabidiol ( CBD ) and tetrahydrocannabinol ( THC ) with an FDA active pharmaceutical ingredient ( API ) drug master file, and currently an ARTG-registered product. The intended use of NanaBis is for proposed indication of cancer-induced bone pain, with the goal of benefiting larger neuropathic pain populations. This product is available in Australia through the Australian Special Access Scheme ( Special Access Scheme ) and is scheduled to launch in the United Kingdom through the Named Patient Programme by the end of October 2022, whereby doctors seek government regulatory approval for use for patients on a case-by-case basis. NanaBis is pursuing FDA approval first and, if approved by the FDA, then will seek approval by the TGA and the European Medicines Agency ( EMA ). The NanaBis product is currently in Phase II trial studies conducted at an Australian Hospital and met all primary and secondary endpoints. During COVID, the company focused on the CMC and pivoted to 100% synthetics in accordance with prior FDA guidance. NanaBis , to date, has only conducted pharmacokinetic studies on advanced cancer patients and not healthy participants. However, the Company is expected to include pharmacokinetic studies on a small number of healthy participants in mid-2023. A Phase III trial for NanaBis , which is expected to include approximately 360 participants from the United States of America, Australia and the United Kingdom, will plan to use a randomized withdrawal method to demonstrate the analgesic tolerability and exploratory endpoints of NanaBis as a monotherapy in cancer patients. The Company expects to Table of Contents complete the Phase III clinical trials for NanaBis in the United States using the net proceeds from this offering, together with the Australian Research and Development Tax Incentive and existing cash. 4. NanoCBD - CBD with an FDA API drug master file for proposed indication of occupational stress, with the goal of benefiting mild, chronic pain populations. This product is available in Australia through the Special Access Scheme and is scheduled to launch in the United Kingdom through the Named Patient Programme by the end of October 2022, whereby doctors seek government regulatory approval for use for patients on a case-by-case basis. NanoCBD is an Australian TGA-lead trial for over-the-counter registered medicines targeting stress. Secondary regulatory agencies include both the Australian TGA and the EMA. NanoCBD is expected to undertake pharmacokinetic and pharmadynamic studies in healthy participants in mid-2023. In addition to developing the NanoCelle delivery method, we have also spearheaded several drug developmental programs that are specifically designed to be administered through the NanoCelle technology. Our NanoCelle delivery method has produced additional drug candidates which share design and CMC processes with our lead candidate, resulting in tolerability profiles that may be similar to our lead product candidate, as well as regulatory agency familiarity, and a consistent multi-target therapeutic approach. Our products that are currently in the earlier drug development stages include: 1. MDC2000 a product targeting major depressive disorders that has been optimized as a single molecule encapsulated in NanoCelle following clinical studies in 2020 that were closed early due to the COVID-19 pandemic. Based on this optimization, the program has returned to a pre-clinical stage with clinical returns expected in early 2023; and 2. NanoCelle -Nucleic Acid is expected to be TGA-focused with the intention to utilize the Company s NanoCelle delivery method for RNA COVID-19 vaccines. Nasal adherence studies for a NanoCelle insulin have been completed, demonstrating that the studies have met their endpoints. Our next step is to encapsulate siRNA within the NanoCelle and approach the Australian government for next potential steps. On April 4, 2022, we entered into a Collaborative Research Agreement with the University of New South Wales and Macquarie University to conduct testing during the pre-clinical stages for our NanoCelle -Nucleic Acid, a nasal vaccine delivery utilizing nucleic acid to develop a new vaccine and/or anti-viral technologies. Pursuant to the Collaborative Research Agreement, all intellectual property created or developed under such agreement is owned collectively by all parties to such agreement. Accordingly, we will not have full ownership over the intellectual property developed under the Collaborative Research Agreement, and any of our products incorporating such intellectual property will be subject to the joint ownership rights under the agreement. Our Strategy Our strategy is to expand our market opportunity by gaining United States, United Kingdom, Australian and/or other regulatory approval for our products. Furthermore, the superior performance that we believe we can achieve through our patented drug delivery platform, NanoCelle , will be a key differentiator for us in the pharmaceutical space. We are seeking to develop a body of clinical and real-world evidence and findings to support the benefits of our products. We intend to take several steps to achieve our goals, including: Advancing our novel investigational drug candidates towards approval in the United States and elsewhere; Developing future clinical products targeting unmet medical needs; Table of Contents Maintaining a strong intellectual property portfolio in key global markets, including Australia, Canada, the European Union Countries, Hong Kong, New Zealand, the United States, the United Kingdom and with a pending patent application in Singapore, until 2036; and Expanding the availability of our products globally and meeting applicable global regulatory and market needs. Our revenue strategy is premised around licensing our intellectual property and assets with large established companies that offer market expertise. We are seeking to benefit from the health care industry s search for delivery platforms across all molecules in the pursuit of better patient outlines. For example, over the past year, we have made several key strategic achievements and milestones, including: 1. Partnered with Purisys LLC ( Purisys ), a United States-based biosynthetic partner for FDA drug master files, for the two cannabinoids, CBD, and THC. It was noted at the time that the technology required for making a neat or 100% dronabinol (the synthetic of THC) was not commercially available. While working with Purisys in Georgia, the Company was able to deliver a 100% dronabinol, as well as a 100% cannabinoid with relevant documents for an FDA drug master files submission. The Company believes the biosynthetic partnership is a key strategic agreement/milestone. 2. Partnered with a strategic United States-based manufacturing company for (i) chemistry, manufacturing, and controls development for the cannabinoid programs; (ii) manufacturing optimisation and scale; and (iii) future commercial scale manufacture. 3. Secured patents in several countries for the NanoCelle delivery platform, including Australia, Canada, the European Union Countries, Hong Kong, New Zealand, the United States, the United Kingdom and with a pending patent application in Singapore, until 2036 across all territories. 4. Entered agreements with United Kingdom partners for the compassionate use of NanoCBD and NanaBis to at-risk patients. 5. Entered agreements with Macquarie University and the University of New South Wales for the joint development of NanoCelle -Nucleic Acid, as a nasal delivery for vaccines. 6. Strengthened our datapoints from our Australian data bank to understand sustainability of the NanaBis program over 6 to 12 months and tolerability as it relates to adverse events and in relation to opioid products. The Company has currently licensed its commercial IP to the following entities: 1. PharmaCare Licensed to use Nanocelle D3 and Nanocelle B12 in TGA-listed medicines in Australia and New Zealand only for the nutraceuticals. 2. Cultech Ltd. Licensed to use NRGBiotic in TGA-listed medicine and is United Kingdom exclusive and U.S. nonexclusive; 3. YesHealth Sdn Bhd. Licensed to use several TGA-listed medicines (not including the NanoCelle ) and is Malaysia and Vietnam exclusive and Singapore nonexclusive; and 4. American Nutritional Corporation Inc. Licensed several TGA-listed medicines inclusive of those NanoCelles in existing range (Nanocelle D3 and Nanocelle B12) and is U.S. exclusive under their private label called NuScripts. Table of Contents NanoCelle Technology Transfer Licenses for Manufacturing: 1. Renaissance Lakewood LLC ( Renaissance ) a U.S. Contract Development and Manufacturing Organization experienced in FDA and U. S. Drug Enforcement Administration ( DEA ) drugs and manufacturing; 2. Natural Factors a Canadian nutraceutical manufacturing facility approved by TGA; 3. Extractas (formerly known as Tasmanian Alkaloids) an Australian experienced poppy grower and manufacturer for medicines that is approved by TGA; and 4. Universities New South Wales and the Woolcott Institute of Macquarie University research collaboration partners for the NanoCelle -Nucleic Acid nasal vaccine program. Corporate Information Our registered office is located at Units 5 and 6, 11-13 Lord Street, Botany, New South Wales, 2019, Australia and our telephone number is +61 2 8188 0311. Our website address is www.medlab.co. The information on, or accessible through, our website is not part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. All information we file with the SEC is available through the SEC s Electronic Data Gathering, Analysis and Retrieval system, which may be accessed through the SEC s website at www.sec.gov. Implications of Being an Emerging Growth Company As a company with less than US$1.235 billion in revenue during our last fiscal year, we qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies. These provisions include: exemption from the auditor attestation requirement of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ) in the assessment of our internal controls over financial reporting; to the extent that we no longer qualify as a foreign private issuer, (i) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and (ii) exemptions from the requirements of holding a non-binding advisory vote on executive compensation, including golden parachute compensation; and an exemption from compliance with the requirement that the Public Company Accounting Oversight Board has adopted regarding a supplement to the auditor s report providing additional information about the audit and the financial statements. We may take advantage of these exemptions until such time that we are no longer an emerging growth company. Accordingly, the information that we provide shareholders and holders of the Shares may be different than you might obtain from other public companies. We will cease to be an emerging growth company upon the earliest to occur of (i) the last day of the fiscal year in which we have more than US$1.235 billion in annual revenue; (ii) the last day of the fiscal year in which we qualify as a large accelerated filer ; (iii) the date on which we have, during the previous three-year period, issued more than US$1.0 billion in non-convertible debt securities; and (iv) the last day of the fiscal year in which the fifth anniversary of this offering occurs. Table of Contents Implications of Being a Foreign Private Issuer We also qualify as a foreign private issuer under U.S. securities laws. In our capacity as a foreign private issuer, we are exempt from certain rules under the Exchange Act that impose certain disclosure obligations and procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, our senior management, the members of our board of directors and our principal shareholders are exempt from the reporting and short-swing profit recovery provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of our securities. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. In addition, we are not required to comply with Regulation FD, which restricts the selective disclosure of material information. We may take advantage of these exemptions until such time as we are no longer a foreign private issuer. Unless we elect to terminate our status as a foreign private issuer, we will remain a foreign private issuer until such time that 50% or more of our outstanding voting securities are held by U.S. residents and any of the following three circumstances applies: (i) the majority of the members of board of directors or our senior management are U.S. citizens or residents; (ii) more than 50% of our assets are located in the United States; or (iii) our business is administered principally in the United States. Risk Factors Summary Our business is subject to a number of risks of which you should be aware prior to making a decision to invest in our Shares. You should carefully consider all of the information set forth in this prospectus and, in particular, you should evaluate the specific factors set forth in the section titled Risk Factors before deciding whether to invest in our Shares. Among these important risks are, but not limited to, the following: We are subject to going-concern risks. Escalating global trade tensions, the conflict between Russia and Ukraine, and the adoption or expansion of economic sanctions or trade restrictions could negatively impact us. The increase in expenses may adversely impact our business if our sources of funding and revenue are insufficient. We will require additional financing and may be unable to raise sufficient capital, which could have a material adverse impact on our research and development programs or commercialization of our drug candidates. We do not own full rights to the intellectual property developed pursuant to our collaborative research agreement with the University of New South Wales and Macquarie University (the Collaborative Research Agreement ). We may find it difficult to enroll patients in our current and any future clinical trials, and patients could discontinue their participation in our current and any future clinical trials, which could delay or prevent our current and any future clinical trials of our drug candidates and make those trials more expensive to undertake. Positive results from preclinical studies of our drug candidates are not necessarily predictive of the results of our planned clinical trials of our drug candidates. Ongoing and future clinical trials of drug candidates may not show sufficient safety and efficacy to obtain requisite regulatory approvals for commercial sale. Table of Contents If we do not obtain the necessary regulatory approvals, we may be unable to commercialize our drug candidates. Even if our drug candidates receive regulatory approval, it may still face development and regulatory difficulties that may delay or impair future sales of drug candidates. Cannabis continues to be a controlled substance under the United States Federal Controlled Substances Act ( CSA ) and our business may result in federal civil or criminal prosecution. The regulatory approval processes of the FDA, the EMA and other comparable foreign regulatory authorities are lengthy, time-consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidates, our business will be substantially harmed. We depend on, and will continue to depend on, collaboration and strategic alliances with third partners. To the extent we are able to enter into collaborative arrangements or strategic alliances, we will be exposed to risks related to those collaborations and alliances. Because we rely on third-party manufacturing and supply partners, our supply of research and development, preclinical and clinical development materials may become limited or interrupted or may not be of satisfactory quantity or quality. Future potential sales of our drug candidates may suffer if they are not accepted in the marketplace by physicians, patients and the medical community. We face competition from entities that may develop drug candidates for our target disease indications, including companies developing novel treatments and technology platforms based on modalities and technology similar to ours. If healthcare insurers and other organizations do not pay for our drug candidates or impose limits on reimbursement, our future business may suffer. We may be exposed to product liability claims which could harm our business. The continuing COVID-19 pandemic could adversely impact our business, including our non-clinical studies and clinical trials. The success of our prospective product candidates and future approved products, if any, especially those containing cannabinoids, are subject to a number of constantly evolving state and federal laws, regulations, and enforcement policies pertaining to cannabis and/or cannabis derivatives. The approach to the enforcement of cannabis laws may be subject to change, which may create uncertainty for our business. Research regarding the medical benefits, viability, safety, efficacy, use and social acceptance of cannabis or isolated cannabinoids (such as CBD and THC) remains in early stages. Our NanaBis and NanoCBD use of CBD and THC individually and/or in combination, are subject to U.S. and international controlled substance laws and regulations; our ability to commercialize any product containing these substances will depend, in part, on the ultimate classification of the product under these laws and regulations. Our drug candidates may be subject to controlled substance laws and regulations. Failure to receive necessary approvals may delay the launch of our drug candidates and failure to comply with these laws and regulations may adversely affect the results of our business operations. Our success depends on our ability to protect our intellectual property and our proprietary technology. Intellectual property rights of third parties could adversely affect our ability to commercialize our drug candidates, such that we could be required to litigate with or obtain licenses from third parties in order to develop or market our drug candidates. Table of Contents Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements. Intellectual property rights do not address all potential threats to our competitive advantage. We may face difficulties with protecting our intellectual property in certain jurisdictions, which may diminish the value of our intellectual property rights in those jurisdictions. Price controls may be imposed in markets in which we operate, which may negatively affect our future profitability. The trading price of the Shares may be volatile, and purchasers of the Shares could incur substantial losses. The requirements of being a public company may strain our resources and divert management s attention and if we are unable to maintain effective internal control over financial reporting in the future, the accuracy and timeliness of our financial reporting may be adversely affected. We are eligible to be treated as an emerging growth company as defined in the JOBS Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Shares less attractive to investors. There is no public market for the Pre-Funded Warrants or the Share Purchase Warrants being offered by us in this offering. You will experience immediate and substantial dilution in the net tangible book value of the Shares you purchase in this offering. Our issuance of additional Shares in connection with financings, acquisitions, investments, or otherwise will dilute all other Shareholders. As long as we remain subject to the rules of the ASX and Nasdaq, we will be unable to access equity capital without shareholder approval if such equity capital sales would result in an equity issuance above regulatory thresholds and, consequently, we could be unable to obtain financing sufficient to sustain our business if we are unsuccessful in soliciting requisite shareholder approvals. The dual listing of our Shares following this offering may negatively impact the liquidity and value of the Shares. We are subject to risks associated with currency fluctuations, and changes in foreign currency exchange rates could impact our results of operations. As a foreign private issuer whose shares are listed on Nasdaq, we may follow certain home country corporate governance practices instead of certain Nasdaq requirements. Special Note Regarding Forward-Looking Statements This prospectus contains forward-looking statements about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this prospectus, including statements regarding our future results of operations, financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as anticipate, believe, contemplate, continue, could, estimate, expect, intend, may, plan, potential, predict, project, should, target, will, or would, or the negative of these words or other similar terms or expressions. Table of Contents We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements are subject to a number of known and unknown risks, uncertainties, other factors and assumptions, including the risks described in Risk Factors and elsewhere in this prospectus, regarding, among other things: our product development and business strategy, including the potential size of the markets for our drug candidates and future development and/or expansion of our drug candidates in our markets; our current and future research and development activities, including clinical testing and manufacturing and the costs and timing thereof; our future projections on the amount of our cash necessary to support working capital and capital expenditure requirements; the impact that the COVID-19 pandemic could have on business operations; the impact that political instability and international hostilities, including the ongoing aggression between Russia and Ukraine, could have on business operations and agreements with third parties; sufficiency of our cash resources; our ability to commercialize drug candidates and generate product revenues; our ability to raise additional funding when needed; any statements concerning anticipated regulatory activities or licensing or collaborative arrangements, including our ability to obtain regulatory clearances; our research and development and other expenses; our operations and intellectual property risks; our ability to remain compliant with the ASX s and Nasdaq s continuing listing standards; any statement of assumptions underlying any of the foregoing; and other risks and uncertainties, including those listed under Risk Factors . These risks are not exhaustive. Other sections of this prospectus may include additional factors that could harm our business and financial performance. New risk factors may emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in, or implied by, any forward-looking statements. You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this prospectus primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. We undertake no obligation to update any forward-looking statements made in this prospectus to reflect events or circumstances after the date of this prospectus or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments. In addition, statements that we believe and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this prospectus. Table of Contents While we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements. You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and achievements may be different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Table of Contents
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+S-1/A 1 d308512ds1a.htm S-1/A S-1/A Table of Contents As filed with the Securities and Exchange Commission on May 2, 2022 Registration No. 333-263449 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 PRE-EFFECTIVE AMENDMENT NO. 1 TO THE FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ECB Bancorp, Inc. (Exact Name of Registrant as Specified in Its Charter) Maryland 6036 88-1502079 (State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer incorporation or organization) Classification Code Number) Identification Number) 419 Broadway Everett, Massachusetts 02149 (617) 387-1110 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant s Principal Executive Offices) Richard J. O Neil, Jr. President and Chief Executive Officer 419 Broadway Everett, Massachusetts 02149 (617) 387-1110 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) Copies to: Steven Lanter, Esq. Lawrence M.F. Spaccasi, Esq. Luse Gorman, PC 5335 Wisconsin Avenue, N.W., Suite 780 Washington, D.C. 20015 (202) 274-2000 Michael K. Krebs, Esq. Nutter McClennen & Fish LLP 155 Seaport Boulevard Boston, MA 02210 (617) 439-2288 Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: If this Form is filed to register additional shares for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act.: Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents PROSPECTUS ECB Bancorp, Inc. (Proposed Holding Company for Everett Co-operative Bank) Up to 10,637,500 shares of Common Stock (Subject to increase to up to 12,233,125 shares) ECB Bancorp, Inc., a Maryland corporation, and the proposed holding company for Everett Co-operative Bank, is offering shares of common stock for sale in connection with the conversion of Everett Co-operative Bank from the mutual to stock form of organization. All shares of common stock are being offered for sale at a price of $10.00 per share. Purchasers will not pay a commission to purchase shares of common stock in the offering. There is currently no public market for the shares of our common stock. We expect that upon conclusion of the offering our common stock will be listed on the Nasdaq Capital Market under the symbol ECBK. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012. We are offering up to 10,637,500 shares of common stock for sale on a best efforts basis. We may sell up to 12,233,125 shares of common stock because of demand for the shares or changes in market conditions without resoliciting subscribers. We must sell a minimum of 7,862,500 shares in order to complete the offering. We are offering the shares of common stock in a subscription offering to eligible depositors. Shares of common stock not purchased in the subscription offering may be offered for sale to the general public in a community offering with a preference given to residents of the following Massachusetts towns and cities: Everett, Malden, Medford, Melrose, North Reading, Somerville, Stoneham, Wakefield, Danvers, Middleton, Lynn, Lynnfield, Peabody, Saugus, Chelsea, East Boston, Revere and Winthrop. Any shares of common stock not purchased in the subscription offering or community offering may be offered for sale in a syndicated community offering to be managed by Keefe, Bruyette & Woods, Inc. In addition to the shares that we will sell in the offering, we will also contribute cash and stock to a charitable foundation that we are establishing in connection with the conversion, such contribution to consist of $600,000 in cash and 260,000 shares of our common stock, for a total contribution of $3,200,000 based on the $10.00 per share purchase price. The minimum purchase order is 25 shares. Generally, no individual, or individuals acting through a single qualifying account held jointly, may purchase more than 35,000 shares ($350,000) of common stock, and no person or entity, together with associates or persons acting in concert with such person or entity, may purchase more than 50,000 shares ($500,000) of common stock in all categories of the offering combined. Stock orders must be received by us before 2:00 p.m., Eastern Time, on June 15, 2022. Orders received after 2:00 p.m., Eastern Time, on June 15, 2022 will be rejected unless we extend this expiration date. We may extend this expiration date without notice to you until August 1, 2022, or such later date as the Federal Reserve Board, the Federal Deposit Insurance Corporation and the Massachusetts Commissioner of Banks may approve, to the extent such approval is required, which may not be beyond March 9, 2024. Once submitted, orders are irrevocable unless the offering is terminated or is extended beyond August 1, 2022, or the number of shares of common stock to be sold is increased to more than 12,233,125 shares or decreased to less than 7,862,500 shares. If the offering is extended past August 1, 2022, you will have the opportunity to confirm, change or cancel your order within a specified period of time. If you do not respond during that period, your stock order will be cancelled and your deposit account withdrawal authorizations will be cancelled or your funds submitted will be returned promptly with interest at 0.05% per annum. If the number of shares to be sold is increased to more than 12,233,125 shares or decreased to less than 7,862,500 shares, all funds submitted for the purchase of shares of common stock in the offering will be returned promptly with interest at 0.05% per annum. In this case, all subscribers will be given an opportunity to place a new order within a specified period of time. Funds received in the subscription and the community offerings will be held in a segregated account at Everett Co-operative Bank and will earn interest at 0.05% per annum until completion or termination of the offering. Keefe, Bruyette & Woods, Inc. will assist us in selling the shares on a best efforts basis in the subscription and community offerings, and will serve as sole manager for any syndicated community offering. Keefe, Bruyette & Woods, Inc. is not required to purchase any shares of common stock that are sold in the offering. This investment involves a degree of risk, including the possible loss of your investment. Please read Risk Factors beginning on page 18. OFFERING SUMMARY Price: $10.00 per Share Minimum Midpoint Maximum Adjusted Maximum Number of shares 7,862,500 9,250,000 10,637,500 12,233,125 Gross offering proceeds $ 78,625,000 $ 92,500,000 $ 106,375,000 $ 122,331,250 Estimated offering expenses, excluding selling agent fees and expenses (1) (2) $ 1,166,250 $ 1,166,250 $ 1,166,250 $ 1,166,250 Selling agent fees and expenses (1) $ 1,077,250 $ 1,216,000 $ 1,354,750 $ 1,514,313 Estimated net proceeds $ 76,381,500 $ 90,117,750 $ 103,854,000 $ 119,650,687 Estimated net proceeds per share (1) $ 9.71 $ 9.74 $ 9.76 $ 9.78 Table of Contents our freezing of and withdrawal from a defined benefit plan. Our current business strategy includes continuing to focus on growing our commercial real estate and multifamily lending portfolios as well as our one- to four-family residential real estate loan portfolio. By growing our commercial real estate and multifamily loans, we also will continue to focus on growing commercial deposit relationships to grow our core source of funds. Additionally, we intend to continue to focus on expanding our online banking products and services to ensure that our customers continue to enjoy the local bank experience with optimal convenience and efficiencies necessary to compete with larger financial institutions. Everett Co-operative Bank is subject to comprehensive regulation and examination by the Massachusetts Commissioner of Banks (the Commissioner ), as its chartering agency, and the Federal Deposit Insurance Corporation ( FDIC ) as its primary federal regulator and primary insurer of its deposits. Our executive offices are located at 419 Broadway, Everett, Massachusetts 02149. Our telephone number at this address is (617) 387-1110. Our website address is www.everettbank.com. Information on our website is not incorporated into this prospectus and should not be considered part of this prospectus. See Business of Everett Co-operative Bank. The following diagram shows our organizational structure as of December 31, 2021 as a mutual co-operative bank with no shareholders: EVERETT CO-OPERATIVE BANK (a Massachusetts-chartered mutual cooperative bank) After the conversion and offering are completed, we will be organized as a fully public stock holding company, as follows: PUBLIC STOCKHOLDERS (including charitable foundation) 100% ECB BANCORP, INC. (a Maryland corporation) 100% EVERETT CO-OPERATIVE BANK (a Massachusetts-chartered stock cooperative bank) Table of Contents See The Conversion and Plan of Distribution; Marketing and Distribution; Compensation for a discussion of Keefe, Bruyette & Woods, Inc. s compensation for this offering and the compensation to be received by Keefe, Bruyette & Woods, Inc. and the other broker-dealers that may participate in the syndicated community offering. Excludes records agent fees and expenses payable to Keefe, Bruyette & Woods, Inc., which are included in estimated offering expenses. See The Conversion and Plan of Distribution; Marketing and Distribution; Compensation. These securities are not deposits or savings accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation, any other government agency, or the Massachusetts Depositors Insurance Fund. Neither the Securities and Exchange Commission, the Board of Governors of the Federal Reserve System, the Massachusetts Commissioner of Banks, the Federal Deposit Insurance Corporation, nor any state securities regulator has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. For assistance, please call the Stock Information Center, toll free, at (877) 821-5783. Keefe, Bruyette & Woods A Stifel Company The date of this prospectus is [prospectus date]. Table of Contents Business Strategy We intend to operate as a well-capitalized and profitable community bank dedicated to providing exceptional personal service to our individual and business customers. Enhanced Management Team and Modified Business Strategy In recent years, we have focused on building an experienced management team and revising our operating and business strategy. In 2016 we hired our Chief Executive Officer, Richard O Neil, who, prior to his hiring, had served as outside general counsel and has been a board member of Everett Co-operative Bank since 1997. In 2019, we hired John Citrano, our Executive Vice President, Chief Operating Officer and Chief Financial Officer. Mr. Citrano has 33 years of experience in the financial services industry including his role as Chief Financial Officer of a publicly traded community bank in the greater Boston area. Under Messrs. O Neil s and Citrano s leadership, we conducted an extensive review of our loan operations, retail and branch marketing and information technology strategies, and, with the recent hiring of several seasoned bankers and operations staff, we have enhanced and expanded our operations and increased our focus on our commercial real estate lending and our commercial banking relationships. We have also focused on improving our services and delivery channels, including our digital delivery channels and services for our commercial customers. One of the key features of our recently modified business strategy is to grow our loan portfolio, primarily through an increased focus on growing our commercial real estate and multifamily lending operations. In order to further enhance our commercial real estate and multifamily lending infrastructure and continue to grow our portfolio, in January 2022, we hired a new Chief Lending Officer, John Migliozzi, who has over 35 years of lending experience in the greater Boston metropolitan area, and we expect to hire additional lending and credit analyst personnel after completion of the conversion, including additional experienced commercial lenders. Consistent with our strategy to grow our commercial loan operations and the consequent commercial relationship opportunities that may be presented by our increased activity in the commercial real estate market, we are in the process of upgrading our suite of deposit products and related services and are upgrading our digital and mobile applications in order to accommodate business customers and thereby accelerate the growth in our core deposits. Historically, given our size, capital position and lending team experience and capacity, we have originated for participation to other local banking institutions our larger commercial real estate and commercial loans. Despite these loans being originated under prudent standards and our desire to retain and portfolio these larger loans, we generally have not held any loan or portion of a loan we originated in excess of $8.4 million. As we continue to enhance our commercial real estate team and infrastructure and with the increase in capital resulting from the conversion, we will be able to selectively retain larger loans that we historically would have originated for participation with other local institutions. In this regard, we will be revising our lending policies and loans to one borrower limitations to increase our lending limits and the type and size of loans we choose to portfolio. We are similarly focused on enhancing our retail operations. In November 2021 we hired Cary Lynch as our new Senior Vice President of Retail Operations. Mr. Lynch has 35 years of community banking experience, including 30 years in the greater Boston metropolitan area, and he is overseeing our efforts to ensure that our products, services and accessibility will continue to make Everett Co-operative Bank a competitive community bank, and will continue to attract and retain retail customers by emphasizing personal service, accessibility and flexibility in the face of mass market-oriented large, Table of Contents Table of Contents national and super-regional banks which maintain local branch networks in our market. Some of the programs and efforts we are pursuing in these areas include: introducing a new mobile and on-line bank interface; offering branded consumer credit and business credit cards; offering merchant services programs to enhance the small business customer experience at Everett Co-operative Bank; and providing new on-line account operations to enhance and facilitate new customer acquisitions. Finally, in recognition of our expected growth through the above-mentioned efforts and in anticipation of becoming a public company with the attendant accounting and financial reporting obligations, in 2021 we hired a Senior Vice President and Chief Accounting Officer who has 17 years of public company accounting and community banking experience, including having served in a chief accounting role at a publicly traded community bank in the greater Boston metropolitan area. These efforts, and especially the hirings of the executive officers, have and will continue to increase non-interest expense, including our compensation and benefits expense and technology and operational expenses, which will affect our net income in 2022 and thereafter, but we believe our recent hires and operational measures will create the framework for us to execute on our strategy to grow the Bank through orderly and diligent loan growth, including competing for and underwriting larger individual loans and maintaining larger lending relationships. Similarly, we believe that we are well-positioned to execute on our retail growth strategy including our increased emphasis on retail sales marketing efforts by Bank personnel, the implementation of opening accounts online and enhanced mobile and electronic banking products and services. We have and expect to continue to invest in our personnel and information technology and as needed, we will add additional business development personnel, all of which will increase our overall expenses. We believe we have been effective in competing against both larger regional banks and local community banks operating in our market. We compete against the larger banks through our responsive and personalized service, providing our customers with quicker decision making, customized products where appropriate and access to our senior managers. We believe our highly experienced commercial and residential bankers and a sophisticated product and service mix, including a suite of technology solutions and support, enable us to compete effectively against local community banks. We believe that recent consolidation of financial institutions in and around our market continues to create further opportunity for expansion in our market and hiring available personnel. We will continue to emphasize these core business principles as we focus on growing our balance sheet and will implement them with the larger banking relationships that we seek to originate and maintain. We believe that we have a competitive advantage in the market we serve because of our knowledge of the local marketplace and our long-standing history of providing superior, relationship-based customer service. Highlights of our current business strategy include: continuing to focus on orderly and diligent growth of our commercial real estate and multifamily loan portfolios, including competing for and underwriting larger loans and maintaining larger lending relationships; continuing to focus on one- to four-family residential real estate lending; maintaining our strong asset quality through prudent loan underwriting; continuing to attract and retain customers in our market area and build our core deposits consisting of interest-bearing and noninterest-bearing checking, savings and money market accounts; Table of Contents remaining a community-oriented institution and relying on high quality service to maintain and build a loyal local customer base; and expanding our banking franchise as opportunities arise through one or more de novo branches and/or branch acquisitions, although we do not currently have any understandings or arrangements to establish or acquire any new branch offices. These strategies are intended to guide our investment of the net proceeds of the offering. We intend to continue to pursue our business strategy after the conversion and the offering, subject to changes necessitated by future market conditions and other factors. See Business of Everett Co-operative Bank and Management s Discussion and Analysis of Financial Condition and Results of Operations Business Strategy for a further discussion of our business strategy. Reasons for the Conversion We believe the stock form of organization will provide us with access to additional resources to expand the products and services we offer our customers. Management believes that the additional capital raised in the offering will enable us to take advantage of business opportunities that may not otherwise be available to us, while allowing us to retain our commitment to remaining an independent community bank. Our primary reasons for converting and raising additional capital through the offering are to: increase our capital to enhance our financial strength; support future lending in an orderly and diligent manner, including, in particular, our commercial real estate and multifamily lending and our one- to four-family residential real estate lending; enable us to compete for, originate and retain larger loans and maintain larger lending relationships, particularly loans and relationships in our local community, thereby allowing us to maintain a reputation as a locally managed community lender; increase deposits; invest in new technologies and personnel that will enable us to expand and enhance our products and services; support our banking franchise as opportunities arise through de novo branching and/or branch acquisitions; attract and retain qualified personnel by enabling us to establish stock-based benefit plans for management and employees that will give them an opportunity to share in our long-term success; enhance our community ties by providing customers and members of our community with the opportunity to acquire an ownership interest in ECB Bancorp and Everett Co-operative Bank; and establish a foundation to support charitable organizations operating in our local communities now and in the future and fund the foundation with shares of our common stock and cash. Table of Contents SUMMARY The following summary explains the significant aspects of Everett Co-operative Bank s mutual-to-stock conversion and the related offering of ECB Bancorp, Inc. common stock. It may not contain all of the information that is important to you. For additional
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires: references to amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that we have adopted; references to we, us or our company are to Embrace Change Acquisition Corp., a Cayman Islands exempted company; references to China or the PRC refer to the People s Republic of China, including Hong Kong and Macau; references to the Companies Act are to the Companies Act (2021 Revision) of the Cayman Islands as the same may be amended from time to time; references to founder shares are to the 1,868,750 ordinary shares currently held by the initial shareholders (as defined below), which include up to an aggregate of 243,750 ordinary shares subject to forfeiture by our initial shareholders to the extent that the underwriters over-allotment option is not exercised in full or in part; references to our initial shareholders are to our sponsor and any other holder of founder shares, including our officers and directors; references to ordinary shares are to our ordinary shares, par value of US$0.0001 per share; references to our management or our management team are to our officers and directors; references to our private shares are to the ordinary shares included in the private units; references to our private units are to the units, each consisting of one ordinary share, one warrant and one right, that our initial shareholders are purchasing privately from us in a private placement concurrent with this offering, as well as any units issued upon conversion of working capital loans; references to our private warrants are to the warrants included in the private units; references to our private rights are to the rights included in the private units; references to our public shares are to ordinary shares which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and references to public shareholders refer to the holders of our public shares, including our initial shareholders to the extent our initial shareholders purchase public shares, provided that their status as public shareholders shall exist only with respect to such public shares; references to our public warrants are to the redeemable warrants sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); references to our public rights are to the rights sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); references to the representative are to EF Hutton, division of Benchmark Investments, LLC, the representative of the underwriters; references to our sponsor are to Wuren Fubao Inc., a Cayman Islands exempted company; references to our warrants are to the public warrants as well as the private warrants and any warrants included in private units issued upon conversion of working capital loans; and Table of Contents references to our rights are to the public rights as well as the private rights and any rights included in private units issued upon conversion of working capital loans. All references in this prospectus to our shares being forfeited shall take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. All references in this prospectus to share dividends shall take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. On October 24, 2021, we declared a dividend of 0.50 shares for each outstanding share, resulting in 2,156,250 shares being outstanding. On July 1, 2022, the sponsor surrendered an aggregate of 287,500 founder shares for no consideration, resulting in 1,868,750 shares being outstanding. This number includes an aggregate of up to 243,750 shares that are subject to forfeiture if the over-allotment option is not exercised by the underwriters. You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not, and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted. General We are a blank check company newly incorporated as a Cayman Islands exempted company on March 3, 2021. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with section 6 of the Tax Concessions Act (2018 Revision) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We were incorporated for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities, which we refer to as a target business. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location. We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction with our company. Although our sponsor and certain members of our board of directors and management have significant business ties to or are based in the People s Republic of China, we have determined that because of uncertainties in the regulatory climate in these jurisdictions, and the potential for future governmental actions which might unfavorably impede future operations, we will not consider or undertake a business combination with an entity or business based in, or with its principal or a majority of its business operations (either directly or through any subsidiaries) in, the People s Republic of China (including Hong Kong and Macau), and, for the avoidance of doubt, we will not enter into an agreement for, or consummate our initial business combination with, such an entity or business, or consummate our initial business combination in circumstances where we are the counterparty to a VIE or other arrangement with a China-based entity. Since many of our officers and directors have business experience in China or reside in China, not being able to target a business in China may make it more difficult to find an attractive target business outside of China, and it may make us a less attractive partner to non-Hong Kong and non-People s Republic of China targets. Because our offices are in the United Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JULY 25, 2022 $65,000,000 Embrace Change Acquisition Corp. 6,500,000 Units Embrace Change Acquisition Corp. is a blank check company newly incorporated as a Cayman Islands exempted company for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic region. We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction with our company. This is an initial public offering of our securities. We are offering 6,500,000 units at an offering price of $10.00. Each unit consists of one ordinary share, one warrant, which we refer to throughout this prospectus as the public warrants , and one right, which we refer to throughout this prospectus as the public rights . Each whole warrant entitles the holder thereof to purchase one ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus. Each warrant will become exercisable 30 days after the completion of an initial business combination and will expire on the fifth anniversary of our completion of an initial business combination, or earlier upon redemption or liquidation. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Each right entitles the holder thereof to receive one-eighth (1/8) of one ordinary share upon consummation of our initial business combination, so you must hold rights in multiples of 8 in order to receive shares for all of your rights upon closing of our initial business combination. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 and will therefore be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 24 for a discussion of information that should be considered in connection with an investment in our securities. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation to subscribe for securities may be made to the public in the Cayman Islands. Price to Public Underwriting Discounts and Commissions(1) Proceeds, Before Expenses, to us Per Unit $ 10.00 $ 0.45 $ 9.55 Total $ 65,000,000 $ 2,925,000 $ 62,075,000 (1) Includes $0.35 per unit, or $2,275,000 in the aggregate, payable to the underwriters for deferred underwriting commissions that will be placed in a trust account located in the United States. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Upon consummation of the offering, $10.25 per unit sold to the public in this offering (whether or not the over-allotment option has been exercised in full or part) will be deposited into a United States-based trust account with Continental Stock Transfer & Trust Company acting as trustee. Except as described in this prospectus, these funds will not be released to us until the earlier of (1) the completion of our initial business combination within the required time period; (2) our redemption of 100% of the outstanding public shares if we have not completed an initial business combination in the required time period; and (3) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption rights as described herein or redeem 100% of our public shares if we do not complete our initial business combination within the required time period or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity. The underwriters are offering the units on a firm commitment basis. The underwriters expect to deliver the units to purchasers on or about , 2022. Sole Book-Running Manager EF HUTTON division of Benchmark Investments, LLC Co-Manager TIGER BROKERS , 2022 We have also granted EF Hutton, division of Benchmark Investments, LLC, the representative of the underwriters, a 45-day option to purchase up to an additional 975,000 units (over and above the 6,500,000 units referred to above) solely to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem their ordinary shares upon the consummation of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below, including interest (net of taxes payable), divided by the number of then issued and outstanding ordinary shares that were sold as part of the units in this offering, which we refer to as our public shares. We have 12 months (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) from the closing of this offering to consummate our initial business combination. If we are unable to consummate our initial business combination within the above time period, we will distribute the aggregate amount then on deposit in the trust account, net of taxes payable, and less up to $50,000 of interest to pay liquidation expenses, pro rata to our public shareholders by way of the redemption of their shares and to cease all operations except for the purposes of winding up of our affairs, as further described herein. In such event, the warrants and rights will expire and be worthless. Our sponsor, Wuren Fubao Inc. and certain of their affiliates (collectively, our initial shareholders ) have agreed to purchase an aggregate of 342,500 units (or 376,625 units if the over-allotment option is exercised in full) (the private units ) at a price of $10.00 per unit in a private placement for an aggregate purchase price of $3,425,000 (or $3,766,250 if the over-allotment option is exercised in full). Each private unit will be identical to the units sold in this offering, except as described in this prospectus. The private units will be sold in a private placement that will close simultaneously with the closing of this offering, including the over-allotment option, as applicable. Although our sponsor and certain members of our board of directors and management have significant business ties to or are based in the People s Republic of China, we have determined that because of uncertainties in the regulatory climate in these jurisdictions, and the potential for future governmental actions which might unfavorably impede future operations, we will not consider or undertake a business combination with an entity or business based in, or with its principal or a majority of its business operations (either directly or through any subsidiaries) in, the People s Republic of China (including Hong Kong and Macau), and, for the avoidance of doubt, we will not enter into an agreement for, or consummate our initial business combination with, such an entity or business, or consummate our initial business combination in circumstances where we are the counterparty to a VIE or other arrangement with a China-based entity. Since many of our officers and directors have business experience in China or reside in China, not being able to target a business in China may make it more difficult to find an attractive target business outside of China, and it may make us a less attractive partner to non-Hong Kong and non-People s Republic of China targets. Because our offices are in the United States, we will not acquire a business in China, we currently do not operate in China, and a majority of our officers and directors are outside of China, we are not subject to Chinese regulations, such as those put out by the China Securities Regulatory Commission or Cyberspace Administration of China. However, the relationships of our officers and directors to China could influence the types of targets that they select to acquire due to changes in laws or regulations in China, which could result in significantly reduced securities trading prices of a post-business combination company. Although our offices are located in the United States, a majority of our directors and officers have significant ties to China (including Hong Kong and Macau). As a result, we may be subject to certain risks relating to regulatory oversight by the PRC government. In particular, changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be adopted quickly with little advance notice. The Chinese government may also intervene or influence our search for a target business or the completion of an initial business combination at any time because certain of our directors and officers have significant ties to China. This could significantly and negatively impact our search for a target business and/or the value of the securities we are registering for sale. See Risk Factor Given the Chinese government s potential oversight and discretion over the conduct of our directors and officers search for a target company, the Chinese government may intervene or influence our operations at any time, which could result in a material change in our search for a target business and/or the value of the securities we are registering. Changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be adopted quickly with little advance notice and could have a significant impact upon our ability to operate. Pursuant to the Holding Foreign Companies Accountable Act ( HFCAA ), the Public Company Accounting Oversight Board (the PCAOB ) issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (1) mainland China of the People s Republic of China because of a position taken by one or more authorities in mainland China; and (2) Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB s report identified the specific registered public accounting firms which are subject to these determinations. Our registered public accounting firm, MaloneBailey, is headquartered in the United States, is an independent registered public accounting firm registered with the PCAOB and is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess MaloneBailey s compliance with applicable professional standards and was not identified in this report as a firm subject to the PCAOB s determination. The PCAOB currently has access to inspect the working papers of our auditor. Notwithstanding the foregoing, in the event that we complete a business combination with a company, the auditor of which the PCAOB is not able to fully conduct inspections on, it could cause us to fail to be in compliance with U.S. securities laws and regulations, we could cease to be listed on a U.S. securities exchange, and U.S. trading of our shares could be prohibited under the HFCAA and Accelerating Holding Foreign Companies Accountable Act. In addition, Accelerating Holding Foreign Companies Accountable Act, if enacted, would decrease the number of non-inspection years from three years to two years, and thus, would reduce the time before our securities may be prohibited from trading or delisted. See Risk Factor U.S. laws and regulations, including the Holding Foreign Companies Accountable Act and Accelerating Holding Foreign Companies Accountable Act, may restrict or eliminate our ability to complete a business combination with certain companies and Risk Factor If we effect our initial business combination with a company located outside of the United States, trading in our securities could be negatively impacted. There is presently no public market for our units, ordinary shares, warrants or rights. We have applied to have our units listed on the Nasdaq Global Market, or Nasdaq, under the symbol EMCGU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the ordinary shares, warrants and rights comprising the units to begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless EF Hutton, division of Benchmark Investments, LLC informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions as described further herein. Once the securities comprising the units begin separate trading as described in this prospectus, we expect the ordinary shares, warrants and rights will be traded on Nasdaq under the symbols EMCG, EMCGW, and EMCGR respectively; provided that no fractional warrants will be issued and only whole warrants will trade. We cannot assure you that our securities will be approved for listing and, if approved, will continue to be listed on Nasdaq after this offering. Table of Contents States, we will not acquire a business in China, we currently do not operate in China, and a majority of our officers and directors are outside of China, we are not subject to Chinese regulations, such as those put out by the China Securities Regulatory Commission or Cyberspace Administration of China. However, the relationships of our officers and directors to China could influence the types of targets that they select to acquire due to changes in laws or regulations in China, which could result in significantly reduced securities trading prices of a post-business combination company. Because we are based in the United States and our auditor is based in the United States, we are not subject to the Holding Foreign Companies Accountable Act or related regulations and our auditor is not subject to determinations announced by the PCAOB on December 16, 2021. Competitive Advantage We have an experienced and highly professional management team, almost all of whom have entrepreneurial experience or experience working for public companies, and we believe that this valuable experience can help us to better identify outstanding companies that are considering becoming public companies. Our Chief Executive Officer Yoann Delwarde is the co-founder and CEO of Infinity Growth, a company dedicated to helping clients increase their sales, and has helped nearly 25 companies from dozens of industries in seven countries increase their sales globally. Mr. Delwarde has helped companies ranging from startups to Fortune 500 companies, which means Yoann has a wealth of contacts, so we believe Yoann s unique experience and contacts will help us identify great target companies. Our Chief Financial Officer, Zheng Yuan, has extensive financial management experience, having worked for several major Chinese banks. From October 2010 to March 2016, she was the Vice President of the International Banking Department of Bank of Beijing Corporation, responsible for international settlements, cooperation with international counterparts, and anti-money laundering operations. We believe that Ms. Zheng Yuan s extensive and long-term multinational financial management experience will help us to better identify the financial risks of potential investment targets and to find outstanding companies to acquire. In addition to rich experience in entrepreneurship and management, our management team also has an international background. All of our team members have rich experience in the management of large multinational enterprises and are familiar with the international markets. Given this broad experience, we believe that our management team will be able to source international target opportunities to help us find the best possible target for our investors. Their collective experience and expertise and ability to source a potential target is not limited by geographic region and therefore management and our Board members will be considering a business combination target which could have operations anywhere in the world, excluding China. Mr. Delwarde is from France and has many years of experience working in France and China, as well as entrepreneurial experience in China. Our independent director Gregory de Richemont is also from France and has more than 10 years of experience in financial auditing and operational management. Ms. Zheng Yuan, and our independent director, Mr. Hang Zhou, are from China and are living in the United States, and Ms. Zheng Yuan has extensive experience in multinational financial management. Mr. Hang Zhou has over 20 years of experience in developing new businesses and products in domestic and international markets. Our other independent director, Gary Xiao, has lived and worked in the United States and is an experienced independent director, audit committee chair and CFO with experience in IT and human resources management for both public and private companies. Investment Direction and Strategy Although there is no restriction or limitation on what industry or geographic region our target operates in, it is our intention to pursue prospective targets that are in the technology, internet, and consumer sectors, and we will look for companies with established brands, stable cash flow, and readiness to access capital markets. In addition, we want to find companies that are truly technology driven and have strong industry competencies. Table of Contents While we will give priority to companies in technology, internet, and consumer sectors, we will have no specific industry restriction, and we plan on exploring opportunities in enterprise services, artificial intelligence, culture and media, biotechnology, new consumer brands, blockchain and other areas that show the interest of investors. We plan to focus on the management team of potential target companies because we believe that only a mature and adaptable management team is the most reliable competitive edge in dealing with complex competitive environments, and because all good products and services are built by a good team. Investment criteria Below is a list of criteria we will consider when evaluating target companies We expect to focus on the management team of the potential target company, which we look to have strong entrepreneurial and management experience, excellent values, adaptability, and the ability to deal with a variety of complex situations, as well as a variety of potential challenges. We wanted to find a technology-driven company in an industry that has high barriers to entry and that would further be able to consolidate its strengths through a transaction with us. We expect these companies to have mature products and services that are already well accepted by the market and have positive cash flow or are close to achieving positive cash flow, rather than being in the early loss-making stages. We will look for a target company that has built a brand that customers trust and has significant influence. We will also look at the ESG (environmental, social, governance) efforts made by the company. We believe that a truly outstanding company should have a strong sense of social responsibility, in addition to an excellent management team and providing excellent products and services. Initial Business Combination We will have until 12 months (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) from the closing of this offering to consummate our initial business combination. If we are unable to consummate our initial business combination within the time period described above, we will, as promptly as reasonably possible but not more than five business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the warrants and rights will be worthless. Nasdaq rules provide that our initial business combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions and taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions with respect to the satisfaction of such criteria. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all Table of Contents of the target businesses. If our securities are not listed on Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Nasdaq at the time of our initial business combination. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act . Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity securities of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions that our initial business combination is fair to our company (or shareholders) from a financial point of view. Members of our management team and our independent directors and their affiliates will directly or indirectly own ordinary shares and private units following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity, including other blank check companies similar to our company, pursuant to which such officer or director may be required to present a business combination opportunity to such entity. Specifically, our executive officers are affiliated with other entities that make, or are looking to make, investments in companies. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity. We do not believe, however, that the fiduciary duties or contractual obligations of our executive officers will materially affect our ability to complete our business combination. For additional information regarding our executive officers and directors business affiliations and potential conflicts of interest, see Management Directors and Executive Officers and Management Conflicts of Interest. Our amended and restated memorandum and articles of association provides that, subject to fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. Table of Contents We will pay ARC Group Limited, our sponsor s financial advisor, $10,000 per month for up to 18 months for utilities and secretarial and administrative support. Private Placements Prior to this offering, we issued an aggregate of 1,437,500 ordinary shares to certain of our initial shareholders. We subsequently declared a share dividend of 0.50 shares for each outstanding share, resulting in 2,156,250 founder shares being outstanding. On July 1, 2022, the sponsor surrendered an aggregate of 287,500 founder shares for no consideration, resulting in 1,868,750 shares being outstanding. The aggregate purchase price for the founder shares was $25,000, or approximately $0.013 per share. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell their founder shares until six months after the date of the consummation of our initial business combination or earlier if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property. Our initial shareholders have agreed to purchase an aggregate of 342,500 units (or 376,625 units if the over-allotment option is exercised in full) at a price of $10.00 per unit for an aggregate purchase price of $3,425,000 (or $3,766,250 if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell any of the private units and underlying ordinary shares until after the completion of our initial business combination. Permission Required from the Chinese Authorities for this Offering and a Business Combination Although our offices are located in United States, certain of our directors and officers have significant ties to the PRC. As a result, we may be subject to certain risks relating to regulatory oversight by the PRC government. In particular, changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be adopted quickly with little advance notice. The Chinese government may also intervene or influence our search for a target business or the completion of an initial business combination at any time because certain of our directors and officers have significant ties to China. This could significantly and negatively impact our search for a target business and/or the value of the securities we are registering for sale. Since we are a Cayman Islands company with offices in the United States and have no operations in China, we are not required to obtain permission from the China Securities Regulatory Commission (CSRC), Cyberspace Administration of China (CAC) or any other governmental agency in China for our offering. Moreover, our officers and directors are not covered by any Chinese permissions requirements because our business is not conducted in China. Accordingly, as of the date of this prospectus, we have not applied or received any permission or approvals for this offering. However, a majority of our directors and officers have significant ties with China (including Hong Kong and Macau), and two are residents of mainland China (our other officers and directors are residents of the United States; none of our directors and officers live in Hong Kong or are Hong Kong residents). Therefore, if our officers and directors inadvertently concluded that permissions or approvals were not required, or if applicable laws, regulations, or interpretations change and require us and/or our directors and officers to obtain such permissions or approvals in the future, these regulatory agencies (a) may impose fines and penalties on our officers and directors and (b) may also take actions requiring our directors and officers, or making it advisable for directors and officers, to terminate this offering before settlement and delivery of our units or delay our potential business combination and therefore, we may have to liquidate the funds held in the trust account (in which case our warrants and rights may be worthless). Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on the trading price of our securities. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Table of Contents Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor internal controls attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company for up to five years. However, if our non-convertible debt issued within a three year period or revenues exceeds $1.07 billion, or the market value of our shares that are held by non-affiliates exceeds $700 million on the last day of the second fiscal quarter of any given fiscal year, we would cease to be an emerging growth company as of the following fiscal year. Our executive offices are located at 5186 Carroll Canyon Rd, San Diego, CA 92121, and our telephone number is (858) 688-4965. Table of Contents
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+This summary highlights selected information from this prospectus. It may not contain all of the information that is important to you. You should carefully read the entire prospectus and the other documents referred to in this prospectus before making an investment in our Ordinary Shares. You should carefully consider, among other things, our consolidated financial statements and the related notes and the sections titled Risk Factors, Business, and Operating and Financial Review and Prospects included elsewhere in this prospectus. For additional information, see Where You Can Find More Information in this prospectus Overview We are an innovation company with a mission to accelerate the shift to sustainable urban life by eliminating the barriers to electric fuel adoption to bring smart and swappable electric power within reach of every urban rider in the world. Nowadays, we are enabling end customers on our network to refuel their ePTWs in seconds at our over 2,200 battery swapping locations in Taiwan. In Taiwan, our network has delivered over 277 million battery swaps as of March 31, 2022 and manages over 350,000 swaps a day as of March 31, 2022. Our systems have been refined and proven with over 5.0 billion kilometers ridden by over 467,000 subscribers as of March 31, 2022. Our battery swapping technology compromises an interoperable platform that seamlessly integrates a comprehensive ecosystem of hardware, software, and services, which consists of Gogoro Smart Batteries, GoStations, Gogoro Network Software & Battery Management Systems, Smartscooter and related components and kits. When we began the development of our first-of-their-kind Smart Batteries and Smartscooters in Taiwan, there were no suitable manufacturing technologies or supplier solutions available. So we built our first Smart Factory, invented our own vertically integrated systems, and helped accelerate the technology shift within our supply chain. We have invested in our proprietary production methods and developed best practices combining advancements from premium automotive, consumer electronics, material science, and software. The innovation we have developed in the process has provided us a strong competitive advantage by allowing us to deliver technically advanced ePTWs while keeping our costs low. Gogoro Network battery swapping service for ongoing access to battery swapping at a set monthly or per-swap fee based on the energy consumed. Our business model has demonstrated ~100% attach rates for Gogoro Network subscription revenue for every annual cohort of ePTWs sold since inception in our home market of Taiwan. We believe the stickiness of Swap & Go subscription revenue accumulated over the life of every battery in the system represents compelling differentiation of our business model. During the past decade in Taiwan, we have built our owned battery swapping network to establish the Gogoro battery swapping ecosystem and catalyze the marketplace. In just over six years, the ePTWs have grown to 10% of all PTWs since we launched our first ePTW in 2015, where virtually 100% of all PTWs in Taiwan were ICE PTWs at that time. As of December 31, 2021, approximately 97% of electric two-wheelers sales have been delivered from Gogoro and our PBGN OEM partners. As we continue to expand and add additional OEM partners beyond Taiwan, we ll rely significantly on our strong and strategic OEM partnership with their global footprint, manufacturing agility, supply chain, and logistics capabilities, which will allow us to support our regional partners with greater speed and cost efficiency while further extending our brand s reach. We believe that our proven battery swapping platform, enabling technologies and strong OEM partnerships will drive rapid and sustained growth opportunities into global markets in the future. Table of Contents EXPLANATORY NOTE Pursuant to the transactions contemplated by that certain Agreement and Plan of Merger ( Merger Agreement ), dated as of September 16, 2021, by and among Gogoro Inc. ( Gogoro or the Company ), Poema Global Holdings Corp. ( Poema Global ), Starship Merger Sub I Limited, a wholly-owned subsidiary of Gogoro ( Merger Sub ), and Starship Merger Sub II Limited, a wholly-owned subsidiary of Gogoro ( Merger Sub II ). Pursuant to the Merger Agreement, (a) Merger Sub merged with and into Poema Global (the First Merger ), with Poema Global surviving the First Merger as a wholly-owned subsidiary of Gogoro (such company, as the surviving entity of the First Merger, the Surviving Entity ), and (b) immediately following the First Merger, the Surviving Entity merged with and into Merger Sub II (the Second Merger, and together with the First Merger, the Mergers ), with Merger Sub II surviving the Second Merger as a wholly-owned subsidiary of Gogoro (collectively, the Business Combination ). As a result of the Business Combination, and upon consummation of the Business Combination and the other transactions contemplated by the Merger Agreement, Merger Sub II became a wholly-owned subsidiary of Gogoro, with the shareholders of Poema Global becoming shareholders of Gogoro. The Business Combination closed on April 4, 2022 (the Closing Date ). Subject to the terms and conditions of the Merger Agreement, immediately prior to the closing of the Business Combination (the Closing ) and prior to the consummation of any of the transactions contemplated by the Subscription Agreements (as defined below), Gogoro effected a share subdivision of each of its outstanding ordinary shares, par value $0.0001 per share ( Ordinary Shares ) into such number of Ordinary Shares as calculated in accordance with the terms of the Merger Agreement to cause the value of the Ordinary Shares to equal $10.00 per share after giving effect to such share subdivision. In connection with the Closing, (i) each outstanding unit of Poema Global was separated into one Poema Global Class A ordinary share and one half of one warrant to purchase Poema Global Class A ordinary shares, (ii) each holder of Poema Global Class A ordinary shares and Poema Global Class B ordinary shares received Ordinary Shares on a one-for-one basis, and (iii) each outstanding warrant to purchase Poema Class A ordinary shares were exchanged for a warrant to purchase Ordinary Shares. No fractional warrants were issued in connection with the Closing. In connection with the Business Combination, a number of investors (the PIPE Investors ) purchased from the Company an aggregate of 29,482,000 newly-issued shares of Ordinary Shares (the PIPE Investment ), for a purchase price of $10.00 per share and an aggregate purchase price of $294,820,000 (the PIPE Shares ), each pursuant to a separate subscription agreement (each, a Subscription Agreement ), entered into on September 16, 2021, January 18, 2022 and March 21, 2022. Pursuant to the Subscription Agreements, the Company gave certain registration rights to the PIPE Investors with respect to their PIPE Shares. The sale of the PIPE Shares was consummated concurrently with the Closing. In addition, on April 4, 2022, the Company entered into Registration Rights Agreements with directors, officers and certain shareholders of the Company prior to the Closing Date ( Legacy Gogoro ), providing for certain registration rights to those parties. Table of Contents ABOUT THIS PROSPECTUS This prospectus is part of a registration statement on Form F-1 that we filed with the Securities and Exchange Commission (the SEC ). The Selling Securityholders may, from time to time, sell the securities offered by them described in this prospectus. We are not offering any Ordinary Shares for sale under this prospectus and will not receive any proceeds from the sale of Registered Shares by such Selling Securityholders under this prospectus. Neither we nor the Selling Securityholders have authorized anyone to provide you with different or additional information, other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we may have referred you, and neither we nor they take any responsibility for, or provide any assurance as to the reliability of, any other information that others may give you. Neither we nor the Selling Securityholders are making an offer to sell Ordinary Shares in any jurisdiction where the offer or sale thereof is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front cover of this prospectus, regardless of the time of delivery of this prospectus or any sale of our Ordinary Shares. We may also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which we refer you in the sections of this prospectus entitled Where You Can Find More Information. For investors outside the United States: Neither we nor the Selling Securityholders have taken any action to permit the possession or distribution of this prospectus in any jurisdiction other than the United States where action for that purpose is required. Persons outside the United States who come into possession of this prospectus must inform themselves about and observe any restrictions relating to the Ordinary Shares and the distribution of this prospectus outside the United States. We are a company incorporated under the laws of the Cayman Islands, and a majority of our outstanding securities are owned by non-U.S. residents. Under the rules of the SEC, we are currently eligible for treatment as a foreign private issuer. As a foreign private issuer, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as domestic registrants whose securities are registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Unless otherwise indicated or the context otherwise requires, all references in this prospectus to the terms Gogoro, the Company, we, us and our refer to Gogoro Inc., a Cayman Islands exempted holding company, together as a group with its subsidiaries, including its Operating Subsidiaries. All references in this prospectus to Poema Global refer to Poema Global Holdings Corp. Table of Contents Since Gogoro s inception in 2011, we have been engaged in developing and marketing our ePTW, battery swapping network, subscriptions, and other offerings, raising capital, and recruiting personnel. We have incurred net operating losses and net cash outflows from operations in every year since our inception. As of December 31, 2021, we had an accumulated deficit of $116.6 million. We have funded our operations primarily with proceeds from revenues generated from the sales of electric scooters and battery-swapping services, borrowings under our loan facilities, and private placements of our preferred and ordinary shares. We are a Cayman Islands exempted holding company with operations conducted through subsidiaries. Our operations in mainland China are limited to the following: (i) Our Taiwanese subsidiary sells products in mainland China; (ii) in November 2020, Gogoro Network Pte. Ltd. which is incorporated in Singapore, entered into a Capital Increase Agreement with Yadea and DCJ, which is governed by PRC law. Among other things, the Capital Increase Agreement provides that Gogoro will sell battery packs and battery swapping stations to a joint venture (which Gogoro has not invested any funds in) and we will receive a licensing fee for use of our SaaS platform. We do not hold any equity interest in Yadea or DCJ or any other entity incorporated in the PRC; (iii) Our Taiwan subsidiaries have entered into a service agreement with the joint venture mentioned in (ii) above under which our Taiwan subsidiaries provide consulting services to the joint venture in exchange for a consulting fee; and (iv) Gogoro Network Pte. Ltd. receives a licensing fee associated with its SaaS platform from the joint venture mentioned in (ii) above. In addition, we currently have two subsidiaries in the PRC that are inactive. Although we sell its products in mainland China, we believe that it is currently not required to obtain any permission or approval from the China Securities Regulatory Commission ( CSRC ), the Cyberspace Administration of China ( CAC ) or any other PRC governmental authority to operate its business or to list its securities on a U.S. securities exchange or issue securities to foreign investors other than standard company registration with the competent State Administration for Market Regulation and other business items that require governmental approval, such as construction permit and Internet Content Provider ( ICP ) approval and Gogoro has not been denied approval for any of its subsidiaries operations from any government entities. Additionally, we are not currently aware of any requirement to obtain approvals to offer securities to foreign investors by authorities of other countries. However, there is no guarantee that this will continue to be the case in the future in relation to the listing or continued listing of our securities on a U.S. securities exchange, or even in the event such permission or approval is required and obtained, it will not be subsequently revoked or rescinded. Recent Developments Business Combination with Poema Global and Related Transactions On April 4, 2022 (the Closing Date ), we consummated the previously announced business combination (the Business Combination ) with Poema Global, pursuant to that certain Agreement and Plan of Merger, dated as of September 16, 2021 (as amended by Amendment No. 1 to Agreement and Plan of Merger dated as of March 21, 2022, the Merger Agreement ), Starship Merger Sub I Limited, an exempted company incorporated with limited liability under the laws of Cayman Islands and a wholly-owned subsidiary of Gogoro ( Merger Sub ) and Starship Merger Sub II Limited, an exempted company incorporated with limited liability under the laws of Cayman Islands and a wholly-owned subsidiary of Gogoro ( Merger Sub II ). On the Closing Date, pursuant to the Merger Agreement, (i) Merger Sub merged with and into Poema Global (the First Merger ), Table of Contents The information contained in this prospectus is not complete and may be changed. No securities may be sold pursuant to this prospectus until the registration statement filed with the Securities and Exchange Commission with respect to such securities has been declared effective. This prospectus is not an offer to sell these securities and no offers to buy these securities are being solicited in any jurisdiction where their offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JUNE 8, 2022 PRELIMINARY PROSPECTUS UP TO 199,825,500 ORDINARY SHARES OF GOGORO INC. This prospectus relates to the offer and sale by us of (i) 17,250,000 ordinary shares, par value $0.0001 per share ( Ordinary Shares ) of Gogoro Inc. (the Company) issuable upon the exercise of 17,250,000 redeemable warrants to purchase Ordinary Shares, which were originally issued in the initial public offering of Poema Global at a price of $10.00 per unit, with each unit consisting of one Class A ordinary share of Poema Global and one-half of one warrant of Poema Global and are exercisable at a price of $11.50 per share (the Public Warrants ), and (ii) 9,400,00 Ordinary Shares issuable upon the exercise of 9,400,000 private placement warrants (the Private Placement Warrants, and together with the Public Warrants, the Warrants ) held by certain affiliates of Poema Global Partners LLC (the Sponsor ), which were purchased at a price of $1.00 per warrant in a private placement to the Sponsor and are exercisable at a price of $11.50 per share. This prospectus also relates to the resale from time to time by the selling securityholders named in this prospectus or their permitted transferees (the Selling Securityholders ) of (i) 29,482,000 Ordinary Shares (the PIPE Shares ) purchased by certain investors (the PIPE Investors ) on April 4, 2022 (the Closing Date ) pursuant to separate subscription agreements dated September 16, 2021, January 18, 2022 and March 21, 2022 (the PIPE Subscription Agreement ) at a price of $10.00 per Ordinary Share, (ii) 125,668,500 Ordinary Shares beneficially owned by certain shareholders of the Company prior to the Closing Date ( Legacy Gogoro, and such Ordinary Shares, the Legacy Gogoro Shares ) (inclusive of up to 7,075,741 Ordinary Shares issuable to such shareholders pursuant to the earnout provisions of the Merger Agreement (as described herein) which were either purchased by investors (the Private Investors ) in connection with arms-length private financings at prices of $1.00 to $3.50 per share or approximately $1.14 to approximately $4.00 per share (after accounting for the Subdivision Factor) or granted pursuant to pre-Business Combination incentive equity grants in the form of restricted stock units or options which were exercised by the recipients of such grants (the Equity Grant Recipients ) at $0.0001 per share or $0.0001 per share (after accounting for the Subdivision Factor), (iii) 8,625,000 Ordinary Shares issued to certain affiliates of the Sponsor (the Sponsor Shares, and together with the Legacy Gogoro Shares, the Affiliated Shares ) (which were purchased by the Sponsor for $25,000 or approximately $0.003 per share) and (iv) 9,400,000 Ordinary Shares issuable upon the exercise of the Private Placement Warrant. The Ordinary Shares offered by the Selling Securityholders are identified in this prospectus as the Registered Shares (the Registered Shares ). The Selling Securityholders may, or may not, elect to sell Registered Shares as and to the extent that they may individually determine. See the section entitled Plan of Distribution. We will not receive any proceeds from any sale of Registered Shares by Selling Securityholders under this prospectus. We will receive proceeds from the exercise of the Warrants if the Warrants are exercised for cash. The exercise price of the Warrants is $11.50 per share and the closing price of our Ordinary Shares on the Nasdaq on June 6, 2022 was $5.56 per ordinary share. The likelihood that warrant holders will exercise the Warrants and any cash proceeds that we would receive is dependent upon the market price of our Ordinary Shares. If the market price for our Ordinary Shares is less than $11.50 per share, we believe warrant holders will be unlikely to exercise their Warrants. We will pay the expenses associated with registering the sales by the Selling Securityholders, as described in more detail in the section titled Use of Proceeds appearing elsewhere in this prospectus. Prior to the extraordinary general meeting of Poema Global in connection with the Business Combination, holders of 29,506,265 Poema Global s Class A ordinary shares exercised their right to redeem their shares for cash at a redemption price of approximately $10.006 per share, for an aggregate redemption amount of $295,230,432.36, representing approximately 86% of the total Poema Global Class A Shares then outstanding. The Selling Securityholders can sell, under this prospectus, up to 173,175,500 Ordinary Shares constituting (on a post-exercise basis) approximately 63.9% of our issued and outstanding Ordinary Shares as of April 4, 2022 (assuming the exercise of all of our outstanding Warrants). Additionally, if all the Warrants are exercised, the Selling Securityholders would own an additional 26,650,000 Ordinary Shares, representing an additional 9.8% of the total outstanding Ordinary Shares. Sales of a substantial number of Ordinary Shares in the public market by the Selling Securityholders and/or by our other existing securityholders, or the perception that those sales might occur, could result in a significant decline in the public trading price of our Ordinary Shares and could impair our ability to raise capital through the sale of additional equity securities. Despite such a decline in the public trading price, certain Selling Securityholders may still experience a positive rate of return on the securities they purchased due to the lower price that they purchased their Ordinary Shares compared to other public investors and be incentivized to sell its securities when others are not. Based on the closing price of our Ordinary Shares on June 6, 2022, (a) the Sponsor may experience potential profit of up to $5.56 per share; (b) the Private Investors may experience potential profit (loss) of between $1.56 to $4.42 per share; and (c) the Equity Grant Recipients may experience a potential profit of $5.56 per share. The PIPE investors may experience potential profit if the price of the Company s Ordinary Shares exceeds $10.00 per Ordinary Share and the holders of Warrants may experience potential profit if the price of the Company s Ordinary Shares exceeds $12.50 per Ordinary Share. Of the 173,175,500 Ordinary Shares that may be offered or sold by the Selling Securityholders identified in this prospectus, certain of our Selling Securityholders are subject to lock-up restrictions with respect to 134,717,116 of those shares, pursuant to our agreements further described in item 7B. of our Annual Report on Form 20-F for the fiscal year ended December 31, 2021, which Item 7B. is herein incorporated by reference. Our Ordinary Shares and Public Warrants are currently traded on the Nasdaq Global Select Market ( Nasdaq ) under the symbols GGR and GGROW, respectively. Our Ordinary Shares and Public Warrants began trading on the Nasdaq on April 5, 2022. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, and are therefore eligible to take advantage of certain reduced reporting requirements otherwise applicable to other public companies. We are also a foreign private issuer, as defined in the Exchange Act and are exempt from certain rules under the Exchange Act that impose certain disclosure obligations and procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, our officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions under Section 16 of the Exchange Act. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Investing in our Ordinary Shares involves a high degree of risk. Before buying any Ordinary Shares you should carefully read the discussion of material risks of investing in such securities in Risk Factors beginning on page 11 of this prospectus. The date of this prospectus is , 2022. Table of Contents MARKET, INDUSTRY AND OTHER DATA Unless otherwise indicated, information contained in this prospectus concerning our industry and the regions in which we operate, including our general expectations and market position, market opportunity, market share and other management estimates, is based on information obtained from various independent publicly available sources and reports provided to us, and other industry publications, surveys and forecasts. We have not independently verified the accuracy or completeness of any third-party information. Similarly, internal surveys, industry forecasts and market research, which we believe to be reliable based upon management s knowledge of the industry, have not been independently verified. While we believe that the market data, industry forecasts and similar information included in this prospectus are generally reliable, such information is inherently imprecise. In addition, assumptions and estimates of our future performance and growth objectives and the future performance of our industry and the markets in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those discussed under the headings Risk Factors, Cautionary Statement Regarding Forward-Looking Statements and Operating and Financial Review and Prospects in this prospectus. TRADEMARKS, TRADE NAMES AND SERVICE MARKS This document contains references to trademarks, trade names and service marks belonging to other entities. Solely for convenience, trademarks, trade names and service marks referred to in this prospectus may appear without the or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Table of Contents with Poema Global surviving the First Merger as a wholly-owned subsidiary of Gogoro, and (ii) Poema Global merged with and into Merger Sub II (the Second Merger ), with Merger Sub II surviving the Second Merger as a wholly-owned subsidiary of Gogoro. Additionally, on the Closing Date, certain investors ( PIPE Investors ) completed the subscription of 29,482,000 Ordinary Shares at $10.00 per share for an aggregate subscription price of $294,820,000, pursuant to a series of subscription agreements (the Subscription Agreements ) previously entered into among the PIPE Investors, Poema Global and Gogoro. Prior to the Closing Date, the interim amended and restated memorandum and articles of association of Gogoro was adopted and became effective. On the Closing Date, immediately prior to the effective time of the First Merger (the First Effective Time ) and prior to the consummation of any of the transactions contemplated by the Subscription Agreements, (i) Gogoro repurchased each series C preferred share of Gogoro ( Gogoro Series C Preferred Shares ), that was issued and outstanding immediately prior to the First Effective Time, for cash consideration in an amount equal to the initial subscription price for such Gogoro Series C Preferred Shares. Immediately upon receipt of such cash consideration, each holder of a Gogoro Series C Preferred Share applied such amount to the subscription for one Ordinary Share; (ii) the amended and restated memorandum and articles of association of Gogoro was adopted and became effective; and (iii) each Ordinary Share that was issued and outstanding immediately prior to the First Effective Time was subdivided into 0.8752888353 Ordinary Shares, such that each Ordinary Share shall have a value of $10.00 per share after giving effect to such share subdivision (the Share Subdivision ). Actions set forth in paragraphs (i) through (iii) above are collectively referred to as the Recapitalization. Immediately following the Share Subdivision but prior to the consummation of any of the transactions contemplated by the Subscription Agreements or any transactions described in the following two paragraphs, there were 201,125,149 Ordinary Shares issued and outstanding. In connection with the closing of the Business Combination, each Class B ordinary share of Poema Global, par value $0.0001 per share ( Poema Global Class B Shares ) was automatically converted into one Class A ordinary share of Poema Global, par value $0.0001 per share ( Poema Global Class A Shares , such automatic conversion, the Poema Global Class B Conversion ). Each issued and outstanding unit ( Unit ), consisting of one Poema Global Class A Share and one-half of one warrant of Poema Global sold to the public (the Public Warrant ), was automatically separated the holder thereof was deemed to hold one Poema Global Class A Share and one-half of one Public Warrant (the Unit Separation ). No fractional Public Warrants was issued in connection with such separation such that if a holder of such Units would be entitled to receive a fractional Public Warrant upon such separation, the number of Public Warrants to be issued to such holder upon such separation was rounded down to the nearest whole number of Public Warrants and no cash was paid in lieu of such fractional Public Warrants. After giving effect to the Poema Global Class B Conversion and the Unit Separation, each issued and outstanding Poema Global Class A Share (including in connection with the Poema Global Class B Conversion and the Unit Separation) was no longer outstanding and was automatically converted into the right of the holder thereof to receive one Ordinary Share (after giving effect to the Recapitalization). Each Public Warrant (including in connection with the Unit Separation) and each issued and outstanding warrant of Poema Global sold to Poema Global Partners LLC, a Cayman Islands limited liability company (the Poema Global Sponsor ), in a private placement in connection with Poema Global s initial public offering (the Private Placement Warrants ) was automatically and irrevocably be assumed by Gogoro and converted into a Warrant. On the Closing Date, Gogoro issued (i) 13,618,735 Ordinary Shares to holders of Class A ordinary shares of Poema Global, including 8,625,000 Ordinary Shares issued to holders of Class B ordinary shares of Poema Global, including the Poema Global Sponsor, 6,393,750 of such shares shall become unvested shares and subject to surrender and forfeiture at Closing (the Sponsor Earn-In Shares ), until milestones based on the achievement of certain price targets of Ordinary Shares following the Closing Date are met; (iii) 26,650,000 Warrants to holders of Public Warrants and Private Placement Warrants; (iv) 201,125,149 Ordinary Shares to existing shareholders of Gogoro; and (v) 29,482,000 Ordinary Shares to the PIPE Investors. Table of Contents SELECTED DEFINITIONS Board means the board of directors of Gogoro. Cayman Companies Act means the Companies Act (As Revised) of the Cayman Islands. Earnout Shares means, pursuant to the Merger Agreement, up to 12,000,000 Ordinary Shares issuable by Gogoro upon the satisfaction of certain conditions. See Summary Recent Developments Business Combination with Poema Global and Related Transactions Earnout Shares for additional details. Exchange Act means the Securities Exchange Act of 1934, as amended. First Effective Time means the effective time of the First Merger. First Merger means the merger of Merger Sub with and into Poema Global, following which the separate corporate existence of Merger Sub shall cease and Poema Global shall continue as the Surviving Entity and as a wholly-owned subsidiary of Gogoro. GAAP means accounting principles generally accepted in the United States of America. Gogoro means Gogoro Inc., a Cayman Islands exempted holding company, together as a group with its subsidiaries, including its Operating Subsidiaries. GoStation means Gogoro Battery Swapping Stations. ICE means internal combustion engine. Merger Agreement means the Agreement and Plan of Merger, dated as of September 16, 2021, by and among Poema Global, Gogoro, Merger Sub and Merger Sub II. Merger Sub means Starship Merger Sub I Limited, an exempted company incorporated with limited liability under the laws of Cayman Islands and a wholly-owned subsidiary of Gogoro. Merger Sub II means Starship Merger Sub II Limited, an exempted company incorporated with limited liability under the laws of Cayman Islands and a wholly-owned subsidiary of Gogoro. OEM means original equipment manufacturer. Operating Subsidiaries means, collectively, the operating subsidiaries of Gogoro Inc., a Cayman Islands exempted holding company, which include Gogoro Taiwan Limited, Gogoro Taiwan Sales and Services Limited, Gogoro Network, Taiwan Branch, Gogoro Network Pte. Ltd., and GoShare Taiwan Limited. Ordinary Share means the ordinary share of Gogoro, par value $0.0001 per share, that are traded on Nasdaq under the ticker symbol GGR. Table of Contents Earnout Shares Pursuant to the terms of the Merger Agreement, we may issue up to 12,000,000 Ordinary Shares to persons who are Gogoro shareholders immediately prior to the First Effective Time, but after the Recapitalization. We refer to these shares as the Earnout Shares and the Gogoro shareholders who are eligible to receive such shares as the Earnout Participants ). We refer to the period from and after the Closing Date until the sixth anniversary of the Closing Date as the Earnout Period. Subject to the terms and conditions contemplated by the Merger Agreement, one-third of the Earnout Shares are issuable if over any twenty trading days within any thirty trading day period during the Earnout Period the volume-weighted average price of the Ordinary Shares is greater than or equal to $15.00, $17.50 and $20.00, respectively, each of which we refer to as an Earnout Event. Any fractional shares will be rounded down to the nearest whole number and payment for such fraction will be made in cash in lieu of any such fractional share based on a value equal to the applicable target price. Each Earnout Participant will receive Earnout Shares, if any, in accordance with its Pro Rata Portion, which is equal to a number of Ordinary Shares equal to the quotient obtained by dividing (i) the aggregate number of Ordinary Shares held by such Earnout Participant following the Recapitalization and immediately prior to the First Effective Time by (ii) the aggregate number of Ordinary Shares held by all Earnout Participants following the Recapitalization and immediately prior to the First Effective Time. Corporate Information Gogoro was incorporated as an exempted company in accordance with the laws and regulations of the Cayman Islands on April 27, 2011. The mailing address of Gogoro s principal executive office is 11F, Building C, No. 225, Section 2, Chang an E. Rd., SongShan District, Taipei City 105, Taiwan, and its telephone number is +886 3 273 0900. Implications of Being an Emerging Growth Company and a Foreign Private Issuer Emerging Growth Company We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). We are an emerging growth company until the earliest to occur of: the last day of the fiscal year in which we have more than $1.07 billion in annual revenues; the date we qualify as a large accelerated filer, with at least $700 million of equity securities held by non-affiliates; the issuance, in any three-year period, by us of more than $1.0 billion in non-convertible debt securities; and the last day of the fiscal year ending after the fifth anniversary of the closing of the Business Combination. As an emerging growth company, we may take advantage of certain exemptions from various reporting requirements that are applicable to other publicly traded entities that are not emerging growth companies. These exemptions include: (i) the option to present only two years of audited financial statements and related discussion in the section titled Operating and Financial Review and Prospects in this prospectus; (ii) not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002; (iii) not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board, or PCAOB, regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); (iv) not being required to submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay, say-on-frequency, and say-on-golden parachutes ; and (v) not being required to disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer s compensation to median employee compensation. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth Table of Contents PBGN means Powered by Gogoro Network. PCAOB means the Public Company Accounting Oversight Board. PIPE Investment means the commitment by the PIPE Investors to purchase the PIPE Shares. PIPE Investors means certain accredited investors that entered into the Subscription Agreements. PIPE Shares means an aggregate of 29,482,000 Ordinary Shares to be purchased by the PIPE Investors pursuant to the Subscription Agreements at a price per share of $10.00. Poema Global means Poema Global Holdings Corp., a blank check Cayman Islands exempted company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination. Poema Global Class A Share means a Class A ordinary share of Poema Global, par value $0.0001 per share, which were sold as part of the Units in the Poema Global IPO for $10.00 per Unit. Poema Global Class B Share means a Class B ordinary share of Poema Global, par value $0.0001 per share, which were initially issued to the Sponsor in a private placement prior to the Poema Global IPO for approximately $0.003 per share. Subsequently, these shares were transferred to affiliates of the Sponsor. Poema Global IPO means the initial public offering of Poema Global, which was consummated on January 8, 2021. Private Placement Warrants means the warrants sold to Sponsor for $1.00 per warrant in the private placement consummated concurrently with the Poema Global IPO, each entitling its holder to purchase one Ordinary Share at an exercise price of $11.50 per share, subject to adjustment. Public Warrants means the redeemable warrants, each entitling its holder to purchase one Ordinary Share at an exercise price of $11.50 per share, subject to adjustment, that are traded on the Nasdaq under the ticker symbol GGROW. The Public Warrants were originally sold in the initial public offering of Poema Global as part of the units at a price of $10.00 per unit, with each unit consisting of one Class A ordinary share of Poema Global and one-half of one warrant of Poema Global. Second Effective Time means the effective time of the Second Merger. Second Merger means the merger of Poema Global with and into Merger Sub II with Merger Sub II surviving as a wholly-owned subsidiary of Gogoro. Second Plan of Merger means the plan of merger for the Second Merger. Securities Act means the Securities Act of 1933, as amended. Table of Contents company to delay the adoption of these accounting standards until they would otherwise apply to private companies. We have elected not to opt out of, and instead to take advantage of, such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used. Foreign Private Issuer Gogoro is a foreign private issuer within the meaning of the rules under the Exchange Act and, as such, Gogoro is permitted to follow the corporate governance practices of its home country, the Cayman Islands, in lieu of the corporate governance standards of Nasdaq Stock Market LLC ( Nasdaq ) applicable to U.S. domestic companies. For example, Gogoro is not required to have a majority of the board consisting of independent directors nor have a compensation committee or a nominating and corporate governance committee consisting entirely of independent directors. While Gogoro does not currently intend to follow home country practice in lieu of the above requirements, Gogoro could decide in the future to follow home country practice and its Board of Directors could make such a decision to depart from such requirements by ordinary resolution. As a result, Gogoro s shareholders may not have the same protection afforded to shareholders of U.S. domestic companies that are subject to Nasdaq corporate governance requirements. As a foreign private issuer, Gogoro is also subject to reduced disclosure requirements and is exempt from certain provisions of the U.S. securities rules and regulations applicable to U.S. domestic issuers such as the rules regulating solicitation of proxies and certain insider reporting and short-swing profit rules. Table of Contents Sponsor means Poema Global Partners LLC. Sponsor Earn-in Shares means 6,393,750 of the Ordinary Shares held by the Sponsor immediately after the First Effective Time that shall become unvested and subject to forfeiture immediately after the First Effective Time. Share Subdivision means a share subdivision of each Ordinary Share into such number of Ordinary Shares calculated in accordance with the terms of the Merger Agreement, such that each Ordinary Share will have a value of $10.00 per share after giving effect to such share subdivision. Unless otherwise indicated, this prospectus does not reflect the Share Subdivision. Subdivision Factor means a number resulting from dividing (i) $2,011,251,500 (being the value of Gogoro as adjusted by its cash and indebtedness as of June 30, 2021) by (ii) the product of (x) the Aggregate Fully Diluted Company Shares, and (y) 10. Subscription Agreements means the subscription agreements entered into by the PIPE Investors on September 16, 2021, January 18, 2022 and March 21, 2022. Transactions means the transactions contemplated by the Merger Agreement and the Ancillary Documents. Units means the units issued in the Poema Global IPO, each consists of one Poema Global Class A Share and one-half of one warrant to purchase one Poema Global Class A Share. Warrants means the Public Warrants and the Private Placement Warrants. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2022/GRABW_grab_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/GRABW_grab_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/GROVW_grove_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/GROVW_grove_prospectus_summary.txt
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@@ -0,0 +1 @@
+This summary highlights selected information appearing elsewhere in this prospectus or the documents incorporated by reference herein. Because it is a summary, it may not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus, the registration statement of which this prospectus is a part and the documents incorporated by reference herein carefully, including the information set forth under the heading Risk Factors and our financial statements. Overview of the Company The Company is a digital-first, sustainability-oriented consumer products innovator specializing in the development and sale of household, personal care, beauty and other consumer products with an environmental focus. In the United States, the Company sells its products through two channels: a direct-to-consumer platform at www.grove.co and its mobile applications, where it sells products from Grove-owned brands and third parties, and the retail channel into which it sells products from Grove-owned brands at wholesale. The Company develops and sells natural products that are free from the harmful chemicals identified in its anti-ingredient list and it designs form factors and product packaging that reduces plastic waste and improves the environmental impact of the categories in which it operates. The Company also purchases environmental offsets that have made it the first plastic neutral retailer in the world, and it plans to become 100% plastic-free by 2025. For more information about the Company, see Information About the Company and Management s Discussion and Analysis of Financial Condition and Results of Operations . Additional Sellers beneficially own approximately 62.4% of our Class A Common Stock outstanding or issuable upon conversion of our Class B Common Stock and, subject to the lock-up in our Bylaws described below, may sell all of their Class A Common Stock in the public market at any time, so long as the registration statement of which the Additional Prospectus forms a part remains effective and the Additional Prospectus remains usable. Pursuant to our Bylaws, holders of any shares of our Common Stock received as merger consideration in the Merger (other than shares of our Common Stock issued as merger consideration in respect of Grove Collaborative, Inc. common stock pursuant to the Backstop Subscription Agreement (as defined below)), may not dispose of or hedge any such shares for a period of 150 days after the Closing Date. Sales of a substantial number of our shares in the public market or the perception that these sales might occur, could depress the market price of our securities. Committed Equity Financing On July 18, 2022, we entered into the Purchase Agreement with the Selling Holder. Pursuant to the Purchase Agreement, we have the right to sell to the Selling Holder up to $100,000,000 of shares of our Class A Common Stock, subject to certain limitations and conditions set forth in the Purchase Agreement, from time to time during the term of the Purchase Agreement. Sales of Class A Common Stock to the Selling Holder under the Purchase Agreement, and the timing of any such sales, are at our option, and we are under no obligation to sell any securities to the Selling Holder under the Purchase Agreement. In accordance with our obligations under the Purchase Agreement, we have filed the registration statement of which this prospectus forms a part with the SEC to register under the Securities Act the resale by the Selling Holder of up to 32,557,664 shares of Class A Common Stock that we may elect, in our sole discretion, to issue and sell to the Selling Holder, from time to time under the Purchase Agreement. Upon the satisfaction of the conditions to the Selling Holder s purchase obligation set forth in the Purchase Agreement, including that the registration statement of which this prospectus forms a part be declared effective by the SEC and the final form of this prospectus is filed with the SEC, we will have the right, but not the obligation, from time to time at our discretion until the first day of the month following the 36-month period after the date of the Purchase Table of Contents Exhibit No. Description 10.20 Second Amendment to Second Amended and Restated Loan and Security Agreement, dated as of May 9, 2022, between Silicon Valley Bank, a California corporation and Grove Collaborative, Inc. a Delaware public benefit corporation (incorporated by reference to Exhibit 10.16 of the Company s Form 8-K (File No. 001-40263), filed with the SEC on June 23, 2022). 10.21 Third Amendment to Second Amended and Restated Loan and Security Agreement, dated as of June 16, 2022, between Silicon Valley Bank, a California corporation and Grove Collaborative, Inc. a Delaware public benefit corporation, formerly known as Treehouse Merger Sub II, LLC, a Delaware limited liability company (incorporated by reference to Exhibit 10.17 of the Company s Form 8-K (File No. 001-40263), filed with the SEC on June 23, 2022). 10.22 Standby Equity Purchase Agreement, dated as of July 18, 2022, between Grove Collaborative, Inc. and YA II PN, Ltd. (incorporated by reference to Exhibit 10.22 of the Company s Form S-1 (File No. 333-266197), filed with the SEC on July 18, 2022) 16.1 Letter from WithumSmith+Brown, PC to the SEC, dated June 23, 2022 (incorporated by reference to Exhibit 16.1 to the Company s Form 8-K (File No. 001-40263), filed with the SEC on June 23, 2022). 21.1 List of Subsidiaries (incorporated by reference to Exhibit 21.1 of the Company s Form S-1 (File No. 333-266197), filed with the SEC on July 18, 2022). 23.1* Consent of WithumSmith+Brown, PC, independent registered public accounting firm of Virgin Group Acquisition Corp. II. 23.2* Consent of Ernst & Young LLP, independent registered public accounting firm of Grove Collaborative Holdings, Inc. 23.3* Consent of Sidley Austin LLP (included in Exhibit 5.1 hereto). 24.1 Power of Attorney (included in the signature page hereto to the initial filing of this registration statement). 101.INS Inline Instance Document 101.SCH Inline Taxonomy Extension Schema Document 101.CAL Inline Taxonomy Extension Calculation Linkbase Document 101.DEF Inline Taxonomy Extension Definition Linkbase Document 101.LAB Inline Taxonomy Extension Label Linkbase Document 101.PRE Inline Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). 107* Filing Fee Table + Indicates management contract or compensatory plan or arrangement. Schedules and exhibits to this agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the SEC upon request. The Registrant has redacted provisions or terms of this Exhibit pursuant to Regulation S-K Item 601(b)(10)(iv). The Registrant agrees to furnish an unredacted copy of the Exhibit to the SEC upon its request. * Filed herewith. Item 17. Undertakings. The undersigned registrant hereby undertakes: A. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: Table of Contents The information in this preliminary prospectus is not complete and may be changed. The Selling Holder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED AUGUST 24, 2022 Up to 32,557,664 Shares of Class A Common Stock This prospectus relates to the resale from time to time of up to 32,557,664 shares of Class A Common Stock, par value $0.0001 per share (the Class A Common Stock ), of Grove Collaborative Holdings, Inc., a Delaware corporation ( Grove Collaborative or the Company ), by YA II PN, LTD., a Cayman Islands exempt limited partnership (the Selling Holder ). The shares included in this prospectus consist of shares of Class A Common Stock that we have issued or that we may, in our discretion, elect to issue and sell to the Selling Holder, from time to time after the date of this prospectus, pursuant to a standby equity purchase agreement we entered into with the Selling Holder on July 18, 2022 (the Purchase Agreement ), in which the Selling Holder has committed to purchase from us, at our direction, up to $100,000,000 of our Class A Common Stock, subject to terms and conditions specified in the Purchase Agreement. See the section of this prospectus entitled Committed Equity Financing for a description of the Purchase Agreement and the section entitled Selling Holder for additional information regarding the Selling Holder. Our registration of the securities covered by this prospectus does not mean that the Selling Holder will offer or sell any of the shares of Class A Common Stock. The Selling Holder may offer, sell, or distribute all or a portion of its shares of Class A Common Stock publicly or through private transactions at prevailing market prices or at negotiated prices. We will not receive any proceeds from the sale of shares of Class A Common Stock by the Selling Holder pursuant to this prospectus. However, we may receive up to $100,000,000 in aggregate gross proceeds from sales of our Class A Common Stock to the Selling Holder that we may, in our discretion, elect to make, from time to time after the date of this prospectus, pursuant to the Purchase Agreement. We provide more information about how the Selling Holder may sell or otherwise dispose of the shares of our Class A Common Stock in the section entitled Plan of Distribution. We will bear all costs, expenses, and fees in connection with the registration of the shares of Class A Common Stock offered hereby. The Selling Holder will bear all commissions and discounts, if any, attributable to its sales of the shares of Class A Common Stock offered hereby. The Selling Holder is an underwriter within the meaning of Section 2(a)(11) of the U.S. Securities Act of 1933, as amended (the Securities Act ), and any profits on the sales of shares of our Class A Common Stock by the Selling Holder and any discounts, commissions, or concessions received by the Selling Holder are deemed to be underwriting discounts and commissions under the Securities Act. Our shares of Class A Common Stock are listed on The New York Stock Exchange (the NYSE ) under the symbol GROV. On August 23, 2022, the closing sale price of our Class A Common Stock was $5.20 per share. The Class A Common Stock being offered for resale in this prospectus (the Resale Securities ) represent a substantial percentage of the total outstanding shares of our Class A Common Stock as of the date of this prospectus. Assuming the issuance of all of the Resale Securities to the Selling Holder under the Purchase Agreement, the Resale Securities would represent approximately 45.8% of the then-outstanding Class A Common Stock (assuming the Class A Common Stock issuable upon the achievement of certain stock price thresholds pursuant to the Business Combination (as defined in this prospectus) are not outstanding, or 43.1% assuming they are outstanding). The sale of all of the Resale Securities, or the perception that these sales could occur, could result in a significant decline in the public trading price of our Class A Common Stock. In addition to the Selling Holder, certain other shareholders, including the PIPE Investors, the Sponsor, the Backstop Investor and Legacy Grove equityholders (each as defined below and collectively, the Additional Sellers ) may sell a substantial number of our securities pursuant to a separate resale prospectus (the Additional Prospectus ). The sale of the Resale Securities together with the sale of the securities held by the Additional Sellers, or the perception that these sales could occur, could depress the market price of our securities. We are an emerging growth company under federal securities laws and are subject to reduced public company reporting requirements. Investing in our Class A Common Stock involves a high degree of risk. See the section entitled
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diff --git a/parsed_sections/prospectus_summary/2022/GWH-WT_ess-tech_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/GWH-WT_ess-tech_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. It does not contain all the information you should consider before investing in our Common Stock. You should read this entire prospectus carefully, including the sections titled Risk Factors, Business, Management s Discussion and Analysis of Financial Condition and Results of Operations, Where You Can Find Additional Information, and our consolidated financial statements and related notes included elsewhere in this prospectus, before making an investment decision. In this prospectus, unless the context requires otherwise, all references to we, our, us, ESS, the Registrant, and the Company refer to ESS Tech, Inc. and its consolidated subsidiaries. ESS TECH, INC. ESS is a long-duration energy storage company specializing in iron flow battery technology. We design and produce long-duration batteries predominantly using earth-abundant materials that we believe can be cycled over 20,000 times without capacity fade. Because we designed our batteries to operate using an electrolyte of primarily salt, iron and water, they are non-toxic and substantially recyclable. Our batteries provide flexibility to grid operators and energy assurance for commercial and industrial customers. Our technology addresses energy delivery, duration and cycle-life in a single battery platform that compares favorably to lithium-ion batteries, the most widely deployed alternative technology. Using our iron flow battery technology, we are developing two products, each of which is able to provide reliable, safe, long-duration energy storage. As of December 31, 2021, we did not have any second-generation products fully deployed and we had not yet met revenue recognition criteria, but we began shipping our second-generation of Energy Warehouses in the third quarter of 2021 and were in the process of installing and commissioning such units. With each battery deployed, we will further our mission to accelerate the transition to a zero-carbon energy future with increased grid reliability. Our batteries are non-flammable, non-toxic, do not have explosion risk and can operate in temperatures ranging from -5 C to 50 C without requiring heating or cooling systems, so they can be located in sites where lithium-ion batteries cannot be placed due to fire, chemical or explosion risks. In addition, our batteries are environmentally sustainable, predominantly utilizing easily sourced materials and recyclable components. Our batteries and technology can be purchased with a ten-year performance guarantee which is backed by an investment-grade, ten-year warranty and project insurance policies from Munich Reinsurance Company ( Munich Re ), a leading provider of reinsurance, primary insurance and insurance-related risk solutions, which stands behind the performance of our energy storage products. To our knowledge, we are the first long-duration energy storage company to receive this type of insurance, which provides a warranty backstop for our proprietary flow battery technology, supporting our performance guarantee regardless of project size or location and de-risking the technology for our customers. We have also collaborated with Munich Re to develop separate project finance coverage. This allows us to secure project financing when installing our energy storage products, reducing the cost of capital for deployment, and which can be extended in order to provide long-term assurance of project performance to our customers, investors and lenders. Bonding and surety capital are provided through Aon and OneBeacon Insurance Group ( OneBeacon ) as well as qualification from the U.S. Export-Import Bank, which provides additional product assurance. We believe each of these elements allows us to increase our total addressable market, as customers have reduced technology risk, financing risk and importing risk. We believe that as we scale up our production, our battery technology will be priced competitively. When comparing products on a lifetime levelized cost of storage ( LCOS ) basis, which is the total cost of the investment in an electricity storage technology divided by its cumulative delivered electricity, we expect our batteries to be less expensive on a LCOS basis than lithium-ion alternatives for storage durations greater than four hours, which we believe is the operational maximum for lithium-ion technologies. Our cost advantage increases as the storage duration extends beyond four hours because of the scalable nature of our technology. Energy storage solutions of various sizes and durations must be installed throughout global electrical grids to enable decarbonization in line with global climate objectives. Our energy storage products are intended to supply long-duration power across this expanding spectrum of use cases. As described below in the section entitled Business Our Technology and Products, we believe our energy storage products will be capable of addressing customer needs across multiple use cases and markets. We are an early mover in long-duration energy storage and we believe we will enable more rapid implementation of renewable energy while also improving grid stability. The safety, flexibility and durability of our energy storage products enable customers to use them in nearly any location globally. Examples of use cases range from localized energy storage at commercial and industrial sites to grid-scale use cases, such as peaker plant replacement and grid stabilization. We are developing two products that provide reliable, safe, long-duration energy storage. Our first energy storage product, the Energy Warehouse, is a behind-the-meter solution (meaning that it is based at the energy consumer s location, or behind the service demarcation with the utility). The Energy Warehouse offers energy storage ranging from 50 kilowatts ( kW ) to 90 kW and four to 12-hour duration. A 50 kW system, when used for eight hours of storage, can power the equivalent of 20 homes with a total output of 400 kilowatt-hours ( kWh ). Energy Warehouses are deployed in shipping container units, allowing for a fully turnkey system that can be installed easily at nearly any customer s site. Potential use cases for Energy Warehouses include microgrids, peaker plant replacement on a small-scale and commercial and industrial ( C&I ) demand. For customers who require additional energy storage capacity, multiple units can be added to the same system. The first generation of our Energy Warehouse was deployed in 2015. Since then, all of our first-generation units have been returned to us except for two where the prototype trials continue. As of December 31, 2021, we did not have any second-generation products fully deployed and we had not yet met revenue recognition criteria, but we began shipping our second-generation of Energy Warehouses in the third quarter of 2021 and were in the process of installing and commissioning such units. Our second, larger scale energy storage product, the Energy Center, is a front-of-the-meter solution, meaning that it is designed for use in front of the service demarcation with the utility. Energy Center solutions are designed specifically for utilities, independent power producers ( IPPs ) and large C&I consumers. The Energy Center offers a fully customizable configuration range and is installed to meet our customers power, energy and duration needs. We anticipate energy storage capacities starting at 3 megawatts ( MW ) and six- to 12-hour duration. The Energy Center s modular design allows the product to scale to meet IPP and utility-scale applications, including large renewable-plus-storage projects and standalone energy storage projects. The modular design of the Energy Center also allows for it to be flexibly configured to meet varying power and energy capacity needs and deployment in a variety of settings.
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diff --git a/parsed_sections/prospectus_summary/2022/HSPOW_horizon_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/HSPOW_horizon_prospectus_summary.txt
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+PROSPECTUS SUMMARY
+ 
+ This summary highlights certain information appearing elsewhere in this prospectus. For a more complete understanding of this offering, you should read the entire prospectus carefully, including the risk factors and the financial statements. Unless otherwise stated in this prospectus, references to:
+ 
+ 
+ 
+ we, us or our company refers to Horizon Space Acquisition I Corp., a Cayman Islands exempted company;
+
+ 
+ 
+ 
+ amended and restated memorandum and articles of association are to our First Amended and Restated Memorandum and Articles of Association to be adopted immediately prior to or upon effectiveness of this prospectus;
+
+ 
+ 
+ 
+
+ 
+ 
+ Companies Act refers to the Companies Act (As Revised) of the Cayman Islands as the same may be amended and supplemented from time to time;
+
+ 
+ 
+ 
+
+ 
+ 
+ China and PRC refer to the People s Republic of China, including, for the purposes of this prospectus, Macau and Hong Kong.
+
+ 
+ 
+ 
+
+ 
+ 
+ equity-linked securities are to any securities of our company which are convertible into or exchangeable or exercisable for, ordinary shares of our company, including but not limited to a private placement of equity or debt;
+
+ 
+ 
+ 
+
+ 
+ 
+ insiders refers to all of our shareholders immediately prior to the date of this prospectus, including all of our officers and directors to the extent they hold such shares;
+
+ 
+ 
+ 
+ insider shares refers to the 1,725,000 ordinary shares held by our insiders prior to this offering (including up to an aggregate of 225,000 ordinary shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part);
+
+ 
+ 
+ 
+ initial shareholders refers to our insiders with respect to their holding of insider shares and Network 1 Financial Securities, Inc. with respect to the holding of representative shares, and/or their designee;;
+
+ 
+ 
+ 
+ letter agreements refer to the agreements to be executed among us, underwriters, our officers, directors and other insiders on the date that the registration statement is declared effective;
+
+ 
+ 
+ 
+
+ 
+ 
+ management or our management team are to our officers and directors;
+
+ 
+ 
+ 
+
+ 
+ 
+ ordinary shares are to our ordinary shares, par value $0.0001 per share;
+
+ 
+ 
+ 
+
+ 
+ 
+ private units refer to the units issued in a private placement simultaneously with the closing of this offering;
+
+ 
+ 
+ 
+ private rights refer to the rights underlying the private units;
+
+ 
+ 
+ 
+ private shares refer to the ordinary shares, par value $0.0001 per share, underlying the private units;
+
+ 
+ 
+ 
+ private warrants refer to the warrants underlying the private units;
+
+ 
+ 
+ 
+ representative shares refer to 200,000 ordinary shares to be issued to Network 1 Financial Securities, Inc., and/or its designees, at the closing of this offering;;
+
+ 
+ 
+ 2
+ 
+
+ Table of Contents
+ 
+ 
+ 
+ US Dollars and $ refer to the legal currency of the United States;
+
+ 
+ 
+ 
+
+ 
+ 
+ public shares refer to ordinary share which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) shareholder;
+
+ 
+ 
+ 
+
+ 
+ 
+ public shareholders means the holders of the ordinary shares which are being sold as part of the units in this public offering, or public shares, whether they are purchased in the public offering or in the aftermarket, including any of our insiders to the extent that they purchase such public shares (except that our insiders will not have conversion or tender rights with respect to any public shares they own).
+
+ 
+ 
+ 
+
+ 
+ 
+ sponsor refers to Horizon Space Acquisition I Sponsor Corp. a Cayman Islands exempted company;
+
+ 
+ 
+ 
+
+ 
+ 
+ units are to units sold in this offering, each consisting of one ordinary share, one redeemable warrant to receive one ordinary share, and one right to receive one-tenth of one ordinary share;
+
+ 
+ 
+ 
+
+ 
+ 
+ working capital units are to units issuable upon conversion of working capital loans, if any, at $10.00 per unit, upon the consummation of the business combination.
+
+ 
+ 
+ 
+
+ 
+ 
+ public warrants refer to the warrants which are being sold as part of the units in this offering; 
+
+ 
+ Except as specifically provided otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option.
+ 
+ All references in this prospectus to our insider shares being forfeited shall take effect as surrenders for no consideration of such shares as a matter of the Cayman Islands law. 
+ 
+ You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. We are not making an offer of these securities in any jurisdiction where the offer is not permitted.
+ 
+ 
+ 3
+ 
+
+ Table of Contents
+ 
+ General
+ 
+ We are a blank check company incorporated in the Cayman Islands on June 14, 2022 as an exempted company with limited liability (meaning that our public shareholders have no liability, as shareholders of our company, for the liabilities of our company over and above the amount paid for their shares). We were formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities, which we refer to as a target business. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location. Because of our significant ties to China, we may pursue opportunities in China. Due to the relevant PRC laws and regulations against foreign ownership of and investment in certain assets and industries, known as restricted industries, which including but not limited to, value-added telecommunications services (inclusive of internet content providers), we may have a limited pool of acquisition candidates we may acquire in China. We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable acquisition candidate, to conduct any research or take any measures, directly or indirectly, to locate or contact a target business.
+ 
+ Our Insiders and Management
+ 
+ One of our insiders is our sponsor, Horizon Space Acquisition I Sponsor Corp., a Cayman Islands exempted company.
+ 
+ The other insiders are officers and directors of the Company. We believe that with their experience and skillsets in sourcing, investing, and value-enhancement, we are well positioned in pursuing opportunities that will offer risk-adjusted returns.
+ 
+ Mr. Mingyu (Michael) Li, our Chief Executive Officer, Chief Financial Officer, Director and Chairman of the board of director. Since March 2022, Mr. Li has served as a director of Lakeshore Acquisition II Corp. (Nasdaq: LBBB), a special purpose acquisition company currently listing on Nasdaq. Since November 2021, Mr. Li has served as the Chief Executive Officer of Hangzhou Qianhe Mingde Enterprise Management Consulting Co., Ltd., namely Horizon Holdings, a company providing consulting services. Since March 2020, Mr. Li has served as the Chief Executive Officer of Hangzhou Qianhe Mingde Equity Investment Co., Ltd., namely Horizon Capital, a private equity firm focusing renewable and AI-driven manufacturing. In Horizon Capital, he has led a number of private equity fundraisings, managed advisory business for cross-border mergers & acquisitions ( M&A ). Since December 2019, Mr. Li has served as the Chief Executive Officer at Shenzhen Hetai Mingde Capital Management Co., Ltd., a company provide capital management services. From January 2014 to January 2019, Mr. Li served as a Senior Partner at Hejun Capital, a private equity firm specializing in providing capital operation system solutions to high-growth enterprises. During his tenure in Hejun Capital, Mr. Li participated in two M&A transactions and post-merger integration projects involving listed companies in the media sector. From January 2012 to January 2013, Mr. Li served as a Director of Investment Banking in China Minsheng Bank, one of the leading commercial banks in China, where he was responsible for investment banking and financing needs of large energy companies. Mr. Li received his MBA Degree with a major in Finance from Cheung Kong Graduate School of Business in 2012 and a Bachelor Degree in Law from Hebei University in 2007.
+ 
+ Mr. Angel Colon will serve as an independent director upon the effectiveness of this registration statement, of which this prospectus is a part. Since July 2021, Mr. Colon has also served as an Independent Director of Sentage Holdings Inc. (Nasdaq: SNTG), a holding company providing financial services in the PRC. Mr. Colon has served as the Chief Compliance Officer of Entoro Wealth LLC since July 2020, an investment advisory and asset management firm. Since June 2019, he has served as the Managing Director of Entoro Capital LLC, a financial and strategic advisory services firm. Both Entoro Wealth LLC and Entoro Capital LLC are affiliated with Entoro Securities LLC (CRD#: 35192/SEC#: 8-4663), a registered brokerage firm. Mr. Colon has served as a financial advisor and consultant of Andean Farm and Pharma Corp. since December 2018 and Bronson Resource Limited since December 2018, responsible for research-backed support of strategies concerning the mitigation of risk and financial planning. He has served as a Managing Member of Turing Funds, LLC since July 2017, a business services firm. He has also served as a Managing Member of NY Capital Management Group, LLC, an investment management firm, since January 2017. From October 2018 to February 2020, Mr. Colon served as a Managing Member of Vega Management Advisors, LLC, and Vega Management Investments, LLC, both of which are investment management firms. Mr. Colon received a Bachelor Degree of Science in International Business from St. John Fisher College in 1996. He has passed FINRA Series 6, Series 7, Series 24, Series 63 and Series 65 examinations and is a licensed broker registered with FINRA (CRD#: 2924711).
+ 
+ Mr. Mark Singh will serve as an independent director upon the effectiveness of our registration statement, of which this prospectus is a part. Since January 2021, Mr. Singh has served as a Project Manager of NY Capital Management Group, LLC, responsible for marketing and client relations. From September 2020 to December 2020, Mr. Singh served as a Project Manager of Turing Funds, LLC, responsible for administrative matters. From October 2017 to July 2020, Mr. Singh served as the Head of Performance of the U.S. office of Beyond Media Global LLC, a marketing agency company, where he was responsible for digital advertising accounts managements. Mr. Singh received a Bachelor Degree of Arts in History, minor in Government from Harvard College in 2013.
+ 
+ Mr. Rodolfo Jose Gonzalez Caceres will serve as an independent director upon the effectiveness of our registration statement, of which this prospectus is a part. Since May 2018, Mr. Gonzalez Caceres has been a self-employed independent consultant to provide consultation services for companies in power generation (solar/small hydro), power transmission and commodities trading industries. From September 2011 to April 2018, Mr. Gonzalez Caceres served as an External Relations Manager of Frontera Energy Corp. (TSE: FEC), a Canadian-based petroleum exploration and production company in the business of heavy crude oil and natural gas in South America, where he was responsible for monitoring the legislative and regulatory agenda related to the company s business and operations. Mr. Gonzalez Caceres received a Juris Doctor Degree from Pontificia Universidad Javeriana in 1992, a Master Degree in International Law from Tulane University Law School in 1996, and a Certificate in Administrative Law from Pontificia Universidad Javeriana in 2006.
+ 
+ Notwithstanding the foregoing, our officers and directors are not required to commit their full time to our affairs and will allocate their time to other businesses, and the collective experience of our officers and with blank check companies like ours is not significant. We presently expect each of our employees to devote such amount of time as they reasonably believe is necessary to our business (which could range from only a few hours a week while we are trying to locate a potential target business to a majority of their time as we move into serious negotiations with a target business for a business combination). The past successes of our executive officers and directors do not guarantee that we will successfully consummate an initial business combination. In addition, the members of the management team may not remain with us subsequent to the consummation of a business combination.
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+ 
+ 4
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+ Table of Contents
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+ As a blank check company incorporated for the purpose of effecting a business combination, we have significant ties to China. Mr. Mingyu (Michael) Li, our Chief Executive Officer and Chief Financial Officer, who is also the sole member and sole director of our sponsor, is located in China. Because of our significant ties to China, we may be a less attractive partner to a non-China-based target company and such perception may potentially limit or negatively impact our search for an initial business combination; or may therefore make it more likely for us to consummate a business combination with a company being based in or having the majority of the company s operations in China (a PRC Target Company ). See Risk Factors Because we have significant ties to China, it is uncertain whether that would make us a less attractive partner to a non-China-based target company and such perception may potentially limit or negatively impact our search for an initial business combination; or may therefore make it more likely for us to consummate a business combination with a PRC Target Company. on page 67 of this prospectus. Our sponsor will own 22.78% of our issued and outstanding shares following this offering. As a result, we may be considered a foreign person under rules promulgated by the CFIUS, and may not be able to complete an initial business combination with a U.S. target company since such initial business combination may be subject to U.S. foreign investment regulations and review by a U.S. government entity such as CFIUS), or ultimately prohibited. As a result, the pool of potential targets with which we could complete an initial business combination may be limited. See Risk Factor-We may not be able to complete an initial business combination with a U.S. target company if such initial business combination is subject to U.S. foreign investment regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States (CFIUS), or ultimately prohibited. on page 75 of this prospectus.
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+ Upon the effectiveness of this prospectus, our management will consist of one director located in China, who is also the Chief Executive Officer and Chief Financial Officer, two directors located in the United States and one director located in Republic of Columbia. Further, there is uncertainty if any officers and directors of the post-combination entity will be located outside the Unites States. As a result, it may be difficult, or in some cases not possible, for investors in the United States to enforce their legal rights, to effect service of process upon those officers and directors (prior to or after the business combination) located outside the United States, to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties on them under United States securities laws. In particular, the PRC does not have treaties providing for the reciprocal recognition and enforcement of judgments of courts with the United States and many other countries and regions, and you may have to incur substantial costs and contribute significant time to enforce civil liabilities and criminal penalties in reliance on legal remedies under PRC laws. Therefore, recognition and enforcement in the PRC of judgement of United States courts in relation to any matter not subject to a binding arbitration provision may be difficult or impossible. See Risk Factors Upon the effectiveness of this prospectus, certain of our executive officers and directors will be located outside the United States; therefore, investors may not be able to enforce federal securities laws or their other legal rights upon those officers and directors located outside the United States. starting on page 65 of this prospectus.
+ 
+ As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he has pre-existing fiduciary or contractual obligations, he may be required to present such business combination opportunity to such entity, subject to his or her fiduciary duties under the Cayman Islands law, prior to presenting such business combination opportunity to us. Most of our officers and directors currently have certain pre-existing fiduciary duties or contractual obligations.
+ 
+ Background and Competitive Strengths
+ 
+ We will seek to leverage our management team s proprietary network of relationships with corporate executives, private equity, venture and growth capital funds, investment banking firms and consultants in order to source, acquire, and support the operations of the business combination target. Mr. Mingyu (Michael) Li, our Chief Executive Officer, Chief Financial Officer and Chairman of the board of directors, has accumulated extensive resources as an executive at multiple companies. Being an active player in capital markets, Mr. Li has participated in a number of private equity fundraisings. One of our independent director nominees, Mr. Angel Colon is a licensed broker registered with the FINRA (CRD#: 2924711) and has been responsible for and participating in capital management, risk mitigation and portfolio management services for several private companies, of which he has developed relationships with. We will also utilize expertise of Mr. Mark Singh, another independent director nominee, in client relations in a management firm.
+ 
+ Further, our management team, comprising of our executive officers and directors, have experience in management and directorship in public companies and international companies. Mr. Li is currently serving as a Director of Lakeshore Acquisition II Corp. (Nasdaq: LBBB), a special purpose acquisition company. Mr. Angel Colon, one of our independent director nominee, has served as a Director of Sentage Holdings Inc. (Nasdaq: SNTG), a holding company providing financial services in the PRC. In addition, Mr. Rodolfo Jose Gonzalez Caceres previously served for more than 7 years as an External Relations Manager of Frontera Energy Corp. (TSE: FEC), a Canadian-based petroleum exploration and production company. We will leverage their relevant experience to search and valuate business combination targets, perform discipline due diligence and provide post business combination value-add capabilities.
+ 
+ We believe that this combination of extensive relationships and expertise will make us a preferred partner for and allow us to source high-quality business combination targets. However, none of our management team is obligated to remain with the company after an acquisition transaction, and we cannot provide assurance that the resignation or retention of our current management will be a term or condition in any agreement relating to business combination. Moreover, despite the competitive advantages we believe we have, we remain subject to significant competition with respect to identifying and executing a business combination.
+ 
+ 
+ 5
+ 
+
+ Table of Contents
+ 
+ Business Strategy and Acquisition Criteria
+ 
+ The main ambition of our management is to create value for our shareholders though our experience by improving the operating efficiency of a target business, while implementing revenue-driven and/or profit-engagement strategies and increase profit potential through additional acquisitions. Consistent with our strategy, we have identified the following general criteria and guidelines that we believe are essential in evaluating prospective target businesses. While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines should we consider it appropriate to do so:
+ 
+ 
+ 
+ Niche Deal Size
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+ 
+ 
+
+ 
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+ We intend to acquire emerging growth companies that either grow into a position to generate cash or are already cash-generative. We believe we have greater access to companies within this range and we expect the negotiation process to be comparably time-saving.
+
+ 
+ 
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+ Long-term Revenue Visibility with Defensible Market Position
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+ 
+ 
+
+ 
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+ In management s view, the target companies should be close to an anticipated inflection point, such as those companies requiring additional management expertise, those companies able to innovate by developing new products or services, or companies where we believe we have ability to achievement improved profitability performance through an acquisition designed to help facilitate growth.
+
+ 
+ 
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+ Benefits from Being a U.S. Public Company (Value Creation and Marketing Opportunities)
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+ 
+ 
+
+ 
+ 
+ We intend to search target companies that we believe will help offer attractive risk-adjusted equity returns for our shareholders. We intend to seek to acquire a target on terms and in a manner that leverages our experience. Amount other criteria, we expect to evaluate financial returns based on (i) the potential for organic growth in cash flows, (ii) the ability to achieve cost savings, (iii) the ability to accelerate growth, including through the opportunity for follow-on acquisitions, and (iv) the prospects for creating value through other value creation initiatives. We also plan to evaluate potential upside from future growth in the target business earnings and an improved capital structure.
+
+ 
+ These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant.
+ 
+ In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the U.S. Securities and Exchange Commission (the SEC ).
+ 
+ We will either (i) seek shareholder approval of our initial business combination at a meeting called for such purpose at which public shareholders may seek to convert their public shares, regardless of whether they vote for or against, or abstain from voting on, the proposed business combination, into their pro rata portion of the aggregate amount then on deposit in the trust account (net of taxes payable) or (ii) provide our public shareholders with the opportunity to sell their public shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. Notwithstanding the foregoing, our insiders have agreed, pursuant to written letter agreements with us, not to convert any public shares held by them into their pro rata portion of the aggregate amount then on deposit in the trust account. The decision as to whether we will seek shareholder approval of our proposed business combination or allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. If we so choose and we are legally permitted to do so, we will have the flexibility to avoid a shareholder vote and allow our shareholders to sell their shares pursuant to the tender offer rules of the Securities and Exchange Commission, or SEC. In that case, we will file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. We will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 upon such consummation and, solely if we seek shareholder approval, a majority of the issued and outstanding ordinary shares voted are voted in favor of the business combination.
+ 
+ We will have until 9 months from the consummation of this offering to consummate our initial business combination. If we anticipate that we may not be able to consummate our initial business combination within 9 months from closing of this offering, we may, but are not obligated to, extend the period of time to consummate a business combination two times by an additional three months each time (for a total of up to 15 months to complete a business combination), provided that our sponsor or designee must deposit into the trust account for each three months extension, $600,000, or $690,000 if the underwriter s over-allotment option is exercised in full ($0.10 per unit in either case), up to an aggregate of $1,200,000 or $1,380,000 if the underwriter s over-allotment option is exercised in full, on or prior to the date of the applicable deadline. Our public shareholders will not be afforded an opportunity to vote on our extension of time to consummate an initial business combination from 9 months to up to 15 months described above or redeem their shares in connection with such extensions. If we are unable to consummate our initial business combination within such time period, unless we extend such period pursuant to our amended and restated memorandum and articles of association, we will, as promptly as possible but not more than ten (10) business days thereafter, redeem 100% of our issued and outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account and not previously released to us or necessary to pay our taxes, and then seek to liquidate and dissolve. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public shareholders. In the event of our liquidation and subsequent dissolution and the public warrants will expire and will be worthless.
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+ 
+ 6
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+ Table of Contents
+ 
+ If we are unable to consummate our initial business combination within this time period, we will liquidate the trust account and distribute the proceeds held therein to our public shareholders by way of redeeming their shares and dissolve. If we are forced to liquidate, we anticipate that we would distribute to our public shareholders the amount in the trust account calculated as of the date that is two (2) days prior to the distribution date (including any accrued interest net of taxes payable). Prior to such distribution, we would be required to assess all claims that may be potentially brought against us by our creditors for amounts they are actually owed and make provision for such amounts, as creditors take priority over our public shareholders with respect to amounts that are owed to them. We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our shareholders could potentially be liable for any claims of creditors to the extent of distributions received by them as an unlawful payment in the event we enter an insolvent liquidation. In the event of our liquidation and subsequent dissolution, the public warrants will expire and will be worthless.
+ 
+ Pursuant to the NASDAQ listing rules, our initial business combination must be with a target business or businesses whose collective fair market value is at least equal to 80% of the balance in the trust account (excluding any deferred underwriting discounts and commissions and taxes payable on the income earned on the trust account) at the time of the execution of a definitive agreement for such business combination, although this may entail simultaneous acquisitions of several target businesses. The fair market value of the target business will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Our board of directors will have broad discretion in choosing the standard used to establish the fair market value of any prospective target business. The target business or businesses that we acquire may have a collective fair market value substantially in excess of 80% of the trust account balance. We will not be required to comply with the 80% fair market value requirement if we are delisted from NASDAQ.
+ 
+ We are not required to obtain an opinion from an unaffiliated third party that the target business we select has a fair market value in excess of at least 80% of the balance of the trust account unless our board of directors cannot make such determination on its own. We are also not required to obtain an opinion from an unaffiliated third party indicating that the price we are paying is fair to our shareholders from a financial point of view unless the target is affiliated with our officers, directors, insiders or their affiliates.
+ 
+ We currently anticipate structuring our initial business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination where we merge directly with the target business or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, only the portion of such target business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test.
+ 
+ 
+ 7
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+ Table of Contents
+ 
+ Emerging Growth Company Status and Other Information
+ 
+ We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (which we refer to herein as the JOBS Act). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
+ 
+ In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
+ 
+ We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that are held by non-affiliates exceeds $700 million as of as of the end of that year s second fiscal quarter, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three year period.
+ 
+ Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.
+ 
+ Private Placements
+ 
+ On June 14, 2022, we issued 10,000 ordinary shares of a par value of $0.0001 each to our sponsor. On August 30, 2022, (1) we issued 1,725,000 ordinary shares of a par value of $0.0001 each to our sponsor for a purchase price of $25,000, or approximately $0.0145 per share, and (2) our sponsor surrendered 10,000 ordinary shares of a par value of $0.0001 each. On September 12, 2022, our sponsor entered into a securities transfer agreement, pursuant to which our sponsor has agreed to transfer to our independent directors, Messrs. Angel Colon, Mark Singh, and Rodolfo Jose Gonzalez Caceres, 8,000, 5,000 and 5,000 ordinary shares, respectively, following the effectiveness of this prospectus and prior to the closing of this offering. We refer to these ordinary shares throughout this prospectus as the insider shares. The insider shares held by our insiders include an aggregate of up to 225,000 shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that our insiders will collectively own 20.0% of our issued and outstanding shares after this offering (without given effect to the sale of the private units and assuming our insiders do not purchase units in this offering). None of our insiders has indicated any intention to purchase units in this offering.
+ 
+ In addition, our sponsor, has committed to purchase from us an aggregate of 352,000 private units at $10.00 per private unit (for a total purchase price of $3,520,000). These purchases will take place on a private placement basis simultaneously with the consummation of this offering. All of the proceeds we receive from these purchases will be placed in the trust account described below. Our sponsor has also agreed that if the over-allotment option is exercised by the underwriters, it will purchase from us at a price of $10.00 per private unit an additional number of private units (up to a maximum of 33,750 private units) pro rata with the amount of the over-allotment option exercised so that at least $10.175 per share sold to the public in this offering is held in trust regardless of whether the over-allotment option is exercised in full or part. These additional private units will be purchased in a private placement that will occur simultaneously with the purchase of units resulting from the exercise of the over-allotment option. The proceeds from the private placement of the private units will be added to the proceeds of this offering and placed in an account in the United States maintained by CST, as trustee.
+ 
+ 
+ 8
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+ Table of Contents
+ 
+ Additionally, we have committed to issue Network 1, the representative of the underwriters, 200,000 ordinary shares, or the representative shares, at the closing of this offering. We refer to Network 1 throughout this prospectus as the underwriter and together with our insiders, as initial shareholders .
+ 
+ The insider shares, private shares and representative shares are identical to the ordinary shares included in the units being sold in this offering. However, our insiders have agreed, pursuant to written letter agreements with us, (A) to vote their insider shares and private shares (as well as any public shares acquired in or after this offering) in favor of any proposed business combination, (B) not to propose, or vote in favor of, an amendment to our amended and restated memorandum and articles of association that would stop our public shareholders from converting or selling their shares to us in connection with a business combination or affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete a business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) unless we provide dissenting public shareholders with the opportunity to convert their public shares into the right to receive cash from the trust account in connection with any such vote, (C) not to convert any insider shares and private shares (as well as any other shares acquired in or after this offering) into the right to receive cash from the trust account in connection with a shareholder vote to approve our proposed initial business combination (or sell any shares they hold to us in a tender offer in connection with a proposed initial business combination) or a vote to amend the provisions of our amended and restated memorandum and articles of association relating to shareholders rights or pre-business combination activity and (D) that the insider shares and private shares shall not participate in any liquidating distribution upon winding up if a business combination is not consummated.
+ 
+ Additionally, our insiders have agreed not to transfer, assign or sell any of the insider shares (except to certain permitted transferees) until (1) with respect to 50% of the insider shares, the earlier of six months after the date of the consummation of our initial business combination and the date on which the closing price of our ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after our initial business combination and (2) with respect to the remaining 50% of the insider shares, six months after the date of the consummation of our initial business combination, or earlier, in either case, if, subsequent to our initial business combination, we consummate a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to convert their ordinary shares for cash, securities or other property (except as described herein under the section of this prospectus entitled Principal Shareholders Restrictions on Transfers of Insider Shares and Private Units ). The private units (including the underlying securities) will not be transferable, assignable or saleable until after the completion of our initial business combination (except to certain permitted transferees). We refer to such transfer restrictions throughout this prospectus as the lock-up.
+ 
+ The representative shares have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following the date of the commencement of sales of this offering pursuant to FINRA Rule 5110(e)(1). Pursuant to FINRA Rule 5110(e)(1), these securities will not be the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the commencement of sales of this offering, nor may they be sold, transferred, assigned, pledged or hypothecated for a period of 180 days immediately following the date of the commencement of sales of this offering except to any underwriter and selected dealer participating in the offering and their officers, partners, registered persons or affiliates. 
+ 
+ If public units or shares are purchased by any of our directors, officers or initial shareholders, they will be entitled to funds from the trust account to the same extent as any public shareholder upon our liquidation but will not have redemption rights related thereto.
+ 
+ The proceeds from the private placement of the private units will be added to the proceeds of this offering and placed in a trust account in the United States maintained by CST, as trustee. If we do not complete our initial business combination within 9 months (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), the proceeds from the sale of the private units will be included in the liquidating distribution to the holders of our public shares.
+ 
+ 
+ 9
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+ Table of Contents
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+ Risks Related to Our Possible Business Combination with a PRC Target Company
+ 
+ Although there is no restriction or limitation on what industry or geographic region our target operates in, because of our significant ties to China, we may pursue a business combination with a PRC Target Company. If we complete a business combination with a PRC Target Company, we may be subject to risks due to uncertainty of the interpretation and the application of the PRC laws and regulations following the business combination. In particular, PRC laws and regulations restrict foreign ownership in certain industries. If the PRC Target Company is in any of those restricted industries, neither the post-combination entity nor its subsidiaries may own any equity interest in the PRC Target Company or its operating subsidiaries but rather may establish a WFOE in PRC to enter into the VIE Agreements with the PRC Target Company (to that extent, the PRC Target Company is known as a variable interest entity, or a VIE) and the VIE s shareholders. See Risk Factors If we effect our initial business combination with a PRC Target Company, we may be subject to certain risks associated with acquiring and operating business in China. on page 67 of this prospectus.
+ 
+ VIE Agreements normally include: (i) certain power of attorney agreements, a share pledge agreement and certain loan agreements; (ii) an exclusive business cooperation agreement which allows the post-combination entity to receive substantially all of the economic benefits from the VIE; and (iii) certain exclusive option agreements and certain spouse consent letters which provide the WFOE with an exclusive option to purchase all or part of the equity interests in and/or assets of the VIE when and to the extent permitted by PRC laws (such arrangements are referred as a VIE structure ). The post-combination entity, through a VIE structure, can consolidate the financial results of the VIE in its consolidated financial statements as a primary beneficiary in accordance with accounting principles generally accepted in the United States of America, or GAAP, or international financial reporting standards as issued by the International Accounting Standards Board, or IFRS, for accounting purpose. The post-combination entity or its shareholders do not directly or indirectly hold equity interests in the VIE, and therefore, a VIE structure is subject to risks due to the uncertainty of the interpretation and the application of the PRC laws and regulations, including but not limited to limitations on foreign ownership of business in a restricted industry, regulatory review of overseas listings of PRC companies through a special purpose vehicle, and the validity and enforcement of the VIE Agreements. The VIE structure is also subject to the risks of uncertainty about any future actions of the PRC government in this regard that could disallow the VIE structure, which would likely result in a material change in the post-combination entity s operations and may cause the value of our ordinary shares to depreciate significantly or become worthless.
+ 
+ Since the post-combination entity and its shareholders will not own equity interest in the VIE and the shareholders of the VIE will still own the shares of the VIE after the business combination, the VIE structure may not be as effective as equity ownership and we may incur substantial costs to enforce the terms of the VIE Agreements. The VIE shareholders may not act in the best interests of the WFOE or the post-combination entity, or may not perform their obligations under the VIE Agreements. If the VIE or the VIE shareholders breach their contractual obligations under the VIE Agreements, the post-business combination company may have difficulty in enforcing any rights it may have under the VIE Agreements with the VIE and/or its founders and owners because all of the VIE Agreements are governed by PRC laws and provide for the resolution of disputes through arbitration in the PRC, where the legal environment in the PRC is not as developed as in the United States. The post-combination entity may have to incur substantial costs and expend significant resources to enforce such VIE Agreements in reliance on legal remedies under PRC law. In connection with litigation, arbitration or other judicial or dispute resolution proceedings, assets under the name of any of record holder of equity interest in the VIE, including such equity interest of such record holder, may be put under court custody. As a consequence, we cannot be certain that the equity interest will be disposed pursuant to the VIE Agreements or that the ownership by the record holder of such equity interest will be unchallenged. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company If the government of the PRC finds that the VIE Agreements we entered into to allow us to consolidate the financial results of a target business do not comply with local governmental restrictions on foreign investment, or if these regulations or the interpretation of existing regulations change in the future, we could be subject to significant penalties or be forced to relinquish our interests in those operations or the post-combination entity could be unbale to consolidate the financial results of the VIE, which could cause the value of our securities depreciate significantly or become worthless. 
+ 
+ As at the date of this prospectus, there are very few precedents and little official guidance as to how VIE Agreements should be interpreted or enforced under PRC law. The VIE Agreements have not been widely tested in a court of law in the PRC and there remain significant uncertainties regarding the ultimate outcome of arbitration should legal action become necessary. Furthermore, VIE Agreements may not be enforceable in China if the PRC government authorities or courts take a view that such VIE Agreements contravene PRC laws and regulations or are otherwise not enforceable for public policy reasons. In addition, there is uncertainty as to whether the courts of the PRC would recognize or enforce judgments of U.S. courts against us or such persons predicated upon the civil liability provisions of the securities laws of the United States or any state. In the event that the post-combination entity is unable to enforce the VIE Agreements, the post-combination entity may not be able to consolidate the financial results of the VIE through the VIE Agreements, which will have a material adverse effect on its financial condition and results of operations. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company. 
+ 
+ 
+ 10
+ 
+
+ Table of Contents
+ 
+ Although the PRC authorities do not require permission to entering into the VIE Agreements, recently the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the Opinions on Severely Cracking Down on Illegal Securities Activities According to Law, or the Opinions, which was made available to the public on July 6, 2021, pursuant to which the PRC government will strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings of Chinese companies. The Opinions and any related implementing rules to be enacted may subject the VIE structure to compliance requirements in the future. Given the current regulatory environment in the PRC, uncertainty of different interpretations and enforcement of the rules and regulations in the PRC may be adverse to our business combination with a PRC Target Company or the post-business combination company, which requirements may take place quickly with little advance notice.
+ 
+ Regardless whether a VIE structure is required for us to complete a business combination with a PRC Target Company, the governing PRC laws and regulations are sometimes vague and uncertain and can change quickly with little advance notice, which may result in a material change in the post-combination entity s operations, cause the value of our shares following the business combination to significantly decline or be worthless, or substantially limit or completely hinder the post-combination entity s ability to offer or continue to offer securities to investors. For instance, the PRC government recently initiated a series of regulatory actions and statements to regulate business operations in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using a VIE structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. However, since these statements and regulatory actions are new, it is uncertain how soon Chinese legislative or administrative regulation making bodies will respond and what existing or new laws, regulations or detailed implementations and interpretations will be modified or promulgated, if any, and the potential impact such modified or new laws and regulations will have on our capability to acquire or merge with a PRC Target Company, as well as the post-combination entity s ability to conduct its business, accept foreign investments, or list on a U.S. stock exchange. 
+ 
+ The Chinese government may intervene or influence the operations of the PRC operating entities at any time and may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in the operations of the PRC operating entities and/or the value of our securities. In addition, any actions by the Chinese government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless. Changes in China s economic, political or social conditions, as well as possible interventions and influences of any government policies and actions; as well as uncertainties with respect to the PRC legal system could have a material adverse effect on our operation and the value of our securities. For instance, (i) as the date of prospectus, we are not required to obtain any permission from China authorities nor received any objection or restriction from Chinese authorities to list our securities in U.S. exchanges, however, we cannot guarantee that PRC authorities may initiate any change in its law, rules or regulations, or governmental policies that would require permission or scrutiny from relevant PRC authorities before our listing; or any law, regulation, rules and policies will become effective and enforceable after our listing that could substantially affect our operation and the value of our securities may depreciate quickly even become worthless. See Summary Permission Required from the PRC Authorities for this Offering and PRC Limitations on Overseas Listing and Share Issuances If We Acquire a PRC Target Company (Post-Business Combination) on page 35; and (ii) after consummation of this offering and prior to the consummation of our initial business combination, our operation involves searching and identifying suitable targets, conducting due diligence on targets, negotiating and consummating our initial business combination. Though we are not restricted or prohibited from such business activities in China, we are subject to risks and uncertainties about future actions of the PRC government or law enforcement to refrain our activities or operation in China, which would likely result in a material change in our operations, significantly limit or hinder our ability to offer or continue to offer our securities, and cause the value of our securities may depreciate significantly or become worthless. See Risk Factors The Chinese government may exercise significant oversight and discretion over the conduct of the post-combination entity s business and may intervene in or influence its operations at any time, which could result in a material change in its operations and/or the value of our securities. We are also currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if the PRC Target Company and the VIE were required to obtain approval in the future and were denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing on a U.S. exchange, which would materially affect the interest of our investors on page 78 and Risk Factors Uncertainties with respect to the PRC legal system could adversely affect us. on page 36. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company on page 67 of this prospectus.
+ 
+ 
+ 11
+ 
+
+ Table of Contents
+ 
+ Permission Required from the PRC Authorities for this Offering and a Business Combination and PRC 
+ Limitations on Overseas Listing and Share Issuances If We Acquire a PRC Target Company (Post-Business Combination)
+ 
+ Our company is a blank check company incorporated in Cayman Islands rather than in China and currently our company does not own or control any equity interest in any PRC company or operate any business in China. The CSRC, currently has not issued any definitive rule or interpretation concerning whether offerings like ours under this prospectus are subject to the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, (the M&A Rules ), and we believe that we are not required to obtain any licenses or approvals, under applicable PRC laws and regulations, for our operation or consummation of this offering and seeking a target for the initial business combination. Further, according to the Measures for Cybersecurity Review, which was promulgated on December 28, 2021 and became effective on February 15, 2022, online platform operators holding more than one million users/users individual information shall be subject to cybersecurity review before listing abroad. As we are a blank check company and are not involved in the collection of personal data of at least 1 million users or implicate cybersecurity, we do not believe that we are a network platform operator(s) , or subject to the cybersecurity review of the Cyberspace Administration of China (the CAC ). As of the date of this prospectus, we have not received any inquiry, notice, warning, sanction or any regulatory objection to this offering from any relevant PRC authorities. 
+ 
+ If we acquire a PRC Target Company, we may be required to obtain approval from Chinese authorities, including the CSRC or CAC, to list on U.S. exchanges or issue securities to foreign investors either in connection with a business combination or post business combination. If approval is required in the future and we were denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to complete a business combination or continue listing on a U.S. exchange, which would materially affect the interest of our investors. It is uncertain when and whether we will be required to obtain permission from the PRC government to continue to list on U.S. exchanges in the future, and even when such permission is obtained, whether it will be denied or rescinded. Our operations may be adversely affected in the future, directly or indirectly, by existing or future laws and regulations relating to the PRC Target Company s business or industry and oversea listing and share issuance.
+ 
+ However, applicable laws, regulations, or interpretations of PRC may change, and the relevant PRC government agencies could reach a different conclusion. There is also possibility that we may not be able to obtain or maintain such approval or that we inadvertently concluded that such approval was not required. If prior approval was required while we inadvertently concluded that such approval was not required or if applicable laws and regulations or the interpretation of such were modified to require us to obtain the approval in the future, we may face regulatory actions or other sanctions from relevant Chinese regulatory authorities. Once we complete a business combination with a PRC Target Company, these authorities may impose fines and penalties upon our operations in China, limit our operating privileges in China, delay or restrict the repatriation of the proceeds from financing offering into China, or take other actions that could have a material adverse effect upon our business, financial condition, results of operations, reputation and prospects, as well as the trading price of our securities. In addition, any changes in PRC law, regulations, or interpretations may severely affect our operations after this offering. The CSRC or other Chinese regulatory agencies may also take actions requiring us, or making it advisable for us, to terminate this offering prior to closing or be subject to other severe consequences, which would materially affect the interest of the investors. To that extent, we may not be able to conduct the process of searching for a potential target company in China. Any failure of us to fully comply with new regulatory requirements may significantly limit or completely hinder our ability to offer or continue to offer the securities, causing significant disruption to our business operations, severely damage our reputation, materially and adversely affect our financial condition and results of operations and cause the securities to significantly decline in value or become worthless. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company The approval of the China Securities Regulatory Commission is not required in connection with this offering, however, if required, we cannot predict whether we will be able to obtain such approval. and In light of recent events indicating greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, companies with more than one million users personal information in China, especially some internet and technology companies, may not be willing to list on a U.S. exchange or enter into a definitive business combination agreement with us. Further, we may also avoid conduct a business combination with a company with more than one million users personal information in China due to the limited timeline for us to complete a business combination. 
+ 
+ 
+ 12
+ 
+
+ Table of Contents
+ 
+ Transfer of Cash to and from Our Post-Combination Entity If We Acquire a PRC Target Company
+ 
+ We are a blank check company with no operations of our own and no subsidiaries except searching for a suitable target to consummate an initial business combination. As of the date of this prospectus, no transfers, dividends, or distributions have been made by us. We have not adopted or maintained any other cash management policies and procedures and need to comply with applicable law or regulations with respect to transfer of funds, dividends and distributions, if any.
+ 
+ There is no restriction in the geographic location of targets that we can pursue. We currently do not have any PRC subsidiaries or China operations, do not have any specific business combination under consideration and have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction. However, because of our significant ties to China, we may pursue a business combination with a PRC Target Company which might or might not require a VIE structure. If we complete a business combination with a PRC Target Company, we may rely on transfer of funds, dividends or other distributions on equity paid by our WFOE, which may rely on payment by a VIE and its operating PRC subsidiaries pursuant to the VIE Agreements; and we may wish to transfer cash proceeds raised from overseas financing activities, to our WFOE and/or the VIE and the VIE s operating PRC subsidiaries. Such transfer of funds, dividends or other distributions are subject to the PRC government s regulations which may limit the WFOEs ability to distribute dividends to us or our ability to transfer or distribute fund to the WFOE, or may otherwise adversely affect the post-combination entity.
+ 
+ Funds may be transferred between a WFOE and a VIE pursuant to the VIE Agreements as permitted by the applicable PRC regulations. However, if a WFOE or a VIE incurs debt on its own in the future, the instruments governing such debt may restrict such entity s ability to pay dividends, make distribution or transfer funds to the post-combination entity. In addition, the WFOE and the VIE will be required to make appropriations to certain statutory reserve funds, which are not distributable as cash dividends except in the event of a solvent liquidation of the companies. Current PRC regulations permit PRC subsidiaries to pay dividends to their parent only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. In addition, companies in China are generally required to set aside at least 10% of their after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of their registered capital. Entities in China may also be required to further set aside a portion of their after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of their boards of directors. The statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies. However, the reserve funds are not distributable as cash dividends except in the event of liquidation.
+ 
+ The PRC government also imposes controls on the conversion of Chinese currency (RMB) into foreign currencies and the remittance of currencies out of the PRC and vice versa. Investment in Chinese companies, which are governed by the Foreign Investment Law, and the dividends and distributions from a China-based operating company are subject to regulations and restrictions on dividends and payment to parties outside of China are subject to restrictions. Furthermore, if certain procedural requirements are satisfied, the payment in foreign currencies on current account items, including profit distributions and trade and service related foreign exchange transactions, can be made without prior approval from State Administration of Foreign Exchange (the SAFE ) or its local branches. However, where RMB would be converted into foreign currency and remitted out of China to pay capital expenses, such as the repayment of loans denominated in foreign currencies, approval from or registration with competent government authorities or its authorized banks is required. The PRC government may take measures at its discretion from time to time to restrict access to foreign currencies for current account or capital account transactions. If the foreign exchange control regulations prevent the VIE or the WFOE from obtaining sufficient foreign currencies to satisfy their foreign currency demands, the VIE or the WFOE may not be able to pay dividends or repay loans in foreign currencies to their offshore intermediary holding companies and ultimately to the post-combination entity. We cannot assure you that new regulations or policies will not be promulgated in the future, which may further restrict the remittance of RMB into or out of the PRC. We cannot assure you, in light of the restrictions in place, or any amendment to be made from time to time, that the WFOE will be able to satisfy their respective payment obligations that are denominated in foreign currencies, including the remittance of dividends outside of the PRC. Therefore, we may experience difficulties in completing the administrative procedures necessary to obtain and remit foreign currency for the payment of dividends from our subsidiaries or the VIE, if any. Furthermore, if the post-combination entity is unable to consolidate the financial results of the VIE through the VIE Agreements in accordance with the U.S. GAAP as primary beneficiary for accounting purposes, the post-combination may be unable to pay dividends on its shares. See Risk Factors Governmental control of currency conversion may affect the value of your investment. and Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company Exchange controls that exist in the PRC may restrict or prevent us from using the proceeds of this offering to acquire a PRC Target Company and limit our ability to utilize our cash flow effectively following our initial business combination on page 36 of this prospectus.
+ 
+ 
+ 13
+ 
+
+ Table of Contents
+ 
+ Cash dividends, if any, on our ordinary shares will be paid in U.S. dollars. If upon consummation of our business combination we are considered a PRC tax resident enterprise for tax purposes, any dividends we pay to our overseas shareholders may be regarded as China-sourced income and as a result may be subject to PRC withholding tax at a rate of up to 10.0%. If the post-combination entity has a VIE structure upon consummation of the initial business combination, certain payments from the VIE may be subject to PRC taxes, including business taxes and value added tax ( VAT ). See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company In the event we successfully consummated business combination with a PRC Target Company, we will be subject to restrictions on dividend payments following consummation of our initial business combination. on page 36 of this prospectus. 
+ 
+ Recent PCAOB Developments
+ 
+ The United States Public Company Accounting Oversight Board ( PCAOB ) is currently unable to conduct inspections on accounting firms in the PRC without the approval of the Chinese government authorities. The auditor and its audit work in the PRC may not be inspected fully by the PCAOB. Inspections of other auditors conducted by the PCAOB outside China have at times identified deficiencies in those auditors audit procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality. The lack of PCAOB inspections of audit work undertaken in China prevents the PCAOB from regularly evaluating the PRC auditor s audits and its quality control procedures. As a result, shareholders may be deprived of the benefits of PCAOB inspections if we complete a business combination with such companies.
+ 
+ Future developments in U.S. laws may restrict our ability or willingness to complete certain business combinations with companies. For instance, the enacted Holding Foreign Companies Accountable Act (the HFCAA ) would restrict our ability to consummate a business combination with a target business unless that business met certain standards of the PCAOB and would require delisting of a company from U.S. national securities exchanges if the PCAOB is unable to inspect its public accounting firm for three consecutive years. The HFCAA also requires public companies to disclose, among other things, whether they are owned or controlled by a foreign government, specifically, those based in China. 
+ 
+ We may not be able to consummate a business combination with a favored target business due to these laws. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act ( AHFCAA ), which, if signed into law, would amend the HFCAA and require the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years.
+ 
+ The documentation we may be required to submit to the SEC proving certain beneficial ownership requirements and establishing that we are not owned or controlled by a foreign government in the event that we use a foreign public accounting firm not subject to inspection by the PCAOB or where the PCAOB is unable to completely inspect or investigate our accounting practices or financial statements because of a position taken by an authority in the foreign jurisdiction could be onerous and time consuming to prepare. The HFCAA mandates the SEC to identify issuers of SEC-registered securities whose audited financial reports are prepared by an accounting firm that the PCAOB is unable to inspect due to restrictions imposed by an authority in the foreign jurisdiction where the audits are performed. If such identified issuer s auditor cannot be inspected by the PCAOB for three consecutive years, the trading of such issuer s securities on any U.S. national securities exchanges, as well as any over-the-counter trading in the U.S., will be prohibited.
+ 
+ 
+ 14
+ 
+
+ Table of Contents
+ 
+ On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCAA. An identified issuer will be required to comply with these rules if the SEC identifies it as having a non-inspection year under a process to be subsequently established by the SEC.
+ 
+ On November 5, 2021, the SEC approved the PCAOB s Rule 6100, Board Determinations Under the HFCAA. Rule 6100 provides a framework for the PCAOB to use when determining, as contemplated under the HFCAA, whether it is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction.
+ 
+ On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions.
+ 
+ On December 16, 2021, the PCAOB issued a Determination Report which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (i) mainland China, and (ii) Hong Kong. Our auditor, UHY LLP, headquartered in New York City, is an independent registered public accounting firm registered with the PCAOB and is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess UHY LLP s compliance with applicable professional standards. The PCAOB currently has access to inspect the working papers of our auditor. Our auditor is not headquartered in mainland China or Hong Kong and was not identified in this report as a firm subject to the PCAOB s determination.
+ 
+ On August 26, 2022, the CSRC, the Ministry of Finance of the PRC, and PCAOB signed a Statement of Protocol, or the Protocol, governing inspections and investigations of audit firms based in China and Hong Kong. Pursuant to the Protocol, the PCAOB has independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. However, uncertainties still exist whether this new framework will be fully complied with. According to the PCAOB, its December 2021 determinations under the HFCAA remain in effect. The PCAOB is required to reassess these determinations by the end of 2022. Under the PCAOB s rules, a reassessment of a determination under the HFCAA may result in the PCAOB reaffirming, modifying or vacating the determination. However, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered public accounting firms in mainland China and Hong Kong, the PCAOB is likely to determine by the end of 2022 that positions taken by authorities in the PRC obstructed its ability to inspect and investigate registered public accounting firms in mainland China and Hong Kong completely, then the companies audited by those registered public accounting firms would be subject to a trading prohibition on U.S. markets pursuant to the HFCAA.
+ 
+ In the event that we complete a business combination with a PRC Target Company and PCAOB is not able to fully conduct inspections of the post-combination entity s auditor s work papers in mainland China or Hong Kong, it could cause us to fail to be in compliance with U.S. securities laws and regulations, we could cease to be listed on a U.S. securities exchange, and U.S. trading of our shares could be prohibited under the HFCAA. Any of these actions, or uncertainties in the market about the possibility of such actions, could adversely affect our prospects to successfully complete a business combination with a PRC Target Company, our access to the U.S. capital markets and the price of our shares.
+ 
+ Future developments in respect of increased U.S. regulatory access to audit information are uncertain, as the legislative developments are subject to the legislative process and the regulatory developments are subject to the rule-making process and other administrative procedures.
+ 
+ Other developments in U.S. laws and regulatory environment, including but not limited to executive orders such as Executive Order (E.O.) 13959, Addressing the Threat from Securities Investments That Finance Communist Chinese Military Companies, may further restrict our ability to complete a business combination with certain China-based businesses.
+ 
+ For more detailed information, see Risk Factors Trading in our securities may be prohibited under the Holding Foreign Companies Accountable Act if the PCAOB determines that it cannot inspect or fully investigate our auditor. In that case, Nasdaq would delist our securities. The delisting of our securities, or the threat of their being delisted, may materially and adversely affect the value of your investment. Additionally, the inability of the PCAOB to conduct inspections may deprive our investors with the benefits of such inspections. starting on page 75 of this prospectus. 
+ 
+ Corporate Information
+ 
+ Our principal executive office is located at 1412 Broadway, 21st Floor, Suite 21V, New York, NY 10018 and our telephone number is (646)257-5537. 
+ 
+ 
+ 15
+ 
+
+ Table of Contents
+ 
+ The Offering
+ 
+ In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these, and the other risks set forth in the section below entitled Risk Factors beginning on page 35 of this prospectus.
+ 
+ Securities offered
+ 6,000,000 units, at $10.00 per unit, each unit consisting of one ordinary share, one redeemable warrant, and one right. Each whole redeemable warrant entitles the holder thereof to purchase one ordinary share at a price of $11.50 per share. Every ten rights entitle the holder to receive one ordinary share upon consummation of our initial business combination.
+
+ 
+ 
+
+ Listing of our securities and proposed symbols
+ We anticipate the units, and the ordinary shares, warrants, and rights, once they begin separate trading, will be listed on the NASDAQ Global Market under the symbols HSPOU, HSPO, HSPOW, and HSPOR, respectively.
+
+ 
+ 
+
+ 
+ Each of the ordinary shares, warrants, and rights may trade separately on the 52nd day after the date of this prospectus unless the underwriters determine that an earlier date is acceptable (based upon, among other things, its assessment of the relative strengths of the securities markets and small capitalization and blank check companies in general, and the trading pattern of, and demand for, our securities in particular). In no event will the underwriters allow separate trading of the ordinary shares and warrants until we file an audited balance sheet reflecting our receipt of the gross proceeds of this offering.
+
+ 
+ 
+
+ 
+ Once the ordinary shares, warrants, and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component pieces. Holders will need to have their brokers contact our transfer agent in order to separate the units into separately trading ordinary shares, warrants, and rights. Accordingly, unless you purchase ten units, you will not receive an ordinary share underlying the rights upon the consummation of the business combination.
+
+ 
+ 
+
+ 
+ We will file a Current Report on Form 8-K with the SEC, including an audited balance sheet, promptly upon the consummation of this offering, which is anticipated to take place three business days from the date the units commence trading. The audited balance sheet will reflect our receipt of the proceeds from the exercise of the over-allotment option if the over-allotment option is exercised on the date of this prospectus. If the over-allotment option is exercised after the date of this prospectus, we will file an amendment to the Form 8-K or a new Form 8-K to provide updated financial information to reflect the exercise of the over-allotment option. We will also include in the Form 8-K, or amendment thereto, or in a subsequent Form 8-K, information indicating if the underwriters has allowed separate trading of the ordinary shares, warrants, and rights prior to the 52nd day after the date of this prospectus.
+
+ 
+ 
+ 16
+ 
+
+ Table of Contents
+ 
+ Units:
+ 
+
+ 
+ 
+
+ Number outstanding before this offering
+ 0 unit
+
+ 
+ 
+
+ Number outstanding after this offering and private placement
+ 6,352,000 units(1)
+
+ 
+ (1)
+ This number includes 6,000,000 public units and 352,000 private units.
+
+ 
+ ordinary shares:
+ 
+
+ 
+ 
+
+ Number issued and outstanding before this offering and the private placement
+ 1,725,000 ordinary shares (2)
+
+ 
+ 
+
+ Number to be issued and outstanding after this offering and sale of private units
+ 8,052,000 ordinary shares (3)
+
+ 
+ (2)
+ This number includes an aggregate of up to 225,000 ordinary shares held by our insiders that are subject to forfeiture if the over-allotment option is not exercised by the underwriters in full.
+
+ 
+ (3)
+ Assumes the over-allotment option has not been exercised and an aggregate of 225,000 ordinary shares held by our insiders have been forfeited. Includes 1,500,000 insider shares, 6,000,000 ordinary shares included in the public units, 352,000 ordinary shares included in the private units, and 200,000 representative shares. If the over-allotment option is exercised in full, there will be a total of 9,210,750 ordinary shares issued and outstanding.
+
+ 
+ Redeemable Warrants:
+ 
+
+ 
+ 
+
+ Number issued and outstanding before this offering and the private placement
+ 0 warrant
+
+ 
+ 
+
+ Number to be issued and outstanding after this offering and sale of private units
+ 6,352,000 warrants(4)
+
+ 
+ 
+
+ Exercisability
+ Each whole redeemable warrant entitles the holder thereof to purchase one ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus. Pursuant to the warrant agreement, a warrant holder may exercise its warrants for a whole number of shares. 
+
+ 
+ (4)
+ Assumes the over-allotment option has not been exercised. Includes 6,000,000 warrants included in the public units and 352,000 warrants included in the private units. If the over-allotment option is exercised in full, there will be a total of 7,285,750 warrants, including 6,900,000 warrants included in the public units and 385,750 warrants included in the private units.
+
+ 
+ 
+ 17
+ 
+
+ Table of Contents
+ 
+ Exercise price
+ $11.50 per share subject to adjustments as described in this prospectus. No public warrants will be exercisable for cash unless we have an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such ordinary shares. It is our current intention to have an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such ordinary shares in effect promptly following consummation of an initial business combination. Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the public warrants is not effective within 60 business days following the consummation of our initial business combination, public warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. In such event, each holder would pay the exercise price by surrendering the warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the volume weighted average price of the ordinary shares for the 10 trading days ending on the day prior to the date of exercise. For example, if a holder held 300 warrants to purchase 300 shares and the fair market value on the date prior to exercise was $15.00, that holder would receive 65 shares without the payment of any additional cash consideration. If an exemption from registration is not available, holders will not be able to exercise their warrants on a cashless basis.
+ 
+ In addition, if (x) we issue additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share (with such issue price or effective issue price to be determined in good faith by our board of directors) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination, and (z) the volume weighted average trading price of our ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Price ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the greater of (i) the Market Price or (ii) the Newly Issued Price, and the $16.00 per share redemption trigger price described below will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price.
+
+ 
+ 
+ Exercise period
+ The warrants will become exercisable on the later of the completion of an initial business combination and one year from the effective date of this registration statement. The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of the completion of the initial business combination, or earlier upon redemption or liquidation.
+ 
+ We are not registering the ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable after the closing of our initial business combination, we will use our best efforts to file, and within 60 business days following the closing of our initial business combination to have declared effective, a registration statement covering the ordinary shares issuable upon exercise of the warrants, and to maintain a current prospectus relating to those ordinary shares until the warrants expire or are redeemed. No warrants will be exercisable for cash unless we have an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such ordinary shares. Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the warrants is not effective within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act provided that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis.
+
+ 
+ 
+ 18
+ 
+
+ Table of Contents
+ 
+ 
+ Notwithstanding the above, if our public shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
+
+ 
+ 
+
+ Redemption
+ We may redeem the outstanding warrants, in whole and not in part, at a price of $0.01 per warrant:
+
+ 
+ 
+
+ 
+ at any time while the warrants are exercisable,
+
+ 
+ 
+
+ 
+ upon a minimum of 30 days prior written notice of redemption,
+
+ 
+ 
+
+ 
+ if, and only if, the last sales price of our ordinary shares equals or exceeds $16.00 per share, as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations, and the like, for any 20 trading days within a 30 trading days period ending three business days before we send the notice of redemption, and
+
+ 
+ 
+
+ 
+ if, and only if, there is a current registration statement in effect with respect to the ordinary shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.
+
+ 
+ 
+ If the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior to the scheduled redemption date. However, the price of the ordinary shares may fall below the $16.00 trigger price as well as the $11.50 warrant exercise price per share after the redemption notice is issued and not limit our ability to complete the redemption.
+
+ 
+ 
+
+ 
+ The redemption criteria for our warrants have been established at a price which is intended to provide warrant holders a reasonable premium to the initial exercise price and provide a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the share price declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the warrants.
+
+ 
+ 
+ 19
+ 
+
+ Table of Contents
+ 
+ 
+ If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average last sale price of the ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether we will exercise our option to require all holders to exercise their warrants on a cashless basis will depend on a variety of factors including the price of our ordinary shares at the time the warrants are called for redemption, our cash needs at such time and concerns regarding dilutive share issuances.
+
+ 
+ 
+
+ 
+ The private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering.
+
+ 
+ Rights:
+ 
+
+ 
+ 
+
+ Number issued and outstanding before this offering and the private placement
+ 0 rights
+
+ 
+ 
+
+ Number to be issued and outstanding after this offering and sale of private units
+ 6,352,000 rights(5)
+
+ 
+ Terms of Rights
+ Except in cases where we are not the surviving company in a business combination, each holder of a right will automatically receive one-tenth of one ordinary share upon consummation of our initial business combination. In the event we will not be the surviving company upon completion of our initial business combination, each right will automatically be converted to receive the kind and amount of securities or properties of the surviving entity that each one-tenth of one ordinary share underlying each right is entitled to upon consummation of the business combination subject to any dissenter rights under the applicable law. We will not issue fractional shares in connection with a conversion of rights. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable provisions of the Companies Act and any other applicable Cayman Islands law. As a result, you must hold rights in multiples of ten in order to receive shares for all of your ordinary shares underlying the rights upon closing of a business combination. If we are unable to complete an initial business combination within the required time period and we redeem the public shares for the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless. The Company shall reserve such amount of its profits or share premium in order to pay up the par value of each share issuable in respect of the rights.
+
+ 
+ (5)
+ Assumes the over-allotment option has not been exercised. Includes 6,000,000 rights included in the public units and 352,000 rights included in the private units. If the over-allotment option is exercised in full, there will be a total of 7,285,750 rights, including 6,900,000 rights included in the public units and 385,750 rights included in the private units.
+
+ 
+ 
+ 20
+ 
+
+ Table of Contents
+ 
+ 
+ Insider Shares
+ On August 30, 2022, we issued 1,725,000 insider shares to our insiders for a purchase price of $25,000, or approximately $0.0145 per share. On September 12, 2022, our sponsor entered into a securities transfer agreement, pursuant to which our sponsor has agreed to transfer our independent directors, Messrs. Angel Colon, Mark Singh and Rodolfo Jose Gonzalez Caceres, 8,000, 5,000 and 5,000 ordinary shares, respectively, following the effectiveness of this prospectus and prior to the closing of this offering. The insider shares held by our insiders include an aggregate of up to 225,000 shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that our insiders will collectively own 20.0% of our issued and outstanding shares after this offering (excluding the sale of the private units and representative shares and assuming our insiders do not purchase units in this offering). None of our insiders has indicated any intention to purchase units in this offering.
+ 
+ The insider shares and private shares are identical to the ordinary shares included in the units being sold in this offering. However, our insiders have agreed, pursuant to written letter agreements with us, (A) to vote their insider shares and private shares (as well as any public shares acquired in or after this offering) in favor of any proposed business combination, (B) not to propose, or vote in favor of, an amendment to our amended and restated memorandum and articles of association that would stop our public shareholders from converting or selling their insider shares and private shares to us in connection with a business combination or affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete a business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) unless we provide dissenting public shareholders with the opportunity to convert their public shares into the right to receive cash from the trust account in connection with any such vote, (C) not to convert any insider shares and private shares (as well as any other shares acquired in or after this offering) into the right to receive cash from the trust account in connection with a shareholder vote to approve our proposed initial business combination (or sell any shares they hold to us in a tender offer in connection with a proposed initial business combination) or a vote to amend the provisions of our amended and restated memorandum and articles of association relating to shareholders rights or pre-business combination activity and (D) that the insider shares and private shares shall not participate in any liquidating distribution upon winding up if a business combination is not consummated.
+
+ 
+ Private placement at time of offering
+ Our sponsor has committed to purchase from us an aggregate of 352,000 private units at $10.00 per private unit (for a total purchase price of $3,520,000). These purchases will take place on a private placement basis simultaneously with the consummation of this offering. All of the proceeds we receive from these purchases will be placed in the trust account described below. Our sponsor has also agreed that if the over-allotment option is exercised by the underwriters, it will purchase from us at a price of $10.00 per private unit an additional number of private units (up to a maximum of 33,750 private units) pro rata with the amount of the over-allotment option exercised so that at least $10.175per share sold to the public in this offering is held in trust regardless of whether the over-allotment option is exercised in full or part. These additional private units will be purchased in a private placement that will occur simultaneously with the purchase of units resulting from the exercise of the over-allotment option. The proceeds from the private placement of the private units will be added to the proceeds of this offering and placed in an account in the United States maintained by CST, as trustee.
+ 
+ Each private unit shall consist of one ordinary share, one whole warrant, and one right. Each whole private warrant is exercisable to purchase one ordinary share at a price of $11.50 per whole share, subject to adjustment as provided herein. Private warrants may be exercised only for a whole number of warrants.
+ 
+ The private units are identical to the units sold in this offering except as described in this prospectus.
+
+ 
+ 
+ 21
+ 
+
+ Table of Contents
+ 
+ Transfer restrictions on insider shares and private units
+ Our insiders have agreed not to transfer, assign or sell any of the insider shares (except to certain permitted transferees) until (1) with respect to 50% of the insider shares, the earlier of six months after the date of the consummation of our initial business combination and the date on which the closing price of our ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after our initial business combination and (2) with respect to the remaining 50% of the insider shares, six months after the date of the consummation of our initial business combination, or earlier, in either case, if, subsequent to our initial business combination, we consummate a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property.
+
+ 
+ 
+
+ 
+ The private units (including the underlying securities) and working capital units issuable upon conversion of working capital loans will not be transferable, assignable or saleable until the completion of our initial business combination (except to certain permitted transferees).
+
+ 
+ 
+
+ 
+ We refer to such transfer restrictions on insider shares, private units and units issuable upon the conversion of certain working capital loans (including any underlying securities) throughout this prospectus as the lock-up.
+
+ 
+ Representative Shares
+ We will issue 200,000 representative shares to Network 1 (and/or its designees) as part of representative compensation. Network 1 has agreed (i) to waive its redemption rights with respect to such shares in connection with the completion of our initial business combination and (ii) to waive its rights to liquidating distributions from the trust account with respect to such shares if we fail to complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus).
+ 
+ The representative shares have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following the date of the commencement of sales of this offering pursuant to FINRA Rule 5110 (e)(1). Pursuant to FINRA Rule 5110(e)(1), these securities will not be the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the date of the commencement of sales of this offering, nor may they be sold, transferred, assigned, pledged or hypothecated for a period of 180 days immediately following the date of the commencement of sales of this offering except to any underwriter and selected dealer participating in the offering and their officers, partners, registered persons or affiliates.
+
+ 
+ 
+ 22
+ 
+
+ Table of Contents
+ 
+ 
+ Offering proceeds to be held in trust
+ The rules of NASDAQ provide that at least 90% of the gross proceeds from this offering and the sale of the private units be deposited in a trust account. $60,000,000 of the net proceeds of this offering (or $69,000,000 if the over-allotment option is exercised in full), plus $1,050,000 we will receive from the sale of the private units (or $1,207,500 if the over-allotment option is exercised in full), for an aggregate of $61,050,000 (or an aggregate of $70,207,500 if the over-allotment option is exercised in full), or $10.175 per unit sold to the public in this offering (regardless of whether or not the over-allotment option is exercised in full or part) will be placed in a trust account in the United States, maintained by CST, acting as trustee pursuant to an agreement to be signed on the date of this prospectus. Such amount includes $2,100,000, or up to $0.35 per unit (or $2,415,000 if the underwriters over-allotment option is exercised in full), payable to the underwriters as deferred underwriting discounts and commissions. Pursuant to the investment management trust agreement that will govern the investment of such funds, the trustee, upon our written instructions, will direct CST to invest the funds as set forth in such written instructions and to custody the funds while invested and until otherwise instructed in accordance with the investment management trust agreement. The remaining $500,000 of net proceeds of this offering will not be held in the trust account.
+
+ 
+ 
+
+ 
+ Except as set forth below, the proceeds in the trust account will not be released until the earlier of the completion of an initial business combination within the required time period or our entry into liquidation if we have not completed a business combination in the required time period. Therefore, unless and until an initial business combination is consummated, the proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the negotiation of an agreement to acquire a target business.
+
+ 
+ 
+ Notwithstanding the foregoing, there will be released to us from the trust account any interest earned on the funds in the trust account that we need to pay our income or other tax obligations. With these exceptions, expenses incurred by us may be paid prior to a business combination only from the net proceeds of this offering not held in the trust account (estimated to initially be $500,000); provided, however, that in order to meet our working capital needs following the consummation of this offering if the funds not held in the trust account are insufficient, or to extend our life, our insiders, officers and directors or their affiliates/designees may, but are not obligated to, loan us funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each loan would be evidenced by a promissory note. The notes would either be paid upon consummation of our initial business combination, without interest, or, at the lender s discretion, up to $3,000,000 of the notes may be converted upon consummation of our business combination into working capital units at a price of $10.00 per unit. If we do not complete a business combination, the loans would be repaid out of funds not held in the trust account, and only to the extent available.
+
+ 
+ Limited payments to insiders
+ Prior to the consummation of a business combination, there will be no fees, reimbursements or other cash payments paid to our insiders, officers, directors or their affiliates prior to, or for any services they render in order to effectuate, the consummation of a business combination (regardless of the type of transaction that it is) other than:
+
+ 
+ 
+ repayment at the closing of this offering of an aggregate of approximately $500,000 of loans made by our sponsor;
+
+ 
+ 
+ repayment at the closing of this offering of loans which may be made by our insiders, officers, directors or any of its or their affiliates to finance transaction costs in connection with an initial business combination, the terms of which have not been determined; and
+
+ 
+ 
+ reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on our behalf, such as identifying and investigating possible business targets and business combinations.
+
+ 
+ 
+ 23
+ 
+
+ Table of Contents
+ 
+ 
+ 
+ There is no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such expenses exceed the available proceeds not deposited in the trust account, such expenses would not be reimbursed by us unless we consummate an initial business combination. Our audit committee will review and approve all reimbursements and payments made to any insider or member of our management team, or their respective affiliates, and any reimbursements and payments made to members of our audit committee will be reviewed and approved by our board of directors, with any interested director abstaining from such review and approval.
+
+ 
+ Conditions to completing our initial business combination
+ Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the trust account (excluding any deferred underwriters fees and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. If we are no longer listed on Nasdaq, we will not be required to satisfy the 80% test.
+ 
+ If our board is not able to independently determine the fair market value of the target business or businesses, we may obtain an opinion from an independent investment banking or accounting firm as to the fair market value of the target business. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% test, provided that in the event that the business combination involves more than one target business, the 80% test will be based on the aggregate value of all of the target businesses.
+
+ 
+ 
+
+ Potential revisions to agreements with insiders
+ We could seek to amend certain agreements made by our management team disclosed in this prospectus without the approval of shareholders, although we have no intention to do so. For example, restrictions on our executives relating to the voting of securities owned by them, the agreement of our management team to remain with us until the closing of a business combination, the obligation of our management team to not propose certain changes to our organizational documents or the obligation of the management team and its affiliates to not receive any compensation in connection with a business combination could be modified without obtaining shareholder approval. Although shareholders would not be given the opportunity to redeem their shares in connection with such changes, in no event would we be able to modify the redemption or liquidation rights of our shareholders without permitting our shareholders the right to redeem their shares in connection with any such change. We will not agree to any such changes unless we believed that such changes were in the best interests of our shareholders (for example, if such a modification were necessary to complete a business combination).
+
+ 
+ 
+ 24
+ 
+
+ Table of Contents
+ 
+ 
+ Shareholder approval of, or tender offer in connection with, initial business combination
+ In connection with any proposed initial business combination, we will either (1) seek shareholder approval of such initial business combination at a meeting called for such purpose at which public shareholders may seek to convert their public shares, regardless of whether they vote for or against, or abstain from voting on, the proposed business combination, into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable) or (2) provide our public shareholders with the opportunity to sell their public shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. Notwithstanding the foregoing, our insiders have agreed, pursuant to written letter agreements with us, not to convert any public shares held by them into their pro rata share of the aggregate amount then on deposit in the trust account. If we determine to engage in a tender offer, such tender offer will be structured so that each public shareholder may tender any or all of his, her or its public shares rather than some pro rata portion of his, her or its shares. If enough shareholders tender their shares so that we are unable to satisfy any applicable closing condition set forth in the definitive agreement related to our initial business combination, or we are unable to maintain net tangible assets of at least $5,000,001 upon consummation of the proposed business combination, we will not consummate such initial business combination. The decision as to whether we will seek shareholder approval of a proposed business combination or will allow shareholders to sell their shares to us in a tender offer will be made by us based on a variety of factors such as the timing of the transaction, or whether the terms of the transaction would otherwise require us to seek shareholder approval. If we so choose and we are legally permitted to do so, we will have the flexibility to avoid a shareholder vote and allow our shareholders to sell their shares pursuant to Rule 13e-4 and Regulation 14E of the Securities Exchange Act of 1934, as amended, or Exchange Act, which regulate issuer tender offers. In that case, we will file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. We will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 upon such consummation and, solely if we seek shareholder approval, a majority of the issued and outstanding ordinary shares voted are voted in favor of the business combination.
+
+ 
+ 
+
+ 
+ However, if we seek to consummate a business combination with a target business that imposes any type of working capital closing condition or requires us to have a minimum amount of funds available from the trust account upon consummation of such business combination, the net tangible asset requirement may limit our ability to consummate such a business combination and may force us to seek third party financing which may not be available on terms acceptable to us or at all. As a result, we may not be able to consummate such business combination and we may not be able to locate another suitable target within the applicable time period, if at all.
+
+ 
+ 
+ 25
+ 
+
+ Table of Contents
+ 
+ 
+ Our insiders have agreed (i) to vote their insider shares and private shares and any public shares purchased in or after this offering in favor of any proposed business combination and (ii) not to convert any shares (including the insider shares or private shares) in connection with a shareholder vote to approve, or sell their shares to us in any tender offer in connection with, a proposed initial business combination. Assuming the over-allotment option is not exercised and the insiders do not purchase any units in this offering or units or shares in the after-market, our insiders including our sponsor, directors and officers, collectively represent 23.00% of issued and outstanding ordinary shares on converted basis. As a result, for purpose of seeking shareholder approval for our initial business combination, in addition to our insider shares and private shares, we would need additional 832,000 public shares to vote in order to obtain a quorum which will be, pursuant to the amended and restated memorandum and articles of association that we will adopt immediately prior to or upon the effectiveness of this prospectus, one-third of our issued and outstanding ordinary shares entitled to vote at the meeting. Once a quorum is obtained, (i) assuming only a quorum is present and voted at such meeting held to vote on our initial business combination, no public shares sold in this offering are needed to be voted in favor of a transaction, or (ii) assuming all issued and outstanding shares are present and voted, we need additional 2,174,001, or 36.23%, of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction (None of our officers, directors, initial shareholders or their affiliates has indicated any intention to purchase units in this offering or any units or ordinary shares in the open market or in private transactions , other than the private units). Additionally, each public shareholder may elect to redeem its public shares irrespective of whether it votes for or against, or abstain from voting on, the proposed transaction (subject to the limitation described in this prospectus). However, if a significant number of shareholders vote, or indicate an intention to vote, against a proposed business combination, our officers, directors, insiders or their affiliates could make such purchases in the open market or in private transactions in order to influence the vote. There is no limit on the number of shares that may be purchased by the insiders. Any purchases would be made in compliance with federal securities laws, including the fact that all material information will be made public prior to such purchase, and no purchases would be made if such purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act, which are rules designed to stop potential manipulation of a company s stock.
+
+ 
+ 
+
+ Redemption rights
+ In connection with a business combination, public shareholders will have the right to convert their shares into an amount equal to (1) the number of public shares being converted by such public holder divided by the total number of public shares multiplied by (2) the amount then in the trust account (initially $10.175 per share), which includes the deferred underwriting discounts and commissions plus a pro rata portion of any interest earned on the funds held in the trust account less any amounts necessary to pay our taxes. At any meeting called to approve an initial business combination, public shareholders may elect to convert their share regardless of whether or not they vote to approve the business combination.
+
+ 
+ 
+
+ 
+ Whether we elect to effectuate our initial business combination via shareholder vote or tender offer, we may require public shareholders wishing to exercise redemption rights, whether they are a record holder or hold their shares in street name, to either tender the certificates they are seeking to convert to our transfer agent or to deliver the shares they are seeking to convert to the transfer agent electronically using Depository Trust Company s DWAC (Deposit / Withdrawal At Custodian) System, at the holder s option, at any time at or prior to the vote on the business combination. There is a nominal cost associated with this tendering process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the tendering broker $120 and it would be up to the broker whether or not to pass this cost on to the converting holder. The foregoing is different from the procedures used by traditional blank check companies. In order to perfect redemption rights in connection with their business combinations, many traditional blank check companies would distribute proxy materials for the shareholders vote on an initial business combination, and a holder could simply vote against a proposed business combination and check a box on the proxy card indicating such holder was seeking to exercise its redemption rights. After the business combination was approved, the company would contact such shareholder to arrange for it to deliver its certificate to verify ownership. As a result, the shareholder then had an option window after the consummation of the business combination during which it could monitor the price of the company s stock in the market. If the price rose above the conversion price, it could sell its shares in the open market before actually delivering his shares to the company for cancellation. As a result, the redemption rights, to which shareholders were aware they needed to commit before the shareholder meeting, would become an option right surviving past the consummation of the business combination until the converting holder delivered its certificate. The requirement for physical or electronic delivery prior to the closing of the shareholder meeting ensures that a holder s election to convert is irrevocable once the business combination is completed.
+
+ 
+ 
+ 26
+ 
+
+ Table of Contents
+ 
+ 
+ Pursuant to our amended and restated memorandum and articles of association, we are required to give a minimum of only five days notice for each general meeting. As a result, if we require public shareholders who wish to convert their ordinary shares into the right to receive a pro rata portion of the funds in the trust account to comply with the foregoing delivery requirements, holders may not have sufficient time to receive the notice and deliver their shares for conversion. Accordingly, investors may not be able to exercise their redemption rights and may be forced to retain our securities when they otherwise would not want to.
+
+ 
+ 
+
+ 
+ If we require public shareholders who wish to convert their ordinary shares to comply with specific delivery requirements for conversion described above and such proposed business combination is not consummated, we will promptly return such certificates to the tendering public shareholders.
+
+ 
+ 
+
+ 
+ Please see the risk factors titled In connection with any shareholder meeting called to approve a proposed initial business combination, we may require shareholders who wish to convert their public shares to comply with specific requirements for conversion that may make it more difficult for them to exercise their redemption rights prior to the deadline for exercising their rights and If we require public shareholders who wish to convert their ordinary shares to comply with the delivery requirements for conversion, such converting shareholders may be unable to sell their securities when they wish to in the event that the proposed business combination is not approved. 
+
+ 
+ 
+
+ 
+ Once the shares are converted by the holder, and effectively redeemed by us under the Cayman Islands law, the transfer agent will then update our Register of Members to reflect all conversions.
+
+ 
+ 
+
+ Limitation on redemption rights of shareholders holding 15% or more of the shares sold in this offering if we hold shareholder vote
+ Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against, or abstain from voting on, our business combination.
+
+ 
+ 
+ 27
+ 
+
+ Table of Contents
+ 
+ 
+ Redemption rights in connection with proposed amendments to our articles of association
+ Some other blank check companies have a provision in their charter which prohibits the amendment of certain charter provisions. Our amended and restated articles of association will provide that any of its provisions, including those related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement of rights into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein) may be amended if approved by holders of at least two thirds of our ordinary shares entitled to vote thereon, subject to applicable provisions of the Cayman Islands law, or the Companies Act, or applicable stock exchange rules. Corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of two thirds of our ordinary shares entitled to vote thereon. We may not issue additional securities that can vote on amendments to our amended and restated articles of association or in our initial business combination or that would entitle holders to receive funds from the trust account. Our insiders, who will collectively beneficially own 23.00% of our ordinary shares upon the closing of this offering (assuming the over-allotment option is not exercised and they do not purchase any units in this offering), will participate in any vote to amend our amended and restated articles of association and/or trust agreement and will have the discretion to vote in any manner they choose. Our insiders have agreed, pursuant to a letter agreement with us (filed as an exhibit to the registration statement of which this prospectus forms a part), that they will not propose any amendment to our amended and restated articles of association (i) that would modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or (ii) with respect to any other material provision relating to shareholders rights or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. Our insiders have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any insider shares, private shares and any public shares held by them in connection with the completion of our initial business combination and to waive their redemption rights with respect to their insider shares, private sharesand public shares in connection with a shareholder vote to approve an amendment to our amended and restated articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity. 
+
+ 
+ 
+ 28
+ 
+
+ Table of Contents
+ 
+ Release of funds in trust account on closing of our initial business combination
+ On the completion of our initial business combination, all amounts held in the trust account will be released to us. We will use these funds to pay amounts due to any public shareholders who exercise their redemption rights as described above under Redemption rights, to pay the underwriters their deferred underwriting compensation, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt instruments, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other assets, companies or for working capital.
+
+ 
+ Automatic liquidation if no business combination
+ As described above, if we fail to consummate a business combination within 9 months from the consummation of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), it will trigger our automatic winding up, liquidation and subsequent dissolution pursuant to the terms of our amended and restated memorandum and articles of association. As a result, this has the same effect as if we had formally gone through a voluntary liquidation procedure under the Companies Act. Accordingly, no vote would be required from our shareholders to commence such a voluntary winding up, liquidation and subsequent dissolution. 
+
+ 
+ 
+ The amount in the trust account (including the deferred underwriting compensation) under the Companies Act will be available for distribution under the Companies Act provided that immediately following the date on which the proposed distribution is to be made, we are able to pay our debts as they fall due in the ordinary course of business, and the value of the Company s assets exceed its liabilities. If we are forced to liquidate, we anticipate that we would distribute to our public shareholders the amount in the trust account calculated as of the date that is two (2) days prior to the distribution date (including any accrued interest net of taxes payable).
+
+ 
+ 
+ 29
+ 
+
+ Table of Contents
+ 
+ 
+ Prior to such distribution, we would be required to assess all claims that may be potentially brought against us by our creditors for amounts they are actually owed and make provision for such amounts, as creditors take priority over our public shareholders with respect to amounts that are owed to them. We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our shareholders could potentially be liable for any claims of creditors to the extent of distributions received by them as voidable transaction in the event we enter an insolvent liquidation. Furthermore, while we will seek to have all vendors and service providers (which would include any third parties we engaged to assist us in any way in connection with our search for a target business) and prospective target businesses execute agreements with us waiving any right, title, interest or claim of any kind they may have in or to any monies held in the trust account, there is no guarantee that they will execute such agreements. Nor is there any guarantee that, even if such entities execute such agreements with us, they will not seek recourse against the trust account or that a court would conclude that such agreements are legally enforceable.
+
+ 
+ 
+
+ 
+ The holders of the insider shares, private units and representative shares will not participate in any liquidation distribution with respect to such securities.
+
+ 
+ 
+ Our sponsor has contractually agreed pursuant to a written agreement with us that, if we liquidate the trust account prior to the consummation of a business combination, it will be liable to ensure that the proceeds in the trust account are not reduced by the claims of target businesses or claims of vendors or other entities that are owed money by us for services rendered or contracted for or products sold to us. Accordingly, if a claim brought by a target business or vendor did not exceed the amount of funds available to us outside of the trust account, our sponsor would not have any obligation to indemnify such claims as they would be paid from such available funds. However, if a claim exceeded such amounts, the only exceptions to our sponsor s obligations to pay such claim would be if the party executed an agreement waiving any right, title, interest or claim of any kind it has in or to any monies held in the trust account. We cannot assure you that our sponsor will be able to satisfy these obligations if he is required to do so. Therefore, we cannot assure you that the per-share redemption price from the trust account, if we liquidate the trust account because we have not completed a business combination within the required time period, and assuming that we do not extend out life beyond 9 months (or up to 15 months if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) prior to a business combination, will not be less than $10.175. 
+
+ 
+ 
+
+ 
+ We will pay the costs of liquidating the trust account from our remaining assets outside of the trust account. If such funds are insufficient, our sponsor has contractually agreed to advance us the funds necessary to complete such liquidation (currently anticipated to be no more than approximately $100,000) and has contractually agreed not to seek repayment for such expenses.
+
+ 
+ 
+ The underwriters have agreed to waive their rights to the deferred underwriting discounts and commissions held in the trust account in the event we do not consummate a business combination within 9 months (or up to 15 months as described in this prospectus) from the closing of this offering and in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares.
+
+ 
+ 
+ 30
+ 
+
+ Table of Contents
+ 
+ Indemnity
+ Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.175 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.175 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
+
+ 
+ 
+
+ Audit Committee
+ Subject to phase-in rules, we will establish and maintain an audit committee, which will be composed entirely of independent directors to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled Management Audit Committee. 
+
+ 
+ 
+
+ Conflicts of Interest
+ Although we do not believe any conflict currently exists between us and our insiders or their affiliates, our insiders and management or their affiliates may compete with us for acquisition opportunities. If such entities decide to pursue an opportunity, we may be precluded from procuring such opportunity. None of our insiders or their respective affiliates will have any obligation to present us with any opportunity for a potential business combination of which they become aware, unless presented to such member specifically in his or her capacity as an officer or director of the Company. Our management team, in their capacities as employees or affiliates of our insiders or in their other endeavors, may be required to present potential business combinations to future insiders affiliates or third parties, before they present such opportunities to us.
+
+ 
+ 
+
+ 
+ Our officers may become an officer or director of any other special purpose acquisition company with a class of securities registered under the Exchange Act, even before we enter into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination within 9 months after the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus). Mr. Mingyu (Michael) Li, our Chief Executive Officer and Chief Financial Officer, has fiduciary and contractual duties to Lakeshore Acquisition II Corp., a special acquisition purpose company, currently listing on The Nasdaq Global Market (Nasdaq: LBBB) ( Lakeshore II ). Lakeshore II may compete with us for business combination opportunities. If Lakeshore II decides to pursue any such opportunity, we may be precluded from pursuing such opportunities. Subject to his fiduciary duties under Cayman Islands law, none of the members of our management team who are also employed by, or directors of, our sponsor or its affiliates have any obligation to present us with any opportunity for a potential business combination of which they become aware. Our sponsor, directors and officers are also not prohibited from sponsoring, investing or otherwise becoming involved with, any other blank check companies, including in connection with their initial business combinations, prior to us completing our initial business combination. Our management team, in their capacities as directors, officers or employees of our sponsor or its affiliates or in their other endeavors, may choose to present potential business combinations to the related entities described above, current or future entities affiliated with or managed by our sponsor, or third parties, before they present such opportunities to us, subject to his or her fiduciary duties under Cayman Islands law and any other applicable fiduciary duties. Our amended and restated memorandum and articles of association will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis.
+
+ 
+ 
+ 31
+ 
+
+ Table of Contents
+ 
+ RISKS FACTORS SUMMARY
+ 
+ We are a blank check company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision on whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company, as well as the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act and, therefore, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see Proposed Business Comparison to offerings of blank check companies subject to Rule 419. You should carefully consider these, and the other risks set forth in the section entitled Risk Factors beginning on page 36 of this prospectus.
+ 
+ Such risks include, but are not limited to:
+ 
+ Risks Associated with Our Business
+ 
+ 
+ If we are unable to consummate a business combination, our public shareholders may be forced to wait more than 9 months (or up to 15 months if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) before receiving liquidation distributions.
+
+ 
+ 
+ We may be unable to obtain additional financing, if required, to complete a business combination or to fund the operations and growth of the target business, which could compel us to restructure or abandon a particular business combination.
+
+ 
+ 
+ Holders of warrants or rights will not have redemption rights if we are unable to complete an initial business combination within the required time period.
+
+ 
+ 
+ Our officers and directors have pre-existing fiduciary and contractual obligations and accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented.
+
+ 
+ 
+ Our public shareholders may not be afforded an opportunity to vote on our proposed business combination, which means we may consummate our initial business combination even though a majority of our public shareholders do not support such a combination.
+
+ 
+ 
+ The value of the insider shares following completion of our initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of our ordinary shares at such time is substantially less than $10.175 per share.
+
+ 
+ 
+ Our outstanding warrants and rights may have an adverse effect on the market price of our ordinary shares and make it more difficult to effect a business combination.
+
+ 
+ 
+ You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares, potentially at a loss.
+
+ 
+ Risks Associated with Acquiring and Operating a Business Outside of the United States
+ 
+ 
+ Because of the costs and difficulties inherent in managing cross-border business operations, our results of operations may be negatively impacted.
+
+ 
+ 
+ Many countries have difficult and unpredictable legal systems and underdeveloped laws and regulations that are unclear and subject to corruption and inexperience, which may adversely impact our results of operations and financial condition.
+
+ 
+ 
+ If we effect a business combination with a company located outside of the United States, the laws applicable to such company will likely govern all of our material agreements and we may not be able to enforce our legal rights.
+
+ 
+ 
+ Upon the effectiveness of this prospectus, certain of our executive officers and directors will be located outside the United States; therefore, investors may not be able to enforce federal securities laws or their other legal rights upon those officers and directors located outside the United States.
+
+ 
+ 
+ 32
+ 
+
+ Table of Contents
+ 
+ Risks Related to Our Possible Business Combination with a PRC Target Company 
+ 
+ See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company beginning from page 67 of this prospectus for further discussion.
+ 
+ 
+ 
+ As a blank check company incorporated for the purpose of effecting a business combination, we have significant ties to China. Mr. Mingyu (Michael) Li, our Chief Executive Officer and Chief Financial Officer, who is also the sole member and sole director of our sponsor, is located in China. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company Because we have significant ties to China, it is uncertain whether that would make us a less attractive partner to a non-China-based target company and such perception may potentially limit or negatively impact our search for an initial business combination, or may therefore make it more likely for us to consummate a business combination with a PRC Target Company. on page 67 of this prospectus.
+
+ 
+ 
+ 
+ If we effect our initial business combination with a PRC Target Company, the laws of the country in which such business operates will govern almost all of the material agreements relating to its operations, including any VIE Agreements through which the post-combination entity consolidate the financial results of the VIE as primary beneficiary in accordance with the U.S. GAAP or IFRS for accounting purpose. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company If we effect our initial business combination with a PRC Target Company, the laws applicable to such business will likely govern all of our material agreements and we may not be able to enforce our legal rights. on page 67 of this prospectus.
+
+ 
+ 
+ 
+ Our post-combination entity may conduct most of its operations and most of its revenue is generated in the PRC. Accordingly, economic, political and legal developments in the PRC will significantly affect our post-combination entity s business, financial condition, results of operations and prospects. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company Changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be quick with little advance notice and could have a significant impact upon our ability to operate profitably in the PRC. on page 90 of this prospectus.
+
+ 
+ 
+ 
+ If the CSRC or another PRC regulatory body subsequently determines that its approval is needed for this offering, a business combination, the issuance of our ordinary shares upon exercise of the rights, or maintaining our status as a publicly listed company outside China, we may face approval delays, adverse actions or sanctions by the CSRC or other PRC regulatory agencies. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company China Securities Regulatory Commission and other Chinese government agencies may exert more oversight and control over offerings that are conducted overseas and foreign investment in China-based issuers. If the CSRC or another PRC regulatory body subsequently determines that its approval is needed for this offering, we cannot predict whether we will be able to obtain such approval. As a result, both you and us face uncertainty about future actions by the PRC government that could significantly affect our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless. on page 90 of this prospectus.
+
+ 
+ 
+ 
+ Our initial business combination may be subject to PRC laws relating to the collection, use, sharing, retention, security, and transfer of confidential and private information, such as personal information and other data. These laws continue to develop, and the PRC government may adopt other rules and restrictions in the future. Non-compliance could result in penalties or other significant legal liabilities. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company In light of recent events indicating greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, companies with more than one million users personal information in China, especially some internet and technology companies, may not be willing to list on a U.S. stock exchange or enter into a definitive business combination agreement with us. Further, we may also avoid a business combination with a company with more than one million users personal information in China due to the limited timeline for us to complete a business combination. on page 85 of this prospectus.
+
+ 
+ 
+ 
+ The Chinese government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof, and could require us to divest ourselves of any interest we then hold in Chinese properties. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company The Chinese government may exercise significant oversight and discretion over the conduct of the post-combination entity s business and may intervene in or influence its operations at any time, which could result in a material change in its operations and/or the value of our securities. We are also currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if the PRC Target Company and the VIE were required to obtain approval in the future and were denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing on a U.S. exchange, which would materially affect the interest of our investors. on page 88 of this prospectus.
+
+ 
+ 
+ 
+ Because our significant ties to China, we may pursue a business combination with a PRC Target Company which might require a VIE structure. There are substantial uncertainties regarding the interpretation and application of current and future PRC laws, regulations and rules. The PRC regulatory authorities may ultimately take a view that is contrary to the accepted industry practices with respect to the VIE Agreements. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company If the government of the PRC finds that the VIE Agreements we entered into to allow us to consolidate the financial results of a target business do not comply with local governmental restrictions on foreign investment, or if these regulations or the interpretation of existing regulations change in the future, we could be subject to significant penalties or be forced to relinquish our interests in those operations or the post-combination entity could be unbale to consolidate the financial results of the VIE, which could cause the value of our securities depreciate significantly or become worthless. on page 71 of this prospectus.
+
+ 
+ 
+ 
+ We cannot assure you the PRC regulatory authorities will not impose further restrictions on the convertibility of the Renminbi. Any future restrictions on currency exchanges may limit our ability to use the proceeds of this offering in an initial business combination with a PRC Target Company and the use our cash flow for the distribution of dividends to our shareholders or to fund operations we may have outside of the PRC. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company Exchange controls that exist in the PRC may restrict or prevent us from using the proceeds of this offering to acquire a PRC Target Company and limit our ability to utilize our cash flow effectively following our initial business combination. on page 83 of this prospectus.
+
+ 
+ 
+ 33
+ 
+
+ Table of Contents
+ 
+ 
+ 
+ We cannot provide assurance that our shareholders that are PRC residents comply with all of the requirements under SAFE Circular 37 or other related rules. It is unclear how these regulations, and any future regulation concerning offshore or cross-border transactions, will be interpreted, amended and implemented by the relevant government authorities. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company PRC regulations relating to offshore investment activities by PRC residents may limit our ability to inject capital in our Chinese subsidiaries and Chinese subsidiaries ability to change their registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC laws. on page 70 of this prospectus.
+
+ 
+ 
+ 
+
+ 
+ 
+ Any future action by the PRC government expanding the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or the CAC could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company The PRC government may intervene or influence the PRC Target Company s business operations at any time or may exert more control over offerings conducted overseas and/or foreign investment in China based issuers, which could result in a material change in the PRC Target Company s business operations post business combination and/or the value of our securities. Additionally, the governmental and regulatory interference could significantly limit or completely hinder our ability to offer or continue to offer securities to investors post business combination and cause the value of such securities to significantly decline or be worthless. on page 74 of this prospectus.
+
+ 
+ 
+ 
+
+ 
+ 
+ Controlling or non-controlling investments in U.S. businesses that produce, design, test, manufacture, fabricate or develop one or more critical technologies in one of 27 identified industries including aviation, defense, semiconductors, telecommunications and biotechnology are subject to a mandatory filing with the CFIUS. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company We may not be able to complete an initial business combination with a U.S. target company if such initial business combination is subject to U.S. foreign investment regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States (CFIUS), or ultimately prohibited. on page 75 of this prospectus.
+
+ 
+ 
+ 
+ If it is later determined that the PCAOB is unable to inspect or investigate completely our auditor because of a position taken by an authority in a foreign jurisdiction, Nasdaq would delist our securities, including our units, ordinary shares, redeemable warrants, rights being offered in this offering, and the SEC shall prohibit them from being traded on a national securities exchange or in the over the counter trading market in the U.S. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company Trading in our securities may be prohibited under the Holding Foreign Companies Accountable Act if the PCAOB determines that it cannot inspect or fully investigate our auditor. In that case, Nasdaq would delist our securities. The delisting of our securities, or the threat of their being delisted, may materially and adversely affect the value of your investment. Additionally, the inability of the PCAOB to conduct inspections may deprive our investors with the benefits of such inspections. on page 75 of this prospectus.
+
+ 
+ 
+ 
+ The lack of PCAOB inspections of audit work undertaken in mainland China or Hong Kong prevents the PCAOB from regularly evaluating mainland China or Hong Kong auditor s audits and its quality control procedures. As a result, shareholders may be deprived of the benefits of PCAOB inspections if we complete a business combination with such companies. See Risk Factors Risks Related to Our Possible Business Combination with a PRC Target Company U.S. laws and regulations, including the Holding Foreign Companies Accountable Act and Accelerating Holding Foreign Companies Accountable Act, may restrict or eliminate our ability to complete a business combination with certain companies, particularly those acquisition candidates with substantial operations in mainland China or Hong Kong. on page 77 of this prospectus.
+
+ 
+ 
+ 34
+ 
+
+ Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/IAUM_ishares_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/IAUM_ishares_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/IAUM_ishares_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/IMUC_eom_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/IMUC_eom_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..ffe7df016833e28bc410717d524ab936feb520d9
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/IMUC_eom_prospectus_summary.txt
@@ -0,0 +1,397 @@
+prospectus summary. Some of these risks include:
+
+ 
+
+ 
+ 
+ 
+ We
+ are a pre-revenue company with a limited operating history. Since inception, we have incurred significant operating losses. At September
+ 30 2022, we had an accumulated deficit of approximately $8.8 million; 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ will need substantial additional funding to finance our operations through regulatory approval of one or more of our product candidates.
+ If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our product development programs
+ or commercialization efforts;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ To
+ date, we have been primarily funded by the Goldberger family. Eli Goldberger is our co-founder, Chairman, Chief Operating
+ Officer and largest stockholder. There can be no assurance that the Goldberger family will continue to fund our operations on favorable
+ terms, if at all. We currently expect to use $688,000 of the net proceeds from this offering to repay approximately 25% of
+ the principal on the outstanding promissory note issued to a member of the Goldberger family.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ are entirely dependent on the success of our drug product candidates. If we are unable to obtain regulatory approval or commercialize
+ one or more of these experimental treatments, or experience significant delays in doing so, our business will be materially harmed;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The FDA might not allow us to pursue the Section 505(b)(2)
+ pathway for EOM613 and EOM147 and, if so, we may be unable to meet our anticipated development and commercialization timelines and
+ may be unable to generate the additional required data at a reasonable cost;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may not be able to successfully develop or commercialize our existing drug product candidates or develop new drug product candidates
+ on a timely or cost-effective basis;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ business may be negatively affected by the ongoing COVID-19 pandemic;
+
+ 
+ 
+
+ 
+ 
+ 
+ We
+ depend on a limited number of drug product candidates and our business could be materially adversely affected if one or more of our
+ key drug product candidates do not perform as well as expected and do not receive regulatory approval;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may be in the future, a party to legal proceedings that could result in adverse outcomes;
+
+ 
+ 
+
+ 7
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our
+ competitors and other third parties may allege that we are infringing their intellectual property, forcing us to expend substantial
+ resources in resulting litigation, and any unfavorable outcome of such litigation could have a material adverse effect on our business;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may experience failures of or delays in clinical trials which could jeopardize or delay our
+ ability to obtain regulatory approval and commence product commercialization;
+
+ 
+
+ 
+ 
+ 
+ We
+ face intense competition from both brand and generic companies who have significant financial
+ resources which could limit our growth and adversely affect our financial results;
+
+ 
+
+ 
+ 
+ 
+ Our
+ employees, principal investigators, consultants and commercial partners may engage in misconduct or other improper activities, including
+ noncompliance with regulatory standards and requirements and insider trading, which could cause significant liability for us and
+ harm our reputation. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ will be competing against large existing well-funded pharmaceutical companies with existing and proposed competing products.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ are subject to extensive governmental regulation and we face significant uncertainties and potentially significant costs associated
+ with our efforts to comply with applicable regulations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may not be able to develop or maintain our sales capabilities or effectively market or sell our products;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Manufacturing
+ or quality control problems may damage our reputation, require costly remedial activities or otherwise negatively impact our business;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ profitability may depend on coverage and reimbursement by third-party payors including government agencies, and healthcare reform
+ and other future legislation may lead to reductions in coverage or reimbursement levels;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ face risks related to health epidemics and outbreaks, including the COVID-19 pandemic, which could significantly disrupt our preclinical
+ studies and clinical trials, research activities and therefore our receipt of necessary regulatory approvals could be delayed or
+ prevented;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We do not currently own any patents and our technology
+ is largely based on expired patents. If we are unable to obtain and maintain patent protection for our product candidates we may
+ develop, or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize
+ products and technology similar or identical to ours, and our ability to successfully commercialize our products we may develop may
+ be adversely affected;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ currently, and may in the future need to, license certain intellectual property from third parties, and such licenses may not be
+ available or may not be available on commercially reasonable terms;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent,
+ which might adversely affect our ability to develop, manufacture and market our products and product candidates;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If
+we fail to comply with our obligations under any of our third-party agreements, we could lose license rights that are necessary to develop
+our product candidates; 
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ After
+ this offering, our directors, executive officers and certain stockholders (one of which is an affiliate of our Founder and Chief
+ Operating Officer) will continue to own a majority of our common stock and, if they choose to act together, will be able to exert
+ absolute control over matters subject to stockholder approval.
+
+ 
+ 
+
+ 8
+
+ 
+
+ 
+
+ 
+
+Summary
+of the Offering
+
+ 
+
+ 
+ Shares
+ being Offered:
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ Stock Outstanding
+
+ Before
+ this Offering
+
+ 
+ 113,270,751
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ Stock Outstanding
+
+ After
+ this Offering
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of Proceeds
+ 
+ We
+ expect to receive net proceeds, after deducting underwriting discounts and commissions and
+ estimated expenses payable by us, of approximately $_____ million (or approximately $______
+ million if the underwriters exercise their option to purchase additional shares in full).
+
+ 
+
+ We
+ intend to use substantially all of the net proceeds from this offering to continue to fund research and development of our EOM613
+ and EOM147 drug candidates, conduct clinical trials, repay a portion of our outstanding Convertible Promissory Note issued to a principal
+ stockholder, and for working capital and other general corporate purposes. See "Use of Proceeds"
+
+ 
+
+ 
+ Underwriters 
+ over-allotment option
+ 
+ We
+ have granted the underwriters a 45-day option from the date of this prospectus to purchase up to an additional _________ shares (15%
+ of the total number of shares to be offered by us in the offering).
+
+ 
+ 
+ 
+ 
+
+ 
+ Trading
+ Market for our Common
+
+ Stock
+
+ 
+ Our
+ Common Stock is currently traded on the Pink Sheets of the OTC Market under the symbol "IMUC". We have applied to have
+ our Common Stock listed for trading on the Nasdaq Capital Market. There can be no assurance that our Common Stock will be approved
+ for trading on the Nasdaq.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/INDO_indonesia_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/INDO_indonesia_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/INDO_indonesia_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/IVDAW_iveda_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/IVDAW_iveda_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..9ce411519adf5885226ee081f7edb4b5956491a9
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/IVDAW_iveda_prospectus_summary.txt
@@ -0,0 +1 @@
+F-39 NOTE 8 EARNINGS (LOSS) PER SHARE The following table provides a reconciliation of the numerators and denominators reflected in the basic and diluted earnings per share computations, as required by ASC No. 260, Earnings per Share. Basic earnings per share ( EPS ) is computed by dividing reported earnings available to stockholders by the weighted average shares outstanding. We had net losses for the years ended December 31, 2021 and 2020 and the effect of including dilutive securities in the earnings per common share would have been anti-dilutive for the purpose of calculating EPS. Accordingly, all options, warrants, and shares potentially convertible into common shares were excluded from the calculation of diluted earnings per share for the periods ended December 31, 2021 and 2020. SCHEDULE OF EARNINGS PER SHARE BASIC AND DILUTED December 31, 2021 December 31, 2020 Basic EPS Net Loss $(2,998,644) $(1,602,303) Weighted Average Shares 71,522,940 51,718,895 Basic Loss Per Share $(0.04) $(0.03) NOTE 9 CONTINGENT LIABILITIES TAIWAN Pursuant to certain contracts with Siemens, Chung-Hsin Electric and Machinery Manufacturing Corp, MEGAsys is required to provide after-project services. If MEGAsys fails to provide these after-project services in the future, other parties of the related contract would have recourse. The financial exposure to MEGAsys in the event of failure to provide after- project services in the future as of December 31, 2021 is $61,435. NOTE 10 SUBSEQUENT EVENTS F-40
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/JOCM_jocom_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/JOCM_jocom_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..b17e36b056799777be2797d3d9473ed3343c18bb
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/JOCM_jocom_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1/A 1 jocom_s1a4.htm S-1/A UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1/A AMENDMENT NO. 4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 CURRENT REPORT Jocom Holdings Corp. (Exact name of registrant as specified in its charter) Date: November 30, 2022 Nevada 7380 38-4177722 (State or Other Jurisdiction of Incorporation) (Primary Standard Classification Code) (IRS Employer Identification No.) Unit No. 11-1, Level 11, Tower 3, Avenue 3 Bangsar South, No. 8 Jalan Kerinchi, 59200 Kuala Lumpur. Issuer's telephone number: +6012 3399937 Company email: corporate@jocom.my Copy To: Carl P. Ranno 2733 East Vista Drive Phoenix, Arizona 85032 Telephone: 602-402-3615 Email: carlranno@cox.net Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. |X| If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, please check the following box and list the Securities Act registration Statement number of the earlier effective registration statement for the same offering. |_| If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.|_| If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.|_| Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer |_| Accelerated filer |_| Non-accelerated filer |X| Smaller reporting company |X| Emerging growth company |X| If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. |_| CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered Proposed Maximum Offering Price Per Share(1) Proposed Maximum Aggregate Offering Price Amount of Registration Fee (2) Common Stock, $0.0001 par value 6,500,000 $1.00 6,500,000 602.55 (1) The offering price has been arbitrarily determined by the Company and bears no relationship to assets, earnings, or any other valuation criteria. No assurance can be given that the shares offered hereby will have a market value or that they may be sold at this, or at any price. (2) Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(o) of the Securities Act of 1933. The Registrant hereby amends this Registration Statement (the "Registration Statement") on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where an offer or sale is not permitted. There is no minimum purchase requirement for the offering to proceed. PRELIMINARY PROSPECTUS Jocom Holdings Corp. 6,500,000 SHARES OF COMMON STOCK $0.0001 PAR VALUE PER SHARE Prior to this Offering, no public market has existed for the common stock of Jocom Holdings Corp. Upon completion of this Offering, we will attempt to have the shares quoted on the OTCQB operated by OTC Markets Group, Inc. There is no assurance that the Shares will ever be quoted on the OTCQB. To be quoted on the OTCQB, a market maker must apply to make a market in our common stock. As of the date of this Prospectus, we have not made any arrangement with any market makers to quote our shares. Additionally, there is the possibility a market maker may not apply to make a market in our common stock. If this were to occur, your investment may be negatively impacted as you may be unable to sell your shares. In this public offering we, "Jocom Holdings Corp." are offering 500,000 shares of our common stock and our selling shareholders are offering 6,000,000 shares of our common stock at a price of $1.00 per share. We will not receive any of the proceeds from the sale of shares by the selling shareholders. The offering is being made on a self-underwritten, "best efforts" basis. There is no minimum number of shares required to be purchased by each investor. The shares offered by the Company will be sold on our behalf by our Chief Executive Officer and Director, Mr. Sew Wen Chean and our Chief Financial Officer, Ms. Chua Hwee Ping, are deemed to be underwriters of this offering. The selling shareholders are also deemed to be underwriters of this offering. There is no certainty that we will be able to sell any of the 500,000 shares being offered herein by the Company. Mr. Sew and Ms. Chua will not receive any commissions or proceeds for selling the shares on our behalf. All of the shares being registered for sale by the Company will be sold at a fixed price of $1.00 per share for the duration of the Offering. Additionally, all of the shares offered by the selling shareholders will be sold at a fixed price of $1.00 per share for the duration of the Offering. Assuming all of the 500,000 shares being offered by the Company are sold, the Company will receive $500,000 in net proceeds. Assuming 375,000 shares (75%) being offered by the Company are sold, the Company will receive $375,000 in net proceeds. Assuming 250,000 shares (50%) being offered by the Company are sold, the Company will receive $250,000 in net proceeds. Assuming 125,000 shares (25%) being offered by the Company are sold, the Company will receive $125,000 in net proceeds. There is no minimum amount we are required to raise from the shares being offered by the Company and any funds received will be immediately available to us. The net proceeds on a per share basis are displayed in the following table: 500,000 shares to be offered by Jocom Holdings Corp. for cash Per share Total Initial public offering price $ 1.00 $ 500,000 Underwriting commissions, discounts and fees $ 0.00 $ 0.00 Net proceeds, before expenses to Jocom Holdings Corp. $ 1.00 $ 500,000 6,000,000 shares to be offered by selling stockholders for cash Per share Total Initial public offering price $ 1.00 $ 6,000,000 Underwriting commissions, discounts and fees $ 0.00 $ 0.00 Net proceeds, before expenses to selling stockholders $ 1.00 $ 6,000,000 There is no guarantee that we will sell any of the securities being offered in this offering. Additionally, there is no guarantee that this Offering will successfully raise enough funds to further our Company's business plan going forward, and additional funding avenues may be necessary. This primary offering will terminate upon the earliest of (i) such time as all of the common stock has been sold pursuant to the registration statement or (ii) 365 days from the effective date of this Prospectus, unless extended by our directors for an additional 90 days. We may however, at any time and for any reason terminate the offering. Our Chief Executive Officer and Director, Mr. Sew Wen Chean, will be selling shares of common stock on behalf of the Company simultaneously to selling shares of common stock in the Company from his own personal account. A conflict of interest may arise as a result of Mr. Sew selling shares from his own personal account, and in selling shares on the Company s behalf. Currently, Mr. Sew Wen Chean owns and controls 19,000,000 shares of our common stock. Our Chief Financial Officer, President, Secretary, Treasurer and Director, Ms. Chua Hwee Ping, will be selling shares of common stock on behalf of the Company simultaneously to selling shares of common stock in the Company from her own personal account. A conflict of interest may arise as a result of Ms. Chua selling shares from her own personal account, and in selling shares on the Company s behalf. Currently, Ms. Chua Hwee Ping owns and controls 19,000,000 shares of our common stock. As of the date of this Registration Statement, our Directors, Sew Wen Chean, and Chua Hwee Ping, each control approximately 32.99% of the voting power of the Company. All shares being offered pursuant to this Registration Statement will be sold at a fixed price of $1.00 per share for the duration of the offering. The Company estimates the costs of this offering at about $35,200. All expenses incurred in this offering are being paid for by the Company. For the duration of the offering any and all sellers of the shares being registered herein agree to provide this prospectus to potential investors in its entirety. The proceeds from the sale of the securities sold on behalf of the Company will be placed directly into the Company s account and or the account of one of its subsidiaries; any investor who purchases shares will have no assurance that any monies, beside their own, will be subscribed to the prospectus. All proceeds from the sale of the securities are non-refundable, except as may be required by applicable laws. We have no plans or intention to merge with an operating company. None of the Company s shareholders or management have plans to enter into any agreement resulting in a change of control of the Company, subsequent to this offering. The Company qualifies as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act, which became law in April 2012 and will be subject to reduced public company reporting requirements. THESE SECURITIES ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK. YOU SHOULD PURCHASE SHARES ONLY IF YOU CAN AFFORD THE COMPLETE LOSS OF YOUR INVESTMENT. PLEASE REFER TO , ' ': RISK FACTORS BEGINNING ON PAGE 4. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. You should rely only on the information contained in this Prospectus and the information we have referred you to. We have not authorized any person to provide you with any information about this Offering, the Company, or the shares of our Common Stock offered hereby that is different from the information included in this Prospectus. If anyone provides you with different information, you should not rely on it. The following table of contents has been designed to help you find important information contained in this prospectus. We encourage you to read the entire prospectus. TABLE OF CONTENTS PART I PROSPECTUS PAGE PROSPECTUS SUMMARY 1 RISK FACTORS 4 SUMMARY OF OUR FINANCIAL INFORMATION 12 MANAGEMENT S DISCUSSION AND ANALYSIS 16 INDUSTRY OVERVIEW 18 FORWARD-LOOKING STATEMENTS 19 DESCRIPTION OF BUSINESS 19 USE OF PROCEEDS 20 DETERMINATION OF OFFERING PRICE 20 DILUTION 21 SELLING SHAREHOLDERS 22 PLAN OF DISTRIBUTION 23 DESCRIPTION OF SECURITIES 24 INTERESTS OF NAMED EXPERTS AND COUNSEL 26 REPORTS TO SECURITIES HOLDERS 26 DESCRIPTION OF FACILITIES 26 LEGAL PROCEEDINGS 27 PATENTS AND TRADEMARKS 27 DIRECTORS AND EXECUTIVE OFFICERS 27 EXECUTIVE COMPENSATION 28 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 30 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 30 PRINCIPAL ACCOUNTING FEES AND SERVICES 30 MATERIAL CHANGES 30 FINANCIAL STATEMENTS F1-F37 PART II. INFORMATION NOT REQUIRED IN PROSPECTUS OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION 31 INDEMNIFICATION OF OFFICERS AND DIRECTORS 31 RECENT SALES OF UNREGISTERED SECURITIES 31 EXHIBITS TO THE REGISTRATION STATEMENT 32 UNDERTAKINGS 33 SIGNATURES 34 You should rely only on the information contained in this prospectus or contained in any free writing prospectus filed with the Securities and Exchange Commission. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus filed with the Securities and Exchange Commission. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are offering to sell, and seeking offers to buy, our common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of shares of our common stock. Our business, financial condition, results of operations and prospects may have changed since that date. Through November 30, 2023 all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. The date of this prospectus is November 30, 2022. Table of Contents PROSPECTUS SUMMARY In this Prospectus, "Jocom Holdings," "the Issuer," the "Company," "we," "us," and "our," refer to Jocom Holdings Corp., unless the context otherwise requires. Unless otherwise indicated, the term ''fiscal year'' refers to our fiscal year ending December 31st. Unless otherwise indicated, the term ''common stock'' refers to shares of the Company's common stock. This Prospectus, and any supplement to this Prospectus include "forward-looking statements". To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as "intends", "anticipates", "believes", "estimates", "projects", "forecasts", "expects", "plans" and "proposes". Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the "Risk Factors" section and the "Management s Discussion and Analysis" section in this Prospectus. This summary only highlights selected information contained in greater detail elsewhere in this Prospectus. This summary may not contain all of the information that you should consider before investing in our common stock. You should carefully read the entire Prospectus, including
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/LITM_snow-lake_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/LITM_snow-lake_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/LITM_snow-lake_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/LOCLW_local_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/LOCLW_local_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/LOCLW_local_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/LTM_latam_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/LTM_latam_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..9a8edaa677486a2813bd8ab042d48f6ff6cbf531
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/LTM_latam_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary The following summary highlights information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider before investing in our securities. This summary must be read together with, and is qualified in its entirety by, the information included in the other sections of this registration statement, in particular the information included in the Risk Factors in this prospectus and other risks described in the 2021 Annual Report, which are incorporated by reference in this prospectus and Cautionary Statement Regarding Forward-Looking Statements sections and our historical consolidated financial statements and the notes to those financial statements before making an investment decision. Business Overview LATAM is the largest passenger airline group in South America as measured by ASKs for the year ended December 31, 2021. We are also one of the largest airline groups in the world in terms of network connections: as of June 30, 2022, providing passenger transport services to 133 destinations in 20 countries and cargo services to approximately 141 destinations in 23 countries, with an operating fleet of 300 aircraft (LATAM s total fleet is 301 aircraft, but one B767 cargo freighter is subleased to a third party) and a set of bilateral alliances. In total, LATAM Airlines Group has approximately 30,600 employees. For the year ended December 31, 2021, LATAM transported approximately 40 million passengers, a decrease from prior years due to the impact of the COVID-19 pandemic on worldwide travel. LATAM Airlines Group S.A. and its affiliates currently provide domestic services in Brazil, Chile, Peru, Colombia and Ecuador (the Group suspended its operations in Argentina in June 2020); and also provide intra-regional and long-haul operations. The cargo affiliate carriers of LATAM in Chile, Brazil, and Colombia carry out cargo operations through the use of belly space on the passenger flights and dedicated cargo operations using freight aircraft. The group also offers other services, such as ground handling, courier, logistics and maintenance. As of June 30, 2022, the group provided scheduled passenger service to 15 destinations in Chile, 19 destinations in Peru, 8 destinations in Ecuador, 17 destinations in Colombia, 50 destinations in Brazil, 10 destinations in other Latin American countries and the Caribbean, 5 destinations in North America, 7 destinations in Europe and 2 destinations in Oceania. In addition, as of June 30, 2022, through various code-sharing agreements, the group offers service to 114 destinations in North America, 27 destinations in South America, 90 destinations in Europe, 18 destinations in Australasia, 46 destinations in Asia and 3 destinations in Africa. The Chapter 11 Reorganization As a result of the COVID-19 pandemic and its profound impact on worldwide travel and our operations, on the Initial Petition Date, the Debtors filed their petitions for relief under Chapter 11 of the Bankruptcy Code with the Bankruptcy Court. On the Subsequent Petition Dates, the Subsequent Debtors filed their petitions for relief under Chapter 11 of the Bankruptcy Code with the Bankruptcy Court. We refer to these proceedings in this prospectus as our Chapter 11 proceedings. LATAM also filed parallel and ancillary proceedings, which are intended to extend the relief provided for by the Bankruptcy Code to various local jurisdictions and help effectuate a global restructuring. On November 26, 2021, the Debtors filed the Plan or Reorganization resulting from the negotiation of the RSA, also dated as of November 26, 2021, with an ad hoc group of general unsecured creditors of LATAM Airlines Group S.A. and certain of the Debtors large equity holders. The Debtors filed the solicitation version of the Plan of Reorganization on March 25, 2022. On June 18, 2022, the Bankruptcy Court entered the Confirmation Order (the Confirmation Order ), which approved and confirmed the Plan of Reorganization. Certain parties in interest have appealed the memorandum decision and order approving entry into the Backstop Agreements, as well as the Confirmation Order. For more information on the Chapter 11 proceedings and our structure following completion of the Chapter 11 process, see The Reorganization. Table of Contents Recent Developments Shareholders meeting On July 5, 2022 the shareholders meeting (as defined below) of the Company passed certain resolutions, as contemplated by the Plan, including resolutions (i) approving the issuance of the New Convertible Notes for a total amount of US$9,493,269,524; (ii) recognizing decreases in the Company s capital stock effective as of June 12, 2018 as a result of shares issued under the existing compensation plan not having been subscribed and paid, and that as a result, the capital stock of the Company was equal to US$3,146,265,152.04, divided into 606,407,693 fully paid-in shares of a single series, no par value; (iii) approving a capital increase of US$10,293,269,524.00 through the issuance of 605,801,285,307 common shares, no par value, including: (a) 531,991,409,513 common shares to back up the issuance of the New Convertible Notes (as defined below, the Back-up Shares ) and (b) 73,809,875,794 common shares to be offered preferentially to the Company s existing shareholders in an US$800 million equity rights offering and subsequently to the shareholders and third parties (the New Common Stock ); (iv) approving changes to the bylaws permitting, among other things, the aforementioned capital increases; and (v) granting the Board of Directors broad powers to implement such resolutions in accordance with the provisions of the Plan. The Equity Rights Offering Pursuant to the terms of the Plan and the Backstop Agreements, the Company offered up to 73,809,875,794 shares of common stock for an aggregate purchase price of US$800 million, which offering was open to all shareholders in accordance with their pre-emptive rights under applicable Chilean law and fully backstopped collectively by the Backstop Creditors and the Backstop Shareholders pursuant to the terms of the Backstop Agreements. New Convertible Notes Offering Pursuant to the terms of the Plan and the Backstop Agreements, LATAM offered three classes of convertible notes (the New Convertible Notes ) for a total amount of approximately US$9,493,270,000, each of which was preemptively offered to shareholders in accordance with their preemptive rights under applicable Chilean law. The offering of the New Convertible Notes closed on . The Convertible Notes are illustratively referred to herein as the New Convertible Notes Class A, the New Convertible Notes Class B and the New Convertible Notes Class C. The New Convertible Notes are Chilean-law governed instruments convertible into common shares of the Company. The New Convertible Notes Class A were offered in a private placement to certain of the Company s general unsecured creditors and represented the primary means of recovery for general unsecured creditors under the Chapter 11 proceedings. The purchase price for the New Convertible Notes Class A was payable exclusively in claims. The New Convertible Notes Class A have a face value of $1.00 per New Convertible Note and were issued in an aggregate amount of up to approximately US$1,257,003,000. The New Convertible Notes Class C have a face value of $1.00 per New Convertible Note and were issued in an aggregate amount of US$6,863,427,289. Fifty percent of the New Convertible Notes Class C were directly allocated to the Backstop Creditors pursuant to the terms of the Creditor Backstop Agreement and the remainder were distributed ratably to general unsecured creditors (including the Backstop Creditors) that subscribed and purchased the New Convertible Notes Class C in a private placement backstopped by the Backstop Creditors. This distribution of New Convertible Notes Class C to the subscribing general unsecured creditors was in exchange for a combination of: (i) US$ of cash consideration and (ii) a settlement (daci n en pago), discharge and release of their general unsecured claims in an amount of $ , in each case, per $1.00 principal amount of New Convertible Note issued and are subject to certain limitations and holdbacks by the Backstop Creditors. In addition, general unsecured creditors electing to receive New Convertible Notes Class A or New Convertible Notes Class C were entitled to receive a one-time cash distribution equal to . Table of Contents The New Convertible Notes Class B were issued in an aggregate amount of approximately $1,372,840,000. The New Convertible Notes Class B were subscribed and purchased for cash in a private placement by the Backstop Shareholders pursuant to the terms of the Shareholder Backstop Agreement. Conversion of New Convertible Notes to Equity The New Convertible Notes mature on December 31, 2121. The New Convertible Notes Class A and the New Convertible Notes Class C bear a 0% interest rate. The New Convertible Notes Class B bear a 1% interest rate. The New Convertible Notes Class A and the New Convertible Notes Class C are convertible into common shares of the Company at a rate of approximately 15.9 and 56.1 shares per convertible note, respectively, in each case subject to a 50% step down in such conversion ratio if not converted within sixty (60) days of the Plan effective date. The New Convertible Notes Class B must be converted by the Backstop Shareholders within sixty (60) days of the Plan effective date. Any New Convertible Notes Class B that are purchased by any non-Backstop Shareholders that have not been converted within sixty (60) days of the Effective Date may not be converted until the fifth (5th) anniversary of the Effective Date. If such New Convertible Notes Class B are still unconverted within sixty (60) days after the fifth (5th) anniversary of the Effective Date, the conversion ratio of such notes steps down by 50%. The Exit Financing The Company has or will incur additional indebtedness consisting of (i) Senior Secured Notes due 2027 with a principal amount of US$700,000,000 (the 2027 Notes ) and (ii) Senior Secured Notes due 2029 with a principal amount of US$450,000,000 (the 2029 Notes , and together with the 2027 Notes, the Senior Notes ), (iii) a Senior Secured Bridge to 5Y Notes credit facility that is expected to be paid in full on the Effective Date (the 5Y Bridge ), (iv) a Senior Secured Bridge to 7Y Notes credit facility that is expected to be paid in full on the Effective Date (the 7Y Bridge and together with the 5Y Bridge, the Bridge Facilities ), (v) a term loan B facility that is expected to have an aggregate principal amount of $1,100,000,000 upon the Effective Date (the Term Loan B Facility ) and (ii) a revolving facility with aggregate commitments of US$500,000,000 (the Revolving Credit Facility and together with the Term Loan B, the Senior Notes and any Bridge Facilities, the Exit Facilities and each an Exit Facility ). Any Exit Facilities not paid in full will become debt financing (the Exit Financing ) that will remain in effect after the Effective Date. The Junior DIP Financing. There is also US$1,145,672,141.67 of debtor-in-possession financing secured on a junior basis to the Exit Facilities (such financing, the Junior DIP Financing ) during the pendency of the Chapter 11 proceedings (prior to the emergence therefrom). In connection with the foregoing, after conducting a competitive process in the market in order to obtain the best financial conditions available for the Junior DIP Financing, on June 10, 2022 the Debtors entered into the Junior DIP Commitment Letter with the Junior DIP Financing Lenders. On June 24, 2022, the Bankruptcy Court entered an order authorizing the Debtors to enter into the commitment letters for the Junior DIP Facility and the Exit Facilities and on September 12, 2022 the Bankruptcy Court entered an agreed amended order authorizing the Debtors to enter into the commitment letters with respect to the Junior DIP Facility and the Exit Facilities. The Junior DIP Financing was funded on October 12, 2022 concurrently with some of the Exit Facilities. New Subordinated Local Notes Issuance In addition, pursuant to the terms of the RSA, the Company issued new UF-denominated Chilean notes, in an amount equivalent to US$130,239.759, in settlement of claims of general unsecured creditors that elect to receive such notes in lieu of the New Convertible Notes Class A or the New Convertible Notes Class C. See New Convertible Notes Offering. The New Subordinated Local Notes accrue interest at 2% per annum and will mature on December 31, 2042. Risks Associated with Our Company Investing in our shares and ADSs involves a significant degree of risk. See Risk Factors beginning on page 11 of this prospectus and the risks described in the 2021 Annual Report which are incorporated by reference herein and other risks described in any applicable prospectus supplement for a discussion of factors you should carefully consider before deciding to invest in our common shares. See Risk Factors. Corporate Information LATAM Airlines Group is a publicly held stock corporation (sociedad an nima abierta) incorporated under the laws of Chile. LATAM Airlines Group was incorporated by a public deed dated December 30, 1983, an abstract of which was published in the Chilean Official Gazette (Diario Oficial de la Rep blica de Chile) No. 31,759 on December 31, 1983, and registered on page 20,341, No. 11,248 of the Chilean Real Estate and Commercial Registrar (Registro de Comercio del Conservador de Bienes Raices de Santiago) for the year 1983. Our corporate purpose, as stated in our by-laws, is to provide a broad range of transportation and related services, as more fully set forth in Article Four thereof. Table of Contents
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+PROSPECTUS SUMMARY The following summary highlights selected information from this prospectus and may not contain all the information that is important to you. To understand our business and this offering fully, you should read this entire prospectus carefully, including the financial statements and the related notes beginning on page F-1. This prospectus contains forward-looking statements and information relating to TipMeFast, Inc. See Cautionary Note Regarding Forward Looking Statements on page 8. Our Company TipMeFast, Inc., (the company) is a Nevada "C" Corporation created to be A lead generation company specializing in Online Network Marketing profession, Our , ' ': Real-Time Leads are for professionals; getting leads for their online or off line services, from cleaning rugs, to online services, selling online and marketing, in the United States. HERE S HOW IT WORKS: With advertising budget, People respond to the professionally landing form page design and host by our websites that match those people with business. We deliver the candidates directly to business, the very moment they respond. You can subscribe to our service for $49.00 a month. Our executive offices are located at HaShmura St. 1, ZihronYa akov, Israel. Our telephone number is (011) (972)3-3730542. Our Company is an "emerging growth company," as defined in the Jumpstart Our Business Startups Act. Our Company shall continue to be deemed an emerging growth company until the earliest of— (A) The last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,070,000) (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers, published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; (B) The last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title (C) The date on which such issuer has, during the previous 3-year period, issued more than $1,000,000 in non-convertible debt; or (D) The date on which such issuer is deemed to be a , ' ': large accelerated filer , as defined in section 240. 12b-2 of title 17, Code of Federal Regulations, or any successor thereto. As an emerging growth company the company is exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on effectiveness of the internal control structure and procedures for financial reporting. As an emerging growth company the company is exempt from Section 14A and B of the Securities Exchange Act of 1934 which require shareholder approval of executive compensation and golden parachutes. Our Company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. The Offering This prospectus covers up to 2,600,000 shares to be issued and sold by the company at a price of $0.005 per share in a direct public offering. ABOUT THIS OFFERING Securities Being Offered Up to 2,600,000 shares of common stock of TipMeFast, Inc. to be sold by the Selling shareholders at a price of $0.005 per share. Initial Offering Price The Selling Shareholders will sell up to 2,600,000 shares at a price of $0.005 per share. Terms of the Offering The Selling Shareholders will offer and sell the shares of its common stock at a price of $0.005 per share in a direct offering to the public. Termination of the Offering The offering will conclude when the company has sold all of the 2,600,000 shares of common stock offered by it up to a maximum of 360 days. Risk Factors An investment in our common stock is highly speculative and involves a high degree of risk. See Risk Factors beginning on page 7. RISK FACTORS An investment in our common stock is highly speculative, involves a high degree of risk, and should be made only by investors who can afford a complete loss. You should carefully consider the following risk factors, together with the other information in this prospectus, including our financial statements and the related notes, before you decide to buy our common stock. If any of the following risks actually occur, our business, financial condition, or results of operations could be materially adversely affected. The trading of our common stock could decline, and you may lose all or part of your investment therein. Risks Relating to the Early Stage of our Company We are at a very early operational stage and our success is subject to the substantial risks inherent in the establishment of a new business venture. The implementation of our business strategy is in a very early stage. Our business and operations should be considered to be in a very early stage and subject to all of the risks inherent in the establishment of a new business venture. Accordingly, our intended business and operations may not prove to be successful in the near future, if at all. Any future success that we might enjoy will depend upon many factors, several of which may be beyond our control, or which cannot be predicted at this time, and which could have a material adverse effect upon our financial condition, business prospects and operations and the value of an investment in our company. We have a very limited operating history and our business plan is unproven and may not be successful. Our company was formed on December 5, 2017 but we have not yet begun full scale operations. We have not proven that our business model will allow us to generate a profit. We have not yet produced an operations product and require additional financing for the production of product and the development of future products. We have suffered operating losses since inception and we may not be able to achieve profitability. It is possible that we will never be able to sustain or develop the revenue levels necessary to attain profitability. We may have difficulty raising additional capital, which could deprive us of necessary resources. We expect to continue to devote significant capital resources to Company research and development. In order to support the initiatives envisioned in our business plan, we will need to raise additional funds through public or private debt or equity financing, collaborative relationships or other arrangements. Our ability to raise additional financing depends on many factors beyond our control, including the state of capital markets, the market price of our common stock and the development or prospects for development of real estate projects. Because our common stock is not listed on a major stock market, many investors may not be willing or allowed to purchase it or may demand steep discounts. Sufficient additional financing may not be available to us or may be available only on terms that would result in further dilution to the current owners of our common stock. We expect to raise additional capital during 2021 but we do not have any firm commitments. If we are unsuccessful in raising additional capital, or the terms of raising such capital are unacceptable, we may have to modify our business plan and/or significantly curtail our planned activities and other operations. There are substantial doubts about our ability to continue as a going concern and if we are unable to continue our business, our shares may have little or no value. The company s ability to become a profitable operating company is dependent upon its ability to generate revenues and/or obtain financing adequate to fulfill its research and market introduction activities, and achieving a level of revenues adequate to support our cost structure has raised substantial doubts about our ability to continue as a going concern. We plan to attempt to raise additional equity capital by selling shares in this offering and, if necessary, through one or more private placement or public offerings. However, the doubts raised, relating to our ability to continue as a going concern, may make our shares an unattractive investment for potential investors. These factors, among others, may make it difficult to raise any additional capital. Because we are currently considered a "shell company" within the meaning of Regulation C 406 pursuant to the Securities Exchange Act of 1933, the ability of holders of our common stock to sell their shares may be limited by applicable regulations As a result of our classification as a "shell company", our investors are not allowed to rely on the "safe harbor" provisions of Rule 144 promulgated pursuant to the Securities Act of 1933 so as not to be considered underwriters in connection with the sale of securities until one year from the date that we cease to be a "shell company." Additionally, as a result of our classification a shell company: Investors should consider shares of our common stock to be significantly risky and illiquid investments. We may not register our securities on Form S-8 (an abbreviated form of registration statement). Our ability to attract additional funding to sustain our operations may be limited significantly. We can provide no assurance or guarantee that we will cease to be a "shell company" and, accordingly, we can provide no assurance or guarantee that there will be a liquid market for our shares. Risks Relating to Our Business The longevity of our business depends in part on our ability to enhance and sell the functionality of our current solutions and technology platform to remain competitive and meet customer needs. The market for apps is relatively new and is characterized by rapid technological obsolescence, frequent new entrants, uncertain product life cycles, fluctuating customer demands, and evolving industry and government energy-related standards and regulations. We may not be able to successfully develop and market new, reliable, solutions that comply with present or emerging demands, regulations and standards on a cost-effective basis. The development of new equipment and software requires significant research, development, testing cycles and investment, and there is no guarantee that the software we have developed or will ultimately develop will outpace that of our competitors. We may not be able to successfully deploy our solutions in a timely manner. Our growth will largely depend on our ability to successfully deploy our solutions across a large portfolio of customer facilities and an expanded geography that may require international deployment. Our ability to successfully deploy our equipment depends on many factors, including, among others, our ability to: properly staff, incentivize and mobilize personnel and subcontractors, including our installation and technology specialists; obtain upfront payment from our customers and additional financing to cover our inventory and other internal costs; expand and improve our technology. Our proprietary rights could potentially conflict with the rights of others and we may be prevented from selling some of our products. Third parties may assert intellectual property claims against us, particularly as we expand our business and the number of products we offer. Our defense of any claim, regardless of its merit, could be expensive and time consuming and could divert management resources. Successful infringement claims against us could result in significant monetary liability or prevent us from selling some of our products. In addition, resolution of claims may require us to redesign our products, license rights from third parties or cease using those rights altogether. Because management does not have relevant experience in managing a software and electronic products company, our business has a higher risk of failure. Our sole officer and director Mr Chalil, does not reside in the United States and has limited business experience related to the marketing and development of our business. Consequently, management will initially have to rely on the experience of third parties. Further, we have budgeted only $10,000 toward operational expenses Additionally, our lack of public company experience could impair our ability to comply with legal and regulatory requirements such as those imposed by the Sarbanes-Oxley Act of 2002. Our management has never been responsible for managing a publicly traded company. Such responsibilities include complying with federal securities laws and making required disclosures on a timely basis. Our management may not be able to implement programs and policies in an effective and timely manner that adequately responds to such increased legal, regulatory compliance and reporting requirements including establishing and maintaining internal controls over financials reporting. Any such deficiencies, weaknesses or lack of compliance could have a materially adverse effect on our ability to comply with the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act") which is necessary to maintain our public company status. If we were to fail to fulfill those obligations, our ability to continue as a U.S. public company would be in jeopardy in which event you could lose your entire investment. over the next 12 months, which by industry standards is a very limited amount of capital with which to launch our effort. Given the relatively small marketing budget and limited experience of our officers, there can be no assurance that such efforts will be successful. Further, if our initial efforts to create a market for our website are not successful, there can be no assurance that we will be able to attract and retain qualified individuals with marketing and sales expertise to attract subscribers to our website. Our future success will depend, amount other factors, upon whether our services can be sold at a profitable price and the extent to which consumers acquire, adopt, and continue to use them. There can be no assurance that our application will gain wide acceptance in its targeted markets or that we will be able to effectively market our services. There can be no assurance that they will be successful in obtaining adequate assistance or cooperation from third parties at a cost consistent with the resources of the Company. We have commenced only limited operations, and therefore currently have no employees other than our officers/directors, who each spend approximately 15 to 20 hours a week on our business as is required. Mr. Chalil is engaged with other businesses which will occupy the remainder of his working time every week. Mr Chalil does not anticipate providing less than 6 hours per week of service in order to perform basic corporate maintenance and book keeping. We will consider retaining full-time management and administrative support personnel as our business and operations increase. We do not foresee engaging full-time management or administrative support personnel during the next 12 months. Foreign Officers and Directors could result in difficulty enforcing rights. The officer and director of the Company are located in Isreal and as such investors may have difficulty in enforcing their legal rights under the United States securities laws. Risks Relating to our Stock The Offering price of $0.005 per share is arbitrary. The Offering price of $0.005 per share has been arbitrarily determined by our management and does not bear any relationship to the assets, net worth or projected earnings of the Company, or any other generally accepted criteria of value. We have no firm commitments to purchase any shares. We have no firm commitment for the purchase of any shares. Therefore there is no assurance that a trading market will develop or be sustained. The Company has not engaged a placement agent or broker for the sale of the shares. The Company may be unable to identify investors to purchase the shares and may have inadequate capital to support its ongoing business obligations. Our shares are not currently traded on any market or exchange. We will apply to have our common stock traded over the counter; there is no guarantee that our shares will ever be quoted on the OTC PINKSHEETS listed on an exchange, which could severely impact their liquidity. Currently our shares are not traded on any market or exchange. We will apply to have our common stock quoted via the OTC PINKSHEETS. Therefore, our common stock is expected to have fewer market makers, lower trading volumes and larger spreads between bid and asked prices than securities listed on an exchange such as the New York Stock Exchange or the NASDAQ Stock Market. These factors may result in higher price volatility and less market liquidity for the common stock. It is possible that the company s shares may never be quoted on the OTC PINKSHEETS listed on an exchange. A low market price would severely limit the potential market for our common stock. Our common stock is expected to trade at a price substantially below $5.00 per share, subjecting trading in the stock to certain SEC rules requiring additional disclosures by broker-dealers. These rules generally apply to any non-NASDAQ equity security that has a market price share of less than $5.00 per share, subject to certain exceptions (a "penny stock"). Such rules require the delivery, prior to any penny stock transaction, of a disclosure schedule explaining the penny stock market and the risks associated therewith and impose various sales practice requirements on broker-dealers who sell penny stocks to persons other than established customers and institutional or wealthy investors. For these types of transactions, the broker-dealer must make a special suitability determination for the purchaser and have received the purchaser s written consent to the transaction prior to the sale. The broker-dealer also must disclose the commissions payable to the broker-dealer, current bid and offer quotations for the penny stock and, if the broker-dealer is the sole market maker, the broker-dealer must disclose this fact and the broker-dealer s presumed control over the market. Such information must be provided to the customer orally or in writing before or with the written confirmation of trade sent to the customer. Monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. The additional burdens imposed upon broker-dealers by such requirements could discourage broker-dealers from effecting transactions in our common stock. FINRA sales practice requirements may also limit a stockholders ability to buy and sell our stock. In addition to the penny stock rules promulgated by the SEC, which are discussed in the immediately preceding risk factor, FINRA rules require that in recommending an investment to a customer, a broker -dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative, low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit the ability to buy and sell our stock and have an adverse effect on the market value for our shares. An investor s ability to trade our common stock may be limited by trading volume. A consistently active trading market for our common stock may not occur on the OTC PINKSHEETS. A limited trading volume may prevent our shareholders from selling shares at such times or in such amounts as they may otherwise desire. The company s shares may never be quoted on the OTC PINKSHEETS listed on an exchange. Our company has a concentration of stock ownership and control, which may have the effect of delaying, preventing, or deterring a change of control. Our common stock ownership is highly concentrated. Through ownership of shares of our common stock, one shareholder, our officer beneficially owns 100% of our total outstanding shares of common stock before this offering. As a result of the concentrated ownership of the stock, these stockholders, acting in concert, will be able to control all matters requiring stockholder approval, including the election of directors and approval of mergers and other significant corporate transactions. This concentration of ownership may have the effect of delaying, preventing or deterring a change in control of our company. It could also deprive our stockholders of an opportunity to receive a premium for their shares as part of a sale of our company and it may affect the market price of our common stock. We have not voluntarily implemented various corporate governance measures, in the absence of which, shareholders may have more limited protections against interested director transactions, conflicts of interest and similar matters. Recent federal legislation, including the Sarbanes-Oxley Act of 2002, has resulted in the adoption of various corporate governance measures designed to promote the integrity of the corporate management and the securities markets. Some of these measures have been adopted in response to legal requirements; others have been adopted by companies in response to the requirements of national securities exchanges, such as the NYSE or the NASDAQ Stock Market, on which their securities are listed. Among the corporate governance measures that are required under the rules of national securities exchanges and NASDAQ, are those that address the board of Directors independence, audit committee oversight, and the adoption of a code of ethics. While our Board of Directors has adopted a Code of Ethics and Business Conduct, we have not yet adopted any of these corporate governance measures, and since our securities are not listed on a national securities exchange or NASDAQ, we are not required to do so. It is possible that if we were to adopt some or all of these corporate governance measures, shareholders would benefit from somewhat greater assurances that internal corporate decisions were being made by disinterested directors and that policies had been implemented to define responsible conduct. For example, in the absence of audit, nominating and compensation committees comprised of at least a majority of independent directors, decisions concerning matters such as compensation packages to our senior officers and recommendations for director nominees, may be made by a majority of directors who have an interest in the outcome of the matters being decided. Prospective investors should bear in mind our current lack of corporate governance measures in formulating their investment decisions. Because we will not pay dividends in the foreseeable future, stockholders will only benefit from owning common stock if it appreciates. We have never paid dividends on our common stock and we do not intend to do so in the foreseeable future. We intend to retain any future earnings to finance our growth. Accordingly, any potential investor who anticipates the need for current dividends from his investment should not purchase our common stock. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting the financial condition of our business. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including, among other things: Factors that might cause these differences include the following: the ability of the company to offer and sell the shares of common stock offered hereby; the integration of multiple technologies and programs; the ability to successfully complete development and commercialization of sites and our company s expectations regarding market growth; changes in existing and potential relationships with collaborative partners; the ability to retain certain members of management; our expectations regarding general and administrative expenses; our expectations regarding cash balances, capital requirements, anticipated revenue and expenses, including infrastructure expenses; and other factors detailed from time to time in filings with the SEC. In addition, in this prospectus, we use words such as "anticipate," "believe," "plan," "expect," "future," "intend," and similar expressions to identify forward-looking statements. We undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this prospectus. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this prospectus may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. USE OF PROCEEDS The Company will receive no proceeds from the sale of shares under this offering. CAPITALIZATION The following table sets forth our capitalization as of March 31, 2021: March 31, 2021 ASSETS Current assets Cash held in trust $16,580 Total Current Assets 16,580 Total Assets $16,580 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $2,000 Accrued expenses 1,500 Total current liabilities 3,500 Total Liabilities $3,500 DILUTION There is no dilution as a result of this offering. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Our common stock is not currently traded on any exchange. We cannot assure that any market for the shares will develop or be sustained. We have not paid any dividends on our common stock and do not anticipate paying cash dividends in the foreseeable future. We intend to retain any earnings to finance the growth of our business. We cannot assure you that we will ever pay cash dividends. Whether we pay cash dividends in the future will be at the discretion of our Board of Directors and will depend upon our financial condition, results of operations, capital requirements and any other factors that the Board of Directors decides are relevant. See Management s Discussion and Analysis of Financial Condition and Results of Operations. As of January 30, 2020, the Company has thirty (30) shareholders who holds 100% of its issued and outstanding common stock. DESCRIPTION OF BUSINESS AND PROPERTY Our Company The Company was formed on December 5, 2017 in the State of Nevada as a "C" corporation.. Business Strategy TipMeFast, Inc., (the company) is a Nevada "C" Corporation created to be A lead generation company specializing in Online Network Marketing profession, Our , ' ': Real-Time Leads are for professionals; getting leads for their online or off line services, from cleaning rugs, to online services, selling online and marketing, in the United States. HERE S HOW IT WORKS: With advertising budget, People respond to the professionally landing form page design and host by our websites that match those people with business. We deliver the candidates directly to business, the very moment they respond. Real-Time Leads go directly to the company, First, they answered basic questions and have given us their name, phone number, email, and their physical address. Then, they have gone on to further answer a detailed list of specific questions that includes baguette and a text area where they enter their own comments. These leads are then emailed directly to the company contactor the very moment your prospect presses the , ' ': Submit button on your landing page. This gives the incredible advantage of a real person available to help get them started! TipMeFast give a better way to successfully build your business than to focus on contacting prospects who have stepped up and already identified themselves as being interested? This makes our system ideal, not only for you also for new prospect becomes enrolled after coming. we call them, ' ': PRE-QUALIFIED PROSPECTS , How it works: 1. The Landing Page - Form Surveyed Leads ARE GENERATED After the prospect fills out the first form, then Part 2 opens up and they fill out more specific information. by prospects providing the answers to your list of survey questions, you will gain tremendous insight who they are, and how to effectively communicate with each of them. These leads are generated in real-time and are sent to you at the very moment the prospect hits the , ' ': Submit button. Our executive offices are located at HaShmura St. 1, ZihronYa akov, Israel. Our telephone number is (011) (972)3-3730542. Marketing The Company will begin its marketing program online where our potential customers are most probably able and willing to associate. Our business model and strategy are still evolving and are continually being reviewed and revised; Below is a brief description of our planned activities which we expect to commence immediately after the Offering is completed and the proceeds have been received and accepted assuming that we were able to sell all 2,600,000 shares of our common stock. Months 1 to 6 Following Completion of this Offering Main Objectives: Hire a freelancer graphic designer; Identify and hire a freelance software developer to develop our system; Initiate the graphic design of our corporate identity package (logos, layouts, fonts etc.); and Set up Google AdSense account. Upon the sale of 2,600,000 shares we will immediately begin to interview one or more software developer companies and freelancer graphic designers in Israel, we have yet to identify potential candidates. We plan to retain the services of the software developer and freelance graphic designer by the end of the first month. During month 2, we will work with the software developer on the specifications of the website. During months 3 and 4 we expect the software developer to develop and integrate it with our website. During month 5 we will test the system and correct any issues with it. We have budgeted $5,000 for the contractor, which we believe will be sufficient to develop and integrate the management system with our website. Our management intends to oversee and participate in the software development process. During month 2 the freelance graphic designer will design our corporate identity package and marketing materials. We expect that our graphic designer will complete developing our corporate identity package (including logos, business cards, letterhead, stationary, email forms, etc.) by the end of month 3 at a cost of $1,250. Once completed, we intend for the designer to proceed with the revamping of our web site at a cost of $1,250. This task will be completed by the end of month 4. We expect to concurrently proceed with the printing of business cards, letterhead and envelopes at an anticipated cost of $700. During month 5, we plan to set up an account with Google Adsense service. This is available free of charge to us and will allow us to include Google ads from other advertisers on our website. We will receive a fee from these advertisers for each click on their ad by our subscriber visiting our site. MILESTONES Below is a brief description of our planned activities, which we expect to commence immediately after the offering is completed and the proceeds have been received and accepted. Requirements and UX Design Our management team will work with a third-party Web development company to gather the requirements and agree on the UX (User Experience) options. Once the UX design was defined, it will be developed into a UI (User Interface) design. Once the UX & UI are complete, it will be passed on to the development team. Outcome of this phase will be a complete design for the iPhone Application. We expect that this period will require an expenditure of approximately $5000. Months 4 to 6 During the following three months, we plan to achieve the following: A third-party Web development company will build the administrative web portal using .Net technology require an expenditure of approximately $10,000. Months 7 to 12 During the following six months, we plan to achieve the following: App Store Submission: The software developer will facilitate the App Store submission process and manage approval issues. Once submitted Apple will review the application to ensure the application is reliable and is free of explicit and offensive material. We expect to be completed by the end of month 8 after defects have been fixed. Once submitted to the App Store we expect the review process to take 3-4 weeks. Advertising With limited funds, The Company will rely on management for advertising decisions. The company has developed an overall advertising scenario which it has implemented in preliminary form. As more funds become available the advertising budget will increase in a commensurate fashion. Employees As of December 31, 2021, we had one (1) part time employee, including management. We consider our relations with our employees to be good . Description of Property We currently lease office space at HaShmura St. 1, ZihronYa akov, Isreal, as our principal offices. We believe these facilities are in good condition, but that we may need to expand our leased space as our research and development efforts increase. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion of our financial condition and results of operations should be read in conjunction with (i) our audited financial statement as of December 31 2020, that appear elsewhere in this registration statement. This registration statement contains certain forward-looking statements and our future operating results could differ materially from those discussed herein. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We disclaim any obligation to update any such factors or to announce publicly the results of any revisions of the forward -looking statements contained herein to reflect future events or developments. For information regarding risk factors that could have a material adverse effect on our business, refer to the Risk Factors section of this prospectus beginning on page 6. Going Concern The future of our company is dependent upon its ability to obtain financing and upon future profitable operations from the sale of products and services through our websites. Management has plans to seek additional capital through a private placement and public offering of its common stock, if necessary. Our auditors have expressed a going concern opinion which raises substantial doubts about the Issuers ability to continue as a going concern. Plan of Operation Liquidity and Capital Resources We have no material commitments for the next twelve months. We will however require additional capital to meet our liquidity needs. Currently, the Company has determined that its anticipated monthly cash flow needs should not exceed of $6,000 per month for the first 6 months of 2021. Expenses are expected to increase marginally in the second half of 2021. We anticipate that we will receive sufficient proceeds from investors through this offering, to continue operations for at least the next twelve months; however, there is no assurance that such proceeds will be received and there are no agreements or understandings currently in effect from any potential investors. It is anticipated that the company will receive increasing revenues from operations in the coming year, however, since the Company has earned only nominal revenues to date, it is difficult to anticipate what those revenues might be, if any, and therefore, management has assumed for planning purposes only that it may need to sell common stock, take loans or advances from officers, directors or shareholders or enter into debt financing agreements in order to meet our cash needs over the coming twelve months. The Issuer has no agreements or understandings for any of the above-listed financing options. The Use of Proceeds section includes a detailed description of the use of proceeds over the differing offering scenarios of 100%, 75%, 50% and 25%. As the Company s expenses are relatively stable, unless additional sites are rolled out, the Company believes it can continue its present operations with projected revenues together with offering proceeds under any of the offering scenarios. The Company will consider raising additional funds through sales of equity, debt and convertible securities, if it is deemed necessary. The Company has no intention in investing in short-term or long-term discretionary financial programs of any kind. Results of Operations We have not generated any revenue since inception on December 5, 2020. Our independent registered public accounting firm has expressed a going concern opinion which raises substantial doubts about our ability to continue as a going concern. . Due to the limited nature of the Company s operations to date, the Company does not believe that past performance is any indication of future performance. The impact on the Company s revenue s of recognized trends and uncertainties in our market will not be recognized until such time as the Company has had sufficient operations to provide a baseline. Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. Critical Accounting Policies Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. In general, management s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management. Equipment, Furniture and Leasehold Improvements. Equipment, furniture and leasehold improvements are recorded at cost and depreciated on a straight-line basis over the lesser of their estimated useful lives, ranging from three to seven years, or the life of the lease, as appropriate. Impairment of Long-Lived Assets. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows expected to be generated by such assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the discounted expected future net cash flows from the assets. Revenue Recognition. The Company recognizes revenue when all four of the following criteria are met: (i) persuasive evidence that an arrangement exists; (ii) delivery of the products and/or services has occurred; (iii) the fees earned can be readily determined; and (iv) collectability of the fees is reasonably assured. Loss Per Common Share. Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. As of December 31, 2020, there were no share equivalents outstanding. OUR MANAGEMENT Executive Officers Name Age Position Raid Chalil 52 Pres, Sec, Treas, Dir, CEO, CFO Directors, Executive Officers, Promoters and Control Persons Raid Chalil, President/Director Mr. Raid Chalil has served as President and Director since inception on December 5, 2020. Mr. Raid has not been employed since December of 2016, when he left his job after 15 years as a manager in Bank Hapoalim Haifa, in Isreal, to start a business planning and preparing software applications for mobile telephones. In 2016, Mr. Raid obtained a Certificate of Computer Technician from the Ministry of Labor in Israel. Mr. Raid desire to found our company and his background as a banker and a computer technician led to our conclusion that Mr. Raid should be serving as a member of our board of directors in light of our business and structure. Executive Compensation Summary Compensation Table. There is no compensation paid to any employees at the present time. Employees will receive compensation after the company has achieved positive cash flow. Outstanding Equity Awards at Fiscal Year End. There were no outstanding equity awards as of December 31, 2021. Compensation of Non-Employee Directors. We currently have no non-employee directors and no compensation was paid to non-employee directors in the period ended December 31, 2020. We intend to identify qualified candidates to serve on the Board of Directors and to develop a compensation package to offer to members of the Board of Directors and its Committees. Audit, Compensation and Nominating Committees. As noted above, we intend to apply for listing our common stock on the OTC PINKSHEETS, which does not require companies to maintain audit, compensation or nominating committees. The company s shares may never be quoted on the OTC PINKSHEETS listed on an exchange. Considering the fact that we are an early stage company, we do not maintain standing audit, compensation or nominating committees. The functions typically associated with these committees are performed by the entire Board of Directors which currently consists of one member who is not considered independent. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Security Ownership of Principal Stockholders, Directors, Nominees and Executive Officers and Related Stockholder Matters The following table sets forth, as of December 31, 2020, certain information with respect to the beneficial ownership of shares of our common stock by: (i) each person known to us to be the beneficial owner of more than five percent (5%) of our outstanding shares of common stock, (ii) each director or nominee for director of our Company, (iii) each of the executives, and (iv) our directors and executive officers as a group. Unless otherwise indicated, the address of each shareholder is c/o our company at our principal office address: Beneficial Owner Address Number of Shares Owned Percent of Class Raid Chalil HaShmura St. 1, ZihronYa akov, Israel 3,000,000 54 % (*) Beneficial ownership is determined in accordance with the rules of the SEC which generally attribute beneficial ownership of securities to persons who possess sole or shared voting power and/or investment power with respect to those securities. Unless otherwise indicated, voting and investment power are exercised solely by the person named above or shared with members of such person s household. This includes any shares such person has the right to acquire within 60 days. (**) Percent of class is calculated on the basis of the number of fully diluted shares outstanding on December 31, 2019 (5,600,000). CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS It is our practice and policy to comply with all applicable laws, rules and regulations regarding related person transactions, including the Sarbanes-Oxley Act of 2002. A related person is an executive officer, director or more than 5% stockholder of TipMeFast, Inc. ., including any immediate family members, and any entity owned or controlled by such persons. Our Board of Directors (excluding any interested director) is charged with reviewing and approving all related-person transactions, and a special committee of our Board of Directors is established to negotiate the terms of such transactions. In considering related-person transactions, our Board of Directors takes into account all relevant available facts and circumstances. Director Independence Our Board of Directors has adopted the definition of "independence" as described under the Sarbanes Oxley Act of 2002 (Sarbanes-Oxley) Section 301, Rule 10A-3 under the Securities Exchange Act of 1934 (the Exchange Act) and NASDAQ Rules 4200 and 4350. Our Board of Directors has determined that its member does not meet the independence requirements. DESCRIPTION OF CAPITAL STOCK Authorized and Issued Stock Number of Shares at December 31, 2019 Title of Class Authorized Outstanding Common stock, $0.001 par value per share 75,000,000 5,600,000 Common stock Dividends. Each share of common stock is entitled to receive an equal dividend, if one is declared, which is unlikely. We have never paid dividends on our common stock and do not intend to do so in the foreseeable future. We intend to retain any future earnings
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+PROSPECTUS SUMMARY 1
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+S-1/A 1 neov_s1a.htm REGISTRATION STATEMENT Registration Statement As filed with the Securities and Exchange Commission on July 11, 2022. Registration No. 333-264275 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 (Amendment No. 8) REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 NEOVOLTA, INC. (Exact name of registrant as specified in its charter) Nevada 3690 82-5299263 (State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer incorporation or organization) Classification Code Number) Identification Number) 13651 Danielson Street, Suite A Poway, CA 92064 (800) 364-5464 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Brent Willson Chief Executive Officer NeoVolta, Inc. 13651 Danielson Street, Suite A Poway, CA 92064 (800) 364-5464 (Name, address, including zip code, and telephone number, including area code, of agent for service) With copies to: Cavas Pavri, Esq. ArentFox Schiff LLP 1717 K Street, NW Washington, DC 20006 Telephone: (202) 724-6847 Fax: (202) 778-6460 Barry Grossman, Esq. Sarah Williams, Esq. Matthew Bernstein, Esq. Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas New York, New York 10105 Telephone: (212) 370-1300 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement is declared effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to Section 8(a), may determine. The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JULY 11, 2022 PRELIMINARY PROSPECTUS 1,125,000 Units Each Unit Consisting of One Share of Common Stock and One Warrant to Purchase One Share of Common Stock This is an initial public offering of units of our securities at a public offering price of $4.00 per unit. Each Unit consists of one share of our common stock and one warrant (each, a Warrant and collectively, the Warrants ) to purchase one share of common stock at an exercise price of $4.00 per share. The Units have no stand-alone rights and will not be certificated or issued as stand-alone securities. The shares of common stock and the Warrants comprising the Units are immediately separable and will be issued separately in this offering. Each Warrant offered hereby is immediately exercisable on the date of issuance and will expire five years from the date of issuance. Prior to this offering, our common stock was quoted on the OTCQB Marketplace (the OTCQB ) under the symbol NEOV. There is no established trading market for the Warrants. We have applied for listing of our common stock and Warrants on the NASDAQ Capital Market ( Nasdaq ) under the symbols NEOV and NEOVW, respectively. We believe that upon the completion of the offering contemplated by this prospectus, we will meet the standards for listing on Nasdaq. We cannot guarantee that we will be successful in listing our common stock or our Warrants on Nasdaq; however, we will not complete this offering unless we are so listed. There is no assurance that our common stock will be approved for listing on Nasdaq. If our common stock is not approved for listing the offering will not proceed. The last reported sale price for our common stock as reported on the OTCQB on July 8, 2022 was $3.49. The offering price of the Units has been determined by negotiations between the underwriters and us considering our historical performance and capital structure, prevailing market conditions, and overall assessment of our business, and may be at a discount to the current market price. The prices at which our common stock was quoted on the OTCQB may not be indicative of the actual public offering price for our Units or of the prices at which our common stock may trade on Nasdaq in the future. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 10 of this prospectus for a discussion of information that you should consider before investing in our securities. We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, and we have elected to comply with certain reduced public company reporting requirements. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Price to the public $ $ Underwriting discounts and commissions (1) $ $ Proceeds to us (before expenses) (2) $ $ (1)We have also agreed to issue warrants to purchase shares of our common stock to the underwriter and to reimburse the underwriter for certain expenses. The underwriter s warrants are exercisable for a number of shares of common stock equal to 6.0% of the number of Units sold in this offering, at an exercise price equal to 110% of the public offering price per Unit. See Underwriting for additional information regarding total underwriter compensation. (2)The amount of offering proceeds to us presented in this table does not give effect to any exercise of the: (i) over-allotment option (if any) we have granted to the underwriter as described below and (ii) warrants being issued to the underwriter in this offering. We have granted a 45-day option to the underwriter to purchase up to an additional 168,750 shares of common stock and/or 168,750 additional Warrants solely to cover overallotments, if any, at the public offering price, less underwriting discounts and commissions. If the representative of the underwriters exercises the option in full, the total underwriting discounts and commissions payable will be $_____ and the total proceeds to us, before expenses, will be $_____. The underwriter expects to deliver the securities against payment to the investors in this offering made on or about _________ , 2022. Sole Book-Running Manager Maxim Group LLC The date of this prospectus is _______________ , 2022. TABLE OF CONTENTS PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere or incorporated by reference into this prospectus. It may not contain all the information that may be important to you. You should read this entire prospectus, including all documents incorporated by reference, carefully, especially the Risk Factors section beginning on page 3 of this prospectus and incorporated by reference from our Annual Report on Form 10-K for the year ended December 31, 2021 and any subsequently filed Quarterly Reports on Form 10-Q, and our financial statements and related notes incorporated by reference in this prospectus before making an investment decision with respect to our securities. Please see the sections titled Where You Can Find More Information and Incorporation of Certain Information by Reference in this prospectus. Our Company We were incorporated in Delaware on May 21, 2014, and were formed for the purpose of acquiring, through a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization, or other similar business combination, one or more businesses or entities. On July 24, 2017, one of our subsidiaries merged with and into NextDecade LLC, an LNG development company founded in 2010 to develop LNG export projects and associated pipelines. Prior to the merger with NextDecade LLC, we had no operations and our assets consisted of cash proceeds received in connection with our initial public offering. Our common stock trades on the Nasdaq Capital Market under the symbol NEXT. We believe that natural gas in the form of LNG will play an important role in the energy transition, but its contribution to global greenhouse gas emissions must be reduced to an absolute minimum. Through our subsidiary, Rio Grande LNG, LLC, we are developing the Terminal, and we seek to minimize its associated emissions footprint by developing a CCS project at the Terminal, combined with using responsibly sourced natural gas and our pledge to use net-zero electricity. We also believe reducing CO2 emissions from industrial facilities around the world is critical to realizing the Paris Agreement s goal of limiting global warming compared to pre-industrial levels. We believe carbon capture and storage equipment and technology must be extensively implemented to achieve this goal, and through our subsidiary, NEXT Carbon Solutions, we seek to deploy the proprietary carbon capture and storage processes that we have developed at industrial source facilities to reduce CO2 emission levels. Our management is comprised of a team of industry leaders with extensive experience in the development of major projects. We have continued to focus our development activities on the Terminal and to undertake various initiatives to evaluate, design, and engineer the Terminal that we expect will result in demand for LNG supply, which would enable us to seek construction financing to develop the Terminal and have expanded into developing CCS projects through NEXT Carbon Solutions. Corporate Information The mailing address of our principal executive office is 1000 Louisiana Street, Suite 3900, Houston, Texas 77002 and our telephone number is (713) 574-1880. We maintain a website at www.next-decade.com. The information contained on our website is not intended to form a part of, or be incorporated by reference into, this prospectus. For a description of our business, financial condition, results of operations and other important information regarding us, we refer you to our filings with the SEC incorporated by reference into this prospectus. For instructions on how to find copies of these documents, see Where You Can Find More Information. Table of Contents The information in this prospectus is not complete and may be changed. The selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED SEPTEMBER 30, 2022 Prospectus NextDecade Corporation 15,454,160 shares of Common Stock for Sale by the Selling Stockholders This prospectus relates to the offer and sale from time to time by the selling stockholders identified in this prospectus or a supplement hereto of 15,454,160 shares of common stock, par value $0.0001 per share (the Common Stock ), of NextDecade Corporation (the Company ). The shares of Common Stock covered by this prospectus were issued in a private placement transaction in which we sold shares to the selling stockholders in September 2022 (the Private Placement ). We are registering the offer and sale of the shares of Common Stock to satisfy registration rights we have granted to the selling stockholders. We have agreed to bear all of the expenses incurred in connection with the registration of the sale of shares of Common Stock covered by this prospectus other than those expenses related to transfer taxes, underwriting or brokerage commissions or discounts associated with the sale of shares of Common Stock pursuant to this prospectus. We are not selling any shares of Common Stock under this prospectus and will not receive any proceeds from the sale of shares of Common Stock by the selling stockholders. The shares of Common Stock to which this prospectus relates may be offered and sold from time to time directly by the selling stockholders or alternatively through underwriters, broker-dealers or agents. The selling stockholders will determine at what price they may sell the shares of Common Stock offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices. For additional information on the methods of sale that may be used by the selling stockholders, see the section titled Plan of Distribution. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should carefully read this prospectus and any prospectus supplement or amendment before you invest. You also should read the documents we have referred you to under the headings Where You Can Find More Information and Incorporation of Certain Information by Reference of this prospectus for information about us and our financial statements. The Common Stock is listed on the Nasdaq Capital Market under the symbol NEXT. On September 29, 2022, the last reported sale price of the Common Stock on the Nasdaq Capital Market was $6.19 per share. Investing in shares of our Common Stock involves risks. See the section entitled Risk Factors beginning on page 3 of this prospectus. You should carefully read and consider these risk factors before you invest in shares of our Common Stock. Table of Contents ABOUT THIS PROSPECTUS This prospectus is part of a registration statement that we filed with the SEC using a shelf registration process. Under this shelf registration process, the selling stockholders may, from time to time, offer and sell the shares of Common Stock described in this prospectus in one or more offerings. In addition, a prospectus supplement may also add, update or change the information contained or incorporated in this prospectus. Any prospectus supplement will supersede this prospectus to the extent it contains information that is different from, or that conflicts with, the information contained or incorporated in this prospectus. The registration statement we filed with the SEC includes exhibits that provide more detail of the matters discussed in this prospectus. You should read and consider all information contained in this prospectus and the related registration statement and exhibits filed with the SEC and any accompanying prospectus supplement in making your investment decision. You should also read and consider the information contained in the documents identified under the headings Where You Can Find More Information and Incorporation of Certain Information by Reference in this prospectus. WHERE YOU CAN FIND MORE INFORMATION The registration statement that we have filed with the SEC registers the securities offered by this prospectus under the Securities Act. The registration statement, including the exhibits to it, contains additional relevant information about us. The rules and regulations of the SEC allow us to omit some information included in the registration statement from this prospectus. The Company files reports, proxy statements and other information with the SEC as required by the Securities Exchange Act of 1934, as amended (the Exchange Act ). You can read the Company s filings with the SEC, including this prospectus, over the internet at the SEC s website at http://www.sec.gov. We also make available free of charge on the Investors section of our website, http://www.next-decade.com, all materials that we file electronically with the SEC, including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Section 16 reports and amendments to those reports as soon as reasonably practicable after such materials are electronically filed with, or furnished to, the SEC. Information contained on our website or any other website is not incorporated by reference into, and does not constitute a part of, this prospectus. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus and any accompanying prospectus supplement and the documents incorporated herein or therein by reference contains certain statements that are, or may be deemed to be, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act ), and Section 21E of the Exchange Act. All statements other than statements of historical fact contained in this prospectus, including statements regarding our future results of operations and financial position, strategy and plans, and our expectations for future operations and economic performance, are forward-looking statements. The words anticipate, contemplate, estimate, expect, project, plan, intend, believe, seek, may, might, will, would, could, should, can have, likely, continue, design assume, budget, forecast and other words and terms of similar expressions, are intended to identify forward-looking statements. We have based these forward-looking statements on assumptions and analysis made by us in light of our current expectations, perceptions of historical trends, current conditions and projections about future events and trends that we believe may affect our financial condition, results of operations, strategy, short-term and long-term business operations and objectives and financial needs. Although we believe that the expectations reflected in our forward-looking statements are reasonable, actual results could differ from those expressed in our forward-looking statements. Our future financial position and results of operations, as well as any forward-looking statements are subject to change and inherent risks and uncertainties, including those described in the section titled Risk Factors herein and in our most recent Annual Report on Form 10-K and any subsequently filed Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. You should consider our forward-looking statements in light of a number of factors that may cause actual results to vary from our forward-looking statements including, but not limited to: our progress in the development of our liquefied natural gas ( LNG ) liquefaction and export project and any carbon capture and storage projects ( CCS projects ) we may develop and the timing of that progress; the timing of achieving a final investment decision ( FID ) in the construction and operation of a 27 million tonne per annum LNG export facility at the Port of Brownsville in southern Texas (the Terminal ); our reliance on third-party contractors to successfully complete the Terminal, the pipeline to supply gas to the Terminal and any CCS projects we develop; our ability to develop our NEXT Carbon Solutions, LLC ( NEXT Carbon Solutions ) business through implementation of our CCS projects; our ability to secure additional debt and equity financing in the future to complete the Terminal and other CCS projects on commercially acceptable terms and to continue as a going concern; the accuracy of estimated costs for the Terminal and CCS projects; our ability to achieve operational characteristics of the Terminal and CCS projects, when completed, including amounts of liquefaction capacities and amount of CO2 captured and stored, and any differences in such operational characteristics from our expectations; the development risks, operational hazards and regulatory approvals applicable to our LNG and carbon capture and storage development, construction and operation activities and those of our third-party contractors and counterparties; technological innovation which may lessen our anticipated competitive advantage or demand for our offerings; the global demand for and price of LNG; the availability of LNG vessels worldwide; Table of Contents THE OFFERING Common Stock offered by the selling stockholders Up to 15,454,160 shares of Common Stock. Use of proceeds We are not selling any shares of Common Stock under this prospectus and will not receive any of the proceeds from the sale of shares of Common Stock by the selling stockholders.
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+PROSPECTUS SUMMARY 4
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+As filed with the Securities and Exchange Commission on November 3, 2022 Registration No. 333-266757 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 4 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 OPAL FUELS INC. (Exact name of registrant as specified in its charter) Delaware 4932 98-1578357 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) One North Lexington Avenue Suite 1450 White Plains, New York 10601 (914) 705-4000 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Ann Anthony Chief Financial Officer c/o OPAL Fuels Inc. One North Lexington Avenue Suite 1450 White Plains, New York 10601 (914) 705-4000 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies of all communications, including communications sent to agent for service, should be sent to: T. Allen McConnell, P.C. Edward M. Welch, Esq. Sheppard, Mullin, Richter & Hampton LLP 30 Rockefeller Plaza New York, New York 10112 Tel: (212) 653-8700 Approximate date of commencement of proposed sale to the public: From time to time after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the SEC, acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED NOVEMBER 3, 2022 PRELIMINARY PROSPECTUS OPAL FUELS INC. UP TO 181,764,740 SHARES OF CLASS A COMMON STOCK This prospectus relates to the issuance by us of up to (i) 9,223,261 shares of Class A common stock, par value $0.0001 per share (the Class A common stock ) underlying Private Placement Warrants (as defined in this prospectus) issued by the Company under the Business Combination Agreement that were originally purchased at a purchase price of $1.00 per warrant, which warrants are exercisable for shares of our Class A common stock at an exercise price of $11.50 per share; and (ii) 6,223,233 shares of Class A common stock underlying Public Warrants (as defined in this prospectus) issued by the Company under the Business Combination Agreement that were originally issued as part of the units sold by Arclight at a purchase price of $10.00 per unit in its initial public offering, which warrants are exercisable for shares of our Class A common stock at an exercise price of $11.50 per share. This prospectus also relates to the offer and sale from time to time by the selling securityholders named in this prospectus (the Selling Holders ) of: (i) 10,838,609 shares of Class A common stock issued under the Business Combination Agreement, dated as of December 2, 2021 (as the same has been or may be amended, modified, supplemented or waived from time to time, the BCA or the Business Combination Agreement ), by and among ArcLight Clean Transition Corp. II ( ArcLight ), Opal Fuels LLC ( Opco ) and Opal Holdco LLC ( OPAL Holdco ) to ARCC Beacon LLC ( Ares ), ArcLight CTC Holdings II, L.P. ( Sponsor ) and certain former directors of ArcLight originally acquired by such parties for an effective purchase price of approximately $0.003 per share; (ii) 144,399,037 shares of Class A common stock issuable upon the conversion of Class C common stock issuable to Opal Holdco and Hillman RNG Investments, LLC (the Opco Common Equityholders ) upon the exchange of Opco Common Units (as defined below) and the cancellation of an equal number of shares of Class D common stock (as defined in this prospectus) originally issued as consideration in connection with the Business Combination at a per share value of $10.00 per share; (iii) 11,080,600 shares of Class A common stock originally issued and sold to certain of the Selling Holders pursuant to subscription agreements dated as of December 2, 2021 (collectively, the PIPE Investors ) at a purchase price of $10.00 per share; and (iv) 9,223,261 shares of class A common stock underlying the Private Placement Warrants. In connection with the Business Combination, holders of 27,364,124 of Arclight s Class A ordinary shares, or 87.94% of the shares with redemption rights, exercised their right to redeem their shares for cash at a redemption price of approximately $10.00 per share, for an aggregate redemption amount of $274,186,522. The shares of Class A common stock being offered for resale pursuant to this prospectus by the Selling Holders represent approximately 708% of shares of Class A common stock outstanding of the Company as of October 13, 2022 (without giving effect to the issuance of shares upon exercise of outstanding Warrants and upon the conversion of Class C common stock to be issued to the Opco Common Equityholders upon the exchange by them of Opco Common Units). Given the substantial number of shares of Class A common stock being registered for potential resale by Selling Holders pursuant to this prospectus, the sale of shares by the Selling Holders, or the perception in the market that the selling Holders of a large number of shares intend to sell shares, could increase the volatility of the market price of our Class A common stock or result in a significant decline in the public trading price of our Class A common stock. Even if our trading price is significantly below $10.00, the offering price for the units offered in Arclight s IPO, certain of the Selling Holders, including the Sponsor, may still have an incentive to sell shares of our Class A common stock because they purchased the shares at prices lower than the public investors or the current trading price of our Class A common stock. For example, based on the closing price of our Class A common stock of $6.23 as of October 13, 2022, Sponsor and other holders of the shares of our Class A common stock that were originally purchased by Arclight s Sponsor in a private placement prior to Arclight s initial public offering (the Founder Shares ) would experience a potential profit of approximately $6.227 per share, or approximately $48,440,306 in the aggregate. We will not receive any proceeds from the sale of shares of Class A common stock by the Selling Holders pursuant to this prospectus. We could receive up to an aggregate of $177,634,681 if all of the Warrants are exercised for cash. However, we will only receive such proceeds if and when the holders of the Warrants choose to exercise them. The exercise of the Warrants, and any proceeds we may receive from their exercise, are highly dependent on the price of our Class A common stock and the spread between the exercise price of the Warrants and the price of our Class A common stock at the time of exercise. We have 15,446,494 outstanding Warrants to purchase 15,446,494 shares of our Class A common stock, exercisable at an exercise price of $11.50 per share. If the market price of our Class A common stock is less than the exercise price of a holder s Warrants, it is unlikely that holders will choose to exercise. As of October 13, 2022, the closing price of our Class A common stock was $6.23 per share. There can be no assurance that the Warrants will be in the money prior to their expiration. In addition, the Sponsor (as defined herein), or its permitted transferees, have the option to exercise the Private Placement Warrants on a cashless basis. As such, it is possible that we may never generate any cash proceeds from the exercise of our Warrants. We will bear all costs, expenses and fees in connection with the registration of the securities. The Selling Holders will bear all commissions and discounts, if any, attributable to their respective sales of the securities. Our registration of the securities covered by this prospectus does not mean that either we or the Selling Holders will issue, offer or sell, as applicable, any of the Class A common stock. The Selling Holders may offer and sell the securities covered by this prospectus in a number of different ways and at varying prices. We provide more information about how the Selling Holders may sell the shares in the section entitled Plan of Distribution. You should read this prospectus and any prospectus supplement or amendment carefully before you invest in our Class A common stock. Our shares of Class A common stock are listed on the Nasdaq Capital Market ( Nasdaq ) under the symbol OPAL. On October 13, 2022, the closing price of our Class A common stock was $6.23 per share. Our public warrants are listed on Nasdaq under the symbol OPALW. On October 13, 2022, the closing price of our public warrants was $1.09 per warrant. We are an emerging growth company, as that term is defined under the federal securities laws and, as such, are subject to certain reduced public company reporting requirements. Investing in our securities involves risks that are described in the Risk Factors section beginning on page 10 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. TABLE OF CONTENTS TRADEMARKS ii SELECTED DEFINITIONS ii CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS vi SUMMARY 1
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes thereto and the information set forth in the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Unless the context otherwise requires, we use the terms Rigetti, Company, we, us and our in this prospectus to refer to Rigetti Computing, Inc. and our wholly owned subsidiaries. Overview We build quantum computers and the superconducting quantum processors that power them. We believe quantum computing represents one of the most transformative emerging capabilities in the world today. By leveraging quantum mechanics, we believe our quantum computers process information in fundamentally new, more powerful ways than classical computers. We have been deploying our quantum computers to end users over the cloud since 2017. We offer our full-stack quantum computing platform as a cloud service to a wide range of end-users, directly through our Rigetti QCS platform, and also through cloud service providers. We have developed strong customer relationships and collaborative partnerships to accelerate the development of key technologies for high-value use cases that unlock strategic early markets. Our partners and customers include commercial enterprises such as Amazon Web Services, Astex Pharmaceuticals, Deloitte, Microsoft, Nasdaq and Standard Chartered Bank, along with U.S. government organizations such as DARPA, DOE, and NASA. We are led by our founder and CEO, Dr. Chad Rigetti, a quantum computing entrepreneur and physicist. Since founding the company in 2013, Dr. Rigetti has led us in becoming a preeminent global leader in quantum computing. He has assembled a world class leadership team and board, and established a culture of innovation within the Company. In addition to his track record as an entrepreneur and executive leader, Dr. Rigetti is an inventor on 38 issued U.S. patents and the author of more than 20 peer-reviewed scientific publications that have received more than 4,000 total citations. Powered by the production of our scalable multi-chip quantum processors in Fab-1 and our full-stack product development approach, our goal is to deliver quantum computing systems that demonstrate clear performance advantages over classical computing alternatives for multiple high-impact application areas. Background Supernova was a blank check company incorporated on December 22, 2020 in the Cayman Islands for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses. On the Closing Date, Rigetti consummated the Business Combination pursuant to the Merger Agreement. Supernova s shareholders approved the Business Combination and Domestication at an extraordinary general meeting of shareholders held on February 28, 2022 (the Extraordinary General Meeting ). In connection with the Extraordinary General Meeting and the Business Combination, holders of 22,915,538 of Supernova s Class A ordinary shares ( Supernova Class A ordinary shares ), or 66.4% of the shares with redemption rights, exercised their right to redeem their shares for cash at a redemption price of approximately $10.00 per share, for an aggregate redemption amount of $229,155,380. Table of Contents On March 1, 2022, the business day prior to the Closing Date, Supernova effectuated the Domestication by filing a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filing a certificate of incorporation (the Certificate of Incorporation ) and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which Supernova was domesticated and continues as a Delaware corporation. The board of directors of Rigetti (the Board ) also adopted the Bylaws of the Company (the Bylaws ) on March 1, 2022, which became effective on that date. In connection with the Domestication, Supernova changed its name from Supernova Partners Acquisition Company II, Ltd. to Rigetti Computing, Inc. As a result of and upon the effective time of the Domestication, among other things, (1) each then issued and outstanding Supernova Class A ordinary share converted automatically, on a one-for-one basis, into a share of common stock; (2) each then issued and outstanding Class B ordinary share, par value $0.0001 per share, of Supernova ( Supernova Class B ordinary share ) converted automatically, on a one-for-one basis, into a share of common stock; (3) each then issued and outstanding whole warrant of Supernova to purchase one Supernova Class A ordinary shares converted automatically into a warrant to acquire one share of common stock at an exercise price of $11.50 per share pursuant to the Warrant Agreement, dated March 1, 2021 (the warrant agreement ), between Supernova and American Stock Transfer & Trust Company, as warrant agent; and (4) each then issued and outstanding unit of Supernova (the Supernova Units ) was separated and converted automatically into one share of common stock and one-fourth of one warrant to purchase common stock. On the Closing Date, Rigetti consummated the First Merger and immediately following the First Merger, consummated the Second Merger. Immediately prior to the effective time of the First Merger, each share of Legacy Rigetti s Series C preferred stock and Series C-1 preferred stock (collectively, the Legacy Rigetti Preferred Stock ), converted into shares of common stock of Legacy Rigetti ( Legacy Rigetti common stock ) in accordance with the Amended and Restated Certificate of Incorporation of Legacy Rigetti (such conversion, the Legacy Rigetti Preferred Conversion ). As a result of the First Merger, among other things, (1) all outstanding shares of Legacy Rigetti common stock as of immediately prior to the Closing (including Legacy Rigetti common stock resulting from the Legacy Rigetti Preferred Stock Conversion), were exchanged at an exchange ratio of calculated pursuant to the Merger Agreement and equal to 0.786989052873439 (the Exchange Ratio ) for an aggregate of 78,959,579 shares of common stock, (2) each warrant to purchase Legacy Rigetti common stock was assumed and converted into a Rigetti assumed warrant, with each Rigetti assumed warrant subject to the same terms and conditions as were applicable to the original Legacy Rigetti warrant and having an exercise price and number of shares of common stock purchasable based on the Exchange Ratio and other terms contained in the Merger Agreement, (3) each option to purchase Legacy Rigetti common stock was assumed and converted into an option to purchase shares of common stock (the Rigetti assumed options ), with each Rigetti assumed option subject to the same terms and conditions as were applicable to the original Legacy Rigetti option and with an exercise price and number of shares of common stock purchasable based on the Exchange Ratio and other terms contained in the Merger Agreement and (4) each Legacy Rigetti restricted stock unit award was assumed and converted into a restricted stock unit award to receive shares of common stock (the Rigetti assumed RSU ), with each Rigetti assumed RSU subject to the same terms and conditions as were applicable to the original Legacy Rigetti restricted stock unit award and the number of shares of common stock to which the Rigetti assumed RSU relates based on the Exchange Ratio and other terms contained in the Merger Agreement. Concurrently with the execution of the Merger Agreement, Supernova entered into Subscription Agreements (the Initial Subscription Agreements ) with certain investors (together, the Initial PIPE Investors ), pursuant to which the Initial PIPE Investors agreed to subscribe for and purchase, and Supernova agreed to issue and sell to the Initial PIPE Investors, an aggregate of 10,251,000 shares of common stock at a price of $10.00 per share, for Table of Contents aggregate gross proceeds of $102,510,000 (the Initial PIPE Financing ). On December 23, 2021, Supernova entered into Subscription Agreements (the Subsequent Subscription Agreements, and together with the Initial Subscription Agreements, the Subscription Agreements ) with two accredited investors (as such term is defined in Rule 501 of Regulation D) (the Subsequent PIPE Investors, and together with the Initial PIPE Investors, the PIPE Investors ) pursuant to which the Subsequent PIPE Investors agreed to subscribe for and purchase, and Supernova agreed to issue and sell to the Subsequent PIPE Investors, an aggregate of 4,390,244 shares of common stock at a price of $10.25 per share, for aggregate gross proceeds of $45,000,000 (the Subsequent PIPE Financing, and together with the Initial PIPE Financing, the PIPE Financing ). Pursuant to the Subscription Agreements, Rigetti agreed to provide the PIPE Investors with certain registration rights with respect to the shares purchased as part of the PIPE Financing. The PIPE Financing was consummated immediately prior to the Merger. Ampere Warrant Concurrently with the execution of the Merger Agreement, on October 6, 2021, Legacy Rigetti entered into the Warrant Subscription Agreement with Ampere for the purchase of the Ampere Warrant for an aggregate purchase price (including amounts for exercise) of $10,000,000 pursuant to which the Ampere Warrant may be exercised by Ampere at an exercise price of $0.0001 per share for 1,000,000 shares of the Company s common stock. The Warrant Subscription Agreement was assumed by the Company pursuant to the Merger Agreement in connection with the closing of the business combination pursuant to the Merger Agreement. On June 30, 2022, pursuant to the Warrant Subscription Agreement, the Company issued the Ampere Warrant to Ampere upon receipt of an aggregate of $5 million (including the exercise price), and upon such payment and issuance, 500,000 shares of common stock vested under the Ampere Warrant and were immediately exercised by Ampere pursuant to the terms of the Ampere Warrant. The purchase of the Ampere Warrant pursuant to the Warrant Subscription Agreement was conditioned upon, among other things, the consummation of the Business Combination pursuant to the Merger Agreement and the entry into a collaboration agreement between Legacy Rigetti and Ampere. Pursuant to the Warrant Subscription Agreement, Ampere is required to pay, subject to the satisfaction of certain conditions, an additional $4,999,950 (the Additional Payment ) to the Company no later than the second anniversary of the date of the Warrant Subscription Agreement, and upon such payment, the Unexercised Warrant Shares will vest and be exercisable by Ampere pursuant to the terms of the Ampere Warrant. If the conditions to payment are not satisfied by the second anniversary of the date of the Warrant Subscription Agreement, the Company may reject Ampere s payment of the Additional Payment and the Unexercised Warrant Shares will not vest or be exercisable and Ampere will have no further obligation with respect to the payment of the Additional Payment. The Ampere Warrant and the shares of common stock issued pursuant to the Ampere Warrant have not been registered under the Securities Act of 1933, as amended, and were issued in reliance on an exemption from such registration. We are registering the resale of the Shares as required by the registration rights contained in the Warrant Subscription Agreement. We cannot predict when or if the Additional Payment will be received by the Company and if the Unexercised Warrant Shares will vest and become exercisable, and it is possible that we may never receive the Additional Payment, that the Ampere Warrant will not be exercised for the additional 500,000 shares of common stock, and that the Unexercised Warrant Shares may never be issued. Recent Developments On August 11, 2022, we entered into a Common Stock Purchase Agreement (the Committed Equity Purchase Agreement ) and a Registration Rights Agreement (the Committed Equity Registration Rights Agreement ) with B. Riley Principal Capital II, LLC ( B. Riley ). Pursuant to the Committed Equity Purchase Agreement, subject to the satisfaction of the conditions set forth therein, we will have the right to sell to B. Riley up to $75,000,000 of newly issued shares (the Committed Equity Shares ) of our common stock (subject to certain conditions and limitations contained in the Purchase Agreement), from time to time during the term of the Table of Contents Purchase Agreement. Sales of common stock pursuant to the Committed Equity Purchase Agreement, and the timing of any sales, are solely at our option, and we are under no obligation to sell any securities to B. Riley under the Committed Equity Purchase Agreement. See Management s Discussion and Analysis of Financial Condition and Results of Operations Committed Equity Facility for more information. Summary Risk Factors The following is a summary of select risks and uncertainties that could materially adversely affect us and our business, financial condition and results of operations. Before you invest in our common stock, you should carefully consider all the information in this prospectus, including matters set forth under the heading Risk Factors, immediately following this prospectus summary. These risks include the following, among others: We are in our early stages and have a limited operating history, which makes it difficult to forecast our future results of operations. We have a history of operating losses and expect to incur significant expenses and continuing losses for the foreseeable future. Even if the market in which we compete achieves anticipated growth levels, our business could fail to grow at similar rates, if at all. We will require a significant amount of cash for expenditures as we invest in ongoing research and development and business operations and may need additional capital sooner than planned to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances, and we cannot be sure that additional financing will be available. If we are unable to raise additional funding when needed, we may be required to delay, limit or substantially reduce our quantum computing development efforts. Our ability to use net operating loss carryforwards and other tax attributes may be limited in connection with the Business Combination or other ownership changes. We have not produced quantum computers with high qubit counts or at volume and face significant barriers in our attempts to produce quantum computers, including the need to invent and develop new technology. If we cannot successfully overcome those barriers, our business will be negatively impacted and could fail. Any future generations of hardware developed to demonstrate narrow quantum advantage and broad quantum advantage and the anticipated release of an 84 qubit system, 336 qubit system, 1,000+ qubit system and 4,000+ qubit system, each of which is an important anticipated milestone for our technical roadmap and commercialization, may not occur on our anticipated timeline or at all. The quantum computing industry is competitive on a global scale and we may not be successful in competing in this industry or establishing and maintaining confidence in our long-term business prospects among current and future partners and customers. Our business is currently dependent upon our relationship with our cloud providers. There are no assurances that we will be able to commercialize quantum computers from our relationships with cloud providers. We depend on a limited number of customers for a significant percentage of our revenue and the loss or temporary loss of a major customer for any reason could harm our financial condition. A significant portion of our revenue depends on contracts with the public sector, and our failure to receive and maintain government contracts or changes in the contracting or fiscal policies of the public sector could have a material adverse effect on our business. Table of Contents We rely on access to high performance third party classical computing through public clouds, high performance computing centers and on-premises computing infrastructure to deliver performant quantum solutions to customers. We may not be able to maintain high quality relationships and connectivity with these resources which could make it harder for us to reach customers or deliver solutions in a cost-effective manner. We depend on certain suppliers to source products. Failure to maintain our relationship with any of these suppliers, or a failure to replace any supplier, could have a material adverse effect on our business, financial position, results of operations and cash flows. Our system depends on the use of certain development tools, supplies, equipment and production methods. If we are unable to procure the necessary tools, supplies and equipment to build our quantum systems, or are unable to do so on a timely and cost-effective basis, and in sufficient quantities, we may incur significant costs or delays which could negatively affect our operations and business. Even if we are successful in developing quantum computing systems and executing our strategy, competitors in the industry may achieve technological breakthroughs which render our quantum computing systems obsolete or inferior to other products. We may be unable to reduce the cost of developing our quantum computers, which may prevent us from pricing our quantum systems competitively. The quantum computing industry is in its early stages and volatile, and if it does not develop, if it develops slower than we expect, if it develops in a manner that does not require use of our quantum computing solutions, if we encounter negative publicity or if our solution does not drive commercial engagement, the growth of our business will be harmed. If our computers fail to achieve quantum advantage, our business, financial condition and future prospects may be harmed. We could suffer disruptions, outages, defects and other performance and quality problems with our quantum computing systems, our production technology partners or with the public cloud, data centers and internet infrastructure on which we rely. We have identified a material weakness in our internal control over financial reporting and may identify additional material weaknesses in the future. If we fail to remediate the material weakness or if we identify additional material weaknesses, or if we otherwise fail to establish and maintain effective control over financial reporting, it may adversely affect our ability to accurately and timely report our financial results, and may adversely affect investor confidence and business operations. System security and data protection breaches, as well as cyber-attacks, including state-sponsored attacks, could disrupt our operations, which may damage our reputation and adversely affect our business. Our failure to obtain, maintain and protect our intellectual property rights could impair our ability to protect and commercialize our proprietary products and technology and cause us to lose our competitive advantage. Delaware law and our Certificate of Incorporation and Bylaws contain certain provisions, including anti-takeover provisions, that limit the ability of stockholders to take certain actions and could delay or discourage takeover attempts that stockholders may consider favorable. We will require a significant amount of cash for expenditures as we invest in ongoing research and development and business operations and may need additional capital sooner than planned to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances, Table of Contents and we cannot be sure that additional financing will be available. If we are unable to raise additional funding when needed, we may be required to delay, limit or substantially reduce our quantum computing development efforts. Our warrants, including our public warrants, private placement warrants and other warrants we have issued, are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results. Sales of our securities, or perceptions of sales, by us or holders of our securities, including the selling stockholder pursuant to this prospectus, in the public markets or otherwise, including in connection with our committed equity financing with B. Riley, could cause the market price for our common stock to decline and future issuances of securities may adversely affect us and our common stock and may be dilutive to existing stockholders. There can be no assurance that we will be able to comply with the continued listing standards of Nasdaq. Our warrants may be out of the money at the time they become exercisable and they may expire worthless. With the approval by the holders of at least 50% of the then-outstanding public warrants, we may amend the terms of the warrants in a manner that may be adverse to holders. Corporate Information Our principal executive offices are located at 775 Heinz Avenue, Berkeley, CA 94710 and our telephone number is (510) 210-5550. Our corporate website address is www.rigetti.com. Information contained on or accessible through our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. Rigetti and our other registered and common law trade names, trademarks and service marks are property of Rigetti Computing, Inc. This prospectus contains additional trade names, trademarks and service marks of others, which are the property of their respective owners. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or symbols. Emerging Growth Company and Smaller Reporting Company Status We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 ( JOBS Act ). As an emerging growth company, we are exempt from certain requirements related to executive compensation, including the requirements to hold a nonbinding advisory vote on executive compensation and to provide information relating to the ratio of total compensation of our Chief Executive Officer to the median of the annual total compensation of all of our employees, each as required by the Investor Protection and Securities Reform Act of 2010, which is part of the Dodd-Frank Act. Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable. Supernova previously elected to avail itself of the extended transition period and we will take advantage of the benefits of the extended transition period emerging growth company status permits. During the extended transition period, it may be difficult or impossible to compare our financial results with the financial results of another public company that complies with public company effective dates for accounting standard updates because of the potential differences in accounting standards used. Table of Contents We will remain an emerging growth company under the JOBS Act until the earliest of (a) December 31, 2026 (the last day of the fiscal year following the fifth anniversary of the consummation of the IPO), (b) the last date of our fiscal year in which we have a total annual gross revenue of at least $1.07 billion, (c) the date on which we are deemed to be a large accelerated filer under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates or (d) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years. We are also a smaller reporting company as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as the market value of our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter. Table of Contents
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+PROSPECTUS SUMMARY 1
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+Explanatory Note This registration statement registers the resale of outstanding warrants and underlying common stock issued by RenovoRx, Inc. (the "Registrant"). This registration statement relates to the registration by us of up to 2,786,995 shares of our Common Stock, par value $0.0001 per share (the "Common Stock") issuable upon the exercise of warrants, including: (i) 1,879,300 warrants originally issued in a public offering in connection with the Registrant s initial public offering (with each warrant entitling a holder to purchase one share of common stock at an exercise price equal to $10.80 per share, exercisable until the fifth anniversary of the issuance date, and subject to certain adjustment and cashless exercise provisions as described herein) (the "IPO Warrants"); (ii) 198,875 warrants issued to the underwriters of the Registrant s initial public offering (with each warrant entitling a holder to purchase one share of common stock at an exercise price equal to $10.80 per share, exercisable until the fifth anniversary of the issuance date, and subject to certain adjustment and cashless exercise provisions as described herein) (the "Underwriter Warrants"); and (iii) 708,820 warrants issued in a private transaction upon the conversion of the Registrant s outstanding convertible notes at the time of the Registrant s initial public offering (with each warrant entitling a holder to purchase one share of common stock at an exercise price equal to $10.80 per share, exercisable until the fifth anniversary of the issuance date, and subject to certain adjustment and cashless exercise provisions as described herein) (the "Note Warrants"). In addition, the selling securityholders named in this registration statement or their permitted transferees (the "Selling Securityholders") may resell up to 708,820 Note Warrants. In addition, this registration statement registers the resale by the Selling Securityholders of up to the following: (i) 1,879,300 shares of common stock issued upon the exercise of the IPO Warrants; (ii) 198,875 shares of common stock issued upon the exercise of the Underwriter Warrants; and (iii) 708,820 shares of common stock issued upon the exercise of the Note Warrants. The issuance, resale and exercise of the IPO Warrants and Underwriter Warrants, and the subsequent resale of the shares of common stock issuable upon the exercise of the IPO Warrants and the Underwriter Warrants, were previously registered on the Registration Statement on Form S-1 (Registration No. 333-258071) related to the Registrant s initial public offering (the "IPO Registration Statement"). This registration statement now registers the exercise of the currently outstanding IPO Warrants and Underwriter Warrants and resale of such shares of common stock issuable upon such exercise in lieu of the IPO Registration Statement. The Registrant has applied the applicable registration fees from the IPO Registration Statement with respect to the IPO Warrants and Underwriter Warrants to this registration statement as noted in the registration fee exhibit which is filed as an exhibit to this registration statement. The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED NOVEMBER 10, 2022 PROSPECTUS Primary Offering of 2,786,995 Shares of Common Stock Issuable Upon Exercise of Warrants Secondary Offering of 708,820 Warrants to Purchase Shares of Common Stock and 2,786,995 Shares of Common Stock This registration statement relates to the registration by us of up to 2,786,995 shares of our Common Stock issuable upon the exercise of warrants, including: (i) 1,879,300 warrants originally issued in our initial public offering (the "IPO Warrants"); (ii) 198,875 warrants issued to the underwriters of our initial public offering (the "Underwriter Warrants"); and (iii) 708,820 warrants issued in a private transaction upon the conversion of our outstanding convertible notes at the time of our initial public offering (the "Note Warrants"). In addition, the selling securityholders named in this prospectus or their permitted transferees (the "Selling Securityholders") may use this prospectus to resell up to 708,820 Note Warrants. The purchase price of each warrant was negligible as the warrants were sold as part of a unit with a share of common stock for the IPO Warrants and the Note Warrants, and as partial consideration for the underwriters in the case of the Underwriter Warrants. In addition, the Selling Securityholders may use this prospectus to resell up to the following: (i) 1,879,300 shares of common stock issued upon the exercise of the IPO Warrants; (ii) 198,875 shares of common stock issued upon the exercise of the Underwriter Warrants; and (iii) 708,820 shares of common stock issued upon the exercise of the Note Warrants. The Selling Securityholders may sell any, all or none of the securities, and we do not know when or in what amount the Selling Securityholders may sell their securities hereunder following the date of this prospectus. The Selling Securityholders may sell the securities described in this prospectus in a number of different ways and at varying prices. We provide more information about how the Selling Securityholders may sell their securities in the section titled "Plan of Distribution." We will not receive any of the proceeds from the sale of the securities by the Selling Securityholders. We will receive proceeds from the exercise of the Warrants if the Warrants are exercised for cash. We believe the likelihood that warrant holders will exercise their warrants, and therefore the amount of cash proceeds we would receive, is dependent upon the trading price of our Common Stock. If the trading price of our Common Stock is less than the $10.80 exercise price per share of the warrants, we expect that warrant holders will not exercise their warrants. We could receive up to an aggregate of approximately $30.1 million if all of the warrants are exercised for cash, but we will only receive such proceeds if and when the warrant holders exercise the warrants. There is no guarantee the warrants will be in the money following the time they become exercisable and prior to their expiration, and as such, the warrants may expire worthless and we may receive no proceeds from the exercise of warrants. To the extent that any of the warrants are exercised on a "cashless basis" under certain conditions, we will not receive any proceeds upon such exercise. We do not expect to rely on the cash exercise of warrants to fund our operations. Instead, we intend to rely on our primary sources of cash discussed in our quarterly and annual reports to continue to support our operations. We will pay the expenses associated with registering the sales by the Selling Securityholders other than any brokerage fees or commissions as described in more detail in the section titled "Use of Proceeds." Our common stock is listed on the Nasdaq Capital Market under the symbol "RNXT." On November 9, 2022, the last reported sale price of our common stock on the Nasdaq Capital Market was $1.93 per share. The Warrants are not listed on any securities exchange or nationally recognized trading system, and we do not expect a market to develop for the Warrants. We are an "emerging growth company" under the federal securities laws and have elected to comply with certain reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See "Risk Factors" beginning on page 4. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022 TABLE OF CONTENTS PROSPECTUS SUMMARY 2
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diff --git a/parsed_sections/prospectus_summary/2022/SES-WT_ses-ai_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SES-WT_ses-ai_prospectus_summary.txt
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+SUMMARY OF THE PROSPECTUS 1
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+PROSPECTUS SUMMARY 1 SUMMARY CONSOLIDATED HISTORICAL AND OTHER FINANCIAL INFORMATION 24 SUMMARY UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION 28 RISK FACTORS 30 CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS 79 UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION 80 USE OF PROCEEDS 93 DIVIDEND POLICY 94 CAPITALIZATION 95 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 96 BUSINESS 131 MANAGEMENT 163 BENEFICIAL OWNERSHIP OF SECURITIES 178 SELLING SECURITYHOLDERS 180 RELATED PARTY TRANSACTIONS 184 DESCRIPTION OF SECURITIES 186 MATERIAL TAX CONSIDERATIONS 203 ENFORCEABILITY OF JUDGMENTS 212 PLAN OF DISTRIBUTION 214 LEGAL MATTERS 217 EXPERTS 217 WHERE YOU CAN FIND MORE INFORMATION 217 INDEX TO FINANCIAL STATEMENTS F-1 Table of Contents PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary may not contain all the information that may be important to you, and we urge you to read this entire prospectus carefully, including the Risk Factors, Business and Management s Discussion and Analysis of Financial Condition and Results of Operations sections and our consolidated financial statements and the notes thereto, included elsewhere in this prospectus, before deciding to invest in our ordinary shares. For purposes of this section, unless otherwise indicated or the context otherwise requires, all references to Super Group, the Company, we, our, ours, us or similar terms refer to (i) Super Group (SGHC) Limited and its consolidated subsidiaries after the Closing and (ii) SGHC Limited and its consolidated subsidiaries prior to the Closing. Our Business Overview Super Group is a leading global online sports betting and gaming operator. Super Group s mission is to responsibly provide first-class entertainment to the worldwide online betting and gaming community. Super Group s strategy for achieving this is built around three key pillars: 1. Expanding its global footprint into as many regulated markets as possible in order to engage with as many customers as it can possibly reach; 2. Increasing awareness of its brands through strategic partnerships and coordinated sponsorship and marketing campaigns; and 3. Utilizing enhanced proprietary data to optimize the confluence of ethical corporate culture, responsible gaming values, value-for-money product offerings and customer-centric service delivery. As of the date of this prospectus, Super Group subsidiaries are licensed in 24 jurisdictions and manage approximately 4,000 employees. Over the twelve months of 2021, on average, over 2.8 million customers per month have yielded in excess of $3.2 billion in wagers per month. During the period January 1, 2020 to December 31, 2021, total wagers amounted to 38 billion. Super Group s business generated 1.26 billion ($1.48 billion) of net gaming revenue between January 1, 2021 and December 31, 2021 in different geographic regions, including the Americas, Europe, Africa and the rest of the world, such regions accounting for approximately 47%, 11%, 17% and 25%, respectively, of Super Group s total revenue in 2021. What Super Group Does Super Group s global online sports betting and casino gaming services are delivered to customers by way of two primary product offerings: Betway, a single-brand premier online sports betting offering, and Spin, a multi-brand online casino offering. Betway is SGHC s single-brand online sports betting offering with a global footprint derived from licenses to operate throughout Europe, the Americas and Africa. The brand is sports-led but also offers casino games. Betway seeks to continue to grow brand awareness, including through an expanding portfolio of partnerships and collaborations with sports teams and leagues worldwide. As of the date of this prospectus, Betway has more than 70 such arrangements and is actively negotiating for further expansion. Table of Contents The information contained in this preliminary prospectus is not complete and may be changed. Neither we nor the selling securityholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it s not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JULY 7, 2022 Up to 481,074,588 Ordinary Shares Up to 11,000,000 Warrants Super Group (SGHC) Limited (a non-cellular company limited by shares incorporated and registered under the laws of the Island of Guernsey) This prospectus relates to the offer and sale from time to time by the selling securityholders or their permitted transferees (collectively, the selling securityholders ) of (i) up to 481,074,588 ordinary shares, no par value (including up to 11,000,000 ordinary shares that may be issued upon exercise of the private placement warrants) and (ii) up to 11,000,000 private placement warrants (as defined below). This prospectus also covers any additional securities that may become issuable by reason of share splits, share dividends or other similar transactions. Capitalized terms used in this Prospectus and not otherwise defined have the meanings set forth in the Frequently Used Terms. We are registering the offer and sale of the securities described above to satisfy certain registration rights we have granted. The selling securityholders may offer all or part of the securities for resale from time to time through public or private transactions, at either prevailing market prices or at privately negotiated prices. Our ordinary shares and public warrants are currently listed on the New York Stock Exchange (the NYSE ) under the symbols SGHC and SGHC WS, respectively. The last reported sale price of our ordinary shares on July 5, 2022 was $4.36 per share. The selling securityholders acquired their securities at prices that are significantly less than the current trading price of our ordinary shares. Certain of the selling securityholders, referred to as the Founder Holders (including PJT Partners Holdings LP, through its economic interest in Sport Entertainment Acquisition Holdings LLC) paid an average price of approximately $0.002 per share for each ordinary share and $1.00 per private placement warrant for each warrant being offered by this prospectus. The other selling securityholders similarly acquired their ordinary shares at nominal prices. These securities are being registered to permit the selling securityholders to sell securities from time to time, in amounts, at prices and on terms determined at the time of offering. The selling securityholders may sell these securities through ordinary brokerage transactions, directly to market makers of our shares or through any other means described in the section titled Plan of Distribution . In connection with any sales of ordinary shares offered hereunder, the selling securityholders, any underwriters, agents, brokers or dealers participating in such sales may be deemed to be underwriters within the meaning of the Securities Act of 1933, as amended (the Securities Act ). The ordinary shares being offered for resale pursuant to this prospectus by the selling securityholders would represent approximately 98% of our outstanding ordinary shares as of May 31, 2022 (after giving effect to the issuance of the shares issuable upon exercise of the warrants held by the selling securityholders). Given the substantial number of ordinary shares being registered for potential resale by selling securityholders pursuant to this prospectus, the sale of shares by the selling securityholders, or the perception in the market that the selling securityholders of a large number of shares intend to sell shares, could increase the volatility of the market price of our ordinary shares or result in a significant decline in the public trading price of our ordinary shares. Even if our trading price is significantly below $10.00, the offering price for the units offered in the initial public offering of Sports Entertainment Acquisition Corp., or SEAC, the purchasers of which exchanged their SEAC shares for our ordinary shares in the business combination described in this prospectus, the selling securityholders may still have an incentive to sell our ordinary shares because they purchased the shares at prices that are significantly lower than the purchase prices paid by our public investors or the current trading price of our ordinary shares. While the selling securityholders may experience a positive rate of return on their investment in our ordinary shares as a result, the public securityholders may not experience a similar rate of return on the securities they purchased due to differences in their purchase prices and the trading price. For example, based on the closing price of our ordinary shares of $4.36 as of July 5, 2022, the Founder Holders would experience a potential profit of up to approximately $4.36 per share, or up to approximately $86.0 million in the aggregate (after giving effect to the issuance of ordinary shares issuable upon exercise of the private placement warrants held by the Founder Holders). The other selling securityholders would similarly experience a profit of up to $4.36 per share or up to approximately $2.09 billion in the aggregate. All of the securities offered by the selling securityholders pursuant to this prospectus will be sold by the selling securityholders for their respective accounts. We will not receive any of the proceeds from such sales, except with respect to amounts received by us upon exercise of warrants to the extent such warrants are exercised for cash. The exercise price of our outstanding warrants is $11.50 per share, which exceeds the trading price of our ordinary shares as of the date of this prospectus. If the trading price of our ordinary shares remains below the exercise price of the warrants, the warrants may never be exercised and we may never receive the cash proceeds of such exercises. We will pay certain expenses associated with the registration of the securities covered by this prospectus, as described in the section titled Plan of Distribution . We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. We are a foreign private issuer as defined under the Securities and Exchange Commission, or SEC, rules and will be subject to reduced public company reporting requirements for this prospectus and future filings. See, Prospectus Summary Implications of Being a Foreign Private Issuer. Our business and an investment in our ordinary shares involves a high degree of risk. See Risk Factors beginning on page 30 of this prospectus, and under similar headings in any amendments or supplements to this prospectus. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Prospectus dated July , 2022 Table of Contents ABOUT THIS PROSPECTUS Unless otherwise indicated or the context otherwise requires, all references in this prospectus to Super Group, the Company, we, our, ours, us or similar terms refer to (i) Super Group (SGHC) Limited and its consolidated subsidiaries after the Closing and (ii) SGHC Limited and its consolidated subsidiaries prior to the Closing. Super Group (SGHC) Limited is the new combined company in connection with the Business Combination, in which shareholders of Super Group and SEAC exchanged their shares for shares in Super Group (SGHC) Limited. Neither we nor the selling securityholders have authorized anyone to provide any information other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we may have referred you. Neither we nor the selling securityholders take any responsibility for, or provide any assurance as to the reliability of, any other information that others may give you. Neither we nor the selling securityholders are making an offer to sell the ordinary shares in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus, regardless of the time of delivery of this prospectus or any sale of the ordinary shares. Our business, financial condition, results of operations and prospects may have changed since the date on the front cover of this prospectus. For investors outside the United States: neither we nor the selling securityholders have done anything that would permit the possession or distribution of this prospectus in any jurisdiction, other than the United States, where action for that purpose is required. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the ordinary shares and the distribution of this prospectus outside the United States. Table of Contents Spin is SGHC s multi-brand online casino offering. Spin s diverse portfolio of more than 20 casino brands is designed to be culturally relevant across the globe while aiming to offer a wide range of casino products. Spin is casino-led but some of its brands also offer sports betting products. Spin seeks to achieve growth through a broad range of targeted marketing channels in which SGHC believes an expansive brand portfolio to be a significant asset. SGHC aims to further expand its global footprint through the acquisition of Digital Gaming Corporation Limited ( DGC ), which is the parent of Digital Gaming Corporation USA ( DGC USA ), which holds the exclusive license to use the Betway brand in the United States. On April 7, 2021, SGHC entered into a definitive agreement to acquire DGC, subject to certain regulatory approvals and customary closing conditions. This transaction is expected to close in the second half of 2022. DGC USA has already secured market access in up to an initial 12 regulated or expected-to-be regulated states in the United States and its acquisition will enable SGHC to penetrate and leverage its capabilities in these new markets. As of the date of this prospectus, the Betway brand (operated by licensee, DGC USA) is live in 6 US states, being Arizona, New Jersey, Pennsylvania, Indiana, Iowa and Colorado. DGC USA s subsidiary, DGC VA, received its Temporary Permit to operate in the Commonwealth of Virginia in November 2021 and is expected to launch a Betway-branded sports betting offering in the Commonwealth in the second quarter of 2022. For the remaining 5 states, being Ohio, Kansas, Louisiana, Mississippi and Missouri, as a result of a combination of timing around the introduction of regulations and/or receipt of required licenses and approvals, there is currently no specific timeline for go-live. An agreement is also in place for the provision of an additional casino brand in Pennsylvania. Following Betway s global expansion, the Company has, in certain circumstances, licensed the brand to third parties in certain jurisdictions where licensees are in a better position to capture market opportunity while taking advantage of the global brand, in consideration for a license fee. Company Background Super Group, is a holding company incorporated under the laws of the Island of Guernsey, and was incorporated for the purpose of effectuating the Business Combination described in this prospectus. Prior to the Business Combination, which occurred on January 27, 2022, Super Group had no material assets and did not operate any businesses. SGHC is a holding company incorporated under the laws of the Island of Guernsey and its business and operations are conducted through numerous subsidiaries that are incorporated in various jurisdictions around the world. The principal executive office of SGHC and Super Group are located in Bordeaux Court, Les Echelons, St. Peter Port, Guernsey, GY1 1AR. SGHC was incorporated in July 2020, with the designed purpose of becoming the ultimate parent company of Pindus Holdings Limited ( Pindus ), Fengari Holdings Limited ( Fengari ), and Pelion Holdings Limited ( Pelion ), through a reorganization of entities with common ownership. Pelion and Fengari collectively house the Spin business while Pindus and other entities also acquired pursuant to the reorganization collectively house the Betway business. Predecessor companies for the two businesses were established from 1997 onwards. Of the founders and early staff members of these predecessor companies, more than 20 remain who have been employed by the Company for more than 20 years, including CEO Neal Menashe and CFO Alinda van Wyk. On October 7, 2020, SGHC entered into an agreement with the shareholders of Fengari, a holding company incorporated under the laws of the Island of Guernsey, pursuant to which it acquired the entire issued share capital of Fengari. The purpose of this transaction was to consolidate Fengari and its subsidiaries into the SGHC group while retaining the ultimate beneficial ownership position of Fengari. On October 7, 2020, SGHC entered into an agreement with the shareholders of Pelion, a holding company incorporated under the laws of the Island of Guernsey, pursuant to which it acquired the entire issued share capital of Pelion. The purpose of this transaction was to consolidate Pelion and its subsidiaries into the SGHC group while retaining the ultimate beneficial ownership position of Pelion. See Management s Discussion and Analysis of Financial Conditions and Results of Operations Comparability of Financial Information. Table of Contents FREQUENTLY USED TERMS Unless otherwise stated in this prospectus or the context otherwise requires, references to: Business Combination means the transactions contemplated by the Business Combination Agreement. Business Combination Agreement means the Business Combination Agreement, dated as of April 23, 2021, by and among SEAC, SGHC, Super Group, Merger Sub and Sponsor, a copy of which was filed as Exhibit 2.1 to Sports Entertainment Acquisition Corp. s Current Report on Form 8-K with the SEC on April 26, 2021. Class A Shares means SEAC s Class A common stock, par value $0.0001. Class B Shares means SEAC s Class B common stock, par value $0.0001. Closing means the closing of the Business Combination. common stock means Class A Shares and Class B Shares. Company means Super Group. Continental means Continental Stock Transfer & Trust Company. DGCL means the Delaware General Corporation Law as the same may be amended from time to time. DTC means the Depository Trust Company. Exchange Act means the Securities Exchange Act of 1934, as amended. Founder Holders means each of Sponsor, Natara Holloway Branch, Timothy Goodell and their permitted transferees. Guernsey Companies Law means the Companies (Guernsey) Law, 2008 (as amended). IFRS means the International Financial Reporting Standards as set forth by the International Accounting Standards Board. IPO means SEAC s October 6, 2020 initial public offering of units, with each unit consisting of one Class A Share and one-half of one warrant, raising total gross proceeds of approximately $450,000,000. Merger Sub means Super Group (SGHC) Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of the Company. NYSE means the New York Stock Exchange. Pre-Closing Holders means the existing shareholders of SGHC prior to the Closing. private placement warrants means the warrants issued to the Sponsor and PJT Partners Holdings LP in a private placement simultaneously with the closing of the IPO as well as in connection with the closing of the partial exercise by the underwriters of their over-allotment option, with each such warrant entitling the holder thereof to purchase one Class A Share at a price of $11.50 per share. public warrants means the 22,500,000 redeemable warrants sold as part of the units in the IPO. Sarbanes-Oxley Act means the Sarbanes-Oxley Act of 2002. SEAC means Sports Entertainment Acquisition Corp., a Delaware corporation. SEAC Holders means Founder Holders and PJT Partners Holdings LP. SEC means the United States Securities and Exchange Commission. Securities Act means the Securities Act of 1933, as amended. Table of Contents SGHC s Opportunity and Large and Expanding Total Addressable Market The Growing Global Sports Betting and Online Casino Gaming Markets SGHC s brands operate in two distinct sectors of the global online gaming market, namely sports betting and online casino gaming, both of which have recently experienced significant growth and which are expected to continue to grow further in the coming years. According to H2 Gambling Capital ( H2 ), global online sports betting gross gaming revenue ( GGR ) is projected to grow from $53.8 billion in 2021 to $87.2 billion by 2026, while the global online casino gaming market is projected to grow from $33.0 billion in 2021 to $61.3 billion by 2026, in part due to projected strong growth in newly regulated markets, including within the United States. Several countries in Africa and Europe have already liberalized and regulated sports betting and/or online casino gaming with several more in the early stages of doing so. H2 has projected European sports betting and online casino gaming GGR to grow from $38.1 billion in 2021 to as much as $54.8 billion by 2026, and projects African GGR to grow from $1.5 billion in 2021 to $4.1 billion by 2026. Africa and Europe are already significant markets for SGHC and the Company believes that it is well-positioned to take advantage of opportunities as and when jurisdictions within these regions regulate online sports betting and online casino gaming. In May 2018 the U.S. Supreme Court repealed the Professional and Amateur Sports Protection Act of 1992 ( PASPA ), the effect of which was to remove federal restrictions on sports betting and give individual states control over the legalization of sports betting within their jurisdictions. As of December 31, 2021, 33 states plus Washington, DC have passed measures to legalize sports betting (three of those states are not yet operational) . Out of that number, 22 states have authorized statewide online sports betting while 11 remain retail-only at casino or retail locations. Seven states have passed measures to legalize online casino gaming. In Canada, Parliament recently passed legislation allowing provinces to regulate single-game wagering within each province and Ontario has initiated a regime where it has begun accepting applications for registrations for regulated sports betting and casino gaming. H2 currently projects that the North American online sports betting and casino market will generate an estimated $40.6 billion in GGR in 2026, increased from $12.2 billion in 2021, of which $35.3 billion and $9.6 billion respectively is projected to come from the United States (excluding state lotteries). SGHC is a market leader in sports betting and online casino gaming, with net gaming revenue of $1.48 billion ( 1.26 billion) in the year ended December 31, 2021, of which approximately 49.2% was generated by Betway and the remainder from Spin. The Company holds licenses, which include both sports betting and online casino gaming, in 24 jurisdictions, excluding up to 12 jurisdictions in which DGC USA has obtained initial agreed market access deals in the United States (either via obtaining the required licenses or approvals from the relevant state authorities or via commercial arrangements through which DGC USA leases a license from a land-based operator to satisfy the legal requirement that any online operation must be tethered to a land-based operation), and is currently applying for or negotiating licenses in other states and jurisdictions. As of the date of this prospectus, the Betway brand (operated by licensee, DGC USA) is live in 6 US states, being Arizona, New Jersey, Pennsylvania, Indiana, Iowa and Colorado. DGC USA s subsidiary, DGC VA, received its Temporary Permit to operate in the Commonwealth of Virginia in November 2021 and is expected to launch a Betway-branded sports betting offering in the Commonwealth in the second quarter of 2022. For the remaining 5 states, being Ohio, Kansas, Louisiana, Mississippi and Missouri, as a result of a combination of timing around the introduction of regulations and/or receipt of required licenses and approvals, there is currently no specific timeline for go-live. An agreement is also in place for the provision of an additional casino brand in Pennsylvania. Table of Contents Sellers means certain shareholders who are officers and employees of the Target Companies ( Management ) and certain other existing shareholders of SGHC (the Co-Investors ). SGHC means SGHC Limited, a non-cellular company limited by shares incorporated under the laws of the Island of Guernsey. Sponsor means Sport Entertainment Acquisition Holdings LLC, a Delaware limited liability company. Super Group means Super Group (SGHC) Limited, a non-cellular company limited by shares incorporated under the laws of the Island of Guernsey, and its subsidiaries when the context requires. Super Group Board means the board of directors of Super Group. Super Group Governing Documents means the Super Group Amended and Restated Memorandum of Incorporation and the Super Group Amended and Restated Articles of Incorporation. Super Group ordinary shares or ordinary shares means the ordinary redeemable shares of Super Group, of no par value. Super Group Sponsor warrants means the Super Group warrants converted from the private placement warrants issued by SEAC to the Sponsor or PJT Partners Holdings LP. Super Group Warrants means each issued and outstanding SEAC warrant to purchase a share of SEAC Class A common stock that has become exercisable for one Super Group ordinary share. Target Companies means, collectively, SGHC, the Company, Merger Sub and all direct and indirect subsidiaries of SGHC. Transfer Agent means Continental Stock Transfer & Trust Company. underwriters means Goldman Sachs & Co. LLC and PJT Partners LP. warrants means the private placement warrants and public warrants. Table of Contents SGHC s Core Strengths Management believes that the following are key factors underlying SGHC s successful expansion: Betway s global single brand offers significant marketing economies of scale SGHC s flagship brand, Betway, operates as a global, online, sports-led betting brand that is consistently positioned in all markets. This approach aims to leverage national, regional and local marketing spend for global benefit, and management believes that it will generate significant marketing economies of scale as the business expands and Betway continues to launch into new markets. See the sections titled Strategy, Products and Business Model and Business Sales and Marketing for further detail. For example, in advance of launching in the United States, Betway has entered into marketing partnerships with U.S. sports franchises such as the Chicago Bulls, the Cleveland Cavaliers, the Los Angeles Clippers, the Golden State Warriors and the New York Islanders. Management believes that, in addition to raising the profile of Betway s brand in the United States, the global reach of these brands will benefit the Company in markets outside of the United States where U.S. sports are followed. Previous examples of the value of this strategy include the Company s partnership with the English Premier League team West Ham United, which according to independent assessment has to date returned value equivalent to 5.8 times the cost thereof. Management actively seeks to validate its belief in this approach by means of regular brand awareness studies, as evidenced by the following chart: Spin s multi-brand casino portfolio maximizes market share Spin s multi-brand online casino offering is designed with the intention of capturing additional shelf space across a myriad of marketing channels, particularly in markets where opportunities for effective large scale brand advertising are harder to come by and/or where more diverse marketing approaches are necessary. For example, in some markets the Company believes that the predominant or more effective form of marketing is with the assistance of independent affiliates marketers. In particular, in such circumstances the Company believes that there is significant benefit in providing such affiliates with a wide array of brands to market. See the section titled Business Sales and Marketing. Strategic use of data optimizes customer enjoyment and Company profitability SGHC s strategic focus on data and analytics is embodied in the development of proprietary technology systems designed to leverage the large volumes of proprietary data that SGHC collects and analyses on a daily Table of Contents EXPLANATORY NOTE On April 23, 2021, Sport Entertainment Acquisition Corp., a Delaware corporation, entered into a Business Combination Agreement with SGHC Limited, a non-cellular company limited by shares incorporated under the laws of the Island of Guernsey, Super Group (SGHC) Limited, a non-cellular company limited by shares incorporated under the laws of the Island of Guernsey, Super Group (SGHC) Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Super Group, and Sports Entertainment Acquisition Holdings LLC, a Delaware limited liability company. The Company was incorporated on March 29, 2021 for the purpose of effectuating the Business Combination described herein. Prior to the Business Combination, the Company had nominal assets and liabilities, contingencies, or commitments, and did not conduct any operations other than costs incurred to acquire 100% of the equity interests of SGHC Limited and to effect the Business Combination. Following these exchanges, SGHC Limited became a wholly-owned subsidiary of the Company. Accordingly, the financial statements of the Company for the period from March 29, 2021 through December 31, 2021 have been included in this prospectus. The Business Combination was first accounted for as a capital reorganization whereby the Company is the successor to its predecessor SGHC. As a result of the first step described above, the existing shareholders of SGHC continued to retain control through ownership of the Company. The capital reorganization was immediately followed by the acquisition of SEAC, which was accounted for within the scope of International Financial Reporting Standards ( IFRS ) 2, Share-based Payments ( IFRS 2 ). Under this method of accounting, SEAC was treated as the acquired company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of the Company issuing ordinary redeemable shares of Super Group, of no par value for the net assets of SEAC, accompanied by a recapitalization. Pursuant to the Business Combination Agreement, prior to the closing of the Business Combination, SGHC underwent a pre-closing reorganization (the Reorganization ) wherein all existing shareholders of SGHC exchanged their shares in SGHC for Super Group ordinary shares. As described in the Business Combination Agreement, effective immediately following and conditioned upon the Closing, Super Group purchased Super Group ordinary shares from certain Pre-Closing Holders in exchange for cash consideration equal to $10.00 per Super Group ordinary share. Pursuant to the Business Combination Agreement, subject to the satisfaction or waiver of certain conditions set forth therein, the following has occurred: (a) SEAC s issued and outstanding Class B Shares, subject to the terms of the Founder Holder Consent Letter (as defined and described below), have converted automatically on a one-for-one basis into Class A Shares; and (b) Merger Sub has merged with and into SEAC, with SEAC continuing as the surviving company, as a result of which (i) SEAC has become a wholly-owned subsidiary of Super Group; (ii) each issued and outstanding unit of SEAC, consisting of one Class A Share and one-half of one warrant (the SEAC warrants ), were automatically detached, (iii) each issued and outstanding Class A Share was converted into the right to receive one Super Group ordinary share; and (iv) each issued and outstanding SEAC warrant to purchase a Class A Share have become exercisable for one Super Group ordinary share. The Business Combination was consummated on January 27, 2022. Certain amounts that appear in this prospectus may not sum due to rounding. Table of Contents basis. These systems and this data collection and analysis are designed to operate in conjunction with all of the Company s product platforms, regardless of whether the latter are proprietary or supplied by third parties. See the section titled SGHC s Technology and Data-Driven Approach. These systems aim to analyze and understand customer behaviors in as close to real-time as possible. Using this intelligence, the Company aims to responsibly and profitably optimize customer enjoyment and longevity via interactions, interventions and recommendations delivered as close to real-time as possible, to minimize fraud and other financial risks to the Company, and to meet the Company s regulatory and compliance requirements as efficiently and effectively as possible. Strategic technology selection maximizes speed-to-market, geographic expansion and competitive advantage The Company s customer-facing product technology decisions are governed by management s belief that product selection for new markets must seek to optimize speed-to-market, product-market fit and competitive advantage. Elsewhere and wherever commercially possible, the Company seeks to use technology for competitive advantage, particularly with regards to anything related to data and analytics. Diversification and visibility The Company s strategy of expanding into as many regulated markets as possible has resulted in having gaming licenses in 24 diverse jurisdictions, excluding up to 12 jurisdictions in which DGC USA has obtained initial market access deals in the United States, and additional states and jurisdictions for which it is currently applying for or negotiating licenses. Management believes that such diversification is key to good future revenue and profit visibility. The Company s teams in 23 countries around the world ensure a natural degree of protection for the Company against natural disasters, geopolitical risks or other potential operational disruptions. With licenses and access in additional jurisdictions and U.S. states currently being applied for or negotiated, management believes that the Company s diversification and revenue and profits visibility will continue to improve. See Risk Factors Litigation and Regulatory Risks Our growth prospects and market potential will depend on our ability to obtain licenses to operate in a number of regulated jurisdictions and if we fail to obtain such licenses our business, financial condition, results of operations and prospects could be impaired. Global expansion, local focus The Company approaches each market individually, tailoring product, staffing and marketing decisions to meet local conditions. In some countries, dedicated in-country staff are employed in order to coordinate jurisdiction-specific marketing campaigns and for local operational or other purposes, including 24/7/365 customer service, production of local content for customer engagement, locally relevant branding and marketing campaigns, acquisition of local payment processing mechanisms, and engagement with local social responsibility and community upliftment organizations. Worldwide, the Company s sportsbook trading team of 120 employees benefits from long-term relationships with third-party technology providers. Across Africa, the Company employs an operational team of approximately 600 employees to develop, expand and operate the Company s proprietary sportsbook and purpose-built African market platform. Proven ability to launch and scale new markets quickly A typical entry into a new market requires an upfront capital investment that will vary depending on how much customization is required for compliance with local regulatory and other conditions. In addition, some Table of Contents CONVENTIONS WHICH APPLY TO THIS PROSPECTUS AND EXCHANGE RATE PRESENTATION In this prospectus, unless otherwise specified or the context otherwise requires: $, USD and U.S. dollar each refer to the United States dollar; , GBP and pounds each refer to the British pound sterling; and , EUR and Euro each refer to the Euro. Certain amounts described herein have been expressed in U.S. dollars for convenience, and when expressed in U.S. dollars in the future, such amounts may be different from those set forth herein due to intervening exchange rate fluctuations. The exchange rate used for conversion between U.S. dollars and pounds is based on the historical exchange rate of the pound released by the Federal Reserve, the central bank of the United States. TRADEMARKS, TRADE NAMES AND SERVICE MARKS SGHC, the Company, Merger Sub, SEAC and their respective subsidiaries own or have rights to trademarks, trade names and service marks that they use in connection with the operation of their businesses. In addition, their names, logos and website names and addresses are their trademarks or service marks. Other trademarks, trade names and service marks appearing in this prospectus are the property of their respective owners. Solely for convenience, in some cases, the trademarks, trade names and service marks referred to in this prospectus are listed without the applicable , and SM symbols, but such references are not intended to indicate, in any way, that we or the owners thereof will not assert, to the fullest extent under applicable law, our or their rights to these trademarks, trade names and service marks. MARKET AND INDUSTRY DATA In this prospectus, we present industry data, information and statistics regarding the markets in which Super Group competes, as well as statistics, data and other information provided by third parties relating to markets, market sizes, market shares, market positions and other industry data (collectively, Industry Analysis ). Such information is supplemented where necessary with Super Group s internal estimates, taking into account publicly available information about other industry participants and the judgment of Super Group s management where information is not publicly available. This information appears in Business and other sections of this prospectus. Industry publications, research, studies and forecasts generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward-looking statements in this prospectus. These forecasts and forward-looking information are subject to uncertainty and risk due to a variety of factors, including those described under Risk Factors. These and other factors could cause results to differ materially from those expressed in any forecasts or estimates. Table of Contents markets are more restrictive and/or more specific in their regulation than other markets which can increase the amount of time required until full integration is achieved. However, SGHC has proven its ability to enter and profitably launch in new markets despite varying integration times. For example, within 24 months of the April 2018 commencement of marketing in one new African market, revenue grew by 16.5 times from approximately $145,000 at the outset to $2.35 million GGR per month and has continued to grow since. During the same period, first time depositors increased by 12.6 times. Similarly, in another new market in Europe (non-English-speaking, highly competitive), marketing commenced in September 2018, resulting in 10.3 times growth in revenue over the following 24 months from approximately $175,000 to $1.75 million GGR per month. During the same period, first time depositors increased by 13.6 times. Management believes that these results are indicative of the global strength of the Betway brand. In effect, management s belief is that Betway s global brand presence creates latent demand within new markets owing to the fact that even prior to Betway s entry into a market it will be well-known to potential customers by virtue of the wide range of partnerships and sponsorships that the Betway brand engages in around the world. Management further believes that SGHC s results to date are evidence that this latent demand can be successfully leveraged by proven marketing strategies (see Business Sales and Marketing ), flexible and pragmatic technology selection (see SGHC s Technology and Data-Driven Approach ) and, where necessary, in-country focused teams with local skills and knowledge. Shared centers of operational excellence and operational economies of scale Whereas management believes that marketing, product and customer service often require a significant degree of localization, other areas within the business are expected to benefit from centralization and economies of scale. Examples of this include technology and software, data and analytics, payment processing, fraud detection, compliance and risk management. Certain aspects of marketing, product and customer service are also believed to be best centralized, albeit with careful consideration of how not to inhibit regional innovation, quality and delivery. SGHC aims to strike a considered balance between centralization and distributed localization to achieve optimal customer service, effective overall delivery and meaningful economies of scale, all in service of continued growth and optimal long-term expected returns to shareholders. Responsible Gaming SGHC views responsible gaming as both a challenge and an opportunity, and ultimately as a barrier to entry and a source of competitive advantage. The challenge of meeting regulatory requirements in a commercially prudent and effective manner is clear. Management believes that SGHC has thus far been successful in meeting this challenge, as evidenced by the 24 licensed jurisdictions that the Company already holds licenses in. The opportunity arises from the Company s view that attempting to meet the betting and gaming entertainment needs of customers in a responsible manner will ultimately lead to more satisfied customers, which in turn will generate more sustainable and more stable revenues, and hence better long-term visibility of revenues and profits. As the sports betting and online casino gaming business has matured over time, naturally the level of complexity in the business has increased. This is in part due to some significant variation in regulations in Table of Contents different jurisdictions that have in aggregate created natural barriers to entry. Smaller operators have increasingly struggled to survive the demands of growing operational complexity, which management believes has contributed in part to recent consolidation within the industry. Management believes that SGHC s shared centers of operational excellence and economies of scale in conjunction with a strategic focus on data, analysis and timeous customer interaction (see the section titled SGHC s Technology and Data-Driven Approach ) create a significant competitive advantage for SGHC. SGHC s ability to gather and analyze data regarding customer behaviors and experience both enables the provision of an individualized experience to customers as well as real-time identification of potential problem gaming or risk of harm. As set out further in the section titled SGHC s Technology and Data-Driven Approach , the Company employs numerous real-time interventions when appropriate to do so and subject to relevant regulation. Management experience SGHC s CEO, Neal Menashe, has more than two decades of experience in the sports betting and online casino gaming industry. The Company s President and COO, Richard Hasson, has more than 12 years of experience in investment banking, sports betting and online casino gaming. The Company s CFO, Alinda van Wyk, also has more than two decades of experience in the financial management of sports betting and online casino gaming businesses. The Company benefits from a deep bench of professionals in its management team with significant experience, either with the Company, or in the industry. Strategy, Products and Business Model Strategy SGHC s diagnosis of the key challenges and opportunities in the global online gaming market follow from the Company s belief that: Over time a significant additional number of jurisdictions will regulate sports betting and/or online casino gaming. Jurisdictions which explicitly regulate sports betting and/or online casino gaming will become easier to market in at scale, but simultaneously will likely become more competitive, in which case brand strength will become an important determinant of success. Jurisdictions which have not yet introduced explicit regulatory frameworks may still be legal to operate in (subject to certain limited regulations), but marketing at scale may be harder to achieve, in which case a portfolio of brands will be a significant asset. In order to address these challenges, the Company s three key strategies serve as its guiding policies that govern everything that the Company does. 1. Expanding its global footprint into as many regulated markets as possible in order to engage with as many customers as it can possibly reach; 2. Increasing awareness of its brands through strategic partnerships and coordinated sponsorship and marketing campaigns; and 3. Utilizing enhanced proprietary data to optimize the confluence of ethical corporate culture, responsible gaming values, value-for-money product offerings and customer-centric service delivery. The Company believes that maximum value for shareholders will be delivered by seeking to operate in as many different jurisdictions as it is legal and commercially viable to do so, and that it is imperative that the Company seeks to continue its expansion into and growth in jurisdictions where robust regulatory frameworks provide long-term visibility of revenues and profits. Table of Contents The Company further believes that a single-brand online sports and multi-brand online casino strategy is the optimal way to leverage its available marketing budget. Given the Company s belief that over time more and more jurisdictions will regulate sports betting and/or online casino gaming, this strategy aims to generate increasing economies of marketing scale, improved global brand awareness, increasing market share and ultimately enhanced returns to shareholders. Proprietary, bespoke and common technology stacks and service infrastructures are leveraged where the Company believes that it makes commercial sense to do so, whilst third-party products and services are incorporated where the Company believes that doing so will achieve market entry faster, more effectively and more profitably. The Company aims to layer its proprietary data collection and analysis, together with proprietary interaction systems, on top thereof so as to responsibly optimize the entertainment, well-being and profitability of its customers. See SGHC s Technology and Data-Driven Approach for further detail. For strategic reasons set out below, the Company has intentionally set out to differentiate the Betway and Spin product offerings and business models. Betway s sports betting products Betway is positioned as a premium sportsbook that offers full-featured sports betting products for pre-game and in-game wagering. Different products and/or features are offered in different geographic markets depending on regulatory constraints, product availability, market maturity and strategic value of the market. Betway s flagship sports betting product is bespoke-developed exclusively for Betway (see the sections titled SGHC s Technology and Data-Driven Approach and Partnerships, Suppliers and Strategic Collaborations ) and is currently capable of accepting wagers on more than 60 different sports. This product is offered in the majority of the relatively mature markets in which Betway operates, such as the UK and most European markets. For other markets, the Company has developed a proprietary sports betting platform that it will aim to re-use where appropriate. The global sports betting market is constantly evolving and new markets are regulating or re-regulating all the time, often with very specific and sometimes complex regulatory requirements that require significant development work in order to achieve compliance. For this reason, even the world s largest sports betting businesses struggle to keep pace with adapting their existing products for regulatory compliance and/or product and cultural requirements of new markets. Accordingly, in addition to the exclusive flagship sportsbook and the proprietary sportsbook platforms, in some new markets (particularly those where the proprietary and flagship products are not yet customized for specific local regulations), the Company may partner with additional third-party product providers in order to minimize delays to market entry. Betway s online casino gaming products Betway s sports-led marketing places sports betting products front and center to reinforce the brand s premium sportsbook positioning. A significant percentage of sports betting customers nonetheless also enjoy casino gambling and hence Betway also offers casino games in those jurisdictions where regulatory frameworks allow. Slightly differing products may be offered in different jurisdictions depending on regulatory requirements and product availability. Casino games are sourced from third-party suppliers selected for their appropriateness for each market. Currently, Betway offers in excess of 1,350 unique casino games from 28 different suppliers. Table of Contents Spin s multiple online casino gaming brands Spin operates a portfolio of more than 20 brands, the majority of which are translated into multiple languages and offer customers the ability to play in excess of 1,400 online casino games from seven different suppliers. The five largest brands accounted for 94% of Spin s revenue in 2021. In markets where the regulatory framework permits and where SGHC believes there is strategic value in doing so, Spin also offers ancillary sport betting products, typically sourced from third-party suppliers. In contrast with Betway s single-brand scale-marketing approach, Spin seeks to compete in markets where marketing at scale is often much harder, and hence where a large portfolio of brands and a diverse product range offers Spin the ability to attract a wider variety of customers than a single brand would be able to do in the absence of meaningful large-scale marketing. Management believes that the effectiveness of this strategy is further enhanced by a wide variety of marketing channels (see Business Sales and Marketing ). Worldwide, Betway and Spin products are available for play in 40 different currencies and customers are serviced in 27 different languages. In aggregate, SGHC offers its customers in excess of 1,900 unique online casino games. SGHC s Technology and Data-Driven Approach SGHC manages over 1,000 technology-focused staff to support and enhance its product offerings. Teams are grouped into product-focused and system-oriented portfolios aimed at driving effective ownership of solutions and enabling efficient delivery and scaling. Teams are responsible for their own plans in support of SGHC s strategy, derived from a combination of customer requirements, regulatory frameworks, competitor analysis, product performance metrics and hypothesis-driven engineering. In combination, this approach aims to maximally optimize SGHC s technology flexibility, functionality, delivery, reliability and competitive edge. Operationally, SGHC embraces DevOps principles, including continuous delivery of systems aimed at minimizing deployment pain and maximizing end-user trust and confidence. Information security is assigned a very high priority by the Company. Key subsidiaries involved in the handling of sensitive information are either already ISO 27001 certified or are actively working towards being certified. Where the latter is the case, management is satisfied that relevant and necessary processes, systems and practices are already substantially in place. With particular reference to customer-facing products, SGHC operates a mix of its own technology and long-term partnerships with leading third-party providers (see the section titled Partnerships, Suppliers and Strategic Collaborations ), a flexible approach that is intended to increase speed to market and decrease friction associated with adjusting the technology stack to new markets. In other non-customer-facing areas of technology, SGHC may utilize the products and services of third-party suppliers, in particular where management does not believe that competitive advantage will be served by developing proprietary technology or where it might not be commercially prudent to do so. However, in areas where management believes that meaningful competitive advantage can be profitably achieved, the Company Table of Contents will seek to develop and maintain its own proprietary technology. Where systems are intended to deliver competitive advantage, the Company will seek to ensure interoperability with all of its product platforms, including those supplied by third parties. Some examples of this are highlighted below. Overall, SGHC s approach to technology can broadly be divided into three areas: Customer-facing products and platforms SGHC s proprietary sportsbook product is offered by Betway in the majority of African countries in which the Company is licensed. With this notable exception, in most jurisdictions the major components of customer-facing sports betting and online casino gaming products are sourced from third-party suppliers. Notwithstanding this, the Company always seeks to be highly involved in the specification and customization of third-party product and generally works in close collaboration with all of its suppliers. This is particularly true of the Company s relationship with Apricot, which provides Betway s bespoke-developed flagship sports betting system on an exclusive-use basis as well as the Player Account Management ( PAM ) system utilized for the majority of SGHC s operations. Apricot also provides a significant portion of the casino games offered by Betway and Spin (see the section titled Partnerships, Suppliers and Strategic Collaborations ). Data and related systems SGHC seeks to derive significant competitive advantage from its proprietary data by collecting granular detail regarding all steps in the customer lifecycle, always within the constraints of relevant data protection legislation. In particular, once customers commercially engage with one of the Company s brands, then significant amounts of proprietary data regarding wagering and other product interactions will be collected and made available downstream for real-time analysis and decision-making. Proprietary real-time systems transform and analyze this data in order to understand each individual customer experience within SGHC s products. The Company utilizes this information (in real-time where appropriate) to maximize customer value and enjoyment in a safe and responsible manner. Dedicated customer experience teams aim to measure and monitor all points of interaction and all steps in the customer journey with the ultimate aim of minimizing friction and maximizing customers ease of use of the Company s products. The Company maintains a range of highly-engineered proprietary systems for the complex processing of millions of events per day in order to deliver bespoke customer experiences that react dynamically to individual customer behavior. Examples of real-time interventions generated in this way include: Betting Behavior: The Company aims to monitor and analyze customer behavior in real-time with the intention of detecting unsustainable or potentially harmful deviations in betting behavior so that in turn the Company can attempt to intervene appropriately and timeously. In addition to being a requirement of regulatory responsible gaming obligations in several jurisdictions, the Company believes that interventions of this nature ultimately generate more satisfied and sustainable customers, improved retention rates, and longer customer lifecycles, thereby enhancing customer lifetime values. Personalized Wagering Recommendations: Seeking to understand individual customer preferences and attributes in combination with machine learning and data science in turn generates personalized wagering recommendations that aim to remove user interface friction and increase customer satisfaction and enjoyment. Individual Profitability Analysis and Personalized Incentivization: The Company employs statisticians and data scientists to model and validate the expected profitability of short-, medium- and long-term Table of Contents customer behavior with reference to a range of activities and metrics. The Company believes that these models enable it to profitably and responsibly incentivize and/or encourage (or discourage, as the case may be) specific behaviors, which the Company attempts to do in real-time. The Company believes that these models and associated interventions in aggregate form a significant competitive advantage that generates more satisfied and sustainable customers, improved retention rates, and longer customer lifecycles, thereby enhancing customer lifetime values. Monitoring and Mitigation of Potentially Fraudulent Activities: Similar models and systems seek to identify potentially fraudulent or otherwise problematic activity in real-time and thereby aim to limit the potential financial harm and/or regulatory risk to the business. For all of the above examples, the Company seeks to ensure that the relevant systems are capable of processing data from all of its product platforms, including those supplied by third parties, and that customer interactions and interventions can be executed on all of its product platforms, including those supplied by third parties. The Company s analysis and data science capabilities are also applied in the acquisition of new customers, for example, by adapting marketing and related campaigns for specific markets, channels and marketing partners. Where possible and in collaboration with third party marketing technology providers, the Company employs real-time bidding, spend and allocation optimization algorithms in conjunction with dynamic creative optimization and personalized messaging, all with the intention of reducing the cost of acquiring new customers. Where possible the Company s marketing spend is tracked and measured, with the aim of enabling the Company to react quickly to changes in the expected profitability of marketing channels. For large branding and sponsorship campaigns, where lead times can be long and performance measurement is as much art as science, the Company s annual marketing budgets and plans are optimized by reference to complex econometric models, cross-referenced and validated against proprietary and third-party data with the aim of optimizing efficiencies throughout the marketing funnel. Budget proposals and other relevant expected operational factors are then fed into a detailed actuarial model of the business that projects expected financial results for Betway and Spin separately for all major markets. These results are then aggregated and evaluated to ensure the financial soundness of the Company s plans under a range of potential scenarios. This model is updated regularly throughout the year for financial management and monitoring purposes and is also employed for audit and regulatory requirements. Other enabling platforms and shared services Over time, the Company has developed a wide range of proprietary systems for enabling the operational effectiveness of the business, including in the areas listed below. In all cases the Company aims to continuously evolve and improve its systems over time. Acquisition Marketing Systems Proprietary models in combination with third party systems and tools are maintained for the deployment, management, measurement and monitoring of customer acquisition campaigns across a variety of marketing channels (see Business Sales and Marketing ). Responsible Gaming Systems The Company has developed various systems with the intention of meeting the Company s regulatory requirements for customer protection against risk of harm from gambling. Certain related products and systems provided by third-party suppliers are also integrated into the Company s responsible gaming processes. Table of Contents Customer Retention Systems The Company maintains a number of proprietary systems aimed at ensuring the profitable retention of customers and also makes use of certain third-party systems and components as part of its customer retention processes. The Company believes that maximizing customer lifetime value over the long-term is only possible when responsible gaming principles are adhered to. Accordingly, customer retention systems are generally closely integrated with or otherwise share significant components with responsible gaming systems. Messaging and Communications Systems The Company believes that customer satisfaction is underpinned by an ability to deliver the right message to the right customer at the right time and has therefore developed proprietary software systems (some of which are integrated into third-party supplier systems) for messaging and communicating with customers in-app, in real-time, as well as other related systems for doing so by other mechanisms and at different times. These systems are crucial for the effective delivery of responsible gaming and retention interventions. Banking and Finance Systems A dedicated subsidiary is responsible for ensuring that the Company is able to offer customers a range of mechanisms for deposit and withdrawal of funds in each of the markets that the Company operates in. Currently, the Company offers well in excess of 100 different deposit and withdrawal mechanisms worldwide. Related systems ensure that necessary financial data is made available downstream for financial management and reporting purposes. The Company develops and maintains automated reporting and reconciliation systems and processes to allow for the production of internal management accounts (including monthly unaudited financial statements produced separately for each entity in each jurisdiction) within a few weeks of month-end and audited financial statements within a few months of year-end. Risk, Fraud and Compliance Systems The Company encounters sophisticated attempts at fraud on a regular basis and is required to verify customers and their source of funds in accordance with varying regulations in each jurisdiction. Significant customer volumes (an average of more than 2.8 million customers per month over the twelve months of 2021) mean that systems for the detection and prevention of attempted fraud and ensuring compliance with know your customer and anti-money laundering regulations must be substantially automated. In addition to rules-based systems that codify the Company s 20+ years of experience in combating fraud, managing risk and ensuring compliance, the Company also expends considerable effort in the development of new systems for this purpose, including the employment of machine learning and other data science techniques. Managing Wagering Risk The Company manages its own teams of experienced traders to set and maintain sports betting odds. These teams use their own expertise and internal pricing models in conjunction with external data feeds, odds monitoring services and various competitive factors to derive opening prices for each market. Thereafter, prices will be adjusted based on news events of relevance to the market, as well as wagers placed by customers and competitive forces. The Company cannot guarantee that it is capable of always offering the best price in all markets at all times, but continuously strives to remain competitive and offer customers attractive value for their money. Various systems are deployed to measure and monitor the margin on the sportsbook, which is the percentage of wagers that the book is expected (in terms of the Company s pricing models) to win on average over a Table of Contents particular period of time. Individual customer wagering is also closely monitored and alerts are raised for wagering activity considered unusual. In particular, evidence of potentially illegal or collusive behavior (such as suspicion of match-fixing) will be shared with the necessary legal and/or sporting authorities. Where appropriate, customers will be limited by reference to maximum wager size and/or wager type. The Company s products currently support wagering on more than 60 different sports, each of which in turn encompasses a wide range of events and outcomes that can be wagered on (also referred to as betting markets ) both pre-game and in-game. The Company actively seeks to add additional betting markets, both for purposes of customer enjoyment and Company financial benefit, including diversification of risk, reduction of margin volatility and increased profitability. For online casino games, the Company seeks to offer an entertaining range of games with value-for-money return to player ( RTP ) and (for slot games in particular) entertaining volatility ( Vx ) characteristics. RTP measures the expected return to customers as a percentage of wagers while Vx is a measure of the expected variance thereof. Most notably for slot games, customers have varying individual preferences for volatility and hence the Company attempts to recommend games to customers that are appropriate given their preferences. Game suppliers may offer games in multiple variants with differing combinations of RTP and Vx, in which case the Company seeks to ensure that it selects only those variants which it believes will optimize both value-for-money entertainment for its customers and long-term profitability for the Company. A necessary requirement for successful management of wagering risk is appropriate control of customer incentivization. Without suitable systems and controls for customer incentives it is possible for wagering opportunities to arise that are mathematically unprofitable for the Company. Examples include arbitrage of sports wagers and situations where adroit betting with incentive funds can create expected RTP in excess of 100% for casino games. The Company believes that optimal individual customer evaluation and incentivization (see the paragraph Individual Profitability Analysis and Personalized Incentivization in the section titled SGHC s Technology and Data-Driven Approach above) will largely obviate this potential problem but, where this is not the case, the Company has many years of experience in detecting and preventing such situations and maintains a number of proprietary systems with the intention of doing so. Partnerships, Suppliers and Strategic Collaborations SGHC engages in long-term partnerships, including with leading third-party technology providers which, together with the Company s own technology, increases the speed with which its offerings are brought to market and decreases the friction associated with adjusting its technology to new markets. Relationship with Apricot SGHC has entered into several software and services agreements with Apricot (and its affiliates and subsidiaries), one of the leading gaming software and content providers, including casino software licensing agreements, jackpot services and licensing agreements and sportsbook software licensing agreements. Through these agreements, SGHC engages members of the Apricot group for the provision of the Apricot group s sportsbook and PAM software systems in a number of SGHC s most significant markets. It is noted that Mr. Martin Moshal is the named individual beneficiary of certain trusts, which trusts are the ultimate controlling shareholders of Apricot and also the named individual beneficiary of a further trust that ultimately controls Knutsson Limited, a major shareholder of SGHC. A beneficiary of these trusts has neither any right to control or voting investment power over the trusts, nor does it have the right to appoint or replace the trustees. Table of Contents Casino Software Licensing Agreements Pursuant to various casino software licensing agreements entered into by subsidiaries of SGHC, SGHC has been granted non-exclusive software licenses for use of a suite of gaming software in different territories in which SGHC operates. Several of the agreements permit the advertising, marketing and promotion of the software suite in each respective territory and certain of the agreements allow for the licensee to sub-license the use of the system. As at March 15, 2022, subsidiaries of SGHC had entered into seven casino software licensing agreements with affiliates of Apricot. The term and termination provisions of the casino software and licensing agreements are summarized as follows. The initial term of all casino software licensing agreements with Apricot expires on December 31, 2035. Under all these agreements, termination for convenience by either party is not possible until expiry of the initial term and then must be on not less than 12 months written notice, although one casino software licensing agreement with Apricot does not permit termination for convenience at all, allowing only for termination in accordance with its terms (as summarized in the remainder of this paragraph) after December 31, 2035. A party may also unilaterally terminate the relevant agreement in the event that the other party (a) breaches a material obligation or undertaking under such agreement and which, where such breach is capable of remedy, is not remedied within the specified timeframe to the reasonable satisfaction of the other party; or (b) suffers an insolvency event. In a number of the agreements, a party may terminate for change of control when control of the other party is obtained by a competitor. The Apricot company in the relevant agreement may unilaterally terminate such agreement in the event the relevant SGHC subsidiary (a) fails to pay monies to as they fall due under the agreement; (b) uses the software system illegally; (c) markets a branded game without Apricot s consent; (d) fails to notify Apricot of a change in control of such party; (e) breaches non-solicitation, non-competition or data protection obligations; (f) is convicted (or any of its directors are convicted) of an offense in terms of any applicable gaming legislation or regulations, or of any crime or offense reasonably likely to cause reputational damage or damage to goodwill to Apricot; or (g) fails to procure the appropriate gaming license. In a number of the agreements: (i) Apricot may terminate the agreement if the relevant SGHC subsidiary: (a) provides false or inaccurate information which has an adverse effect on Apricot; (b) accepts a real money bet from end users located outside the appropriate territory or within the USA; (c) fails to pay the minimum agreed gaming fee; (d) becomes a competitor to Apricot; or (e) fails to pay its players or depositors within the specified time period; (ii) Apricot may terminate the agreement if it becomes unlawful or impossible for Apricot to license, maintain or use the system, or a court or arbitrator declares any provision of the agreement void or unenforceable; and (iii) the relevant SGHC subsidiary may terminate the agreement if Apricot (or any of its directors) are convicted of an offense in terms of any applicable gaming legislation or regulations, or of any crime or offense reasonably likely to cause reputational damage or damage to goodwill of the other. Jackpot Services and Licensing Agreements Various subsidiaries of SGHC have entered into jackpot services and licensing agreements with Jumbo Jackpots Limited, a wholly owned subsidiary of Apricot. Pursuant to these jackpot services and licensing agreements, Jumbo Jackpots Limited grants non-exclusive licenses of trademarks as supplied within the software licensed through separate casino software licensing agreements and provides services to enable the licensee to run jackpot games. As at March 15, 2022, subsidiaries of SGHC had entered into seven Jackpot Services and Licensing Agreements with Jumbo Jackpots Limited. The term and termination provisions of the jackpot services are summarized as follows. All jackpot services and licensing agreements have an indefinite term, and do not permit termination for convenience, except for one agreement which permits termination by either party on two months written notice. All of these agreements permit either party to terminate immediately by written notice if a petition or resolution is passed for the winding Table of Contents up of the other party. The agreements also terminate automatically if the applicable SGHC subsidiary s gaming license is withdrawn. Jumbo Jackpots Limited may terminate the agreement if any of the following events occur: (a) the other party commits a breach of the agreement and fails to remedy such breach within the specified time period; (b) the other party fails to pay sums as they fall due; (c) it becomes unlawful or impossible for Jumbo Jackpots Limited to license, maintain or use the relevant trademarks or provide the services under the agreement; (d) bankruptcy or insolvency proceedings are filed against the other party; (e) the other party can no longer perform its business activities or fulfil its commitments to Jumbo Jackpots Limited; or (f) the other party (or any other entity having common shareholders or control with that party) becomes a competitor to Jumbo Jackpots Limited. The counterparty may terminate the agreement with 14 days written notice if Jumbo Jackpots Limited raises the agreed service fee. In addition, each agreement automatically terminates on termination of the corresponding casino software licensing agreement between the SGHC subsidiary which is party to the relevant jackpot services and licensing agreement and Apricot or PNL or Kova (as defined below) as applicable, the termination provisions of which are summarized above. Sportsbook Software Licensing Agreement Through its subsidiary Betway Limited, SGHC engages in an agreement for the exclusive provision of Apricot s sportsbook software in a number of SGHC s most significant markets. This exclusive arrangement prevents Apricot from licensing its sportsbook software to any other customers in those jurisdictions, but does not prevent SGHC from utilizing its own or other suppliers sportsbook software where it chooses to do so. The agreement also permits the advertising, marketing and promotion of the software system in each respective territory. The term and termination provisions of the sportsbook software licensing agreement are summarized as follows. The initial term of the sportsbook software licensing agreement expires on December 31, 2030. Under this agreement, termination for convenience by either party is not possible until expiry of such initial term and thereafter must be on not less than 180 days written notice. Betway Limited may also terminate the agreement for convenience after December 31, 2025 with at least 18 months written notice. The agreement also permits either party to terminate by written notice if: (a) the other party is in breach of the agreement and, where such breach is capable of remedy, fails to remedy such breach within 30 days of notice to the reasonable satisfaction of the other party; (b) bankruptcy, insolvency or analogous proceedings are commenced against the other party; or (c) when control of the other party is obtained by a competitor (on 18 months written notice). SGHC works closely with Apricot and its affiliates in the ongoing development of the sportsbook product and the PAM system and the customization thereof for SGHC s needs. The Company has direct access to dedicated Apricot resources for this purpose and plays a meaningful role in the strategic direction and prioritization of these resources. Apricot supplies a significant portion of the casino games available for play across all SGHC websites and apps. Other significant online casino gaming software suppliers contracted directly and indirectly include IGT, Scientific Gaming and Evolution (including NetEnt and Red Tiger). Prima Networks Limited, Prima Networks Spain PLC and Kova SRL ( PNL/PNS/Kova ) similarly engage Apricot in agreements for the provision of Apricot s casino and sportsbook software. PNL/PNS/Kova sublicenses the Apricot software to subsidiaries of SGHC, such as Betway. As of March 15, 2022, PNL/PNS/Kova had entered into eleven casino software licensing agreements and five sportsbook software licensing agreements with subsidiaries of SGHC. The casino software licensing agreements and sportsbook licensing agreements entered into by subsidiaries of SGHC and PNL/PNS/Kova have term and termination rights which are materially similar to those applicable to the casino software licensing agreements and sportsbook licensing agreements with Apricot summarized above. Table of Contents Other Partnerships, Suppliers and Strategic Collaborations SGHC s Betway brand has engaged in key relationships (most of them multi-year) with professional sports teams and leagues around the world, starting with front of shirt sponsorship of the English Premier League s West Ham United in 2015. Subsequent partnerships have included several football (soccer) teams in other major European and African leagues, major horse racing events, eSports teams and events, major cricket leagues, tennis tournaments and sporting celebrities as brand ambassadors. Many of these arrangements have since been extended well beyond their original terms. Currently, more than 70 brand partnerships are in place with several more actively being negotiated. SGHC has continued this strategy during Betway s nascent expansion into the United States by engaging in similar partnerships with professional sports teams in the United States with global brand recognition, such as the Chicago Bulls, the Cleveland Cavaliers, the Los Angeles Clippers, the Golden State Warriors and the New York Islanders. These arrangements all serve to bolster Betway s global brand recognition. Management believes that over time this strategy has worked as a flywheel to progressively and more effectively amortize Betway s brand marketing spend, in part explaining improvements in Betway s growth and financial performance over recent years. SGHC benefits from a number of long-established affiliates marketing partnerships (see Business Sales and Marketing ) that have historically generated a stable and significant stream of new customers. SGHC enters into strategic, multi-year partnerships with land-based gaming operators in order to facilitate entry into markets where a land-based license or partner is prerequisite for market access. Examples include Casino Austria International Belgium NV and Espectaculos Deportivos Fronton Mexico S.A de C.V, both for access to sports betting and online casino gaming, in Belgium and Mexico respectively. SGHC enters into multi-year agreements with sports data suppliers for data to inform the Company s odds making and sports trading activities, as well as for content for the Company s websites and apps. Significant suppliers include SportRadar, BetGenius, Perform Content Limited, and IMG. Key summaries of these agreements are described below. SportRadar Agreements SportRadar is a leading information supplier for sport related data and statistics as well as sophisticated technical solutions. We have agreements, including four statements of work ( SOW ), with SportRadar as part of a global deal, which includes the Managed Trading Services platform for Betway Africa. These SOWs provide that SportRadar will supply products and services for its sports betting and sportsbook operation globally to Betway Limited, who can sublicense its rights to its affiliates. BetGenius Agreements BetGenius is a provider of sportsbook data, content, analysis tools, software and related services to sports betting operators worldwide. We have agreements in place between BetGenius and Betway Limited that allow Betway Limited and its affiliates to use BetGenius services through a non-exclusive, non-transferable non-sublicensable right and license. Perform Content Limited Agreements Perform owns, operates and provides video and consumer data services to betting operators throughout the world. We have four agreements in place with Perform, each for a different product. Each agreement is between Perform and Betway Limited and each provide access to SGHC and its brand license partners, where appropriate. Table of Contents IMG IMG is in the business of distributing sports information, data and statistics to third parties. Under our data subscription agreement, IMG agrees to license certain of its content to Betway Limited and provide related technical support services. The content provided under the agreement includes the ATP World Tour, the WTA Tour, the French Open, Wimbledon and the U.S. Open. The agreement also includes the consumption of IMG UFC and Golf scoreboards and data as well as streaming services. Recent Developments Business Combination On April 23, 2021, SGHC entered into the Business Combination Agreement with SEAC, the Company, SGHC Merger Sub, Inc., and Sports Entertainment Acquisition Holdings LLC. Pursuant to the Business Combination Agreement, prior to the closing of the Business Combination, SGHC underwent a pre+closing reorganization wherein all existing shareholders of SGHC exchanged their shares in SGHC for newly issued ordinary shares in the Company. SGHC is deemed the accounting predecessor and the combined entity is the successor registrant. The Business Combination closed on January 27, 2022. Financial Results for the Three Months Ended March 31, 2022 Revenue of 334.5 million up 7% period over period Loss after tax of 163.2 million includes 201.5 million of costs and changes in fair values associated with the business combination and listing as a public company Cash and cash equivalents of 272.7 million This unaudited financial information for the fiscal quarter ended March 31, 2022 is based upon our estimates. This financial information has been prepared solely on the basis of currently available information by, and is the responsibility of, management. The unaudited preliminary financial information for the fiscal quarter ended March 31, 2022 has not been reviewed or audited by our independent public accounting firm. This financial information is not a comprehensive statement of our financial results for this period. Our unaudited interim condensed consolidated statements of profit or loss and other comprehensive Income for the three months ended March 31, 2022 and 2021, unaudited interim condensed consolidated statement of financial position as of March 31, 2022 and unaudited interim condensed consolidated statements of cash flows for the three months ended March 31, 2022 and 2021 have been filed as an exhibit to the registration statement of which this prospectus forms a part. Grant of RSUs pursuant to the 2021 EIP On May 31, 2022 the Company granted and approved to grant up to a maximum of 6,699,900 RSUs pursuant to the 2021 EIP. Summary of Risk Factors Our business faces significant risks and uncertainties. You should carefully consider all of the information set forth in this prospectus and in other documents we file with or furnish to the SEC, including the following risk factors, before deciding to invest in or to maintain an investment in our securities. Our business, as well as our reputation, financial condition, results of operations and share price, could be materially adversely affected by any of these risks, as well as other risks and uncertainties not currently known to us or not currently considered material. These risks include, among others, the following: Our business depends on the success, including win or hold rates, of existing and future online betting and gaming products, which rely on a variety of factors and are not completely controlled by us. Table of Contents Competition within the broader entertainment industry is intense and our existing and potential customers may be attracted to competing betting and gaming options, as well as other forms of entertainment such as video games, television, movies and sporting events. If our offerings do not continue to be popular with existing customers and attract potential customers, our business would be harmed. COVID-19 has affected our business and operations in a variety of ways. The pandemic restrictions may have affected our business, financial condition, results of operations and prospects, including as a result of the reduction in the quantity of global sporting events, closures or restrictions on business operations of our suppliers, partners and sports organizations and a decrease in consumer spending, and it may continue to do so in the future. On the other hand, we cannot assure you that consumers will not decrease online gaming activities as pandemic restrictions are loosened. These cross-currents may have unknown and adverse effects that are impossible for us to predict. We rely on third-party service providers such as (i) third-party providers to validate the identity and identify the location of our customers, (ii) third-party payment processors to process deposits and withdrawals made by our customers into our platforms, (iii) third-party marketing and customer communications systems providers, (iv) third-party casino content, product and technology providers, (v) third-party sportsbook technology providers, (vi) third-party sports data providers for real-time and accurate data for sporting events, and (vii) third-party outsourced services providers, among others. If our third-party providers do not perform adequately or terminate their relationships with us, our costs may increase and our business, financial condition and results of operations could be adversely affected. We license the Betway brand, for a fixed fee, for use by DGC USA in the United States and, for a fixed fee plus an additional fee equal to a percentage of Betway s global brand marketing spend, to a third party for use in China and Thailand. A decline in such third-party operators financial performance or a termination of the brand licenses by such third parties could have an adverse effect on our business. If we fail to detect fraud or theft related to our offerings, including by our customers and employees, we will suffer financial losses and our reputation may suffer which could harm our brand and reputation and negatively impact our business, financial condition and results of operations and can subject us to investigations and litigation, which could ultimately lead to regulatory penalties, including potential loss of licensure. We rely on strategic relationships with land-based casinos, sports teams, event planners, local licensing partners and advertisers in order to be able to offer and market our products in certain jurisdictions. If we cannot maintain these relationships and establish additional relationships, our business, financial condition and results of operations could be adversely affected. The requirements of being a public company, including compliance with the requirements of the Sarbanes-Oxley Act and maintaining effective internal controls over financial reporting, may strain our resources and divert management s attention, and the increases in legal, accounting and compliance expenses associated with being a public company may be greater than we anticipate. As a private company, we were not required to document and test internal controls over financial reporting nor was our management required to certify the effectiveness of internal controls or have our auditors opine on the effectiveness of our internal control over financial reporting. Failure to maintain adequate financial, information technology and management processes and controls could result in material weaknesses which could lead to errors in our financial reporting, which could adversely affect our business as a public company. If our existing material weaknesses persist or we experience additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be Table of Contents able to accurately report our financial condition or results of operation, which may adversely affect investor confidence in us and, as a result, the value of our ordinary shares and our overall business. The gaming laws of different jurisdictions vary in both nature and application, and may be subject to alternate interpretations. Jurisdictions may or may not incorporate regulatory frameworks that provide a clear basis for the licensed provision of our gaming products and services to their residents. As a consequence, legal and enforcement risk may be unclear or uncertain in a number of the jurisdictions in which we operate and from which we generate a significant portion of our revenue, and there is a risk that regulators or prosecutors in these territories may seek to take legal action against us even in jurisdictions in which we believe our offerings are lawful based on advice from local counsel. Furthermore, we have in the past faced claims from customers contesting the legal basis of our services in certain jurisdictions, and may face similar claims again in the future. Failure to comply with legal or regulatory requirements in a particular regulated jurisdiction, or the failure to successfully obtain a license or permit in a particular jurisdiction, could impact our ability to comply with licensing and regulatory requirements in other regulated jurisdictions, or could cause the rejection of license applications or cancellation of existing licenses in other regulated jurisdictions, or could cause financial institutions, online and mobile platforms, advertisers and distributors to stop providing services to us which we rely upon to receive payments from, or distribute amounts to, our customers, or otherwise to deliver and promote our offerings. We are party to pending litigation and regulatory and tax audits in various jurisdictions and with various plaintiffs and we may be subject to future litigation and regulatory and tax audits in the operation of our business. An adverse outcome in one or more proceedings could adversely affect our business. Failure to protect or enforce our intellectual property rights, the confidentiality of our trade secrets and confidential information, or the costs involved in protecting or enforcing our intellectual property rights and confidential information, could harm our business, financial condition and results of operations. Our collection, storage and use, including sharing and international transfers, of personal data are subject to applicable data protection and privacy laws, and any actual or perceived failure to comply with such laws may harm our reputation and business or expose us to fines, civil claims (including class actions), and other enforcement action. The protection of personal information is becoming increasingly regulated and changes in applicable laws may require changes to our policies, practices, procedures and personnel which may require material expenditures and harm our financial condition and results of operations. We will rely on licenses to use the intellectual property rights of third parties which are incorporated into our products and offerings. Failure to maintain, renew or expand existing licenses may require us to modify, limit or discontinue certain offerings, which could adversely affect our business, financial condition and results of operations. We rely on information technology and other systems and platforms, and any failures, errors, defects or disruptions in our systems or platforms could diminish our brand and reputation, subject us to liability, disrupt our business, affect our ability to scale our technological infrastructure and adversely affect our operating results and growth prospects. Our games and other software applications and systems, and the third-party platforms upon which they are made available could contain undetected errors. Our internal forecasts are subject to significant risks, assumptions, estimates and uncertainties, including assumptions regarding future legislation and changes in regulations of the jurisdictions in which we operate, or seek to operate, our business. As a result, our projected revenues, market share, expenses and profitability may differ materially from our expectations. Table of Contents The coverage of our business or our securities by securities or industry analysts or the absence thereof could adversely affect our securities and trading volume. Because Super Group is incorporated under the laws of the Island of Guernsey, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. courts may be limited. Sales of our ordinary shares, or the perception of such sales, by us or the selling securityholders pursuant to this prospectus in the public market or otherwise could cause the market price for our ordinary shares to decline, even though the selling securityholders would still realize a profit on sales at lower prices. Selling Securityholders and Securities being Registered With respect to the securities being registered for resale by this prospectus, the Pre-Closing Holders exchanged their shares of SGHC for newly issued ordinary shares of the Company based on a valuation of $10.00 per ordinary share of the Company in connection with the Business Combination. However, the actual prices paid by the Pre-Closing Holders in connection with their acquisitions of SGHC shares were nominal. In addition, the Founder Holders (including PJT Partners Holdings LP, through its economic interest in the Sponsor) paid an aggregate of $25,000 for Class B Shares of SEAC, which converted into 11,250,000 Class A Shares of SEAC and then into an equal number of ordinary shares of the Company at the Closing. The Sponsor and PJT Partners Holdings LP paid $10,388,888 and $611,112 for 10,388,888 and 611,112 private placement warrants at a price of $1.00 per warrant, respectively, in a private placement simultaneously with the closing of the IPO as well as in connection with the closing of the partial exercise by the underwriters of their over-allotment option, with each such warrant entitling the holder thereof to purchase one ordinary share at a price of $11.50 per share. Therefore, after giving effect to the exchange of the SEAC ordinary shares for ordinary shares of the Company in the Business Combination, the Founder Holders paid an average price of approximately $0.002 per share for each ordinary share and $1.00 per private placement warrant for each warrant being offered by this prospectus. Given the substantial number of ordinary shares being registered for potential resale by selling securityholders pursuant to this prospectus, the sale of shares by the selling securityholders, or the perception in the market that the selling securityholders of a large number of shares intend to sell shares, could increase the volatility of the market price of our ordinary shares or result in a significant decline in the public trading price of our ordinary shares. Even if the prevailing market price of our ordinary shares is below the current trading price, the selling securityholders may still have an incentive to sell our ordinary shares because they purchased the shares at prices lower than the public investors or the current trading price of our ordinary shares. While the selling securityholders may experience a positive rate of return on their investment in our ordinary shares, public securityholders who purchased their ordinary shares at higher prices may not experience a similar rate of return. Based on the closing price of our ordinary shares of $4.36 as of July 5, 2022, the selling securityholders, if they sold all of the shares registered for sale by this prospectus, would experience a potential profit of up to approximately $2.09 billion in the aggregate. Corporate Information The legal name of the Company is Super Group (SGHC) Limited. The Company was incorporated under the laws of the Island of Guernsey as a non-cellular company limited by shares on March 29, 2021. The Company s registered office in Guernsey is Kingsway House, Havilland Street, St. Peter Port, Guernsey GY1 2QE. The address of the principal executive office of the Company is Super Group (SGHC) Limited, Bordeaux Court, Les Echelons, St. Peter Port, Guernsey, GY1 1AR, and the telephone number of the Company is +44 (0) 14 8182 2939. Table of Contents Investors should contact us for any inquiries through the address and telephone number of our principal executive office. Our principal website is https://www.sghc.com. The information contained on, or accessible from, or hyperlinked to, our website is not a part of this prospectus and you should not consider information on our website to be part of this prospectus. Implications of Being a Foreign Private Issuer We report under the Securities Exchange Act of 1934, as amended (the Exchange Act ), as a non-U.S. company with foreign private issuer status. As long as we qualify as a foreign private issuer under the Exchange Act we will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including, but not limited to: the rules under the Exchange Act requiring domestic filers to issue financial statements prepared under U.S. GAAP; the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specific information, or current reports on Form 8-K, upon the occurrence of specified significant events. We may take advantage of these exemptions until such time as we are no longer a foreign private issuer. We would cease to be a foreign private issuer at such time as (i) more than 50% of our outstanding voting securities are held by U.S. residents and (ii) any of the following three circumstances applies: (A) the majority of our executive officers or directors are U.S. citizens or residents, (B) more than 50% of our assets are located in the United States or (C) our business is administered principally in the United States. Foreign private issuers are also exempt from certain more stringent executive compensation disclosure rules. Thus, we will continue to be exempt from the more stringent compensation disclosures required of companies that are not foreign private issuers and will continue to be permitted to follow our home country practice on such matters. Table of Contents THE OFFERING Ordinary shares that may be offered and sold from time to time by the selling securityholders Up to 481,074,588 ordinary shares (including up to 11,000,000 ordinary shares that may be issued upon exercise of the private placement warrants). Warrants that may be offered and sold from time to time by the selling securityholders Up to 11,000,000 private placement warrants. Exercise price of Warrants $11.50 per share. Ordinary shares outstanding 490,197,468 ordinary shares. Use of proceeds All of the securities offered by the selling securityholders pursuant to this prospectus will be sold by the selling securityholders for their respective accounts. We will not receive any of the proceeds from such sales. We will pay certain expenses associated with the registration of the securities covered by this prospectus, as described in the section titled Plan of Distribution . However, we may receive up to an aggregate of $126,500,000 from the exercise of warrants for the ordinary shares being offered by the selling securityholders in this prospectus, assuming the exercise in full of all such warrants for cash at an exercise price of $11.50 per ordinary share for private placement warrants, respectively. The exercise price exceeds the current trading price of the ordinary shares and, therefore, there can be no assurance that such warrants will ever be exercised for cash. If the trading price for our common stock is less than $11.50 per share, we believe holders of our warrants will be unlikely to exercise their warrants. We intend to use the net proceeds from any cash exercise of such warrants for general corporate purposes. See Use of Proceeds. Dividend policy We have not paid any cash dividends on our ordinary shares to date. The Super Group Board intends to evaluate adopting a policy of paying cash dividends. In evaluating any dividend policy, the Super Group Board must consider Super Group s financial condition and may consider results of operations, certain tax considerations, capital requirements, alternative uses for capital, industry standards and economic conditions. Whether Super Group adopts such a dividend policy and the frequency and amount of any dividends declared on the Super Group ordinary shares will be within the discretion of the Super Group Board. See Dividend Policy. Table of Contents NYSE listing symbol Our ordinary shares and public warrants are currently listed on the NYSE under the symbol SGHC and SGHC WS, respectively. Risk factors See Risk Factors and the other information included in this prospectus for a discussion of factors you should consider before deciding to invest in our ordinary shares. Unless we specifically state otherwise or the context otherwise requires, the share information in this prospectus is as of March 31, 2022, and excludes: 22,500,000 of our ordinary shares issuable upon the exercise of public warrants outstanding as of March 31, 2022; 11,000,000 of our ordinary shares issuable upon the exercise of private placement warrants outstanding as of March 31, 2022; 43,312,150 of our ordinary shares reserved for future issuance under the 2021 Equity Incentive Plan as of March 31, 2022. See Management Compensation The 2021 Equity Incentive Plan ; and 4,812,460 of our ordinary shares reserved for future issuance under the 2021 Employee Stock Purchase Plan as of March 31, 2022. See Management Compensation The 2021 Employee Stock Purchase Plan. Table of Contents
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/SYM_symbotic_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SYM_symbotic_prospectus_summary.txt
new file mode 100644
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--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information included in this prospectus and does not contain all of the information that may be important to you. You should read this entire document and its annexes and the other documents to which we refer before you decide to invest in our securities. About Symbotic Symbotic s vision is to make the supply chain work better for everyone. It does this by developing, commercializing, and deploying innovative, end-to-end technology solutions that dramatically improve supply chain operations. Symbotic currently automates the processing of pallets and cases in large warehouses or distribution centers for some of the largest retail companies in the world. Its systems enhance operations at the front end of the supply chain, and therefore benefit all supply partners further down the chain, irrespective of fulfillment strategy. Background As previously announced, on December 12, 2021, SVF Investment Corp. 3 ( SVF 3 and, after the Domestication as described below, Symbotic or the Company ), a Cayman Islands exempted company incorporated with limited liability, entered into an Agreement and Plan of Merger (the Merger Agreement ) with Warehouse Technologies LLC, a New Hampshire limited liability company ( Warehouse ), Symbotic Holdings LLC, a Delaware limited liability company ( Symbotic Holdings ) and Saturn Acquisition (DE) Corp., a Delaware corporation and wholly owned subsidiary of SVF 3 ( Merger Sub ). On June 7, 2022, as contemplated by the Merger Agreement and the Agreement and Plan of Merger, dated December 12, 2021, by and between Warehouse and Symbotic Holdings (the Company Merger Agreement ), and as described in the section titled The Business Combination beginning on page 228 of the final prospectus and definitive proxy statement, dated June 1, 2022 (the Proxy Statement/Prospectus ) filed with the U.S. Securities and Exchange Commission (the SEC ), Warehouse merged with and into Symbotic Holdings, with Symbotic Holdings surviving the merger ( Interim Symbotic ). Immediately following such merger, on June 7, 2022, as contemplated by the Merger Agreement, SVF 3 filed a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filed a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which SVF 3 was transferred by way of continuation from the Cayman Islands and domesticated as a Delaware corporation, changing its name to Symbotic Inc. (the Domestication ). As a result of and upon the effective time of the Domestication, among other things, each of the then-issued and outstanding Class A ordinary shares, par value $0.0001 per share, of SVF 3 ( SVF Class A Ordinary Shares ) automatically converted, on a one-for-one basis, into a share of Class A Common Stock, par value $0.0001 per share, of Symbotic ( Class A Common Stock ), and each of the then-issued and outstanding Class B ordinary shares, par value $0.0001 per share, of SVF 3 ( SVF Class B Ordinary Shares ) automatically converted, on a one-for-one basis, into a share of Class B common stock, par value $0.0001 per share, of Symbotic ( Class B Common Stock ). Immediately following the Domestication of SVF 3, on June 7, 2022, as contemplated by the Merger Agreement, SVF 3, Symbotic Holdings, Warehouse and Merger Sub consummated the business combination contemplated by the Merger Agreement, whereby: Merger Sub merged with and into Interim Symbotic (the Merger and, together with the Domestication and the other transactions contemplated by the Merger Agreement, the Business Combination ), with Interim Symbotic surviving the merger as a subsidiary of Symbotic ( New Symbotic Holdings ); Table of Contents at the effective time of the Merger (the Effective Time ), New Symbotic Holdings entered into the Second Amended and Restated Limited Liability Company Agreement of Symbotic Holdings LLC (the New Symbotic Holdings LLC Agreement ), which, among other things, provided that Symbotic will be the managing member of New Symbotic Holdings; and at the Effective Time, each common unit of Interim Symbotic that was issued and outstanding immediately prior to the Effective Time was converted into the right to receive a number of common units in New Symbotic Holdings ( New Symbotic Holdings Common Units ), which New Symbotic Holdings Common Units entitle the holder to the distributions, allocations and other rights under the New Symbotic Holdings LLC Agreement, and an equal number of either shares of Class V-1 common stock, par value $0.0001, of Symbotic ( Class V-1 Common Stock ) or shares of Class V-3 common stock, par value $0.0001, of Symbotic ( Class V-3 Common Stock ), as well as the contingent right to receive certain earnout interests, in each case, as set forth in the Merger Agreement. In connection with the consummation of the Business Combination, the Company issued an aggregate of 60,844,573 shares of Class V-1 Common Stock and 416,933,025 shares of Class V-3 Common Stock, each of which is exchangeable, together with a New Symbotic Holdings Common Unit, into an equal number of Class A Common Stock. Each share of the then-issued and outstanding shares of Class B Common Stock were converted into a share of Class A Common Stock at the Effective Time. Our Class A Common Stock is listed on NASDAQ under the symbol SYM. The Business Combination has been accounted for as a reverse recapitalization in accordance with accounting principles generally accepted in the United States ( GAAP ), with no goodwill or other intangible assets recorded. Under this method of accounting, SVF 3 was treated as the acquired company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of Warehouse issuing stock for the net assets of SVF 3, accompanied by a recapitalization. The net assets of SVF 3 were stated at historical cost, with no goodwill or other intangible assets recorded. The rights of holders of our Class A Common Stock are governed by our Charter, our Bylaws, and the DGCL. See the sections entitled Description of Capital Stock and Selling Securityholders . Corporate Information Symbotic Inc. is a Delaware corporation. Our principal executive offices are located at 200 Research Drive, Wilmington, Massachusetts 01887 and our telephone number at that address is (978) 284-2800. Our website is located at www.symbotic.com. We do not incorporate the information contained on, or accessible through, our corporate website into this prospectus, and you should not consider it part of this prospectus. We have included our website address only as an inactive textual reference and do not intend it to be an active link to our website. Emerging Growth Company We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ), and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Table of Contents registration statement under the Securities Act declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company which is not an emerging growth company or is an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. We will remain an emerging growth company until the earliest of: (i) the end of the fiscal year in which we had total annual gross revenue of $1.07 billion; (ii) the last day of our fiscal year following March 11, 2026 (the fifth anniversary of the date on which SVF 3 consummated the SVF 3 IPO); (iii) the date on which we have issued more than $1.0 billion in non-convertible debt during the preceding three-year period; or (iv) the end of the fiscal year in which the market value of our common stock held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter. References herein to emerging growth company have the meaning associated with it in the JOBS Act. The Offering Issuer Symbotic Inc. (f/k/a SVF Investment Corp. 3 ) Offering and Resale of Class A Common Stock Shares of Class A Common Stock offered by the Selling Securityholders Up to an aggregate of 554,976,655 shares of Class A Common Stock, par value $0.0001 per share, purchased at a price, or acquired based on a value, of $10.00 per share, which consists of (i) 49,740,000 shares of Class A Common Stock outstanding on the date of this prospectus and (ii) 505,236,655 shares of Class A Common Stock issuable in exchange for units of New Symbotic Holdings pursuant to the terms of the New Symbotic Holdings LLC Agreement (including Earnout Interests to which such unitholders may be entitled and unvested warrant units). Shares of Class A Common Stock outstanding 54,280,146 shares (as of the date of this prospectus) Use of proceeds We will not receive any proceeds. Lock-up Restrictions Certain of our stockholders are subject to certain restrictions on transfer until the termination of applicable lock-up periods. See Plan of Distribution Lock-Up Agreements for further discussion. Nasdaq Global Select Market Ticker Symbol SYM
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/TETUF_technology_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/TETUF_technology_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..9ca357dd8290cf7d08cd901276a535a2211ee267
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/TETUF_technology_prospectus_summary.txt
@@ -0,0 +1,4076 @@
+SUMMARY
+OF RISK FACTORS
+
+ 
+
+We
+are a newly incorporated company that has conducted no operations and has generated no revenues. Until we complete our initial business
+combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities,
+you should take into account not only the background of our management team, but also the special risks we face as a blank check company.
+This offering is not subject to Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally
+afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ
+from this offering, please see the section of this prospectus entitled "Proposed Business — Comparison of This Offering to
+Those of Blank Check Companies Subject to Rule 419." You should carefully consider these, and the other risks set forth in the
+section of this prospectus entitled "Risk Factors." Such risks include, but are not limited to:
+
+ 
+
+Risks
+Relating to Our Search for, and Consummation of or Inability to Consummate, a Business Combination
+
+ 
+
+ 
+ 
+ 
+ Our
+ public shareholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete
+ our initial business combination even though a majority of our public shareholders do not support such a combination.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If
+ we seek shareholder approval of our initial business combination, our initial shareholders and members of our management team have
+ agreed to vote in favor of such initial business combination, regardless of how our public shareholders vote.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Your
+ only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your
+ right to redeem your shares from us for cash.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business
+ combination targets, which may make it difficult for us to enter into a business combination with a target.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to
+ complete the most desirable business combination or optimize our capital structure.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the
+ probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order
+ to redeem your shares.
+
+ 
+ 
+
+ 
+ 
+ 
+ The
+ requirement that we complete an initial business combination within the period to consummate the initial business combination may
+ give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to
+ conduct due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our
+ ability to complete our initial business combination on terms that would produce value for our shareholders.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may not be able to complete an initial business combination within the period to consummate the initial business combination (subject
+ to two three-month extensions at the option of the sponsor, as discussed in this prospectus), in which case we would cease all operations
+ except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public shareholders may
+ only receive $10.15 per share (whether or not the underwriters over-allotment option is exercised in full) or potentially
+ less than $10.15 per share on our redemption, and our rights and warrants will expire worthless.
+
+ 
+
+ 
+
+ 40
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ If
+ we seek shareholder approval of our initial business combination, our initial shareholders, directors, executive officers, advisors
+ and their respective affiliates may elect to purchase shares from public shareholders, which may influence a vote on a proposed business
+ combination and reduce the public "float" of our Class A ordinary shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If
+ a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination
+ or fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ You
+ will not be entitled to protections normally afforded to investors of many other blank check companies.
+
+ 
+ 
+
+Risks
+Relating to the Post-Business Combination Company
+
+ 
+
+ 
+ 
+ 
+ Subsequent
+ to the completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment
+ or other charges that could have a significant negative effect on our financial condition, results of operations and our share price,
+ which could cause you to lose some or all of your investment.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ officers and directors of an acquisition candidate may resign upon completion of our initial business combination. The loss of a
+ business combination target s key personnel could negatively impact the operations and profitability of our post-combination
+ business.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ management may not be able to maintain control of a target business after our initial business combination. Upon the loss of control
+ of a target business, new management may not possess the skills, qualifications or abilities necessary to profitably operate such
+ business.
+
+ 
+ 
+
+Risks
+Relating to Our Management Team
+
+ 
+
+ 
+ 
+ 
+ We
+ are dependent upon our executive officers and directors and their loss could adversely affect our ability to operate.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the
+ efforts of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could
+ negatively impact the operations and profitability of our post-combination business.
+
+ 
+ 
+
+Risks
+Relating to Our Securities
+
+ 
+
+ 
+ 
+ 
+ Nasdaq
+ may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities
+ and subject us to additional trading restrictions.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ sponsor paid an aggregate of $25,000, or approximately $0.009 per founder share, and, accordingly, you will experience immediate
+ and substantial dilution from the purchase of the Class A ordinary shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Since
+ our sponsor paid approximately $0.009 per share for the founder shares, our officers and directors could potentially make a substantial
+ profit even if we acquire a target business that subsequently declines in value.
+
+ 
+ 
+
+General
+Risk Factors
+
+ 
+
+ 
+ 
+ 
+ We
+ are a recently incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability
+ to achieve our business objective.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Past
+ performance by our sponsor and our management team including their affiliates and including the businesses referred to herein, may
+ not be indicative of future performance of an investment in us or in the future performance of any business that we may acquire.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ The
+ Cayman Islands has a different body of securities laws as compared to the United States and provides less protection to investors.
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Cayman
+ Islands courts are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon
+ the civil liability provisions of U.S. federal or state securities laws; and (ii) in original actions brought in the Cayman Islands,
+ to impose liabilities against us predicated upon the civil liability provisions of U.S. federal or state securities laws, so far
+ as the liabilities imposed by those provisions are penal in nature.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ courts of the Cayman Islands will recognize and enforce a foreign money judgment without re-examination or re-litigation of the matters
+ adjudicated upon, only if the judgement (i) is given by a foreign court of competent jurisdiction; (ii) is final and conclusive;
+ (iii) is not in respect of a tax, fine or other penalty; (iv) was not obtained by fraud; and (v) is not of a kind, the enforcement
+ of which is contrary to public policy in the Cayman Islands.
+
+ 
+ 
+
+ 41
+
+ 
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+An
+investment in our securities involves a high degree of risk. You should consider all of the risks described below carefully, together
+with the other information contained in this prospectus, before making a decision to invest in our public shares. If any of the following
+events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading
+price of our securities could decline, and you could lose all or part of your investment.
+
+ 
+
+Risks
+Relating to Our Search for, and Consummation of or Inability to Consummate, a Business Combination
+
+ 
+
+Our
+public shareholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete
+our initial business combination even though a majority of our public shareholders do not support such a combination.
+
+ 
+
+We
+may choose not to hold a shareholder vote before we complete our initial business combination if the initial business combination would
+not require shareholder approval under applicable law or stock exchange listing requirement. For instance, if we were seeking to acquire
+a target business where the consideration we were paying in the transaction was all cash, we would not be required to seek shareholder
+approval to complete such a transaction. Except as required by law or stock exchange requirements, the decision as to whether we will
+seek shareholder approval of a proposed business combination or will allow shareholders to sell their shares to us in a tender offer
+will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing of the transaction and whether
+the terms of the transaction would otherwise require us to seek shareholder approval. Accordingly, we may complete our initial business
+combination even if a majority of our public shareholders do not approve of the initial business combination we complete.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination, our initial shareholders and members of our management team have agreed
+to vote in favor of such initial business combination, regardless of how our public shareholders vote.
+
+ 
+
+Pursuant
+to a letter agreement, our sponsor, officers and directors have agreed to vote their founder shares, as well as any public shares purchased
+during or after this offering (including in open market and privately negotiated transactions), in favor of our initial business combination.
+As a result, in the event that only the minimum number of shares representing a quorum is present at a shareholders meeting held
+to vote on our initial business combination, in addition to our initial shareholders founder shares and placement shares, we would
+need 265,001, or 2.7% of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination approved
+in favor of our initial business combination in order to have our initial business combination approved. Additionally, each public shareholder
+may elect to redeem its public shares irrespective of whether they vote for or against, or abstain from voting on, the proposed transaction
+or abstain from voting (subject to the limitation described in this prospectus. Our initial shareholders will own shares representing
+22.96% of our outstanding ordinary shares immediately following the completion of this offering (assuming they do not purchase any units
+in this offering and the over-allotment option is not exercised). Accordingly, if we seek shareholder approval of our initial business
+combination, the agreement by our initial shareholders to vote in favor of our initial business combination will increase the likelihood
+that we will receive the requisite shareholder approval for such initial business combination.
+
+ 
+
+Your
+only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your
+right to redeem your shares from us for cash, unless we seek shareholder approval of the initial business combination.
+
+ 
+
+At
+the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of one or more
+target businesses. Since our board of directors may complete a business combination without seeking shareholder approval, public shareholders
+may not have the right or opportunity to vote on the initial business combination, unless we seek such shareholder vote. Accordingly,
+your only opportunity to affect the investment decision regarding a potential business combination may be limited to exercising your
+redemption rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed
+to our public shareholders in which we describe our initial business combination.
+
+ 
+
+ 42
+
+ 
+
+ 
+
+ 
+
+Our sponsor
+has the right to extend the term we have to consummate our initial business combination, without providing our shareholders with redemption
+rights. 
+
+ 
+
+We
+will have until 12 months from the closing of this offering to consummate our initial business combination. However, if we anticipate
+that we may not be able to consummate our initial business combination within 12 months, we may, by resolution of our board of directors
+if requested by our sponsor, extend the period of time to consummate a business combination for up to an additional six (6) months,
+in increments of three months, to a total time period of 18 months. In order to extend the time available for us to consummate
+our initial business combination, our sponsor or its affiliates or designees, upon five (5) days advance notice prior to the applicable
+deadline, must deposit into the trust account $1,000,000, or up to $1,150,000 if the underwriters over-allotment option is exercised
+in full ($0.10 per share in either case) on or prior to the date of the applicable deadline, for each three month extension (or up to
+an aggregate of $2,000,000 (or $2,300,000 if the underwriters over-allotment option is exercised in full), or $0.20 per share
+if we extend for the full six months). Our shareholders will not be entitled to vote or redeem their shares in connection with any such
+extension. This feature is different than the traditional special purpose acquisition company structure, in which any extension of the
+company s period to complete a business combination requires a vote of the company s shareholders and shareholders have the
+right to redeem their public shares in connection with such vote.
+
+ 
+
+The
+ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business
+combination targets, which may make it difficult for us to enter into a business combination with a target.
+
+ 
+
+We
+may seek to enter into a business combination transaction agreement with a prospective target that requires as a closing condition that
+we have a minimum net worth or a certain amount of cash. If too many public shareholders exercise their redemption rights, we would not
+be able to meet such closing condition and, as a result, would not be able to proceed with the initial business combination. Furthermore,
+in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 either
+immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions
+(so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement
+which may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted
+redemption requests would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination
+and after payment of underwriters fees and commissions or such greater amount necessary to satisfy a closing condition as described
+above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business
+combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into a business combination transaction
+with us.
+
+ 
+
+The
+ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete
+the most desirable business combination or optimize our capital structure.
+
+ 
+
+At
+the time we enter into an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption
+rights, and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted
+for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the
+purchase price or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust
+account to meet such requirements or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption
+than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account
+or arrange for third party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence
+of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision
+of the founder shares result in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the founder shares
+at the time of the consummation of our business combination. The above considerations may limit our ability to complete the most desirable
+business combination available to us or optimize our capital structure. The amount of the deferred underwriting commissions payable to
+the underwriters will not be adjusted for any shares that are redeemed in connection with an initial business combination. The per-share
+amount we will distribute to shareholders who properly exercise their redemption rights will not be reduced by the deferred underwriting
+commission and after such redemptions, the per-share value of shares held by non-redeeming shareholders will reflect our obligation to
+pay the deferred underwriting commissions.
+
+ 
+
+ 43
+
+ 
+
+ 
+
+ 
+
+The
+ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability
+that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.
+
+ 
+
+At
+the time we enter into an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption
+rights, and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted
+for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the
+purchase price or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust
+account to meet such requirements or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption
+than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account
+or arrange for third party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence
+of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision
+of the founder shares result in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the founder shares
+at the time of the consummation of our business combination. The above considerations may limit our ability to complete the most desirable
+business combination available to us or optimize our capital structure. The amount of the deferred underwriting commissions payable to
+the underwriters will not be adjusted for any shares that are redeemed in connection with an initial business combination. The per-share
+amount we will distribute to shareholders who properly exercise their redemption rights will not be reduced by the deferred underwriting
+commission and after such redemptions, the per-share value of shares held by non-redeeming shareholders will reflect our obligation to
+pay the deferred underwriting commissions.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules,
+and if you or a "group" of shareholders are deemed to hold in excess of 15% of our ordinary shares, you will lose the ability
+to redeem all such shares in excess of 15% of our ordinary shares. 
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public
+shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as
+a "group" (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with
+respect to more than an aggregate of 15% of the shares sold in this offering without our prior consent, which we refer to as the "Excess
+Shares." However, we would not be restricting our shareholders ability to vote all of their shares (including Excess Shares)
+for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability
+to complete our initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares
+in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete
+our initial business combination. And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose
+of such shares, would be required to sell your stock in open market transactions, potentially at a loss.
+
+ 
+
+The
+requirement that we complete an initial business combination within the period to consummate the initial business combination may give
+potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct
+due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our ability to
+complete our initial business combination on terms that would produce value for our shareholders.
+
+ 
+
+Any
+potential target business with which we enter into negotiations concerning an initial business combination will be aware that we must
+complete our initial business combination within 12 months from the closing of this offering (subject to two three-month extensions of
+time by depositing into the trust account for each three month extension $1,000,000, or $1,150,000
+if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case). Consequently, such target
+business may have leverage over us in negotiating an initial business combination, knowing that if we do not complete our initial business
+combination with that particular target business, we may be unable to complete our initial business combination with any target business.
+This risk will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct due diligence
+and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.
+
+ 
+
+We
+may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations
+except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public shareholders may receive
+only $10.15 per share, or less than such amount in certain circumstances, and our warrants will expire worthless.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will provide that we must complete our initial business combination within
+12 months from the closing of this offering (subject to two three-month extensions of time by depositing
+into the trust account for each three month extension $1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised
+in full ($0.10 per unit in either case). We may not be able to find a suitable target business and complete our initial business
+combination within such time period. Our ability to complete our initial business combination may be negatively impacted by general market
+conditions, political considerations, volatility in the capital and debt markets and the other risks described herein. If we have not
+completed our initial business combination within such time period, we will (i) cease all operations except for the purpose of winding
+up, (ii) as promptly as reasonably possible but not more than 10 business days thereafter, redeem the public shares, at a per-share price,
+payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the
+trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided
+by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders
+(including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such
+redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in the
+case of clauses (ii) and (iii) to our obligations under the Companies Act to provide for claims of creditors and the requirements of
+other applicable law. In such case, our public shareholders may receive only $10.15 per share (whether or not the underwriters 
+over-allotment option is exercised in full) or potentially less than $10.15 per share on our redemption, and our rights and warrants
+will expire worthless. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced
+and the per-share redemption amount received by shareholders may be less than $10.15 per share" and other risk factors below.
+
+ 
+
+ 44
+
+ 
+
+ 
+
+ 
+
+Our
+search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially
+adversely affected by the coronavirus (COVID-19) pandemic.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will provide that we must complete our initial business combination within
+12 months (subject to two three-month extensions of time by depositing into the trust account for
+each three month extension $1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per
+unit in either case). We may not be able to find a suitable target business and complete an initial business combination within
+the period to consummate the initial business combination. Our ability to complete our initial business combination may be negatively
+impacted by general market conditions, volatility in the capital and debt markets and the other risks described herein. For example,
+the outbreak of coronavirus ("COVID-19") continues to grow both in the U.S. and globally and, while the extent of the impact
+of the outbreak on us will depend on future developments, it could limit our ability to complete our initial business combination, including
+as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable
+to us or at all.
+
+ 
+
+Additionally,
+the outbreak of COVID-19 may continue to negatively impact businesses we may seek to acquire. If we have not completed an initial business
+combination within such applicable time period, we will (i) cease all operations except for the purpose of winding up; (ii) as promptly
+as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash,
+equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account
+and not previously released to us to pay our taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by
+the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders
+(including the right to receive further liquidating distributions, if any), subject to applicable law; and (iii) as promptly as reasonably
+possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve,
+subject in each case to our obligations under the Companies Act to provide for claims of creditors and the requirements of other applicable
+law.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination, our sponsor, directors, officers, advisors and their affiliates may
+elect to purchase shares or warrants from public holders, which may influence a vote on a proposed initial business combination and reduce
+the public "float" of our Class A ordinary shares or public warrants.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares or
+public warrants or a combination thereof, in privately-negotiated transactions or in the open market, either prior to or following the
+completion of our initial business combination, although they are under no obligation to do so. However, they have no current commitments,
+plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of
+the funds in the trust account will be used to purchase shares or public warrants in such transactions. See "Proposed Business
+— Permitted Purchases of Our Securities" for a description of how our sponsor, initial shareholders, directors, officers,
+advisors or any of their affiliates will select which shareholders to purchase securities from in any private transaction.
+
+ 
+
+Such
+a purchase may include a contractual acknowledgement that such shareholder, although still the record holder of our shares, is no longer
+the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that our sponsor, directors, officers,
+advisors or their affiliates purchase shares in privately negotiated transactions from public shareholders who have already elected to
+exercise their redemption rights, such selling shareholders would be required to revoke their prior elections to redeem their shares.
+The price per share paid in any such transactions may be different than the amount per share a public shareholder would receive if such
+public shareholder elected to redeem its shares in connection with our initial business combination. The purpose of such purchases could
+be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining shareholder approval
+of the initial business combination, or to satisfy a closing condition in an agreement with a target that requires us to have a minimum
+net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would
+otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding
+or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination.
+Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been
+possible. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers
+are subject to such reporting requirements.
+
+ 
+
+ 45
+
+ 
+
+ 
+
+ 
+
+In
+addition, if such purchases are made, the public "float" of our Class A ordinary shares or public warrants and the number
+of beneficial holders of our securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or
+trading of our securities on a national securities exchange.
+
+ 
+
+If
+a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination or
+fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
+
+ 
+
+We
+will comply with the proxy rules or tender offer rules, as applicable, when conducting redemptions in connection with our initial business
+combination. Despite our compliance with these rules, if a shareholder fails to receive our proxy materials or tender offer documents,
+as applicable, such shareholder may not become aware of the opportunity to redeem its shares. In addition, proxy materials or tender
+offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination
+will describe the various procedures that must be complied with in order to validly tender or submit public shares for redemption. For
+example, we intend to require our public shareholders seeking to exercise their redemption rights, whether they are record holders or
+hold their shares in "street name," to, at the holder s option, either deliver their share certificates to our transfer
+agent, or to deliver their shares to our transfer agent electronically prior to the date set forth in the proxy materials or tender offer
+documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the vote on the proposal
+to approve the initial business combination. In addition, if we conduct redemptions in connection with a shareholder vote, we intend
+to require a public shareholder seeking redemption of its public shares to also submit a written request for redemption to our transfer
+agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. In the event that a shareholder
+fails to comply with these, or any other procedures disclosed in the proxy or tender offer materials, as applicable, its shares may not
+be redeemed. See the section of this prospectus entitled "Proposed Business — Tendering Share Certificates in Connection
+with a Tender Offer or Redemption Rights."
+
+ 
+
+You
+will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate
+your investment, you may be forced to sell your public shares or warrants, potentially at a loss.
+
+ 
+
+Our
+public shareholders will be entitled to receive funds from the trust account only upon the earliest to occur of (i) our completion of
+an initial business combination, and then only in connection with those Class A ordinary shares that such shareholder properly elected
+to redeem, subject to the limitations described herein, (ii) the redemption of any public shares properly submitted in connection with
+a shareholder vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of
+our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100%
+of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (subject
+to two three-month extensions by depositing into the trust account for each three month extension
+$1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case)
+or (B) with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity,
+and (iii) the redemption of our public shares if we are unable to complete an initial business combination within 12 months from the
+closing of this offering (subject to two three-month extensions of time by depositing into the trust account for each three month extension
+$1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case), subject
+to applicable law and as further described herein. In addition, if we are unable to complete an initial business combination within 12
+months from the closing of this offering (subject to two three-month extensions, as set forth in this prospectus) for any reason, and
+we are required to wind-up, liquidate the trust account and distribute such amount therein, pro rata, to our public shareholders, as
+part of any liquidation process, such winding up, liquidation and distribution must comply with the applicable provisions of the Companies
+Act. In that case, investors may be forced to wait beyond 18 months from the closing of this offering before the redemption proceeds
+of our trust account become available to them, and they receive the return of their pro rata portion of the proceeds from our trust account.
+In no other circumstances will a public shareholder have any right or interest of any kind in the trust account. Holders of warrants
+will not have any right to the proceeds held in the trust account with respect to the warrants. Accordingly, to liquidate your investment,
+you may be forced to sell your public shares or warrants, potentially at a loss.
+
+ 
+
+ 46
+
+ 
+
+ 
+
+ 
+
+You
+will not be entitled to protections normally afforded to investors of many other blank check companies.
+
+ 
+
+Since
+the net proceeds of this offering and the sale of the placement units are intended to be used to complete an initial business combination
+with a target business that has not been identified, we may be deemed to be a "blank check" company under the U.S. securities
+laws. However, because we will have net tangible assets in excess of $5,000,001 upon the successful completion of this offering and the
+sale of the placement units and will file a Current Report on Form 8-K, including an audited balance sheet demonstrating this fact, we
+are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419. Accordingly, investors
+will not be afforded the benefits or protections of those rules. Among other things, this means our units will be immediately tradable
+and we will have a longer period of time to complete our initial business combination than companies subject to Rule 419. Moreover, if
+this offering were subject to Rule 419, that rule would prohibit the release of any interest earned on funds held in the trust account
+to us unless and until the funds in the trust account were released to us in connection with our completion of an initial business combination.
+For a more detailed comparison of our offering to offerings that comply with Rule 419, please see the section of this prospectus entitled
+"Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419."
+
+ 
+
+Because
+of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete
+our initial business combination. If we are unable to complete our initial business combination, our public shareholders may receive
+only approximately $10.15 per share on our redemption of our public shares, or less than such amount in certain circumstances, and our
+warrants will expire worthless.
+
+ 
+
+We
+expect to encounter competition from other entities having a business objective similar to ours, including private investors (which may
+be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing for
+the types of businesses we intend to acquire. Many of these individuals and entities are well established and have extensive experience
+in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries.
+Many of these competitors possess similar or greater technical, human and other resources to ours, and our financial resources will be
+relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we
+could potentially acquire with the net proceeds of this offering and the sale of the placement units, our ability to compete with respect
+to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This inherent
+competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, because we are
+obligated to pay cash for the Class A ordinary shares that our public shareholders redeem in connection with our initial business combination,
+target companies will be aware that this may reduce the resources available to us for our initial business combination. Any of these
+obligations may place us at a competitive disadvantage in successfully negotiating an initial business combination. If we are unable
+to complete our initial business combination, our public shareholders may receive only approximately $10.15 per share (whether or not
+the underwriters over-allotment option is exercised in full) or potentially less than $10.15 per share on our redemption, and
+our rights and warrants will expire worthless. See "— If third parties bring claims against us, the proceeds held in the
+trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15 per share"
+and other risk factors below.
+
+ 
+
+ 47
+
+ 
+
+ 
+
+ 
+
+If
+the net proceeds of this offering and the sale of the placement units not being held in the trust account are insufficient to allow us
+to operate for at least the next 12 months (or up to 18 months, as applicable), we may be unable to complete our initial business combination,
+in which case our public shareholders may only receive $10.15 per share, or less than such amount in certain circumstances, and our warrants
+will expire worthless.
+
+ 
+
+The
+funds available to us outside of the trust account may not be sufficient to allow us to operate for at least the next 12 months (or up
+to 18 months, as applicable) following the closing of this offering, assuming that our initial business combination is not completed
+during that time. We believe that, upon the closing of this offering, the funds available to us outside of the trust account will be
+sufficient to allow us to operate for at least the next 12 months (or up to 18 months, as applicable); however, we cannot assure you
+that our estimate is accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants
+to assist us with our search for a target business. We could also use a portion of the funds as a down payment or to fund a "no-shop"
+provision (a provision in letters of intent or merger agreements designed to keep target businesses from "shopping" around
+for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed
+initial business combination, although we do not have any current intention to do so. If we entered into a letter of intent or merger
+agreement where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit such funds
+(whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence
+with respect to, a target business.
+
+ 
+
+Of
+the net proceeds of this offering and the sale of the placement units, only approximately $765,000 will be available to us initially
+outside the trust account to fund our working capital requirements. In the event that our offering expenses exceed our estimate of $1,035,000,
+we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside
+the trust account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate
+of $1,035,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If
+we are required to seek additional capital, we would need to borrow funds from our sponsor, management team or other third parties to
+operate or may be forced to liquidate. None of our sponsor, or any affiliate of our sponsor or any of our officers and directors is under
+any obligation to advance funds to us in such circumstances except with respect to the promissory note for up to $300,000 executed on
+November 26, 2021, between the sponsor and us. Any such advances would be repaid only from funds held outside the trust account or from
+funds released to us upon completion of our initial business combination. Up to $1,500,000 of such loans may be convertible into units,
+at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The units would be
+identical to the placement units.
+
+ 
+
+Prior
+to the completion of our initial business combination, we do not expect to seek advances or loans from parties other than our sponsor
+or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any
+and all rights to seek access to funds in our trust account. If we are unable to obtain these loans, we may be unable to complete our
+initial business combination. If we are unable to complete our initial business combination, our public shareholders may receive only
+approximately $10.15 per share (whether or not the underwriters over-allotment option is exercised in full) or potentially less
+than $10.15 per share on our redemption, and our rights and warrants will expire worthless. See "— If third parties bring
+claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders
+may be less than $10.15 per share" and other risk factors below
+
+ 
+
+ 48
+
+ 
+
+ 
+
+ 
+
+If
+third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received
+by shareholders may be less than $10.15 per unit.
+
+ 
+
+Our
+placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all
+vendors, service providers (other than our independent registered public accounting firm), prospective target businesses and other entities
+with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held
+in the trust account for the benefit of our public shareholders, such parties may not execute such agreements, or even if they execute
+such agreements, they may not be prevented from bringing claims against the trust account, including, but not limited to, fraudulent
+inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver,
+in each case in order to gain advantage with respect to a claim against our assets, including the funds held in the trust account. If
+any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform
+an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver
+if management believes that such third party s engagement would be significantly more beneficial to us than any alternative. Making
+such a request of potential target businesses may make our acquisition proposal less attractive to them and, to the extent prospective
+target businesses refuse to execute such a waiver, it may limit the field of potential target businesses that we might pursue.
+
+ 
+
+Examples
+of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant
+whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would
+agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition,
+there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of,
+any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption
+of our public shares, if we have not completed an initial business combination within the period to consummate the initial business combination,
+or upon the exercise of a redemption right in connection with our initial business combination, we will be required to provide for payment
+of claims of creditors that were not waived that may be brought against us within the ten years following redemption.
+
+ 
+
+Accordingly,
+the per-share redemption amount received by public shareholders could be less than the $10.15 per public share initially held in the
+trust account, due to claims of such creditors. Pursuant to the letter agreement the form of which is filed as an exhibit to the registration
+statement of which this prospectus forms a part, our sponsor has agreed that it will be liable to us if and to the extent any claims
+by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective
+target business with which we have discussed entering into a transaction agreement, reduce the amounts in the trust account to below
+the lesser of (i) $10.15 per public share and (ii) the actual amount per unit held in the trust account as of the date of the liquidation
+of the trust account if less than $10.15 per unit due to reductions in the value of the trust assets, in each case net of the interest
+that may be withdrawn to pay our taxes, if any, provided that such liability will not apply to any claims by a third party or prospective
+target business that executed a waiver of any and all rights to seek access to the trust account nor will it apply to any claims under
+our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover,
+in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the
+extent of any liability for such third-party claims. However, we have not asked our sponsor to reserve for such indemnification obligations,
+nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our
+sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy
+those obligations. As a result, if any such claims were successfully made against the trust account, the funds available for our initial
+business combination and redemptions could be reduced to less than $10.15 per share (whether or not the underwriters over-allotment
+option is exercised in full). In such event, we may not be able to complete our initial business combination, and you would receive such
+lesser amount per unit in connection with any redemption of your public shares. None of our officers or directors will indemnify us for
+claims by third parties including, without limitation, claims by vendors and prospective target businesses.
+
+ 
+
+ 49
+
+ 
+
+ 
+
+ 
+
+Our
+directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in
+the trust account available for distribution to our public shareholders.
+
+ 
+
+In
+the event that the proceeds in the trust account are reduced below the lesser of (i) $10.15 per unit and (ii) the actual amount per unit
+held in the trust account as of the date of the liquidation of the trust account if less than $10.15 per unit due to reductions in the
+value of the trust assets, in each case net of the interest that may be withdrawn to pay our taxes, if any, and our sponsor asserts that
+it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent
+directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently
+expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations
+to us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary duties may
+choose not to do so in any particular instance. If our independent directors choose not to enforce these indemnification obligations,
+the amount of funds in the trust account available for distribution to our public shareholders may be reduced below $10.15 per unit.
+
+ 
+
+We
+may not have sufficient funds to satisfy indemnification claims of our directors and executive officers. We have agreed to indemnify
+our officers and directors to the fullest extent permitted by law. However, our officers and directors have agreed to waive any right,
+title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the trust account for
+any reason whatsoever (except to the extent they are entitled to funds from the trust account due to their ownership of public shares).
+Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient funds outside of the trust
+account or (ii) we complete an initial business combination. Our obligation to indemnify our officers and directors may discourage shareholders
+from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions also may have the effect
+of reducing the likelihood of derivative litigation against our officers and directors, even though such an action, if successful, might
+otherwise benefit us and our shareholders. Furthermore, a shareholder s investment may be adversely affected to the extent we pay
+the costs of settlement and damage awards against our officers and directors pursuant to these indemnification provisions.
+
+ 
+
+If,
+after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary
+bankruptcy or winding-up petition is filed against us that is not dismissed, a bankruptcy or insolvency court may seek to recover such
+proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby
+exposing the members of our board of directors and us to claims of punitive damages.
+
+ 
+
+If,
+after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary
+bankruptcy or winding-up petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed
+under applicable debtor/creditor and/or bankruptcy or insolvency laws as either a "preferential transfer" or a "fraudulent
+conveyance." As a result, a bankruptcy or insolvency court could seek to recover some or all amounts received by our shareholders.
+In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith,
+thereby exposing itself and us to claims of punitive damages, by paying public shareholders from the trust account prior to addressing
+the claims of creditors.
+
+ 
+
+If,
+before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary
+bankruptcy or winding-up petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority
+over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders in connection with
+our liquidation may be reduced.
+
+ 
+
+If,
+before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary
+bankruptcy or winding-up petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject
+to applicable bankruptcy or insolvency law and may be included in our bankruptcy estate and subject to the claims of third parties with
+priority over the claims of our shareholders. To the extent any bankruptcy claims deplete the trust account, the per-share amount that
+would otherwise be received by our shareholders in connection with our liquidation may be reduced.
+
+ 
+
+ 50
+
+ 
+
+ 
+
+ 
+
+Our
+initial business combination or related reincorporation may result in taxes imposed on shareholders.
+
+ 
+
+We
+may, in connection with our initial business combination and subject to requisite shareholder approval under the Companies Act, effect
+a business combination with a target company in another jurisdiction, reincorporate in the jurisdiction in which the partner company
+or business is located or in another jurisdiction. Such transactions may require a holder of our securities to recognize taxable income
+in the jurisdiction in which the holder of such securities is a tax resident (or in which its members are resident if it is a tax transparent
+entity), in which the target company is located, or in which we reincorporate. We do not intend to make any cash distributions to holders
+of our securities to pay such taxes. Holders of our securities may be subject to withholding taxes or other taxes with respect to their
+ownership of us after the reincorporation.
+
+ 
+
+As
+the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may
+be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in
+our inability to find a target or to consummate an initial business combination.
+
+ 
+
+In
+recent years, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets
+for special purpose acquisition companies have already entered into an initial business combination, and there are still many special
+purpose acquisition companies seeking targets for their initial business combination, as well as many such companies currently in registration.
+As a result, at times, fewer attractive targets may be available, and it may require more time, more effort and more resources to identify
+a suitable target and to consummate an initial business combination.
+
+ 
+
+In
+addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available
+targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause target
+companies to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry
+sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate
+targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate our ability to find and
+consummate an initial business combination and may result in our inability to consummate an initial business combination on terms favorable
+to our investors altogether.
+
+ 
+
+Changes
+in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and
+complete an initial business combination. 
+
+ 
+
+In
+recent months, the market for directors and officers liability insurance for special purpose acquisition companies has changed in ways
+adverse to us and our management team. The premiums charged for such policies have generally increased and the terms of such policies
+have generally become less favorable. These trends may continue into the future. The increased cost and decreased availability of directors
+and officers liability insurance could make it more difficult and more expensive for us to negotiate an initial business combination.
+In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a public company, the post-business combination
+entity might need to incur greater expense, accept less favorable terms or both. However, any failure to obtain adequate directors and
+officers liability insurance could have an adverse impact on the post-business combination s ability to attract and retain
+qualified officers and directors.
+
+ 
+
+In
+addition, even after we were to complete an initial business combination, our directors and officers could still be subject to potential
+liability from claims arising from conduct alleged to have occurred prior to the initial business combination. As a result, in order
+to protect our directors and officers, the post-business combination entity will likely need to purchase additional insurance with
+respect to any such claims ("run-off insurance"). The need for run-off insurance would be an added expense for
+the post-business combination entity, and could interfere with or frustrate our ability to consummate an initial business combination
+on terms favorable to our investors.
+
+ 
+
+If
+we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements
+and our activities may be restricted, which may make it difficult for us to complete our initial business combination.
+
+ 
+
+If
+we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including:
+
+ 
+
+ 
+ 
+ 
+ restrictions
+ on the nature of our investments; and
+
+ 
+ 
+ 
+ restrictions
+ on the issuance of securities, each of which may make it difficult for us to complete our initial business combination.
+
+ 
+ 
+
+In
+addition, we may have imposed upon us burdensome requirements, including:
+
+ 
+
+ 
+ 
+ 
+ registration
+ as an investment company;
+
+ 
+ 
+ 
+ adoption
+ of a specific form of corporate structure; and
+
+ 
+ 
+ 
+ reporting,
+ record keeping, voting, proxy and disclosure requirements and other rules and regulations.
+
+ 
+ 
+
+In
+order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must
+ensure that we are engaged primarily in a business other than investing, reinvesting or trading of securities and that our activities
+do not include investing, reinvesting, owning, holding or trading "investment securities" constituting more than 40% of our
+assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Our business will be to identify and complete
+a business combination and thereafter to operate the post-transaction business or assets for the long term. We do not plan to buy businesses
+or assets with a view to resale or profit from their resale. We do not plan to buy unrelated businesses or assets or to be a passive
+investor.
+
+ 
+
+ 51
+
+ 
+
+ 
+
+ 
+
+We
+do not believe that our anticipated principal activities will subject us to the Investment Company Act. To this end, the proceeds held
+in the trust account may only be invested in United States "government securities" within the meaning of Section 2(a)(16)
+of the Investment Company Act having a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7
+promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations. Pursuant to the trust
+agreement, the trustee is not permitted to invest in other securities or assets. By restricting the investment of the proceeds to these
+instruments, and by having a business plan targeted at acquiring and growing businesses for the long term (rather than on buying and
+selling businesses in the manner of a merchant bank or private equity fund), we intend to avoid being deemed an "investment company"
+within the meaning of the Investment Company Act.
+
+ 
+
+This
+offering is not intended for persons who are seeking a return on investments in government securities or investment securities. The trust
+account is intended as a holding place for funds pending the earliest to occur of either: (a) the completion of our initial business
+combination; (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and
+restated memorandum and articles of association (i) to modify the substance or timing of our obligation to allow redemption in connection
+with our initial business combination or to redeem 100% of our public shares if we do not complete an initial business combination within
+the period to consummate the initial business combination or (ii) with respect to any other provisions relating to the rights of holders
+of our Class A ordinary shares; or (c) absent our completing an initial business combination within the period to consummate the initial
+business combination, our return of the funds held in the trust account to our public shareholders as part of our redemption of the public
+shares. If we do not invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act. If we were
+deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses
+for which we have not allotted funds and may hinder our ability to complete a business combination. If we do not complete our initial
+business combination, our public shareholders may only receive their pro rata portion of the funds in the trust account that are available
+for distribution to public shareholders.
+
+ 
+
+Changes
+in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability
+to negotiate and complete our initial business combination and results of operations.
+
+ 
+
+We
+are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply
+with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult,
+time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and
+those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to
+comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including
+our ability to negotiate and complete our initial business combination, and results of operations.
+
+ 
+
+The
+securities in which we invest the funds held in the trust account could bear a negative rate of interest, which could reduce the value
+of the assets held in trust such that the per-share redemption amount received by public shareholders may be less than approximately
+$10.15 per share.
+
+ 
+
+The
+proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 180 days or less
+or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S.
+government treasury obligations. While short-term U.S. government treasury obligations currently yield a positive rate of interest, they
+have briefly yielded negative interest rates in recent years. Central banks in Europe and Japan pursued interest rates below zero in
+recent years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that it may in the future adopt
+similar policies in the United States. In the event that we do not to complete our initial business combination or make certain amendments
+to our amended and restated memorandum and articles of association, our public shareholders are entitled to receive their pro-rata share
+of the proceeds held in the trust account, plus any interest income, net of tax (less, in the case we are unable to complete our initial
+business combination, $100,000 of dissolution expenses). Negative interest rates could reduce the value of the assets held in trust such
+that the per-share redemption amount received by public shareholders may be less than approximately $10.15 per share.
+
+ 
+
+ 52
+
+ 
+
+ 
+
+ 
+
+If
+we have not completed an initial business combination within 12 months (or up to 18 months, as applicable), our public shareholders may
+be forced to wait beyond such period to consummate the initial business combination before redemption from our trust account.
+
+ 
+
+If
+we have not completed an initial business combination within 12 months (or up to 18 months, as applicable), the proceeds then on deposit
+in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes,
+if any (less up to $100,000 of the interest to pay dissolution expenses), will be used to fund the redemption of our public shares, as
+further described herein. Any redemption of public shareholders from the trust account will be effected automatically by function of
+our amended and restated memorandum and articles of association prior to any voluntary winding up. If we are required to wind-up, liquidate
+the trust account and distribute such amount therein, pro rata, to our public shareholders, as part of any liquidation process, such
+winding up, liquidation and distribution must comply with the applicable provisions of the Companies Act. In that case, investors may
+be forced to wait beyond the period to consummate the initial business combination before the redemption proceeds of our trust account
+become available to them, and they receive the return of their pro rata portion of the proceeds from our trust account. We have no obligation
+to return funds to investors prior to the date of our redemption or liquidation unless we complete our initial business combination prior
+thereto and only then in cases where investors have sought to redeem their Class A ordinary shares. Only upon our redemption or any liquidation
+will public shareholders be entitled to distributions if we do not complete our initial business combination.
+
+ 
+
+Our
+shareholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption
+of their shares.
+
+ 
+
+If
+we are forced to enter an insolvent liquidation, any distributions received by shareholders could be viewed as an unlawful payment if
+it was proved that immediately following the date on which the distribution was made, we were unable to pay our debts as they fall due
+in the ordinary course of business. As a result, a liquidator could seek to recover some, or all amounts received by our shareholders.
+Furthermore, our directors may be viewed as having breached their fiduciary duties to us or our creditors and/or may have acted in bad
+faith, thereby exposing themselves and our company to claims, by paying public shareholders from the trust account prior to addressing
+the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons. We and our directors and
+officers who knowingly and willfully authorized or permitted any distribution to be paid out of our share premium account while we were
+unable to pay our debts as they fall due in the ordinary course of business would be guilty of an offence and may be liable to a fine
+and imprisonment in the Cayman Islands.
+
+ 
+
+We
+may not hold an annual meeting of shareholders until after the completion of our initial business combination.
+
+ 
+
+In
+accordance with the Nasdaq corporate governance requirements, we are not required to hold an annual general meeting until no later than
+one year after our first fiscal year end following our listing on Nasdaq. There is no requirement under the Companies Act for us to hold
+annual or extraordinary general meetings to appoint directors. Until we hold an annual general meeting, public shareholders may not be
+afforded the opportunity to appoint directors and to discuss company affairs with management.
+
+ 
+
+The
+grant of registration rights to our initial shareholders may make it more difficult to complete our initial business combination, and
+the future exercise of such rights may adversely affect the market price of the Class A ordinary shares.
+
+ 
+
+Pursuant
+to a registration rights agreement to be entered into concurrently with the issuance and sale of the securities in this offering, our
+initial shareholders and their permitted transferees can demand that we register the resale of the placement shares, the placement warrants
+(and the underlying Class A ordinary shares), the Class A ordinary shares issuable upon conversion of the founder shares and the Class
+A ordinary shares and warrants (and the underlying Class A ordinary shares) underlying the units that may be issued upon conversion of
+working capital loans. We will bear the cost of registering these securities. The registration and availability of such a significant
+number of securities for trading in the public market may have an adverse effect on the market price of our Class A ordinary shares.
+In addition, the existence of the registration rights may make our initial business combination more costly or difficult to conclude.
+This is because the shareholders of the target business may increase the equity stake they seek in the combined entity or ask for more
+cash consideration to offset the negative impact on the market price of our Class A ordinary shares that is expected when the securities
+owned by our initial shareholders or holders of working capital loans or their respective permitted transferees are registered for resale.
+
+ 
+
+ 53
+
+ 
+
+ 
+
+ 
+
+Because
+we are neither limited to evaluating a target business in a particular industry sector nor have we selected any specific target businesses
+with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business s
+operations.
+
+ 
+
+We
+may pursue business combination opportunities in any sector, except that we will not, under our amended and restated memorandum and articles
+of association, be permitted to effectuate our initial business combination with another blank check company or similar company with
+nominal operations. Because we have not yet selected or approached any specific target business with respect to a business combination,
+there is no basis to evaluate the possible merits or risks of any particular target business s operations, results of operations,
+cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination, we may be affected
+by numerous risks inherent in the business operations with which we combine. Although our officers and directors will endeavor to evaluate
+the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant
+risk factors or that we will have adequate time to complete due diligence.
+
+ 
+
+Furthermore,
+some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will
+adversely impact a target business. We also cannot assure you that an investment in our public shares will ultimately prove to be more
+favorable to investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly, any
+shareholders who choose to remain shareholders following our initial business combination could suffer a reduction in the value of their
+securities. Such shareholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that
+the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are
+able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable,
+relating to the initial business combination contained an actionable material misstatement or material omission.
+
+ 
+
+We
+may seek acquisition opportunities in industries or sectors which may or may not be outside of our management s area of expertise.
+
+ 
+
+We
+will consider a business combination outside of our management s area of expertise if a business combination candidate is presented
+to us and we determine that such candidate offers an attractive acquisition opportunity for our company. Although our management will
+endeavor to evaluate the risks inherent in any particular business combination candidate, we cannot assure you that we will adequately
+ascertain or assess all of the significant risk factors. We also cannot assure you that an investment in our public shares will not ultimately
+prove to be less favorable to investors in this offering than a direct investment, if an opportunity were available, in a business combination
+candidate. In the event we elect to pursue an acquisition outside of the areas of our management s expertise, our management s
+expertise may not be directly applicable to its evaluation or operation, and the information contained in this prospectus regarding the
+areas of our management s expertise would not be relevant to an understanding of the business that we elect to acquire. As a result,
+our management may not be able to adequately ascertain or assess all of the significant risk factors. Accordingly, any shareholder who
+choose to remain shareholders following our initial business combination could suffer a reduction in the value of their shares. Such
+shareholders are unlikely to have a remedy for such reduction in value.
+
+ 
+
+ 54
+
+ 
+
+ 
+
+ 
+
+Although
+we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses and our
+strategy will be to identify, acquire and build a company in our target investment area, we may enter into our initial business combination
+with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial
+business combination may not have attributes entirely consistent with our general criteria and guidelines.
+
+ 
+
+Although
+we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business
+with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial
+business combination with a target that does not meet some or all of these guidelines, such combination may not be as successful as a
+combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business
+combination with a target that does not meet our general criteria and guidelines, a greater number of shareholders may exercise their
+redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a
+minimum net worth or a certain amount of cash. In addition, if shareholder approval of the transaction is required by applicable law
+or stock exchange requirements, or we decide to obtain shareholder approval for business or other legal reasons, it may be more difficult
+for us to attain shareholder approval of our initial business combination if the target business does not meet our general criteria and
+guidelines. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.15
+per share (whether or not the underwriters over-allotment option is exercised in full) or potentially less than $10.15 per share
+on our redemption, and our rights and warrants will expire worthless. See "— If third parties bring claims against us, the
+proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15
+per share" and other risk factors herein.
+
+ 
+
+We
+may seek business combination opportunities with a financially unstable business or an entity lacking an established record of revenue,
+cash flow or earnings, which could subject us to volatile revenues, cash flows or earnings or difficulty in retaining key personnel.
+
+ 
+
+To
+the extent we complete our initial business combination with a financially unstable business or an entity lacking an established record
+of revenues or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. These
+risks include volatile revenues or earnings and difficulties in obtaining and retaining key personnel. Although our officers and directors
+will endeavor to evaluate the risks inherent in a particular target business, we may not be able to properly ascertain or assess all
+of the significant risk factors and we may not have adequate time to complete due diligence. Furthermore, some of these risks may be
+outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target
+business.
+
+ 
+
+We
+are not required to obtain an opinion from an independent accounting or investment banking firm, and consequently, you may have no assurance
+from an independent source that the price we are paying for the business is fair to our shareholders from a financial point of view.
+
+ 
+
+Unless
+we complete our initial business combination with an affiliated entity or our board cannot independently determine the fair market value
+of the target business or businesses, we are not required to obtain an opinion from an independent accounting firm or independent investment
+banking firm which is a member of FINRA or other firm that ordinarily renders valuation opinions that the price we are paying is fair
+to our company or fair to our shareholders from a financial point of view. If no opinion is obtained, our shareholders will be relying
+on the judgment of our board of directors, who will determine fair market value based on standards generally accepted by the financial
+community. Such standards used will be disclosed in our proxy solicitation or tender offer materials, as applicable, related to our initial
+business combination.
+
+ 
+
+Our
+independent registered public accounting firm s report contains an explanatory paragraph that expresses substantial doubt about
+our ability to continue as a "going concern."
+
+ 
+
+As
+of November 30, 2021, we had $0 in cash and cash equivalents and a working capital deficiency of $110,856. Further, we expect to incur
+significant costs in pursuit of our acquisition plans. Management s plans to address this need for capital through this offering
+are discussed in the section of this prospectus titled "Management s Discussion and Analysis of Financial Condition and Results
+of Operations." Our plans to raise capital and to consummate our initial business combination may not be successful. In addition,
+management is currently evaluating the impact of the COVID-19 pandemic on the industry and its effect on our financial position, results
+its operations and/or search for a target company. These factors, among others, raise substantial doubt about our ability to continue
+as a going concern. The financial statements contained elsewhere in this prospectus do not include any adjustments that might result
+from our inability to consummate this offering or our inability to continue as a going concern.
+
+ 
+
+ 55
+
+ 
+
+ 
+
+ 
+
+Resources
+could be wasted in researching business combinations that are not completed, which could materially adversely affect subsequent attempts
+to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders
+may receive only approximately $10.15 per share, or less than such amount in certain circumstances, on the liquidation of our trust account
+and our warrants will expire worthless.
+
+ 
+
+We
+anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements,
+disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants,
+attorneys, consultants and others. If we decide not to complete a specific initial business combination, the costs incurred up to that
+point for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target
+business, we may fail to complete our initial business combination for any number of reasons including those beyond our control. Any
+such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate
+and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders may
+receive only approximately $10.15 per share on the liquidation of our trust account and our warrants will expire worthless. In certain
+circumstances, our public shareholders may receive less than $10.15 per share on the redemption of their shares. See "— If
+third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received
+by shareholders may be less than $10.15 per share" and other risk factors herein
+
+ 
+
+We
+may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated
+with our sponsor, executive officers, directors or existing holders which may raise potential conflicts of interest.
+
+ 
+
+In
+light of the involvement of our sponsor, its members and our executive officers and directors with other entities, we may decide to acquire
+one or more businesses affiliated with our sponsor, executive officers, directors or existing holders. Our directors also serve as officers
+and board members for other entities, including, without limitation, those described under the section of this prospectus entitled "Management
+— Conflicts of Interest." Our sponsor and our directors and officers, or their respective affiliates may sponsor, form or
+participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination.
+Such entities may compete with us for business combination opportunities. Our sponsor, officers and directors are not currently aware
+of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and
+there have been no substantive discussions concerning a business combination with any such entity or entities. Although we will not be
+specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined
+that such affiliated entity met our criteria for a business combination as set forth in the section of this prospectus entitled "Proposed
+Business — Evaluation of a Target Business and Structuring of our Initial Business Combination" and such transaction was
+approved by a majority of our independent and disinterested directors. Despite our agreement to obtain an opinion from an independent
+investment banking firm which is a member of FINRA, or from an independent accounting firm, regarding the fairness to our company from
+a financial point of view of a business combination with one or more domestic or international businesses affiliated with our sponsor,
+executive officers, directors or existing holders, potential conflicts of interest still may exist and, as a result, the terms of the
+initial business combination may not be as advantageous to our public shareholders as they would be absent any conflicts of interest.
+
+ 
+
+ 56
+
+ 
+
+ 
+
+ 
+
+Since
+our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed (except
+with respect to any public shares they may hold), a conflict of interest may arise in determining whether a particular business combination
+target is appropriate for our initial business combination.
+
+ 
+
+On
+November 26, 2021, our sponsor purchased 2,875,000 founder shares. The number of founder shares issued was determined based on the expectation
+that such founder shares would represent approximately 20% of the outstanding shares after this offering (without giving effect to the
+private placement and assuming they do not purchase units in this offering). The founder shares will be worthless if we do not complete
+an initial business combination. In addition, our sponsor has committed to purchase an aggregate of 480,000 of the placement units (or
+532,500 of the units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price
+of $4,800,000 ($5,325,000 if the over-allotment option is exercised in full). Each placement unit consists of one Class A ordinary share
+and one warrant. Each whole warrant is exercisable to purchase one whole Class A ordinary share at $11.50 per share. These securities
+will also be worthless if we do not complete an initial business combination. Holders of founder shares have agreed (A) to vote any shares
+owned by them in favor of any proposed initial business combination and (B) not to redeem any founder shares in connection with a shareholder
+vote to approve a proposed initial business combination or in connection with a shareholder vote to approve an amendment to our amended
+and restated memorandum and articles of association. In addition, we may obtain loans from our sponsor, affiliates of our sponsor or
+an officer or director. The personal and financial interests of our officers and directors may influence their motivation in identifying
+and selecting a target business combination, completing an initial business combination and influencing the operation of the business
+following the initial business combination. This risk may become more acute as the 18-month anniversary of the closing of this offering
+nears, which is the deadline for entering into an agreement to complete an initial business combination.
+
+ 
+
+Since
+our officers and directors will share in any appreciation of the founder shares purchased at approximately $0.009 per share, a conflict
+of interest may arise in determining whether a particular target business is appropriate for our initial business combination.
+
+ 
+
+Each
+of the officers and directors who will assist us in sourcing potential acquisition targets has an interest in the founder shares as of
+the date hereof. These officers and directors will not receive any cash compensation from us prior to a business combination but will
+share in any appreciation of the founder shares, provided that we successfully complete a business combination. We believe that this
+structure aligns the incentives of these officers and directors with the interests of our shareholders. However, investors should be
+aware that, as these officers and directors have paid approximately $0.009 per share or less for the interest in the founder shares,
+this structure also creates an incentive whereby our officers and directors could potentially make a substantial profit even if we complete
+a business combination with a target that ultimately declines in value and is not profitable for our public shareholders
+
+ 
+
+We
+may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely
+affect our leverage and financial condition and thus negatively impact the value of our shareholders investment in us.
+
+ 
+
+Although
+we have no commitments as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding
+debt following this offering, we may choose to incur substantial debt to complete our initial business combination. We and our officers
+have agreed that we will not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or
+claim of any kind in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available
+for redemption from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including:
+
+ 
+
+ 
+ 
+ 
+ default
+ and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt
+ obligations;
+
+ 
+ 
+ 
+
+ 
+ 
+ acceleration
+ of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants
+ that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such
+ financing while the debt security is outstanding;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ inability to pay dividends on our Class A ordinary shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ using
+ a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends
+ on our Class A ordinary shares if declared, our ability to pay expenses, make capital expenditures and acquisitions and fund other
+ general corporate purposes;
+
+ 
+ 
+
+ 57
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ limitations
+ on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ increased
+ vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
+ and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ limitations
+ on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements and execution
+ of our strategy and other purposes and other disadvantages compared to our competitors who have less debt.
+
+ 
+ 
+
+We
+may only be able to complete one business combination with the proceeds of this offering and the sale of the placement units, which will
+cause us to be solely dependent on a single business which may have a limited number of products or services. This lack of diversification
+may negatively impact our operations and profitability. Of the net proceeds from this offering and the sale of the placement units, $98,000,000
+(or $112,700,000 if the underwriters over-allotment option is exercised in full) will be available to complete our initial business
+combination and pay related fees and expenses, after taking into account $3,500,000 (or $4,025,000 if the over-allotment option is exercised
+in full) of deferred underwriting commissions being held in the trust account and the estimated offering expenses.
+
+ 
+
+We
+may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within
+a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business
+because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma
+financial statements with the SEC that present operating results and the financial condition of several target businesses as if they
+had been operated on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification
+may subject us to numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations
+or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete
+several business combinations in different industries or different areas of a single industry. Accordingly, the prospects for our success
+may be:
+
+ 
+
+ 
+ 
+ 
+ solely
+ dependent upon the performance of a single business, property or asset; or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ dependent
+ upon the development or market acceptance of a single or limited number of products, processes or services.
+
+ 
+ 
+
+This
+lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial
+adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
+
+ 
+
+In
+evaluating a prospective target business for our initial business combination, our management will rely on the availability of all of
+the funds from the sale of the placement units to be used as part of the consideration to the sellers in the initial business combination.
+If the sale of some or all of the placement units fails to close, for any reason, we may lack sufficient funds to consummate our initial
+business combination.
+
+ 
+
+Our
+sponsor has agreed to purchase an aggregate of up to 480,000 of the placement units (or 532,500 placement units if the over-allotment
+option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $4,800,000 ($5,325,000 if the over-allotment
+option is exercised in full), in a private placement that will close simultaneously with the closing of our initial business combination.
+Each placement unit consists of one Class A ordinary share and one warrant. Each whole warrant is exercisable to purchase one
+whole Class A ordinary share at $11.50 per share. These securities will also be worthless if we do not complete an initial business combination.
+The funds from the sale of forward-purchase shares may be used as part of the consideration to the sellers in our initial business combination,
+expenses in connection with our initial business combination or for working capital in the post-transaction company. The obligations
+under the forward-purchase agreement do not depend on whether any public shareholders elect to redeem their shares and provide us with
+a minimum funding level for the initial business combination.
+
+ 
+
+ 58
+
+ 
+
+ 
+
+ 
+
+If
+the sale of the placement units does not close for any reason, including by reason of the failure by the sponsor to fund the purchase
+price for its units, we may lack sufficient funds to consummate our initial business combination. The forward-purchase investor s
+obligations to purchase the units are subject to termination prior to the closing of the sale by mutual written consent of the parties.
+
+ 
+
+We
+may be able to complete only one business combination with the proceeds of this offering and the sale of the placement units, which will
+cause us to be solely dependent on a single business, which may have a limited number of products or services and limited operating activities.
+This lack of diversification may negatively impact our operating results and profitability.
+
+ 
+
+Of
+the net proceeds from this offering and the sale of the placement units, $98,000,000 after payment of $3,500,000 of deferred underwriting
+fees and the estimated offering expenses (or $112,700,000 after payment of $4,025,000 of deferred underwriting fees if the underwriters 
+over-allotment option is exercised in full) will be available to complete our initial business combination. We may effectuate our initial
+business combination with a single target business or multiple target businesses simultaneously or within a short period of time. However,
+we may not be able to effectuate our initial business combination with more than one target business because of various factors, including
+the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that
+present operating results and the financial condition of several target businesses as if they had been operated on a combined basis.
+By completing our initial business combination with only a single entity, our lack of diversification may subject us to numerous economic,
+competitive and regulatory developments.
+
+ 
+
+Further,
+we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other
+entities that may have the resources to complete several business combinations in different industries or different areas of a single
+industry. Accordingly, the prospects for our success may be:
+
+ 
+
+ 
+ 
+ 
+ solely
+ dependent upon the performance of a single business, property or asset, or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ dependent
+ upon the development or market acceptance of a single or limited number of products, processes or services.
+
+ 
+ 
+
+This
+lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial
+adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
+
+ 
+
+ 59
+
+ 
+
+ 
+
+ 
+
+We
+may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete
+our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability.
+
+ 
+
+If
+we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers
+to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make
+it more difficult for us, and delay our ability, to complete our initial business combination. With multiple business combinations, we
+could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
+(if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or
+products of the acquired companies in a single operating business. If we are unable to adequately address these risks, it could negatively
+impact our profitability and results of operations.
+
+ 
+
+We
+may issue our shares to investors in connection with our initial business combination at a price that is less than the prevailing market
+price of our shares at that time.
+
+ 
+
+In
+connection with our initial business combination, we may issue shares to investors in private placement transactions (so-called PIPE
+transactions). The purpose of such issuances will be to enable us to provide sufficient liquidity to the post-business combination entity.
+The price of the shares we issue may be less, and potentially significantly less, than the market price for our shares at such time.
+
+ 
+
+We
+may attempt to complete our initial business combination with a private company about which little information is available, which may
+result in a business combination with a company that is not as profitable as we suspected, if at all.
+
+ 
+
+In
+pursuing our acquisition strategy, we may seek to effectuate our initial business combination with a privately held company. By definition,
+very little public information generally exists about private companies, and we could be required to make our decision on whether to
+pursue a potential initial business combination on the basis of limited information, which may result in a business combination with
+a company that is not as profitable as we suspected, if at all.
+
+ 
+
+We
+may seek business combination opportunities with a high degree of complexity that require significant operational improvements, which
+could delay or prevent us from achieving our desired results.
+
+ 
+
+We
+may seek business combination opportunities with large, highly complex companies that we believe would benefit from operational improvements.
+While we intend to implement such improvements, to the extent that our efforts are delayed or we are unable to achieve the desired improvements,
+the initial business combination may not be as successful as we anticipate. To the extent we complete our initial business combination
+with a large complex business or entity with a complex operating structure, we may also be affected by numerous risks inherent in the
+operations of the business with which we combine, which could delay or prevent us from implementing our strategy. Although our management
+team will endeavor to evaluate the risks inherent in a particular target business and its operations, we may not be able to properly
+ascertain or assess all of the significant risk factors until we complete our initial business combination. If we are not able to achieve
+our desired operational improvements, or the improvements take longer to implement than anticipated, we may not achieve the gains that
+we anticipate. Furthermore, some of these risks and complexities may be outside of our control and leave us with no ability to control
+or reduce the chances that those risks and complexities will adversely impact a target business. Such combination may not be as successful
+as a combination with a smaller, less complex organization.
+
+ 
+
+If
+we pursue a target company with operations or opportunities outside of the United States for our initial business combination, we may
+face additional burdens in connection with investigating, agreeing to and completing such initial business combination, and if we effect
+such initial business combination, we would be subject to a variety of additional risks that may negatively impact our operations.
+
+ 
+
+If
+we pursue a target a company with operations or opportunities outside of the United States for our initial business combination, we would
+be subject to risks associated with cross-border business combinations, including in connection with investigating, agreeing to and completing
+our initial business combination, conducting due diligence in a foreign jurisdiction, having such transaction approved by any local governments,
+regulators or agencies and changes in the purchase price based on fluctuations in foreign exchange rates. If we effect our initial business
+combination with such a company, we would be subject to any special considerations or risks associated with companies operating in an
+international setting, including any of the following:
+
+ 
+
+ 
+ 
+ 
+ costs
+ and difficulties inherent in managing cross-border business operations and complying with different commercial and legal requirements
+ of overseas markets;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ rules
+ and regulations regarding currency redemption;
+
+ 
+ 
+
+ 
+ 
+ 
+ complex
+ corporate withholding taxes on individuals;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ laws
+ governing the manner in which future business combinations may be effected;
+
+ 
+ 
+
+ 60
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ exchange
+ listing and/or delisting requirements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ tariffs
+ and trade barriers;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ regulations
+ related to customs and import/export matters;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ local
+ or regional economic policies and market conditions;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ export
+ limits of raw materials and related in-country value-added processing requirements
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ unexpected
+ changes in regulatory requirements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ longer
+ payment cycles;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ tax
+ issues, such as tax law changes and variations in tax laws as compared to the United States;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ currency
+ fluctuations and exchange controls, including devaluations and other exchange rate movements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ rates
+ of inflation;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ liquidity
+ of domestic capital and lending markets and challenges
+ in collecting accounts receivable;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ compliance
+ with the U.S. Foreign Corrupt Practices Act of 1977, as amended (the "FCPA"), the U.K. Bribery Act 2010 (the "Bribery
+ Act") and similar laws in other countries, which prohibit U.S. companies and their intermediaries from engaging in bribery
+ or other prohibited payments to foreign officials and require companies to keep books and records that accurately and fairly reflect
+ the transactions of the company and to maintain an adequate system of internal accounting controls;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ cultural
+ and language differences;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ employment
+ regulations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ underdeveloped
+ or unpredictable legal or regulatory systems;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ corruption;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ protection
+ of intellectual property;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ social
+ unrest, crime, strikes, riots and civil disturbances;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ regime
+ changes and political upheaval;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ terrorist
+ attacks, natural disasters and wars;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ deterioration
+ of political relations with the United States; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ government
+ appropriation of assets.
+
+ 
+ 
+
+We
+may not be able to adequately address these additional risks. If we were unable to do so, we may be unable to complete such initial business
+combination, or, if we complete such combination, our operations might suffer, either of which may adversely impact our business, financial
+condition and results of operations.
+
+ 
+
+ 61
+
+ 
+
+ 
+
+ 
+
+We
+do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete
+our initial business combination with which a substantial majority of our shareholders do not agree.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will not provide a specified maximum redemption threshold, except that in
+no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 either immediately
+prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (such
+that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which
+may be contained in the agreement relating to our initial business combination. As a result, we may be able to complete our initial business
+combination even though a substantial majority of our public shareholders do not agree with the transaction and have redeemed their shares
+or, if we seek shareholder approval of our initial business combination and do not conduct redemptions in connection with our initial
+business combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our
+sponsor, officers, directors, advisors or any of their respective affiliates. In the event the aggregate cash consideration we would
+be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash
+conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not
+complete the initial business combination or redeem any shares, all Class A ordinary shares submitted for redemption will be returned
+to the holders thereof, and we instead may search for an alternate business combination.
+
+ 
+
+In
+order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their
+charters and other governing instruments, including their warrant agreements. We cannot assure you that we will not seek to amend our
+amended and restated memorandum and articles of association or governing instruments in a manner that will make it easier for us to complete
+our initial business combination that our shareholders may not support.
+
+ 
+
+In
+order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their
+charters and modified governing instruments, including their warrant agreements. For example, blank check companies have amended the
+definition of business combination, increased redemption thresholds, changed industry focus and extended the time to consummate an initial
+business combination and, with respect to their warrants, amended their warrant agreements to require the warrants to be exchanged for
+cash and/or other securities. Amending our amended and restated memorandum and articles of association will require the approval of a
+special resolution, being a resolution of a duly constituted general meeting of the Company that is passed by a majority of two thirds
+of the votes cast by, or on behalf of, the shareholders entitled to vote thereon and amending our warrant agreement will require a vote
+of holders of at least a majority of the public warrants and, solely with respect to any amendment to the terms of the placement warrants
+or any provision of our warrant agreement with respect to the placement warrants, a majority of the number of the then outstanding placement
+warrants.
+
+ 
+
+In
+addition, our amended and restated memorandum and articles of association will require us to provide our public shareholders with the
+opportunity to redeem their public shares for cash if we propose an amendment to our amended and restated memorandum and articles of
+association to (A) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection
+with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within
+12 months from the closing of this offering (subject to two three-month extensions of time by depositing
+into the trust account for each three month extension $1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised
+in full ($0.10 per unit in either case) or (B) with respect to any other material provisions relating to shareholders rights
+or pre-initial business combination activity. To the extent any such amendments would be deemed to fundamentally change the nature of
+any securities offered through this registration statement, we would register, or seek an exemption from registration for, the affected
+securities. We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate
+an initial business combination in order to effectuate our initial business combination.
+
+ 
+
+ 62
+
+ 
+
+ 
+
+ 
+
+We
+may reincorporate in another jurisdiction in connection with our initial business combination and such reincorporation may result in
+taxes imposed on shareholders or warrant holders.
+
+ 
+
+We
+may effect a business combination with a target company in another jurisdiction, reincorporate in the jurisdiction in which the target
+company or business is located or reincorporate in another jurisdiction. Such transactions may result in tax liability for a shareholder
+or warrant holder in the jurisdiction in which the shareholder or warrant holder is a tax resident (or in which its members are resident
+if it is a tax transparent entity), in which the target company is located, or in which we reincorporate. We do not intend to make any
+cash distributions to shareholders or warrant holders to pay such taxes. Shareholders and warrant holders may be subject to withholding
+taxes or other taxes with respect to their ownership of us after the reincorporation.
+
+ 
+
+The
+provisions of our amended and restated memorandum and articles of association that relate to our pre-business combination activity (and
+corresponding provisions of the agreement governing the release of funds from our trust account) may be amended with the approval of
+a special resolution, being a resolution of a duly constituted general meeting of the Company that is passed by a majority of two thirds
+of the votes cast by, or on behalf of, the shareholders entitled to vote thereon, which is a lower amendment threshold than that of some
+other blank check companies. It may be easier for us, therefore, to amend our amended and restated memorandum and articles of association
+to facilitate the completion of an initial business combination that some of our shareholders may not support.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will provide that any of its provisions related to pre-initial business combination
+activity (including the requirement to deposit proceeds of this offering and the private placement of units into the trust account and
+not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein
+and including to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption
+or liquidation is substantially reduced or eliminated) may be amended if approved by a special resolution, being a resolution of a duly
+constituted general meeting of the Company that is passed by a majority of two thirds of the votes cast by, or on behalf of, the shareholders
+entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may
+be amended if approved by holders of 65% of our ordinary shares entitled to vote thereon. We may not issue additional securities that
+can vote on amendments to our amended and restated memorandum and articles of association.
+
+ 
+
+Our
+initial shareholders, who will collectively beneficially own up to 22.96% of our outstanding ordinary shares upon the closing of this
+offering (including the placement shares and assuming they do not purchase any units in this offering), will participate in any vote
+to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote
+in any manner they choose. As a result, we may be able to amend the provisions of our amended and restated memorandum and articles of
+association, which govern our pre-initial business combination behavior more easily than some other blank check companies, and this may
+increase our ability to complete an initial business combination with which you do not agree. Our shareholders may pursue remedies against
+us for any breach of our amended and restated memorandum and articles of association.
+
+ 
+
+Our
+sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our
+amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to provide for the
+redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not
+complete our initial business combination within 12 months from the closing of this offering (subject to two three-month extensions of
+time by depositing into the trust account for each three month extension $1,000,000, or $1,150,000
+if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case) or (B) with respect to any
+other material provisions relating to shareholders rights or pre-initial business combination activity, unless we provide our
+public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price,
+payable in cash, equal to the aggregate amount then on deposit in the trust account (including interest, net of taxes), divided by the
+number of then outstanding public shares. These agreements are contained in a letter agreement that we have entered into with our sponsor,
+officers and directors. Our shareholders are not parties to, or third-party beneficiaries of, these agreements and, as a result, will
+not have the ability to pursue remedies against our sponsor, officers or directors for any breach of these agreements. As a result, in
+the event of a breach, our shareholders would need to pursue a shareholder derivative action, subject to applicable law.
+
+ 
+
+ 63
+
+ 
+
+ 
+
+ 
+
+Our
+letter agreement with our sponsor, directors and officers may be amended without shareholder approval.
+
+ 
+
+Our
+letter agreement with our sponsor, directors and officers contains provisions relating to transfer restrictions of our founder shares
+and sponsor warrants, indemnification of the trust account, waiver of redemption rights and participation in liquidation distributions
+from the trust account. This letter agreement may be amended without shareholder approval (although releasing the parties from the restriction
+not to transfer our founder shares for 180 days following the date of this prospectus will require the prior written consent of the underwriters).
+Moreover, certain other agreements relating to this offering may be amended without shareholder approval. While we do not expect our
+board to approve any amendment to these agreements prior to our initial business combination, it may be possible that our board, in exercising
+its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to this agreement. Any such amendments
+to the letter agreement would not require approval from our shareholders and may have an adverse effect on the value of an investment
+in our securities.
+
+ 
+
+We
+may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target
+business, which could compel us to restructure or abandon a particular business combination. If we do not complete our initial business
+combination, our public shareholders may only receive their pro rata portion of the funds in the trust account that are available for
+distribution to public shareholders.
+
+ 
+
+We
+have not selected any specific business combination target but intend to target businesses with enterprise values that are greater than
+we could acquire with the net proceeds of this offering and the sale of the placement units. As a result, if the cash portion of the
+purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemption by public shareholders,
+we may be required to seek additional financing to complete such proposed initial business combination. We cannot assure you that such
+financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed
+to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular
+business combination and seek an alternative target business candidate. Further, we may be required to obtain additional financing in
+connection with the closing of our initial business combination for general corporate purposes, including for maintenance or expansion
+of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our
+initial business combination, or to fund the purchase of other companies. If we are unable to complete our initial business combination,
+our public shareholders may receive only approximately $10.15 per share plus any pro rata interest earned on the funds held in
+the trust account and not previously released to us to pay our taxes on the liquidation of our trust account and our warrants will expire
+worthless. In addition, even if we do not need additional financing to complete our initial business combination, we may require such
+financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse
+effect on the continued development or growth of the target business. None of our sponsor, officers, directors or shareholders is required
+to provide any financing to us in connection with or after our initial business combination. Further, as described in the risk factor
+entitled "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share
+redemption amount received by shareholders may be less than $10.15 per share," under certain circumstances our public shareholders
+may receive less than $10.15 per share upon the liquidation of the trust account.
+
+ 
+
+Holders
+of our Class A ordinary shares will not be entitled to vote on any appointment of directors we hold prior to our initial business combination.
+
+ 
+
+Prior
+to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors.
+Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, prior to the
+completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors
+for any reason. Accordingly, you may not have any say in the management of our company prior to the completion of an initial business
+combination.
+
+ 
+
+We
+are not registering the Class A ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities
+laws at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor
+from being able to exercise its warrants except on a cashless basis. 
+
+ 
+
+ 64
+
+ 
+
+ 
+
+ 
+
+If
+the issuance of the shares upon exercise of warrants is not registered, qualified or exempt from registration or qualification, the holder
+of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless.
+
+ 
+
+We
+are not registering the Class A ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities
+laws at this time. However, under the terms of the warrant agreement, we have agreed that as soon as practicable, but in no event later
+than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration
+statement for the registration under the Securities Act of the Class A ordinary shares issuable upon exercise of the warrants and thereafter
+will use our best efforts to cause the same to become effective within 60 business days following our initial business combination and
+to maintain a current prospectus relating to the Class A ordinary shares issuable upon exercise of the warrants, until the expiration
+of the warrants in accordance with the provisions of the warrant agreement. We cannot assure you that we will be able to do so if, for
+example, any facts or events arise which represent a fundamental change in the information set forth in the registration statement or
+prospectus, the financial statements contained or incorporated by reference therein are not current or correct or the SEC issues a stop
+order. If the shares issuable upon exercise of the warrants are not registered under the Securities Act, we will be required to permit
+holders to exercise their warrants on a cashless basis. However, no warrant will be exercisable for cash or on a cashless basis, and
+we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such
+exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration
+is available. Further, if an exemption from registration is not available, holders would not be
+able to exercise on a cashless basis and would only be able to exercise their warrants for cash if a current and effective prospectus
+relating to the Class A ordinary shares issuable upon exercise of the warrants is available.
+
+ 
+
+Notwithstanding
+the foregoing, if a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective
+within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there
+is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement,
+exercise warrants on a "cashless basis" pursuant to the exemption provided by Section 3(a)(9) of the Securities Act; provided
+that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their
+warrants on a cashless basis. In no event will we be required to net cash settle any warrant, or issue securities or other compensation
+in exchange for the warrants in the event that we are unable to register or qualify the shares underlying the warrants under applicable
+state securities laws and there is no exemption available.
+
+ 
+
+If
+the issuance of the shares upon exercise of the warrants is not so registered or qualified or exempt from registration or qualification,
+the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In
+such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price solely for
+the Class A ordinary shares included in the units. If and when the warrants become redeemable by us, we may not exercise our redemption
+right if the issuance of ordinary shares upon exercise of the warrants is not exempt from registration or qualification under applicable
+state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify
+such ordinary shares under the blue-sky laws of the state of residence in those states in which the warrants were initially offered by
+us in this offering. However, there may be instances in which holders of our public warrants may be unable to exercise such public warrants,
+but holders of our placement warrants may be able to exercise such placement warrants.
+
+ 
+
+ 65
+
+ 
+
+ 
+
+ 
+
+If
+you exercise your public warrants on a "cashless basis," you will receive fewer Class A ordinary shares from such exercise
+than if you were to exercise such warrants for cash.
+
+ 
+
+Under
+the following circumstances, the exercise of the public warrants may be required or permitted to be made on a cashless basis: (i) If
+a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th business
+day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration
+statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a "cashless
+basis" in accordance with Section 3(a)(9) of the Securities Act or another exemption; (ii) if our ordinary shares are at the time
+of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a "covered security"
+under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to
+do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will
+not be required to file or maintain in effect a registration statement; and in the event we do not so elect, we will use our best efforts
+to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available; and (iii) if we call the
+public warrants for redemption under certain circumstances described in the warrant agreement. In the event of an exercise on a cashless
+basis, a holder would pay the warrant exercise price by surrendering the warrants for that number of Class A ordinary shares calculated
+under the applicable provision in the warrant agreement. As a result, you would receive fewer Class A ordinary shares from such exercise
+than if you were to exercise such warrants for cash. This will have the effect of reducing the
+potential "upside" of the holder s investment in our company.
+
+ 
+
+Because
+we must furnish our shareholders with target business financial statements, we may lose the ability to complete an otherwise advantageous
+initial business combination with some prospective target businesses.
+
+ 
+
+The
+federal proxy rules require that a proxy statement with respect to a vote on a business combination meeting certain financial significance
+tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement
+disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial
+statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United
+States of America ("GAAP"), or international financial reporting standards as issued by the International Accounting Standards
+Board ("IFRS"), depending on the circumstances and the historical financial statements may be required to be audited in accordance
+with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"). These financial statement
+requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such statements
+in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination within
+the prescribed time frame.
+
+ 
+
+Compliance
+obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate a business combination, require substantial
+financial and management resources, and increase the time and costs of completing an acquisition.
+
+ 
+
+Section
+404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report
+on Form 10-K for the year ending November 30, 2022. Only in the event we are deemed to be a large-accelerated filer or an accelerated
+filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting
+firm attestation requirement on our internal control over financial reporting. Further, for as long as we remain an emerging growth company,
+we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control
+over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act
+particularly burdensome on us as compared to other public companies because a target business with which we seek to complete our initial
+business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls.
+The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and
+costs necessary to complete any such acquisition.
+
+ 
+
+Provisions
+in our amended and restated memorandum and articles of association and the Companies Act may inhibit a takeover of us, which could limit
+the price investors might be willing to pay in the future for Class A ordinary shares and could entrench management. Our amended and
+restated memorandum and articles of association will contain provisions that may discourage unsolicited takeover proposals that shareholders
+may consider to be in their best interests. These provisions will include a staggered board of directors and the ability of the board
+of directors to designate the terms of and issue new series of preference shares, and the fact that prior to the completion of our initial
+business combination only holders of our founder shares, which have been issued to our sponsor, are entitled to vote on the appointment
+of directors, which may make more difficult the removal of management and may discourage transactions that otherwise could involve payment
+of a premium over prevailing market prices for our securities.
+
+ 
+
+ 66
+
+ 
+
+ 
+
+ 
+
+We
+are also subject to anti-takeover provisions under the Companies Act, which could delay or prevent a change of control. Together these
+provisions may make the removal of management more difficult and may discourage transactions that otherwise could involve payment of
+a premium over prevailing market prices for our securities.
+
+ 
+
+Because
+we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to
+protect your rights through courts in the United States may be limited.
+
+ 
+
+We
+are an exempted company incorporated under the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service
+of process within the United States upon our directors or officers, or enforce judgments obtained in the United States courts against
+our directors or officers.
+
+ 
+
+Our
+corporate affairs will be governed by our amended and restated memorandum and articles of association, the Companies Act (as the same
+may be supplemented or amended from time to time) and the common law of the Cayman Islands. We will also be subject to the federal securities
+laws of the United States. The rights of shareholders to take action against the directors, actions by minority shareholders and the
+fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman
+Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands
+as well as from English common law, the decisions of whose courts are of persuasive authority, but are not binding on a court in the
+Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are different
+from what they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands
+has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed
+and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholders
+derivative action in a federal court of the United States.
+
+ 
+
+We
+have been advised by our Cayman Islands legal counsel that there is uncertainty as to whether the courts of the Cayman Islands would
+(i) recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal
+securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, impose liabilities against
+us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities
+imposed by those provisions are penal in nature. We have been advised by our Cayman Islands legal counsel that the courts of the Cayman
+Islands would recognize as a valid judgment, a final and conclusive judgment in personam obtained in the federal or state courts
+of the United States against our company under which a sum of money is payable (other than a sum of money payable in respect of multiple
+damages, taxes or other charges of a like nature or in respect of a fine or other penalty) or, in certain circumstances, an in personam
+judgment for non-monetary relief, and would give a judgment based thereon provided that (a) such courts had proper jurisdiction over
+the parties subject to such judgment, (b) such courts did not contravene the rules of natural justice of the Cayman Islands, (c) such
+judgment was not obtained by fraud, (d) the enforcement of the judgment would not be contrary to the public policy of the Cayman Islands,
+(e) no new admissible evidence relevant to the action is submitted prior to the rendering of the judgment by the courts of the Cayman
+Islands, and (f) there is due compliance with the correct procedures under the laws of the Cayman Islands.
+
+ 
+
+As
+a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken
+by management, members of the board of directors or controlling shareholders than they would as public shareholders of a United States
+company.
+
+ 
+
+Provisions
+in our amended and restated memorandum and articles of association may inhibit a takeover of us, which could limit the price investors
+might be willing to pay in the future for our Class A ordinary shares and could entrench management.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will contain provisions that may discourage unsolicited takeover proposals
+that shareholders may consider to be in their best interests. These provisions include a staggered board of directors and the ability
+of the board of directors to designate the terms of and issue new series of preference shares,
+which may make the removal of management more difficult and may discourage transactions that otherwise could involve payment of a premium
+over prevailing market prices for our securities.
+
+ 
+
+ 67
+
+ 
+
+ 
+
+ 
+
+Risks
+Associated with Acquiring and Operating a Business in Foreign Countries
+
+ 
+
+If
+we effect our initial business combination with a company located outside of the United States, we would be subject to a variety of additional
+risks that may adversely affect us.
+
+ 
+
+If
+we pursue a target company with operations or opportunities outside of the United States for our initial business combination, we may
+face additional burdens in connection with investigating, agreeing to and completing such initial business combination, and if we effect
+such initial business combination, we would be subject to a variety of additional risks that may negatively impact our operations. If
+we pursue a target a company with operations or opportunities outside of the United States for our initial business combination, we would
+be subject to risks associated with cross-border business combinations, including in connection with investigating, agreeing to and completing
+our initial business combination, conducting due diligence in a foreign jurisdiction, having such transaction approved by any local governments,
+regulators or agencies and changes in the purchase price based on fluctuations in foreign exchange rates.
+
+ 
+
+If
+we effect our initial business combination with such a company, we would be subject to any special considerations or risks associated
+with companies operating in an international setting, including any of the following:
+
+ 
+
+ 
+ 
+ 
+ costs
+ and difficulties inherent in managing cross-border business operations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ rules
+ and regulations regarding currency redemption;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ complex
+ corporate withholding taxes on individuals;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ laws
+ governing the manner in which future business combinations may be effected;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ exchange
+ listing and/or delisting requirements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ tariffs
+ and trade barriers;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ regulations
+ related to customs and import/export matters;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ local
+ or regional economic policies and market conditions;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ unexpected
+ changes in regulatory requirements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ challenges
+ in managing and staffing international operations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ longer
+ payment cycles;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ tax
+ issues, such as tax law changes and variations in tax laws as compared to the United States;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ currency
+ fluctuations and exchange controls;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ rates
+ of inflation;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ challenges
+ in collecting accounts receivable;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ cultural
+ and language differences;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ employment
+ regulations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ underdeveloped
+ or unpredictable legal or regulatory systems;
+
+ 
+
+ 
+
+ 68
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ corruption;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ protection
+ of intellectual property;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ social
+ unrest, crime, strikes, riots and civil disturbances;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ regime
+ changes and political upheaval;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ terrorist
+ attacks and wars; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ deterioration
+ of political relations with the United States.
+
+ 
+ 
+
+We
+may not be able to adequately address these additional risks. If we were unable to do so, we may be unable to complete such initial business
+combination, or, if we complete such initial business combination, our operations might suffer, either of which may adversely impact
+our business, financial condition and results of operations.
+
+ 
+
+If
+our management following our initial business combination is unfamiliar with United States securities laws, they may have to expend time
+and resources becoming familiar with such laws, which could lead to various regulatory issues.
+
+ 
+
+Following
+our initial business combination, our management may resign from their positions as officers or directors of the company and the management
+of the target business at the time of the business combination will remain in place. Management of the target business may not be familiar
+with United States securities laws. If new management is unfamiliar with United States securities laws, they may have to expend time
+and resources becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory issues
+which may adversely affect our operations.
+
+ 
+
+After
+our initial business combination, substantially all of our assets may be located in a foreign country and substantially all of our revenue
+will be derived from our operations in such country. Accordingly, our results of operations and prospects will be subject, to a significant
+extent, to the economic, political and legal policies, developments and conditions in the country in which we operate.
+
+ 
+
+The
+economic, political and social conditions, as well as government policies, of the country in which our operations are located could affect
+our business. Economic growth could be uneven, both geographically and among various sectors of the economy and such growth may not be
+sustained in the future. If in the future such country s economy experiences a downturn or grows at a slower rate than expected,
+there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially
+and adversely affect our ability to find an attractive target business with which to consummate our initial business combination and
+if we effect our initial business combination, the ability of that target business to become profitable.
+
+ 
+
+Exchange
+rate fluctuations and currency policies may cause a target business ability to succeed in the international markets to be diminished.
+
+ 
+
+In
+the event we acquire a non-U.S. target, all revenues and income would likely be received in a foreign currency, and the dollar equivalent
+of our net assets and distributions, if any, could be adversely affected by reductions in the value of the local currency. The value
+of the currencies in our target regions fluctuate and are affected by, among other things, changes in political and economic conditions.
+Any change in the relative value of such currency against our reporting currency may affect the attractiveness of any target business
+or, following consummation of our initial business combination, our financial condition and results of operations. Additionally, if a
+currency appreciates in value against the dollar prior to the consummation of our initial business combination, the cost of a target
+business as measured in dollars will increase, which may make it less likely that we are able to consummate such transaction.
+
+ 
+
+ 69
+
+ 
+
+ 
+
+ 
+
+We
+may reincorporate in another jurisdiction in connection with our initial business combination, and the laws of such jurisdiction may
+govern some or all of our future material agreements and we may not be able to enforce our legal rights.
+
+ 
+
+In
+connection with our initial business combination, we may relocate the home jurisdiction of our business from the Cayman Islands to another
+jurisdiction. If we determine to do this, the laws of such jurisdiction may govern some or all of our future material agreements. The
+system of laws and the enforcement of existing laws in such jurisdiction may not be as certain in implementation and interpretation as
+in the United States. The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss
+of business, business opportunities or capital.
+
+ 
+
+We
+are subject to changing law and regulations regarding regulatory matters, corporate governance and public disclosure that have increased
+both our costs and the risk of non-compliance.
+
+ 
+
+We
+are subject to rules and regulations by various governing bodies, including, for example, the SEC, which are charged with the protection
+of investors and the oversight of companies whose securities are publicly traded, and to new and evolving regulatory measures under applicable
+law. Our efforts to comply with new and changing laws and regulations have resulted in and are likely to continue to result in, increased
+general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance
+activities.
+
+ 
+
+Moreover,
+because these laws, regulations and standards are subject to varying interpretations, their application in practice may evolve over time
+as new guidance becomes available. This evolution may result in continuing uncertainty regarding compliance matters and additional costs
+necessitated by ongoing revisions to our disclosure and governance practices. If we fail to address and comply with these regulations
+and any subsequent changes, we may be subject to penalty and our business may be harmed.
+
+ 
+
+We
+may be exposed to liabilities under the Foreign Corrupt Practices Act, and any determination that we violated the Foreign Corrupt Practices
+Act could have a material adverse effect on our business.
+
+ 
+
+We
+are subject to the Foreign Corrupt Practice Act, or FCPA, and other laws that prohibit improper payments or offers of payments to foreign
+governments and their officials and political parties by U.S. persons and issuers as defined by the statute for the purpose of obtaining
+or retaining business. If we consummate our initial business combination with an entity in a non-U.S. jurisdiction, we will have operations,
+agreements with third parties and may make sales overseas, which may experience corruption. Activities overseas may create the risk of
+unauthorized payments or offers of payments by one of the employees, consultants, or sales agents of our Company, because these parties
+are not always subject to our control. It will be our policy to implement safeguards to discourage these practices by our employees.
+Also, our existing safeguards and any future improvements may prove to be less than effective, and the employees, consultants, or sales
+agents of our Company may engage in conduct for which we might be held responsible. Violations of the FCPA may result in severe criminal
+or civil sanctions, and we may be subject to other liabilities, which could negatively affect our business, operating results and financial
+condition. In addition, the government may seek to hold our Company liable for successor liability FCPA violations committed by companies
+in which we invest or that we acquire.
+
+ 
+
+Many
+countries have difficult and unpredictable legal systems and underdeveloped laws and regulations that are unclear and subject to corruption
+and inexperience, which may adversely impact our results of operations and financial condition.
+
+ 
+
+Our
+ability to seek and enforce legal protections, including with respect to intellectual property and other property rights, or to defend
+ourselves with regard to legal actions taken against us in a given country, may be difficult or impossible, which could adversely impact
+our operations, assets or financial condition. Rules and regulations in many countries are often ambiguous or open to differing interpretation
+by responsible individuals and agencies at the municipal, state, regional and federal levels. The attitudes and actions of such individuals
+and agencies are often difficult to predict and inconsistent. Delay with respect to the enforcement of particular rules and regulations,
+including those relating to customs, tax, environmental and labor, could cause serious disruption to operations abroad and negatively
+impact our results.
+
+ 
+
+If
+relations between the United States and foreign governments deteriorate, it could cause potential target businesses or their goods and
+services to become less attractive.
+
+ 
+
+The
+relationship between the United States and foreign governments could be subject to sudden fluctuation and periodic tension. For instance,
+the United States may announce its intention to impose quotas on certain imports. Such import quotas may adversely affect political relations
+between the two countries and result in retaliatory countermeasures by the foreign government in industries that may affect our ultimate
+target business. Changes in political conditions in foreign countries and changes in the state of U.S. relations with such countries
+are difficult to predict and could adversely affect our operations or cause potential target businesses or their goods and services to
+become less attractive. Because we are not limited to any specific industry, there is no basis for investors in this offering to evaluate
+the possible extent of any impact on our ultimate operations if relations are strained between the United States and a foreign country
+in which we acquire a target business or move our principal manufacturing or service operations.
+
+ 
+
+ 70
+
+ 
+
+ 
+
+ 
+
+If
+a foreign country enacts regulations in industry segments that forbid or restrict foreign investment, our ability to consummate our initial
+business combination could be severely impaired.
+
+ 
+
+Many
+of the rules and regulations that companies face concerning foreign ownership are not explicitly communicated. If new laws or regulations
+forbid or limit foreign investment in industries in which we want to complete our initial business combination, they could severely impair
+our candidate pool of potential target businesses. Additionally, if the relevant central and local authorities find us or the target
+business with which we ultimately complete our initial business combination to be in violation of any existing or future laws or regulations,
+they would have broad discretion in dealing with such a violation, including, without limitation:
+
+ 
+
+ 
+ 
+ 
+ 
+ levying
+ fines;
+
+ 
+ 
+ 
+ 
+ revoking
+ our business and other licenses;
+
+ 
+ 
+ 
+ 
+ requiring
+ that we restructure our ownership or operations; and
+
+ 
+ 
+ 
+ 
+ requiring
+ that we discontinue any portion or all of our business.
+
+ 
+ 
+
+Any
+of the above could have an adverse effect on our company post-business combination and could materially reduce the value of your investment.
+
+ 
+
+Corporate
+governance standards in some foreign countries may not be as strict or developed as in the United States and such weakness may hide issues
+and operational practices that are detrimental to a target business.
+
+ 
+
+General
+corporate governance standards in some countries are weak in that they do not prevent business practices that cause unfavorable related
+party transactions, over-leveraging, improper accounting, family company interconnectivity and poor management. Local laws often do not
+go far enough to prevent improper business practices. Therefore, shareholders may not be treated impartially and equally as a result
+of poor management practices, asset shifting, conglomerate structures that result in preferential treatment to some parts of the overall
+company, and cronyism. The lack of transparency and ambiguity in the regulatory process also may result in inadequate credit evaluation
+and weakness that may precipitate or encourage financial crisis. In our evaluation of a business combination we will have to evaluate
+the corporate governance of a target and the business environment, and in accordance with United States laws for reporting companies
+take steps to implement practices that will cause compliance with all applicable rules and accounting practices. Notwithstanding these
+intended efforts, there may be endemic practices and local laws that could add risk to an investment we ultimately make and that result
+in an adverse effect on our operations and financial results.
+
+ 
+
+Risks
+Relating to the Post-Business Combination Company
+
+ 
+
+Subsequent
+to the completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment
+or other charges that could have a significant negative effect on our financial condition, results of operations and our share price,
+which could cause you to lose some or all of your investment.
+
+ 
+
+Even
+if we conduct due diligence on a target business with which we combine, we cannot assure you that this diligence will surface all material
+issues with a particular target business, that it would be possible to uncover all material issues through a customary amount of due
+diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of these factors,
+we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other charges that could
+result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously
+known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash
+items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative
+market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other covenants
+to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining post-combination
+debt financing.
+
+ 
+
+Accordingly,
+any shareholders who choose to remain shareholders following the initial business combination could suffer a reduction in the value of
+their securities. Such shareholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim
+that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they
+are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable,
+relating to the initial business combination contained an actionable material misstatement or material omission.
+
+ 
+
+ 71
+
+ 
+
+ 
+
+ 
+
+The
+officers and directors of an acquisition candidate may resign upon completion of our initial business combination. The loss of a business
+combination target s key personnel could negatively impact the operations and profitability of our post-combination business.
+
+ 
+
+The
+role of an acquisition candidate s key personnel upon the completion of our initial business combination cannot be ascertained
+at this time. Although we contemplate that, certain members of an acquisition candidate s management team will remain associated
+with the acquisition candidate following our initial business combination, it is possible that members of the management of an acquisition
+candidate will not wish to remain in place.
+
+ 
+
+Our
+management may not be able to maintain control of a target business after our initial business combination. Upon the loss of control
+of a target business, new management may not possess the skills, qualifications or abilities necessary to profitably operate such business.
+
+ 
+
+We
+may structure our initial business combination so that the post-transaction company in which our public shareholders own shares will
+own less than 100% of the equity interests or assets of a target business, but we will only complete such business combination if the
+post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling
+interest in the target sufficient for us not to be required to register as an investment company under the Investment Company Act. We
+will not consider any transaction that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting
+securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the
+post business combination company, depending on valuations ascribed to the target and us in the initial business combination. For example,
+we could pursue a transaction in which we issue a substantial number of new Class A ordinary shares in exchange for all of the outstanding
+capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% interest in the target. However, as
+a result of the issuance of a substantial number of new Class A ordinary shares, our shareholders immediately prior to such transaction
+could own less than a majority of our issued and outstanding Class A ordinary shares subsequent to such transaction. In addition, other
+minority shareholders may subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company s
+shares than we initially acquired. Accordingly, this may make it more likely that our management will not be able to maintain control
+of the target business.
+
+ 
+
+We
+may have a limited ability to assess the management of a prospective target business and, as a result, may affect our initial business
+combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company.
+
+ 
+
+When
+evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the
+target business s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities
+of the target business s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications
+or abilities we suspected. Should the target business s management not possess the skills, qualifications or abilities necessary
+to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly,
+any shareholders who choose to remain shareholders following the initial business combination could suffer a reduction in the value of
+their shares. Such shareholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim
+that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they
+are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable,
+relating to the initial business combination contained an actionable material misstatement or material omission.
+
+ 
+
+Risks
+Relating to Our Management Team
+
+ 
+
+We
+are dependent upon our executive officers and directors and their loss could adversely affect our ability to operate.
+
+ 
+
+Our
+operations are dependent upon a relatively small group of individuals and, in particular, our executive officers and directors. We believe
+that our success depends on the continued service of our officers and directors, at least until we have completed our initial business
+combination. In addition, our executive officers and directors are not required to commit any specified amount of time to our affairs
+and, accordingly, will have conflicts of interest in allocating their time among various business activities, including identifying potential
+business combinations and monitoring the related due diligence. Moreover, certain of our directors and executive officers have time and
+attention requirements for other employment, executive positions, director positions and management duties. We do not have an employment
+agreement with, or key-man insurance on the life of, any of our directors or executive officers. The unexpected loss of the services
+of one or more of our directors or executive officers could have a detrimental effect on us.
+
+ 
+
+ 72
+
+ 
+
+ 
+
+ 
+
+Our
+ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the efforts
+of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively
+impact the operations and profitability of our post-combination business.
+
+ 
+
+Our
+ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key
+personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target
+business in senior management, director or advisory positions following our initial business combination, it is likely that some or all
+of the management of the target business will remain in place. While we intend to closely scrutinize any individuals we engage after
+our initial business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals
+may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and
+resources helping them become familiar with such requirements. This could be expensive and time-consuming and could lead to various regulatory
+issues which may adversely affect our operations.
+
+ 
+
+Our
+key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination,
+and a particular business combination may be conditioned on the retention or resignation of such key personnel. These agreements may
+provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts
+of interest in determining whether a particular business combination is the most advantageous.
+
+ 
+
+Our
+key personnel may be able to remain with our company after the completion of our initial business combination only if they are able to
+negotiate employment or consulting agreements in connection with the initial business combination. Such negotiations would take place
+simultaneously with the negotiation of the initial business combination and could provide for such individuals to receive compensation
+in the form of cash payments and/or our securities for services they would render to us after the completion of the initial business
+combination. Such negotiations also could make such key personnel s retention or resignation a condition to any such agreement.
+The personal and financial interests of such individuals may influence their motivation in identifying and selecting a target business,
+subject to his or her fiduciary duties under the Companies Act. However, we believe the ability of such individuals to remain with us
+after the completion of our initial business combination will not be the determining factor in our decision as to whether or not we will
+proceed with any potential business combination. There is no certainty, however, that any of our key personnel will remain with us after
+the completion of our initial business combination. We cannot assure you that any of our key personnel will remain in senior management
+or advisory positions with us. The determination as to whether any of our key personnel will remain with us will be made at the time
+of our initial business combination.
+
+ 
+
+Our
+executive officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination
+as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial
+business combination.
+
+ 
+
+Our
+executive officers and directors are not required to, and will not, commit their full time to our affairs, which may result in a conflict
+of interest in allocating their time between our operations and our search for a business combination and their other businesses. We
+do not intend to have any full-time employees prior to the completion of our initial business combination. Each of our executive officers
+and directors is engaged in several other business endeavors for which he may be entitled to substantial compensation, and our executive
+officers and directors are not obligated to contribute any specific number of hours per week to our affairs. Our independent directors
+also serve as officers and board members for other entities. If our executive officers and directors other business affairs
+require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their
+ability to devote time to our affairs which may have a negative impact on our ability to complete our initial business combination. For
+a complete discussion of our executive officers and directors other business affairs, please see the section of this prospectus
+entitled "Management — Officers, Directors and Independent Directors."
+
+ 
+
+ 73
+
+ 
+
+ 
+
+ 
+
+Following
+the completion of this offering and until we complete our initial business combination, we intend to engage in the business of identifying
+and combining with one or more businesses. Our sponsor, its members, and our officers and directors are, or may in the future become,
+affiliated with entities (such as operating companies or investment vehicles) that are engaged in a similar business. We do not have
+employment contracts with our officers and directors that will limit their ability to work at other businesses. Each of our officers
+and directors presently has, and any of them in the future may have, additional fiduciary or contractual obligations to other entities
+pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity, subject
+to his or her fiduciary duties under the Companies Act.
+
+ 
+
+In
+particular, Tek Che Ng, our Chief Executive Officer and Chairman of the Board, and Chow Wing Loke, our Chief Financial Officer, may serve
+in the same or similar capacities in other businesses, which may present additional conflicts of interest in pursuing an acquisition
+target. These conflicts may not be resolved in our favor and a potential target business may be presented to such other blank check companies
+prior to its presentation to us, subject to our officers and directors fiduciary duties under the Companies Act. Our amended
+and restated memorandum and articles of association will provide that we renounce our interest in any business combination opportunity
+offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director
+or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. For a complete discussion of our
+executive officers and directors business affiliations and the potential conflicts of interest that you should be aware
+of, please see the sections of this prospectus entitled "Management — Officers, Directors and Independent Directors,"
+"Management — Conflicts of Interest" and "Certain Relationships and Related Party Transactions."
+
+ 
+
+Involvement
+of members of our management and companies with which they are affiliated in civil disputes and litigation, governmental investigations
+or negative publicity unrelated to our business affairs could materially impact our ability to consummate an initial business combination.
+
+ 
+
+Our
+directors and officers and companies with which they are affiliated have been, and in the future will continue to be, involved in a wide
+variety of business affairs, including transactions, such as sales and purchases of businesses, and ongoing operations. As a result of
+such involvement, members of our management and companies with which they are affiliated in have been, and may in the future be, involved
+in civil disputes, litigation, governmental investigations and negative publicity relating to their business affairs.
+
+ 
+
+Our
+executive officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict
+with our interests.
+
+ 
+
+We
+have not adopted a policy that expressly prohibits our directors, executive officers, security holders or affiliates from having a direct
+or indirect pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are
+a party or have an interest. In fact, we may enter into a business combination with a target business that is affiliated with our sponsor,
+our directors or executive officers, although we do not intend to do so. Nor do we have a policy that expressly prohibits any such persons
+from engaging for their own account in business activities of the types conducted by us, including the formation or participation in
+one or more other blank check companies. Accordingly, such persons or entities may have a conflict between their interests and ours.
+
+ 
+
+The
+personal and financial interests of our directors and officers may influence their motivation in timely identifying and selecting a target
+business and completing a business combination. Consequently, our directors and officers discretion in identifying and
+selecting a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of
+a particular business combination are appropriate and in the best interests of our shareholders. If this were the case, it would be a
+breach of their fiduciary duties to us as a matter of the Companies Act and we or our shareholders might have a claim against such individuals
+for infringing on our shareholders rights. See "Description of Securities — Certain Differences in Corporate Law —
+Shareholders Suits" for further information on the ability to bring such claims. However, we might not ultimately be successful
+in any claim we may make against them for such reason.
+
+ 
+
+ 74
+
+ 
+
+ 
+
+ 
+
+We
+may amend the terms of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of
+at least a majority of the then outstanding public warrants. As a result, the exercise price of your warrants could be increased, the
+exercise period could be shortened and the number of Class A ordinary shares purchasable upon exercise of a warrant could be decreased,
+all without your approval.
+
+ 
+
+Our
+warrants will be issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant
+agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure
+any ambiguity or correct any defective provision but requires the approval by the holders of at least a majority of the then outstanding
+public warrants to make any change that adversely affects the interests of the registered holders of public warrants. Accordingly, we
+may amend the terms of the public warrants in a manner adverse to a holder of public warrants if holders of at least a majority of the
+then outstanding public warrants approve of such amendment. Although our ability to amend the terms of the public warrants with the consent
+of at least a majority of the then outstanding public warrants is unlimited, examples of such amendments could be amendments to, among
+other things, increase the exercise price of the warrants, convert the warrants into cash or shares, shorten the exercise period or decrease
+the number of Class A ordinary shares purchasable upon exercise of a warrant.
+
+ 
+
+Our
+warrant agreement will designate the courts of the State of New York or the U.S. District Court for the Southern District of New York,
+as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants, which
+could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company.
+
+ 
+
+Our
+warrant agreement will provide that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating
+in any way to the warrant agreement, including under the Securities Act, will be brought and enforced in the courts of the State of New
+York or the United States District Court for the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction,
+which jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We will waive any objection to such exclusive
+jurisdiction and that such courts represent an inconvenient forum.
+
+ 
+
+Notwithstanding
+the foregoing, these provisions of the warrant agreement will not apply to suits brought to enforce any liability or duty created by
+the Securities Act and the Exchange Act or any other claim for which the federal district courts of the United States of America are
+the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest in any of our warrants shall be deemed
+to have notice of and to have consented to the forum provisions in our warrant agreement. If any action, the subject matter of which
+is within the scope the forum provisions of the warrant agreement, is filed in a court other than a court of the State of New York or
+the United States District Court for the Southern District of New York (a "foreign action") in the name of any holder of
+our warrants, such holder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located
+in the State of New York in connection with any action brought in any such court to enforce the forum provisions (an "enforcement
+action"), and (y) having service of process made upon such warrant holder in any such enforcement action by service upon such warrant
+holder s counsel in the foreign action as agent for such warrant holder.
+
+ 
+
+This
+choice-of-forum provision may limit a warrant holder s ability to bring a claim in a judicial forum that it finds favorable for
+disputes with our company, which may discourage such lawsuits. Alternatively, if a court were to find this provision of our warrant agreement
+inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs
+associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business, financial condition
+and results of operations and result in a diversion of the time and resources of our management and board of directors.
+
+ 
+
+ 75
+
+ 
+
+ 
+
+ 
+
+We
+may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
+
+ 
+
+We
+have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of
+$0.01 per warrant; provided that the reported closing price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted
+for share subdivisions, share dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day
+period ending on the third trading day prior to the date on which we give proper notice of such redemption to the warrant holders and
+provided certain other conditions are met. If and when the warrants become redeemable by us, we may not exercise our redemption right
+if the issuance of ordinary shares upon exercise of the warrants is not exempt from registration or qualification under applicable state
+blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such
+ordinary shares under the blue-sky laws of the state of residence in those states in which the warrants were initially offered by us
+in this offering. Redemption of the outstanding warrants could force you (i) to exercise your warrants and pay the exercise price therefor
+at a time when it may be disadvantageous for you to do so, (ii) to sell your warrants at the then-current market price when you might
+otherwise wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are
+called for redemption, is likely to be substantially less than the market value of your warrants.
+
+ 
+
+The
+value received upon exercise of the warrants (i) may be less than the value the holders would have received if they had exercised their
+warrants at a later time where the underlying share price is higher and (ii) may not compensate the holders for the value of the warrants,
+including because the number of Class A ordinary shares received is capped at 0.50 Class A ordinary shares per warrant (subject to adjustment)
+irrespective of the remaining life of the warrants.
+
+ 
+
+Risks
+Relating to Our Securities
+
+ 
+
+Nasdaq
+may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities
+and subject us to additional trading restrictions.
+
+ 
+
+We
+intend to apply to have our units approved for listing on Nasdaq on or promptly after the date of this prospectus. Following the date
+that the Class A ordinary shares and warrants are eligible to trade separately, we anticipate that the Class A ordinary shares and warrants
+will be separately listed on Nasdaq. Although after giving effect to this offering we expect to meet, on a pro forma basis, the minimum
+initial listing standards set forth in the Nasdaq listing standards, we cannot assure you that our securities will be, or will continue
+to be, listed on Nasdaq in the future or prior to our initial business combination. In order to continue listing our securities on Nasdaq
+prior to our initial business combination, we must maintain certain financial, distribution and share price levels.
+
+ 
+
+Generally,
+we must maintain a minimum market capitalization (generally $50,000,000) and a minimum number of holders of our securities (generally
+400 total holders). Additionally, in connection with our initial business combination, we will be required to demonstrate compliance
+with Nasdaq s initial listing requirements, which are more rigorous than Nasdaq s continued listing requirements, in order
+to continue to maintain the listing of our securities on Nasdaq. For instance, our share price would generally be required to
+be at least $4.00 per share and we would be required to have a minimum of 400 round lot holders (with at least 50% of such round lot
+holders holding securities with a market value of at least $2,500) of our securities. We cannot assure you that we will be able to meet
+those initial listing requirements at that time. If the Nasdaq delists our securities from trading on its exchange and we are not able
+to list our securities on another national securities exchange, we expect our securities could be quoted on an over-the-counter market.
+If this were to occur, we could face significant material adverse consequences, including:
+
+ 
+
+ 
+ 
+ 
+ a
+ limited availability of market quotations for our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ reduced
+ liquidity for our securities;
+
+ 
+ 
+
+ 76
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ a
+ determination that our Class A ordinary shares is a "penny stock" which will require brokers trading in our Class A ordinary
+ shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market
+ for our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ limited amount of news and analyst coverage; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ decreased ability to issue additional securities or obtain additional financing in the future.
+
+ 
+ 
+
+The
+National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the
+sale of certain securities, which are referred to as "covered securities." Because our units and eventually our Class A ordinary
+shares and warrants will be listed on Nasdaq,
+our units, Class A ordinary shares and warrants will be covered securities. Although the states are preempted from regulating the sale
+of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there
+is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. While we
+are not aware of a state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other
+than the State of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten
+to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer listed
+on Nasdaq, our securities would not be covered securities and we would be subject to regulation
+in each state in which we offer our securities, including in connection with our initial business combination.
+
+ 
+
+Our
+sponsor paid an aggregate of $25,000, or approximately $0.009 per founder share (assuming the over-allotment
+option is exercised in full and thus no forfeiture by our sponsor of any founder shares) and accordingly, you will experience immediate
+and substantial dilution upon the purchase of our Class A ordinary shares.
+
+ 
+
+The
+difference between the public offering price per share (allocating all of the unit purchase price to the Class A ordinary share and none
+to the warrant included in the unit) and the pro forma net tangible book value per Class A ordinary shares after this offering constitutes
+the dilution to you and the other investors in this offering. Our sponsor acquired the founder shares at a nominal price, significantly
+contributing to this dilution. Upon the closing of this offering, and assuming no value is ascribed to the warrants included in the units,
+you and the other public shareholders will incur an immediate and substantial dilution of approximately 109.1% (or $10.91 per share,
+assuming no exercise of the underwriters over-allotment option), the difference between the pro forma net tangible book value
+per share of $(0.91) and the initial offering price of $10.00 per unit. In addition, because of the anti-dilution rights of the founder
+shares, any equity or equity-linked securities issued or deemed issued in connection with our initial business combination would be disproportionately
+dilutive to our Class A ordinary shares and would be exacerbated to the extent the public shareholders seek redemptions from the trust
+account.
+
+ 
+
+Since
+our sponsor paid $25,000 approximately $0.009 per founder share (assuming the over-allotment option
+is exercised in full and thus no forfeiture by our sponsor of any founder shares), our officers and directors could potentially
+make a substantial profit even if we acquire a target business that subsequently declines in value.
+
+ 
+
+On
+November 26, 2021, our sponsor acquired 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.009
+per share. The founder shares will be convertible into Class A ordinary shares at a ratio of one to one, as described elsewhere in this
+prospectus. Our officers and directors have a significant economic interest in our sponsor. As a result of the low acquisition cost of
+our founder shares, our sponsor, its affiliates and our management team could make a substantial profit even if we select and consummate
+an initial business combination with an acquisition target that subsequently declines in value or is unprofitable for our public shareholders.
+Thus, such parties may have more of an economic incentive for us to enter into an initial business combination with a riskier, weaker-performing
+or financially unstable business, or an entity lacking an established record of revenues or earnings, than would be the case if such
+parties had paid the full offering price for their founder shares.
+
+ 
+
+ 77
+
+ 
+
+ 
+
+ 
+
+Our
+warrants and founder shares may have an adverse effect on the market price of the Class A ordinary shares and make it more difficult
+to effectuate our initial business combination.
+
+ 
+
+We
+will be issuing warrants to purchase 10,000,000 Class A ordinary shares (or up to 11,500,000 Class A ordinary shares if
+the underwriters over-allotment option is exercised in full) as part of the units offered by this prospectus and, simultaneously
+with the closing of this offering, we will be issuing in placement warrants to purchase an aggregate of 480,000 (or up to 532,500
+if the underwriters over-allotment option is exercised in full) Class A ordinary shares at $11.50 per share. Our initial shareholders
+currently own an aggregate of 2,875,000 founder shares, 375,000 of which are subject to forfeiture if the underwriters over-allotment
+option is not exercised in its entirety. The founder shares are convertible into Class A ordinary shares on a one-for-one basis, subject
+to adjustment as set forth herein. In addition, if our sponsor or an affiliate of our sponsor or certain of our officers and directors
+make any working capital loans, up to $1,500,000 of such loans may be converted into units, at the price of $10.00 per unit at the option
+of the lender. Such units would be identical to the placement units.
+
+ 
+
+To
+the extent we issue Class A ordinary shares to effectuate an initial business combination, the potential for the issuance of a substantial
+number of additional Class A ordinary shares upon exercise of these warrants and conversion rights could make us a less attractive business
+combination vehicle to a target business. Any such issuance will increase the number of issued and outstanding Class A ordinary shares
+and reduce the value of the Class A ordinary shares issued to complete the initial business combination. Therefore, our warrants and
+founder shares may make it more difficult to effectuate an initial business combination or increase the cost of acquiring the target
+business.
+
+ 
+
+The
+placement warrants including in the placement units are identical to the warrants sold as part of the units in this offering except that, they (including the
+Class A ordinary shares issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned
+or sold by our sponsor until 30 days after the completion of our initial business combination, and the holders thereof (including with respect to Class A ordinary shares issuable upon exercise of such warrants)
+are entitled to registration rights.
+
+ 
+
+A
+provision of our warrant agreement may make it more difficult for us to consummate an initial business combination.
+
+ 
+
+If:
+
+ 
+
+ 
+ 
+ (1)
+ we
+ issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing
+ of our initial business combination at a Newly Issued Price of less than $9.20 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ (2)
+ the
+ aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available
+ for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions),
+ and
+
+ 
+ 
+
+ 78
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ (3)
+ the
+ Market Value is below $9.20 per share,
+
+ 
+ 
+
+then
+the exercise price of the warrants will be adjusted to be equal to 115% of the higher of the Market Value and the Newly Issued Price,
+and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market
+Value and the Newly Issued Price, the $18.00 per share redemption trigger price described adjacent to "Redemption of warrants when
+the price per Class A ordinary shares equals or exceeds $18.00" will be adjusted (to the nearest cent) to be equal to 180% of the
+higher of the Market Value and the Newly Issued Price. This warrant provision may make it more difficult for us to consummate an initial
+business combination with a target business.
+
+ 
+
+The
+determination of the offering price of our units, the size of this offering and terms of the units is more arbitrary than the pricing
+of securities and size of an offering of an operating company in a particular industry. You may have less assurance, therefore, that
+the offering price of our units properly reflects the value of such units than you would have in a typical offering of an operating company.
+
+ 
+
+Prior
+to this offering there has been no public market for any of our securities. The public offering price of the units and the terms of the
+warrants were negotiated between us and the underwriters. In determining the size of this offering, management held customary organizational
+meetings with representatives of the underwriters, both prior to our inception and thereafter, with respect to the state of capital markets,
+generally, and the amount the underwriters believed they reasonably could raise on our behalf. Factors considered in determining the
+size of this offering, prices and terms of the units, including the Class A ordinary shares and warrants underlying the units, include:
+
+ 
+
+ 
+ 
+ 
+ the
+ history and prospects of companies whose principal business is the acquisition of other companies;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ prior
+ offerings of those companies;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ prospects for acquiring an operating business at attractive values;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ review of debt-to-equity ratios in leveraged transactions;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ capital structure;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an
+ assessment of our management and their experience in identifying operating companies;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ general
+ conditions of the securities markets at the time of this offering; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ other
+ factors as were deemed relevant.
+
+ 
+ 
+
+Although
+these factors were considered, the determination of our offering price is more arbitrary than the pricing of securities of an operating
+company in a particular industry since we have no historical operations or financial results.
+
+ 
+
+Due
+to certain provisions expected to be contained in our warrant agreement, the warrants may be treated as a derivative liability, which
+could cause us to recognize certain adverse changes to our financial statements from similar special purpose companies that do not have
+these provision.
+
+ 
+
+Due
+to certain provisions expected to be contained in our warrant agreement, both the public warrants and the placement warrants may be treated
+as a derivative liability and if so we will be required to record the fair value of each warrant as a liability in accordance with the
+guidance contained in ASC 815-40. As a result, each quarter, we will be required to determine the fair value of each warrant and record
+the change on the value of the warrants from the prior quarter as a gain or a loss on our income statement, which will change the value
+of the liability for the warrants on our balance sheet. This accounting treatment could cause the market to react negatively to our financial
+performance and the obligation of a company with which we pursue our initial business combination to continue this accounting treatment
+could make it less likely that we will be able to consummate our initial business combination.
+
+ 
+
+ 79
+
+ 
+
+ 
+
+ 
+
+We
+may issue additional Class A ordinary shares or preference shares to complete our initial business combination or under an employee incentive
+plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the founder
+shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions
+contained in our amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders
+and likely present other risks.
+
+ 
+
+Our
+amended and restated memorandum and articles of association authorizes the issuance of up to 479,000,000 Class A ordinary shares, par
+value $0.0001 per share, 20,000,000 Class B ordinary shares, par value $0.0001 per share, and 1,000,000 preference shares, par value
+$0.0001 per share. Immediately after this offering, there will be 10,480,000
+Class A ordinary shares (including 480,000 placement shares) issued
+and outstanding (assuming, in each case, that the underwriters have not exercised their over-allotment option) and 468,520,000 authorized
+but unissued Class A ordinary shares and 17,500,000 Class B ordinary shares available for issuance, which amount does not take into account
+the Class A ordinary shares reserved for issuance upon exercise of outstanding warrants or the Class A ordinary shares issuable upon
+conversion of founder shares. Immediately after the consummation of this offering, there will be no preference shares issued and outstanding.
+Founder shares are convertible into Class A ordinary shares initially at a one-for-one ratio but subject to adjustment as set forth herein,
+including in certain circumstances in which we issue Class A ordinary shares or equity-linked securities related to our initial business
+combination.
+
+ 
+
+We
+may issue a substantial number of additional Class A ordinary shares or preference shares to complete our initial business combination
+or under an employee incentive plan after completion of our initial business combination (although our amended and restated memorandum
+and articles of association will provide that we may not issue additional shares that would entitle the holders thereof to receive funds
+from the trust account or vote on any initial business combination or on matters related to our pre-initial business combination activity.
+We may also issue Class A ordinary shares upon conversion of the founder shares at a ratio
+greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our
+amended and restated memorandum and articles of association. However, our amended and restated memorandum and articles of association
+will provide, among other things, that prior to our initial business combination, we may not issue additional shares that would entitle
+the holders thereof to (i) receive funds from the trust account, (ii) vote on any initial business combination or (iii) vote on matters
+related to our pre-initial business combination activity. These provisions of our amended and restated memorandum and articles of association,
+like all provisions of our amended and restated memorandum and articles of association, may be amended with the approval of our shareholders.
+However, our executive officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment
+to our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to provide
+for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if
+we do not complete our initial business combination within 12 months from the closing of this offering (subject to two three-month extensions
+of time, as set forth in this prospectus) or (B) with respect to any other material provisions relating to shareholders rights
+or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary
+shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the
+trust account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
+
+ 
+
+The
+issuance of additional ordinary or preference shares:
+
+ 
+
+ 
+ 
+ 
+ may
+ significantly dilute the equity interest of investors in this offering;
+
+ 
+ 
+ 
+ may
+ subordinate the rights of holders of ordinary shares if preference shares are issued with rights senior to those afforded our ordinary
+ shares;
+
+ 
+ 
+ 
+ could
+ cause a change of control if a substantial number of our ordinary shares are issued, which may affect, among other things, our ability
+ to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and
+ directors; and
+
+ 
+ 
+ 
+ may
+ adversely affect prevailing market prices for our units, Class A ordinary shares and/or warrants.
+
+ 
+ 
+
+ 80
+
+ 
+
+ 
+
+ 
+
+There
+is currently no market for our securities and a market for our securities may not develop, which would adversely affect the liquidity
+and price of our securities.
+
+ 
+
+There
+is currently no market for our securities. Shareholders therefore have no access to information about prior market history on which to
+base their investment decision. Following this offering, the price of our securities may vary significantly due to one or more potential
+business combinations and general market or economic conditions, including as a result of the COVID-19 pandemic. Furthermore, an active
+trading market for our securities may never develop or, if developed, it may not be sustained. You may be unable to sell your securities
+unless a market can be established and sustained.
+
+ 
+
+An
+investment in this offering may result in uncertain or adverse U.S. federal income tax consequences.
+
+ 
+
+An
+investment in this offering may result in uncertain U.S. federal income tax consequences. For instance, it is unclear whether the redemption
+rights with respect to our Class A ordinary shares suspend the running of a U.S. holder s holding period for purposes of determining
+whether any gain or loss realized by such holder on the sale or exchange of Class A ordinary shares is long-term capital gain or loss
+and for determining whether any dividend we pay would be considered "qualified dividend income" for U.S. federal income tax
+purposes. See "United States Federal Income Tax Considerations" below for a
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/TRXA_t-rex_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/TRXA_t-rex_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..b4e42182ec0abc9d419d26adaccde1b00376a8e2
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/TRXA_t-rex_prospectus_summary.txt
@@ -0,0 +1,2003 @@
+PROSPECTUS SUMMARY
+ 
+The following summary highlights selected information contained elsewhere in this prospectus or incorporated by reference into this prospectus from our filings with the Commission listed in the section of the prospectus entitled Incorporation of Certain Information by Reference. Because it is only a summary, it does not contain all of the information that may be important to you and your investment decision. You should read the entire prospectus, the registration statement of which this prospectus is a part, and the information incorporated by reference herein in their entirety, including the Risk Factors section and our financial statements and the related notes incorporated by reference into this prospectus, before making an investment decision. Unless the context requires otherwise, references in this prospectus to the Company, T-Rex, we, us and our refer to T-REX Acquisition Corp., a Nevada corporation, individually, or as the context requires, collectively with its consolidated subsidiaries.
+ 
+T-REX Acquisition Corp.
+ 
+We are an emerging technology company focused on the various verticals with the cryptocurrency industry and related intangible assets that are connected to distributed ledger technologies. Through our operating subsidiary, Raptor Mining, we are engaged in the cryptocurrency mining, which is the process of receiving cryptocurrency rewards for securing particular distributed ledger platforms. Our first cryptocurrency mining operation is located in Tampa, Florida, and the first distributed ledger platform that we are securing is Bitcoin.
+ 
+T-Rex is a holding company with the following subsidiaries: Raptor Mining LLC, a Florida limited liability company ( Raptor Mining ); Megalodon Mining and Electric, LLC a Florida limited liability company( Megalodon ); and TRXA Merger Sub, Inc., an inactive Delaware corporation ( Merger Sub ).
+ 
+Corporate Information
+ 
+The Company was incorporated in Nevada on January 15, 2008 under the name Plethora Resources, Inc. On May 28, 2009, the Company changed its name to Sync2 Networks Corp. after changing its operating business through the acquisition of Sync2 International. On October 9, 2013, the Company filed a Form 14(c) pursuant to which the Company adopted its current name and stock symbol, TRXA , which trades on the OTC Market Group, Inc. Pink tier. After forming our wholly owned subsidiary Raptor Mining in July 9, 2021, we became an operating company.
+ 
+Our principal executive office is located at 7301 NW 4th Street, Plantation, Florida 33322 and our telephone number is (954)742-3001. Our website is https://trex-acq/com. Information contained on our website is not part of this prospectus, and our website address is included in this prospectus as inactive textual references only.
+
+ 
+ 
+8
+
+Table of Contents
+ 
+The Offering
+
+Common Stock Offered by Selling Stockholders:
+This prospectus relates to the possible resale, from time to time, by the selling stockholders identified herein of up to an aggregate of 6,530,267 shares of the Company s common stock, par value $0.001 per share (the Shares ), including (i) an aggregate of 747,837 shares acquired by those selling stockholders who purchased the Company s common stock and warrants pursuant to a Securities Purchase Agreement (defined below) (the PIPE Investors ), (ii) an aggregate of 747,837 shares issuable upon the exercise in full of warrants (the PIPE Warrant Shares ), (iii) an aggregate of 2,437,500 shares of the Company s common stock issuable upon the exercise of warrants held by the remaining Selling Stockholders (the Non-PIPE Warrant Shares ) (assuming the Warrants are exercised in full without regard to any exercise limitations therein), and (iii) 2,597,093 shares of common stock, including common stock owned by the Company s long term investors and beneficially owned by certain directors and current executive officers of the Company.
+
+ 
+The PIPE Warrant Shares and the Non-PIPE Warrant Shares (collectively, the Warrant Shares ) are issuable upon the exercise, as applicable, of the warrants we issued to certain of the selling stockholders in private placements pursuant to the Securities Purchase Agreement. For more information, see The Private Placement Transactions. 
+
+Offering Price:
+The Shares will be offered and sold by the Selling Stockholders at a fixed price of $1.50 per share until our common stock is quoted on OTC Market Group, Inc. s OTCQB or OTCQX tiers, and thereafter the Shares may be sold at prevailing market prices or privately negotiated prices or in transactions that are not in the public market. 
+
+Common Stock Outstanding After the Offering:
+22,759,289 shares(1), which includes 3,185,337 Warrant Shares.
+
+Use of Proceeds:
+We will not receive any proceeds from the sale of Shares by the selling stockholders; however, we will receive the proceeds from any cash exercise of the warrants.
+
+Risk Factors:
+An investment in our securities involves a high degree of risk and could result in a loss of your entire investment. Prior to making an investment decision, you should carefully consider all of the information in this prospectus and, in particular, you should evaluate the risk factors set forth under the caption Risk Factors beginning on page 10.
+
+Market for our Shares:
+Our common stock is quoted on the OTC Markets, Inc. Pink tier under the symbol TRXA. 
+
+ 
+(1)
+The number of common shares to be outstanding immediately after this offering is based on 19,573,952 shares of common stock outstanding as of June 30, 2022 and reflects the number of common shares that will be outstanding assuming that the selling stockholders exercise all of the warrants held by them into 3,185,337 common shares (without regard to any conversion limitations therein).
+
+ 
+ 
+9
+
+Table of Contents
+ 
+RISK FACTORS
+ 
+Investing in our securities involves a high degree of risk. Prior to making a decision about investing in our securities, you should carefully consider the specific risk factors discussed in the sections entitled Risk Factors contained in our Annual Report on Form 10-K for the fiscal year ended June 30, 2021, filed on October 6, 2021 under the heading Item 1A. Risk Factors, and as described or may be described in any subsequent quarterly report on Form 10-Q under the heading Item 1A. Risk Factors, as well as in any applicable prospectus supplement and contained or to be contained in our filings with the Commission and incorporated by reference in this prospectus, together with all of the other information contained in this prospectus, or any applicable prospectus supplement. For a description of these reports and documents, and information about where you can find them, see Where You Can Find More Information and Incorporation of Certain Information by Reference. If any of the risks or uncertainties described in our Commission filings or any prospectus supplement or any additional risks and uncertainties actually occur, our business, financial condition and results of operations could be materially and adversely affected. In that case, the trading price of our securities could decline and you might lose all or part of the value of your investment.
+General Risks
+ 
+We have a history of operating losses, and we may not be able to achieve or sustain profitability; we have recently shifted our focus to our blockchain and cryptocurrency mining business, and we may not be successful in this business.
+ 
+We are not profitable and have incurred losses. We expect to continue to incur losses for the foreseeable future, and these losses could increase as we continue to work to develop our business. Prior to July 2021, we did not have any operations. In July 2021, we determined to pursue a blockchain and cryptocurrency related business. Currently, our primary operations are focused on our cryptocurrency mining business located in Tampa, Florida. Our current strategy is new and unproven, is in an industry that is itself new and evolving, and is subject to the risks discussed below. This strategy, like our prior ones, may not be successful, and we may never become profitable. Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods.
+ 
+If, pursuant to our co-location mining services agreement (the Ace Host Agreement ) with Ace Host ( Ace Host ), Ace Host cannot or will not supply sufficient electric power for us to operate our new miners, we may be required to relocate some or all of our miners to an alternate facility, which may have a less advantageous cost structure and our business and results of operations may suffer as a result.
+ 
+We have made a significant capital investment in new next generation miners because we believe we will be able to operate them to mine Bitcoin and other cryptocurrencies at prices advantageous to us. We believe, based on information presently available to us, that the Ace Host Agreement provides many advantages as opposed to other alternative arrangements. If we are required to deploy or move our miners from Ace Host to another mining facility, we may be forced to accept less advantageous terms. Further, during relocation to a new mining facility, we will not be able to operate our miners and therefore we will not be able to generate revenue.
+ 
+Failure to effectively manage our growth could place strains on our managerial, operational and financial resources and could adversely affect our business and operating results.
+ 
+Our growth has placed, and is expected to continue to place, a strain on our managerial, operational, and financial resources and systems, as well as on our management team. Any further growth or increase in the number of our strategic relationships may place additional strain on our managerial, operational, and financial resources and systems. Although we may not grow as we expect, if we fail to manage our growth effectively or to develop and expand our managerial, operational, and financial resources and systems, our business and financial results would be materially harmed.
+ 
+ 
+10
+
+Table of Contents
+ 
+Significant contributors to the Bitcoin network could propose amendments to its protocols and software which, if accepted and authorized, could negatively impact our business and operations.
+ 
+A small group of individuals contribute to the Bitcoin Core Project on GitHub.com, which is a leading source of quasi-governance that works to ensure that the Bitcoin blockchain remains decentralized and governed by consensus. According to its website, Bitcoin Core is an open source project which maintains and releases Bitcoin client software called Bitcoin Core. It is a direct descendant of the original Bitcoin software client released by Satoshi Nakamoto after he published the famous Bitcoin whitepaper. Bitcoin Core is powered by an open-source development community, but it is maintained by a small group of maintainers and leading contributors.
+ 
+This group of contributors can propose refinements or improvements to the Bitcoin network s source code through one or more software upgrades that alter the protocols and software that govern the Bitcoin network and the properties of Bitcoin, including the irreversibility of transactions and limitations on the mining of new Bitcoin. Proposals for upgrades and discussions relating thereto take place on online forums. 
+ 
+The open-source structure of the Bitcoin network protocol may result in inconsistent and perhaps even ineffective changes to the Bitcoin protocol. Failed upgrades or maintenance to the protocol could damage the Bitcoin network, which could adversely affect our business and the results of our operations.
+ 
+The Bitcoin network operates based on an open-source protocol maintained by contributors, largely on the Bitcoin Core project on GitHub. As an open-source project, Bitcoin is not represented by an official organization or authority. As the Bitcoin network protocol is not sold and its use does not generate revenues for contributors, contributors are generally not compensated for maintaining and updating the Bitcoin network protocol. Although the MIT Media Lab s Digital Currency Initiative funds the current maintainer of the Bitcoin Core project on GitHub, this type of financial incentive is not typical. The lack of guaranteed financial incentive for contributors to maintain or develop the Bitcoin network and the lack of guaranteed resources to adequately address emerging issues with the Bitcoin network may reduce incentives to address the issues adequately or in a timely manner. Changes to a digital asset network which we are mining on may adversely affect an investment in us.
+ 
+If demand for Bitcoin declines, or if another cryptocurrency replaces Bitcoin as the most prominent cryptocurrency, our business and the results of our operations could suffer materially.
+ 
+Although Bitcoin is presently the most prominent cryptocurrency, it is possible that another cryptocurrency could supplant it as the most prominent cryptocurrency, which could have a materially negative effect of the demand for Bitcoin and, therefore, on its conversion spot price. Alternatively, the demand for Bitcoin may fall for other reasons unknown to the Company. Bitcoin represents the Company s largest cryptocurrency asset, so any substantial and sustained reduction in its conversion spot price would negatively impact its value as an asset.
+ 
+ 
+11
+
+Table of Contents
+ 
+Further, the Company has acquired and deployed miners that make use of application-specific integrated circuit (ASIC) chips, which are currently designed only to mine for Bitcoin. If the demand for Bitcoin experiences a sustained and substantial reduction and the conversion spot price of Bitcoin falls correspondingly, we may not be able to continue to mine Bitcoin and we may be forced to reconfigure our existing miners or acquire replacement miners capable of mining other, more profitable cryptocurrencies at that time. We expect to incur significant costs in connection with any such reconfiguration or to acquire replacement miners; further, we will likely be unable to continue to operate our miners during any such reconfiguration or replacement process. These added costs and such an interruption to our business operations could have a material negative effect on our business, and our stock price may suffer.
+ 
+Our ability to adopt technology in response to changing security needs or trends poses a challenge to the safekeeping of our digital assets.
+ 
+The history of digital asset exchanges has shown that exchanges and large holders of digital assets must adapt to technological change in order to secure and safeguard their digital assets. We may move our digital assets to various exchanges to exchange them for fiat currency, which will require us to rely on the security protocols of these exchanges to safeguard our digital assets. While these exchanges purport to be secure, and while we believe them to be so, no security system is perfect and malicious actors may be able to intercept our digital assets while we are in the process of selling them via such exchanges. Given the growth in their size and their relatively unregulated nature, we believe these exchanges will become a more appealing target for malicious actors. To the extent we are unable to identify and mitigate or stop new security threats, our digital assets may be subject to theft, loss, destruction or other attack, which could adversely affect an investment in us.
+ 
+The limited rights of legal recourse available to us and our lack of insurance protection for risk of loss of our digital assets exposes us and our shareholders to the risk of loss of our digital assets for which no person may ultimately be held liable and we may not be able to recover our losses.
+ 
+The digital assets held by us are not insured. Further, banking institutions will not accept our digital assets and they are therefore not insured by the Federal Deposit Insurance Corporation ( FDIC ) or the Securities Investor Protection Corporation ( SIPC ). Therefore, a loss may be suffered with respect to our digital assets which is not covered by insurance and we may not be able to recover any of our carried value in these digital assets if they are lost or stolen or suffer significant and sustained reduction in conversion spot price. If we are not otherwise able to recover damages from a malicious actor in connection with these losses, our business and results of operations may suffer, which may have a material negative impact on our stock price.
+ 
+If regulatory changes or interpretations of our activities require our registration as a money services business ( MSB ) under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, or otherwise under state laws, we may incur significant compliance costs, which could be substantial or cost-prohibitive. If we become subject to these regulations, our costs in complying with them may have a material negative effect on our business and the results of our operations.
+ 
+To the extent that the Company s activities cause it to be deemed an MSB under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, we may be required to comply with FinCEN regulations, including those that would mandate us to implement anti-money laundering programs, make certain reports to FinCEN and maintain certain records.
+ 
+To the extent that the Company s activities cause it to be deemed a money transmitter ( MT ) or equivalent designation, under state law in any state in which the Company operates, the Company may be required to seek a license or otherwise register with a state regulator and comply with state regulations that may include the implementation of anti-money laundering programs, maintenance of certain records and other operational requirements. The Company will continue to monitor for developments in such legislation, guidance or regulations.
+ 
+ 
+12
+
+Table of Contents
+ 
+Such additional federal or state regulatory obligations may cause the Company to incur extraordinary expenses, possibly affecting an investment in the Shares in a material and adverse manner. Furthermore, the Company and its service providers may not be capable of complying with certain federal or state regulatory obligations applicable to MSBs and MTs. If the Company is deemed to be subject to and determines not to comply with such additional regulatory and registration requirements, we may act to dissolve and liquidate the Company or any subsidiary subject to such regulatory requirements. Any such action may adversely affect an investment in us.
+ 
+Current regulation of the exchange of Bitcoin under the CEA by the CFTC is unclear; to the extent we become subject to regulation under the CFTC in connection with our exchange of Bitcoin, we may incur additional compliance costs, which may be significant.
+ 
+Current legislation, including the Commodities Exchange Act of 1936, as amended (the CEA ) is unclear with respect to the exchange of Bitcoin. Changes in the CEA or the regulations promulgated thereunder, as well as interpretations thereof and official promulgations by the Commodities Futures Tradition Commission ( CFTC ), which oversees the CEA much like the SEC oversees the Securities Act and the Exchange Act, may impact the classification of Bitcoin and therefore may subject them to additional regulatory oversight by the CFTC.
+ 
+Presently, Bitcoin derivatives are not excluded from the definition of a commodity future by the CFTC. We cannot be certain as to how future regulatory developments will impact the treatment of Bitcoin under the law. Bitcoins have been deemed to fall within the definition of a commodity and, we may be required to register and comply with additional regulation under the CEA, including additional periodic report and disclosure standards and requirements. Moreover, we may be required to register as a commodity pool operator or as a commodity pool with the CFTC through the National Futures Association. Such additional registrations may result in extraordinary, non-recurring expenses, thereby materially and adversely impacting an investment in us. If we determine not to comply with such additional regulatory and registration requirements, we may seek to cease certain of our operations. Any such action may adversely affect an investment in us. As of the date of this prospectus, no CFTC orders or rulings are applicable to our business.
+ 
+Unfavorable global economic, business or political conditions could adversely affect our business, financial condition or results of operations.
+ 
+Our results of operations could be adversely affected by general conditions in the global economy and in the global financial markets, including conditions that are outside of our control, including the impact of health and safety concerns, such as those relating to the current COVID-19 outbreak. The most recent global financial crisis caused extreme volatility and disruptions in the capital and credit markets. A severe or prolonged economic downturn could result in a variety of risks to our business, including weakened demand for Bitcoin and our ability to raise additional capital when needed on acceptable terms, if at all. Any of the foregoing could harm our business and we cannot anticipate all the ways in which the current economic climate and financial market conditions could adversely impact our business.
+ 
+To date, the COVID-19 outbreak has not had a material adverse impact on our operations. However, the future impact of the COVID-19 or any other pandemic outbreak is highly uncertain, cannot be predicted and there is no assurance that such outbreaks will not have a material adverse impact on the future results of the Company. The extent of the impact, if any, will depend on future developments, including actions taken by federal and state governments.
+ 
+ 
+13
+
+Table of Contents
+ 
+Our future success will depend in large part upon the value of Bitcoin and if we are not able to mine Bitcoin and sell it at prices favorable to us, the results of our operations will suffer.
+ 
+As previously disclosed, our operating results will depend in large part upon the value of Bitcoin because it s the primary cryptocurrency we currently mine. Specifically, our revenues from our Bitcoin mining operations are based upon two factors: (1) the number of Bitcoin rewards we successfully mine and (2) the value of Bitcoin. In addition, our operating results are directly impacted by changes in the value of bitcoin, because under the value measurement model, both realized and unrealized changes will be reflected in our statement of operations (i.e., we will be marking bitcoin to fair value each quarter). This means that our operating results will be subject to swings based upon increases or decreases in the value of bitcoin.
+ 
+Risks Related to an Investment in Our Securities
+ 
+We expect to experience volatility in the price of our common stock, which could negatively affect stockholders investments.
+ 
+The trading price of our common stock may be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control. The stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with securities traded in those markets. Broad market and industry factors may seriously affect the market price of companies stock, including ours, regardless of actual operating performance. All of these factors could adversely affect your ability to sell your shares of common stock or, if you are able to sell your shares, to sell your shares at a price that you determine to be fair or favorable.
+ 
+Our common stock may be categorized as penny stock, which may make it more difficult for investors to sell their shares of common stock due to suitability requirements.
+ 
+Our common stock may be categorized as penny stock. The Commission has adopted Rule 15g-9 under the Exchange Act, which generally defines penny stock to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. The price of our common stock is significantly less than $5.00 per share and, unless we qualify for an exception, may be considered penny stock. This designation imposes additional sales practice requirements on broker-dealers who sell to persons other than established customers and accredited investors. The penny stock rules, if applicable to us, would require a broker-dealer buying our securities to disclose certain information concerning the transaction, obtain a written agreement from the purchaser and determine that the purchaser is reasonably suitable to purchase the securities given the increased risks generally inherent in penny stocks. These rules may restrict the ability and/or willingness of brokers or dealers to buy or sell our common stock, either directly or on behalf of their clients, may discourage potential stockholders from purchasing our common stock, or may adversely affect the ability of stockholders to sell their shares.
+ 
+Financial Industry Regulatory Authority ( FINRA ) sales practice requirements may also limit a stockholder s ability to buy and sell our common stock, which could depress the price of our common stock.
+ 
+FINRA has adopted rules that require a broker-dealer to have reasonable grounds for believing that the investment is suitable for that customer before recommending an investment to a customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer s financial status, tax status, investment objectives, and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. Thus, the FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our shares of common stock, have an adverse effect on the market for our shares of common stock, and thereby depress our price per share of common stock.
+ 
+ 
+14
+
+Table of Contents
+ 
+The elimination of monetary liability against our directors, officers, and employees under Nevada law and the existence of indemnification rights for our obligations to our directors, officers, and employees may result in substantial expenditures by us and may discourage lawsuits against our directors, officers, and employees.
+ 
+Our Articles of Incorporation contain a provision permitting us to eliminate the personal liability of our directors to us and our stockholders for damages for the breach of a fiduciary duty as a director or officer to the extent provided by Nevada law. We may also have contractual indemnification obligations under any future employment agreements with our officers or indemnification agreements we have entered into with our directors. The foregoing indemnification obligations could result in us incurring substantial expenditures to cover the cost of settlement or damage awards against directors and officers, which we may be unable to recoup. These provisions and the resulting costs may also discourage us from bringing a lawsuit against directors and officers for breaches of their fiduciary duties; and may similarly discourage the filing of derivative litigation by our stockholders against our directors and officers even though such actions, if successful, might otherwise benefit us and our stockholders.
+ 
+We may issue additional shares of common stock in the future, which could cause significant dilution to all stockholders.
+ 
+The Board of Directors has resolved to amend the Company s Articles of Incorporation to authorize, among other things, the issuance of up to 350,000,000 shares of common stock, with a par value of $0.001 per share. As of June 30, 2022, we had 19,573,952 shares of common stock outstanding; however, we may issue additional shares of common stock in the future in connection with a financing or an acquisition. Any issuance of additional shares of our common stock, or securities convertible into our common stock, including but not limited to, warrants, options, and convertible promissory notes, will dilute the percentage ownership interest of all stockholders, may dilute the book value per share of our common stock, and may negatively impact the market price of our common stock.
+ 
+Anti-takeover effects of certain provisions of Nevada state law may hinder a potential takeover of us.
+ 
+Nevada has a business combination law that prohibits certain business combinations between Nevada corporations and interested stockholders for two years after an interested stockholder first becomes an interested stockholder, unless the corporation s board of directors approves the combination in advance. For purposes of Nevada law, an interested stockholder is any person who is (i) the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the outstanding voting shares of the corporation or (ii) an affiliate or associate of the corporation and at any time within the two previous years was the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the then outstanding shares of the corporation. The definition of the term business combination is sufficiently broad to cover virtually any kind of transaction that would allow a potential acquirer to use the corporation s assets to finance the acquisition or otherwise to benefit its own interests rather than the interests of the corporation and its other stockholders.
+ 
+ 
+15
+
+Table of Contents
+ 
+The effect of Nevada s business combination law is potentially to discourage parties interested in taking control of us from doing so if they cannot obtain the approval of our Board. Both of these provisions could limit the price investors would be willing to pay in the future for shares of our common stock.
+ 
+Because we do not intend to pay any cash dividends in the foreseeable future on our common stock, our stockholders will not be able to receive a return on their shares unless they sell them.
+ 
+We intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. Declaring and paying future dividends, if any, will be determined by our Board, based upon earnings, financial condition, capital resources, capital requirements, restrictions in our Articles of Incorporation, contractual restrictions, and such other factors as our Board deems relevant. Unless we pay dividends, our stockholders will not be able to receive a return on their shares unless they sell them. There is no assurance that stockholders will be able to sell shares when desired.
+ 
+Failure to execute our strategies could result in impairment of goodwill or other intangible assets, which may negatively impact profitability.
+ 
+We evaluate goodwill for impairment on an annual basis or more frequently if impairment indicators are present based upon the fair value of each reporting unit. We assess the impairment of other intangible assets on an annual basis, or more frequently if impairment indicators are present, based upon the expected future cash flows of the respective assets. These valuations include management s estimates of sales, profitability, cash flow generation, capital structure, cost of debt, interest rates, capital expenditures, and other assumptions. Significant negative industry or economic trends, disruptions to our business, inability to achieve sales projections or cost savings, inability to effectively integrate acquired businesses, unexpected significant changes or planned changes in use of the assets or in entity structure, and divestitures may adversely impact the assumptions used in the valuations. If the estimated fair value of our reporting units changes in future periods, we may be required to record an impairment charge related to goodwill or other intangible assets, which would reduce earnings in such period.
+ 
+ 
+16
+
+Table of Contents
+ 
+USE OF PROCEEDS
+ 
+The selling stockholders will receive all of the proceeds from the sale of Shares offered by them pursuant to this prospectus. We will not receive any proceeds from the sale of the Shares by the selling stockholders. If any of the Warrants are exercised for cash, we intend to use the proceeds for general working capital purposes.
+ 
+ 
+17
+
+Table of Contents
+ 
+THE PRIVATE PLACEMENT TRANSACTIONS
+ 
+The Securities Purchase Agreements 
+ 
+On November 10, 2021, we entered into a Securities Purchase Agreement with certain of the selling stockholders pursuant to which we sold to such selling stockholders $560,875 in aggregate principal amount of our common stock (which we refer to as the Shares ) and warrants to purchase shares of our common stock (which we refer to as the PIPE Warrants ), exercisable at any time before the close of business on December 31, 2024. The PIPE Warrants are comprised of 747,837 warrants with an exercise price of $1.50 per share. 
+ 
+We closed the transactions contemplated by the Securities Purchase Agreement. We issued the securities contemplated under the Securities Purchase Agreement in reliance upon the exemption from registration pursuant to Section 4(a)(2) of the Securities Act.
+ 
+The Registration Rights Agreements
+ 
+On November 10, 2021, in connection with the closing of the transactions contemplated by the Securities Purchase Agreement, we entered into substantially similar Registration Rights Agreements the selling stockholders who are parties to the Securities Purchase Agreement. With respect to the selling stockholders who are party to the Securities Purchase Agreement, we are obligated to file a registration statement registering the resale of (i) their Warrant Shares, (ii) any Shares issuable under the terms of the Securities Purchase Agreement, and (iii) any securities issued or then issuable upon any stock split, dividend or other distribution, recapitalization, or similar event with respect to the foregoing.
+ 
+Pursuant to the Registration Rights Agreements, we agreed to file the registration statement(s) no later than the earlier of (a) 180-days after an initial public offering by the Company or (b) twelve (12) months after effective date of the Registration Rights Agreement. Furthermore, we agreed to grant the parties to the Securities Purchase Agreement a piggy-back registration right upon at least 10-day notice prior to the Company s filing of a registration statement (or confidential submission in draft form) with the SEC.
+ 
+Warrants Issued to Management and Consultants
+ 
+On May 26, 2022, the Company issued to Frank Horkey Class C warrant to purchase 250,000 shares of the Company s common stock for a period of three years at an exercise price of $1.50 commencing upon the effective date of the Company s registration statement as part of his executive compensation during the 2021 fiscal year.
+ 
+On May 26, 2022, the Company issued to both Peter S. Chung and Timothy B Ruggiero Class C warrants for each to purchase 500,000 shares of the company s common stock for a period of three years at an exercise price of $1.50 commencing upon the effective date of the Company s registration statement related to consulting services during the 2021 fiscal year
+ 
+On June 25, 2022, Frank Horkey and Michael Christiansen were each issued 250,000 class C warrants to purchase 250,000 shares of the company s common stock for a period of three years at an exercise price of $1.50 commencing upon the effective date of the Company s registration statement for serving on the Company s Board of Directors for the upcoming 2022 fiscal year. 
+ 
+On June 25, 2022, Peter S Chung and Timothy B Ruggiero were each issued a class C warrant to purchase 250,000 shares of the company s common stock for a period of three years at an exercise price of $1.50 commencing upon the effective date of the Company s registration statement for serving on the Company s Advisory Board for the upcoming 2022 fiscal year.
+ 
+ 
+18
+
+Table of Contents
+ 
+Common Shares Issued to Members of the Board of Directors
+ 
+On July 1, 2022, the Board of Directors of the Company reappointed Frank Horkey and appointed Michael Christiansen to our Board of Directors. In connection with their respective appointments, we entered into agreements with Frank Horkey and Michael Christiansen pursuant to which, among other things, the Company issued in a private placement 250,000 restricted shares of the Company s common stock to each director, subject to a vesting schedule. 
+ 
+We issued the shares described above to Frank Horkey and Michael Christiansen in reliance upon the exemption from registration contained in Section 4(a)(2) of the Securities Act.
+ 
+For more information about the selling stockholders, see Selling Stockholders. 
+ 
+ 
+19
+
+Table of Contents
+ 
+SELLING STOCKHOLDERS
+ 
+The prospectus relates to the possible resale, from time to time, by the selling stockholders identified herein of up to 6,530,267 Shares, including (i) 5,034,593 common shares beneficially owned by long term shareholders of the Company s common stock, which include 1,450,000 shares of common stock beneficially owned by certain of our directors and current executive officers, (ii) 747,837 shares issued to the PIPE Investors, and (iii) 747,837 shares of common stock issuable upon the exercise in full of warrants held by the PIPE Investors (without regard to any conversion limitations therein).
+ 
+When we refer to the selling stockholders in this prospectus, we mean the entities or persons listed in the table below, and their respective pledgees, donees, permitted transferees, assignees, successors and others who later come to hold any of the selling stockholders interests in shares of our common stock other than through a public sale.
+ 
+We will not receive any proceeds from the sale of the Shares offered by the selling stockholders; however, we will receive the proceeds from any cash exercise of the warrants.
+ 
+We are unable to determine the exact number of Shares that will actually be sold by the selling stockholders according to this prospectus due to:
+ 
+ 
+ 
+the uncertainty as to the number of warrant shares that will ultimately be issued to the selling stockholders upon the exercise of the warrants; and
+
+ 
+ 
+ 
+
+ 
+ 
+the ability of the selling stockholders to determine when and whether they will sell any of the warrant shares they receive upon exercise, as applicable, under this prospectus.
+
+ 
+The Shares covered by this prospectus are being registered to permit public sales of such securities, and the selling stockholders may offer the Shares for resale from time to time pursuant to this prospectus. The selling stockholders may also sell, transfer or otherwise dispose of all or a portion of their Shares in transactions exempt from the registration requirements of the Securities Act or pursuant to another effective registration statement covering the sale of such securities. We are relying on an exemption from the registration requirements of the Securities Act for the private placement of our securities upon the exercise of the Warrants, pursuant to Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D promulgated thereunder.
+ 
+ 
+20
+
+Table of Contents
+ 
+The following table sets forth, based on information provided to us by the selling stockholders or known to us, the names of the selling stockholders, the nature of any position, office or other material relationship, if any, which the selling stockholders have had, within the past three years, with us or with any of our predecessors or affiliates, and the number of shares of our common stock beneficially owned by the selling stockholders before and after this offering. The number of shares owned are those beneficially owned, as determined under the rules of the Commission, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under these rules, beneficial ownership includes any shares of common stock as to which a person has sole or shared voting power or investment power and any shares of common stock that the person has the right to acquire within 60 days of June 30, 2022 through vesting, the exercise of any option, warrant or right, through conversion of any security or pursuant to the automatic termination of a power of attorney or revocation of a trust, discretionary account or similar arrangement. Except as otherwise set forth herein, none of the selling stockholders are a broker-dealer or an affiliate of a broker- dealer.
+ 
+Name of Selling Shareholder
+ 
+Shares Beneficially 
+Owned Prior to 
+Offering(1)
+ 
+ 
+Shares of 
+Common Stock 
+being Offered
+ 
+ 
+Number of Shares to be 
+Beneficially Owned by 
+Selling Shareholders 
+after the Offering(2)
+ 
+ 
+Percent of 
+Total Issued & 
+Outstanding 
+Shares(3)
+ 
+
+Frank Horkey(4)
+ 
+ 
+1,450,000 
+ 
+ 
+552,000 
+ 
+ 
+898,000 
+ 
+ 
+3.95%
+Peter Chung
+ 
+ 
+1,260,362 
+ 
+ 
+826,554 
+ 
+ 
+433,808 
+ 
+ 
+1.91%
+Timothy B Ruggiero Profit Sharing Plan
+ 
+ 
+1,141,109 
+ 
+ 
+769,078 
+ 
+ 
+372,031 
+ 
+ 
+1.63%
+Michael Christiansen(5)
+ 
+ 
+500,000 
+ 
+ 
+162,500 
+ 
+ 
+337,500 
+ 
+ 
+1.48%
+Squadron Marketing LLC(6)
+ 
+ 
+1,075,100 
+ 
+ 
+161,265 
+ 
+ 
+913,835 
+ 
+ 
+4.02%
+Lazarus Asset Management LLC(7)
+ 
+ 
+986,328 
+ 
+ 
+147,949 
+ 
+ 
+838,379 
+ 
+ 
+3.68%
+Paul Lajoie / Legacy Relations, LP
+ 
+ 
+266,668 
+ 
+ 
+266,668 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Braden James
+ 
+ 
+266,668 
+ 
+ 
+266,668 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Joseph Womack
+ 
+ 
+266,668 
+ 
+ 
+266,668 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Kevin Gray / Gray Family Concepts, LLC
+ 
+ 
+266,668 
+ 
+ 
+266,668 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Lawrence Moskowitz
+ 
+ 
+533,334 
+ 
+ 
+193,334 
+ 
+ 
+340,000 
+ 
+ 
+1.49%
+Leanne Gonzalez
+ 
+ 
+700,000 
+ 
+ 
+105,000 
+ 
+ 
+595,000 
+ 
+ 
+2.61%
+Cat's Tales Productions LLC
+ 
+ 
+690,000 
+ 
+ 
+103,500 
+ 
+ 
+586,500 
+ 
+ 
+2.58%
+Timothy B Ruggiero, Jr.
+ 
+ 
+675,000 
+ 
+ 
+101,250 
+ 
+ 
+573,750 
+ 
+ 
+2.52%
+Thomas Stephens
+ 
+ 
+685,000 
+ 
+ 
+128,250 
+ 
+ 
+556,750 
+ 
+ 
+2.45%
+Vivia Joy Chin
+ 
+ 
+637,875 
+ 
+ 
+95,681 
+ 
+ 
+542,194 
+ 
+ 
+2.38%
+Alan Morgillo
+ 
+ 
+618,000 
+ 
+ 
+105,450 
+ 
+ 
+512,550 
+ 
+ 
+2.25%
+Andrew R. McKillop, Sr. TR
+ 
+ 
+596,907 
+ 
+ 
+89,536 
+ 
+ 
+507,371 
+ 
+ 
+2.23%
+Mitch Leitner
+ 
+ 
+575,000 
+ 
+ 
+86,250 
+ 
+ 
+488,750 
+ 
+ 
+2.15%
+Robb Titone
+ 
+ 
+575,000 
+ 
+ 
+86,250 
+ 
+ 
+488,750 
+ 
+ 
+2.15%
+Yvonne Chung
+ 
+ 
+540,000 
+ 
+ 
+81,000 
+ 
+ 
+459,000 
+ 
+ 
+2.02%
+Andrew Stern
+ 
+ 
+500,000 
+ 
+ 
+75,000 
+ 
+ 
+425,000 
+ 
+ 
+1.87%
+Ellis Kahn
+ 
+ 
+500,000 
+ 
+ 
+75,000 
+ 
+ 
+425,000 
+ 
+ 
+1.87%
+J. Ronald Hankins
+ 
+ 
+500,000 
+ 
+ 
+85,000 
+ 
+ 
+415,000 
+ 
+ 
+1.82%
+Ricardo Plummer
+ 
+ 
+500,000 
+ 
+ 
+75,000 
+ 
+ 
+425,000 
+ 
+ 
+1.87%
+Sheila Hoenermann EX
+ 
+ 
+500,000 
+ 
+ 
+75,000 
+ 
+ 
+425,000 
+ 
+ 
+1.87%
+Thomas Manz
+ 
+ 
+500,000 
+ 
+ 
+75,000 
+ 
+ 
+425,000 
+ 
+ 
+1.87%
+Sparta Road Ltd.
+ 
+ 
+495,220 
+ 
+ 
+74,283 
+ 
+ 
+420,937 
+ 
+ 
+1.85%
+Evoke Holdings LLC
+ 
+ 
+133,334 
+ 
+ 
+133,334 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Crestline Consulting Group LLC
+ 
+ 
+133,334 
+ 
+ 
+133,334 
+ 
+ 
+0 
+ 
+ 
+0.00%
+John Bennett
+ 
+ 
+100,000 
+ 
+ 
+15,000 
+ 
+ 
+85,000 
+ 
+ 
+0.37%
+New Hudson Properties LLC
+ 
+ 
+405,370 
+ 
+ 
+60,806 
+ 
+ 
+344,565 
+ 
+ 
+1.51%
+Adam Brosius
+ 
+ 
+400,000 
+ 
+ 
+60,000 
+ 
+ 
+340,000 
+ 
+ 
+1.49%
+Squadron Marketing
+ 
+ 
+274,379 
+ 
+ 
+41,157 
+ 
+ 
+233,222 
+ 
+ 
+1.02%
+John Garrell
+ 
+ 
+202,500 
+ 
+ 
+42,700 
+ 
+ 
+159,800 
+ 
+ 
+0.70%
+Philip Dean
+ 
+ 
+266,666 
+ 
+ 
+40,000 
+ 
+ 
+226,666 
+ 
+ 
+1.00%
+James Stephenson Burrell, II
+ 
+ 
+250,000 
+ 
+ 
+37,500 
+ 
+ 
+212,500 
+ 
+ 
+0.93%
+Ronald Suster
+ 
+ 
+235,076 
+ 
+ 
+35,261 
+ 
+ 
+199,815 
+ 
+ 
+0.88%
+William Malenbaum
+ 
+ 
+220,000 
+ 
+ 
+33,000 
+ 
+ 
+187,000 
+ 
+ 
+0.82%
+ 
+ 
+21
+
+Table of Contents
+ 
+Allison Lee Chung
+ 
+ 
+200,000 
+ 
+ 
+30,000 
+ 
+ 
+170,000 
+ 
+ 
+0.75%
+Stress Free Capital Inc.
+ 
+ 
+200,000 
+ 
+ 
+30,000 
+ 
+ 
+170,000 
+ 
+ 
+0.75%
+Corporate Capital Group Int'l, Ltd.
+ 
+ 
+200,000 
+ 
+ 
+30,000 
+ 
+ 
+170,000 
+ 
+ 
+0.75%
+Marcela Vargas
+ 
+ 
+190,000 
+ 
+ 
+28,500 
+ 
+ 
+161,500 
+ 
+ 
+0.71%
+Tina Louise Chung
+ 
+ 
+166,900 
+ 
+ 
+25,035 
+ 
+ 
+141,865 
+ 
+ 
+0.62%
+Steven Brandenberg
+ 
+ 
+150,000 
+ 
+ 
+21,000 
+ 
+ 
+129,000 
+ 
+ 
+0.57%
+David Biasetti
+ 
+ 
+100,000 
+ 
+ 
+15,000 
+ 
+ 
+85,000 
+ 
+ 
+0.37%
+Frank Essner
+ 
+ 
+100,000 
+ 
+ 
+15,000 
+ 
+ 
+85,000 
+ 
+ 
+0.37%
+Tonia Pfannestiel
+ 
+ 
+100,000 
+ 
+ 
+15,000 
+ 
+ 
+85,000 
+ 
+ 
+0.37%
+Frank Grenier
+ 
+ 
+90,000 
+ 
+ 
+13,500 
+ 
+ 
+76,500 
+ 
+ 
+0.34%
+James Marshall
+ 
+ 
+75,000 
+ 
+ 
+11,250 
+ 
+ 
+63,750 
+ 
+ 
+0.28%
+James Marshal III
+ 
+ 
+75,000 
+ 
+ 
+11,250 
+ 
+ 
+63,750 
+ 
+ 
+0.28%
+Anthony Abbruzzese
+ 
+ 
+250,000 
+ 
+ 
+196,875 
+ 
+ 
+53,125 
+ 
+ 
+0.23%
+Leanne Kennedy
+ 
+ 
+50,000 
+ 
+ 
+7,500 
+ 
+ 
+42,500 
+ 
+ 
+0.19%
+Lenny S. Morales
+ 
+ 
+50,000 
+ 
+ 
+7,500 
+ 
+ 
+42,500 
+ 
+ 
+0.19%
+Jospeph Pizzolato
+ 
+ 
+50,000 
+ 
+ 
+7,500 
+ 
+ 
+42,500 
+ 
+ 
+0.19%
+Dean Julia
+ 
+ 
+31,875 
+ 
+ 
+4,781 
+ 
+ 
+27,094 
+ 
+ 
+0.12%
+Michael Trepita
+ 
+ 
+31,875 
+ 
+ 
+4,781 
+ 
+ 
+27,094 
+ 
+ 
+0.12%
+John Christopher Stickle 
+ 
+ 
+26,000 
+ 
+ 
+3,900 
+ 
+ 
+22,100 
+ 
+ 
+0.10%
+Jeanne Irvine
+ 
+ 
+25,000 
+ 
+ 
+3,750 
+ 
+ 
+21,250 
+ 
+ 
+0.09%
+Andrea Acuna
+ 
+ 
+25,000 
+ 
+ 
+3,750 
+ 
+ 
+21,250 
+ 
+ 
+0.09%
+Scott Lucas
+ 
+ 
+30,000 
+ 
+ 
+4,500 
+ 
+ 
+25,500 
+ 
+ 
+0.11%
+Warren Diener
+ 
+ 
+20,000 
+ 
+ 
+3,000 
+ 
+ 
+17,000 
+ 
+ 
+0.07%
+Andrew Stowe
+ 
+ 
+10,000 
+ 
+ 
+1,500 
+ 
+ 
+8,500 
+ 
+ 
+0.04%
+Craig Ahlstrom and Lori Ahslstrom JTWROS
+ 
+ 
+10,000 
+ 
+ 
+1,500 
+ 
+ 
+8,500 
+ 
+ 
+0.04%
+Katherine Wilson
+ 
+ 
+10,000 
+ 
+ 
+1,500 
+ 
+ 
+8,500 
+ 
+ 
+0.04%
+Maria Diaz
+ 
+ 
+10,000 
+ 
+ 
+1,500 
+ 
+ 
+8,500 
+ 
+ 
+0.04%
+Alan J Morgillo
+ 
+ 
+200 
+ 
+ 
+200 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Susan Morgillo
+ 
+ 
+200 
+ 
+ 
+200 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Robert E. Wood Jr
+ 
+ 
+200 
+ 
+ 
+200 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Rosemarie Manchio
+ 
+ 
+200 
+ 
+ 
+200 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Joseph O Morgillo
+ 
+ 
+200 
+ 
+ 
+200 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Debbie McKillop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Drew McKillop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+William McKIllop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Michelle McKillop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Theresa McKillop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Isabel McKIllop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Matthew McKillop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Charles Murray
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Ruth Van Tilborg
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Betty McKillop
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Lydia Barrow Hankins
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Micah Ronald Hankins
+ 
+ 
+200 
+ 
+ 
+200 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Samuel Drake Hankins
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+ 
+ 
+22
+
+Table of Contents
+ 
+Heather Lyn Hankins
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Luke Barrow Hankins
+ 
+ 
+200 
+ 
+ 
+200 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Shelby Marie Hummel
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Joshua Michael Smith
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+Aksia Ruth McKenzie
+ 
+ 
+100 
+ 
+ 
+100 
+ 
+ 
+0 
+ 
+ 
+0.00%
+ 
+(1)
+Beneficial ownership is determined in accordance with Commission rules and generally includes voting or investment power with respect to shares of common stock. Shares of common stock subject to vesting within 60 days of June 30, 2022, options and warrants currently exercisable, or exercisable within 60 days of June 30, 2022 are counted as outstanding for computing the percentage of the person holding such shares, options, warrants or notes, but are not counted as outstanding for computing the percentage of any other person.
+
+ 
+ 
+
+(2)
+Assumes the sale of all Shares registered pursuant to this prospectus by the selling stockholder, although none of the selling stockholders is under any obligation known to us to sell any Shares at this time.
+
+ 
+ 
+
+(3)
+Based on 22,759,289 shares of the Company s common stock consisting of the sum of (a) 19,573,952 shares issued and outstanding as of June 30, 2022 and (b) 3,185,337 shares that will be issued upon the Selling Stockholders exercise of all of their warrants.
+
+ 
+ 
+
+(4)
+Mr. Horkey serves as the Company s CEO and President, and, as of the date of this filing, Mr. Horkey serves as the Company s Chairman of the Board of Directors.
+
+ 
+ 
+
+(5)
+Mr. Christiansen was elected to the Company s board of directors and Mr. Christiansen s term began on July 1, 2022.
+
+ 
+ 
+
+(6)
+As of the date of this filing, Squadron Marketing LLC 's percentage ownership of the Company s common stock is 5.49%.
+
+ 
+ 
+
+(7)
+As of the date of this filing, Lazarus Asset Management LLC s percentage ownership of the Company s common stock is 5.04%.
+
+ 
+ 
+23
+
+Table of Contents
+ 
+PLAN OF DISTRIBUTION
+ 
+The Shares will be offered and sold by the Selling Stockholders at a fixed price of $1.50 per share until our common stock is quoted on OTC Market Group, Inc. s OTCQB or OTCQX tiers, and thereafter the Shares may be sold at prevailing market prices or privately negotiated prices or in transactions that are not in the public market. The Selling Stockholders may, from time to time, sell, transfer, or otherwise dispose of any or all of the Shares covered by this prospectus on any stock exchange, market, or trading facility on which our common stock is traded, or in private transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale or at negotiated prices. The Selling Stockholders may use any one or more of the following methods when disposing of Shares:
+ 
+ 
+ 
+disposition on any national securities exchange on which our common stock may be listed at the time of the sale;
+ 
+ 
+ 
+
+ 
+ 
+disposition in the over-the-counter markets;
+ 
+ 
+ 
+
+ 
+ 
+ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
+ 
+ 
+ 
+
+ 
+ 
+block trades in which the broker-dealer will attempt to sell the Shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction;
+ 
+ 
+ 
+
+ 
+ 
+purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
+ 
+ 
+ 
+
+ 
+ 
+an exchange distribution in accordance with the rules of the applicable exchange;
+ 
+ 
+ 
+
+ 
+ 
+privately negotiated transactions;
+ 
+ 
+ 
+
+ 
+ 
+short sales;
+ 
+ 
+ 
+
+ 
+ 
+writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
+ 
+ 
+ 
+
+ 
+ 
+disposition in one or more underwritten offerings in a best efforts basis or firm commitment basis;
+ 
+ 
+ 
+
+ 
+ 
+broker-dealers may agree with the Selling Stockholders to sell a specified number of such Shares at a stipulated price per share;
+ 
+ 
+ 
+
+ 
+ 
+a combination of any such methods of sale; or
+ 
+ 
+ 
+
+ 
+ 
+any other method permitted by applicable law.
+ 
+We do not know of specific arrangements by the Selling Stockholders for the sale of their Shares. The aggregate proceeds to the Selling Stockholders from any sale of the Shares offered by them will be the purchase price of the Shares less discounts or commissions, if any. The Selling Stockholders reserve the right to accept and, together with their respective agents from time to time, to reject, in whole or in part, any proposed purchase of Shares to be made directly or through agents. We will not receive any of the proceeds from any such sale; however, we will receive the proceeds from any cash exercise of Warrants.
+ 
+The Selling Stockholders also may resell all or a portion of the Shares in reliance upon Rule 144 promulgated under the Securities Act or any other exemption from registration under the Securities Act, provided that they meet the criteria and conform to the requirements of any such rule.
+ 
+The Selling Stockholders and any broker-dealers or agents that participate in the sale of the Shares may be deemed to be underwriters within the meaning of Section 2(a)(11) of the Securities Act. Any discounts, commissions, concessions or profit they earn on any resale of the Shares may be underwriting discounts and commissions under the Securities Act. The Selling Stockholders are subject to the prospectus delivery requirements of the Securities Act.
+ 
+The Selling Stockholders will bear all commissions and discounts, if any, attributable to the sale or disposition of the Shares, or interests therein. We will bear all costs, expenses, and fees in connection with the registration of the Shares. We will not be paying any underwriting discounts or commissions in this offering.
+ 
+ 
+24
+
+Table of Contents
+ 
+DESCRIPTION OF SECURITIES
+ 
+The following is a summary of all material characteristics of our capital stock as set forth in our Articles of Incorporation, as amended (the Articles of Incorporation ), and our Bylaws (the Bylaws ), which are filed as exhibits to the registration statement of which this prospectus is a part. The summary does not purport to be complete and is qualified in its entirety by reference to our Articles of Incorporation and our Bylaws, and to the provisions of Chapter 78 of the Nevada Revised Statutes (the NRS ). We encourage you to review complete copies of our Articles of Incorporation and our Bylaws. You can obtain copies of these documents by following the directions outlined in Where You Can Find Additional Information and Incorporation of Certain Information by Reference elsewhere in this prospectus.
+ 
+Common Stock
+ 
+As of the date of this filing, the Company is authorized to issue up to 350,000,000 shares of our common stock, par value of $0.001 per share. As of June 30, 2022, there were 19,573,952 shares of common stock issued and outstanding, 3,185,337 shares of common stock issuable upon the exercise of all our outstanding warrants.
+ 
+Voting Rights
+ 
+Holders of our common shares are entitled to one vote per share on all matters requiring a vote of the stockholders, including the election of directors.
+ 
+Holders of our common shares do not have cumulative voting rights.
+ 
+Liquidation
+ 
+In the event of a liquidation, dissolution, or winding up of the Company, the holders of our common shares are entitled to share pro-rata all assets remaining after payment in full of all liabilities, subject to prior distribution rights of preferred stock, if any, then-outstanding.
+ 
+Dividend Rights
+ 
+Holders of our common shares are entitled to share ratably in dividends, if any, as may be declared from time to time by our Board in its discretion from funds legally available therefore, subject to preferences that may be applicable to our preferred stock, if any, then-outstanding. Dividends, if any, will be contingent upon our revenues and earnings, if any, capital requirements, and financial conditions. We intend to retain earnings, if any, for use in our business operations and accordingly, our Board does not anticipate declaring any dividends in the foreseeable future.
+ 
+Other Rights and Restrictions
+ 
+Our common shares have no preemptive or conversion rights or other subscription rights. There are no redemption or sinking fund provisions applicable to our common shares.
+ 
+Transfer Agent and Registrar
+ 
+The transfer agent for our common stock is Equiniti Trust Company( EQ ) at 275 Madison Avenue, 34th Floor, New York, New York 10016. EQ can be contacted at (720) 355-1661.
+ 
+Listing
+ 
+Our common stock is quoted on the OTC Markets Group, Inc. s Pink tier under the symbol TRXA. 
+ 
+ 
+25
+
+Table of Contents
+ 
+Penny Stock Regulations
+ 
+The Commission has adopted regulations that generally define penny stock to be an equity security that has a market price of less than $5.00 per share. Our common stock may fall within the definition of penny stock and be subject to rules that impose additional sales practice requirements on broker-dealers who sell such securities to persons other than established customers and accredited investors (as defined under the Securities Act).
+ 
+For transactions covered by these rules, the broker-dealer must make a special suitability determination for the purchase of such securities and have received the purchaser s prior written consent to the transaction. Additionally, for any transaction, other than exempt transactions, involving a penny stock, the rules require the delivery, prior to the transaction, of a risk disclosure document mandated by the Commission relating to the penny stock market. The broker- dealer also must disclose the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and, if the broker-dealer is the sole market-maker, the broker-dealer must disclose this fact and the broker-dealer s presumed control over the market. Finally, monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.
+ 
+Consequently, the penny stock rules, if applicable to the Company, may restrict the ability of broker-dealers to sell our common stock and may affect the ability of investors to sell their common stock in the secondary market.
+ 
+Anti-Takeover Provisions
+ 
+Certain provisions of Nevada law and our Articles of Incorporation and Bylaws could make more difficult the acquisition of us by means of a tender offer or otherwise, and the removal of incumbent officers and directors. These provisions are expected to discourage certain types of coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of us.
+ 
+Nevada Law
+ 
+Business Combinations. The business combination provisions of Sections 78.411 to 78.444, inclusive, of the NRS prohibit a Nevada corporation with at least 200 stockholders (at least 100 of whom are stockholders of record and residents of the State of Nevada) from engaging in various combination transactions with any interested stockholder for a period of two years after the date of the transaction in which the person became an interested stockholder, unless the transaction is approved by the board of directors prior to the date the interested stockholder obtained such status; or after the expiration of the two-year period, unless:
+ 
+The combination or the transaction by which the person first became an interested stockholder is approved by the board of directors of the corporation before the person first became an interested stockholder, or
+ 
+The combination is approved by the board of directors of the corporation and, at or after that time, the combination is approved at an annual or special meeting of the stockholders of the corporation, and not by written consent, by the affirmative vote of the holders of stock representing at least 60 percent of the outstanding voting power of the corporation not beneficially owned by the interested stockholder or the affiliates or associates of the interested stockholder.
+ 
+In general, an interested stockholder is a person who, together with affiliates and associates, owns (or within three years, did own) ten percent (10%) or more of a corporation s voting stock. The statute could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us even though such a transaction may offer our stockholders the opportunity to sell their stock at a price above the prevailing market price. A combination is generally defined to include mergers or consolidations or any sale, lease exchange, mortgage, pledge, transfer, or other disposition, in one transaction or a series of transactions, with an interested stockholder having: (a) an aggregate market value equal to five percent (5%) or more of the aggregate market value of the assets of the corporation, (b) an aggregate market value equal to five percent (5%) or more of the aggregate market value of all outstanding shares of the corporation, or (c) ten percent (10%) or more of the earning power or net income of the corporation
+ 
+The business combination statute could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire the Company even though such a transaction may offer the Company s stockholders the opportunity to sell their stock at a price above the prevailing market price.
+ 
+ 
+26
+
+Table of Contents
+ 
+SECURITY OWNERSHIP OF CERTAIN BENEFICAL OWNERS AND MANAGEMENT
+ 
+The following table sets forth certain information as of June 30, 2021, with respect to the holdings of our common stock by: (1) each person known to us to be the beneficial owner of more than 5% of our common stock; (2) each of our directors and 2021 fiscal year named executive officers; and (3) all directors and executive officers as a group. To the best of our knowledge, each of the persons named in the table below as beneficially owning the shares set forth therein has sole voting power and sole investment power with respect to such shares, unless otherwise indicated. Unless otherwise specified, the address of each of the persons set forth below is in care of the Company, at the address of 7301 NW 4th Street Suite 102 Plantation Florida, 33317.
+ 
+In computing the number and percentage of shares beneficially owned by each person, we include any shares of common stock that could be acquired within 60 days of June 30, 2021, upon the vesting of share awards and the exercise of option awards or warrants. These shares, however, are not counted in computing the percentage ownership of any other person.
+ 
+On September 9, 2020, Frank Horkey Pres/CEO, Secretary CFO and sole director was issued 350,000 shares of the Company s common stock pursuant to a certain Management Agreement dated January 1, 2015. Mr. Horkey has no options to purchase any stock.
+ 
+The following table sets forth certain information regarding the beneficial ownership of our common stock as of June 30, 2021 by each person or entity known by us to be the beneficial owner of more than 5% of the outstanding shares of common stock, each of our directors and named executive officers, and all of our directors and executive officers as a group.
+ 
+Title of Class
+ 
+Name and Address of Beneficial Owner
+ 
+Amount and Nature of Beneficial Owner
+ 
+Percent of
+Class (1)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Officers and Directors
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Common Stock
+ 
+Frank Horkey
+7301 NW 4th St Suite 102
+Plantation, Florida 33317
+ 
+350,000 shares
+ 
+ 
+2.2%
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Common Stock
+ 
+All directors and named executive officers as a group (1 person)
+ 
+350,000 shares
+ 
+ 
+2.2%
+Beneficial Owners 5% or Greater
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+Squadron Marketing LLC.
+ 
+1,455,220 shares
+ 
+ 
+9%
+ 
+ 
+2070 South Hibiscus Rd
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+North Miami, FL 33181
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+Lazarus Asset Management, LLC
+ 
+1,455,220 shares
+ 
+ 
+9%
+ 
+ 
+9540 NW 10th St
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+Plantation, FL 33317 
+ 
+ 
+ 
+ 
+ 
+ 
+
+______________
+(1)
+Percentage of beneficial ownership of our common stock is based on 16,169,106 shares of common stock outstanding as of the date of the Company s most recently filed annual report for the fiscal year ending June 30, 2021.
+
+ 
+ 
+27
+
+Table of Contents
+ 
+LEGAL MATTERS
+ 
+Unless otherwise indicated, Shawn R. Perez, Esq., will pass upon the validity of the shares of our common stock to be sold in this offering.
+ 
+EXPERTS
+ 
+Fruci Associates II, PLLC, an independent registered public accounting firm, has audited our consolidated financial statements at June 30, 2021 and 2020 as set forth in its report included in our annual report on Form 10-K for the year ended June 30, 2021, which is incorporated by reference into this prospectus and elsewhere in the registration statement of which this prospectus is a part. Our consolidated financial statements are incorporated by reference in reliance on Fruci Associates II, PLLC s reports, given on their authority as experts in accounting and auditing.
+ 
+DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
+ 
+Our Articles of Incorporation and Bylaws provide that we may indemnify our officers and directors to the maximum extent permitted by Nevada law, and we have entered into agreements with our directors to provide contractual indemnification in addition to the indemnification provided in our Bylaws. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling the registrant pursuant to the foregoing provisions, the registrant has been informed that in the opinion of the Commission such indemnification is against public policy as expressed in the Act and is therefore unenforceable.
+ 
+ 
+28
+
+Table of Contents
+ 
+
+ 
+T-REX ACQUISITION CORP.
+ 
+6,530,267 Shares of Common Stock
+ 
+SEPTEMBER __, 2022
+ 
+PROSPECTUS
+ 
+ 
+ 
+
+Table of Contents
+ 
+INFORMATION NOT REQUIRED TO BE INCLUDED IN THE PROSPECTUS
+ 
+Item 13. Other Expenses of Issuance and Distribution.
+ 
+The following table sets forth the costs and expenses payable by the Registrant in connection with the issuance and distribution of the securities being registered hereunder. All amounts are estimates except the SEC registration fee.
+ 
+SEC registration fess 
+ 
+$908.03
+ 
+
+Printing expenses
+ 
+$0.00 
+
+Accounting fees and expenses
+ 
+$1,575.00 
+
+Legal fees and expenses
+ 
+$15,000.00 
+
+Miscellaneous
+ 
+$2,200.00 
+
+Total
+ 
+$19,683.03
+ 
+
+ 
+Item 14. Indemnification of Directors and Officers.
+ 
+The Registrant is incorporated under the laws of the State of Nevada. Chapter 78 of the Nevada Revised Statutes (the NRS ) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding whether civil, criminal, administrative, or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is or was a director, officer, employee, or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he is not liable pursuant to NRS Section 78.138 or acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.
+ 
+NRS Chapter 78 further provides that a corporation similarly may indemnify any such person serving in any such capacity who was or is a party or is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee, or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys fees) actually and reasonably incurred in connection with the defense or settlement of such action or suit if he is not liable pursuant to NRS Section 78.138 or acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue, or matter as to which such person shall have been adjudged, after exhaustion of all appeals, to be liable to the corporation unless and only to the extent that the court or other court of competent jurisdiction in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the court or other court of competent jurisdiction shall deem proper.
+ 
+The Registrant s Articles of Incorporation and Bylaws provide that the Registrant may indemnify its officers, directors, employees, agents, and any other persons to the maximum extent permitted by the NRS. The Registrant entered into agreements with its directors to provide contractual indemnification in addition to the indemnification provided in its Bylaws.
+ 
+Insofar as indemnification for liabilities arising under the Securities Act may be permitted to the Registrant s directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Commission, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
+ 
+ 
+II-1
+
+Table of Contents
+ 
+Item 15. Recent Sales of Unregistered Securities.
+ 
+Furnish the information required by Item 701 of Regulation S-K ( 229.701 of this chapter).
+ 
+The Securities Purchase Agreements 
+ 
+On November 10, 2021, we entered into a Securities Purchase Agreement with certain of the selling stockholders pursuant to which we sold to such selling stockholders $560,875 in aggregate principal amount of our common stock and warrants to purchase shares of our common stock, exercisable at any time before the close of business on December 31, 2024. The warrants are comprised of 747,837 warrants with an exercise price of $1.50 per share. 
+ 
+On July 22, 2022, we entered into a Securities Purchase Agreement with one private investor who is not a Selling Stockholder (defined above) to whom we sold $100,000 in aggregate principal amount for 133,333 shares of our common stock and warrants to purchase 133,333 shares of our common stock, with an exercise price of $1.50 per share and exercisable at any time before the close of business on December 31, 2025. As of the date of this filing, the same private investor has committed to purchasing another $100,000 in aggregate principal amount for an additional 133,333 shares of our common stock and warrants to purchase 133,333 shares of our common stock, with an exercise price of $1.50 per share and exercisable at any time before the close of business on December 31, 2025.
+ 
+We closed the transactions contemplated by the Securities Purchase Agreement. We issued the securities contemplated under the Securities Purchase Agreement in reliance upon the exemption from registration pursuant to Section 4(a)(2) of the Securities Act.
+ 
+Item 16. Exhibits and Financial Statement Schedules.
+ 
+(a) Exhibits as required by Item 601 of Regulation S-K.
+ 
+Exhibit No.
+ 
+Description
+
+3.1
+ 
+Articles of Incorporation incorporated by reference to Exhibit 3.1 of our Registration Statement on Form S-1 filed on July 25, 2008
+
+3.2
+ 
+Bylaws, incorporated by reference to Exhibit 3.1 of our Registration Statement on Form S-1 filed on July 25, 2008
+
+3.3
+ 
+Amended Articles of Incorporation as filed with the Nevada Secretary of State on August 8, 2022
+
+4.1
+ 
+Form of Securities Purchase Agreement
+
+5.1
+ 
+Opinion of Counsel regarding the Offering
+
+10.1
+ 
+Raptor Mining LLC Agreement with Ace Hosting
+
+21.1
+ 
+Subsidiaries of the Registrant
+
+23.1
+ 
+Consent of Attorney 
+
+23.2
+ 
+Consent of Accountant
+
+107
+ 
+Filing Fees Table
+
+ 
+(b) No financial statement schedules are provided because the information called for is not required or is shown either in the financial statements or notes. 
+ 
+(c) 6,530, 267 Shares of the Company s Common Stock.
+ 
+Item 17. Undertakings
+ 
+(a) The undersigned Registrant hereby undertakes:
+ 
+(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
+ 
+(i) To include any prospectus required by section 10(a)(3) of the Securities Act;
+ 
+(ii)To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;
+ 
+ 
+II-2
+
+Table of Contents
+ 
+(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (i), (ii) and (iii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is a part of the registration statement;
+ 
+(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
+ 
+(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/VERA_vera_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/VERA_vera_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..6fd1b31a26ec10bc1fd1e216e073634da63e7929
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/VERA_vera_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/WGSWW_genedx_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/WGSWW_genedx_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..902d07bcea152312b8ffa7d5b728ec426c5fde4b
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/WGSWW_genedx_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information contained in greater details elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. You should read the entire prospectus carefully before making an investment in our Class A common stock. You should carefully consider, among other things, our financial statements and related notes and the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus. Company Overview We are a patient-centered, health intelligence company with a mission to use artificial intelligence ( AI ) and machine learning to enable personalized medicine for all. Our integrated information platform leverages longitudinal patient data, AI-driven predictive modeling, and genomics in combination with other molecular and high-dimensional data in our efforts both to deliver better outcomes for patients and to transform the practice of medicine, including how disease is diagnosed, treated, and prevented. We have established one of the largest, most comprehensive, and fastest growing integrated health information platforms, collecting and leveraging genomic and clinical data in partnership with patients, healthcare providers and an extensive ecosystem of life science industry contributors. We are now generating and processing over 47 petabytes of data per month, growing by more than 1 petabyte per month, and maintaining a database that includes approximately 12 million de-identified clinical records, including more than 500,000 with genomic profiles, integrated in a way that enables physicians to proactively diagnose and manage disease. This expanding database is a virtuous cycle of data: new data enables us to further develop, train, and refine predictive models and drive differentiated insights, which models and insights we deploy through our next generation diagnostic and research solutions and portals to support clinicians and researchers and engage patients, all of which interactions generate more data to continue the cycle. Today, by providing differentiated insights through diagnostic testing solutions to physicians and patients across the United States (the U.S. ) in areas such as reproductive health ( Women s Health ), population health, and oncology ( Oncology ), we are reimbursed by payors, providers, and patients for providing these services. In collaboration with pharmaceutical and biotech ( Biopharma ) companies, we receive payments for a broad range of services relating to the aggregated data on our information platform, such as consenting and recontacting patients, the development and implementation of a wide range of predictive models, including drug discovery programs, conducting real-world evidence studies, and aiding in the identification and recruitment of patients into clinical trials. Over the next several years, we expect to focus on expanding the revenue from our health system and Biopharma partners, while also working to continue to grow the volumes and revenues from our diagnostics test solutions. While there are many companies seeking to harness the potential of big data to address the challenges within the healthcare ecosystem, we believe that few have the scale of our company combined with our revenue-generating diagnostics testing business and origins as a company conceived and nurtured within a world-class health system. These characteristics have enabled us to build a significant and highly differentiated technological and informational asset positioned to drive precision medicine solutions into the standard of care in an unparalleled way. Our World Class Team and Unique Origins Sema4 was founded by Eric Schadt, Ph.D. as part of Icahn School of Medicine at Mount Sinai s Department of Genetics and Genomic Sciences and the Icahn Institute for Genomics and Multiscale Biology. Dr. Schadt is a world-renowned expert on constructing predictive models of disease that link molecular data to physiology to enable clinical medicine. He has published more than 450 peer-reviewed papers in leading scientific journals, with a public citation or h-index of 137, and contributed to discoveries relating to the genetic basis of common human diseases such as cancer, diabetes, obesity, and Alzheimer s disease. As of December 31, 2021, we have approximately 1200 employees, including over 160 Ph.D.-level data scientists whose collective work has been recognized in areas such as data science, network modeling, multiscale biotechnology and genomics. The information in this preliminary prospectus is not complete and may be changed. The securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MAY 2, 2022 PRELIMINARY PROSPECTUS Sema4 Holdings Corp. 160,864,198 Shares of Class A Common Stock This prospectus relates to the offer and sale from time to time by the selling stockholders named in this prospectus (the Selling Stockholders ) of up to 160,864,198 shares of our Class A common stock, par value $0.0001 per share ( Class A common stock ), consisting of (i) up to 80,000,000 shares of our Class A common stock (the Stock Consideration Shares ) issued to OPKO Health, Inc. ( OPKO ) as a portion of the consideration for the Acquisition (as defined below), (ii) up to 30,864,198 shares of our Class A common stock (the Milestone Shares ) that may be issuable to OPKO in connection with the achievement of certain revenue-based milestones for each of the fiscal years ending December 31, 2022 and December 31, 2023 and (iii) up to 50,000,000 shares of our Class A common stock (the PIPE Shares ) issued in a private placement pursuant to subscription agreements each entered into on January 14, 2022 (the PIPE Investment ). On April 29, 2022, we consummated the transactions contemplated by that certain Agreement and Plan of Merger, dated as of January 14, 2022 (as amended, the Merger Agreement ), by and among us and our wholly-owned subsidiaries, Orion Merger Sub I, Inc. ( Merger Sub I ) and Orion Merger Sub II, LLC ( Merger Sub II and, together with Merger Sub I, Merger Subs ), and GeneDx, Inc., a New Jersey corporation and wholly-owned subsidiary of OPKO ( GeneDx ), GeneDx Holding 2, Inc., which held 100% of GeneDx at the Effective Time (as defined below) ( Holdco2 ), and OPKO. Pursuant to the terms of the Merger Agreement, we acquired GeneDx through the merger of Merger Sub I with and into Holdco2 (the First Merger ), with Holdco2 as the surviving corporation in the First Merger. Immediately after the consummation of the First Merger, as part of the same overall transaction, Holdco2, as the surviving corporation in the First Merger, merged with and into Merger Sub II (the Second Merger and, together with the First Merger, the Mergers ), with Merger Sub II as the surviving company. After giving effect to the Mergers and the other transactions contemplated by the Merger Agreement, GeneDx was converted into a Delaware limited liability company and became our wholly-owned indirect subsidiary. At the closing of the Acquisition, we paid OPKO $150 million of Cash Consideration (as defined herein) and issued to OPKO the Stock Consideration Shares. Concurrently with the closing, we also consummated the PIPE Investment, issuing the PIPE Shares for aggregate gross proceeds of $200 million. We have filed the registration statement to which this prospectus relates to satisfy certain registration rights obligations we have to the Selling Stockholders in respect of the Stock Consideration Shares, the Milestone Shares and the PIPE Shares. The Selling Stockholders may offer, sell or distribute all or a portion of the securities hereby registered publicly or through private transactions at prevailing market prices or at negotiated prices. We will not receive any of the proceeds from such sales of the shares of our Class A common stock. We will bear all costs, expenses and fees in connection with the registration of these securities, including with regard to compliance with state securities or blue sky laws. The Selling Stockholders will bear all commissions and discounts, if any, attributable to their sale of shares of our Class A common stock. See Plan of Distribution beginning on page 159 of this prospectus. SELECTED DEFINITIONS Unless otherwise stated in this prospectus or the context otherwise requires, references to: Acquisition means the transactions contemplated by the Merger Agreement, including the Mergers. Board or Board of Directors means the board of directors of the Company. Business Combination means the transactions contemplated by the Prior Merger Agreement. Bylaws means the Restated Bylaws of the Company. Cash Consideration means the $150 million in cash paid by the Company to OPKO at the Closing pursuant to the Merger Agreement, subject to certain adjustments as provided in the Merger Agreement. Certificate of Incorporation or Charter means our Third Amended and Restated Certificate of Incorporation, dated as of July 22, 2021, as amended by the Amendment to the Amended and Restated Certificate of Incorporation, dated as of April 29, 2022. Class A common stock means the shares of Class A common stock, par value $0.0001 per share, of the Company. Closing means the closing of the Acquisition. CMLS means CM Life Sciences, Inc. prior to the closing of the Business Combination. Code means the Internal Revenue Code of 1986, as amended. DGCL means the General Corporation Law of the State of Delaware. Earn-Out Shares means the shares of Class A common stock issuable pursuant to the Prior Merger Agreement upon the achievement of certain vesting conditions. Effective Time means the time the First Merger became effective. ESPP means the Sema4 Holdings Corp. 2021 Employee Stock Purchase Plan. Exchange Act means the Securities Exchange Act of 1934, as amended. First Merger means the merger of Merger Sub I with and into HoldCo, with HoldCo as the surviving corporation in the First Merger. GAAP means United States generally accepted accounting principles. GeneDx means (i) GeneDx, Inc., a New Jersey corporation prior to the Closing of the Acquisition and (ii) GeneDx, LLC, a Delaware limited liability company, following the Closing of the Acquisition. HoldCo means GeneDx Holding 2, Inc., which held 100% of GeneDx immediately following the Effective Time. Investment Company Act means the Investment Company Act of 1940, as amended. IPO or CMLS IPO means the Company s initial public offering, consummated on September 4, 2020, of 44,275,000 units (including 5,775,000 units that were subsequently issued to the underwriters in connection with the partial exercise of their over-allotment option) at $10.00 per unit. 2021 EIP means the Sema4 Holdings Corp. 2021 Equity Incentive Plan. JOBS Act means the Jumpstart Our Business Startups Act of 2012. Sema4 was established out of the Mount Sinai Health System (which we refer to together with its related entities as Mount Sinai ) and commenced operations in June 2017 as a commercial entity that could effectively engage diverse patient populations and health care institutions at scale, founded on the idea that more information, deeper AI-driven learning, and increased engagement of patients and their providers will improve diagnosis, treatment, and prevention of disease. We have since established and deployed our comprehensive and integrated genomics and information platforms, and intend to continue to expand our scale and reach through organic and inorganic growth. Our Purpose-Built, Flexible Platforms Address Immediate and Untapped Market Opportunities With the rapid decline in next generation sequencing costs and the increased accessibility of large scale, commoditized computer hardware and storage information products through the cloud, we expect that our core information platform, Centrellis , supported and fueled by our genomic analysis platform, Traversa , will be well-positioned to drive improved clinical outcomes competitively in the healthcare market. Our information platform was built to be highly adaptable to different data types and different diseases and health conditions, with the aim to deliver precision medicine and improved health outcomes across a patient s entire life cycle. Accordingly, we expect our platforms to capitalize on a wide range of growth opportunities, and we intend to apply capital over time to make targeted acquisitions to accelerate our ability to reach a wider range of patients, integrate more deeply into clinical workflows, and address the significant, unaddressed white space for health intelligence in the healthcare ecosystem. These include a broad range of therapeutic segments, beyond our existing focus of our diagnostics solutions for Women s Health, and Oncology, where we believe there is an immediate need for precision medicine solutions such as in autoimmune disorders, where medical care represented over $100 billion of spend in 2011, rare diseases, which is estimated to cost the U.S. healthcare system over $400 billion annually, and cardiovascular disease, where direct medical spend represents approximately $200 billion annually. By combining our data-driven approach and our deep understanding of health system workflows, we have developed a holistic health information platform, Centrellis, to transform the disease diagnosis and treatment paradigm for the entire healthcare ecosystem: patients, physicians, health systems, payers, and Biopharma companies. The Centrellis platform is comprised of a data management backend that supports a wide array of databases, data warehouses, and knowledge bases, a data analytics layer to mine the data and construct predictive models that provide differentiated insights, and a series of application programmable interfaces to enable tool and software applications to access the data and models. Centrellis serves as the underlying foundation of our precision medicine solution and comprises a sophisticated data management and analytics engine. In the data management layer, our platform processes and stores data in a highly structured and accessible way, which is then analyzed by an advanced insights engine in the analytics layer that deploys state-of-the-art AI, probabilistic causal reasoning and machine learning approaches, and complementary analytics capabilities to deliver increasingly accurate insights to patients, providers, and researchers across a broad range of applications. Centrellis is designed to transform treatment decisions across multiple therapeutic areas by engaging large-scale, high-dimensional data and querying the predictive models of disease and wellness using patient-specific data to derive highly personalized, clinically actionable insights. Centrellis supports various applications, such as delivery of personalized and actionable treatment insights into clinical reports, clinical trial matching, real-world evidence trials and clinical decision support, through an advanced programmable interface ( API ) layer. We have also developed a comprehensive genomic platform, Traversa , to serve as the backbone of our screening and diagnostic products and with the capacity to deliver molecular data that can be re-accessed, analyzed and delivered throughout a patient s lifetime. Traversa is designed to simultaneously assay at clinical-grade coverage all known medically relevant regions of the genome, as well as survey the entirety of the human genome, to surface signals that might be medically relevant to a patient in the future. Traversa is integrated with the Centrellis information platform and is designed to adapt at the rate of learning and to match the significant pace of information and knowledge growth, especially in the genomics arena, to allow us to provide actionable, accurate, and cutting-edge insights from complex and comprehensive data assets. We also expect this platform to enable us to scale our operations and to improve our margins in generating secondary insights for patients and providers. Our Class A common stock and public warrants are listed on the Nasdaq Global Select Market (the Nasdaq ) under the symbol SMFR and SMFRW, respectively. On April 29, 2022, the last reported sales price of our Class A common stock was $2.15 per share and the last reported sales price of our public warrants was $0.40 per warrant. We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, and, as such, have elected to comply with certain reduced disclosure and regulatory requirements. Investing in our securities involves risks. See the section entitled Risk Factors beginning on page 8 of this prospectus to read about factors you should consider before buying our securities. The registration statement to which this prospectus relates registers the resale of a substantial number of shares of our Class A common stock by the Selling Stockholders. Sales in the public market of a large number of shares, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our Class A common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022 Former Sponsor means CMLS Holdings LLC, a Delaware limited liability company. Legacy Sema4 means Mount Sinai Genomics, Inc., a Delaware corporation, doing business as Sema4 prior to the consummation of the Business Combination. Lock-Up Holder means certain stockholders of OPKO who entered into the Shareholder Agreements with the Company. Merger Agreement means that certain Agreement and Plan of Merger and Reorganization, dated as of January 14, 2022, by and among the Company, Merger Sub I, Merger Sub II, GeneDx, OPKO, and Holdco, as amended by the Amendment to Agreement and Plan of Merger and Reorganization, dated as of April 29, 2022. Merger Consideration means the Cash Consideration and the Stock Consideration Shares. Merger Sub I means Orion Merger Sub I, Inc. Merger Sub II means Orion Merger Sub II, LLC. Merger Subs means Merger Sub I and Merger Sub II. Mergers means the First Merger and the Second Merger. Milestone Payments means the up to $150 million payable by the Company to OPKO pursuant to the Merger Agreement following the Closing, if certain revenue-based milestones are achieved for each of the fiscal years ending December 31, 2022 and December 31, 2023. Each Milestone Payment, if and to the extent earned under the terms of the Merger Agreement, will be satisfied through the payment and/or issuance of a combination of cash and shares of Class A common stock (valued at $4.86 per share based on the average of the daily volume average weighted price of the Company s Class A common stock over the period of 30 trading days ended January 12, 2022), with such mix to be determined in the Company s sole discretion. Milestone Shares means the up to 30,864,198 shares of our Class A common stock that may be issuable to OPKO in connection with the Milestone Payments. Nasdaq means the Nasdaq Stock Market. OPKO means OPKO Health, Inc. PIPE Investment means the private placement pursuant to which the PIPE Investors collectively subscribed for the PIPE Shares at $4.00 per share, for an aggregate purchase price of $200 million. PIPE Investors means certain institutional investors that invested in the PIPE Investment pursuant to, and on the terms and subject to the conditions of, the Subscription Agreements. PIPE Shares means the 50 million shares of Class A common stock issued in the PIPE Investment. Pre-Closing Restructuring has the meaning ascribed to it in the Merger Agreement. Prior Merger Agreement means that certain Agreement and Plan of Merger, dated as of February 9, 2021, as amended, by and among CMLS, S-IV Sub, Inc. and Legacy Sema4. private placement warrants means the 7,236,667 warrants originally issued to the Former Sponsor and certain of the other initial stockholders of CMLS in a private placement in connection with our IPO, each of which is exercisable for three-quarters of one share of Class A common stock, in accordance with its terms. public shares means shares of Class A common stock included in the units issued in our IPO. public stockholders means holders of public shares. We Are Building Richer Longitudinal Data Through Deeper Patient and Provider Engagement We engage with patients, physicians, and health systems as partners and based on principles of transparency, choice, and consent. Driven by our direct engagement with patients and strategic relationships with multiple health systems, the database we have built contains extensive electronic medical record ( EMR ) data, totaling approximately 12 million de-identified clinical records, many with genomic profiles, and has been designed to enable Centrellis to draw from our extensive data assets in a way that enables physicians to proactively diagnose and manage disease. We expect our current and targeted strategic relationships will provide us with access to additional active patient cohorts and datasets to fuel this growth and perpetuate our iterative, data-driven business model, including by rapidly scaling our diagnostic test solutions franchise with physicians and patients through direct engagement with multiple health system partners. In addition to providing a majority of our current revenue and generating hundreds of thousands of genomic profiles, our established diagnostic test solutions also allow us to engage patients directly as partners, both as part of their clinical care and also acting on their behalf, with appropriate informed consent, to acquire, organize and manage any health data generated on them through the course of their care, all of which contributes to the further development of our genomics and information platforms. Further, we have demonstrated patients willingness to partner with us. For example, over 80% of diagnostics solutions patients and users who engaged with our patient portal have given us their informed consent to retrieve, organize, and manage their health records and data, and to facilitate their access to and sharing of that data, as well as additional data that patients share and create through their use of our expanding suite of digital experience products. Our Established Diagnostic Solutions Are Scaling Rapidly We currently operate a mature diagnostic business that generates revenue and engages with patients through our varied and sophisticated diagnostics and screening offerings. Our population health offerings are designed to run through our Traversa platform and give us the ability to inform on thousands of diseases and conditions, from rare disorders, to drug safety, to risk profiles across a broad range of common human diseases of significant public health concern. We have developed an array of diagnostic and screening solutions to inform across a patient s life course, ranging from reproductive health and newborn screening to drug safety and oncology. Our Women s Health solutions sequence and analyze an industry-leading number of genes, and use Centrellis interpretive information tools to translate raw sequencing and clinical data efficiently and accurately into digestible clinical reports that guide decision making by patients and physicians. Our Oncology diagnostic solutions feature both somatic tumor profiling and hereditary cancer screenings, along with a foundational whole exome and whole transcriptome sequencing approach. Centrellis enables the complex interpretations of these data to identify key driver genes, activated and suppressed pathways, molecular subtypes, therapeutic interventions and matching to clinical trials. We believe our array of diverse diagnostic solutions, built on our differentiated grounding in scientific excellence and coupled with an end-to-end full-service model, have led to our rapidly growing customer bases in Women s Health and Oncology and increasing traction with health systems, as well as deep, trusting engagement with patients. We Are Embedding Our Solutions Through Innovative, Deep Relationships Our origins in and subsequent work with Mount Sinai have provided us with an extensive understanding of health systems, patient, and physician workflows as well as the complex interconnectivities that define patient-physician relationships. We have used this knowledge to develop our integrated health system collaboration model, where we have the capabilities necessary to integrate across health system workflows as a holistic health intelligence partner in order to deploy our comprehensive genomics and information platforms, our data curation and harmonization capabilities, and our patient and provider engagement software applications. Our solutions support our health system partners across their operations, helping them integrate a new standard of care and creating a deep relationship with us that helps both partners realize the potential of the relationship. In addition to creating diagnostic revenue and a clinical relationship with our health system partners and their patients, this engagement provides us with access to insights informed by analyzed and processed EMRs from the health system, as well as the expansive molecular information we generate from our genomics platform as the health system s precision medicine public warrants means the warrants included in the units issued in our IPO, each of which is exercisable for three-quarters of one share of Class A common stock, in accordance with its terms. Related Agreements means, collectively, the Shareholder Agreements, the Subscription Agreements and the Support Agreements. RSUs means restricted stock units granted under the 2017 EIP, 2021 EIP or pursuant to the Prior Merger Agreement. SEC means the United States Securities and Exchange Commission. Second Merger means the merger of HoldCo, as the surviving corporation in the First Merger, with and into Merger Sub II, with Merger Sub II as the surviving company. Securities Act means the Securities Act of 1933, as amended. Shareholder Agreements means, collectively, those certain shareholder agreements entered into on January 14, 2022, between the Company and OPKO and the Lock-Up Holders, pursuant to which OPKO and the Lock-Up Holders have agreed, among other things, to certain transfer restrictions in respect of the shares of Class A common stock issues and to be issued pursuant to the Merger Agreement. Sarbanes-Oxley Act or SOX means the Sarbanes-Oxley Act of 2002. Selling Stockholders means the selling stockholders named in this prospectus. Stock Consideration Shares means the 80 million shares of Class A common stock issued by the Company to OPKO at the Closing pursuant to the Merger Agreement. stockholders means holders of shares of the Company s Class A common stock. Subscription Agreements means, collectively, those certain subscription agreements entered into on January 14, 2022, between the Company and the PIPE Investors, pursuant to which such investors agreed to purchase the PIPE Shares in the PIPE Investment on the terms and subject to the conditions of the Subscription Agreements. Transfer Agent means Continental Stock Transfer & Trust Company. partner. Learning from our long-standing relationship with Mount Sinai, we have refined a health system engagement model that is both operational and economic and designed to maximize both our and our health system partner s value from the relationship. We are currently activating and expanding our relationships with several leading health systems that will expand our access to data and that we expect will position our platforms for rapid growth and broad commercial opportunities, and have recently signed contracts with three new health systems in support of this strategy. Centered on Centrellis and Traversa, we have also established and continue to seek strategic relationships with Biopharma companies to enable innovation across the entire drug lifecycle, from next generation drug discovery and development, to post-market efficacy surveillance, to informing on bioavailability, toxicity, tolerability, and other features critical to drug development. We have demonstrated the ability to integrate across all aspects of the next generation therapeutic and drug development process, including: biomarker identification as part of early stage drug discovery; identification, validation and prioritization of drug targets; clinical trial patient recruitment; real-world evidence studies; and identifying new markets and indications for existing assets. We believe our solutions allow our Biopharma partners to harness the potential of big data to enable the development of next generation precision medicine therapeutics. Recent Developments On April 29, 2022, we consummated the transactions contemplated by the Merger Agreement, whereby we acquired GeneDx through the Mergers and paid OPKO $150 million of Cash Consideration and issued to OPKO 80 million of Stock Consideration Shares. Concurrently with the Closing, we also consummated the PIPE Investment, issuing 50 million PIPE Shares for aggregate gross proceeds of $200 million. We have filed the registration statement to which this prospectus relates to satisfy certain registration rights obligations we have to the Selling Stockholders in respect of the Stock Consideration Shares, the Milestone Shares and the PIPE Shares. Corporate Information We were incorporated on July 10, 2020 as a special purpose acquisition company and a Delaware corporation under the name CM Life Sciences, Inc. ( CMLS ). On September 4, 2020, CMLS completed its initial public offering. On July 22, 2021, CMLS consummated the Business Combination with Legacy Sema4 pursuant to the Prior Merger Agreement. In connection with the Business Combination, CMLS changed its name to Sema4 Holdings Corp. ( Sema4 Holdings ). Our address is 333 Ludlow Street, North Tower, 8th Floor, Stamford, Connecticut 06902. Our telephone number is 1(800) 298-6470. Our website address is https://sema4.com. Information contained on our website or connected thereto does not constitute part of, and is not incorporated by reference into, this prospectus or the registration statement of which it forms a part.
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