- The information in the offering circular should
be organized to make it easier to understand the organization and operation of
the company. The required information need not be in any particular order, except
that Items 1 and 2 must be the first and second
items in the offering circular.
- The offering circular, including the cover
page, may contain more information than is called for by this Schedule, provided
that it is not incomplete, inaccurate, or misleading. Also, the additional information
should not, by its nature, quantity, or manner of presentation, obscure or impede
understanding of required information.
Item 1. Cover Page
The cover page of the offering circular shall include the following information:
- The name of the issuer;
- The mailing address of the issuer's
principal executive offices including the zip code and the issuer's telephone
- The date of the offering circular;
- A list of the type and amount of
securities offered (e.g., if the securities offered include redemption or conversion
features, so state);
- The following statement in capital
letters printed in boldface roman type at least as large as ten-point modern type
and at least two points leaded:
"THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION
WITH THE SECURITIES AND EXCHANGE COMMISSION; HOWEVER, THE COMMISSION HAS NOT MADE
AN INDEPENDENT DETERMINATION THAT THE SECURITIES BEING OFFERED ARE EXEMPT FROM
REGISTRATION. THE SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE MERITS
OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING,
NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR
OTHER SELLING LITERATURE."
- The name of the underwriter or underwriters,
- A cross-reference to the place in
the offering circular discussing the material risks involved in purchasing the
securities, printed in bold-face roman type at least as high as ten-point modern
type and at least two points leaded;
- The approximate date when the proposed
sale to the public will begin; and
- The information called for by the
following table shall be given, in substantially the tabular form indicated, on
the outside front cover page of the offering circular as to all securities being
offered (estimate, if necessary):
Underwriting Proceeds to
Offering discounts issuer or
price to and other
public commissions persons
Per share or other unit basis......... ........... ............ ...........
Total................................. ........... ............ ...........
If the securities are to be offered on a best efforts basis, the cover page should
set forth the termination date, if any, of the offering, any minimum required
sale, and any arrangements to place the funds received in an escrow, trust, or
similar arrangement. The following tabular presentation of the total maximum and
minimum securities to be offered should be combined with the table required above:
Underwriting Proceeds to
Offering discounts issuer or
price to and other
public commissions persons
Total Minimum......................... ........... ............ ...........
Total Maximum......................... ........... ............ ...........
- The term commissions shall
include all cash, securities, contracts, or anything else of value, paid, to be
set aside, disposed of, or understandings with or for the benefit of any other
persons in which any underwriter is interested, made in connection with the sale
of such security.
- Only commissions paid by the issuer in
cash are to be indicated in the table. Commissions paid by other persons or any
form of non-cash compensation shall be briefly identified in a note to the table
with a cross-reference to a more complete description elsewhere in the offering
- If the securities are not to be offered
for cash, state the basis upon which the offering is to be made.
- If it is impracticable to state
the price to the public, briefly state the method by which the price is to be
- Any finder's fees
or similar payments must be disclosed in a note to the table with a reference
to a more complete discussion in the offering circular.
- The amount of the expenses
of the offering borne by the issuer, including underwriting expenses to be borne
by the issuer, should be disclosed in a note to the table.
- If any of the securities are to be offered
for the account of any security holder, state the identity of each selling security
holder, the amount owned by him, the amount offered for his account and the amount
to be owned after the offering.
Item 2. General Description of Issuer
- Concisely discuss the organization
and operation or proposed operation of the issuer. Include the following:
- Basic identifying information,
- The date and form of organization
of the issuer and the name of the state under whose laws it is organized;
- A brief description of the nature
of a small business investment company; and
- The classification and subclassification
of the issuer as specified in sections 4
and 5 of the Investment
Company Act of 1940.
- A concise description of the investment
objectives and policies of the issuer, including:
- If those objectives may be changed
without a vote of the holders of the majority of the voting securities, a brief
statement to that effect; and
- A brief discussion of how the
issuer proposes to achieve its objectives, including:
- The types of securities (for
example, bonds, convertible debentures, preferred stocks, common stocks) in which
it may invest, and the proportion of the assets which may be invested in each
such type of security;
- If the issuer proposes to
have a policy of concentrating in a particular industry or group of industries,
identification of such industry or industries.
- A concise description of any
other policies of the issuer that may not be changed without the vote of the majority
of the outstanding voting securities, including those policies which the issuer
deems to be fundamental within the meaning of Section
8(b) of the Investment Company Act of 1940.
- A concise description of those
significant investment policies or techniques (such as investing for control or
management or investing in other investment companies) that are not described
pursuant to subparagraphs or above that issuer employs or has the current intention
of employing in the foreseeable future.
Note: If the effect of a policy
is to prohibit a particular practice, or, if the policy permits a particular practice
but the issuer has not employed that practice within the past year and has no
current intention of doing so in the foreseeable future, do not include disclosure
as to that policy.
- Discuss briefly the principal risk
factors associated with investment in the issuer, including factors peculiar to
the issuer as well as those generally attendant to investment in a small business
investment company with investment policies and objectives similar to the issuer.
Item 3. Plan of Distribution
- If the securities are to be offered
through underwriters, give the names of the principal underwriters, and state
the amounts underwritten by each. Identify each underwriter having a material
relationship to the issuer and state the nature of the relationship. State briefly
the nature of the underwriters' obligation to take the securities.
- State briefly the discounts and commissions
to be allowed or paid to dealers, including all cash, securities, contracts or
other consideration to be received by any dealer in connection with the sale of
- If finder's fees are
to be paid, identify the finder, the nature of the services rendered and
the nature of any relationship between the finder and the issuer, its officers,
directors, promoters, principal stockholders and underwriters (including any affiliates
thereof). If a finder is not registered with the Commission as a broker
or dealer, disclose that fact.
- Outline briefly the plan of distribution
of any securities being issued which are to be offered through the selling efforts
of brokers or dealers or otherwise than through underwriters.
- Describe any arrangements for the
return of funds to subscribers if all of the securities to be offered are not
sold; if there are no such arrangements, so state.
- If there will be material delay
in the payment of the proceeds of the offering by the underwriter to the issuer,
the nature of the delay and the effects on the issuer should be briefly described.
Item 4. Management and Certain Security Holders of
- Give the full names and complete
addresses of all directors, officers, members of any advisory board of the issuer
and any person who owns more than 5 percent of any class of securities of the
issuer (other than the Small Business Administration if the issuer is a small
business investment company as defined in Rule 602(a).
- Identify each person who as of a specified
date no more than 30 days prior to the date of filing of this registration statement,
controls the issuer as specified in section
2(a)(1) of the Investment Company Act of 1940
- Give the business experience over
the last five years of any person named in (a) above who is or is expected to
be significantly involved in the investment decisions of the issuer or in providing
advisory services, direction or control of portfolio companies of the issuer.
- State the aggregate annual remuneration
of each of the three highest-paid persons who are officers or directors of the
issuer and all officers and directors as a group during the issuer's last fiscal
year. State the number of persons in the group referred to above without naming
- Describe all direct and indirect
interests (by security holdings or otherwise) of each person named in (a) above
(i) in the issuer and (ii) in any material transactions within the past two years
or in any material proposed transaction to which the issuer was or is to be a
party. Include the cost to such persons of any assets or services for which any
payment by or for the account of the issuer has been or is to be made.
- Provide, if applicable, for each investment
adviser of the issuer as defined in section 2(a)(1) of the Investment Company
Act of 1940
- The name and address of the investment
adviser and a brief description of its experience as an investment adviser, and,
if the investment adviser is controlled by another person, the name of that person
and the general nature of its business. (If the investment adviser is subject
to more than one level of control, it is sufficient to give the name of the ultimate
- A brief description of the services
provided by the investment adviser. (If, in addition to providing investment advice,
the investment adviser or persons employed by or associated with the investment
adviser are, subject to the authority of the board of directors, responsible for
overall management of issuer's business affairs, it is sufficient to state that
fact in lieu of listing all services provided.)
- A brief description of the investment
adviser's compensation. (If the issuer has been in operation for a full fiscal
year, provide the compensation paid to the adviser for the most recent fiscal
year as a percentage of average net assets. No further information is required
in response to this Item if the adviser is paid on the basis of a percentage of
net assets and if the issuer has neither changed investment advisers nor changed
the basis on which the adviser was compensated during the most recent fiscal year.
If the fee is paid in some manner other than on the basis of average net assets,
briefly describe the basis of payment. If the registrant has not been in operation
for a full fiscal year, state generally what the investment adviser's fee will
be as a percentage of average net assets, including any breakpoints, but it is
not necessary to include precise details as to how the fee is computed or paid.)
Item 5. Portfolio Companies
Furnish the following information, in the tabular form indicated, with respect
to the portfolio companies of the issuer, as of a specified date within 90 days
prior to the date of filing the notification with the Commission pursuant to an
offering of securities under Regulation E.
Title of Number of shares
Name and address Nature of its securities owned, or amount of loan
of portfolio principal business controlled or held to portfolio
companies by issuer companies
Percentage of class of
securities owned, Percentage of total
controlled or held by Value value of portfolio
- Provide the city and state for address
of portfolio companies.
- State the value as of date of balance
sheet required under Item 7.
Item 6. Capital Stock and Other Securities
- Describe concisely the nature and
most significant attributes of the security being offered, including:
- a brief discussion of voting rights;
- restrictions, if any, on the right freely
to retain or dispose of such security;
- conversion rights, if applicable; and
- and any material obligations or potential
liability associated with ownership of such security (not including risks).
- If the rights of holders of such
security may be modified otherwise than by a vote of majority or more of the shares
outstanding, voting as a class, so state and explain briefly.
- If issuer has any other classes of
securities outstanding (other than bank borrowings or borrowings that are not
senior securities under Section 18(g) of
the Investment Company Act of 1940 identify them and state whether they have any
preference over the security being offered.
- Describe briefly the issuer's policy
with respect to dividends and distributions, including any options shareholders
may have as to the receipt of such dividends and distributions.
- Describe briefly the tax consequences
to investors of an investment in the securities being offered. Such description
should not include detailed discussions of applicable law. If the issuer intends
to qualify for treatment under Subchapter M, it is sufficient, in the absence
of special circumstances, to state briefly that in that case:
- the issuer will distribute all of
its net income and gains to shareholders and that such distributions are taxable
income or capital gains;
- shareholders may be proportionately
liable for taxes on income and gains of the issuer but that shareholders not subject
to tax on their income will not be required to pay tax on amounts distributed
to them; and that
- the issuer will inform shareholders
of the amount and nature of such income or gains.
- Where there is a material disparity
between the public offering price and the effective cash cost to officers, directors,
promoters and affiliated persons for shares acquired by them in a transaction
during the past three years, or which they have a right to acquire, there should
be included a comparison of the public contribution under the proposed public
offering and the effective cash contribution of such persons. In such cases, and
in other instances where the extent of the dilution makes it appropriate, the
following shall be given:
- the net tangible book value per
share before and after the distribution;
- the amount of the increase in such
net tangible book value per share attributable to the cash payment made by purchasers
of the shares being offered; and
- the amount of the immediate dilution
from the public offering price which will be absorbed by such purchasers.
Item 7. Financial Statements
Furnish appropriate financial statements of the issuer as required below. Such
statements shall be prepared in accordance with generally accepted accounting
principles and practices. The statements required for the issuer's latest fiscal
year shall be certified by an independent public accountant or certified public
accountant in accordance with Regulation S-X if the issuer has filed or is required
to file with the Commission certified financial statements for such fiscal year;
the statements filed for the period or periods preceding such latest year need
not be certified.
- A blance sheet as of a date within
90 days prior to the date of filing the notification with the Commission.
- A profit and loss or income statement
for each of the last two fiscal years and for any subsequent period up to the
date of the balance sheet furnished pursuant to (a) above.