Business Description: Superbrew Acquisition Inc. produces and distributes real fruit-based hard beverages (4.5-6.0% alcohol) that are low-calorie, gluten-free, and vegan. Unlike traditional blended seltzers (White Claw, Truly), the Company’s beverages are brewed, offering a unique, more flavorful alternative within the “beyond beer” category.
Sales Drivers: A relaunched Company, Willie’s Superbrew is a well-known brand with a strong customer base (120,000 cases sold across 10 states in 2021). Preexisting relationships with distributors (10 by 8/2023) and retailers (300 targeted by 8/2023) are now accelerating the re-introduction of 3 product SKUs to market in 6 states. Using a data-driven approach, the Company strategically optimizes its yield from marketing campaigns to ensure comprehensive product placement across its servicing footprint.
Addressable Market: The “beyond beer” market is currently a $10BN opportunity in the U.S., with approximately 1/3 consumed in the Northeast and Southeast – the Company’s initial target markets. Partnerships with co-packers ensure that Willie’s Superbrew can be brewed anywhere in the U.S and enable the Company to remain asset-light, reducing capital requirements.
Management: Superbrew Acquisition Inc. is led by CEO Mark Hegedus, a 35-year beverage-industry veteran (AB InBev, Molson-Coors, Red Bull). Under his guidance, the Company has assembled an experienced leadership team.
Superbrew Acquisition Inc. (“Superbrew”, the “Issuer”, or “The Company”) is issuing a minimum of $1,000,000 and up to $2,600,000 in Series Seed Preferred Stock (the “Stock” or “Securities”) to build inventory to meet distribution goals.
Superbrew Acquisition Inc. was incorporated in Delaware in June 2022 by a consortium of three investors, facilitating the purchase of key assets by the Company from Farmer Willie’s in August 2022. Following the acquisition of Farmer Willie’s assets by the Company, the founders of Superbrew Acquisition Inc. supported preliminary operations with a series of bridge note investments, which will be rolled into the current capital raise on the same terms.
Superbrew Acquisition Inc. was formed based on the strong belief that Farmer Willie's fruit-centric recipes, distinctive brewing methods, and brand recognition are unique and differentiated assets whose value can be realized under new management with a clearer commercialization focus.
Going forward, Superbrew Acquisition Inc.’s mission is to push the “beyond beer” boundary and deliver uncompromisingly fun and exciting beverages brewed with real ingredients. The Company is equally committed to the health and lifestyle attributes that drinkers (especially younger and more active consumers) are increasingly seeking, namely a low-carb, low-calorie, gluten-free, vegan profile.
Chief Executive Officer (CEO): Mark Hegedus, a beverage industry veteran, will manage and oversee the execution of the Company’s product, marketing, manufacturing, and distribution strategies. Prior to joining Willie’s Superbrew, Hegedus served as Chief Commercial Officer at Untitled Art Beverages in Wisconsin and as Chief Sales Officer at Founders Brewing Company in Michigan. He also was President at the iconic Magic Hat Brewery in Vermont and held senior leadership roles at multiple AB InBev craft breweries. Hegedus also worked for a number of top consumer product companies like Red Bull, Molson-Coors, and Procter & Gamble.
Sales Director: Thomas Chrane will lead the Company in driving sales volume growth. Prior to joining Willie’s Superbrew, Chrane served as Director of Sales with Lone Pine Brewery in Maine and Vermont Cider Company in Vermont. He also held management positions with Pabst Brewing Company in California, Vermont Hard Cider Company, Craft Brewers Alliance in Oregon, and Redhook Ale Brewery and Bellavance Beverage in New Hampshire.
Sales Operations Director: Amanda Sylvester will lead the Company in operations. Prior to joining Willie’s Superbrew, Sylvester served as the Portfolio Company Operations Administrator for Downing Capital Group and in Client Services with Bigelow LLC. She also obtained beverage industry experience with key marketing roles at Magic Hat Brewing Company in Vermont and Blue Point Brewing Company in NY.
Director of Marketing: Adrienne Mathias will lead the marketing and innovation strategy efforts for the Company. Prior to joining Willie’s Superbrew, Mathias was co-founder and president of the Creatively Partners agency. She also was Director of Consumer Marketing for Sperry and held multiple leadership positions with top agencies Hill Holiday and Carmichael Lynch.
The Company’s products owe their distinctive attributes to the proprietary production methods the Company has developed, utilizing real ingredients, particularly real fruit, to create the depth and complexity that consumers demand in a brewed beverage. Instead of blending “natural” or artificial flavoring with a prefabricated alcohol base, Superbrew Acquisition Inc. delivers on the promise laid out on its cans: it ferments and brews with real ingredients to bring out their full flavor.
The Company’s beverages regularly defy attempts to be categorized as either a beer or a hard seltzer. Superbrew Acquisition Inc. has not only racked-up a formidable list of accolades from influential industry commentators, it has also won a significant number of awards over the past 5 years in both beer and hard seltzer competitions. The breadth of awards earned by the Company’s Superbrews tangibly and externally validate Superbrew’s success at creating a quality product.
New York City International Beer Competition (nyibeercompetition.com)
Great International Beer, Cider, Mead, & Sake Competition (gibcc.com)
Los Angeles International Beer Competition (fairplex.com/competitions/beer-competition)
Fizz Fight (fizzfight.com)
Food & Wine
Consumers today are health conscious
According to surveys conducted by the Company, customers prioritize two key factors when selecting alcohol to purchase: the ability to list all ingredients and a low calorie count. A close third in importance is sugar content. These preferences align with the declining sales in the traditional beer market, as consumers increasingly opt for lower calorie and gluten-free beverages.
Willie's Superbrew, brewed with real superfruits and other natural ingredients, is well-positioned to capture this growing demand, providing an ideal choice for health-conscious consumers seeking a flavorful and refreshing alternative in the alcohol market.
Consumers prefer craft beverage companies over large corporations
In today's market, consumers demonstrate a preference for local companies and sustainable business practices over large, faceless corporations. This trend indicates that businesses that prioritize local sourcing, ethical practices, and environmental responsibility are likely to gain favor and build stronger connections with their target audience. Taking a craft approach to the hard seltzer space, Superbrew fosters greater trust and loyalty among health-conscious consumers seeking products that reflect their personal values and contribute positively to the community and the environment.
The alcoholic beverage market has historically been divided into three large categories: spirits, wine, and beer. Beer today remains a juggernaut alcohol category valued at approximately $115Bn annually in the US. Compared to other alcohol categories, beer has a great value proposition in that it is convenient, social, and affordable. However, the category has seen gradual declines in recent years due to a host of factors, including demographics, health consciousness, and changing taste preferences to name a few. Yet another driver of beer’s market share loss is the growth of the “beyond beer” market.
The “beyond beer” category is constantly adapting to market dynamics but traces its roots to the craft beer movement. The emergence of craft beers was a function of stagnant innovation in the mass market beer producers coupled with an evolution of the consumer, who began seeking deeper flavor profiles and greater authenticity from brewers. The “beyond beer” category has expanded rapidly as somewhat of a catch-all category which includes ciders, hard kombuchas, and hard seltzers. Today, brands and new flavorings are prolific and existing brewers, including the mega alcohol corporations, offer consumers a wide array of options.
Consumers looking for an alternative to beer led to the rise of hard seltzers, which are seen as lighter, lower calorie, and more diverse in flavorings than traditional beers. However, while hard seltzers emerged as a more drinkable alternative, the Company finds that trendy hard seltzers consistently fall flat on the promise of flavor. Superbrew Acquisition Inc. is poised to step into the much-needed role of a truly flavorful, all-natural hard seltzer.
The preceding financial projections reflect the Company’s best estimated forecasts and are not guaranteed to be accurate. The timing of performance is estimated post-funding. These figures are forward-looking statements and reflect the Company’s views about various future events or expectations. These figures take into account known and unknown risks, uncertainties and other factors and assumptions which may cause the Company’s actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by this forward-looking financial projection. Please see the note regarding forward-looking statements. A full version of this pro-forma financial model is available through carofin.com.
The Series Seed-1 and Series Seed-2 Preferred Stock (collectively, the “Series Seed Preferred Stock”). The Series Seed Preferred Stock converts 1:1 into Common Stock at the option of the holder. The security pays no dividend and is senior to any other equity issued by the Company.
Superbrew Acquisition Inc., a Delaware corporation (the “Company”).
A minimum of $1,000,000 and up to $2.6 million, with $1.7 million available (the “Financing”). The Financing amount includes the conversion of convertible notes in the principal amount of $900,000 (the “Convertible Notes”).
As soon as practicable following the receipt of commitments from investors of at least $1,000,000 and satisfaction of the conditions to closing (the “Initial Closing”). Other Investors may close after the Initial Closing, provided that such additional closings are held within 180 days of the Initial Closing.
Until the Initial Closing, proceeds from the sale of the Series Seed Preferred Stock will be aggregated in an escrow account with U.S. Bank acting as custodian.
The price per share of the Series Seed Original Purchase Price was based on a fully diluted pre-money valuation of $4 million, excluding the conversion of the Convertible Notes. The fully diluted post-money valuation shall be $7 million (assuming (i) full subscription of the round, (ii) conversion of notes, including accrued interest, and (iii) the Carofin warrants).
The Series Seed-1 price per share is $4.44
The price per share of Series Seed Preferred Stock implied by the pre-money valuation below (based on the capitalization of the Company set forth below and corresponding capitalization backup) (the “Series Seed Original Purchase Price”), provided that the Series Seed Original Purchase Price applicable to the Series Seed-2 Preferred Stock shall be equal to the conversion price at which the Company’s outstanding Convertible Notes convert into Series Seed-2 Preferred Stock. For the avoidance of doubt, but for the Series Seed Original Purchase Price, Series Seed-1 and Series Seed-2 Preferred Stock shall have the same rights and terms.
300,000 shares have been reserved for the employee stock option pool of which 184,000 have been granted. Other than the Convertible Notes and a stock award granted pursuant to and subject to the Company’s equity incentive plan, the Company has no other convertible notes, or similar instruments or convertible securities outstanding.
Dividends will be paid on the Series Seed Preferred Stock on an as converted basis when, as, and if declared by the Company’s Board of Directors (the “Board”) or paid on the Common Stock.
In the event of any liquidation, dissolution or winding up of the Company, the proceeds shall be paid as follows:
First pay one times the Series Seed Original Purchase Price of the relevant Series Seed-1 and Series Seed-2 Preferred Stock, plus declared and unpaid dividends on each share of Series Seed Preferred Stock (or, if greater, the amount that the Series Seed Preferred Stock would receive on an as-converted basis). The balance of any proceeds shall be distributed pro rata to holders of Common Stock.
A merger or consolidation (other than one in which stockholders of the Company own a majority by voting power of the outstanding shares of the surviving or acquiring corporation) or a sale, lease, transfer, exclusive license or other disposition of all or substantially all of the assets of the Company will be treated as a liquidation event (a “Deemed Liquidation Event”), thereby triggering payment of the liquidation preferences described above unless the holders of a majority of the Series Seed Preferred Stock elect otherwise (the “Requisite Holders”). The Investors’ entitlement to their liquidation preference shall not be abrogated or diminished in the event part of the consideration is subject to escrow in connection with a Deemed Liquidation Event.
The Series Seed Preferred Stock shall vote together with the Common Stock on an as-converted basis, and not as a separate class, except (i) so long as 50% of the shares of Series Seed Preferred Stock issued in the transaction are outstanding, the Series Seed Preferred Stock as a separate class shall be entitled to elect one member of the Board of Directors (the “Series Seed Director”), (ii) the Common Stock as a class shall be entitled to designate three (3) members of the Board (the “Common Directors”), one of which shall be the CEO and (iii) the Board shall be entitled to otherwise designate one member of the Board of Directors subject to the Company’s bylaws. The Company’s Certificate of Incorporation will provide that the number of authorized shares of Common Stock may be increased or decreased with the approval of the holders of a majority of the Series Seed Preferred Stock and Common Stock, voting together as a single class on an as converted to Common Stock basis, and without a separate class vote by the Common Stock.
So long as 50% of shares of Series Seed Preferred Stock issued in the transaction are outstanding, in addition to any other vote or approval required under the Company’s Charter or Bylaws, the Company will not, without the written consent of the Requisite Holders, either directly or by amendment, merger, consolidation, recapitalization, reclassification, or otherwise:
(i) liquidate, dissolve or wind-up the affairs of the Company, or effect any (a) merger or consolidation, (b) any other Deemed Liquidation Event, (c) SPAC transaction, or (d) reverse merger transaction with a public company; (ii) amend, alter, or repeal any provision of the Certificate of Incorporation or Bylaws in a manner that adversely affects the powers, preferences, or rights of the Series Seed Preferred Stock; (iii) (iii) purchase or redeem or pay any dividend on any capital stock prior to the Series Seed Preferred Stock, other than stock repurchased from former employees, consultants, or other service providers in connection with the cessation of their employment/services, at the lower of fair market value or cost; (iv) create or hold capital stock in any subsidiary that is not a wholly-owned subsidiary or dispose of any subsidiary stock or all or substantially all of any subsidiary assets; or (v) increase or decrease the size of the Board.
The Series Seed Preferred Stock initially converts 1:1 to Common Stock at any time at option of holder, subject to adjustments for stock dividends, splits, combinations and similar events and as described below under “Anti-dilution Provisions.”
The Series Seed Preferred Stock shall have broad-based weighted average anti-dilution rights, subject to customary exceptions.
Each share of Series Seed Preferred Stock will automatically be converted into Common Stock at the then applicable conversion rate (i) in the event of the closing of a firm commitment underwritten public offering with a price of five times the Series Seed Original Purchase Price (subject to adjustments for stock dividends, splits, combinations and similar events) and net proceeds to the Company of not less than $30.0 million (a “QPO”), or (ii) upon the written consent of the holders of a majority of the Series Seed Preferred Stock.
Standard representations and warranties by the Company, which shall include legal and regulatory compliance.
Standard conditions to Closing, which shall include, among other things, satisfactory completion of financial and legal due diligence, qualification of the shares under applicable Blue Sky laws, and the filing of a Certificate of Incorporation establishing the rights and preferences of the Series Seed Preferred Stock. At the Initial Closing, the Company will enter into the Investors’ Rights Agreement and other agreements contemplated in connection with this Series Seed Preferred Stock Financing.
Company counsel to draft applicable corporate governing documents using NVCA model forms. Investors are responsible for their own legal fees in reviewing the investment documents.
Major Investors to be granted customary registration rights.
Any Major Investor (who is not a competitor) will be granted access to Company facilities and personnel during normal business hours and with reasonable advance notification; provided, any request for information will be subject to Section 220 of the Delaware General Corporation Law. The Company will deliver to such Major Investor (i) annual and quarterly financial statements; (ii) thirty days prior to the end of each fiscal year, a comprehensive operating budget forecasting the Company’s revenues, expenses, and cash position on a month-to-month basis for the upcoming fiscal year; and (iii) any other information as determined by the Board. A “Major Investor” means any Investor who purchases at least $100,000 of Series Seed Preferred Stock (based on the Series Seed Original Purchase Price).
All Investors shall have a pro rata right, based on their percentage equity ownership in the Company (assuming the conversion of all outstanding Series Seed Preferred Stock into Common Stock and the exercise of all options outstanding under the Company’s stock plans), to participate in subsequent issuances of equity securities of the Company (with customary exclusions).
So long as the holders of Series Seed Preferred Stock are entitled to designate a Series Seed Director, the Company will not, without Board approval, which approval must include the affirmative vote of the Series Seed Director:
(i) make any loan or advance to, or own any stock or other securities of, any subsidiary or other corporation, partnership, or other entity unless it is wholly owned by the Company; (ii) make any loan or advance to any person, including, any employee or director, except advances and similar expenditures in the ordinary course of business or under the terms of an employee stock or option plan approved by the Board; (iii) guarantee any indebtedness except for trade accounts of the Company or any subsidiary arising in the ordinary course of business; (iv) make any investment inconsistent with any investment policy approved by the Board; (v) incur any aggregate indebtedness, including by issuance of any debt security, in excess of $1,000,000 (other than trade credit incurred in the ordinary course of business) that is not already included in a budget approved by the Board, including the Series Seed Director; (vi) enter into or be a party to any transaction with any director, officer, or employee of the Company or any “associate” (as defined in Rule 12b-2 promulgated under the Exchange Act) of any such person other than with respect to at will offer letters for employment; or (vii) adopt, amend, or increase amounts that may be granted under any equity incentive plan, phantom equity plan, or similar arrangement.
Each current employee and consultant will have entered into a non-disclosure and proprietary rights assignment agreement.
The Board shall meet at least quarterly, unless otherwise agreed by a vote of the majority of directors.
Unless otherwie approved by the Board, all employee options granted after the Initial Closing shall vest as follows: 25% after one year, with remaining vesting monthly over next 36 months.
The Company first and Investors second will have a right of first refusal with respect to any shares of capital stock of the Company proposed to be transferred by any employees holding greater than 1% of the Company’s Common Stock (assuming conversion of Series Seed Preferred Stock and whether then held or subject to the exercise of options), with a right of oversubscription for Investors of shares unsubscribed by any other Investors. Before any such person may sell Common Stock, such person will give the Investors an opportunity to participate in such sale on a basis proportionate to the amount of securities held by the seller and those held by the participating Investors. In each case, the Right of First Refusal and Right of Co-Sale shall not apply to certain customary excepted transactions.
At the Initial Closing, the Board shall consist of five (5) members comprised of (i) Amos Beason as a representative designated by the holders of Common Stock, (ii) Mark Hegedus as a representative, conditioned on his status as the Chief Executive Officer of the Company, (iii) Marcia Hooper as a representative designated by the holders of Common Stock, (iv) [name] as the representative designated by the holders of Series Seed Preferred Stock, and (v) an independent director to be elect by majority vote of the other Directors.
Holders of Series Seed Preferred Stock, Common Stock, and all future holders of greater than 1% of Common Stock (assuming conversion of Series Seed Preferred Stock and whether then held or subject to the exercise of options or warrants) shall be required to enter into an agreement that provides that such stockholders will vote their shares in favor of a Deemed Liquidation Event or transaction in which 50% or more of the voting power of the Company is transferred and which is approved by (i) the Board (if required by law); (ii) the holders of majority of the outstanding shares of Series Seed Preferred Stock, on an as-converted basis; and (iii) the holders of a majority of the outstanding shares of Common Stock (the “Electing Holders”), so long as the liability of each stockholder in such transaction is several (and not joint) and does not exceed the stockholder’s pro rata portion of any claim and the consideration to be paid to the stockholders in such transaction will be allocated as if the consideration were the proceeds to be distributed to the Company’s stockholders in a liquidation under the Company’s then-current Certificate of Incorporation.
Carolina Financial Securities, LLC shall receive both a 5.00% fee for all equity capital raised as well as common equity warrants of the Issuer as compensation for services rendered. The amount of these CFS warrants will equal a number of shares equal to 1.70% of the Series Seed Preferred shares purchased by Investors, for a purchase price of $100 and with an exercise price equal to 1/3 of the price per share of the Series B Preferred shares. CFS may share up to 50% of its fees and warrants with Carofin, LLC, an affiliated Broker-Dealer, for its assistance in the placement of the Offering. All legal fees and out of pocket expenses relating to closing the Offering will be paid by Presidio with CFS expenses subject to the Engagement Agreement between Presidio and CFS.
CFG Financial Services, LLC (“CFG FS”), an affiliate of Carofin and Carolina Financial Securities will act as administrative agent for the Series B Preferred shareholders, often coordinating reporting and other obligations between the Company and the Series B Preferred shareholders. The Company will reimburse CFG FS for its reasonable out of pocket expenses.
AN INVESTMENT IN THE SECURITIES IS SPECULATIVE AND IS SUITABLE ONLY FOR PERSONS OF SUBSTANTIAL FINANCIAL MEANS WHO CAN AFFORD TO LOSE THEIR ENTIRE INVESTMENT AND HAVE NO NEED FOR LIQUIDITY IN THIS INVESTMENT. AN INVESTMENT IN THE SECURITIES OFFERED HEREIN SHOULD NOT BE A MAJOR PART OF YOUR INVESTMENT PORTFOLIO. YOU SHOULD REVIEW THE RISKS OF THIS INVESTMENT WITH YOUR LEGAL OR FINANCIAL ADVISORS.
THIS OFFERING INVOLVES SUBSTANTIAL RISKS. THESE RISKS INCLUDE, BY WAY OF ILLUSTRATION AND NOT LIMITATION, THE FOLLOWING: RISKS ASSOCIATED WITH THE FACT THAT THE MEMBERS WILL NOT HAVE THE RIGHT TO VOTE ON OR APPROVE MOST DECISIONS REGARDING THE BUSINESS AND, AS SUCH, WILL NOT BE IN CONTROL OF THEIR INVESTMENTS IN SECURITIES OF THE COMPANY AND THE BUSINESS; AND THE OPERATION OF THE COMPANY INVOLVES TRANSACTIONS BETWEEN THE COMPANY, THE MANAGER, AND THE OWNER WHICH MAY INVOLVE CONFLICTS OF INTEREST.
THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM, AND WITH THE PRIOR CONSENT OF THE MANAGER, WHICH CONSENT MAY BE WITHHELD IN THE MANAGER’S SOLE DISCRETION. PROSPECTIVE INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
SOME OF THE INFORMATION IN THIS PRESENTATION MAY CONTAIN “FORWARD-LOOKING” STATEMENTS. YOU CAN IDENTIFY SUCH STATEMENTS BY THE USE OF FORWARD-LOOKING WORDS SUCH AS “MAY,” “ANTICIPATE,” “ESTIMATE,” “COULD,” “SHOULD,” “WOULD,” “EXPECT,” “BELIEVE,” “WILL,” “PLAN,” “INTEND,” “PROJECT,” “PREDICT,” “POTENTIAL” OR OTHER SIMILAR WORDS. THESE TYPES OF STATEMENTS DISCUSS FUTURE EXPECTATIONS OR CONTAIN PROJECTIONS OR ESTIMATES WHICH MAY OR MAY NOT HAPPEN AS PROJECTED HEREIN. WHEN CONSIDERING SUCH FORWARD-LOOKING STATEMENTS, YOU SHOULD KEEP IN MIND THE RISK FACTORS LISTED BELOW, WHICH COULD CAUSE THE COMPANY’S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN ANY FORWARD-LOOKING STATEMENT.
YOU SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS IN CONJUNCTION WITH THE OTHER INFORMATION ABOUT THE SECURITIES BEFORE PARTICIPATING IN THIS OFFERING. THE RISKS DISCUSSED IN THIS PRESENTATION CAN ADVERSELY AFFECT THE COMPANY’S OPERATION, OPERATING RESULTS, FINANCIAL CONDITION AND PROSPECTS FOR SUCCESS. THIS COULD CAUSE THE VALUE OF THE SECURITIES OFFERED HEREIN TO DECLINE AND COULD CAUSE YOU TO LOSE PART OR ALL OF YOUR INVESTMENT. THE RISKS AND UNCERTAINTIES DESCRIBED BELOW ARE NOT THE ONLY ONES THE COMPANY FACES BUT DO REPRESENT THOSE RISKS AND UNCERTAINTIES KNOWN TO THE COMPANY AND THAT THE COMPANY BELIEVES ARE MATERIAL TO THE COMPANY’S FUTURE OPERATING PERFORMANCE.
The Securities being offered should be considered a speculative investment. The ability of the Company to achieve its objectives may be determined by factors beyond its control that cannot be predicted at this time. Consequently, there can be no assurance that the Company’s efforts to continue its business operations will prove to be sufficient to enable the Company to generate the funds required to make distributions. Anyone investing in the Securities should do so only if they are financially able to sustain the loss of their entire investment and should recognize that such a possibility exists.
As this security is a private transaction, there is currently no public market for the securities being offered herein. These Securities are not publicly registered securities and will have no secondary sale liquidity.
The Company has a limited history of operations upon which an evaluation of the Company’s business and prospects can be based. No assurances can be given that the Company will ever be profitable or generate revenues sufficient to make distributions. This makes evaluating the Company’s business operations and validating its financial projections difficult. In assessing the Company’s prospects, a potential investor must consider the risks and difficulties frequently encountered by early-stage companies. These risks include the Company’s ability to: raise sufficient capital to fund operations, and other general corporate purposes; manage changing and expanding operations; establish and increase awareness of the Company’s brand and strengthen loyalty among prospective customers; implement and successfully execute the Company’s business and marketing strategies; respond effectively to competitive pressures and developments; continue to enhance the Company’s products and services; and attract, retain and motivate qualified personnel. The Company’s failure in any of these areas could adversely affect the Company’s financial condition and results of operation.
Units may be purchased by the affiliates of the Issuer, or by other persons who will receive fees or other compensation or gain dependent upon the success of the Offering. Such purchases may be made at any time and will be counted in determining whether the Minimum Offering Amount has been met for the First Closing of the Offering. Therefore, Investors should not expect that the sale of sufficient Units to reach the Minimum Offering Amount, indicates that such sales have been made to investors who have no financial or other interest in the Offering, or who otherwise are exercising independent investment discretion.
The sale of the Minimum Offering Amount, while necessary to the business operations of the Issuer, is not designed as a protection to investors, or to indicate that their investment decision is shared by other unaffiliated investors. Because there may be substantial purchases by affiliates of the Issuer, or other persons who will receive fees or other compensation or gain dependent upon the success of the Offering, no individual investor should place any reliance on the sale of the specified minimum as an indication of the merits of the Offering. Each investor must make his own investment decision as to the merits of this Offering.
Any substantial decline in the demand for products sold by the Issuer may cause a decline in the market value of Issuer’s product and negatively impact the Issuer’s financial performance.
Success for the Issuer’s business depends, in part, on the quality and safety of the Issuer’s products. If the products are found to be defective or unsafe, or if they otherwise fail to meet customer standards, relationships with customers could suffer. Further, the Issuer’s reputation could be diminished, and the Issuer could lose sales and/or become subject to liability claims, any of which could result in a material adverse effect on the business.
The Issuer’s activities are subject to international, federal, and state laws. The Issuer’s activities are expected to have a variety of regulatory oversight as development proceeds. Development of any of the Issuer’s operations will be dependent on the Issuer satisfying regulatory guidelines and, where required, being approved by governmental authorities. The Issuer intends to conduct their business activities in a compliant manner and in accordance with all applicable laws but may still be subject to accidents or other unforeseen events which may compromise its performance, and which may have adverse financial implications.
The Company competes with others in the industry. Competitors include companies that may have greater financial and other resources than the Company. Additionally, these competitors could use strategies to prevent the Company from achieving its objectives and may gain market share. This may have a material adverse impact on the financial position of the Company
Any negative changes in economic conditions could have a material adverse effect on the Company's business.
Due to the size of the organization, the Issuer has a significant reliance on certain key employees, particularly Mark Hegedus and Amos Beason. If the Issuer is unable to retain key employees it could jeopardize the Issuer’s ability to implement its business plan, its relationships with its customers, and its financial stability.
The Issuer expects to continue to grow its overall operations, and this may strain the Issuer’s resources. Any inability to manage growth effectively would have a material adverse effect on the Issuer’s business.
The Issuer reserves the right to accept or reject any proposed investment at its sole discretion. Subject to this discretion, it intends to accept investments on a “first-come, first-served” basis, with the consequence that Investors will be allocated a portion of the total Offering, based upon the amounts they have committed, in the order in which such commitments have been accepted. The Borrower is not required to accept all commitments tendered to it. There is no assurance, therefore, that your commitment will necessarily be accepted in whole or in part by it should it raise more or less funds than are needed to make its investments.
The financial projections contained in this Offering Summary and any supplements represent the Issuer’s estimated results of operations. The financial projections have been prepared upon the basis of assumptions and estimates which may differ from actual events and/or circumstances.
The Company has not requested and will not request any tax ruling from the IRS regarding the tax consequences of the Company’s activities. Accordingly, there is no certainty as to the tax consequences of participating in the Security. The Company has not sought or obtained a legal opinion with respect to the tax treatment of the offering proceeds or issuance of the Security. Accordingly, Investors are urged to consult your own tax advisor with respect to the federal and state tax consequences arising from participation in this Offering.
There is a possibility that the IRS will audit the Company’s income tax returns. If the Company’s income tax returns are audited, your return might also be audited.
No assurance can be given that the current Congress or any future Congress will not enact federal income tax legislation that could adversely affect the tax consequences of participating in the Offering.
Potential investors should not rely exclusively on one aspect of the security structure when making an investment decision on whether to participate in this Offering.
In addition to the above risks, businesses are often subject to risks not foreseen or fully appreciated by management. Prospective investors reviewing this Offering Summary should keep in mind other possible risks that could be important to the success of their investment in the Securities.
These securities have not been registered with the Securities and Exchange Commission (the “SEC” or the “Commission”), or with any state securities commission or any other regulatory authority. The securities are being offered in reliance upon an exemption from the registration requirement of federal and state securities laws and cannot be resold unless the securities are subsequently registered under such laws or unless an exemption from registration is available. Neither the SEC nor any other agency has passed on, recommended or endorsed the merits of this offering (this “Offering”) or the accuracy or adequacy of these confidential offering documents (the “Offering Package”). Any representation to the contrary is unlawful.
These securities are offered through Carofin, LLC, Member of FINRA/SIPC. Carolina Financial Securities is an affiliate of Carofin and both Broker-Dealers are affiliates of Carolina Financial Group, LLC. Documents have been prepared by Carolina Financial Securities and have been reviewed and approved by the management of the Company. The information contained herein has not been independently verified and is dependent on information provided by the Company to Carolina Financial Securities, LLC.
The information contained herein is for informational purposes only and is not intended for further distribution. The information does not constitute a complete description of any investment or investment performance. This document is in no way a solicitation nor is it an offer to sell securities nor is it advice or recommendation regarding any investment. The information is not directed to any person who is not believed to qualify under the definition of an Accredited Investor under the rules of Regulation D of the 1933 Securities and Exchange Act. No security listed in this document or otherwise offered through Carolina Financial Securities, LLC or Carofin, LLC may be purchased without prior receipt of a complete Private Placement Memorandum or other official offer to sell.
Due diligence materials related to this Borrower and the Offering are available to you through Carolina Financial Securities’ affiliated marketplace, Carofin. If you have not received your login information to access Carofin.com, please contact your company representative to have access granted.
The Company will not offer, sell or issue any Securities in any jurisdiction where it is unlawful to do so or where laws, rules, regulations or orders would require the Company, in its sole discretion, to incur costs, obligations or time delays disproportionate to the net proceeds the Company will realize from such offers, sales or issuances. Neither this Offering Package nor any subscription agreement shall constitute an offer to sell or a solicitation of an offer to purchase any Securities in any jurisdiction in which such transactions would be unlawful.
Private placements are high risk and illiquid investments. As with other investments, you can lose some or all of your investment. Nothing in this document should be interpreted to state or imply that past results indicate future performance, nor should it be interpreted that FINRA, the SEC or any other securities regulator approves of any of these securities. Additionally, there are no warranties expressed or implied as to accuracy, completeness, or results obtained from any information provided in this document. Investing in private securities transactions bears risk, in part due to the following factors: there is no secondary market for the securities; there is credit risk; where there is collateral as security for the investment, its value may be imped if it is sold. Please see the Private Placement Memorandum (PPM), and the complete list of contents of this Offering Package for a more detailed explanation of the securities Summary of Terms, Investor Suitability Standards, Confidentiality, Securities Matters and Risk Factors.
Caution Regarding Forward-Looking Statements
Certain statements in this Summary Offering Material may be “Forward-looking” in that they do not discuss historical facts but instead note future expectations, projections, intentions, or other items relating to the future. We caution you to be aware of the speculative nature of forward-looking statements as these statements are not guarantees of performance or results.
Forward-looking statements, which are generally prefaced by the words “may,” “anticipate,” “estimate,” “could,” “should,” “would,” “expect,” “believe,” “will,” “plan,” “project,” “intend,” and similar terms, are subject to known and unknown risks, uncertainties and other facts that may cause our actual results or performance to differ materially from those contemplated by the forward-looking statements. Although these forward-looking statements reflect our good faith belief based on current expectations, estimates and projections about, among other things, the industry and the markets in which we operate, they are not guarantees of future performance. Whether actual results will conform to our expectations and predictions is subject to several known and unknown risks and uncertainties, including risks and uncertainties discussed in this Summary Offering Material.
Consequently, all the forward-looking statements made in this Summary Offering Material are qualified by these cautionary statements and there can be no assurance that the actual results anticipated by us will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, us or our business or operations. Risks, uncertainties, and factors that could cause actual results to differ materially from those projected are discussed in the “Risk Factors” section of this Summary Offering Material. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Considering these risks, uncertainties, and assumptions, the forward-looking events discussed in the Summary Offering Material might not occur.
State Securities Laws:
The Company will not offer, sell or issue any securities in any jurisdiction where it is unlawful to do so or where laws, rules, regulations or orders would require the Company, in its sole discretion, to incur costs, obligations or time delays disproportionate to the net proceeds the Company will realize from such offers, sales or issuances. Neither this Offering Package nor any subscription agreement shall constitute an offer to sell or a solicitation of an offer to purchase any securities in any jurisdiction in which such transactions would be unlawful.
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