Eventus Capital Corp.
Relationship and Conflict of Interest Disclosure Statement
Eventus Capital Corp. (“Eventus”) is registered under the securities laws of Alberta, British Columbia, Ontario and Quebec as an exempt market dealer. Under applicable securities laws, exempt market dealers are obliged to deliver to their clients certain information relating to the client’s relationship with the dealer. We are making these disclosures to you because you are a prospective investor (“Investor”) in securities (the “Securities”) issued in an offering or private placement (an “Offering”) in which Eventus has, or may have, a role as an investment dealer.
We interact with potential Investors on a transaction by transaction basis, and do not maintain trading, cash, margin, or similar accounts for Investors. Eventus does not accept delivery of cheques or cash from or at the direction of Investors payable to Eventus, its affiliates or employees. In addition, any contract you enter to acquire the securities will be pursuant to a subscription agreement entered with the corporate issuer. As an exempt market dealer, however, we are required to make certain disclosures to Investors, such as those set out in this Relationship and Conflict of Interest Disclosure Statement, and to obtain certain information in respect of Investors, as described below under KYC Suitability Obligations.
Eventus is engaged in the business of fundraising for public and private corporate issuers (“Issuers”), trading in primary or secondary distributions of securities that are being sold pursuant to a prospectus exemption (the “Exempt Market”). Eventus also provides certain M&A, research, consulting and other advisory services to Issuers.
Risks to Consider in Making an Investment Decision
Investing in the Exempt Market is inherently risky, involving highly volatile, highly speculative securities with significant risk of loss of capital. This risk is heightened for early stage ventures. The lack of disclosure and statutory protection of a prospectus; enhanced business risk; political risk; currency risk; tax risk; liquidity risk; and market risk are examples of risks that must all be taken into consideration. Investors should proceed on the assumption that they may be required to bear the economic risks of the investment for an indefinite period for a number of reasons, including indefinite restrictions on transferability and/or limited and sporadic trading volume.
These securities are suitable as an investment only for investors able and willing to withstand loss of their entire investment.
Identifying and addressing material Conflicts of Interest
A “conflict of interest” generally may arise where the interests of different parties, such as the interests of a client and those of Eventus or any of its employees are inconsistent or divergent. Generally, the conflict of interest is considered material if the conflict may be reasonably expected to influence either a client’s decisions or Eventus representatives’ recommendations in the circumstances.
In general, we manage and address relevant conflicts of interest between clients and our firm, through one or more of the following:
Clear disclosure of identified conflicts of interest so that the client can make a fully informed decision to best meet their interests.
Procedures to manage any potential conflicts through the effective application of our written internal controls.
Removal altogether of the source of the conflict if controls and disclosure are not adequate, possibly resulting in adverse effects.
Exempt market dealers are required to identify and disclose certain conflicts of interest. In that regard, we have identified the following:
(a) We will receive a commission from the Issuer upon successful completion of the Offering.
(b) Our directors, officers, and employees may invest alongside you in the Offering, and/or may have invested in an early round of financing by the Issuer.
(c) Eventus Capital is a related registrant of Lynwood Capital Management Inc. (together with funds it manages, “Lynwood”). Lynwood may participate in private placements where Eventus Capital is acting as a finder or an agent to the Issuer.
Disclosure of Costs, Charges and Compensation
Investors directly pay the Issuer the subscription price for securities set forth in the subscription agreement for the Offering. We do not charge fees or commissions to Investors. Instead we earn commissions paid by Issuers, as noted above.
KYC Suitability Obligations
As an exempt market dealer, we have an obligation to you to assess whether a purchase or sale of a security is suitable for you prior to making a recommendation to or accepting instructions from you. To meet this suitability obligation, we collect information (referred to as know-your-client or “KYC” information) from you at the time you open an account with us and we update this information on a periodic basis. Your KYC information is about you, your personal circumstances and current financial situation, and includes your (a) age; (b) annual Income; (c) net worth; (d) investment knowledge and experience; (e) investment objectives (f) investment time horizon and (g) risk tolerance.
Securities regulations oblige us to advise you that, if you are considering borrowing money to purchase securities, the use of borrowed money involves greater risk than a purchase using cash resources only. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remains the same even if the value of the securities purchased declines.
Your Eventus advisor can answer questions and provide more information related to specific conflicts. If you have any questions or concerns, whether they involve relationship, conflicts of interest or any other matter, please do not hesitate to raise those matters with us for more information.