Step 1 – Review Offering Document
Please review the Offering Document in its entirety and complete the acknowledgement at the bottom of this page to continue.
OFFERING DOCUMENT
No securities regulatory authority or regulator has assessed, reviewed or approved the merits of these securities or reviewed this offering document. Any representation to the contrary is an offence. This is a risky investment.
The forecasts and predictions of an early-stage business are difficult to objectively analyze or confirm. Forward-looking statements represent the opinion of the issuer only and may not prove to be reasonable.
THE ISSUER
Full legal name: Fintechwerx International Software Solutions Inc.
Head office address: 1275 W 6th Avenue, Suite 300, Vancouver, BC, V6H 1A6
Telephone: (778) 652-3669
Email address: [email protected]
Website URL: www.fintechwerx.com
Contact Person
Full legal name: Francisco Kent Carasquero
Position held with the issuer: Executive Chair and Director
Business address: 1275 W 6th Avenue, Suite 300, Vancouver, BC, V6H 1A6
Business telephone: (778) 652-3669
Email address: [email protected]
ISSUER’S BUSINESS
Description:
The Issuer is an ecommerce technology company.
The Issuer has developed an identity verification, payments, and data management platform,
(the “Platform”).
Does or will the Issuer build, design or develop something? Will it sell something produced by others? Will it provide a service?
The Platform is built on licensed and proprietary software (the "Technology Stack"). The platform builds on its proprietary data model, using APIs to deliver identity verification of businesses, independent sales organizations, and consumers. The APIs automate integrations to ecommerce payment experiences, including the shopping cart, payment processing, payment gateways and Interac e-Transfer reconciliations. (the “Platform Services”).
The Issuer will sell the Platform Services and continue to build out new technologies that complement the Platform.
What are the key details about the Issuer’s industry and operations? What makes the Issuer’s business special and different from other competitors in the industry?
Global annual online sales are expected to grow from $3.3T to $5.4T by 2026 (Morgan Stanley, 2022). Within this multi-trillion-dollar market, there are many underserved businesses operating in industries that need trusted payment processing solutions. These industries require trusted solutions within their product/service segments in order to meet identity verified user regulations in key countries where these merchants, or their clients, reside. This need is further expressed in the expected 16.35% CAGR of the global identity verification market between 2020-2030 to a value of USD $32.94B according to Straits Research.
In Canada, Rotman Business School notes how a key obstacle to Canadian digital payments is the lack of a Digital ID, where digital ID is common in a growing number of EU member countries.
The most recent attempt to address this $32B/year payment system inefficiency in Canada is Verified.Me, which uses blockchain technology to act as an intermediary between applications/services that require secure identification. This service satisfies most large enterprises. It did not include small and medium-sized enterprises (SMEs) in the development process leaving them out of the system post-implementation.
The Issuer helps SMEs evolve and capture this new market requirement with ease, velocity and reliability. This ensures retailers in the entry and mid-market are supported with a full-stack Platform-as-a-Service. The Issuer has built a SME and user-centric solution for on-boarding and qualifying consumers using platform agnostic services for identity verification and transaction processing. This offers SMEs access to the same capabilities as the enterprise market.
With the Issuer’s solution, SMEs can depend on a much more approachable solution for sourcing, implementing, maintaining and transacting in markets that require increasingly greater levels of compliance and transaction integrity, opening up opportunities to capture revenue opportunities previously outside of their reach.
What milestones has the Issuer already reached and what do they hope to achieve in the next 2 years? E.g., Complete testing, find a manufacturer, commence a marketing campaign or buy inventory. What is the proposed timeline for achieving each of the milestones?
The Issuer has developed a data model and through its wholly owned subsidiary has entered into two license agreements, launched a marketing campaign and entered into negotiations for a license with a payment gateway.
- The data model is the framework under which the Technology Stack is built and operated. It is a visualisation that allows the connection of a distributed micro services deployment to the Issuers requirements and processes. By implementing a common data model for business activities, a rigour is applied to data events while allowing the flexibility to adapt to distinct client or market segment opportunities.
- The first license gives the Issuer the right to market and distribute software that automates and reports reconciliation of email money transfer records (the “EMT Plug-In”)
- The second license gives the Issuer the right to market and distribute software that automates onboarding, and reports business, independent sales organisation, and consumer payment service applications, payment gateway integration, payment processor integration (the “Enrollment software”)
- The Issuer has launched an e-commerce store at www.emtwerx.com where the EMT Plug-In is sold.
- The Issuer has launched a strategic digital marketing campaign (the "Campaign") to build brand recognition and awareness and sell the Platform Services. The Issuer’s objectives for the Campaign are as follows:
- Build brand recognition and awareness for the Issuer and gain access to new market participants, including potential customers, vendors and partners (the "Market Participants").
- Build an online audience of Market Participants that can be carried beyond the Campaign.
- Generate strategic and tactical press and social media coverage for the Issuer.
The Issuer has entered into negotiations for a payment gateway license which proposes to give the Issuer the right to market and distribute the payment gateway services. The Issuer expects to complete negotiations in the second quarter of 2023.
The Issuer intends to further develop the Platform by continually innovating and licensing technologies.
What are the major hurdles that the Issuer expects to face in achieving its milestones?
Money Transmission Licensing and Regulation
In Canada, the PCMLTFA implements specific measures to detect and deter money laundering and the financing of terrorist activities, including by establishing record keeping and client identification requirements and requiring the reporting of suspicious financial transactions and of cross-border movements of currency and monetary instruments. MSBs are reporting entities under the PCMLTFA and must register with the Financial Transactions and Reports Analysis Centre of Canada. The Province of Québec has also enacted legislation requiring similar registration with the AMF.
The Issuers current activities do not require registration with the Financial Crimes Enforcement Network of the U.S. Department of the Treasury or the Financial Transactions and Reports Analysis Centre of Canada as an MSB or to be licensed as a money transmitter with U.S. states or Canadian provinces.
In the United States, regulations promulgated by the Financial Crimes Enforcement Network of the U.S. Department of the Treasury require certain persons to register at the federal level as a MSB and comply with anti-money laundering laws and regulations. In addition, most U.S. states require licenses for persons engaged in the business of money transmission. Such U.S. state licensing laws may subject money transmitters to periodic examinations and may require them and their agents to comply with federal and/or state anti-money laundering laws and regulations.
As the Issuers business continues to grow and evolve, however, the Issuer may become subject to such regulation in the future.
Additional risks include but are not limited to:
The substantial capital requirement of the Issuer and ability to maintain adequate capital resources to carry out its business activities, revenue risks from the sale of its various technologies, Industry competition, limitations on insurance risk, fluctuations in global currencies and marketability of software technologies, the Issuer’s title and interest to its license agreement may be subject to challenge, funds may not be available to the Issuer on terms acceptable to the Issuer or at all, financing risks and dilution to shareholders resulting from future financing activities; reliance on management and dependence on key personnel, conflicts of interest, and general market and industry conditions.
How are the funds raised from this financing expected to help the Issuer advance its business and achieve one or more of the milestones?
The funds raised by the Issuer will assist the Issuer with continued development and marketing of the Platform.
Has the Issuer entered any contracts that are important to its business?
The Issuer through its wholly owned subsidiary has entered into a license for the marketing and distribution of software that automates the reconciliation of email money transfer records (the” EMT Plug-In”).
The Issuer through its wholly owned subsidiary has entered into a license for the marketing and distribution of software that automates and reports business, independent sales organisation, and consumer payment service applications, payment gateway integration, payment processor integration (the “Enrollment Software”)
Has the Issuer conducted any operations yet?
The Issuer through its wholly owned subsidiary has launched an e-commerce store at www.emtwerx.com where the EMT Plug-In is sold.
The Issuer through its wholly owned subsidiary has launched a strategic digital marketing campaign (the "Campaign") to build brand recognition and awareness of the EMT Plug-in and Platform Services.
Where does the Issuer see its business in 3, 5 and 10 years?
The Issuer intends to further develop the Platform by continually innovating and licensing technology. The technology will complement current offerings with a view to optimization and automation that enables merchants, Independent sales organizations and consumers to seamlessly transact in online commerce.
What are the Issuer’s future plans and hopes for its business and how does it plan to get there?
The Issuer intends to further develop the Platform by continually innovating and licensing technologies. The technology will complement current offerings with a view to optimization and automation that enables merchants, independent sales organizations and consumers to seamlessly transact in online commerce.
What is the Issuer’s management experience in running a business or in the same industry?
The Issuer’s management has 10 years of experience in the industry.
Does the issuer have business premises from which it can operate its business?
Yes.
How many employees does the issuer have? How many does it need?
The Issuer does not have any employees. All services are provided by directors, officers and consultants.
Indicate whether the issuer is a corporation, a limited partnership, a general partnership, an association (as defined under the Instrument) or other.
Corporation.
Indicate the province, territory, or state where the issuer is incorporated or organized.
British Columbia
Indicate where the issuer’s articles of incorporation, limited partnership agreement, shareholder agreement or similar document is available for purchasers to review:
71275 W 6th Avenue, Suite 300, Vancouver, BC, V6H 1A6
Indicate which statement(s) best describe(s) the issuer’s operations (select all that apply) The issuer:
☐ has never conducted operations
☐ is in the development stage
☒ is currently conducting operations
☐ Financial statements available
Describe the number and type of securities of the issuer outstanding as at the date of the offering document. If there are securities outstanding other than the eligible securities being offered, describe those securities:
Common Shares – 6,000,000 Special Warrants – 13,135,000
MANAGEMENT
Full legal name: Francisco Kent Carasquero
Municipality of Residence: South Surrey, BC
Position at Issuer: Executive Chair and Director
Principal occupation for the last 5 years: Director and President of CPT Secure Inc.
Expertise, education, and experience that is relevant to the issuer’s business:
Education:
January 1994
Bachelor of Arts – Economics
University of Manitoba
June1994
Canadian Securities Course
Canadian Securities Institute
September 2019
PBCO200-VA11971 Public Companies: Financing, Governance and Compliance
Simon Fraser University
A course designed for directors, officers, and advisors of public companies.
November 2020
The Business of Payments Program
Simon Fraser University
Beedie School of Business – Executive Education
For twenty-five years Kent has been providing strategic corporate and compliance services to publicly and privately held early-stage corporations. Kent has extensive experience in structuring the acquisition and sale of business operations, strategic business alliances, mergers and acquisitions. Since 2010, Kent has been immersed in the financial technology industry.
Number and type of securities of the issuer owned:
Common Shares – $0.005 – 900,000, Special Warrants – $0.02 – 375,000, Special Warrants – $0.05 – 150,000
Date securities were acquired, and price paid for the securities:
Nov 25th – $0.005, Jan 20th – $0.02, Feb 28th – $0.05
Percentage of the issuer’s securities held as of the date of this offering document:
Common Shares – 15%, Special Warrants – 4%
A. Has ever pleaded guilty to or been found guilty of:
☐ a summary conviction or indictable offence under the Criminal Code,
☐ a quasi-criminal offence in any jurisdiction of Canada or a foreign jurisdiction,
☐ a misdemeanor or felony under the criminal legislation of the United States of America, or any state territory therein
☐ an offence under the criminal legislation of any other foreign jurisdiction,
B. Is or has been the subject of an order (cease trade or otherwise), judgment, decree, sanction, or administrative penalty imposed by, or has entered into a settlement agreement with, a government agency, administrative agency, self-regulatory organization, civil court, or administrative court of Canada or a foreign jurisdiction in the last 10 years related to:
☐ the person’s involvement in any securities, insurance or banking activity,
☐ a claim based in whole or in part on fraud, theft, deceit, misrepresentation, conspiracy, breach of trust,
☐ breach of fiduciary duty, insider trading, unregistered trading, illegal distributions, failure to disclose material facts or changes, or allegations of similar conduct,
☐ C. Is or has been the subject of an order, judgment, decree, sanction or administrative penalty imposed by a discipline committee, professional order or administrative court of Canada or a foreign jurisdiction in the last ten years related to any professional misconduct:
☐ D. is or has ever been the subject of a bankruptcy or insolvency proceeding, or
☐ E. is a director, officer, founder or control person of a person or company that is or has been subject to a proceeding described in paragraph (a), (b), (c) or (d) above.
CROWDFUNDING DISTRIBUTION
Provide the name of the funding portal the issuer is using to conduct its crowdfunding distribution.
Launch Crowdfunding Corp.
Indicate all the jurisdictions (Canadian provinces and territories) where the issuer intends to raise funds and make this offering document available.
Alberta, British Columbia and Ontario
The date before which the issuer must have raised the minimum offering amount for the closing of the distribution (no later than 90 days after the date this offering document is first made available on the funding portal);
90 days after the date of this offering document
TYPE OF SECURITY BEING ISSUED
Securities offered: Special Warrants
The securities offered have the following rights, restrictions and conditions:
☒ Voting rights: The Special Warrants do not carry the right to vote. However, each common share issuable upon conversion of the Special Warrants entitles the holder to notice of, and to attend and vote at, each meeting of shareholders on the basis of one vote for each common share held.
☒ Dividends: Holders of Special Warrants are not entitled to receive dividends. Dividends may be paid on common shares from available net income if and when declared by the directors of the Issuer.
☒ Rights on dissolution: Holders of Special Warrants are not entitled to participate in the allocation and distribution of assets upon the dissolution or liquidation of the Issuer. All common shares entitle the holders to participate rateably in the allocation and distribution of assets upon the dissolution or liquidation of the Issuer.
☒ Conversion rights: The Special Warrants automatically convert into common shares of the Issuer on a one to one basis (i) at any time, at the discretion of the Issuer or (ii) upon the issuance by a Canadian securities regulatory authority of a receipt for a final prospectus qualifying the issuance of the common shares upon conversion of the special warrants. Investors are advised to consult their own legal advisors in this regard.
☐ Tag-along rights: N/A
☐ Drag-along rights: N/A
☐ Pre-emptive rights: N/A
☐ Other: N/A
Summary of any other material restrictions or conditions that attach to the eligible securities being offered, such as tag-along, drag along or pre-emptive rights:
N/A
OFFERING DETAILS
|
|
Total amount ($) |
Total number of securities issuable |
|
Minimum offering amount |
$5,000 |
100,000 |
|
Maximum offering amount |
$50,000 |
500,000 |
|
Price per security |
$0.05 |
|
Minimum investment amount per purchaser: $50.00
Note: The minimum offering amount stated in this offering document may be satisfied with funds that are unconditionally available to Fintechwerx International Software Solutions Inc. that are raised using other prospectus exemptions.
USE OF FUNDS
Information on the funds previously raised by the issuer:
The amount of funds previously raised:
$405,000
How the issuer raised those funds:
Private Placements Financings
If the funds were raised by issuing securities, the prospectus exemption that the issuer relied on to issue those securities:
Section 2.4 (Private Issuer) of National Instrument 45-106 Prospectus Exemptions
How the issuer used those funds:
General and administrative expenses.
Information about funds that will be raised from this crowdfunding distribution:
|
Intended use of funds in order of priority |
Assuming minimum offering amount |
Assuming maximum offering amount |
|
General Working Capital
|
$500 |
$45,500 |
|
Portal Fees
|
$4,500 |
$4,500 |
|
Total
|
$5,000 |
$50,000 |
PREVIOUS CROWDFUNDING DISTRIBUTIONS
For each crowdfunding distribution in which the issuer group and each founder, director, officer, and control person of the issuer group have been involved in the past five years, provide the following information:
The full legal name of the issuer that made the distribution:
N/A
The name of the funding portal:
N/A
Whether the distribution successfully closed, was withdrawn by the issuer or did not close because the minimum offering amount was not reached, and the date on which any of these occurred:
N/A
COMPENSATION PAID TO FUNDING PORTAL
Commission, fee or other amount expected to be paid by the issuer to the funding portal for this crowdfunding distribution and the estimated amount to be paid:
It is anticipated that Launch Crowdfunding Corp. will be paid a $4,500 + tax flat fee (due only if campaign meets minimum investment amount) and will be issued 300,000 Special Warrants for facilitating the crowdfunding campaign.
RISK FACTORS
Describe in order of importance, starting with the most important, the risk factors material to the issuer that a reasonable investor would consider important in deciding whether to buy the issuer’s securities.
Investment in the Special Warrants is highly speculative given the proposed nature of the Issuer’s business and its present stage of development. The following are risk factors associated with the Issuer, but are not intended to be all inclusive:
(a) The Issuer was only recently incorporated, has not commenced commercial operations, and has no assets other than cash. It has no history of earnings and will not generate earnings or pay dividends in the near future.
(b) Investment in the Special Warrants is highly speculative given the proposed nature of the Issuer’s business and its present stage of development.
(c) The directors and officers of the Issuer will only devote a portion of their time to the business and affairs of the Issuer and some of them are or will be engaged in other projects or businesses such that conflicts of interest may arise from time to time.
(d) There can be no assurance that the Issuer will be successful in filing a prospectus, in which case the Special Warrants will have no economic value. The Special Warrants are subject to an indefinite hold period and the investor may have no ability to sell its Special Warrants.
(e) If the Special Warrants are converted to common shares, there can be no assurance that an active and liquid market for the Issuer’s common shares will develop and an investor may find it difficult to resell its common shares.
(f) Any transaction may be financed in all or part by the issuance of additional securities by the Issuer and this may result in dilution to the investor, which dilution may be significant and which may also result in a change of control of the Issuer.
As a result of these factors, an investment in the Special Warrants is only suitable for those investors who are willing to rely solely on the management of the Issuer and who can afford to lose their entire investment. Those investors who are not prepared to do so should not invest in the Special Warrants.
We do not currently have the financial resources to pay [interest, dividends or distributions] to investors. There is no assurance that we will ever have the financial resources to do so.
REPORTING OBLIGATIONS
Nature and frequency of any disclosure of information the issuer intends to provide to purchasers after the closing of the distribution and explain how purchasers can access this information:
The Issuer does not anticipate providing purchasers with any additional disclosure, except as may be required under applicable laws.
If the issuer is required by corporate legislation, its constating documents (e.g., articles of incorporation or by-laws) or otherwise to provide annual financial statements or an information circular/proxy statements to its security holders, state that fact.
As a company formed under the Business Corporations Act (British Columbia) (the “Act”), unless relieved under section 200 of the Act from their obligation to do so, the directors of the Company must, on or before each annual reference date, produce and publish financial statements in respect of the latest completed financial year of the Company.
A British Columbia company must also, subject to subsections 182(2) to (5) of the Act, which allows shareholders to pass consent resolutions in lieu of and defer the holding of a company’s annual general meeting, hold an annual general meeting:
(a) for the first time, no more than 18 months after the date on which it was recognized; and
(b) after its first annual reference date, at least once in each calendar year and not more than 15 months after the annual reference date for the preceding calendar year (s. 182(1)).
The holding of an annual general meeting sets the “annual reference date” for that annual reference period. The next day is the first day of the next annual reference period for the company.
If the issuer is aware, after making reasonable inquiries, of any existing voting trust agreement among certain shareholders of the issuer, provide the information:
The number of shareholders party to the agreement: N/A
The percentage of voting shares of the issuer subject to the agreement: N/A
The name of the person acting as a trustee: N/A
Whether the trustee has been granted any additional powers: N/A
Whether the agreement is limited to a specified period of time: N/A
RESALE RESTRICTIONS
“The securities you are purchasing are subject to a resale restriction. You might never be able to resell the securities.”
PURCHASERS’ RIGHTS
For your information, the purchasers have the following rights, which will be included in the Offering Document posted on the Launch Portal:
Rights of Action in the Event of a Misrepresentation
If there is a misrepresentation in this offering document, you have a right:
- to cancel your agreement with Fintechwerx International Software Solutions Inc. to buy these securities, or
- to damages against Fintechwerx International Software Solutions Inc. and may, in certain jurisdictions, have the statutory right to damages from other persons.
These rights are available to you whether or not you relied on the misrepresentation. However, there are various circumstances that limit your rights. In particular, your rights might be limited if you knew of the misrepresentation when you purchased the securities.
If you intend to rely on the rights described in paragraph (a) or (b) above, you must do so within strict time limitations.
Two-day cancellation right:
“You may cancel your agreement to purchase these securities. To do so, you must send a notice to the funding portal not later than midnight on the second business day after you enter into the agreement. If there is an amendment to this offering document, you can cancel your agreement to purchase these securities by sending a notice to the funding portal not later than midnight on the second business day after the funding portal provides you notice of the amendment.”
DATE AND CERTIFICATE
Signed By: Francisco Kent Carasquero
Position: Executive Chair and Director
Date: March 15, 2023