Coming Soon.

Q&A

Since launching our capital campaign to raise funds to open Jam, a community owned café in Buffalo’s Parkside neighborhood, we’ve gotten a lot of interest -and a lot of questions- from folks around town. To get right into the specifics of it all, our capital campaign will rely on an intrastate offering exemption for the sale of securities in New York to bona-fide New York State residents only (including you, hopefully!). Additional information can be found below. 

Question: What is an intrastate offering?
Answer: An intrastate offering is the sale of an ownership interest in a company within New York State. In this case it is the sale of shares. By only offering the shares to New York residents, we are permitted to sell to general members of the community as long as we comply with New York law.

Question: Why only New York State residents?
Answer: If shares are offered to residents of other states (or countries) we would no longer be able to rely on the intrastate offering exemption. This means we would have to register with the United State Securities and Exchange Commission (SEC) and would likely mean that we would not be easily able to offer shares to general members of the community.

Question: What does “Series A Preferred Share” mean?
Answer: The Company has both preferred and common shares. The designation of “Preferred” means that the shares have some sort of economic right or privilege over the common shares. Here, there is a protection clause in the certificate as well as a liquidation preference. The liquidation preference means that upon the sale or liquidation of the business or its assets, the preferred shareholders would receive a return of their capital prior to any distributions to the common shareholders. The term “Series A” refers to the order in the series of shares sold (i.e., Series A, Series B, Series C). Since these are the first shares offered for sale by the Company, they were given the designation of “Series A”.

Question: Why $1 per share?
Answer: We wanted to make things easy for people. $1 per share makes math easy! Shares of Series A Preferred shares will be sold at $1 per share according to the terms of the prospectus, with a minimum purchase of 100 shares per investor.

Question: Why $100 minimum purchase?
Answer:  We arbitrarily set a minimum so as to encourage a reasonable investment level and manage just how many shareholders the Company ended up with. $100,000 at a $1 per share could theoretically end up with 100,000 investors. That many investors would create regulatory and practical challenges for the company.

Question: Can I buy more than $100 in shares? If so, in what increments?
Answer: Yes! $100 in shares is the minimum. There is also a maximum of $15,000 in shares. Between 100 and 15,000 you can purchase any number of shares (i.e., 101; 557; 6,701; 14,999). The Company aims to raise a minimum of $50,000 and a maximum of $200,000 under the offering.

Question: Why the $50,000 to $200,000 goal?
Answer: $50,000 is the minimum amount we have determined necessary to complete the necessary renovations and purchase equipment to open. $200,000 was arbitrarily set as a maximum. If we reach the maximum it will allow for additional operating capital, marketing expenditures and reserves.

Question: What is the timeline to raise this goal?
Answer: The offering expires in January unless amended. Our goal is to open as soon as possible!

Question:  What happens if the goal is not reached?
Answer:  If we do not reach the minimum of $50,000 the funds received will be returned to prospective shareholders and the board of directors will determine what the next course of action is. The offering could be amended to lower the minimum but additional capital would be still be needed to complete the project.

Question: What happens if the business does not succeed?
Answer: If the business does not succeed then the board of directors would have to determine a course of action forward. This could include, but is not limited to, raising additional capital, restructuring the business, selling the business, liquidating assets, filing for protection under bankruptcy laws, and/or winding the company up and distributing available capital to shareholders.

Question: What exactly is the process to buy shares?
Answer: If you are a bona-fide New York State resident, and are interested in learning more, let us know by emailing investors@jamparkside.com. Once we’ve heard from you, we’ll send over a questionnaire that must be completed in order for us to share our prospectus with you. Once you review the prospectus you may, if you choose to, sign and return a subscription agreement for the number of shares you wish to purchase along with the payment for the shares. Thereafter the company will periodically (as determined by the board of directors) conduct a “closing” and issues you a certificate representing your shares.

Question: What do investors get by buying shares?
Answer: Investors will receive Series A Preferred Shares. This means that you will be an owner of the company. You will be entitled to a percentage of any profits distributed (if any) as determined by the board on a pro rata basis. You will also receive a liquidation preference (as detailed in the Offering Prospectus).

Question:  What is the purpose of the Benefit Corp model?
Answer: A benefit corporation allows the Company to take into account the benefit of a specific purpose (in this case the community, social and economic benefit of Parkside and its surrounding neighborhoods) when making decisions. Each year the Company must take some action to further its specific purpose. Those actions are then detailed in an annual report submitted to shareholders.

Question: How will the benefit be determined each year?
Answer:  This will be determined by the Board of Directors of the Company.

Question: Are there any local examples of Benefit Corps?
Answer: 19 Ideas (https://19ideas.com/), a local public relations firm is a benefit corporation. This year Business First honored them with WNY’s fastest growing company award.

Question:  What is the community business model?
Answer: Community ownership of businesses is rare in Western New York, but it is common in Great Britain and places where it has been difficult for independent businesses to succeed. The business model offers a form of business that engages large numbers of the community to stimulate social activity and community cohesion. The idea is for the community owned business to become a hub for their community. For more information on UK community businesses please see http://www.powertochange.org.uk/wp-content/uploads/2017/07/Plunkett_BetterBusiness_Shops_final.pdf

Question:  Are there any local examples of Community ownership of business?
Answer:  One such example is the Community Store in Saranac Lake—a small village in the Adirondack mountains in New York with approximately 5,000 people. After a local Ames department store closed in 2002, the town was left worrying whether a proposed Wal-Mart store would harm the village’s local proprietors and charm. With the closest department store 40 minutes away, residents decided they would take matters into their own hands—“an investment in the community as well as the store,” remarked Melinda Little in a New York Times article.  The Saranac Lake Community Store ultimately raised $500,000 from 600 investors at an average of $800 each. In 2011 after substantial renovations, the store opened, and continues to serve the community to this day.

Question: Why the legal mumbo jumbo from the State Attorney General?
Answer: New York law requires us to! So with that said, we are required to place the following on most advertisements: “The Attorney General of the State of New York has not passed on or endorsed the merits of the offering. Any representation to the contrary is unlawful. Offered by prospectus only to residents of New York State. NY I 17- 9969.”

***Disclaimer*** And now for some more legal mumbo jumbo that our attorney insisted upon! This does FAQ is only meant to supplement the Offering Prospectus and answer some of the common questions we receive from prospective investors. Those interested in purchasing shares should consult with their own attorneys and investment professionals when making decisions. This FAQ does not constitute legal or financial advice and should not be considered without carefully reviewing the Offering Prospectus first.