These terms apply to any engagement between Crowdcube Capital Limited ("Crowdcube") of South Entrance, Fourth Floor, Broadwalk House, Southernhay, Exeter, EX1 1TS, with Company No. 09095835, authorised and regulated by the Financial Conduct Authority (the "FCA") (No. 650205) and any investee company (the "Investee") seeking to use Crowdcube in accessing and arranging share subscriptions with potential investors who are members of Crowdcube (the "Investors") through the Crowdcube website, mobile website or mobile application (the "Website").
1. INVESTEE'S OBLIGATIONS
1.1. The Investee shall and agrees to:
1.1.1. Complete an application form to participate in Crowdcube funding in terms satisfactory to Crowdcube, such form to include the following prescribed information in all cases:
126.96.36.199.The Investee’s company name;
188.8.131.52. The Investee’s company number;
184.108.40.206. The Investee’s registered office and trading address(es);
220.127.116.11. A complete list of all the Investee’s officers (directors, secretary and accountant/auditor);
18.104.22.168. A complete share capital table on a fully diluted basis to include, without limitation, a list of all the Investee’s shareholders (legal and beneficial owners); granted and available options; convertible debt and equity; warrants; and any other rights to share ownership;
22.214.171.124. Details of the share classes and ownership of the Investee, including details of the fully diluted share capital of the Investee, including all granted and available share options; warrants; convertible debt or any other convertible securities; and any other right to acquire shares; confirmation that all existing shareholders are either not subject to pre-emption or have agreed to waive pre-emption in relation to the share issue following the Crowdcube fundraise;
126.96.36.199. Details of any pre-existing shareholder agreement or ancillary documents;
188.8.131.52. A complete list of all holding companies and subsidiary companies (as defined in section 1159 of the Companies Act 2006) of Investee;
184.108.40.206. Such further information and/or documents as Crowdcube may require in order to comply with identification procedures under the applicable Money Laundering Regulations and all other checks required by Crowdcube; and
220.127.116.11. A target for the fundraising to be sought by the Investee through its association with Crowdcube;
1.1.2. Prepare and procure the delivery of all information to Crowdcube in such form as Crowdcube may require to facilitate the establishment of an Investee specific sub-site within the Website and crowdfunding fundraise (the Investee's "Pitch"). Such information shall include:-
18.104.22.168. A description of the Investee's investment proposition;
22.214.171.124. The Investee’s business plan, including financial forecasts as appropriate;
126.96.36.199. The latest version of the Investee’s accounts and/or other financial information as appropriate;
188.8.131.52. An outline of any existing or proposed arrangements relating to the Investee's share capital or rights therein that may impact the investment proposition and details of any obligations of the Investee dependent upon realisation of the Investee's shares or similar exit;
184.108.40.206. Details of the equity offered, the types of shares available, the minimum and/or maximum investment required or specific investment requirements for each type of share, and an indication of the number of shares per £1 of investment;
220.127.116.11. Bespoke provisions of the Company's Articles of Association or shareholders' agreement currently in place or envisaged;
18.104.22.168. The disclaimer provided by Crowdcube;
22.214.171.124. The risk warning provided by Crowdcube; and
126.96.36.199 Such other information as Crowdcube may reasonably require from time to time;
1.1.3. Pay, without deduction, deferment or set off, to Crowdcube any and all fees, including company secretarial fees, and charges as separately notified to the Investee by Crowdcube immediately the same become due for payment, as referred to in clause 4. Crowdcube shall endeavour to provide details of its fees on its Website from time to time. The Investee agrees that Crowdcube shall, where possible, liaise with the third party money transfer organisation to deduct both Crowdcube's fees and the third party's fees from the funding raised from Crowdcube members, prior to the Investee receiving the net funding amounts raised and the Investee acknowledges that no monies raised through Crowdcube shall belong to the Investee and the Investee shall have no interest therein until the same are received by the Investee;
1.1.4. Adopt Articles of Association in such form as Crowdcube may from time to time agree or such other terms of which have been disclosed to Investors and are acceptable to Crowdcube, to enable the requisite shares to be offered to members of Crowdcube who apply to become shareholders of the Investee;
1.1.5. Pass, sign and/or adopt any documentation in such form as Crowdcube may from time to time require to facilitate the issuing of shares to members of Crowdcube who apply to become shareholders of the Investee;
1.1.6. Inform its current shareholders of the proposed transaction in accordance with its current Articles of Association and/or shareholders' agreement, and ensure that any necessary consents to the Pitch and the proposed transaction are obtained in advance including pre-emption waivers;
1.1.7. Payment processing services for the Investee on the Website being provided by Stripe and the Investee being subject to the Stripe Connected Account Agreement, which includes the Stripe Terms of Service (collectively, the “Stripe Services Agreement”). By agreeing to these Investee terms, the Investee agrees to be bound to Stripe on the terms of the Stripe Services Agreement, which may be modified by Stripe from time to time. As a condition of Crowdcube enabling payment processing services through Stripe, you agree to provide Crowdcube accurate and complete information about you and your business, and you authorize Crowdcube to share it and transaction information related to your use of the payment processing services provided by Stripe. For the avoidance of doubt, the Investee agrees that Crowdcube is not liable for the actions of Stripe or for any chargebacks from investors
1.1.8. Consider with its board of directors engaging appropriate independent professional advisors to advise the Company on raising investment via the Crowdcube platform. Such engagement shall be a matter for each Investee. Crowdcube shall have no obligation to ensure the Investee receives professional advice nor liability to the Investee or their Investors for any loss if such advice is not taken;
1.1.9. Until expiry of the Offer Period (as defined at clause 5.1 below) not directly or indirectly, in connection with any securities to be made available to members of Crowdcube through the Website, permit any offer of such securities to persons outside Crowdcube's membership or permit the communication of any invitation or inducement to engage in investment activity to any such person whether on a third party website or crowdfunding platform or otherwise and the Investee shall indemnify Crowdcube and hold Crowdcube harmless in respect of any loss, liability, cost or expense resulting from the same;
1.1.10. Agree to the use by Crowdcube and license to Crowdcube, all Investee trade names, trademarks, logos and other intellectual property of or licensed to the Investee as reasonably necessary and/or desirable for the purposes of facilitating the offer of securities to be issued by the Investee through the Pitch to members of Crowdcube or for the general purposes of the promotion of Crowdcube or the Website, and indemnify and hold Crowdcube harmless in respect of any loss, liability, cost or expense resulting from Crowdcube's use of the same;
1.1.11. Arrange for those persons who place an order and apply to become shareholders of the Investee, in cooperation with the Investee's shareholders, to be issued with shares in the Investee on the terms of the Articles of Association referred to at clause 1.1.4 subject to receipt of the Subscription Price (as defined below) by the Investee upon completion of such arrangements;
1.1.12. Ensure that any marketing materials disseminated by the Investee comply with applicable law and regulation, including displaying risk warnings and, where such marketing materials may be financial promotions, that these are approved in advance by Crowdcube before they are published;
1.1.13. Not market or otherwise offer investment opportunities available on the Website to any investors in a country or jurisdiction where such an offer would be unlawful or would contravene local securities laws or regulations unless otherwise agreed with Crowdcube in writing and subject always to the Investee complying with applicable laws and regulations in each territory in which an offer is made. This restriction includes not offering or soliciting shares in the United States unless otherwise agreed with Crowdcube and subject always to Investee complying with applicable laws and regulations in the United States. The Investee does not hold Crowdcube liable for any liability or regulatory burden arising in any such country or jurisdiction outside of the United Kingdom as a result of Investee’s shares being made available on Crowdcube platform or any marketing activities of Investee or Crowdcube in relation to such securities;
1.1.14. Use best endeavours and devote such time and attention as is reasonably necessary secure a successful fundraise for its Pitch;
1.1.15. Permit a background check provider as selected by Crowdcube to carry out a credit and background check on the Investee and to procure permission from all directors and advisors of the Investee that Crowdcube may also carry out automated background checks on them individually;
1.1.16. Send at least two business updates per year to all of its shareholders following a successful fundraise in addition to any statutory requirements in respect of the circulation of information to its shareholders;
1.1.17. Provide Crowdcube with copies of any business updates or mass communications with shareholders following a successful fundraise and promptly respond to any requests from Crowdcube about the Investee to enable Crowdcube to update the Investors where necessary. This requirement shall be satisfied by sending a copy of the relevant update or communication in electronic format to [email protected];
1.1.18 Complete all necessary statutory and regulatory filings with any court, governmental authority or authority or body required by any jurisdiction applicable to it in respect of the Pitch including, without limitation, at Companies House and the Securities and Exchange Commission;
1.1.19 Where the Pitch is, or is planned to be, subject to SEIS and/or EIS tax reliefs, provide Crowdcube with the Advance Assurance from HMRC and the application from the Investee to HMRC for such Advance Assurance. It is the Investee’s responsibility to provide all information required to HMRC for such HMRC Advance Assurance and Crowdcube does not provide advice on qualification of SEIS or EIS. If this clause 1.1.19 applies, Investee shall use best endeavours to remain a qualifying business for the purposes of SEIS and/or EIS for a period of 3 years from the date of the issue of shares.
1.2. The Investee shall not:
1.2.1. While a Pitch on the Website is being prepared or while a Pitch is live and until shares are issued to Investors, list a Pitch on another crowdfunding site or raise any other investment or debt financing, other than with the prior written consent of Crowdcube;
1.2.2. In any way manipulate a Pitch, including without limitation adding and subsequently removing investment, or adding investment which is not intended to be paid up. The Investee shall not remove, or allow to be removed, any investment made by its founders, directors, senior management, or any individual (natural of corporate) mentioned in the Pitch; and
1.2.3. Market to any person in a country or jurisdiction where it would be illegal to make such an investment or to market such an investment opportunity.
1.2.4. Use any Investor Personal Data (as defined in clause 17 below) other than as set out in clause 17 below. If a Pitch is unsuccessful or is cancelled for any reason, unless prior written consent has been given by Crowdcube (in Crowdcube's absolute discretion), Investee shall not contact Crowdcube members about the investment opportunity or offer or otherwise solicit investment from Crowdcube members, unless such Crowdcube members have independently requested further information from the Investee without solicitation from the Investee, and at all times the Investee shall act in accordance with applicable law and regulation, including in relation to data protection and company law. The Investee shall cease to contact or offer investment opportunities to any Crowdcube members immediately upon request by Crowdcube. The Investee shall notify Crowdcube prior to accepting any investment from Crowdcube members who have been introduced to the Investee by Crowdcube and shall pay Crowdcube the commission on monies raised from such Crowdcube members during the 12 month period following cancellation of a Pitch within 15 days of receipt of an invoice from Crowdcube. Such fee is not payable where the Investee has written evidence (such as an email chain) that the Crowdcube member was already known to the Investee and was not introduced by Crowdcube.
2. CLIENT CATEGORISATION
2.1. Under the FCA's rules, Crowdcube is required to allocate and notify each Investee of its client classification and Crowdcube has classified the Investee as a Retail Client, as defined by the FCA in the FCA Handbook and applicable rules.
2.2. The Investee acknowledges that Crowdcube will not supply confirmations of any transactions or orders that it receives and transmits to the Investee, and that the 7 working day confirmation email (as referenced in clause 3.1.3) shall constitute sufficient and adequate reporting of the service of arranging transactions and the receipt and transmission of orders provided by Crowdcube in accordance with the FCA Handbook, Conduct of Business Rules, Rule 16.1.1, and hereby consents to the same.
3. CROWDCUBE'S OBLIGATIONS
3.1. Subject to clause 3.2 below, Crowdcube shall:-
3.1.1. Use reasonable endeavours to make the Website available to the Investee for the purposes of the Pitch and the raising of funds for which the Pitch is intended;
3.1.2. Use reasonable endeavours to elicit applications from its members for subscriptions for shares in the Investee by means of the Pitch and the Website by communicating the Pitch as a financial promotion to its members;
3.1.3. On completion of the fundraising through the Pitch, send a 7 working day confirmation email to the Investors seeking confirmation of their orders and co-ordinate the same (unless certain investors have agreed to alternative subscription process with the Investee); and
3.1.4. Liaise with the Investee and any relevant third parties with a view to ensuring the transfer of funds from Investors to the Investee on completion. This obligation does not place an obligation on Crowdcube to transfer funds itself and is not a guarantee that funds will be transferred.
3.2. Crowdcube is under no obligation to list the Investee’s Pitch on the Website and may reject a pitch in Crowdcube’s absolute discretion. Crowdcube may also suspend a Pitch in its discretion. Fees shall not be payable by the Investee to Crowdcube where a Pitch is rejected or removed by Crowdcube, unless the Investee is in breach of this Agreement.
3.3. Crowdcube may recommend the use of a specific professional advisor to the Investee, and in such circumstances the Investee acknowledges that Crowdcube shall have no liability in relation to or involvement in the engagement of such advisor by the Investee, and such relationship will be governed by the terms of engagement between the advisor and the Investee. Crowdcube has no responsibility to ensure the Investee takes professional advice nor liability to the Investee for loss if such advice is not taken.
4. REMUNERATION AND FEES
4.1. Crowdcube shall charge a commission of 7% (which is exclusive of VAT) on all monies raised by an Investee through a Pitch or in consequence (whether directly or indirectly) of publication of a Pitch on the Website, deducted automatically by Crowdcube from monies received from Investors. This shall include all monies pledged and invested in the Pitch whether collected through the Crowdcube platform or transferred directly by Investors to Investee. The commission set out in this clause is subject to clause 15.3 and 15.4 below.
4.2. The Investee acknowledges that ancillary charges or fees, including legal fees, may be payable to third parties in connection with the investment, and acknowledges that such charges or fees are disassociated with these terms.
4.3. The Investee agrees to pay all processing fees and charges of the investment, which will include a 0.25% Crowdcube investment completion processing fee and any and all charges and fees levied by any third party money transfer provider, as engaged in accordance with clause 1.1.7, and agrees to indemnify and hold Crowdcube harmless from any loss, liability, cost or expense resulting from the same. This includes any foreign exchange fee if it is required.
4.4. All charges under this clause 4 shall be paid within 30 days of the date of an invoice from Crowdcube or shall be collected by Crowdcube by electronic transfer from the Investee either deducted from draw down of investment monies or separate electronic transfer from the account connected by the Investee to Crowdcube’s systems under 1.1.7 above.
4.5. All commission and fees under this clause 4 are payable in any event once a Pitch reaches 100% of the initial target investment amount as set out in the Pitch. Such fees remain payable if the Crowdcube campaign is cancelled for any reason after a Pitch has reached 100% of its initial target investment amount set out in the Pitch. The Investee shall pay such amount within 15 days of receipt of an invoice from Crowdcube. Clause 1.2.4 sets out the commission payable in the event that a Pitch is unsuccessful or otherwise cancelled and an Investee goes on to raise money from Crowdcube members introduced by Crowdcube.
4.6. Additional services, including any marketing agreement, shall be agreed separately by the parties by email (or where required by Crowdcube, in the form specified by Crowdcube, which for marketing services shall set out the type of advertising to be purchased and the cost). Agreement by email shall apply to such additional services and the Investee shall pay any invoice within 30 days for such agreed services and/or marketing services, prior to a Pitch going live on the Website.
4.7. The Investee is liable for all taxes payable under this Agreement and the issue, holding or transfer of shares, including, without limitation, if there is a change in VAT laws and VAT becomes payable on any fees due to Crowdcube.
5. INVESTMENT PROCESS
5.1. Investors shall be entitled to place revocable orders to subscribe for shares in the Investee through the Pitch for a period (the "Offer Period") ending on the earlier of:
5.1.1. the Investee reaching its target level of investment (including any overfunding) as set out in its Pitch;
5.1.2. the expiry of a 30 day period (beginning with the date on which the Pitch becomes live on the Website) or such shorter or longer period as Crowdcube shall in its absolute discretion agree in writing with the Investee; or
5.1.3. the date upon which the Investee terminates its Pitch in accordance with this Agreement.
5.2. If the Pitch is successful, when the Investor places an order to subscribe for shares in an Investee, the Investor has demonstrated the Investor’s intention to enter into an agreement with the Investee, or a third party on behalf of the Investee, to transfer the subscription price of the relevant shares (the "Subscription Price") to the Investee. Subject to transfer of funds by the Investor and satisfaction of the conditions set out at clause 5.5, shares in the Investee will be issued to the Investor by the Investee and the Subscription Price will be transferred to the account of the Investee following the end of the Offer Period after deduction of any Crowdcube fees under clause 4 above. If the Pitch is not successful, the agreement between the Investor and the Investee for the transfer of the Subscription Price shall not be actioned. Crowdcube does not guarantee transfer of funds by Investors to the Investee and Crowdcube is not responsible for payment of the Subscription Price itself.
5.3. The Investee agrees that the contract to invest between the Investee and each Investor formed in accordance with clause 5.4 shall incorporate any warranties given in the legal review document (the “Legal Review”) attached to the email sent from Crowdcube to each of the Investors referred to at clause 5.4 below (the “Warranties”), subject to the terms and limitations of such Warranties as set out in the Legal Review and completion is subject to the conditions set out in the Legal Review.
5.4 The Investee will instruct Crowdcube to circulate a copy of the Investee's proposed Articles of Association and Legal Review to each of the Investors by email, and to request that each Investor inform Crowdcube by email within a cooling off period as determined by Crowdcube in its absolute discretion, but which will generally be no shorter than 7 days (“Cooling Off Period”) if they no longer wish to proceed with the investment. If Crowdcube receives no response from the Investor within the Cooling Off Period, the Investor will be deemed to have confirmed his order and, subject to the completion conditions in clause 5.5, his or her order will become an irrevocable firm order and a binding legal contract will be formed between each and every Investor and the Investee.
5.5. Subject to clause 5.6, the contract to invest between the Investee and each Investor is subject to the following completion conditions:
5.5.1 at least 90% of the initial target investment amount set out on the Pitch shall be received by the Investee from Investors unless Crowdcube determines, in its absolute discretion, that the investment amount confirmed or received is adequate in the circumstances;
5.5.2 the Warranties remaining true and there being no actual or contemplated material change to the Investee or the investment round, either before or after the expiry of the Cooling Off Period set out in clause 5.4 above, and prior to the issue of shares to Investors (such material change to be determined by Crowdcube in its sole discretion);
5.5.3 confirmation of satisfaction of any specific requirements or conditions set out in the Legal Review;
5.5.4 the Investee agreeing the correct number of shares to issue to Investors, as determined by Crowdcube being equivalent to the equity offered on the Pitch on a fully diluted basis. If the Investee is not a UK company, unless otherwise agreed with Crowdcube and disclosed to Investors, the shares provided to Investors shall be equivalent to the equity percentage and value in pound sterling and the Investee’s pre-money fully diluted valuation in its local currency shall be modified prior to completion to reflect this as required by Crowdcube; and
5.6 Crowdcube (and not the Investee or Investor) has absolute discretion to determine whether the conditions set out in clause 5.5 above are satisfied at any time during the completions process prior to the issue of shares to Investors by the Investee. If Crowdcube determines a condition is not satisfied, Crowdcube may in its absolute discretion:
5.6.1 recirculate the Cooling Off Period email to include, as required by Crowdcube, the Articles of Association of the Investee alongside a disclosure statement detailing the failed condition. This shall also request that each Investor inform Crowdcube by email within such time period (determined by Crowdcube in its absolute discretion) specified in the email, if they no longer wish to proceed with the investment. If Crowdcube receives no response from the Investor within the time period specified in the email, the Investor will be deemed to have confirmed his order in the same manner as clause 5.4 and subject to clauses 5.5 and 5.6; or
5.6.2: determine that the investment opportunity is cancelled, either before or after the expiry of the Cooling Off Period. In these circumstances, if the Cooling Off Period has expired, the contract to invest between the Investee and Investor shall not complete and there shall be no legally binding contract between the Investee and Investor.
5.7 If the Pitch is unsuccessful, cancelled under clause 5.6.2, or the order not completed for any reason, the Investor's order will be cancelled and will not be transferred to another Pitch or Investee, and no substitute service will be provided. Clause 1.2.4 shall also apply to Investee. The Investee shall at Crowdcube’s request cancel the investment made by the Investors and return the Subscription Price to the Investors (if any monies have been transferred), and shall liaise with Crowdcube throughout. The Investee consents to Crowdcube releasing such information as is reasonably necessary, to the Investors and to communicate with them to allow cancellation of investments and such return of the Subscription Price.
5.8. The Investee shall liaise with Crowdcube throughout the completions process in good faith and shall promptly respond to Crowdcube for any request.
5.9. Crowdcube may assist the Investee with corporate administration matters relating to the investment process, to prepare the investee company to raise investment via the Crowdcube platform. Crowdcube is not licensed or insured to provide advice to investee companies and such assistance is not legal, financial or tax advice of any kind and should not be considered by Investee as such. If an Investee requires advice and opinions on legal, financial or tax matters relating to their company and Pitch, they should contact an independent professional firm as appropriate.
5.10. In the event that the Investee agrees written terms with Crowdcube (the “Nominee Terms”) for the provision of a nominee (the “Crowdcube Nominee”) in connection with the issue of shares pursuant to the Pitch, any reference in this Agreement to the issue of shares to Investors (or similar expression) shall include the issue of shares to the Crowdcube Nominee to hold on trust for Investors.
5.11. The terms relating to the provision of any rewards for investment advertised on the Pitch shall constitute part of the contract formed between the Investee and each Investor pursuant to clause 5.3. Crowdcube shall not be responsible for the provision of such rewards and shall not be liable for any delay or failure of the Investee in the provision of such rewards. The Investee shall indemnify Crowdcube in respect of any loss, liability, cost or expense incurred by Crowdcube as a result of the Investee’s failure or delay in providing such rewards.
6. INVESTMENTS / PITCHES
6.1. The Investee acknowledges that it does not rely upon any advice, representations or requirements of Crowdcube in relation to the Pitch, and acknowledges that it is solely responsible for the Pitch complying with all applicable laws and regulations. The Investee further acknowledges that Crowdcube is an independent organisation, and does not act as agent or representative of the Investee or any Investor. The Investee acknowledges that it must seek independent advice should it have any legal, financial, regulatory or other concerns about the Pitch.
6.2. The Investee agrees to adhere to all reasonable requirements in relation to the investment process laid down by Crowdcube from time to time in respect of regulatory and/or legal compliance in relation to the investment process and the Pitch, and shall provide all such information and documentation that Crowdcube requires from time to time to ensure such compliance.
6.3. The Investee must ensure that information contained within the Pitch that contains an indication of past performance satisfies the following conditions:
6.3.1. the indication is not the most prominent feature of the communication;
6.3.2. the information includes appropriate performance information which covers the lesser of the period from establishment or the preceding five years and in every case (where possible) that performance information must be based on and show complete 12-month periods;
6.3.3. the reference period and the source of information are clearly stated; and
6.3.4. the information contains a prominent warning that the figures refer to the past and that past performance is not a reliable indicator of future results.
6.4. The Investee must ensure that information within the Pitch, that contains an indication of future performance, satisfies the following conditions:
6.4.1. it is not based on and does not refer to simulated past performance;
6.4.2. it is based on reasonable assumptions supported by objective data; and
6.4.3. it contains a prominent warning that such forecasts are not a reliable indicator of future performance.
6.5. The Investee undertakes, warrants and represents that all text, content, images, pdfs and any other materials or statements that are included on the Pitch or available via the Pitch including in the forums, downloads (including without limitation in the Legal Review), and updates are true, accurate and not misleading, do not breach any laws or regulations, do not infringe the rights of any third party, including, without limitation, not being defamatory or unjustifiably denigrating of any person; not invading third party rights to privacy and not infringing any third party intellectual property rights and that the same are otherwise a clear and fair representation of the Investee or in the event of an opinion or intention, is made after careful consideration and is fair and made on reasonable grounds.
6.6. The Investee shall ensure that the Pitch contains adequate risk warnings concerning the investment for the Investor, and should not include any emphasis of any benefits to the Investor without a fair and prominent indication of the relevant risks. The Investee acknowledges that the Pitch will be reviewed by Crowdcube members generally and that the Investee should assume that information included in its Pitch will not necessarily be kept confidential. The Investee agrees that it alone shall bear all responsibility for the content of the Pitch, the Warranties and any disclosures in respect of such Warranties, and shall indemnify and hold Crowdcube harmless from any loss, liability, cost or expense resulting directly or indirectly from the same. In addition, the Investee shall ensure that the Pitch contains all information that would be relevant to a potential investor of the Investee, to the extent reasonably practicable, that the Pitch is regularly monitored and kept up to date, and shall ensure that any relevant updates are adequately communicated to current and prospective Investors either through the forum, the Pitch, the Cooling Off Period email or otherwise.
7. WARRANTY, REGULATION AND LIABILITY
7.1. The Investee, as a member of Crowdcube, acknowledges and accepts that the Website includes a forum which is intended as a service to Investees to put them in contact with Investors, and that Crowdcube's investigation of the Investees and the content of their Pitches have been limited and depends upon the disclosure, feedback and responses of Investee, and accordingly that Crowdcube makes no warranties or representations and assumes no liability in respect of the Investees or the content of their Pitches.
7.2. The Investee warrants, represents and undertakes that:
7.2.1 it shall comply with any terms and conditions associated with the use of the forums on the Website, and acknowledges that Crowdcube will in its absolute discretion have the power to determine whether any posts breach this clause 7.2.1;
7.2.2 all information disclosed to Crowdcube, investees and site users at any time, and including the Warranties, is true, accurate, not misleading and does not infringe any laws, regulations or the rights of any third party, including intellectual property rights;
7.2.3. in advance of a Pitch going live on the Website and throughout the duration of the Pitch and until monies are drawn down from the Investors to Investee, the Investee has disclosed to Crowdcube all debt, fully diluted equity issued and options granted or contemplated, any civil or criminal litigation and threats of litigation and all other material issues impacting upon Investee (and Investee’s directors, employees and contractors) which could reasonably be considered to be a factor in an investment decision by a retail, sophisticated or institutional investor;
7.2.4. any opinion or intention expressed by the Investee to Crowdcube, Investors or on the Pitch, is made after careful consideration and is fair and made on reasonable grounds and any forward looking statement is based upon objective assumptions;
7.2.5. the Investee has the right and power to enter into this Agreement and to offer the investment opportunity on Crowdcube and entering into this Agreement will not contravene, breach or conflict with the Investee’s constitutional documents or any agreement binding on it with a shareholder, lender or otherwise;
7.2.6 no litigation, arbitration or administrative proceedings are taking place, pending, or to the Investee’s knowledge, threatened against it, any of its directors or any of its assets;
7.2.7 prior to the Pitch going live, the Investee has disclosed its fully diluted share capital (as set out in clause 188.8.131.52 above) and that any valuation and equity offered reflects the fully diluted share capital of the Investee and that this will not change until completion of the funding and issue of shares;
7.2.8 the Investee has obtained consent or waiver from any and all existing shareholders who have pre-emption rights for the Investee to carry out this fundraising and proposed share issue;
7.2.9. the Investee is the sole legal and beneficial owner and has good, valid and marketable title to all its assets including but not limited to any intellectual property materially utilised by the Investee;
7.2.10. the Investee is solvent and able to pay all debts and no director of Investee has any criminal conviction or criminal proceedings against him or her; no director is subject to bankruptcy proceedings or bankrupt; no director has been a director and shareholder of a liquidated company that has gone into liquidation and transferred its assets to a phoenix company of which the director is also a director and shareholder;
7.2.11. the Investee has procured permission from all directors and advisors named on the Pitch that Crowdcube may also carry out automated background checks using a third party provider; and
7.2.12. if the Investee has represented that the Pitch is SEIS and/or EIS qualifying or pending SEIS and/or EIS, the Investee and the investment opportunity qualifies for SEIS or EIS at the time of the Pitch.
7.3. The Investee is responsible for its Articles of Association and any disclosure to Investors of any differences existing between its Articles of Association and any articles that may be suggested to the Investee by Crowdcube. Crowdcube has no liability for and does not guarantee that the Investee Company will meet its funding target as a result of a Pitch on the Website. Crowdcube has no responsibility for Investors who do not proceed with their investment either before or following receipt of the Cooling Off Period email to Investors. The Investee acknowledges that the purchase of shares is an agreement between Investee and Investors and that Crowdcube is not a party to this Agreement and cannot enforce payment by Investors and is not liable for payment of any monies raised via the Website itself.
7.4. The Investee acknowledges that the approval of the Pitch as a financial promotion by Crowdcube Capital Limited, or the proposed investment in an Investee by any officer or employee of Crowdcube or its affiliates is not an indication of approval of the Pitch generally and does not indicate that Crowdcube advises investment in the Pitch, and the Investee confirms that it shall take no inference from or make any reference to the same.
7.5 Crowdcube makes no warranty to the Investee.
7.6. Crowdcube’s entire liability under this Agreement is limited to the amount of fees received by Crowdcube hereunder. Under no circumstances shall Crowdcube be liable in contract, tort (including negligence), pre-contract or other representations (other than fraudulent or negligent misrepresentations) or otherwise under this Agreement for: (a) any economic losses (including loss of revenues, profits, contracts, business or anticipated savings); or (b) any special, indirect or consequential losses; whether or not such losses were known to the parties at the commencement of this Agreement. Nothing in this Agreement shall limit Crowdcube’s liability for fraud or for any loss which it would be unlawful to exclude.
7.7. Any money or assets held by Crowdcube (or any subsidiary or holding company of Crowdcube) for the Investee shall be held in accordance with all applicable rules set out in the FCA Handbook. Crowdcube’s client money bank account is a non interest bearing bank account.
8.1. Subject to clause 8.3, the agreement constituted by these terms between Crowdcube and the Investee shall terminate and cease to be effective forthwith upon the earlier of:-
8.1.1. the Investee serving 7 days' written notice on Crowdcube at Crowdcube's registered office confirming such termination; or
8.1.2. the Investee achieving the raising of committed funds from members of Crowdcube to the target level provided to Crowdcube by the Investee and the issue in consequence of shares to Crowdcube members and the conclusion of all other arrangements relating to the relevant investment as provided herein.
8.2. Crowdcube may terminate this Agreement at any time in the event that:
8.2.1. Crowdcube determines that the Investee has breached these Investee terms or the Warranties or completion conditions in the Legal Review;
8.2.2. Crowdcube suspects that the officers of the Investee have been involved in any criminal activities;
8.2.3. the Investee becomes insolvent; or
8.2.4. on the service of 7 days' written notice to the Investee.
8.3. If an Investee has an outstanding or incomplete order for investment from Investors which has not been resolved in accordance with clause 5, the Investee may only terminate this Agreement if it has firstly served written notice by email on Crowdcube and secondly, has withdrawn its Pitch from the Website. If a Cooling Off Period email has been issued, the Investee may only terminate this Agreement if the Cooling Off Period has not yet expired and the Investee has instructed Crowdcube to communicate a cancellation to all potential Investors.
8.4. Once an order has been made firm with an Investor following expiry of the Cooling Off Period, a formal contract has been created between the Investee and the Investor for the issue of shares direct on such terms as are agreed with the relevant Investors and the Investee is bound to complete the share issue, and Crowdcube shall have no further obligations or involvement in the investment or the Investee.
8.5. The following terms shall be continuing notwithstanding termination of this Agreement: clauses 1.1.3, 1.1.10, 3.2, 4, 6, 7, 9, 14, 15, 16, 17 and this clause 8.5.
9. COMPLAINTS AND QUERIES
9.1. Should an Investee have any complaints or queries about the services provided by Crowdcube or this Agreement, it should contact Crowdcube on 01392 241319.
9.2. Complaints may also be addressed directly to the UK Financial Ombudsman Service - contact details as follows:- 0300 123 9 123 or 0800 023 4567.
9.3. Investees are treated as customers of Crowdcube and therefore have the potential to be compensated out of the Financial Services Compensation Scheme established and operated by the FCA in the event that Crowdcube should fail in the conduct of its FCA regulated activities.
9.4. Communications with, to or from Crowdcube shall be in the English language.
10. CANCELLATION AND SUSPENSION
10.1. The Investee hereby acknowledges and consents to the performance of the services by Crowdcube in accordance with this Agreement beginning as soon as this Agreement is made between the Investee and Crowdcube and that other than as set out in this Agreement, Investee has no right of cancellation.
10.2. Crowdcube may suspend or cancel the provision of services under this Agreement, including either not listing a Pitch on the Website or removing or suspending a Pitch from the Website in the event that in Crowdcube’s opinion, the Investee is not or may not be operating in compliance with any applicable laws or regulations; if the Pitch and documentation provided by the Investee means that Crowdcube cannot approve the pitch as a financial promotion; or the Investee is (in the opinion of Crowdcube) in breach of the terms of this Agreement.
No failure or delay by a party to exercise any right or remedy provided under this Agreement or by law shall constitute a waiver of that or any other right or remedy, nor shall it preclude or restrict the further exercise of that or any other right or remedy. No single or partial exercise of such right or remedy shall preclude or restrict the further exercise of that or any other right or remedy.
12. NO PARTNERSHIP OR AGENCY
Nothing in this Agreement is intended to, or shall be deemed to, establish any partnership or joint venture between any of the parties, constitute any party the agent of another party, nor authorise any party to make or enter into any commitments for or on behalf of any other party.
13. ASSIGNMENT AND VARIATION
13.1. An Investee's membership in Crowdcube is non-transferable, and the provisions of this Agreement shall not be assigned, transferred, mortgaged, charged or otherwise encumbranced by an Investee without the written consent of Crowdcube. Crowdcube may assign this Agreement without restriction or consent.
13.2. No variation of this Agreement shall be effective unless it is in writing and signed by the parties (or their authorised representatives). Where there is a conflict between the provisions of this Agreement and an alternative agreement or amendment to this agreement that is in writing and signed by the parties, such alternative written and signed agreement shall prevail.
14.1. Any notice or other communication required to be given to a party under or in connection with this contract shall be in writing and shall be delivered by hand or sent by pre-paid first-class post or other next working day delivery service at its registered office (if a company) or (in any other case) its principal place of business or residential address, or sent by email to the email address notified to the other party in accordance with this Agreement. The email address for the service of notices on Crowdcube is [email protected]
14.2. Any notice or communication shall be deemed to have been received if delivered by hand, on signature of a delivery receipt or at the time the notice is left at the proper address, or if sent by email, at 9.00 am on the next working day after transmission, or otherwise at 9.00 am on the second Business Day after posting or at the time recorded by the delivery service.
15. ENTIRE AGREEMENT
15.1. This Agreement, together with any legally-binding terms agreed in any written and signed term sheet entered into by the parties prior to the date of this Agreement (a “Term Sheet”) and (if applicable) the Nominee Terms, sets out the entire agreement and understanding between the parties in respect of the subject matter of this Agreement.
15.2. Save as specified in clause 15.3, if there is any ambiguity or conflict between the provisions of this Agreement and the provisions of any Term Sheet, the provisions of this Agreement shall prevail between the parties.
15.3. To the extent the fees specified in any Term Sheet and (if applicable) the Nominee Terms differ from those set out in clause 4 of this Agreement, the fees specified in the Term Sheet and (if applicable) the Nominee Terms shall apply and be binding on the Investee.
16.1. Save as permitted by clause 16.2, the Investee undertakes that it shall not at any time during the term of this Agreement and a period of two years thereafter disclose to any person any confidential information concerning the business, affairs, customers, clients or suppliers of Crowdcube or any member of Crowdcube’s group of companies.
16.2. The Investee may disclose Crowdcube’s confidential information:
16.2.1. to its employees, officers, representatives or advisers who need to know such information for the purposes of carrying its obligations under this Agreement. The Investee shall procure that its employees, officers, representatives or advisers to whom it discloses Crowdcube’s confidential information comply with this clause 16; and
16.2.2. as may be required by law, a court of competent jurisdiction or any governmental or regulatory authority.
16.3. The Investee shall not use Crowdcube’s confidential information for any purpose other than to perform its obligations under this Agreement.
17. DATA PROTECTION
17.1 In this clause the following definitions apply:
Data Controller: has the meaning set out in section 1(1) of the Data Protection Act 1998 or the General Data Protection Regulation as applicable.
Data Subject: an individual who is the subject of Personal Data.
Personal Data: has the meaning set out in section 1(1) of the Data Protection Act 1998 or the General Data Protection Regulation and relates only to personal data, or any part of such personal data, of which Crowdcube is the Data Controller and in relation to which the Investee is providing services under this Agreement.
Data Processing and Processor: have the meaning set out in the Data Protection Act 1998 or the General Data Protection Regulation as applicable.
17.2 Subject to clause 17.3, 17.4 and 17.5, during a live Pitch and before an Investment completes Crowdcube is the Data Controller and the Investee is the data processor of any Personal Data of a Crowdcube user and the following shall apply during this period prior to completion:
17.2.1 the Investee shall process the Personal Data only to the extent, and in such a manner, as is necessary to respond to requests for information about the Pitch and in accordance with Crowdcube’s instructions from time to time and shall not process the Personal Data for any other purpose.
17.2.2 the Investee shall not add Crowdcube user Personal Data to any general marketing email lists or otherwise; and
17.2.3 the Investee will keep a record of any processing of Personal Data it carries out.
17.3 Upon completion of the Pitch and issue of issue of shares to Investors, in order to enable Investee to administer its share register, manage corporate actions and provide investor updates, Crowdcube shall provide Investee with a full list of Investors and associated Personal Data, including name, email address, address and at that point, Investor becomes Data Controller of all Personal Data held by it in relation to those Investors and Investee shall delete all other Personal Data received from Crowdcube users who have not invested. Investee shall be the data controller in relation to such retained Personal Data and as such is responsible for compliance with all applicable data protection laws including the GDPR.
17.4 If the Pitch is not successful, Investee shall irretrievably delete all Personal Data received from Crowdcube.
17.5 The Investee shall process the personal data as follows:
17.5.1 only on documented instructions from the Data Controller, including with regard to transfers of Personal Data to a third country or an international organisation, unless required to do so by Union or Member State law to which the processor is subject; in such a case, the Investee shall inform the Data Controller of that legal requirement before processing, unless that law prohibits such information on important grounds of public interest;
17.5.2 persons authorised to process the personal data shall have committed themselves to confidentiality or are under an appropriate statutory obligation of confidentiality;
17.5.3 using all security measures required pursuant to Article 32 of the General Data Protection Regulation, including without limitation, that the Personal Data is secure, anonymised were possible and encrypted;
17.5.4 taking into account the nature of the processing, assists the Data Controller by appropriate technical and organisational measures, insofar as this is possible, for the fulfilment of the Data Controller's obligation to respond to requests for exercising the data subject's rights to access data and other rights; and
17.5.5 at Crowdcube's request, the Investee shall provide to Crowdcube a copy of all Personal Data held by it in the format and on the media reasonably specified by Crowdcube.
17.6 The Investee shall promptly comply with any request from Crowdcube requiring the Investee to amend, transfer or delete the Personal Data.
17.7 If the Investee receives any complaint, notice or communication which relates directly or indirectly to the processing of the Personal Data or to either party's compliance with the Data Protection Act 1998 or the General Data Protection Regulation and the data protection principles set out therein, it shall immediately notify Crowdcube and it shall provide Crowdcube with full co-operation and assistance in relation to any such complaint, notice or communication.
17.8 The Investee shall not transfer the Personal Data outside the European Economic Area without the prior written consent of Crowdcube.
17.9 The Investee shall promptly inform Crowdcube if any Personal Data is lost or destroyed or becomes damaged, corrupted, or unusable. The Investee will restore such Personal Data at its own expense. The Investee shall notify Crowdcube immediately if it becomes aware of any unauthorised or unlawful processing, loss of, damage to or destruction of the Personal Data.
17.10 Crowdcube is entitled to inspect or appoint representatives to inspect all facilities, equipment, documents and electronic data relating to the processing of Personal Data by the Investee. The Investee shall give access to Investee’s systems and all data for the purpose of audit of Personal Data and compliance with this agreement and Privacy Impact Assessments.
18. GOVERNING LAW AND JURISDICTION
18.1. This Agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales.
18.2. The parties irrevocably agree that the courts of England and Wales shall have non-exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this Agreement or its subject matter or formation (including non-contractual disputes or claims).
SUBMITTING YOUR PITCH AND DETAILS OF INVESTEE COMPANY TO CROWDCUBE VIA THE WEBSITE CONFIRMS YOUR ACCEPTANCE OF THESE TERMS AND CONDITIONS. If you do not understand any of the terms set out in this Agreement or have any queries, please obtain independent advice before proceeding.