441-035-0120 Required Disclosures (1) Prior to the sale of any OIO security, each prospective investor must be given, in a single written document, the disclosures identified in subsection (2). For the purposes of this exemption, “in writing” includes printed, electronic, and internet media. An interested party must be given the option to receive the disclosures and subsequent reports in one or more formats, including printed copies at no charge. (2) The disclosures required by these rules must include: (a) The name(s) and physical address(es) of the issuer and of all officers, principals, managing partners and shareholders of the issuer holding a 20% interest or more, or persons holding a substantially similar position; (b) A description of the experience and qualifications of the issuer officers, principals, managing partners and persons holding substantially similar positions; (c) A description of the business, including how long it has been in operation and the specific reason for the offering; (d) A discussion in plain language of the significant factors material to the offering, including those that make the offering speculative or risky. Risk factors may include, among other things: (A) Your lack of an operating history; (B) Your lack of profitable operations in recent periods; (C) Your financial position; (D) Your business or proposed business; (E) The lack of a market for your common equity securities or securities convertible into or exercisable for common equity securities; (F) That offerings may last a total of 24 months. (e) The total offering amount and how the issuer will use the proceeds of the offering, including compensation and expenses related to the offering. (f) The terms under which funds raised or pledged will be released from an escrow or similar dedicated account upon an issuer reaching its minimum offering amount and terms for returning funds to investors if minimum is not raised.; (g) A description of the terms and conditions of the securities being offered, the total amount of securities that are outstanding prior to the OIO, and the total amount of securities being offered or sold in reliance on the OIO exemption: (A) If the issuer is offering stock, a description of the terms and conditions must include either the percentage of ownership represented by a single share, or the total value of the Oregon business implied by the offering price. (B) If the issuer is offering notes or debentures, a description of the terms and conditions must include the interest rate and specific terms of repayment. (h) A description of any litigation, legal, or regulatory proceedings within the past five (5) years, if any, involving the issuer or any persons associated with the issuer. (3) The issuer must inform all investors that the securities exempted by these rules are not registered with the state, that they are subject to a limitation on re-sale and investors may not be able to sell their securities promptly or may only be able to sell them at a substantial discount from the offering price. The following language must appear on the cover page of the offering document: “Offers and sales of these securities are made under an exemption from registration and have not been registered under the Securities Act of 1933 or the Oregon Securities Law. Resale is prohibited for a period of six (6) months from the date of sale except to the issuer of the security or to an Oregon Resident after the security has been registered pursuant to ORS 59.055. Sales will be made only to residents of Oregon. Investors should be aware that they will be required to bear the financial risks of this investment for an indefinite period of time. In making an investment decision, investors should rely on their own examination of the issuer, the terms of the offering, the merits, and risks described in these offering documents. These securities have not been recommended by any federal or state authority or regulatory commission nor have they confirmed the accuracy or determined the adequacy of this document. Any representation to the contrary is a criminal offense. Business technical service providers have not reviewed the offering documents and cannot determine the merits of this offering." (4) Any certificate, document or other evidence of the security, must contain the following legend: Offers and sales of these securities were made under an exemption from registration and have not been registered under the Securities Act of 1933. For a period of six (6) months from the date of sale by the issuer of these securities, any resale except to the issuer or to an Oregon resident after registration of the securities under ORS 59.055. Statutory/Other Authority: ORS 59.035 & 17 CFR § 230.147A Statutes/Other Implemented: ORS 59.035 History: FSR 12-2017, amend filed 12/28/2017, effective 01/01/2018 FSR 8-2017(Temp), f. & cert. ef. 7-12-17 thru 1-7-18 FCS 1-2015, f. & cert. ef. 1-15-15