Investor Presentaiton

Eligible Business Corporations (EBCs): Debt financing and/or in-kind transactions are not eligible for tax credit; however, shares issued upon the conversion of debt may be eligible if converted at principal amount remaining. Accrued interest is not eligible for tax credit. Venture Capital Corporations (VCCs): VCCs are permitted to use debt to make an investment into an eligible small business if the debt instrument meets the requirements outlined in Section 1(4) of the Regulation. Registered VCCs are required to pay an amount of money equal to 30 per cent of all amounts received as equity capital into an Investment Protection Account (IPA). Once the VCC has made an investment into an eligible small business, or will use the money to make an eligible investment, the Government of Alberta will authorize a proportionate payment out from this IPA. The VCC must make timely investments into an eligible business; it will be required to invest the capital raised within a prescribed period of time. The rules are as follows: • At least 40 per cent of equity capital raised during a VCC's fiscal year must be invested by the end of its first following fiscal year. • At least 80 per cent of equity capital raised during a VCC's fiscal year must be invested by the end of its second following fiscal year. Up to 20 per cent of equity capital raised may be used for administration expenses. Monies must be deposited into an Investment Protection Account (IPA) where the funding and accrued interest can be tracked. Step 5: Apply for Tax Credit Certificates Tax Credit Certificates will be approved on a first-come, first-served basis until the annual budget is fully allocated. The sooner the EBC or VCC raises equity capital, the sooner they can apply to receive approval for the Tax Credit Certificate and ensure allocation from the annual program budget. Each investor will provide their personal and/or corporate information to the EBC or VCC who will then apply for the tax credit certificate on behalf of the investor. The tax credit will then be provided to the EBC or VCC who will provide it to the investor. Registered EBCs and VCCs must request Tax Credit Certificates on behalf of their investors for eligible investments. EBCs and VCCs must collect appropriate information from their investors and use it to complete the Share Purchase Report. The report is accessible through the online 18 Alberta Investor Tax Credit Program | January 2019

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