Dr. John's
Answers to
General
Financial
Questions.
Thanks for your questions! We look forward to many more from
you and hundreds of others as the word of our program spreads.
We will be activating a new section in our conference, forum and
chat rooms during the next 30 days so that when you have
questions they can be addressed promptly.
.....Dr John.
Week #1 Questions:
...from Kevin:
Comment: I am very interested in this program. I read the
information on the FairShare website but didn't get some
answers that I was looking for.... Could you please answer
these questions for me?
Question: When I purchase share in the IPO or Venture Capital .....
Where are they kept? Are they sent to me? or stored somewhere else?
You have only one option at this time in these
types of investments. You should request the
physical certificate in your name. I feel that this is
a good idea even if you are a basically long term
investor with a brokerage account for conventional
investments. However, this is normally inconvenient if you are
an active trader (buying and selling regularly) in the
conventional markets because it could hold up your
settlements.
Several years ago "book-entry" type shareholder record
keeping became popular in certain types of securities.
Brokers do not like it because it takes control of your
securities out of their hands. In this instance the issuer's
registrar and transfer agent (licensed and bonded) keeps the
record of a holders securities in a computer in the holders
name. No physical certificates are issued (unless the holder
requests them).
In dealing with a company's bulletin board system, such as I
described to you earlier, you will need your physical
certificate to complete a transaction. The FairShare Capital
Market (FCM) that we have planned will require both a transfer
agent and a bank account. If a member wants to purchase
stock from another member the purchaser's bank account will
be debited (for the purchase price) and the seller's transfer
agent account will be debited (for the shares sold). When you
have time go to FairShare Capital Market at for additional
details.
Question: How will the shares that I buy in a direct public offering be
bought and sold?
The IPO and secondary new offering shares will
in most instances be purchased directly from the
issuing company with no commissions or
underwriting fees involved. The purchase and
sale of shares of companies that go public without an
underwriter do not usually trade on an organized market such
as NASDAQ or even the OTC Bulletin Board (OTCBB)
because the market for the shares is not supported by a
broker.
Under federal rules that went into effect within the last two
years a company can maintain a bulletin board trading system
(there are now several doing this successfully) where
potential buyers and sellers can meet and transact a trade.
This is not a market that is necessarily liquid because there
may be times that that there are neither buyers nor sellers that
are interested in completing a trade. But it can and does work
in some instances. FairShare has its own plans for companies
that its members have an interest in. You can find more
information on this at our site under "FairShare Capital
Market" ("FCM"). We anticipate that it will take two years and
the expenditure of several million dollars (along with
regulatory approval) before this system is up and running. The
FCM will be for Members only.
At this point we view any offering that is introduced to our
members as venture capital because of the development
stage of the company. Members who invest in these offerings
should be prepared to hold for at least two years to give the
company an opportunity to mature and grow. It is during this
period that any shares you purchase will be relatively illiquid.
When the company is ready and can qualify for a NASDAQ or
exchange listing it will likely do so. When this happens
everything changes. Then an investor should be able to buy
or sell his or her stock through any broker.
Question: Where will my money be kept for buying and selling?
The Member is always in control of both his (her)
money and his (her) securities either with the
issuer sponsored bulletin board or the planned
FCM described above. In both instances you will
always be dealing with a bank and/or a licensed and bonded
transfer agent in the settlement process. In conventional
markets the broker serves in this capacity. In no case will
FairShare ever have control over a Members assets.
Question: How does the system work? For example ..... a company is
picked as a potential candidate, I like the pick and decide to invest in the
company...... Could you explain what would happen from there?
A company that has passed the screening and
evaluation process and been selected as a
candidate will, because of its agreement with
FairShare, allocate its offering to FairShare
Members. A brief description of this process can be found at
the Locate, Evaluate and Negotiate page. Members will be
notified as to what portion of the allocation (from the issuer)
they have a priority position to purchase. The Member then
can send in a non-binding indication that they (1) do not want
their allocation; (2) want their allocation or (3) want their
allocation plus more if it becomes available. When the
offering has cleared the federal registration and the state
registration required in the Member's state of residence the
Member will be notified and will have a period of time to send
his money into a bank in order to finalize the purchase.
The only difference in the above has to do with FairShare's
own planned public offerings. The Charter Members will
(subject only to regulatory approval of the process) be
allocated 50% of any FairShare's offerings as a benefit to you
for joining early. For additional benefits you can go to the
Why Now page for more information. We want our Members
to own the majority of the FairShare equity stock. They will
deserve to receive the anticipated benefits as FairShare
grows because of their early involvement. This is one of the
major differences between FairShare and other companies
that may be thinking about competing with us.
There are places on both our new site and our archives
where you can get more information on the above subjects.
Then you might want to go to the "Investment Model" button for
even more information. The archives information is roughly
correct but you must understand that we are pioneering a new
investment concept for average or new investors and that it is
going to evolve with experience in its application.
Question: Is there a minimum investment that I can make in any particular
company that qualifies as a FairShare candidate?
Minimum purchases right now are planned at $100
although we anticipate that many investors will
purchase from $250 to $1,000 in any one offering.
Example: $5,000,000 offering. FairShare has 5,000
Charter Members (which is its short term goal) and 25,000
Regular Members (our goal is 100,000 within 12 months).
$1,000,000 (20%) of the offering would automatically allocated
by the issuer to our Charter Members ($200 each) with the
balance of $4,000,000 (80%) allocated to the 25,000 Regular
Members (approximately $150 each). It is at this point that the
member makes the non-binding decision (called an indication
of interest) as to what he/she wants to do. Any allocations that
are not taken will be available on a first come - first served
basis to Charter Members first. Then to all the Members on a
first come-first served basis until the offering is completed.
...from Joe Saladino:
Question: In the future, will Fairshare make money from the money I
invest?
Absolutely not! FairShare does not receive any
commission or other success fee based
compensation relating to the sale of any security.
FairShare, works only for its Members and
receives its profits from the membership and service fees.
Question: Does FairShare ever own stock in the companies that it
presents to its Members as candidates?
FairShare, will in some instances, have the right
to purchase securities of a candidate company at
a price that is equivalent to the price its members
pay. No special under the table type deals will be
condoned. No cheap stock. No free stock. No stock for
services, etc. You should view FairShare as an information
provider. In addition, our rules restrict us from accepting
compensation from an issuer (candidate company) for any
purpose other than reimbursement of some due diligence
expenses.
...from Blain Clampitt:
Comment: I am very interested in this program. I read the
information on the FairShare website but didn't get some
answers that I was looking for.... Could you please answer
these questions for me?
We appreciate your feedback and hope to hear
from you often at feedback@fairshare.com.
You do not need to be wealthy to participate. If
you begin planning and budgeting now you will be
surprised at how fast your money can grow. It's all up to you
and the personal commitment that you want to make to your
future. You can learn more about your future potential by
following the link.
We wish you the best fortune in all your financial decisions.
The answers to your questions are as follows.
Question: Are Canadians allowed in your FairShare investment charter
member club?
Yes. We believe that Canadian citizens will
represent a good percentage of our membership.
The growth of the Canadian membership will
directly effect the number of new offering that are
registered with the Canadian regulatory authorities. So we
hope you decide to join and start spreading the word. Also,
please understand that the FairShare membership is made up
of individuals now, and investment clubs and other
organizations later, that are investing independently for their
own account. It is like a big buying club where everyone
receives the benefits of membership but always makes their
own investment decisions.
Question: Does the first $99.00 just get me into the club or does some of
that money get invested in my [investment] account?
No, the $99 is the Charter Membership fee.
FairShare never touches your investment money
nor any stock that you may buy. You keep total
personal control over your financial resources.
Question: Dumb question but that $99.00 is American Money not our
sub-par Canadian dollar, isn't it?
Yes. We can only accept US Dollars at this time.
We feel that the US$99 is an extraordinary value
for an individual who is seriously interested in
starting a long term investment program in
venture capital investing. You might take another look at the
Why Wait page for additional reasons that make the Charter
Membership important for you to consider. There is no reason
not to join as a Regular ($50) or Associate (Free) Member now
and help us build our membership by participating in the
Membership Growth Plan. For details on each
membership.
Question: What is the average amount of money you are looking for me
to put into my account on a monthly basis?
We believe that our average member will set
aside $1 to $5 a day (or $30 to $150 a month) for
their venture capital investments. Investments in
venture capital offering such as FairShare is
proposing will start at $100 and you will be purchasing 50 to
100 shares. A $30 a month plan would allow you to purchase
stock in as many as four young companies a year for starters.
That is one of the most exciting elements of our plan. You
would not normally have this opportunity because neither the
brokers nor the companies, in most instances, are interested
in the average investor (like yourself) that we hold in such high
regard.
What's FairShare all About | Membership | Food Chain | Site
Map | Join Now!
Welcome Letter | FairShare Solution | FAQs| Archives |
Contact us | Disclaimers | Privacy Policy
Copyright © 1998 FairShare. All rights reserved.
Site maintained by webmaster@fairshare.com
|
