Offering Closing Process #

Key Stages #

Investor commited their interests and Agreement Signatures Investors sign investment agreements outlining the terms and conditions of their investment, solidifying their commitment to participate in the offering.
Completion of 100% Offer Subscriptions This stage signifies the achievement of full subscription commitments from investors, ensuring that the offering has reached its intended financial support target.
KYC and Accreditation Verification Before proceeding with payments, each investor undergoes Know Your Customer (KYC) and accreditation verification to comply with regulatory requirements and confirm their accredited status.
Initiation of Payments Successful verification initiates payments, transferring the agreed-upon investment amount to the designated escrow account through various payment methods.
Funds Deposition in Escrow Account Upon receipt, the invested funds are securely held in an escrow account managed by a neutral third party until all conditions for their release are met, providing assurance to both investors and the issuing company.
Release of Funds to Company Accounts Once all conditions are fulfilled, the funds held in escrow are released and transferred to the designated company accounts, enabling access to the raised capital for intended purposes.
Post-Closing Reporting to Investors Comprehensive post-closing reporting is provided to investors, including detailed information on the offering’s performance, financial results, and use of funds, fostering transparency and trust between the company and its investors.
Distribution Period Commencement Following the offering’s closure and fund release, the distribution period begins, allowing investors to receive returns on their investments, such as dividends or interest payments, and realize the financial benefits over time.

Steps from the system perspective #

From the system’s perspective, the closing process is a comprehensive journey that begins when the offer status transitions from Published to “Published with 100% Subscription”.
The administrator ensures that all investment agreements are signed by the investors.
The system verifies that all profiles participating in the investment undergo Know Your Customer (KYC) and accreditation checks. Once all profiles are KYC and accreditation verified, it translates into all investments being in legally confirmed statuses, ensuring regulatory compliance and mitigating risks.
The system monitors the completion of payments for all investments. Expected funding staus for all successful investments is Received. This entails ensuring that funds are successfully transferred from investors’ accounts to the designated escrow account, marking the completion of investments and indicating that all trades are Funded on the North Capital end.
Upon reaching these milestones, the administrator gains the ability to transition the offer status from “Published” to “Legally Closed.” This transition signifies the formal closure of the offering, indicating that all necessary steps have been taken to fulfill regulatory requirements and secure investments.
Once the offering is “Legally Closed”, the administrator can further transition it to “Successfully Closed.” This final status indicates the successful completion of the offering. At the same time Escrow release happens and funds are moved to company’s account. Expected funding staus for all successful investments is Settled.

Note: in cases where a deal is being closed unsuccessfully, the administrator retains the flexibility to initiate the closure process regardless of the current offer status.

Offer& investments statuses during closing #

An offer is closed once an admin user updates its status to SUCCESSFULLY_CLOSED or UNSUCCESSFULLY_CLOSED.
An offer cannot be closed successfully if it contains investments with CONFIRMED status, unapproved KYC/Accreditation for any investment profile associated, or if there are unpaid or failed payments for investments.
Once an offer is closed, all associated investments are also closed, with outcomes being either successful or unsuccessful, depending on the closing status of the offer.
If an offer is closed unsuccessfully, it is removed from the platform, and investments are removed from the investors’ Portfolio. Investors receive notifications about the unsuccessful closure.
The status of an offer cannot be changed once it has received one of the two possible *_CLOSED statuses.
Users can view a list of their successfully closed investments in their Portfolio. All offer details remain accessible to investors.