4ORM FINANCE
PRE-SEED DATA ROOM · CONFIDENTIAL
10.2

Indicative Responses
to Common Asks

Short, direct answers to the questions that come up in nearly every investor conversation: terms, timeline, structure, eligibility, and what happens next.

PREPARED BY
4orm Finance · Founders
ROUND STATUS
Pre-Seed $3M
Opens July 1, 2026
CATEGORY
10 · Diligence
Document 10.2
UPDATED
June 2026
1.0
THE ROUND
AT A GLANCE

These are indicative responses, written to answer quickly and consistently. Anything here that bears on a decision should be confirmed against the definitive documents in the 09 Fundraise and 08 Corporate folders, which govern.

ASKINDICATIVE RESPONSE
What are you raising?$3M pre-seed, $10M pre-money
When does it open?July 1, 2026
Minimum raise?$3M minimum
What is the instrument?Priced unit offering: each $1,000 unit = 1 redeemable preferred ($500 face) + 1,000 common ($500 at $0.50) + a half warrant at $1.50
Already committed?$300K ($50K angel + $250K first tranche)
Investor protections?NVCA-aligned: 1x non-participating preference, broad-based weighted-average anti-dilution, pro-rata, information rights
Tax treatment?BC EBC 30% tax credit; structured for TFSA / RRSP eligibility
WHERE THIS IS GOVERNED

The definitive round terms, unit composition, and redemption schedule are in the Capital Structure Memorandum (document 08.1) and the 09 Fundraise documents. This page is a convenience summary, not an offer; the subscription documents prepared with Capiche govern any investment.

2.0
STRUCTURE & TERMS
Why a unit offering instead of a plain preferred round?
Because the round is being placed through the Canadian resource and capital-markets network, where the unit structure (preferred + common + warrant) is the conventional instrument. It gives investors a quasi-debt redeemable component, a common-equity slice, and a warrant kicker in one package.
How does the preferred redeem?
Out of company revenues beginning in Year 2, at 10% of revenues per year, with a 3% premium accruing per year on the unpaid balance. It is a real ongoing claim on cash flow, and the five-year model (document 05.1) is built to service it without starving the build.
What is the valuation based on?
$10M pre-money sits in the upper tier of Canadian pre-seed. It is justified by the regulated-infrastructure category, the operating-grade product (the 4ormEx exchange and institutional demo), the multi-entity structure required by CIRO, and alignment to Bank of Canada Project Samara, and it is a number we are prepared to defend in conversation, not assert. Benchmarks are in document 08.1.
How much dilution to existing holders?
13.04% common dilution at close, 15.79% fully diluted if warrants are exercised. The founder bloc holds roughly 95% of votes post-raise via the tiered structure. Full cap table is document 08.2.
Is there a board seat?
Investor governance follows the Shareholders' Agreement and the protective provisions noted above; the Investment Committee is created at the pre-seed close. Specific board composition is set in the definitive documents.
3.0
USE OF PROCEEDS & TIMELINE
What does the money do?
It funds the build window: senior engineering and compliance leadership, the regulator-aligned sandbox pilot, the first institutional integrations, and the legal and regulatory process. The build is deliberately sequenced behind the first close. Detailed use of proceeds and milestone gates are in the 09 Fundraise documents.
What is the timeline to revenue?
The model books zero revenue in the 2026 build half-year, then revenue begins as ATB and Bow Valley onboard in 2027 and compounds as Vancity and Servus join in 2028. The clock starts at first close. The 30-60-90 plan (document 03.5) and the roadmap (document 03.6) detail the sequence.
What is the next round, and when?
A seed round is contemplated for 2027, "seed-strapping" in the $15M to $25M range, likely via a US entity, with terms announced following MOU conversion and a lead-investor process. The post-seed dilution shown in the cap table is illustrative, not a term sheet.
Is there non-dilutive capital in the plan?
Yes. $2.23M of scheduled non-dilutive capital is mapped across 170-plus programs (IRAP, SR&ED, Alberta Innovates, PrairiesCan, Digital Supercluster, Mitacs and others), roughly 74% of the size of the round itself. It is in the five-year model and reduces dependence on any single financing.
4.0
ELIGIBILITY & PROCESS
Who can invest?
The round is placed under Canadian exempt-market rules (NI 45-106). Eligibility, including accredited-investor and other exemptions, is confirmed through the subscription process prepared with Capiche. The BC EBC structure is designed to deliver a 30% tax credit and TFSA / RRSP eligibility to qualifying BC investors.
How do I actually subscribe?
Through the subscription documents and financing platform managed by Capiche. The data room is the diligence layer; the subscription package is the legal layer. The fastest path is to email the founders directly to begin the process.
What is the minimum cheque?
Minimum subscription is set in the subscription documents. The unit price is $1,000 per unit; cheque-size minimums and any per-investor limits follow the exempt-market framework and are confirmed during onboarding.
Can I do additional diligence beyond this room?
Yes, and we encourage it. This room is built to be argued with: the model is fully visible (document 05.1), the SWOT names its own risks (document 10.4), and the hard questions are answered directly in document 10.1. Management calls, reference checks on the advisory bench, and counsel-to-counsel review are all welcomed.
NEXT STEP

The founders read every access request and every introduction personally. To begin a subscription, request a management call, or raise a question this room does not answer, email founders@kcs-capital.com. The round opens July 1, 2026.

Indicative responses prepared by the founders as of June 2026 for convenience only. They do not constitute an offer to sell or a solicitation to buy securities; any investment is made solely through the definitive subscription documents, which govern. Forward-looking statements are subject to material change.

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NOT FOR DISTRIBUTION

Prepared for approved data room members. This document does not constitute an offer to sell securities or a solicitation of an offer to buy securities. 4orm Finance Holdings Inc. is the parent entity of 4orm OpCo, 4ormEx OpCo, and 4orm Trust Co; technology is developed by KCS Capital, an independent research and development firm.