Equity Investors Incentive

Who is eligible?

The Equity Investors Incentive is aimed at businesses in Prince Edward Island that are seeking investment to support their expansion and operations. The following criteria determine which businesses can apply:- They must be a taxable, private Canadian corporation.- They should be registered to do business in Prince Edward Island.- The head office and primary business operations must be located in Prince Edward Island.- The business needs to have been operational in Prince Edward Island for at least one year.- They should provide exportable goods or services in designated strategic sectors, including bioscience, aerospace and defence, advanced manufacturing and processing, renewable energy and clean technology, information and communications technology, creative and cultural industries, or offer first-of-its-kind exportable goods or services in other sectors.- At least 75% of their payroll should be paid to employees residing in Prince Edward Island.- The business must have fewer than 50 employees and assets less than $10 million.- They must ensure compliance with securities legislation and not have any defaulted outstanding debt obligations with the Government of Prince Edward Island's Central Default Registry.- They need to demonstrate a well-developed business plan and appropriate use of funds for expansion and/or ongoing operations in Prince Edward Island.

Who is not eligible

This grant excludes certain individuals and organizations based on their relationship or existing financial obligations with the investee company or Provincial Government. Specific restrictions are detailed to ensure compliance with the grant's objectives.

• An individual or company that is a current or previous shareholder of the investee company.
• Those related to the investee company as defined under section 251 of the Income Tax Act.
• Entities with a defaulted outstanding debt obligation on file in the Government of Prince Edward Island Central Default Registry.
• Venture capital organizations that have received financial contributions from the Province of Prince Edward Island.
• Companies receiving funding support from Innovation PEI.

Eligible expenses

The eligible expenses for this grant focus on the appropriate use of funds raised to support business activities and improvements.

• Reduction of requirements for conventional term debt and working capital financing.
• Support for business expansion or diversification.
• Product development or commercialization of new technology, products, or processes.
• Injection of technical or managerial expertise.

Eligible geographic areas

This grant is specifically available to businesses with their primary operations in Prince Edward Island, Canada. It aims to boost private sector investment and support the economic growth of this region.

• Businesses located in Prince Edward Island, Canada.

Additional considerations are important for applicants of the Equity Investors Incentive program:

• Compliance with Prince Edward Island securities legislation is crucial; investee companies must secure an opinion from a qualified legal practitioner to confirm their adherence to these laws.
• Investee companies should anticipate a four-year commitment from investors, as incentives could be reclaimed if shares are redeemed within this period.
• The program necessitates detailed performance monitoring, requiring annual submissions of financial statements and updates on shareholder transactions.
• Careful consideration should be given to the use of raised funds; prohibited uses include paying dividends or acquiring unrelated securities.
• Innovation PEI reserves the right to reclaim funds from investee companies that fail to comply with program guidelines or cease operations.