AURORA SENTINEL COMMUNITY MEDIA

COMMUNITY SHARES

PURCHASE AND SALE INFORMATION

LEGAL NOTICE AND DISCLAIMERS

These materials relate to the sale by Aurora Sentinel Community Media, a Colorado nonprofit corporation (“ASCM”) of Community Shares in ASCM (“Community Shares”).

Prospective purchasers of Community Shares should carefully consider the information discussed under “Significant Information” below. 

COMMUNITY SHARES DO NOT CONSTITUTE AN INVESTMENT IN “SHARES” OR “STOCK” IN THE COMMON OR LEGAL SENSE OF THE TERMS. PURCHASERS SHOULD NOT PURCHASE COMMUNITY SHARES WITH THE PURPOSE OF MAKING A PROFIT. BECAUSE      OF THE TRANSFER PROHIBITIONS AND CANCELLATION RIGHTS OF THE CORPORATION DESCRIBED IN THESE MATERIALS, IT IS IMPOSSIBLE FOR ANYONE TO REALIZE A PROFIT ON A PURCHASE OF COMMUNITY SHARES OR EVEN TO RECOUP THE AMOUNT INITIALLY PAID TO ACQUIRE SUCH COMMUNITY SHARES.

THE COMMUNITY SHARES ARE NOT SECURITIES, AND CONSEQUENTLY HAVE NOT BEEN APPROVED OR RECOMMENDED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE REGULATORY AUTHORITY NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE REGULATORY AUTHORITY APPROVED THE TERMS OF THESE MATERIALS FOR ACCURACY, THE ADEQUACY OF THIS DOCUMENT OR OTHERWISE.  PURCHASERS OF COMMUNITY SHARES WILL NOT RECEIVE THE PROTECTION OF FEDERAL, STATE, OR INTERNATIONAL SECURITIES LAWS WITH RESPECT TO THE PURCHASE OF COMMUNITY SHARES.

THE COMMUNITY SHARES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD.

The Community Shares are offered subject to ASCM’s right to reject any order in whole or in part and to cancel the sale of Community Shares without notice.

SUMMARY

Background

The Aurora Sentinel

The Aurora Sentinel, in many of its incarnations during the past 116 years, has proudly been the paper of record for the city, Arapahoe and Adams counties and much of the region.

For generations, the Sentinel has been an independent, award-winning source of trusted, fact-based non-partisan news. In January 2023, the Sentinel evolved to become a non-profit company whose sole mission is to sustain the trusted media company for the benefit of the community.  

The Sentinel is the sole source of news dedicated to the extremely diverse and disparate City of Aurora, approaching 400,000 people. The Sentinel has for decades been a source of community news and opinion leader on a vast range of issues, many affecting communities and people far beyond Aurora.

We are a collaborative newsroom among other large and small media outlets across the state, including The Associated Press, The Colorado News Collaborative, The Colorado Media Project and the Colorado Press Association.

The legal structure of the Sentinel company

Aurora Media Group, LLC, a Colorado limited liability company (“Aurora Media Group”), is the owner and publisher of The Aurora Sentinel newspaper.  In May 2022, Joaquin Alvarado organized Colorado Journalism Investment Group, LLC, a Colorado limited liability company (“CJIG”) and purchased all the membership interests in Aurora Media Group.  That transaction closed on June 1, 2022. CJIG transferred all of the membership interests in Aurora Media Group to ASCM on January 1, 2023.       

Aurora Sentinel Community Media

Aurora Sentinel Community Media is a Colorado nonprofit corporation incorporated on September 15, 2022.  ASCM chose to organize as a nonprofit corporation for the following reasons:

●  Nearly all 501(c)(3) charities are organized as nonprofit corporations under state law, AND ASCM filed an application with the IRS on August 19, 2023 to be classified as a tax exempt 501(c)(3) charity.  ASCM has not received a determination letter from the IRS that its application to be recognized as a 501(c)(3) charity has been approved. 

●  Colorado nonprofit corporations, such as the Aurora Sentinel Community Media, do not have shareholders, stockholders or owners of any kind.  While Colorado nonprofit corporations can have members with statutory voting rights under Colorado law, ASCM does not have any members, and the purchasers of Community Shares will not be members under the Colorado Nonprofit Corporation Act.

●  Community Shares are not recognized under the Colorado Nonprofit Sentinel Community Act or otherwise under Colorado law.  They are entirely a creation of ASCM, and they only grant the purchasers the limited rights provided for in ASCM’s Articles of Incorporation and Bylaws, namely the right to attend an annual Community Shareholders’ meeting, to vote to have a Community Director elected to ASCM’s Board of Directors, and to receive select financial information on ASCM.

●  The Community Shares are fundamentally a way for the citizens and supporters of Aurora, Colorado to show their support for The Aurora Sentinel and its mission and service in the community.  ASCM selected the term “Community Shares” because it captures ASCM’s mission of the community and newspaper sharing with and supporting one another through service and resources.

●  While ASCM expect to not lose money, it is not in business to generate profits and returns to investors and owners.

Charitable Activities

●  ASCM is organized and will be operated exclusively for the charitable purposes described under section 501(c)(3) of the Internal Revenue Code.  More specifically, ASCM is organized and operated to strengthen informed participation in local democracy by educating, informing and advancing public discourse through local, independent journalism in and about Aurora, Colorado.

●  As its primary activity, ASCM intends to produce, print, and distribute (both in print and digitally) The Sentinel Newspaper, which will report factual information that is informational and educational to the citizens of Aurora Colorado, and operate in a manner consistent with tax-exempt status under section 501(c)(3). 

Community Shares Sales

The purchase price for Community Shares will be $10.00 per share.

The Community Shares do not constitute an investment in “shares” or “stock” in the common or legal sense of the terms. As detailed under “Significant Information” below, Community Shares do not provide any purchasers with any opportunity to participate in the economic performance of ASCM because, among other things, the nonprofit corporation cannot by law pay dividends or make distributions, including upon liquidation, to the Community Shareholders. Also, as described in “Description of Community Shares—Transfer Restrictions; Cancellation of Community Shares,” ASCM’s Bylaws prohibit the transfer of Community Shares, and ASCM has a right to cancel any Community Shares if any Community Shareholder attempts to transfer his or her Community Shares. As a result, it is impossible for anyone to realize a profit on a purchase of Community Shares or even to recoup the purchase price for such Community Shares.

Aurora Sentinel Community Media

ASCM’s Articles of Incorporation filed with the Colorado Secretary of State (the “Articles of Incorporation”) provide that no Community Shareholder may receive any dividend or pecuniary profit by virtue of being a Community Shareholder in ASCM. In addition, ASCM is required to donate its profit to certain charitable causes, and in the event of a dissolution of ASCM, the profits and assets of ASCM must go to community programs, charitable causes and other similar causes. 

Purpose of the Community Share Sales

The purposes for selling Community Shares are severalfold.  The purchase of Community Shares allows community members to support and share in the sustainability of The Aurora Sentinel.  ASCM will use the proceeds to sustain The Aurora Sentinel’s staff, hire additional staff and provide working capital.  See “Use of Proceeds.”

Purchasers of Community Shares will not participate in ASCM’s economic fortunes. Any operating profits will used to support ASCM and The Aurora Sentinel in furtherance of their charitable mission, and any proceeds upon liquidation of ASCM will go to community programs, charitable causes or other similar causes. As noted above, it is impossible for anyone to recoup the purchase price for Community Shares due, among other things, to transfer prohibitions.

Although Community Shareholders will not receive any economic profit or benefits, Community Shareholders will receive an invitation to ASCM’s annual meeting.

Terms of the Sale of Community Shares

Sales Period                                                           September 1 to December 31, 2023 (subject to extension)

Price Per Share                                                      $10.00    

Use of Proceeds.                                                    ASCM will use the proceeds to sustain the newspaper’s staff, hire additional staff and provide working capital.

SIGNIFICANT INFORMATION

Community Shares Are Not an Investment; No Possibility of Profit

Although ASCM is selling “Community Shares”, prospective purchasers should be aware that Community Shares represent a completely noneconomic purchase for the reasons described below. The best characterization of a purchase of Community Shares is that they represent a contribution to support The Aurora Sentinel.  The purchaser of Community Shares will receive a Community Shares certificate evidencing the purchase and the right to vote at ASCM’s annual Community Shareholders meetings.  The Community Shares do not constitute an investment in “shares” or “stock” in the common or legal sense of the terms because (i) ASCM cannot pay dividends or distribute proceeds from liquidation to Community Shareholders; (ii) Community Shares are not negotiable or transferable; and (iii) Community Shares cannot be pledged or assigned as collateral under ASCM’s Bylaws. COMMUNITY SHARES HAVE NO VALUE, CANNOT APPRECIATE IN VALUE, AND PURCHASERS CANNOT RECOUP THE AMOUNT INITIALLY PAID FOR COMMUNITY SHARES, EITHER THROUGH RESALE OR TRANSFER, OR THROUGH LIQUIDATION OR DISSOLUTION OF THE CORPORATION. See “No Profits or Dividends” and “Transfer Restrictions,” Cancellations of Community Shares.” Therefore, a prospective purchaser should not consider Community Shares to be an investment.

No Securities Law Protection        

Because ASCM believes Community Shares are not “shares” or “stock” for securities laws purposes, it believes purchasers of Community Shares will not receive the protection of federal, state or international securities laws with respect to the purchase or sale of Community Shares. In particular, Community Shares will not be registered under the Securities Act of 1933, as amended, or any state or international securities laws. The Community Shares will not be approved by the Securities and Exchange Commission or any state regulatory authority nor will the Securities and Exchange Commission or any state regulatory authority approve the purchase and sale terms.

No Profits or Dividends      

A holder of Community Shares will not make any profits through dividends or otherwise by virtue of being a holder of Community Shares. The Articles of Incorporation provide that (i) no net earnings of the nonprofit corporation shall not inure or be distributable to any officer, director or private person, and (ii) in the event of a dissolution of ASCM, the assets of ASCM must go to charitable causes and other similar causes. In addition, because ASCM’s Bylaws prohibit transfers of Community Shares to third parties, a holder of Community Shares cannot resell shares to obtain a profit as there will be no market for Community Shares. See “Transfer Restrictions.”

Transfer Restrictions          

Under ASCM’s Bylaws, no Community Shares may be sold, assigned, pledged, or otherwise transferred to a third party.  ASCM’s Bylaws provide that in the event a holder of Community Shares attempts to improperly transfer his or her Community Shares, ASCM has the right, but not the obligation, to cancel such Community Shares.

Cancellations of Community Shares

A Community Shareholder will cease to be a Community Shareholder, will lose all rights as a Community Shareholder and have his or her Community Shares canceled if the Community Shareholder (1) transfers or attempts to transfer any Community Shares, (2) fails to participate and vote in three successive elections to elect a Community Director, or (3) as otherwise may be provided in the Bylaws.  A Community Shareholder whose Community Shares have been canceled may request reinstatement which ASCM’s Board of Directors may authorize in their sole and absolute discretion.

Financial Information          

Community Shareholders will receive notice of ASCM’s annual meeting of shareholders, and an annual report with summary financial information.  In any event, such information has little relevance to a purchaser because a Community Shareholder will not receive any dividends in respect of, and cannot make any profits through ownership of Community Shares.

If the IRS accepts ASCM’s application to be treated as a 501(c)(3) tax exempt charity, then a purchase of Community Shares will not constitute a charitable contribution for federal or state income tax purposes.

Voting Rights

Each Community Shareholder will only be entitled to one vote regardless of the number of Community Shares owned.

Election of Community Director    

Purchasers of Community Shares will play a key role in facilitating the continued viability of the Aurora Sentinel and will have the opportunity to have a voice in ASCM’s governance. Community Shareholders will receive an invitation to ASCM’s annual meeting and have the opportunity to vote for at least one director to the Company’s Board of Directors.  However, such election will not be direct as only ASCM’s Board of Directors can elect Directors to the Board under ASCM’s Bylaws.  However, the Bylaws provides that the Board will appoint the individual(s) elected by the Community Shareholders for the Board so long as such individuals meet the same requirements for all Directors.  ASCM’s Bylaws contain certain procedural requirements for Community Shareholders who wish to nominate a candidate for consideration by the Community Shareholders and the Board of Directors.

As a nonprofit corporation, ASCM does not have any actual shares of stock or owners in any common or legal sense.  The “Community Shares” and “Community Shareholders” are entirely a creation of ASCM under its Bylaws and are not recognized under the Colorado Nonprofit Corporation Act or otherwise under Colorado law.

Other Matters

Purchasers of Community Shares will not receive any discounts, services or goods (other than a Community Shares certificate).

TERMS OF THE SALE

Price, Payment and Delivery          

ASCM is selling Community Shares at a price $10.00 per share.

No one may purchase Community Shares without receiving or viewing these purchase and sales material online.  A purchaser may purchase Community Shares online or by mail.

Online

A purchaser may purchase Community Shares online by credit or debit card by going to www.SentinelShares.com and properly completing the Purchase Agreement. We encourage you to use this method as it saves paper and time, and it is the only way to purchase by credit or debit card.

By Mail

You may also choose to purchase by mail using cashier’s checks or personal checks by properly completing the Purchase Agreement (including Signature Page and Order Form), which is the form attached as the last pages of this Purchase and Sale Packet. For those purchasing by mail, the full Purchase Agreement and accompanying payment for Community Shares being purchased should be mailed or delivered directly to The Sentinel 2600 S. Parker Road Suite 4-141 Aurora, CO 80014. You may not use the mail to purchase by credit or debit card. Credit card purchase can be made by calling 303-750-7555 or by going to www.SentinelShares.com

Purchase Acceptance

All purchases must be made in U.S. dollars paid by credit or debit card, ACH bank transfer, other electronic transfers (Venmo, Apple Pay, etc.) cashier’s checks or personal checks drawn on U.S. banks payable to “Aurora Sentinel Community Media.” Third-party checks will not be accepted. In addition, please do not send cash. If you pay by credit card, debit card, or ACH bank transfer, then you may only purchase online by completing your Purchase Agreement online at www.sentinelshares.com. If you pay by cashier’s check or personal check, then you may only purchase by mail. If you pay by personal check (rather than a cashier’s check), then ASCM will not process your order until it has received funds from your bank, which typically takes approximately five business days. There will be a $50.00 charge if a personal check is returned due to insufficient funds.

ASCM will process the Purchase Agreement and deliver Community Shares certificate to the purchaser or the recipient (for a gift to a minor, the recipient will be the custodian) as indicated. ASCM estimates that processing and shipping time will take at least four weeks, especially during the heavy holiday mail season. ASCM will forward certificates by trackable mail after completion of processing. You will receive a shipping confirmation by email when the Community Share      certificate is mailed.

Online submission is recommended for most efficient processing.

USE OF PROCEEDS

The purchase price and handling fee for the Community Shares will be deposited in ASCM’s general operating account and used for the following purposes:  First, it will assist the newspaper to sustain its staff with livable wages.  Second, it will facilitate hiring additional staff to support the newspaper and organization.  Third, it will provide the Community Sentinel with some much needed working capital. 

  QUESTIONS/ADDITIONAL INFORMATION

The following summarizes in question-and-answer format certain information contained in these purchase and sale materials. These questions and answers only summarize portions of the rest of these materials. Please review the entire document, especially the “Significant Information” section.

Q.    How much do Community Shares cost?

A.    Community Shares cost $10.00 per share.

Q.    How long will the sale of Community Shares be open?

A.    ASCM intends to offer Community Shares until December 31, 2023 (subject to extension).

Q.    May I purchase more than one Community Share at a time?

A.    Yes.

Q.    May I purchase Community Shares with another person?

A.    You may purchase Community Shares with your spouse or civil union partner with the Community Shares to be registered as joint tenants. You may not otherwise purchase a Community Share with another person.

Q.    If I purchase Community Shares, will I be able to resell or transfer the shares to other people?

A.    No. You cannot sell, assign or otherwise transfer Community Shares to a third party, including family members.

Q.    Will I receive a tax deduction for purchasing Community Shares?

A.    Yes. ASCM has filed an application to be recognized as a tax-exempt 501(c)(3) charity.  Purchasers will be able to receive a charitable tax deduction upon approval of the application by the IRS.    

Q.    Will I receive any special benefits by purchasing Community Shares?

A.    No. You will not receive any special benefits, including discounts or other promotions.  You will receive an invitation to the annual meeting, the right to vote for one or more Community Directors, and receipt of select financial information.

Q.    How many votes will I receive for purchasing Community Shares?

A.    You will have one vote for electing a Community Director regardless of the number of Community Shares you purchase.

Q.    How do I purchase Community Shares?

A.    You may purchase Community Shares immediately by properly completing the Purchase Agreement online at www. SentinelShares.com or you may complete pages P-1 through P-3 at the end of this document and mail the full, completed Purchase Agreement, including payment, to ASCM. But, if you pay by credit card, debit card, or ACH bank transfer, then you may only purchase online.

Q.    Where do I send the Purchase Agreement?

A.    If you purchase by mail rather than online, you should mail the Purchase Agreement (including Signature Page and Order Form) and payment.

Q.    How can I pay for Community Shares?

A.    All purchases must be made in U.S. dollars. Purchases online may be paid by credit or debit card or with ACH bank transfer. Purchases mailed in can be paid with cashier’s checks or personal checks drawn on U.S. banks payable to “Aurora Sentinel Community Media” Third-party checks will not be accepted. Please do not send cash.

Q.    May I pay with a personal check?

A.    Yes, if you are ordering by mail, but there will be a delay in processing the Purchase Agreement (including Signature Page and Order Form) if you do so because ASCM will not process your order until it has received funds from your bank, which takes approximately five business days.

Q.    How will the shareholder certificates be delivered to me?

A.    ASCM will mail the Community Share certificates to the address provided by the purchaser in the Purchase Agreement.       

Q.    How can I make gifts of Community Shares?

A.    If you desire to purchase Community Shares for others, you may easily do so online at www.SentinelShares.com.

       If you have additional questions concerning anything in these materials, the Community Shares, the purchase and sale terms or the attached Purchase Agreement, you may contact              Publisher Dave Perry at 303-750-7555.

PURCHASE AGREEMENT

{AURORA SENTINEL LOGO}

DIRECTIONS

For the most efficient method of completing your Purchase Agreement, please go online to www.SentinelShares.com and fill in and complete all applicable information.

To complete by mail, please fill in and complete all applicable information, sign, date, and return with the accompanying payment using a cashier’s check or a personal check payable to Aurora Sentinel Community Media and mailed or delivered to 2600 South Parker Road, Suite 4-141, Aurora, CO 80014.

NOTE: If you are ordering by mail, you must remove and send, along with payment, all 3 pages of the Purchase Agreement (fully completed, including signature).

Ladies and Gentlemen:

By executing this Purchase Agreement, I irrevocably purchase the number of Community Shares of Aurora Sentinel Community Media, a Colorado nonprofit corporation (the “Sentinel Community”), set forth below (“Community Shares”) at a purchase price per Community Share of $10.00 per share.        

As an inducement to ASCM to accept this purchase, I hereby represent, warrant and covenant to ASCM that:

1.          I am submitting this Purchase Agreement subject to the terms set forth in the Purchase and Sale Packet.

2.          I have received, carefully read and reviewed the purchase and sale materials, , including particularly the section of the document entitled “Significant Information.” I am entering into this Purchase Agreement with full knowledge and understanding of the purchase of Community Shares that this Purchase Agreement contemplates.

3.          In making this purchase, I have relied solely upon the materials in the Purchase and Sale Packet and my own independent knowledge of ASCM, and I have not relied upon any other materials or oral representations.

4.          I understand that a purchaser or holder of Community Shares will not be able to make any profits through dividends or otherwise by virtue of being a holder of Community Shares. In addition, I understand that Community Shares do not constitute an investment in “shares” or “stock” in the common or legal sense of the terms and that ASCM believes I will not receive the protection of federal, state or international securities laws.

5.          I understand that, pursuant to ASCM’s Bylaws, I cannot transfer Community Shares and that my Community Shares will be cancelled if I transfer or attempt to transfer my Community Shares.

6.          I am subscribing for the Community Shares to support the continued viability of ASCM as a community resource without expectation of any economic profit. The only benefits I will receive from my purchase are the continued viability of a community newspaper and the opportunity to have a voice in its governance by voting for at least one Community Director to serve on ASCM’s Board of Directors.

7.          I understand and agree that the certificate(s) representing the Community Shares will include a restrictive transfer legend.8.          This Purchase Agreement is governed by and construed in accordance with the internal laws of the State of Colorado.

By providing payment for shares via credit card, wire, bank transfer, check or any other instrument, you agree to above terms of the share sale.