Standing Stone One
CONFIDENTIAL OFFERING MEMORANDUM

No securities regulatory authority has assessed the merits of this Offering Memorandum or reviewed this Offering Memorandum.  Any representation to the contrary is an offense.

The information disclosed on this page is a summary only.  Purchasers should read the entire Offering Memorandum for full details about the offering.

This is a risky investment.  You could lose all the money you invest.

 

Dated:                                                    June 18, 2008

 

The Issuer:

Name:                                                    Standing Stone Redwater Limited Partnership (the “Partnership”)                          

Head Office:       

Address:                                1920, 10020 – 101A Avenue

                                                Edmonton, Alberta

                                                T5J 3G2

                Phone Number:                    (780) 421-0044

                Fax Number:                        (780) 421-0069

                E-mail address:                    casey@obyrnegroup.ca    

               

The Offering:

Securities Offered:                               Limited Partnership Units (the “Units”).

 

Price Per Security:                                $12,500      

 

Minimum/Maximum Offering:        Minimum $12,500 (1 Unit) (fully paid)/Maximum $900,000 (72 fully paid Units).  You may be the only purchaser.

                                                               

Minimum Subscription Amount:     Each subscriber will be required to purchase a minimum of 1 Unit for a minimum aggregate subscription price of $12,500.00.

 

Payment Terms:                                  Subscription funds are to be made payable to “Chamberlain Hutchison in trust” and are to be provided to the Corporation together with the completed subscription documents. In addition, for each full Unit subscribed and paid for, the subscribe will have the right to subscribe for three-quarters (3/4) of a Unit (a “Debt Unit”) to be paid by way of a non-recourse promissory note having the terms described under Item 5.

 

Proposed Closing Date:                      October 31, 2008.  The closing (or closings) may take place prior to or after this proposed closing date, as the Corporation determines.

 

Tax Consequences:                            There are important tax consequences to these securities.  See item 6.

 

Selling Agent:                                       The Partnership has not designated a selling agent, but will pay finder’s fees of up to 10% of the subscription amount (including the subscription amount of the Debt Units subscribed for) to persons authorized by the Partnership to sell Units.  See Item 7.

 

 

Resale Restrictions:

You will be restricted from selling your securities for an indefinite period.  See Item 10.

 

Purchaser’s Rights:

You have 2 business days to cancel your agreement to purchase these securities.  If there is a misrepresentation in this Offering Memorandum, you have the right to sue either for damages or to cancel the agreement.  See Item 11

 

ITEM 1.          USE OF NET PROCEEDS

 

The net proceeds of the offering and the funds available to the Corporation after this offering are as follows:

 

 

(1)           This figure represents the commission on the fully paid units.  Payment of the commission on the Debt Units will be deferred until funds are available from other sources, such as payment for Debt Units, interest payments received , debt financing or available working capital.          

 

The net proceeds are intended to be used as follows:

 

 

 

We intend to spend the net proceeds as stated.  We will reallocate funds only for sound business reasons.

 

If less than the maximum offering is achieved the Corporation proposes to fund its short term objectives through secured debt financing, using the Property as security.

 

ITEM 2 BUSINESS OF STANDING STONE REDWATER LIMITED PARTNERSHIP

 

Structure

 

Standing Stone Redwater Limited Partnership (the “Partnership”) was formed on December 20, 2007, as a limited partnership by the filing of a certificate of limited partnership pursuant to the Partnership Act (Alberta).  The Partnership is governed by the terms of the limited partnership agreement (the “Limited Partnership Agreement”) to be entered into by all subscribers.  A copy of the Limited Partnership Agreement is attached as Schedule “A” to this Offering Memorandum.

 

In this Offering Memorandum references to “we”, “our” and “us” mean Standing Stone Redwater Limited Partnership.

 

The general partner of the Partnership is Standing Stone GP I Ltd. (the “General Partner”).  The General Partner was incorporated pursuant to the provisions of the Business Corporations Act (Alberta) on December 13, 2007.  The registered office of the General Partner is Suite #155, 10403 – 122 Street, Edmonton, Alberta, T5N 4C1. 

 

Our Business

 

The Partnership was formed for the purpose of acquiring and developing the Property (described below).  The Partnership completed an initial offering of Units to raise sufficient funds to permit the Partnership to complete the purchase of the Property, as described below.

 

The Partnership entered into an agreement to purchase the property (the “Property”) being an approximately 79 acre parcel of land legally described as:

 

The North East quarter of Section twenty (20)

Township fifty seven (57)

Range twenty one (21)

West of the Fourth Meridian,

containing one hundred and sixty (160) acres more or less,

 

Excepting thereout: 

 

A)                All that portion described as follows:  commencing at the north east corner of the said quarter section, thence westerly along the north boundary thereof three hundred and ninety (390) feet, thence southerly and parallel to the east boundary of the said quarter section one hundred and ninety five (195) feet, thence easterly and parallel to the said north boundary to a point in the said east boundary, thence northerly along the said east boundary to the point of commencement.

Containing 0.704 Hectares (1.74 acres).

B)                 Plan 0823542 Subdivision.  Containing 32.2 Hectares (79.82 acres).

 

Excepting thereout all mines and minerals

 

The Property was previously owned by Thomas Walker and Joanne Walker, who acquired the Property in 1959.  Mr. & Mrs. Walker are at arms’ length to the Partnership.  Pursuant to a commercial real estate purchase contract dated July 10, 2007, Mr. & Mrs. Walker agree to sell the Property to Casey O’Byrne for a purchase price of $1,840,000.  Mr. O’Byrne entered into an agreement to transfer the Property to the Partnership for a purchase price of $2,400,000.  Mr. O’Byrne assigned his interest under these agreements to Standing Stone Development Corp., which is the parent company of the General Partner. 

 

The Partnership completed the purchase of the Property on May 1, 2008, by a cash payment of approximately $1,750,000 (subject to property tax adjustments) and $650,000 by way of a promissory note, bearing interest at an annual rate equal to the prime lending of Alberta Treasury Branches (ATB Financial), from time to time, plus 2%, payable on the earlier of May 1, 2010 or the date of the sale of the Property by the Partnership, which Standing Stone Development Corp may secure by a charge on the Property.  Mr. O’Byrne advanced the amount of $175,000 to the Partnership to permit it to pay the required cash portion of the purchase price for the Property, which amount is secured by a demand promissory note bearing interest at an annual rate equal to the prime lending of Alberta Treasury Branches (ATB Financial), from time to time, plus 2%.  $75,000 of this note has been repaid to date.  Mr. O’Byrne is not at arms’ length to the Partnership as he is the director, officer and sole beneficial shareholder of the General Partner.  Depending on the amount of money raised under this offering, the Partnership intends to repay the demand promissory note to Mr. O’Byrne.

 

The Property is located in the Town of Redwater, in the Province of Alberta, on the south side of highway 644, approximately 1 km west of Main Street in Redwater.  The Property consists of approximately 79 acres.  It is presently undeveloped farm land.

 

The Partnership has taken steps to enable the Property to be developed and subdivided to permit individual commercial lots to be sold as an Eco-Industrial Park.  A portion of the Property has been zoned as highway commercial, and the remaining portion zoned as light industrial.  Achieving this objective may require applying for municipal approvals for subdivision and/or development.  Obtaining those approvals may require a number of studies, including engineering and environmental studies.

 

The Partnership will also consider obtaining reasonable offers for the entire Property prior to the subdivision.  While the Property is expected to have a greater value after subdivision, there are additional risks and costs associated with the subdivision and development process that may make a lower offer prior to subdivision more attractive.

 

After obtaining required approvals, the Partnership intends to subdivide and develop the Property and proceed with the sale of the individual lots that will comprise the subdivided Property.  It is anticipated that it will cost approximately $200,000 to obtain the required municipal approvals.  It is anticipated that the Partnership will not be required to prepare an area structure plan for the development, however, should that be required it is anticipated will cost about an additional $50,000.   Development of the Property, which would require the construction of roads and installation of services, is estimated to cost approximately $6,500,000; however, at this early stage this estimate may be subject to significant variation.  It is anticipated that funding for these costs would be obtained through debt financing secured by a charge on the Property.  In addition, the General Partner may arrange secured debt financing to cover the operating and other costs of the Partnership if this offering is not fully subscribed.

 

The Property is subject to the following encumbrances on its title, which are expected to remain in place:

 

 

The Property is presently used by the current owners as a residence and for agricultural purposes.  The Property was recently annexed into the Town of Redwater.  The Property has been rezoned and as a result, the Property is considered suitable for highway commercial and industrial development. The front 150 meters adjacent to Highway 644 has been zoned highway commercial (C-3) along Highway 644 and the back portion has been zoned light industrial (M-1). As there are a number of pipelines in the area the Property is not considered suitable for heavy industrial development.

 

At the present time gas and power are available on the Property.  The Property is not presently serviced by sewage lines, and it is anticipated that these services will need to be arranged by the Partnership to proceed with the development of the Property.

 

The Town of Redwater is located in the area known as Alberta’s “Industrial Heartland”.  Redwater, in the area of Sturgeon County, is about a 30 minutes drive northeast of Edmonton, Alberta on the route from Edmonton to Fort McMurray.  There have recently been announced several proposed bitumen upgraders in Sturgeon County that are estimated to have construction costs totaling approximately $40 billion.  These proposed developments are expected to create a significant demand for industrial commercial space.

 

The General Partner proposes to develop the Property as an Eco Industrial Park, incorporating environmental planning in the development process.  The proposed development will include elements if the following environmental considerations:  Environmental Stewardship, Solar Paneling , Geo Thermal Heating, Water Catchments, Recycling Business Cluster, Local Waste Exchange, Roof Gardens, Indigenous Landscaping, Berming, Gray Water Recycling, and an overall “green” Philosophy

 

Terms of Standing Stone Redwater Limited Partnership

 

The terms of Standing Stone Redwater Limited Partnership are as set out in the Limited Partnership Agreement attached as Schedule "A" to this Offering Memorandum.  The following discussion is a summary of some of the principal terms of the Limited Partnership Agreement.  All subscribers should review the terms of the Limited Partnership Agreement carefully and should review the same with their professional advisors.

 

The capital of the Partnership will be divided into an unlimited number of Units.  The Units will be issued for a capital contribution of in an amount determined by the General Partner from time to time.  For this Offering Memorandum the Units will be issued for the amount of $12,500 per Unit.  Standing Stone Development Corp. (the parent company of the General Partner) has purchased 90 Units for the price of $100 per Unit.  In addition, under a previous offering memorandum the Partnership issued a total of 133 fully paid Units at a price of $12,500 per Unit and 99.75 Debt Units.  The General Partner shall have the unfettered discretion to accept subscriptions for Units and to determine when, how and to whom to issue Units and on what terms.

 

The expenses of the Partnership will be allocated on a proportionate basis among the Units based upon the number of Units outstanding.  A distribution of earnings and capital of the Partnership to the holders of Units will be done on a proportionate basis, based on the number of Units outstanding. 

 

The management of the Partnership shall be vested in the General Partner, which shall have the authority to conduct the business of the Partnership, including all decisions respecting the development and sale of the Property.  The General Partner shall have the authority to retain agents, employees or contractors to carry out the business of the Partnership, and to delegate its authority to such persons (provided that no such delegation shall relieve the General partner of its obligations.  The General Partner shall be reimbursed for all expenses incurred in conducting the business of the Partnership, but shall not otherwise be compensated in its capacity as General Partner.

 

 

Long Term Objectives

 

Our long term objectives are to complete the subdivision and development of the Property and to sell the Property.

 

Short Term Objectives and How We Intend to Achieve Them

 

 

Insufficient proceeds

 

If less than the maximum subscription is obtained, the net proceeds of this offering will be insufficient to meet all of our proposed short-term objectives and there is no assurance that additional financing will be available.

 

Material Agreements

 

The Corporation has entered into contracts material to investors as follows:

 

1.                  Limited Partnership Agreement dated December 20, 2007.

 

2.                  Real Estate Property Agreement dated December 20, 2007, between the Partnership and Casey J. O’Byrne.  See “Our Business”

 

ITEM 3.          DIRECTORS, MANAGEMENT, PROMOTERS AND PRINCIPAL HOLDERS OF GENERAL PARTNER

 

Compensation And Securities Held

 

The following table sets out the shareholdings and compensation of each director, officer, and promoter of the General Partner and each person who directly or indirectly beneficially owns or controls 10% or more of the outstanding voting securities of the General Partner.

 

 

(1) Includes shares held indirectly.  Mr. O’Byrne owns all the outstanding shares of Standing Stone Capital Ltd., which company owns all the outstanding shares of Standing Stone Development Corp, which owns all the outstanding shares of Standing Stone GP I Ltd.

 

The following table sets out the Principal Holders of Units of the Partnership.

 

Name and municipality of principal residence	Number and percentage of Units held as at June __, 2008	Number and percentage of Units held after completion of minimum offering(2)	Number and percentage of Units held after completion of Maximum offering(2)
Standing Stone Development Corp.(1)	90 Units (27.9%)	90 Units (27.7%)	90 Units (20%)

 

(1)                 Standing Stone Development Corp, is a private company controlled by Casey J. O’Byrne of Edmonton, Alberta.

(2)                 Assumes that all subscribers fully exercise the right to subscribe for Debt Units.

 

Management Experience

 

The following table sets out the principal occupations and related experience of the director and senior officer of the General Partner over the past 5 years.

 

 

The Partnership has established an Advisory Committee to provide the General Partner with guidance and support.  The Advisory Committee will make non-binding recommendations to the General Partner respecting the business of the Partnership.  The members of the Advisory Committee are appointed by the General Partner. 

 

The Members of the Advisory Committee and summaries of their related experience are as follows:

 

 

 

 

Penalties, Sanctions and Bankruptcy

 

In the past 10 years none of the directors, executive officers or control persons of the Partnership or the General Partner, nor any issuer of which any such person was a director, executive officer or control person, have been subject to any penalty or sanction or any declaration of bankruptcy, voluntary assignment in bankruptcy, proposal under any bankruptcy or insolvency legislation, proceedings, arrangements or compromises with creditors or appointment of a receiver, receiver manager or trustee to hold assets. 

 

ITEM 4.          CAPITAL STRUCTURE

 

Share Capital of Partnership

 

 

(1)     Includes Debt Units.

(2)     Assumes that all subscribers fully exercise the right to subscribe for Debt Units.

 

Long Term Debt

 

(1)                 The Partnership intends to repay this demand promissory note with the proceeds of this offering.

 

Prior Sales

 

The Partnership has not issued any Units or other securities convertible into Units within the last 12 months, except as follows:

 

Date of Issuance	Type of Security Issued	Number of Securities Issued	Price per Security	Total funds received
December 20, 2007	Units	90(1)	$100	$9,000
April 30, 2008	Units	133	$12,500	$1,662,500
April 30, 2008	Debt Units	99.75	$12,500	75,000(2)

(1)     Units issued to the General Partner.

(2)     The Partnership did not initially receive cash proceeds from the sale of Debt Units, but received promissory notes in the aggregate principal amount of $1,246,875.  The Partnership has since received full payment for 6 Debt Units in the amount of $75,000.

 

ITEM 5.          SECURITIES OFFERED

 

The securities offered are Units of the Partnership.  Each Unit is entitled to have allocated to it its proportionate share of the profits and losses of the Partnership and to participate on a proportionate basis in any distribution of the property of the Partnership, whether upon dissolution or otherwise.  The holders of Units as such, have no right to participate in the management of the Partnership.  The Partnership Act (Alberta) provides that the liability of limited partners is limited to the unpaid amount of their contribution, unless they take part in the control of the business of the Partnership, in which case they will have unlimited liability as if they were a General Partner. 

 

Where Units have not been fully paid for, funds otherwise distributable to the holders of such Units will be applied firstly to payment of the outstanding purchase price therefor.

 

In the event that the General Partner presents any matters to the limited partners for their approval, each Unit will carry one vote, but fractional Units shall have no voting rights.  The General Partner is not required to obtain approval of the limited partners for any matter except approval of a new general partner in the event that the General Partner resigns.

 

Subscription Procedure

 

In order to subscribe for Units subscribers will be required to make payment of the subscription price payable to Chamberlain Hutchison in trust and deliver the same to the Chamberlain Hutchison at #155, 10403 – 122 street, Edmonton, Alberta, T5N 4C1, together with the completed and executed subscription documents.