In the year 2015, according to a research and advisory firm, crowdfunding platforms in real estate investment have generated about $34.4 billion and is conservatively expected to greatly increase this year. The rapid growth has been spurred by a number of regulatory amendments made by SEC, thus, allowing companies to offer and sell securities through crowdfunding. The recent approval of the JOBS Act's Title III rules is expected to generate new activity for real estate crowdfunding. In this LIVE Webcast, a seasoned panel of thought leaders and professionals brought together by The Knowledge Group will provide the audience with an in-depth discussion of the fundamentals as well as recent developments in Real Estate Crowdfunding. Key topics include: Real Estate Crowdfunding Platform Recent Trends and Developments in Real Estate Crowdfunding Five Key Areas of Commercial Real Estate Restrictions on Real Estate Crowdfunding Scope and Limitation To view the webcast go to this link: https://youtu.be/8IqGese6OMg To learn more about the webcast please visit our website: http://theknowledgegroup.org

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Presented By:
Partner Firms:
July 14, 2016 1
CrowdStreet, Inc.
Tore Steen
CEO, Co-Founder
DLA Piper
Darryl Steinhause
Partner
Golan & Christie LLP
Rita W. Garry
Partner

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July 14, 2016 4

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July 14, 2016 6

7. Partner Firms:
July 14, 2016 7
CrowdStreet is a software and services company disrupting
the commercial real estate industry by enabling innovative real
estate operators and developers to efficiently engage in online
capital formation, communicate with investors, distribute
investment documents and centralize ongoing investor
relations.
CrowdStreet technology solutions provide real estate
sponsors a scalable platform for managing a large investor-
base.
The Real Estate Capital Markets group of DLA Piper builds
creative solutions for your business needs. Our
interdisciplinary approach ensures the involvement of skilled
practitioners to address the complexities of real estate
securities. Our group's experience acting as lead counsel on
fund, REIT, DST, TIC and debt offerings, gives our clients an
edge in capital markets transactions.
Your Success. Our Focus
Golan & Christie is a business centric law firm staffed with
business savvy and experienced litigation and transactional
attorneys who put their clients’ needs and goals first and
foremost. Golan & Christie’s attorneys and skilled staff work
together to build strong client relationships and work together
to support and drive their clients’ success. Please visit
www.golanchristie.com to learn more about our people and
our services.

8. Brief Speaker Bios:
► For more information about the speakers, you can visit: https://theknowledgegroup.org/event-homepage/?event_id=1608
July 14, 2016
8
Rita W. Garry
Rita W. Garry is a Partner with Golan & Christie in Chicago, IL. Rita’s 30+ years of work serving as a trusted business advisor to many diverse start-up, emerging, and mature
businesses includes entity design and formation, founders agreements, corporate tax and regulatory compliance, review and negotiation of a vast array of commercial contracts,
mergers, acquisitions and divestitures, debt and private equity financing transactions and private securities offerings. Rita is a published author on SEC private offerings under
Regulation D and Crowdfunding under the JOBS Act and a frequent presenter on entrepreneurial law topics. Rita also served as an Illinois State Content Editor for Thomson
Reuters’ Practical Law corporate and M&A product offering. Rita is a long-standing member of the ABA Business Law Section and its Middle Market and Small Business, Private
Equity and Venture Capital, and Federal Securities Committees and she has written and spoken at seminars, symposiums, and meetings on numerous business and securities law
topics including.
Tore Steen
Tore is a business leader in the internet and software industries with deep expertise in strategy, business development, sales, and marketing for both publicly traded and private
enterprises.
Prior to CrowdStreet, Tore was instrumental in leading the product, sales, marketing, and business development efforts for Janrain, taking them from early stage rapid growth
phases to becoming the recognized leader in the social identity space with a full user management platform and global enterprise customers. He has held senior leadership roles as
the Vice President of Business and Corporate Development at WebTrends and Director of Business Development at EarthLink.
Darryl Steinhause
Darryl Steinhause has more than 30 years of experience in complex securities and tax transactions, representing both sponsors and investors in a range of deal structures. The
Daily Journal selected Steinhause as one of the Top 100 Lawyers in California in 2014 for his work with clients looking to invest in new online real estate platforms. Steinhause was
one of the first in his field to recognize the implications of the 2012 JOBS Act which amended Rule 506 of Regulation D of the Securities Act of 1933, and has been advising clients
on both the potential and the complications of such platforms.

9. In the year 2015, according to a research and advisory firm, crowdfunding platforms in real estate investment have generated about
$34.4 billion and is conservatively expected to greatly increase this year. The rapid growth has been spurred by a number of
regulatory amendments made by SEC, thus, allowing companies to offer and sell securities through crowdfunding. The recent
approval of the JOBS Act's Title III rules is expected to generate new activity for real estate crowdfunding.
In this LIVE Webcast, a seasoned panel of thought leaders and professionals brought together by The Knowledge Group will
provide the audience with an in-depth discussion of the fundamentals as well as recent developments in Real Estate Crowdfunding.
Key topics include:
• Real Estate Crowdfunding Platform
• Recent Trends and Developments in Real Estate Crowdfunding
• Five Key Areas of Commercial Real Estate
• Restrictions on Real Estate Crowdfunding
• Scope and Limitation
July 14, 2016 9

10. Featured Speakers:
SEGMENT 2:
Tore Steen
CEO, Co-Founder
CrowdStreet, Inc.
SEGMENT 3:
Darryl Steinhause
Partner
DLA Piper
SEGMENT 1:
Rita W. Garry
Partner
Golan & Christie LLP
July 14, 2016 10

11. Introduction
Rita W. Garry is a Partner with Golan & Christie in Chicago, IL. Rita’s 30+ years of work serving as a trusted business advisor to many diverse
start-up, emerging, and mature businesses includes entity design and formation, founders agreements, corporate tax and regulatory
compliance, review and negotiation of a vast array of commercial contracts, mergers, acquisitions and divestitures, debt and private equity
financing transactions and private securities offerings. Rita is a published author on SEC private offerings under Regulation D and
Crowdfunding under the JOBS Act and a frequent presenter on entrepreneurial law topics. Rita also served as an Illinois State Content Editor
for Thomson Reuters’ Practical Law corporate and M&A product offering. Rita is a long-standing member of the ABA Business Law Section
and its Middle Market and Small Business, Private Equity and Venture Capital, and Federal Securities Committees and she has written and
spoken at seminars, symposiums, and meetings on numerous business and securities law topics including
Ms. Garry received her law degree from Boston University and her B.A. in Politics from Lake Forest College, graduating Phi Beta Kappa with
High Honors. Ms. Garry also received her CFP license in 1991. She can be reached at rwgarry@golanchristie.com or (312) 696-1366.
July 14, 2016 11
SEGMENT 1:
Rita W. Garry
Partner
Golan & Christie LLP

12. REAL ESTATE CROWDFUNDING:
LATEST TRENDS & DEVELOPMENTS
12
Rita W. Garry | Partner
GOLAN & CHRISTIE LLP
70 W Madison, Ste 1500, Chicago, IL 60602
(312) 696- 1366
rwgarry@golanchristie.com
www.golanchristie.com
www.linkedin.com/in/ritagarry
2016 Leading Lawyers Profile

13. Securities Laws & Private Offerings
 The Securities Act of 1933 –
 Section 3 - Exemptions from Registration for wholly
intrastate offerings of securities
 Section 4 - Exemptions from Registration for private
(non-public) offerings of securities
13

14.  Investor Protection is the Landmark:
 Anti-Fraud Provisions of federal and state securities’ laws
and regulations prohibit issuers from making untrue
statements of material facts or omitting to state material
facts required to be stated or necessary to make the
statements, in light of the circumstances under which they
are made, not misleading
14

15. Regulation D
 The SEC enacted Regulation D in 1984 and it has served as the
primary tool for entrepreneurs raising capital in private
offerings for the last 30+ years.
 Regulation D includes 3 main private offering safe harbors:
 Rule 504 - $1M Limit
 Rule 505 - $5M Limit
 Rule 506 - Unlimited Amount – Accredited Investors Only
15

16. Limits of Reg D
Dollar Ceilings
Qualified Investors
No Public Solicitation or General
Advertisements
State Securities’ Laws Still Apply
16

17. THE JOBS ACT OF 2012
 Congress passed The Jumpstart Our Businesses Act
in April, 2012 with only 4 “no” votes.
 Title I Emerging Growth Companies
On-Ramp
 Title II General Solicitation
 Title III Crowdfunding
 Title IV Regulation A
17

18. Regulation A
& Title IV of the JOBS Act
 REGULATION A+
 Tier 1 Offerings - $20M
 Tier 2 Offerings - $50M
After JOBS Act, Reg A+ offers issuers more options:
$50M Ceiling
Simplified Registration Statement (Form 1-A)
Public Solicitation to “Test the Waters”
No Restrictions on Resale
No Requirement for Audited Financial prior to Offering
18

19. Bad Actor Disqualification
 The “bad actor” disqualification provisions contained in Rule
262 of Regulation A disqualify securities offerings from
reliance on Regulation A if the issuer or other relevant
persons (such as underwriters, placement agents, and the
directors, officers and significant shareholders of the issuer)
(collectively, “covered persons”) have experienced a
disqualifying event, such as being convicted of, or subject to
court or administrative sanctions for, securities fraud or other
violations of specified laws.
19

20. Bad Actor- Covered Person
 Covered persons” include:
 the issuer, including its predecessors and affiliated issuers
 directors, general partners, and managing members of the issuer
 executive officers of the issuer, and other officers of the issuers that
participate in the offering
 20 percent beneficial owners of the issuer, calculated on the basis of voting
power
 promoters connected with the issuer in any capacity
 persons compensated for soliciting investors, including their directors,
executive officers or other officers participating in the offerings, general
partners and managing members
20

21. Bad Actor-Disqualifying Events
 Under the final rule, disqualifying events include:
 Certain criminal convictions
 Certain court injunctions and restraining orders
 Certain final orders of certain state and federal regulators
 Certain SEC disciplinary orders
 Certain SEC cease-and-desist orders
 Suspension or expulsion from membership in a self-regulatory organization
(SRO), such as FINRA, or from association with an SRO member
 SEC stop orders and orders suspending the Regulation A exemption
 U.S. Postal Service false representation orders
21

22. General Solicitation
 Title II- Rule 201(a)(1) amends Rule 502(c) of Regulation D to
make the prohibition on general solicitation inapplicable to
offers and sales under Rule 506(c) provided all purchasers are
“Accredited Investors” & Issuer has taken reasonable steps to
verify that status
 Accredited Investors (Rule 501) = $1M Net Worth (exclude
residence) or Annual Income ($200k or $300k for couples) Test
 Other Qualified Entities
22

23. Equity Crowdfunding
 Title III of the JOBS Act and Reg. CF (adopted nearly 4 years
after the act) create the unique exemption from registration
under Section 4(a)(6) of the ‘33 Act for offers and sales of
“securities” up to $1M (in 12 month period) from non-
accredited investors AND using General Solicitation (the
“Wisdom of the Crowd”) using Internet portals specifically
designed and regulated to provide a level of investor
protection.
23

24. Regulation CF Snapshot
 $1 Million offering limit
 Available for use only by U.S. domestic business enterprises
 Offerings must be conducted through broker-dealer or funding portal intermediaries
 Offerings must be made through intermediaries’ publicly accessible internet platforms
 Broker-dealers or funding portals may earn commissions and success fees
 Issuers and intermediaries must disseminate an SEC filed offering statement to
prospective investors
 No pre-commencement SEC review or clearance required for offering statement
 Intermediaries must maintain communication channels to foster the “wisdom of the
crowd”
 Off-platform advertising limited to “tombstone” type notices
 Side-by-side crowdfunding offerings and Reg D-Rule 506(c) offerings are permitted 24

25. Real Estate and Crowdfunding
 Google search for these two words returns 650,000 results:
www.lendinghome.com
www.wecrowdfundrealtydeals.com
www.fundrise.com
www.realtymogul.com
www.realtyshares.com
www.ifunding.com
www.crowdstreet.com
25

26. What is Real Estate Crowdfunding?
 Crowdfunding is a new tool for raising money for businesses and an easier way to access such ventures for investors. It utilizes
social media outlets like Facebook, Twitter and LinkedIn to reach an audience of potential investors. The idea behind
crowdfunding is that many people are willing to invest a small amount, and when they do, large sums of money can be raised
quite quickly. It opens doors for businesses to investors they could never reach otherwise.
 In the past, real estate development was only available for investment through private equity in the development company or
through real estate investment trusts (REITs) and was not feasible as a direct investment for most individuals. This is because
each real estate development venture is a finite project, and registering each product as a security, even under Regulation D
filings, is inefficient. Furthermore, real estate developers were not allowed to actively market or solicit investments for their
projects due to restrictions by the Securities and Exchange Commission (SEC).
 As the concept of crowdfunding was growing, the Jumpstart Our Business Startups Act of 2012 modified certain rules under
Regulation D that opened the door for more direct marketing and solicitation to accredited investors. Now, real estate developers
can rely on crowdfunding sites to solicit investments from high-net-worth investors who are eager to make an investment in this
market. The SEC is reviewing material in an attempt to open this market up to all investors, but for now, crowdfunding sites
must classify each investor to ensure they qualify to make private investments in real estate in this manner. It is the hope that the
online investment market for real estate will flourish in the coming years, giving investors a great alternative.
Read more: What is real estate crowdfunding? | Investopedia http://www.investopedia.com/ask/answers/100214/what-real-estate-
crowdfunding.asp#ixzz4DZmyreGa
Follow us: Investopedia on Facebook 26

27. FIX CROWDFUNDING ACT
• Title III and Reg CF get a “fix”!
– On July 5, 2016 HR 4855 passed on a 394 to 4 vote to
further expand equity crowdfunding:
 Enable “Testing the Waters” for CF offerings
 Raise the funding amount to $5M
 Clarify Transaction Caps to “the greater of”
 Allow use of Single Purpose Vehicles or SPVs for
investor pooling
27

28. Contact Information:
Rita W. Garry
Golan & Christie
70 W. Madison Street
Suite 1500
Chicago, IL 60602
T: 312-696-1366
E: rwgarry@golanchristie.com
The information provided in this presentation is not intended to be, and shall not
be construed to be, either the provision of legal advice or an offer to provide legal
services. Rather, the content is intended as a general overview of the subject
matter covered. Golan & Christie, LLP is not obligated to provide updates on the
information presented herein. Those viewing this information are encouraged to
seek direct counsel on legal questions.
28

29. July 14, 2016 29
SEGMENT 2:
Tore Steen
CEO, Co-Founder
CrowdStreet, Inc.
Introduction
Tore is a business leader in the internet and software industries with deep expertise in strategy, business development, sales, and
marketing for both publicly traded and private enterprises.
Prior to CrowdStreet, Tore was instrumental in leading the product, sales, marketing, and business development efforts for Janrain,
taking them from early stage rapid growth phases to becoming the recognized leader in the social identity space with a full user
management platform and global enterprise customers. He has held senior leadership roles as the Vice President of Business and
Corporate Development at WebTrends and Director of Business Development at EarthLink.
Tore earned a Master of Business Administration from Duke University and a Bachelor of Arts in political science from the University of
Notre Dame.

30. CrowdStreet Presentation

31. CROWDFUNDING

32. 17
KEY TAKE-AWAYS
• Debunk the “crowdfunding” myths
• Learn the facts about Online Capital Raising
• Case Studies
• Discover how to apply to your business

33. A BRIEF HISTORY
• JOBS Act: Advertise Private Placements, Online
Equity Investing Portals
• Cloud-based technology advancements
• Consumer behavior migrated online
• “Uberization of Money” - WSJ Article 11/6/2015

34. GENIUS IDEA
OR

35. GENIUS
IDEA
What’s the matter Bill, you have to
raise money on Facebook now?
This will end worse than
the TIC debacle.
Just wait until grandma loses her money,
then crowdfunding will implode.
Offering my investors an online
portal is critical to both of us.
I’m investing in tech that
improves my investor experience.
Better business model than
high-load non-traded REITS.

36. 17
• Fundraising (debt & equity)
• Investor Management
• e-Funding & Advisory
• Institutional & Retail Capital Sources Participating
CROWDFUNDING = ONLINE CAPITAL FORMATION

37. Marketplaces
• Direct to Investor (CrowdStreet)
• SPV Investment Manager (RealtyMogul, RealtyShares)
• P2P Lenders (Patch of Land, PeerStreet)
• eREIT (Fundrise)
Sponsor Direct
• Cloud-based, White-label software (CrowdStreet)
Funding Platform Business Models

38. • Direct to Investor - flat fees (for technology and services)
• SPV Investment Manager - commissions, spread & carried interest
• P2P Lenders - origination points & spread
• eREIT - FFO
• Cloud-based, White-label software - software license fees
How do Funding Platforms Make Money?

39. • How big is the debt & equity transaction market? Divide by 10.
• $1 Billion+ of annual capital flow
• 100,000+ transactions per year
• Early Adopters lead the way for mass market
How Big is the Market?

40. • eCommerce did not replace brick & mortar, it
supplemented it
• CRE sponsors add online channel to existing
fundraising methods
• 10% of required equity in 2016, rising to 25% by 2019
(forecast)
• Growth engine
• Get on board or get left behind...seriously, become a
dinosaur
Multichannel Fundraising

41. 17
• Varies widely based on the portal
• Avg Project raises $1-$3M; Predicted to grow to $3-$5M by 2018
• Avg investment size by accredited investors: $50K, yet as small as $5,000
on certain SPV & P2P platforms
• Avg timing: 30-60 days
How Much Money Can I Raise on a Funding Platform?

42. SUCCESS STORIES
Intellistay Hospitality
Intellistay Booneville
A high-yielding Missouri hotel
investment opportunity with
upside opportunity
• 30 Investors
• $810,000 raised
Intellistay Lima
A high-yielding Ohio hotel
investment opportunity with
upside potential
• 112 Investors
• $3,500,000 raised
• Intellistay’s initial
engagement with
CrowdStreet
(Booneville) yielded
30 new investors and
a $810k raise.
• Many of these 30
investors returned for
Intellistay’s second
CS deal (Lima) along
with a large volume of
new investors -
bringing the total to
112 new investors and
a $3.5 million dollar
raise.

43. • Mezz Debt: 9-13%. Origination points. Annual Servicing Fees.
• Equity: 7-9% Pref; Mid teens IRR
• Sponsor fees must be fully disclosed
• Sponsor must have “skin in the game”
• Capital stack alignment
What’s the Cost of Capital?

44. • Typically mezz debt or pref equity
• Senior debt only on SFR fix & flip
• Percentage of total capital raise: 10% - 100%
How syndicated equity/debt fits into your capital stack
Everest (Small-Mid Cap)Encore Phoenix (Large Cap) Olympus (Equity Fund)

45. 17
1. Define your objectives
2. Interview leading funding platforms, pick the best one for you
3. Budget time & resources
4. Confirm legal & securities positions
5. Build your own online capabilities directly from your website
6. Pick the best deal and GO!
7. Monitor campaign on weekly basis for optimal results
Steps to Get Started

46. SUCCESS STORIES
Denholtz Associates
1. Customer Profile: Denholtz Associates
• History: In 60 year history have syndicated 25M+ sq ft in
transactions (4.5M today)
• Asset Types: Office, Industrial
• Tech Stack: Yardi, home-grown Microsoft Access IRM solution
• Properties: 30 (active in Sponsor Direct)
• Investors: ~500 (imported into Sponsor Direct)
2. Problem
• Lack a technical solution to support investor management and
fundraising, using a homegrown MS Access solution that wasn’t
scaling with their business
• Initially interested in fundraising for new posting, but quickly
refocused on delivering an end-to-end platform when learned more
about the CrowdStreet solution
3. Solution
• Initial: CrowdStreet Sponsor Direct (IRM for funded deals)
• Add-On: Fundraising for new deals (dual-posted on CrowdStreet
Marketplace)

47. • Everyone will raise capital or invest online by 2026
• Tech-enabled capital advisory, e-Funding = fewer middlemen
• Broad adoption: institutional to unaccredited investors
• Global capital flow
• Updated SEC FINRA regulations
What’s Next for Private Equity Online Capital Formation?

48. Real estate developers, operators and capital providersFor:
CrowdStreet Provides: Comprehensive online fundraising and investor management solutions
Acquire and nurture new investors
and build investor networks for
present and future deal flow
Differentiated:
Marketplace Sponsor Direct (SaaS solution)
Benefit from our 80+ years of deep
CRE + technology experience
To grow their investor base, manage their existing and future investors, and improve the
efficiency and effectiveness of their fundraising activities
Who Need:

49. Customers
Multifamily Office Retail Hospitality
Senior Housing Medical
StorageOther Industrial

50. July 14, 2016 50
SEGMENT 3:
Darryl Steinhause
Partner
DLA Piper
Introduction
Darryl Steinhause has more than 30 years of experience in complex securities and tax transactions, representing both sponsors and
investors in a range of deal structures. The Daily Journal selected Steinhause as one of the Top 100 Lawyers in California in 2014 for
his work with clients looking to invest in new online real estate platforms. Steinhause was one of the first in his field to recognize the
implications of the 2012 JOBS Act which amended Rule 506 of Regulation D of the Securities Act of 1933, and has been advising
clients on both the potential and the complications of such platforms. Steinhause has been recognized as an industry expert at the
forefront of this exciting new area of opportunity, and has spoken on the subject of crowdfunding at numerous conferences since the
Rule changed in 2012.

51. What Has Changed?
Darryl Steinhause
DLA Piper LLP US
darryl.steinhause@dlapiper.com
All Rights Reserved 7/14/2016

52. I. What Has Changed?
1. Rule 506(c)
a. New rules – Jobs Act
b. Advertise
c. Check the Box
d. Only accredited investors
52

53. 2. Platforms
a. Based on AngelList and FundersClub
i. Platforms are not required to register as broker-
dealers?
ii. What does AngelList and Funders Club mean?
b. Nothing to do with Jobs Act – Based on SEC no action
letters –- not a change in law
c. Three basic types of platforms
i. Statutory
ii. Issuer direct
iii. Separate LLC’s created to invest
53
I. What Has Changed?

54. d. Structures:
i. Sponsor operates a website
ii. Sponsor sets up an LLC to make investment in
securities (fund structure)
iii. Investment managed by investment advisor (fund
structure)
iv. Security offerings are restricted to accredited investors;
platforms password protected
v. Platforms do not make any recommendations to
potential investors – no solicitation except for website
54
I. What Has Changed?

55. vi. Neither the platform nor its officers, directors or
employees receive compensation in connection with
the purchase or sale of securities
A. Advisor receives a promote (fund structure); Fixed
payment for issuer direct
B. The amount and terms of any compensation are
disclosed to investors
vii. Platform does not handle customer funds or securities
viii.Neither the platform nor its associated persons are
subject to a statutory disqualification
55
I. What Has Changed?

56. e. What is the Basis for the No Action Letters?
i. No solicitation?
ii. No transaction based compensation?
iii. Already regulated as a result of investment advisor status?
iv. Where is the exemption in the law?
v. Maybe SEC did not make a decision?
f. Some states do not agree
g. Issues for Real Estate
i. SEC only thought this would be used by venture capital funds
ii. Promote issues
iii. Sponsor indicated they only received compensation for
managing the investments
56
I. What Has Changed?

57. iv. Are these 506(b) or 506(c) offerings
A. Limitation on right to purchase
B. Long line of authority that has been changing as
marketing has changed.
(1) SEC Release 33-7856
(2) Lamp Technologies
(3) IPO NET
57
I. What Has Changed?

58. 3. All rules under Regulation D still apply
a. Advertising in a 506(c)
b. No Advertising in 506(b)
58
I. What Has Changed?

59. 4. Platforms advertise the website
a. Investors cannot see any of the offerings until they qualify
as am accredited investor.
b. Since this is a 506(b) offering, investors can self-certify.
5. Citizen VC
a. Require pre-existing substantive relationship
b. No define waiting period.
59
I. What Has Changed?

60. II. Broker-Dealer Considerations
1. Any person that engages in the business of effecting
transactions in securities for the accounts of others must
register as a broker-dealer
2. Issuers themselves do not have to register
3. Rule 3a4-1 provides an exemption for persons who work for
the issuers
a. Must comply with all of the following:
i. cannot be subject to a statutory disqualification;
ii. cannot receive performance based compensation; and
iii. is not an associated person of a broker or dealer.
60

61. II. Broker-Dealer Considerations (cont’d)
4. In addition to complying with all of (a) through (c) above, the
person must also comply with one of the following:
a. the security must be sold through a registered broker-
dealer (or other specified person);
b. the person
i. primarily performs, or intends to perform, substantial
duties for the issuer other than the sale of securities,
ii. is not, and has not for the prior 12 months, been an
associated person of a broker-dealer, and
iii. does not participate in more than one offering every 12
months; or
61

62. II. Broker-Dealer Considerations (cont’d)
c. the associated person
i. only prepares or delivers written communications through
the mail or means that does not include oral solicitation,
ii. only responds to inquiries initiated by potential investors
which are limited to the contents of the offering material, or
iii. only performs administrative work with respect to the
transaction
d. SEC Recent Comments
i. Enforcement for failure to be licensed in absence of other
circumstances
ii. Blass Speech
e. State Broker-Dealer Rules
62

63. III. Regulation A
1. Eligible Issuers
a. Issuers organized in and their principal place of business in the
United States and Canada
b. Certain issuers are not eligible
i. Reporting companies
ii. 40 Act companies
A. BDC’s
iii. Blank check companies
A. Blind pool allowed
iv. An entity issuing undivided interests in oil and gas
v. Failure to file Regulation A reports during last 2 years
vi. SEC registration revoked in the last 5 years
vii. Certain bad actors
63

64. III. Regulation A (cont’d)
2. Eligible Securities
a. Equity securities – including warrants
b. Debt securities
c. Debt securities exchangeable into equity securities
i. Asset-backed securities are excluded
64

65. III. Regulation A (cont’d)
3. Offering Limitation
a. Tier 1
i. Limited to $20 million in a 12-month period
b. Tier 2
i. Limited to $50 million in a 12-month period
c. Selling shareholders allowed to sell 30%
65

66. III. Regulation A (cont’d)
4. Investment Limitations
a. Accredited — No Limits
b. Non-accredited purchasers limited to 10% or greater of the
investor's annual income or net worth
i. This limitation does not apply if the security is publicly
traded on a national securities exchange
66

67. III. Regulation A (cont’d)
5. Integration Rules
a. No integration with prior sales of securities
b. No integration with subsequent sales of securities that are:
i. Registered
ii. Issued under Rule 701
iii. Employee Benefit Plan
iv. Regulation S
v. Under the crowdfunding rules
vi. Made no more than 6 months after the completion of the
Regulation A offering
c. You can do multiple offerings at the same time as long as they
comply with both rules
67

68. III. Regulation A (cont’d)
6. Reporting Requirements – Tier II
a. Annual - Form I-K
b. Semi-annual - Form 1-SA
c. Current reports - Form 1-U
d. Special financial reports - Form 1-K
e. Exit reports - Form 1-Z
7. Section 12(g)
a. Tier II exempt if:
i. Complies with reporting requirements
ii. Engages a transfer agent
iii. Revenues of less than $50 million and public float of less than $75 million
68

69. Event REGULATION A REGULATION D
Timing Must be approved by the
SEC Anticipated to take 3-8
months to complete
Can complete an offering in
several weeks
Cost Expensive process The cost of a Regulation D
offering is probably 25% to
50% of what it will cost to
complete a Regulation A
offering or less
Limit on
Securities
You are limited as to the
type of security
There is no limit on the
types of securities
IV. Regulation A Compared to Regulation D
69

70. Event REGULATION A REGULATION D
Issuer
Financial
Information
Better for investors -
Regulation A requires certain
financial information to be
provided
Better for sponsors - No
requirement to provide any
financial information
Reporting Better for investors - It
requires certain reports to be
provided
Better for sponsors - It has
fewer reporting requirements
Type of
Investors
Allows you to sell to
accredited and certain non-
accredited investors,
provided non-accredited
investors meet certain
requirements
Generally only accredited
investors - Can sell to
certain non-accredited but
most Regulation D offerings
do not comply
IV. Regulation A Compared to Regulation D
70

71. Event REGULATION A REGULATION D
Type of
Issuers
Limits who can be an issuer No limitation on the type of
issuers
Offering
Documents
There is a benefit in that
there is a simplified form of
offering documents; if you
use S-1 or S-11 it is more
complicated.
There is no form of offering
memorandum, and if you
only sell to accredited
investors, there is no actual
offering documents required
(subject to 10(b)(5)
General
Solicitation
Testing the water is
permitted
506(b) not allowed
506(c) allowed
71
IV. Regulation A Compared to Regulation D

72. Event REGULATION A REGULATION D
Transferability The shares are freely
transferrable
Subject to finding
appropriate securities
exemptions
Reporting
Company
Rules
You can go over the 2,000
limitation and avoid
becoming a reporting
company as long as you
do not exceed certain
thresholds
If you only sell to accredited
investors, you will probably
have fewer investors and
less likelihood of exceeding
the 2,000 limitation
FINRA FINRA views a Regulation
A offering similar to a
public offering; as a result,
broker-dealers have to
meet all the public
requirements
You have to submit a copy
of the Regulation D offering
to FINRA, but no approval
requirements
72
IV. Regulation A Compared to Regulation D

73. Event REGULATION A REGULATION D
Integration Not integrated with any
prior offers and can have
concurrent offerings
Integrated with other
offerings
Issuer
Liability
Issuer liability is better for
the investor
Issuer liability is better for
the issuer
Selling
Shareholders
Allows shareholders to
sell concurrently with the
offering
Difficult to comply with
securities law with selling
shareholders
270042629
73
IV. Regulation A Compared to Regulation D

74. ► You may ask a question at anytime throughout the presentation today. Simply click on the question mark icon located on the floating tool bar on the bottom right side of your screen. Type your question in the box that
appears and click send.
► Questions will be answered in the order they are received.
Q&A:
July 14, 2016 74
SEGMENT 2:
Tore Steen
CEO, Co-Founder
CrowdStreet, Inc.
SEGMENT 3:
Darryl Steinhause
Partner
DLA Piper
SEGMENT 1:
Rita W. Garry
Partner
Golan & Christie LLP

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