CrowdFunding

Steve Quinlivan
January 3, 2013 10442123

Stinson Leonard Street

Steve Quinlivan background Leonard, Street and Deinard founded in 1922 Merger it! Stin"on, Morri"on #ecker January 1, 2014 fir&" $% large"t la %30 attorney" 'ffice" in 14 citie"

Capital Raising Challenges

(ublic regi"tered offering" are e)*en"ive (ublic co&*any co&*liance co"t" are e)*en"ive #i"torically only li&ited *eo*le can *artici*ate in *rivate offering"

Private Offerings Before the JOBS Act

+riend" and +a&ily round" ,o general "olicitation -er& not defined ,o adverti"ing .(re/e)i"ting relation"!i*0 Sale" only to accredited inve"tor" .Self/certification0

Accredited Investors
1ny natural *er"on !o"e individual net ort!, or 2oint net ort! it! t!at *er"on3" "*ou"e, e)ceed" 41,000,000 5)cluding *er"onal re"idence for debt it! certain ad2u"t&ent"

Accredited Investors
1ny natural *er"on !o !ad an individual inco&e in e)ce"" of 4200,000 in eac! of t!e t o &o"t recent year" or 2oint inco&e it! t!at *er"on3" "*ou"e in e)ce"" of 4300,000 in eac! of t!o"e year" and !a" a rea"onable e)*ectation of reac!ing t!e "a&e inco&e level in t!e current year

What is Crowdfunding
6e ard 7a"ed 8ro dfunding .6egulation 8ro dfunding0 under t!e J'7S 1ct .1ccredited 8ro dfunding0 under t!e J'7S 1ct 6egulation 19 :nder t!e Job" 1ct 43 7illion annually;

Reward Based Crowdfunding

<ick"tarter et al (urc!a"e a coffee &ug to fund a goal :nregulated ,o "ale of "ecuritie" (er!a*" i""ue" it! fraud, ine)*erienced *eo*le Subterfuge for "ecuritie" "ale"

Regulation Crowdfunding
S58 *ro*o"ed rule", not yet legal =""uer adverti"ing not *er&itted but certain notice" are 6ai"e u* to 41,000,000 *er year

Regulation Crowdfunding
=nve"tor li&itation" -!e greater of 42,000 or % *ercent of t!e annual inco&e or net ort! of "uc! inve"tor, a" a**licable, if eit!er t!e annual inco&e or t!e net ort! of t!e inve"tor i" le"" t!an 4100,000> and 10 *ercent of t!e annual inco&e or net ort! of "uc! inve"tor, a" a**licable, not to e)ceed a &a)i&u& aggregate a&ount "old of 4100,000, if eit!er t!e annual inco&e or net ort! of t!e inve"tor i" e?ual to or &ore t!an 4100,000@

Regulation Crowdfunding
Mu"t be conducted t!roug! a +=,61 regi"tered broker or regulated funding *ortal (ublic infor&ation &u"t be filed -er&" of offering 'fficer" and director" 7eneficial o ner" 7u"ine"" *lan ' ner"!i* and ca*ital "tructure 5tc@ it! t!e S58

Regulation Crowdfunding
+inancial di"clo"ure A 4100,000 ta) return" B4100,000 but ACD 4%00,000 revie ed finanical "tate&ent" B4%00,000 audited financial "tate&ent"

Regulation Crowdfunding
'ngoing re*orting 1nnual filing of +or& 8/16 (o"t on eb "ite !at a" re?uired for t!e offering Si&ilar di"clo"ure" to it! S58

+inancial "tate&ent re?uire&ent" "a&e a" t!at for t!e offering

Regulation Crowdfunding
Eill it ork;

:nte"ted &odel Do co"t" e)ceed benefit"; 8onfidential bu"ine"" *lan" ,u&erou" "!are!older" force entre*reneur to beco&e an inve"tor relation" officer ,u&erou" "!are!older" &ay &ake "ub"e?uent angel and F8 inve"t&ent" difficult 1lternative" &ay be &ore attractive

Accredited Crowdfunding
J'7S 1ct and effective S58 rule" no *er&it general "olicitation in 6eg D 6ule %0G offering" 1dverti"ing, internet *o"ting" or anyt!ing ,o financial "tate&ent re?uire&ent" ,o "tatutorily re?uired di"clo"ure" 1nti/fraud rule" a**ly ,o li&it" on a&ount" rai"ed or Si&*le +or& D filing .7ad actor0 di"?ualification" E!et!er or not you generally "olicit !at can be inve"ted it! S58 Hafter fir"t "aleI

Accredited Crowdfunding
Ferification of accredited inve"tor" =""uer &u"t take rea"onable "te*" to verify accredited inve"tor "tatu" Self/certification not *er&itted "olicitation i" u"ed Safe !arbor" May look to 8(1" and la fir&" =nve"tor" do not ant to di"clo"e financial data to i""uer" !ere general

Accredited Crowdfunding
(lay S!ark -ank it! your o n &oney

(latfor&" !ave t!e *otential to revolutioniJe "tart/u* funding 1ngelli"t +under"club Eefunder 1** t!at clean" data and unlock" value tra**ed in @ @ @ "y"te&"@ 7acked by KLM and KNM> cu"to&er" include K1M and K7M@ 42$4< of annual run/rate revenue gro ing 24O M/o/M "ince launc! in @ @ @

Accredited Crowdfunding
=""ue" E!en are you generally "oliciting t!at kick" in need to verify accredited inve"tor "tatu" E!at do you need to do to verify accredited inve"tor "tatu"; Sa&e i""ue" it! large "!are!older ba"e Do/it/your"elf te&*tation 7otc!ed effort" &ay be fatal 7lue "ky i""ue" (ro*o"ed rule" &ay reduce utility

Regulation A!
(ro*o"ed rule" Dece&ber 2013 Pa&e c!anging *otential :*dated e)e&*tion to allo during a 12 &ont! *eriod "ale" u* to 4%0 &illion

Si&*lified offering "tate&ent filed on 5DP16 'ffering &u"t be ?ualified by t!e S58 t!roug! revie *roce"" =nitial "ub&i""ion" &ay be confidential .-e"t t!e ater" *rovi"ion0

Regulation A!
-ier 2 'ffering" B4% &illion and A4%0 &illion 1udited financial "tate&ent" 'ngoing annual, "e&iannual re*orting 6e*orting of "o&e current" event" like +or& Q/< 8anRt inve"t &ore t!an 10O of net ort! (ree&*t" "tate "ecuritie" la "

Steve "uinlivan

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