Project Status Report January 2014 Broker Portal Project Status Report January 2014

Broker Portal Project Overview The Project Seeks the Creation of a National MLS Consumer Facing Property Search Website The Goal is to Create a Portal Funded by MLS dues and data, governed by brokers and MLS, to present listings to consumers with a display that adheres to the Fair Display Guidelines The First Steps Include the (1)Formation of the Organization, the Development of a Business Plan, and (2) the Development of an RFP to Build the Site.

Purpose of this presentation is to enable MLS boards and Brokers to consider participation in the creation of the business

Important Catalysts That Create Action The NAR MLS Issues and Policy Committee have clarified the model MLS rules to deem MLS consumer facing websites a Basic MLS service. This allows MLSs to use dues to develop and market an MLS consumer facing website (either on their own behalf, or via something like the National Portal). Brokers have developed a model for listing display called the Fair Display Guidelines whose main thesis is to insure that only the listing broker and agent are displayed on a listing. FairDisplay.org

November Meeting Attendees 25 Brokers 25 MLSs Discussion Fair Display Guidelines MLS Consumer Website as a Basic Benefit

November Meeting Outcomes Creation of a Governance Task Force Creation of a Technology Task Force

December Meeting Report from the Governance Task Force Report From the Technology Task Force Next Steps Raise $250,000 from Brokers and MLSs to form corporation and Build Business Plan and RFP

Current Status Two committees representing brokers and MLSs were formed: Governance Task Force and Technology Task Force The Governance Task Force provided a draft governance document The Technology Taskforce has developed a straw man of costs The next step of the project is to inform brokers and MLSs about the project and solicit involvement and funding The new class of participant in the project will incorporate the business and develop the formal business plan * If any of these issues caused a schedule delay or need to be discussed further, include details in next slide.

Draft Governance of LLC Board Of Directors 4 large brokers 3 medium brokers 3 small brokers 3 MLS executives 2 others The Company will have two (2) Member classes: MLS Members and Broker Members. The Broker Members will be subdivided into three (3) sub-classes: Large, Mid-Sized, and Small Broker Members based on the number of listings submitted to the Company Database determined as of a date prior to the Members’ election of Managers. “Local Operating Companies” in separate markets owned by the same parent company will each be eligible to be Broker Members of the Company. Firms (brokers and MLS) who provide financial support will guide the finalization of governance and incorporation

Estimated Expenses To Launch Minimum Viable Portal $15 Million The technology committee recognizes that many of the costs of launching a minimum viable product will hinge on the volume of participation of MLSs and Brokers. Another significantly variable cost will be the website marketing. Estimated costs to MLS dues $1 to $3 per subscriber per month. Firms (brokers and MLS) who provide financial support will guide the finalization the website product, business plan, RFP and budget. Traffic to the site will be driven by 200 Million Monthly MLS customer portal emails sent by MLSs today.

Current Needs and Use of Seed Funds Minimum raise of $250,000 to move forward. Meeting Expenses Consultant/Facilitation Fees Legal Fees Incorporation Fees Public Relations and Communication Fees Bookkeeping/Banking services Research and Purchase of a URL

Timeline Organizational Meeting November 2014 Governance and Technology Task Force Reports December 2014 Recruit Financial Support From MLS and Brokers January 2015 Form Corporation With Seed Funding March - April Timeline

Looking Ahead Raise at least $250k in $5k increments Hire legal firm to form corporation Communicate project and solicit industry wide feedback Recruit technology task force for RFP creation Drive MLS and broker participation

How You Can Participate Contribute $5000 in seed funding for the development of the corporate entity, business plan and go to market strategy. Indication of Interest Contribute $5000 to cover expenses Initial $5000 contribution will be credited to any membership, programming (in the case of participating MLSs) or similar fee required for participation in the Broker Public Portal upon its launch. Any unused contributions will be returned to contributors on a pro rata basis in the even the Broker Public Portal is not launched and there is a remaining balance of contributed funds. This is not an investment, but a contribution to defray meeting and other related expenses to the possible formation of the Broker Public Portal

Other Materials Fair Display Guidelines NAR MLS Consumer Website Policy Draft Operating Agreement Indication of Interest for signature and return Talking Points WAV Group has been selected as a consultant to disseminate the information about the portal to broker and MLS. If you have any questions you may reach out to Victor Lund at 805-709-6696 or victor@wavgroup.com