Page 1 EB5 Investment Job Creation and Sustainment November 15, 2015 Chen Zhang, J.D./M.B.A

Page 2 EB5 Process I-526 filing I-526 Adjudicating I-526 Approval Consular Processing or A/S approved 13.8 months Conditional Resident Period 2 years 3 months 4 months I-829 filing 15.5 months I-829 approval

Page 3 The EB5 Program is based on the requirement that the immigrant investor’s capital investment in a new commercial enterprise must result in the creation of at least 10 full-time jobs for U.S. workers. I-526: An immigrant investor must submit the following evidence with his or her Form I-526 A.Evidence of 10 qualifying employees OR B.A copy of comprehensive business plan showing that the 10 employees will result, including the approximate dates, within the next two years, and when such employees will be hired. Job Creation

Page 4 Job Creation: Key Issues I-829 Adjudication: USCIS will not require that the jobs still be in existence at the time of the Form I-829. Met if the petitioner can show that at least 10 full-time jobs for qualifying employees were created as result of his or her investment and such jobs were considered to be permanent. Permanent: not intermittent, temporary, seasonal, or transient in nature; those last for at least 2 years are not such. Two-year Period: Begin 6 months after the adjudication of the Form I-526 Full-time Employment: focuses on the position, not the employee; One position can be filled by more than one employee (includes job sharing arrangements). At I-829 adjudication, allow petitioners to demonstrate that jobs will be created “within a reasonable period of time” at the time of filing the Form I-829 petition: three years from the investor’s admission as a conditional permanent resident or AOS approval

Page 5 Investment Sustainment Investment must be sustained and at risk during the conditional permanent resident period. An investor may receive a return on his or her capital during or after the conditional residence period, as long as prior to or during the two-year conditional residence period, and before the requisite jobs have been created, the return is not a portion of the investor’s principal investment and was not guaranteed to the investor.

Page 6 Private Offering - General I. Definition A method to solicit investment without stock issuer’s public offering registration at Securities & Exchange Commission II. Advantage Less burden of disclosure III. 3 Types of Offering Rule 504 Offering, Rule 505 Offering, Rule 506 Offering

Page 7 IV. General Requirement (applies to all the three types ) 1. No advertisement is allowed to solicit investment. 2. Disclosure: Non-accredited investors must receive private placement memorandum. 3. Limitation on resale: The securities cannot be resold without registration or exemption. 4. Integration Any previous Reg D offering within 6 months of the same class of securities must be integrated. 5. Antifraud Requirement: All information disclosed are subject to antifraud penalty. Private Offering

Page 8 Rule 504 Offering 1. Maximum Amount of Offering: $1 million during 12 months 2. Number of Investors: No limitation 3. Type of Investors: No limitation 4. Disclosure Requirement: No mandatory disclosure.

Page 9 Rule 505 Offering 1. Maximum Amount of offering: $ 5 million in 12 months 2. Number of Investors 1) Accredited investors*: No limitation 2) Non-Accredited investors: Up to 35 * Accredited investors are those with total asset of $1 million, or with annual income more than $200 thousand. Rule 505 Offering

Page 10 Rule 505 Offering 3. Disclosure Requirement: 1) For Non-Accredited investors: a. Must provide Private Placement Memorandum (including non-financial and financial information), a) For offering amount exceeding $2 million, issuer must present financial statement audited by certified public accountant b) For offering amount under $ 2 million, issuer only need to present audited balance sheet (must be dated with 120 days of the starting of offering date) 2) For Accredited investors: No specific requirement

Page 11 Rule 506 Offering 1. Maximum Amount of offering No limitation 2. Number of Investors 1) Accredited investors: No limitation 2) Non-Accredited investors: Up to Type of Investors Non-Accredited investors must be sophisticated, as the issuer reasonably believes the investors have knowledge and experience in financial matters to evaluate the merits and risk of the prospective investment.

Page 12 Rule 506 Offering 4. Disclosure Requirement: 1) For Non-Accredited investors: a. Must provide Private Placement Memorandum (including non-financial and financial information), a) For offering amount exceeding $2 million, issuer must present financial statement audited by certified public accountant b) For offering amount under $ 2 million, issuer only need to present audited balance sheet (must be dated with 120 days of the starting of offering date) 2) For Accredited investors: No specific requirement