2
 EB-5: The Basics
 Individuals who might consider EB-5
 Direct vs. Regional Center
 Regional Center Entities
 How to create a Regional Center

3
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Congress created EB-5 category in 1990
10,000 green cards available each year in this preference
Two types of EB-5 cases: Direct and regional centers (RCs)
90-95% of EB-5 petitions now through RCs
I-829s: filed 21-24 months after investor gets conditional resident status
I-829 procedure generally
Legislative status of EB-5 program – extended to September 30,
2015 – sunset of pilot program – likely to be signed this week.
November 3, 2011

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New commercial enterprise (created after November 29, 1990)
Must “benefit the U.S. economy”
Must create at least 10 full-time jobs
Must invest $1 million, or $500,000 if targeted employment area
(TEA) (rural or high unemployment)
Procedure: File I-526 (invest/actively in the process of investing), then I-485/CP for CPR. Within 90 days of 2 yr anniversary, file
I-829.
November 3, 2011

5
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Parent who wants the children to go to school in the U.S.
Investors from non-treaty countries and E-2 investors who don’t qualify for regular EB-5 or age out child.
Retirees
Potential L-1 applicants who are nationals of China or
Russia
Entrepreneurs who want to set up a new business in the
United States that will not create 10 jobs
F-1 student who wants to start a business
November 3, 2011

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 Spouse of permanent resident
 CEO/manager of a company who is not an L-1A transferee
 Foreign nationals in a multiple-year immigrant quota waiting list
 Individual owner of a business outside of the United States who doesn’t qualify for an L-1
 H-1B nearing six year limit
 Potential H-1B shut out by quota
November 3, 2011

7

8
Investor buys business or starts new business
Must be 10 direct employees
Few applications

9
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What is a regional center?
Over 95% of all applications
Huge increase in past 3 years (over
242 approved)
Main advantage =
Indirect employment counts

10

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 Apply to USCIS for designation approval
 Ongoing administration and compliance responsibilities
 Markets projects for investors
 Due diligence regarding investors’ source of funds
 Prepares I-526 and I-829 packages

12

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Professional fees
Government filing fees for I-924 - $6,230
Regional center recoupment of costs through charges to investors
Regional center charges to project promoters
MOU for Affiliated Projects Financing costs
Source of Funds review
Banking & Escrow costs

14
Investor must invest 100% (usually $500,000) before
I-526 filed
Money can go
To project immediately – if so TEA designation made at this time
To escrow
Released when investor’s I-526 is approved

15
Depends on job creation
Economist report projects job creation
Divide by 10 = maximum number of investors
Multiply by $500,000 = maximum capital raise

16
Guaranteed redemption disallowed
What is allowed?
Third party insurance
How does it work?
Does it violate “at risk” provisions?

17
ARREA National Conference
Las Vegas – September 25, 2012
P R E S E N T E D B Y:
J O R L AW , E S Q .

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
Homeier & Law, P.C. is a law firm devoted exclusively to corporate and business transactional law, including securities, for clients ranging from established and publicly traded companies, to startup businesses and entrepreneurs in a wide range of industries. The firm’s practice includes finance, secured lending, mergers and acquisitions, licensing, securities, venture capital, new media, technology, ecommerce, and other general transactions. Homeier & Law, P.C., is a leader in EB-5 related corporate and securities transactions, and represents a number of regional centers as well as private EB-5 clients.
Jor Law is a founding shareholder of Homeier & Law, P.C.
As part of his regular corporate and securities practice, Jor routinely advises on EB-5 related transactions. In that capacity, Jor represents both investors looking to invest through the EB-5 program as well as businesses seeking capital through the EB-5 program including through regional centers. Jor frequently presents at EB-5 industry events, including those held by the American Immigration Lawyers Association, State Bar of
California, and Los Angeles County Bar Association.
Jor received his J.D. from
Columbia University and his B.A. from UC Berkeley. Jor is a member of the California and New York State Bars. In December 2008, Mr. Law was named a "Best Lawyer" by LegalForce. For three years in a row, in each of 2009, 2010, and 2011, Jor was recognized by Super Lawyers magazine as one of “Southern California’s Super
Lawyers – Rising Stars,” placing him among the top 2.5 percent of the best up-andcoming attorneys in Southern California who are 40 years old or younger, or who have been practicing for 10 years or less.

19

20
Investor
Investor
Investor
General Partner
(usually the
Regional
Center)
General Partner
(usually RC) Investor
Investor
Investor
Capital Raising
Entity & Project
Company
Capital Raising
Entity
Project
Company

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Consents, restrictions, etc.
Due Diligence
LOIs vs Term sheets
Equity vs Loan Agreements
Guarantees & Security Agreements
Subordination
Call/put
Side letters
Leases / Management Agreements, etc.
Consulting Agreements
Joint Venture
Resolutions & Corp Housekeeping

22
 Investor Questionnaire
 Subscription Agreement
 Offering Circular (PPM)
 Limited Partnership Agreement -or- LLC
Operating Agreement -or- Articles of
Incorporation & Bylaws & Shareholders
Agreement
 Escrow Agreement(s)

23
Financing secured from passive investors
+
Success dependent on management by others
=

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 Two goals of Securities Laws

 adequate disclosure (tell the truth)
 prevent fraud (don’t lie)
Means to goal – registration and/or disclosure
 Laws


Securities Act of 1933 – main (“primary transactions” by issuer)
Exchange Act of 1934 – for “secondary transactions” (resales by shareholders)
 Blue Sky


Foreign
Don’t forget… the 1940 Acts [ ICA… IAA ]

25
 The offering of a security must be registered or exempt


Registration – IPO; expensive (time and $)
Exemption – must fit within, or lost
 Primary FEDERAL exemptions: Reg D and Reg S



Example requirements:
 Private offering (Reg D)
 Non-U.S. persons (Reg S)
Don’t forget STATE exemptions
Don’t forget exemptions for large complex raises
 Investment Company Act: < 100 s/h … “qualified purchasers”

 Section 12(g) Exchange Act: < 500 s/h [JOBS = now
2,000!]
* Need to tread carefully – i’s & t’s – CAN be done

26
 Broker-dealers –vs- Finders
 Broker-dealers are usually finders;
 Not all finders are broker-dealers
 Finders do not




Solicit investors
Participate in securities offering
Regularly introduce investors
Receive compensation based on success
 Finder issues – extremely fact specific so case-by-case



27
Generic doc set – accompany Regional Center
 application filing with USCIS
Most general, least specific – still needs to address anticipated project types
Offering doc set – used to solicit investors

 Most detailed - disclose all specific terms of actual project being sold
Exemplar doc set – for USCIS to use as template for
 measuring all I-526s
BIG marketing plus – offering pre-approved
 Caution: no material changes after submission to USCIS or start review anew

28


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“Same old, same old” – done domestically all the time
This is a securities offering – SEC compliance required
 Same as typical U.S. domestic equity raise – Reg D (+ Reg S)
Need a team to prepare all parts of the offering:
 Business plan – plan writer
 Job creation report – economist
 Securities offering documents – securities counsel
(H&L does)
 Transaction documents (debt/equity) – business lawyer
(H&L does)
 Entity formation(LPs, LLCs) – corporate lawyer
(H&L does)


Financial pro forma projections – reviewed by CPAs
Marketing: foreign broker introductions – U.S.-based EB-5 consultant


29
Michael G. Homeier, Esq. – (818) 450-1551 (direct); michael@homeierlaw.com
Jor Law, Esq. – (818) 450-1552 (direct); jor@homeierlaw.com
Clem Turner, Esq. - (646) 393-4702 (direct); clemturner@homeierlaw.com
Vanessa Au, Esq. – (818) 450-1556 (direct); vanessaau@homeierlaw.com
Corporate Law -- Securities Law -- Business Transactions
– EB-5

30
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

31
Where are investors?
Personal contacts?
Brokers overseas?

32
Advising developers of options
Putting together team of professionals
Reviewing documents for immigration compliance
Filing regional center application
Preparing and filing application for project preapproval
Filing EB-5 petitions for investors

Proposal Prepared Exclusively For:
2012 AREAA National Convention in Las Vegas, Nevada
September 25, 2012
Serious Resources.
Serious commitment.
Member, FINRA/SIPC

A FINRA Registered Broker-Dealer
Our resources and commitment have earned us a role as a market leader in providing investment banking and corporate advisory services to both leading and emerging financial institutions and businesses.
Our professionals possess significant experience in nearly all facets of business transactions including debt & equity capital placements, mergers and acquisitions (over 90 M & A transactions over the past 20 years), recapitalizations and accounting and due diligence analysis.
Clients in our Creditor Advisory practice include most of the nation’s top financial institutions and we have performed in excess of 2,700 engagements on their behalf.
During 2011:
LCG performed over 550 engagements for more than 55 different financial institutions.
LCG and its affiliates assisted 45 businesses in successfully navigating the current economic environment, including financings, mergers and acquisitions, and restructurings.
34

Lender’s Consulting Group
Lender’s Consulting Group provides independent due diligence and transaction support services to the financial services industry. Our professionals have extensive experience in credit underwriting, auditing, public accounting, workout management, business operations and account management. Our specialized experience provides lenders and investors with additional insight into transaction risks that cannot be provided by most other accounting and audit firms.
Field Examinations
• Survey Exams
• Recurring Exams
Lender Due Diligence
• Credit and Operations Reviews
• Bank Acquisition Due Diligence
Valuation Services
• Portfolio Valuation
• Business Valuation
Quality of Earnings
• Analysis of Historical Revenue Trends and Sustainability
• Analysis of Recurring vs. Non-recurring Expenses
• Analysis of Cash Flow Projections
35

36
Bridging the Abyss between Lenders and Borrowers
A sampling of our institutional clients:

LCG Capital Advisors
LCG Capital provides a broad range of investment banking and advisory services for its clients. A FINRA registered broker-dealer and SIPC member firm, which provides advisory services related to corporate mergers, acquisitions and divestitures, recapitalizations, equity placements and certain other advisory and investment banking services..
Debt and Equity Placement
• Debt Offerings and Refinancing
• Equity Offerings
• Capital Structure Strategies
M&A Advisory
• Sell Side and Buy Side
• Management Buyouts
Debtor Advisory
• Restructuring and Planning
• Working Capital Management
• Pre-Bankruptcy Planning
37

38
Our Team
Mike Xenick - Managing Partner
Years of Experience: 22
Expertise: EB5 Advisory, Private Equity, Mergers & Acquisitions
Previous Employers: Atlantic American Capital Advisors,
Communications Equity Associates, Ernst & Young
Education: Masters and Bachelors in Accounting - University of Florida
Brian Smith - Managing Partner
Years of Experience: 18
Expertise: Corporate Finance, Commercial Credit, Structured Finance
Previous Employers: Textron Financial Corp, Health Capital
Education: Bachelors in Finance and Economics - University of Tampa
Paul Epstein - Managing Partner
Years of Experience: 18
Expertise: Commercial Credit, Underwriting, Due Diligence
Previous Employers: CitiFactors Financial, Healthcare Financial
Services
Education: Bachelors in Finance - University of Tampa

39
Our Team
Christopher Pizzo - Managing Director
Years of Experience: 21
Expertise: Corporate Finance, Mergers & Acquisitions,
Restructuring & Turnaround
Previous Employers: Ernst & Young, The Knot, Vested Capital
Partners
Education: MBA in Finance - NYU, Bachelors in Accounting -
SUNY Albany
MaryJane Wermuth
– Associate
Years of Experience: 5
Expertise: Corporate Finance, Mergers & Acquisitions,
Restructuring & Turnaround
Previous Employers: Merrill Lynch, Gulfcoast Business Finance,
Inc.
Education: MBA in Finance – University of Tampa
Jessica Lister
– Analyst & Project Manager
Years of Experience: 2
Expertise: EB-5 Advisory
Previous Employers: American Land Lease
Education: Bachelors in Finance
– University of South Florida

EB-5 Funding Advisory Services Practice
 LCG provides a broad range of advisory and support services to companies and individuals involved in U.S. immigrant investor programs, including the Immigrant Investor Pilot Program (“ EB-5 Program ”). Our clients include:
• USCIS-approved EB-5 Regional Centers
• Regional Center applicants, affiliated project developers
• Registered foreign and U.S. securities representatives
 We are trusted advisors to the principals and senior executives of these entities in their efforts to access U.S. and international capital markets to successfully and safely fund their project offerings.
 As a broker-dealer registered with the SEC and FINRA, LCG’s process ensures the entire transaction is completed in compliance with U.S.
securities laws and guidelines, especially transaction solicitation and payment of agent referral fees .
40

EB-5 Program Advisory Services Practice
FINRA Compliant Placement Agent
• Compliance with U.S. Securities Laws
-Solicitation
-Investor Suitability
-Payment of referral fees
• Review, Analysis & Preparation of Project Transaction and Subscription
Documents
• Access to LCG’s secure virtual data room
• Investor Intake and Related Compliance
-
“Know your customer”
-Suitability/Accredited Investor forms
-Coordinate flow of investor capital
• Payment of agent referral fees
Regional Center Advisory & Support
• Detailed Analysis of Prospective Projects
• Due Diligence and Market Research
• Capital Markets Assessments
• Risk Assessment and Mitigation
• Certified Business Valuations & Appraisals
• Quarterly Analysis of RC Project Portfolio
41

42
EB-5 Funding Process
The Initial
Evaluation
Closing the
Transaction
The LCG &
USAdvisors EB-5
Program Process
Preparation for the Proposed
Transaction
Private Placement
Marketing the
Transaction

EB-5 Funding Process
EVALUATION
PREPARATION
MARKETING
• Access to project information
• Evaluate and analyze business plan, pro forma financials, business case
• Assist with prep or review of PPM
• Disseminate support information and answer questions
PLACEMENT
•
• Agree on process
Develop process timeline
• Assess management
• Assist with or review marketing team/project materials owners
• Set up initial data
• Other detailed due diligence – project in conjunction with room and EB-5 Program
• Initial investor target list through proprietary referral
USAdvisors network
• Move forward with
• Prepare & coach accepted projects project
43 management on process
•
• Listing of project on
EB5Info.com
Contact referral network
• Distribute 1-page project description to
• Facilitate interested parties completion and
• Evaluate suitability of interested investors
• Assemble remaining due diligence data room submission of subscription docs
• Disseminate PPM and
Facilitate transfer other marketing of Admin Fee and information to suitable investment into investors escrow
• Assist investor counsel with I-526 prep
•
CLOSING
Communicate project progress and updates to investors during I-526 approval process
• Closing

LCG’s EB-5 Funding Advisory Services Practice
We offer safety, security and risk mitigation to the project owner/developer and Regional Center
EB-5 Private Equity Placements
• Solicitation and Funding of Private Equity & Debt Capital
• Access to Foreign EB-5 Investors via LCG’s Proprietary Global Referral
Network
U.S. Debt and Equity Placements
• Structuring of Entire Capital Stack
• Access to U.S. Debt & Equity Capital via LCG’s Proprietary U.S. Lender
Database
• Underwriting Services/Collateral Analysis
Registered U.S. Securities Representatives (“Agents”)
• Assist with Initial & Ongoing Securities Registrations and Compliance
• Access to High Quality Projects for Placement
• We work with U.S. based real estate agents (AREAA members) to add to our network as registered reps, providing new commission opportunities
44

Contact Information
Tampa Headquarters
Fifth Third Center
201 E. Kennedy Blvd
Suite 325
Tampa, FL 33602
Phone: (813) 226-2800
Email: Mike Xenick, mxenick@lcgapital.com
Jessica Lister, jlister@lcgcapital.com
Web: http://www.lcgadvisors.com/services/eb-5-capital.aspx
New York • Chicago • Houston • Dallas • Boston • Atlanta • Miami • Indianapolis • Los Angeles
45
LCG is a trade name for LCG Capital Holdings, LLC and its subsidiaries and affiliates which include: LCG Capital Group, LLC, a Florida limited liability company, which provides debt placement, commercial real estate financing, loan portfolio divestitures, and certain other financial advisory services; LCG Advisory Services, Inc., a Florida corporation, which provides strategic advisory, light turnaround and distressed consulting, restructuring advisory, accounting support, interim CFO/controller services, and other corporate consulting services; and LCG Capital Advisors, LLC, a Florida limited liability company and a FINRA registered broker-dealer and SIPC member firm, which provides investment banking, private placement and merger, acquisition and divestiture advisory services.
Serious Resources.
Serious commitment.

46
© 2012 Wolfsdorf Immigration Law Group (all rights reserved) . The contents of this document are proprietary and should not be duplicated or shared without the express permission from Wolfsdorf Immigration Law Group.
This presentation does not constitute direct legal advice and is for informational purposes only. The information provided should never replace informed counsel when specific immigration-related guidance is needed.
46 September 25, 2012