CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM

March 1, 2022

TREP, LLC

TOKENIZED REAL ESTATE PROPERTIES

MAKING REAL ESTATE ACCESSIBLE FOR ALL

 

TREP, LLC

a Wyoming limited liability company

1309 Coffeen Avenue, STE 1200

Sheridan, WY 82801

 

www.trep.co

investor.relations@trep.co

 

 

­IN COMPLIANCE WITH SEC REGULATION D, RULE 506(c), TREP, LLC. IS NOT REQUIRED TO REGISTER ITS OFFERING SECURITIES WITH THE SEC, BUT IT HAS FILED “FORM D” WITH THE SEC. THE SECURITIES BEING OFFERED HAVE NOT BEEN REGISTERED WITH THE WYOMING DIVISION OF BANKING. THIS PRIVATE OFFERING MEMORANDUM HAS NOT BEEN REVIEWED BY THE ATTORNEY GENERAL PRIOR TO ITS ISSUANCE AND USE. THE ATTORNEY GENERAL OF WYOMING STATE HAS NOT PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

 

 

TREP, LLC

 

UP TO 50,000,000 LIMITED LIABILITY MEMBERSHIP INTERESTS

DELIVERED IN THE FORM OF CRYPTOGRAPHIC DIGITAL TOKENS

(“TOKENS” OR “SECURITIES”)

 

Offering Price $1.00 per Token

Minimum Investment of 50,000 Tokens

 

Confidential Private Placement Memorandum

March 1, 2022

 

DISCLAIMER

 

This private placement memorandum (as it may be amended and supplemented from time to time, this “Memorandum”) has been prepared by TREP, LLC, a Wyoming limited liability company (“TREP,” “TREP Tokens,” “Tokens,” “Securities,” “we,” “us,” “our” or the “Company”) for use by certain qualified potential investors (“Investors”) to whom the Company is offering (this “Offering”) the opportunity to purchase up to a maximum of fifty million (50,000,000) limited liability company membership interests (“Interests”) of TREP, LLC in the form of cryptographic digital tokens (“Tokens”) which are a new series of Ethereum blockchain-based smart contract digital tokens meeting ERC-3643 standards as modified to meet transfer restriction requirements under applicable U.S. securities laws. Purchases of TREP Tokens will be paid for in U.S. dollars, Bitcoin (“BTC”), Ethereum (“ETH”), and other crypto tokens at the Company’s sole discretion. The offering price of a Token is $1.00 (the “Offering Price”), and the maximum amount of the Offering (the “Maximum Offering Amount”) is $50,000,000.

 

TREP Tokens have not been, and will not be, registered under the Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. Accordingly, TREP Tokens are being offered and sold only (i) to “accredited investors” (as defined in Rule 501 of Regulation D under the Securities Act) in reliance on Regulation D under the Securities Act and (ii) in offshore transactions to persons other than “U.S. persons” (as defined in Regulation S under the Securities Act) in reliance upon Regulation S under the Securities Act. See “Plan of Distribution.” U.S. persons seeking to invest will be required to provide documentary evidence of their accredited investor status satisfactory to the Company.

 

Investors who are U.S. persons must purchase a minimum of fifty thousand (50,000) TREP Tokens at an aggregate purchase price of $50,000.00 to participate in this Offering, although TREP, in its sole discretion, may determine to accept a lesser amount. Investors who are not included in the Regulation S definition of “U.S. persons” investing under the Regulation S exemption may purchase a minimum of one thousand (1,000) Tokens.

 

Prospective Investors should inform themselves as to the legal requirements and tax consequences within the countries of their citizenship, residence, domicile, and place of business with respect to the acquisition, holding, or disposition of TREP Tokens, and any foreign exchange restrictions and foreign qualification, filing and reporting obligations that may be relevant thereto.

 

NONE OF THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION, ANY FOREIGN SECURITIES, OR ANY OTHER FEDERAL, STATE, OR FOREIGN AUTHORITY HAS APPROVED OR DISAPPROVED OF THESE TOKENS, NOR HAVE ANY OF THE FOREGOING PASSED UPON OR ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THIS MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

TREP Tokens are securities; they are not digital currency, cryptocurrency, or commodities. TREP tokens are subject to substantial restrictions on transfer. No secondary market currently exists for trading in TREP Tokens, and there is no assurance that one will develop. Investors may be required to hold their Tokens for a minimum of twelve (12) months from the date of purchase.

 

Investing in TREP Tokens involves a high degree of risk and is suitable only for Investors of substantial means and who have no need for liquidity in the foreseeable future with regard to investment. Please carefully review the section of this Memorandum titled “Risk Factors.”

 

	Offering Price (1)(2)	Offering Fee (3)(4)	Proceeds to Company (4)(5)
Per Token	$1.00	$0.002	$0.998
Maximum Tokens Sold	$50,000,000	$100,000	$49,900,000

 

(1)       The Company may offer a discount on the Offering Price during the pre-launch period for the early investors. The discount rate, applicability, and extension shall be offered at the Company’s sole discretion. However, the minimum investment amount during the pre-launch period remains $50,000 for investors who qualify under Regulation “D” and $1,000 for investors who qualify under Regulation “S” private offering.

 

(2)       The Company intends to raise between $2.0 - $2.5 million which represent approximately five percent (5%) of the authorized Units of Class B and Class C combined during TREP’s Pre-Launch offering. The remaining authorized units are kept in reserve for issuing units for TREP’s token swaps, bonus issues, and dividend payments, if any.

 

(3)       All Offering costs, including primarily legal, accounting and marketing expenses to our counsel, auditor, accounting firm, consultants, and advisors, will be reimbursed to the Managing Member from the capital raised. At present, this amount is expected to be $100,000.

 

(4)       The Offering costs do not include compensation paid, if any, to the broker-dealer(s) or broker-dealers’ selling commission applicable to its sales of this Offering. The Company may engage one or more broker-dealer to sell its securities under this Offering for compensation reflective of the amount of securities sold.

 

(5)       We are offering up to fifty million ($50,000,000) Tokens on a “best efforts” basis with a minimum amount of fifty thousand ($50,000) purchase for accredited investors and one thousand ($1,000) for foreign, non-U.S investors. No assurance can be given that all or any portion of TREP Tokens offered hereby will be sold. TREP has not engaged a third-party bank or financial institution to act as an escrow agent. Investor funds will be placed in TREP’s general corporate bank account and immediately available for Company use. TREP is not required to raise any minimum amount in this Offering before it may utilize the funds received in this Offering. TREP may hold a series of closes (each, a “Closing”) on a rolling basis as funds and investment documents are received. This Offering will terminate on the earlier of (i) the date at which the Maximum Offering Amount in this Offering has been sold, (ii) the date at which a registered offering pursuant to Regulation A+ is qualified by the SEC, or (iii) the date at which the Company decides to terminate or extend this offering at any time in its sole discretion in accordance with applicable SEC regulations.

 

 

 

 

IMPORTANT NOTICES

 

THE INTERESTS, OR TOKENS (THE “SECURITIES”), OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR FOREIGN JURISDICTION AND ARE BEING OFFERED AND ARE BEING SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH STATE OR FOREIGN JURISDICTION LAWS. THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED

UNDER THE SECURITIES ACT AND SUCH LAWS PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. OFFEREES SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE

SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY DOMESTIC OR FOREIGN, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THIS MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL. THE SECURITIES MAY BE SOLD ONLY TO “ACCREDITED” INVESTORS” OR TO NON-U.S. PERSONS AS DEFINED IN REGULATION S.

 

THIS MEMORANDUM DOES NOT CONSTITUTE AN OFFER OR SOLICITATION IN ANY STATE OR OTHER JURISDICTION IN WHICH AN OFFER OR SOLICITATION IS NOT LAWFUL OR AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO.

 

THE CONTENTS OF THIS MEMORANDUM SHOULD NOT BE CONSTRUED AS INVESTMENT, LEGAL, OR TAX ADVICE. EACH PROSPECTIVE INVESTOR IS URGED TO SEEK INDEPENDENT INVESTMENT LEGAL AND TAX ADVICE CONCERNING THE CONSEQUENCES OF INVESTING IN OUR COMPANY. THE PURCHASE OF THE SECURITIES SHOULD BE CONSIDERED ONLY BY PERSONS WHO UNDERSTAND OR WHO HAVE BEEN ADVISED OF THE NATURE OF, THE TAX CONSEQUENCE OF, AND THE RISK FACTORS ASSOCIATED WITH, SUCH INVESTMENT AND CAN AFFORD A TOTAL LOSS OF THEIR INVESTMENT WITHOUT MATERIALLY ADVERSE CONSEQUENCES TO THEIR STANDARD OF LIVING. OFFEREES MUST RELY ONLY ON THE ADVICE OF THEIR OWN LEGAL, ECONOMIC AND TAX ADVISORS IN ANALYZING THE ACCURACY OF THE PRESENTATIONS, ESTIMATES, FORECASTS, AND LEGAL CONCLUSIONS CONTAINED IN THIS MEMORANDUM. IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE COMPANY, THIS MEMORANDUM AND EXHIBITS HERETO, AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED.

 

ANY ESTIMATES AND FORECASTS CONTAINED IN THIS MEMORANDUM ARE BASED ON ASSUMPTIONS AND HYPOTHESES, THE ACCURACY OF WHICH IS SUBJECT TO SUBSTANTIAL RISKS AND CONTINGENCIES BOTH INITIALLY AND THROUGHOUT THE EXISTENCE OF OUR COMPANY. THEY ARE ILLUSTRATIVE ONLY, AND EACH OFFEREE IS URGED TO CONSULT WITH HIS/HER OR ITS OWN LEGAL, ECONOMIC, AND TAX ADVISORS WHO SHOULD, ON THE BASIS OF THEIR OWN EXPERTISE AND EXPERIENCE, RENDER THEIR ESTIMATES AND FORECASTS ON WHICH THE OFFEREE SHOULD RELY.

 

THIS OFFERING CAN BE WITHDRAWN AT ANY TIME BEFORE A CLOSING AND IS SPECIFICALLY MADE SUBJECT TO THE TERMS DESCRIBED IN THIS MEMORANDUM AND SET FORTH IN THE DEFINITIVE TRANSACTION DOCUMENTS. WE RESERVE THE RIGHT TO REJECT ANY SUBSCRIPTION, IN WHOLE OR IN PART, OR TO ALLOT TO ANY PROSPECTIVE INVESTOR LESS THAN THE NUMBER OF SECURITIES SUBSCRIBED FOR BY SUCH PROSPECTIVE INVESTOR.

 

THE AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES LAWS FOR THE SALE OF THE SECURITIES HEREBY, DEPENDS IN PART UPON FULL COMPLIANCE WITH ALL PROVISIONS OF SECTION 4(a)(2) OF THE SECURITIES ACT AND/OR RULE 506 OF REGULATION D, OR REGULATION S, AS APPLICABLE. EACH INVESTOR WILL BE REQUIRED TO REPRESENT TO US THAT HE IS KNOWLEDGEABLE ABOUT AND EXPERIENCED IN INVESTMENTS OF THIS TYPE AND THAT HE IS ABLE TO BEAR THE ECONOMIC RISK OF THIS INVESTMENT FOR AN INDEFINITE PERIOD.

 

NO ACTION HAS BEEN TAKEN IN ANY JURISDICTION TO PERMIT A PUBLIC OFFERING OF THE SECURITIES. THERE IS NO PUBLIC MARKET FOR THE SECURITIES, AND NONE IS EXPECTED TO DEVELOP IN THE FUTURE. ANY SUMS INVESTED IN THE COMPANY ARE ALSO SUBJECT TO SUBSTANTIAL RESTRICTIONS UPON WITHDRAWAL AND TRANSFER. THE SECURITIES OFFERED HEREBY SHOULD BE PURCHASED ONLY BY PURCHASERS WHO HAVE NO NEED FOR LIQUIDITY IN THEIR INVESTMENT.

 

NO LEGAL, ACCOUNTING, OR BUSINESS ADVISORS RETAINED BY US FOR THE PREPARATION OF THIS MEMORANDUM SHALL BE LIABLE TO ANY INVESTOR FOR MALPRACTICE OR OTHERWISE, EXCEPT IN THE EVENT OF ACTIONABLE FRAUD. FURTHERMORE, SUBSIDIARIES, AFFILIATES, TRUSTEES, BENEFICIARIES, OFFICERS, OR DIRECTORS THEREOF WILL NOT BE LIABLE TO INVESTORS FOR ANY REASON, EXCEPT IN THE EVENT OF SUCH PERSON’S MATERIAL: (1) MISREPRESENTATIONS; (2) INTENTIONAL OMISSIONS; OR (3) RECKLESSNESS.

 

OFFEREES ARE HEREBY INVITED TO ARRANGE FOR MEETINGS WITH OUR MANAGING MEMBER OR ITS DULY AUTHORIZED REPRESENTATIVES TO DISCUSS THE TERMS OF THIS OFFERING OR ANY OF THE MATTERS DISCUSSED HEREIN. AT ANY SUCH MEETING, REPRESENTATIVES OF OUR MANAGING MEMBERS WILL ALSO ANSWER ANY MATERIAL QUESTIONS RAISED BY PROSPECTIVE INVESTORS. OFFEREES ARE INVITED TO REQUEST FROM OUR MANAGING MEMBER COPIES OF ANY DOCUMENTS OR INSTRUMENTS WHICH AN OFFEREE DEEMS MATERIAL TO HIS HER OR ITS INVESTMENT DECISION.

 

INVESTING IN THE TREP TOKENS INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD CAREFULLY CONSIDER THE RISKS SUMMARIZED UNDER “RISK FACTORS” IN THIS MEMORANDUM FOR A DISCUSSION OF IMPORTANT FACTORS YOU SHOULD CONSIDER BEFORE PURCHASING TREP TOKENS.

 

THIS MEMORANDUM CONTAINS A SUMMARY OF CERTAIN PROVISIONS OF THE DOCUMENTS ASSOCIATED WITH INVESTMENT IN THE SECURITIES AND SUMMARIES OF VARIOUS PROVISIONS OF RELEVANT STATUTES AND OF REGULATIONS PROMULGATED THEREUNDER. WHILE OUR MANAGEMENT BELIEVES THAT THESE SUMMARIES FAIRLY REFLECT THE SUBSTANCE OF SUCH DOCUMENTS, STATUTES, OR REGULATIONS, THE SUMMARIES DO NOT PURPORT TO BE COMPLETE, OR, IN LIGHT OF THE DYNAMIC NATURE OF GOVERNMENT STATUTES OR REGULATIONS, PURPORT TO REFLECT ACCURATELY EITHER CURRENT STATUTES OR REGULATIONS OR CORRECT BINDING INTERPRETATIONS THEREOF.

 

CONSEQUENTLY, ALL SUCH SUMMARIES ARE QUALIFIED IN THEIR ENTIRETY BY REFERENCE TO THE TEXTS OF THE ORIGINAL DOCUMENTS, STATUTES AND REGULATIONS.

 

PROSPECTIVE INVESTORS ARE EXPECTED TO CONDUCT THEIR OWN INQUIRIES INTO THE COMPANY, AND ITS MANAGING MEMBER, OFFICERS, AFFILIATES, AND BUSINESS AND OPERATIONS. EACH OFFEREE MAY, IF HE OR SHE SO DESIRES, MAKE INQUIRIES OF APPROPRIATE MEMBERS OF MANAGEMENT OF OUR COMPANY WITH RESPECT TO OUR BUSINESS OR ANY OTHER MATTERS SET FORTH HEREIN, AND MAY OBTAIN ANY ADDITIONAL INFORMATION WHICH SUCH PERSON DEEMS TO BE NECESSARY IN ORDER TO

VERIFY THE ACCURACY OF THE INFORMATION CONTAINED IN THIS MEMORANDUM (TO THE EXTENT THAT WE POSSESS SUCH INFORMATION OR CAN ACQUIRE IT WITHOUT UNREASONABLE EFFORT OR EXPENSE). IN CONNECTION WITH SUCH INQUIRY, ANY DOCUMENTS THAT ANY OFFEREE WISHES TO REVIEW WILL BE MADE AVAILABLE FOR INSPECTION AND COPYING.

 

JURISDICTIONAL NOTICES

 

Appendix A to this Memorandum contains several important legends that we are required to disclose to investors under the various jurisdictional laws where different investors may reside. It is important that you review applicable jurisdictional legends contained in Appendix A carefully so that you are informed of your rights and other important information relating to your investment decision.

 

CONFIDENTIALITY AND RELATED MATTERS

 

Each recipient hereof agrees by accepting this Memorandum that the information contained herein is of a confidential nature and that such recipient will treat such information in a strictly confidential manner and that such recipient will not, directly or indirectly, disclose or permit its affiliates or representatives to disclose, any information to any other person or entity, or reproduce such information, in whole or in part, without our prior written consent. The recipient of this Memorandum further agrees to use the information solely for the purpose of analyzing the desirability of an investment in our company to such recipient and for no other purpose whatsoever.

 

The foregoing obligation will not apply to information that: (i) at the time of disclosure by us is, or thereafter becomes, generally available to the public, other than as a direct result of a breach by you of the above confidentiality obligations; (ii) prior to or at the time of disclosure by us, was already in your possession; or (iii) at the time of disclosure by us or thereafter, is obtained by you or any of your affiliates from a third party whom you reasonably believe to be in possession of the information not in violation of any contractual, legal or fiduciary obligation to us or our affiliates with respect to that information.

 

CAUTIONARY NOTE ON FORWARD LOOKING STATEMENTS

 

This Memorandum contains forward-looking statements, including statements relating to TREP’s operations, financial results, business, and products. Other statements in this Memorandum, including words such as “anticipate,” “may,” “believe,” “could,” “should,” “estimate,” “expect,” “intend,” “plan,” “predict,” “potential,” “forecasts,” “project,” and other similar expressions, also are forward-looking statements. Forward-looking statements are made based upon management’s current expectations and beliefs concerning future developments and their potential effects on TREP. Such forward-looking statements are not guarantees of future performance. The following important factors and those important factors described elsewhere in this offering memorandum, including the matters set forth under the section entitled “Risk Factors,” could affect (and in some cases have affected) TREP’s actual results and could cause such results to differ materially from estimates or expectations reflected in such forward-looking statements:

 

• the use of the net proceeds of this Offering;

 

• our goals and strategies;

 

• our future business development, financial condition, and results of operations;

 

• our future capital needs and costs of acquiring and maintaining our underlying assets;

 

• our expectations regarding demand for our TREP Tokens;

 

• market trends in the rental and investment real estate industry and related changes;

 

• trends in the market value of cryptocurrencies;

 

• general economic and business conditions in the United States and in local real estate markets;

 

• there is no assurance that purchasers of TREP Tokens will receive a return on their investments;

 

• the lack of secondary operational markets or market makers for our TREP Tokens and security tokens in general;

 

• the slowing or stopping of the development or acceptance of blockchain networks and blockchain assets would have an adverse material effect on the successful development and adoption of TREP Tokens;

 

• the popularity of cryptocurrencies and crypto securities offerings may decrease in the future, which could have a material impact on TREP’s operations and financial conditions;

 

• TREP has limited operating history, which makes it hard to evaluate its ability to generate revenue through operations; and

 

• Cybersecurity breaches and attacks.

 

Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by the use of the words “may,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. Actual results, performance, liquidity, financial condition, prospects, and opportunities could differ materially from those expressed in, or implied by, these forward-looking statements as a result of various risks, uncertainties, and other factors, including the ability to raise sufficient capital to continue our company’s operations. These statements may be found under “Management’s Discussion and Analysis” and “Business,” as well as in this Memorandum generally. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including, without limitation, the risks outlined under “Risk Factors” and matters described in this Memorandum generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this Memorandum will in fact, occur.

 

Potential investors should not place undue reliance on any forward-looking statements. Except as required by the federal securities laws, there is no undertaking to update or revise any forward-looking statements publicly, whether as a result of new information, future events, changed circumstances, or any other reason.

 

The specific discussions herein about our Company include financial projections and future estimates and expectations about our Company’s business. The projections, estimates, and expectations are presented in this Memorandum only as a guide about future possibilities and do not represent actual amounts or assured events. All the projections and estimates are based exclusively on our company management’s own assessment of its business, the industry in which it works, the economy at large, and other operational factors, including capital resources and liquidity, financial condition, fulfillment of contracts, and opportunities. The actual results may differ significantly from the projections.

 

Potential investors should not make an investment decision based solely on our Company’s projections, estimates, or expectations.

 

COMMUNICATIONS AND INQUIRIES

 

ALL COMMUNICATIONS AND INQUIRIES RELATED TO THIS MEMORANDUM SHOULD BE DIRECTED TO THE AUTHORIZED OFFICERS OF THE COMPANY AS INDICATED BELOW. THE INDIVIDUALS BELOW WILL MAKE THEMSELVES AVAILABLE AT A REASONABLE TIME PRIOR TO YOUR PURCHASE TO ANSWER YOUR QUESTIONS AND PROVIDE INFORMATION IN ADDITION TO WHAT IS IN THIS MEMORANDUM.

 

Managing Member

 

Jay Patel

Chief Executive Officer

+1.224.328.5300

jp@trep.co

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TABLE OF CONTENTS

 

IMPORTANT NOTICES.. 5

JURISDICTIONAL NOTICES.. 8

CONFIDENTIALITY AND RELATED MATTERS.. 8

CAUTIONARY NOTE ON FORWARD LOOKING STATEMENTS.. 8

SUMMARY.. 13

THE COMPANY.. 13

OFFERING SUMMARY.. 18

RISK FACTORS.. 24

PLAN OF DISTRIBUTION.. 35

USE OF PROCEEDS.. 45

DESCRIPTION OF BUSINESS.. 46

DIRECTORS, EXECUTIVE OFFICERS, AND SIGNIFICANT EMPLOYEES.. 50

SECURITIES BEING OFFERED.. 51

 

APPENDIX A – JURISDICTIONAL NOTES

 

EXHIBIT A – OPERATING AGREEMENT

 

EXHIBIT B – INVESTOR QUESTIONNAIRE

 

EXHIBIT C – SUBSCRIPTION AGREEMENT

 

 

SUMMARY

 

The following summary highlights selected information contained in the Memorandum. The summary does not contain all the information that may be important to you. You should carefully read all of the information in this Memorandum, including, but not limited to, the risks associated with an investment in the Company’s securities discussed in the “Risk Factors” section of this offering circular.

 

THE COMPANY

 

Company Overview – Our Mission

 

TREP, LLC is a Wyoming limited liability company with its headquarters in Chicago, Illinois (“TREP,” “TREP Token,” “Token,” “we,” “our,” “us,” or the “Company”). The Company was formed in February 2022 to permit public investment in a range of asset classes, including commercial, residential, mixed-used real estate, tax lien certificates, TLC managed funds, government securities, cryptocurrencies, and asset-backed tokens. We believe people should have the freedom to move around to pursue new investment opportunities while still having access to the wealth creation that long-term real estate and stable instruments can provide. To support this idea, we are building what we believe to be a new model for ownership and leveraging real estate investment that doesn't lock people into a single investment portfolio. We believe in passive income, diversification, freedom to move, and aligned investment incentives.

 

TREP is a platform for investing in real estate and high-quality instruments. We buy commercial, residential, and mixed-use properties, lease them, divide them into multiple interests, and offer them as investments on a per-interest basis through our Token. Investors risks are managed by swapping a portion of their investment with TREP Tokens in exchange for other crypto tokens issued by the Company. They can invest in all real estate and instruments that TREP invests in without needing to invest in each offering individually. Investors can invest in income-generating real estate and high-yield, low-risk instruments without having to worry about the technicalities of each investment.

  

TREP does all of the work of sourcing, analyzing, maintaining, and managing the real estate properties that we acquire. We also engage third-party contractors to carry out maintenance, remodeling, and repair work for our properties. We analyze every property across several financial, market, and demographic characteristics to support our acquisition decision-making. Every property or instrument that we invest in is in the communities that TREP operates, alongside other like-minded individuals. As our community network grows, so does our access to investment and investment opportunities.

 

TREP is considering undertaking a security offering under the exemption from registration of security provided by Regulation A of the Securities Act of 1933, as amended. This exemption would allow us to raise up to $75 million from investors. As of the date of this Memorandum, we have not filed with the SEC for such an offering.

Investment Objectives

 

Our primary investment objectives are:

 

• Consistent cash flow;

 

• Long term capital appreciation with moderate leverage;

 

• Favorable tax treatment of real estate income and long term capital gains; and

 

• Capital preservation

 

We cannot assure you that we will attain these objectives or that the value of our assets will not decrease.

 

Investment Strategy

 

Our investment strategy is to acquire, invest in, manage and operate properties on an opportunistic basis, which may consist of a wide variety of residential and commercial rental properties, including single-family, multi-family, office, industrial, hospitality, recreation, and leisure, and other real properties. We intend to leverage our industry experience and our proprietary technology to help streamline our property acquisition process.

 

In addition, we will invest in tax lien certificates, tax lien management funds, government securities, and asset-backed securities to generate a regular stream of cash flow for our investors. We will focus on investing in instruments such as tax liens and tax deeds because of the relatively low capital requirements, the potential returns, and the ability to be involved in real estate without much of the responsibility of owning and/or managing the actual property.

 

Our future LLCs and syndications will focus on acquiring market ready properties, which may include income-generating properties or newly constructed properties, in areas with growing rental demand, strong rental history and in geographic regions which provides steady real estate growth. We expect to target cities across the globe with growing populations and strong rental demand.

 

TREP as a company intends to participate in each LLC and syndication by acquiring a twenty five (25%) interest in the target LLC or syndication through an equity swap of TREP tokens in exchange for the tokens of the target LLC or syndication held by the investors. The exchange ratio of the tokens will be determined at the time of the equity swap based upon the value of TREP Tokens.  For example, if $250,000 in tokens is received from the syndication, TREP will provide equal value of TREP Tokens to syndicate investors.  The price of TREP tokens will be determined by the closing value of TREP at the end of that business day (5:00 PM E.T.).  

 

Investment Process

 

The Manager has the authority to make all the decisions regarding the Company and its offered syndicate investment, objectives, and leverage policies to the limitations provided in each syndication’s offering document.

 

The Manager will focus on sourcing, acquiring, and managing residential, commercial, and mix-used properties. Furthermore, the Manager may also invest in tax lien certificates, tax lien managed funds, government securities, and asset-backed securities to generate a regular cash flow for our investors.

 

All property acquisitions, whether they are TREP portfolio properties or a syndication, must go through a stringent qualification process consisting of numerous metrics including but not limited to:

 

1. Quality and value of location


2. Tenant history


3. Strength of current lease agreements


4. Evaluation of past delinquencies and evictions


5. Rental yield of property


6. Potential for rent increases


7. Potential market value appreciation


8. Deferred maintenance


9. Micro and macro industry factors including local employment statistics


10. Quality of clear title

 

Once a property passes these tests, it may qualify to become syndicated or purchased directly by TREP.

 

Impact of the COVID-19 Coronavirus Pandemic

 

In March 2020, the novel coronavirus (“COVID-19”) outbreak was declared a global pandemic by the World Health Organization, and since then, the virus has continued to spread throughout the world. The severe travel and social restrictions, including social distancing, “shelter-in-place” orders, and restrictions on the types of businesses that may continue to operate that have been implemented in the United States and the world, have adversely impacted global activity and contributed to significant volatility in financial markets. The ultimate impacts of the outbreak remain unknown and are rapidly evolving.

 

The pandemic’s duration and severity and the extent of the adverse health impact on the general population and the local population where our Properties are and will be located are unknown. These, among other items, will likely impact the economy, the unemployment rate, and our operations and could materially affect our future consolidated results of operations, financial condition, liquidity, investments, and overall performance. For more information, please see the section entitled “Risk Factors.”

 

Tokens Being Offered

 

Investors will acquire membership in the Company through cryptographic digital tokens meeting the ERC-3643 standard (the “Token”). It is intended that the owners of Token in the Company will have assets, liabilities, profits, and losses pertaining to investments made by the Company. See the “Description of Securities Offered” section for further details. The minimum investment that a U.S. person can make is a minimum of fifty thousand (50,000) Tokens at an aggregate purchase price of $50,000.00 to participate in this Offering, although TREP, in its sole discretion, may determine to accept a lesser amount. Investors who are not included in the Regulation S definition of “U.S. persons” investing under the Regulation S exemption may purchase a minimum of one thousand (1,000) Tokens at an aggregated purchase price of $1,000.00 to participate in this Offering.

 

The Manager

 

Our company is managed by a Board of Managers, which we refer to herein as the “manager.” Pursuant to the terms of our company’s limited liability company operating agreement, which we refer to as the “operating agreement,” the manager will provide certain management and advisory services to our company, as well as a management team and appropriate support personnel.

 

Property Manager

 

The Company will appoint / hire a local third-party property management company to serve as a property manager to manage the properties TREP syndicates or purchases for its own holdings pursuant to a property management agreement.

 

Property Management Fees

 

As compensation for the services provided by the property manager, the Company will be charged a property management fee up to ten percent (10%) of rents collected on each property. If a property is vacant and not producing rental income, the property management fee will not be paid during any such period of vacancy.  Additional fees relating to maintenance and upkeep can vary from company to company, but must be competitive in that specific market.

 

Property Disposition Fee

 

Upon the disposition and sale of a syndication property, each syndication will be charged a market rate property disposition fee by TREP that will cover property sale expenses. It is expected that this disposition fee charged to a syndication will equal to one percent (1%) of the property sale price. 

 

 

Distribution Rights

 

The manager has sole discretion in determining what distributions if any, are made to the Token holders except as otherwise limited by law or the operating agreement. Our company expects the manager to market distributions on a quarterly basis commencing in the second financial year of the Company. However, the manager may change the timing of distributions or determine that no distribution shall be made at its sole discretion.

 

Timings of distributions for syndication investors are different from distributions for TREP investors.  We intend to provide Syndication investors monthly distributions from the rental income earned in that specific property.

 

Additionally, with respect to dividend distributions, the Company shall pay the amount of dividends in the form of TREP Tokens or fiat currency. In the event the distribution is made in the form of TREP Tokens, such tokens shall have a transferring restriction of one (1) year from the distribution date.  Investors may choose their preferred form of distribution (newly issued TREP tokens or fiat currency).

 

Our Company Information

 

Our principal executive offices are located at 1309 Coffeen Avenue, STE 1200, Sheridan, Wyoming 82801. Our telephone number is +1.224.328.5300. We maintain a website at www.trep.co. Information contained on or accessible through our website is not incorporated by reference into and does not constitute a part of this Memorandum or any other documents provided in support of this Offering.

 

 

OFFERING SUMMARY

 

Securities being offered:	We are offering the maximum number of interest in the Company at a price of $1.00 per Token for 50,000,000 Tokens for a maximum aggregate amount of $50,000,000.   The Offering is being conducted on a “best efforts,” not offering a minimum basis.
TREP Token:	The interest will be issued in the form of a cryptographic digital token referred to herein as “Token.” TREP Tokens are a new series of Ethereum block-chain-based smart contract digital tokens consisting of software code meeting the ERC-3643 protocol standard as modified to meet transfer restriction requirements under applicable U.S. securities law.
Offering Price per Token:	The Offering Price per Token is $1.00
Investment Minimum:	The minimum investment amount by an Investor who is a U.S. Person is fifty thousand ($50,000) dollars in the form of fifty thousand (50,000) Tokens, although the Company, in its sole discretion, may determine to accept a lesser amount. Investors who are excluded from the Regulation S definition of “U.S. persons” investing under Regulation S exemption may purchase a minimum of one thousand (1,000) Tokens.
Broker:	We may engage a third-party broker-dealer, which will act as our soliciting agent and executing broker in connection with our Token offering.
Broker Fees:	Broker’s or finder’s fee or commission in the amount of 3% to 6% shall be payable with respect to any amount raised by broker-dealers, placement agents, or consultants under this Offering.
Form of Payment:	The Offering Price of TREP Tokens will be designated in U.S. Dollars. Purchases of TREP Tokens will be paid for in U.S. Dollars, although the Company, in its sole discretion, may determine to accept Bitcoin (“BTC”), Ethereum (“ETH”), or other cryptocurrencies or digital tokens as payment for TREP Tokens.
Exchange Rates for Purchases:	Determination of the number of TREP Tokens Issued For BTC and ETH   For purposes hereof, the “Purchaser Commitment Amount” means the aggregate amount of ETH or BTC delivered by a Subscriber to the Company pursuant to the Subscription Agreement.   BTC payments:   The Token Amount for BTC payments will be determined by the Company based upon the USD equivalent of the Purchaser Commitment Amount received by the Company, based upon the last traded price for a BTC to USD exchange transaction, as reflected on www.coinbase.com (“Coinbase”) which is closest to and includes (but is not after) 5:00:00 p.m. (E.T.), on the date on which the BTC Receipt Day End Time occurs (the “BTC Exchange Rate”). The Token Amount shall be calculated by dividing this USD equivalent Purchaser Commitment Amount by the per TREP Tokens USD price.   ETH Payments:   The Token Amount for ETH payments will be determined by the Company based upon the USD equivalent of the Purchaser Commitment Amount received by the Company, based upon the last price quoted for an ETH to USD exchange transaction, as reflected on Coinbase, which is closest to and includes (but is not after) 5:00:00 p.m. (E.T.), on the date on which the ETH Receipt Day End Time occurs (the “ETH Exchange Rate”). The Token Amount shall be calculated by dividing this USD equivalent Purchaser Commitment Amount by the per TREP Tokens USD price.   Determination of number of TREP Tokens Issued For other crypto tokens   The number of TREP Tokens which a Subscriber shall be entitled to receiving in exchange for other crypto tokens (the “Token Amount”) shall be determined based on the fair evaluation of the crypto token (as defined below) and token price quote by the issuer in USD, as applicable, for the Receipt Day on which the Company received the Purchasers Commitment Token Amount. The term “Receipt Day” means the period from, and including, 5:00:00 p.m. (E.T.) on a calendar day (the “Receipt Day Start Time”) and 5:00:00 p.m. (E.T.) on the succeeding business day (the “Receipt Day End Time”).   For purposes hereof, the “Purchasers Commitment Token Amount” means the aggregate amount of other crypto tokens delivered by a Subscriber to the Company pursuant to the Subscription Agreement.   Other crypto token payments:   The Token Amount for other crypto tokens will be determined by the Company based upon the price of the token presented by the issuer and fair evaluation. The evaluation of crypto tokens is based on a number of quantities techniques, including asset pricing model, market risks, annual income revenue, risk factors that determine the use of blockchain technology, and liquidity such as token reserves or excess cash flows.
Digital Wallets:	The Company will use an ERC-3643 compatible smart contract for its Tokens. As is normal for ERC-3643 tokens, TREP Tokens will be stored on the Ethereum blockchain in a smart contract.
Consideration:	During the pre-launch period, the Company may offer to sell TREP Tokens at a discount to early investors. The discount rate, applicability, and extension shall be offered in the Company’s sole discretion.
Best Efforts:	This Offering is being made on a “best-efforts” basis. The Company or any of its future syndications does not warrant that all 50,000,000 TREP Tokens will be sold and reserves the right to terminate the Offering prior to the sale of all TREP Tokens.
Restriction on Investment:	Each Investor: (a) if in the United States, or a U.S. Person (as defined in Regulation S under the Securities Act), must be a verified “accredited investor” (as defined in Regulation D under the Securities Act) or (b) if outside of the United States, must be an investor excluded from the Regulation S definition of a “U.S. Person” who is not Purchasing for the account or benefit of a U.S. Person (as defined under Regulation S) and who is eligible to purchase and hold TREP Tokens under the applicable laws of the Investor’s jurisdiction. In the United States, the Offering is being conducted pursuant to Rule 506(c) of Regulation D under the Securities Act.
Use of proceeds:	We will use the proceeds from this Offering to complete the development of the Company and to invest in the following assets:   (i)            Commercial, Residential and Mixed-Use properties;   (ii)          Tax Lien Certificates (TLCs) or TLC Managed Funds;   (iii)         Real Estate;   (iv)         Government Securities; and   (v)          Asset-Backed Securities, including but not limited to digital tokens issued by our syndication entities.
Rights of Tokens:	Holder of Tokens are not entitled to vote with respect to any Company affairs, including but not limited to any meetings, amendments, rights of Token holders, and any decision in the Company that requires a vote.
Risk Factors:	Investing in the interest of the Company involves risks. See the section entitled “Risk Factors” in this Memorandum for a discussion of factors you should carefully consider before deciding to invest.
Best Efforts:	This Offering is being made on a “best-effort” basis. The Company does not warrant that all 50,000,000 Tokens will be sold and reserves the right to terminate the Offering prior to the sale of all Tokens.
Termination of the Offering:	This Offering will terminate on the first of: (i) the date at which the Maximum Offering is sold; (ii) the date at which a registered offering pursuant to Regulation A+ is qualified by the SEC, or (iii) the Company decides to terminate or extend this offering at any time in its sole discretion in accordance with the applicable SEC regulations.
Conversion of Tokens	If the Company issues similar tokens (“TREP Reg A Tokens”) in a registered offering or offering qualified under Regulation A of the Securities Act of 1933 then TREP Tokens, and any accrued or paid interest tokens thereon, will automatically convert into the TREP Reg A Tokens issued pursuant to a registered offering on a conversion ratio of one-to-one for each Reg D token.
Subscription Procedure:	To subscribe for Tokens, complete and execute the Subscription Agreement and the Investor Questionnaire accompanying this offering circular and deliver it to us together with full payment for all Tokens subscribed for in accordance with the instructions provided in the Subscription Agreement. Once you subscribe, subject to acceptance by us, your subscription is irrevocable. We have the right, at any time prior to the issuance of TREP Tokens, to reject subscriptions in our sole discretion.

 

 

 

RISK FACTORS

 

The Interests, in the form of Tokens, offered hereby are highly speculative in nature, involve a high degree of risk, and should be purchased only by persons who can afford to lose their entire investment. There can be no assurance that the Company’s investment objectives will be achieved or that a secondary market would ever develop for the Interests, whether via the TREP’s Website, via the third-party registered broker-dealers, or otherwise. The risks described in this section should not be considered an exhaustive list of the risks that prospective Investors should consider before investing in TREP Tokens. Prospective Investors should obtain their own legal and tax advice prior to making an investment in TREP Tokens and should be aware that an investment in TREP Tokens may be exposed to other risks of an exceptional nature from time to time. The following considerations are among those that should be carefully evaluated before making an investment in TREP Tokens.

Risks Related to the Structure, Operations, and Performance of TREP, LLC

 

An investment in the Offering constitutes only an investment in the Company or the underlying asset.

 

The investment does not grant voting rights to investors on any matters relating to the governance of the company or amendments to the Operating Agreement. In addition, the economic interest in the Company will not be identical to owning a direct undivided interest in the underlying asset owned by any syndication of the Company.

 

TREP, LLC was recently formed has no track record and no operating history from which you can evaluate TREP or this investment.

 

The Company has been recently formed and has not generated any revenues and have no operating history upon which prospective Investors may evaluate its performance. No guarantee can be given that the Company will achieve their investment objectives, the value of the Underlying Asset will increase, or the Underlying Asset will be successfully monetized or tokenized.

 

Given our start-up nature, investors may not be interested in making an investment, and we may not be able to raise all of the capital for this Offering or any future syndication, and this could have a material adverse effect upon our Company and the value of your Interests.

Due to the start-up nature of TREP, there can be no guarantee that we will reach our funding target from potential Investors for this Offering or future proposed interests in any syndication. In the event we do not reach a funding target, we may not be able to achieve our investment objectives by acquiring additional underlying assets through the issuance of further interests in any syndication and monetizing them together with the Underlying Asset to generate distributions for Investors. If we are unable to raise funding for additional interests in any syndication, this may impact any investors already holding interests as they will not see the benefits which arise from economies of scale following the acquisition by other interests of additional underlying assets and other monetization opportunities. Additionally, our failure to fund this or additional syndications could cause us to terminate the business without having achieved our business objectives, and you may experience difficulties in realizing a return on, or of, your investment.

Our success depends in large part upon our Managing Member and its ability to execute our business plan.

The successful operation of TREP (and, therefore, the success of the Interests) is in part dependent on the ability of the Managing Member and the Property Manager to source, acquire and manage the underlying assets. As the Managing Member has been recently engaged and is an early-stage startup company, it has no significant operating history within the real estate sector and/or investment sector, which evidences its ability to source, acquire, manage and utilize the underlying assets. Failure of the Managing Member to successfully operate and build our business could result in your losing your investment in the Company.

The success of TREP (and therefore, the Interests) will be highly dependent on the expertise and performance of the Managing Member and its team, its expert network, and other investment professionals (which include third-party experts) to source, acquire and manage the underlying assets. There can be no assurance that these individuals will continue to be associated with the Managing Member or the Property Manager. The loss of the services of one or more of these individuals could have a material adverse effect on the underlying assets, particularly their ongoing management and use to support the investment of the Interest Holders.

The power of attorney provisions of the Operating Agreement could act to impact an Investor’s investment in the Interests negatively.

Investors who purchase Interests will be bound by the provisions of the Operating Agreement, including those provisions pursuant to which the Investor grants to the Managing Member of a power of attorney to, among other things, execute and file documents required for TREP’s qualification, continuance or dissolution. This power of attorney also includes a provision pursuant to which the Investor waives any and all defenses that may be available to contest, negate or disaffirm the action of the Managing Member taken in good faith under a power of attorney. This power of attorney and waiver may limit the ability of an Investor to take certain actions the Investor deems prudent and could result in outcomes unfavorable to the Investor.

Potential breach of the security measures of the TREP’s Website could have a material adverse effect on TREP, its future syndications, and the value of your investment.

The highly automated nature of the TREP’s Website through which potential investors acquire or transfer interests may make it an attractive target and potentially vulnerable to cyber-attacks, computer viruses, physical or electronic break-ins, or similar disruptions. TREP’s Website processes certain confidential information about investors, the Asset Sellers, and the underlying assets. While we intend to take commercially reasonable measures to protect our confidential information and maintain appropriate cybersecurity, the security measures of TREP’s Website, the Managing Member, or our service providers could be breached. Any accidental or willful security breaches or other unauthorized access to TREP’s Website could cause confidential information to be stolen and used for criminal purposes or have other harmful effects. Security breaches or unauthorized access to confidential information could also expose us to liability related to the loss of the information, time-consuming and expensive litigation and negative publicity, or loss of the proprietary nature of the Managing Member’s and TREP’s trade secrets. If security measures are breached because of third-party action, employee error, malfeasance or otherwise, or if design flaws in the TREP’s Website software are exposed and exploited, the relationships between TREP, investors, users, and the Asset Sellers could be severely damaged, and TREP or the Managing Member could incur significant liability or have their attention significantly diverted from the utilization of the underlying assets, which could have a material negative impact on the value of interests or the potential for distributions to be made on the interests.

 

Non-compliance with regulations may result in the abrupt cessation of business operations, recission of any contracts entered into, early termination of any interests sold, or if TREP were deemed to be subject to the Investment Advisers Act, the liquidation and winding up of the company or any Tokens sold.

 

The Interests are being sold by the Managing Member, which is not a registered broker-dealer under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and which will not be registered in each state where the Offering and sale of the Interests will occur. If a regulatory authority determines that the Managing Member, who is not a registered broker-dealer under the Exchange Act or any state securities laws, has itself engaged in brokerage activities, the Managing Member may need to stop operating and, therefore, TREP may not have an entity managing the Underlying Asset. In addition, if the Managing Member is required to register as a “broker-dealer,” there is a risk that any interests offered and sold while the Managing Member was not registered may be subject to a right of rescission, which may result in the early termination of the syndication.

 

Furthermore, TREP is not registered and will not be registered as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”), and neither the Managing Member nor the Property Manager is or will be registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Investment Advisers Act”), and thus the Interests do not have the benefit of the protections of the Investment Company Act or the Investment Advisers Act. TREP and the Managing Member have taken the position that the underlying assets are not “securities” within the meaning of the Investment Company Act or the Investment Advisers Act, and thus TREP’s assets will comprise of less than 40% investment securities under the Investment Company Act, and the Managing Member and Property Manager will not be advising with respect to securities under the Investment Advisers Act. This position, however, is based upon applicable case law that is inherently subject to judgments and interpretation. If TREP were to be required to register under the Investment Company Act or the Managing Member were to be required to register under the Investment Advisers Act, it could have a material, and adverse impact on the results of operations and expenses of the syndication and the Managing Member may be forced to liquidate and wind up the syndication or rescind the Offering of the Interests or the offering for any other syndications.

 

Risks Related to the Real Estate Industry

 

The Company is expected to invest in real estate properties and securities described above. If there is a downturn in the industry or the economy in general, then the value of the underlying asset is likely to decrease.

 

Given the concentrated nature of the underlying assets (i.e., real estate property and other securities), any downturn in the real estate industry is likely to impact the value of the underlying assets and, consequently, the value of the Interest. Furthermore, the value of such investment property may be impacted if an economic downturn occurs and individuals have less disposable income to invest in products such as real estate-related securities. In the event of a downturn in the industry, the underlying asset's value is likely to decrease.

 

The geographic concentration of TREP’s investment properties and fluctuations in local and/or international markets may adversely impact TREP’s financial condition and results of operations.

 

TREP will own a relatively small number of properties located in a few geographic areas across the globe. As a result of this geographic concentration, if a local or international investment property market performs poorly, the income from the investment property in that market could decrease. The performance of the economy in each of these areas affects occupancy, market rental rates, and expenses, and consequently impacts the ability of Token to resell its projects to third parties on a timely basis and at a profit. Accordingly, economic downturns in the local and/or international markets in which TREP owns investment properties could have a negative impact on TREP’s cash flow and its ability to satisfy its financial obligations to Investors.

 

TREP may be adversely affected by increases in real estate operating costs.

 

Residential and commercial investment properties are subject to increases in operating expenses such as maintenance, insurance, administrative costs, and other general costs associated with security, landscaping, repairs, and maintenance. If operating expenses increase, competition in the local rental markets may limit the extent to which rents may be increased to meet increased expenses without decreasing occupancy rates, consequently impacting the ability of TREP to resell its properties to third parties on a timely basis and at a profit.

 

Risk Related to the Underlying Assets

 

Restoration or repair of the Underlying Asset may result in a decrease in the value of the Underlying Asset.

 

Although we do not intend to undertake restoration or repair of the Underlying Asset, there may be situations in the future that it is required to do so (e.g., due to natural wear and tear and through the use of such Underlying Asset). Where it does so, it will be dependent on the performance of third-party contractors and sub-contractors and we may be exposed to the risks that a project will not be completed within budget, within the agreed timeframe, or to the agreed specifications. While we will seek to mitigate our exposure by negotiating appropriate contracts, including appropriate warranty protection, any failure on the part of a contractor to perform its obligations could adversely impact the value of the Underlying Asset and, therefore, the value of the Interests.

 

Insurance may not cover all losses, which may result in an operating loss and the likelihood that distributions will not be made by us.

 

Insurance of the Underlying Asset may not cover all losses. There are certain types of losses, generally of a catastrophic nature, such as earthquakes, floods, hurricanes, terrorism or acts of war that may be uninsurable or not economically insurable. Inflation, environmental considerations, and other factors, including terrorism or acts of war, also might make insurance proceeds insufficient to repair or replace an asset if it is damaged or destroyed. Under such circumstances, the insurance proceeds received might not be adequate to restore our economic position with respect to any affected underlying assets. Furthermore, the interests in any syndication related to such affected underlying assets would bear the expense of the payment of any deductible. Any uninsured loss could result in both loss of cash flow from and the value of the affected underlying assets and, consequently, the interests in any syndication that relate to such underlying assets.

 

Risks Related to Potential Conflicts of Interest

 

Our Operating Agreement contains provisions that reduce or eliminate duties (including fiduciary duties) of the Managing Member.

 

Our Operating Agreement provides that the Managing Member, in exercising its rights in its capacity as the Managing Member, will be entitled to consider only such interests and factors as it desires, including its own interests, and will have no duty or obligation (fiduciary or otherwise) to give any consideration to any interest of or factors affecting us or any of our investors and will not be subject to any different standards imposed by our Operating Agreement, the LLC Act or under any other law, rule or regulation or in equity. These modifications of fiduciary duties are expressly permitted by Wyoming law. 

 

Ownership of multiple interests in any syndication may cause conflicts of interest.

 

The Managing Member or its affiliates may acquire interests in each syndication for their own accounts and may transfer these interests, either directly or through brokers, via the TREP’s Website, or otherwise. Depending on the timing of the transfers, this could impact the interests held by the investors (e.g., driving the price down because of supply and demand and over availability of interests). This ownership in each of the syndication may result in a divergence of interests between the Managing Member and the investors who only hold one or certain interests in any syndication (e.g., the Managing Member or its affiliates, once registered as a broker-dealer with the SEC, may disproportionately market or promote a certain syndication, in particular, where they are a significant owner so that there will be more demand and an increase in the price of such syndication).

 

Risks Related to this Offering and Ownership of our Interests

 

Transfer Restrictions imposed by our Operating Agreement may result in your not being able to sell your Tokens.

 

The Interests represented by the Token Holders are subject to restrictions on transferability. An Interest Holder may not transfer, assign or pledge its Interests for one (1) year from the purchase date of TREP Tokens. As a result of these limitations, you may not be able to sell your Tokens within the prescribed period mentioned above.

 

There is currently no public trading market for our securities.

 

There is currently no public trading market for the Interests, and an active market may not develop or be sustained. If an active public trading market for the Interests does not develop or is not sustained, it may be difficult or impossible for you to resell your Interests at any price. Even if a public market does develop, the market price could decline below the amount you paid for your Interests.

 

If a market ever develops for the Interests, the market price and trading volume of the Interests may be volatile.

 

If a market develops for the Interests, the market price of Interests could fluctuate significantly for many reasons, including reasons unrelated to our performance. The Underlying Assets or the Syndications, such as reports by industry analysts, investor perceptions, or announcements by our competitors regarding their own performance, as well as general economic and industry conditions. For example, to the extent that other companies, whether large or small, within our industry experience declines in their share price, the value of the Interests may decline as well.

 

In addition, fluctuations in operating results of a particular syndication or the failure of operating results to meet the expectations of investors may negatively impact the price of our securities. Operating results may fluctuate in the future due to a variety of factors that could negatively affect revenues or expenses in any particular reporting period, including the vulnerability of our business to a general economic downturn; changes in the laws that affect our operations; competition; compensation-related expenses; application of accounting standards; seasonality; and our ability to obtain and maintain all necessary government certifications or licenses to conduct our business.

 

There may be state law restrictions on an Investor’s ability to sell the Interests making it difficult to transfer, sell or otherwise dispose of the Interests.

 

Each state has its own securities laws, often called “blue sky” laws, which (1) limit sales of securities to a state’s residents unless the securities are registered in that state or qualify for an exemption from registration and (2) govern the reporting requirements for broker-dealers and stock brokers doing business directly or indirectly in the state. Before a security is sold in a state, there must be a registration in place to cover the transaction, or it must be exempt from registration. Also, the broker must be registered in that state. We do not know whether the Interests will be registered or exempt under the laws of any state. A determination regarding registration will be made by the broker-dealers, if any, who agree to serve as the market makers for the Interests. There may be significant state blue sky law restrictions on the ability of Investors to sell and on purchasers to buy the Interests. Investors should consider the resale market for the Interests to be limited. Investors may be unable to resell their Interests, or they may be unable to resell them without the significant expense of state registration or qualification.

 

Investors lack voting rights, and the Managing Member may take actions that are not in the best interest of Investors.

 

The Managing Member has a unilateral ability to amend the Operating Agreement and the allocation policy in certain circumstances without the consent of the Investors, and the Investors only have limited voting rights in respect of the Series. Investors will therefore be subject to any amendments the Managing Member makes (if any) to the Operating Agreement and allocation policy and also any decision it takes in respect of TREP and the Series, which the Investors do not get a right to vote upon. Investors may not necessarily agree with such amendments or decisions, and such amendments or decisions may not be in the best interest of all of the Investors as a whole but only a limited number.

 

Furthermore, the Managing Member can only be removed as Managing Member of TREP and as Manager of each syndication in a very limited circumstance, following a non-appealable judgment of a court of competent jurisdiction to have committed fraud in connection with TREP or a syndication. Investors would therefore not be able to remove the Managing Member merely because they did not agree, for example, with how the Managing Member was operating an underlying asset.

 

 

Risk Related to Blockchain Technology, the Ethereum Network, TREP Tokens, and Cryptocurrencies

 

The potential application of existing regulatory regimes governing blockchain technologies, cryptocurrencies, tokens, and token offerings such as the Token is not fully developed and so remains substantially uncertain in many respects. New regulations or policies may materially adversely affect the utility of TREP Tokens.

 

Regulation of tokens and token offerings such as this Offering, cryptocurrencies (such as BTC or ETH), financial intermediaries such as spot cryptocurrency exchanges, and blockchain networks (such as the Ethereum Network on which TREP Tokens are intended to be issued), currently is relatively undeveloped and is likely to rapidly evolve. Such regulation may vary and may conflict among international, federal, state, and local jurisdictions, and the potential applications of existing regulations remain subject to significant uncertainty in many respects. In addition, various legislative and executive bodies in the United States and other countries may in the future adopt new laws, regulations, guidance, or other actions (including applying existing laws and regulations in ways that are adverse), which may severely impact the ability to access marketplaces or exchanges on which to trade TREP Tokens, and the structure, rights, value and transferability of TREP Tokens. In addition, failure by us to comply with any laws, rules, and regulations, some of which may not exist yet or are subject to interpretation and may be subject to change, could result in a variety of adverse consequences, including civil penalties and fines.

 

The Offering of these Tokens has been designed to comply with securities registration exemptions under U.S. federal law, and securities laws will limit the ability to resell these Tokens.

 

The Offering has been structured in a manner designed to qualify for valid exemptions from registration under U.S. federal and state securities laws. Investors agree only to resell TREP Tokens in compliance with applicable securities laws and the restrictions on resale set forth in the Subscription Agreement and this Memorandum. In addition, no ATS or other exchange is currently committed to listing TREP Tokens, and treatment of TREP Tokens as security may limit or prevent their listing on certain exchanges in the future. Although we intend to list TREP Tokens on one or more ATSs or other exchanges, no assurance can be made that our attempts to list TREP Tokens on any ATS or other exchange will be successful. 

 

If TREP Tokens are purchased using cryptocurrencies, our proceeds from this offering may be significantly reduced.

 

We may allow investors to purchase TREP Tokens using BTC, ETH, or other cryptocurrencies. We may need to convert the cryptocurrencies received from investors into U.S. dollars. It is expected that we shall use one or more digital currency exchanges or OTC desks for such conversions. Depending on the total sums of cryptocurrency received, the timing of our conversion of the cryptocurrency received and the liquidity of the applicable cryptocurrency markets, conversion may not be instantaneous. In such an event, we will be subject to risks related to fluctuations in the value of such cryptocurrency and U.S. dollars, as applicable, and may also be subject to fees from exchanges and intermediaries that vary with currency value and transaction volume, among other factors. Such risks and fluctuations could result in significantly lower proceeds to us in this Offering.

 

The slowing or stopping of the development or acceptance of blockchain networks and blockchain assets would have an adverse material effect on the successful development and adoption of TREP Tokens.

 

The utilization and growth of the blockchain industry are subject to a high degree of uncertainty. The factors affecting the continuing utilization and further development of the cryptocurrency industry, as well as blockchain networks, include, without limitation:

 

• Worldwide growth, or a decline, in the adoption and use of BTC or ETH and other blockchain assets as well as the decreasing use of blockchain technology;

 

• Government and quasi-government regulation of BTC or ETH and other blockchain assets and their use, or restrictions on, or regulation of access to and operation of blockchain networks (such as the Ethereum Network) or similar systems, including in jurisdictions outside the United States;

 

• The maintenance and development of the open-source software protocol of the Ethereum Network;

 

• Changes in consumer demographics and public tastes and preferences;

 

• The availability and popularity of other forms or methods of buying and selling goods and services, or trading assets, including new means of using sovereign currencies (such as the U.S. dollar) or existing networks; or

 

• General economic conditions and the regulatory environment relating to cryptocurrencies.

 

The slowing or stopping of the development, general acceptance, adoption, and usage of blockchain networks (such as the Ethereum Network) and blockchain assets may deter or delay the acceptance and adoption of TREP Tokens.

 

Blockchain networks utilize code that is subject to change at any time. These changes may have unintended consequences for TREP Tokens.

 

TREP Tokens are intended to be ERC-3643 tokens built on the Ethereum blockchain (or similar) protocol as modified to meet transfer restriction requirements under applicable U.S. securities law. Changes, such as upgrades to Ethereum's blockchain, may have unintended, adverse effects on all blockchains utilizing the ERC-3643 tokens. Also, the Ethereum Network operates based on an open-source protocol maintained by contributors, and contributors are generally not compensated for maintaining and updating the Ethereum Network protocol. The lack of guaranteed financial incentive for contributors to maintain or develop the Ethereum Network and the lack of guaranteed resources to adequately address emerging issues with the Ethereum Network may reduce incentives to address the issues adequately or in a timely manner.

 

This may adversely affect either the market value or the operational status of TREP Tokens.

 

Only a few SEC-registered ATSs currently exist to trade blockchain-based security tokens; we may be unsuccessful in listing the Token on any ATS or, once listed, maintaining such listing; trading over a blockchain-capable ATS currently offers the only legal way to trade security tokens such as TREP Tokens.

 

Currently, there are only a small number of SEC-registered ATSs which have the technological capabilities to permit the trading of securities tokens, such as the Tokens. Because the Tokens are intended to be issued as ERC-3643 tokens on the Ethereum blockchain, they currently cannot be traded using a conventional securities trading platform such as a national securities exchange (e.g., the New York Stock Exchange). However, because Tokens are securities, they are not permitted to be traded on most spot cryptocurrency exchanges that are capable of handling blockchain assets (e.g., Coinbase) because most spot cryptocurrency exchanges are not registered with the SEC to offer trading securities. If we are unable to list on SEC-registered ATS that is capable of handling blockchain tokens, our Tokens may not legally be permitted to trade on a SEC-registered ATS, however, the TREP Tokens will be listed and quoted on our Website (the “TREP Platform”). We expect that new sale or sale of our securities after a syndication offering has concluded, the TREP Platform will be a venue available for the resale of such securities. However, any such resale of an offered syndication will be subject to federal and state securities laws and the restrictions in the syndication offering documents, and there can be no assurance that an active market for such securities will develop on TREP’s Platform, that the TREP Platform will be available to allow resale of such securities to general public. 

 

Banks and financial institutions may not provide banking services or may cut off services to businesses that provide cryptocurrency-related services or that accept cryptocurrencies as payment.

 

A number of companies that provide services relating to cryptocurrency or blockchain tokens have been unable to find banks or financial institutions that are willing to provide them with bank accounts and other services. Similarly, a number of companies and individuals or businesses associated with cryptocurrencies and blockchain tokens may have had and may continue to have their existing bank accounts closed, or services discontinued financial institutions. Banks and other established financial institutions may refuse to process funds for cryptocurrency or blockchain token transactions, process wire transfers to or from cryptocurrency exchanges, cryptocurrency-related companies or service providers, or maintain accounts for persons or entities transacting in cryptocurrency.

 

 

Risk Related to Cryptocurrencies and Crypto-Backed Real Estate Tokenization

 

The Ethereum blockchain, which will be used for TREP Tokens, is susceptible to mining attacks.

 

The Ethereum blockchain, which will be used for TREP Tokens, is susceptible to mining attacks, including double-spend attacks, majority mining power attacks, “selfish-mining” attacks, race condition attacks, and other new forms of attack that may be created in the future. Any successful attacks present a risk to TREP Tokens and expected proper execution and sequencing of TREP Tokens in general. Mining attacks may also target other blockchain networks with which TREP Tokens interact, which may consequently impact TREP Tokens in a materially and significantly negative way.

 

 

 

PLAN OF DISTRIBUTION

 

The Offering

 

TREP is Offering up to fifty million (50,000,000) TREP Tokens to persons who are “accredited investors” (as defined in Rule 501 under Regulation D promulgated under the Securities Act) in reliance upon Regulation D under the Securities Act, or in transactions outside the United States to persons who are not “U.S. Persons” (as defined in Regulation S under the Securities Act) pursuant to Regulation S under the Securities Act and who meet the other investor suitability standards established by TREP.

 

The Offering Price of TREP Token is $1.00, and the Maximum Offering Amount is $50,000,000. Investors who are U.S. Persons must purchase a minimum of fifty thousand (50,000) Tokens to participate in this Offering unless TREP, in its sole discretion, determines to accept a lesser amount. Investors who are not U.S. persons (as defined under Regulation S) investing under the Regulation S exemption may purchase a minimum of one thousand (1,000) Tokens.

 

The Offering began on March 1, 2022 and last until (i) the date at which the Maximum Offering is subscribed; (ii) the date at which a registered offering pursuant to Regulation A+ is qualified by the SEC, or (iii) the Company decides to terminate or extend this offering at any time in its sole discretion in accordance with applicable SEC regulations.

 

The Interests will be issued in the form of cryptographic digital tokens, TREP Tokens, which are a new series of Ethereum blockchain-based smart contract digital tokens meeting the ERC-3643 standard modified to meet transfer restriction requirements under applicable U.S. securities law.

 

Best Efforts Offering

 

TREP may engage a broker-dealer or a placement agent for the Offering. As a “best-efforts” offering, TREP cannot assure prospective Investors that TREP will sell any of the TREP Tokens. Investors have no right to obtain a return of their subscriptions unless TREP sells any of TREP Tokens. Investors have no right to obtain a return of their subscriptions unless TREP does not accept the subscription or closing does not occur. TREP is not required to raise any minimum amount in this Offering before it may utilize the funds received in this Offering as described elsewhere in this Memorandum.

 

Rule 506(c) of Regulation D; Regulation S

 

TREP is distributing this Memorandum and Offering TREP Tokens in the U.S. pursuant to Rule 506(c) of Regulation D under the Securities Act. Accordingly, TREP may employ general solicitation and advertising in connection with the sale of TREP Tokens.

 

All U.S. Investors who participate in the Offering must be accredited investors, and we will take reasonable steps to verify that each Investor is accredited. Each Investor must provide any and all additional documentation that we may reasonably request to confirm that the Investor meets any applicable minimum financial suitability standards. Investors will be asked or required to provide documentation to verify their accredited investor status. This documentation may be retained and reviewed by us, and copies of it may be provided to our affiliates or the broker-dealer or its affiliates. TREP may not accept an Investor’s subscription if the Investor cannot provide documentation that is acceptable to TREP and the broker-dealer. For Investors in this Offering providing statements of assets to support accreditation via net worth, TREP and/or the broker-dealer may be required to run a credit score to determine a purchaser’s current offsetting liabilities.

 

TREP is also distributing this Memorandum and Offering of Tokens to prospective Investors who are not “U.S. Persons,” as defined in Regulation S, in offshore transactions. Such non-U.S. Persons will be required to represent to TREP in writing that they are excluded from the Regulation S definition of “U.S. person” purchasing in an offshore transaction, not for the account or benefit of a U.S. Person. They must also represent in writing that they are purchasing TREP Tokens for their own account and not for the account of others and not with a view to reselling or distributing TREP Tokens.

 

Affiliates of TREP may participate in the Offering

 

TREP’s affiliates, including its officers, directors, and significant interest owners, may purchase Tokens in this Offering.

 

U.S. Purchaser Eligibility Requirements

 

This Offering is limited in the U.S. solely to “accredited investors” as defined in Regulation D under the Securities Act, meaning only those persons or entities coming within any one or more of the following categories:

For Individuals:

 

(a)       an individual with a net worth, or a joint net worth together with their spouse, in excess of $1,000,000. (In calculating net worth, you may include equity in personal property and real estate (however, you cannot include your primary residence), cash, short-term investments, stock, and securities. Equity in personal property and real estate (excluding your primary residence) should be based on the fair market value of such property minus debt secured by such property.)

 

(b)       an individual that had an individual income in excess of $200,000 in each of the prior two years and reasonably expected an income in excess of $200,000 in the current year. (In calculating net income, you may include earned income and other ordinary income, such as interest, dividends, and royalties.)

 

(c)       an individual that had with his/her spouse joint income in excess of $300,000 in each of the prior two years and reasonably expected joint income in excess of $300,000 in the current year. (In calculating net income, you may include earned income and other ordinary income, such as interest, dividends, and royalties.)

 

For Corporations, Partnerships, and other Entities:

 

(a)       an entity in which all of the equity owners are “accredited investors” because each equity owner meets one of the criteria set forth in Part I and Part II of the Investor Questionnaire for Individuals;

 

(b)       a trust (other than an employee benefit or pension plan) with total assets in excess of $5,000,000 not formed for the specific purpose of acquiring securities in connection with the proposed Investment, whose voting decision with respect to the proposed Investment would be directed by a person who has such knowledge and experience in financial and business matters that they are capable of evaluating the merits and risks of the Investment and of the consideration that would be received in the Investment;

 

(c)       a partnership, a corporation, or a Massachusetts or similar business trust, not formed for the specific purpose of acquiring securities in the Investment, with total assets in excess of $5,000,000;

(d)       an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, not formed for the specific purpose of acquiring securities in the proposed Investment, with total assets in excess of $5,000,000;

 

(e)       a bank as defined in Section 3(a)(2) of the Act, whether acting in its individual or fiduciary capacity;

 

(f)        a savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act, whether acting in its individual or fiduciary capacity;

 

(g)       a broker-dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended;

 

(h)       an insurance company as defined in Section 2(13) of the Act;

 

(i)        an investment company registered under the Investment Company Act of 1940, as amended (the “Investment Company Act”);

 

(j)        a business development company as defined in Section 2(a)(48) of the Investment Company Act;

 

(k)       a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958;

 

(l)        a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, with total assets in excess of $5,000,000;

 

(m)      an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), if the investment decision to vote in favor of an Investment is made by a plan fiduciary, as defined in Section 3(21) of ERISA, which is either a bank, savings and loan association, insurance company, or registered investment adviser;

 

(n)       an employee benefit plan within the meaning of ERISA with assets in excess of $5,000,000;

 

(o)       a self-directed employee benefit plan within the meaning of ERISA with investment decisions made solely by persons that are “accredited investors” as defined in Rule 501(a) of the Act; or

 

(p)       a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.

 

As a U.S. person, you will be required to represent to the TREP in writing that you are an accredited investor under Regulation D, as described above, and will be required to provide certain documentation in support of such representation. In addition to the foregoing requirement, you must also represent in writing that you are acquiring TREP Tokens for your own account and not for the account of others and not with a view to resell or distribute such securities.

 

Non-U.S. Purchaser Eligibility Requirements

 

Each Investor who is a Non-U.S. Person must represent in writing that it has satisfied and is in full observance of the laws of such Investor’s jurisdiction in connection with its desire to purchase TREP Tokens, including;

 

(a)       The legal requirements within the Investor’s jurisdiction for the purchase of TREP Tokens and the subsequent holdings in each series;

 

(b)       The purchase of TREP Tokens and subsequent ownership of TREP Tokens will not violate any applicable securities or other laws in the Investor’s jurisdiction;

 

(c)        Any foreign exchange restriction applicable to such purchase;

 

(d)       Any governmental or other consents that may need to be obtained; and

 

(e)       The income tax and other tax consequences, if any, that may be relevant to the purchase, holding, and sale of the TREP Tokens;

 

The following classes of Investors are specifically excluded from the Regulation S definition “U.S. Person” by Rule 902(k)(2) under the Securities Act:

 

• Any discretionary account or similar account (other than an estate or trust) held for the benefit or account of a Non-U.S. person by a dealer or other personal fiduciary organized, incorporated, or (if an individual) resident in the United States;

 

• Any estate of which any professional fiduciary acting as executor or administrator is a U.S. Person if (a) an executor or administrator of the estate who is not a U.S. Person has sole or shared investment discretion with respect to the assets of the estate; and (b) the estate is governed by foreign law;

 

• Any trust of which any professional fiduciary acting as trustee is a U.S. Person if a trustee who is not a U.S. Person has sole or shared investment discretion with respect to the trust assets, and no beneficiary of the trust (and no settlor if the trust is revocable) is a U.S. Person;

 

• An employee benefit plan established and administered in accordance with the law of a country other than the United States and customary practices and documentation of such country;

 

• An agency or branch of a U.S. Person located outside the United States if (a) the agency or branch operates for valid business reasons; and (b) the agency or branch is engaged in the business of insurance or banking and is subject to substantive insurance or banking regulation, respectively, in the jurisdiction where located; and

 

• The International Monetary Fund, the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the United Nations, and their agencies, affiliates and pension plans, and any other similar international organizations, their agencies, affiliates and pension plans.

 

Other Requirements

 

In addition to submitting documentation to confirm their status as non “U.S. Persons,” all potential purchasers of TREP Tokens will need to complete requisite know-your-customer (KYC) and anti-money laundering (AML) procedures to execute a Subscription Agreement.

 

TREP, or the Issuer, reserves the right to request such information as is necessary to verify the identity of purchasers of TREP Tokens and the source of the payment of subscription monies, or as is necessary to comply with any customer identification programs or such information as may be required in order for the Issuer to discharge its obligations under Wyoming law (including pursuant to the Proceeds of Crime Law (as revised)).

 

In the event of delay or failure by the applicant to produce any information required for verification purposes, an application for or transfer of TREP Tokens and the subscription monies relating thereto may be refused.

 

You should check the Office of Foreign Assets Control (the “OFAC”) website at http://www.treas.gov/ofac before making the following representations:

 

(i)         you represent that the amounts invested by you in this Offering were not and are not directly or indirectly derived from any activities that contravene Federal, state, or international laws and regulations, including anti-money laundering laws and regulations. Federal regulations and Executive Orders administered by the OFAC prohibit, among other things, the engagement in transactions with, and the provision of services to, certain foreign countries, territories, entities, and individuals. The lists of the OFAC-prohibited countries, territories, individuals, and entities can be found on the OFAC website at http://www.treas.gov/ofac. In addition, the programs administered by the OFAC (the “OFAC Programs”) prohibit dealing with individuals3 or entities in certain countries, regardless of whether such individuals or entities appear on any OFAC list;

 

(ii)        you represent and warrant that none of (1) you; (2) any person controlling or controlled by you; or (3) if you are a privately-held entity, any person having a beneficial interest in you; or (4) any person for whom you are acting as agent or nominee in connection with this investment is a country, territory, entity or individual named on an OFAC list or a person or entity prohibited under the OFAC Programs. Please be advised that the Issuer may not accept any subscription amounts from a prospective purchaser if such purchasers cannot make the representation set forth in the preceding sentence. You agree to notify the Issuer promptly should you become aware of any change in the information set forth in any of these representations. You are advised that, by law, the Issuer may be obligated to “freeze the account” of any purchaser, either by prohibiting additional subscriptions from it, declining any redemption requests and/or segregating the assets in the account in compliance with governmental regulations and that the Issuer may also be required to report such action and to disclose such purchaser’s identity to the OFAC;

 

(iii)       you represent and warrant that none of (1) you; (2) any person controlling or controlled by you; or (3) if you are a privately-held entity, any person having a beneficial interest in you; or (4) any person for whom you are acting as agent or nominee in connection with this investment is a senior foreign political figure, or any immediate family member or close associate of a senior foreign political figure, as such terms are defined in the footnotes below; and

 

(iv)       if you are affiliated with a non-U.S. banking institution (a “Foreign Bank”), or if you receive deposits from, make payments on behalf of, or handle other financial transactions related to a Foreign Bank, you represent and warrant to the Issuer that: (1) the Foreign Bank has a fixed address, and not solely an electronic address, in a country in which the Foreign Bank is authorized to conduct banking activities; (2) the Foreign Bank maintains operating records related to its banking activities; (3) the Foreign Bank is subject to inspection by the banking authority that licensed the Foreign Bank to conduct its banking activities; and (4) the Foreign Bank does not provide banking services to any other Foreign Bank that does not have a physical presence in any country, and that is not a regulated affiliate.

 

The Issuer is entitled to rely upon the accuracy of your representations. The Issuer may, but under no circumstances will it be obligated to, require additional evidence that a prospective purchaser meets the standards set forth above at any time prior to its acceptance of a prospective purchaser’s subscription. You are not obligated to supply any information requested by the Issuer, but the Issuer, upon the advice of the broker-dealer, may reject a subscription from you or any person who fails to supply such information.

 

 

An investment in Interests may involve significant risks. Only Investors who can bear the economic risk of the investment for an indefinite period of time and the loss of their entire investment should invest in the Interests. See “Risk Factors.”

 

Fees and Expenses

 

Offering Expenses

 

TREP shall be responsible for certain fees, costs, and expenses incurred in connection with the offering of the interests associated with the Company (the “Offering Expenses”). Offering Expenses consist of legal, accounting, compliance, and marketing costs, as applicable, related to this Offering (and excludes commission paid to the broker-dealer and ongoing cots including Operating Expenses). The Managing Member has agreed to pay and be reimbursed for Offering Expenses with respect to this Offering.

 

Dealer Broker Fees

 

As compensation for providing certain broker-dealer services to TREP with this Offerings, the broker-dealer will receive a cash service fee equal to 5% of the amount raised through this Offering (which, for clarification purposes, excludes any Interests purchased by Managing Member, its affiliates, or the Asset Sellers), the Expense Reimbursement of all its reasonable out-of-pocket expenses (including attorney’s fees).

 

Additional Information Regarding this Memorandum

 

We have not authorized anyone to provide you with information other than as set forth in this Memorandum. Except as otherwise indicated, all information contained in this Memorandum is given as of the date of this Memorandum. Neither the delivery of this Memorandum nor any sale made hereunder shall under any circumstances create any implication that there has been no change in our affairs since the date hereof.

 

How to Subscribe

 

Potential Investors who are “accredited investors” or excluded from the Regulation S definition of “U.S. persons” may subscribe to purchase the TREP Tokens. Any potential Investor wishing to acquire the TREP Tokens must:

 

1. Carefully read this Memorandum, as well as any documents described in the Memorandum and attached hereto or which you have requested. Consult with your tax, legal and financial advisors to determine whether an investment in the Interests is suitable for you.

 

2. Review the subscription agreement (including the “Investor Questionnaire” attached thereto), fill-out and sign the completed subscription agreement along with the related TREP, LLC operating agreement member signature page using an electronic signature. Additionally, you will need to provide entity information such as address and social security number or tax ID number to pass KYC (Know Your Customer) and AML (Anti Money Laundering) checks. Except as otherwise required by law, subscriptions may not be withdrawn or canceled by subscribers.

 

3. If you are an Investors who is not a U.S. person and you will be purchasing TREP Tokens pursuant to the securities registration exemption provided by Regulation S, you will be asked to make payment for your purchases of TREP Tokens prior to the completion of the AML/KYS investor review process. For Investors who are U.S. persons and who will be purchasing TREP Tokens pursuant to the securities registration exemption provided by Regulation D, once the completed subscription agreement is signed and accreditation and KYC/AML steps are complete, you must follow the payment instructions provided with the subscription agreement to make payment to finalize your purchase of the TREP Tokens.

 

4. Once the review is complete, the Manager will inform you whether or not your application to subscribe for the TREP Tokens is approved or denied and, if approved, the number of TREP Tokens you are entitled to subscribe for. If your subscription is accepted, your subscription payment will then become available to the Company for use. If your subscription is rejected in whole or in part, then your subscription payments (being the entire amount if your application is rejected in whole or the payments associated with those subscriptions rejected in part), if any, will be refunded promptly without interest or deduction. The Manager accepts subscriptions on a first-come, first-served basis subject to the right to reject or reduce subscriptions.

 

5. If all or a part of your subscription is approved, then the number of TREP Tokens you are entitled to subscribe for will be issued to your electronic digital wallet.

 

By executing the subscription agreement and the TREP LLC operating agreement member signature page, you agree to be bound by the terms of the subscription agreement and Operating Agreement. TREP, the Managing Member, and the broker-dealer will rely on the information you provide in the subscription agreement, including the “Investor Questionnaire” attached thereto and the supplemental information you provide in order for the Managing Member and the broker-dealer to verify your status as an “accredited investor.” If any information about your “accredited investor” status changes prior to you being issued the TREP Tokens, please notify the Managing Member immediately using the contact details set out in the subscription agreement.

 

USE OF PROCEEDS

 

The tables included below set forth the estimated use of proceeds for this Offering, assuming the Offering raises the Maximum Offering Amount.

 

Uses	Percentage of Gross Cash Proceeds
Purchase of Tax Lien Certificates (TLC) or Tax Deeds or TLC Managed Funds	75%
Offering Expenses	5%
Working capital	20%

 

The allocation of the gross cash proceeds of this Offering set forth above represents our intentions based upon our current plans and assumptions regarding the industry and general economic conditions, our future revenues if any, and expenditures. The amounts and timing of our actual expenditures will depend upon numerous factors, including market conditions, cash generated by our operations, business development, and related rate of growth. The Managing Member reserves the right to modify the use of proceeds based on the factors set forth above.

 

 

 

 

DESCRIPTION OF BUSINESS

 

TREP, LLC was formed in February 2022 as a Wyoming limited liability company to offer a unique investment opportunity for eligible investors to benefit from the performance of curated and fully managed rental real estate properties and other investments, including but not limited to mortgage loans, tax lien certificates, TLC managed funds, government securities, cryptocurrencies, and asset-backed tokens. From time to time, the Company will form separate LLCs in the U.S. and offshore syndications to hold investment properties. Each LLC will be treated as a partnership for U.S. federal income tax purposes, and each syndication will be treated as special purpose vehicle in the country that it is located.    

Since each LLC or LLP is separately registered in the state in which the property is located, and each syndication registered in the country in which the property is located, the debts, liabilities, obligations, and expenses incurred, contracted for, or otherwise existing with respect to a particular LLC or syndication are segregated and enforceable only against the asset of such LLC or syndication, under the applicable law.

The Company is offering 50,000,000 membership interest in TREP, LLC for an aggregate total of $50,000,000 distributed in TREP Tokens. The Company its future LLCs and syndications, will hold residential, commercial, and mix-used rental property and other investments set forth above as its primary asset.

The Company is considering undertaking an additional security offering under the exemption from registration of security provided by Regulation A of the Securities Act of 1933, as amended. This exemption would allow the Company to raise up to $75 million from investors against free-trading shares / tokens upon qualification of the Offering by the SEC. As of the date of this Memorandum, we have not filed with the SEC for such an offering.

Investment Objectives

Our primary investment objectives are:

 

• Consistent cash flow;

 

• Long term capital appreciation with moderate leverage;

 

• Favorable tax treatment of real estate income and long term capital gains; and

 

• Capital preservation

 

Investment Strategy

 

Our investment strategy is to acquire, invest in, manage, operate properties on an opportunistic basis, which may consist of a wide variety of residential and commercial rental properties, including single-family, multi-family, office, industrial, hospitality, recreation, and leisure, and other real properties. We intend to leverage our industry experience and our propriety technology to help streamline our property acquisition process.

 

In addition, we will invest in tax lien certificates, tax lien management funds, government securities, and asset-backed securities to generate a regular stream of cash flow for our investors. We will focus on investing in instruments such as tax liens and tax deeds because of the relatively low capital requirements, the potential returns, and the ability to be involved in real estate without much of the responsibility of owning and/or managing the actual property.

 

Investment Process

 

The Manager will focus on sourcing, acquiring, and managing residential, commercial, and mix-used properties. Furthermore, the Manager may also invest in tax lien certificates, tax lien managed funds, government securities, and asset-backed securities to generate a regular cash flow for our investors.

 

All property acquisitions, whether they are TREP portfolio properties or a syndication, must go through a stringent qualification process consisting of numerous metrics including but not limited to:

 

1. Quality and value of location


2. Tenant history


3. Strength of current lease agreements


4. Evaluation of past delinquencies and evictions


5. Rental yield of property


6. Potential for rent increases


7. Potential market value appreciation


8. Deferred maintenance


9. Micro and macro industry factors including local employment statistics


10. Quality of clear title

 

Once a property passes these tests, it may qualify to become syndicated or purchased directly by TREP.

 

Tokens Being Offered

 

Investors will acquire membership in the Company through cryptographic digital tokens meeting the ERC-3643 standard (the “Token”). It is intended that the owners of Token in the Company will have assets, liabilities, profits, and losses pertaining to investments made by the Company. See the “Description of Securities Offered” section for further details. The minimum investment that a U.S. person can make is a minimum of fifty thousand (50,000) Tokens at an aggregate purchase price of $50,000.00 to participate in this Offering, although TREP, in its sole discretion, may determine to accept a lesser amount. Investors who are not included in the Regulation S definition of “U.S. persons” investing under the Regulation S exemption may purchase a minimum of one thousand (1,000) Tokens at an aggregated purchase price of $1,000.00 to participate in this Offering.

 

The Manager

 

Our company is managed by a Board of Managers, which we refer to herein as the “manager.” Pursuant to the terms of our company’s limited liability company operating agreement, which we refer to as the “operating agreement,” the manager will provide certain management and advisory services to our company, as well as a management team and appropriate support personnel.

 

Operating Expenses

Upon the initial Closing, the syndication will be responsible for the following Operating Expenses;

• any and all ongoing fees, costs, and expenses incurred in connection with the management of the Underlying Asset, including income taxes, security, valuation, maintenance and repairs, marketing and utilization of the Underlying Asset;

 

• fees, costs, and expenses incurred in connection with preparing any reports and accounts of the Series, including any blue-sky filings required in certain states and an annual audit of the accounts of the syndication (if applicable);

 

• fees, costs, and expenses of a third-party registrar and transfer agent appointed in connection with the Series;

 

• fees, costs, and expenses incurred in connection with making any tax filings on behalf of the Series;

 

• any indemnification payments;

 

• any and all insurance premiums or expenses incurred in connection with the Underlying Asset; and

 

• any similar expenses that may be determined to be Operating Expenses, as determined by the Managing Member in its reasonable discretion.

 

Limits to Liability; Indemnification of the Managing Member

 

The Operating Agreement provides that none of the Managing Member, nor any current or former directors, officers, employees, partners, shareholders, members, controlling persons, agents or independent contractors of the Managing Member, nor persons acting at the request of TREP in certain capacities with respect to other entities (collectively, the “Indemnified Parties”) will be liable to TREP, any interest holders of syndication for any act or omission taken by the Indemnified Parties in connection with the business of TREP or any syndication that has not been determined in a final, no appealable decision of a court, arbitrator or other tribunals of competent jurisdiction to constitute fraud, willful misconduct or gross negligence.

 

Each syndication will indemnify the Indemnified Parties out of its assets against all liabilities and losses (including amounts paid in respect of judgments, fines, penalties or settlement of litigation, including legal fees and expenses) to which they become subject by virtue of services performed with respect to TREP or such syndication and with respect to any act or omission that has not been determined by a final, non-appealable decision of a court, arbitrator or other tribunals of competent jurisdiction to constitute fraud, willful misconduct or gross negligence.

 

Employees

TREP has five (5) full-time employees and intends to rapidly expand to 10-15 employees by the fourth quarter this year.

 

 

 

DIRECTORS, EXECUTIVE OFFICERS, AND SIGNIFICANT EMPLOYEES

 

The Managing Member

 

TREP operates under the direction of the Managing Member, which is responsible for directing the operations of our business, directing our day-to-day affairs, and implementing our investment strategy. The Managing Member has established a Board of Directors that will make decisions with respect to all asset acquisitions, dispositions, and maintenance schedules. The Managing Member and its officers and directors are not required to devote all of their time to our business and are only required to devote such time to our affairs as their duties require. The Managing Member is responsible for determining maintenance required in order to maintain or improve the asset’s quality, determining how to monetize the underlying assets in order to generate profits, and evaluating potential sale offers, which may lead to the liquidation of the underlying asset or other syndication as the case may be.

 

TREP will follow guidelines adopted by the Managing Member and implement policies set forth in the Operating Agreement unless otherwise modified by the Managing Member. The Managing Member may establish further written policies and will monitor our administrative procedures, investment operations, and performance to ensure that the policies are fulfilled. The Managing Member may change our objectives at any time without the approval of our interest holders. The Managing Member itself has no track record and is relying on the track record of its individual officers, directors, and advisors.

 

The Managing Member performs its duties and responsibilities pursuant to the Operating Agreement. The Managing Member maintains a contractual, as opposed to a fiduciary relationship, with our interest holders and us. Furthermore, we have agreed to limit the liability of the Managing Member and to indemnify the Managing Member against certain liabilities.

 

Directors, Executive Officers and Key Employees

 

The following table sets forth the name and position of each of the current executive officers, directors and significant employees of the Managing Member.

 

Name	Position	Age
Jay Patel	Chief Executive Officer	50
Michael Mazek	Real Estate Counsel	43
Syed Rizvi	SEC General Counsel	38
Neelkanth Aher	International Operations	46

 

Jay Patel – CEO, Managing Member: The TREP team is led by Mr. Jay Patel, a seasoned veteran of the real estate industry with 22+ years of experience in various facets of the industry including multiple land development projects, rehab flips, structured syndications, and brokerage where he holds a Managing Broker license and has been recognized as a top producer.  Currently Patel hangs his license with the fastest growing real estate company in the market - EXP Realty.  Beyond traditional real estate, Patel also has a vast level of experience on the real estate technology front having designed and managed a national residential & commercial MLS system for India since 2015. 

Michael Mazek – Real Estate Transactional Counsel (US): Michael Mazek is an experienced real estate attorney, well versed in all areas of real estate law including closings, short sales, foreclosures, tax appeals, real estate litigation (adverse possession, lot line disputes, condo association conflict), estate planning (wills, trusts and other estate planning instruments), probate matters, and much more.  In 2009, Mazek launched his private boutique firm, Mazek Law Group, to provide high quality legal representation in northern Chicagoland.  Michael has worked with Jay Patel on numerous real estate transactions during the past decade, and now joins Patel in TREP where Michael will apply his vast real estate experience in overseeing all TREP property transactions.  Michael completed his undergraduate degree at the University of Illinois – Chicago and also received his JD from the University of Illinois – Chicago School of Law in 2004.

Syed Rizvi – Securities Counsel:  Syed is a recognized leader in the area of corporate law with an emphasis on US securities law.  Rizvi spent more than eleven years with the most-respected law firms in New York before forming CounselBridge.  He is also a mentor and entrepreneur and serves as both general and special counsel to various companies, advising them on matters including but not limited to corporate finance, information technology, data privacy, as well as regulatory and compliance.  Syed holds a Master of Laws from Fordham University in New York and a Bachelor of Laws from the University of London, United Kingdom.

 

 

 

COMPENSATION OF MANAGING MEMBERS AND AFFILIATES

 

Compensation of Executive Officers

 

The salary and other compensation, including any bonuses and benefits, of the executive officers and the Managing Members of the Company shall be as approved from time to time by the Board of Managers.

 

SECURITIES BEING OFFERED

 

TREP Tokens

 

In this Offering, Interests will be issued in the form of TREP Tokens in the form of electronic, digital tokens, which are effectively digital limited liability company membership interests. TREP Tokens will be issued as Ethereum-based smart contracts on the Ethereum Blockchain. TREP Tokens will be a new series of Ethereum-based smart contract digital tokens meeting the ERC-3643 protocol standard as modified to meet transfer restriction requirements under applicable U.S. securities law. Although we are currently proposing TREP Tokens will use Ethereum Blockchain, we reserve the right our sole discretion to issue TREP Tokens on another blockchain network under a different, non-ERC smart contract token protocol.

 

As TREP Tokens are digital representation of our Interests. The right of holders of our TREP Tokens come from our Operating Agreement, which sets out the terms of Interests, whether held in token form or not and the ERC-3643 smart contract, as modified to meet transfer restriction requirements under applicable U.S. securities law, which establishes the terms upon which TREP Tokens holder will hold such tokens. There is no substantive difference between the rights of Interests held in TREP Tokens and the rights of Interest held directly. Other than specifying the manner of holding and transfer TREP Tokens, the smart contract does not confer any rights or restrictions on the holders of TREP Tokens that differ from those of investors not holding Interests in token form.

 

TREP Tokens will be delivered to Digital Wallet addresses on the Ethereum Blockchain and governed by the TREP smart contracts. We do not control the Ethereum Blockchain or the Investors’ Digital Wallets.

 

Because the TREP Tokens represent our Interests, there is no limitation embedded in the TREP smart contracts on the number of tokens that can be created. The overall potential number of TREP Tokens will be a function of corporate law and will be increased or fractionalized in accordance with laws of the State of Wyoming and our Operating Agreement.

 

Securities Law Restrictions

 

TREP Tokens have not been registered under the Securities Act or any securities laws of any state or any jurisdiction anywhere in the world, and, unless so registered, TREP Tokens may not be offered or sold except pursuant to an exemption from or in a transaction not subject to, the registration requirements of the Securities Act and such other applicable securities laws. As a result, TREP Tokens are being offered and sold only in jurisdictions where such registration or qualification is not required, including pursuant to applicable exemptions that generally limit the investors who are eligible to purchase TREP Tokens and that restrict the resale of such tokens. Accordingly, TREP Tokens are being initially offered and sold only (1) to “accredited investors” (as defined under Regulation D) in compliance with Regulation D, in each case, in a private transaction in reliance on the exemption from the registration requirements of the Securities Act provided by Regulation D under the Securities Act, and (2) outside the United States to investors who are not “U.S. persons” in offshore transactions in reliance upon Regulation S under the Securities Act.

 

Access to Alternative Trading System (“ATS”)

 

Upon qualification of TREP’s registered offering (Regulation A+), TREP plans to raise capital and list TREP Tokens on participating SEC-regulated exchanges or ATS’ in the future. This initiative is planned by the Company to provide additional liquidity for TREP Tokens / Units. 

 

Digital Notices

 

TREP tokens are digital instruments and, as such, will not contain legends. However, purchasers (including secondary purchasers) of TREP Tokens will be presented with the information regarding restrictions on the transfer of the TREP Tokens, including legends set forth below, and, at a minimum, must affirmatively signal their understanding of the information and provide TREP with certain representations on their investor status and location. Each token will incorporate legends substantially to the following effect:

 

THIS SECURITY, I.E., THE TOKEN (THE “TOKENS”), HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION THEREIN, MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED OF UNDER ANY CIRCUMSTANCES. EACH HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS THAT (A) IT IS AN “ACCREDITED INVESTOR” (AS DEFINED IN REGULATION D UNDER THE SECURITIES ACT) OR (B) IT IS NOT A “U.S. PERSON” AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH THE LAWS APPLICABLE TO IT IN THE JURISDICTION IN WHICH SUCH ACQUISITION IS MADE.

 

TREP TOKENS, WHEN ISSUED, WILL BE ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT AND MAY NOT BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT (“REGULATION S”)) EXCEPT PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS. EXCEPT AS SET FORTH BELOW, TREP TOKENS SHALL NOT BE EXCHANGEABLE FOR TOKENS THAT ARE NOT SUBJECT TO A LEGEND CONTAINING RESTRICTIONS ON TRANSFER UNTIL THE EXPIRATION OF THE APPLICABLE ONE-YEAR “DISTRIBUTION COMPLIANCE PERIOD” (WITHIN THE MEANING OF REGULATION S) AND THEN ONLY UPON CERTIFICATION IN A FORM REASONABLY SATISFACTORY TO ISSUER AND ITS TRANSFER AGENT, IF ANY, THAT SUCH TOKENS ARE OWNED EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. THE HOLDER OF ANY TOKENS AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH TOKENS PRIOR TO THE EXPIRATION OF THE APPLICABLE ONE-YEAR HOLDING PERIOD WITH RESPECT TO RESTRICTED SECURITIES SET FORTH IN RULE 144 UNDER THE SECURITIES ACT (THE “RESALE RESTRICTION TERMINATION DATE”), ONLY (A) TO ISSUER OR ANY OF ISSUER’S AFFILIATES, (B) PURSUANT TO A COMPLIANT REGULATION S SALE, OR (C) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, SUBJECT, IN EACH OF THE FOREGOING CASES, TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH PURCHASER ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND, IN EACH CASE, IN COMPLIANCE WITH APPLICABLE SECURITIES LAWS OF ANY APPLICABLE JURISDICTION. HEDGING TRANSACTIONS INVOLVING TREP TOKENS MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

 

WHERE YOU CAN FIND ADDITIONAL INFORMATION

 

The statements contained in this Memorandum constitute only a brief summary of certain provisions of the documents referred to and the transactions contemplated. The statements contained in this document do not purport to be a complete description of every term and condition of such documents and are qualified in their entirety by reference to such documents. As with any summary, some details and exceptions have been omitted. If any of the statements made in this Memorandum are in conflict with any of the terms of any of such documents, the terms of such documents will govern. Reference is made to the actual documents for a complete understanding of what they contain. Copies of all documents in connection with the transaction described in this Memorandum are available from TREP at the address listed below. Each prospective Investor and their advisor are invited and encouraged to ask us questions with respect to the terms and conditions of the Offering, the structure and function of the TREP Tokens, and our business and request additional information necessary to verify information in this Memorandum. We will seek to provide answers, and such information to the extent possessed or obtainable without unreasonable effort or expense. Potential Investors may be required to execute non-disclosure agreements as a prerequisite to reviewing documents determined by us to contain proprietary, confidential, or otherwise sensitive information. To obtain such information or to make arrangements to ask such questions of us, prospective Investors should contact us through the following address:

 

 

TREP, LLC

1309 Coffeen Avenue, STE 1200, Sheridan, Wyoming 82801

Telephone: +1.224.328.5300

investor.relations@trep.co

Attention: Jay Patel

 

 

 

APPENDIX A – JURISDICTIONAL NOTES

 

NOTICE TO RESIDENTS OF THE UNITED STATES AND “U.S. PERSONS”

 

THE OFFER AND SALE OF THE TREP TOKENS CURRENTLY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE THEREOF. THE TREP TOKENS MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED, OR HYPOTHECATED WITHIN THE UNITED STATES OR TO A “U.S. PERSON” (AS DEFINED IN REGULATION S PROMULGATED UNDER THE SECURITIES ACT), EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION THEREFROM.

 

NASAA UNIFORM LEGEND

 

IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. TREP TOKENS HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND THE APPLICABLE STATE SECURITIES LAWS PURSUANT TO REGISTRATION OR EXEMPTION. PROSPECTIVE INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

 

NOTICE TO RESIDENTS OF AUSTRALIA

 

THE TREP TOKENS ARE NOT “SECURITIES” FOR THE PURPOSES OF CHAPTER 6D OF THE CORPORATIONS ACT 2001 (CTH) (OR THE CORPORATIONS ACT). NO PROSPECTUS, PRODUCT DISCLOSURE STATEMENT, OR OTHER DISCLOSURE DOCUMENT HAS BEEN LODGED WITH THE AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION (ASIC) IN RELATION TO THIS OFFERING OF TREP TOKENS. ANY OFFER IN AUSTRALIA OF THE TREP TOKENS MAY ONLY BE MADE TO “WHOLESALE CLIENTS” (WITHIN THE MEANING OF SECTIONS 761G AND 761GA OF THE CORPORATIONS ACT) AND ANY PERSONS IN AUSTRALIA WHO APPLY TO BE ALLOTTED TREP TOKENS UNDER THIS OFFERING WARRANT TO THE ISSUER OF THE TREP TOKENS THAT THEY ARE A “WHOLESALE CLIENT” (WITHIN THE MEANING OF SECTIONS 761G AND 761GA OF THE CORPORATIONS ACT). THE TREP TOKENS MUST NOT BE OFFERED FOR SALE IN AUSTRALIA IN THE PERIOD OF 12 MONTHS AFTER THE DATE OF ALLOTMENT OF THE TREP TOKENS UNDER THIS OFFERING TO ANY “RETAIL CLIENT” (WITHIN THE MEANING OF SECTIONS 761G AND 761GA OF THE CORPORATIONS ACT). ANY INVESTOR ACQUIRING THE TREP TOKENS MUST OBSERVE SUCH AUSTRALIAN ON-SALE RESTRICTIONS.

 

NOTICE TO RESIDENTS OF BRAZIL

 

THE TREP TOKENS HAVE NOT BEEN AND WILL NOT BE ISSUED NOR PUBLICLY PLACED, DISTRIBUTED, OFFERED, OR NEGOTIATED IN THE BRAZILIAN CAPITAL MARKETS. THE ISSUANCE OF THE TREP TOKENS HAS NOT BEEN NOR WILL BE REGISTERED WITH THE BRAZILIAN SECURITIES AND EXCHANGE COMMISSION (“CVM”). ANY PUBLIC OFFERING OR DISTRIBUTION, AS DEFINED UNDER BRAZILIAN LAWS AND REGULATIONS, OF THE TREP TOKENS IN BRAZIL IS NOT LEGAL WITHOUT PRIOR REGISTRATION UNDER BRAZILIAN LAWS AND CVM REGULATIONS. DOCUMENTS RELATING TO THE OFFERING OF THE TREP TOKENS, AS WELL AS INFORMATION CONTAINED THEREIN, MAY NOT BE SUPPLIED TO THE PUBLIC IN BRAZIL (AS THE OFFERING OF THE TREP TOKENS IS NOT A PUBLIC OFFERING OF SECURITIES IN BRAZIL), NOR BE USED IN CONNECTION WITH ANY OFFER FOR PURCHASE OR SALE OF THE TREP TOKENS TO THE PUBLIC IN BRAZIL. THEREFORE, THE COMPANY HAS NOT OFFERED OR SOLD, AND WILL NOT OFFER OR SELL, THE TREP TOKENS IN BRAZIL, EXCEPT IN CIRCUMSTANCES THAT DO NOT CONSTITUTE A PUBLIC OFFERING, PLACEMENT, DISTRIBUTION, OR NEGOTIATION, OR AN UNAUTHORIZED DISTRIBUTION OF SECURITIES IN THE BRAZILIAN CAPITAL MARKETS REGULATED BY BRAZILIAN LEGISLATION. PERSONS WISHING TO OFFER OR ACQUIRE THE TREP TOKENS WITHIN BRAZIL SHOULD CONSULT WITH THEIR OWN COUNSEL AS TO THE APPLICABILITY OF REGISTRATION REQUIREMENTS OR AN EXEMPTION THEREFROM.

 

NOTICE TO RESIDENTS OF THE EUROPEAN ECONOMIC AREA

 

WITH RESPECT TO PUBLIC OFFER SELLING RESTRICTIONS UNDER THE PROSPECTUS DIRECTIVE IN RELATION TO EACH MEMBER STATE OF THE EUROPEAN ECONOMIC AREA WHICH HAS IMPLEMENTED THE PROSPECTUS DIRECTIVE (EACH A “RELEVANT MEMBER STATE”), WITH EFFECT FROM AND INCLUDING THE DATE ON WHICH THE PROSPECTUS DIRECTIVE IS IMPLEMENTED IN THAT RELEVANT MEMBER STATE (THE “RELEVANT IMPLEMENTATION DATE“), THE COMPANY HAS NOT MADE AND WILL NOT MAKE AN OFFER OF TREP TOKENS WHICH ARE THE SUBJECT OF THE OFFERING CONTEMPLATED BY THIS MEMORANDUM TO THE PUBLIC IN THAT RELEVANT MEMBER STATE, EXCEPT THAT IT MAY, WITH EFFECT FROM AND INCLUDING THE RELEVANT IMPLEMENTATION DATE, MAKE AN OFFER OF SUCH TREP TOKENS TO THE PUBLIC IN THAT RELEVANT MEMBER STATE:

 

(A)       QUALIFIED INVESTORS: TO ANY LEGAL ENTITY WHICH IS A QUALIFIED INVESTOR AS DEFINED IN THE PROSPECTUS DIRECTIVE;

 

(B)       FEWER THAN 100 OFFEREES: TO FEWER THAN 100 OR, IF THE RELEVANT MEMBER STATE HAS IMPLEMENTED THE RELEVANT PROVISION OF THE 2010 PD AMENDING DIRECTIVE, 150 NATURAL

OR LEGAL PERSONS (OTHER THAN QUALIFIED INVESTORS AS DEFINED IN THE PROSPECTUS DIRECTIVE), AS PERMITTED UNDER THE PROSPECTUS DIRECTIVE; OR

 

(C)       OTHER EXEMPT OFFERS: IN ANY OTHER CIRCUMSTANCES FALLING WITHIN ARTICLE 3(2) OF THE PROSPECTUS DIRECTIVE; PROVIDED THAT NO SUCH OFFER OF NOTES SHALL REQUIRE THE ISSUER OR THE MANAGER TO PUBLISH A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE OR SUPPLEMENT A PROSPECTUS PURSUANT TO ARTICLE 16 OF THE PROSPECTUS DIRECTIVE.

 

FOR THE PURPOSES OF THIS PROVISION, THE EXPRESSION, AN “OFFER OF TREP TOKENS TO THE PUBLIC” IN RELATION TO ANY TREP TOKENS IN ANY RELEVANT MEMBER STATE, MEANS THE COMMUNICATION IN ANY FORM AND BY ANY MEANS OF SUFFICIENT INFORMATION ON THE TERMS OF THE OFFER AND THE TREP TOKENS TO BE OFFERED SO AS TO ENABLE AN INVESTOR TO DECIDE TO PURCHASE OR SUBSCRIBE THE TREP TOKENS, AS THE SAME MAY BE VARIED IN THAT MEMBER STATE BY ANY MEASURE IMPLEMENTING THE PROSPECTUS DIRECTIVE IN THAT MEMBER STATE, THE EXPRESSION “PROSPECTUS DIRECTIVE” MEANS DIRECTIVE 2003/71/EC (AND AMENDMENTS THERETO, INCLUDING THE

2010 PD AMENDING DIRECTIVE, TO THE EXTENT IMPLEMENTED IN THE RELEVANT MEMBER STATE,), AND INCLUDES ANY RELEVANT IMPLEMENTING MEASURE IN THE RELEVANT MEMBER STATE AND THE EXPRESSION “2010 PD AMENDING DIRECTIVE” MEANS DIRECTIVE 2010/73/EU.

 

NOTICE TO RESIDENTS OF BRITISH VIRGIN ISLANDS

 

THE TREP TOKENS AND ANY DOCUMENTS USED IN CONNECTION THEREWITH DO NOT CONSTITUTE A PUBLIC OFFER OF THE SECURITIES, WHETHER BY WAY OF SALE OR SUBSCRIPTION, IN THE BRITISH VIRGIN ISLANDS. THE COMPANY WILL NOT CARRY ON BUSINESS IN THE BRITISH VIRGIN ISLANDS. THE TREP TOKENS HAVE NOT BEEN OFFERED OR SOLD, AND WILL NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE BRITISH VIRGIN ISLANDS, EXCEPT AS MAY BE PERMITTED BY LAW WITHOUT CREATING AN OBLIGATION FOR THE COMPANY TO REGISTER IN THE BRITISH VIRGIN ISLANDS.

 

NOTICE TO RESIDENTS OF CANADA

 

THIS MEMORANDUM CONSTITUTES AN OFFERING OF THE TREP TOKENS IN ALL OF THE PROVINCES OF CANADA (THE “CANADIAN JURISDICTIONS”). NO SECURITIES COMMISSION OR SIMILAR AUTHORITY IN CANADA HAS REVIEWED OR IN ANY WAY PASSED UPON THIS MEMORANDUM OR THE MERITS OF THE TREP TOKENS, AND ANY REPRESENTATION TO THE CONTRARY IS AN OFFENCE.

 

THE DISTRIBUTION OF TREP TOKENS IN THE CANADIAN JURISDICTIONS IS BEING MADE ONLY ON A PRIVATE PLACEMENT BASIS AND IS EXEMPT FROM THE REQUIREMENT THAT THE COMPANY PREPARE AND FILE A PROSPECTUS WITH THE RELEVANT CANADIAN SECURITIES REGULATORY AUTHORITIES. ACCORDINGLY, ANY RESALE OF THE TREP TOKENS MUST BE MADE IN ACCORDANCE WITH APPLICABLE CANADIAN SECURITIES LAWS, WHICH WILL VARY DEPENDING ON THE RELEVANT JURISDICTION AND WHICH MAY REQUIRE RESALES TO BE MADE IN ACCORDANCE WITH PROSPECTUS AND DEALER REGISTRATION REQUIREMENTS OR EXEMPTIONS FROM THE PROSPECTUS AND DEALER REGISTRATION REQUIREMENTS. THESE RESALE RESTRICTIONS MAY, UNDER CERTAIN CIRCUMSTANCES, APPLY TO RESALES OF TREP TOKENS OUTSIDE OF CANADA. CANADIAN INVESTORS ARE ADVISED TO SEEK LEGAL ADVICE PRIOR TO ANY RESALE OF TREP TOKENS, BOTH WITHIN AND OUTSIDE OF CANADA.

 

THE COMPANY IS NOT PRESENTLY AND DOES NOT INTEND TO BECOME, A “REPORTING ISSUER,” AS SUCH TERM IS DEFINED UNDER APPLICABLE CANADIAN SECURITIES LAWS IN ANY PROVINCE OR TERRITORY OF CANADA. CANADIAN INVESTORS ARE ADVISED THAT THE TREP TOKENS ARE NOT AND WILL NOT BE LISTED ON ANY STOCK EXCHANGE IN CANADA AND THAT NO PUBLIC MARKET PRESENTLY EXISTS OR IS EXPECTED TO EXIST FOR THE TREP TOKENS IN CANADA FOLLOWING THIS OFFERING.

 

CANADIAN INVESTORS ARE FURTHER ADVISED THAT THE COMPANY IS NOT REQUIRED TO FILE AND CURRENTLY DOES NOT INTEND TO FILE A PROSPECTUS OR SIMILAR DOCUMENT WITH ANY SECURITIES REGULATORY AUTHORITY IN CANADA QUALIFYING THE RESALE OF THE TREP TOKENS TO THE PUBLIC IN ANY PROVINCE OR TERRITORY OF CANADA IN CONNECTION WITH THIS OFFERING. ACCORDINGLY, THE TREP TOKENS MAY BE SUBJECT TO AN INDEFINITE HOLD PERIOD UNDER APPLICABLE CANADIAN SECURITIES LAWS UNLESS RESALES ARE MADE IN ACCORDANCE WITH APPLICABLE PROSPECTUS REQUIREMENTS OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH PROSPECTUS REQUIREMENTS.

 

REPRESENTATIONS OF CANADIAN INVESTORS

 

EACH CANADIAN INVESTOR WHO PURCHASES TREP TOKENS WILL BE DEEMED TO HAVE REPRESENTED THAT: (I) SUCH INVESTOR IS RESIDENT IN A DESIGNATED CANADIAN JURISDICTION; (II) TO THE KNOWLEDGE OF SUCH INVESTOR, THE OFFER AND SALE OF TREP TOKENS WERE NOT ACCOMPANIED BY ANY ADVERTISEMENT OF THE TREP TOKENS IN ANY PRINTED MEDIA OF GENERAL AND REGULAR PAID CIRCULATION, RADIO, TELEVISION OR TELECOMMUNICATIONS, INCLUDING ELECTRONIC DISPLAY, OR ANY OTHER FORM OF ADVERTISING IN CANADA; (III) WHERE REQUIRED BY LAW, SUCH INVESTOR IS PURCHASING TREP TOKENS AS PRINCIPAL, OR IS DEEMED TO BE PURCHASING AS PRINCIPAL IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF THE APPLICABLE CANADIAN JURISDICTION, FOR ITS OWN ACCOUNT AND NOT AS AGENT FOR THE BENEFIT OF ANOTHER PERSON OR IS DEEMED TO BE SO PURCHASING, AND IS PURCHASING FOR INVESTMENT ONLY AND NOT WITH A VIEW TO RESALE OR DISTRIBUTION; (IV) SUCH INVESTOR OR ANY ULTIMATE INVESTOR FOR WHICH SUCH INVESTOR IS ACTING AS AGENT IS ENTITLED UNDER APPLICABLE SECURITIES LAWS IN THE RELEVANT CANADIAN JURISDICTIONS TO SUBSCRIBE FOR TREP TOKENS WITHOUT THE BENEFIT OF A PROSPECTUS QUALIFIED UNDER SUCH SECURITIES LAWS; AND WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, (A) SUCH INVESTOR IS AN “ACCREDITED INVESTOR” AS DEFINED IN SECTION 1.1 OF NATIONAL INSTRUMENT 45-106 – PROSPECTUS EXEMPTIONS (“NI 45-106”) AND SECTION 73.3 OF THE SECURITIES ACT (ONTARIO), AS APPLICABLE, AND, WHERE THE INVESTOR IS AN INDIVIDUAL “ACCREDITED INVESTOR”, HE OR SHE IS RELYING ON PARAGRAPH (J.1) OF THE DEFINITION OF “ACCREDITED INVESTOR”, AND (B) IS A “PERMITTED CLIENT” AS SUCH TERM IS DEFINED IN SECTION 1.1 NATIONAL INSTRUMENT 31-103 – REGISTRATION REQUIREMENTS, EXEMPTIONS AND ONGOING REGISTRANT OBLIGATIONS (“NI 31-103”) AND, IF APPLICABLE, IS PURCHASING THE TREP TOKENS FROM A DEALER PERMITTED TO RELY ON THE “INTERNATIONAL DEALER EXEMPTION” CONTAINED IN SECTION 8.18 OF NI 31-103; (V) SUCH INVESTOR IS NOT A PERSON CREATED OR USED SOLELY TO PURCHASE OR HOLD SECURITIES AS AN “ACCREDITED INVESTOR”; AND (VI) SUCH INVESTOR CERTIFIES THAT NONE OF THE FUNDS BEING USED TO PURCHASE THE TREP TOKENS ARE, TO ITS KNOWLEDGE, PROCEEDS OBTAINED OR DERIVED AS A RESULT OF ILLEGAL ACTIVITIES AND THAT: (A) THE FUNDS BEING USED TO PURCHASE THE TREP TOKENS DO NOT

REPRESENT PROCEEDS OF CRIME FOR THE PURPOSE OF THE CRIMINAL CODE (CANADA) OR THE PROCEEDS OF CRIME (MONEY LAUNDERING) AND TERRORIST FINANCIAL ACT (CANADA) OR ANY REGULATIONS ADOPTED UNDER THE SPECIAL ECONOMIC MEASURES ACT (CANADA) OR THE UNITED NATIONS ACT (CANADA) (COLLECTIVELY, THE “CANADIAN AML AND ECONOMIC SANCTIONS LEGISLATION”) AND (B) THE COMPANY MAY IN THE FUTURE BE REQUIRED BY LAW TO DISCLOSE SUCH INVESTOR’S NAME AND OTHER INFORMATION RELATING TO THE INVESTOR, ON A CONFIDENTIAL BASIS, PURSUANT TO THE CANADIAN AML AND ECONOMIC SANCTIONS LEGISLATION OR AS OTHERWISE MAY BE REQUIRED BY APPLICABLE LAWS, REGULATIONS OR RULES. IN ADDITION, EACH CANADIAN INVESTOR WHICH SUBSCRIBES FOR TREP TOKENS WILL BE DEEMED TO HAVE REPRESENTED TO THE COMPANY AND ANY DEALER WHICH SELLS THE TREP TOKENS TO SUCH INVESTOR THAT: (I) IT HAS BEEN NOTIFIED BY THE COMPANY (A) THAT THE COMPANY IS REQUIRED TO PROVIDE INFORMATION (THE “PERSONAL INFORMATION”) PERTAINING TO SUCH INVESTOR AS REQUIRED TO BE DISCLOSED IN SCHEDULE I OF FORM 45-106F1 UNDER NI 45-106 (INCLUDING ITS NAME, ADDRESS, TELEPHONE NUMBER AND THE NUMBER AND VALUE OF ANY TREP TOKENS PURCHASED); (B) SUCH PERSONAL INFORMATION WILL BE DELIVERED TO THE SECURITIES REGULATORY AUTHORITY OR REGULATOR IN ACCORDANCE WITH NI 45-106; (C) SUCH PERSONAL INFORMATION IS BEING COLLECTED INDIRECTLY BY THE SECURITIES REGULATORY AUTHORITY OR REGULATOR UNDER THE AUTHORITY GRANTED TO IT UNDER THE SECURITIES LEGISLATION OF THE APPLICABLE LEGISLATION; (D) SUCH PERSONAL INFORMATION IS BEING COLLECTED FOR THE PURPOSES OF THE ADMINISTRATION AND ENFORCEMENT OF THE SECURITIES LEGISLATION OF APPLICABLE LEGISLATION; AND (E) THE PUBLIC OFFICIAL IN ONTARIO WHO CAN ANSWER QUESTIONS ABOUT THE ONTARIO SECURITIES COMMISSION’S

INDIRECT COLLECTION OF SUCH PERSONAL INFORMATION IS THE INQUIRIES OFFICER AT THE ONTARIO SECURITIES COMMISSION, 20 QUEEN STREET WEST, TORONTO, ONTARIO M5H 3S8, TELEPHONE: (416) 593-8314; AND (II) BY PURCHASING TREP TOKENS, SUCH INVESTOR HAS AUTHORIZED THE INDIRECT

COLLECTION OF THE PERSONAL INFORMATION BY THE SECURITIES REGULATORY AUTHORITY OR REGULATOR. FURTHER, SUCH INVESTOR ACKNOWLEDGES THAT ITS, HIS OR HER NAME, ADDRESS, TELEPHONE NUMBER, AND OTHER SPECIFIED INFORMATION, INCLUDING THE NUMBER OF TREP TOKENS IT, HE OR SHE HAS PURCHASED AND THE AGGREGATE PURCHASE PRICE TO INVESTOR, MAY BE DISCLOSED TO OTHER CANADIAN SECURITIES REGULATORY AUTHORITIES AND MAY BECOME AVAILABLE TO THE PUBLIC IN ACCORDANCE WITH THE REQUIREMENTS OF APPLICABLE LAWS. BY PURCHASING THE TREP TOKENS, EACH CANADIAN INVESTOR CONSENTS TO THE DISCLOSURE OF SUCH INFORMATION.

 

SUMMARY OF RIGHTS OF ACTION FOR DAMAGES OR RESCISSION IN CERTAIN CANADIAN JURISDICTIONS SECURITIES LEGISLATION IN CERTAIN PROVINCES OR TERRITORIES OF CANADA MAY PROVIDE A CANADIAN INVESTOR WITH REMEDIES FOR RESCISSION OR DAMAGES IF THIS MEMORANDUM (INCLUDING ANY AMENDMENT THERETO) CONTAINS A MISREPRESENTATION, PROVIDED THAT THE REMEDIES FOR RESCISSION OR DAMAGES ARE EXERCISED BY SUCH INVESTOR WITHIN THE TIME LIMIT PRESCRIBED BY THE SECURITIES LEGISLATION OF SUCH INVESTOR’S PROVINCE OR TERRITORY. CANADIAN INVESTORS SHOULD REFER TO ANY APPLICABLE PROVISIONS OF THE SECURITIES LEGISLATION OF SUCH INVESTOR’S PROVINCE OR TERRITORY FOR PARTICULARS OF THESE RIGHTS OR CONSULT WITH A LEGAL ADVISOR.

 

NOTICE TO RESIDENTS OF CAYMAN ISLANDS

 

NO OFFER OR INVITATION MAY BE MADE TO THE PUBLIC IN THE CAYMAN ISLANDS TO PURCHASE THE TREP TOKENS. THIS MEMORANDUM SHALL NOT CONSTITUTE AN OFFER, INVITATION, OR SOLICITATION TO ANY MEMBER OF THE PUBLIC IN THE CAYMAN ISLANDS TO PURCHASE ANY TREP TOKENS. TREP TOKENS MAY BE BENEFICIALLY OWNED BY PERSON RESIDENT, DOMICILED, ESTABLISHED, INCORPORATED OR REGISTERED PURSUANT TO THE LAWS OF THE CAYMAN ISLANDS. THE COMPANY, HOWEVER, WILL NOT UNDERTAKE BUSINESS WITH THE PUBLIC IN THE CAYMAN ISLANDS OTHER THAN SO FAR AS MAY BE NECESSARY FOR THE CARRYING ON OF THE BUSINESS OF THE COMPANY EXTERIOR TO THE CAYMAN ISLANDS. “PUBLIC” FOR PURPOSE OF THIS PROVISION DOES NOT INCLUDE (I) ANY LIMITED LIABILITY COMPANY REGISTERED UNDER THE LIMITED LIABILITY COMPANIES LAW (2018 REVISION), (II) ANY EXEMPTED OR ORDINARY NON-RESIDENT COMPANY REGISTERED UNDER THE COMPANIES LAW (2018 REVISION), (III) A FOREIGN COMPANY REGISTERED PURSUANT TO PART IX OF THE COMPANIES LAW (2018 REVISION), (IV) A FOREIGN LIMITED PARTNERSHIP REGISTERED UNDER SECTION 42 OF THE EXEMPTED LIMITED PARTNERSHIP LAW (2018 REVISION), (V) ANY COMPANY ACTING AS GENERAL PARTNER OF A PARTNERSHIP REGISTERED UNDER SECTION 9(1) OF THE EXEMPTED LIMITED PARTNERSHIP LAW (2018 REVISION) OR (VI) ANY DIRECTOR OR OFFICER OF THE SAME ACTING IN THAT CAPACITY OR THE TRUSTEE OF ANY TRUST REGISTERED OR CAPABLE OF REGISTRATION UNDER SECTION 74 OF THE TRUSTS LAW (2018 REVISION) ACTING IN THAT CAPACITY.

 

NOTICE TO RESIDENTS OF FRANCE

 

THE TREP TOKENS ARE NOT BEING OFFERED TO THE PUBLIC IN FRANCE. DISTRIBUTION OF THIS MEMORANDUM AND THE ISSUANCE OF THE TREP TOKENS MAY BE RESTRICTED IN CERTAIN JURISDICTIONS. IT IS THE RESPONSIBILITY OF ANY PERSON IN POSSESSION OF THE TREP TOKENS OR RELATED DOCUMENTS AND ANY PERSON WISHING TO SUBSCRIBE FOR THE TREP TOKENS TO INFORM THEMSELVES OF AND OBSERVE ALL APPLICABLE LAWS AND REGULATIONS OF ANY RELEVANT JURISDICTIONS. NO ACTION HAS BEEN TAKEN THAT WOULD OR IS INTENDED TO, PERMIT A PUBLIC OFFER OF THE TREP TOKENS IN ANY COUNTRY OR JURISDICTION WHERE ANY SUCH ACTION FOR THAT PURPOSE IS REQUIRED. ACCORDINGLY, THE TREP TOKENS MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, AND NEITHER THIS DOCUMENT NOT ANY OTHER INFORMATION FOR OF APPLICATION, ADVERTISEMENT, OR OTHER DOCUMENT MAY BE DISTRIBUTED OR PUBLISHED IN ANY COUNTRY OR JURISDICTION EXCEPT UNDER CIRCUMSTANCES THAT WILL RESULT IN COMPLIANCE WITH ANY APPLICABLE LAWS AND REGULATIONS. THE COMPANY IS NOT MAKING ANY REPRESENTATION OR WARRANTY TO ANY PROSPECTIVE PURCHASE REGARDING THE LEGALITY OF AN INVESTMENT IN THE TREP TOKENS BY SUCH PERSON UNDER APPROPRIATE SECURITIES OR SIMILAR LAWS. INVESTING IN THE TREP TOKENS INVOLVES CERTAIN RISKS. IN PARTICULAR, EACH PROSPECTIVE INVESTOR IN THE TREP TOKENS SHOULD PROCEED ON THE ASSUMPTION THAT A PURCHASER OF THE TREP TOKENS MUST BEAR ECONOMIC RISKS OF SUCH AN INVESTMENT. PURCHASERS SHOULD NOT TREAT THE CONTENT OF THESE DOCUMENTS AS ADVICE RELATING TO LEGAL, TAXATION, OR INVESTMENT MATTERS AND ARE ADVISED TO CONSULT THEIR OWN PROFESSIONAL ADVISERS CONCERNING THE SUBSCRIPTION OF THE TREP TOKENS OR BOTH AND CONSEQUENCES THEREOF. ACCORDINGLY, PURCHASERS SHOULD INFORM THEMSELVES AS TO (A) THE POSSIBLE TAX CONSEQUENCES, (B) THE LEGAL REQUIREMENTS, AND (C) ANY FOREIGN EXCHANGE RESTRICTIONS OR EXCHANGE CONTROL REQUIREMENTS, WHICH THEY MIGHT ENCOUNTER UNDER THE LAWS OF THE COUNTRIES OF THEIR CITIZENSHIP, RESIDENCE OR DOMICILE AND WHICH MIGHT BE RELEVANT TO THE SUBSCRIPTION, HOLDING OR DISPOSAL OF TREP TOKENS.

 

NOTICE TO RESIDENTS OF GERMANY

 

THE COMPANY DOES NOT INTEND TO OFFER THE TREP TOKENS TO THE PUBLIC IN GERMANY. THE TREP TOKENS AND ANY DOCUMENTS USED IN CONNECTION THEREWITH DO NOT CONSTITUTE A PUBLIC OFFER OR AN INVITATION TO MAKE OFFERS, TO SELL, PURCHASE, EXCHANGE OR OTHERWISE TRANSFER THE TREP TOKENS IN OR TO GERMANY. THE TREP TOKENS HAVE NOT BEEN OFFERED OR SOLD, AND WILL NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, TO OR FOR THE BENEFIT OF ANY PERSON OR ENTITY RESIDENT, INCORPORATED, ESTABLISHED OR HAVING THEIR USUAL RESIDENCE IN GERMANY, EXCEPT AS MAY BE PERMITTED BY THE GERMAN SECURITIES TRADING ACT (WERTPAPIERHANDELSGESETZ - WPHG), THE EU PROSPECTUS REGULATION (REGULATION (EU) 2017/1129 OF 14 JUNE 2017, THE GERMAN SECURITIES PROSPECTUS ACT (WERTPAPIERPROSPEKTGESETZ - WPPG)AND GERMAN CAPITAL INVESTMENT ACT (VERMÖGENSANLAGEGESETZ – VERMANLG) WITHOUT THE COMPANY BECOMING SUBJECT TO ANY SUCH LAWS.

 

NOTICE TO RESIDENTS OF HONG KONG

 

THE COMPANY:

 

(1) HAS NOT OFFERED OR SOLD AND WILL NOT OFFER OR SELL TREP TOKENS IN HONG KONG, BY MEANS OF ANY DOCUMENT, OTHER THAN (A) TO “PROFESSIONAL INVESTORS” AS DEFINED IN THE SECURITIES AND FUTURES ORDINANCE (CAP. 571) OF HONG KONG AND ANY RULES MADE UNDER THAT ORDINANCE; OR (B) IN OTHER CIRCUMSTANCES WHICH DO NOT RESULT IN THE DOCUMENT BEING A “PROSPECTUS” AS DEFINED IN THE COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE (CAP. 32) OF HONG KONG OR WHICH DO NOT CONSTITUTE AN OFFER TO THE PUBLIC WITHIN THE MEANING OF THAT ORDINANCE; AND (2) HAS NOT ISSUED OR HAD IN ITS POSSESSION FOR THE PURPOSES OF ISSUING, AND WILL NOT ISSUE  OR HAVE IN ITS POSSESSION FOR THE PURPOSES OF ISSUING, WHETHER IN HONG KONG OR ELSEWHERE, ANY ADVERTISEMENT, INVITATION OR DOCUMENT RELATING TO THE TREP TOKENS, WHICH IS DIRECTED AT, OR THE CONTENTS OF WHICH ARE LIKELY TO BE ACCESSED OR READ BY, THE PUBLIC OF HONG KONG (EXCEPT IF PERMITTED TO DO SO UNDER THE SECURITIES LAWS OF HONG KONG) OTHER THAN WITH RESPECT TO TREP TOKENS WHICH ARE OR ARE INTENDED TO BE DISPOSED OF ONLY TO PERSONS OUTSIDE HONG KONG OR ONLY TO “PROFESSIONAL INVESTORS” AS DEFINED IN THE SECURITIES AND FUTURES ORDINANCE AND ANY RULES MADE UNDER THAT ORDINANCE.

 

NOTICE TO RESIDENTS OF INDIA

 

THE TREP TOKENS AND ANY DOCUMENTS USED IN CONNECTION THEREWITH AND ANY RELATED DOCUMENTS DO NOT CONSTITUTE AN OFFER TO SELL TO OR AN OFFER TO BUY INTEREST FROM ANY PERSON OTHER THAN THE PERSON TO WHOM THIS DOCUMENT HAS BEEN SENT BY THE COMPANY OR ITS AUTHORIZED AGENTS. THE TREP TOKENS AND ANY DOCUMENTS USED IN CONNECTION THEREWITH SHOULD NOT BE CONSTRUED AS A PROSPECTUS. THE TREP TOKENS AND ANY DOCUMENTS USED IN CONNECTION THEREWITH ARE NOT BEING OFFERED FOR SALE OR SUBSCRIPTION BUT ARE BEING PRIVATELY PLACED WITH A LIMITED NUMBER OF SOPHISTICATED INVESTORS, AND PROSPECTIVE INVESTORS MUST OBTAIN LEGAL ADVICE THAT THEY ARE ENTITLED TO SUBSCRIBE TO THESE INSTRUMENTS AND MUST COMPLY WITH ALL RELEVANT INDIAN LAWS IN THIS RESPECT.

 

NOTICE TO RESIDENTS OF ISRAEL

 

THE COMPANY DOES NOT INTEND TO OFFER THE TREP TOKENS TO THE PUBLIC IN ISRAEL WITHIN THE MEANING OF THE ISRAELI SECURITIES LAW, 1968, OR OFFER THE TREP TOKENS, WITHIN ANY SPECIFIC YEAR, TO MORE THAN 35 OFFEREES RESIDENT IN ISRAEL. EACH PROSPECTIVE INVESTOR MUST AND HEREBY DOES WARRANT TO THE COMPANY THAT IT IS PURCHASING THE TREP TOKENS FOR INVESTMENT PURPOSES ONLY AND NOT FOR PURPOSES OF RESALE.

 

NOTICE TO RESIDENTS OF ITALY

 

THE TREP TOKENS MAY BE SUBSCRIBED BY INSTITUTIONAL INVESTORS PURSUANT TO ARTICLE 31, PARAGRAPH 2 OF THE CONSOB REGULATION NO. 11522 OF 1 JULY 1998, AS SUBSEQUENTLY AMENDED AND INTEGRATED ONLY. NEITHER THE TREP TOKENS NOR THIS MEMORANDUM CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY ANY THE TREP TOKENS IN THE ITALIAN JURISDICTION TOWARDS PRIVATE INVESTORS. ACCORDINGLY, THE TREP TOKENS OR MEMORANDUM ARE FOR INFORMATION PURPOSES ONLY, WHERE DIRECTED TO A PRIVATE INVESTOR WHO IS AN ITALIAN RESIDENT. PURSUANT TO THIS MEMORANDUM, THE TREP TOKENS WILL ONLY BE OFFERED TO, AND SUBSCRIPTIONS WILL ONLY BE ACCEPTED FROM, ITALIAN INSTITUTIONAL INVESTORS AS DEFINED ABOVE. THE TREP TOKENS TO BE OFFERED PURSUANT TO THIS MEMORANDUM HAVE NOT BEEN OR WILL NOT BE REGISTERED UNDER THE RELEVANT SECURITIES LAWS OF ITALY TO BE OFFERED TO AND TO BE SUBSCRIBED BY PRIVATE INVESTORS.

 

NOTICE TO RESIDENTS OF JAPAN

 

THE TREP TOKENS ARE BEING OFFERED TO A LIMITED NUMBER OF QUALIFIED INSTITUTIONAL INVESTORS (TEKIKAKU KIKAN TOSHIBA, AS DEFINED IN THE SECURITIES EXCHANGE LAW OF JAPAN (LAW NO. 25 OF 1948, AS AMENDED)) OR A SMALL NUMBER OF INVESTORS, IN ALL CASES UNDER CIRCUMSTANCES THAT WILL FALL WITHIN THE PRIVATE PLACEMENT EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES EXCHANGE LAW AND OTHER RELEVANT LAWS AND REGULATIONS OF JAPAN. AS SUCH, THE TREP TOKENS HAVE NOT BEEN REGISTERED AND WILL NOT BE REGISTERED UNDER THE SECURITIES EXCHANGE LAW OF JAPAN. THE PURCHASER OF THE TREP TOKENS AGREES NOT TO RE-TRANSFER OR RE-ASSIGN THE TREP TOKENS TO ANYONE OTHER THAN NONRESIDENTS OF JAPAN EXCEPT PURSUANT TO A PRIVATE PLACEMENT EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF, AND OTHERWISE IN COMPLIANCE WITH, THE SECURITIES EXCHANGE LAW AND OTHER RELEVANT LAWS AND REGULATIONS OF JAPAN.

 

NOTICE TO RESIDENTS OF NEW ZEALAND

 

THE TREP TOKENS OFFERED OR SOLD TO INVESTORS IN NEW ZEALAND ARE ONLY AVAILABLE TO, AND MAY ONLY BE ACCEPTED BY, A WHOLESALE INVESTOR PURSUANT TO CLAUSE 3(2) AND 3(3) OF SCHEDULE 1 OF THE NEW ZEALAND FINANCIAL MARKETS CONDUCT ACT OF 2013 WHO HAS COMPLETED

A WHOLESALE INVESTOR CERTIFICATE OR AN ELIGIBLE INVESTOR CERTIFICATE OR WHO INVESTS A MINIMUM AMONG OF NZ $ 750,000 IN THE TREP TOKENS. PURCHASER ACKNOWLEDGES AND AGREES THAT PURCHASER HAS NOT OFFERED OR SOLD, AND WILL NOT OFFER OR SELL, DIRECTLY OR INDIRECTLY, THE TREP TOKENS; PURCHASER HAS NOT DISTRIBUTED AND WILL NOT DISTRIBUTE, DIRECTLY OR INDIRECTLY, THIS MEMORANDUM OR ANY OTHER OFFERING MATERIALS OR ADVERTISEMENTS IN RELATION TO ANY OFFER OF THE TREP TOKENS; IN EACH CASE IN NEW ZEALAND OTHER THAN TO A PERSON WHO IS A WHOLESALE INVESTOR; AND PURCHASER WILL NOTIFY ISSUER IF PURCHASER CEASES TO BE A WHOLESALE INVESTOR.

 

NOTICE TO RESIDENTS OF SINGAPORE

 

THIS MEMORANDUM HAS NOT BEEN REGISTERED AS A PROSPECTUS WITH THE MONETARY AUTHORITY OF SINGAPORE. ACCORDINGLY, THE COMPANY HAS NOT OFFERED OR SOLD ANY TREP TOKENS OR CAUSED THE TREP TOKENS TO BE MADE THE SUBJECT OF AN INVITATION FOR SUBSCRIPTION OR PURCHASE AND WILL NOT OFFER OR SELL ANY TREP TOKENS OR CAUSE THE TREP TOKENS TO BE MADE THE SUBJECT OF AN INVITATION FOR SUBSCRIPTION OR PURCHASE, AND HAS NOT CIRCULATED OR DISTRIBUTED, NOR WILL IT CIRCULATE OR DISTRIBUTE, THIS MEMORANDUM, OR ANY OTHER DOCUMENT OR MATERIAL IN CONNECTION WITH THE OFFER OR SALE, OR INVITATION FOR SUBSCRIPTION OR PURCHASE, OF THE TREP TOKENS, WHETHER DIRECTLY OR INDIRECTLY, TO ANY PERSON IN SINGAPORE OTHER THAN (I) TO AN INSTITUTIONAL INVESTOR (AS DEFINED IN SECTION 4A OF THE SECURITIES AND FUTURES ACT (CHAPTER 289 OF SINGAPORE) (THE “SFA”)) PURSUANT TO SECTION 274 OF THE SFA, (II) TO A RELEVANT PERSON (AS DEFINED IN SECTION 275(2) OF THE SFA) PURSUANT TO SECTION 275(1) OF THE SFA, OR ANY PERSON PURSUANT TO SECTION 275(1A) OF THE SFA, AND IN ACCORDANCE WITH THE CONDITIONS SPECIFIED IN SECTION 275 OF THE SFA, OR (III) OTHERWISE PURSUANT TO, AND IN ACCORDANCE WITH THE CONDITIONS OF, ANY OTHER APPLICABLE PROVISION OF THE SFA.

 

WHERE THE TREP TOKENS ARE SUBSCRIBED OR PURCHASED UNDER SECTION 275 OF THE SFA BY A RELEVANT PERSON, WHICH IS:

 

(A) A CORPORATION (WHICH IS NOT AN ACCREDITED INVESTOR (AS DEFINED IN SECTION 4A OF THE SFA)) THE SOLE BUSINESS OF WHICH IS TO HOLD INVESTMENTS AND THE ENTIRE SHARE CAPITAL OF WHICH IS OWNED BY ONE OR MORE INDIVIDUALS, EACH OF WHOM IS AN ACCREDITED INVESTOR; OR

 

(B) A TRUST (WHERE THE TRUSTEE IS NOT AN ACCREDITED INVESTOR) WHOSE SOLE PURPOSE IS TO HOLD INVESTMENTS AND EACH BENEFICIARY OF THE TRUST IS AN INDIVIDUAL WHO IS AN ACCREDITED INVESTOR, SECURITIES (AS DEFINED IN SECTION 239(1) OF THE SFA) OF THAT CORPORATION OR THE BENEFICIARIES’ RIGHTS AND INTEREST (HOWSOEVER DESCRIBED) IN THAT TRUST SHALL NOT BE TRANSFERRED WITHIN SIX MONTHS AFTER THAT CORPORATION OR THAT TRUST HAS ACQUIRED THE TREP TOKENS PURSUANT TO AN OFFER MADE UNDER SECTION 275 OF THE SFA EXCEPT:

 

(1) TO AN INSTITUTIONAL INVESTOR OR A RELEVANT PERSON DEFINED IN SECTION 275(2) OF THE SFA, OR TO ANY PERSON ARISING FROM AN OFFER REFERRED TO IN SECTION 275(1A) OR SECTION 276(4)(I)(B) OF THE SFA;

 

(2) WHERE NO CONSIDERATION IS OR WILL BE GIVEN FOR THE TRANSFER;

 

(3) WHERE THE TRANSFER IS BY OPERATION OF LAW;

 

(4) AS SPECIFIED IN SECTION 276(7) OF THE SFA; OR

 

(5) AS SPECIFIED IN REGULATION 32 OF THE SECURITIES AND FUTURES (OFFERS OF INVESTMENTS) (SHARES AND DEBENTURES) REGULATIONS 2005 OF SINGAPORE.

 

NOTICE TO RESIDENTS OF SWITZERLAND

 

TREP TOKENS MAY NOT BE PUBLICLY OFFERED IN SWITZERLAND AND WILL NOT BE LISTED ON THE SIX SWISS EXCHANGE (“SIX”) OR ON ANY OTHER STOCK EXCHANGE OR REGULATED TRADING FACILITY IN SWITZERLAND. TREP TOKENS AND ANY RELATED DOCUMENTS HAVE BEEN PREPARED WITHOUT REGARD TO THE DISCLOSURE STANDARDS FOR ISSUANCE PROSPECTUSES UNDER ART. 652A OR ART. 1156 OF THE SWISS CODE OF OBLIGATIONS OR THE DISCLOSURE STANDARDS FOR LISTING PROSPECTUSES UNDER ART. 27 FF. OF THE SIX LISTING RULES OR THE LISTING RULES OF ANY OTHER STOCK EXCHANGE OR REGULATED TRADING FACILITY IN SWITZERLAND. NEITHER TREP TOKENS NOR ANY RELATED MARKETING MATERIAL MAY BE PUBLICLY DISTRIBUTED OR OTHERWISE MADE

PUBLICLY AVAILABLE IN SWITZERLAND. TREP TOKENS AND ANY RELATED MARKETING MATERIALS HAVE NOT BEEN AND WILL NOT BE FILED WITH OR APPROVED BY ANY SWISS REGULATORY AUTHORITY, PARTICULARLY INCLUDING THE SWISS FINANCIAL MARKET SUPERVISORY AUTHORITY, AND THEY HAVE NOT BEEN AUTHORIZED UNDER THE SWISS FEDERAL ACT ON COLLECTIVE INVESTMENT SCHEMES (“CISA”). THE PROTECTIONS AFFORDED TO ACQUIRERS OF INTERESTS IN COLLECTIVE INVESTMENT SCHEMES UNDER THE CISA DO NOT EXTEND TO PURCHASERS OF TREP TOKENS.

 

NOTICE TO RESIDENTS OF TAIWAN

 

THE TREP TOKENS HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE FINANCIAL SUPERVISORY COMMISSION OF TAIWAN. THE TREP TOKENS MAY NOT BE SOLD, ISSUED, OR OFFERED WITHIN TAIWAN THROUGH A PUBLIC OFFERING OR IN CIRCUMSTANCES THAT CONSTITUTE AN OFFER WITHIN THE

MEANING OF THE SECURITIES AND EXCHANGE ACT OF TAIWAN THAT REQUIRES A REGISTRATION OR APPROVAL OF THE FINANCIAL SUPERVISORY COMMISSION OF TAIWAN. NO PERSON OR ENTITY IN TAIWAN HAS BEEN AUTHORIZED TO OFFER, SELL, GIVE ADVICE REGARDING OR OTHERWISE INTERMEDIATE THE OFFERING AND SALE OF THE TREP TOKENS IN TAIWAN.

 

NOTICE TO RESIDENTS OF THAILAND

 

THE TREP TOKENS HAVE NOT BEEN, AND WILL NOT BE, REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OF THAILAND. THEREFORE, THE TREP TOKENS CAN NOT BE OFFERED OR SOLD IN THAILAND, AND NO INVITATION CAN BE MADE, WHETHER DIRECTLY OR INDIRECTLY, TO INVESTORS IN THAILAND TO PURCHASE THE TREP TOKENS. DISTRIBUTION OF THIS MEMORANDUM OR ANY DOCUMENT OR MATERIAL IN CONNECTION WITH THE OFFER, SALE, OR INVITATION FOR PURCHASE OF THE TREP TOKENS IN THAILAND IS ALSO NOT ALLOWED, EXCEPT AS OTHERWISE PERMITTED BY APPLICABLE THAI LAWS AND REGULATIONS.

 

NOTICE TO RESIDENTS OF THE UNITED KINGDOM

 

THE COMPANY HAS ONLY COMMUNICATED OR CAUSED TO BE COMMUNICATED AND WILL ONLY COMMUNICATE OR CAUSE TO BE COMMUNICATED AN INVITATION OR INDUCEMENT TO ENGAGE IN INVESTMENT ACTIVITY (WITHIN THE MEANING OF SECTION 21 OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (“FSMA”) RECEIVED BY IT IN CONNECTION WITH THE ISSUE OR SALE OF THE TREP TOKENS IN CIRCUMSTANCES IN WHICH SECTION 21(1) OF THE FSMA DOES NOT APPLY TO THE COMPANY, AND IT HAS COMPLIED AND WILL COMPLY WITH ALL APPLICABLE PROVISIONS OF THE FSMA WITH RESPECT TO ANYTHING DONE BY IT IN RELATION TO THE TREP TOKENS IN, FROM OR OTHERWISE INVOLVING THE UNITED KINGDOM NOTICE TO RESIDENTS OF ALL OTHER JURISDICTIONS NO ACTION HAS BEEN TAKEN TO PERMIT THE OFFER, SALE, POSSESSION OR DISTRIBUTION OF THE TREP TOKENS OR ANY RELATED DOCUMENTS IN ANY JURISDICTION WHERE ACTION FOR THAT PURPOSE IS REQUIRED. YOU ARE REQUIRED TO INFORM YOURSELF ABOUT AND TO OBSERVE ANY RESTRICTIONS RELATING TO THE TREP TOKENS AND ANY RELATED DOCUMENTS IN YOUR JURISDICTION.

 

 

 

EXHIBIT A

OPERATING AGREEMENT OF

TREP, LLC

 

A WYOMING LIMITED LIABILITY COMPANY

 

This Operating Agreement (this “Agreement”) of TREP, LLC, a Wyoming limited liability company (the “Company”), is made and entered into effective as of February 1, 2022, by and among the voting Members. Unless otherwise provided in this Agreement, capitalized terms used in this Agreement will have the meaning given to them in Article 13.

 

RECITALS

 

WHEREAS, the Company was formed on February 1, 2022, pursuant to the filing of Certificate of Formation with the Sectary of Sate of the State of Wyoming; and

 

WHEREAS, the Members desire to enter into this Agreement.

 

AGREEMENT

 

ARTICLE 1

THE COMPANY

 

1.1       FORMATION AND TAX CLASSIFICATION. The Company has been formed as a limited liability company under and pursuant to the Act. Each Member represents and warrants that such Member is duly authorized to join in this Agreement and that the person executing this Agreement on its behalf is duly authorized to do so. The Members intend that the Company will be classified as a partnership for federal, state, and local income and franchise tax purposes, and each Member and the Company will file all tax returns and will otherwise take all tax and financial reporting positions in a manner consistent with such treatment. The Members intend that the Company will not be a partnership (including, without limitation, a limited partnership) for any other purpose.

 

1.2       COMPANY NAME. The name of the Company is TREP, LLC. The business of the Company will be conducted under such name or such other names deemed advisable by the Board.

 

1.3       PURPOSES.

 

(a)       The Company is formed for the object and purpose of, and the nature of the business to be conducted and promoted by the Company is, engaging in any lawful act or activity for which limited liability companies may be formed under the Act. Notwithstanding the foregoing, the Company has been organized to invest in commercial, residential, mixed-used real estate, mortgage loans, tax lien certificates, and tax lien certificate managed funds, government securities, cryptocurrencies, asset-backed tokens, and undertake certain actions with respect thereto.

(b)       The Company shall possess and may exercise all the powers and privileges granted by the Wyoming Act or by any other law or by this Agreement, together with any powers incidental thereto, which are necessary or convenient to the conduct, promotion, or attainment of the business, purposes or activities of the Company.

1.4       PRINCIPAL PLACE OF BUSINESS. The initial principal place of business of the Company is located at 1309 Coffeen Avenue, STE 1200, Sheridan, Wyoming 82801. The principal place of business of the Company may be relocated from time to time by determination of the Board. The Company may maintain offices at such other place or places as the Board deems advisable.

 

1.5       REGISTERED AGENT AND REGISTERED OFFICE. The name and address of the Company’s registered agent for service of process on the Company in the State of Wyoming will be Cloud Peak Law, LLC at 1309 Coffeen Avenue, STE 1200, Sheridan, Wyoming 82801. The Board may change, at any time and from time to time, such registered agent. The Company’s registered office in the State of Wyoming will be the address of the Company’s registered agent for service of process. The Board may change, at any time and from time to time, such registered office.

 

1.6       TERM. The term of the Company commenced upon the filing of its Certificate of Formation with the Wyoming Secretary of State on February 1, 2022, in accordance with the Act and will continue in existence for perpetuity, unless dissolved or terminated in accordance with either the provisions of this Agreement or the Act.

 

ARTICLE 2

MEMBERS AND UNITS

 

2.1 CAPITALIZATION

 

            (a)       Authorized Units. The interest of the Members in the Company will be represented by Units, which will entitle the holder to the rights set forth in this Agreement and subject the holder to the terms and conditions set forth in this Agreement. The Units may be recorded in electronic or digital crypto tokens or coins, or in any other form, as determined by the Board as may be permitted by the Act. The Company has the authority to issue 2,000 Class A Units, 50,000,000 Class B Units, and 75,000,000 Class C Units. It is not necessary that all authorized Units be issued or outstanding. All Units issued hereunder will be certificated unless otherwise determined by the Board.

 

            (b)       Class A Units. The holders of Class A Units shall own twenty-five percent (25%) equity/ownership in the Company and are entitled to receive twenty-five (25%) of the Company’s net profit (after paying Company’s expenses as well as other fees mentioned herewith). The holders of Class A Units shall have one (1) voting right per Class A Unit held by the Member.

 

            (c)       Class B Units and Class C Units. The holder of Class B Units and Class C Units shall own seventy-five percent (75%) of the Company and are entitled to seventy-five (75%) of the Company’s net profit combined (after paying Company’s expenses as well as other fees mentioned herewith). The holder of Class B and Class C Units shall have no voting rights whoever.

 

            (d)       Class C Units. 75,000,000 Class C Units are reserved for the Company’s future offering of securities in reliance on Regulation A under the Securities Act. Such securities pursuant to Regulation A shall be issued upon qualification of the offering by the SEC. The Company can raise a maximum of $75 million under Regulation A+, Tier II offering.

 

2.2       VOTING.

(a)       Generally. Unless expressly required herein, any event, transaction, or occurrence requiring approval of the Members will be deemed to require a vote of a Majority in Interest of the Members, either at a meeting or in writing pursuant to Section 2.2(b).

 

            (b)       Meeting of Members.

 

                        (i)         Meetings. Meetings of the Members will be held at such date and time as the Board may fix from time to time. Additionally, a special meeting may be called by any Member or Members holding a majority of the Units entitled to vote on the matter(s) to be considered at the meeting.

 

                        (ii)        Place of Meeting. The Board may designate any place as the place of meeting for any meeting of the Members. If no designation is made, or if a special meeting is called by any Member or Members pursuant to this Section 2.2(b)(ii), the place of meeting will be the principal executive office of the Company.

 

                        (iii)       Notice of Meetings. Except as provided in Section 2.2(b)(vi), written notice stating the place, day, and hour of the meeting and the purpose or purposes for which the meeting is called will be delivered not less than 3 nor more than 60 days before the date of the meeting, either personally or by mail or email, by or at the direction of the Board or person calling the meeting, to each Member entitled to vote at such meeting. If mailed, such notice will be deemed to be delivered as provided in Section 12.1.

 

                        (iv)      Meeting of All Members. If all of the Members consent to the holding of a meeting at such time and place, such meeting will be valid without call or notice, and at such meeting, lawful action may be taken.

 

                        (v)       Record Date. For the purpose of determining Members entitled to notice of or to vote at any meeting of Members or any adjournment thereof, or in order to make a determination of Members for any other purpose, the date on which notice of the meeting is mailed or the date on which the resolution declaring such distribution is adopted, as the case may be, will be the record date for such determination of Members. When a determination of Members entitled to vote at any meeting of Members has been made as provided in this Section 2.3(b)(v), such determination will apply to any adjournment thereof.

 

                        (vi)      Quorum. Members representing a Majority in Interest of the Members, present in person or represented by proxy, will constitute a quorum at any meeting of Members. In the absence of a quorum at any such meeting, Members holding a majority of the Units so represented may adjourn the meeting from time to time for a period not to exceed 60 days without further notice. However, if the adjournment is for more than 60 days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting will be given to each Member of record entitled to vote at the meeting. At such adjourned meeting at which a quorum will be present or represented, any business may be transacted that might have been transacted at the meeting as originally noticed. Members present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal during such meeting of Members holding interests whose absence would cause less than a quorum.

 

                        (vii)     Manner of Acting. With respect to any matter to be considered at a meeting of the Members, the affirmative vote of a Majority in Interest of the Members will be the act of the Members unless the vote of a greater or lesser proportion or number is otherwise required by this Agreement or applicable law.

 

                        (viii)    Proxies. At all meetings of Members, a Member may vote in person or by proxy executed in writing by the Member or by a duly authorized attorney-in-fact. Such proxy will be filed with the Board before or at the time of the meeting. No proxy will be valid after 11 months from the date of its execution unless otherwise provided in the proxy.

 

                        (ix)      Action by Members Without a Meeting. Action required or permitted to be taken at a meeting of Members may be taken without a meeting if the action is evidenced by one or more written consents describing the action taken, signed, and delivered to the Secretary within 60 days of the record date for that action, by Members having not less than the minimum number of votes that would be necessary to authorize or take that action at a meeting at which all Members entitled to vote on that action were present and voted. All such consents will be delivered to the Secretary of the Company for inclusion in the minutes or filing with the Company records. Action taken under this Section 2.3(b)(ix) is effective when such number of consents required to authorize the proposed action will have been received by the Secretary unless the consent specifies a different effective date. Any Member giving a written consent may revoke the consent by a writing received by the Secretary before written consents representing the number of votes required to authorize the proposed action have been received by the Secretary. The record date for determining Members entitled to take action without a meeting will be the date the first Member signs a written consent.

 

                        (x)       Waiver of Notice. When any notice is required to be given to any Member, a waiver thereof in writing signed by the person entitled to such notice, whether before, at or after the time stated therein, will be equivalent to the giving of such notice.

 

ARTICLE 3

CAPITAL CONTRIBUTIONS

 

3.1       CAPITAL CONTRIBUTIONS. Each Member has made or will be deemed to have made, the Capital Contributions as set forth on the Unit Register. No Member will be required to make any additional capital contributions to the Company. The Units of the Company held by the Members of the Company are as set forth opposite such Member’s name on the Unit Register. The Board will cause the Unit Register to be updated from time to time as necessary to accurately reflect the information set forth therein.

 

3.2       OTHER MATTERS.

 

            (a)       Return of Capital. Except as otherwise provided in this Agreement, no Member (i) may demand or receive a return of his, her, or its Capital Contribution or withdraw from the Company or (ii) will have any priority over other Members as to the return of its Capital Contributions. Under the circumstances requiring a return of any Capital Contribution, no Member will have the right to receive property other than TREP Tokens, except as may be specifically provided in this Agreement.

 

            (b)       Interest in Capital Contributions. Interest in Capital Contribution. Except as otherwise provided in this Agreement, no Member will receive any interest payment, salary, or draw with respect to his, her, or its Capital Contribution or Capital Account or otherwise solely in his, her, or its capacity as a Member.

 

            (c)       No Personal Liability. No Member, in their capacity as a member, will be liable for the debts, liabilities, contracts, or any other obligations of the Company. In addition, no Member will be obligated to make an additional capital contribution to the Company, whether to restore a negative Capital Account balance or otherwise, nor to lend any amounts to the Company.

 

3.3       DILUTION. No dilution of the Class A Units shall occur without the consent of the Managing Members.

 

ARTICLE 4

CAPITAL ACCOUNTS AND ALLOCATIONS

 

4.1       CAPITAL ACCOUNTS. A separate capital account (a “Capital Account”) representing each Member’s interest in the capital of the Company will be established for each Member on the books of the Company and will be maintained in the manner required by Treasury Regulations under Code Section 704(b).

 

4.2       ALLOCATION OF PROFITS AND LOSSES. Net profits and net losses shall be allocated in proportions to the interest held by each Member.

 

4.3       REGULATORY ALLOCATIONS; TAX ALLOCATIONS.

(a)       Regulatory Allocations. Notwithstanding the allocations set forth in Section 4.2, Profits, Losses, and items thereof will be allocated to the Members in the manner and to the extent required by the Treasury Regulations under Section 704 of the Code, including without limitation, the provisions thereof dealing with minimum gain chargebacks, partner minimum gain chargebacks, qualified income offsets, partnership nonrecourse deductions, partner nonrecourse deductions, the provisions dealing with deficit capital accounts in Treasury Regulations Sections 1.704-2(g)(1), 1.704-2(i)(5), and 1.704-1(b)(2)(ii)(d), and any applicable provisions dealing with Units subject to forfeiture. The Board will apply such provisions in its good faith discretion based on advice from the Company’s tax advisors.

(b)       Tax Allocations. The income, gains, losses, deductions and expenses of the Company will be allocated, for federal, state and local income tax purposes, among the Members in accordance with the allocation of such income, gains, losses, deductions and expenses among the Members for computing their Capital Accounts, except that if any such allocation is not permitted by the Code or other applicable law, the Company’s subsequent income, gains, losses, deductions and expenses will be allocated among the Members for tax purposes to the extent permitted by the Code and other applicable law, so as to reflect as nearly as possible the allocation set forth herein in computing their Capital Accounts. Notwithstanding the previous sentence, such items will be allocated among the Members in a different manner to the extent required by Code Section 704(c) and the Treasury Regulations thereunder (dealing with contributed property), Treasury Regulations Sections 1.704-1(b)(2)(iv)(f) (dealing with property having a book value different than its tax basis), and 1.704-1(b)(4)(ii) (dealing with tax credit items). Allocations pursuant to this Section 4.3(b) are solely for purposes of federal, state and local taxes and will not affect, or in any way be taken into account in computing, any Member’s Capital Account or share of profits, losses, other items or distributions pursuant to any provisions of this Agreement.

 

4.4       TRANSFER OF UNITS DURING TAXABLE YEAR. In the case of the transfer of a Member’s Units or the addition of an additional Member or issuance or redemption of Units at any time other than the end of a Taxable Year, the distributive share of the various items of income, gain, loss, deduction, credit or allowance in respect of the Units so transferred will be allocated between the transferor and the transferee to take into account the varying interests of the Members during the Taxable Year in accordance with Code Section 706, using a convention permitted by law and selected by the officers of the Company.

 

ARTICLE 5

DISTRIBUTIONS; CERTAIN TAX MATTERS

 

5.1       OPERATIONAL DISTRIBUTIONS. Distributions other than Distributions in connection with a Liquidation Event (which will be subject to Section 5.2) will be made to the Members in proportion to the relative number of Units held by each Member and shall only be made in the form of Class B Units or Class C Units

 

5.2       RESTRICTION ON DISTRIBUTION INTEREST. The Company shall pay the amount of dividends either in the form TREP Tokens or fiat currency. In the event the distribution of net profit is made in the form of TREP Tokens, such tokens shall have a transferring restriction of one (1) year from the distribution date.

 

5.3       LIQUIDATING DISTRIBUTIONS. Subject to Section 10.2(c), Distributions in connection with a Liquidation Event will be made to the holders of all outstanding Units in the manner set forth in Section 5.2. To the extent that the Company is required by law to withhold or make tax or other payments on behalf of or with respect to any Member, the Company will withhold such amounts from any Distribution and make such payments as so required. For purposes of this Agreement, any such payments or withholdings will be treated as a Distribution to the Member on behalf of whom the withholding or payment was made.

 

5.4       PREPARATION OF TAX RETURNS; TAX INFORMATION.

 

(a)       The Company will arrange for the preparation and timely filing of all returns required to be filed by the Company and will provide Schedule K-1s (and any state or local equivalents) for each year to each Member by March 1st of the following year unless otherwise extended by the Board. In the event of such extension, the Company will use reasonable best efforts to provide each Member with an estimate of the net taxable income of the Company allocated to (or reasonably estimated to be allocated to) such Member under Article 4 for a Taxable Year, together with an estimate of the state apportionment of such income, by March 1st of the following year. In addition, the Company will provide a Member with such other tax information as the Member may reasonably request from time to time as it relates to the Member’s interest in the Company.

 

(b)       Prior to the date in which each Member’s quarterly estimated tax payments are due, the Company will use reasonable best efforts to provide each Member with an estimate of the net taxable income of the Company allocated to (or reasonably estimated to be allocated to) such Member from the beginning of the Taxable Year through the end of the most recent month attributable to the items allocated to such Member under Article 4.

5.5       TAX MATTERS MEMBER; TAX ELECTIONS.              

 

            (a)       The Company hasn’t appointed a designated Tax Matters Member.

 

ARTICLE 6

BOARD OF MANAGERS

 

6.1       MANAGEMENT BY THE BOARD.

 

(a)       The Company will have a Board of Managers (the “Board”), which will initially consist of one “manager” within the meaning of the Act (each, a “Manager”). The Board may be increased or decreased at any time or from time to time by the affirmative vote of a majority of the Board. The Managers will be elected by the affirmative vote of a Majority in Interest of the Members. Any additional Managers will be nominated by a majority of the other members of the Board and elected by a Majority in Interest of the Members. The Manager will initially be Jay Patel.  Additional Managers will be added as needed in year 1 following TREP’s first three syndications.

 

(b)       Subject to the provisions of law or any limitations in the Act, the business and affairs of the Company will be managed, and all powers, including without limitation, the reacquisition, redemption, or repurchase of the Units, will be exercised, by or under the direction of the Board; provided that no single Manager will have the authority to bind the Company unless authorized to do so by the Board.

 

(c)        Except as specifically set forth in this Agreement, the Members hereby delegate all power and authority to manage the business and affairs of the Company to the Board. The Board will delegate the management of the day-to-day operation of the business of the Company to such officers as the Board determines appropriate, provided that the business and affairs of the Company will be managed and all powers will be exercised under the ultimate direction of the Board.

 

6.2       MEETING OF THE BOARD; ACTION BY THE BOARD

 

            (a)       The Board (and any committees thereof) will meet at such times and from time to time as any member of the Board may designate (but not less than quarterly), upon reasonable notice to the members of the Board, to consult with, advise and direct the officers with respect to business and affairs of the Company.

            (b)       At all meetings of the Board, a majority of the Managers then serving on the Board will constitute a quorum for the transaction of business. The act of a majority of the Board members present at any meeting at which there is a quorum will be the act of the Board. The Board may also act by unanimous written consent.

            (c)        Any resolutions of or actions taken by the Board will be binding and the officers will be bound to act in accordance with any such recommendations or actions.

6.3       COMMITTEES OF THE BOARD. The Board may designate one or more committees, which may include one or more Managers, to serve at the pleasure of the Board. Any such committee will have authority to act in the manner and to the extent provided in the resolution of the Board and may have all the authority of the Board in the management of the business and affairs of the Company.

 

6.4       RESIGNATION. A Manager may resign at any time by giving written notice to the Board or, if such Manager is the only member of the Board, to the Members. The resignation of a Manager will take effect upon receipt of notice thereof or at such later time as will be specified in such notice; unless otherwise specified therein, the acceptance of such resignation will not be necessary to make it effective.

 

6.5       REMOVAL. A Manager may be removed at any time, with or without cause, by the vote of the Majority in Interest of the Members.

 

6.6       VACANCIES. If a Manager ceases to be a Manager for any reason, a successor Manager may be appointed by the affirmative vote of the Members or group of Members entitled to elect such Manager pursuant to Section 6.1(a) of this Agreement.

 

6.7       MANAGERS’ EXCLUSIVE DUTY TO THE COMPANY. The Managers will not be required to manage the Company as their sole and exclusive function, and will be entitled to and may have business interests and may engage in other business activities in addition to those relating to the Company, and may engage in the ownership, operation, and management of businesses and activities for their own account and for the account of others, without having or incurring an obligation to offer any interest in such properties, businesses or activities to the Company or any other Member, and no other provision of this Agreement will be deemed to prohibit any Manager from conducting such other businesses or activities.

 

6.8       ADDITIONAL CAPITAL. After the date of this Agreement, the Company will not raise additional capital without the approval of the Board. No Member will be required to make any additional contribution to the Company’s capital.

 

ARTICLE 7

OFFICERS

 

7.1       APPOINTMENT OF OFFICERS. The Board may appoint officers of the Company which may include, but will not be limited to: (a) Chairman; (b) Chief Executive Officer; (c) Managing Partner; (d) President; (e) Chief Financial Officer; (f) one or more Vice Presidents and (g) Secretary. Any number of offices may be held by the same person. The Board may delegate day-to-day management responsibilities to any such officers, and such officers will have the authority to contract for, negotiate on behalf of and otherwise represent the interests of the Company.

7.2       TENURE AND DUTIES OF OFFICERS. The officers will hold their respective offices at the pleasure of the Board and until their successors have been duly elected and qualified, unless sooner removed. If the office of one of the officers becomes vacant for any reason, the vacancy may be filled by the Board. The officers will have such titles and powers and perform such duties as determined from time to time by the Board and otherwise as customarily pertains to such offices.

 

(a)       Duties of Chairman of the Board. The Chairman of the Board, when present, shall preside at all meetings of the Members and the Board. The Chairman of the Board shall perform other duties commonly incident to the office and shall also perform such other duties and have such other powers as the Board shall designate from time to time. If there is no Chief Executive Officer and no President, then the Chairman shall also serve as the Chief Executive Officer of the Company and shall have the powers and duties prescribed in paragraph (b) of this Section.

 

(b)       Duties of Chief Executive Officer. The Chief Executive Officer shall preside at all meetings of the Members and (if a Manager) at all meetings of the Board, unless the Chairman of the Board has been appointed and is present. The Chief Executive Officer shall be the chief executive officer of the Company and shall, subject to the control of the Board, have general supervision, direction, and control of the business and affairs of the Company. The Chief Executive Officer shall perform other duties commonly incident to the office and shall also perform such other duties and have such other powers as the Board shall designate from time to time.

 

(c)       Duties of Managing Partner. The Managing Partner shall preside at all meetings of the Members and (if a Manager) at all meetings of the Board, unless the Chairman of the Board has been appointed and is present or the Chief Executive Officer is otherwise present. The Managing Partner shall be the managing partner of the Company and shall, subject to the control of the Board, have general supervision, direction, and control of the business and affairs of the Company. The Managing Partner shall perform other duties commonly incident to the office and shall also perform such other duties and have such other powers as the Board shall designate from time to time.

 

(d)       Duties of President. In the absence or disability of the Chief Executive Officer or if the office of Chief Executive Officer is vacant, the President shall preside at all meetings of the Member and (if a Manager) at all meetings of the Board, unless the Chairman of the Board has been appointed and is present. If the office of the Chief Executive Officer is vacant, the President shall be the chief executive officer of the Company and shall, subject to the control of the Board, have general supervision, direction, and control of the business and affairs of the Company. The President shall perform other duties commonly incident to a president of a Wyoming corporation and shall also perform such other duties and have such other powers as the Board shall designate from time to time.

 

(e)       Duties of Chief Financial Officer. The Chief Financial Officer will keep or cause to be kept the books of account of the Company in a thorough and proper manner and will render statements of the financial affairs of the Company in such form and as often as required by this Agreement or the Board. The Chief Financial Officer, subject to the order of the Board, will have the custody of all funds and securities of the Company. The Chief Financial Officer will perform other duties commonly incident to the office of Chief Financial Officer or Treasurer in a Wyoming corporation and will also perform such other duties and have such other powers as the Board, or the Chief Executive Officer may designate from time to time. The Chief Executive Officer or President may direct an Assistant Treasurer or Controller to assume and perform the duties of the Chief Financial Officer in the absence or disability of the Chief Financial Officer, and each Assistant Treasurer or Controller will perform other duties commonly incident to the office the Chief Financial Officer or Treasurer of a Wyoming corporation and will also perform such other duties and have such other powers as the Board or the Chief Executive Officer may designate from time to time.

 

(f)        Duties of Vice Presidents. The Vice Presidents, in the order of their seniority (if specified), may assume and perform the duties of the President in the absence or disability of the President or whenever the office of President is vacant. The Vice Presidents will perform other duties commonly incident to a vice president of a Wyoming corporation and will also perform such other duties and have such other powers as the Board, or the Chief Executive Officer will designate from time to time.

 

 (g)      Duties of Secretary. The Secretary will attend all meetings of the Members and Managers, and will record all acts and proceedings thereof in the minute book of the Company. The Secretary will give notice in conformity with this Agreement of all meetings of the Members requiring notice. The Secretary will perform all other duties given them in this Agreement and other duties commonly incident to a secretary of a Wyoming corporation and will also perform such other duties and have such other powers as the Board will designate from time to time. The President may direct any Assistant Secretary to assume and perform the duties of the Secretary in the absence or disability of the Secretary, and each Assistant Secretary will perform other duties commonly incident to the office of assistant secretary in a Wyoming corporation and will also perform such other duties and have such other powers as the Board or the Chief Executive Officer will designate from time to time.

 

ARTICLE 8

CERTAIN MATTERS CONCERNING

MEMBERS, MANAGERS AND OFFICERS

 

8.1       LIABILITY OF MEMBERS, MANAGERS AND OFFICERS; INDEMNIFICATION.

 

(a)       No Member, Manager, or officer of the Company will be liable, in damages or otherwise, to the Company or any Member for any act or omission performed or omitted to be performed by it in good faith (except for intentional misconduct or recklessness) pursuant to the authority granted to such Member, Manager or officer of the Company by this Agreement or by the Act.

 

(b)       To the fullest extent permitted by the laws of Wyoming, the Company will indemnify and hold harmless each Manager and their respective officers, directors, shareholders, members or partners and each officer of the Company (each, an “Indemnitee”), from and against any and all losses, claims, demands, costs, damages, liabilities (joint or several), expenses of any nature (including reasonable attorneys’ fees and disbursements), judgments, fines, settlements and other amounts (“Damages”) arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, in which an Indemnitee may be involved, or threatened to be involved, as a party or otherwise, arising out of or incidental to the business of the Company and such Person’s status as an Indemnitee, regardless of whether an Indemnitee continues to be a Manager or an officer, director, shareholder, member or partner of such Manager or an officer of the Company at the time any such liability or expense is paid or incurred, except for any Damages based upon, arising from or in connection with any act or omission of an Indemnitee committed without authority granted pursuant to this Agreement or in bad faith or otherwise constituting recklessness or willful misconduct.

 

(c)        Expenses (including reasonable attorneys’ fees and disbursements) incurred in defending any claim, demand, action, suit or proceeding, whether civil, criminal, administrative or investigative, subject to Section 8.1(b) hereof, will be paid (or caused to be paid) by the Company in advance of the final disposition of such claim, demand, action, suit or proceeding upon receipt of an undertaking by or on behalf of the Indemnitee to repay such amount if it will ultimately be determined, by a court of competent jurisdiction from which no further appeal may be taken or the time for any appeal has lapsed (or otherwise, as the case may be), that the Indemnitee is not entitled to be indemnified by the Company as authorized hereunder or is not entitled to such expense reimbursement.

 

(d)       The indemnification provided by Section 8.1(b) hereof will be in addition to any other rights to which an Indemnitee may be entitled under any agreement or vote of the Members, as a matter of law or otherwise, both (i) as to action in the Indemnitee’s capacity as a Manager or as an officer, director, shareholder, member or partner of a Manager or as an officer of the Company, and (ii) as to action in another capacity, and will continue as to an Indemnitee who has ceased to serve in such capacity and will inure to the benefit of the heirs, successors, assigns, administrators and personal representatives of the Indemnitee.

 

(e)       Any indemnification hereunder will be satisfied only out of the assets of the Company, and the Members will not be subject to personal liability by reason of these indemnification provisions.

 

(f)        The Company may purchase and maintain insurance on behalf of one or more Indemnitees and other Persons against any liability which may be asserted against, or expense which may be incurred by, any such Person in connection with the Company’s activities, whether or not the Company would have the power to indemnify such Person against such liability under the provisions of this Agreement.

 

(g)       An Indemnitee will not be denied indemnification in whole or in part under this Section 8.1 because the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.

 

(h)       The provisions of this Section 8.1 are for the benefit of each Indemnitee and its heirs, successors, assigns, administrators, and personal representatives and will not be deemed to create any rights for the benefit of any other Persons.

 

8.2       OTHER MATTERS CONCERNING THE MEMBERS, MANAGERS AND OFFICERS OF THE COMPANY.

 

(a)       Each Member, Manager, and officer of the Company may rely on and will be protected in acting or refraining from acting upon, any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture or other paper or document reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties.

 

(b)       For purposes of this Agreement, each Member, Manager, and officer of the Company may consult with legal counsel, accountants, appraisers, management consultants, investment bankers, other consultants and advisers reasonably selected by it and any written advice or written opinion of any such Person as to matters which such Member, Manager and officer of the Company reasonably believe to be within such Person’s professional or expert competence, and any act or omission, if done or omitted to be done in good faith reliance upon any such advice or opinion, will be conclusively presumed not to constitute fraud or willful or reckless misconduct.

 

ARTICLE 9

TRANSFERS OF UNITS; ADMISSION OF MEMBERS; CERTAIN REINCORPORATION MATTERS

 

9.1       TRANSFER RESTRICTIONS.

 

(a)       Prohibited Transfers. Each Member will not, whether voluntarily or by operation of law, Transfer any Units, within one (1) year of purchase from the Company (the “Restricted Units”), except for “Permitted Transfers” (as defined in Section 9.1(b) below).

 

(b)       For purposes of this Section 9.1, a “Permitted Transfer” will mean:

 

(i)         After the one-year holding period prior to the resale of Units and in compliance with the applicable security laws;

 

(ii)        Any repurchase of Units by the Company, including pursuant to a right of repurchase upon the termination of the transferring Member’s employment, Manager or consulting relationship with the Company;

(iii)       Any Transfer to the transferring Member’s ancestor, descendant, sibling or spouse or a trust for their or a Member’s benefit or to another entity (including, but not limited to, a corporation, limited liability company or partnership) that is owned entirely by the transferring Member or his or her ancestors, descendants, siblings or spouse; or

(iv)       Any Transfer by a Member that is an entity to an Affiliate of such Member; or any distribution of securities made without monetary consideration to the owners or retired owners of a transferring Member that is a partnership, limited liability company, or corporation.

(v)        Provided, in each case, that the pledgee, transferee or donee (each a “Permitted Transferee”) will furnish the Company with a written agreement to be bound by and comply with all provisions of this Agreement and entitling such person to all applicable rights under this Agreement.

(c)       Contravention of Agreement. Any purported Transfer of a Unit that is in contravention of this Agreement or that would cause the Company to not be treated as a partnership for U.S. federal income tax purposes will be null and void and of no effect whatsoever; provided, however, that, if the Company is required to recognize a Transfer that is in contravention of this Agreement or that would cause the Company to not be treated as a partnership for U.S. federal income tax purposes, (i) the Units so Transferred will be strictly limited to the transferor’s rights to allocations and Distributions as provided by this Agreement with respect to the Transferred Units, which allocations and Distributions may be applied (without limiting any other legal or equitable rights of the Company) to satisfy any debts, obligations or liabilities for damages that the transferor or transferee of such Units may have to the Company or (ii) neither the transferee nor the transferor will have any rights as to the management of the Company with respect to such Transferred or purportedly Transferred Units.

(d)       Indemnification Obligations of Transferor. In the case of a Transfer or attempted Transfer of a Unit that is in contravention of this Agreement or that would cause the Company to not be treated as a partnership for U.S. federal income tax purposes, the parties engaging or attempting to engage in such Transfer will be liable to indemnify and hold harmless the Company and the other Members from all costs, liability and damage that any of such indemnified Persons may incur (including, without limitation, incremental tax liability and attorneys’ fees and expenses) as a result of such Transfer or attempted Transfer and efforts to enforce the indemnity granted hereby.

9.2       CONDITIONS TO TRANSFERS. A Transfer of a Unit that otherwise qualifies under this Agreement will not be given effect by the Company unless and until the following conditions are satisfied:

(a)       Documentation. The transferor and transferee will execute and deliver to the Company such documents and instruments of conveyance as may be necessary for the reasonable opinion of counsel to the Company (including, without limitation, a counterpart signature page to this Agreement) to effect such Transfer and to confirm the agreement of the transferee to be bound by the provisions of this Agreement.

 

(b)       Required Information. The transferor and transferee will furnish the Company with the transferee’s taxpayer identification number, sufficient information to determine the transferee’s initial tax basis in the Units transferred, and any other information necessary to permit the Company to file all required federal and state tax returns and other legally required information statements or returns. Without limiting the generality of the foregoing, the Company will not be required to make any Distribution otherwise provided for in this Agreement with respect to any Transferred Units until it has received such information.

(c)       Compliance with Securities Laws. Either (i) such Units will be registered under the Securities Act, and any applicable state securities laws, or (ii) the transferor will provide, upon the Company’s reasonable request, an opinion of counsel, which opinion and counsel will be reasonably satisfactory to the Company, to the effect that such transfer will be exempt from all applicable registration requirements and that such Transfer will not violate any applicable laws regulating the transfer of securities.

(d)       Substitute Member. The transferor may grant to any transferee of Units permitted hereunder the right to become a Substitute Member, with respect to the Units transferred; provided, however, that such transferee (other than a transferee pursuant to Section 9.1(b)) will not become a Substitute Member unless and until the admission of such transferee is consented to in writing by a Majority in Interest of the Members (excluding the transferor), which consent will not be unreasonably withheld. Any transferee of a Unit or Units will become an assignee with respect to such Unit or Units unless and until such transferee is admitted as a Substitute Member pursuant to the prior sentence of this Section 9.2(d). Such an assignee will only be entitled to the transferor’s interest in Profits, Losses, Distribution, Capital Account, and liquidation proceeds, but will not have any other rights of a Member, including, without limitation, the right to vote on any Company matters.

(e)       Expenses. Each Member Transferring Units pursuant to this Section 9.2 will pay its pro-rata share of the expenses incurred by the Members in connection with such Transfer.

 

9.3       EFFECT OF TRANSFERS.

 

(a)       Allocation of Profits and Losses. If any Unit is Transferred during any accounting period in compliance with the provisions of this Article 9, Profits, Losses, each item thereof, and all other items attributable to the Transferred Unit for such period will be divided and allocated between the transferor and the transferee by taking into account their varying interests during the period in accordance with Code Section 706(d), using any conventions permitted by law and selected by the Company in its reasonable discretion. All Distributions on or before the date of such transfer will be made to the transferor, and all Distributions thereafter will be made to the transferee. Solely for purposes of making such allocations and Distributions, the Company will, if otherwise in compliance with this Agreement, recognize such Transfer not later than the end of the calendar month during which it is given notice of such Transfer, provided that if the Company does not receive a notice stating the date such Unit was Transferred and such other information as the Company may reasonably require within 30 days after the end of the accounting period during which the Transfer occurs, then all of such items will be allocated, and all Distributions will be made, to the Member who, according to the books and records of the Company, on the last day of the accounting period during which the Transfer occurs, was the owner of the Unit. Neither the Company nor any Member will incur any liability for making allocations and Distributions in accordance with the provisions of this Section 9.3(a), whether or not the Company has knowledge of any Transfer of ownership of any Unit.

(b)       Existing Terms and Conditions. Any Person who acquires in any manner whatsoever any Units or other interest in the Company, irrespective of whether such Person has accepted and adopted in writing the terms and provisions of this Agreement, will be deemed by the acceptance of the benefits of the acquisition thereof to have agreed to be subject to and bound by all of the terms and conditions of this Agreement that any predecessor in such Units or other interest in the Company of such Person was subject to or by which such predecessor was bound.

(c)       Termination of Member Status. Any Member who will Transfer any Units or other interest in the Company will cease to be a Member of the Company with respect to such Units or other interest and will no longer have any rights or privileges of a Member with respect to such Units or other interest.

 

9.4       ADMISSION OF MEMBERS.

 

(a)       Substitute Members. In connection with the Transfer of Units permitted under the terms of this Agreement, the transferee of such Units will become a Substitute Member on the later of (i) the effective date of such Transfer and (ii) the date on which such transferee is approved as a Substitute Member pursuant to Section 9.2(d) of this Agreement, and such admission will be shown on the books and records of the Company.

 

(b)       Additional Members. A Person may be admitted to the Company as an Additional Member only as permitted under this Article 9 and then only upon furnishing to the Company (i) a letter of acceptance, in a form satisfactory to the Company, of all the terms and conditions of this Agreement and (ii) such other documents or instruments as may be necessary or appropriate to effect such Person’s admission as a Member. Such admission will become effective on the date on which the Company determines in its sole discretion that such conditions have been satisfied and when any such admission is shown on the books and records of the Company.

 

9.5       REPRESENTATIONS; LEGEND. Each Member hereby agrees that the following legend may be placed upon any counterpart of this Agreement or any other document or instrument evidencing ownership of a Unit:

 

THE UNITS REPRESENTED BY THIS DOCUMENT HAVE NOT BEEN REGISTERED UNDER ANY SECURITIES LAWS, AND THE TRANSFERABILITY OF SUCH UNITS IS RESTRICTED PURSUANT TO THE TERMS AND CONDITIONS OF THE COMPANY’S OPERATING AGREEMENT, AS MAY BE AMENDED FROM TIME TO TIME.

 

A UNIT MAY NOT BE SOLD, ASSIGNED, OR TRANSFERRED, NOR WILL ANY ASSIGNEE, VENDEE, TRANSFEREE, OR ENDORSEE THEREOF BE RECOGNIZED AS HAVING ACQUIRED ANY SUCH UNIT BY THE ISSUER FOR ANY PURPOSES, UNLESS (1) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT WITH RESPECT TO SUCH UNIT WILL THEN BE IN EFFECT AND SUCH TRANSFER HAS BEEN QUALIFIED TO THE EXTENT REQUIRED UNDER ANY APPLICABLE STATE SECURITIES LAWS, OR (2) AN EXEMPTION FROM SUCH REGISTRATION AND QUALIFICATION WILL BE AVAILABLE.

ARTICLE 10

SALE OR LIQUIDATION OF THE COMPANY

 

10.1    LIQUIDATION EVENTS. The Company will dissolve, terminate, and commence winding up and liquidation upon the first to occur of any of the following (each, a “Liquidation Event’):

 

(a)       Sale of the Company. A Sale of the Company;

 

(b)       Member Election. A decision of a Majority in Interest of the Members to dissolve, wind up, and liquidate the Company; or

 

(c)       Other. The happening of any other event that makes it unlawful or impossible to carry on the business of the Company.

 

Notwithstanding anything to the contrary in this Agreement, in the case of a sale of the Company pursuant to clause (ii) of the definition thereof, (x) the Company will not dissolve, terminate or commence winding up and liquidation unless the Majority in Interest of the Members elect to do so, and (y) distributions will be in accordance with Section 10.2(c) and not clauses (a) and (b) of Section 10.2. The Members hereby agree that, notwithstanding any provision of the Act, the Company will not dissolve prior to the occurrence of a Liquidation Event.

 

10.2    WINDING UP. Upon the occurrence of a Liquidation Event, the Company will continue solely for the purposes of winding up its affairs in an orderly manner, liquidating its assets, and satisfying the claims of its creditors and Members. No Member will take any action that is inconsistent with, or not necessary to or appropriate for, the winding up of the Company’s business and affairs. The Company’s assets will be liquidated as promptly as is consistent with obtaining the fair market value thereof, and the proceeds therefrom, to the extent legally available and sufficient, therefore, will be applied and distributed in the following order and priority:

 

(a)       Company Creditors. First, to the payment and discharge of all of the Company’s debts and liabilities to creditors other than Members;

 

(b)       Member Creditors. Second, to the payment and discharge of all of the Company’s debts and liabilities to Members;

 

(c)       Member Equity. Thereafter, to the Members in accordance with Section 5.2.

 

Any distribution to a Member pursuant to Sections 10.2(b) and 10.2(c) above will be net of any amounts owed to the Company by such Member. No Member will receive any additional compensation for any services performed pursuant to this Article 10.

 

10.3    DEFICIT CAPITAL ACCOUNT; DELAYED DISTRIBUTIONS.

 

If any Member has a deficit balance in his, her, or its Capital Account (after giving effect to all contributions, distributions, and allocations for all Taxable Years, including the year during which such liquidation occurs), such Member will have no obligation to make any contribution to the capital of the Company with respect to such deficit, and such deficit will not be considered a debt owed to the Company or any other person for any purpose whatsoever. In the discretion of the Members, a pro-rata portion of the Distributions that would otherwise be made to the Members pursuant to Section 10.2(c) may be:

 

(a)       distributed to a trust established for the benefit of the Members for the purposes of liquidating Company assets, collecting amounts owed to the Company, and paying any contingent or unforeseen liabilities or obligations of the Company or of the Members arising out of or in connection with the Company. The assets of any such trust will be distributed to the Members from time to time, in the discretion of the Members, in the same proportion as the amount distributed to such trust by the Company would otherwise have been distributed to the Members pursuant to this Agreement; or

 

(b)       withheld to provide a reserve for Company liabilities (contingent or otherwise) and to reflect the unrealized portion of any installment obligations owed to the Company, provided that such withheld amounts will be distributed to the Members as soon as reasonably practicable.

 

10.4    RIGHTS OF MEMBERS. Except as otherwise provided in this Agreement, (a) each Member will look solely to the assets of the Company for the return of its Capital Contribution and will have no right or power to demand or receive property other than TREP Tokens from the Company, and (b) no Member will have priority over any other Member as to the return of its Capital Contribution, distributions or allocations.

 

10.5    PROHIBITION ON WITHDRAWAL. No Member is entitled to withdraw from the Company prior to the Company’s dissolution pursuant to this Article 10. Under no circumstances, other than pursuant to the express terms of this Agreement, will the Company be required to make any Distribution prior to the Company’s dissolution pursuant to this Article 10.

 

ARTICLE 11

AMENDMENTS; WAIVERS

 

11.1    ENTIRE AGREEMENT. This Agreement, together with the documents incorporated by reference as provided in Section 12.7, constitutes the entire agreement among the Members with respect to the affairs of the Company and the conduct of its business and supersedes all prior agreements and understandings, whether oral or written (including without limitation, the Original Operating Agreement). The Company will have no oral operating agreements. This Agreement may only be amended as provided in Section 11.2, and any amendment adopted in accordance with Section 11.2 will be binding on all Members without the necessity of their execution of the amendment or any other instrument.

 

ARTICLE 12

MISCELLANEOUS

 

12.1    NOTICES. All notices, requests, demands, and other communications under this Agreement must be in writing and will be deemed duly given, unless otherwise expressly indicated to the contrary in this Agreement, (a) when personally delivered, (b) two Business Days after having been deposited in the United States mail, certified or registered, return receipt requested, postage prepaid, (c) one Business Day after having been dispatched by a nationally recognized overnight courier service, addressed to the parties or their permitted assigns with an acknowledgment of receipt requested at the following addresses, or (d) upon electronic mail transmission:

(a)       Company. If to the Company, to the Company at the address set forth in Section 1.4 hereof,

(b)       Member. If to a Member, to the address set forth on the Unit Register. Any Person may from time to time specify a different address by written notice to the Company.

12.2    BINDING EFFECT. Except as otherwise provided in this Agreement, every covenant, term, and provision of this Agreement will be binding upon and inure to the benefit of the Members and their respective legal representatives, successors, transferees, and permitted assigns.

 

12.3    DERIVATIVE ACTIONS. Except to the extent required by the Act, no Member will have the right to bring an action in the right of the Company to recover a judgment in its favor if the Board has refused to bring such action.

 

12.4    CONSTRUCTION. Every covenant, term, and provision of this Agreement will be construed simply according to its fair meaning and not strictly for or against any Member.

12.5    HEADINGS. Section and other headings contained in this Agreement are for reference purposes only and are not intended to describe, interpret, define or limit the scope or extent of this Agreement or any provision hereof.

12.6    SEVERABILITY. Every provision of this Agreement is intended to be severable. If any term or provision hereof is invalid for any reason whatsoever, such illegality or invalidity will not affect the validity or legality of the remainder of this Agreement.

12.7    INCORPORATION BY REFERENCE. Every exhibit attached to this Agreement and referred to herein is hereby incorporated into this Agreement by reference.

 

12.8    FURTHER ACTION. Each Member agrees to perform all further acts and execute, acknowledge, and deliver any documents that may be reasonably necessary, appropriate, or desirable to carry out the provisions of this Agreement.

12.9    VARIATION OF PRONOUNS. All pronouns and any variations will be deemed to refer to masculine, feminine, or neuter, singular or plural, as the identity of the Person or Persons may require.

12.10  GOVERNING LAW. State of Wyoming will govern the validity of this Agreement, the construction of its terms and the interpretation of the rights and duties of the Members provided that any Member who is also an employee or other service provider of the Company will be subject to the applicable law relating to such employment or service relationship.

12.11  SPECIFIC PERFORMANCE. The parties hereto acknowledge that it is impossible to measure, in money, the damages that will accrue to a party or to the personal representative of a decedent from a failure of a party to perform any of the obligations under this Agreement. Therefore, if any party hereto or the personal representative or executor of any party hereto enters into any action or proceeding to enforce the provisions of this Agreement, any Person (including the Company) against whom the action or proceeding is brought waives the claim or defense that the moving party or representative has or will have an adequate remedy at law, and the Person will not urge in action or proceeding the claim or defense that an adequate remedy at law exists.

12.12  CONFIDENTIALITY. Each Member agrees to use the same degree of care as such Member uses to protect its own confidential information to keep confidential any information furnished to such Member identifies as being confidential or proprietary (so long as such information is not in the public domain), except that such Member may disclose such proprietary or confidential information (i) to any partner, subsidiary or parent of such Member as long as such partner, subsidiary or parent is advised of and agrees or has agreed to be bound by the confidentiality provisions of this Section 12.12 or comparable restrictions; (ii) at such time as it enters the public domain through no fault of such Member; (iii) that is communicated to it free of any obligation of confidentiality; (iv) that is developed by such Member or its agents independently of and without reference to any confidential information communicated by the Company; or (v) as required by applicable law.

12.13  COUNTERPART EXECUTION. This Agreement may be executed in any number of counterparts (including by means of facsimile signature pages) with the same effect as if all of the Members had signed the same document. All counterparts will be construed together and will constitute one agreement.

ARTICLE 13

DEFINITIONS

 

13.1    Definitions. As used in this Agreement, the following definitions will apply to the capitalized terms indicated below:

 

(a)       “Accounting Period” means unless otherwise determined by the Board, (i) the Company’s Taxable Year if there are no changes in the Members’ respective interests in Company income, gain, loss or deductions during such Taxable Year except on the first day thereof or (ii) any other period beginning on the first day of a Taxable Year, or any other day during a Taxable Year, upon which occurs a change in such respective interests, and ending on the last day of a Taxable Year, or on the day preceding an earlier day upon which any change in such respective interest will occur.

 

(b)       “Act” means the Wyoming Limited Liability Company Act, as may be amended from time to time.

 

(c)        “Additional Member” means a Person admitted to the Company as a Member pursuant to Section 9.4(b).

 

(d)       “Adjusted Asset Value” with respect to any asset will be the asset’s adjusted basis for federal income tax purposes, except as follows:

 

(i)         The initial Adjusted Asset Value of any asset contributed by a Member to the Company will be the gross fair market value of such asset at the time of contribution, as determined by the contributing Member and the Board;

 

(ii)        The Adjusted Asset Values of all Company assets will be adjusted to equal their respective gross fair market values, as determined by the Board (taking Code Section 7701(g) into account), and the resulting unrecognized profit or loss allocated to the Capital Accounts of the Members pursuant to Article 4, as of the following times: (i) the grant or acquisition of an additional interest in the Company to or by any new or existing Member; (ii) the distribution by the Company to a Member of more than a de minimis amount of Company assets unless all Members receive simultaneous distributions of either undivided interests in the distributed property or identical Company assets in proportion to their interests in Company distributions; (iii) the termination of the Company either by expiration of the Company’s term or the occurrence of an event of early termination; and (iv) the liquidation of the Company within the meaning of Treasury Regulation §1.704-1(b)(2)(ii)(g).

 

(iii)       The Adjusted Asset Values of the Company assets will be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m).

 

(e)       “Adjusted Capital Account” means, with respect to any Member, the Member’s Capital Account as adjusted by the items described in Sections 1.704-2(g)(1), 1.704-2(i)(5), and 1.704-1(b)(2)(ii)(d)(4), (5) and (6) of the Treasury Regulations.

 

(f)        “Affiliate” will mean, with respect to any Person, (i) any Person which beneficially holds, directly or indirectly, or otherwise controls, 10% or more of such Person’s outstanding securities, (ii) any Person, 10% or more of which Person’s outstanding securities are beneficially held, directly or indirectly, or are otherwise controlled, by such a Person and (iii) any Person, 10% or more of which Person’s outstanding securities are beneficially held, directly or indirectly, or are otherwise controlled, by a person described in (i) above.

 

(g)       “Business Day” means any day other than a Saturday or a Sunday on which trading occurs on the New York Stock Exchange.

 

(h)       “Capital Contributions” means the amount of money and the fair market value of any property contributed to the Company by a Member whenever made net of any liability of such Member assumed by the Company and any liability secured by property contributed by such Member.

 

Any reference to a capital contribution of a Member will include the Capital Contribution made by a predecessor holder of any Units held by such Member with respect to such Units.

 

(i)         “Class A Unit” means the Class A Units of the Company, each of which shall have the rights, powers, and preferences set forth in this Agreement including, without limitation, rights to (i) vote on various Company matters as expressly set forth in this Agreement and (ii) receive Distributions (liquidating or otherwise) and allocations of Profits and Losses.

 

(j)         “Class B Unit” means the Class B Units of the Company, each of which shall have the rights, powers, and preferences set forth in this Agreement including, without limitation, rights to receive Distributions (liquidating or otherwise) and allocations of Profits and Losses but no rights to vote on Company matters.

 

(k)        “Class C Unit” means the Class C Units of the Company, each of which shall have the rights, powers, and preferences set forth in this Agreement including, without limitation, rights to receive Distributions (liquidating or otherwise) and allocations of Profits and Losses but no rights to vote on Company matters.

 

(l)        “Code” means the Internal Revenue Code of 1986, as amended.

 

(m)      “Common Member” means any holder of a Class A Unit, Class B Unit, or Class C Unit, as identified on Exhibit A.

 

(n)       “Company” means TREP LLC, a Wyoming limited liability company and any of its successors or assigns.

 

(o)       ”Conversion” means any merger, reorganization, conversion, exchange,  reincorporation of the Company (however effected) pursuant to which the Company’s Equity Securities are converted into or exchanged for equity interests of an entity that is taxed as a corporation for U.S. federal income tax purposes.

 

(p)       “Convertible Securities” means any obligations, evidence of indebtedness or other securities or interests (other than options) directly or indirectly convertible or exchangeable into Units or other Equity Securities in the Company.

 

(q)       “Distribution” means each distribution made by the Company to a Member, whether in cash, property or securities of the Company and whether by liquidating distribution, redemption, repurchase or otherwise; provided, however, that any recapitalization or exchange of Equity Securities of the Company, and any subdivision (by equity split or otherwise) or any combination (by reverse equity split or otherwise) of any outstanding Membership Interests will not be a Distribution.

 

(r)        “Equity Security” means (i) Units or other equity interests in the Company (including other classes or groups thereof having such relative rights, powers and duties as may from time to time be established by the Board, including rights, powers and/or duties pari passu or senior to existing classes and groups of Units and other equity interests of the Company), (ii) stock appreciation rights, phantom stock rights or other rights with equity features, (iii) Convertible Securities and (iv) options.

 

(s)        “Majority in Interest of the Members” means the Members hold a majority of all Class A Units.

 

(t)         “Members” means the Common Members, any Substitute Members, and any Additional Members.

 

(u)       “Officers” means those individuals appointed as officers of the Company in accordance with Section 7.1.

 

(v)        “Percentage Interest” will mean the ratio of the number of Units held by the Person or Persons for whom the Percentage Interest is calculated divided by the total number of outstanding Units.

 

(w)       “Person” means any individual, partnership, corporation, trust, limited liability company, or other entity.

 

(x)        “Profits” and “Losses” means for each Taxable Year or other period an amount equal to the Company’s taxable income or loss for such year or period, determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Code Section 703(a)(1) will be included in taxable income or loss), with the following adjustments:

 

(i)         any income of the Company that is exempt from federal income tax will be added to such taxable income or loss;

 

(ii)        any expenditures of the Company not deductible in computing its taxable income and not properly chargeable to capital account (as described in and within the meaning of Code Section 705 (a)(2)(B)) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(i) will be subtracted from such taxable income or loss;

 

(iii)       if Company property is reflected on the Company’s books at other than its adjusted tax basis, then in lieu of depreciation, amortization, and other cost recovery deductions taken into account for federal income tax purposes, there will be taken into account depreciation for such year or other period, computed in accordance with the Treasury Regulations issued pursuant to Code Section 704(b);

 

(iv)       for purposes of determining Profit or Loss upon the sale or other disposition of Company property, then in accordance with the Treasury Regulations under Code Section 704(b), the value of an asset properly reflected on the Company’s books at the time of sale or other disposition will be substituted for the property’s adjusted tax basis if at the time of sale or disposition there is a variance in such value and adjusted tax basis.

 

(y)        Except as may be otherwise provided in this Agreement, all items that are components of Profits and Losses will be divided among the Members in the same ratio as they share Profits and Losses.

 

(z)        “Reincorporation” means a transaction, approved by the Board, which is not a Sale of the Company, in which there is a Conversion of the Company into a corporation (by conversion, merger with a blocker corporation or newly formed holding company or otherwise) or another form of business entity at any time (the “Successor Corporation”), pursuant to which (i) the terms and conditions contained herein will be, as closely as possible, adopted by the Successor Corporation, and (ii) each outstanding Unit will be exchanged for a share or shares of the Successor Corporation’s capital stock reflecting, as nearly as possible, such Unit’s economic and other rights under this Agreement, but in the form appropriate for a corporation, and with such commercially reasonable modifications as may be necessary to permit such conversion to be effected on a tax-free basis. At the request of the Board, all Members will execute and deliver any agreement, instrument, or other documents reasonably required to consummate such conversion.

 

(aa)     “Sale of the Company” means either (i) the sale, lease, transfer, conveyance or other disposition, in one or a syndication of related transactions, of all or substantially all of the business or assets of the Company or (ii) a transaction or series of transactions (including by way of merger, consolidation, recapitalization, reorganization or sale of stock), the result of which is that the Members immediately prior to such transaction are, after giving effect to such transaction, no longer, in the aggregate, the “beneficial owners” (as such term is defined in Rule 13d-3 and Rule 13d-5 promulgated under the Securities Exchange Act of 1934, as amended), directly or indirectly through one or more intermediaries, of more than 50% of the voting power of the outstanding Voting Securities of the surviving entity of such transaction; provided, however, in no event will an equity financing transaction for capital raising purposes in which the Company is the surviving corporation be deemed to be a Sale of the Company.

 

(bb)     “Securities Act” means the Securities Act of 1933, as amended from time to time.

 

(cc)      “Substitute Member” means an assignee who has been admitted to all of the rights of membership pursuant to this Agreement.

 

(dd)     “Tax Matters Member” has the meaning given to “tax matters partner” in Section 6231 of the Code.

 

(ee)     “Taxable Year” will mean the taxable year of the Company for federal income tax purposes.

 

(ff)       “Transfer” (whether or not such term is capitalized) means any sale, transfer, assignment, pledge, mortgage, exchange, hypothecation, grant of a security interest or other direct or indirect disposition, or encumbrance, whether with or without consideration, whether voluntarily or involuntarily and whether by operation of law or otherwise. The terms “Transferee,” “Transferred,” “Transferor,” and other forms of the word “Transfer” will have correlative meanings.

 

(gg)     “Treasury Regulations” means the United States Treasury Regulations promulgated under the Code, and any reference to any section of the Treasury Regulations will include any final or temporary revision or successor to that section.

 

(hh)     “Unit” means a unit of ownership interest in the Company, including the Class A Units, Class B Units, and Class C Units. The Units can be represented in digital tokens, which are digital representations using cryptography, in the form of a crypto asset token.

 

(ii)        “Unit Register” will mean the register that lists each Member’s Units in the Company, which will be maintained by the Company.

 

(jj)        “Voting Securities” means securities entitled to vote generally in matters affecting the issues of such securities or the issuer thereof.

 

IN WITNESS WHEREOF, the undersigned parties have executed this TREP LLC Operating Agreement as an instrument under seal as of the date first above written.

 

MEMBER(S):

 

TREP LLC

 

By:

_____________________________

Jay Patel

Chief Executive Officer

 

 

 

 

 

By:

___________________________

Name of Member:

Holder of ____ Class __ Units

Address:

SUBSCRIPTION AGREEMENT

 

TREP, LLC

1309 Coffeen Avenue, STE 1200

Sheridan, Wyoming 82801

 

1.         Subscription. 

 

            (a)       The undersigned (“Subscriber”) hereby irrevocably subscribes for and agrees to purchase TREP tokens (the “Tokens” or “Securities”), of TREP, LLC, a Wyoming limited liability company (the “Company”), at a purchase price of $1.00 per Token (the “Per Security Price”). The minimum subscription is $50,000, or 50,000 Tokens for Accredited Investors (as defined in Rule 501 under Regulation D promulgated under the Securities Act), or $1,000 or 1,000 Tokens in transactions outside the United States to persons who are not “U.S Persons” (as defined in Regulation S under the Securities Act) pursuant to Regulation S under the Securities Act. 

 

            (b)       Subscribers understand that the Securities are being offered pursuant to a private placement memorandum dated March 1, 2022 (the “Memorandum”), and have not been, and will not be, registered under the Securities Act. By executing this Subscription Agreement, Subscriber acknowledges that Subscriber has received this Subscription Agreement, copy of the Memorandum including exhibits thereto and any other information required by the Subscriber to make an investment decision. 

 

            (c)        Subscriber’s subscription may be accepted or rejected in whole or in part, at any time by the Company at its sole discretion. In addition, the Company, at its sole discretion, may allocate to Subscriber-only a portion of the number of Tokens Subscriber has subscribed for. The Company will notify Subscriber whether this subscription is accepted (whether in whole or in part) or rejected. If Subscriber’s subscription is rejected, Subscriber’s payment (or portion thereof if partially rejected) will be returned to Subscriber without interest, and all of Subscriber’s obligations hereunder shall terminate. Subscriber hereby acknowledges and agrees that: (i) any returned funds may be repaid in U.S. Dollars, regardless of Subscriber’s initial form of payment; (ii) if Subscriber pays in any form of cryptocurrency accepted by the Company (including, without limitation, Bitcoin, Ether, or other crypto token), the Company may convert such payment to U.S. Dollars at any time after receipt at the then-applicable conversion rate; (iii) if such cryptocurrency payment is converted into U.S. Dollars, upon such return of funds, the Company shall not be liable for any fluctuations in the price of such cryptocurrency that occur during the period any of Subscriber’s funds (and the proceeds thereof) are being held by the Company or for its benefit.

 

            (d)       The aggregate number of Tokens sold in this offering shall not exceed 50,000,000 Tokens (the “Maximum Offering”). The Company may accept subscriptions until (i) the date at which the Maximum Offering is subscribed; (ii) the date at which a registered offering pursuant to Regulation A+ is qualified by the SEC, or (iii) the Company decides to terminate or extend this offering at any time in its sole discretion in accordance with applicable SEC regulations. This Offering is being conducted on a “best-effort” basis as provided by Rule 251(d)(3)(i)(F) of Regulation A, which means that there is no guarantee that any minimum amount will be sold.

 

(e)    In the event of rejection of this subscription in its entirety, or in the event the sale of the Securities (or any portion thereof) is not consummated for any reason, this Subscription Agreement shall have no force or effect, except for Section 5 hereof, which shall remain in force and effect.

 

2.         Purchase Procedure. The purchase price for the Tokens shall be paid simultaneously with the execution and delivery to the Company of this Subscription Agreement. Payment for the Tokens shall be received by the Company from the undersigned Subscriber by transfer immediately available funds via wire, ACH, or other means approved by the Company (including payments of Bitcoin and Ether to the wallet address provided by the Company), using the instructions below. Upon the Company’s acceptance of each subscription, the undersigned shall receive notice of acceptance, and Token will be delivered to the ERC-3643 compatible wallet address provided by Subscriber. 

 

3.         Representation and Warranties of the Company. The Company represents and warrants to Subscriber that the following are true and complete in all material respects as of the date of closing, except as otherwise indicated. For purposes of this Agreement, an individual shall be deemed to have “knowledge” of a particular fact or other matter if such individual is actually aware of such fact. The Company will be deemed to have “knowledge” of a particular fact or other matter if one of the Company’s current officers has, or at any time had, actual knowledge of such fact or other matter.

 

            (a)       Organization and Standing. The Company is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Wyoming. The Company is duly qualified and is authorized to do business and is in good standing as a foreign limited liability company in all jurisdictions in which the nature of its activities and its properties (both owned and leased) makes such qualification necessary, except for those jurisdictions in which failure to do so would not have a material adverse effect on the Company or its business.

            (b)       Issuance of the Securities. The issuance, sale, and delivery of the Tokens in accordance with this Subscription Agreement has been duly authorized by all necessary corporate action on the part of the Company. The Tokens, when so issued, sold, and delivered against payment therefor in accordance with the provisions of this Subscription Agreement, will be duly and validly issued, fully paid, and non-assessable.

            (c)        Authority for Agreement. The execution and delivery by the Company of this Subscription Agreement and the consummation of the transactions contemplated hereby (including the issuance, sale, and delivery of the Tokens) are within the Company’s powers and have been duly authorized by all necessary corporate action on the part of the Company. Upon full execution hereof, this Subscription Agreement shall constitute a valid and binding agreement of the Company, enforceable against the Company in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by-laws relating to the availability of specific performance, injunctive relief, or other equitable remedies and (iii) with respect to provisions relating to indemnification and contribution, as limited by considerations of public policy and by federal or state securities laws.

            (d)       Proceeds. The Company shall use the proceeds from the issuance and sale of Securities as set forth in “Use of Proceeds” in the Memorandum. 

            (e)       Litigation. The Company acknowledges that there is no pending action, suit, proceeding, arbitration, mediation, complaint, claim, charge or investigation before any court, arbitrator, mediator or governmental body, or to the Company’s knowledge, currently threatened in writing (a) against the Company or (b) against any consultant, officer, manager, director or key employee of the Company arising out of his or her consulting, employment or board relationship with the Company or that could otherwise materially impact the Company.

4.         Representation and Warranties of Subscriber. By executing this Subscription Agreement, Subscriber (and, if Subscriber is purchasing the Securities subscribed for hereby in a fiduciary capacity, the person or persons for whom Subscriber is so purchasing) represents and warrants the following, which representations and warranties are true and complete in all material respects as of such Subscriber’s respective closing:

            (a)       Requisite Power and Authority. Such Subscriber has all the necessary power and authority under all applicable provisions of law to execute and deliver this Subscription Agreement and other agreements required hereunder and carry out their provisions. All action on Subscriber’s part required for the lawful execution and delivery of this Subscription Agreement and other agreements required hereunder have been or will be effectively taken prior to the closing. Upon their execution and delivery, this Subscription Agreement and other agreements required hereunder will be valid and binding obligations of Subscriber, enforceable in accordance with their terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, or other laws of general application affecting enforcement of creditors’ rights and (b) as limited by general principles of equity that restrict the availability of equitable remedies.

            (b)       Investment Representations. Subscriber understands that the Securities have not been registered under the Securities Act. Subscriber also understands that the Securities are being offered and sold pursuant to an exemption from registration requirements contained in the Securities Act and such state or foreign jurisdiction laws. Subscribers further acknowledge that the Securities are subject to restriction on transferability and resale and may not be transferred or resold except as permitted under the Securities Act and such laws pursuant to registration or exemption therefrom.

            (c)        Illiquidity and Continued Economic Risk. Subscriber acknowledges and agrees that there is no ready public market for the Securities and that there is no guarantee that a market for their resale will ever exist. Subscriber must bear the economic risk of this investment indefinitely, and the Company has no obligation to list the Securities on any market or take any steps (including registration under the Securities Act or the Exchange Act) with respect to facilitating trading or resale of the Securities. Subscriber acknowledges that Subscriber is able to bear the economic risk of losing Subscriber’s entire investment in the Securities. Subscriber also understands that an investment in the Company involves significant risks and has taken full cognizance of and understands all of the risk factors relating to the purchase of Securities.

            (d)       Accredited Investor Status or Investment Limits. Subscriber represents that either:

(i)    Subscriber is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act. Subscriber represents and warrants that the information set forth in response to question (c) on the signature page hereto concerning Subscriber is true and correct; or

(ii)    The purchase price set out in paragraph (b) of the signature page to this Subscription Agreement, together with any other amounts previously used to purchase Securities in this offering, does not exceed 10% of the greater of the Subscriber’s annual income or net worth (or in the case of a Subscriber that is a non-natural person, their revenue or net assets for such Subscriber’s most recently completed fiscal year-end).

Subscriber represents that to the extent it has any questions with respect to its status as an accredited investor, or the application of the investment limits, it has sought professional advice.

            (e)       Company Information. Subscriber understands that the Company is subject to all the risks that apply to early-stage companies, whether or not those risks are explicitly set out in the Memorandum. Subscriber has had such opportunity as it deems necessary to read the Company’s whitepaper and discuss the Company’s business, management, and financial affairs with managers, officers, and management of the Company. Subscriber has also had the opportunity to ask questions of and receive answers from the Company and its management regarding the terms and conditions of this investment. Subscriber acknowledges that except as set forth herein, no representations or warranties have been made to Subscriber, or to Subscriber’s advisors or representative, by the Company or others with respect to the business or prospects of the Company or its financial condition.

 

            (f)        Valuation. The Subscriber acknowledges that the price of the Securities was set by the Company on the basis of the Company’s internal valuation and no warranties are made as to value. The Subscriber further acknowledges that future offerings of Securities may be made at lower valuations, with the result that the Subscriber’s investment will bear a lower valuation.

 

            (g)       Domicile. Subscriber maintains Subscriber’s domicile (and is not a transient or temporary resident) at the address shown on the signature page.

 

            (h)       No Brokerage Fees. There are no claims for a brokerage commission, finders’ fees or similar compensation in connection with the transactions contemplated by this Subscription Agreement or related documents based on any arrangement or agreement binding upon Subscriber

 

            (i)         Foreign Investors. If Subscriber is not a United States person (as defined by Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended), Subscriber hereby represents that it has satisfied itself as to the full observance of the laws of its jurisdiction in connection with the issuance of the Tokens or any use of this Subscription Agreement, including (i) the legal requirements within its jurisdiction for the purchase of the Securities, (ii) any foreign exchange restrictions applicable to such purchase, (iii) any governmental or other consents that may need to be obtained, and (iv) the income tax and other tax consequences, if any, that may be relevant to the purchase, holding, redemption, sale, or transfer of the Securities. Subscriber’s must confirm subscription and payment for and continued beneficial ownership of the Securities will not violate any applicable securities or other laws of the Subscriber’s jurisdiction.

 

            (j)         Risk Of Losing Access to Tokens. There are certain risks associated with purchasing, holding, and using Tokens. By subscribing to tokens, the Subscriber acknowledges and assumes such risks, including, but not limited to risk of losing access to Tokens due to loss of password(s), private keys, hacking and security weakness, or any risk associated with markets for security tokens.

 

5.         Survival of Representations and Indemnity. The representations, warranties, and covenants made by the Subscriber herein shall survive the termination of this Subscription Agreement. The Subscriber agrees to indemnify and hold harmless the Company and its respective officers, directors, and affiliates, and each other person, if any, who controls the Company within the meaning of Section 15 of the Securities Act against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all reasonable attorneys’ fees, including attorneys’ fees on appeal) and expenses reasonably incurred in investigating, preparing or defending against any false representation or warranty or breach of failure by the Subscriber to comply with any covenant or agreement made by the Subscriber herein or in any other document furnished by the Subscriber to any of the foregoing in connection with this transaction.

 

6.         Taxes. The purchase price paid by Subscriber for the Tokens is exclusive of all applicable taxes. Subscriber is responsible for determining what, if any, taxes apply to its purchase of Tokens, including, for example, sales, use, value-added, and similar taxes. Subscriber shall withhold, collect, report, and remit the correct taxes to the appropriate tax authorities. The Company is not responsible for withholding, collecting, reporting, or remitting any sales, use, value-added, or similar tax arising from Subscriber’s purchase of Tokens. Subscriber acknowledges and agrees that the Company has not provided it any tax advice or opinion.

 

7.         Governing Law. This Subscription Agreement will be governed by and construed, and enforced in accordance with the laws of the State of Wyoming, without regard to conflict of law rules that would cause the application of the laws of any other jurisdiction.

 

8.         Notices. Notice, requests, demands, and other communications relating to this Subscription Agreement and the transactions contemplated herein shall be in writing and shall be deemed to have been duly given if and when (a) delivered personally, on the date of such delivery; or (b) mailed by registered or certified mail, postage prepaid, return receipt requested, in the third day after the posting thereof; or (c) emailed on the date of such delivery to the address of the respective parties as follows:

 

 

 

 

 

If to the Company, to:

 

TREP, LLC

1309 Coffeen Avenue, STE 1200

Sheridan, WY 82801

Email: investor.relations@trep.co

 

If to a Subscriber, to Subscriber’s address or electronic mail address as supplied in connection with this subscription or to such other address as may be specified by written notice from time to time by the party entitled to receive such notice. 

 

9.         Miscellaneous. 

 

(a)    All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter, singular, or plural, as the identity of the person or persons or entity or entities may require.

 

(b)       This Subscription Agreement is not transferable or assignable by Subscriber.

 

            (c)    The representations, warranties, and agreements contained herein shall be deemed to be made by and be binding upon Subscriber and its heirs, executors, administrators, and successors and shall inure to the benefit of the Company and its successors and assigns.

 

            (d)       None of the provisions of this Subscription Agreement may be waived, changed or terminated orally or otherwise, except as specifically set forth herein or except by a writing signed by the Company and Subscriber.

 

            (e)       In the event any part of this Subscription Agreement is found to be void or unenforceable, the remaining provisions are intended to be separable and binding with the same effect as if the void or unenforceable part were never the subject of agreement.

 

            (f)        The invalidity, illegality, or unenforceability of one or more of the provisions of this Subscription Agreement in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Subscription Agreement in such jurisdiction or the validity, legality, or enforceability of this Subscription Agreement, including any such provision, in any other jurisdiction, it is intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.

 

            (g)       The terms and provisions of this Subscription Agreement are intended solely for the benefit of each party hereto and their respective successors and assigns, and it is not the intention of the parties to confer, and no provision hereof shall confer, third-party beneficiary rights upon any other person.

 

            (h)       The headings used in this Subscription Agreement have been inserted for convenience of reference only and do not define or limit the provisions hereof.

 

            (i)         This Subscription Agreement may be executed in any number of counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

            (j)         No failure or delay by any party in exercising any right, power, or privilege under this Subscription Agreement shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.

 

10.       Subscription Procedure. Subscriber, by completing their details and signing this Subscription Agreement shall immediately transfer funds via wire, ACH, or other means approved by the Company (including payments of Bitcoin and Ether to the wallet address provided by the Company). Following the transfer of funds and Company’s acceptance of the investment, the Tokens will be delivered to the wallet address provided by Subscriber.

 

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APPENDIX A

 

An accredited investor includes the following categories of investor:

 

(1) Any bank as defined in section 3(a)(2) of the Act, or any savings and loan association or other institution as defined in section 3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity; any broker or dealer registered pursuant to section 15 of the Securities Exchange Act of 1934; any insurance company as defined in section 2(a)(13) of the Act; any investment company registered under the Investment Company Act of 1940 or a business development company as defined in section 2(a)(48) of that Act; any Small Business Investment Company licensed by the U.S. Small Business Administration under section 301(c) or (d) of the Small Business Investment Act of 1958; any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 if the investment decision is made by a plan fiduciary, as defined in section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors;

 

(2) Any private business development company as defined in section 202(a)(22) of the Investment Advisers Act of 1940;

 

(3) Any organization described in section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;

 

(4) Any director, executive officer, or general partner of the issuer of the securities being offered or sold, or any director, executive officer, or general partner of a general partner of that issuer;

 

(5) Any natural person whose individual net worth, or joint net worth with that person’s spouse, exceeds $1,000,000.

 

(i) Except as provided in paragraph (a)(5)(ii) of this section, for purposes of calculating net worth under this paragraph (a)(5):

 

(A) The person’s primary residence shall not be included as an asset;

 

(B) Indebtedness that is secured by the person’s primary residence, up to the estimated fair market value of the primary residence at the time of the sale of securities, shall not be included as a liability (except that if the amount of such indebtedness outstanding at the time of sale of securities exceeds the amount outstanding 60 days before such time, other than as a result of the acquisition of the primary residence, the amount of such excess shall be included as a liability); and

 

(C) Indebtedness that is secured by the person’s primary residence in excess of the estimated fair market value of the primary residence at the time of the sale of securities shall be included as a liability;

 

(ii) Paragraph (a)(5)(i) of this section will not apply to any calculation of a person’s net worth made in connection with a purchase of securities in accordance with a right to purchase such securities, provided that:

 

(A) Such right was held by the person on July 20, 2010;

 

(B) The person qualified as an accredited investor on the basis of net worth at the time the person acquired such right; and

 

(C) The person held securities of the same issuer, other than such right, on July 20, 2010.

 

(6) Any natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year;

 

(7) Any trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a sophisticated person as described in §230.506(b)(2)(ii); and

 

(8) Any entity in which all of the equity owners are accredited investors.

 

 

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APPENDIX B

 

Determination of number of TREP Tokens Issued For BTC and ETH

 

The number of TREP Tokens which a Subscriber shall be entitled to receiving in exchange for payment made in ETH or BTC (the “Token Amount”), shall be determined based on the Daily BTC Exchange Rate (as defined below) and Daily ETH Exchange Rate (as defined below), as applicable, for the Receipt Day on which the Company receives the Purchaser Commitment Amount. The term “Receipt Day” means the period from, and including, 5:00:00 p.m. (E.T.) on a calendar day (the “Receipt Day Start Time”) and 5:00:00 p.m. (E.T.) on the succeeding business day (the “Receipt Day End Time”).

 

For purposes hereof, the “Purchaser Commitment Amount” means the aggregate amount of ETH or BTC delivered by a Subscriber to the Company pursuant to the Subscription Agreement.

 

BTC payments:

 

The Token Amount for BTC payments will be determined by the Company based upon the USD equivalent of the Purchaser Commitment Amount received by the Company, based upon the last traded price for a BTC to USD exchange transaction, as reflected on www.coinbase.com (“Coinbase”) which is closest to and includes (but is not after) 5:00:00 p.m. (E.T.), on the date on which the BTC Receipt Day End Time occurs (the “BTC Exchange Rate”). The Token Amount shall be calculated by dividing this USD equivalent Purchaser Commitment Amount by the per TREP Tokens USD price. 

 

ETH Payments:

 

The Token Amount for ETH payments will be determined by the Company based upon the USD equivalent of the Purchaser Commitment Amount received by the Company, based upon the last price quoted for an ETH to USD exchange transaction, as reflected on Coinbase, which is closest to and includes (but is not after) 5:00:00 p.m. (E.T.), on the date on which the ETH Receipt Day End Time occurs (the “ETH Exchange Rate”). The Token Amount shall be calculated by dividing this USD equivalent Purchaser Commitment Amount by the per TREP Tokens USD price.

 

 

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APPENDIX C

 

Determination of number of TREP Tokens Issued For other crypto tokens

 

The number of TREP Tokens which a Subscriber shall be entitled to receiving in exchange for other crypto tokens (the “Token Amount”), shall be determined based on the fair evaluation of the crypto token (as defined below) and token price quote by the issuer in USD, as applicable, for the Receipt Day on which the Company received the Purchasers Commitment Token Amount. The term “Receipt Day” means the period from, and including, 5:00:00 p.m. (E.T.) on a calendar day (the “Receipt Day Start Time”) and 5:00:00 p.m. (E.T.) on the succeeding business day (the “Receipt Day End Time”).

 

For purposes hereof, the “Purchasers Commitment Token Amount” means the aggregate amount of other crypto tokens delivered by a Subscriber to the Company pursuant to the Subscription Agreement.

 

Other crypto token payments:

 

The Token Amount for other crypto tokens will be determined by the Company based upon the price of the token presented by the issuer and fair evaluation. The evaluation of crypto tokens is based on a number of quantities techniques, including asset pricing model, market risks, annual income revenue, risk factors that determine the use of blockchain technology, and liquidity such as token reserves or excess cash flows.