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Dayton (OH) Historical District

Revitalize and provide attractive, marketable housing in a neighborhood environment.

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Summary

*No money or other consideration is being solicited or accepted at this time. No sales will be made or commitments to purchase accepted until the offering statement is qualified. A prospective purchaser’s indication of interest in non-binding. Sales made pursuant to Regulation A are contingent upon the qualification of the offering statement. 

Dayton Downtown Revitalization Fund
Offering Size: $20,000,000
Sponsor: Lumpkin & Lumpkin LLC
Sector: Real Estate
Location: Dayton
Total Shares: 4,000,000
Price Per Share: : 5
Funding Type: Regulation D 506(c), Regulation A

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Investor Education
The SEC defines an accredited investor as either: an individual with gross income exceeding $200,000 in each of the two most recent years or joint income with a spouse or partner exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year.

The National Markets Improvement Act of 1996 (NSMIA)

Generally, an offering and/or sale of securities must be either registered or exempt from registration under both the federal Securities Act of 1933 (“Securities Act”) and state securities laws.  As a result of a lack of uniformity in state securities laws and associated burden on capital-raising transactions, on October 11, 1996, the National Securities Markets Improvement Act of 1996 (“NSMIA”) was enacted into law.

The NSMIA amended Section 18 of the Securities Act to pre-empt state “blue sky” registration and review of specified securities and offerings. The preempted securities are called “covered securities.” The NSMIA also amended Section 15 of the Exchange Act to pre-empt the state’s authority over capital, custody, margin, financial responsibility, making and keeping records, bonding or financial or operational reporting requirements for brokers and dealers.

In enacting the NSMIA, the legislature purposefully did not include certain securities which remain subject to the dual regulation of states and the federal government. Examples of securities that are specifically excluded from the NSMIA list of “covered securities” include securities that trade on the over-the-counter market, registered direct public offerings and securities issues in Rule 504 offerings.

State Blue Sky Laws in General

Securities issued in transactions which are not covered securities, such as Regulation D Rule 504 offerings, intra-state offerings, and registered direct or initial public offerings, must comply with state blue sky laws. In addition, the re-sale (secondary trading) of securities must either be pre-empted or comply with state blue sky laws.

Like the federal laws, state securities laws require registration or the availability of an exemption for the offer or sale of securities, and provide statutory exemptions from registration. In addition, every brokerage firm, individual registered representative of a brokerage firm, issuer and issuer representative must either be registered as, or exempt from, the broker-dealer registration requirements prior to selling securities. There are 54 U.S. jurisdictions, including all 50 states and 4 territories, each with separate securities laws.

Although many states have adopted the Uniform Securities Act of 1956 (the “Uniform Act”), or variations on such Act, state blue sky laws still differ greatly. Even in states that have identical statutes, the state’s interpretations or focus under the statutes differ greatly. The most common areas of divergence among the states relate to:

  • Notice and filing requirements can be extremely different in terms of the amount of money required, the paperwork demanded, questions asked and the time to review and approve registration;
  • Standards of merit review – see discussion below on merit review standards.  Different states can issue vastly different comments in different focus areas for the same issuer;
  • Length of comment periods – The amount of review time can be inconsistent from days in certain states to weeks and even months in others;
  • Suitability standards;
  • Notice requirements for exempt offerings, even under the Uniform Limited Offering Exemption;
  • Required legends on offering materials;
  • Disclosure requirements can be varied, and some states will make the issuer sticker the offering with different disclosure items or put in language changing the meaning of some phrases;
  • Required forms in addition to the standard Form D in exempt offerings;
  • Treatment of offerings of asset-backed securities; and
  • Financial statement requirements – some states require audited financial statements and others do not.

Most states have some form of limited offering exemption based on either the number of offerees or purchasers, the dollar amount of the offering, or a combination of these limitations. Most states have a private offering exemption, many of which are substantially similar to the federal Section 4(a)(2). Many states have exemptions for offerings limited to accredited investors. Many states have adopted the NASAA’s Uniform Limited Offering Exemption, which is similar to the federal Rule 506(b) exemption.

State Merit Review

Over 40 states apply a “merit review” approach to state registered offerings. In conducting a merit review, state regulators make a determination regarding the fairness of the offering to investors.  A merit review is a substantive review of the issuer and the offering and is designed to prevent fraudulent or inequitable offerings. Common merit review topics include:

  • Discounted stock sales, including sales to insiders and promoters that are completed in close proximity to the offering at significantly discounted prices;
  • Affiliate transactions including loans.  Loans to affiliates usually must be repaid before the offering, and affiliate transactions must be on arm’s length terms;
  • Debt offerings will generally require sufficient cash flows to cover debt servicing charges and payments, and states may ask that a sinking fund be established or a trust indenture meeting the requirements of the Trust Indenture Act of 1939;
  • A state may require that the issuer agree to the impoundment of offering proceeds;
  • Options and warrants – the state may request limits on the number of outstanding options or warrants or may dictate the terms of exercisability (such as no less than 85% of market value); limits may be set on underwriter compensatory issuances;
  • Preferred Stock – states may require current and/or past net income to cover dividends or other obligations under preferred instructions; if the preferred stock is being offered, the state may require redemption provisions and other investor-friendly rights;
  • Promoter’s equity investment – the state may require that a promoter’s equity interest be more than 10% of the post-offering equity (i.e., ensuring the promoter is an affiliate and subject to affiliate resale restrictions);
  • Promotional shares – the state may require the escrow of shares or the reduction of the offering price where equity securities of a development-stage company have been issued to promoters and/or insiders for less than 85% of the offering price;
  • Selling expenses and selling security holders – states may limit the expenses to a percentage of the offering amount or require selling security holders to pay a pro rata share of offering expenses;
  • Unequal voting rights – states may prohibit or limit unequal voting rights;
  • Capitalization requirements – states may prohibit the issuance of any security except common equity for development-stage or less seasoned issuers; and
  • Specifying offering price – states may require that the offering price be related to book value, earnings history and/or industry price/earnings multiples or set other parameters on the offering price.

The NASAA has published Statements of Policy regarding merit standards both generally and for specific industries.  Many states have either adopted such policies or refer to them as guidelines in their review process.

Blue Sky Laws and Secondary Trading

Only the secondary trading of securities that are traded on a national securities exchange is automatically preempted from compliance with state blue sky laws. The NSMIA preempts Sections 4(a)(1) secondary sales and 4(a)(4) broker transactions on behalf of customers, where the issuer is subject to the Exchange Act reporting requirements.  Section 4(a)(1), is a registration exemption for “transactions by any person other than an issuer, underwriter, or dealer.”  Section 4(a)(4) of the Securities Act of 1933 (“Securities Act”) provides an exemption for broker-dealers when executing customers’ unregistered sales of securities if, after reasonable inquiry, the broker-dealer is not aware of circumstances indicating that the customer would be violating the registration requirements of Section 5 of the Securities Act.  Section 4(a)(4) is not, in and of itself, an exemption from registration.  Section 4(a)(4) allows brokers to process the sale of unregistered securities where there is a valid exemption from such registration.  Section 4(a)(4) generally works in conjunction with Section 4(a)(1), and the two together provide the basis for most secondary trading of securities on established trading markets.

The secondary trading of securities for issuers that are not subject to the SEC reporting requirements, including those that voluntarily report, or transactions that do not qualify under Sections 4(a)(1) or 4(a)(4) must satisfy state blue sky laws. If a security is not blue sky eligible in a given state, broker-dealers and investment advisers cannot give advice, solicit, distribute research or make recommendations to investors in that state.

It can be very difficult, if not impossible, to comply with blue sky laws for secondary trading in all 54 jurisdictions. The Manual’s Exemption, discussed further below, provides some assistance in this regard.  However, Alabama, Kentucky and Virginia have no exemption whatsoever for the secondary trading of non-reporting issuers’ securities.

In a letter written to the SEC on March 24, 2014, arguing for blue sky preemption for Regulation A offerings, OTC Markets Group, Inc. (“OTC Markets”) homed in on blue sky issues in general and specifically related to secondary trading. OTC Markets pointed out that “[T]he prohibition on advice and research in certain jurisdictions leaves investors uninformed of investment opportunities and risks, and, just as importantly, prevents investment professionals from advising their clients of the specific risks of investing in a security. Investors are left to determine the risks and potential benefits of an investment on their own, which runs counter to each jurisdiction’s otherwise very worthy investor protection goals.”

Even though a broker may not solicit or make recommendations, it can process unsolicited trades on behalf of a customer that requests it to do so. However, if that customer later claims that the broker recommended such a trade, that broker can be liable for damages.  Accordingly, many brokerage firms simply refuse to process any trades for securities that are not blue sky eligible.

The OTC Markets letter to the SEC provides an excellent analysis of the lack of uniformity in blue sky laws related to secondary trading and in particular, the difficulty for a non-reporting issuer to satisfy such requirements. The letter poignantly points out that “[O]TC Markets Group is itself a non-SEC registered company that makes annual audited financial reports, quarterly and current information available to investors; has profiles published in both major securities manuals; and has worked at length with every jurisdiction to gain Blue Sky compliance. Despite our diligence, we have gained only 44 jurisdictions, which means we are not Blue Sky eligible to over 11% of the U.S. population.”

The OTC Markets letter includes statistics related to blue sky compliance by companies trading on the OTCQB and OTCQX. OTC Markets reviewed 395 companies. Of the 395 companies, not a single one was in compliance with all jurisdictions and only 0.5% are in compliance for secondary trading in New Hampshire, California, Guam, Kentucky, Montana, North Dakota, Utah and Virginia. The statistics make clear the difficulties companies face in complying with blue sky requirements, and the obvious need for further federal intervention.

The Manual Exemption

The Manual Exemption is a state exemption for the secondary trading of securities. There are a total of 54 U.S. jurisdictions, including all 50 states and 4 territories, each with their own securities laws. Forty-four (44) of these jurisdictions offer a form of the Manual Exemption for the secondary trading of securities. Issuers that trade in states that do not have the Manual Exemption must satisfy a secondary trading exemption in other ways.

The Manual Exemption is an exemption for the secondary trading of securities where the issuer has a profile published in a recognized securities manual such as Mergent’s or Standard & Poors, including specific enumerated information and financial statements. Some states require the filing of supplemental or additional information to qualify for the Manual Exemption. Moreover, differing state statutory language is confusing and it is often difficult to determine whether a company has or is qualified for the Manual Exemption.

NASAA Regulation A Coordinated Review Process

Of the total 54 U.S. jurisdictions, including all 50 states and 4 territories, 48 participate in the Regulation A Tier 1 coordinated review process. The NASAA coordinated review process is well put together and seems to have a focus on both investor protection and supportive assistance for the issuer. An issuer elects to complete the coordinated review process by completing a Form CR-3b and submitting the application together with a copy of the completed Form 1-A and audited financial statements to Washington State by e-mail. The application contains a “check the box” for the states in which the issuer desires to qualify. Filing fees are mailed separately to each of the states.

A lead merit and a lead disclosure examiner are then appointed to manage the review process. If the issuer is not applying in any state with merit review, only a lead disclosure examiner is appointed. The filing goes through a review, comment and amendment process with the lead examiner issuing comment letters on behalf of all states.

The review process timing is relatively quick.  Within three days of filing, an issuer receives a written receipt for the filing and a letter detailing the review process. Within ten days of the filing confirmation, the lead examiner drafts a proposed comment letter for the individual states to review and add to. The first comment letter must be delivered to the issuer within 21 days of filing.

The lead examiner schedules conference calls to discuss the comments and how the issuer can address the concerns. Moreover, the examiners make themselves available for discussion of comments and responses throughout the process, allowing for a type of cooperative relationship between the examiner and issuer. Issuers’ comment responses are reviewed within five business days of receipt. If there are no comments, the offering will be cleared within 21 business days of filing.

The review standard itself is based on the NASAA Statements of Policy, which cover a wide array of topics—including, for example, impoundment of proceeds, loans and other material affiliated transactions, options and warrants, preferred stocks, promoter’s equity investment, promotional shares, specificity in use of proceeds, underwriting expenses, unsound financial condition and voting rights.

NASAA Coordinated Filing Program for Form D’s associated with Regulation D, Rule 506

The NASAA offers a coordinated multi-state filing system allowing issuers to submit a Form D for Regulation D, Rule 506 offerings and pay-related fees to participating state securities regulators. The system is called the Electronic Filing Depository and is currently only available for Rule 506 Form D filings. Not all states participate with the system. Arizona, California, Connecticut, Delaware, Florida, Louisiana, Massachusetts, Michigan, Minnesota, New York, North Carolina and Oregon are not included. In addition to state filing fees, the NASAA charges a one-time $150 fee to use the system.

The initial sale of securities to the public, often called an IPO.

A non-accredited investor is any investor who does not meet the income or net worth requirements set out by the Securities and Exchange Commission (SEC). The concept of a non-accredited investor comes from the various SEC acts and regulations that refer to accredited investors.

Regulation A+ is a legal process allowing companies to file a registration statement with the SEC that in turn can be used to sell debt or equity securities to the masses to raise capital.

It is just a legal process that allows benefits to companies raising capital, such as active advertising and solicitation including through social media. There is no pool of funds to tap into; it is not a line of credit; it is just another process that companies can use to reach out to you, the investing public, and try to convince you to buy stock in, or lend money to, their company.

Like any registered securities, securities sold in a Regulation A+ transaction are not restricted and so they are available to create a secondary market and be traded such as on the OTC Markets or a national exchange.

Regulation CF, The Crowdfunding exemption, allows Issuers to raise up to $1 million in a twelve-month period, as long as no individual investment exceeds certain threshold amounts. The threshold amount sold to any single investor, cannot exceed (a) the greater of $2,000 or 5% of the annual income or net worth of such investor, if their annual income or next worth is less and $100,000; and (b) 10% of the annual income or net worth of such investor, not to exceed a maximum $100,000, if their annual income or net worth is more than $100,000. The Crowdfunding Act reads such that this exemption will integrate with (i.e. be added to) securities sold under other exemptions during the 12 month period.

Regulation D under the Securities Act provides a number of exemptions from the registration requirements, allowing some companies to offer and sell their securities without having to register the offering with the SEC.

Rule 504 of Regulation D exempts from registration the offer and sale of up to $10 million of securities in a 12-month period. A company is required to file a notice with the Commission on Form D within 15 days after the first sale of securities in the offering. In addition, a company must comply with state securities laws and regulations in the states in which securities are offered or sold.

A retail investor is a non-professional who trades smaller volumes of stocks, bonds, exchange-traded funds (ETFs), or mutual funds for their own personal account, using their own money.

The Securities Act of 1933 (“Securities Act”) Rule 144 sets forth certain requirements for the use of Section 4(a)(1) for the resale of securities. Section 4(a)(1) of the Securities Act provides an exemption for a transaction “by a person other than an issuer, underwriter, or dealer.” The terms “Issuer” and “dealer” have pretty straightforward meanings under the Securities Act, but the term “underwriter” does not. Rule 144 provides a safe harbor from the definition of “underwriter.” If all the requirements for Rule 144 are met, the seller will not be deemed an underwriter and the purchaser will receive unrestricted securities.

Rule 144 provides certain conditions that must be met for sales by both affiliates and non-affiliates which conditions vary depending on whether the Issuer of the securities is a reporting or non-reporting Issuer. The following chart summarizes the Rule 144 requirements.

The term rules and regulations as used in sections 7, 10 (a), (c) and (d) and 19(a) of the Act, shall include the forms for registration of securities under the Act and the related instructions thereto.

General Rules and Regulations, Securities Act of 1933

Rule 144 Persons Deemed Not To Be Engaged In A Distribution and Therefore Not Underwriters

Rule 147 Exemption for Intrastate Offers and Sales of Securities

Rule 155 Integration of Abandoned Offerings

Regulation A Conditional Small Issues Exemption

Regulation C Registration and Filing Requirements

Regulation D Rules Governing the Limited Offer and Sale Of Securities Without Registration Under the Securities Act

Rule 701 Exemption For Offers and Sales of Securities Pursuant To Certain Compensatory Benefit Plans And Contracts Relating To Compensation

Regulation S Rules Governing Offers and Sales Made Outside The United States Without Registration Under The Securities Act)

 

General Rules and Regulations, Securities Act of 1934

Regulation 12B Exchange Act Registration and Reporting

Regulation 13D and 13G Securities Ownership

Schedule 13D Statement Of Beneficial Ownership

Schedule 13G Statement Of beneficial ownership

Rule 13e-3 Going Private Transactions

Regulation 14A Proxy Rules

Schedule 14A Proxy Statement Pursuant To Section 14(a) Of The Exchange Act

Regulation 14C Distribution Of Information Pursuant To Section 14(c) Of The Exchange Act

Schedule 14C Information Statement Pursuant To Section 14(c) Of The Exchange Act

Section 16 Rules Ownership Reports and Trading By Officers, Directors And Principal Security Holders

Regulation FD Fair Disclosure

Regulation BTR Blackout Trading Restrictions

Descriptions of Exchange Act Forms Forms Prescribed Under The Exchange Act

Industry Guides Securities Act and Exchange Act Industry Guides

Regulation S-K

 

Statutes

The Securities Act of 1933

The Exchange Act of 1934

The Investment Company Act of 1940

Jumpstart Our Business Startups Act (JOBS Act)
The JOBS Act requires the SEC to write rules and issue studies on capital formation, disclosure and registration requirements.

Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank)
The Dodd-Frank Act was written to promote the financial stability of the United States by improving accountability and transparency in the financial system, to end ‘‘Too Big To Fail’’, to protect the American taxpayer by ending bailouts, to protect consumers from abusive financial services practices, and for other purposes.

Sarbanes-Oxley Act of 2002 (SOX)
SOX was written to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to the securities laws, and for other purposes.

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Disclosures

360SportsX.com (“Website”) and other websites pointed to this domain are owned and operated by 360 Sports, Inc. (“360 Sports”), a Delaware C Corporation.

360 Sports is a founder and/or affiliate of this fund as defined by the SEC in SEC Rules 230.144, 230.405, and other definitions within the intended context of the SEC’s definition of the affiliated relationship with a fund.

360 Sports is not paid any fees by the companies that make investment and reservation offerings on this website.

By accessing this website or any page thereof, you agree to be bound by the Terms of Use and Privacy Policy, as amended from time to time and in effect at the most recent time you access this website or any page thereof.

Nothing on this website shall constitute an offer to sell, or a solicitation of an offer to subscribe for or buy, any securities to any person in any jurisdiction to whom or in which such offer or solicitation is unlawful.

Consequently, any featured, front page, or prominent placement of a listed company on this site is not deemed to be a recommendation and may be based on various algorithms or selections that drive traffic to such listed company.

360 Sports is not a law firm, valuation service, underwriter, broker-dealer, or Title III crowdfunding portal and we do not engage in any activities requiring any such registration.

We do not provide advice on investments. 360 Sports does not structure Reg CF transactions. Do not interpret any advice from 360 Sports staff as a replacement for advice from service providers in these professions.

Listed companies are actively seeking to raise early-stage capital pursuant to Rule 506(b) or Rule 506(c) of Regulation D (“Regulation D”) under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or pursuant to Regulation CF (often referred to as “Crowdfunding”), or Regulation A (sometimes referred to as “Regulation A+”) under the Securities Act (“Regulation A”).

The definition of a listed company is a company whose information is posted on this website. A listed company’s offerings are being made by, and all the information included on this website relating to a listed company and its securities has been provided by and is the responsibility of, such listed company. A listed company’s offerings on this website, if made pursuant to Rule 506(b) or Rule 506(c) of Regulation D, generally are available only to “accredited investors” as defined in Regulation D. Accredited investors are able to identify listed companies in which they may have an interest after a certification process for Rule 506(b) offerings, while Rule 506(c) offerings are available for the general public to view.

Offerings made pursuant to Regulation A are also generally available for the general public to view. Investing in securities, particularly securities issued by start-up companies, involves substantial risk, and investors should be able to bear the loss of their entire investment. All investors should make their own determination of whether or not to make any investment based on their own independent evaluation and analysis. See our Investor Risks and Education Guide on the “FAQ” page on this website.

360 Sports does not verify or assure that information provided by any listed company offering its securities is accurate or complete or that the valuation of such securities is appropriate. The content (Blogs, FAQs, News, and other resources) posted on 360 Sports may contain incorrect or outdated information at times; therefore, always get professional advice before considering an investment featured on this website.

Neither 360 Sports nor any of its directors, officers, employees, representatives, affiliates, or agents shall have any liability whatsoever arising from any error or incompleteness of fact or opinion in, or lack of care in the preparation of, any of the materials posted on this website. 360 Sports does not provide legal, accounting, or tax advice. Any representation or implication to the contrary is expressly disclaimed.

You can learn more about investing in Regulation D and Regulation A offerings from the SEC or FINRA.

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Exhibit 16.05

Dayton Downtown Revitalization Fund

SUBSCRIPTION AGREEMENT

THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. THIS INVESTMENT IS SUITABLE ONLY FOR PERSONS WHO CAN BEAR THE ECONOMIC RISK FOR AN INDEFINITE PERIOD OF TIME AND WHO CAN AFFORD TO LOSE THEIR ENTIRE INVESTMENT.  FURTHERMORE, INVESTORS MUST UNDERSTAND THAT SUCH INVESTMENT IS ILLIQUID AND IS EXPECTED TO CONTINUE TO BE ILLIQUID FOR AN INDEFINITE PERIOD OF TIME. NO PUBLIC MARKET  EXISTS FOR THE SECURITIES.

THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES OR BLUE SKY LAWS AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND STATE SECURITIES OR BLUE SKY LAWS.

ALTHOUGH AN OFFERING STATEMENT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE “SEC”), THAT OFFERING STATEMENT DOES NOT INCLUDE THE SAME INFORMATION THAT WOULD BE INCLUDED IN A REGISTRATION STATEMENT UNDER THE ACT. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC, ANY STATE SECURITIES COMMISSION, OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON THE MERITS OF THIS OFFERING OR THE ADEQUACY OR ACCURACY OF THE SUBSCRIPTION AGREEMENT OR ANY OTHER MATERIALS OR INFORMATION MADE AVAILABLE TO PROSPECTIVE INVESTOR IN CONNECTION WITH THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

THE SECURITIES CAN NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE SECURITIES ACT. IN ADDITION, THE SECURITIES CAN NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS. INVESTORS WHO ARE NOT “ACCREDITED INVESTORS” (AS THAT TERM IS DEFINED IN SECTION 501 OF REGULATION D PROMULGATED UNDER THE SECURITIES ACT) ARE SUBJECT TO LIMITATIONS ON THE AMOUNT THEY MAY INVEST, AS SET OUT IN SECTION 4(g). THE COMPANY IS RELYING ON THE REPRESENTATIONS AND WARRANTIES SET FORTH BY EACH INVESTOR IN THIS SUBSCRIPTION AGREEMENT AND THE OTHER INFORMATION PROVIDED BY THE INVESTOR IN CONNECTION WITH THIS OFFERING TO DETERMINE THE APPLICABILITY TO THIS OFFERING OF EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

PROSPECTIVE INVESTORS MAY NOT TREAT THE CONTENTS OF THE SUBSCRIPTION AGREEMENT, THE OFFERING CIRCULAR, OR ANY OF THE OTHER MATERIALS PROVIDED BY THE COMPANY (COLLECTIVELY, THE “OFFERING MATERIALS”), OR ANY PRIOR OR SUBSEQUENT COMMUNICATIONS FROM THE COMPANY OR ANY OF ITS OFFICERS, EMPLOYEES OR AGENTS (INCLUDING “TESTING THE WATERS” MATERIALS) AS INVESTMENT, LEGAL OR TAX ADVICE. IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE COMPANY AND THE TERMS OF THIS OFFERING, INCLUDING THE MERITS AND THE RISKS INVOLVED. EACH PROSPECTIVE INVESTOR SHOULD CONSULT THE INVESTOR’S OWN COUNSEL, ACCOUNTANTS, AND OTHER PROFESSIONAL ADVISORS AS TO INVESTMENT, LEGAL, TAX AND OTHER RELATED MATTERS CONCERNING THE INVESTOR’S PROPOSED INVESTMENT.

THE OFFERING MATERIALS MAY CONTAIN FORWARD-LOOKING STATEMENTS AND INFORMATION RELATING TO, AMONG OTHER THINGS, THE COMPANY, ITS BUSINESS PLAN AND STRATEGY, AND ITS INDUSTRY. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF, ASSUMPTIONS MADE BY, AND INFORMATION CURRENTLY AVAILABLE TO THE COMPANY’S MANAGEMENT. WHEN USED IN THE OFFERING MATERIALS, THE WORDS “ESTIMATE,” “PROJECT,” “BELIEVE,” “ANTICIPATE,” “INTEND,” “EXPECT” AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS, WHICH CONSTITUTE FORWARD-LOOKING STATEMENTS. THESE STATEMENTS REFLECT MANAGEMENT’S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE THE COMPANY’S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN THE FORWARD-LOOKING STATEMENTS. INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE ON WHICH THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE ANY OBLIGATION TO REVISE OR UPDATE THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES AFTER SUCH DATE OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS.

 

Subscription Agreement

Class A Common
Units

in

Dayton Downtown Revitalization Fund

The undersigned (the “Investor”) represents and understands that Dayton Downtown Revitalization Fund, a  , (the “Issuer”), is offering up to  shares of its (the “Securities”), for per unit (the “Purchase Price”) in a Regulation A+ offering (the “Offering”) subject to the Issuer’s Form 1-A SEC filing (the “Form 1-A”) and the Issuer’s operating agreement, dated as of November 8, 2021, (the “Operating Agreement”) (collectively, the Operating Agreement together with Form 1-A, are the “Offering Documents”), each as may be amended. The Investor further understands that the Offering is being made without registration of the Securities under the Securities Act of 1933, as amended (the “Securities Act”), or any securities law of any state of the United States or of any other jurisdiction. The Offering has a minimum amount raised target of $100,000 (the “Target Offering Amount”) and a maximum offering target of $ (the “Maximum Offering Amount”). The offering has a deadline to raise the Target Offering Amount as of  (the “Offering Deadline”). Once the Offering reaches the Target Offering Amount, the Issuer may elect to hold an initial Closing, as indicated below and continue to raise funds up to the Maximum Offering Amount.

This Subscription Agreement (this “Subscription Agreement”) relates to Investor’s agreement to purchase Securities in the amount set forth on the Signature Page hereto, to be issued by the Issuer, subject to the terms, conditions, acknowledgments, representations, and warranties stated herein and in the Offering Documents for the sale of the Securities, as the same may be supplemented or amended. Capitalized terms used but not defined herein shall have the
meanings are given to them in the Offering Documents.

Investor understands that if Investor wishes to purchase Securities, the investor must complete this Subscription Agreement and submit the applicable Subscription Price in accordance with the instructions set
forth in the Offering Documents and on the Portal’s page for this Offering. Investor understands that the purchase price per unit
of Securities is

5
.

In order to induce the Company to accept this Subscription Agreement for Securities and as further consideration for such acceptance, Investor hereby makes, adopts, confirms, and agrees to all of the following covenants, acknowledgments,  epresentations, and warranties with the full knowledge that the Company and its affiliates will expressly rely thereon upon making a decision to accept or reject this Subscription Agreement.

1.           Subscription.
Subject to the terms and conditions hereof and the provisions of the Offering Documents, the Investor hereby irrevocably subscribes for the Securities set forth on the signature page hereto in the aggregate purchase amount or price there indicated (the “Total Purchase Price”), which is payable as described in Section 4 hereof. The Investor acknowledges that the Securities will be subject to restrictions on transfer as set forth in this Subscription Agreement. Investor understands that the Securities are being offered pursuant to the Form 1-A and its exhibits as filed with and qualified by the Securities and Exchange Commission (the “SEC”).

2.           Acceptance of
Subscription and Issuance of Securities. It is understood and agreed that the Issuer shall have the sole right, in its complete discretion, to accept or reject this subscription, in whole or in part, for any reason and that the same shall be deemed to be accepted by the Issuer only when Investor has received confirmation of closed investment notice from the portal (the “Portal”). Subscriptions need not be accepted in the order received, and the Securities may be allocated among subscribers.

3.           The Closing.
The closing of the purchase and sale of the Securities shall take place at 11:59 PM Pacific Time on the Offering Deadline or at such earlier time as set by the Issuer (the “Closing”), subject to the following conditions:

(a)       The Offering may not close if the cumulative subscriptions in the Offering have not reached the Target Offering Amount.

(b)       The Offering may not close for any individual subscriber until such subscriber’s identity is verified and approved with the escrow agent (the “Escrow Agent”) and/or the broker-dealer (the “Broker-Dealer”), and their funds have cleared the escrow account (the “Escrow Account”).

(c)       If the Issuer sets a Closing earlier than the Offering Deadline, the Issuer shall send a notice five days prior to the Closing to all investors who have committed to invest in the Offering through a subscription agreement granting them an  opportunity to cancel their commitment up to forty-eight (48) hours prior to the Closing. This notice will also identify if the Issuer will continue to accept commitments up to the Closing.

(d)       The Offering may close in batches after the Offering Deadline as requirements are met for any such batch of subscribers.

4.           Payment for and Delivery of Securities. The Investor shall pay to the Issuer the Total Purchase Price at the time of entering into this Subscription Agreement. Investor may pay the Total Purchase Price by ACH, credit card, or wire transfer. Payment shall be submitted to the Escrow Agent and held by the Escrow Agent until such time that it is either refunded to the Investor or distributed to the Issuer. If payment is never received by the Escrow Agent, Investor’s subscription will be canceled. Once payment is received and accepted, the Investor will receive notice and evidence of the digital entry (or other manner of record) of the number of Securities owned by the Investor reflected on the books and records of the Issuer and verified by the Issuer’s transfer agent.

5.           Termination. The Issuer may terminate this Subscription Agreement at any time and for any reason up until the time that Investor’s subscription is accepted.

6.           Representations and Warranties of the Issuer. As of the Closing, the Issuer represents and warrants that:

(a)       The Issuer is duly formed and validly existing under the laws of the state of Delaware, with full power and authority to conduct its business as it is currently being conducted and to own its assets; and has secured any other authorizations, approvals, permits and orders required by law for the conduct by the Issuer of its business as it is currently being conducted.

(b)       This Subscription Agreement, when executed and delivered by the Issuer, shall constitute the valid and legally binding obligations of the Issuer, enforceable against the Issuer in accordance with their respective terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium,  fraudulent  conveyance, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally, or (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

(c)       The Securities, when issued, sold and delivered in accordance with the terms and for the consideration set forth in this Subscription Agreement and the Offering Documents, will be validly issued, fully paid and non-assessable.

7.           Representations
and Warranties of the Investor. The Investor hereby represents and warrants to and covenants with the Issuer that:

(a) The Investor has the capacity to purchase the Securities, enter into this subscription Agreement and to perform all the obligations required to be performed by the Investor hereunder, and such purchase will not contravene any law, rule or regulation binding on the Investor or any investment guideline or restriction applicable to the Investor.

(b)       The Investor is a resident of the state set forth on the signature page hereto and is not acquiring the Securities as a nominee or agent or otherwise for any other person.

(c)       The Investor is a citizen of the United States of America.

(d)       The Investor is at least eighteen (18) years of age.

(e)       The Investor will comply with all applicable laws and regulations in effect in any jurisdiction in which the Investor purchases or sells the Securities and obtain any consent, approval or permission required for such purchases or sales under the laws and regulations of any jurisdiction to which the Investor is subject or in which the Investor makes such purchases or sales, and the Issuer shall have no  responsibility therefor.

(f)       The Investor has received a copy of the Offering Documents. The Investor has not been furnished any offering literature other than the Offering Documents and has relied only on the information contained therein.

(g)       The Investor understands and accepts that the purchase of the Securities involves various risks, including the risks outlined in the Offering Documents. The Investor represents that it is able to bear any loss associated with an investment in the Securities.

(h)       The Investor confirms that it is not relying on any communication (written or oral) of the Issuer or any of its affiliates, as investment advice or as a  recommendation to purchase the Securities. It is understood that information and explanations related to the terms and conditions of the Securities provided in the Offering Documents or otherwise by the Issuer or any of its affiliates shall not be considered investment advice or a recommendation to purchase the Securities, and that neither the Issuer nor any of its affiliates is acting or has acted as an advisor to the Investor in deciding to invest in the Securities.

(i)       The Investor is familiar with the business and financial condition and operations of the Issuer, all as generally described in the Offering Documents. The Investor has had access to such information concerning the Issuer and the Securities as it deems necessary to enable it to make an informed investment decision concerning the purchase of the Securities.

(j)       The Investor understands that each of the Investor’s representations and warranties contained in this Subscription Agreement will be deemed to have been reaffirmed and confirmed as of the Closing, taking into account all information received by the Investor.

(k)       The Investor acknowledges that the Issuer has the right in its sole and absolute discretion to abandon Offering at any time prior to the completion of the offering. This Subscription Agreement shall thereafter have no force or effect and the Issuer shall return the previously paid Total Purchase Price of the Securities, without interest thereon, to the Investor.

(l)       The Investor understands that no federal or state agency has passed upon the merits or risks of an investment in the Securities or made any finding or determination concerning the fairness or advisability of this investment.

(m)       The Investor represents that it is not relying on (and will not at any time rely on) any communication (written or oral) of the Issuer, as investment advice or as a recommendation to purchase the Securities, it being understood that information and explanations related to the terms and conditions of the Securities and the other transaction documents that are described in the Offering Documents shall not be considered investment advice or a recommendation to purchase the Securities.

(n)       The Investor confirms that the Issuer has not (A) given any guarantee or representation as to the potential success, return, effect or benefit (either legal, regulatory, tax, financial, accounting or otherwise) of an investment in the Securities or (B) made any representation to the Investor regarding the legality of an  investment in the Securities under applicable legal investment or similar laws or regulations. In deciding to purchase the Securities, the Investor is not relying on the advice or recommendations of the Issuer and the Investor has made its own independent decision that the investment in the Securities is suitable and appropriate for the Investor.

(o)       The Investor has such knowledge, skill and experience in business, financial and investment matters that the Investor is capable of evaluating the merits and risks of an investment in the Securities. With the assistance of the Investor’s own professional advisors, to the extent that the Investor has deemed appropriate, the Investor has made its own legal, tax, accounting and financial evaluation of the merits and risks of an investment in the Securities and the consequences of this Subscription Agreement. The Investor has considered the suitability of the Securities as an investment in light of its own circumstances and financial condition and the Investor is able to bear the risks associated with an investment in the Securities.

(p)       The Investor is aware of its investment limitations based on Investor’s annual net income and net worth and is compliant with such limitations based on the Total Purchase Price.

(q)       The Investor is acquiring the Securities solely for the Investor’s own beneficial account, for investment purposes, and not with a view to, or for resale in connection with, any distribution of the Securities. The Investor understands that the Securities have not been registered under the Securities Act or any State Securities Laws by reason of specific exemptions under the provisions thereof which depend in part
upon the investment intent of the Investor and of the other representations made by the Investor in this Subscription Agreement. The Investor understands that the Issuer is relying upon the representations and agreements contained in this Subscription Agreement (and any supplemental information) for the purpose of determining whether this transaction meets the requirements for such exemptions.

(r)       The Investor understands that the Securities are “restricted securities” under applicable federal securities laws and that the Securities Act and the rules of the U.S. Securities and Exchange Commission (the “Commission”) provide in substance that the Investor may dispose of the Securities only pursuant to an effective registration statement under the Securities Act or an exemption therefrom, and the Investor understands that the Issuer has no obligation or intention to register any of the Securities, or to take action so as to permit sales pursuant to the Securities Act (including Rule 144 thereunder). Accordingly, the Investor understands that under the Commission’s rules, the Investor may dispose of the Securities principally only in “private placements” which are exempt from registration under the Securities Act, in which event the transferee will acquire “restricted securities” subject to the same limitations as in the hands of the Investor. Consequently, the Investor understands that the Investor must bear the economic risks of the investment in the Securities for an indefinite period of time.

(s)       The Investor agrees: (A) that the Investor will not sell, assign, pledge, give, transfer or otherwise dispose of the Securities or any interest therein, or make any offer or attempt to do any of the foregoing, except pursuant to a registration of the Securities under the Securities Act and all applicable State Securities Laws, or in a transaction which is exempt from the registration provisions of the Securities Act and all applicable State Securities Laws; and (B) that the Issuer and its affiliates shall not be required to give effect to any purported transfer of such Securities except upon compliance with the foregoing restrictions and any restrictions set forth in the Offering Documents.

8.           Conditions to Obligations of the Investor and the Issuer. The obligations of the Investor to purchase and pay for the Securities specified on the signature page and of the Issuer to sell the Securities are subject to the satisfaction at or prior to the Closing of the following conditions precedent: the representations and warranties of the Issuer contained in Section 6 hereof and of the Investor contained in Section 7 hereof shall be true and correct as of the Closing in all respects with the same effect as though such representations and warranties had been made as of the Closing.

9.           Obligations Irrevocable. The obligations of the Investor shall be irrevocable except with the consent of the Issuer, until the consummation or termination of the Offering.

10.         Waiver, Amendment. Once this Subscription Agreement has been accepted by both parties, neither this Subscription Agreement nor any provisions hereof shall
be modified, changed, discharged or terminated except by an instrument in writing, signed by the party against whom any waiver, change, discharge or termination is sought.

11.         Assignability.
Neither this Subscription Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by either the Issuer or the Investor without the prior written consent of the other party.

12.         Waiver of Jury Trial. THE INVESTOR IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF THE TRANSACTIONS CONTEMPLATED BY THIS SUBSCRIPTION AGREEMENT.

13.         Submission to Jurisdiction. With respect to any suit, action, or proceeding relating to any offers, purchases, or sales of the Securities by the Investor
(“Proceedings”), the Investor irrevocably submits to the jurisdiction of the federal or state chancery courts located in the County of , which submission shall be exclusive unless none of such courts has lawful  jurisdiction over such Proceedings.

14.         Governing Law. This Subscription Agreement shall be governed by and construed in accordance with the laws of the State of .

15.         Section and Other Headings. The section and other headings contained in this Subscription Agreement are for reference purposes only and shall
not affect the meaning or interpretation of this Subscription Agreement.

16.         Counterparts. This Subscription Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed
to be an original and all of which together shall be deemed to be one and the same agreement.

17.         Notices. All notices and other communications provided for herein shall be by email and shall be deemed to have been duly given on the day on which
the receiver received such email if sent prior to 5:00 PM in the receiver’s time and on the following business day if sent after 5:00 PM.

18.         Binding Effect. The provisions of this Subscription Agreement shall be binding upon and accrue to the benefit of the parties hereto and their respective
heirs, legal representatives, successors and assigns.

19.         Survival. All representations, warranties and covenants contained in this Subscription Agreement shall survive (i) the acceptance of the subscription by the Issuer and the Closing, (ii) changes in the transactions, documents and instruments described in the Offering Documents which are not material or which are to the benefit of the Investor and (iii) the death or disability of the Investor.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Investor has executed this Subscription Agreement on:

___________________,

Month Day, Year

INVESTOR:

By: _____________________

Signature

Name: __________________

Print

State or Territory, and Country of Domicile:

__________________________

Address of Investor:

_________________________

_________________________

Aggregate Subscription Amount: US$: ________________

The offer to purchase Securities as set forth above is confirmed
and accepted by the Issuer as to ____________________ units.

Date: ___________________

By: ____________________

Signature

Name: _________________

Print

Exhibit: 16,05