New FinTech Funding Alternatives For Life Science Companies

New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
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Our Presenter:
Scott Jordan,
CEO, S. Jordan Associates

Thursday, April 21, 2016
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Agenda

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Introduction Stephen Joseph

VP of Business Development,
ShareVault
Presentation Scott Jordan
CEO, S. Jordan Associates
Questions & Answers
Copyright 2016, ShareVault Inc. and S. Jordan Associates
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Logistics
The webinar will last 60 minutes
(until 12pm PDT / 3pm EDT / 7pm GMT).
Your audio is muted.
Contribute questions via the Q&A
GoToWebinar interface, and we will address
them at the end.
The webinar is being recorded, and we will
contact you when it becomes available.
We welcome your feedback on this webinar as
well as topic requests, so that we can provide
others of interest to you in the future.
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
This Webinar Is Hosted by ShareVault

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ShareVault is a full-featured, state-of-the-art

virtual data room that allows customers to
simply and securely share
sensitive documents in the cloud.
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Sample Transactions Using ShareVault

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New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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About Our Presenter, Scott Jordan

CEO of
(SJA),
a management consulting and investment
banking firm dedicated to:
ng
i
g
r
e
Em
h
Growt ,
ies
n
a
p
Com
e
d
i
S
l
Sel
Assisting early-stage/growth companies accelerate

therapeutic, medical device, and medtech
development programs via:
Business development (licensing)
Private placements and
Exits (M&A)
Empowering search and evaluation teams
source premium deal flow globally utilizing
Financial Technology (FinTECH)
Large
BioPha
rma,
MedTEC
H,
Medica
l Devic
es,
Sell S
ide
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Scott Jordans Background

Over 25+ years of experience:

Negotiating strategic corporate alliances

Securing international licensing agreements
Building national sales teams
Contributing to successful product development,
approval, and launch
Cross-functional experience with former leadership roles in:

Sales & marketing

Licensing
Finance
Business Development
Level II Candidate in the Chartered Financial Analyst (CFA) Program and holds
Series 7, 66, 63 & 31 Certifications
Adviser to the worlds leading online investment platform sponsored by a stock exchange
(Singapore, SGX), and venture capital firm (Clearbridge Accelerator): CapBridge
Founder of Healthios investment marketplace, HealthiosXchange, http://www.healthiosxchange.
com/ ; raised over $150 million for private emerging growth healthcare companies from 2013-2015
Has helped numerous companies raise capital, secure licensing agreements and find acquirers,
including Calibra Medical, Nippon Kayaku, NeoPharm, and more.
7
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
FinTECH (Financial Technology)

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>3,300 members Accredited Investors,

Early- Stage/Growth Company Executives,
Investment Professionals, Strategic Buyers
The Worlds Premier

Direct Investing Platform
Launch
ing
May 26
1,500 healthcare companies in

46 Market Sectors Seeking Licensing
Partners, Financings, and/or Exits
Sponsored by:
The Singapore Stock Exchange (SGX)
Venture Capital Firm, Clearbridge Accelerator
HealthiosXchange
Sponsors S. Jordan Associates and

Healthios, Chicago-Based Healthcare
Investment Bank
SGX - Raise, Capital for Small-Medium Size

Enterprises (SME), Fund Allocation, Shares
depository (IPO On Ramp)
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
HealthiosXchange Membership Geographic Distribution
45%

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48
809
229
29
148
62
39
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
What SJA Can Do for You

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Business
Development
Partner with SJA Execute Licensing

Agreements
with Large
BioPharma,
Medical Devices,
HIT Companies
Hire SJA as Your

Internal
Investment
Banking Team
Acquiring
Products/
Companies
Strategic
Advisory
Collaborate with
SJA and Healthios
Sourcing Capital From
Institutional and
Alternative Investors
Private Placements
10
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
JOBS Act (Jumpstart Our Business Startups)
45%

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Intended to Encourage Funding of United States Small Businesses

by Easing Securities Regulations
Passed with Bipartisan Support and was Signed Into Law

by President Barack Obama on April 5, 2012
The JOBS Act Substantially Changed a Number of Laws and Regulations
Making it Easier for Companies to Both Go Public and to Raise Capital Privately
and Stay Private Longer
Major Provisions:
Relieve Emerging Growth Companies from Certain Regulatory and Disclosure Requirements in
Registration Statement When Going Public
Lift the Ban on General Solicitation and Advertising in Specific Kinds of Private Placement of
Securities
Increase the Number of Shareholders Before a Company Has to Register with SEC and Become a
Publicly Reporting Company from 500 to 2,000 Total Shareholders
Allow Equity Crowdfunding (Non-Accredited Investors)
Raise the Limit for Securities Offerings Exempted under Regulation A from $5 to $50M (Tier II)
11
New
FinTech Funding
Alternatives
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Companies
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30%
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Titles of the JOBS Act

Title I
Reopening American Capital Markets To

Emerging Growth Companies
Title II Access To Capital For Job Creators

Title III Crowdfunding
Title IV Small Company Capital Formation
Title V Private Company Flexibility And Growth
Title VI Captal Expansion
Title VII Outreach On Changes To The Law Or Commission
12
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Summary 1 of Titles I, II and III

JOBS Act
Title I
JOBS Act
Title II
JOBS Act
Title III
Approval Date
09/2013
09/2013
10/2015 (Effective 05/2016)
Description
Making IPOs Easier
Reg D 506 (c) Private Placements
Crowdfunding

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Value Propositions
Testing the Waters Lifted Ban on General

Confidential
Solicitation Marketing:
Registration
Social Media Online
Due Diligence /
Statement
Investment
Raise up to $1M in 12-Month Period

Reviewed Financials: Capital Raise
$100K><$500K
General Solicitation - w/Limitations
Impact
Doubled Biotech
IPOs from 2013-14
>$1 Billion Raised
TBD
Security
Public Equity
Private Equity
Private Equity
Investor Type
Non/Accredited
Accredited
Non-Accredited
Investor $ Limits
None
None
Invest Greater of $2,000 or 5%

of the Lesser of Annual Income or Net Worth
Invest Lesser of $100,000 or 10%
of the Lesser of Annual Income or Net Worth
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New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Summary 1 of Title IV, Tiers 1 and 2

JOBS Act
Title IV, Tier 1
JOBS Act
Title IV, Tier 2
Approval Date
03/2015 (Effective 06/2015)
03/2015 (Effective 06/2015)
Description
Reg A+
Reg A+
Value Propositions
Raise up to $20M in 12 Months

Reviewed Financials
General Solicitation
Raise up to $50M in 12 Months

State Pre-Emption
Impact
~Community Banks
Selling Stock Intrastate
(Aperion Biologics, BeautyKind)

Underwriter WR Hambrecht

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83 Reg A+ Offerings Filed
14
Security
Private/Public Equity
Private/Public Equity
Investor Type
Non/Accredited
Non/Accredited
Investor $ Limits
None
Non-Accredited:
Greater of up to 10% of
Annual Income or Net Worth
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Summary 2 of Titles I, II and III

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JOBS Act
Title I
Making IPOs Easier
JOBS Act
Title II
Reg D 506 (c) General Solicitation
JOBS Act
Title III
Crowdfunding
Projected $ Raise
Unlimited
$1-2M
<$500K
Cost
~$3.0M (Nasdaq)
~$1.5M (SGX)
Accounting/Legal:
$10,000+
Accounting/Legal:
$10,000+
Company Stage
Late Stage
Early - Late Stage
Early Stage
Exchange/
FinTECH
Platforms
Catalist/Singapore Stock
Exchange (SGX)
OTC, Nasdaq
NYSE
AngelList,
AngelMD,
Crowdfunder,
Healthfundr,
HealthiosXchange
Crowdfunder,
Onevest,
RocketHub
SJA Services
Go Public on SGX
Company Listing /
Offering on Capbridge
TBD
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Summary 2 of Titles IV, Tiers 1 and 2

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JOBS Act
Title IV, Tier 1
Reg A+, Mini-IPO
JOBS Act
Title IV, Tier 2
Reg A+, Mini-IPO
Projected $ Raise
<=$20M
<=$50M
Cost
~$500K
~$1M
Company Stage
Mid - Late Stage
Mid - Late Stage
FinTECH Platform
StartEngine, Banq
StartEngine, Banq
Investor $ Limits
None
None
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Is the JOBS Act Important for the Life Sciences Sector?

Early Life Science Investors
Early
Life Science
Investors

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With only ~100 new biotech startups being formed each year, and only a few dozen
firms actively doing it, theres a tiny universe of players responsible for creating the
next wave of biotech's likely to mature in the second half of this decade.
By contrast, the last few years even with one of

the biggest/longest IPO windows in biotech history
have been defined by restraint and constraint in
terms of early-stage biotech venture and startup
formation.
250
Number of Investors
... the difference between then (1998-2002) and

now (2009-2013): in 2000, the number of earlystage investors spiked 75% as the IPO window for
biotech began to open up, and stayed high through
the collapse of the bubble in 2012.
Then Vs. Now: First/Seed Round BioPharma Investors
200
150
1998-2002
2009-2013
100
50
0
1998 / 2009
1999 / 2010
2000 / 2011
2001 / 2012
2002 / 2013
Bruce Booth Early Stage Biotech Venture Scarcity: Fitness, Fear, and Greed, Forbes, 9/22/14
Data: Dow Jones Venture Source, Franklin Park Associates, NVCA
17
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Active Life Science Investors
Active
Life Science
Investors

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Number of Active Investors

Investing >$50M per Year
400
350
Number of Investors
Active life science investor numbers (including

BioPharma and MedTech) dropped by 25% since
2007, and havent rebounded...FLAG Capital
Management did a further refinement of active
investors filtering for only investors that had made
at least four new investments with at least $4M
in aggregate during 2013, they identified only ~25
active healthcare venture capital investors, and
only a subset of those VCs actually help start or
back drug discovery and research stage biotechs
probably only a dozen firms regularly start or fund
more than 4-6 new biotech companies a year.
300
250
LS Investors
Non-LS
Investors
200
150
100
50
0
2007
2008
2009
2010
2011
2012
2013
Data: Dow Jones Venture Source, Franklin Park Associates, NVCA Yearbook 2014, Figure 1.05
18
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Life Science Investors
Life Science
Investors

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Investors participating in BioPharma venture deals declined by ~40%, and

never recovered those numbers. This represents a major culling of the herd.
Total Venture Round Investors
Total Number of Investors
1,200
600
1,000
500
800
400
600
300
400
200
200
100
2007
2008
2009
2010
2011
Total First/Seed Round Investors
2012
2013
BioPharma
IT
2007
2008
2009
2010
2011
2012
2013
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New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Venture Capital
Venture
Capital

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Venture Capital Fundraising

30.0
25.0
$, Billions
The take home message from these

data is clear: theres a huge influx
of capital into venture, mostly into
technology, and there remains a
limited pool of capital flowing into life
science venture, and even smaller into
early-stage funds despite the IPO
and M&A markets.
20.0
Life Science
Non-LS Venture (Tech)
15.0
10.0
5.0
0.0
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
20

Crossover Investors (1)
New
FinTech Funding
Alternatives
for Life Science
Companies
In the past two years, we have seen the emergence of non-VC investors, particularly
hedge funds, providing top-up financing to IPO-ready companies prior to entering
the market.
Jonathan Norris, Kristina Peralta,

Number of Later Rounds
140
Later Rounds* of Financing in VC-Backed Biotech

Quarterly Datapoints and 3Q Rolling Average
$2.00
120
$1.60
100
$1.40
$1.20
80
$1.00
60
$0.80
40
$0.60
$0.40
20
4Q14
2Q14
4Q13
2Q13
4Q12
2Q12
4Q11
2Q11
4Q10
2Q10
4Q09
2Q09
4Q08
2Q08
4Q07
2Q07
$0.00
4Q06
4Q14
2Q14
4Q13
2Q13
4Q12
2Q12
4Q11
4Q09
2Q09
4Q08
2Q08
4Q07
2Q07
4Q06
2Q06
$0.20
4Q05
Later Rounds of Funding ($B)
$1.80
2Q05
The later-stage
financings that have
been driving up the
aggregate numbers
are almost without
exception driven by
crossover investors
(like hedge funds
and mutual funds
who typically invest
in public companies)
or non-traditional
partners like financial
institutions. For
example, The Alaska
Permanent Fund put
nearly $300M into
Juno Therapeutics
during their private
round.
Trends in Healthcare Investments and Exits 2015, Silicon Valley Bank (SVB)
2Q06
4Q05
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2Q05
2Q11
4Q10
30%
2Q10
45%
100%
45%
Crossover
Investors
1
Data: Data Snapshot: Venture-Backed Biotech Financing Riding High, Forbes, 4/21/15
*Later Rounds of Financing defined as any financing that are not First Financings.
21

New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Crossover
Investors
2

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VC-Backed Biotech Funding - 10 Year View

Quarterly Datapoints and 3Q Rolling Average
180
$2.00
140
120
$1.50
100
80
$1.00
60
40
4Q14
2Q14
4Q13
2Q13
4Q12
2Q12
4Q11
2Q11
4Q10
2Q10
4Q09
2Q09
4Q08
2Q08
4Q07
2Q07
4Q06
2Q06
4Q05
4Q14
2Q14
4Q13
2Q13
4Q12
2Q12
4Q11
2Q11
4Q10
2Q10
4Q09
2Q09
4Q08
2Q08
4Q07
2Q07
4Q06
2Q06
4Q05
$0.00
2Q05
$0.50
20
0
Funding ($B)
$2.50
160
2Q05
My estimate, based
on discussions with a
few bankers who track
crossover activity,
and an appreciation
of Corporate Venture
Capital (CVC)
contributions, is that
only around 50% of
the $6B invested in
private biotechs came
from conventional
venture investors
(meaning
independent venture
firms backed by
groups of LPs).
Number of Financings
Data: Data Snapshot: Venture-Backed Biotech Financing Riding High, Forbes, 4/21/15
*Later Rounds of Financing defined as any financing that are not First Financings.
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New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Crossover
Investors
3

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Companies with Cross-Over Led

Pre-IPO Financing Rounds Have:
Significantly higher pre-money valuations at
IPO (128% higher valuation - $290M vs. 127M)
Cross-over support IPOs at bigger step-ups
in price at IPO (multiple over the last private
round valuation is 34% higher)
Post-IPO stock appreciation vastly outperforms
for companies with cross-overs in their pre-IPO
round (83% stock appreciation, at the median,
versus trading down by 10% without crossovers)
Pre-Money
IPO Valuation
($, Millions)
450
400
350
300
250
200
150
100
50
0
With
Without
Crossover Crossover
Investors Investors
Step-Up Multiple from

Last Round Into the
IPO Valuation
2.0x
1.8x
1.6x
1.4x
1.2x
1.0x
0.8x
0.6x
0.4x
0.2x
0
With
Without
Crossover Crossover
Investors Investors
140%
120%
100%
80%
60%
40%
20%
0%
-20%
-40%
-60%
Post-IPO Stock
Performance
(% Change)
With
Without
Crossover Crossover
Investors Investors
Bruce Booth, The Biotech Cross-Over Phenom: Biomarker of Quality? Forbes, 11/7/14
Data: Jonathan Norris, Kristina Peralta, Trends in Healthcare Investment and Exits 2015, Silicon Valley Bank (SVB)
Ranges represent 25th and 75th percentiles areound the median value (50th percentile)
N=24 companies with cross-over investor led pre-IPO financings, and 70 companies without Data as of October 20, 2014.
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New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Crossover
Investors
4

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Exhibit 13 Most Active* New Non-VC Investors (2013-2014)

12
10
8
6
4
Biopharma
Device
se
tM
gm
Se
cto
ra
l
As
en
tM
stm
rI
nv
e
As
on
Sa
tte
gm
tes
cia
so
Ca
pit
nn
is
Je
Br
oo
ks
ide
tn
Pa
r
in
Sp
Top
al
ers
l
ita
yC
ap
Sa
re
ca
bb
Ro
y
alt
y
rs
iso
He
a
lth
eA
dv
mt
tiv
Pe
rc
ep
ing
ton
Mg
p
rou
le
G
We
ll
Re
d
mi
Mg
mt
ita
l
ing
Ca
p
Ad
ag
e
Ro
ck
Sp
r
rfi
eld
De
e
ap
ita
l
Ra
C
# of Deals
Everyone in venturebacked emerging companies

acknowledges that going into
the public markets with a
solid list of blue chip crossover investors in the capital
structure is a good idea
conceptually. It makes sense
to line up big future owners of
the stock early to help support
the book-building process in the
offering.
Dx/Tools
Jonathan Norris, Kristina Peralta, Trends in Healthcare Investment and Exits 2015, Silicon Valley Bank (SVB)
24
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Can the JOBS Act Increase Access to

Capital Including Alternative Investors
(~Accredited, Family Office, Cross-Over
Investors, LPs on a Direct Basis)?
25
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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JOBS Act
Equity Crowdfunding: $1.08BLN in 2015
Market Volume in Americas by Alternative Finance Model 2013-2015 ($USD)
Equity-Based Crowdfunding:
168% Growth Rate (2013-2015)
2015: $598.05M
2014: $271.95M
2013: $86.29M
Proportion of Total Funding by Institutional Investors
Real Estate:
231% Growth Rate (2013-2015)
2015: $483.77M
2014: $138.15M
2013: $44.30M
Real Estate Dominates Online Equity
4.68%
Average Fundraising Size

$963K
26
New
FinTech Funding
Alternatives
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Companies
45%
100%
30%
45%

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Title II - Reg D 506 (c)

Advertising ~Social Media
Reach Alternative Investors
Reg D Market = $1.2 Trillion

Only 6% of 8.7 Million Accredited Investors Have Made a Private Equity
Investment in U.S.
Of These 500,000 Investors, Only 10% Participate Online (~Portals)
Of the 50,000 Participating Online, Only 10% Made an Investment or
5,000 Investors
Bruce Booth - Atlas Ventures (Forbes)
120M Households in the U.S.
Top 1% (~1M Households) Have a Mean Household Net Worth Near $15M
Invested Just 0.01% of Their Net Worth Each Year or $15K Into Crowdfunded
Life Science Companies, Would Create $15B of Fund Flows Into Biotech
This is 3x More Than the Total Biotech Venture Capital Market (2013)
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FinTech Funding
Alternatives
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Companies
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100%
30%
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The Investment Process
Market to Prospective Investors
via General Solicitation
(email, Social Media, Online Ads)
Escrow is Broken and Proceeds

Sent to Company Minus Fees to
Portal
(Success/Listing Fees)
ve
i
t
a
n
Alter ors
t
s
e
v
n
I
ed
t
i
d
e
Accr
28
Investment Capital Transferred

into Escrow
Prospects Review Offering on

Funding Portal and Perform Due
Diligence
Indications of Interest,
Investment Confirmations
Received
Portal Performs AML, KYC, and

Verifies Accredited Status of
Investors
Portal
Market
Sector
# of
Investors
FundersClub
Technology
16,000
FundRise
Real Estate
80,000
HealthiosXchange
Healthcare
3,500
SeedInvest
Technology
6,500
Crosso
ver
Investo
rs
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Online Portals - Track Record

Portal
Market Sector
$s Raised on Portal
(Since Inception)
Investors Backing Portal
AngelList
Technology
$163M (2015)
Google Ventures
Capbridge
All Sectors
Launching, Summer 2016
SGX, Clearbridge Accelerator
CircleUp
Consumer Goods
$193M
Union Square Ventures,

Canaan
FundersClub
Technology
$55M
Andreesen Horowitz, DFJ
HealthiosXchange*
Healthcare
$150M
None
RealtyMogul
Real Estate
$200M
Canaan

*Includes syndication and co-investing from institutional investors
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New
FinTech Funding
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Companies
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30%
45%

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Title III - Crowdfunding
Opportunities & Constraints

Investment Limits
Opportunities
Constraints
Parallel Offerings Allowed Including

506, Reg A+, S-1
Issuer May Raise Only $1M During Any Rolling

12-Month Period (Applies to Affiliates as Well)
Limits on Investors
Annual Income <$100k: > of $2,000 or 5% of

Lesser (Annual Income, Net Worth)
Annual Income <$100k: < of $100,000 or 10%
of Lesser (Annual Income, Net Worth)
Limits on Issuer
Issuer Must be Organized in U.S.

Issuer May Not be a Public Reporting or
Investment Company
Limits on Advertising
Intermediary Can Advertise Itself and

Present Issuer Offerings
Issuer Seeking to Raise Capital Must List on

Qualified Portal
Offering Must be Conducted Only On One
Portal
Qualified Portal
Intermediary
Offering Disclosure
Requirements
SEC Approval not Required
Form C: Issuer Required to Make Extensive

Disclosures
Financial Information
Raising <$100K: Financial Statements

Certified by Issuer; $100k><$500:
Reviewed
Raising >$500K: Audited Financials
Shareholder Limits
Investors Dont Count Toward 2,000

Total or 500 Non-Accredited
Shares Restricted
30
Issuer May Not (Except at Portal) Advertise

the Details of Offering
Yes, 1 Year
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Sample Portals
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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32

Reasons to Use/Not Use
Why Use Title III?
Why Not Use Title III?
Raise Capital from Non-Accredited

Investors
Only Need Capital and Nothing Else, Easier

Time Raising Capital from Accredited
Investors Using Title II (Reg D)
Less Disclosure Requirements
More Flexibility General Solicitation
Attract Affinity Investors

Company Needs $350k for Patents on a
New Heart Valve
Via a Social Media Campaign, Company
Might Identify Thousands of Potential
Investors from Those Affected by Heart
Disease
If Company Requires Larger Amounts of

Capital from Non-Accredited Investors,
Use Title IV
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Title IV - Reg A+
Comparison to Title I

Lorem ipsum
JOBS Act legislation

makes it easier for
small, innovative
companies to
Go Public at lower
costs by widening
the investor base
to include nonaccredited investors
and the ability to
reach investors via
general solicitation.
33
Title I - Initial Public Offerings (IPOs)

Emerging Growth Company,
<$1BLN in Sales
5-Year Grace Period
Reporting Under Federal Law
Reduced Financial Disclosures:
Only 2 years of Audited Financial
Statements
Reduced Managements Discussion
and Analysis of Financial Condition
Not required to comply with Section
404 of Sarbanes-Oxley Act
Testing the Waters Allowed Before
Registration as Long as No Funds
Accepted
Tier 1 Fueled Biotech IPO Activity
Biotech IPOs < JOBS Act (Previous 2
Years, 2011 - 2012): 32
Biotech IPOs > JOBS Act (Following
2 Years, 2013 2015): 80
Title IV - Reg A+ (Mini IPO)

Tier 2
Allow Testing the Waters to Determine Investor Appetite
Enables Use of Public Channels (Email, Social Media) to Market under General
Solicitation
Raise Up to $50M in a Calendar Year
Only 2 Years of Audited Statements
State Pre-Emption (Avoid Blue Sky Laws)
Access to Non-Accredited Investors
Lower Filing and Underwriting Costs than Under Traditional IPO
Only Prepare a Six-Month Interim Report vs. Quarterly Reports for Registered Issuers
Smaller Amounts Can Be Taken From a Larger Number of Investors Without

Triggering 34 Act Reporting
No requirements to Involve FINRAApproved Underwriter or BDs
(~ELIO Motors)
Reg A+ Filings to Date
Securities Tradable Immediately
83 Reg A+ Filings
(Unrestricted) Providing Liquidity to
>50% (Tier II): Size of Offerings
Investors and Owners
($50M) and State Preemption
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Title IV - Reg A+
Opens Paths to Financing for US/Canadian Companies
Benefits Those Companies That:

Are Too Large for Angel/VC Funding
Are Too Small for Traditional IPOs
Wish to Avoid Negative Connotations of
Reverse Mergers
Desire to Get Used to Reporting Before
Uplifting to a National Exchange and
Becoming a Fully Reporting Company
Desire to File Confidentially, Providing
SEC an Opportunity to Review Offering
Statement w/o General Public Knowing
Allows Issuers to:

Raise Money From Non/Accredited Investors
Raise Capital Faster and less Expensively than
Traditional Methods
Allows test the Waters Period to Determine
Investor Appetite
Create Immediate Liquidity, Non-Restrictive
Shares for Shareholders and New Investors
Reduce Filing and Compliance Requirements
Exempt from SEC Registration Requirements
12 (g)
Public Float < $75M, Annual Revenues < $50M
34
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Title IV - Reg A+
Comparison to Traditional Way of Going Public
Traditionally
Going Pubic was
very expensive
and geared
towards laterstage companies
given high upfront/
maintenance costs
and restrictive
listing requirement.
Traditional IPO Has High Upfront and

Maintenance Costs:
Upfront Costs:
Accounting Fees, Legal Fees, Professional
Advisor Fees, Filing Fees, Financing
or Placement Fees, Exchange Fees,
Management Meetings, Conference Calls,
Roadshows, Marketing Expenses
Maintenance Costs:
Director and Officer Insurance, Accounting,
Legal, Board Compensation, SEC Filing
t
s
o
Costs (10-Ks, 10-Qs), Financial Marketing
C
e
g
a
r
e
:
v
c
A
Costs (Analysts, Market Makers, PR),
i
l
b
u
P
o
G
Corporate Governance Setup and
to
M
~$3
Maintenance Costs
35
Traditional IPO Has Restrictive Listing

Standards and Requirements:
#1: Earnings
#2: Capitalization w/Cash Flow
#3: Capitalization w/ Revenue
#4: Assets w/Equity
#5: Liquidity: # of Shareholders
Listin
g:
$125
$25K K Entry +
Appl
icati
on
Fee
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Title IV - Reg A+
Costs and Listing Requirements
Sma
ll Cap
IPOs
Via Reg A+ smaller

companies can Go
Public without
an underwriter
(lower costs), more
easily meet listing
requirements, and
simultaneously
raise capital and
list on a public
exchange - OTCQX
(highest ranking
OTC level)
36
Lower Filing Costs and

Ongoing Reporting Requirements:
Less Restrictive Listing Requirements:
Tier 1: <$500K, Tier 2: <$1.0M
Go Public Earlier
SEC Filing Process
File 1-A, Offering Circular,

Subscription Agreements
Raise Smaller IPO <$50M Accredited Investors,

From Alternative Investors Family Offices, LPs
Offering Process
Transfer Agent, Blue Sky Filings,

Escrow
Designated Advisor for

Disclosure (DAD)
Pre-Deal/Marketing
Auditing, Testing the Waters,

Deal Marketing, Solicitation of
Interest
Reg A+ Eligible via

Professional Third-Party
Advisor Sponsorship
Post-Offering
Shareholder/Trading
Shareholder Records, Electronic

Trading, Brokerage Accounts
Liquidity for Shareholders

(Trade Shares post-IPO),
FINRA Rule 5110
Acquire Issuer Securities

During 180-day Review
Period w/o Securities
Deemed Underwriting
Compensation
Exchange
FINRA 15c2-11, Listing Fee

OTCQX OTC Quotation
Post-Offering
Shareholder/Trading
Shareholder Records,
Electronic Trading,
Brokerage Accounts
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Title IV - Reg A+, Tier 2 - Crowdfunding

Tier 2 Advantages
Reg A+
Crowdfunding
enables smaller/
innovative
companies to Go
Public by Testing
the Waters with
customers who are
passionate about
investing (ELIO
Electric Cars).
37
Advantages for Investors
Advantages for Companies
Access to Pre-IPO Companies
Assess Demand via Testing the Waters

and Confidentially File w/SEC
Emotional Quotient, Customers Eager to

Support Companies They Believe In
Sell Equity to Customers Passionate

About Company
Existing Shareholders Sell up to $15M

in the Offering (No More than 30% of
Aggregate Offering Price)
Non-Accredited Investment Minimums

Higher than Crowdfunding; > of 10% of
Income or Net Worth
No Holding Period for Existing

Shareholders (Unrestricted)
Raise Capital and Simultaneously List on

Stock Exchange: OTCQX, NASDAQ
Lower Costs vs. Traditional IPOs and Less
Punitive than PIPES
(Warrant Coverage)
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Lorem ipsum

First Crowd-Funded IPO
ELIO leveraged
Reg A+, Tier 2, to
raise $17M from
customers (prebought electric car)
Elio Motors
Phoenix, AZ
www.eliomotors.com
Ultra-High Mileage,
Low-Cost,
Three-Wheeled Vehicle
Benefits
Indications of Interest
Fun-to-Drive
50,414 reservations
Super-economical: 84mpg
Affordable: $6,800
Safe:
3 airbags
Reinforced roll-cage frame
Anti-lock braking system
50% larger crush zones
Customers as Equity Shareholders

Reg A+ Offering Raise Capital,
Simultaneous OTCQX Listing
Completed Offering Using Internet Portal
and General Advertising/Video/Social
Media as Marketing Vehicles
Environmentally friendly
Creates American jobs
38
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Reward Crowdfunding
Build Customer Base, Pre-Sales
50,414 Reservations @$6,800 = $342M Pre-Sold
Pre-Reg A+
Filing
Post-Reg
A+ Filing
After-Market/
Trading
$240M
Market Cap
>$500M
Market Cap
Trading Volume:
~8,000 shares/day
$70M
of Capital Raised
$17M
Raised
Average Transaction
Size: 250 Shares
Friend and
Family/Insiders
Retail
Investors
Small Float:
1.41M vs. 26.5
Shares Outstanding
Stock Volatility:
$12 $40 ~$20
39
Sell Equity To Customers under Reg A+, Tier 2
Capital Markets Advisor

Designated Advisor for
Disclosure (DAD)
Professional Guidance on
OTCQX, US Security Laws,
Corporate Finance Strategy
IPO Awareness Creation Event:

Tested the Waters - Confidential Filings
$46M Indications of Interest from
12,000 Prospective Investors
Stock Offering Conducted over Six Weeks
6,400 Investors (58% Existing
Customers)
1.41M Shares Sold @ $12/Share
$17M of Equity Raised
$2,800/Investor
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Elio 8-Month Listing Process
Testing the Waters
Confidential Filings
Preliminary Offering
Circular Provided
to Non/Accredited
Investors
Filed Offering Statement (Form

1-A), SEC Comments,
SEC Amended Filing,
Notice of Qualification
Allowed w/
Disclosure Document
> Qualification
Filed 8-A (Exchange Act

Listing on Exchange),
and15c2-11 for Exchange
Quotation - (OTCQX)
Investors Proceed to
Campaign Page to
Review Marketing/
Offering Materials
Filed DTC Enables Electronic

Trading/Transfer of Securities
to Brokerage Accounts
Secured
$45M
Indications
of Interest
Non-Binding
Filed Manual Listing Exemption

Exempt from Blue Sky if:
Shares Purchased on
Unsolicited Basis on OTCQX
No Research Issued
40
Back Office
January 2016
July 2015
Solicitation and Road
Shows Allowed < 1-A
Filing, Rule 254 (a)
Marketing
Trading
After-Market Support
Ongoing Reporting
Up list to NASDAQ?
March 2016
Investors
Complete Sub
Docs, Transfer
& KYC, AML
Completed
Escrow Agent
Releases Funds
to Issuer and #
of Investors To
Transfer Agent
Transfer
Agent Creates
Certificates,
Either Sends to
Individual, Book
Entry, or Brokerage
When Shares
Listed, Investor
Executes
Trades in
Market
Low Trading Volume

Due to Lack of
Institution Capital/
Research Coverage
Current Reports, 1-U

Semi-Annual, 1-SA
Annual Reports, 1-K
$17M
Raise
d
Shares Deposited
in Brokerage
Accounts
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Going Public Without an Underwriter
ELIO utilized online

platforms (Internet)
to raise capital and
list on the OTCQX.
Marketing Engine
Portal Orders Taken
Back Office
Stock Transfer
OTC Markets, ELIO.QX
ELIO Paid $200K to

CrowdfundX - Marketing
Generated Interest on
Startengine
Process $s Into Escrow/

Background Checks
Transfer Stock into

Brokerage Accounts
Stock Exchange
Branding & Advertising
Online Portal
Facilitate Stock Transfer
Stock Exchange (OTCQX)
41
Crowdfunding Strategy
Crowdfunding Design
Social Media Marketing
Influencer Marketing
Public Relations
Digital Media Buying
Collateral Design
Website Design
Print/Digital Design
Video Production
Photography
Deal Hosting/
Company Page
Front-End Offering
Marketing and
Disclosure Displays
Investor Workflows
Transactions
Online Portal
Escrow and ACH
AML (Anti-Money
Laundering)
Broker Dealer Services
Accredited Investor
Confirmations
Payment Processing
Registered Transfer
Agent
eSign
Investor Management
Video Production
Photography
Companies with 500

Non-Accredited Holders
or 2,000 Total Record
Holders Must Engage
Services of Transfer
Agent Registered with
SEC
Establish Trading and
DTC Eligibility
Closing the Offering
Issuance of Securities
and Delivery to
Brokerage Accounts
Brokers Accepting
Shares:
Wells Fargo
BofA
Schwab
Merrill Lynch
E*Trade
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Uplisting from OTC to NASDAQ
OTCQX is a bridge
to a national stock
exchange listing
(NASDAQ).
42
OTCQX Listings
OTCQX Activity Metrics
Up list to National Stock Exchange
OTCQX
OTCQX
OTCQX Global Leader in Exchange Graduates
In 2015, Introduced New OTCQX

Rules to Strengthen Financial
Standards and Corporate
Governance Standards
489 Securities (27% Increase
YoY)
$1.4tn Market Cap (Up 4%)
$41.9bn Annual Volume (Up 16%)
Regulation A Reporting Standards
Introduced for OTCQX to Assist
Companies Go Public
14 Million Visits in 2015 (up 11.5% YoY)

23k News Releases (up 40%)
7,100 Financial Reports (up 2.6%)
580 Videos and Presentations (up 195%)
Companies from 8 Countries Joined
QTCQX
Sixty (60) U.S. and Global Companies

Graduated from OTC to a National Securities
Exchange in 2015
47 of Which Came From the QTCQX and QTCQB
Healthcare Companies: Cynapsus Therapeutics
(CYNA), CRH Medical (CRHM), Xtant Medical
Holdings (XTNT), Anavex Life Sciences (AVXL)
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Customer and IPO Allocations
Applicable to
Healthcare
Companies w/
Existing Customers
(Healthcare
Information
Technology, HIT);
Biotech?
Web and social media platform for public

companies to sell their customer stock
ownership plans directly to customers
Received $59M in Commitments From

Customers as Part of $427M IPO
Allocated 50% of $1.8 Billion IPO to Dealers

and Employees
43
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Opportunities for a Public Listing
Opportunity for Customers, Accredited and Non-Accredited Investors

to Participate in Pre/IPO Process
Issues can leverage
Reg A+ to expand
investor base.
Public Listing Provides Liquidity to Existing and New Shareholders

(Unrestricted Shares)
Public Listing Broadens Investor Base Including Alternative Capital
Sources Seeking Liquidity Option (~Family Offices)
>$500M Post-Money Valuation Could Attract Micro/Small-Cap BuySide Investors
44
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Challenges
Challenges exist for

companies seeking
to offer shares via
Reg A+ pre/post
transaction.
No Placement Agents (Underwriters) and

Limited Market Makers (One Required for OTC
Listing) Makes Securing Institutional Investors
Challenging
Difficult to Attract Research Coverage for
Companies with <$300M in Post-Money
Valuation (~Market Cap)
Low Trading Volumes Associated with Lack of
Research, Small IPOs/Public Floats, Results in
Lack of Institutional Capital Participation
Hedge Funds/Crossover Investors Reluctant
to Participate Given Post Reg A+ Low Trading
Volumes (Difficult to exit)
Challenges of Crowdfunding:
1. Institutional Capital Participation
2. Low Trading Volumes Participation
3. Broker Dealer Resistance to Accepting Reg A+

Securities Given:
Unfamiliar with Reg A+
More Broker Dealer Liability if Accept
Unregistered Shares/Illegal Distribution (OTC)
Financial Industry Reg Authority Notice 0905 (2009)
Brokerage Firm Obligations in the Resale of
Restricted Securities Include Determining if
Securities Eligible for Sale
Broker Dealers Accepting Shares May Charge
Large Deposit Fees up to $1,000
Small Appetite from VCs to Participate

(Preference for Illiquidity, not SEC 34 Exempt
Cant Own Public Stocks)
45
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Underwriter

Lorem ipsum
Advantages for Companies
Aperion Biologics is
pursuing a Reg A+
offering utilizing an
underwriter (WR
Hambrecht) with
established distribution
networks (selling groups
like broker dealers)
to raise capital from
investors.
Reg A+ enables
companies to widen
their investor base
(~institutional)
including those who
seek the flexibility to
sell post-close (Hedge
Funds) given stock is
unrestricted.
46
Advantages for Alternative Investors
1. Go Public at Lower Costs

<$1M Per IPO
Lower Marketing, Legal, Filing Costs
More Capital Available for Development Programs
2. Test the Waters via General Solicitation
Assess Investor Interest < Spending Larger Amounts
of Capital
3. Widened Pool of Investors

Venture Capitalists?
Crossover Investors,
Hedge Funds?
Selling Groups
VCs Not Subject to 34

Act (Invest in
Public Securities)
Liquidity > IPO
WR Hambrecht
Advisor
Underwriter
Sign WHR+Cos Master
Selected Dealer
Agreement, Support w/
Internet Marketing, Due
Diligence
Venture Preference is
for Illiquidity Obligated
to Distribute $s to LPs
Show Clients Unique, Upon Liquidity Event
1. Gain Access to Pre-IPO Companies

First Come, First Served Basis
Syndicate Groups (Brokers)
Add Value to Clients
Institutional Investors (LPs)
Participate on Direct Basis Lower
Costs
2. Easier to Sell Shares

Faster Exit for New Investors Unrestricted Securities
Faster Exit for

Sell Shares and
Existing Investors
Reinvest In
- Higher $ Limits
Company vs.
Raise More $s
High Potential
New Issues
(~Broker Dealers)
Market Offerings to
Retail and Institutional
Investors via General
Solicitation
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Underwriter

Lorem ipsum
WR Hambrecht assisting
Aperion with listing on
the NASDAQ via Reg A+.
47
WR Hambrecht
JOBS Act
Best Efforts to Procure Potential

Investors
Compensation for Advisory
Services: $5,000/Month
Additional Fees: Underwriting
Discounts/Commissions (5% of
Gross Offering), Warrants (4.5%
of Total Shares Outstanding and
Priced Equal to 115% of IPO price),
Cover Out-of-Pocket (Legal Fees)
Defined as Emerging Growth Company

Only Two (2) Years of Audited Financial
Statements
Reduced Disclosure of Executive
Compensation
Exemption from Auditor Attestation
Requirement Sarbanes-Oxley
IPO
Selling 3.1M Shares of Common Stock

Closing of Offering, 7.3M Shares of
Common Stock Outstanding
IPO Priced Between $7 - $9/Share
Listing Common Stock on NASDAQ
Sell Lots of 100 or More Shares to a
Minimum of 300 Beneficial Holders
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

Opportunities & Challenges

Lorem ipsum
Reg A+ provides liquidity

to existing and new
shareholders.
Opportunities
Challenges
Institutional Capital Sources
Pre-IPO Investors, Institutional
Public Listing Provides

Liquidity to Existing and New
Shareholders
IPOs < $50M too Small for Most

Institutional Investors (~Oppenheimer,
Raymond James)
Public Listing Broadens

Investor Base Including
Institutional Capital
Participation
Limited Appetite for VCs (Unable to

Buy Public Stock Under 34 Rule and/
or Preference for Illiquidity - Liquidity
Event Must Distribute Cash to LPs
vs. Reinvest in Fund) and Other
Institutional Investors Given Low
Trading Volumes
After-Market Potential for

Institutional Investors to
Support Trading Volumes
Research Coverage = Pay to
Play, Companies/Portals Pay
for Coverage (i.e. Moodys,
S&P) Attracting Institutional
Investors
48
Challenges exist for Reg

A+ pre/post transaction
including institutional
participation.
Adverse Selection Companies

Utilizing Reg A+ Unable to Go Public
via Traditional Channels (Quality of
Offering, Size of Company, Financial
Health); If Company Could Go
Public Traditionally, They Would
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Title IV - Reg A+ Hybrid
Combination of Crowdfunding and Institutional Reg A+ Platforms

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BANQ and SJA offer

Hybrid Reg A+ Models.
Partner with SJA, and
BANQ to raise capital via
Reg A+.
Underwriter
Reg A+ Crowdfunding
Reg A+ Underwriter
Retail Capital Customers as Investors
Institutional Capital
Marketing Engine
49
No Underwriter
Branding and Advertising

Crowdfunding Strategy
Crowdfunding Design
Social Media Marketing
Influencer Marketing
Public Relations
Digital Media Buying
Collateral Design
Website Design
Video Production
Photography
Portal
Online Portal
Deal Hosting/Company Page
Front-End Offering
Marketing and Disclosure Displays
Investor Workflows
Transactions
Back Office
Compliance, Regulatory, Back Office

Escrow and ACH
AML (Anti-Money Laundering)
Broker Dealer Services
Accredited Investor Confirmations
Payment Processing
Registered Transfer Agent
eSign
Investor Management
Video Production
Photography
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Banq
First Fully Electronic Investment Bank

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Fully Licensed Broker Dealer and SIPC Insured, Enabling Direct Nasdaq Listings if Issuer
Qualifies
Brings Third Parties (i.e. Transfer Agent, Broker, Issuer, Investor) Only Single Platform
Facilitating Proper Communication
Shares Can Trade Immediately on Markets when Quoted
Shares Can be Transferred to other Broker Dealers (i.e. ACAT)
Provide Shareholders with all Information From a Single, Easy-to-Use and Intuitive
Platform
Eliminate Physical Certificates, Allowing Electronic Deposit and Sale of Securities
Hosts Electronic IRA Accounts the can Purchase Reg A+ Offerings
Utilize Web Technology to Create Attractive Marketing Content
Manage Confidential Information in a Secure Manner
Open to all Licensed Broker Dealers
50
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Banq
First Fully Electronic Investment Bank (continued)

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Firm Overview
Online Electronic Platform Sponsored by TriPoint Global Equities, LLC, a New York Based, Registered
Broker Dealer with SEC and FINRA and Investment Bank
Works with Issuers, Broker Dealers, and Investors Seeking to Raise Capital via Reg A+
Entire Reg A+ Offering Conducted Online and Provides Instantaneous Confirmation and Deposit of
all Investment Transactions
Allows Investors to Deposit and Liquidate Reg A+ Investment Shares Trading on OTC Markets
(~OTCQX) and Nasdaq
Offers Low-Priced Trading Commissions, as Low as $0.99 and $3.95 Per Trade Make Investing Even
More Accessible to Growing Number of Individual Investors
Bank Solves Reg A+ Barriers
Processing Large Number of Investor Inquiries, Receiving Investor Funds, and Issuing Securities
Complying with all FINRA Regulations Including those Pertaining to Stock Deposits, Clearing
Certificates, Regulatory Notices (09-05 OTC Listed Shares)
Broker Dealer Sponsorship Diligence, SIPC Insurance, Regulations
Verifying Investor Suitability and Investment Objectives
Electronic Trading
51
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
S. Jordan Associates

Lorem ipsum
52
HealtihosXchange:
Online Investment
Marketplace
(Crowdfunding,
Co-Investments)
Capbridge: Online
Investment Marketplace
(Pre-IPO Financing)
Singapore Exchange
(SGX) Onboard
Companies Into Public
Markets
Annual
Events
FinTECH
(Financial
Technology)
Consulting
Reg A+ Partner - BANQ

Campaign Page/
Marketing
Transfer Agent
Brokerage
Private
Placements
& Reg A
Business Development
Strategic Advisory
SJA Worked with Milken

Institute Drafting Reg A+
Guidance
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Please enter your Questions into the

question box in the GoToWebinar Interface

Lorem ipsum
53
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%
Thank You for Joining Us!

Lorem ipsum
S. Jordan Associates
www.sjordanassociates.com
scott@sjordanassociates.com
+1-847-849-1736
ShareVault
www.sharevault.com
sales@sharevault.com
+1-408-717-4955
We will notify you when

the recording and slide
deck are available.
54
New
FinTech Funding
Alternatives
for Life Science
Companies
45%
100%
30%
45%

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Addendum
55
Reg A+ Overview
Reg A+ Eligible Companies
Eligible companies organized in and with their principal place of
business in the U.S. or Canada
Exemption not available to the following companies :
Reporting company under Exchange Act of 1934
Development stage companies with no business plan or plan to
merge into another company
Investment companies
Company issuing fractional interests in oil, gas or other mineral
rights
Companies that are disqualified as Bad Actors under Rule 262
Offering Process: Key Factors
16
Offering statement is filed on Form 1-A with the SEC

Similar to, but less detailed than S-1 registration statement
Audited financials for last two full fiscal years required
May be filed confidentially, providing the SEC an opportunity to
review the offering statement and provide feedback without the
general public being aware
Pre-filing testing the waters allowed
Rule 254(a) allows written materials to be delivered to possible
investors to gauge interest prior to filing of Form 1-A
Solicitation allowed
Road shows allowed
Non accredited investors allowed
Tier II Eligibility
Tier II securities are exempt from Exchange Act registration under

Section 12(g) if issuer meets all of following conditions:
Engages services of a transfer agent registered with the SEC
Remains subject to Tier II reporting obligations
Is current in its annual and semi-annual reporting at fiscal yearend
Has public float of less than $75.0MM as of the last business day
of its most recently completed semi-annual period, or, in the
absence of a public float, had annual revenues of less than
$50.0MM as of its most recently completed fiscal year
An issuer that exceeds Section 12(g) thresholds would have a twoyear transition period before it must register its class of securities
Reg A+ vs. Reg D vs. Reverse Merger

Pros:
Free trading securities restrictions in fund governing documents
limiting or prohibiting investment in restricted securities dont apply
Public secondary market can develop
Non accredited (retail) investors allowed
Testing waters may be more permissive than general solicitation
now allowed under Rule 506(c)
SEC review of offering materials (vs. reverse merger which is
disfavored)
Cons:
More expensive than Reg D, although less than full reporting after
Form 10, reverse merger or IPO
Ongoing reporting, although scaled SEC review of offering materials
Tier I & Tier II Comparison

Tier I Offering
Tier II Offering
$20.0MM in 12-month period
$50.0MM in 12-month period
< $6.0MM OR
< 30% of total offering
< $15.0MM OR
< 30% of total offering
Blue Sky Requirements
Yes
No
Ability to File Confidentially
Yes
Yes
Ability to Test the Waters Before

Going To Market
Yes
Yes
None
(securities are free-trading)
None
(securities are free-trading)
None
Audited Financial Statements(1)

(substantially less than full reporting)
Accredited & Non-Accredited Investors
Accredited & Non-Accredited

Investors(2)
Dollar Limit for Offering

Limit On Securities Offered By Selling
(pre-existing) Shareholders
Restriction on Securities
Ongoing SEC Reporting Requirements
Investor Base
(1) Ongoing SEC reporting for a company that completes a Tier II offering includes (i) annual report on new form 1-K (similar to 10-K), (ii) semi-annual report on
new form 1-SA (similar to 10-Q) and (iii) current reports on new form 1-U (similar to 8-K). No quarterly reports are required.
(2) The limitation on the amount of securities non-accredited investors can purchase in a Tier II offering is no more than 10% of the greater of the investors annual
income or net worth (not including primary residence.
17
JOBS Act
Maximum
Total Raised
Public Crowdfunding
Regulation A+
(Tier 1)
Regulation A+
(Tier 2)
Regulation D
Rule 506 (4(a)(2))
$1MM per 12 month period
$20MM per 12 month period;

including up to $6.0MM for
selling shareholders
$50MM per 12 month period;

including up to $15.0MM for
selling shareholders
Unlimited
Unlimited but subject to

maximum total raised
Unrestricted
Unrestricted
Unlimited accredited
investors; up to 35 nonaccredited investors unless
soliciting (if soliciting; 0 nonaccredited investors)
Restricted by income / net

worth
Unrestricted
Restricted by income / net

worth for non-accredited
investors
Unrestricted
Required; must be filed with

SEC

SEC

SEC
Not required if all accredited

investors; Form D filing
proposed
Intermediary
Required
Yes; broker/dealer or funding

portal
No
No
No
Subject to ongoing
SEC reporting
following raise
Yes; at least annually, possibly

more frequently
No; as long as exit report filed

not later than 30 calendar days
after termination or
completion
Yes; annual audited financials

and annual, semi-annual,
current reporting required
No
Number of
Investors
Investment per
Investor
Investor
Disclosure
18
JOBS Act
Disclosure
Liability
Shares Restricted
State Filing
Advertising &
General
Solicitation
Can public cos.,

foreign issuers,
investment cos. &
exempt inv. cos.
issue
19
Public Crowdfunding
Regulation A+
(Tier 1)
Regulation A+
(Tier 2)
Regulation D
Rule 506 (4(a)(2))
Yes; full disclosure liability

with a knowledge exception


Only anti-fraud liability
Yes; for one year
No
No
Yes; for public companies most

can sell under Rule 144 after
six months
Possibly; depends on future

rules by state
Not exempt from state

securities law registration and
qualification requirements
Exempt from state securities

law registration and
qualification requirements
Usually no if only offering to

accredited investors
Not allowed
Testing the waters permitted

before & after filing; general
solicitation permitted before
qualification if preliminary
offering circular is provided,
general solicitation permitted
after qualification
Testing the waters permitted

before & after filing; general
solicitation permitted before
qualification if preliminary
offering circular is provided,
general solicitation permitted
after qualification
Allowed if sales are made only

to accredited investors and
issuer takes reasonable steps
to verify accreditation status
No
Only US, Canadian, non-public

issuers may issue
Only US, Canadian, non-public

issuers may issue
Yes

New FinTech Funding Alternatives For Life Science Companies

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CEO, S. Jordan Associates

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Introduction Stephen Joseph

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This Webinar Is Hosted by ShareVault

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ShareVault is a full-featured, state-of-the-art

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Sample Transactions Using ShareVault

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About Our Presenter, Scott Jordan

Assisting early-stage/growth companies accelerate

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Scott Jordans Background

Negotiating strategic corporate alliances

Cross-functional experience with former leadership roles in:

Sales & marketing

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FinTECH (Financial Technology)

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>3,300 members Accredited Investors,

The Worlds Premier

1,500 healthcare companies in

Sponsors S. Jordan Associates and

SGX - Raise, Capital for Small-Medium Size

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HealthiosXchange Membership Geographic Distribution

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What SJA Can Do for You

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Partner with SJA Execute Licensing

Hire SJA as Your

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JOBS Act (Jumpstart Our Business Startups)

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Intended to Encourage Funding of United States Small Businesses

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Passed with Bipartisan Support and was Signed Into Law

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Titles of the JOBS Act

Reopening American Capital Markets To

Title II Access To Capital For Job Creators

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