Sponsor Terms: Corresponding Project Investment Agreement

The following terms constitute a binding agreement (the "Agreement") between you and Sharestates, Inc, a Delaware Limited Liability Company ("Sharestates," "we," or "us").BY SIGNING THE AGREEMENT, YOU HAVE SIGNIFIED YOUR AGREEMENT TO THESE TERMS, OUR TERMS OF USE AND OUR PRIVACY POLICY.Under this Agreement, you agree to apply for one or more Project Investments through the web site platform at www.Sharestates.com, including any subdomains there of (the "Site"), operated by us. These terms affect your rights and you should read them carefully and print a copy for your records. Your agreement to these terms means you agree to take on and repay the money if any of your project investments are funded, consent to our privacy policy, agree to transact with us electronically, and agree to have any dispute with us resolved by binding arbitration.

1. Registration as a Borrower Member.

You are applying to register with us as a borrower member on the Site. Registration as a borrower member lets you post qualifying project investment requests on the Site and obliges you to accept any resulting project investments that satisfy such requests, subject to your right to cancel your project investment request before closing as set forth in section 3 below. Registration on the Site as a borrower member is restricted to individuals who satisfy our credit policy. Under our current credit policy as of September 2014, your Fair Isaac Corporation ("FICO") score must be greater than or equal to 660 and you must meet other credit criteria in order for you to be eligible to apply for any project investment. If for any reason you do not qualify or you later cease to qualify for a project investment from us, if, for example, your FICO score from any consumer reporting agency falls below 660, we may terminate your project investment request and deny your ability to make additional project investment requests. Even if your FICO score is higher than 660, we may nevertheless terminate your registration or project investment request based on our other criteria such as loan-to-value ratio or other information we request from you.

2. Project Investment Requests. 

To the extent you become and remain a registered borrower member, you may submit a qualifying project investment request on the Site in the amount of $100,000 to $10,000,000. You may not post a project investment request for a single corresponding project on more than one site at a time. Your project investment request must include all information required by us. Any qualifying project investment requests you submit may remain as an active listing on the Site for up to 60 days. If in accordance with your agreement with us, your project investment request attracts funding offers equal to or greater than 60% of your listed project investment request (and this amount is greater than or equal to the minimum qualifying principal amount) then your project investment will close and issue unless you notify us in writing of your election to terminate your project investment request sufficiently far in advance of project investment closing for us to cancel the project investment. The closing of a project investment with aggregate funding commitments of less than 60% of your listed project investment request is subject to your approval. If your project investment request was listed prior to the above date, issuance of a partially funded project investment is subject to your approval. Funding of your project investment request may be available before the expiration of the 60-day period set forth above but in no event shall we be obligated to notify you of the date upon which your project investment may, or will, fund.

3. Limited Power of Attorney.

As a condition to registering as a borrower member on the Site, you hereby grant us a limited power of attorney and appoint us and/or our designees as your true and lawful attorney-in-fact and agent, with full power of substitution and re-substitution, for you and in your name, place and stead, in any and all capacities, to: (1) complete and execute a 4506-T 'Request for Transcript of Tax Return' form from the Internal Revenue Service; and (2) complete and execute one or more promissory notes in the form appended to your Project investment Agreement with us (each, a "Note") representing in the aggregate the total principal amount you accept, and the terms, of each project investment made to you by us in accordance with the estimated disclosures made to you about such project investment, with the full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection with such power as fully to all intents and purposes as you might or could do in person ("Power of Attorney"). You agree and acknowledge that the initial project investment disclosures made to you are estimates and may be as much as 40% less than the initially requested amounts. This Power of Attorney is limited solely to the purpose described above and will expire automatically upon the earlier of (i) the execution of the Notes by us on your behalf or (ii) the termination or expiration of your project investment request posted on the Site. You may revoke the Power of Attorney at any time before the funds representing your project investment proceeds are transferred to your designated account and the Notes are executed on your behalf by contacting us in accordance with section 6, Communications. Once the Notes have been signed by Sharestates they are deemed executed and the executed Notesshall be our valid and binding obligations thereafter. If you choose to revoke the Power of Attorney prior to execution of Notes, we will be unable to proceed with processing your project investment request and your pending project investment requests will be considered withdrawn, and your registration as a borrower member on the Site will be terminated. In such event, we will remove any project investment requests you have posted on the Site and you may be prohibited from posting additional qualifying project investment requests in the future in our discretion.

4. Fees.

        A. Origination Fee. 

If your project investment request results in an issued project investment, you must pay us a non-refundable Origination Fee. The amount of the estimated fee is stated in the disclosures provided to you. This amount will decline if your project investment is not 100% funded. Notwithstanding the foregoing, no amount of the finally determined fee is refundable. This fee will be deducted from your project investment proceeds, so the project investment proceeds delivered to you will be less than the full amount of your issued project investment. You acknowledge that the origination fee will be considered part of the principal on your project investment and is subject to the accrual of interest.

        B. Due Diligence Posting Fee.

If your project investment request results in an issued project investment, you must pay us a non-refundable Due Diligence Posting Fee. The amount of the estimated fee is stated in the disclosures provided to you. This amount is fixed and will not decline if your project investment is not 100% funded. It is non-refundable once the minimum qualifying principal amount is reached. If the minimum qualifying principal amount is not reached, the Due Diligence Processing Fee will be refunded in full. Notwithstanding the foregoing, no amount of the finally determined fee is refundable. This fee is due upon execution of this agreement. This fee will be NOT be considered part of the principal on your project investment and is NOT subject to the accrual of interest and will not have the effect of reducing any principal owed.

        C. Project Investment Servicing; Check Processing Fee.

You acknowledge and agree that Sharestates shall serve as the project investment servicer for any and all project investments you receive but that Sharestates may delegate servicing to another entity. Sharestates will maintain all Notes representing your project investments in electronic form. As project investment servicer, Sharestates will administer and collect on your project investments. You may elect to make payments by personal check by contacting info@Sharestates.com or by regular mail at Sharestates, Inc, 8 Bond Street, Suite 100, Great Neck, NY 11021, Attention: Project Investment Processing Department. If you elect to make payments by check, you acknowledge and agree that there will be a $15 check processing fee per payment, subject to applicable law. If you elect to make payments by check, you must send the check either (i) by regular mail or by overnight mail or UPS delivery to Sharestates, Inc, 8 Bond Street, Suite 100, Great Neck, NY 11021, Attention: Project Investment Processing Department.

        D. SaaS Fees.

If your project investment request results in an issued project investment, you must pay us a non-refundable SaaS Fee. The amount of the estimated fee is stated in the disclosures provided to you. This amount will decline if your project investment is not 100% funded. Notwithstanding the foregoing, no amount of the finally determined fee is refundable. This fee (for the full term of your project investment) will be deducted from your project investment proceeds, so the project investment proceeds delivered to you will be less than the full amount of your issued project investment. You acknowledge that the SaaS fee will be considered part of the principal on your project investment and is subject to the accrual of interest.

5. Communications.

You agree not to communicate with the investors who purchase Borrower Payment Dependent Notes ("BPDNs") corresponding to your project investments except Sharestates. For a detailed description of the BPDNs, please refer to the Prospectus available on the Investment Details page for your corresponding project investment. Subject to section 16, you will send any inquiries, requests for deferment or forbearance, or other communications regarding your project investments by email to info@Sharestates.com Subject: Project investment Processing Department.

6. Other Member Obligations.

You agree that you are (A) a US citizen or permanent resident and (B) will not, in connection with your project investment request: (i) make any false, misleading or deceptive statements or omissions of fact in your listing, including but not limited to in the project investment title, or in your project investment description; (ii) misrepresent your identity, or describe, present or portray yourself as a person other than yourself; (iii) give to or receive from, or offer or agree to give to or receive from any Sharestates member or other person any fee, bonus, additional interest, kickback or thing of value of any kind except in accordance with the terms of your project investment; (iv) represent yourself to any person, as a representative, employee, or agent of ours, or purport to speak to any person on our behalf; or (v) or in communications on the Site related to your project investment request, provide information upon which a discriminatory lending decision may be made, such as your race, color, religion, national origin, sex, marital status, age, any exercise of your consumer rights or the existence of alimony, child support, or separate income (unless you have included such income in your application to be considered for project investment qualification).You acknowledge and agree that we may rely without independent verification on the accuracy, authenticity, and completeness of all information you provide to us. You certify that the proceeds of the project investment will not be used for any other purpose than that which was disclosed to Sharestates or its affiliates.

7. Verification.

We reserve the right to verify the accuracy of all information you provide and to terminate this Agreement and remove your project investment request in case of any inaccuracy or omission in your project investment request or your application, or any other violation of this Agreement. We reserve the right to verify any information you submit through the production of appropriate documentation, and also reserve the right to conduct such verification through a third party. You hereby authorize us to request and obtain data from a third party to verify any information you provide us in connection with your registration as a member member on the Site.

8. NO GUARANTEE. 

WE DO NOT WARRANT OR GUARANTEE (1) THAT YOUR REQUEST WILL BE FUNDED, OR (2) THAT YOU WILL RECEIVE A PROJECT INVESTMENT AS A RESULT OF SUBMITTING A REQUEST.

9. Restrictions on Use of Proceeds; Bank Account. 

You are not authorized or permitted to use the Site to obtain, or attempt to obtain, a project investment for someone other than yourself. You are not authorized or permitted to use the Site to obtain, or attempt to obtain, a project investment to (i) fund any illegal activity or (ii) any other activity or use not otherwise allowed under this Agreement or the Site. You must be the owner of the deposit account you designate for electronic transfers of funds and have authority to direct that project investment payments be made to us from such account. Your designated account will be the account into which project investment proceeds will be deposited and from which project investment payments will be made. To the extent that we determine, in our sole discretion, that your project investment request violates this Agreement or the Terms of Use, we may terminate your project investment request and cancel this Agreement immediately.

10. Termination of Registration.

We may terminate this Agreement and your status as a member at any time if you committed fraud or made a misrepresentation in connection with your registration on the Site or any application or request for a project investment, performed any prohibited activity, or otherwise failed to abide by the terms of this Agreement. In such event, we will have all remedies authorized or permitted by this Agreement and applicable law. We may, in our sole discretion, with or without cause and with or without notice, restrict your access to the Site.

11. DISCLAIMERS AND LIMITATION ON LIABILITY.

THIS AGREEMENT IS FULLY SUBJECT TO ALL DISCLAIMERS AND LIMITATIONS ON LIABILITY SET FORTH IN THE TERMS OF USE.

12. Entire Agreement.

This Agreement represents the entire agreement between you and us regarding the subject matter of the Agreement and supersedes all prior or contemporaneous communications, promises and proposals, whether oral, written or electronic, between us with respect to your registration as a borrower member and your project investment request.

13. Consent to Electronic Transactions and Disclosures. 

THIS AGREEMENT IS FULLY SUBJECT TO YOUR CONSENT TO ELECTRONIC TRANSACTIONS AND DISCLOSURES, WHICH CONSENT IS SET FORTH IN THE TERMS OF USE.

14. Notices. 

You agree that we can send you any and all notices and other communications related to this Agreement, any project investment requests you post or your status as a member by sending an email to your registered email address or posting the notice or communication on the Site, and notice or communication shall be deemed to have been duly given and effective when we send it or post it on the Site. You acknowledge that you have sole access to the registered email account and your area on the Site and that communications from us may contain sensitive, confidential, andcollections-related communications. If your registered email address changes, you must notify us immediately of the change by sending an email to info@Sharestates.com or calling 212-201-0750. You also agree to update promptly your registered residence address and telephone number on the Site if they change.

15. Miscellaneous.

The parties acknowledge that there are no third party beneficiaries to this Agreement. You may not assign, transfer, sublicense or otherwise delegate your rights or obligations under this Agreement to another person without our prior written consent. Any such assignment, transfer, sublicense or delegation in violation of this section 17 shall be null and void. This Agreement shall be governed by the laws of the State of Delaware without regard to any principle of conflict of laws that would require or permit the application of the laws of any other jurisdiction. Any waiver of a breach of any provision of this Agreement will not be a waiver of any other subsequent breach. Failure or delay by either party to enforce any term or condition of this Agreement will not constitute a waiver of such term or condition. If at any time after the date of this Agreement, any of the provisions of this Agreement shall be held by any court of competent jurisdiction to be illegal, void or unenforceable, such provision shall be of no force and effect, but the illegality and unenforceability of such provision shall have no effect upon and shall not impair the enforceability of any other provisions of this Agreement. The headings in this Agreement are for reference purposes only and shall not affect the interpretation of this Agreement in any way.

16. Arbitration.

a. Either party to this Agreement may, at its sole election, require that the sole and exclusive forum and remedy for resolution of a Claim be final and binding arbitration pursuant to this section 18 (the "Arbitration Provision"), unless you opt out as provided in section 18(b) below. As used in this Arbitration Provision, "Claim" shall include any past, present, or future claim, dispute, or controversy involving you (or persons claiming through or connected with you), on the one hand, and us and/or our affiliates, on the other hand, relating to or arising out of this Agreement, any Note, the Site, and/or the activities or relationships that involve, lead to, or result from any of the foregoing, including (except to the extent provided otherwise in the last sentence of section 18(f) below) the validity or enforceability of this Arbitration Provision, any part thereof, or the entire Agreement. Claims are subject to arbitration regardless of whether they arise from contract; tort (intentional or otherwise); a constitution, statute, common law, or principles of equity; or otherwise. Claims include matters arising as initial claims, counter-claims, cross-claims, third-party claims, or otherwise. The scope of this Arbitration Provision is to be given the broadest possible interpretation that is enforceable.

b. You may opt out of this Arbitration Provision for all purposes by sending an arbitration opt out notice to Sharestates, 8 Bond Street, Suite 100, Great Neck, NY 11021, Attention: Project investment Processing Department, which is received at the specified address within 30 days of the date of your acceptance of the terms of this Agreement. The opt out notice must clearly state that you are rejecting arbitration; identify the Agreement to which it applies by date; provide your name, address, and social security number; and be signed by you. You may send the opt out notice in any manner you see fit as long as it is received at the specified address within the specified time. No other methods can be used to opt out of this Arbitration Provision. If the opt out notice is sent on your behalf by a third party, such third party must include evidence of his or her authority to submit the opt out notice on your behalf.

c. The party initiating arbitration shall do so with the American Arbitration Association (the "AAA"). The arbitration shall be conducted according to, and the location of the arbitration shall be determined in accordance with, the rules and policies of the administrator selected, except to the extent the rules conflict with this Arbitration Provision or any countervailing law. In the case of a conflict between the rules and policies of the administrator and this Arbitration Provision, this Arbitration Provision shall control, subject to countervailing law, unless all parties to the arbitration consent to have the rules and policies of the administrator apply.

d. If we or our affiliates elect arbitration, we or our affiliates shall pay all the administrator's filing costs and administrative fees (other than hearing fees). If you elect arbitration, filing costs and administrative fees (other than hearing fees) shall be paid in accordance with the rules of the administrator selected, or in accordance with countervailing law if contrary to the administrator's rules. We or our affiliates shall pay the administrator's hearing fees for one full day of arbitration hearings. Fees for hearings that exceed one day will be paid by the party requesting the hearing, unless the administrator's rules or applicable law require otherwise, or you request that we pay them and we agree to do so. Each party shall bear the expense of its own attorneys' fees, except as otherwise provided by law. If a statute gives you the right to recover any of these fees, these statutory rights shall apply in the arbitration notwithstanding anything to the contrary herein.

e. Within 30 days of a final award by the arbitrator, any party may appeal the award for reconsideration by a three-arbitrator panel selected according to the rules of the arbitrator administrator. In the event of such an appeal, any opposing party may cross-appeal within 30 days after notice of the appeal. The panel will reconsider de novo all aspects of the initial award that are appealed. Costs and conduct of any appeal shall be governed by this Arbitration Provision and the administrator's rules, in the same way as the initial arbitration proceeding. Any award by the individual arbitrator that is not subject to appeal, and any panel award on appeal, shall be final and binding, except for any appeal right under the Federal Arbitration Act ("FAA"), and may be entered as a judgment in any court of competent jurisdiction.

f. COULD HAVE BEEN ASSERTED) IN A COURT AS CLASS REPRESENTATIVE, OR COLLECTIVE ACTIONS IN A COURT. Unless consented to in writing by all parties to the arbitration, no party to the arbitration may join, consolidate, or otherwise bring claims for or on behalf of two or more individuals or unrelated corporate entities in the same arbitration unless those persons are parties to a single transaction. Unless consented to in writing by all parties to the arbitration, an award in arbitration shall determine the rights and obligations of the named parties only, and only with respect to the claims in arbitration, and shall not (a) determine the rights, obligations, or interests of anyone other than a named party, or resolve any Claim of anyone other than a named party; nor (b) make an award for the benefit of, or against, anyone other than a named party. No administrator or arbitrator shall have the power or authority to waive, modify, or fail to enforce this section 18(f), and any attempt to do so, whether by rule, policy, arbitration decision or otherwise, shall be invalid and unenforceable. Any challenge to the validity of this section 18(f) shall be determined exclusively by a court and not by the administrator or any arbitrator.

g. This Arbitration Provision shall survive (i) suspension, termination, revocation, closure, or amendments to this Agreement and the relationship of the parties and/or their affiliates; (ii) the bankruptcy or insolvency of any party or other person; and (iii) any transfer of any project investment or Note or any other promissory note(s) which you owe, or any amounts owed on such project investments or notes, to any other person or entity. If any portion of this Arbitration Provision other than section 18(f) is deemed invalid or unenforceable, the remaining portions of this Arbitration Provision shall nevertheless remain valid and in force. If an arbitration is brought on a class, representative, or collective basis, and the limitations on such proceedings in section 18(f) are finally adjudicated pursuant to the last sentence of section 18(f) to be unenforceable, then no arbitration shall be had. In no event shall any invalidation be deemed to authorize an arbitrator to determine Claims or make awards beyond those authorized in this Arbitration Provision. THE PARTIES ACKNOWLEDGE THAT THEY HAVE A RIGHT TO LITIGATE CLAIMS THROUGH A COURT BEFORE A JUDGE OR JURY, BUT WILL NOT HAVE THAT RIGHT IF ANY PARTY ELECTS ARBITRATION PURSUANT TO THIS ARBITRATION PROVISION. THE PARTIES HEREBY KNOWINGLY AND VOLUNTARILY WAIVE THEIR RIGHTS TO LITIGATE SUCH CLAIMS IN A COURT BEFORE A JUDGE OR JURY UPONELECTION OF ARBITRATION BY ANY PARTY.