Sponsor agreement

You (and your co-sponsors) are the issuer’s managers and are solely responsible for the offering: its terms, the accuracy and completeness of everything you publish or say to investors, compliance with the Securities Act of 1933, the Securities Exchange Act of 1934, state securities laws and anti-fraud rules, and how investor money is used. DoorRaise doesn’t review your deal for merit and doesn’t act as your broker, adviser or lawyer.

For the fees on our pricing page, we: host your deal page and link; prepare the offering documents from our standard templates using the terms you choose; verify investors’ accredited status; screen investors against sanctions lists; collect electronic signatures; coordinate with the escrow agent; track funding; and provide reporting, distribution and tax-document tools after closing. Our standard templates are reviewed by our securities counsel. You may have your own lawyer review them at your cost.

Deals on DoorRaise use our standard documents and fee menu. You can choose fees only from the menu (acquisition fee, asset management fee on collected rent, preferred return and the split at sale or refinance). You can’t charge investors any other fee, promote, or compensation without disclosing it in the offering documents and getting our written approval.

Everything you submit must be true, complete and not misleading, including your track record, the property, the business plan, projections and their assumptions. Label projections as estimates. Give us the purchase contract, title commitment, lender term sheet, rent roll, trailing 12-month financials and closing statement when asked, and tell us right away if anything material changes. We will pause your deal page until the change is disclosed to investors.

Before your deal goes live, you and every covered person (each sponsor, managing member, executive officer, 20% or greater owner of the issuer by voting power, and anyone paid to solicit investors) must complete our Rule 506(d) questionnaire truthfully. You must tell us immediately if any answer changes. Any event before September 23, 2013 that would have been disqualifying must be disclosed to investors under Rule 506(e).

Follow our posting rules in everything you post or say about your deal. For a Rule 506(c) deal you may promote it publicly, but you must not accept money from anyone not verified as accredited. For a Rule 506(b) deal you must not advertise or generally solicit at all. You must not pay anyone to find investors unless they are a registered broker-dealer and the payment is disclosed.

All investor funds go to the escrow agent named for your deal. You must not ask or allow any investor to send money to you or anyone else. Funds are released only at closing, and only after the minimum raise is met and every investor has been verified, screened and has signed. If the minimum isn’t met by the deadline, funds are returned to investors.

The issuer must file Form D with the SEC within 15 days after the first sale and make the state notice filings required where investors live. DoorRaise prepares these for you as part of the closing fee and files them on your behalf when you authorize it; you remain responsible for their accuracy.

You must manage the property in line with the offering documents, keep complete books, send the reports and distributions the operating agreement requires, provide what our partner CPA needs to prepare Schedule K-1s on time, and keep investor information confidential.

You pay the $500 setup fee when you submit a deal. At closing the deal’s entity pays DoorRaise’s closing fee, which includes state filing fees, from escrow, and the yearly fee each year after that until the entity is dissolved. If a deal doesn’t close, only the setup fee is owed.

A co-sponsor must accept their invitation, duty and share of sponsor pay before the deal goes live. Every sponsor on a deal is responsible for that deal under this agreement, and the lead sponsor is our main contact.

We may decline, pause or remove any deal, or stop providing services, if we believe information is inaccurate, a law or this agreement may be broken, or continuing would put investors or DoorRaise at risk. If we do so after investors have committed, we’ll tell them.

You will cover DoorRaise’s losses, liabilities and reasonable legal costs from any claim arising from your offering, your statements to investors, your breach of this agreement, or your violation of any law.

We may update this agreement with notice. Changes don’t affect deals already closed except as the deal’s documents allow. Either side may end this agreement for future deals at any time; it continues to apply to any deal you have already posted.