PART II AND III

An offering statement pursuant to Regulation A relating to these securities has been filed with the Securities and Exchange Commission. Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the offering statement filed with the Commission is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy, nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of our sale to you that contains the URL where the Final Offering Circular or the offering statement in which such Final Offering Circular was filed may be obtained.

Subject to Completion, Dated February 6, 2017

AMENDMENT NO. 3

FORM 1-A

REGULATION A OFFERING STATEMENT

PART II- PRELIMINARY OFFERING CIRCULAR

SECURED REAL ESTATE INCOME FUND II, LLC

2090 N. Kolb Road, Ste 120

Tucson, AZ 85715

Tel: (888) 444-2102

info@reincomefunds.com

All correspondence to:

J. Martin Tate, Esq.

CARMAN LEHNHOF ISRAELSEN, LP

299 S. Main Street, Suite 1300

Salt Lake City, UT 84111

(801)(534-4435)

EMAIL FOR CORRESPONDENCE: mtate@clilaw.com

(Name, address, including zip code, and telephone number, including area code, of agent for service)

6162 81-2952810

                              (Primary standard Industrial Classification Code Number)                                             (I.R.S. Employer Identification Number)

Up to $50,000,000 in Class A Units of Membership Interests

$5,000.00 Minimum Investment

This is an initial public offering of SECURED REAL ESTATE INCOME FUND II, LLC and no public market currently exists for our Class A Units of Membership Interests ("Class A Units"). The initial public offering

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price of our Class A Units is expected to be $10.00 per Class A Units. We plan to apply to have our Class A Units quoted on the OTCQB.

This offering circular follows the disclosure format of Form S-11 pursuant to general instructions of Part II(a)(1)(ii) of Form 1-A.

Secured Real Estate Income Fund II, LLC is a newly organized Delaware limited liability company ("SREIF" or the "Company") formed for the purpose of investing in a diversified portfolio of real estate loans and other debt instruments collateralized by first and second position security interests in residential real estate in the U.S. and the underlying real estate collateral. We intend to acquire senior and subordinate real estate secured loans, and to invest in real estate and real estate-related debt instruments primarily originated by our affiliates. In addition, we may acquire any real properties or real estate equity investments that in the opinion of our Managing Member, meets our investment objectives. We plan to diversify our portfolio by investment type, investment size and investment risk with the goal of attaining a portfolio of real estate assets that provide attractive and stable returns to our investors. We may make our investments through the investment in or acquisition of individual loans or loan portfolios. We may also finance real estate projects using other funding methods, including (but not limited to) joint venture equity financing.As of the date of this offering circular, we have not commenced operations and do not own any real property or real estate loans.

 We are managed by SREIF Manager II, LLC, a Nevada limited liability company (the "Managing Member"), who has overall responsibility for managing and administering the business and affairs of the Company. The Managing Member has delegated responsibility and authority for making investment decisions for the Company to Good Steward Capital Management, Inc., an Arizona Corporation and investment adviser registered with the Securities and Exchange Commission, or SEC ("Investment Manager").

We are offering a minimum of 50,000 and a maximum of 5,000,000 Class A Units at an initial offering price of $10.00 per share, for a minimum offering amount of $500,000 and a maximum offering amount of $50,000,000. The minimum purchase requirement is 500 Class A Units, or $5,000; however, we can waive the minimum purchase requirement in our sole discretion. Following achievement of our minimum offering amount, we intend to hold additional closings on at least a monthly basis. The final closing will occur whenever we have reached the maximum offering amount. Until we achieve the minimum offering and have our initial closing and thereafter prior to each additional closing, the proceeds for that closing will be kept in an escrow account or, for subscribers purchasing through the FOLIO Investments, Inc. platform, deposited in such subscriber's account with FOLIO Investments, Inc., or Folio. We expect to offer Class A Units in this offering until we raise the maximum amount being offered, unless terminated by our Managing Member at an earlier time. Until the earlier of (a) March 31, 2017 or (b) the listing of our shares on a public exchange, the per Class A Unit purchase price for our Class A Units will be $10.00 per Class A Unit, an amount that was arbitrarily determined by our Managing Member. Thereafter, the per Class A Unit purchase price will be adjusted quarterly on the first day of each quarter and will equal the sum of our net asset value, or NAV, divided by the number of our Class A Units outstanding as of the end of the prior month (NAV per Class A Unit). We intend to contact an authorized OTCQB market maker for sponsorship of our securities on the OTCQB, upon qualification of this Form 1-A. However, there is no guarantee our Class A Units will be accepted for quotation on the OTCQB.

We have engaged Cambria Capital, LLC, a FINRA member firm, which we refer to as Cambria Capital, to act as our non-exclusive placement agent in connection with this offering. We may engage other FINRA member firms to act as placement agents for this offering. Our placement agents will offer our shares to prospective investors on a best efforts basis. Neither Cambria Capital nor any other placement agent that we engage will be required to purchase any of our securities or make any firm commitment. There can be no assurance that any securities will be sold in this offering.

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Investing in our Class A Units is speculative and involves substantial risks. You should purchase these securities only if you can afford a complete loss of your investment. See "Risk Factors" beginning on page 20 to read about the more significant risks you should consider before buying our Class A Units. These risks include the following:

· We depend on our Investment Manager to select our investments and conduct our operations. We will pay fees and expenses to our Managing Member, the Investment Manager and their affiliates that were not determined on an arm's length basis, and therefore we do not have the benefit of arm's length negotiations of the type normally conducted between unrelated parties. These fees increase your risk of loss.

· We have no operating history. The prior performance of our sponsor and its affiliated entities may not predict our future results. Therefore, there is no assurance that we will achieve our investment objectives.

· We have not identified any investments to acquire with the net proceeds of this offering. You will not be able to evaluate our investments prior to purchasing Class A Units.  

· This offering is being made pursuant to recently adopted rules and regulations under Regulation A of the Securities Act of 1933, as amended, or the Securities Act.  The legal and compliance requirements of these rules and regulations, including ongoing reporting requirements related thereto, are relatively untested.

· If we raise substantially less than the maximum offering amount, we may not be able to acquire a diverse portfolio of investments and the value of your Class A Units may vary more widely with the performance of specific assets. We may commence operations with as little as $500,000.

· We may change our investment guidelines without member consent, which could result in investments that are different from those described in this offering circular.

· Although our distribution policy is not to use the proceeds of this offering to make distributions, our organizational documents permit us to pay distributions from any source, including offering proceeds, borrowings or sales of assets. We have not established a limit on the amount of proceeds we may use to fund distributions. If we pay distributions from sources other than our cash flow from operations, we will have less funds available for investments and your overall return may be reduced.

· Our internal accountants will calculate our NAV on a quarterly basis using valuation methodologies that involve subjective judgments and estimates.  As a result, our NAV may not accurately reflect the actual prices at which our real estate assets and investments, including related liabilities, could be liquidated on any given day.

· Our Operating Agreement does not require our Managing Member to seek member approval to liquidate our assets by a specified date, nor does our Operating Agreement require our Managing Member to list our Class A Units for trading or to have them quoted on the over the counter market by a specified date.  No public market currently exists for our Class A Units.  Until our Class A Units are listed on an exchange or quoted on the over the counter market, if ever, you may not sell your Class A Units in a public market and must sell those securities through private transactions.  If you are able to sell your Class A Units, you may have to sell them at a loss.

· Our intended investments in real estate loans, real estate and other select real estate-related assets will be subject to risks relating to the volatility in the value of the underlying real estate, default on underlying income streams, fluctuations in interest rates, and other risks associated with debt, and real estate investments generally.  These investments are only suitable for sophisticated investors with a high-risk investment profile.

· We believe we are a partnership for U.S. federal income tax purposes and are solely relying on an opinion rendered by Durham Jones & Pinegar P.C. in making this determination. Partnership status requires a facts and circumstances determination and if we are incorrect in our determination, we would be required to pay tax at corporate rates on any portion of our net income that does not constitute tax-exempt income, and distributions by us to our members would be taxable dividends to the extent of our current and accumulated earnings and profits.

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	Per Class A Unit			Total Minimum				Total Maximum
Public Offering Price(1)		$	10.00		$	500,000	(2)		$	50,000,000
Underwriting Discounts and Commissions(3)		$	.90		$	45,000			$	4,500,000
Total Proceeds to Us (Before Expenses)(4)(5)		$	9.10		$	455,000			$	45,500,000

(1)	The price per Class A Unit shown was arbitrarily determined by our Managing Member and will apply until March 31, 2017. Thereafter, our price per Class A Unit will be adjusted every fiscal quarter and will be based on our NAV as of the end of the prior fiscal quarter.
(2)	This is a "best efforts" offering.  We will not start operations or draw down on investors' funds and admit investors as members until we have raised at least $500,000 in this offering. Until the minimum threshold is met, investors' funds will be held in escrow or in a subscribers account at Folio Investments, Inc. If we do not raise $500,000 within 12 months, we will cancel the offering and release all investors funds from escrow or the subscribers account at Folio Investments, Inc.  See "How to Subscribe".
(3)	We have engaged Cambria Capital, LLC, a FINRA member firm, as our non-exclusive placement agent.  We may engage other placement agents.  We have agreed to pay Cambria Capital a placement fee of 7.0% of the gross proceeds of this offering received by the Company that are derived from investors introduced to the Company by Cambria Capital ("Cambria Referrals") and we have advanced to Cambria Capital a retainer in the amount of $15,000 for the payment of actual, accountable and reasonable out-of-pocket expenses incurred by it.  This retainer amount will be set off against and credited toward the non-accountable expense reimbursement described below and will be reimbursed to the Company to the extent not actually incurred in accordance with FINRA Rule 5110(f)(2)(C).  In addition, we have agreed to pay Cambria Capital a non-accountable expense reimbursement of 1.50% of the gross proceeds received by the Company in this offering that are derived from Cambria Referrals.  We have also agreed to pay a platform fee of 0.5% to Folio on all investment funds that clear through the Folio platform.  Accordingly, this table depicts underwriting discounts, commissions and expense reimbursements of up to 9% of the gross offering proceeds. We will pay Cambria Capital and any other placement agents that we may engage in the future selling commissions, underwriting discounts and expense reimbursements of up to 9% of the gross offering proceeds.   In the event that the offering abruptly terminates before reaching the maximum amount of offering proceeds, the participating members will refund to the issuer any amount of compensation that exceeds the 10% limitation described in FINRA Rule 2310(b)(4)(B)(ii).
(4) (5)	We will reimburse our Managing Member for organization and offering costs, which are expected to be approximately $150,000. To date the Managing Member has incurred approximately $105,000.  See "Management Compensation" for a description of additional fees and expenses that we will pay our Managing Member. Please see "section entitled Plan of Distribution"

Generally, no sale may be made to you in this offering if the aggregate purchase price you pay is more than 10% of the greater of your annual income or net worth. Different rules apply to accredited investors and

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non-natural persons. Before making any representation that your investment does not exceed applicable thresholds, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to  www.investor.gov .

THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE COMMISION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.

The date of this offering circular is February 6, 2017 .

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IMPORTANT INFORMATION ABOUT THIS OFFERING CIRCULAR

Please carefully read the information in this offering circular and any accompanying offering circular supplements, which we refer to collectively as the offering circular. You should rely only on the information contained in this offering circular. We have not authorized anyone to provide you with different information. This offering circular may only be used where it is legal to sell these securities. You should not assume that the information contained in this offering circular is accurate as of any date later than the date hereof or such other dates as are stated herein or as of the respective dates of any documents or other information incorporated herein by reference.

This offering circular is part of an offering statement that we filed with the SEC, using a continuous offering process. Periodically, as we make material investments, update our quarterly NAV per Class A Unit amount, make material changes or have other material developments, we will provide an offering circular supplement that may add, update or change information contained in this offering circular. Any statement that we make in this offering circular will be modified or superseded by any inconsistent statement made by us in a subsequent offering circular supplement. The offering statement we filed with the SEC includes exhibits that provide more detailed descriptions of the matters discussed in this offering circular. You should read this offering circular and the related exhibits filed with the SEC and any offering circular supplement, together with additional information contained in our annual reports, semi-annual reports and other reports and information statements that we will file periodically with the SEC. See the section entitled "Additional Information" below for more details.

The offering statement and all supplements and reports that we have filed or will file in the future can be read at the SEC website, www.sec.gov, or our website located atwww.SecuredRealEstateFunds.com. The contents on our website (other than the offering statement, this offering circular and the appendices and exhibits thereto) are not incorporated by reference in or otherwise a part of this offering circular.

Our Managing Member and those selling Class A Units on our behalf in this offering will be permitted to make a determination that the purchasers of Class A Units in this offering are "qualified purchasers" in reliance on the information and representations provided by the member regarding the member's financial situation. Before making any representation that your investment does not exceed applicable thresholds, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov.

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TABLE OF CONTENTS

IMPORTANT INFORMATION ABOUT THIS OFFERING CIRCULAR	6
STATE LAW EXEMPTION AND PURCHASE RESTRICTIONS	8
OFFERING SUMMARY	9
THE OFFERING	23
RISK FACTORS	24
STATEMENTS REGARDING FORWARD-LOOKING INFORMATION	46
DETERMINATION OF OFFERING PRICE	48
ESTIMATED USE OF PROCEEDS	48
PLAN OF OPERATION	50
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	52
GENERAL INFORMATION	57
INVESTMENT OBJECTIVES AND STRATEGY	58
LENDING STANDARDS AND POLICIES	70
MANAGEMENT	77
PRIOR PERFORMANCE SUMMARY	84
MANAGEMENT COMPENSATION	90
FIDUCIARY RESPONSIBILITY OF MANAGING MEMBER	94
OWNERSHIP OF PRINCIPAL MEMBERS	95
CONFLICTS OF INTEREST	96
DESCRIPTION OF OUR CLASS A UNITS	92
U.S. FEDERAL INCOME TAX CONSIDERATIONS	109
ERISA CONSIDERATIONS	118
PLAN OF DISTRIBUTION	128
HOW TO SUBSCRIBE	117
LEGAL MATTERS	130
EXPERTS	130
ADDITIONAL INFORMATION	130
INDEX TO FINANCIAL STATEMENTS OF SECURED REAL ESTATE INCOME FUND II, LLC	131

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STATE LAW EXEMPTION AND PURCHASE RESTRICTIONS

Our Class A Units are being offered and sold only to "qualified purchasers" (as defined in Regulation A under the Securities Act). As a Tier 2 offering pursuant to Regulation A under the Securities Act, this offering will be exempt from state law "Blue Sky" review, subject to meeting certain state filing requirements and complying with certain anti-fraud provisions, to the extent that our Class A Units offered hereby are offered and sold only to "qualified purchasers" or at a time when our Class A Units are listed on a national securities exchange. "Qualified purchasers" include: (i) "accredited investors" under Rule 501(a) of Regulation D and (ii) all other investors so long as their investment in our Class A Units does not represent more than 10% of the greater of their annual income or net worth (for natural persons), or 10% of the greater of annual revenue or net assets at fiscal year-end (for non-natural persons). However, our Class A Units may, in the sole discretion of the issuer, be offered and sold only to those investors that are within the latter category (i.e., investors whose investment in our Class A Units does not represent more than 10% of the applicable amount), regardless of an investor's status as an "accredited investor." Accordingly, we reserve the right to reject any investor's subscription in whole or in part for any reason, including if we determine in our sole and absolute discretion that such investor is not a "qualified purchaser" for purposes of Regulation A.

To determine whether a potential investor is an "accredited investor" for purposes of satisfying one of the tests in the "qualified purchaser" definition, the investor must be a natural person who has:

1. an individual net worth, or joint net worth with the person's spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person; or

2. earned income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year.

If the investor is not a natural person, different standards apply. See Rule 501 of Regulation D for more details.

For purposes of determining whether a potential investor is a "qualified purchaser," annual income and net worth should be calculated as provided in the "accredited investor" definition under Rule 501 of Regulation D. In particular, net worth in all cases should be calculated excluding the value of an investor's home, home furnishings and automobiles.   

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OFFERING SUMMARY

This offering summary highlights material information regarding our business and this offering that is not otherwise addressed in the "Questions and Answers About this Offering" section of this offering circular. Because it is a summary, it may not contain all of the information that is important to you. To understand this offering fully, you should read the entire offering circular carefully, including the "Risk Factors" section before making a decision to invest in our Class A Units.

SECURED REAL ESTATE INCOME FUND II, LLC commenced operations in June 2016. Except as otherwise indicated, the terms "we," "us," "our" and the "Company" refer to SECURED REAL ESTATE INCOME FUND II, LLC.

Overview of Secured Real Estate Income Fund II, LLC

The Company has been organized primarily for the purpose of investing in a diversified portfolio of real estate loans ("Loans") and other debt instruments collateralized by first and second position security interests in residential and real estate in the U.S. and the underlying real estate collateral. We intend to acquire senior and subordinate mortgage bridge and other real estate loans, and to invest in real estate and real estate-related debt instruments primarily originated by one or more entities affiliated with the Company, the Managing Member, the Investment Manager or their respective officers, directors, managers and members  ("Affiliates"). In addition, we may acquire any real properties or real estate equity investments suggested by the Investment Manager that, in the opinion of our Managing Member, meet our investment objectives. We plan to diversify our portfolio by investment type, investment size and investment risk with the goal of attaining a portfolio of real estate assets that provide attractive and stable returns to our investors. We may make our investments through direct loan origination, the acquisition of individual loans or loan portfolios. We may also finance real estate projects using other funding methods, including (but not limited to) joint venture equity financing.

All of the Loans are expected to be evidenced by a promissory note secured by instruments granting a security interest in real property which may be mortgages, deeds of trust, security deeds or deeds to secure debt, depending upon the prevailing practice and law in the state in which the mortgaged property is located. Mortgages, deeds of trust and deeds to secure debt are referred to in this offering circular collectively as "Mortgages." Any of the foregoing types of mortgages will create a lien upon, or grant a title interest in, the subject property, the priority of which will depend on the terms of the particular security instrument, as well as separate, recorded, contractual arrangements with others holding interests in the mortgaged property, the knowledge of the parties to such instrument as well as the order of recordation of the instrument in the appropriate public recording office. However, recording does not generally establish priority over governmental claims for real estate taxes and assessments and other charges imposed under governmental police powers.

Our office is located at 2090 N. Kolb Road, Ste 120 Tucson, AZ 85715 . Our telephone number is (888) 444-2102. Information regarding our company is available at  www.SecuredRealEstateFunds.com . Information available on our website is not incorporated by reference in and is not deemed a part of this offering circular.

Investment Strategy

We intend to use substantially all of the proceeds of this offering to invest in and manage a diversified portfolio of real estate investments. We expect to use substantially all of the net proceeds from this offering to acquire and structure Loans collateralized by single family and multifamily non-owner occupied residences and commercial properties and land. For its loan portfolio, the Company will secure Loans with first and/or second position security interests. The Company may also finance real estate projects using other funding methods, including (but not limited to) joint venture equity financing.

The Company's primary Loan product will be short-term, or "bridge", Loans, which will be characterized with the following targeted parameters:

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1. Twelve (12) to twenty-four (24) month note secured by first or second position deeds of trust, mortgage, security deed or similar instruments;

2. Borrowers may be required to pay interest-only payments and shall also pay loan origination fees or loan arrangement fees in the amount of two (2) or more points;

3. Loan amount can include acquisition, development, improvement, or new construction loans with the associated costs;

4. Subject to possible tax restrictions, some of the Loans may utilize Shared Appreciation Mortgages ("SAMs," also known as Contingent Interest Notes) in order to secure an equity position in the underlying collateral. For such financing the Company's targeted share of the return is 10% or greater of the appreciation in equity;

5. Loans will be extended to borrowers in relation to undervalued or distressed , non-owner occupied, single family or multi-family residences (including condos, townhomes and Planned Unit Developments), as well as for land development and new construction, and commercial properties  ( office , retail and other );

6. Loan amounts will usually be based on 70% or less of the As-Completed Value of the property excluding interest reserves. This figure may increase if sufficient additional collateral is provided by the borrower;

7. Short-term loans allow borrowers to purchase properties that may not qualify for financing through conventional mortgage lenders. Once the property is rehabilitated or developed, the borrower may sell the property wholesale or retail;

8. Loans will not be insured by the Federal Housing Administration or guaranteed by the Veterans Administration or otherwise guaranteed or insured;

9. Loans will be made throughout the United States, with a particular focus in the Western United States and California;

10. Exit fees may be payable to the Company by the borrower upon sale or resale of property and/or loans. All exit fees on loans in which the Company is the lender, co-lender, or fractional lender, shall be payable to the Company. In the event the Company is the co-lender or a participating or fractionalized lender, the Company shall receive its pro-rata share of the exit fee based on its time and ownership percentage of the  loans;

11. Once sufficiently capitalized ($1,000,000 in invested capital), the Company will seek to invest no more than ten percent (10%) of its assets in any single loan.

The Company may also make, purchase, and otherwise acquire Loans which have a duration of more than 24 months or may directly acquire property for longer term investment. The Managing Member intends to have one or more Affiliates directly structure, underwrite and originate many of the debt products in which we invest as this provides for the best opportunity to control our borrower and partner relationships and optimize the terms of our investments. The management team of our Managing Member has extensive real estate experience and the ability to perform comprehensive financial, structural, operational and legal due diligence of our borrowers and partners in order to optimize pricing and structuring and mitigate risk. We feel the current and future market environment (including any existing or future government-sponsored programs) provides a wide range of opportunities to generate compelling investments with strong risk-return profiles for our members.

We will seek to create and maintain a portfolio of Loans and other real estate investments that generate a low volatility income stream of attractive and consistent cash distributions. Our focus on investing in debt instruments with qualified borrowers (which may include entities which are owned or controlled by the Company, the Managing Members or their Affiliates) that will emphasize the payment of current returns to investors and preservation of invested capital as our primary investment objectives, with a lesser emphasis on seeking capital appreciation from our investments, as is typically the case with more opportunistic or equity-oriented strategies.

In addition, the Company may, from time to time, acquire in its own name, or through one or more wholly owned subsidiaries, commercial properties or interests in real estate properties.

Investment Objectives

Our primary investment objectives are to identify, originate and fund Loans and other investments designed to create capital preservation and pay consistent and appealing cash distributions.

We will also seek to realize growth in the value of our investments by timing the sale or disposition to maximize value.

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Market Opportunities

FCI Lender Services, Inc, one of the largest non-bank originated loan servicers, recently estimated the US real estate private-lending industry generates approximately $65 billion in mortgages per annum¹. Based on our research, we believe the private commercial real estate lending market will continue to have a promising outlook over the short and medium term, with lending to the residential and small commercial real estate sectors all projected to grow in the coming years.

According to the Urban Land Institute, the value of commercial real estate in the US is expected to grow 3.6% every year through 2018. The same report indicates that single-family housing starts are projected to increase from 714,600 units in 2015 to 900,000 units in 2018.². In addition, the residential apartment market is expected to experience solid growth in the coming years, as housing construction increases and home values rise. According to Freddie Mac, the multifamily housing market will also "remain strong into the foreseeable future"³.According to the ULI, apartment rental rate growth is expected to grow in 2016 and '17 by 3.6% and 3.0%, respectively, and remain above the 20-year average growth rate of 2.8%.⁴ A recent report by CBRE indicates the senior housing market has a very strong long-term outlook⁵, with demand increasingly steadily and reliably as the US population ages. Student housing is expected to grow in the near term⁶, with the student population increasing to 23 million by 2020. Student housing sales have increased significantly in the last 10 years, and the student population has steadily increased over the last 20 years.

Given the prospect of continued growth for the economy, we favor a strategy weighted toward targeting senior position collateralized Loans secured by residential and real estate assets which emphasize capital preservation and maximize current income. In contrast, returns typically associated with pure equity strategies are mostly "back-ended" and are dependent on asset appreciation, capitalization rate compression, cash flow growth, aggressive refinancing and/or sale of the underlying property.

We believe that our investment strategy, combined with the experience and expertise of our Managing Member's management team, will provide opportunities to originate investments with attractive current and accrued returns and strong structural features directly with real estate companies, thereby taking advantage of changing market conditions in order to seek the best risk-return dynamic for our members

Management

The Managing Member is responsible for the overall management of the Company's affairs and has control over the day-to-day operations and activities of the Company. The Managing Member has delegated investment management responsibilities to the Investment Manager. Subject only to the provisions of the Operating Agreement, its delegation of authority to the Investment Manager and the requirements of applicable law, the Managing Member shall possess full and exclusive right, power and authority to manage and conduct the business and affairs of the Company. In managing and conducting the business and affairs of the Company, the Managing Member may, among other things, cause the Company to take such actions as the Managing Member reasonably determines in good faith to be necessary, appropriate, advisable, incidental or convenient to effect the formation of the Company, promote or conduct the Company's business or achieve the Company's objectives. See the Operating Agreement for a complete description of the powers of the Managing Member and the limitations on those powers.

The Investment Manager has discretionary investment authority over the Company's assets. The Managing Member and the Investment Manager may each employ additional personnel. The Investment Manager is responsible for investing the capital and resources of the Company and monitoring such investments, as necessary, in order to achieve the Company's investment objective.

¹ Source: http://www.wsj.com/articles/private-lenders-remodel-the-mortgage-market-1462984898

²Source: Urban Land Institute http://uli.org/research/centers-initiatives/center-for-capital-markets/barometers-forecast-and-data/uli-real-estate-consensus-forecast/

³ Source: FreddieMac MultiFamily Outlook 2016 http://www.freddiemac.com/multifamily/pdf/freddieMac_mf_outlook_2016.pdf

⁴ Source: Urban Land Institute http://uli.org/wp-content/uploads/ULI-Documents/ULIREConsensusForecast_Spring2016.pdf

⁵ Source: CBRE Investor Survey and Market Outlook February 2016 http://www.cbre.us/services/valuationadvisory/AssetLibrary/CBRE_SeniorsHousing_InvestorSurvey_H2_2015.pdf

⁶ Source: CCIM http://www.ccim.com/cire-magazine/articles/323626/2014/09/student-housing-stats/?gmSsoPc=1

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The Managing Member may replace the Investment Manager from time-to-time in its discretion, or appoint itself as the Investment Manager.

Management Compensation

Our Managing Member and the Investment Manager and their Affiliates will receive fees and expense reimbursements for services relating to this offering and the investment and management of our assets. The items of compensation are summarized in the following table. Neither our Managing Member, our Investment Manager nor any of their respective Affiliates will receive any selling commissions or placement agent fees in connection with the offer and sale of our Class A Units. See "Management Compensation" for a more detailed explanation of the fees and expenses payable to our Managing Member, Investment Manager and its Affiliates.

The following discussion summarizes some important areas of compensation to be received by the Managing Member

Form of Compensation	Estimated Amounts	Description of Compensation or Method of Calculation	Recipient
ORGANIZATIONAL STAGE FEES
ORGANIZATIONAL AND OFFERING EXPENSES	$150,000	To date, our Managing Member has paid organization and offering expenses on our behalf.  We will reimburse our Managing Member for these costs and future organization and offering costs it may incur on our behalf.  To date, we have incurred approximately $105,000. We expect organization and offering expenses to be approximately $150,000.	Managing Member.
MANAGEMENT FEES AND PROFIT SHARING- OPERATIONAL STAGE FEES
MANAGEMENT FEE	2% of capital contributions.	The Managing Member shall be entitled to a management fee in an annual amount of two-percent (2%) of the total capital contributions, payable monthly.  Assuming the sale of the minimum amount of Class A Units, the Managing Member would be entitled to a management fee in the amount of $6,100 . Assuming the sale of the maximum amount of Class A Units and $150,000 of organisational and offering expenses , the Managing Member/ Investment Advisor would be entitled to a management fee in the amount of $897,000 . The Managing Member may direct all, or a portion of the profits to the Investment Manager.	Managing Member and Investment Manager.

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PROFIT SHARE	20% of net profits	he Managing Member shall be entitled to receive twenty percent (20%) of the Company's net profits after the payment of the Preferred Return payable in quarterly distributions.
ASSET RELATED- OPERATIONAL STAGE FEES
LOAN ARRANGEMENT   AND FUNDING FEES	2-5% of the loan amounts	Loan arrangement or fund fees are collected from the borrowers. Such fees average between two and five percent (2-5%) of the total loan amount depending on market conditions. Loan arrangement fees are Company income and are shared by the Class A Unit holders and the Managing Member in accordance with the allocation of net income.  For example, in connection with the arrangement and funding of a Loan in the amount of $100,000.00, the Company would receive $2,000-$5,000 from the borrower.  This amount would be considered income of the Company and would be disbursed in accordance with the operating agreement, 80% to the holders of the Class A and 20% to the Managing Member as the holder of the Class B Units (or the Investment Manager pursuant to the Investment Management Agreement)	All loan origination fees will be shared between the Managing Member, as the holder of the Class B Units and the holders of the Class A Units.  The Managing Member's portion will constitute compensation to the Managing Member.

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LOAN EXTENSION AND MODIFICATION FEES	1-3% of loan amount	Loan extension and modification fees are collected from borrowers and payable to the Company.  Such fees are typically between one and three percent (1-3%) of the original loan amount, but could be higher or lower depending on market rates and conditions.  Such fees collected by the Managing Member on the Company's behalf and are not considered a part of the Managing Member's direct compensation, as such fees are payable only to the Company and are shared by the Class A Unit holders and the Managing Member as the Class B Unit holder.  For example, in connection with extension of a Loan in the amount of $100,000.00, the Company would receive $1,000-$3,000 from the borrower.  This amount would be considered income of the Company and would be disbursed in accordance with the 80% to the holders of the Class A and 20% to the Managing Member as the holder of the Class B Units (or the Investment Manager pursuant to the Investment Management Agreement)	Such fees collected by the Managing Member for the benefit of the Company's and are considered Company income, which are shared between the Managing Member as the holder of the Class B Units and the holders of the Class A Units.
LOAN PROCESSING, LOAN DOCUMENTATION AND OTHER SIMILAR FEES		Loan processing, documentation and other similar fees are collected from the borrower at the time of the loan funding and payable to the Company or its broker or loan servicing company at prevailing industry rates.  These fees are typically between $500-$1,000.	Such fees collected by the Managing Member are collected on the Company's behalf and are not considered a part of the Managing Member's direct compensation, as such fees are payable only to the Company.  These fees are considered Company income, which are shared between the Managing Member as the holder of the Class B Units and the holders of the Class A Units as described in the Operating Agreement.

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OTHER LOAN FEES		The Company will earn other loan fees as follows: One Hundred Percent (100%) of its pro-rata share of the following fees paid by borrowers on account of Loans: (i) all late fees incurred by borrowers on defaulted loans; (ii) all default interest incurred by borrowers on defaulted loans (default interest means the amount of interest charged upon a default being declared that is above the contract interest rate); (iii) all forbearance, extension and other fees incurred by borrowers; (iv) all prepayment penalties incurred by borrowers; (v) all pro-rata contingent interest and/or exit fees.  These amounts would be considered income of the Company and would be disbursed 80% to the holders of the Class A and 20% to the Managing Member as the holder of the Class B Units (or the Investment Manager pursuant to the Investment Management Agreement)	Such fees collected by the Managing Member are collected on the Company's behalf and are not considered a part of the Managing Member's direct compensation, as such fees are payable only to the Company.  These fees are considered Company income, which are shared between the Managing Member as the holder of the Class B Units and the holders of the Class A Units as described in the Operating Agreement.
PURCHASE OF EXISTING LOANS	Between 1% and 5% of the loan amount.	When the Company purchases an existing loan (or pool of loans) from a third party, one or more brokers or sellers may receive a commission.  Such persons may include affiliates of the Managing Member, the Investment Manager or their principals.  The Managing Member will not be paid any fees in connection with such sale.	Brokers and seller, which may include Affiliates of the Managing Member, Investment Manager or their principals.

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REAL ESTATE COMMISSIONS	3-10% of disposition proceeds.	Third parties, including Affiliates of the Managing Member and Investment Manager may earn real estate commissions to list and sell real estate that the Company has acquired through foreclosure. Such fees shall be at market rates and shall not exceed 10% of the total proceeds received upon asset disposition and are paid at the time of the asset disposition.	Third parties, including Affiliates of the Managing Member.
PROJECT MANAGEMENT FEES	1-10% of disposition proceeds.	The Company or Affiliates of the Managing Member or Investment Manager may earn project management fees. Such fees shall be at market rates and shall not exceed 10% of the total proceeds received upon asset disposition and are paid at the time of the asset dispositon.	The Company or Affiliates of the Managing Member

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Summary of Risk Factors

Investing in our Class A Units involves a high degree of risk. You should carefully review the "Risk Factors" section of this offering circular, beginning on page 21, which contains a detailed discussion of the material risks that you should consider before you invest in our Class A Units.

Conflicts of Interest

Our Managing Member, Investment Manager and their respective Affiliates will experience conflicts of interest in connection with the management of our business. Some of the material conflicts that our Managing Member and its Affiliates will face include the following:

· ·	The management team of our Managing Member and our Investment Manager must determine which investment opportunities to recommend to us and other managed entities. ·The Managing Member may also participate in real estate transactions in their own capacity and some of these transactions may be alongside the Company
·	The management team of our Managing Member and our Investment Manager will have to allocate their time among us, other businesses, programs and activities in which they are involved.
·	The terms of our Operating Agreement (including the Managing Member's rights and obligations and the compensation payable to our Managing Members and its Affiliates) were not negotiated at arm's length.
·	Our members may only remove our Managing Member for "cause" following the affirmative vote of members holding two-thirds of the outstanding Class A Units.  Unsatisfactory financial performance does not constitute "cause" under the Operating Agreement.
·	The Managing Member may, without member consent unless otherwise required by law, determine that we should merge or consolidate through a roll-up or other similar transaction involving other entities, including entities Affiliated with our Managing Member, into or with such other entities.

· The Managing Member or its Affiliates may receive project management fees or other compensation related to the administration and management of certain Company investments.

· The Managing Member and its principals, directors, officers and/or affiliates may sell, buy or hypothecate loans (use loans as collateral for another loan) to or from the Company.

Distributions

To the extent that the Company has net income from its investment activities, the Managing Member will make distributions to the members of an amount equal to an annual preferred return (the "Preferred Return") on their investment, payable each calendar month (and prorated as applicable for the amount of time that a member was a member of the Company during such month). This Preferred Return will be payable only to the extent the Company has net income and prior to any other distributions or profit participation by the Managing Member (however, all expenses and fees will be paid and deducted from the total income prior to making to any distributions ). The Preferred Return for any member shall be equal to an annualized rate of eight percent (8.00%). The Preferred Return will be calculated and distributed on a monthly basis to the extent such amounts are available for distribution .

Members will also be eligible for regular quarterly income distributions of the Company's Net Income, as follows: Members will be eligible for quarterly income distributions of their pro-rata share of 80% of the Net Income of the Company according to the member's capital account to the extent cash is available and provided that the quarterly income distribution will not impact the continuing operations of the Company.  "Net Income" means the Company's quarterly gross income less the Company's quarterly operating expenses, management fees, payment of the Preferred Return and an allocation of income for a loan loss reserve. All Net Income distributions, if any, will be made on a quarterly basis, in arrears.

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Each member has the option of having his, her or its share of the earnings of the Company (including any Preferred Return) that is payable to the member credited to his, her or its capital accounts. However, the Managing Member reserves the right to commence making cash distributions at any time to any member(s) in order for the Company to remain exempt from the ERISA plan asset regulations. (See "ERISA Considerations" and "Summary of Operating Agreement" below). In addition, the Managing Member may elect to redeem all or a part of a member's Class A Units for any reason upon thirty (30) days written notice to the member at a price equal to the member's capital contribution plus any accrued but unpaid Preferred Return and other fees which are owed to the member on the date of redemption. The Managing Member may also, by notice to a member, force the sale of all or a portion of such member's interest on such terms as the Managing Member determines to be fair and reasonable, or take such other action as it determines to be fair and reasonable in the event that the Managing Member determines or has reason to believe that: (i) such member has attempted to effect a transfer of, or a transfer has occurred with respect to, any portion of such member's interest in violation of the Operating Agreement; (ii) continued ownership of such Class A Units by such Member is reasonably likely to cause the Company to be in violation of securities laws of the United States or any other relevant jurisdiction or the rules of any self-regulatory organization applicable to the Managing Member or its Affiliates; (iii) continued ownership of such interest by such member may be harmful or injurious to the business or reputation of the Company or the Managing Member, or may subject the Company or any members to a risk of adverse tax or other fiscal consequence, including without limitation, adverse consequence under ERISA; (iv) any of the representations or warranties made by such member in connection with the acquisition of such Member's interest was not true when made or has ceased to be true; or (v) such member's interest has vested in any other person by reason of the bankruptcy, dissolution, incompetency or death of such member.

Members shall receive cash distributions of net income in the form of quarterly income distributions and monthly distributions of Preferred Returns unless a member elects to have all such amounts credited to his, her or its capital account . An election to retain quarterly income distribution or monthly Preferred Return is revocable at any time upon a written request to revoke such election. Members may change their election at any time upon thirty (30) days written notice to the Company. Upon receipt and after the thirty (30) day notice has occurred, the member's election shall be changed and reflected on the following first day of the successive period in which the member is entitled to receive a distribution. Notwithstanding the preceding sentences, the Managing Member may at any time immediately commence with income distributions in cash only (hence, suspending the retention option for such member(s) to any member(s) in order for the Company to remain exempt from the ERISA plan asset regulations. (See "ERISA Considerations" and "Summary of Operating Agreement" below).

Prospective investors should understand that earnings, cash flow and distributions of the Company may necessarily fluctuate in accordance with the business and operations of the Company. At the end of each calendar quarter, the Managing Member will (as soon as reasonably practicable) review distributions paid during the prior quarter (i.e. the quarter prior to the quarter just ended) and make ratable adjustments to the income distributions and Preferred Return distributions paid or payable to members in order to ensure that Members receive accurate income and Preferred Return distributions.

Any distributions that we make will directly impact our NAV, by reducing the amount of our assets. Our goal is to provide a reasonably predictable and stable level of current income, through monthly or other periodic distributions, while at the same time maintaining a fair level of consistency in our NAV. Over the course of your investment, your distributions plus the change in NAV per Class A Unit (either positive or negative) will produce your total return.

Our distributions will constitute a return of capital to the extent that they exceed our current and accumulated earnings and profits as determined for U.S. federal income tax purposes. To the extent that a distribution is treated as a return of capital for U.S. federal income tax purposes, it will reduce a holder's adjusted tax basis in the holder's Class A Units, and to the extent that it exceeds the holder's adjusted tax basis will be treated as gain resulting from a sale or exchange of such Class A Units.

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Borrowing Policy

We do not plan on using leverage or borrowing to provide additional funds to support our investment activities. Our Managing Member may from time to time elect to employ leverage, if , in its discretion, it deems such a strategy to be beneficial to the holders of the Class A Units in light of then-current economic conditions, relative costs of debt and equity capital, market values of our properties, general conditions in the market for debt and equity securities, growth and acquisition opportunities or other factors. Any such financing would be in the form of one or more bank lines of credit secured by the assets of the Company . In no case shall the Company borrow more than 60% of the greater of cost (before deducting depreciation or other non-cash reserves) or fair market value of our assets. See "Investment Objectives and Strategy".

Valuation Policies

The value of our Class A Units shall initially be $10.00 per unit. Beginning March 31, 201 7, our Managing Member will calculate our NAV per Class A Unit on a quarterly basis using a process that reflects (1) estimated values of each of our real estate assets and investments, including related liabilities, provided in individual appraisal reports or internal valuation assessments of the underlying real estate, as they may be updated upon certain material events described below, (2)  accruals of our quarterly or other periodic distributions, and (3) estimates of quarterly accruals, on a net basis, of our operating revenues, expenses and fees. Our goal is to provide a reasonable estimate of the market value of our Class A Units on a quarterly basis. However, the majority of our assets will consist of real estate loans and, as with any real estate valuation protocol, the conclusions reached by our Managing Member will be based on a number of judgments, assumptions and opinions about future events that may or may not prove to be correct. The use of different judgments, assumptions or opinions would likely result in different estimates of the value of our real estate assets and investments. In addition, for any given month, our published NAV per Class A Unit may not fully reflect certain material events, to the extent that the financial impact of such events on our portfolio is not immediately quantifiable. As a result, the quarterly calculation of our NAV per Class A Unit may not reflect the precise amount that might be paid for a Class A Units in a market transaction, and any potential disparity in our NAV per Class A Unit may be in favor of either members who redeem their Class A Units, or members who buy new Class A Units, or existing members. However, to the extent quantifiable, if a material event occurs in between quarterly updates of NAV that would cause our NAV per Class A Unit to change by 5% or more from the last disclosed NAV, we will disclose the updated price and the reason for the change in an offering circular supplement as promptly as reasonably practicable, and will update the NAV information provided on our website.

NAV Share Price Adjustments

Our Managing Member set our initial offering price at $10.00 per Class A Unit, which will be the purchase price of our Class A Units until March 31, 2016. Thereafter, the per Class A Unit purchase price will be adjusted quarterly on the first day of the month and will be equal to our NAV divided by the number of Class A Units outstanding as of the close of business on the last business day of the prior month, in each case prior to giving effect to any share purchases or redemptions to be effected on such day

Beginning after March 31, 2016, we will file with the SEC on a quarterly basis an offering circular supplement disclosing the quarterly determination of our NAV per Class A Unit that will be applicable for such month, which we refer to as the pricing supplement. We will disclose, on a quarterly basis in an offering circular supplement filed with the SEC, the principal valuation components of our NAV. In addition, if a material event occurs in between quarterly updates of NAV that would cause our NAV per Class A Unit to change by 5% or more from the last disclosed NAV, we will disclose the updated price and the reason for the change in an offering circular supplement as promptly as reasonably practicable, and will update the NAV information provided on our website.

Any subscriptions that we receive prior to the a quarter will be executed at a price equal to our NAV per Class A Unit applicable to such quarter. A subscription will not close until all capital contribution funds are received.  In the event of a change in the price after a subscription agreement is received but prior to the closing of such subscription, the subscriber(s) will receive updated pricing information and will have the opportunity to rescind their subscription based upon the updated pricing . See "Description of Our Class A Units—NAV Share Price Adjustments" for more details.

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Redemptions

Until such time as the Class A Units are listed on the OTCQB, the holders of Class A Units may request redemptions of the Class A Units in accordance with the Company's redemption plan, including following procedures and restrictions. At any time after 15 (fifteen) months following the purchase of Class A Units, a member may request that the Company redeem those Class A Units by giving the Managing Member no less than 90 days' notice.

We will redeem Class A Units on the first day of each calendar quarter as set forth below, provided that the requisite 90-day written notice of redemption from members is received. All requests for redemption must be received by the Company at least ninety days prior to the end of the applicable quarter. Members may withdraw their redemption request at any time prior to redemption date. Withdrawal requests must be received by the Company prior to the end of the applicable quarter. If the percentage of our Class A Units subject to redemption requests exceeds the then applicable limitations, each member's request will be reduced on a pro rata basis at the end of the applicable quarter. In addition, if the Company does not have such sufficient funds available, at the time when redemption is requested, participants can (i) withdraw their request for redemption or (ii) ask that the Company honor their request at such time, if any, when sufficient funds become available. Such pending requests will generally be honored on a pro-rata basis .  

During the Offering period, the redemption price will be equal to $9.00 per unit, or 90% of the offering price.   Following the termination of the Offering, the redemption price will be based upon the most current NAV on the date of the distribution.

  In this situation, because the Company is not required to make a redemptive distributions until the first day of the quarter which is no less than 90 days following the request and the NAV per Class A Unit will be calculated at the beginning of each month, the redemption price may change between the date we receive the redemption request and the date on which redemption proceeds are paid. As a result, the redemption price that a member will receive may be different from the redemption price on the day the redemption request is made. The redemption price will be reduced by the aggregate sum of distributions, if any, declared on the Class A Units subject to the redemption request with record dates during the period between the redemption request date and the redemption date .

We are not obligated to redeem Class A Units. In no case shall  the number of Class A Units to be redeemed during any calendar year exceed  10.0% of the weighted average number of Class A Units outstanding during the prior calendar year.

In addition, the Managing Member may, in its sole discretion, amend, suspend, or terminate the redemption plan at any time without notice, including to protect our operations and our non-redeemed members, to prevent an undue burden on our liquidity, to preserve or facilitate our tax status, following any material decrease in our NAV, or for any other reason. The Managing Member may also, in its sole discretion, decline any particular redemption request if it believes such action is necessary to preserve or facilitate our tax status. Therefore, you may not have the opportunity to make a redemption request prior to any potential termination of our redemption plan.

The redemption plan shall cease if and when the Company lists the Class A Units on a trading market or exchange .  Please refer to the section entitled "Description of Our Class A Units—Redemptions" for more information.

OTC Listing

We intend to contact an authorized OTCQB market maker for sponsorship of our securities on the OTCQB, upon qualification of this Form 1-A. However, there is no guarantee our Class A Units will be accepted for quotation on the OTCQB.

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Voting Rights

Our Class A Unitholders will have voting rights only with respect to certain matters, primarily relating to amendments to our Operating Agreement that would adversely change the rights of the Class A Units, and removal of our Managing Member for "cause".  Each outstanding Class A Unit entitles the holder to one vote on all matters submitted to a vote of Class A Unitholders.  Our members do not elect or vote on our Managing Member, and, unlike the holders of common stock in a corporation, have only limited voting rights on matters affecting our business, and therefore limited ability to influence decisions regarding our business. For additional information, see "Description of Our Class A Units—Voting Rights."

Other Governance Matters

Other than the limited member voting rights described above, our Operating Agreement vests most other decisions relating to our assets and to the business of our company, including decisions relating to acquisitions, originations and dispositions, the engagement of asset managers, the issuance of securities in our company including additional Class A Units, mergers, dispositions, roll-up transactions, and other decisions relating to our business, in our Managing Member. See "Management" for more information about the rights and responsibilities of our Managing Member.

Investment Company Act Considerations

We intend to conduct our operations so that neither we, nor any of our subsidiaries, are required to register as investment companies under the Investment Company Act of 1940, as amended (the "Investment Company Act"). Section 3(a)(1)(A) of the Investment Company Act defines an investment company as any issuer that is or holds itself out as being engaged primarily in the business of investing, reinvesting or trading in securities. Section 3(a)(1)(C) of the Investment Company Act defines an investment company as any issuer that is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire investment securities having a value exceeding 40% of the value of the issuer's total assets (exclusive of U.S. Government securities and cash items) on an unconsolidated basis, which we refer to as the 40% test. Excluded from the term "investment securities," among other things, are U.S. Government securities and securities issued by majority-owned subsidiaries that are not themselves investment companies and are not relying on the exception from the definition of investment company set forth in Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act. 

We intend to conduct our operations so that they comply with the 40% test . We will monitor our holdings to ensure continuing and ongoing compliance with this test. In addition, we believe that we will not be considered an investment company under Section 3(a)(1)(A) of the Investment Company Act because we will not engage primarily or hold ourselves out as being engaged primarily in the business of investing, reinvesting or trading in securities. Rather, we expect that most of our assets will be held through wholly owned or majority owned subsidiaries and that these  subsidiaries will be primarily engaged in the non-investment company businesses.

We expect that most of these subsidiaries will be outside the definition of investment company under Section 3(a)(1) of the Investment Company Act and will be able to rely upon the exclusion from the definition of "investment company" provided by Section 3(c)(5)(C) of the Investment Company Act. Section 3(c)(5)(C), as interpreted by the staff of the SEC, requires each entity relying on this exception to invest at least 55% of its portfolio in "mortgage and other liens on and interests in real estate," which we refer to as "qualifying real estate assets " and maintain at least 80% of its assets in qualifying real estate assets or other real estate-related assets.  The classification of our assets for purposes of the Investment Company Act will be based in large measure upon no-action letters issued by the SEC staff in the past and other SEC interpretive guidance.

In the event that we were to acquire assets that could make either entity fall within the definition of investment company under Section 3(a)(1) of the Investment Company Act, we believe that we would still qualify for an exclusion from registration pursuant to Section 3(c)(6). Section 3(c)(6) excludes from the definition of investment company any company primarily engaged, directly or through majority owned subsidiaries, in one or more of certain specified businesses. These specified businesses include the real estate business described in Section 3(c)(5)(C) of the Investment Company Act. It also excludes from the definition of investment company any company primarily engaged, directly or through majority owned subsidiaries, in one or more of such specified businesses from which at least 25% of such company's gross income during its last fiscal year is derived, together with any additional business or businesses other than investing, reinvesting, owning, holding, or trading in securities. Although the SEC staff has issued little interpretive guidance with respect to Section 3(c)(6), we believe that we may rely on Section 3(c)(6) if 55% of our assets consist of, and at least 55% of our income is derived from, qualifying real estate assets owned by our wholly owned or majority owned subsidiaries.

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Qualification for exemption from registration under the Investment Company Act will limit our ability to make certain investments. To the extent that the SEC staff provides more specific guidance regarding any of the matters bearing upon such exclusions, we may be required to adjust our strategy accordingly. Any additional guidance from the SEC staff could provide additional flexibility to us, or it could further inhibit our ability to pursue the strategies we have chosen.

The loss of our exclusion from regulation pursuant to the Investment Company Act could require us to restructure our operations, sell certain of our assets or abstain from the purchase of certain assets, which could have an adverse effect on our financial condition and results of operations. See "Risk Factors—Risks related to Our Organizational Structure—Maintenance of our Investment Company Act exemption imposes limits on our operations, which may adversely affect our operations."

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The Offering

       We are offering to investors the opportunity to purchase up to a maximum of $50,000,000 of Class A Units, subject to a minimum offering amount of $500,000.00. The offering will continue through the earlier of December 31, 2017 or the date upon which all $50,000,000 in offering proceeds have been received. Following qualification of the Offering Statement, the Company will conduct closings in this offering at its discretion, or the Closing Dates and each, a Closing Date, until the Offering Termination. The Company reserves the right to extend the offering if the maximum target amount has not been reached by December 31, 2017.

Issuer	Secured Real Estate Income Fund II, LLC, a Delaware limited liability company
Securities Offered	Class A Membership Interest Units ("Class A Units").
Use of Proceeds	We estimate that the net proceeds of this offering will be approximately $45,350,000, after deducting sales commissions of 7.0% of the offering proceeds payable to the placement agents that we engage for this offering, a non-accountable expense allowance of 1.50% of the offering proceeds payable to the placement agents, a platform fee of 0.50% of the gross proceeds from this offering payable to Folio for its clearing and facilitation services and $150,000 in expenses incurred by us in connection with this offering. Specified sales may be made net of selling commissions, accountable expense allowance and non-accountable expense allowance. See "Plan of Distribution." We intend to use the net proceeds from this offering to originate and acquire real estate loans in our target asset class and repay bridge loans used to acquire assets, which may include loans from Affiliates.
No Listing	Currently, there is no public market for our Class A Units. We do, however, plan to identify a market maker who will file an application on Form 211 with FINRA following the qualification of the Offering Statement of which this offering circular forms a part and take such other action as is required with OTC Markets, Inc. to have our securities quoted on the OTCQB as soon as practicable following the qualification of our Offering Statement.
Governing Law	The Company and the Class A Units will be governed by the laws of the State of Delaware.
Risk Factors Distribution Policy	An investment in the Units involves certain risks. You should carefully consider the risks described under "Risk Factors" beginning on page 20 of this Offering Circular before making an investment decision. To the extent the Company has cash available for distribution, we expect to make monthly distributions of income received from investments in an annual amount of eight percent (8%) as a preferred return to the holders of the Class A Units and quarterly distributions of eighty percent (80%) of the net income.

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RISK FACTORS

An investment in our Class A Units involves substantial risks. You should carefully consider the following risk factors in addition to the other information contained in this offering circular before purchasing Class A Units. The occurrence of any of the following risks might cause you to lose a significant part of your investment. The risks and uncertainties discussed below are not the only ones we face, but do represent those risks and uncertainties that we believe are most significant to our business, operating results, prospects and financial condition. Some statements in this offering circular, including statements in the following risk factors, constitute forward-looking statements. Please refer to the section entitled "Statements Regarding Forward-Looking Information."

Risks Related to an Investment in Secured Real Estate Investment Fund

We have no prior operating history, and the prior performance of other real estate investment opportunities sponsored by our Managing Member may not predict our future results.

We are a recently formed company. As of the date of this offering circular, we have not made any investments. Upon closing, we will make investments into Loans and other real estate assets ("Real Assets"). You should not assume that our performance will be similar to the past performance of our Managing Member or other real estate investment opportunities managed or sponsored by members of Managing Member. Our lack of an operating history significantly increases the risk and uncertainty you face in making an investment in our Class A Units.

Because no public trading market for the Class A Units currently exists, it will be difficult for you to sell your Class A Units and, if you are able to sell your Class A Unitssuch sale may be at a loss

Our Operating Agreement does not require our Managing Member to seek member approval to liquidate our assets by a specified date, nor does our Operating Agreement require our Managing Member to list our Class A Units for trading on a national securities exchange by a specified date. There is no public market for our Class A Units, however, we do plan to list our Class A Units on the OTCQB or other trading market in the near future. Until our Class A Units are listed, if ever, you may not sell your Class A Units unless the buyer meets the applicable suitability and minimum purchase standards. In its sole discretion, including to protect our operations and our non-redeemed members or to prevent an undue burden on our liquidity, our Managing Member could amend, suspend or terminate our redemption plan without notice. Further, our Operating Agreement includes numerous restrictions that would limit your ability to sell your Class A Units. We describe these restrictions in more detail under "Description of Our Class A Units — Redemptions." Therefore, it will be difficult for you to sell your Class A Units promptly or at all. If you are able to sell your Class A Units, you would likely have to sell them at a substantial discount to their public offering price. It is also likely that your Class A Units would not be accepted as the primary collateral for a loan. Because of the illiquid nature of our Class A Units, you should purchase our Class A Units only as a long-term investment and be prepared to hold them for an indefinite period of time.

If we are unable to find suitable investments, we may not be able to achieve our investment objectives or pay distributions.

Our ability to achieve our investment objectives and to pay distributions depends upon the performance of our Managing Member and Investment Manager in the origination, acquisition and servicing of Loans, Real Assets and other similar investments. In some cases, we may also depend upon the performance of third-party loan servicers to service our Loans and other similar investments. Except for investments that may be described in supplements to this offering circular prior to the date you subscribe for our Class A Units, you will have no opportunity to evaluate the economic merits or the terms of our investments before making a decision to invest in our company. You must rely entirely on the management abilities of our Managing Member, Investment Manager and the loan servicers our Managing Member may select. We cannot assure you that our Investment Manager will be successful in originating or obtaining suitable Loans and Real Assets on financially attractive terms or that, if our Managing Member makes investments on our behalf, our objectives will be achieved. If we, through our Managing Member, are unable to find suitable investments promptly, we will hold the proceeds from this offering in an interest-bearing account or invest the proceeds in short-term assets in a manner described herein. In the event we are unable to timely locate suitable investments, we may be unable or limited in our ability to pay distributions and we may not be able to meet our investment objectives.

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Future disruptions in the financial markets or deteriorating economic conditions could adversely impact the real estate market as well as the market for debt-related investments generally, which could hinder our ability to implement our business strategy and generate returns to you.

We intend to originate and acquire a diversified portfolio of real estate loans and other investments in real estate. We may also invest in real estate-related debt securities, and other real estate-related assets. Economic conditions greatly increase the risks of these investments (see "Risks Related to Our Investments"). The value of collateral securing any loan investment we may make could decrease below the outstanding principal amount of such loan. In addition, revenues on the properties and other assets underlying any loan investments we may make could decrease, making it more difficult for borrowers to meet their payment obligations to us. Each of these factors would increase the likelihood of default and foreclosure, which would likely have a negative impact on the value of our loan investment. More generally, the risks arising from the financial market and economic conditions are applicable to all of the investments we may make. The risks apply to commercial mortgage, priority and subordinate debt and bridge loans.

Future disruptions in the financial markets or deteriorating economic conditions may also impact the market for our investments and the volatility of our investments. The returns available to investors in our targeted investments are determined, in part, by: (i) the supply and demand for such investments and (ii) the existence of a market for such investments, which includes the ability to sell or finance such investments. During periods of volatility, the number of investors participating in the market may change at an accelerated pace. If either demand or liquidity increases, the cost of our targeted investments may increase. As a result, we may have fewer funds available to make distributions to investors.

All of the factors described above could adversely impact our ability to implement our business strategy and make distributions to our investors and could decrease the value of an investment in us.

We may suffer from delays in locating suitable investments, which could limit our ability to make distributions and lower the overall return on your investment.

We rely upon the experience and knowledge of the officers, managers and principals of the Investment Manager and Managing Member, including Thomas Braegelmann, Charles Tralka, Matthew Sullivan and Robert Barr, to identify and structure suitable investments. To the extent that our Investment Manager's and Managing Member's real estate and debt finance professionals face competing demands upon their time in instances when we have capital ready for investment, we may face delays in execution. Further, because we are raising capital without any pre-selected assets, it may be difficult for us to invest the net offering proceeds promptly and on attractive terms. Delays we encounter in the selection and origination of Loans and Real Assets would likely limit our ability to pay distributions to our members and lower their overall returns. Similar concerns arise when there are prepayments, maturities or sales of our investments. See "—Prepayments can adversely affect the yields on our investments" below.

Because this is a blind pool offering, you will not have the opportunity to evaluate our investments before we make them, which makes your investment more speculative.

Because we have made only a limited number of investments and have not yet acquired or identified a majority of the investments that we may make, we are not able to provide you with any information to assist you in evaluating the merits of most of the specific investments that we may make, except for investments that may be described in supplements to this offering circular. We will seek to invest substantially all of the offering proceeds available for investment, after the payment of fees and expenses, in Loans real estate and other real estate-related assets. However, because you will be unable to evaluate the economic merit of assets before we invest in them, you will have to rely entirely on the ability of our Investment Manager to select suitable and successful investment opportunities. Furthermore, our Investment Manager and Managing Member will have broad discretion in implementing policies regarding mortgagor creditworthiness and you will not have the opportunity to evaluate potential borrowers. These factors increase the risk that your investment may not generate returns comparable to our competitors.

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Our Managing Member and Investment Manager are not investors in the Company.

Except for reimbursable funds expended in connection with the organization of the Company and its offerings, our Managing Member and Investment Manager have not provided investment capital to Company in exchange for their Class B Units. Therefore, if we are successful in raising enough proceeds to be able to reimburse our Managing Member for our organization and offering expenses, our Managing Member will have little exposure to loss in the value of the Class A Units. Without this exposure, our investors may be at a greater risk of loss because our Managing Member does not have as much to lose from a decrease in the value of the Class A Units as do those sponsors or managers who make more significant equity investments in their companies.

Because we are limited in the amount of funds we can raise, we will be limited in the number and type of investments we make and the value of your investment in us will fluctuate with the performance of the specific assets we acquire.

This offering is being made on a "best efforts" basis and we may begin to invest net proceeds from this offering immediately after the commencement of this offering. Further, under Regulation A, we are only allowed to raise up to $50 million in any 12-month period (although we may raise capital in other ways). If we raise the full $50,000,000, we expect the size of the real estate loans and equity investments that we will make will average about $500,000 and $1 million to $5 million per asset. As a result, the amount of proceeds we raise in this offering may be substantially less than the amount we would need to achieve a diversified portfolio of investments, even if we are successful in raising the maximum offering amount. If we are unable to raise substantial funds, we will make fewer investments resulting in less diversification in terms of the type, number and size of investments that we make. In that case, the likelihood that any single asset's performance would adversely affect our profitability will increase. Your investment in our Class A Units will be subject to greater risk to the extent that we lack a diversified portfolio of investments. Further, we will have certain fixed operating expenses, including certain expenses as a public reporting company, regardless of whether we are able to raise substantial funds in this offering. Our inability to raise substantial funds would increase our fixed operating expenses as a percentage of gross income, reducing our net income and limiting our ability to make distributions.

Any adverse changes in our relationship with our Managing Member and Investment Manager or their Affiliates could hinder our operating performance and the return on your investment.

We have engaged our Investment Manager and Managing Member to select and manage our operations and our portfolio of real estate loans, real estate and other real estate-related assets. Our ability to achieve our investment objectives and to pay distributions is dependent upon the performance of our Managing Member and Investment Manager and their Affiliates as well as their respective real estate and debt finance professionals in the identification and acquisition or origination of investments, the management of our assets and operation of our day-to-day activities. Any adverse changes in the financial condition of, or our relationship with, the Managing Member and Investment Manager could hinder our ability to successfully manage our operations and our portfolio of investments.

There will be delays between the time an investor purchases Class A Units and when the Company makes investments in Loans and Real Assets.

There may be a delay between the time an investor purchases Class A Units and the time the proceeds of are invested in Loans and Real Assets by the Company. During these periods, the Company may invest these proceeds in short-term certificates of deposit, money-market funds or other liquid assets with FDIC-insured and/or NCUA-insured banking institutions which will not yield a return as high as the anticipated return to be earned on LLC loans and property investments.

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If we do not successfully implement a liquidity transaction, you may have to hold your investment for an indefinite period.

Although we intend to seek to list the Class A Units on the OTCQB in the near future, our Operating Agreement does not require our Managing Member to pursue liquidity for the Class A Units. Market conditions and other factors could cause us to delay the listing of our Class A Units on a national securities exchange or delay the commencement of a liquidation or other type of liquidity transaction, such as a merger or sale of assets. If we adopt a plan of liquidation, the timing of the sale of assets will depend on real estate and financial markets, economic conditions in areas in which properties are located, and federal income tax effects on members, that may prevail in the future. We cannot guarantee that we will be able to liquidate all assets. After we adopt a plan of liquidation, we would likely remain in existence until all our investments are liquidated. If we do not list our Class A Units on a national securities exchange, pursue a liquidity transaction, or delay such a transaction due to market conditions, your Class A Units may continue to be illiquid and you may, for an indefinite period of time, be unable to convert your investment to cash easily and could suffer losses on your investment.

We may change our targeted investments and investment guidelines without member consent.

Our Managing Member may change our targeted investments and investment guidelines at any time without the consent of our members, which could result in our making investments that are different from, and possibly riskier than, the investments described in this offering circular. A change in our targeted investments or investment guidelines may increase our exposure to interest rate risk, default risk and real estate market fluctuations, all of which could adversely affect the value of our Class A Units and our ability to make distributions to you.

If our Managing Member fails to retain its key personnel, we may not be able to achieve our anticipated level of growth and our business could suffer.

Our future depends, in part, on our Managing Member's and Investment Manager's ability to attract and retain key personnel. Our future also depends on the continued contributions of the executive officers and other key personnel of our Managing Member, each of whom would be difficult to replace. In particular, Thomas Braegelmann, Charles Tralka, Matthew Sullivan and Robert Barr critical to the management of our business and operations and the development of our strategic direction. The loss of the services of Messrs. Braegelmann, Tralka, Sullivan and Barr or other executive officers or key personnel of our Managing Member and the process to replace any of our Managing Member's key personnel would involve significant time and expense and may significantly delay or prevent the achievement of our business objectives.

We have minimal operating capital, no significant assets and no revenue from operations.

We have minimal operating capital and for the foreseeable future will be dependent upon our ability to finance our operations from the sale of equity or other financing alternatives.  There can be no assurance that we will be able to successfully raise operating capital.  The failure to successfully raise operating capital, and the failure to identify opportunities for Loans and Real Assets and sufficient investor purchase commitments, could result in our bankruptcy or other event which would have a material adverse effect on us and our members.  We have no significant assets or financial resources, so such adverse event could put your investment dollars at significant risk.

Risks Related to Real Estate Investments.

Our real estate loans, investments in real estate and other real estate-related assets will be subject to the risks typically associated with real estate.

Our Loans will generally be directly or indirectly secured by a lien on real property that, upon the occurrence of a default on the loan, could result in our acquiring ownership of the property. We will not know whether the values of the properties ultimately securing our loans will remain at the levels existing on the dates of origination of those loans. If the values of the mortgaged properties drop, our risk will increase because of the lower value of the security associated with such loans. In this manner, real estate values could impact the values of our loan investments. Our investments in real estate-related debt securities and real estate investments (including investments in real property) may be similarly affected by real estate property values. Therefore, our investments will be subject to the risks typically associated with real estate. The value of real estate may be adversely affected by a number of risks, including:

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· natural disasters such as hurricanes, earthquakes and floods;

· acts of war or terrorism, including the consequences of terrorist attacks;

· adverse changes in national and local economic and real estate conditions;

· an oversupply of (or a reduction in demand for) space in the areas where particular properties are located and the attractiveness of particular properties to prospective tenants;

· political changes, changes in governmental laws and regulations, fiscal policies and zoning ordinances and the related costs of compliance therewith and the potential for liability under applicable laws;

· costs of remediation and liabilities associated with environmental conditions affecting properties; and

· the potential for uninsured or underinsured property losses.

The value of each property is affected significantly by its ability to generate cash flow and net income, which in turn depends on the amount of rental or other income that can be generated net of expenses required to be incurred with respect to the property. Many expenditures associated with properties (such as operating expenses and capital expenditures) cannot be reduced when there is a reduction in income from the properties. These factors may have a material adverse effect on the ability of our borrowers to pay their loans, as well as on the value that we can realize from assets we originate, own or acquire.

In addition, to the extent we make equity investments in real estate, such investments will be subject to all of the risks associated with real estate described above.

We have no established investment criteria limiting the geographic concentration of our investments in real estate loans, real estate and other real estate-related assets. If our investments are concentrated in an area that experiences adverse economic conditions, our investments may lose value and we may experience losses.

Certain real estate loans, investments in real estate and other real estate-related assets in which we invest may be in or secured by a single property or properties in one geographic location. These investments may carry the risks associated with significant geographical concentration. We have not established and do not plan to establish any investment criteria to limit our exposure to these risks for future investments. As a result, properties underlying our investments may be overly concentrated in certain geographic areas, and we may experience losses as a result. A worsening of economic conditions in the geographic area in which our investments may be concentrated could have an adverse effect on our business, including reducing the demand for new financings, limiting the ability of customers to pay financed amounts and impairing the value of our collateral.

Changes in interest rates and/or credit spreads could negatively affect the value of our investments, which could result in reduced earnings or losses and negatively affect the cash available for distribution to our members.

We will invest in fixed-rate debt investments with fixed distribution amounts. Under a normal yield curve, an investment in these instruments will decline in value if long-term interest rates increase or if credit spreads widen. We may also invest in floating-rate debt investments, for which decreases in interest rates or narrowing of credit spreads will have a negative effect on value and interest income. Even though a loan or other debt investment may be performing in accordance with its loan agreement and the underlying collateral has not changed, the economic value of the loan may be negatively impacted by the incremental interest foregone from the changes in interest rates or credit spreads. Declines in market value may ultimately reduce earnings or result in losses to us, which may negatively affect cash available for distribution to our members.

Real estate equity investments will be subject to risks inherent in ownership of real estate.

Real estate cash flows and values are affected by a number of factors, including competition from other available properties and our ability to provide adequate property maintenance and insurance and to control operating costs. Real estate cash flows and values are also affected by such factors as government regulations (including zoning, usage and tax laws), interest rate levels, the availability of financing, property tax rates, utility expenses, potential liability under environmental and other laws and changes in environmental and other laws. Real estate equity investments that we make will be subject to such risks.

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Many of our investments are illiquid and we may not be able to vary our portfolio in response to changes in economic and other conditions.

The illiquidity of our target investments may make it difficult for us to sell such investments if the need or desire arises. Loans and Real Assets will be particularly illiquid investments due to their short life and the greater difficulty of recoupment in the event of a borrower's default. As a result, we expect many of our investments will be illiquid, and if we are required to liquidate all or a portion of our portfolio quickly, we may realize significantly less than the value at which we have previously recorded our investments and our ability to vary our portfolio in response to changes in economic and other conditions may be relatively limited, which could adversely affect our results of operations and financial condition.

Declines in the market values of our investments may adversely affect periodic reported results of operations and credit availability, which may reduce earnings and, in turn, cash available for distribution to our members.

Some of our assets will be classified for accounting purposes as "available-for-sale." These investments are carried at estimated fair value and temporary changes in the market values of those assets will be directly charged or credited to members' equity without impacting net income on the income statement. Moreover, if we determine that a decline in the estimated fair value of an available-for-sale security falls below its amortized value and is not temporary, we will recognize a loss on that security on the income statement, which will reduce our earnings in the period recognized.

Market values of our investments may decline for a number of reasons, such as changes in prevailing market rates, increases in defaults, increases in voluntary prepayments for those investments that we have that are subject to prepayment risk, widening of credit spreads and downgrades of ratings of the securities by ratings agencies.

A prolonged economic slowdown, a lengthy or severe recession or declining real estate values could harm our operations.

Many of our investments may be susceptible to economic slowdowns or recessions, which could lead to financial losses in our investments and a decrease in revenues, net income and assets. An economic slowdown or recession, in addition to other non-economic factors such as an excess supply of properties, could have a material negative impact on the values of both real estate and residential real estate properties. Borrowers may also be less able to pay principal and interest on our loans if the real estate economy weakens. Further, declining real estate values significantly increase the likelihood that we will incur losses on our loans in the event of default because the value of our collateral may be insufficient to cover our cost on the loan. Any sustained period of increased payment delinquencies, foreclosures or losses could adversely affect our net interest income from loans in our portfolio, which would significantly harm our revenues, results of operations, financial condition, business prospects and our ability to make distributions to you.

If we overestimate the value or income-producing ability or incorrectly price the risks of our investments, we may experience losses.

Analysis of the value or income-producing ability of a commercial property is highly subjective and may be subject to error. Our Investment Manager and Managing Member will value our potential investments based on yields and risks, taking into account estimated future losses on the real estate loans and the mortgaged property and the estimated impact of these losses on expected future cash flows and returns. In the event that we underestimate the risks relative to the price we pay for a particular investment, we may experience losses with respect to such investment.

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A borrower's form of entity may cause special risks or hinder our recovery.

Since most of the borrowers for our real estate loan investments are legal entities rather than individuals, our risk of loss may be greater than those of mortgage loans made to individuals. Unlike individuals involved in bankruptcies, most of the entities generally do not have personal assets and creditworthiness at stake. The terms of the mortgage loans generally require that the borrowers covenant to be single-purpose entities, although in some instances the borrowers are not required to observe all covenants and conditions that typically are required in order for them to be viewed under standard rating agency criteria as "single-purpose entities." Borrowers' organizational documents or the terms of the mortgage loans may limit their activities to the ownership of only the related mortgaged property or properties and limit the borrowers' ability to incur additional indebtedness. These provisions are designed to mitigate the possibility that the borrowers' financial condition would be adversely impacted by factors unrelated to the mortgaged property and the mortgage loan in the pool.

The bankruptcy of a borrower, or a general partner or managing member of a borrower, may impair the ability of the lender to enforce its rights and remedies under the related mortgage.

The market in which we participate is competitive and, if we do not compete effectively, our operating results could be harmed.

The real estate lending market is competitive and rapidly changing. We expect competition to persist and intensify in the future, which could harm our ability to increase volume on our platform.

Our principal competitors include major banking institutions, private equity funds, real estate investment trusts, hedge funds, private money lenders, other mortgage funds, private investors, institutional lenders and investors, others engaged in the mortgage lending and property acquisition businesses as well as online lending platforms. Competition could result in reduced volumes, reduced fees or the failure of the Company to achieve or maintain more widespread market acceptance, any of which could harm our business. In addition, in the future we may experience new competition from more established internet companies possessing large, existing customer bases, substantial financial resources and established distribution channels. If any of these companies or any major financial institution decided to enter the online lending business, acquire one of our existing competitors or form a strategic alliance with one of our competitors, our ability to compete effectively could be significantly compromised and our operating results could be harmed.

Most of our current or potential competitors have significantly more financial, technical, marketing and other resources than we do and may be able to devote greater resources to the development, promotion, sale and support of their investment platforms and distribution channels. Our potential competitors may also have longer operating histories, more extensive customer bases, greater brand recognition and broader customer relationships than we have. These competitors may be better able to develop new products, to respond quickly to new technologies and to undertake more extensive marketing campaigns.

Distributions to members will be dependent upon payments received on Loan and Real Assets.

The Company will only make distributions to its members after it receives income from a Loan or Real Asset, including rental income or liquidation proceedings on a foreclosed property, or a borrower's payment on the corresponding Loan. With regards to Loans, the Company also will retain from the funds received from the relevant borrower and otherwise available for payment on the Loans any non-sufficient funds fees and the amounts of any attorneys' fees or collection fees it, a third-party servicer or collection agency imposes in connection with collection efforts. If the Company does not receive any or all payments on the corresponding Loans, distributions made to you will be correspondingly reduced in whole or in part. If the relevant borrower does not make a payment on a specific monthly loan payment date, no distribution will be made to you.

The Managing Member will not create or contribute funds to a separate account in order to fund requests for withdrawal from the Company and redemption of your investment. Because funds are not set aside periodically to fund such withdrawals, you must rely on cash flow from the Loan payoffs and the sale of Loans or Real Assets; however, to the extent the Managing Member is unable to liquidate Loans or Real Assets, any Class A Units which are unredeemed will remain subject to Company operations, which may include Company losses.

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The Loans are not guaranteed or insured by any third party.

The Loans (or the components thereof) will be secured by a mortgage, deed of trust, security agreement, or other document providing a security interest in the collateral property. The Loans are not guaranteed or insured by any governmental agency or instrumentality or any third party. If a borrower fails to make any payments on the corresponding Loan, you not receive any payments and will not receive proceeds until the Loan or collateral has been liquidated. You will not be able to pursue collection against the borrower, the Company or any other person and are prohibited from contacting the borrower about the defaulted Loan.

You may experience losses as the result of defaults on Loans.

If a corresponding Loan becomes past due or is otherwise in default, the Company may need to foreclose on the property underlying the corresponding Loan at a foreclosure sale unless the property is purchased by a third party bidder at the foreclosure sale. The Company or one of its Affiliates may act as manager for the foreclosed real estate, and the costs of foreclosure will be advanced by the Company or its Affiliate, but if the Company cannot quickly sell such property and the property does not produce any significant income, the cost of owning, maintaining, and selling the property would reduce any proceeds gained through the sale. If the foreclosed real estate cannot be sold for net proceeds that can fully return the outstanding amount of the related Loans, you will lose part or all of your investment.

For some non-performing Loans, the Company may not be able to recover any of the unpaid loan balance and, as a result, you may receive little, if any, of the unpaid principal and interest payable under the Note as a return of the capital contribution. You must rely on the collection efforts of the Company or the applicable collection agency to which such corresponding Loans are referred. You are not permitted to attempt to collect payments on the corresponding Loans in any manner.

Economic factors may increase loan loss rates.

Loss rates on Loans may be significantly affected by economic downturns or general economic conditions beyond the Company's control and beyond the control of individual borrowers. In particular, loss rates on corresponding Loans may increase due to factors such as (among other things) local real estate market conditions, prevailing interest rates, the rate of unemployment, the level of consumer confidence, the value of the U.S. dollar, energy prices, changes in consumer spending, the number of personal bankruptcies, disruptions in the credit markets and other factors.

Management discretion regarding Loans.

The Investment Manager and Managing Member will manage the Loans and Real Assets on behalf of the Company as they see fit. The Investment Manager and Managing Member may use strategies that are not described herein, and these strategies may subject the Loans to additional risks.

Usury laws may affect Loans

Certain states where the properties are located have usury laws in place that limit the maximum interest rate of the borrower loan. At times, these laws may effectively affect payments by preventing the recovery of certain payment amounts. Further, usury laws may be subject to change at the hands of state legislators. If a borrower were to succeed in bringing a claim against the Company for a state law usury violation, and the court were to find that the rate charged exceeded the maximum allowable rate applicable in such state, not only would the borrower loan not receive the anticipated full value of its loan investment, but it could be subject to fines and other penalties.

The Company will depend upon borrowers and other parties for certain aspects of the Loans.

With respect to each Loan, the borrower or developer is responsible for various management functions that are essential to the success of the investment, including property development, property marketing and leasing rates, payment of bills, maintenance of insurance, and property management generally. Poor management on the part of the borrower or developer could adversely affect the financial performance of the corresponding Loan or expose it to unanticipated operating risks, which could reduce the property's cash flow and adversely affect the borrower's ability to repay the corresponding Loan.

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If the information supplied by borrowers or developers is inaccurate or intentionally false, such loans may result in higher rates of default.

In connection with the underwriting of the Loans and Real Assets, the Investment Manager and Managing Member will obtain a variety of information regarding the current rental income, property valuations, market data, and other information. The Investment Manager and Managing Member will use its best efforts to verify this information, but some information may be incomplete, inaccurate or intentionally false. Borrowers and developers may also misrepresent their intentions for the use of investment proceeds. The Investment Manager and Managing Member does not verify any statements by applicants as to how proceeds are to be used. If a borrower or developer supplies false, misleading or inaccurate information, you may lose all or a portion of your investment in the Loan or Real Assets.

With the exception of loans which have a draw feature coupled with them, when the Company finances a corresponding Loan, its primary assurances that the financing proceeds will be properly spent by the borrower or developer are the contractual covenants agreed to by the borrower or developer, along with their business history and reputation. Should the proceeds of a financing be diverted improperly, the borrower or developer might become insolvent, which could cause you to suffer losses on your entire investment.

Uninsured losses on the Loans and Real Assets will result in losses.

The Managing Member will require title, fire and casualty insurance on the properties securing the Loans and on the Real Assets. The Managing Member may also, but is not required to, arrange for earthquake and/or flood insurance. However, there are certain types of losses (generally of a catastrophic nature) which are either uninsurable or not economically insurable, such as losses due to war, floods or mudslide. Should any such disaster occur, the Company could suffer a loss of principal and interest on a Loan secured by the uninsured property. Additionally, the Managing Member does not intend to require mortgage insurance on the Loans, which would protect the Company from losses due to defaults by mortgage borrowers.

Rises in insurance costs could affect your returns.

Real estate properties are typically insured against risk of fire damage and other typically insured property casualties, but are sometimes not covered by severe weather or natural disaster events such as landslides, earthquakes, or floods. Changes in the conditions affecting the economic environment in which insurance companies do business could affect the borrower's ability to continue insuring the property at a reasonable cost or could result in insurance being unavailable altogether. Moreover, any hazard losses not then covered by the borrower's insurance policy would result in the corresponding Loan becoming significantly undersecured or the property being at risk, and an Investor could sustain a significant reduction, or complete elimination of, the return on investment.

Environmental issues may affect the operation of a property.

If toxic environmental contamination is discovered to exist on a property underlying a corresponding Loan, it might affect the borrower's ability to repay the corresponding Loan and the Company could suffer from a devaluation of the loan security. To the extent that the Company is forced to foreclose and/or operate such a property, potential additional liabilities include reporting requirements, remediation costs, fines, penalties and damages, all of which would adversely affect the likelihood that Investors would receive a return of capital on their Class A Units.

Of particular concern may be those properties that are, or have been, the site of manufacturing, industrial or disposal activity. These environmental risks may give rise to a diminution in value of the security property or liability for clean-up costs or other remedial actions. This liability could exceed the value of the real property or the principal balance of the related mortgage loan. For this reason, the Managing Member may choose not to foreclose on contaminated property rather than risk incurring liability for remedial actions.

Under the laws of certain states, an owner's failure to perform remedial actions required under environmental laws may give rise to a lien on mortgaged property to ensure the reimbursement of remedial costs. In some states this lien has priority over the lien of an existing mortgage against the real property. Because the costs of remedial action could be substantial, the value of a mortgaged property as collateral for a mortgage loan could be adversely affected by the existence of an environmental condition giving rise to a lien.

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The state of law is currently unclear as to whether and under what circumstances clean-up costs, or the obligation to take remedial actions, can be imposed on a secured lender. If a lender does become liable for cleanup costs, it may bring an action for contribution against the current owners or operators, the owners or operators at the time of on-site disposal activity or any other party who contributed to the environmental hazard, but these persons or entities may be bankrupt or otherwise judgment-proof. Furthermore, an action against the borrower may be adversely affected by the limitations on recourse in the loan documents.

Our incentive to fund as many loans as possible may result in additional losses.

Substantially all of the Company's revenues are derived from interest generated through making or purchasing Loans. As a result, it has an incentive to finance as many Loans as possible to maximize the amount of fees and income is able to generate. Increased project volume increases the demands on its management resources and its ability to devote adequate attention and resources to the collection of corresponding Loans. In the event that the Company takes on loan volumes that exceed its ability to service outstanding corresponding Loans, our ability to make timely distributions will suffer.

The collateral for the Loans may decline in value.

The value of the real property security for each Loan and each Real Asset will be subject to the risks generally incident to the ownership of improved and unimproved real estate, including changes in general or local economic conditions, increases in interest rates for real estate financing, physical damage that is not covered by insurance, zoning, entitlements, and other risks. Many borrowers expect to use resale proceeds to repay their Loans. A decline in property values could result in a Loan amount being greater than the property value, which could increase the likelihood of borrower default, which could consequentially affect your returns.

Although real estate assets are generally cyclical in nature, the Company's operating history since its inception does not yet span any prolonged down cycles in the real estate market.

Loans ending with large "balloon" payments carry particular risks which may affect your returns.

Most of the Loans will be interest-only loans providing for small or no monthly payments with a large "balloon" payment of principal due at the end of the term. Borrowers may be unable to repay such balloon payments out of their own funds and will be compelled to refinance or sell their property. Fluctuations in real estate values, interest rates and the unavailability of mortgage funds could adversely affect the ability of borrowers to refinance their loans at maturity or successfully sell the property for enough money to pay off the corresponding Loan.

Construction and rehabilitation loans carry particular risks which may affect your returns.

Construction and rehabilitation loans involve a number of particular risks, involving, among other things, the timeliness of the project's completion, the integrity of appraisal values, whether or not the completed property can be sold for the amount anticipated, and the length of ultimate sale process.

If construction work is not completed (due to contractor abandonment, unsatisfactory work performance, or various other factors) and all the Loan funds have already been expended, then in the event of a default the Company may have to invest significant additional funds to complete the construction work. Any such investment would be recuperated by the Company prior to the Investor being paid back. If the value an uncompleted property is materially less than the amount of the construction loan, even if the work were completed, then upon a default the Company might need to invest additional funds in order to recoup all or a portion of the investment. Default risks also exist where it takes a borrower longer than anticipated either to construct or then resell the property, or if the borrower does not receive sufficient proceeds from the sale to repay the corresponding Loan in full.

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There are risks associated with foreclosure that could affect returns

Different property types involve different types of risk in terms of realizing on the collateral in the event that the borrower defaults. These risks include completion costs in the case of an incomplete project, partial resale for condominiums and tracts and lease-up (finding tenants) for multi-family residential, small commercial and industrial properties. The Company may not be able to sell a foreclosed commercial property, for example, before expending efforts to find tenants to make the property more fully leased and more attractive to potential buyers.

Moreover, foreclosure statutes vary widely from state to state. Properties underlying defaulted loans will need to before foreclosed upon in compliance with the laws of the state where such property is located. Many states require lengthy processing periods or the obtaining of a court decree before a mortgaged property may be sold or otherwise foreclosed upon. Further, statutory rights to redemption and the effects of anti-deficiency and other laws may limit the ability for the Company to timely recover the value of its loan in the event that a borrower defaults on a loan.

Borrower's bankruptcies may affect the Company's ability to collect on loans which could affect your returns.

If the borrower enters bankruptcy, an automatic stay of all proceedings against the borrower's property will be granted. This stay will prevent the Company from foreclosing on the property unless relief from the stay can be obtained from the bankruptcy court, and there is no guarantee that any such relief will be obtained. Significant legal fees and costs may be incurred in attempting to obtain relief from a bankruptcy stay from the bankruptcy court and, even if such relief is ultimately granted, it may take several months or more to obtain. In such event, the Company will be unable to promptly exercise its foreclosure remedy and realize any proceeds from a property sale.

In addition, bankruptcy courts have broad powers to permit a sale of the real property free of the Company's lien, to compel the Company to accept an amount less than the balance due under the loan and to permit the borrower to repay the loan over a term which may be substantially longer than the original term of the loan.

Defaults and foreclosures will affect your returns.

The Company will participate in Loans and take the risk that borrowers will default on those loans and other risks that lenders typically face, many of which are detailed in this Offering. Loans may be made to borrowers who do not qualify for loans from more traditional sources of financing, such as banks and savings and loans associations. Loans may generally provide for a "balloon" payment at the loan's maturity. Many borrowers may be unable to pay such a balloon payment and are compelled to refinance the balloon amount into a new loan. Fluctuations in the interest rates, unavailability of mortgage funds, and a decrease in the value of the real property securing the loan could adversely affect the borrower's ability to refinance their loans at maturity.

The Company will generally look to the underlying property securing the loan to determine whether to make the loan to the borrower and, to a lesser extent, the credit rating a borrower has. Nonetheless, borrowers may need to demonstrate adequate ability to meet its financial obligations under the terms of any loan which the Company originates or purchases.

To determine the fair market value of the property securing the loan, the Company will primarily rely on an appraisal, Managing Member's opinion of value of the property, broker's price opinions (BPOs), competitive market analysis (CMAs) or other similar opinion. Appraisals are a judgment of an individual appraiser's interpretation of a property's value. Due to the differences in individual opinions, values may vary from one appraiser to another.Furthermore, the appraisal is merely the value of the real property at the time the loan is originated. Market fluctuations and other conditions could cause the value of real property to decline over time.

If the borrower defaults on the loan, the Company may be forced to purchase the property at a foreclosure sale. If the Company cannot quickly sell the real property and the property does not produce significant income, the Company's profitability will be adversely affected.

Due to certain provisions of state law that may be applicable to all real estate loans, if real property security proves insufficient to repay amounts owing to the Company, it is unlikely that the Company will be able to recover any deficiency from the borrower.

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Finally, the recovery of sums advanced by the Company in making or investing in mortgage loans and protecting its security may also be delayed or impaired by the operation of the federal bankruptcy laws or by irregularities in the manner in which the loan was made. Any borrower has the ability to delay a foreclosure sale for a period ranging from several months to several years by filing a petition in bankruptcy which automatically stays any actions to enforce the terms of the loan. It can be assumed that such delays and the costs associated therewith will reduce the Company's profitability.

There are risks associated with the use of leverage.

The Company does not intend to use leverage or borrow funds from a third party lender to make or acquire Loans.  However, the Managing Member may, in its sole discretion, employ leverage as part of its strategy in the future . These loans would be secured by the Loans held by the Company. In order to obtain such a loan, the Company may assign part or its entire asset portfolio to the lender. Such borrowed money may bear interest at a variable rate, whereas the Company may be making fixed rate loans. Therefore, if prevailing interest rates rise, the Company's cost of money could exceed the income earned from that money, thus reducing the Company's profitability or causing losses. As secured debt, these loans will have a priority security interest in the assets of the Company, and, in the event of a liquidation, the holders of such debt would have a priority interest in such assets and would be entitled to a liquidation preference. In an event of default by the Company, the Members could lose part or all of their interest in the assets of the Company and the value of their underlying investment. Furthermore, leveraging the Company may also result in the receipt of some taxable income by investors (such as ERISA plans) that are otherwise tax-exempt. (See"Income Taxation Considerations")

Loan investments may be concentrated in the California real estate market.

The Company shall invest in loans in various geographic locations within the United States, but the Managing Member has offices in California, and therefore might have loans concentrated in California. The Company may be dependent upon the continued demand for housing and residential property in that state. The Company's revenue and the value of its property portfolio may be disproportionately affected if California's economy and real estate markets suffer greater adverse impacts than the economies and real estate markets in other states or nationally due to local industry slowdowns and layoffs, changing demographics and other factors that result in oversupply of, or reduced demand for, commercial or residential properties in the region.

Underestimates and cost overruns by borrowers may affect a borrower's ability to repay a Loan which may affect your returns.

Some of the Loans will be extended to real estate developers and investors, who, in turn will be using funds for the purposes of rehabbing properties or new construction. If a contractor hired by the borrower underestimates the material and labor costs, the property could suffer from cost overruns which could adversely affect our investment. Projects may require more time than anticipated, leading to increased costs which could also adversely affect your investment. In addition, some borrowers may not pay us back until their individual properties are either cash flow positive, refinanced, or sold. Therefore, if there are cost overruns or multiple unforeseen change orders, the Company may not receive its repayments on its loans in a timely manner which could adversely affect your investments.Cost overruns can reduce the profitability of a project, or cause the project to lose money.

Liability and other risks associated with ownership of real property could affect your returns.

When the Company acquires any real property by foreclosure or otherwise, the Company is exposed to the risks of liability incident to real property ownership or tenancy. Owners of real property may be subject to liability for injury to persons and property occurring on the real property or in connection with the activity conducted thereon, as well as liability for failure to comply with governmental regulations.

Fluctuations in interest rates may present other investment opportunities.

Mortgage interest rates are subject to abrupt and substantial fluctuations and the purchase of Class A Units are a relatively illiquid investment. If prevailing interest rates rise above the average interest rate being earned by the Company's portfolio, you may wish to liquidate your investment to take advantage of higher available returns but may be unable to do so due to restrictions on transfer and withdrawal.

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The Company is subject to litigation risks which may affect the overall profitability of the Company.

The Managing Member will act in good faith and use reasonable judgment in selecting borrowers and making, purchasing, and managing the mortgage loans and investing in, purchasing and managing properties. However, as a lender, the Managing Member and the Company are exposed to the risk of litigation by a borrower for any warranted or unwarranted allegations by a borrower regarding the terms of the loans or the actions or representations of the Managing Member in making, managing or foreclosing on subject properties. It is impossible to foresee the allegations borrowers will bring against the Managing Member or the Company, but the Managing Member will use its best efforts to avoid litigation if, in the Managing Member's sole discretion, it is in the best interests of the Company. If the Company is required to incur legal fees and costs to respond to the lawsuit, the costs and fees could have an adverse impact on the Company's profitability.

The Company's Participation in Loans with other lenders which the Company does not control creates additional risks.

The Company expects to participate in loans with other lenders. When participating in loans with other lenders, the Company, the Investment Manager or its Managing Member may not have control over the determination of when and how to enforce a default, depending on the terms of any participation agreement with the other lenders, other lenders may have varied amounts of input into such decision-making process, including the ultimate decision-making power on if and when to enforce a default. If the Company participates with a lender affiliated with the Managing Member or its principals, it is possible that the Company would not be the lead lender, although the principal of the Managing Member who is affiliated with the other lender may be the decision-making party. There is no certainty who will be a lead lender in a situation where the Company participates in ownership of a Loan with another entity.

Risks Related to Compliance and Regulation

We are offering our Class A Units pursuant to recent amendments to Regulation A promulgated pursuant to the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and we cannot be certain if the reduced disclosure requirements applicable to Tier 2 issuers will make our Class A Units less attractive to investors as compared to a traditional initial public offering.

As a Tier 2 issuer, we will be subject to scaled disclosure and reporting requirements, which may make our Class A Units less attractive to investors as compared to a traditional initial public offering, which may make an investment in our Class A Units less attractive to investors who are accustomed to enhanced disclosure and more frequent financial reporting. In addition, given the relative lack of regulatory precedence regarding the recent amendments to Regulation A, there is a significant amount of regulatory uncertainty in regards to how the SEC or the individual state securities regulators will regulate both the offer and sale of our securities, as well as any ongoing compliance that we may be subject to. If our scaled disclosure and reporting requirements, or regulatory uncertainty regarding Regulation A, reduces the attractiveness of our Class A Units, we may be unable to raise the necessary funds necessary to commence operations, or to develop a diversified portfolio of real estate investments, which could severely affect the value of our Class A Units.

Our use of Form 1-A and our reliance on Regulation A for this offering may make it more difficult to raise capital as and when we need it, as compared to if we were conducting a traditional initial public offering on Form S-11.

Because of the exemptions from various reporting requirements provided to us under Regulation A and because we are only permitted to raise up to $50 million in any 12-month period under Regulation A (although we may raise capital in other ways), we may be less attractive to investors and it may be difficult for us to raise additional capital as and when we need it. Investors may be unable to compare our business with other companies in our industry if they believe that our financial accounting is not as transparent as other companies in our industry. If we are unable to raise additional capital as and when we need it, our financial condition and results of operations may be materially and adversely affected.

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There may be deficiencies with our internal controls that require improvements, and if we are unable to adequately evaluate internal controls, we may be subject to sanctions.

As a Tier 2 issuer, we will not need to provide a report on the effectiveness of our internal controls over financial reporting, and we will be exempt from the auditor attestation requirements concerning any such report so long as we are a Tier 2 issuer. We are in the process of evaluating whether our internal control procedures are effective and therefore there is a greater likelihood of undiscovered errors in our internal controls or reported financial statements as compared to issuers that have conducted such evaluations.

Non-compliance with laws and regulations may impair our ability to arrange, service or otherwise manage our loans and other assets.

Failure to comply with the laws and regulatory requirements applicable to our business may, among other things, limit our, or a collection agency's, ability to collect all or part of the payments on our investments. In addition, our non-compliance could subject us to damages, revocation of required licenses or other authorities, class action lawsuits, administrative enforcement actions, and civil and criminal liability, which may harm our business.

Some states, including California, require nonfinancial companies, such as the Company, to obtain a real estate lending or other license in order to make commercial loans on a regular basis. Good Steward Account Servicing, Inc. has a California Finance Lenders Law License with California's Department of Business Oversight that satisfies the requirements in California and the Company anticipates working with Good Steward Account Servicing for the origination of such loans. The Company does not intend to finance loans in states where such licenses are required until it obtains the required license. The Company may, in the future, affiliate itself with third parties such as financial institutions in order to be able to arrange loans in jurisdictions where it might otherwise be restricted.

Maintenance of our Investment Company Act exemption imposes limits on our operations, which may adversely affect our operations.

We intend to continue to conduct our operations so that neither we nor any of our subsidiaries is required to register as an investment company under the Investment Company Act. We anticipate that we will hold real estate and real estate-related assets described below (i) directly, (ii) through wholly-owned subsidiaries, (iii) through majority-owned joint venture subsidiaries, and, (iv) to a lesser extent, through minority-owned joint venture subsidiaries.

We intend, directly or through our subsidiaries, to originate, invest in and manage a diversified portfolio of real estate investments. We expect to originate, acquire and structure real estate loans (including senior mortgage loans, subordinated mortgage loans, mezzanine loans, and participations in such loans) and to make other investments in real estate.

In connection with the Section 3(a)(1)(C) analysis, the determination of whether an entity is a majority-owned subsidiary of our company is made by us. The Investment Company Act defines a majority-owned subsidiary of a person as a company 50% or more of the outstanding voting securities of which are owned by such person, or by another company which is a majority-owned subsidiary of such person. The Investment Company Act further defines voting security as any security presently entitling the owner or holder thereof to vote for the election of directors of a company. We treat companies in which we own at least a majority of the outstanding voting securities as majority-owned subsidiaries. We also treat subsidiaries of which we or our wholly-owned or majority-owned subsidiary is the manager (in a manager-managed entity) or managing member (in a member-managed entity) or in which our agreement or the agreement of our wholly-owned or majority-owned subsidiary is required for all major decisions affecting the subsidiaries (referred to herein as "Controlled Subsidiaries"), as majority-owned subsidiaries even though none of the interests issued by such Controlled Subsidiaries meets the definition of voting securities under the Investment Company Act. We reached our conclusion on the basis that the interests issued by the Controlled Subsidiaries are the functional equivalent of voting securities. We have not asked the SEC staff for concurrence of our analysis, our treatment of such interests as voting securities, or whether the Controlled Subsidiaries, or any other of our subsidiaries, may be treated in the manner in which we intend, and it is possible that the SEC staff could disagree with any of our determinations. If the SEC staff were to disagree with our treatment of one or more companies as majority-owned subsidiaries, we would need to adjust our strategy and our assets. Any such adjustment in our strategy could have a material adverse effect on us.

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Certain of our subsidiaries may rely on the exclusion provided by Section 3(c)(5)(C) under the Investment Company Act. Section 3(c)(5)(C) of the Investment Company Act is designed for entities "primarily engaged in the business of purchasing or otherwise acquiring mortgages and other liens on and interests in real estate." This exclusion generally requires that at least 55% of the entity's assets on an unconsolidated basis consist of qualifying real estate assets and at least 80% of the entity's assets consist of qualifying real estate assets or real estate-related assets. These requirements limit the assets those subsidiaries can own and the timing of sales and purchases of those assets.

To classify the assets held by our subsidiaries as qualifying real estate assets or real estate-related assets, we will rely on no-action letters and other guidance published by the SEC staff regarding those kinds of assets, as well as upon our analyses (in consultation with outside counsel) of guidance published with respect to other types of assets. There can be no assurance that the laws and regulations governing the Investment Company Act status of companies similar to ours, or the guidance from the SEC or its staff regarding the treatment of assets as qualifying real estate assets or real estate-related assets, will not change in a manner that adversely affects our operations. In fact, in August 2011, the SEC published a concept release in which it asked for comments on this exclusion from regulation. To the extent that the SEC staff provides more specific guidance regarding any of the matters bearing upon our exemption from the need to register or exclusion under the Investment Company Act, we may be required to adjust our strategy accordingly. Any additional guidance from the SEC staff could further inhibit our ability to pursue the strategies that we have chosen.

Furthermore, although we intend to monitor the assets of our subsidiaries regularly, there can be no assurance that our subsidiaries will be able to maintain their exclusion from registration. Any of the foregoing could require us to adjust our strategy, which could limit our ability to make certain investments or require us to sell assets in a manner, at a price or at a time that we otherwise would not have chosen. This could negatively affect the value of our Class A Units, the sustainability of our business model and our ability to make distributions.

Registration under the Investment Company Act would require us to comply with a variety of substantive requirements that impose, among other things:

• limitations on capital structure;

• restrictions on specified investments;

• restrictions on leverage or senior securities;

• restrictions on unsecured borrowings;

• prohibitions on transactions with affiliates; and

• compliance with reporting, record keeping, voting, proxy disclosure and other rules and regulations that would significantly increase our operating expenses.

If we were required to register as an investment company but failed to do so, we could be prohibited from engaging in our business, and criminal and civil actions could be brought against us.

Registration with the SEC as an investment company would be costly, would subject us to a host of complex regulations and would divert attention from the conduct of our business, which could materially and adversely affect us. In addition, if we purchase or sell any real estate assets to avoid becoming an investment company under the Investment Company Act, our net asset value, the amount of funds available for investment and our ability to pay distributions to our members could be materially adversely affected.

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We are not subject to the banking regulations of any state or federal regulatory agency.

We are not subject to the periodic examinations to which commercial banks and other thrift institutions are subject. Consequently, our financing decisions and our decisions regarding establishing loan loss reserves are not subject to periodic review by any governmental agency. Moreover, we are not subject to regulatory oversight relating to our capital, asset quality, management or compliance with laws.

Recent legislative and regulatory initiatives have imposed restrictions and requirements on financial institutions that could have an adverse effect on our business.

The financial industry is becoming more highly regulated. There has been, and may continue to be, a related increase in regulatory investigations of the trading and other investment activities of alternative investment funds. Such investigations may impose additional expenses on us, may require the attention of senior management of our Managing Member and may result in fines if we are deemed to have violated any regulations.

Laws intended to prohibit money laundering may require the Company to disclose investor information to regulatory authorities.

The Uniting and Strengthening America By Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the "PATRIOT Act") requires that financial institutions establish and maintain compliance programs to guard against money laundering activities, and requires the Secretary of the U.S. Treasury ("Treasury") to prescribe regulations in connection with anti-money laundering policies of financial institutions. The Financial Crimes Enforcement Network ("FinCEN"), an agency of the Treasury, has recently announced that it is likely that such regulations would subject certain pooled investment vehicles to enact anti-money laundering policies. It is possible that there could be promulgated legislation or regulations that would require the Company or its service providers to share information with governmental authorities with respect to prospective investors in connection with the establishment of anti-money laundering procedures. Such legislation and/or regulations could require us to implement additional restrictions on the transfer of our Class A Units to comply with such legislation and/or regulations. We reserve the right to request such information as is necessary to verify the identity of prospective members and the source of the payment of subscription monies, or as is necessary to comply with any customer identification programs required by FinCEN and/or the SEC. In the event of delay or failure by a prospective member to produce any information required for verification purposes, an application for, or transfer of, our Class A Units may be refused. We will not have the ability to reject a transfer of our Class A Units where all necessary information is provided and any other applicable transfer requirements, including those imposed under the transfer provisions of our Operating Agreement, are satisfied.

Loans may be subject to a variety of onerous regulations which may affect our ability to conduct our business.

Although the Company does not anticipate offering Loans secured by owner occupied residential properties, those Loans secured by such properties may also be subject to certain provisions of the Truth-In-Lending Act and other applicable laws and rules concerning loans. These provisions impose additional disclosure and other requirements on creditors with respect to non-purchase money home equity loans secured by the borrower's principal dwelling with high interest rates or high up-front fees and charges where the loan funds are primarily used for personal, household or consumer purposes. In general, these home equity loans have annual percentage rates over eight percent (8%) greater than the yield on Treasury Securities of comparable maturity and/or fees and points which exceed the greater of six percent (6%) of the total loan amount. These provisions can impose specific statutory liabilities upon creditors who fail to comply with their provisions and may affect the enforceability of the related loans. In addition, any assignee of the creditor would generally be subject to all claims and defenses that the consumer could assert against the creditor, including, without limitation, the right to rescind the home equity loan. Furthermore, the State of California and certain cities in California have enacted or may enact certain statutes and ordinances designed to discourage so-called "predatory" lending practices by mortgage lenders, usually involving persuading a borrower to accept a larger loan than is needed at a higher interest rate and other costs than could reasonably be obtained from other sources.

These statutes and ordinances place an almost insurmountable burden of proof on the lender to justify its loan terms and lending practices, at the risk of rendering the loan unenforceable.

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Risks Related to Conflicts of Interest

There are conflicts of interest between us, our Managing Member and its Affiliates.

The executive officers of the Managing Member, including Thomas Braegelmann, Charles Tralka and Matthew Sullivan, are principals of other entities which provide loan origination, asset management, loan servicing and other services to the Company as well as other persons and entities. Mssrs. Braegelann, Tralka and Sullivan are the principals of SREIF Manager I, LLC, the managing member of the Secured Real Estate Income Fund I, LLC, a Delaware limited liability company ("SREIF I") which employs a loan origination, loan management and investment strategy which is similar to that employed by the Company. All of the agreements and arrangements between such parties, including those relating to compensation, are not the result of arm's length negotiations. Some of the conflicts inherent in the Company's transactions with the Managing Member and its Affiliates, and the limitations on such parties adopted to address these conflicts, are described below. The Company, Managing Member and their Affiliates will try to balance the interests of the Company with their own. However, to the extent that such parties take actions that are more favorable to other entities than us, these actions could have negative impact on our financial performance and, consequently, on distributions to members and the value of our Class A Units.

The Management Member and/or Affiliates may receive loan origination and renewal commissions and forbearance fees.

The Investment Manager and Managing Member and/or their Affiliates will have the sole and absolute discretion to determine whether or not to make, acquire or sell a particular Loan. None of the Managing Member's compensation set forth under "Managing Member's Compensation" was determined through arms-length negotiations. Any increase in such charges may have a direct, adverse effect upon the interest rates that borrowers will be willing to pay the Company, thus may reduce the overall rate of return to Members. Conversely, if the Company reduces the loan fees charged, a higher rate of return might be obtained for the Company and the Members. This conflict of interest will exist in connection with every transaction the Company participates in.

Company management not required to devote full-time to management of Company.

The Managing Member is not required to devote its capacities full-time to the Company's affairs, but only such time as the affairs of the Company may reasonably require.

The Managing Member, Investment Manager and their Affiliates and may compete with Affiliates of the Company

Though they currently have no intention to do so, there is no restriction preventing the Managing Member, the Investment Manager or any of their Affiliates, principals or management from competing with the Company by investing in collateral liens or sponsoring the formation of other investment groups like the Company to invest in similar areas. If the Managing Member or Investment Manager or any of their principals were to do so, then when considering each new investment opportunity, the Company, Managing Member, Investment Manager or such Affiliates or principals or would need to decide whether to originate or hold the resulting transaction in the Company, as an individual or in a competing entity. This situation would compel the Investment Manager or Managing Member to make decisions that may at times favor persons other than the Company. The Operating Agreement exonerates the Company and its Affiliates, principals and management from any liability for investment opportunities given to other persons.

The Company or Managing Member may originate and service Loans.

The Managing Member has reserved the right to engage the Investment Manager and other firms in addition to, or in lieu of, the Managing Member, to originate and select Loans or act as the loan servicer to perform the various origination and brokerage services, loan servicing and other activities in connection with the Company's investment portfolio that are described in this Offering Circular. Such other firms may or may not be affiliated with the Company or Managing Member. Firms not affiliated with the Company or Managing Member may provide comparable services on terms more favorable to the Company. The Managing Member has very wide discretion in determining which entity (including, but not limited to, the Managing Member itself, an Affiliate of the Managing Member, or an unaffiliated third party) will service the loans.

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The Managing Member and Investment Manager may engage in business with other companies, partnerships or businesses

The Managing Member, Investment Manager and their respective principals, directors, officers or Affiliates may engage, for their own account or for the account of others, in other business ventures similar to that of the Company, including, but not limited to SREIF I and GCA California Real Estate Fund, LLC, a California limited liability company ("CARE Fund") and others with an investment strategy which is similar to that of the Company, and neither the Company nor any member shall be entitled to any interest therein. As such, there exists a conflict of interest on the part of the principals, directors, officers and Affiliates of the Managing Member and the Investment Manager because there may be a financial incentive for the those persons to invest in, arrange or originate transactions for SREIF I, CARE Fund , private investors and other mortgage funds. Further, the Managing Member and its principals, directors, officers and Affiliates may be involved in creating additional mortgage or real estate funds that may compete with the Company or SREIF I. We expect that we will establish and sponsor additional investment vehicles in the future that will originate, acquire or invest in real estate loans, real estate and other real estate-related assets. SREIF and any additional investment vehicles may have investment criteria that compete with us. If a sale, financing, investment or other business opportunity would be suitable for more than one of these investment vehicles, the Investment Manager will allocate such opportunities between the Company, SREIF I, CARE Fund and such other entities using its business judgment. Any allocation of this type may involve the consideration of a number of factors that our Investment Manager determines to be relevant, including:

· the investment objectives and criteria of the Company, SREIF I, CARE Fund and the other investment vehicles;

· the cash position of the Company, SREIF I, CARE Fund and the other investment vehicles;

· the effect of the investment on the diversification the Company, SREIF I, CARE Fund or the other investment vehicle's portfolio by type of investment, and risk of investment;

· the anticipated cash flow of the asset to be acquired;

· the income tax effects of the purchase;

· the size of the investment; and

· the amount of funds available.

The Company will not have independent management and it will rely on the Managing Member, the Investment Manager and their respective managers, principals, directors, officers and/or affiliates for the operation of the Company. The Managing Member, Investment Manager and these individuals/entities will devote only so much time to the business of the Company as is reasonably required. The Managing Member, Investment Manager and their managers, principals, directors, officers and/or affiliates may have conflicts of interest in allocating management time, services and functions between various existing companies, and business ventures in they may be or become involved with. Each of the Managing Member and the Investment Manager believes it has sufficient staff to be fully capable of discharging its responsibilities.

The Company may purchase Loans from or sell Loans to Affiliates.

The Managing Member and its principals, directors, officers and/or affiliates may sell, buy or hypothecate loans (use loans as collateral for another loan) to or from the Company, provided that such loans meet the then-existing underwriting criteria of the Company. The Company may pay a price greater or less than the remaining balance on such loans. The price at which existing loans are bought and sold is normally a function of prevailing interest rates and the term of the loan. Therefore, the Managing Member and their principals, directors, officers and/or affiliates, may make a profit on the sale of a loan to the Company or from the purchase of an existing loan from the Company. There will be no independent review of the value of such loans or of compliance with the conditions set forth above.

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The Managing Member or its Affiliates may provide additional services.

The Managing Member or its Affiliates may provide other services to persons dealing with the Company or the loans. The Managing Member or its Affiliates are not prohibited from providing services to, and otherwise doing business with, the persons that deal with the Company.

The Managing Member or its Affiliates may receive project management fees.

The Managing Member or its Affiliates may receive project management fees or other compensation related to the administration and management of certain Company investments. In particular, the Managing Member or its Affiliates may receive payment for services related to construction loans and other Loans made by the Company which require administration as well as real estate projects in which the Company invests. These fees shall be at market rates and paid in good faith directly by the borrower or sponsor.

The Company may sell real estate assets to Affiliates.

In the event the Company becomes the owner of any real property by reason of foreclosure on a Loan, the Managing Member's first priority will be to arrange for the sale of the property for a price that will permit the Company to recover the full amount of its invested capital plus accrued but unpaid interest and other charges, or so much thereof as can reasonably be obtained in light of current market conditions. In order to facilitate such a sale the Managing Member may, but is not required to, arrange a sale to persons or entities controlled by it, (e.g. to another limited liability Company formed by the Managing Member for the express purpose of acquiring foreclosure properties from lenders such as the Company). The Managing Member will be subject to conflicts of interest in arranging such sales since it will represent both parties to the transaction. For example, the Company and the potential buyer will have conflicting interests in determining the purchase price and other terms and conditions of sale. The Managing Member's decision will not be subject to review by any outside parties. The Company may sell a foreclosed property to the Managing Member or an Affiliate at a price that is fair and reasonable for all parties, but no assurance can be given that the Company could not obtain a better price from an independent third party.

The Managing Member shall attempt to resolve these conflicts by setting a purchase price for each loan which is not less than any of the following: (i) the outstanding value (unpaid interest, points, and principal) of such loan, if any, at the time of sale; (ii) the amount of any third party offer already received, if any; or (iii) the total amount of the Company's investment in the loan. The Company's investment is deemed to include without limitation the following: the loan amount, expenditures made to protect the Company's interest in the loan, all costs associated with management, any sales commissions, and any advances made by or on behalf of the Company for any of the foregoing.

Risks Related to Our Organization and Structure

Our members do not elect or vote on our Managing Member and have limited ability to influence decisions regarding our business.

Our Operating Agreement provides that the assets, affairs and business of our company will be managed under the direction of our Managing Member.  Our members do not elect or vote on our Managing Member, and, unlike the holders of shares in a corporation, have only limited voting rights on matters affecting our business, and therefore limited ability to influence decisions regarding our business.

Our Class A Unit holders will have limited voting rights and may be bound by either a majority or supermajority vote.

Our Class A Unit holders will have voting rights only with respect to certain matters, primarily relating to amendments to our Operating Agreement that would adversely change the rights of the Class A Units and removal of our Managing Member for "cause".  Each outstanding Class A Unit entitles the holder to one vote on all matters submitted to a vote of Class A Unitholders.  Generally, matters to be voted on by our members must be approved by a majority of the votes cast by all Class A Units present in person or represented by proxy, although the vote to remove the Managing Member for "cause" requires a two-thirds vote.  If any vote occurs, you will be bound by the majority or supermajority vote, as applicable, even if you did not vote with the majority or supermajority.

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Certain provisions of our Operating Agreement and Delaware law could hinder, delay or prevent a change of control of our Company.

Certain provisions of our Operating Agreement and Delaware law could have the effect of discouraging, delaying or preventing transactions that involve an actual or threatened change of control of our company.  These provisions include the following:

· Authorization of additional Class A Units, issuances of authorized Class A Units and classification of Class A Units without member approval.  Our Operating Agreement authorizes us to issue additional Class A Units or other securities of our company for the consideration and on the terms and conditions established by our Managing Member without the approval of our members.  In particular, our Managing Member is authorized to provide for the issuance of an unlimited amount of one or more classes of our membership interests, including preferred membership interests, and to fix the number such membership interests, the relative powers, preferences and rights, and the qualifications, limitations or restrictions applicable to each class thereof by resolution authorizing the issuance of such class.  Our ability to issue additional membership interests and other securities could render more difficult or discourage an attempt to obtain control over our company by means of a tender offer, merger or otherwise.

· Exclusive authority of our Managing Member to amend our Operating Agreement.  Our Operating Agreement provides that our Managing Member has the exclusive power to adopt, alter or repeal any provision of the Operating Agreement, unless such amendment would (i) require a Member to pay any sum of money whatsoever in respect of such Member's interests in the Company, other than that which such Member has agreed to pay; (ii) materially reduce the increases and decreases of net assets of the Company or the amount of distributions of the Company to which such Member is entitled under this Agreement, without the consent of such Member; (iii) change the Management Fee, change the Preferred Return or otherwise modify the allocation of Net Income; or (iv) modify the limited liability of a Member, without the consent of such Member adversely change the rights of the Class A Units.  Thus, our members generally may not effect changes to our Operating Agreement.

The offering price of our Class A Units was not established on an independent basis; the actual value of your investment may be substantially less than what you pay. Until March 31 , 201 7 , we expect to use the price paid to acquire a share in our offering as the estimated value of our Class A Units. Thereafter, when determining the estimated value of our Class A Units, the value of our Class A Units will be based upon a number of assumptions that may not be accurate or complete.

We established the offering price of our Class A Units on an arbitrary basis. The selling price of our Class A Units bears no relationship to our book or asset values or to any other established criteria for valuing Class A Units. Because the offering price is not based upon any independent valuation, the offering price may not be indicative of the proceeds that you would receive upon liquidation. Further, the offering price may be significantly more than the price at which the Class A Units would trade if they were to be listed on an exchange or actively traded by broker-dealers.

After March 31, 201 7 and until our Class A Units are listed on a public exchange, our Managing Member will calculate our NAV per Class A Unit to determine our share price. Estimates are based on available information and judgment. Therefore, actual values and results could differ from our estimates and that difference could be significant. This approach to valuing our Class A Units may bear little relationship and will likely exceed what you might receive for your Class A Units if you tried to sell them or if we liquidated our portfolio.

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Your interest in us will be diluted if we issue additional Class A Units, which could reduce the overall value of your investment.

Potential investors in this offering do not have preemptive rights to any Class A Units we issue in the future. Under our Operating Agreement, we have authority to issue an unlimited number of additional Class A Units or other securities, although, under Regulation A, we are only allowed to sell up to $50 million of our Class A Units in any 12-month period (although we may raise capital in other ways). In particular, our Managing Member is authorized, subject to the restrictions of Regulation A and other applicable securities laws, to provide for the issuance of an unlimited amount of one or more classes units in our company, including preferred Class A Units, and to fix the number of Class A Units, the relative powers, preferences and rights, and the qualifications, limitations or restrictions applicable to each class thereof by resolution authorizing the issuance of such class, without member approval. After your purchase in this offering, our Managing Member may elect to (i) sell additional Class A Units in this or future public offerings, (ii) issue equity interests in private offerings, or (iii) issue Class A Units to our Managing Member, or its successors or assigns, in payment of an outstanding fee obligation. To the extent we issue additional equity interests after your purchase in this offering, your percentage ownership interest in us will be diluted. In addition, depending upon the terms and pricing of any additional offerings and the value of our investments, you may also experience dilution in the book value and fair value of your Class A Units.

Your interest in the Company may be diluted by the payment of distributions from proceeds from this offering.

Although our goal is to fund the payment of distributions solely from cash flow from operations, we may pay distributions from other sources, including the net proceeds of this offering. If we fund distributions from the net proceeds from this offering, you will experience immediate dilution to the extent that the Company's total capital contributions have increased but the assets of the Company have remained unchanged.

The Class A Units are subject to redemption by the Company.

The Managing Member may, in its sole discretion, compulsorily redeem up to ten percent (10%) of the outstanding Class A Units during any calendar year for the purpose of stabilizing NAV.    In addition, the Managing Member may elect to redeem all or a part of a member's Class A Units interests for any reason upon thirty (30) days written notice to the member at a price equal to the member's capital contribution plus any accrued but unpaid Preferred Return and other fees which are owed to the member on the date of redemption. The Managing Member may also, by notice to a member, force the sale of all or a portion of such member's interest on such terms as the Managing Member determines to be fair and reasonable, or take such other action as it determines to be fair and reasonable in the event that the Managing Member determines or has reason to believe that: (i) such member has attempted to effect a transfer of, or a transfer has occurred with respect to, any portion of such member's interest in violation of the Operating Agreement; (ii) continued ownership of such Class A Units by such Member is reasonably likely to cause the Company to be in violation of securities laws of the United States or any other relevant jurisdiction or the rules of any self-regulatory organization applicable to the Managing Member or its Affiliates; (iii) continued ownership of such interest by such member may be harmful or injurious to the business or reputation of the Company or the Managing Member, or may subject the Company or any members to a risk of adverse tax or other fiscal consequence, including without limitation, adverse consequence under ERISA; (iv) any of the representations or warranties made by such member in connection with the acquisition of such Member's interest was not true when made or has ceased to be true; or (v) such member's interest has vested in any other person by reason of the bankruptcy, dissolution, incompetency or death of such member.   Redemption of the Class A Interests may adversely affect investors or their investment portfolio.

By purchasing Class A Units in this offering, you are bound by the arbitration provisions contained in our subscription agreement which limits your ability to bring class action lawsuits or seek remedy on a class basis.

By purchasing Class A Units in this offering, investors agree to be bound by the arbitration provisions contained in Section 6 of our subscription agreement. Such arbitration provision applies to claims that may be made regarding this offering and, among other things, limits the ability of investors to bring class action lawsuits or similarly seek remedy on a class basis.

The subscription agreement allows for either us or an investor to elect to enter into binding arbitration in the event of any claim in which we and the investor are adverse parties, including claims regarding this offering. While not mandatory, in the event that we elected to invoke the arbitration clause, the rights of the adverse member to seek redress in court would be severely limited.

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Further, the subscription agreement restricts the ability of individual investors to bring class action lawsuits or to similarly seek remedy on a class basis, unless otherwise consented to by us. These restrictions on the ability to bring a class action lawsuit is likely to result in increased costs, both in terms of time and money, to individual investors who wish to pursue claims against us.

Our classification as a publicly traded partnership not taxable as a corporation is not free from doubt and could be challenged.

We operate as a partnership for federal income tax purposes. This allows us to pass through our income and deductions to our members. The listing of our Class A Units on a national securities exchange will cause us to be treated as a "publicly traded partnership" for federal income tax purposes. We, and our tax counsel, Durham Jones & Pinegar, PC ("Tax Counsel"), believe that we have been and are properly treated as a partnership for federal income tax purposes. However, the Internal Revenue Service ("IRS") could challenge our partnership status and we could fail to qualify as a partnership in future years. Qualification as a partnership involves the application of highly technical and complex Code provisions. For example, a publicly traded partnership is generally taxable as a corporation unless 90% or more of its gross income is "qualifying" income (which includes interest, dividends, real property rents, gains from the sale or other disposition of real property, gain from the sale or other disposition of capital assets held for the production of interest or dividends, and certain other items). We have represented that we anticipate that at least 90% of our gross income will be qualifying income and we intend to conduct our operations in a manner such that at least 90% of our gross income will constitute qualifying income in the future. Subject to the discussion below entitled "U.S. Federal Income Tax Considerations," in the opinion of Tax Counsel, although the issue is not free from doubt, we have been and are properly treated as a partnership for federal income tax purposes.

In determining whether interest is treated as qualifying income under these rules, interest income derived from a "financial business" and income and gains derived by a "dealer" in securities are not treated as qualifying income. We have represented that we are acting as an investor with respect to our investments and that we have not engaged in, and will not engage in, a financial business. There is no clear guidance on what constitutes a financial business. We have taken the position that for purposes of determining whether we are in a financial business, our bond acquisition and financing activities as well as our proposed activities would not cause us to be engaged in a financial business or to be considered a "dealer" in securities. The IRS could assert that our activities constitute a financial business. Even if we were considered to be engaged in a financial business, we believe that we would satisfy the requirement that 90% or more of our income constitutes qualifying income. If our activities constitute (or as a result of increased volume constitute) a financial business or cause us to be treated as a dealer, there is a substantial risk that more than 10% of our gross income would not constitute qualifying income. We could also be treated as if we were engaged in a financial business if the activities of our Managing Member were attributed to us. Although we are affiliated with our Managing Member, we seek to enter into arms-length arrangements with our Managing Member, have not authorized our Managing Member to act as our agent and our Managing Member will be subject to income tax with respect to amounts earned by it. Accordingly, we believe the activities of our Managing Member will not be attributed to us.

In addition, in determining whether interest is treated as qualifying income, interest income that is determined based upon the income or profits of any person is not treated as qualifying income. We anticipate that a portion of the interest payable on the Company may be generated in connection with Shared Appreciation Mortgage or "SAM". It is unclear whether or not income received from shared appreciation mortgages is "qualifying" income. Accordingly, if we were to receive more than 10% of our interest income in any given year from such shared appreciation mortgages or other contingent interest the IRS could take the position that we should be treated as a publicly traded partnership, taxable as an association. We plan to carefully monitor the type of interest income we receive to avoid such a circumstance. However, there can be no assurance that such monitoring will be effective in all events to avoid the receipt of more than 10% contingent interest in any given year, because circumstances outside of our control could cause such a result.

If for any reason less than 90% of our gross income constitutes "qualifying" income, items of income and deduction would not pass through to our members and our members would be treated for federal income tax purposes as stockholders in a corporation. We would be required to pay income tax at regular corporate rates on any portion of our net income that did not constitute tax-exempt income. In addition, a portion of our federally tax-exempt income may be included in determining our alternative minimum tax liability. Distributions by us to our members would constitute ordinary dividend income taxable to such holders to the extent of our earnings and profits, which would include tax-exempt income, as well as any taxable income we might have, and the payment of these distributions would not be deductible by us. These consequences would have a material adverse effect on us and our members.

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Risks Related to Employee Benefit Plans and Individual Retirement Accounts

In some cases, if you fail to meet the fiduciary and other standards under ERISA, the Code or common law as a result of an investment in our Class A Units, you could be subject to liability for losses as well as civil penalties.

There are special considerations that apply to investing in our Class A Units on behalf of pension, profit sharing or 401(k) plans, health or welfare plans, individual retirement accounts or Keogh plans. If you are investing the assets of any of the entities identified in the prior sentence in our Class A Units, you should satisfy yourself that:

· your investment is consistent with your fiduciary obligations under applicable law, including common law, ERISA and the Code;

· your investment is made in accordance with the documents and instruments governing the trust, plan or IRA, including a plan's investment policy;

· your investment satisfies the prudence and diversification requirements of Sections 404(a)(1)(B) and 404(a)(1)(C) of ERISA, if applicable, and other applicable provisions of ERISA and the Code;

· your investment will not impair the liquidity of the trust, plan or IRA;

· your investment will not produce "unrelated business taxable income" for the plan or IRA;

· you will be able to value the assets of the plan annually in accordance with ERISA requirements and applicable provisions of the applicable trust, plan or IRA document; and

· your investment will not constitute a prohibited transaction under Section 406 of ERISA or Section 4975 of the Code.

Failure to satisfy the fiduciary standards of conduct and other applicable requirements of ERISA, the Code, or other applicable statutory or common law may result in the imposition of civil penalties, and can subject the fiduciary to liability for any resulting losses as well as equitable remedies. In addition, if an investment in our Class A Units constitutes a prohibited transaction under the Code, the "disqualified person" that engaged in the transaction may be subject to the imposition of excise taxes with respect to the amount invested.

STATEMENTS REGARDING FORWARD-LOOKING INFORMATION

We make statements in this offering circular that are forward-looking statements within the meaning of the federal securities laws. The words "believe," "estimate," "expect," "anticipate," "intend," "plan," "seek," "may," and similar expressions or statements regarding future periods are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any predictions of future results, performance or achievements that we express or imply in this offering circular or in the information incorporated by reference into this offering circular.

The forward-looking statements included in this offering circular are based upon our current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. Factors which could have a material adverse effect on our operations and future prospects include, but are not limited to:

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• our ability to effectively deploy the proceeds raised in this offering;

• our ability to attract and retain investors;

• changes in economic conditions generally and the real estate and securities markets specifically;

• expected rates of return provided to investors;

• the ability of our sponsor and its affiliates to source, originate and service our loans and other assets, and the quality and performance of these assets;

• our ability to retain and hire competent employees and appropriately staff our operations;

• legislative or regulatory changes impacting our business or our assets (including changes to the laws governing taxation and SEC guidance related to Regulation A or the JOBS Act);

• changes in business conditions and the market value of our assets, including changes in interest rates, prepayment risk, operator or borrower defaults or bankruptcy, and generally the increased risk of loss if our investments fail to perform as expected;

• our ability to implement effective conflicts of interest policies and procedures among the various real estate investment opportunities sponsored by our sponsor;

• our ability to access sources of liquidity when we have the need to fund redemptions of Class A Units in excess of the proceeds from the sales of our Class A Units in our continuous offering and the consequential risk that we may not have the resources to satisfy redemption requests;

• our compliance with applicable local, state and federal laws, including the Investment Advisers Act of 1940, as amended (the "Advisers Act"), the Investment Company Act and other laws; and

• changes to generally accepted accounting principles, or GAAP.

Any of the assumptions underlying forward-looking statements could be inaccurate. You are cautioned not to place undue reliance on any forward-looking statements included in this offering circular. All forward-looking statements are made as of the date of this offering circular and the risk that actual results will differ materially from the expectations expressed in this offering circular will increase with the passage of time. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements after the date of this offering circular, whether as a result of new information, future events, changed circumstances or any other reason. In light of the significant uncertainties inherent in the forward-looking statements included in this offering circular, including, without limitation, the risks described under "Risk Factors," the inclusion of such forward-looking statements should not be regarded as a representation by us or any other person that the objectives and plans set forth in this offering circular will be achieved.

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DETERMINATION OF OFFERING PRICE

The Offering price for the Class A Units has been arbitrarily determined by the Managing Member and may not bear any relationship to assets to be acquired or the book value of the Company or any other established criteria or quantifiable indicia for valuing a business. Neither the Company nor the Managing Member represents that the Class A Units have or will have a market value equal to their offering price or could be resold (if at all) at their original offering price or at any price at all.

ESTIMATED USE OF PROCEEDS

The table below sets forth our estimated use of proceeds from this offering, assuming we sell in this offering: (i) $500,000 in Class A Units, the amount we need to start operations, and (ii) $50,000,000 in Class A Units, the maximum offering amount. Our Class A Units will be offered at $10.00 per Class A Unit until March 31, 2017. Thereafter, our price per Class A Unit will be adjusted every fiscal quarter and will be based on our NAV as of the end of the prior fiscal quarter until such time as our Class A Units are listed on a public exchange.

We expect to use substantially all of the net proceeds from this offering (after paying or reimbursing organization and offering expenses) to invest in and manage a diversified portfolio of real estate loans, real estate and other real estate-related assets and the repayment of bridge loans used to acquire assets, including loans from Affiliates. We expect that any expenses or fees payable to our Managing Member and Investment Manager for their services in connection with managing our daily affairs, including but not limited to, the selection and acquisition or origination of our investments, will be paid from cash flow from operations. If such fees and expenses are not paid from cash flow (or waived) they will reduce the cash available for investment and distribution and will directly impact our NAV. See "Management Compensation" for more details regarding the fees that will be paid to our Managing Member and its affiliates. Many of the amounts set forth in the table below represent our Managing Member's best estimate since they cannot be precisely calculated at this time.

We may not be able to promptly invest the net proceeds of this offering in real estate loans, investments in real estate and other real estate-related assets. In the interim, we may invest in short-term, highly liquid or other authorized investments. Such short-term investments will not earn as high of a return as we expect to earn on our real estate-related investments.

	Minimum Dollar Amount (1)	Offering Amount %	Maximum Offering Amount	Offering Amount %
Gross Proceeds	$500,000.00	100%	$50,000,000.00	100%
Estimated Offering Expenses (2)(3)	$150,000.00	30%	$150,000.00	0.3%
Selling Commissions and Fees (4)	$35,000.00	7%	$3,500,000.00	7%
Non-Accountable Expense Allowance (5)	$7,500.00	1.5%	$750,000.00	1.5%
Platform Fee (6)	$2,500.00	0.5%	$250,000.00	0.5%
Net Proceeds	$305,000.00	61%	$45,350,000.00	90.7%
Estimated Amount Available for Investment	$305,000.00	61%	$45,350,000.00	90.7%
Total Use of Proceeds	$500,000.00	100%	$50,000,000.00	100%

¹ This is a "best efforts" offering. We will not start operations or draw down on investors' funds and admit investors as members until we have raised at least $500,000 in this offering. Until the minimum threshold is met, investors' funds will be revocable and will be held in an escrow account or in a subscriber's account at Folio Investments, Inc for those investing through Folio Investments, Inc, or by the Provident Trust, as escrow agent for all others. If we do not raise $500,000 within 12 months, we will cancel the offering and release all funds from escrow or the subscriber's account at Folio Investments, Inc to the investors.

²Amount reflected is an estimate and may be more or less than the estimate. Includes all expenses to be paid by us to third parties in connection with the formation of the company and the qualification of the offering, and the marketing and distribution of Class A Units, including, without limitation, expenses for printing, engraving and amending offering statements or supplementing offering circulars, mailing and distributing costs, telephones, internet and other telecommunications costs, all advertising and marketing expenses, charges of experts and fees, expenses and taxes related to the filing, registration and qualification of the sale of Class A Units under federal and state laws, including taxes and fees and accountants' and attorneys' fees. See "Plan of Distribution."   None of the foregoing items shall be paid to or received by any underwriter or related person.

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³ After we have raised $500,000 in this offering and have begun our operations, we will reimburse our Managing Member for organization and offering costs, which are expected to be approximately $150,000. To date the Managing Member has incurred approximately $105,000 .  Please see "Management Compensation" for a description of additional fees and expenses that we will pay our Managing Member.  None of the foregoing items shall be paid to or received by any underwriter or related person.

⁴ Placement agents, including Cambria Capital, may receive selling commissions of up to seven percent (7%) of the gross offering proceeds.

⁵ Placement agents, including Cambria Capital, may receive a non-accountable expense allowance for due diligence, marketing and expense reimbursement of up to 1.5% of the gross proceeds of this offering.

⁶ FOLIO Investments, LLC may receive "platform fee" in the amount of 0.50% of the gross proceeds from this offering for fees for its clearing and facilitation services.

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PLAN OF OPERATION

General

We are a newly organized Delaware limited liability company formed for the purpose of investing in a diversified portfolio of real estate loans and other debt instruments collateralized by first and second position security interests in residential and real estate in the U.S. and the underlying real estate collateral. We intend to acquire senior and subordinate mortgage bridge and other real estate loans, and to invest in real estate and real estate-related debt instruments primarily originated by our affiliates. In addition, we may acquire any real properties or real estate equity investments that in the opinion of our Managing Member, meets our investment objectives. We plan to diversify our portfolio by investment type, investment size and investment risk with the goal of attaining a portfolio of real estate assets that provide attractive and stable returns to our investors. We may make our investments through direct loan origination, the acquisition of individual loans or loan portfolios. As of the date of this offering circular, we have not commenced operations nor have we identified any investments in which there is a reasonable probability that we will invest.

SREIF Manager II, LLC is our Managing Member. As our Managing Member, it will manage our day-to-day operations and our portfolio of real estate loans, real estate and other real estate-related assets. Our Managing Member also has the authority to make decisions regarding the operations of the Company as set forth in our Operating Agreement. The Managing Member has delegated responsibility and authority for making investment decisions for the Company to Good Steward Capital Management, Inc., an Arizona Corporation, pursuant to an Investment Management Agreement dated July 1, 2016. The Investment Manager will provide investment management, advisory, asset management, marketing, investor relations and other administrative services on our behalf.

Competition

Our net income depends, in large part, on our ability to originate investments with attractive risk-adjusted yields. In originating these investments, we compete with other mortgage funds, banks, specialty finance companies, savings and loan associations, REITS, mortgage bankers, private money lenders, hedge funds, private funds, other lenders and other entities, as well as online lending platforms, many of which have greater financial resources and lower costs of capital available to them than we have. In addition, there are numerous mortgage funds with loan origination and asset acquisition objectives similar to ours, and others may be organized in the future, which may increase competition for the investments suitable for us. Competitive variables include market presence and penetration, relationship status, size of loans offered and underwriting standards. To the extent that a competitor is willing to risk larger amounts of capital in a particular transaction or to employ more liberal underwriting standards when evaluating potential loans than we are, our investment volume and profit margins for our investment portfolio could be impacted. Our competitors may also be willing to accept lower returns on their investments and may succeed in acquiring the assets that we have targeted. Although we believe that we are well positioned to compete effectively in each facet of our business, there is enormous competition in our market sector and there can be no assurance that we will compete effectively or that we will not encounter increased competition in the future that could limit our ability to conduct our business effectively.

Liquidity and Capital Resources

We are dependent upon the net proceeds from this offering to conduct our proposed operations. We will obtain the capital required to purchase and originate real estate-related investments and conduct our operations from the proceeds of this offering and any future offerings we may conduct and from any undistributed funds from our operations. As of the date of this offering circular, we not made any investment. For information regarding the anticipated use of proceeds from this offering, see "Estimated Use of Proceeds."

We will not commence operations unless we raise a minimum of $500,000 in gross offering proceeds. If we are unable to raise substantially more than $500,000 in gross offering proceeds, we will make fewer investments resulting in less diversification in terms of the type, number and size of investments we make and the value of an investment in us will fluctuate with the performance of the specific assets we acquire. Further, we will have certain fixed operating expenses, including certain expenses related to reporting obligations under Regulation A, regardless of whether we are able to raise substantial funds in this offering. Our inability to raise substantial funds would increase our fixed operating expenses as a percentage of gross income, reducing our net income and limiting our ability to make distributions.

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We currently have short term debt related to organizational expenses, but do not plan to employ leverage as part of our strategy . Our Managing Member may, in the future , modify our leverage policy in its discretion in light of then-current economic conditions, relative costs of debt and equity capital, market values of our assets, general conditions in the market for debt and equity securities, growth and acquisition opportunities or other factors

In addition to making investments in accordance with our investment objectives, we expect to use our capital resources to make certain payments to our Managing Member. During our organization and offering stage, these payments will include payments for reimbursement of certain organization and offering expenses. During our acquisition and development stage, we expect to make payments to our Managing Member in connection with the selection and origination or purchase of investments, the management of our assets and costs incurred by our Managing Member in providing services to us. For a discussion of the compensation to be paid to our Managing Member, see "Management Compensation".

Warehousing of Assets

As an alternative means of acquiring loans or other investments for which we do not yet have sufficient funds, one or more affiliates of our Managing Member may close and fund each loan or other investment prior to it being acquired by us. This ability to warehouse investments allows us the flexibility to deploy our offering proceeds as funds are raised. We may then acquire such investment at a price equal to the fair market value of such investment, which will generally equal the cost of the investment (including reimbursements for servicing fees and accrued interest, if any), so there is no mark-up (or mark-down) at the time of our acquisition. 

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

Results of Operations

We were formed on June 15, 2016 and, as of the date of this offering circular, we have not commenced operations. We will not commence any significant investment operations until we have raised $500,000 from persons who are not affiliated with us or our Managing Member.

Market Outlook — Real Estate Finance Markets

FCI Lender Services, Inc, one of the largest non-bank originated loan servicers, recently estimated the US real estate private-lending industry generates approximately $65 billion in mortgages per annum⁷. Based on our research, we believe the private commercial real estate lending market will continue to have a promising outlook over the short and medium term, with lending to the residential and small commercial real estate sectors all projected to grow in the coming years.

According to the Urban Land Institute, the value of commercial real estate in the US is expected to grow 3.6% every year through 2018. The same report indicates that single-family housing starts are projected to increase from 714,600 units in 2015 to 900,000 units in 2018.⁸. In addition, the residential apartment market is expected to experience solid growth in the coming years, as housing construction increases and home values rise. According to Freddie Mac, the multifamily housing market will also "remain strong into the foreseeable future"⁹.According to the ULI, apartment rental rate growth is expected to grow in 2016 and '17 by 3.6% and 3.0%, respectively, and remain above the 20-year average growth rate of 2.8%.¹⁰ A recent report by CBRE indicates the senior housing market has a very strong long-term outlook¹¹, with demand increasingly steadily and reliably as the US population ages. Student housing is expected to grow in the near term¹², with the student population increasing to 23 million by 2020. Student housing sales have increased significantly in the last 10 years, and the student population has steadily increased over the last 20 years.

If markets continue to strengthen, the competition for risk-adjusted yield will become increasingly fierce. We believe we have a number of competitive advantages that will enable us to continue to deliver value to our investors in the face of increasing competition. These include:

· An experienced Investment Team that has worked together for more than a decade

· Extensive experience managing large real estate construction, development and rehabilitation projects through several real estate cycles

· Relationships developed over the investment team's decades of experience in the industry

· Proactive, experience-driven deal sourcing and underwriting processes

· Investment process underpinned by hands-on asset management

· Experience and flexibility to adapt and manage the Fund portfolio to meet the requirements of a changing Real Estate marketplace

Risks related to interest rate hikes and regulatory uncertainty could adversely affect growth and the values of our investments. In the event market fundamentals deteriorate, our real estate portfolio or the collateral security in any loan investment we make may be impaired. Further, these circumstances may materially impact the cost and availability of credit to borrowers, hampering the ability of our Managing Member to acquire new loans or investments with attractive risk-reward dynamics or the ability of our borrowers to refinance loans or sell their properties and pay off our loans.

⁷ Source: http://www.wsj.com/articles/private-lenders-remodel-the-mortgage-market-1462984898

⁸Source: Urban Land Institute http://uli.org/research/centers-initiatives/center-for-capital-markets/barometers-forecast-and-data/uli-real-estate-consensus-forecast/

⁹ Source: FreddieMac MultiFamily Outlook 2016 http://www.freddiemac.com/multifamily/pdf/freddieMac_mf_outlook_2016.pdf

¹⁰ Source: Urban Land Institute http://uli.org/wp-content/uploads/ULI-Documents/ULIREConsensusForecast_Spring2016.pdf

¹¹ Source: CBRE Investor Survey and Market Outlook February 2016 http://www.cbre.us/services/valuationadvisory/AssetLibrary/CBRE_SeniorsHousing_InvestorSurvey_H2_2015.pdf

¹² Source: CCIM http://www.ccim.com/cire-magazine/articles/323626/2014/09/student-housing-stats/?gmSsoPc=1

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Over the short term, we remain cautiously optimistic about the opportunity to acquire loans and investments offering attractive risk-adjusted returns in our targeted investment markets. However, we recognize disruptions in financial markets can occur at any time. By targeting short investment durations, we believe we will remain well positioned, as compared to our competitors, in the event current market dynamics deteriorate.

Investment Company Act Considerations  

We intend to conduct our operations so that neither we, nor any of our subsidiaries, are required to register as investment companies under the Investment Company Act of 1940, as amended (the "Investment Company Act").  Section 3(a)(1)(A) of the Investment Company Act defines an investment company as any issuer that is or holds itself out as being engaged primarily in the business of investing, reinvesting or trading in securities. Section 3(a)(1)(C) of the Investment Company Act defines an investment company as any issuer that is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire investment securities having a value exceeding 40% of the value of the issuer's total assets (exclusive of U.S. Government securities and cash items) on an unconsolidated basis, which we refer to as the 40% test. Excluded from the term "investment securities," among other things, are U.S. Government securities and securities issued by majority-owned subsidiaries that are not themselves investment companies and are not relying on the exception from the definition of investment company set forth in Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act.

We intend to conduct our operations so that they comply with the 40% test . We will monitor our holdings to ensure continuing and ongoing compliance with this test . In addition, we believe that we will not be considered an investment company under Section 3(a)(1)(A) of the Investment Company Act because we will not engage primarily or hold our selves out as being engaged primarily in the business of investing, reinvesting or trading in securities. Rather, we expect that most of our assets will be held through wholly owned or majority owned subsidiaries and that these subsidiaries will be primarily engaged in the non-investment company businesses.

We expect that most of these subsidiarieswill be outside the definition of investment company under Section 3(a)(1) of the Investment Company Act and will be able to rely upon the exclusion from the definition of "investment company" provided by Section 3(c)(5)(C) of the Investment Company Act. Section 3(c)(5)(C), as interpreted by the staff of the SEC, requires each entity relying on this exception to invest at least 55% of its portfolio in "mortgage and other liens on and interests in real estate," which we refer to as "qualifying real estate assets" and maintain at least 80% of its assets in qualifying real estate assets or other real estate-related assets.  The classification of our assets for purposes of the Investment Company Act will be based in large measure upon no-action letters issued by the SEC staff in the past and other SEC interpretive guidance.

In August, 2011, the SEC published a concept release entitled "Companies Engaged in the Business of Acquiring Mortgages and Mortgage Related Instruments" (Investment Company Act Rel. No. 29778). This release notes that the SEC is reviewing the Section 3(c)(5)(C) exclusion relied upon by companies similar to us that invest in mortgage loans. The Company is also relying upon the guidance provided by the relief granted in Inland Western Retail Real Estate Trust, Inc. (August 25, 2003), T REIT, Inc. (June 4, 2001) and Wells Real Estate investment Trust II, Inc. (December 9, 2003).  Pursuant to such guidance, the Redemption Program has the following requirements: (i) members of the Company must hold shares of common stock for at least fifteen months to participate in the Redemption Program; (ii) the Company will terminate its Redemption Program in the event a secondary market for its common stock develops; (iii) during the Offering, the Class A Units will be redeemed at a price that is fixed and less than the public offering price of the units in the Offering; thereafter, the redemption price will equal to the then current net asset value of the Class A Units; (iv) the number of Class A Units to be redeemed under the Redemption Program will not exceed, during any calendar year, 5% of the weighted average number of Class A Units outstanding during the prior calendar year; and (v) the terms of the Redemption Program are fully disclosed in this offering circular

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There can be no assurance that the laws and regulations governing the Investment Company Act status of companies similar to ours, or the guidance from the SEC or its staff regarding the treatment of assets as qualifying real estate assets or real estate-related assets, will not change in a manner that adversely affects our operations as a result of this review. To the extent that the SEC or its staff provides more specific guidance regarding any of the matters bearing upon our exclusion from the need to register under the Investment Company Act, we may be required to adjust our strategy accordingly. Any additional guidance from the SEC staff could provide additional flexibility to us, or it could further inhibit our ability to pursue the strategies that we have chosen.

In the event that we were to acquire assets that could make either entity fall within the definition of investment company under Section 3(a)(1) of the Investment Company Act, we believe that we would still qualify for an exclusion from registration pursuant to Section 3(c)(6). Section 3(c)(6) excludes from the definition of investment company any company primarily engaged, directly or through majority owned subsidiaries, in one or more of certain specified businesses. These specified businesses include the real estate business described in Section 3(c)(5)(C) of the Investment Company Act. It also excludes from the definition of investment company any company primarily engaged, directly or through majority owned subsidiaries, in one or more of such specified businesses from which at least 25% of such company's gross income during its last fiscal year is derived, together with any additional business or businesses other than investing, reinvesting, owning, holding, or trading in securities. Although the SEC staff has issued little interpretive guidance with respect to Section 3(c)(6), we believe that we may rely on Section 3(c)(6) if 55% of our assets consist of, and at least 55% of our income is derived from, qualifying real estate assets owned by our wholly owned or majority owned subsidiaries.

Qualification for exemption from registration under the Investment Company Act will limit our ability to make certain investments. To the extent that the SEC staff provides more specific guidance regarding any of the matters bearing upon such exclusions, we may be required to adjust our strategy accordingly. Any additional guidance from the SEC staff could provide additional flexibility to us, or it could further inhibit our ability to pursue the strategies we have chosen.

The loss of our exclusion from regulation pursuant to the Investment Company Act could require us to restructure our operations, sell certain of our assets or abstain from the purchase of certain assets, which could have an adverse effect on our financial condition and results of operations. See "Risk Factors—Risks related to Our Organizational Structure—Maintenance of our Investment Company Act exemption imposes limits on our operations, which may adversely affect our operations."

Critical Accounting Policies

Below is a discussion of the accounting policies that management believes will be critical once we commence operations. We consider these policies critical because we believe that understanding these policies is critical to understanding and evaluating our reported financial results. Additionally, these policies may involve significant management judgments and assumptions, or require estimates about matters that are inherently uncertain. These judgments will affect the reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our financial statements. Additionally, other companies may utilize different estimates that may impact the comparability of our results of operations to those of companies in similar businesses.

Valuation of Financial Instruments

Proper valuation of financial instruments is a critical component of our financial statement preparation. ASC 820 defines fair value, establishes a framework for measuring fair value, establishes a fair value hierarchy based on the quality of inputs used to measure fair value and enhances disclosure requirements for fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between marketplace participants at the measurement date (i.e., the exit price).

We will categorize our financial instruments, based on the priority of the inputs to the valuation technique, into a three level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

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Financial assets and liabilities recorded on the condensed consolidated balance sheets will be categorized based on the inputs to the valuation techniques as follows:

· Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market (examples include active exchange-traded equity securities, listed derivatives, most U.S. Government and agency securities, and certain other sovereign government obligations).

· Financial assets and liabilities whose values are based on the following:

o quoted prices for similar assets or liabilities in active markets (for example, restricted stock);

o quoted prices for identical or similar assets or liabilities in non-active markets (examples include corporate and municipal bonds, which trade infrequently);

o pricing models whose inputs are observable for substantially the full term of the asset or liability (examples include most over-the-counter derivatives, including interest rate and currency swaps); and

o pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the asset or liability (for example, certain mortgage loans).

· Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management's own assumptions about the assumptions a market participant would use in pricing the asset or liability (examples include private equity investments, commercial mortgage backed securities, and long-dated or complex derivatives including certain foreign exchange options and long dated options on gas and power).

The fair values of our financial instruments will be based on observable market prices when available. Such prices will be based on the last sales price on the date of determination, or, if no sales occurred on such day, at the "bid" price at the close of business on such day and if sold short at the "asked" price at the close of business on such day. Interest rate swap contracts will be valued based on market rates or prices obtained from recognized financial data service providers. Generally, these prices will be provided by a recognized financial data service provider.

Fair Value Option

ASC 825 "Fair Value Option for Financial Assets and Financial Liabilities" ("ASC 825") provides a fair value option election that allows companies to irrevocably elect fair value as the initial and subsequent measurement attribute for certain financial assets and liabilities. Changes in fair value for assets and liabilities for which the election is made will be recognized in earnings as they occur. ASC 825 permits the fair value option election on an instrument by instrument basis at initial recognition. We will determine the fair value of financial assets and financial liabilities for which the ASC 825 election is made pursuant to the guidance in ASC 820.

Available for Sale Securities

We will determine the appropriate classification of our investments in securities at the time of purchase and reevaluate such determination at each balance sheet date in accordance with ASC 320 "Accounting for Certain Investments in Debt and Equity Securities" ("ASC 320"). Securities for which we will not have the intent or the ability to hold to maturity will be classified as available for sale securities. We will determine the fair value of our available for sale securities pursuant to the guidance in ASC 820.

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Revenue Recognition

We will recognize interest income from our real estate debt investments on an accrual basis over the life of the investment using the effective interest method. We will recognize fees, discounts, premiums, anticipated exit fees and direct cost over the term of the loan as an adjustment to the yield. We will recognize fees on commitments that expire unused at expiration.

We will recognize interest income from available for sale securities on an accrual basis over the life of the investment on a yield-to-maturity basis.

Credit Losses, Impairment and Allowance for Doubtful Accounts

We will assess whether unrealized losses on the change in fair value on our available for sale securities reflect a decline in value which is other than temporary in accordance with EITF 03-1 "The Meaning of Other than Temporary Impairment and its Application to Certain Investments." If it is determined the decline in value is other than temporary, the impaired securities will be written down through earnings to their fair values. Significant judgment of management is required in this analysis, which includes, but is not limited to, making assumptions regarding the collectability of the principal and interest, net of related expenses, on the underlying loans.

We will establish allowances for real estate debt investment losses based upon a periodic review of the loan investments. Income recognition will generally be suspended for the investments at the earlier of the date at which payments become 90 days past due or when, in the opinion of management, a full recovery of income and principal becomes doubtful. Income recognition will be resumed when the suspended investment becomes contractually current and performance is demonstrated to be resumed. In performing this review, management will consider the estimated net recoverable value of the investment as well as other factors, including the fair market value of any collateral, the amount and the status of any senior debt, the prospects for the borrower and the economic situation of the region where the borrower does business. Because this determination will be based upon projections of future economic events, which are inherently subjective, the amounts ultimately realized from the investments may differ materially from the carrying value at the balance sheet date.

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GENERAL INFORMATION

Secured Real Estate Income Fund II, LLC, is a Delaware limited liability company organized on June 15, 2016 for the purposes of investing in a diversified portfolio of real estate loans and other debt instruments collateralized by first and second position security interests in residential and real estate in the U.S. and the underlying real estate collateral. We intend to acquire senior and subordinate mortgage bridge and other real estate loans, and to invest in real estate and real estate-related debt instruments primarily originated by our affiliates. In addition, we may acquire any real properties or real estate equity investments that in the opinion of our Managing Member, meets our investment objectives. The Company may also finance real estate projects using other funding methods, including (but not limited to) joint venture equity financing. We plan to diversify our portfolio by investment type, investment size and investment risk with the goal of attaining a portfolio of real estate assets that provide attractive and stable returns to our investors. We may make our investments through direct loan origination, the acquisition of individual loans or loan portfolios.

Our Operating Agreement provides that the Company will continue until the completion of the winding up of the business and affairs of the Company. The Operating Agreement does not provide for an annual or other regular meeting of the members.

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INVESTMENT OBJECTIVES AND STRATEGY

Investment Objectives

Our investment objectives are:

· to pay attractive and consistent cash distributions; and

· to preserve, protect and return your capital contribution.

We cannot assure you that we will attain these objectives or that the value of our assets will not decrease. Furthermore, within our investment objectives and policies, our Managing Member will have substantial discretion with respect to the selection of specific investments and the purchase and sale of our assets. Our Managing Member's investment committee will review our investment guidelines at least annually to determine whether our investment guidelines continue to be in the best interests of our members.

Investment Strategy

We intend to use substantially all of the proceeds of this offering to acquire, asset manage, syndicate and opportunistically sell investments in a variety of real estate loans, land development loans and other real estate secured loans. For its loan portfolio, the Company will secure Loans with first and/or second position security interests. The Company may also finance real estate projects using other funding methods, including (but not limited to) joint venture equity financing.

The Company 's loan products will be short-term Loans, which will be characterized with the following targeted parameters:

1. Twelve (12) to twenty-four (24) month note secured by first or second position deeds of trust, mortgage, security deed or similar instruments;

2. Borrowers may be required to pay interest-only payments and shall also pay loan origination fees or loan arrangement fees in the amount of two (2) or more points;

3. Loan amount can include acquisition, development, improvement, or new construction loans with the associated costs;

4. Subject to possible tax restrictions, some of the Loans may utilize Shared Appreciation Mortgages ("SAMs," also known as Contingent Interest Notes) in order to secure an equity position in the underlying collateral. For such financing the Company's targeted share of the return is 10% or greater of the appreciation in equity;

5. Loans will be extended to borrowers in relation to undervalued or distressed, non-owner occupied, single family or multi-family residences (including condos, townhomes and Planned Unit Developments), as well as for land development and new construction, and commercial properties (office, retail and other);

6. Loan amounts will usually be based on 70% or less of the As-Completed Value of the property excluding interest reserves. This figure may increase if sufficient additional collateral is provided by the borrower;

7. Short-term loans allow borrowers to purchase properties that may not qualify for financing through conventional mortgage lenders. Once the property is rehabilitated or developed, the borrower may sell the property wholesale or retail;

8.                 Loans will not be insured by the Federal Housing Administration or guaranteed by the Veterans Administration or otherwise guaranteed or insured;

9.                 Loans will be made throughout the United States, with a particular focus in the Western United States and California;

10. Exit fees may be payable to the Company by the borrower upon sale or resale of property and/or loans. All exit fees on loans in which the Company is the lender, co-lender, or fractional lender, shall be payable to the Company. In the event the Company is the co-lender or a participating or fractionalized lender, the Company shall receive its pro-rata share of the exit fee based on its time and ownership percentage of the loans;

11. Once sufficiently capitalized ($1,000,000 in invested capital), the Company will seek to invest no more than ten percent (10%) of its assets in any single loan.

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The Company will also make, purchase, and otherwise acquire Loans that have the option to acquire property for longer term investment.

The following discussion contains summaries, which are general in nature, of certain legal aspects of loans secured by single family residential properties. Because such legal aspects are governed primarily by the applicable laws of the state in which the related mortgaged property is located (which laws may differ substantially), the summaries do not purport to be complete nor to reflect the laws of any particular state, nor to encompass the laws of all states in which the properties are situated. The summaries are qualified in their entirety by reference to the applicable federal and state laws governing the Loans.

General

All of the Loans are evidenced by a promissory note secured by instruments granting a security interest in real property which may be mortgages, deeds of trust, security deeds or deeds to secure debt, depending upon the prevailing practice and law in the state in which the mortgaged property is located. Mortgages, deeds of trust and deeds to secure debt are in this offering circular collectively referred to as "mortgages." Any of the foregoing types of mortgages will create a lien upon, or grant a title interest in, the subject property, the priority of which will depend on the terms of the particular security instrument, as well as separate, recorded, contractual arrangements with others holding interests in the mortgaged property, the knowledge of the parties to such instrument as well as the order of recordation of the instrument in the appropriate public recording office. However, recording does not generally establish priority over governmental claims for real estate taxes and assessments and other charges imposed under governmental police powers.

Types of Mortgage Instruments

A mortgage either creates a lien against or constitutes a conveyance of real property between two parties – a mortgagor, who is usually the owner of the subject property (or, in the case of a Loan secured by a property that has been conveyed to an inter-vivos revocable trust, the settlor of such trust) – and a mortgagee. In a mortgage instrument state, the mortgagor delivers to the mortgagee a note or bond evidencing the mortgage loan and the mortgage. In contrast, a deed of trust is a three party instrument, among a trustor (the equivalent of a mortgagor), a trustee to whom the mortgaged property is conveyed, and a beneficiary (the mortgagee) for whose benefit the conveyance is made. As used in this offering circular, unless the context otherwise requires, "mortgagor" includes the trustor under a deed of trust and a grantor under a security deed or a deed to secure debt. Under a deed of trust, the mortgagor grants the property, irrevocably until the debt is paid, in trust, generally with a power of sale as security for the indebtedness evidenced by the related note. A deed to secure debt typically has two parties. By executing a deed to secure debt, the grantor conveys title to, as opposed to merely creating a lien upon, the subject property to the grantee until such time as the underlying debt is repaid, generally with a power of sale as security for the indebtedness evidenced by the related mortgage note. In case the mortgagor under a mortgage is a land trust, there would be an additional party because legal title to the property is held by a land trustee under a land trust agreement for the benefit of the mortgagor. The mortgagee's authority under a mortgage, the trustee's authority under a deed of trust and the grantee's authority under a deed to secure debt are governed by the express provisions of the mortgage, the law of the state in which the real property is located, certain federal laws (including, without limitation, the Relief Act) and, in some cases, in deed of trust transactions, the directions of the beneficiary.

Interest in Real Property

The real property covered by a mortgage, deed of trust, security deed or deed to secure debt is most often the fee estate in land and improvements. However, such an instrument may encumber other interests in real property such as a tenant's interest in a lease of land or improvements, or both, and the leasehold estate created by such lease. An instrument covering an interest in real property other than the fee estate requires special provisions in the instrument creating such interest or in the mortgage, deed of trust, security deed or deed to secure debt, to protect the mortgagee against termination of such interest before the mortgage, deed of trust, security deed or deed to secure debt is paid.

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Condominiums

Certain of the Loans may be loans secured by condominium units. The condominium building may be a multi-unit building or buildings, or a group of buildings whether or not attached to each other, located on property subject to condominium ownership. Condominium ownership is a form of ownership of real property as to which each owner is entitled to the exclusive ownership and possession of his or her individual condominium unit. The owner also owns a proportionate undivided interest in all parts of the condominium building (other than the other individual condominium units) and all areas or facilities, if any, for the common use of the condominium units. The condominium unit owners appoint or elect the condominium association to govern the affairs of the condominium.

Foreclosure

Foreclosure is a legal procedure that allows the mortgagee to recover its mortgage debt by enforcing its rights and available legal remedies under the mortgage. If the mortgagor defaults in payment or performance of its obligations under the note or mortgage, the mortgagee has the right to institute foreclosure proceedings to sell the mortgaged property at public auction to satisfy the indebtedness. Foreclosure procedures with respect to the enforcement of a mortgage vary from state to state. Two primary methods of foreclosing a mortgage are judicial foreclosure and non-judicial foreclosure pursuant to a power of sale granted in the mortgage instrument. There are several other foreclosure procedures available in some states that are either infrequently used or available only in certain limited circumstances, such as strict foreclosure.

A judicial foreclosure proceeding is conducted in a court having jurisdiction over the mortgaged property. Generally, the action is initiated by the service of legal pleadings upon all parties having an interest of record in the real property. Delays in completion of the foreclosure may occasionally result from difficulties in locating defendants. When the mortgagee's right to foreclose is contested, the legal proceedings can be time consuming. Upon successful completion of a judicial foreclosure proceeding, the court generally issues a judgment of foreclosure and appoints a referee or other officer to conduct a public sale of the mortgaged property, the proceeds of which are used to satisfy the judgment. Such sales are made in accordance with procedures that vary from state to state.

United States courts have traditionally imposed general equitable principles to limit the remedies available to a mortgagee in connection with foreclosure; particularly where the mortgagee is occupying the property securing the Loan. These equitable principles are generally designed to relieve the mortgagor from the legal effect of mortgage defaults, to the extent that such effect is perceived as harsh or unfair. Relying on such principles, a court may alter the specific terms of a loan to the extent it considers necessary to prevent or remedy an injustice, undue oppression or overreaching, or may require the mortgagee to undertake affirmative and expensive actions to determine the cause of the mortgagor's default and the likelihood that the mortgagor will be able to reinstate the loan. In some cases, courts have substituted their judgment for the mortgagee's and have required that mortgagees reinstate loans or recast payment schedules in order to accommodate mortgagors who are suffering from a temporary financial disability. In other cases, courts have limited the right of the mortgagee to foreclose if the default under the mortgage is not monetary, e.g., the mortgagor failed to maintain the mortgaged property adequately or the mortgagor executed a junior mortgage on the mortgaged property. The exercise by the court of its equity powers will depend on the individual circumstances of each case presented to it. Finally, some courts have been faced with the issue of whether federal or state constitutional provisions reflecting due process concerns for adequate notice require that a mortgagor receive notice in addition to statutorily prescribed minimum notice. For the most part, these cases have upheld the reasonableness of the notice provisions or have found that a public sale under a mortgage providing for a power of sale does not involve sufficient state action to afford constitutional protections to the mortgagor.

Foreclosure of a deed of trust is generally accomplished by a non-judicial trustee's sale pursuant to the power of sale granted in the deed of trust. A power of sale is typically granted in a deed of trust. It may also be contained in any other type of mortgage instrument. A power of sale allows a non-judicial public sale to be conducted generally following a request from the beneficiary/mortgagee to the trustee to sell the property upon any default by the mortgagor under the terms of the mortgage note or the mortgage instrument and after notice of sale is given in accordance with the terms of the mortgage instrument, as well as applicable state law. In some states, prior to such sale, the trustee under a deed of trust must record a notice of default and notice of sale and send a copy to the mortgagor and to any other party who has recorded a request for a copy of a notice of default and notice of sale. In addition, in some states the trustee must provide notice to any other party having an interest of record in the real property, including junior lienholders. A notice of sale must be posted in a public place and, in most states, published for a specified period of time in one or more newspapers. The mortgagor or junior lienholder may then have the right, during a reinstatement period required in some states, to cure the default by paying the entire actual amount in arrears (without acceleration) plus the expenses incurred in enforcing the obligation. In other states, the mortgagor or the junior lienholder is not provided a period to reinstate the loan, but has only the right to pay off the entire debt to prevent the foreclosure sale. Generally, the procedure for public sale, the parties entitled to notice, the method of giving notice and the applicable time periods are governed by state law and vary among the states. Foreclosure of a deed to secure debt is also generally accomplished by a non-judicial sale similar to that required by a deed of trust, except that the mortgagee or its agent, rather than a trustee, is typically empowered to perform the sale in accordance with the terms of the deed to secure debt and applicable law.

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A third party may be unwilling to purchase a mortgaged property at a public sale because of the difficulty in determining the value of such property at the time of sale, due to, among other things, redemption rights which may exist and the possibility of physical deterioration of the property during the foreclosure proceedings. For these reasons, it is common for the mortgagee to purchase the mortgaged property for an amount equal to or less than the underlying debt and accrued and unpaid interest plus the expenses of foreclosure. Generally, state law controls the amount of foreclosure costs and expenses which may be recovered by a mortgagee. Thereafter, subject to the mortgagor's right in some states to remain in possession during a redemption period, if applicable, the mortgagee will become the owner of the property and have both the benefits and burdens of ownership of the mortgaged property. For example, the mortgagee will become obligated to pay taxes, obtain casualty insurance and to make such repairs at its own expense as are necessary to render the property suitable for sale. The mortgagee will commonly obtain the services of a real estate broker and pay the broker's commission in connection with the sale of the property. Depending upon market conditions, the ultimate proceeds of the sale of the property may not equal the mortgagee's investment in the property. Moreover, a mortgagee commonly incurs substantial legal fees and court costs in acquiring a mortgaged property through contested foreclosure and/or bankruptcy proceedings. Generally, state law controls the amount of foreclosure expenses and costs, including attorneys' fees that may be recovered by a mortgagee.

A junior mortgagee may not foreclose on the property securing the junior mortgage unless it forecloses subject to senior mortgages and any other prior liens, in which case it may be obliged to make payments on the senior mortgages to avoid their foreclosure. In addition, in the event that the foreclosure of a junior mortgage triggers the enforcement of a "due on sale" clause contained in a senior mortgage, the junior mortgagee may be required to pay the full amount of the senior mortgage to avoid its foreclosure.

The proceeds received by the referee or trustee from the sale are applied first to the costs, fees and expenses of sale and then in satisfaction of the indebtedness secured by the mortgage under which the sale was conducted. Any proceeds remaining after satisfaction of senior mortgage debt are generally payable to the holders of junior mortgages and other liens and claims in order of their priority, whether or not the mortgagor is in default. Any additional proceeds are generally payable to the mortgagor. The payment of the proceeds to the holders of junior mortgages may occur in the foreclosure action of the senior mortgage or a subsequent ancillary proceeding or may require the institution of separate legal proceedings by such holders.

The purposes of a foreclosure action are to enable the mortgagee to realize upon its security and to bar the mortgagor, and all persons who have an interest in the property which is subordinate to the mortgage being foreclosed, from exercise of their "equity of redemption." The doctrine of equity of redemption provides that, until the property covered by a mortgage has been sold in accordance with a properly conducted foreclosure and foreclosure sale, those having an interest which is subordinate to that of the foreclosing mortgagee have an equity of redemption and may redeem the property by paying the entire debt with interest. In addition, in some states, when a foreclosure action has been commenced, the redeeming party must pay certain costs of such action. Those having an equity of redemption must generally be made parties and joined in the foreclosure proceeding in order for their equity of redemption to be cut off and terminated.

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The equity of redemption is a common law (non-statutory) right which exists prior to completion of the foreclosure, is not waivable by the mortgagor, must be exercised prior to foreclosure sale and should be distinguished from the post-sale statutory rights of redemption. In some states, after sale pursuant to a deed of trust or foreclosure of a mortgage, the mortgagor and foreclosed junior lienors are given a statutory period in which to redeem the property from the foreclosure sale. In some states, statutory redemption may occur only upon payment of the foreclosure sale price. In other states, redemption may be authorized if the former mortgagor pays only a portion of the sums due. The effect of a statutory right of redemption is to diminish the ability of the mortgagee to sell the foreclosed property. The exercise of a right of redemption would defeat the title of any purchaser from a foreclosure sale or sale under a deed of trust. Consequently, the practical effect of the redemption right is to force the mortgagee to maintain the property and pay the expenses of ownership until the redemption period has expired. In some states, a post-sale statutory right of redemption may exist following a judicial foreclosure, but not following a trustee's sale under a deed of trust.

Anti-Deficiency Legislation, the Bankruptcy Code and Other Limitations on Mortgagees

Statutes in some states limit the right of a beneficiary under a deed of trust or a mortgagee under a mortgage to obtain a deficiency judgment against the mortgagor following foreclosure or sale under a deed of trust. A deficiency judgment would be a personal judgment against the former mortgagor equal to the difference between the net amount realized upon the public sale of the real property and the amount due to the mortgagee. Some states require the mortgagee to exhaust the security afforded under a mortgage by foreclosure in an attempt to satisfy the full debt before bringing a personal action against the mortgagor. In certain other states, the mortgagee has the option of bringing a personal action against the mortgagor on the debt without first exhausting such security; however, in some of these states, the mortgagee, following judgment on such personal action, may be deemed to have elected a remedy and may be precluded from exercising remedies with respect to the security. In some cases, a mortgagee will be precluded from exercising any additional rights under the note or mortgage if it has taken any prior enforcement action. Consequently, the practical effect of the election requirement, in those states permitting such election, is that mortgagees will usually proceed against the security first rather than bringing a personal action against the mortgagor. Finally, other statutory provisions limit any deficiency judgment against the former mortgagor following a judicial sale to the excess of the outstanding debt over the fair market value of the property at the time of the public sale. The purpose of these statutes is generally to prevent a mortgagee from obtaining a large deficiency judgment against the former mortgagor as a result of low or no bids at the judicial sale.

In addition to laws limiting or prohibiting deficiency judgments, numerous other federal and state statutory provisions, including the federal bankruptcy laws and state laws affording relief to debtors, may interfere with or affect the ability of the secured mortgage mortgagee to realize upon collateral or enforce a deficiency judgment. For example, under the Bankruptcy Code, virtually all actions (including foreclosure actions and deficiency judgment proceedings) are automatically stayed upon the filing of a bankruptcy petition, and, usually, no interest or principal payments are made during the course of the bankruptcy case. Foreclosure of an interest in real property of a debtor in a case under the Bankruptcy Code can typically occur only if the bankruptcy court vacates the stay, an action, the court may be reluctant to take, particularly if the debtor has the prospect of restructuring his or her debts and the mortgage collateral is not deteriorating in value. The delay and the consequences of such delay caused by such automatic stay can be significant. Also, under the Bankruptcy Code, the filing of a petition in bankruptcy by or on behalf of a junior lienor (a subordinate mortgagee secured by a mortgage on the property) may stay a senior mortgagee from taking action to foreclose.

A homeowner may file for relief under the Bankruptcy Code under any of three different chapters of the Bankruptcy Code. Under Chapter 7, the assets of the debtor are liquidated and a mortgagee secured by a lien may "bid in" (i.e., bid up to the amount of the debt) at the sale of the asset. See "—Foreclosure" above. A homeowner may also file for relief under Chapter 11 of the Bankruptcy Code and reorganize his or her debts through his or her reorganization plan. Alternatively, a homeowner may file for relief under Chapter 13 of the Bankruptcy Code and address his or her debts in a rehabilitation plan. (Chapter 13 is often referred to as the "wage earner chapter" or "consumer chapter" because most individuals seeking to restructure their debts file for relief under Chapter 13 rather than Chapter 11).

The Bankruptcy Code permits a mortgage loan that is secured by property that does not consist solely of the debtor's principal residence to be modified without the consent of the mortgagee provided certain substantive and procedural safeguards are met. Under the Bankruptcy Code, the mortgagee's security interest may be reduced to the then current value of the property as determined by the court if the value is less than the amount due on the loan, thereby leaving the mortgagee as a general unsecured creditor for the difference between the value of the collateral and the outstanding balance of the mortgage loan. A mortgagor's unsecured indebtedness will typically be discharged in full upon payment of a substantially reduced amount. Other modifications to a mortgage loan may include a reduction in the amount of each monthly payment, which reduction may result from a reduction in the rate of interest, an alteration of the repayment schedule, an extension of the final maturity date, and/or a reduction in the outstanding balance of the secured portion of the loan. In certain circumstances, subject to the court's approval, a debtor in a case under Chapter 11 of the Bankruptcy Code may have the power to grant liens senior to the lien of a mortgage.

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A reorganization plan under Chapter 11 and a rehabilitation plan under Chapter 13 of the Bankruptcy Code may each allow a debtor to cure a default with respect to a mortgage loan on such debtor's residence by paying arrearages over a period of time and to decelerate and reinstate the original mortgage loan payment schedule, even though the mortgagee accelerated the loan and a final judgment of foreclosure had been entered in state court (provided no sale of the property had yet occurred) prior to the filing of the debtor's petition under the Bankruptcy Code. Under a Chapter 13 plan, curing of defaults must be accomplished within the five-year maximum term permitted for repayment plans, such term commencing when repayment plan becomes effective, while defaults may be cured over a longer period of time under a Chapter 11 plan of reorganization.

Generally, a repayment plan in a case under Chapter 13 and a plan of reorganization under Chapter 11 may not modify the claim of a mortgagee if the mortgagor elects to retain the property, the property is the mortgagor's principal residence and the property is the mortgagee's only collateral. Certain courts have allowed modifications when the mortgage loan is secured both by the debtor's principal residence and by collateral that is not "inextricably bound" to the real property, such as appliances, machinery, or furniture.

The general protection for mortgages secured only by the debtor's principal residence is not applicable in a case under Chapter 13 if the last payment on the original payment schedule is due before the final date for payment under the debtor's Chapter 13 plan (which date could be up to five years after the debtor emerges from bankruptcy). Under several recently decided cases, the terms of such a loan can be modified in the manner described above. While these decisions are contrary to the holding in a prior case by a senior appellate court, it is possible that the later decisions will become the accepted interpretation in view of the language of the applicable statutory provision. If this interpretation is adopted by a court considering the treatment in a Chapter 13 repayment plan of a Loan, it is possible that the Loan could be modified.

State statutes and general principles of equity may also provide a mortgagor with means to halt a foreclosure proceeding or sale and to force a restructuring of a mortgage loan on terms a mortgagee would not otherwise accept.

In a bankruptcy or similar proceeding of a mortgagor, action may be taken seeking the recovery, as a preferential transfer or on other grounds, of any payments made by the mortgagor under the related mortgage loan prior to the bankruptcy or similar proceeding. Payments on long term debt may be protected from recovery as preferences if they are payments in the ordinary course of business made on debts incurred in the ordinary course of business or if the value of the collateral exceeds the debt at the time of payment. Whether any particular payment would be protected depends upon the facts specific to a particular transaction.

A trustee in bankruptcy, in some cases, may be entitled to collect its costs and expenses in preserving or selling the mortgaged property ahead of a payment to the mortgagee. Moreover, the laws of certain states also give priority to certain tax and mechanics liens over the lien of a mortgage. Under the Bankruptcy Code, if the court finds that actions of the mortgagee have been unreasonable and inequitable, the lien of the related mortgage may be subordinated to the claims of unsecured creditors. The Code provides priority to certain tax liens over the lien of the mortgage

If a borrower defaults, the Company may foreclose on the property corresponding to the Loan. The terms of Loans with respect to default and foreclosure will vary. Loan documents may provide, for example, that a default by the borrower on any other loan or obligation made or arranged by the Company will cause the Company (or lead lender) to declare a default under the deed of trust relating to the Loan. The Company may add a shortfall from the borrower on one loan to the payoff demand on another loan from the same borrower; in such a case, the Company would direct the shortfall amount back to the first loan.

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The Company may also determine that an advance is necessary and prudent to protect Investors' interests. Such instances might include the cancelation or expiration of insurance, the delinquency of property taxes, removal of mechanic's liens, additional expenses necessary to complete construction, expenses to market the property, or any other expenses that Company deems necessary. Any such advances would be added to the Loan amounts, bear interest at the loan rate, and, in the case of forced insurance, may be significantly more expensive than conventional fire insurance.

Most Loans either provide for monthly payments of interest only or do not require any payments and only require the borrower to make a "balloon" payment of the unpaid principal and interest at the end of the loan term. Some Loans may be partially amortized loans, and will require the borrower to make a "balloon" payment of the unpaid principal and interest at the end of the loan term. The Company does not currently expect to make or arrange loans that contain provisions for negative amortization.

From time to time, the Company will rewrite loans requiring "balloon" payments that the Company has previously made to a borrower. With respect to such rewritten loans, the Company will apply the same underwriting guidelines and may not obtain a new appraisal of the property.

Construction, Rehabilitation, Home Improvement and Entitlement Loans.

Some Loans may relate to construction loans for various types of properties, including single family residential, condominiums, multi-family residential, apartment complexes, student housing, industrial, all varying kinds of commercial (including but not limited to shopping center, office, multiuse, storage), foreclosed (REO), unimproved land with entitlements, small tract properties, and other kinds of varying real estate transactions. The loan underwriting for construction, rehabilitation and unimproved land with entitlement loans is typically based upon a determined ARV "as completed" value, i.e., the projected value of the property after the completion of the construction or rehabilitation of a property. Special builder's risk insurance, or "course of construction" insurance, may be required by the Company in these cases.

Although construction Loans will be fully funded at the closing of the Loans, the proceeds of a construction loan may be disbursed by the Company or a designated servicer either directly to the borrower or to a construction or builder's fund control Company (which may be affiliated with the Company) as agent for the Members. The borrowers will typically be required to enter into a construction loan agreement that governs the release of the loan proceeds in a number of draws. Disbursements would be made by the Company, its authorized agent, or the construction or builder's fund control Company only as portions of the construction work are completed, and only upon instructions from the Company or its agent after monitoring such progress, with the amount of disbursement based upon a percentage of work completed. The laws of some states compel only one disbursement of funds, or prohibit collection of monthly interest in funds not yet disbursed. Disbursements may include interest on the construction loan and advance payments to the Investors of up to three months' interest or more. The amount of the disbursement to pay the contractor and the subcontractors generally would be based upon a percentage of completion of construction. In its discretion, the Company may require the retention of a percentage of the amounts paid to the contractor or subcontractors. Disbursements may be made directly to the borrower or contractors or subcontractors or jointly to the borrower and to the contractors or the subcontractors or jointly to the contractors and subcontractors.

For rehabilitation Loans, a portion of the Loan proceeds will typically be disbursed directly to the borrower or to a construction or builder's fund control Company, and the borrower would enter into a loan disbursement agreement that will govern the release of the portion of the loan proceeds that are intended to be used for repairs and rehabilitation. The borrower will generally be required to commence work promptly, and the Company will generally limit the initial amount released to the borrower to one-half of the total amount of the retained proceeds, although this figure can vary. In most cases, Company will require the borrower to have already completed certain line items within the scope of work before they will be entitled to receive any money. Construction or rehabilitation disbursements will be made by the Company, its servicing agent, or the construction or builder's fund control Company based on the disbursement schedule and fund control authorization. The laws of some states compel only one disbursement of funds, or prohibit collection of monthly interest in funds not yet disbursed. If the improvements have not been completed within the time period set forth in the construction or rehabilitation agreement, or if the Company were to determine that the balance of the loan proceeds was not sufficient to complete the construction, then the Company or its loan servicer may use any remaining retained funds to complete the construction or may require the borrower to deposit additional funds with the Company or the construction or builder's fund control Company.

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Interest on this type of Loan or Loan Interest will accrue as set forth in the applicable Note. Upon any default pursuant to a Loan or Loan Interest, the Company or its loan servicer may apply all or any portion of the amount in the Company's trust account or held by the construction or builder's fund control Company to amounts due under the Loan.

For some projects, the Company will require the borrower to obtain builder's risk insurance, which is also known as course of construction insurance. This specialized insurance is intended to insure structures while they are under construction. Materials, fixtures and appliances that are intended to become an integral part of the structure being built are also insured. The insurance is provided for loss resulting from accidental direct physical damage to the structure under construction. The policies generally include broad coverage, but exclude earthquake, flood and damage caused by earth movement. Some builder's risk policies limit coverage to physical damage caused by specifically named perils, such as fire and theft. These perils would be specifically listed in the policy.

Special Considerations in Connection with Junior Encumbrances

In addition to the general considerations concerning trust deeds discussed above, there are certain additional considerations applicable to second and more junior deeds of trust ("junior encumbrances"). By its very nature, a junior encumbrance is less secure than a more senior lien. If a senior lien holder forecloses on its loan, unless the amount of the bid exceeds the senior encumbrances, the junior lien holder will receive nothing. Because of the limited notice and attention given to foreclosure sales, it is possible for a junior lien holder to be sold out, receiving nothing from the foreclosure sale, although all legal methods of recouping the LP's investment will be exhausted. By virtue of anti-deficiency legislation, discussed above, a junior lien holder may be totally precluded from any further remedies.

Accordingly, a junior lien holder may find that the only method of protecting its security interest in the property is to take over all obligations of the trustor with respect to senior encumbrances while the junior lien holder commences its own foreclosure, making adequate arrangements either to (1) find a purchaser for the property at a price which will recoup the junior lien holder's interest, or (2) to pay off the senior encumbrances so that the junior lien holder's encumbrance achieves first priority. Either alternative may require the LP to make substantial cash expenditures to protect its interest.

If the borrower defaults solely upon his, her or its debt to the Company while continuing to perform with regard to the senior lien, the Company (as junior lien holder) will foreclose upon its security interest in the manner discussed above in connection with deeds of trust generally. Upon foreclosure by a junior lien, the property remains subject to all liens senior to the foreclosed lien. Thus, if the Company were to purchase the security property at its own foreclosure sale, it would acquire the property subject to all senior encumbrances.

The standard form of deed of trust used by most institutional lenders, like the one that will be used by the Company or its Affiliates, confers on the beneficiary the right both to receive all proceeds collected under any hazard insurance policy and all awards made in connection with any condemnation proceedings, and to apply such proceeds and awards to any indebtedness secured by the deed of trust in such order as the beneficiary may determine. Thus, in the event improvements on the property are damaged or destroyed by fire or other casualty, or in the event the property is taken by condemnation, the beneficiary under the underlying first deed of trust will have the prior right to collect any insurance proceeds payable under a hazards insurance policy and any award of damages in connection with the condemnation, and to apply the same to the indebtedness secured by the first deed of trust before any such proceeds are applied to repay the loan in respect of the Company. The amount of such proceeds may be insufficient to pay the balance due to the Company, while the debtor may fail or refuse to make further payments on the damaged or condemned property, leaving the Company with no feasible means to obtain payment of the balance due under its junior deed of trust. In addition, the borrower may have a right to require the lender to allow the borrower to use the proceeds of such insurance for restoration of the insured property.

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The Company's forms of promissory notes and deeds of trust, like those of many lenders, contain "due-on-sale" clauses, which permits the Company to accelerate the maturity of a loan if the borrower sells, conveys or transfers all or any portion of the property, but may or may not contain "due-on-encumbrance" clauses which would permit the same action if the borrower further encumbers the property (i.e., executes further deeds of trust). The enforceability of these types of clauses has been the subject of several major court decisions and legislation in recent years.

Due-on-Sale: Federal law now provides that, notwithstanding any contrary pre-existing state law, due-on-sale clauses contained in mortgage loan documents are enforceable in accordance with their terms by any lender after October 15, 1985. On the other hand, acquisition of a property by the Company by foreclosure on one of its loans may also constitute a "sale" of the property, and would entitle a senior lien holder to accelerate its loan against the Company. This would be likely to occur if then prevailing interest rates were substantially higher than the rate provided for under the accelerated loan. In that event, the Company may be compelled to sell or refinance the property within a short period of time, notwithstanding that it may not be an opportune time to do so.

Due-on-Encumbrance: With respect to mortgage loans on residential property containing four or less units, federal law prohibits acceleration of the loan merely by reason of the further encumbering of the property (e.g., execution of a junior deed of trust). This prohibition does not apply to mortgage loans on other types of property. Although many of the Company's junior lien mortgages will be on properties that qualify for the protection afforded by federal law, some loans will be secured by properties that do not qualify for the protection, including (without limitation) small apartment buildings or commercial properties. Junior lien mortgage loans made by the Company may trigger acceleration of senior loans on properties if the senior loans contain valid due-on-encumbrance clauses, although both the number of such instances and the actual likelihood of acceleration are anticipated to be minor. Failure of a borrower to pay off the senior loan would be an event of default and subject the Company (as junior lien holder) to the risks attendant thereto. It will not be customary practice of the Company to make loans on non-residential property where the senior encumbrance contains a due-on-encumbrance clause.

Bankruptcy Laws

If a borrower files for protection under the federal bankruptcy statutes, the Company will be initially barred from taking any foreclosure action on its real property security by an "automatic stay order" that goes into effect upon the borrower's filing of a bankruptcy petition. Thereafter, the Company would be required to incur the time, delay and expense of filing a motion with the bankruptcy court for permission to foreclose on the real property security ("relief from the automatic stay order"). Such permission is granted only in limited circumstances. If permission is denied, the Company will likely be unable to foreclose on its security for the duration of the bankruptcy, which could be a period of years. During such delay, the borrower may or may not be required to pay current interest on the Company loan. The Company would therefore lack the cash flow it anticipated from the loan, and the total indebtedness secured by the security property would increase by the amount of the defaulted payments, perhaps reaching a total that would exceed the market value of the property.

In addition, bankruptcy courts have broad powers to permit a sale of the real property free of the Company's lien, to compel the Company to accept an amount less than the balance due under the loan and to permit the borrower to repay the loan over a term which may be substantially longer than the original term of the loan.

Prepayment Charges

Loans may provide for certain prepayment charges to be imposed on the borrowers in the event of certain early payments on the loan. The Managing Member reserves the right, but has no obligation, at its business judgment to waive collection of prepayment penalties. Applicable federal and state laws may limit the prepayment charge on residential loans. For commercial or multi-family loans there is no federal law that limits the prepayment amount charge, but applicable state laws may vary.

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Market Conditions and the Investment Opportunity

While the real estate market has recovered significantly, lending terms from banks have remained more restrictive than they were before the "Great Recession". The Managing Member believes this creates an opportunity for the Company to lend money for projects with relatively short-term appreciation potential. That appreciation can come from rehabbing a distressed property, creating a new property through construction, or developing land into ready-to-build lots. The Managing Member will seek opportunities with borrowers who present such projects and will invest in those projects which meet its criteria for security and return potential. We believe that our investment strategy combined with the experience and expertise of our Managing Member's management team will provide opportunities to originate investments with attractive current and accrued returns and strong structural features directly with real estate companies, thereby taking advantage of changing market conditions in order to seek the best risk-return dynamic for our members.

The Managing Member will retain the option to use Leverage (borrowing money to improve loan yields) as appropriate in the opinion of the Managing Member. The Managing Member will also retain the option of co-investing in projects, fractionally or in whole, in priority positions, and/or same positions and/or subordinate positions. Management may also co-invest with other individuals, companies, pools and/or funds to expand investment opportunities or to diversify the Company's loan and real estate portfolio.

Subject to possible tax restrictions, the Company may utilize Shared Appreciation Mortgage or "SAM" in connection with a portion of the Loans. The SAM component (also known in the industry as "Contingent Interest") enables the Managing Member to increase the effective yield of loans in those cases where the borrower is able resell their properties at a net profit. This approach allows the fund members and Managing Member to participate in the appreciation of the property while minimizing downside risk by avoiding having a direct equity position in the property.

The Managing Member believes this strategy to be an excellent fit for the current market conditions. However, the Managing Member will continue to evaluate the real estate market as a whole along with its investment strategies in order to pursue to opportunities which represent the best risk/reward profile in the Managing Member's opinion. As a result, the Managing Member's strategy could well change one or more times over the life of the fund.

The Managing Member sees the Company's strategy as appropriate at this time and has planned accordingly. If banks and conventional lending institutions make capital more readily available, borrowers may not be willing to share equity from their projects nor pay interest rates in excess of 10% and loan arrangement and origination fees. For these reasons, the Managing Member is prepared to change the Company's strategy as market conditions change, or to wind down the fund if the then-current market conditions so warrant.

Risk Mitigation

Please see "Risk Factors" for a complete discussion of the risks associated with the Company, its business, taxes, and the lending business.

The Company believes it may be able to mitigate some of the risks set forth in "Risk Factors" by implementing one or more of the following policies. The Company will use its sole and absolute discretion in determining which, if any, of the following policies will mitigate the Risk Factors set forth below. The Company is neither obligated nor required to implement any of the following policies, and also reserves the right to implement alternative risk mitigating policies.

Short term (twelve (12) to twenty-four (24) month) loan defaults are reduced by:

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1. Emphasizing thorough due diligence of the borrower during the underwriting process, requiring verification of the borrower's income, assets and credit. In a buy and hold lending scenario, these guidelines typically mirror conventional underwriting guidelines, and borrowers are pre-qualified for conventional take-out financing options if necessary. In a fix & flip or develop and sell scenario, though, more attention may be paid to the value of the asset itself if the borrower is experienced as a real estate investor and developer;

2. Implementing a "Cash Flow Valuation" policy as a part of the valuation process of the underlying asset for Buy and Hold loans which have regular rental income. In this model, a standard appraisal is obtained from a licensed third-party appraiser; however, the value of the asset is determined by its ability to maintain positive cash flow as an income property against its total debt obligation. This proprietary method of appraising collateral eliminates subjective opinion of value found in most appraisals and reduces loss from over-valuation;

3. Collecting interest payments for the basic loan term up front which are held in escrow in an Interest Reserve Account, which lowers the Company's exposure to the potential for non-payment of interest payments;

4. Requiring a twelve (12) to twenty-four (24) month balloon note thereby reducing the amount of time during which a borrower's personal financial situation and economic conditions can change;

5. An expectation to diversify risk over multiple loans.

6. The Company limits its Loan to Value Ratio to 70% LTV of after-completion value, (excluding any interest payments that are held in escrow in a loan interest reserves account) creating a 30% or higher equity "cushion" in its position. This LTV figure may increase if sufficient additional collateral is provided by the borrower. Even though declines in real estate values could decrease the Company's equity position in the short term, it would take upwards of a 30% decline in prices over a six to twelve-month period to experience a loss in principal due to declining market conditions.

7. Utilizing a builders control mechanism that answers directly to the Company's Managing Member to conduct on-site inspections of the subject collateral before and during the rehab to help prevent cost-overruns.¹³ During the underwriting process, the Managing Member's builders control – a licensed General Contracting firm– walks the property with the borrower's contractor to verify the existing bid for accuracy in scope of work, material and labor costs. The budget is then divided into a multiple draws, the first of which must be at least 70% material costs. Following completion of each phase of construction, the builder's control returns to the job site to confirm the completion before the next draw is released.

8. Concentrating on specific submarkets where housing is at a premium or neighborhoods are attractive.

In addition, the Managing Member recognizes the need for complete transparency and accountability to its Investors, and plans to utilize third party bookkeeping and accounting firms to perform quarterly financial statements and year-end financial statements for the Company.The Company may also employ one or more groups to provide fund administration services, which may be the Investment Manager.

Should market conditions change nominally the Company will modify its strategy accordingly. However, should market conditions change substantially the Managing Member will assess the possibility of winding down the Company before thirty years elapse, and will have authority to make such a decision at its sole discretion.

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Deal Sources and Deal Flow

In executing on our business strategy, we believe that we will benefit from the track record and extensive experience of our Managing Member, Investment Manager and their respective principals, officers, managers, members and other entities affiliated with the Company, the Managing Member, the Investment Manager and their related officers, directors and owners ("Affiliate"). Specifically, we believe that we will benefit from the extensive combined operational experience of Good Steward Capital Management Inc. (the "Investment Manager") and GCA Equity Partners, LLC, a principal of the Managing Member ("GCA", and, together with the Investment Manager, the "Sponsors"). The Company's investment opportunities are sourced through a loan origination process that relies upon the expertise of GCA and the Investment Manager. The traditional method consists of origination through licensed broker channels, real estate agents and other conventional sources. The Sponsor, Managing Member and Investment Manager will leverage their networks of industry connections to originate bulk business through private equity funds, contractors, developers, hedge funds and larger real estate investment firms. At no time will the Company accept any loans except through licensed real estate brokers, attorneys or other licensed mortgage brokers or lenders. The Company, the Managing Member of the Company or an Affiliate may acquire and/or obtain a license and may then broker loans to the Company for an additional fee.

¹³Regardless of precautionary measures, cost overruns can and do occur. The borrower is responsible for anyadditional expenses to complete repairs, however it may be necessary for the Company to covers these costs in some cases. Cost overruns that must be fronted by the Company may be recouped through aMechanic's Lien on the subject property.

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LENDING STANDARDS AND POLICIES

General

The Managing Member will have the sole authority to manage the affairs of the Company including the sole authority to: (i) monitor and assess Company performance and set the Company's accounting procedures; (ii) oversee rehabilitation, management, leasing, and disposing of properties; and (iii) otherwise direct the day-to-day operations of the Company. The Investment Manager has been delegated the sole authority to identify properties to be loaned against or purchased by the Company. Members will have limited rights to vote on or direct the actions of the Company and must rely upon the Managing Member to make decisions in the best interests of the Company. (See "Risk Factors—Risks Related to the Managing Member" and "Conflicts of Interests.")

General Standards for Mortgage Loans

The Company will engage in investing in loans secured by mortgages or deeds of trusts secured by real or personal property located across the United States (including the Commonwealth of Puerto Rico). The Company's loans will not be guaranteed by any governmental agency or private entity, but may be guaranteed or cross-collateralized by affiliates and associates of the underlying borrowers.

The use of loan proceeds by the borrower will not generally be restricted. The Company may invest in loans that are themselves secured by a loan secured by a deed of trust or mortgage. In these cases the underlying loan instruments will be assigned to the Company as collateral for its loan pursuant to agreements that govern the collection of the Company's loan as well as the underlying loan collateral.

In addition to deeds of trust or mortgages, the Company may secure repayment of the loans by such devices as co-signers, promissory notes, personal guarantees, irrevocable letters of credit, assignments of deposit or stock accounts, personal property, partnership interests, and limited liability company interests.

The Company will select loans according to the standards provided below:

1. Lien Priority. The deeds of trusts and mortgages securing the Company's loans may be first liens, second liens, or subordinate liens at the Investment Manager and Managing Member's discretion. In addition, the Company may fund loans in which it shares a first lien with an Affiliate as a co-lender, or the Company may fund a loan secured by a junior lien on real property to which an Affiliate has a senior lien. The Company will lend money and secure the loan by such deeds of trusts and mortgages if the Loan-to-Value ratios in Section 3 below are met.

2. Location of Real Property Securing Loans. The Company may make loans as it deems appropriate in any state of the United States, as well as the Commonwealth of Puerto Rico.

3. Loan-to-Value Ratio. A loan from the Company will generally not exceed the Loan-to-Value percentage ratios set forth below. The Loan-to-Value ratio is calculated by taking the amount of the Company's Loan combined with the amount of outstanding debt secured by other liens on the property, dividing that by the estimated completed Value of the real property securing the deed of trust or mortgage and multiplying that figure by 100 to come to a percentage.  "Value" shall be determined by an independent certified appraiser or non-certified appraiser carrying out an appraisal on the real property, or the Investment Manager, or commercial or residential real estate broker giving his, her, or its opinion of the Value of the real property. Notwithstanding the foregoing, the Company may exceed the below stated Loan-to-Value ratios if the Investment Manager or Managing Member determines in its business judgment that a higher loan amount is warranted by the circumstances of that particular loan, such as being able to secure Loans against multiple unconnected properties, personal guaranties from the borrower, prior loan history with the borrower, market conditions, if mortgage insurance is obtained, or other compensating factors that would support the Managing Member in making its decision in the best interest of the Company.   Upon analysis in approximately twenty-four (24) months, the Managing Member will re-evaluate the portfolio and Loan-to-Value ratio maximums set by the Company and may revise the Loan-to-Value ratio maximums at that time if it considers it to be in the best interests of the Company.

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4. Evaluation and Pricing of Financing Opportunities

The financing of each corresponding Loan generally commences with an individual or real estate investment or development company requesting financing from the Company. The amount financed generally ranges from $50,000 to $5,000,000, and the term of the indebtedness generally ranges from six months to five years.

The Company reviews the proposed investment opportunity and pursues debt investment opportunities where the total amount of the loan, excluding loan interest reserves, will generally not exceed a certain percentage (the "Loan to Completed Value Ratio") of the value of the property securing the loan, as set forth below:

Type of Property	Loan to Completed Value Ratio (excluding loan interest reserves)
Improved Commercial or Residential	70%
New Construction; Commercial or Residential  (based on after completed value)	70%
Rehabilitation; Commercial or Residential (based on after repaired value)	70%
Single-family residentially zoned lot or parcel which has installed offsite improvements including drainage, curbs, gutters, sidewalks, paved roofs, and utilities as mandated by the political subdivision having jurisdiction over the lot or parcel.	60%
Land and Entitlement	50%

In general, the Company will seek to maintain a weighted Loan to Completed Value ratio for the Company of seventy percent (70%) or less (excluding loan interest reserves); provided that the maximum Loan to Completed Value ratio for the Company may exceed such amount if the Managing Member determines in its sole discretion that it is in the best interests of the Company to exceed such ratio in any single or multiple instances.

The foregoing Loan-to-Value ratios do not apply to purchase-money financing offered by the Company. Examples of these types of loans may be, but are not limited to, real estate owned by the Company whereby the Company decides to sell the property and carry back a loan on the property to make it cash flow positive.

5. Terms of Loans. The terms of the Loans will vary. Loans generally have a term between six (6) months and two (2) years, but most Loans will have terms of twelve (12) to twenty-four (24) months. Many loans that the Company will originate or acquire may provide for interest-only payments followed by a balloon payment at the end of the term. For risk hedging purpose, borrowers may be required to make interest payments and in some cases, payments of principal and interest. At the end of the term, the Company will require the borrower to pay the loan in full, to refinance the loan, or to sell the real property to pay back the loan. The Company may allow extensions of three to six months for a fee paid by Company borrowers.

6. Interest Rates. Most loans acquired by the Company will provide for a higher interest rate than the mortgage rates prevailing in the geographic area where the security property is located (which will normally be at a rate of 10.0% or greater).

7. Title Insurance. Satisfactory title insurance coverage will be obtained for all loans and will usually be paid by the borrower. The title insurance policy will name the Company as the insured and provide title insurance in an amount not less than the principal amount of the loan unless there is multiple forms of security for the loan, in which case the Managing Member shall use its sole business judgment in determining whether and to what extent title insurance shall be required. Title insurance insures only the validity and priority of the Company's deed of trust or mortgage, and does not insure the Company against loss from other causes, such as diminution in the value of the secured property, loan defaults, and other such losses.

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8. Fire and Casualty Insurance. Satisfactory fire and casualty insurance will be obtained for all improved real property loans which insurance will name the Company as its loss payee in the amount equal to the improvements on the real property. (See "Business Risks – Uninsured Losses" below.)

9. Mortgage Insurance. The Managing Member does not intend to, but may if the property otherwise qualifies, arrange for mortgage insurance, which would afford some protection against loss if the Company foreclosed on a loan and there existed insufficient equity in the security property to repay all sums owed.

10. Acquiring Loans from Other Lenders. In the event the Company acquires loans from other lenders, the Company will receive assignments of all beneficial interest in any loans purchased, including the rights to any security liens or equity positions.

11. Purchase of Loans from Affiliates. The Company may purchase loans from and provide loans to the Managing Member, the Investment Manager and Affiliates so long as it meets the lending requirements set forth above.

12. Size of Loans. Subject to the Investment Manager's discretion, most Loans will be between Fifty Thousand Dollars ($50,000) and Five Million Dollars ($5,000,000). Certain loans may call for a higher or lower loan amount than prescribed herein depending on specific types of projects.

13. Equity Participation and Mezzanine Positions. The Company may fund mezzanine mortgage loans at lower than market interest rates in order to obtain an equity interest in the underlying real property in which the Company funds the loan. The Investment Manager will only authorize the Company to make such a loan if the Investment Manager believes in its sole business judgment that it is in the best interests of the Company to do so.

Credit Evaluations

The Managing Member will consider the general creditworthiness of a borrower to determine his, her or its ability to repay the loan according to its terms in addition to considering the loan-to-value ratios described above and secondary sources of security for repayment. However, the Company may lend to borrowers based primarily on the value of the equity in the property, if the Managing Member, in its sole discretion, deems such a decision to be in the best interest of the Company. The Company may acquire loans made to borrowers who are in default under other obligations (e.g., to consolidate their debts) or who do not have sources of income that would be sufficient to qualify for loans from other lenders such as banks or savings and loan associations.

Loan Servicing

It is presently anticipated that all Company Loans will be serviced (i.e., loan payments collected and other services relating to the loan) by Good Steward Lending Services, Inc. or another third party loan servicing company ("Servicer") to be selected by the Managing Member. In addition, the Managing Member or an Affiliate of the Managing Member may supervise or otherwise provide oversight of such Servicer. At its sole election, the Managing Member may choose to service all Loans through the Managing Member (or an Affiliate of the Managing Member) rather than through the third party loan servicer. The Servicer will be compensated by the Company, Managing Member and/or borrowers for such loan servicing activities, as is agreed upon by the Managing Member and Servicer. To the extent applicable, the Managing Member will oversee the activities and performance of the Servicer. (See "The Managing Member and Affiliates" below.) At any time, at the sole and absolute discretion of the Managing Member, in an effort to maintain an effective cost structure or for any other reason (or no reason), the Managing Member may decide to service the Company loans in-house at such time as conditions warrant.

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Most loans will require interest payments at the end of each thirty (30) day period, commencing on the last day of the first full month of the loan and computed on the principal balance during such thirty (30) day period. Typically, these payments will come from the loan's interest escrow account (set up at the time of loan origination). Alternatively, borrowers can make their checks payable to the Servicer or the Company. Checks payable to the Servicer will be deposited in Servicer's loan servicing trust account, and funds will be transferred to the Company's bank or money market account.

The Company may, within its sole and absolute discretion, require the Servicer to adhere to the following Payment, Delinquency, Default, and Foreclosure practices, procedures and policies:

1. Payments. Generally, principal payments will be paid as one balloon payment at the expiration of the loan period. The payment due date will be the expiration of the Loan.

2. Delinquency. Generally, Loans will be considered delinquent if no payment has been received within ten (10) days of the payment due date. Borrower will be notified of delinquency by mail on the twelfth (12th) day after the payment due date and a late charge will be assessed. The Servicer will refer to and rely upon the late charge provisions in the applicable loan documents for each loan.

3. Default. A Loan will be considered in default if no payment has been received within thirty (30) days of the payment due date. Foreclosure may be initiated shortly after the thirty-first (31^st) day after a default, with the exact timing in the business judgment of the Managing Member. However, the Managing Member will retain the option of making payments on behalf of the borrower for a limited period of time if it determines that such payments are in the best interests of the Members. Any costs of either the foreclosure process or of loan payments are to be posted to the borrower's account for reimbursement to the Company.

4. Foreclosure. Statutory guidelines for foreclosures in each state are to be followed by the Servicer until the underlying property is liquidated and/or the account is brought current. Any costs of this process are to be posted to the borrower's account for reimbursement to the Company. If a loan is completely foreclosed upon and the property reverts back to the Company, the Company will be responsible for paying the costs and fees associated with the foreclosure, process, maintenance and repair of the property, service of senior liens and resale expenses.

The servicer will generally act in according with the following guidelines under the applicable agreement:

The servicer will be required to comply with applicable notice requirements.

· The servicer will comply with the provisions of all applicable requirements and the loan documents relating to the giving of all notices or other communications required to be given by or on behalf of the Company to any mortgage insurer, title insurer, or other insurer or guarantor, as applicable. When any applicable requirement or the loan documents require any notice or other communication to be given to an obligor, the servicer will, in the absence of instructions to the contrary from the Company, give such notice or other communication to the mortgage loan borrower.

· Where applicable, the servicer will be responsible for preserving, protecting, and maintaining the property collateral.

· Where applicable, the servicer will, as a property protection expense if not paid by a borrower, assure that each mortgaged property is insured against risks, hazards, and liabilities as required by all applicable requirements and the loan documents, in an amount at least equal to the unpaid principal balance of the loan, by a financially sound and reputable carrier. The servicer will follow industry accepted servicing practices respecting the protection of property on which the Company's loan is subject to senior mortgage loans.

· Where applicable, the servicer will retain copies of all applicable hazard insurance policies or certificates of insurance representing such coverage. When the borrower does not insure a property, the servicer is required to place adequate hazard insurance on the property and charge the cost against the escrow fund or the borrower, as provided in the loan documents.

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· Where applicable, in the event of an insured property loss, the servicer will promptly file a claim on the hazard insurance, unless the servicer has actual knowledge that the borrower has already filed such a claim, and apply or disburse all insurance proceeds respecting mortgaged property in accordance with the terms and provisions of the loan documents and applicable requirements.

· The servicer will comply with the terms of mortgage insurance and guarantees relating to any loan and will use its best efforts to maintain such mortgage insurance and guarantees in full force and effect, provided that the servicer has actual knowledge of such insurance or guaranty. The servicer will be responsible for submitting a claim under any mortgage insurance or other guaranty or insurance on a timely basis provided that the servicer has actual knowledge of such insurance or guaranty.

· The servicer will prepare promptly each report required by all applicable requirements including reports to be delivered to all governmental agencies having jurisdiction over the servicing of the loans and the escrow accounts.

· The servicer will be responsible for maintaining adequate facilities and experienced staff to carry out its obligations hereunder.

· The servicer will be responsible for using measures consistent with industry accepted servicing practices attempt to collect delinquent payments on each loan.

Default Management, Loss Mitigation

The servicer will be authorized and empowered by the Company to complete on behalf of the Company documents to maintain the lien on the collateral, amend or modify the loan obligation, release or discharge the obligation and take other collection efforts as may be necessary or advisable in the default management of the loans.

As part of the Managing Member's loss mitigation strategy, the Managing Member and servicer plan to employ the following strategies:

· Communication with borrowers, on any Loan that is past due.

· Possible Resolutions (if necessary to maintain the value of the asset).

· Note modification/payment negotiation to enhance the borrower's ability to pay.

· Payment deferment to eventually increase the ability to pay.

· Principal reduction to encourage either the refinance of the Loan or Loan Interest or the sale of the underlying property.

· Subordination of either a portion of the debt or the balance of the debt to allow the borrower to improve their position and to increase the ability to pay.

In addition, there may be situations where the Managing Member deems it advisable to allow a Loan or Loan Interest to go into default and to temporarily forbear from the enforcement of the Loan or Loan Interest until such time as the borrower is able to resume making payments or until the sale or refinance of the property. The Managing Member would not, however, release its lien position and would continue to accrue interest as set forth in the applicable Note. Upon the sale of the property or refinance of the Loan or Loan Interest, the Managing Member would seek to enforce its lien and collect the amounts due, including accrued but uncollected interest at such time. This longer term strategy will be particularly effective once sales prices begin increasing again.

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Sale of Loans

The Company does not plan on investing in mortgage loans for the primary purpose of reselling such loans in the course of business. However, the Company may sell mortgage loans, or fractional interests in such loans, when the Managing Member or Investment Manager determines (in its sole and absolute discretion) that it appears to be advantageous for the Company to do so, based upon then current interest rates, the length of time that the loan has been held by the Company and the overall investment objectives of the Company.

Leveraging

The Company may borrow funds from a third party lender to fund investments in Loans. These loans would be secured by the Loans held by the Company. Leveraging involves additional risks that are detailed later in this Offering Circular.

Borrowing/Note Hypothecation

The Company may borrow funds pursuant to one or more credit lines or similar debt instruments for the purpose of making and purchasing Loans and may assign all or a portion of its Loan portfolio as security for such loan(s). The Company anticipates engaging in this type of transaction when the interest rates at which the Company can borrow funds is significantly less than the rate that can be earned by the Company on its loans, giving the Company the opportunity to earn a profit as a "spread." Such a transaction involves certain elements of risk and also entails possible adverse tax consequences. (See herein "Risk Factors", "Income Tax Considerations", and "ERISA Considerations" below.) The Company may also in its sole discretion elect to finance the Company's investments with borrowed funds.

Loss Reserve

A loss reserve may be maintained by the Company. This loss reserve is intended to temporarily protect members from potential unrecoverable losses from the Company's business and operating activities. Although the loss reserve will help reduce the impact of defaults temporarily, ultimate repayment/resale of the Loans will be jeopardized to the extent that any Loans are in default and are not eventually repaid or resold, whether by the applicable borrower or by the Company, to protect available collateral. Depending on reserve overages and the weighted risk levels of the portfolio, reserve amounts may be reduced, eliminated or increased accordingly in the sole and absolute discretion of the Managing Member. The loss reserve will initially be funded from the proceeds of the Offering, and thereafter may be funded from Offering proceeds or cash flow and/or profits of the Company (as is determined by the Managing Member in its sole discretion).

Loss reserve amounts will not be invested in Loans. Contingency reserve funds may be invested in short-term investments such as money market accounts which provide liquidity and a lower yield than might be earned on mortgage notes. The Managing Member will set the amount of the reserve in its business judgment. The Managing Member expects that the loss reserve will usually be set at one percent (1.0%), but may range between one-quarter of one percent (0.25%) to five percent (5%).

The loss reserve may be used for any and all losses relating to Loans in the Company's portfolio, including, but not limited to, the following: (a) litigation and (b) trustee and other fees relating to the default of a loan in the Company's portfolio and (2) unexpected operating expenses.

The Managing Member will, in its sole and absolute discretion, determine the loss reserve.

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 Investments in Commercial Real Property

In instances where we invest through a majority-owned subsidiary, we will have major decision rights over matters, including, but not limited to, financing, refinancing, sale, and material changes to the underlying real estate. Our majority-owned subsidiaries will generally make investments that meet the following criteria: (i) our subsidiary will exercise ongoing control rights over the management of the underlying property (e.g., consent rights over sale, refinance, major project decisions, development plans, budgets, raising additional equity or debt, etc.), (ii) our subsidiary will have approval rights in connection with any material decision pertaining to the administration and servicing of any mortgage loan and with respect to any material modification of such mortgage loan agreements that encumber the underlying property, (iii) our subsidiary will have recognition from the mortgage lender entitling it to notice of defaults, the right to readily cure monetary or non-monetary defaults or purchase the mortgage loan in the event of a default on the mortgage loan, and (iv) our subsidiary will have the right to unilaterally force the sale or purchase the property upon a default under the Operating Agreement, and, through its ownership of the property-owning entity, become the sole owner of the underlying property.

We intend to leverage the experience and expertise of our Managing Member and its management team, as well as their origination capabilities and extensive financial institution relationships to identify investment opportunities that are appropriate for our investment portfolio at the appropriate time in the real estate cycle. Certain owners of commercial real property are suffering distress. This fact and reduced demand by buyers for such properties has led to price reduction and as a result, the opportunity for higher returns. Improved economics may present an opportunity for us to lend against or acquire such properties. We expect that these properties would have occupancy levels consistent with the performance of the local market and would generate accretive and immediate cash flow. In particular, our sponsor and its real estate professionals who will be performing services for us on behalf of our Managing Member have extensive experience in acquiring, managing and disposing of net lease properties. Net lease properties generally have a small number of tenants with longer leases and few or no landlord responsibilities. We will manage and dispose of any real property assets we acquire in the manner that our Managing Member determines is most advantageous to us. 

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MANAGEMENT

The Managing Member

The Company is managed by SREIF MANAGER II, LLC (the "Managing Member"), a Nevada limited liability company.  The Managing Member was formed on June 15, 2016 and is the Managing Member of the Company. Its principal business offices are located at 1999 South Bascom Avenue, 7^th Floor , Campbell, CA 95008. The Managing Member is owned by GCA Equity Partners, LLC, a Nevada limited liability company ("GCA"), Crowdventure, LLC, a Nevada limited liability company ("Crowdventure") and Amherst Enterprises, Ltd, a New York subchapter S corporation ("Amherst"). The Managing Member is responsible for the overall management of the Company's affairs and has control over the day-to-day operations and activities of the Company.

Principals the of Managing Member

The Principals of the Managing Member consist of seasoned real estate professionals with significant real estate investment and management services. The Principals of the Managing Member and their positions and offices are as follows:

Name	Age	Position
Thomas Braegelmann	56	Chief Executive Officer
Charles Tralka	52	Chief Investment Officer
Matthew Sullivan	51	Director of Investor Relations
Jordan Goodman	61	Investment Manager

Thomas Braegelmann, Chief Executive Officer Since September 2011,Mr. Braegelmann has been the Chief Executive Officer and managing member of GCA. Mr. Braegelmann is an accomplished entrepreneur, fund manager and private lending mentor offering a wealth of experience and knowledge gained during his 30+ year career in real estate investing, commercial construction, land development and private lending. Through careful investment analysis and emphasis on secured investments, as well as the development of the unique National Construction Lending Alliance™ program, Mr. Braegelmann and partners have shown a consistent track record of delivering double digit returns to their investors on short-term, passive real estate investments. With Mr. Braegelmann's leadership, and through the development of the National Construction Lending Alliance™ program, GCA participated in the funding of more than $100 million in real estate transactions nationwide in under 18 months. As a native of Central Minnesota, Mr. Braegelmann previously served as owner and CEO of a private real estate investment company, with a portfolio comprised of several hundred multi-family apartment units, residential and commercial complexes, and single-family homes. With a passion for facilitating and teaching collaborative real estate investing, Mr. Braegelmann donates his time and serves as a well-respected, highly sought after mentor and teacher for a group of more than 400 passive real estate investors around the country. He also founded and hosts a monthly REIA/Private Investment club with over 2100 members in the San Francisco Bay area. Mr. Braegelmann is committed to giving back to the community and building sustainable cash flow for passive real estate investors.

Charles Tralka, Chief Investment Officer. Mr Tralka has been a managing member of GCA Equity Partners, LLC since September 2011. He is a former high-technology executive, having served in a variety of engineering and marketing management roles during his 23-year career in that industry.While working in high-tech, he began investing in various real estate projects and over the last twenty years has bought, held and sold multiple investment properties.Since 1990 he has been an active investor in real estate and real estate investment funds focused on the financial aspects of the business. Mr. Tralka has a passion for helping investors achieve their financial goals through careful selection of the right investments and in particular for helping people optimize returns for their own retirement accounts.Mr. Tralka is a graduate of the University of California, Davis and holds a degree in electrical engineering from that institution.During his high-tech career he served in various roles at Altera Corporation, Aptix, Inc., QuickLogic Corporation and Xilinx, Inc.

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 Matthew Sullivan, Director of Investor Relations. Since January 2015Mr. Sullivanhas been the president of Crowdventure, a real estate crowdfunding company. Prior to that (Nov 2012 – September 2014) he was president of Clearway Sustainability Solutions Ltd, a UK based company that provided corporations with sustainability solutions and access to the global carbon markets. From September 2007 to August 2013 he was the president of Crowd Source Solutions Ltd, a UK based company which provided corporate carbon offsetting and sustainability solutions using innovative web based technologies. Mr. Sullivan went to Westminster School in London, UK and studied Law at Birmingham University before pursuing a career in finance and stockbroking, specializing in the South East Asian markets. In 1997 he chose an entrepreneurial path and founded Europe's first internet billing application service provider. Since then his career has been focused on finance and technology.

Jordan Goodman, Investment Director. Mr. Goodman has been president of Amherst continuously since March 1993. Amherst is a financial education company that provides marketing services to high quality financial companies. Mr Goodman is also known as "America's Money Answers Man" and is a nationally-recognized expert on personal finance. He is a regular guest on numerous radio and television call-in shows across the country, answering questions on personal financial topics. He appears frequently on The View, Fox News Network, Fox Business Network, CNN, CNBC and CBS evening news. For 18 years, Mr. Goodman was on the editorial staff of Money magazine, where he served as Wall Street correspondent. While at Money, he reported and wrote on virtually every aspect of personal finance. In addition, he served as weekly financial analyst on NBC News at Sunrise for 9 years and the daily business news commentator on Mutual Broadcasting System's America in the Morning show for 8 years. He is the author / co-author of 13 best-selling books on personal finance including Master Your Debt Fast Profits in Hard Times, Everyone's Money Book, Master Your Money Type, Barron's Dictionary of Finance and Investment Terms and Barron's Finance and Investment Handbook. He has also written 6 special focus editions of Everyone's Money Book on College, Credit, Financial Planning, Real Estate, Retirement Planning and Stocks, Bonds and Mutual Funds. Mr. Goodman is also a speaker and seminar leader on personal finance topics for business executives, students, associations, investment clubs, employees and others.

Duties of Managing Member

The Managing Member performs its duties and responsibilities pursuant to the terms of the Operating Agreement. In managing and conducting the business and affairs of the Company, the Managing Member may, among other things, cause the Company to take such actions as the Managing Member reasonably determines in good faith to be necessary, appropriate, advisable, incidental or convenient to effect the formation of the Company, promote or conduct the Company's business or achieve the Company's objectives. The Managing Member maintains a contractual, as opposed to a fiduciary relationship, with the Company and its members. Furthermore, the Company has agreed to limit the liability of the Managing Member and to indemnify the Managing Member against certain liabilities. The Managing Member shall have the following responsibilities:

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Management and Other Administrative Services

· · ·	oversee the overall management of the Company; develop investment strategies and objectives and implement such strategies; manage and perform the various administrative functions necessary for our day-to-day operations;
·	provide or arrange for administrative services, legal services, office space, office furnishings, personnel and other overhead items necessary and incidental to our business and operations;
·	provide financial and operational planning services and portfolio management functions;
·	maintain accounting data and any other information concerning our activities as will be required to prepare and to file all periodic financial reports and returns required to be filed with the SEC and any other regulatory agency, including annual financial statements;
·	maintain all appropriate company books and records;
·	oversee tax and compliance services and risk management services and coordinate with appropriate third parties, including independent accountants and other consultants, on related tax matters;
·	make, change, and revoke such tax elections on behalf of the Company as the Managing Member deems appropriate;
·	supervise the performance of such ministerial and administrative functions as may be necessary in connection with our daily operations;
·	manage and coordinate with the transfer agent, if any, the process of making distributions and payments to members;
·	evaluate and obtain adequate insurance coverage based upon risk management determinations;
·	provide timely updates related to the overall regulatory environment affecting us, as well as managing compliance with regulatory matters;
·	evaluate our corporate governance structure and appropriate policies and procedures related thereto; and
·	oversee all reporting, record keeping, internal controls and similar matters in a manner to allow us to comply with applicable law.

Member Services

· determine our distribution policy and authorizing distributions from time to time;

· approve amounts available for redemptions of our Class A Units;

· manage communications with our members, including answering phone calls, preparing and sending written and electronic reports and other communications; and

· establish technology infrastructure to assist in providing member support and services.  

 Financing Services

· identify and evaluate potential financing and refinancing sources, engaging a third party broker if necessary;

· negotiate terms of, arrange and execute financing agreements;

· manage relationships between us and our lenders, if any; and

· monitor and oversee the service of our debt facilities and other financings, if any.

Asset Acquisition and Disposition Services

· ·	approve and oversee the investment strategy, which will consist of elements such as investment selection criteria, diversification strategies and asset disposition strategies; assist Investment Manager in evaluate and approve potential asset dispositions, sales or liquidity transactions;
·	structure and negotiate the terms and conditions of transactions pursuant to which our assets may be sold;
·	adopt and periodically review our investment guidelines;
·	obtain market research and economic and statistical data in connection with our investments and investment objectives and policies;
·	oversee and conduct the due diligence process related to prospective investments;
·	negotiate and execute approved investments and other transactions; and
·	approve any potential liquidity transaction.

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The Investment Manager

The Managing Member has delegated investment advisory and management responsibilities to the Investment Manager. Subject only to the provisions of the Operating Agreement, its delegation of authority to the Investment Manager and the requirements of applicable law, the Managing Member shall possess full and exclusive right, power and authority to manage and conduct the business and affairs of the Company.

Good Steward Capital Management, Inc. (the "Investment Manager""), an Arizona corporation, has been appointed as the Investment Manager of the Company, pursuant to an Investment Management Agreement (the "IMA"), and in that capacity has discretionary investment authority over the Company's assets. The Managing Member and the Investment Manager may each employ additional personnel. The Investment Manager is responsible for investing the capital and resources of the Company and monitoring such investments, as necessary, in order to achieve the Company's investment objective. The Investment Manager is an Affiliate of Good Steward Lending Services, Inc., the servicer of the Company's loan portfolio.

Principals of the Investment Manager

Robert Barr. Robert has been Founder and President of Good Steward Capital Management, Inc ('GSCM') since January 2012. Prior to founding GSCM he was a financial adviser at H. Beck, Inc (June 2009 – January 2012). Robert joined the U.S. Navy as a Cryptologist in 1988 and served 6 years. After being awarded the Navy Achievement Medal in 1991 and serving in several critical positions, Robert left the Navy with a goal of taking his wealth of international experience and objective analytical skills to private sector business and finance. With over 23 years of business and finance experience, Robert has held positions ranging from Owner, CFO, CEO, and Financial Advisor. As a Financial Advisor Robert successfully managed million dollar fixed income portfolios during the height of the financial crisis. True to his belief in stewardship and particularly financial stewardship, Robert started Good Steward Financial Services Group in 2009 to provide financial consulting to businesses, individuals, and retirement plans. The Good Steward family of companies includes Good Steward Capital Management, Inc., Good Steward Lending Services, Inc. and Good Steward Account Services, Inc. The Good Steward companies provide specialized services to the real estate and real estate financing industry including capital management, loan servicing, fund administration, and mortgage brokering.

Mark Ross. Mark has been Director of Lending Services at Good Steward Lending Services since October 2014. From December 2012 – September 2014 he was the branch manager at Gencor Mortgage, Inc. Mark served as president of Prime Capital, Inc from January 1986 to December 2012. Mark has been in the mortgage industry for 43 years, focusing on conventional, commercial and private money lending (and the sale of existing paper). He has experience in running his own company for over 26 years, managing warehouse lines of credit, multiple loan originators, underwriting private money loans, and originating commercial and agency loans. He understands federal and state laws due to his involvement in writing the original Arizona Mortgage Broker law. He was previously the editor of a statewide mortgage publication and hosted a radio show for 5 years. From an industry perspective, Mark has been selected as one of five members of the Arizona Mortgage Brokers Testing Committee, responsible for writing and updating the Arizona Mortgage Loan Originator licensing test, and continues to teach licensing and renewal classes for loan originators.

Duties of Investment Manager

The responsibilities of the Investment Manager include:

Investment Advisory, Origination and Acquisition Services

· Implement the investment strategy as presented by the Managing Member, which will consist of elements such as investment selection criteria, diversification strategies and asset disposition strategies;

· serve as our investment and financial manager with respect to originating, investing in and managing a diversified portfolio of real estate loans, real estate and other real estate-related assets;

· follow our investment guidelines as presented by the Managing Member;

· obtain market research and economic and statistical data in connection with our investments and investment objectives and policies;

· work with our Managing Member to oversee and conduct the due diligence process related to prospective investments;

· prepare reports regarding prospective investments that include recommendations and supporting documentation necessary for our Managing Member to evaluate the proposed investments; and

· negotiate and execute approved investments and other transactions.

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Offering Services

· assist the Managing Member in the development of this offering, including the determination of its specific terms;

· assist the Managing Member in the preparation and approval of all marketing materials to be used by us relating to this offering;

· the negotiation and coordination of the receipt, collection, processing and acceptance of subscription agreements, commissions, and other administrative support functions;

· creation and implementation of various technology and electronic communications related to this offering; and

· all other services related to this offering.

Asset Management Services

· investigate, select, and, on our behalf, engage and conduct business with our Managing Member deems necessary to the proper performance of its obligations under our Operating Agreement, including but not limited to consultants, accountants, lenders, technical managers, attorneys, corporate fiduciaries, escrow agents, depositaries, custodians, agents for collection, insurers, insurance agents, developers, construction companies and any and all persons acting in any other capacity deemed by our Managing Member necessary or desirable for the performance of any of the services under our Operating Agreement;

· monitor applicable markets and obtain reports (which may be prepared by our Managing Member or its Affiliates) where appropriate, concerning the value of our investments;

· monitor and evaluate the performance of our investments, provide daily management services to us and perform and supervise the various management and operational functions related to our investments;

· formulate and oversee the implementation of strategies for the administration, promotion, management, operation, maintenance, improvement, financing and refinancing, marketing, leasing and disposition of investments on an overall portfolio basis; and

· coordinate and manage relationships between us and any joint venture partners.

 Allocation of Investment Opportunities

The principals and Affiliates of our Managing Member as well as the Investment Manager have established and sponsored investment vehicles, companies and funds with similar or identical investment strategies as the Company, including SREIF I, and expect to establish and sponsor, additional investment vehicles and offerings in the future, and to continue to offer investment opportunities through their distribution channels. The Investment Manager provides investment management services for SREIF I, CARE Fund and other investment vehicles. CARE Fund was organized primarily for the purposes of providing financing services to real estate investors seeking to take advantage of unique opportunities in the distressed single family and multi-family residential property market in California.These additional investment vehicles have investment criteria that compete with the Company.

If a sale, financing, investment or other business opportunity would be suitable for more than one of these investment vehicles, the Investment Manager will allocate such opportunity among the Company, SREIF I, CARE Fund and any additional investment vehicles using its best business judgment. Any allocation of this type may involve the consideration of a number of factors that our Investment Manager determines to be relevant, including:

· the investment objectives and criteria of our sponsor and the other investment vehicles;

· the cash requirements of our sponsor and the other investment vehicles;

· the effect of the investment on the diversification of our sponsor's or the other investment vehicle's portfolio by type of investment, and risk of investment;

· the anticipated cash flow of the asset to be acquired;

· the income tax effects of the purchase;

· the size of the investment; and

· the amount of funds available.

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Indemnification and Limitations of Liability under the Investment Management Agreement

The IMA provides that to the extent the Investment Manager has duties (including fiduciary duties) and liabilities relating thereto to the Company or any member, the Investment Manager shall not be liable for monetary or other damages to the Company or member for the Investment Manager's good faith reliance on the provisions of the IMA or for: (A) losses sustained or liabilities incurred by the Company or a member as a result of errors in judgment on the part of the Investment , or any act or omission of the Investment Manager, if such losses or liabilities were not the result of the Investment Manager's willful misfeasance, bad faith or gross negligence in the performance of, or reckless disregard of, its duties under the IMA; (B) errors in judgment on the part of any person, or any act or omission of any person, selected by the Investment Manager to perform services for or otherwise transact business with the Company provided that, in selecting such person, the Investment Manager acted without willful misfeasance, bad faith or gross negligence; or (C) circumstances beyond the Investment Manager's control, including the bankruptcy, insolvency or suspension of normal business activities of any bank or other financial institution holding assets of the Company.

The IMA further provides that to the extent any Affiliate of the Investment Manager, or any shareholder, partner, member, director, officer, employee or agent of the Investment Manager or of any of its Affiliates ("Investment Manager Associate"), has duties (including fiduciary duties) and liabilities relating thereto to the Company or any member, such person shall not be liable for monetary or other damages to the Company or such member for such person's good faith reliance on the provisions of the IMA or for losses sustained or liabilities incurred by the Company or such member as a result of errors in judgment on the part of such person, or any act or omission of such person, if such losses or liabilities were not the result of such person's willful misfeasance or bad faith.

Pursuant to the IMA, the Company will, to the fullest extent permitted by law, indemnify each Investment Manager Associate from and against any and all Losses, except to the extent that it is determined (in a judgment or order not subject to further appeal or discretionary review by a court, governmental body or agency or self-regulatory organization having jurisdiction to render or issue such judgment or order) that an act or omission of such Investment Manager Associate was material to the matter giving rise to such Losses and that such Investment Manager Associate is not entitled to be exculpated from such Losses as described above.

Notwithstanding the foregoing, no exculpation or indemnification of an Investment Manager Associate shall be permitted to the extent such exculpation or indemnification would be inconsistent with the requirements of federal or state securities laws or other applicable law.

Limited Liability and Indemnification of the Managing Member and Others

Subject to certain limitations, our Operating Agreement limits the liability of our Managing Member, its officers, directors and members, for monetary damages and provides that we will indemnify and pay or reimburse reasonable expenses in advance of final disposition of a proceeding to our Managing Member, its officers and directors, our sponsor and our sponsor's member and Affiliates.

Our Operating Agreement provides that to the fullest extent permitted by applicable law our Managing Member, its officers and directors, our sponsor and our sponsor's members and Affiliates will not be liable to us.  In addition, pursuant to our Operating Agreement, we have agreed to indemnify our Managing Member, its officers and directors, our sponsor and our sponsor's members and Affiliates, to the fullest extent permitted by law, against all expenses and liabilities (including judgments, fines, penalties, interest, amounts paid in settlement with the approval of the company and attorney's fees and disbursements) arising from the performance of any of their obligations or duties in connection with their service to us or the Operating Agreement, including in connection with any civil, criminal, administrative, investigative or other action, suit or proceeding to which any such person may hereafter be made party by reason of being or having been the Managing Member or one of our Managing Member's directors or officers.

Insofar as the foregoing provisions permit indemnification of directors, officers or persons controlling us for liability arising under the Securities Act, we have been informed that, in the opinion of the SEC, this indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

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Term and Removal of the Managing Member

Our Operating Agreement provides that our Managing Member will serve as our manager for an indefinite term, but that our Managing Member may be removed by us, or may choose to withdraw as manager, under certain circumstances.

Our members may only remove our Managing Member at any time with 30 days' prior written notice for "cause," following the affirmative vote of two-thirds of our members. If the Managing Member is removed for "cause", the members will have the power to elect a replacement Managing Member upon the affirmative vote or consent of the holders of a majority of our Class A Units. "Cause" is defined as:

· our Managing Member's continued breach of any material provision of the Operating Agreement following a period of 30 days after written notice thereof (or 45 days after written notice of such breach if our Managing Member, under certain circumstances, has taken steps to cure such breach within 30 days of the written notice);

· the commencement of any proceeding relating to the bankruptcy or insolvency of our Managing Member, including an order for relief in an involuntary bankruptcy case or our Managing Member authorizing or filing a voluntary bankruptcy petition;

· our Managing Member committing fraud against us, misappropriating or embezzling our funds, or acting, or failing to act, in a manner constituting bad faith, willful misconduct, gross negligence or reckless disregard in the performance of its duties under the Operating Agreement; provided, however, that if any of these actions is caused by an employee, personnel and/or officer of our Managing Member or one of its Affiliates and our Managing Member (or such Affiliate) takes all necessary and appropriate action against such person and cures the damage caused by such actions within 30 days of our Managing Member's actual knowledge of its commission or omission, then our Managing Member may not be removed; or

· the dissolution of our Managing Member.

Unsatisfactory financial performance of the Company does not constitute "cause" under the Operating Agreement.

Our Managing Member may assign its rights under our Operating Agreement in its entirety or delegate certain of its duties under the Operating Agreement to any of its affiliates, without the approval of our members so long as our Managing Member remains liable for any such affiliate's performance, and if such assignment or delegation does not require our approval under the Advisers Act. Our Managing Member may withdraw as our Managing Member if we become required to register as an investment company under the Investment Company Act, with such withdrawal deemed to occur immediately before such event. Our Managing Member will determine whether any succeeding manager possesses sufficient qualifications to perform the management function. In the event of the removal or withdrawal of our Managing Member, our Managing Member will cooperate with us and take all reasonable steps to assist in making an orderly transition of the management function.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The principals of the Managing Member and the Investment Manager are also the managers and investment managers of Secured Real Estate Income Fund I, LLC, a Delaware limited liability company ("SREIF I").  GCA is a principal of the Managing Member of the GCA California Real Estate Fund, LLC, a California limited liability company ("CARE Fund").  Both SREIF I and CARE Fund engage in investment strategies which are similar to that of the Company.

Since July 1, 2016, the Company has had a line of credit for borrowings of up to $125,000 from the Managing Member. Borrowings are subject to interest at 5%, per annum, and due together with interest on June 1, 2017. As of December 31, 2016, the Company had borrowings totaling $85,051 and accrued interest of $1,207. As of December 31, 2016, the Company had $39,949 available under the line of credit. Interest expense was $1,207 for the period ended December 31, 2016. Subsequent to December 31, 2016, the Company increased their borrowing capacity to $150,000.

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PRIOR PERFORMANCE SUMMARY

The following prior performance summary provides information relating to the real estate investment programs (collectively, the "Prior Programs") sponsored by GCA, Good Steward Capital Management, Inc., an Arizona corporation ("GSCM") and their respective affiliates (collectively referred to herein as our "Sponsors").  One hundred percent (100%) of the data represented in the tables below is based upon activities of programs with investment objectives similar to that of the Company.

The information presented in this section represents the historical operating results for our Sponsors and the experience of real estate programs sponsored by our Sponsors, which we refer to as the "prior real estate programs."

Investors in our Class A Units should not assume that they will experience returns, if any, comparable to those experienced by investors in our Sponsor s' prior real estate programs. Investors who purchase our Class A Units will not thereby acquire any ownership interest in any of the entities to which the following information relates.

The returns to our members will depend in part on the investments which we make. As our portfolio may not mirror the portfolios of our S ponsors' affiliated prior real estate programs in any of these respects, the returns to our members may vary from those generated by our Sponsors' prior real estate programs. The prior real estate programs were conducted through privately-held entities, a majority of which have been in the form of specialized lending trusts ("SLTs"), that were not subject to the fees and expenses associated with this offering or many of the laws and regulations to which we will be subject. In addition, our Sponsors are self-managed, privately-held companies with an indefinite duration. As a result, you should not assume the past performance of our Sponsors or the prior real estate programs described below will be indicative of our future performance.

Overview of our Sponsors' prior performance

GCA is a Nevada limited liability company founded in September 2011. GSCM was founded in 2012. Since September 2011 our Sponsors have syndicated more than $150,000,000 in real estate equity and debt capital through various specialized lending trust investment vehicles, in addition to SREIF I and CARE Fund.

For the three year period from January 1, 2014 to December 31, 2016 , our Sponsors have raised and invested approximately $40 Million in debt capital for investments in its prior real estate programs.

Investments have been diversified by size, security, type and geographic region. The investment strategy for our Sponsors is to provide income generation and capital preservation and appreciation through extending real estate secured loans. The loans are located in California, Alabama, Tennessee, Georgia, Arizona , Virginia, Texas, Maryland, Colorado, North Dakota, and South Carolina.

For the five year period from January 1, 2012 to December 31, 2016 , our Sponsors  have provided their investors with an (unaudited) average annualized return of 13. 22% .

California Real Estate Fund, LLC

Since March 2012 GCA has acted as principal of the Managing Member to the GCA California Real Estate Fund, LLC (CARE Fund). CARE Fund is a California limited liability company formed in January of 2012 that ceased accepting new investments in April of 2014. CARE Fund engages in an investment strategy which is similar to that of the Company and invests in loans collateralized by single family and multifamily non-owner occupied residences and commercial properties. For its loan portfolio, CARE Fund secures loan investments with first and/or second position security interests and, on occasion and where possible, an equity position in the borrowing entity.   As of the date of this Offering Circular, CARE Fund has raised approximately $2.75 Million through a private offering conducted pursuant to the Intrastate Exemption from 43 investors. From inception in March 2012 to March 31^st 2016 CARE Fund has generated an average 12.1% annualized return to its investors (unaudited). The prior performance for the CARE Fund is included in the Prior Performance Tables listed below.

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Secured Real Estate Income Fund I, LLC

Since April 2016 GCA Equity Partners and Good Steward Capital Management have acted as principal of the Managing Member and the Investment Adviser respectively to the Secured Real Estate Income Fund I, LLC ( 'SREIF I' ). SREIF I is a Delaware limited liability company formed on May 13, 2015. SREIF I engages in an investment strategy which is similar to that of the Company and invests in loans collateralized by single family and multifamily non-owner occupied residences and commercial properties. For its loan portfolio, SREIF I secures loan investments with first and/or second position security interests and, on occasion and where possible, an equity position in the borrowing entity.As of the date of this Offering Circular, SREIF I has raised approximately $2.1M through a private offering conducted pursuant to Rule 506 of Regulation D from 36 investors. From inception in April 2016 to December 31^st, 2016 SREIF has generated an 8% annualized return to its investors (unaudited). The prior performance for SREIF is included in the Prior Performance Tables listed below .

Prior Performance Tables

The following performance tables for the Prior Programs ("Tables") present information relating to the real estate investment programs sponsored by the Sponsors. One hundred percent (100%) of the data represented in the tables below is based upon activities of programs with investment objectives similar to that of the Company.

The Prior Programs focus on originating and/or facilitating investments in real estate debt securities. The general investment objectives for all Prior Programs include providing investors with (i) exposure to investment in real estate-related securities with favorable risk-adjusted returns and (ii) current income.  These Tables provide information on the performance of private programs only.

The inclusion of the Tables does not imply that we will make investments comparable to those reflected in the Tables or that investors in our shares will experience returns comparable to the returns experienced in the Prior Programs referred to in the Tables. In addition, you may not experience any return on your investment. Please see "Risk Factors" If you purchase our Class A Units, you will not acquire any ownership in any of the Prior Programs to which the Tables relate.

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TABLE I

EXPERIENCE IN RAISING AND INVESTING FUNDS

(UNAUDITED)

Table I-A presents summarized information showing the experience of our Sponsors in raising and investing funds for offerings with similar investment objectives that have concluded from January 1^st 2014 through December 31, 2016. Information is for all of their respective real estate debt investment programs. All figures are as of December 31, 2016.

	January 1 2014 – December 31 2014	January 1 2015 – December 31 2015	January 1 2016 – December 31 2016
Dollar Amount Offered	$17,205,840	$13,934,667	$38,661,737
Dollar Amount Raised	$17,205,840	$13,934,667	$10,579,657
Length of Offering (months)(1):	18	18	18
Months to invest 90% of amount available for investment	1	1	1
(1)  These figures denote the average duration of the individual loans within each program

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TABLE III

OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

The following tables summarizes the operating results of our Sponsors' prior programs that have had offerings close during the five year period ended December 31, 2016. For these programs, the tables reflect the income or loss of the programs (based on U.S. generally accepted accounting principles ("GAAP")); the cash generated from operations, sales and refinancings.

Operating Results	2012	2013	2014	2015	2016
Income
Income – Interest Payments	$172,574	$733,337	$2,054,695	$3,575,084	$3,688,942
Capital Gain/Loss from proceeds of sale	$10,352	$44,504	$251,157	$185,763	($760,963)
Gross Income	$182,926	$777,840	$2,305,851	$3,760,847	$2,927,980
Expenses
Management Fees(1)	$9,432	$14,219	$15,635	$41,138	$57,261
Other Expenses (2)	$3,513	$59,826	$54,877	$59,072	$99,080
Total Expenses (3)	$12,945	$74,045	$70,512	$100,210	$156,341
Summary Statements of Cash Flows
Cash flows provided by operating activities	$182,926	$777,840	$2,305,851	$3,760,847	$2,927,980
Amount and Source of Distributions
Cash distributions paid to investors	$168,735	$589,024	$1,802,052	$2,761,436	$2,101,439
Source of Distributions (per $1,000 invested)
Income provided by operating activities (4)	$119.67	$96.38	$105.99	$94.55	$68.01

⁽¹⁾These figures do not include loan origination or other fees that were paid directly by the borrower to the Manager as these payments were not made out of investment funds.

⁽²⁾ Includes loan servicing and related costs, due diligence, property costs, maintenance, legal and other professional fees.

 ⁽³⁾ Includes acquisition fees, property and asset management fees, disposition fees, financing fees, and other ancillary services. A portion of these fees are used to reimburse costs incurred by the Sponsor. These figures do not include loan origination or other fees that were paid directly by the borrower to the Manager as these payments were not made out of investment funds.

 ⁽⁴⁾ These figures represent the distribution to investors per $1000 of the weighted average of the investment capital raised during the period.

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TABLE IV

OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

The following tables summarizes the operating results of the prior programs of our Sponsors during the five year period ended December 31, 2016. There were no operations for our Sponsors prior to the period January 2012.

Date Closed	Dec 2012	Dec 2013	Dec 2014	Dec 2015	Dec 2016
Aggregate Dollar Amount Raised	$3,523,158	$7,394,594	$17,205,840	$13,934,667	$10,579,657
Duration of Program (Months) (1)	18	18	18	18	18
Total Compensation Paid to Sponsor (2)	$9,432	$14,219	$15,635	$41,138	$57,261
Initial Leverage (3)	NIL	NIL	NIL	NIL	NIL
Annualized Return on Investment (4)	13.06%	12.99%	14.48%	15.28%	10.28%

(1) This figure denotes the average duration of the individual loans within each program.

(2) Includes acquisition fees, property and asset management fees, disposition fees, financing fees, and other ancillary services. A portion of these fees are used to reimburse costs incurred by the Sponsor. These figures do not include loan origination or other fees that were paid directly by the borrower to the Manager as these payments were not made out of investment funds.

(3) No leverage was used within these programs.

(4) Annualized return on investment is the internal rate of return over the program period using the respective cash flows from invested capital, distributions received, and proceeds from sale. See 'Methodology for calculating Investor Returns above on page 84 for further details on the methodology used to calculate investor returns.

Methodology for calculating Investor Returns

We calculated the returns for Prior Programs using a Weighted Average Effective Annual Rate of Return approach which followed the following steps.

1. Holding period returns for each of the loan in the portfolio were calculated using the following formula:

a. (Accrued Interest Income* plus gain or minus loss on redemption**) / Total Loan Amount

* Accrued interest takes into account regular stream of income in each year depending upon the agreed interest rate at issuance of the loan. Accrued interest is based on following formula:

(Amount funded X Annual Interest Rate X Days Loan Outstanding In That Year ***) / 360

** Since some our real estate mortgage loans also require the borrower to share a portion of profits with the servicing manager at the time of selling the property, we have calculated a redemption gain / loss at the maturity of the loan. Redemption gain or loss takes into account the difference between the accrued interest amount and actual payments made by borrower. Redemption gain / loss also captures any bad debts and portion of profits from sale of the property.

*** Days Loan Outstanding, is based on the difference between the loan origination date and loan redemption date if the loan was originated and closed out in the same year. For loans which were originated in a previous year and closed in the year of calculations the loan days are based on the difference between year start date and close out date. For the loans which are originated prior to the start of calculations year while redeemed after the calculations year the loan days are equal to 360. We believe that this methodology presents a better measure in terms of transparency of reporting. Applying this methodology, any unrealized profits from sales of property are not recognized unless they are actually received in cash and are realized.

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2. Each Holding Period Return (HPR) is then annualized using Effective Annual Rate (EAR) Formula:

EAR = (1+HPR)^(360/ Days Loan Outstanding In That Year)

Each EAR is weighted based on the weight of the loan in the complete loan portfolio. Weights are based on original loan amount issued to each borrower.

Sum of the weighted average individual EARs constitutes the total Weighted Average Effective Annual Rate for the portfolio.

Liquidity of Prior Programs

Our Sponsors have not offered prior programs or REITs in which disclosed in the offering materials was a date or time period at which the program or REIT might be liquidated.

Prior Adverse Business Developments

The principals of the Managing Member and the Investment Manager have previously made investments similar to those planned for the Company.  Some of these projects have experienced adverse business developments, including schedule delays, cost overruns, sales prices lower than the appraised values, and foreclosure by first lenders.  Though the principals of the Managing Member and the Investment Manager have taken steps to mitigate these issues with regards to Company investments, there is no guarantee that these developments will not occur again.  If these adverse business developments were to occur, the effect could be reduced profitability or possibly even loss of principal

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COMPENSATION TO MANAGER AND AFFILIATES

We have not paid any compensation to our Managing Member.  Upon capitalization, out Managing Member and its Affiliates will receive fees and expense reimbursements for services relating to the investment and management of our assets. The items of compensation which the Managing Member and Investment Manager may receive in connection with the operation of the Company are summarized in the following table. Neither our Managing Member , Investment Manager nor their Affiliates will receive any selling commissions, placement agent fees or other compensation in connection with the offer and sale of our Class A Units.  Furthermore, no fees, or commissions will be paid to the Managing Member, Investment Manager or their Affiliates in connection with the purchase or sale of Class A Units.

Form of Compensation	Estimated Amounts	Description of Compensation or Method of Determination	Recipient
ORGANIZATIONAL STAGE FEES
ORGANIZATIONAL AND OFFERING EXPENSES	$150,000	To date, our Managing Member has paid organization and offering expenses on our behalf.  We will reimburse our Managing Member for these costs and future organization and offering costs it may incur on our behalf.  To date, we have incurred approximately $105,000. We expect organization and offering expenses to be approximately $150,000.	Managing Member.
MANAGEMENT FEES AND PROFIT SHARING- OPERATIONAL STAGE FEES
MANAGEMENT FEE	2% of capital contributions.	The Managing Member shall be entitled to a management fee in an annual amount of two-percent (2%) of the total capital contributions, payable monthly.  Assuming the sale of the minimum amount of Class A Units, the Managing Member would be entitled to a management fee in the amount of $6,100 . Assuming the sale of the maximum amount of Class A Units and $150,000 of organisational and offering expenses , the Managing Member/ Investment Advisor would be entitled to a management fee in the amount of $897,000 . The Managing Member may direct all, or a portion of the profits to the Investment Manager.	Managing Member and Investment Manager.

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PROFIT SHARE	20% of net profits	he Managing Member shall be entitled to receive twenty percent (20%) of the Company's net profits after the payment of the Preferred Return payable in quarterly distributions.
ASSET RELATED- OPERATIONAL STAGE FEES
LOAN ARRANGEMENT   AND FUNDING FEES	2-5% of the loan amounts	Loan arrangement or fund fees are collected from the borrowers. Such fees average between two and five percent (2-5%) of the total loan amount depending on market conditions. Loan arrangement fees are Company income and are shared by the Class A Unit holders and the Managing Member in accordance with the allocation of net income.  For example, in connection with the arrangement and funding of a Loan in the amount of $100,000.00, the Company would receive $2,000-$5,000 from the borrower.  This amount would be considered income of the Company and would be disbursed in accordance with the operating agreement, 80% to the holders of the Class A and 20% to the Managing Member as the holder of the Class B Units (or the Investment Manager pursuant to the Investment Management Agreement)	All loan origination fees will be shared between the Managing Member, as the holder of the Class B Units and the holders of the Class A Units.  The Managing Member's portion will constitute compensation to the Managing Member.
LOAN EXTENSION AND MODIFICATION FEES	1-3% of loan amount	Loan extension and modification fees are collected from borrowers and payable to the Company.  Such fees are typically between one and three percent (1-3%) of the original loan amount, but could be higher or lower depending on market rates and conditions.  Such fees collected by the Managing Member on the Company's behalf and are not considered a part of the Managing Member's direct compensation, as such fees are payable only to the Company and are shared by the Class A Unit holders and the Managing Member as the Class B Unit holder.  For example, in connection with extension of a Loan in the amount of $100,000.00, the Company would receive $1,000-$3,000 from the borrower.  This amount would be considered income of the Company and would be disbursed in accordance with the 80% to the holders of the Class A and 20% to the Managing Member as the holder of the Class B Units (or the Investment Manager pursuant to the Investment Management Agreement)	Such fees collected by the Managing Member for the benefit of the Company's and are considered Company income, which are shared between the Managing Member as the holder of the Class B Units and the holders of the Class A Units.

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LOAN PROCESSING, LOAN DOCUMENTATION AND OTHER SIMILAR FEES	Loan processing, documentation and other similar fees are collected from the borrower at the time of the loan funding and payable to the Company or its broker or loan servicing company at prevailing industry rates.  These fees are typically between $500-$1,000.	Such fees collected by the Managing Member are collected on the Company's behalf and are not considered a part of the Managing Member's direct compensation, as such fees are payable only to the Company.  These fees are considered Company income, which are shared between the Managing Member as the holder of the Class B Units and the holders of the Class A Units as described in the Operating Agreement.
OTHER LOAN FEES	The Company will earn other loan fees as follows: One Hundred Percent (100%) of its pro-rata share of the following fees paid by borrowers on account of Loans: (i) all late fees incurred by borrowers on defaulted loans; (ii) all default interest incurred by borrowers on defaulted loans (default interest means the amount of interest charged upon a default being declared that is above the contract interest rate); (iii) all forbearance, extension and other fees incurred by borrowers; (iv) all prepayment penalties incurred by borrowers; (v) all pro-rata contingent interest and/or exit fees.  These amounts would be considered income of the Company and would be disbursed 80% to the holders of the Class A and 20% to the Managing Member as the holder of the Class B Units (or the Investment Manager pursuant to the Investment Management Agreement)	Such fees collected by the Managing Member are collected on the Company's behalf and are not considered a part of the Managing Member's direct compensation, as such fees are payable only to the Company.  These fees are considered Company income, which are shared between the Managing Member as the holder of the Class B Units and the holders of the Class A Units as described in the Operating Agreement.

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PURCHASE OF EXISTING LOANS	Between 1% and 5% of the loan amount.	When the Company purchases an existing loan (or pool of loans) from a third party, one or more brokers or sellers may receive a commission.  Such persons may include affiliates of the Managing Member, the Investment Manager or their principals.  The Managing Member will not be paid any fees in connection with such sale.	Brokers and seller, which may include Affiliates of the Managing Member, Investment Manager or their principals.
REAL ESTATE COMMISSIONS	3-10% of disposition proceeds.	Third parties, including Affiliates of the Managing Member and Investment Manager may earn real estate commissions to list and sell real estate that the Company has acquired through foreclosure. Such fees shall be at market rates and shall not exceed 10% of the total proceeds received upon asset disposition and are paid at the time of the asset disposition.	Third parties, including Affiliates of the Managing Member.
PROJECT MANAGEMENT FEES	1-10% of disposition proceeds.	The Company or Affiliates of the Managing Member or Investment Manager may earn project management fees. Such fees shall be at market rates and shall not exceed 10% of the total proceeds received upon asset disposition and are paid at the time of the asset disposition.	The Company or Affiliates of the Managing Member

The Company does not intend to reimburse the Managing Member for the salaries and benefits to be paid to its named executive officers.  Any payments made to executive officers will be made in the form of distributions based upon management fees and profit share received by the Managing Member.

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FIDUCIARY RESPONSIBILITY OF THE MANAGING MEMBER

The Company has not been separately represented by independent legal counsel in its formation or in the dealings with the Managing Member, and members must rely on the good faith and integrity of the Managing Member to act in accordance with the terms and conditions of this Offering.

Duties owed to us and our members by ourManaging Memberare prescribed by law and our Operating Agreement ("Operating Agreement"). The Delaware LLC Act, with the stated purpose of giving the maximum effect to the principle of freedom of contract and to the enforceability of limited liability company agreements, provides that Delaware limited liability companies may, in their Operating Agreements, limit or eliminate any and all liabilities for breach of contract and breach of duties (including fiduciary duties) of a member, manager or other person to a limited liability company or to another member or manager or to another person that is a party to or is otherwise bound by a limited liability company agreement.

Our Operating Agreement will provide that our Managing Member and its principals and affiliates and any other person eligible for indemnification under the terms of our Operating Agreement do not have any duties or liabilities, including fiduciary duties, to the fullest extent permitted by law, to the Company, any member or any other person bound by our Operating Agreement. The provisions of our Operating Agreement, to the extent that they restrict or otherwise modify or eliminate the duties and liabilities, including fiduciary duties, of Managing Member, its principals and affiliates and any other indemnified person existing at law or in equity, will be deemed agreed by the members to replace such other duties and liabilities of the Managing Member or any of its principals or affiliates and any other indemnified person. Therefore, Members may have a more limited right of action than they would have absent these provisions in the Operating Agreement. A successful indemnification of the Managing Member or Investment Manager or any litigation that may arise in connection with the Managing Member's or Investment Manager's indemnification could deplete the assets of the Company. We have agreed to provide indemnification only if the indemnified person did not act in bad faith or engage in fraud, willful misconduct or, in the case of a criminal matter, acted without knowledge that the indemnified person's conduct was unlawful. Thus, the persons identified above could be indemnified for their negligent acts if they met the requirements set forth above.

The Operating Agreement provides that neither the Managing Member nor the Investment Manager will have any liability to the Company for losses resulting from errors in judgment or other acts or omissions unless the Managing Member is guilty of fraud, bad faith or willful misconduct.

It is the position of the U.S. Securities and Exchange Commission that indemnification for liabilities arising from, or out of, a violation of federal securities law is void as contrary to public policy. However, indemnification will be available for settlements and related expenses of lawsuits alleging securities law violations if a court approves the settlement and indemnification, and also for expenses incurred in successfully defending such lawsuits if a court approves such indemnification.

We will adopt provisions to allow the Managing Member, its principals or each of their respective affiliates to engage in transactions with us that would otherwise be prohibited by state-law fiduciary duty standards and to take into account the interests of other parties in addition to our interests when resolving conflicts of interest. Without these modifications, our Managing Directors ability to make decisions involving conflicts of interest would be restricted. These modifications are detrimental to our members because they restrict the remedies available to our members for actions that without those limitations might constitute breaches of duty, including a fiduciary duty, as described below, and they permit the Managing Member and its affiliates to take into account the interests of third parties in addition to our interests when resolving conflicts of interest. By subscribing to and holding our Class A Units, each member will automatically agree to be bound by the provisions in our Operating Agreement, including the provisions described above. This is in accordance with the policy of the Delaware LLC Act favoring the principle of freedom of contract and the enforceability of Operating Agreements. The failure of a member to sign our Operating Agreement does not render our Operating Agreement unenforceable against that person. Further, our Operating Agreement states that, by purchasing our Class A Units, each member automatically approves the existence of the conflicts of interest described in this prospectus, and agrees that they shall not constitute a breach of the Operating Agreement or of any duty otherwise existing at law, in equity or otherwise.

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OWNERSHIP OF PRINCIPAL MEMBERS

The following table sets forth, as June 30, 2016, information with respect to the beneficial ownership of our membership interest units before and after giving effect to this offering for (a) each person who is expected to be the beneficial owner of more than 5% of the outstanding units immediately following the completion of this offering, (b) our directors, director nominees and named executive officers and (c) our directors, director nominees and executive officers as a group. Beneficial ownership is determined according to the rules of the SEC and generally means that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power of that security, including options that are currently exercisable or exercisable within, or restricted units that will vest on or within, 60 days of June 30, 2016. The information does not necessarily indicate beneficial ownership for any other purpose, including for purposes of Sections 13(d) and 13(g) of the Exchange Act. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons named in the table below have sole voting and investment power with respect to all units shown that they beneficially own, subject to community property laws, where applicable. Unless otherwise indicated, the address of each named person is c/o 1999 South Bascom Avenue, 7^th Floor , Campbell, CA 95008.

	Pro Forma Shares of the Company BeneficiallyOwned After the Offering(1)(2)
	Class A Units		Class B Units
Name of Beneficial Owner	Number of Units	Percent of Units	Number of Units	Percent of Units	Percent Total Voting Power
Beneficial owners of more than 5% of our outstanding shares:
SREIF MANAGER II, LLC(3)	—	—	100	100%		100%
Manager, manager nominees and named executive officers:
Thomas Braegelmann(4) (5)(6)	0	0%	20	20%		20%
Charles Tralka(4) (6)(7)	0	0%	20	20%		20%
Matthew Sullivan(4) (6)(8)	0	0%	40	40%		40%
Jordan Goodman(4)(6)(9)	0	0%	20	20%		20%
All directors, director nominees and executive officers as a group (4 persons)	0	0%	100	100%		100%

(1)	Assumes none of our Class A Units and 100 Class B Unit are outstanding immediately following this offering. The table does not reflect any shares that our directors and executive officers may purchase in this offering.
(2)	SREIF Manager II, LLC owns 100% of our Class B Units, which Units are non-voting Units.
(3) (4) (5) (6) (7) (8) (9)	The address of SREIF Manager II, LLC is 1999 South Bascom Avenue, 7th Floor, Campbell, CA 95008. The address of each Manager and named executive officer is 1999 South Bascom Avenue, 7th Floor, Campbell, CA 95008. Units owned by Thomas Braegelmann are owned through GCA Equity Partners, LLC.  Mr. Braegelmann is a principal of GCA Equity Partners, LLC and owns 60% of the membership interests in such entity. Denotes beneficial ownership as members of SREIF Manager II, LLC Units owned by Charles Tralka are owned through GCA Equity Partners, LLC.  Mr. Tralka is a principal of GCA Equity Partners, LLC and owns 40% of the membership interests in such entity. Units owned by Matthew Sullivan are owned through Crowdventure, LLC.  Mr. Sullivan is a principal of Crowdventure, LLC and owns 51% of the membership interests in such entity. The remaining 49% of the interest in Crowdventure, LLC are owned by Mark Read. Units owned by Jordan Goodman are owned through Amherst Enterprises Ltd.  Mr. Goodman is a principal and sole owner of Amherst Enterprises Ltd.

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RELATED PERSON TRANSACTIONS AND CONFLICTS OF INTEREST

Related Person Transactions

This section summarizes material agreements between us and certain related parties.  Additional or modified agreements, arrangements and transactions, which would be negotiated at arm's-length, may be entered into between us and related parties. These summaries are qualified in their entirety by reference to the full text of the applicable agreements, which are filed as exhibits to the Offering Statement, and are incorporated herein by reference.

On the date of this Offering Circular, our Managing Member and its principals will receive material benefits, including those set forth below.

●Organization Equity. The Managing Member, and accordingly the principals of the Managing Member, received 100 (100%) of the Class B Units in the Company.

● Indemnification Agreement. We have entered into indemnification agreements with our Managing Members and its principals, providing for procedures for indemnification and advancements by us of certain expenses and costs by us to the fullest extent permitted by law relating to claims, suits or proceedings arising from their service to us or, at our request, service to other entities, as an officer or director, as described under "Limited Liability and Indemnification of our Managing Member and Others."

Investment Management Agreement

Prior to the initial closing of this offering, we will enter into the Investment Management Agreement with the Investment Manager. The Investment Manager is affiliated with GSCM and is owned by Titan Holding Group, Inc.d.b.a Good Steward Financial Services Group ("Titan Holding Group").   Titan Holding Group is owned by Robert Barr and Mr. Barr has conducted business with the principals of the Managing Member in the past, including with regards to the management of GCA.  Under the Investment Management Agreement, the Investment Manager may receive compensation from the Managing Member in the form of the management fee and profit sharing. For more information on the fees payable to our Manager and its affiliates, please see "Compensation to Our Manager and Affiliates."

We will pay our Managing Member an annual asset management fee equal to 2.0% of our capital contributions payable monthly in arrears in cash.  Assuming that we raise the maximum offering amount, we anticipate we will receive $44,350,000 in net proceeds from this offering. As a result, we estimate that our Managing Member would receive an annual asset management fee of $887,000 if we were to raise no additional equity and no additional adjustments were made.  Of this amount, a portion may be paid to the Investment Manager pursuant to the Investment Management Agreement.

Servicing Agreement

We have entered into a Servicing Agreement with Good Steward Account Servicing, Inc ("GSAS").  GSAS is owned by Titan Holding Group.  GSAS will receive a servicing fee based on the unpaid balance of a Loan.

Project Management Agreements

We may enter into project management agreements for certain assets of the Company with one or more Affiliates of the Managing Member or Investment Manager.  We expect to enter into project management agreements on substantially the same terms. Under the property management agreements, Affiliates of our Managing Member or Investment Manager, may receive compensation in the form of project management fees. For more information on the fees payable to our Manager and its affiliates, please see "Compensation to Our Manager and Affiliates."

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We anticipate that the project manager will manage some of our Company's portfolio earning market-standard project management fees based on a percentage of the disposition proceeds received upon the sale of an asset.  We cannot estimate the project management fees that will be payable to the project manager at this time.

Conflicts of Interest

We are subject to various conflicts of interest arising out of our relationship with our Managing Member, Investment Manager and its affiliates. We discuss these conflicts below and conclude this section with a discussion of the corporate governance measures we have adopted to mitigate some of the risks posed by these conflicts.

Lending , Renewal and Forbearance Fees

The Investment Manager, with the input of the Managing Member and/or its affiliates, will have the sole and absolute discretion to determine whether or not to make, acquire or sell a particular Loan. None of the compensation for the Investment Manager or Managing Member set forth under "Managing Member's Compensation" was determined through arms-length negotiations. Any increase in such charges may have a direct, adverse effect upon the interest rates that borrowers will be willing to pay the Company, thus may reduce the overall rate of your return. Conversely, if the Company reduces the loan fees charged, a higher rate of return might be obtained for the Company and the members. This conflict of interest will exist in connection with every transaction in which the Company participates.

Company Management Not Required to Devote Full-Time

Neither the Managing Member nor Investment Manager is required to devote its capacities full-time to the Company's affairs.  The Managing Member and Investment Manager must only devote such time as the affairs of the Company may reasonably require.

Competition with Affiliates of the Company

Though they currently have no intention to do so, there is no restriction preventing the Company or any of its affiliates, principals or management from competing with the Company by investing in collateral liens or sponsoring the formation of other investment groups like the Company to invest in similar areas. If the Company, the Managing Member, the Investment Manager or any of their principals were to do so, then when considering each new investment opportunity, such person would need to decide whether to originate or hold the resulting transaction in the Company, as an individual or in a competing entity. This situation would compel the Managing Member and Investment Manager to make decisions that may at times favor persons other than the Company. The Operating Agreement exonerates the Company, the Managing Member, the Investment Manager and their affiliates, principals and management from any liability for investment opportunities given to other persons.

Loan Servicing by the Company, Managing Member, Investment Manager or Affiliates

The Managing Member has reserved the right to retain other firms in addition to, or in lieu of, the Company or Managing Member acting as the loan servicer to perform various brokerage services, loan servicing and other activities in connection with the Company's investment portfolio that are described in this Offering Circular, including Good Steward Account Servicing, Inc ("GSAS").  GSAS and such other firms may or may not be affiliated with the Company or Managing Member. Loan servicing firms not affiliated with the Company or Managing Member may provide comparable services on terms more favorable to the Company. The Managing Member has very wide discretion in determining which entity (including, but not limited to, the Managing Member itself, an affiliate of the Managing Member, or an unaffiliated third party) will service the loans.

Other Companies & Partnerships or Businesses

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The Managing Member, Investment Manager and their respective principals, directors, officers or Affiliates may engage, for their own account or for the account of others, in other business ventures similar to that of the Company, including, but not limited to Secured Real Estate Income Fund I, LLC, a Delaware limited liability company ("SREIF I") and GCA California Real Estate Fund, LLC, a California limited liability company ("CARE Fund") with investment strategies which are similar to those of the Company, and neither the Company nor any member shall be entitled to any interest therein. As such, there exists a conflict of interest on the part of the Managing Member because there may be a financial incentive for the Managing Member and Investment Manager to invest in, arrange or originate transactions for SREIF I, CARE Fund , private investors and other mortgage funds. Further, the Managing Member, Investment Manager and their principals, directors, officers and Affiliates may be involved in creating additional mortgage or real estate funds that may compete with the Company. The Managing Member expects that it will establish and sponsor additional investment vehicles in the future that will originate, acquire or invest in real estate loans, real estate and other real estate-related assets. SREIF, CARE Fund and any additional investment vehicles may have investment criteria that compete with the Company. If a sale, financing, investment or other business opportunity would be suitable for more than one of these investment vehicles, the Investment Manager will allocate such opportunities between the Company, SREIF I, CARE Fund and such other entities using its business judgment. Any allocation of this type may involve the consideration of a number of factors that our Investment Manager determines to be relevant, including:

· the investment objectives and criteria of the Company, SREIF I, CARE Fund and the other investment vehicles;

· the cash position of the Company, SREIF I, CARE Fund and the other investment vehicles;

· the effect of the investment on the diversification the Company, SREIF I, CARE Fund or the other investment vehicle's portfolio by type of investment, and risk of investment;

· the anticipated cash flow of the asset to be acquired;

· the income tax effects of the purchase;

· the size of the investment; and

· the amount of funds available.

The Company will not have independent management and it will rely on the Managing Member, the Investment Manager and their respective managers, principals, directors, officers and/or affiliates for the operation of the Company. The Managing Member, Investment Manager and these individuals/entities will devote only so much time to the business of the Company as is reasonably required. The Managing Member, Investment Manager and their managers, principals, directors, officers and/or affiliates may have conflicts of interest in allocating management time, services and functions between various existing companies, and business ventures in they may be or become involved with. Each of the Managing Member and the Investment Manager believes it has sufficient staff to be fully capable of discharging its responsibilities.

Purchase, Sale and/or Hypothecation of Loans

The Managing Members, the Investment Manager, Affiliates and their respective principals, directors and/or officers may sell, buy or hypothecate loans (use loans as collateral for another loan) to the Company, provided that such loans meet the then-existing underwriting criteria of the Company. The Company may pay a price greater or less than the remaining balance on such loans. The price at which existing loans are bought and sold is normally a function of prevailing interest rates and the term of the loan. Therefore, the Company or its Managing Members, Investment Manager and their respective principals, directors, officers and/or affiliates, may make a profit on the sale of an existing loan from the Company or to the Company. There will be no independent review of the value of such loans or of compliance with the conditions set forth above.

Project Management Fees

The Managing Member or its Affiliates may receive project management fees or other compensation related to the administration and management of certain Company investments. In particular, the Managing Member or its Affiliates may receive payment for services related to construction loans and other Loans made by the Company which require administration as well as real estate projects in which the Company invests. These fees shall be at market rates and paid in good faith directly by the borrower or sponsor.

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Lack of Independent Legal Representation

Investors and the Company have not been represented by independent legal counsel to date. The use of the Managing Member's counsel in the preparation of this Offering Circular and the organization of the Company may result in a lack of independent review. Investors are encouraged to consult with their own attorney for legal advice in connection with this Offering. Also, since legal counsel for the Managing Member prepared this Offering, legal counsel will not represent the interests of the members at any time.
 

Conflict with Related Programs

The Managing Member and its members, managers, principals, directors, officers and/or affiliates may cause the Company to join with other entities organized by the Managing Member for similar purposes as partners, joint venturers or co-owners under some form of ownership in certain loans or in the ownership of repossessed real property. The interests of the Company and those of such other entities may conflict, and the Company controlling or influencing all such entities may not be able to resolve such conflicts in a manner that serves the best interests of the Company.

Sale of Real Estate to Affiliates

In the event the Company becomes the owner of any real property by reason of foreclosure on Loan, the first priority of the Managing Member and Investment Manager will be to arrange for the sale of the property for a price that will permit the Company to recover the full amount of its invested capital plus accrued but unpaid interest and other charges, or so much thereof as can reasonably be obtained in light of current market conditions. In order to facilitate such a sale the Managing Member may, but is not required to, arrange a sale to persons or entities controlled by it, (e.g. to another limited liability Company formed by the Managing Member for the express purpose of acquiring foreclosure properties from lenders such as the Company). The Managing Member, the officers of the Managing Member and the Sponsors will be subject to conflicts of interest in arranging such sales since it will represent both parties to the transaction. For example, the Company and the potential buyer will have conflicting interests in determining the purchase price and other terms and conditions of sale. The Managing Member's decision will not be subject to review by any outside parties. The Company may sell a foreclosed property to the Managing Member or an Affiliate at a price that is fair and reasonable for all parties, but no assurance can be given that the Company could not obtain a better price from an independent third party.

The Managing Member shall attempt to resolve these conflicts by setting a purchase price for each loan which is not less than any of the following: (i) the outstanding value (unpaid interest, points, and principal) of such loan, if any, at the time of sale; (ii) the amount of any third party offer already received, if any; or (iii) the total amount of the Company's investment in the loan. The Company's investment is deemed to include without limitation the following: the loan amount, expenditures made to protect the Company's interest in the loan, all costs associated with management, any sales commissions, and any advances made by or on behalf of the Company for any of the foregoing.

Receipt of Fees and Other Compensation by our Managing Member, Investment Manager and their Affiliates

Our Managing Member, Investment Manager and their Affiliates will receive substantial fees from us, which fees will not be negotiated at arm's length. These fees could influence the advice of our Managing Member or Investment Manager to us as well as the judgment of affiliates of our Managing Member or Investment Manager , some of whom also serve as our Managing Member's officers and directors and the key real estate and debt finance professionals of our sponsor. Among other matters, these compensation arrangements could affect their judgment with respect to:

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· the continuation, renewal or enforcement of provisions in our Operating Agreement involving our Managing Member, Investment Manager and their affiliates, or the shared services agreement between our Managing Member and our sponsor;

· public offerings of equity by us, which will likely entitle our Managing Member and Investment Manager to increased funding fees, asset management fees and other fees;

· acquisitions of investments and originations of Loans at higher purchase prices, which entitle our Managing Member, Investment Manager or their affiliates to higher funding fees and asset management fees regardless of the quality or performance of the investment or Loan and, in the case of acquisitions of investments from related entities, might entitle affiliates of our Managing Member or Investment Manager to disposition fees in connection with services for the seller;

· borrowings up to or in excess of our stated borrowing policy to acquire investments and to originate loans, which borrowings will increase asset management fees payable by us to our Managing Member or Investment Manager;

· whether and when we seek to list our Class A Units on a stock exchange or other trading market;

· whether we seek member approval to internalize our management, which may entail acquiring assets (such as office space, furnishings and technology costs) and the key real estate and debt finance professionals of our sponsor who are performing services for us on behalf of our Managing Member or Investment Manager for consideration that would be negotiated at that time and may result in these real estate and debt finance professionals receiving more compensation from us than they currently receive from our sponsor;

· whether and when we seek to sell the company or its assets; and

· whether and when we merge or consolidate our assets with other companies, including companies affiliated with our Managing Member.

 Other Operating Agreement Provisions Relating to Conflicts of Interest

Our Operating Agreement contains many other restrictions relating to conflicts of interest including the following:

Term of our Managing Member. Our Operating Agreement provides that our Managing Member will serve as our manager for an indefinite term, but that our Managing Member may be removed by us, or may choose to withdraw as manager, under certain circumstances. Our members may remove our Managing Member at any time with 30 days prior written notice for "cause," following the affirmative vote of two-thirds of our members. Unsatisfactory financial performance does not constitute "cause" under the Operating Agreement. Our Managing Member may withdraw as manager if we become required to register as an investment company under the Investment Company Act, with such withdrawal deemed to occur immediately before such event. In the event of the removal of our Managing Member, our Managing Member will cooperate with us and take all reasonable steps to assist in making an orderly transition of the management function. Our Managing Member will determine whether any succeeding manager possesses sufficient qualifications to perform the management function. See "Management—Term and Removal of the Managing Member".

Other Transactions Involving Affiliates. Before engaging in a transaction involving an affiliate, our Managing Member must conclude that all other transactions between us and such affiliate, our Managing Member, any of their officers or directors, or any of their affiliates are fair and reasonable to us and on terms and conditions not less favorable to us than those available from unaffiliated third parties.

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DESCRIPTION OF OUR CLASS A UNITS

The following descriptions of our Class A Units, certain provisions of Delaware law and certain provisions of our Certificate of Formation and Operating Agreement, which will be in effect upon consummation of this offering, are summaries and are qualified by reference to Delaware law, our certificate of formation and our Operating Agreement, copies of which are filed as exhibits to the offering statement of which this offering circular is a part.  See "Where You Can Find More Information."

General

We are a Delaware limited liability company organized on June 15, 2016 under the Delaware Limited Liability Company Act, or Delaware LLC Act, issuing limited liability company interests.  The limited liability company interests in our company will be denominated in Class A Units of limited liability company interests ("Class A Units") and Class B Units ("Class B Units"). The Company has authorized and issued 100 Class B Units, which are held by the Managing Member.  Our Operating Agreement provides that we may issue an unlimited number of Class A Units with the approval of our Managing Member and without member approval.

All of the Class A Units offered by this offering circular will be duly authorized and validly issued.  Upon payment in full of the consideration payable with respect to the Class A Units, as determined by our Managing Member, the holders of such Class A Units will not be liable to us to make any additional capital contributions with respect to such Class A Units (except for the return of distributions under certain circumstances as required by Sections 18-215, 18-607 and 18-804 of the Delaware LLC Act).  Holders of Class A Units have no conversion, exchange, sinking fund or appraisal rights, no pre-emptive rights to subscribe for any securities of our company and no preferential rights to distributions. However, holders of our Class A Units will be eligible to participate in our quarterly redemption plan, as described below in "—Redemptions".

We intend to have a December 31^st fiscal year end. In addition, we intend to elect and qualify to be taxed as a partnership for U.S. federal income tax purposes commencing with our taxable year ended December 31, 2016.

Distributions

To the extent that the Company has net income from its investment activities, the Managing Member will make distributions to the members of an amount equal to an annual preferred return (the "Preferred Return") on their investment, payable each calendar month (and prorated as applicable for the amount of time that a member was a member of the Company during such month). This Preferred Return will be payable only to the extent the Company has net income and prior to any other distributions or profit participation by the Managing Member (however, all expenses and fees (including loan origination fees and Lender Fees) will be paid and deducted from the total income prior to making to any distributions ). The Preferred Return for any member shall be equal to an annualized rate of eight percent (8.00%). The Preferred Return will be calculated and distributed on a monthly basis to the extent such amounts are available for distribution .

Members will also be eligible for regular quarterly income distributions of the Company's Net Income, as follows: Members will be eligible for quarterly income distributions of their pro-rata share of eighty-percent (80%) of the Net Income of the Company according to the member's capital account to the extent cash is available and provided that the quarterly income distribution will not impact the continuing operations of the Company.  "Net Income" means the Company's quarterly gross income less the Company's quarterly operating expenses and an allocation of income for a loan loss reserve. All such distributions will be made on a quarterly basis, in arrears.

Distributions may be made in excess of cash flow, but shall not be in excess of earnings.  Since income is based upon the accrual method, there may situations where the Company makes distributions from its loan loss reserve account in the amount of accrued but unrealized interest income.  Loan loss reserves shall be established between one and five percent (1-5%).

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Each member has the option of having his, her or its share of the earnings of the Company (including any Preferred Return) that is payable to the member credited to his, her or its capital accounts. However, the Managing Member reserves the right to commence making cash distributions at any time to any member(s) in order for the Company to remain exempt from the ERISA plan asset regulations. (See "ERISA Considerations" and "Summary of Operating Agreement" below). In addition, the Managing Member may elect to redeem all or a party of a member's Class A Units for any reason upon thirty (30) days written notice to the member at a price equal to the member's capital contribution plus any accrued but unpaid Preferred Return and other fees which owed to the member on the date of redemption. The Managing Member may also, by notice to a member, force the sale of all or a portion of such member's interest on such terms as the Managing Member determines to be fair and reasonable, or take such other action as it determines to be fair and reasonable in the event that the Managing Member determines or has reason to believe that: (i) such member has attempted to effect a transfer of, or a transfer has occurred with respect to, any portion of such member's interest in violation of the Operating Agreement; (ii) continued ownership of such Class A Units by such member is reasonably likely to cause the Company to be in violation of securities laws of the United States or any other relevant jurisdiction or the rules of any self-regulatory organization applicable to the Managing Member or its affiliates; (iii) continued ownership of such Class A Units by such member may be harmful or injurious to the business or reputation of the Company or the Managing Member, or may subject the Company or any members to a risk of adverse tax or other fiscal consequence, including without limitation, adverse consequence under ERISA; (iv) any of the representations or warranties made by such member in connection with the acquisition of such member's interest was not true when made or has ceased to be true; or (v) such member's Interest has vested in any other person by reason of the bankruptcy, dissolution, incompetency or death of such member.

Members shall receive cash distributions of net income in the form of quarterly distributions and monthly Preferred Returns unless a member elects to have all amount such amounts be credit to such member's capital account . An election to not receive quarterly or monthly distributions is revocable at any time upon a written request to revoke such election. Members may change their election at any time upon thirty (30) days written notice to the Company. Upon receipt and after the thirty (30) day notice has occurred, the member's election shall be changed and reflected on the following first day of the successive period in which the member is entitled to receive a distribution. Notwithstanding the preceding sentences, the Managing Member may at any time immediately commence with income distributions in cash only (hence, suspending the reinvestment option for such member(s) to any member(s) in order for the Company to remain exempt from the ERISA plan asset regulations. (See "ERISA Considerations" and "Summary of Operating Agreement" below)

Prospective investors should understand that earnings, cash flow and distributions of the Company may necessarily fluctuate in accordance with the business and operations of the Company. At the end of each calendar quarter, the Managing Member will (as soon as reasonably practicable) review distributions paid during the prior quarter (i.e. the quarter prior to the quarter just ended) and make ratable adjustments to the income distributions and Preferred Return distributions paid or payable to members in order to ensure that members receive accurate income and Preferred Return distributions.

The Managing Member may (but shall not be required to) make distributions, as cash advances against regular distributions, to the members to the extent of available cash in amounts sufficient to satisfy the member income tax liability with respect to their allocated portion of the applicable Company's taxable net income, less any amounts previously distributed in such tax year.

The Managing Member may invest some of the Company's assets in short-term obligations of the United States government or other governments, certificates of deposit, commercial paper and other money market instruments, until capital contributions are invested in projects consistent with the Company's investment strategy or used to pay Company Expenses. Income generated from such investments is not subject to the mandatory distribution provisions of the Operating Agreement.

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Although our goal is to fund the payment of distributions solely from cash flow from operations, we may pay distributions from other sources, including the net proceeds of this offering, cash advances by our Managing Member, cash resulting from a waiver of fees or reimbursements due to our Managing Member, borrowings in anticipation of future operating cash flow and the issuance of additional securities, and we have no limit on the amounts we may pay from such other sources. If we fund distributions from financings or the net proceeds from this offering, we will have less funds available for investment in real estate properties, real estate-related assets and other investments. We expect that our cash flow from operations available for distribution will be lower in the initial stages of this offering until we have raised significant capital and made substantial investments. Further, because we may receive income at various times during our fiscal year and because we may need cash flow from operations during a particular period to fund expenses, we expect that during the early stages of our operations and from time to time thereafter, we may declare distributions in anticipation of cash flow that we expect to receive during a later period and these distributions would be paid in advance of our actual receipt of these funds. In these instances, we expect to look to third party borrowings, our offering proceeds or other sources to fund our distributions. Additionally, we will make certain payments to our Managing Member for services provided to us. See "Management Compensation." Such payments will reduce the amount of cash available for distributions. Finally, payments to fulfill redemption requests under our redemption plan will also reduce funds available for distribution to remaining members.

Our distributions will constitute a return of capital to the extent that they exceed our current and accumulated earnings and profits as determined for U.S. federal income tax purposes. To the extent that a distribution is treated as a return of capital for U.S. federal income tax purposes, it will reduce a holder's adjusted tax basis in the holder's Class A Units, and to the extent that it exceeds the holder's adjusted tax basis will be treated as gain resulting from a sale or exchange of such Class A Units.

Voting Rights

Holders of our Class A Units will have voting rights only with respect to certain matters, as described below.  Each outstanding Class A Unit entitles the holder to one vote on all matters submitted to a vote of Class A Unit holders until the redemption date as described below in "—Redemptions".  Generally, matters to be voted on by our members must be approved by either a majority or supermajority, as the case may be, of the votes cast by all Class A Units present in person or represented by proxy.  If any such vote occurs, you will be bound by the majority or supermajority vote, as applicable, even if you did not vote with the majority or supermajority.

The following circumstances will require the approval of holders representing a majority or supermajority, as the case may be, of the Class A Units:

· any amendment to our Operating Agreement that would adversely change the rights of the Class A Units (majority of affected class);

· removal of our Managing Member as the manager of our company for "cause" as described under "Management—Term and Removal of the Managing Member" (two-thirds); and

· all such other matters as our Managing Member, in its sole discretion, determines will require the approval of members, or as otherwise required by law.

General Procedures

Public Announcements; Notices.  In the case of specified dispositions or a redemption, we will publicly announce or otherwise provide specified information to holders of Class A Units.

Meetings. Our Operating Agreement provides that special meetings of members may only be called by our Managing Member. There will be no annual or regular meetings of the members.

Fractional Shares.  Our Managing Member will not have to issue or deliver any fractional Class A Units to any holder of Class A Units upon any redemption or distribution under the provisions described under "—Redemptions."  Instead of issuing fractional Class A Units, we will pay cash for the fractional share in an amount equal to the fair market value of the fractional share, without interest.

Adjustments for Distributions.  Upon the redemption of any Class A Units, the redemption price will be reduced by the aggregate sum of distributions, if any, declared on the Class A Units subject to the redemption request with record dates during the period between the quarter-end redemption request date and the date of redemption. If a redemption date with respect to Class A Units comes after the record date for the payment of a distribution to be paid on those Class A Units but before the payment or distribution, the registered holders of those Class A Units at the close of business on such record date will be entitled to receive the distribution on the payment date, notwithstanding the redemption of those Class A Units or our default in payment of the distribution.

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Payment of Taxes.  If any person exchanging a certificate representing Class A Units wants us to issue a certificate in a different name than the registered name on the old certificate, that person must pay any transfer or other taxes required by reason of the issuance of the certificate in another name or establish, to the satisfaction of us or our agent, that the tax has been paid or is not applicable.

Liquidation Rights

In the event of a liquidation, termination or winding up of our company, including if we do not raise the $500,000 minimum threshold from third parties, whether voluntary or involuntary, we will first pay or provide for payment of our debts and other liabilities, including the liquidation preferences of any class of preferred Class A Units. Thereafter, holders of our Class A Units will share in our funds remaining for distribution pro rata in accordance with their respective interests in our company.

Class B Units

The Company has authorized and issued one hundred (100) Class B membership interest units ("Class B Units"), which shall be held by the Managing Member. The Class B Units do not have voting rights and is not convertible into Class A Units. As the holder of the Class B Unit, the Managing Member is entitled to receive twenty percent (20%) of the Net Income. The Managing Member shall also have the right to receivean annual management fee in the amount of two percent (2%) of the total capital contributions, payable monthly.

Transfer Agent and Registrar

As of the date of this offering circular, we intend to engage VStock Transfer as transfer agent in order to satisfy the conditional exemption contained in Rule 12g5-1(a)(7) of the Securities Exchange Act of 1934, as amended, or the Exchange Act.

Operating Agreement

Organization and Duration

We were formed on June 15 2016, as Secured Real Estate Income Fund II, LLC, a Delaware limited liability company, and will remain in existence until dissolved in accordance with our Operating Agreement.

Purpose

Under our Operating Agreement, we are permitted to engage in any business activity that lawfully may be conducted by a limited liability company organized under Delaware law and, in connection therewith, to exercise all of the rights and powers conferred upon us pursuant to the agreement relating to such business activity.

Agreement to be Bound by our Operating Agreement; Power of Attorney

By purchasing a Class A Unit, you will be admitted as a member of our company and will be bound by the provisions of, and deemed to be a party to, our Operating Agreement.  Pursuant to this agreement, each member and each person who acquires a Class A Unit from a member grants to our Managing Member a power of attorney to, among other things, execute and file documents required for our qualification, continuance or dissolution.  The power of attorney also grants our Managing Member the authority to make certain amendments to, and to execute and deliver such other documents as may be necessary or appropriate to carry out the provisions or purposes of, our Operating Agreement.

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No Fiduciary Relationship with our Managing Member

We operate under the direction of our Managing Member, which is responsible for directing the management of our business and affairs, managing our day-to-day affairs, and working with the Investment Manager to implement our investment strategy. Our Managing Member performs its duties and responsibilities pursuant to our Operating Agreement. Our Managing Member maintains a contractual, as opposed to a fiduciary relationship, with us and our members. Furthermore, we have agreed to limit the liability of our Managing Member and to indemnify our Managing Member against certain liabilities.

Limited Liability and Indemnification of our Managing Member and Others

Subject to certain limitations, our Operating Agreement limits the liability of our Managing Member, its principals and officers, for monetary damages and provides that we will indemnify and pay or reimburse reasonable expenses in advance of final disposition of a proceeding to our Managing Member, its officers and directors, our sponsor and our sponsor's members and affiliates.

Our Operating Agreement provides that to the fullest extent permitted by applicable law our Managing Member, its officers and principals will not be liable to us.  In addition, pursuant to our Operating Agreement, we have agreed to indemnify our Managing Member, its officers and principals, and the Investment Manager and its members and officers and affiliates, to the fullest extent permitted by law, against all expenses and liabilities (including judgments, fines, penalties, interest, amounts paid in settlement with the approval of the company and attorney's fees and disbursements) arising from the performance of any of their obligations or duties in connection with their service to us or the Operating Agreement, including in connection with any civil, criminal, administrative, investigative or other action, suit or proceeding to which any such person may hereafter be made party by reason of being or having been the manager or one of our Managing Member's principals.

Amendment of Our Operating Agreement; Exclusive Authority of our Managing Member to Amend our Operating Agreement

Amendments to our Operating Agreement may be proposed only by or with the consent of our Managing Member.  Our Managing Member will not be required to seek approval of the members to adopt or approve any amendment to our Operating Agreement, except to the extent that such amendment would limit the rights of the holders of the Class A Units or would otherwise have an adverse effect on such holders. In such a case, the proposed amendment must be approved in writing by holders representing a majority of the Class A Units. 

Termination and Dissolution

We will continue as a limited liability company until terminated under our Operating Agreement.  We will dissolve upon: (1) the election of our Managing Member to dissolve us; (2) the sale, exchange or other disposition of all or substantially all of our assets; (3) the entry of a decree of judicial dissolution of our company; or (4) at any time that we no longer have any members, unless our business is continued in accordance with the Delaware LLC Act.

Books and Reports

We are required to keep appropriate books of our business at our principal offices.  The books will be maintained for both tax and financial reporting purposes on a basis that permits the preparation of financial statements in accordance with GAAP.  For financial reporting purposes and federal income tax purposes, our fiscal year and our tax year are the calendar year.

Determinations by our Managing Member

Any determinations made by our Managing Member under any provision described in our Operating Agreement will be final and binding on our members, except as may otherwise be required by law.  We will prepare a statement of any determination by our Managing Member respecting the fair market value of any properties, assets or securities, and will file the statement with our company secretary.

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Valuation Policies

Our Managing Member will provide valuations of certain real estate assets and investments, including related liabilities, and to adjust those valuations for events known to the Managing Member that it believes are likely to have a material impact on previously provided estimates of the value of the affected real estate assets and investments and related liabilities. Our real estate assets will consist primarily of a diversified portfolio of real estate loans, real estate and other real estate-related assets where the underlying collateral will typically be real estate or security interests therein. We will amortize asset acquisition costs over the duration of the real estate asset. In the instances of assets with uncertain durations, we will amortize asset acquisition costs over five years. Our liabilities will also include accrued fees and operating expenses, accrued distributions payable, accrued management fees and, to the extent we are using margin, trade payables incurred in the ordinary course of business, which will be estimated by our Managing Member.

Until such time as our Class A Units are listed on an exchange, our Managing Member will calculate our NAV per Class A Unit using a process on a quarterly basis beginning March 31, 201 7 that reflects (1) the value of Loans and or notes (as determined by the unpaid principal balance, plus accrued but unpaid interest), (2) the value of real estate assets and investments, including related liabilities provided periodically by the Managing Member or an independent valuation expert in individual appraisal reports of the underlying real estate, as they may be updated upon certain material events described below, (3) accruals of distributions, and (4) estimates of quarterly accruals, on a net basis, of our operating revenues, expenses and fees. An independent valuation expert will not be responsible for, or prepare, ourNAV per Class A Unit. If a material event occurs between scheduled annual valuations that our Managing Member believes may materially affect the value of any of our real estate assets and investments, including related liabilities, our Managing Member will adjust the most recent valuations provided in the applicable appraisal report, if any, to account for the estimated impact. Our Managing Member will determine our NAV per Class A Unit by dividing our NAV in suchmonth by the number of our Class A Units outstanding as of the end of suchmonth, prior to giving effect to any share purchases or redemptions to be effected for such month .

Our goal is to provide a reasonable estimate of the market value of our Class A Units on a quarterly basis. However, the majority of our assets will consist of real estate loans and, as with any real estate valuation protocol, the conclusions reached by our independent valuation expert will be based on a number of judgments, assumptions and opinions about future events that may or may not prove to be correct. The use of different judgments, assumptions or opinions would likely result in different estimates of the value of our real estate assets and investments. In addition, for any given month , our published NAV per Class A Unit may not fully reflect certain material events, to the extent that the financial impact of such events on our portfolio is not immediately quantifiable. As a result, the quarterly calculation of our NAV per Class A Unit may not reflect the precise amount that might be paid for your Class A Units in a market transaction, and any potential disparity in our NAV per Class A Unit may be in favor of either members who redeem their Class A Units, or members who buy new Class A Units, or existing members. However, to the extent quantifiable, if a material event occurs in between quarterly updates of NAV that would cause our NAV per Class A Unit to change by 5% or more from the last disclosed NAV, we will disclose the updated price and the reason for the change in an offering circular supplement as promptly as reasonably practicable, and will update the NAV information provided on our website.

Quarterly NAV Share Price Adjustments

Our Managing Member set our initial offering price at $10.00 per Class A Unit, which will be the purchase price of our Class A Units until March 31, 201 7 . Thereafter, until such time as the Class A Units are listed on a public exchange, the per Class A Unit purchase price will be adjusted quarterly thereafter and will be equal to our NAV divided by the number of Class A Units outstanding as of the close of business on the last business day of the priormonth, in each case prior to giving effect to any share purchases or redemptions to be effected on such day.

Beginning March 31, 201 7 , we will file with the SEC on a quarterly basis an offering circular supplement disclosing the quarterly determination of our NAV per Class A Unit that will be applicable for such month , which we refer to as the pricing supplement. We will disclose, on a quarterly basis in an offering circular supplement filed with the SEC, the principal valuation components of our NAV. In addition, if a material event occurs in between quarterly updates of NAV that would cause our NAV per Class A Unit to change by 5% or more from the last disclosed NAV, we will disclose the updated price and the reason for the change in an offering circular supplement as promptly as reasonably practicable, and will update the NAV information provided on our website.

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Any subscriptions that we receive prior to the end of amonth will be executed at a price equal to our NAV per Class A Unit applicable to such month. Thus, even if settlement occurs in the following quarter , the purchase price for the Class A Units will be the price in effect at the time the subscription was received.

Redemptions

At any time prior to the listing of the Class A Units on the OTCQB and after fifteen months (15) following the purchase of Class A Units, a member may request that the Company redeem all or a portion of its Class A Units by giving the Company 90 days' notice. Based on an assessment of the Company's liquid resources and redemption requests, the Company's Managing Member has the authority, in its sole discretion, to further limit redemptions by each member during any quarter, including if the Managing Member deems such action to be in the best interest of the members.

The redemption price will be based upon the most current NAV. The redemption price will be reduced by the aggregate sum of distributions, if any, declared on the Class A Units subject to the redemption request with record dates during the period between the quarter-end redemption request date and the redemption date.

Redemption of our Class A Units will be made quarterly upon written request to us at least 15 days prior to the end of the applicable quarter. Redemption requests will be honored no more than 90 days following the end of the applicable quarter, which we refer to as the redemption date. Members may withdraw their redemption request at any time up to three business days prior to the redemption date.

Because the Company is not required to make a distribution for up to 90 days following the request and NAV per Class A Unit will be calculated at the end of each quarter beginning on March 31, 201 7 , the redemption price may change between the date we receive the redemption request and the date on which redemption proceeds are paid. As a result, the redemption price that a member will receive may be different from the redemption price on the day the redemption request is made.

We cannot guarantee that the funds set aside for the redemption plan will be sufficient to accommodate all requests made in any quarter. In the event that we do not have sufficient funds available to redeem all of the Class A Units for which redemption requests have been submitted in any quarter, we plan to redeem our Class A Units on a pro rata basis on the redemption date.

We are not obligated to redeem Class A Units. We presently intend to limit the number of Class A Units to be redeemed during any calendar year to 10.0% of the weighted average number of Class A Units outstanding during the prior calendar year (or 2.5% per quarter, with excess capacity carried over to later quarters in the calendar year).

There is no fee in connection with a redemption of our Class A Units unless a redemption request is made prior to 15 months following the purchase of such Class A Units, in which case the Managing Member may, on behalf of the Company, require the redeeming member to pay a redemption fee of ten percent (10%) of the amount of the redemption request. A member requesting redemption will be responsible for reimbursing us for any third-party costs incurred as a result of the redemption request, including but not limited to, bank transaction charges, custody fees, and/or transfer agent charges.  The payment of any redemption fee will be received by the Company and no portion shall be paid to any underwriter or related person.

In addition, the Managing Member may, in its sole discretion, amend, suspend, or terminate the redemption plan at any time without notice, including to protect our operations and our non-redeemed members, to prevent an undue burden on our liquidity, to preserve or facilitate our tax status, following any material decrease in our NAV, or for any other reason. The Managing Member may also, in its sole discretion, decline any particular redemption request if it believes such action is necessary to preserve or facilitate our tax status. Therefore, you may not have the opportunity to make a redemption request prior to any potential termination of our redemption plan.

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The Managing Member may, in its sole discretion, compulsorily redeem up to ten percent (10%) of the outstanding Class A Units during any calendar year for the purpose of stabilizing NAV .  In addition, the Managing Member may elect to redeem all or a part of a member's Class A Units interests for any reason upon thirty (30) days written notice to the member at a price equal to the member's capital contribution plus any accrued but unpaid Preferred Return and other fees which are owed to the member on the date of redemption. The Managing Member may also, by notice to a member, force the sale of all or a portion of such member's interest on such terms as the Managing Member determines to be fair and reasonable, or take such other action as it determines to be fair and reasonable in the event that the Managing Member determines or has reason to believe that: (i) such member has attempted to effect a transfer of, or a transfer has occurred with respect to, any portion of such member's interest in violation of the Operating Agreement; (ii) continued ownership of such Class A Units by such Member is reasonably likely to cause the Company to be in violation of securities laws of the United States or any other relevant jurisdiction or the rules of any self-regulatory organization applicable to the Managing Member or its Affiliates; (iii) continued ownership of such interest by such member may be harmful or injurious to the business or reputation of the Company or the Managing Member, or may subject the Company or any members to a risk of adverse tax or other fiscal consequence, including without limitation, adverse consequence under ERISA; (iv) any of the representations or warranties made by such member in connection with the acquisition of such Member's interest was not true when made or has ceased to be true; or (v) such member's interest has vested in any other person by reason of the bankruptcy, dissolution, incompetency or death of such member.

Reports to Members

Under the Securities Act, we must update this offering circular upon the occurrence of certain events, such as asset acquisitions. We will file updated offering circulars and offering circular supplements with the SEC. We are also subject to the informational reporting requirements of the Exchange Act that are applicable to Tier 2 companies whose securities are registered pursuant to Regulation A, and accordingly, we will file annual reports, semi-annual reports and other information with the SEC. In addition, we will provide you directly with periodic updates, including offering circulars, offering circular supplements, quarterly pricing supplements, quarterly information statements and other information.

We will provide such periodic updates electronically through the Company website at www.securedrealestateincomefunds.com and documents will be provided electronically. You may access and print all periodic updates provided through our website. As periodic updates become available, we will notify you of this by sending you an e-mail message that will include instructions on how to retrieve the periodic updates. If our e-mail notification is returned to us as "undeliverable," we will contact you to obtain your updated e-mail address. We will provide you with paper copies at any time upon request. The contents of the Company website are not incorporated by reference in or otherwise a part of this offering circular.

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U.S. FEDERAL INCOME TAX CONSIDERATIONS

Introduction

The following is a summary of certain material federal income tax consequences of acquiring, holding and disposing of Class A Units. Because the federal income tax consequences of investing in the Company varies from investor to investor depending on each investor's unique federal income tax circumstances, this summary does not attempt to discuss all of the federal income tax consequences of such an investment. Among other things, except in certain limited cases, this summary does not purport to deal with persons in special situations (such as financial institutions, non-U.S. persons, insurance companies, entities exempt from federal income tax, regulated investment companies, dealers in commodities and securities and pass through entities). Further, to the limited extent this summary discusses possible foreign, state and local income tax consequences, it does so in a very general manner. Finally, this summary does not purport to discuss federal tax consequences (such as estate and gift tax consequences) other than those arising under the federal income tax. You are therefore urged to consult your tax advisers to determine the federal, state, local and foreign tax consequences of acquiring, holding and disposing of a Class A Unit.

The following summary is based upon the Code, as well as administrative regulations and rulings and judicial decisions thereunder, as of the date hereof, all of which are subject to change at any time (possibly on a retroactive basis). Accordingly, no assurance can be given that the tax consequences to the Company or its investors will continue to be as described herein.

The Company has not sought or obtained a ruling from the IRS (or any other federal, state, local or foreign governmental agency) as to any specific federal, state, local or foreign tax matter that may affect it. Accordingly, although this summary is considered to be a correct interpretation of applicable law, no assurance can be given that a court or taxing authority will agree with such interpretation, the conclusions reached by Tax Counsel or with the tax positions taken by the Company.

Partnership Status

Based upon representations from us, Tax Counsel has rendered its opinion that, although the issue is not free from doubt, the Company will be initially classified as a partnership, and not as an association taxable as a corporation, for federal income tax purposes. Accordingly, the members, subject to the discussion regarding publicly traded partnerships below, will be partners in such partnership for federal income tax purposes.

A publicly traded partnership (a "PTP") is generally treated as a corporation for federal income tax purposes. If the Company were treated as a PTP, the members would not be treated as partners for federal income tax purposes, and income or loss of the Company would not be passed through to the members. Instead, the Company would be subject to federal income tax on its income at the rates applicable to corporations. The imposition of any such tax would reduce the amount of cash available to be distributed to our members. In addition, distributions from our Company to our members would be ordinary dividend income to such members to the extent of our earnings and profits. Accordingly, status of the Company as a PTP would materially reduce the after-tax return to a member from its investment in the Company.

However, a partnership that otherwise would constitute a PTP taxable as a corporation generally will not be taxable as a corporation under an exception which is applicable if at least 90% of the gross income of the partnership for a taxable year consists of certain categories of income (the "Qualified Income Categories"). The Qualified Income Categories consist of income and gains from the buying and selling of commodities held as capital assets or futures, forwards, or options with respect to such commodities (where such activity is a principal activity of the partnership); dividends; interest (to the extent such interest is neither derived from the "conduct of a financial or insurance business" nor based upon "income or profits" of any person); certain capital gains; gain from the sale or other disposition of real property; income inclusions in respect of a controlled foreign corporation (a "CFC") (at least to the extent such inclusion is matched by a distribution out of earnings and profits in the taxable year of inclusion); income inclusions with respect to a passive foreign investment company (a "PFIC") (at least to the extent of those required income inclusions where the PFIC is treated as a qualified electing fund ("QEF") where such inclusion is matched by a distribution out of earnings and profits in the taxable year of inclusion); and certain other qualifying income.

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In general, the income that the Company receives from its Loans should be expected to fit within one or more of the Qualified Income Categories as either interest or gains from the sale or disposition of real property. However, the interest earned by the Company may only be included within the Qualifying Income Categories if (a) the interest does not depend on the income or profits of any person and (b) the interest is not derived in the conduct of a financial business. We have represented that in future taxable years we anticipate that income described in clause (a) will, together with any other non-qualifying income, constitute less than 10% of the Company's gross income. There is no definitive guidance as to the level of activity that may, for purposes of clause (b), cause us to be treated as if we were engaged in a financial business. There is no assurance that the IRS will not successfully contend that our Company is engaged in a financial business or earns more than 10% of our gross income from such a business and, therefore, is a publicly traded partnership taxable as a corporation. The Managing Member intends to operate the Company in a manner that will comply with the above exception for qualified income. To the extent that such exception is not available, the Company may also rely upon other safe harbors from PTP status provided under Treasury Regulations to the extent available. However, the continued availability of these safe harbors cannot be known at present, and there is no assurance that the Company would qualify under any such safe harbors.

In addition, it is unclear whether or not income received from shared appreciation mortgages fits within one or more of the Qualified Income Categories. We believe the amounts received by the Company in connection with the sale of a property subject to a shared appreciation mortgage represents a gain from the sale or disposition of real property and therefore qualifies within one of the Qualified Income Categories. In the event that such income is deemed to not constitute income within the Qualified Income Categories, then the Company will take such steps as necessary to limit its investment in such instruments to constitute less than 10% of the Company's gross income.

The discussion set forth in the following paragraphs assumes that the Company will be taxed as a partnership (and not a PTP taxable as a corporation) for federal income tax purposes.

Taxation of Members

As a limited liability company, the Company is not itself subject to U.S. federal income tax but will file an annual company information return with the IRS. Each member is required to report separately on his or her income tax return his or her distributive share of the Company's net long-term capital gain or loss, net short-term capital gain or loss, net ordinary income, deductions and credits. The Company may utilize a variety of investment and trading strategies which produce both short-term and long-term capital gain (or loss), as well as ordinary income (or loss). The Company will send annually to each member a Schedule K-1 showing his or her distributive share of the Company items of income, gain, loss deduction or credit.

Each member that is subject to U.S. federal income taxes (a "U.S. Member") will be liable for taxes on its distributive share of Company income regardless of whether the Company has made any distributions to the member.

Allocations of the items of income, gain, loss, deductions and credits of the Company will be made in accordance with the Operating Agreement of the Company. Such allocations are intended to have "substantial economic effect." If an allocation to a member does not have substantial economic effect, such member's distributive share of profit or loss for tax purposes will be determined in accordance with such member's interest in the Company, taking into account all facts and circumstances. Consequently, if the IRS were to successfully challenge the allocations set forth in the Operating Agreement, the member may be allocated different amounts of income, gain, loss, deductions or credits than initially reported to such member.

Upon any redemption of Class A Units of a U.S. Member, the Company may specially allocate separate Company items of income, gain, loss and deduction to a redeeming U.S. Member to the extent necessary such that the U.S. Member would have an adjusted tax basis in its Class A Units equal to the redemption payment. The Managing Member generally retains sole discretion in determining the character of any such items specially allocated to a particular redeeming U.S. Member. Although the Managing Member believes that these special allocations will be respected for federal income tax purposes, there are no assurances that such allocations could not be successfully challenged. If successfully challenged, a member's allocable share of Company taxable income and loss may be affected.

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To the extent that these special allocations are not made, or are made but successfully challenged, for U.S. federal income tax purposes, the U.S. Member would not have an adjusted tax basis in its Class A Units equal to the redemption payment. In that case, cash paid as part of a redemption to a U.S. Member in excess of the adjusted tax basis of its Class A Units will be treated as an amount received on the sale or exchange of its Class A Units and will generally be taxable as capital gain. Further, in that case, a U.S. Member may not recognize a loss upon a partial redemption of its Class A Units or partial withdrawal of its capital in the Company, and may only recognize a loss upon a complete withdrawal or the redemption or termination of its entire Class A Units in the Company after the U.S. Member has received all distributions and payments in respect of such complete withdrawal, redemption, or termination. In such case, the member generally would recognize a capital loss to the extent of any remaining tax basis in its Class A Units.

Any capital gain or loss so recognized by a U.S. Member upon redemption (or upon a distribution, withdrawal, termination or other disposition) of its Class A Units generally would be long-term capital gain or loss to the extent of the portion of the member's Class A Units that are held for more than twelve months, and short-term capital gain or loss to the extent of the portion of the member's Class A Units that is held for twelve months or less. For this purpose, a member would begin a new holding period in a portion of its Class A Units each time it makes an additional investment in the Company. Cash distributed (including with respect to partial withdrawals and partial redemption payments) to a U.S. Member in excess of the adjusted tax basis of its Class A Units will be treated as an amount received on the sale or exchange of its Class A Units and will generally be taxable as capital gain. An in-kind distribution of property other than cash generally will not result in taxable income or loss to any member.

Where the Company makes a distribution that constitutes a "substantial basis reduction" distribution (e.g., the complete redemption of a member's Class A Units where the member recognizes a tax loss in excess of $250,000), the Company is generally required to adjust its tax basis in its assets in respect of all members. (The Company also is required to adjust its tax basis in its assets in respect of a transferee member in the case of a sale or exchange of Class A Units, or a transfer upon death, when there exists "substantial built-in loss" (i.e., in excess of $250,000) in respect of Company property immediately after the transfer.) For this reason, the Company will require (i) a member who receives a distribution from the Company in connection with a complete withdrawal, (ii) a transferee of Class A Units (including a transferee in case of death), and (iii) any other member in appropriate circumstances to provide the Company with information regarding its adjusted tax basis in its Class A Units.

Allocations

Under the Operating Agreement, the Company's net capital appreciation or net capital depreciation for each accounting period is allocated among the members without regard to the amount of income, gain or loss actually recognized by the Company for federal income tax purposes. The Operating Agreement provides that items of the Company's income, gain, loss, deduction and credit actually recognized by the Company during a fiscal year generally are to be allocated for federal income tax purposes among the member pursuant to the principles of Treasury Regulations issued under Sections 704(b) and 704(c) of the Code.

Under these principles, income, gain, loss, deduction and credit are generally allocated among the members as of the end of the Company's taxable year, based upon the amounts of the Company's net capital appreciation or net capital depreciation that have been allocated to such members for the current and prior fiscal years, in a manner designed to eliminate "book/tax disparities" in respect of such member's Class A Units.

Investors are urged to review the Operating Agreement for a more complete description of the manner in which the Company will allocate its income, gain and losses for book and federal income tax purposes.

The IRS could disagree with the Company's methods of allocating income, gain and losses for federal income tax purposes, which could cause members to recognize more or less income, gain or loss than originally allocated to them for federal income tax purposes.

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Income or Loss on Sale of Assets. Generally, the gains and losses realized by the Company on the sale of portfolio assets should be characterized primarily as capital gains or losses, except in respect of loans, to the extent of any accrued market discount not previously included in the income of the Company and any amount realized attributable to accrued but unpaid interest. See "Phantom Income and Related Considerations" below. Generally, capital assets must be held for more than twelve months for the gain from the sale of the capital assets to qualify as long-term capital gains. Gains or losses on sales of capital assets that are held for twelve months or less are treated as short-term gains or losses and are taxed at ordinary income rates. Company income may also include ordinary income, including from interest and rental income.

Under current law, the highest marginal U.S. federal income tax rate applicable to ordinary income of individuals is 39.6% and the highest marginal U.S. federal income tax rate applicable to long-term capital gains (generally, capital gains on certain assets held for more than twelve months) of individuals is 20%. These rates are subject to change by new legislation at any time.

Also, there is an additional tax of 3.8% on the "net investment income" of certain individuals, trusts and estates. Among other items, "net investment income" generally includes gross income from interest and dividends and net gain attributable to the disposition of certain property, less certain deductions. Prospective members should consult their tax advisors concerning the possible imposition of this tax in their particular circumstances.

Phantom Income and Related Considerations. Generally, the modification of a debt instrument (including a change in the yield, an addition, deletion or alteration of a put option, a call option or a conversion right) will be treated as a "deemed exchange" of the debt instrument for a "new" modified debt instrument for U.S. federal income tax purposes if such modification is "significant" within the meaning of the Treasury Regulations promulgated under Section 1001 of the Code (the "Section 1001 Regulations"). Such a deemed exchange would be a taxable event, unless a non-recognition provision of the Code were to apply. Under the Section 1001 Regulations, the modification of a debt instrument is generally significant if, based on all the facts and circumstances and taking into account all modifications of the debt instrument collectively, the legal rights or obligations that are altered and the degree to which they are altered are economically significant.

It is likely that the Loans owned by the Company will provide for interest payments at a stated rate that will not be paid by borrowers who are under economic distress. As a general rule, such interest is required to be accrued and included in taxable income by the Company with respect to each Loan unless the Company has determined, with reasonable certainty that such interest will never be paid by the borrower. In some instances the Company may take the position that unpaid interest on a Loan or Loan Interest is not required to be accrued as taxable income. The IRS imposes a strict reading of the requirement that nonaccrual of taxable income is only permissible if there is certainty that the interest will never be paid and, therefore, may disagree with the Company's nonaccrual of unpaid interest income. If the IRS position to that effect was successful, the Company would recognize taxable income, with no corresponding receipt of cash, with respect to the unpaid stated interest.

To the extent the Company recovers any principal payment with respect to a loan, it intends to treat the amount received first as a return of its tax basis in the loan (i.e., its purchase price) with any additional amount being treated as gain realized on the disposition of the loan. No portion of a principal payment will be treated as ordinary income attributable to either accrued and unpaid interest income or accrued market discount. It is possible that the IRS may disagree with such treatment and require that amounts received with respect to each loan be allocated first to unpaid stated interest that has accrued since the Company acquired the loan, then to accrued market discount, and lastly to recovery of the Company's tax basis in the loan. If that position by the IRS was successful, the Company would recognize a larger amount of taxable income, substantially all of which would be ordinary income (rather than capital gain), at an earlier point in time. Although the Company would realize a subsequent tax loss on its unrecovered tax basis in the loan, the loss may not be recognized until a subsequent tax year and would be a capital loss, rather than an ordinary loss, for federal income tax purposes.

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If the Company were to foreclose on a property securing a loan (or acquire the property through a deed-in-lieu of foreclosure transaction), it would recognize taxable gain on the disposition of the loan equal to the difference between the fair market value of the property on the date of foreclosure and the Company's tax basis in the loan. The Company would not receive any cash with respect to the property until it sold or leased the property. However, as described in this offering circular, the Managing Member may direct an affiliated entity to acquire in its own name title to any property securing a loan owned by the Company that is subject to foreclosure (or deed-in-lieu of foreclosure). That affiliate would be required to pay to the Company any amounts received by such affiliate with respect to the leasing or sale of the property as amounts due with respect to the mortgage loans securing such property, including any amounts owed in arrears. The payments received by the Company from such affiliate would be treated for federal income tax purposes as payments with respect to the related mortgage loan and reported as described above. The IRS may take the position that the activities of the Managing Member's affiliates with respect to the property securing a mortgage loan owned by the Company should be attributed to the Company. If that position was successful, the Company would recognize gain on the foreclosure without the receipt of cash, as described above.

Potential members are urged to consult their tax advisors regarding the possibility that the Company may recognize "phantom income" with respect to the ownership, modification or disposition of loans, or properties securing loans, or other adverse federal income tax consequences related thereto.

Deductions of Losses and Expenses

Tax Basis and Amount at Risk

For federal income tax purposes, a member may deduct losses and expenses allocated to it by the Company only to the extent of its adjusted tax basis in its Class A Units (or, in the case of individuals, certain non-corporate taxpayers and certain closely-held corporations, the lesser of such member's adjusted tax basis in its Class A Units or its "amount at risk" with respect to such Class A Unit) as of the end of the Company's taxable year in which such losses occur or such expenses are incurred.

Generally, a member's adjusted tax basis in its Class A Units is the amount paid for such Class A Units, reduced (but not below zero) by such member's share of the Company's distributions, losses and expenses, and increased by such member's share of the Company's liabilities, if any, and income and gain as determined for federal income tax purposes, including capital gains, with such reductions and increases made at the end of the Company's taxable year. (Tax basis is also important because gain or loss on cash distributions or partial or complete withdrawals from the Company is measured by reference to the adjusted tax basis of the member's Class A Units, as discussed below).

Generally, a member "amount at risk" with respect to a Class A Unit includes such member's (1) cash contributions to the Company; (2) the adjusted basis of other property contributed by such member to the Company; and (3) amounts borrowed for the purchase of Class A Units or for use by or in the Company for which such member is personally liable or which are secured by property of such member (not otherwise used by the Company) to the extent of the fair market value of the encumbered property. The "amount at risk" is increased by any income and gain (as determined for federal income tax purposes) derived by such member from the Company, and is decreased by any losses (as determined for federal income tax purposes) derived by such member from the Company and the amounts of any withdrawals or other distributions received by such member from the Company. For purposes of the foregoing, "loss" derived by a member from the Company is defined as the excess of allowable deductions for a taxable year allocated to such member by the Company over the amount of income actually received or accrued by such member during that year from the Company. Disallowed loss that is suspended in any taxable year may be deducted in later years to the extent that the member's amount at risk increases.

It is possible that a member may be at risk with respect to its Class A Units in an amount that is less than its tax basis in such Class A Units.

In addition to the limitations discussed above, net capital losses are deductible by noncorporate taxpayers only to the extent of capital gains for the taxable year plus $3,000. Because of that limitation, a member's distributive share of the Company's net capital losses is not likely to materially reduce the federal income tax on such member's ordinary income.

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Deductibility of Investment Expenditures by Noncorporate Investors

The Code provides that, in the case of a non-corporate taxpayer who itemizes deductions when computing taxable income, expenses incurred for the purpose of producing income (including investment management fees) generally must be aggregated with certain other "miscellaneous itemized deductions" and may be deducted only to the extent such aggregate expenses exceed 2% of such taxpayer's adjusted gross income. Further, such expenses are not deductible by a noncorporate member in calculating his alternative minimum tax liability. In addition, the Code further limits the deductibility of investment expenses of an individual with an adjusted gross income in excess of a specified amount. Additionally, business expenses allocable to exempt interest income are not deductible.

The amount of a member's allocable share of such expenses that is subject to this disallowance rule will depend on the member's aggregate miscellaneous itemized deductions from all sources and adjusted gross income for any taxable year. Thus, the extent, if any, to which such fees and expenses will be subject to disallowance will depend on each member's particular circumstances each year. It is intended that the allocation of profits and cash distributions made to the Managing Member with respect to the profit share is an allocable share of our earnings and not a fee. No assurance can be given however that the IRS could not recharacterize successfully the incentive allocations as a fee, in which case members could be subject to the limitation on deductibility relating to miscellaneous itemized deductions and certain other itemized deductions of high income individuals with respect to such amount, as described above. Prospective members are urged to consult their tax advisors regarding their ability to deduct expenses incurred by us.

Passive Activity Loss Rules

In the case of members that are individuals, estates, trusts, certain closely-held corporations or personal service corporations, Section 469 of the Code generally restricts the deductibility of losses and credits from a "passive activity" against certain income that is not derived from a passive activity. For federal income tax purposes, such passive losses and credits are deductible by a member only against such member's passive income. Members should consult their tax advisors regarding the possible application to them of the limitations on the deductibility of losses from certain passive activities contained in Section 469 of the Code.

Tax Consequences of Distributions

For purposes of distributions from a member's capital account in the Company, its interest is not divided into separate interests. Rather, a member's interest in the Company is "singular" even if the member has made capital contributions to the Company at different times, and a distribution from a capital account is treated for tax purposes as a distribution with respect to the entire related Class A Units. Thus, if a member receives a distribution of some but not all of his capital account, the full amount of each withdrawal or distribution will be taxable to the extent the amount of the withdrawal or distribution exceeds such member's adjusted tax basis in such Class A Units. To the extent the amount of a distribution does not exceed a member's tax basis in an Interest, such distribution generally is not reportable as taxable income but will reduce such tax basis, but not below zero. A member generally will not recognize losses on distributions.

Because a member's tax basis in its Class A Units is not increased by such member's allocable share of the Company's income from investment activities until the end of the Company's taxable year, distributions during the taxable year could result in taxable gain to the member even though no gain would result if the same withdrawals or distributions were made at the end of the taxable year. Furthermore, the share of the Company's income allocable to a member at the end of the Company's taxable year would also be includible in such member's taxable income and would increase such member's tax basis in its remaining Class A Units as of the end of such taxable year.

A member receiving a cash distribution from the Company in complete liquidation of its Class A Units generally will recognize capital gain or loss to the extent of the difference (if any) between the proceeds received and his adjusted tax basis in such Class A Units. Such capital gain or loss will be long-term, short-term or some combination of both, depending on the timing of such member's capital contributions to the Company. Notwithstanding the foregoing, Section 751 of the Code provides that a withdrawing member will recognize ordinary income to the extent the Company holds certain ordinary income items such as short-term obligations or market discount bonds, the interest on which has not been included in the Company's taxable income, regardless of whether the member would otherwise recognize a gain on such withdrawal.

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State and Local Taxes

Each member may be required to file returns and pay state and local tax on such member's share of the Company's income in the jurisdiction in which such member is a resident and/or other jurisdictions in which income is earned by the Company. Certain of such taxes could, if applicable, have a significant effect on the amount of tax payable by a member in respect of his investment in the Company. A member may be entitled to a deduction or credit against tax owed to such member's jurisdiction of residence for taxes paid to other states or jurisdictions in which such member is not a resident. The Company may be subject to certain taxes in certain states or localities despite the fact that it is not subject to federal income tax.

Tax Elections

The Managing Member, in its sole discretion, may make any tax elections provided for in the Code on behalf of the Company. These elections include the election under Section 754 of the Code to adjust the tax basis of the Company's assets when Class A Units in the Company are transferred or when a holder of Class A Units withdraws from the Company. The tax basis adjustment rules are mandatory when Class A Units are transferred to which there is a substantial built-in loss. A "substantial built-in loss" exists when the Company's adjusted basis in property exceeds by more than $250,000 the fair market value of such property. In lieu of the mandatory basis adjustment rules, special rules apply to electing investment partnerships and securitization partnerships.

Tax Audits

Adjustments in tax liability with respect to the Company's tax items generally will be made at the Company level in a single proceeding rather than in separate proceedings with each member. In general, the Managing Member will represent the Company as the "tax matters partner" during any audit and in any dispute with the IRS and may enter into a settlement agreement with the IRS that may be binding on you. Before settlement, however, a member may file a statement with the IRS that the Managing Member does not have authority to bind such member with respect to the Company.

The Managing Member has the authority to, and may, extend the period for the assessment of deficiencies or the claiming of refunds with respect to all members in the Company. If an audit results in an adjustment, all members may be required to pay additional tax, interest and possibly penalties. There can be no assurance that the tax return of the Company or any member will not be audited by the IRS or that no adjustments to such returns will be made as a result of such an audit.

The recently enacted Bipartisan Budget Act of 2015 changes the rules applicable to U.S. federal income tax audits of partnerships. Under the new rules (which are generally effective for taxable years beginning after December 31, 2017), among other changes and subject to certain exceptions, any audit adjustment to items of income, gain, loss, deduction, or credit of a partnership (and any partner's distributive share thereof) is determined, and taxes, interest, or penalties attributable thereto are assessed and collected, at the partnership level. Although it is uncertain how these new rules will be implemented, it is possible that they could result in the Company being required to pay additional taxes, interest and penalties as a result of an audit adjustment, and each member could be required to bear the economic burden of those taxes, interest and penalties even though the Company, as a partnership, may not otherwise have been required to pay additional corporate-level taxes as a result of the related audit adjustment. The changes created by these new rules are sweeping and, in many respects, dependent on the promulgation of future regulations or other guidance by the U.S. Treasury. Investors are urged to consult with their tax advisors with respect to those changes and their potential impact on their investment in Class A Units.

Withholding Taxes

The Company may be required, on behalf of a member, to withhold and remit taxes to federal, state, local or other jurisdictions from such member's allocable share of the Company's income. Withholding taxes may apply, for example, to persons who are subject to "back up" withholding or to any member that is not a U.S investor. To the extent that the Company is subject to any taxes or fees that are based on the specific characteristics of one or more member, such taxes or fees shall be specially allocated to such member(s).

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Disclosure of Tax Structure and Treatment

Notwithstanding anything to the contrary stated herein or in any other documents pertaining to an investment in the Company, an investor (and each employee, representative or other agent of a member) may disclose to any and all persons, without limitation of any kind, the anticipated tax treatment and tax structure of the Company and transactions contemplated by the Company), and all materials of any kind (including opinions or other tax analyses) related to such tax treatment and tax structure, if any.

Tax Information Reporting

While the Company will attempt to provide annual tax information to the members on a timely basis, the Managing Member expects that information may not be available in sufficient time to permit the Company to distribute such information prior to April 15 of each year. As a result, the Company may not distribute such information to the members until after April 15, and the members may be required to obtain extensions of time for filing their income tax returns. To the extent practical, the Company expects to provide estimates of annual tax information to the members prior to April 15 of each year in order to assist the members in determining if any tax payments must be made on or prior to April 15 notwithstanding the extension of the filing deadline. U.S. Treasury regulations require taxpayers to make certain additional disclosures in connection with the filing of any tax return that reflects tax benefits from a "reportable transaction" as defined in the regulations, which include certain transactions that generate losses in excess of threshold amounts. To the extent that the Company engages in a "reportable transaction," members may be required to make certain disclosures in connection with their tax returns and may be subject to penalties if such disclosures are not made.

Non-U.S. Investors

Under current U.S. federal income tax law, a member that is neither a U.S. person nor a partnership for U.S. federal income tax purposes (a "non-U.S. person") will be required to file U.S. income tax returns reporting, and to pay U.S. tax on, its share of any income of the Company that is effective connected with a U.S. trade or business. The Company may have income that is effectively connected with a U.S. trade or business. The Company may also have income that is effectively connected with a U.S. trade or business as a result of holding the mortgage loans. The Company may also have to withhold tax on non-U.S. persons' shares of certain income of the Company, including dividends and certain interest income. Non-U.S. prospective members should consult their own tax advisors before investing in the Company.

Special Tax Reporting; FATCA

If the Company invests in or holds assets through non-U.S. corporations, U.S. investors may be subject to substantial penalties if they fail to comply with special reporting requirements with respect to such investments, and U.S. investors may be required to file reports of Foreign Banks and Financial Accounts (also known as "FBARs"). Prospective U.S. investors should consult their own tax advisors regarding such reporting requirements.

Sections 1471 and 1474 of the Code (referred to herein as "FATCA") impose withholding taxes on certain types of payments made to "foreign financial institutions" and certain other non-U.S. entities. FATCA imposes a 30% withholding tax on "withholdable payments" paid to a foreign financial institution unless the foreign financial institution enters into an agreement with the United States Treasury requiring, among other things, that it undertake to (i) identify accounts held by certain United States persons or foreign entities owned by United States persons, (ii) annually report certain information about such accounts, and (iii) withhold 30% on payments to account holders whose actions prevent it from complying with these reporting and other requirements. "Withholdable payments" include, but are not limited to, United States source dividends, interest and gross proceeds from the sale of any property of a type that can produce United States source interest and dividends (generally equity or debt instruments of United States issuers). The Company may be required to deduct and withhold from amounts allocable to a non-U.S. investor who invests in the Company if that investor fails to comply with the reporting requirements imposed by the Service in respect of its direct and indirect U.S. investors under FATCA. Prospective non-U.S. investors should consult their tax advisers regarding this legislation.

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Unrelated Business Taxable Income

Tax-exempt entities and qualified plans, including public charities, private foundations, IRAs and other qualified retirement plans are subject to federal income tax on UBTI. The rates of such tax depend on the nature of the tax-exempt entity or qualified plan. UBTI is defined generally as gross income from any unrelated trade or business, less the allowable deductions that are directly related to the carrying on of the trade or business, with certain statutory modifications. For purposes of calculating UBTI, a partner in a partnership is considered to be engaged in the trade or business of the partnership. Thus, a member will be considered to be engaged in the business of the Company for UBTI purposes. Whether the trade or business of the Company will generate UBTI will depend generally on (a) the character of the Class A Units with respect to each member, (b) whether the Company has net taxable income and (c) the character of items of gross income generated by the Company.

As discussed above, a member will include in income its distributive share of items of Company income and losses. A member that is a tax-exempt entity or plan must categorize those items under the rules of Section 512 of the Code to determine whether they must be included in computing UBTI. Items of gross income that are generally excluded from UBTI include dividends, interest, and gains or losses from the sale of property held for investment. Items of Company income that would otherwise be excluded from UBTI, however, will generate UBTI if the income-producing property is considered "debt-financed property" within the meaning of Section 514 of the Code. Thus, it is possible that some of the investments held by the Company will constitute debt-financed property and will generate UBTI to an investor that is a tax-exempt entity or qualified plan. In addition, if an investor that is a tax exempt entity or qualified plan borrows money to acquire its Class A Units, those Class A Units will be treated as debt-financed property.

The foregoing is intended only as a general discussion of UBTI. The UBTI rules are complex, and their application depends in large part on the particular circumstances of each tax-exempt entity or qualified plan that invests in the Company. Any tax-exempt entity or qualified plan that is considering an investment in the Company should consult with its tax advisor regarding the impact of such an investment on UBTI.

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ERISA CONSIDERATIONS

The Employee Retirement Income Security Act of 1974, as amended ("ERISA"), is a broad statutory framework that governs most U.S. retirement and other U.S. employee benefit plans. ERISA and the rules and regulations of the Department of Labor (the "DOL") under ERISA contain provisions that should be considered by fiduciaries of employee benefit plans subject to the provisions of Title I of ERISA ("ERISA Plans") and their legal advisors. In particular, a fiduciary of an ERISA Plan should consider whether an investment in our Class A Units (or, in the case of a participant-directed defined contribution plan (a "Participant-Directed Plan"), making our Class A Units available for investment under the Participant-Directed Plan) satisfies the requirements set forth in Part 4 of Title I of ERISA, including the requirements that (1) the investment satisfy the prudence and diversification standards of ERISA, (2) the investment be in the best interests of the participants and beneficiaries of the ERISA Plan, (3) the investment be permissible under the terms of the ERISA Plan's investment policies and governing instruments and (4) the investment does not give rise to a non-exempt prohibited transaction under ERISA or Section 4975 of the Code.

In determining whether an investment in our Class A Units (or making our Class A Units available as an investment option under a Participant-Directed Plan) is prudent for ERISA purposes, a fiduciary of an ERISA Plan should consider all relevant facts and circumstances including, without limitation, possible limitations on the transferability of our Class A Units, whether the investment provides sufficient liquidity in light of the foreseeable needs of the ERISA Plan (or the participant account in a Participant-Directed Plan), and whether the investment is reasonably designed, as part of the ERISA Plan's portfolio, to further the ERISA Plan's purposes, taking into consideration the risk of loss and the opportunity for gain (or other return) associated with the investment. It should be noted that we will invest our assets in accordance with the investment objectives and guidelines described herein, and that neither our Managing Member nor any of its affiliates has any responsibility for developing any overall investment strategy for any ERISA Plan (or the participant account in a Participant-Directed Plan) or for advising any ERISA Plan (or participant in a Participant-Directed Plan) as to the advisability or prudence of an investment in us. Rather, it is the obligation of the appropriate fiduciary for each ERISA Plan (or participant in a Participant-Directed Plan) to consider whether an investment in our Class A Units by the ERISA Plan (or making such Class A Units available for investment under a Participant-Directed Plan in which event it is the obligation of the participant to consider whether an investment in our Class A Units is advisable), when judged in light of the overall portfolio of the ERISA Plan, will meet the prudence, diversification and other applicable requirements of ERISA. 

Section 406 of ERISA and Section 4975 of the Code prohibit certain transactions involving the assets of an ERISA Plan, as well as those plans that are not subject to ERISA but that are subject to Section 4975 of the Code, such as individual retirement accounts ("IRAs") and non-ERISA Keogh plans (collectively with ERISA Plans, "Plans"), and certain persons (referred to as "parties in interest" for purposes of ERISA or "disqualified persons" for purposes of the Code) having certain relationships to Plans, unless a statutory or administrative exemption is applicable to the transaction. A party in interest or disqualified person who engages in a non-exempt prohibited transaction may be subject to non-deductible excise taxes and other penalties and liabilities under ERISA and the Code, and the transaction might have to be rescinded. In addition, a fiduciary who causes an ERISA Plan to engage in a non-exempt prohibited transaction may be personally liable for any resultant loss incurred by the ERISA Plan and may be subject to other potential remedies. 

A Plan that proposes to invest in our Class A Units (or to make our Class A Units available for investment under a Participant-Directed Plan) may already maintain a relationship with our Managing Member or one or more of its affiliates, as a result of which our Managing Member or such affiliate may be a "party in interest" under ERISA or a "disqualified person" under the Code, with respect to such Plan (e.g., if our Managing Member or such affiliate provides investment management, investment advisory or other services to that Plan). ERISA (and the Code) prohibits plan assets from being used for the benefit of a party in interest (or disqualified person). This prohibition is not triggered by "incidental" benefits to a party in interest (or disqualified person) that result from a transaction involving the Plan that is motivated solely by the interests of the Plan. ERISA (and the Code) also prohibits a fiduciary from using its position to cause the Plan to make an investment from which the fiduciary, its affiliates or certain parties in which it has an interest would receive a fee or other consideration or benefit. In this circumstance, Plans that propose to invest in our Class A Units should consult with their counsel to determine whether an investment in our Class A Units would result in a transaction that is prohibited by ERISA or Section 4975 of the Code. 

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If our assets were considered to be assets of a Plan (referred to herein as "Plan Assets"), our management might be deemed to be fiduciaries of the investing Plan. In this event, the operation of the company could become subject to the restrictions of the fiduciary responsibility and prohibited transaction provisions of Title I of ERISA and/or the prohibited transaction rules of Section 4975 of the Code. 

The DOL has promulgated a final regulation under ERISA, 29 C.F.R. § 2510.3-101 (as modified by Section 3(42) of ERISA, the "Plan Assets Regulation"), that provides guidelines as to whether, and under what circumstances, the underlying assets of an entity will be deemed to constitute Plan Assets for purposes of applying the fiduciary requirements of Title I of ERISA (including the prohibited transaction rules of Section 406 of ERISA) and the prohibited transaction provisions of Code Section 4975. 

Under the Plan Assets Regulation, the assets of an entity in which a Plan or IRA makes an equity investment will generally be deemed to be assets of such Plan or IRA unless the entity satisfies one of the exceptions to this general rule. Generally, the exceptions require that the investment in the entity be one of the following: 

· in securities issued by an investment company registered under the Investment Company Act;

· in "publicly offered securities," defined generally as interests that are "freely transferable," "widely held" and registered with the SEC;

· in an "operating company" which includes "venture capital operating companies" and "real estate operating companies;" or

· in which equity participation by "benefit plan investors" is not significant.

The Class A Units will constitute an "equity interest" for purposes of the Plan Assets Regulation, and the Class A Units may not constitute "publicly offered securities" for purposes of the Plan Assets Regulation. In addition, the Class A Units will not be issued by a registered investment company.

The 25% Limit. Under the Plan Assets Regulation, and assuming no other exemption applies, an entity's assets would be deemed to include "plan assets" subject to ERISA on any date if, immediately after the most recent acquisition of any equity interest in the entity, 25% or more of the value of any class of equity interests in the entity is held by "benefit plan investors" (the "25% Limit"). For purposes of this determination, the value of equity interests held by a person (other than a benefit plan investor) that has discretionary authority or control with respect to the assets of the entity or that provides investment advice for a fee with respect to such assets (or any affiliate of such a person) is disregarded. The term "benefit plan investor" is defined in the Plan Assets Regulation as (a) any employee benefit plan (as defined in Section 3(3) of ERISA) that is subject to the provisions of Title I of ERISA, (b) any plan that is subject to Section 4975 of the Code and (c) any entity whose underlying assets include plan assets by reason of a plan's investment in the entity (to the extent of such plan's investment in the entity). Thus, while our assets would not be considered to be "plan assets" for purposes of ERISA so long as the 25% Limit is not exceeded. Our Operating Agreement provides that if benefit plan investors exceed the 25% Limit, we may redeem their interests at a price equal to the then current NAV per Class A Unit. We intend to rely on this aspect of the Plan Assets Regulation.

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Operating Companies. Under the Plan Assets Regulation, an entity is an "operating company" if it is primarily engaged, directly or through a majority-owned subsidiary or subsidiaries, in the production or sale of a product or service other than the investment of capital. In addition, the Plan Assets Regulation provides that the term operating company includes an entity qualifying as a real estate operating company ("REOC") or a venture capital operating company ("VCOC"). An entity is a REOC if: (i) on its "initial valuation date and on at least one day within each annual valuation period," at least 50% of the entity's assets, valued at cost (other than short-term investments pending long-term commitment or distribution to investors) are invested in real estate that is managed or developed and with respect to which such entity has the right to substantially participate directly in management or development activities; and (ii) such entity in the ordinary course of its business is engaged directly in the management and development of real estate during the 12-month period. The "initial valuation date" is the date on which an entity first makes an investment that is not a short-term investment of funds pending long-term commitment. An entity's "annual valuation period" is a pre-established period not exceeding 90 days in duration, which begins no later than the anniversary of the entity's initial valuation date. Certain examples in the Plan Assets Regulation clarify that the management and development activities of an entity looking to qualify as a REOC may be carried out by independent contractors (including, in the case of a partnership, affiliates of the general partner) under the supervision of the entity. An entity will qualify as a VCOC if (i) on its initial valuation date and on at least one day during each annual valuation period, at least 50% of the entity's assets, valued at cost, consist of "venture capital investments," and (ii) the entity, in the ordinary course of business, actually exercises management rights with respect to one or more of its venture capital investments. The Plan Assets Regulation defines the term "venture capital investments" as investments in an operating company (other than a VCOC) with respect to which the investor obtains management rights. 

If the 25% Limit is exceeded and we do not exercise our right to redeem benefit plan investors as described above, we may try to operate in a manner that will enable us to qualify as a VCOC or a REOC or to meet such other exception as may be available to prevent our assets from being treated as assets of any investing Plan for purposes of the Plan Assets Regulation. Accordingly, we believe, on the basis of the Plan Assets Regulation, that our underlying assets should not constitute "plan assets" for purposes of ERISA. However, no assurance can be given that this will be the case.

If our assets are deemed to constitute "plan assets" under ERISA, certain of the transactions in which we might normally engage could constitute a non-exempt "prohibited transaction" under ERISA or Section 4975 of the Code. In such circumstances, in our sole discretion, we may void or undo any such prohibited transaction, and we may require each investor that is a "benefit plan investor" to redeem their Class A Units upon terms that we consider appropriate. 

Prospective investors that are subject to the provisions of Title I of ERISA and/or Code Section 4975 should consult with their counsel and advisors as to the provisions of Title I of ERISA and/or Code Section 4975 relevant to an investment in our Class A Units. 

As discussed above, although IRAs and non-ERISA Keogh plans are not subject to ERISA, they are subject to the provisions of Section 4975 of the Code, prohibiting transactions with "disqualified persons" and investments and transactions involving fiduciary conflicts. A prohibited transaction or conflict of interest could arise if the fiduciary making the decision to invest has a personal interest in or affiliation with our company or any of its respective affiliates. In the case of an IRA, a prohibited transaction or conflict of interest that involves the beneficiary of the IRA could result in disqualification of the IRA. A fiduciary for an IRA who has any personal interest in or affiliation with our company or any of its respective affiliates, should consult with his or her tax and legal advisors regarding the impact such interest may have on an investment in our Class A Units with assets of the IRA. 

Shares sold by us may be purchased or owned by investors who are investing Plan assets. Our acceptance of an investment by a Plan should not be considered to be a determination or representation by us or any of our respective affiliates that such an investment is appropriate for a Plan. In consultation with its advisors, each prospective Plan investor should carefully consider whether an investment in our company is appropriate for, and permissible under, the terms of the Plan's governing documents. 

Governmental plans, foreign plans and most church plans, while not subject to the fiduciary responsibility provisions of ERISA or the provisions of Code Section 4975, may nevertheless be subject to local, foreign, state or other federal laws that are substantially similar to the foregoing provisions of ERISA and the Code. Fiduciaries of any such plans should consult with their counsel and advisors before deciding to invest in our Class A Units.

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  PLAN OF DISTRIBUTION

The offers and sales of our Class A Units will be made on a best efforts basis by broker-dealers who are members of FINRA. To date, we have engaged Cambria Capital, LLC, a FINRA member firm, on a non-exclusive basis to act as our placement agent for this offering. We may engage other placement agents. We have agreed to pay Cambria Capital a placement fee of 7.0% of the gross proceeds of this offering received by the Company that are derived from investors introduced to the Company by Cambria Capital, which we refer to as Cambria Referrals, and we have advanced to Cambria Capital a retainer in the amount of $15,000 for the payment of actual, accountable and reasonable out-of-pocket expenses incurred by it. This retainer amount will be set off against and credited toward the non-accountable expense reimbursement described below and will be reimbursed to the Company to the extent not actually incurred in accordance with FINRA Rule 5110(f)(2)(C). In addition, we have agreed to pay Cambria Capital a non-accountable expense reimbursement of 1.50% of the gross proceeds received by the Company in this offering that are derived from Cambria Referrals. We have also agreed to pay a platform fee of 0.5% to Folio on all investment funds that clear through the Folio platform. We will similarly compensate other placement agents that we engage and although future placement agents may receive fees and expense reimbursements in amounts less than that described above, no placement agent will be entitled to compensation in excess of the compensation described above.

Commissions and Expenses

The following table summarizes the discounts and commissions the Company will pay to broker dealers and placement agents.

		Total Fees
	Per Class A Units	Minimum Dollar Amount (1)	Offering Amount %	Maximum Offering Amount	Offering Amount %
Gross Proceeds	$10.00	$500,000.00	100%	$50,000,000.00	100%
Selling Commissions and Fees (2)	$0.70	$35,000.00	7.0%	$3,500,000.00	7.0%
Accountable Expense Allowance (3)	$0.15	$7,500.00	1.5%	$750,000.00	1.5%
Accountable Expense Allowance (4)	$0.05	$2,500.00	0.5%	$250,000.00	0.5%
Total commissions and fees	$0.90	$45,000	9.0%	$4,500,000.00	9.0%
Net Proceeds	$9.10	$455,000.00	91.0%	$45,500,000.00	91.0%

¹ This is a "best efforts" offering. We will not start operations or draw down on investors' funds and admit investors as members until we have raised at least $500,000 in this offering. Until the minimum threshold is met, investors' funds will be revocable and will be held in an escrow account with Provident Trust or in a subscriber's account at Folio Investments, Inc. with respect to those with accounts at Folio Investments, Inc. . If we do not raise $500,000 within 12 months, we will cancel the offering and release all funds from the escrow account or the subscriber's account at Folio Investments, Inc to the investors.

² Placement agents, including Cambria Capital, may receive selling commissions of up to seven percent (7%) of the gross offering proceeds.

³ Placement agents, including Cambria Capital, may receive a non-accountable expense allowance for due diligence, marketing and expense reimbursement of up to 1.5% of the gross proceeds of this offering.

⁴  FOLIO Investments, LLC may receive platform fee of up to 0.50% of the gross proceeds from this offering for fees for its clearing and facilitation services.

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On or prior to the initial closing of this offering, our C ompany, Cambria Capital and any other placement agents that we engage, will enter into a Placement Agent Agreement, a form of which is filed as an exhibit to the offering statement of which this offering circular is a part, for the sale of our Class A Units. Broker-dealers desiring to become members of the selling group will be required to execute a joinder and become a party to the placement agency agreement.

Best Efforts Offering

Cambria Capital has agreed, and additional placement agents will agree, use their respective best efforts to procure potential purchasers for the offered Class A Units. This offering is being undertaken on a best efforts only basis. Neither Cambria Capital nor any additional placement agent is required to take or pay for any specific number or dollar amount of our Class A Units.

Minimum Offering Amount and Minimum Purchase

We are offering a minimum of 50,000 and a maximum of 5,000,000 Class A Units at an offering price of $10.00 per unit, for a minimum offering amount of $500,000 and a maximum offering amount of $50,000,000. The minimum purchase requirement is 500 Class A Units, or $5,000; however, we can waive the minimum purchase requirement in our sole discretion.  We will not sell any Class A Units unless we raise the minimum offering amount of $500,000 within twelve (12) months of the effective date of this offering from persons who are not affiliated with us or our Managing Member.

Until we have raised this minimum amount, subscription payments from investors investing using the platform operated by Folio, will be deposited by the investor in such investor's account at Folio until such time as we have raised the minimum amount and all other subscription payments will be held in an escrow account with Provident Trust , our escrow agent, until such time as we have raised the minimum amount, in each case, in compliance with Exchange Act Rule 15c2-4, pending release to us. As a condition to the transfer of funds from subscribers to us for the initial closing only, the total amount of collective subscriptions accepted by us and supported by cleared funds in either a subscriber's brokerage account at Folio or at the escrow account maintained by the escrow agent, must be greater than the minimum offering amount. Upon confirmation from us that the combined funds deposited with the escrow agent and in customer accounts with Folio meet or exceed the minimum offering amount of $500,000, such combined funds, net of applicable expenses, will be released to us. Thereafter the offering may continue until the earlier of the date when all Class A Units have been sold to raise the maximum offering amount, the offering is terminated by us, or December 31, 2018.

If we do not raise at least $500,000 by the date that is 12 months after the effective date of this offering ("Termination Date"), we will promptly return all funds in the escrow account and an investor's funds that are in such investor's Folio account will remain in their Folio account, and we will stop offering Class A Units.  We will not deduct any fees if we are unable to raise the minimum amount by the Termination Date. 

Following achievement of our minimum offering amount, we intend to hold additional closings on at least a monthly basis.  The final closing will occur whenever we have reached the maximum offering amount or December 31, 2018, whichever occurs first. Until we achieve the minimum offering and thereafter until each closing, the subscription proceeds for that closing will either remain in an investor's brokerage account with Folio or will be kept in the escrow account with the escrow agent. Upon each closing, the proceeds will be disbursed to us net of applicable expenses and the Class A Units sold will be issued to the investors.

Investment Procedures

Folio Procedures

Prospective investors investing through Folio or a broker-dealer that clears through Folio will acquire our Class A Units through book-entry order through Cambria Capital or another placement agent by opening an account with Folio or a broker-dealer that clears through Folio, or utilizing an existing Folio account or existing account at a broker-dealer that clears through Folio, which will be an account owned by the investor and held by Folio for the exclusive benefit of such investor; provided, however that each investor will be required to complete and submit a subscription agreement.

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Subscriptions for the Class A Units acquired through the platform operated by Folio, which is a FINRA member and SEC-registered broker-dealer and clearing firm, are processed online. We intend to engage VStock Transfer, LLC as the transfer agent for this offering. The transfer agent will record and maintain records of the Class A Units issued by us. Folio will maintain the individual member records in the member's account opened by investors at Folio for the purpose of investing in this offering, and the transfer agent, on our behalf, will maintain records of the aggregate of all Class A Units held by Folio for the benefit of Folio's customers who are investors in the offering, and elsewhere. Class A Units issued through DTC Settlement will be held in the name of DTC, or its nominee, Cede & Co., on the books of the transfer agent.

The process for investing through the platform operated by Folio will work in the following manner. Folio has entered into a custody agreement with us pursuant to which we will issue uncertificated securities to be held at Folio, and the Class A Units held at Folio will show as an omnibus position on our records and the transfer agent's records in the name of " Folio Investments, Inc. for the exclusive benefit of customers." We will open a brokerage account with Folio and Folio will hold the Class A Units to be sold in the offering in book-entry form in our company's Folio account. When the Class A Units are sold as described below, Folio maintains a record of each investor's ownership interest in those securities. Under an SEC no-action letter provided to Folio in January 2015, Folio is allowed to treat the issuer as a good control location pursuant to Exchange Act Rule 15c3-3(c)(7) subject to the following conditions:

1. Folio carries the uncertificated securities "long" in customer's accounts;

2. Folio reflects separately all customer positions in the uncertificated securities records or ledgers pursuant to Rule 17a-3 under the Exchange Act;

3. Folio is not aware of any substantial problems of an operational nature that the Platform or the issuer of an Uncertificated Security may be experiencing which may endanger the interests of the customer;

4. Folio obtains written assurance of the uncertificated securities are not subject to any right, charge, security interest, lien, or claim or any kind in favor of the issuer or any person claiming through the issuer;

5. The issuer has determined to Folio's knowledge that the uncertificated securities are registered with the Commission pursuant to the Securities Act, exempt from registration, or not required to be registered; and

6. Folio maintains in a separate file a current list of issuers of uncertificated securities that are carried on its books and records subject to the terms and conditions set forth above.  For each issuer of uncertificated securities, the list will contain a contact person, telephone number, and address and the amount of shares or notional amount of such undertificated securities as reported by the issuer to Folio to be in the omnibus record position on the issuer's books.

 The customer's funds will not be transferred into a separate account awaiting the initial closing, or any other closing but will remain the customer's accounts at Folio pending instructions to release funds to us if all conditions necessary for a closing are met. Notwithstanding the foregoing, we intend to apply for DTC eligibility of our shares and if our shares gain DTC eligibility then the shares held in Folio accounts will be included in the position of DTC or its nominee on the records of our transfer agent.

In order to subscribe to purchase the Class A Units through the platform operated by Folio, a prospective investor must electronically complete and execute a subscription agreement and provide payment using the procedures indicated below.  When submitting the subscription request through Folio, a prospective investor is required to agree to various terms and conditions by checking boxes and to review and electronically sign any necessary documents. We will not accept any subscription agreements prior to the SEC's qualification of this offering.

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The funds that will be used by an investor purchasing through Folio to purchase the securities are deposited by the investor prior to the applicable closing date into a brokerage account at Folio, which will be owned by the investor.  The funds for the investor's account at Folio can be provided by check, wire, Automated Clearing House ("ACH") push, ACH pull, direct deposit, Automated Customer Account Transfer Service ("ACATS") or non-ACATS transfer.  Under an SEC no-action letter provided to Folio in July 2015, the funds may remain in the customer's account after they are deposited and until the conditions of the offering are satisfied and the offering closes.  The funds in customer accounts at Folio are generally swept into FDIC-insured bank accounts on a daily basis as part of Folio's cash sweep program as described below.  In addition, after the contingencies of the offering or any particular closing are met, we will notify Folio when we wish to conduct the closing.  Folio executes the closing by transferring each investor's funds from their Folio accounts to our Folio account and transferring the correct number of book-entry Class A Units to each investor's account from our Folio account.  The Class A Units are then reflected in the investor's online account and shown on the investor's Folio account statements.  Folio will also send trade confirmations individually to the investors.

In accordance the July SEC no-action letter, Folio will comply with the following conditions:

1. Folio is registered, self-clearing broker dealer that holds cash and securities on behalf of customer accounts pursuant to Exchange Act Rule 15c3-3 and maintains net capital pursuant to Exchange Act Rule 15c3-1;

2. No Folio Customer funds will come into the possession of the issuer until all contingencies are satisfied and the offering closes.

3. Each issuer is unaffiliated with Folio.

4. Issuers will promptly receive the offering proceeds due to the issuer if the contingencies are satisfied and the offering closes.

5. Folio Customers funds remain in the Cash Sweep Accounts until Settlement Date.

6. In the event that an offering or Conditional Offering is cancelled or a contingency is not met, Folio will promptly make Folio Customers funds available to the Folio Customer for use.

7. FDIC protection will be afforded to each Folio Customer in its Cash Sweep Program.

8. Except for a de minimis amount of Folio assets treated as non-allowable under SEC Rule 15c3-1, which are used by Folio for testing and demonstrations as well as facilitating customer trading fractional shares and odd lots, Folio will neither sweep any assets of Folio into any Cash Sweep Accounts that hold funds for securities offered on the Platform, no otherwise hold assets owned by Folio in such accounts.

9. To the extent a Conditional Offer requires that funds be available in the amount of the Conditional offer until Settlement Date, the amount of cash required will be promptly swept or maintained in the FDIC insured bank accounts used as part of the Cash Sweep Program for the benefit of the Folio Customer until such Conditional Offer is cancelled (if then cancellable), the conditions the offering are satisfied and the offering closes, or the issuer's offering is withdrawn or expired.

10. The amount of funds for each Folio Customer participating in the Cash Sweep Program at each bank participating in the Cash Sweep Program is recorded daily on Folio's books and records.  These amounts are clearly identified and recorded on a distinct section of the stock record or similar record.  Furthermore, Folio preserves this record for a period of not less than six years, the first two years in an easily accessible place in a manner consistent with the requirements of Exchange Act Rule 17a-4.

11. Folio treats records pertinent to the establishment and operations of the Cash Sweep Program as its own records and preserves these records for a period of not less than six years, the first two years in an easily accessible place in a manner consistent with the requirements of Rule 17a-4.

12. Folio will make and keep a separate record of each Conditional Offer.

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Non-Folio Procedures for Subscribing

        Investors not purchasing through Folio's platform must complete and execute a subscription agreement for a specific number of Class A Units and pay for the Class A Units at the time of your subscription. Subscription agreements may be submitted in paper form, or electronically if electronic subscription agreements and signature are made available to you by your broker-dealer or registered investment advisor. Generally, when submitting a subscription agreement electronically, a prospective investor will be required to agree to various terms and conditions by checking boxes and to review and electronically sign any necessary documents. You may pay the purchase price for your Class A Units by: (i) check; (ii) wire transfer in accordance with the instructions contained in your subscription agreement; or (iii) electronic funds transfer via ACH in accordance with the instructions contained in your subscription agreement.  All checks should be made payable to " Secured Real Estate Income Fund II, LLC "  Completed subscription agreements and payments should be sent by your broker-dealer or registered investment advisor, as applicable, to the escrow agent, at the address set forth in the subscription agreement. Subscriptions will be effective only upon our acceptance, and we reserve the right to reject any subscription in whole or in part. For any subscription agreement received prior to the effective date of this offering, we shall have a period of 30 days from the effective date to accept or reject the subscription agreement. For any subscription agreements received after the effective date, we shall have a period of 30 days after receipt of the subscription agreement to accept or reject the subscription agreement. If rejected, we will return all funds to the rejected subscribers within ten business days. If accepted, the funds will be transferred into our general account. You will receive a confirmation of your purchase. We will not accept subscription agreements prior to the SEC's qualification of this offering.

Delivery of Offering Circular

After the qualification date and prior to and concurrently with the delivery of any written offer to purchase our Class A Units, your securities dealer will provide you with a copy of the final offering circular by (i) electronic delivery of the final offering circular or the uniform resource locator to where the final offering circular may be accessed on the SEC's Electronic Data Gathering, Analysis and Retrieval System ("EDGAR"), or (ii) mailing the final offering circular to you at your address in your soliciting dealer's records. If a prospective investor receives the preliminary offering circular, then the soliciting dealer will deliver to the investor, which delivery may be made electronically or via delivering the EDGAR URL, the final offering circular at least 48 hours before such investor will be permitted to acquire Class A Units.

Investment Limitations

Generally, if you are not an "accredited investor" as defined in Rule 501 (a) of Regulation D (17 CFR §230.501 (a)) no sale may be made to you in this offering if the aggregate purchase price you pay is more than 10% of the greater of your annual income or net worth. Different rules apply to accredited investors and non-natural persons. Before making any representation that your investment does not exceed applicable thresholds, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov. 

As a Tier 2, Regulation A offering, investors must comply with the 10% limitation to investment in the offering. The only investor in this offering exempt from this limitation is an accredited investor, or an Accredited Investor, as defined under Rule 501 of Regulation D. If you meet one of the following tests you should qualify as an Accredited Investor:

(i)    You are a natural person who has had individual income in excess of $200,000 in each of the two most recent years, or joint income with your spouse in excess of $300,000 in each of these years, and have a reasonable expectation of reaching the same income level in the current year;

(ii)   You are a natural person and your individual net worth, or joint net worth with your spouse, exceeds $1,000,000 at the time you purchase Units (please see below on how to calculate your net worth);

(iii)  You are an executive officer or general partner of the issuer or a manager or executive officer of the general partner of the issuer;

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(iv)  You are an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, or the Code, a corporation, a Massachusetts or similar business trust or a partnership, not formed for the specific purpose of acquiring the shares, with total assets in excess of $5,000,000;

(v)   You are a bank or a savings and loan association or other institution as defined in the Securities Act, a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, an insurance company as defined by the Securities Act, an investment company registered under the Investment Company Act of 1940, as amended, or the Investment Company Act, or a business development company as defined in that act, any Small Business Investment Company licensed by the Small Business Investment Act of 1958 or a private business development company as defined in the Investment Advisers Act of 1940;

(vi)  You are an entity (including an Individual Retirement Account trust) in which each equity owner is an accredited investor;

(vii) You are a trust with total assets in excess of $5,000,000, your purchase of Units is directed by a person who either alone or with his purchaser representative(s) (as defined in Regulation D promulgated under the Securities Act) has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment, and you were not formed for the specific purpose of investing in the shares; or

(viii) You are a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has assets in excess of $5,000,000.

NOTE: For the purposes of calculating your net worth, or Net Worth, for purposes of determining compliance with the 10% limitation or the accredited investor standard, it is defined as the difference between total assets and total liabilities. This calculation must exclude the value of your primary residence and may exclude any indebtedness secured by your primary residence (up to an amount equal to the value of your primary residence). In the case of fiduciary accounts, net worth and/or income suitability requirements may be satisfied by the beneficiary of the account or by the fiduciary, if the fiduciary directly or indirectly provides funds for the purchase of the shares.

In order to purchase offered shares and prior to the acceptance of any funds from an investor, an investor will be required to represent, to our company's satisfaction, that he is either an accredited investor or is in compliance with the 10% of net worth or annual income limitation on investment in this offering. 

State Law Exemption and Offerings to "Qualified Purchasers"

Our Class A Units are being offered and sold only to "qualified purchasers" (as defined in Regulation A under the Securities Act). As a Tier 2 offering pursuant to Regulation A under the Securities Act, this offering will be exempt from state "Blue Sky" law review, subject to certain state filing requirements and anti-fraud provisions, to the extent that our Class A Units offered hereby are offered and sold only to "qualified purchasers" or at a time when our Class A Units are listed on a national securities exchange. "Qualified purchasers" include: (i) "accredited investors" under Rule 501(a) of Regulation D and (ii) all other investors so long as their investment in our Class A Units does not represent more than 10% of the greater of their annual income or net worth (for natural persons), or 10% of the greater of annual revenue or net assets at fiscal year-end (for non-natural persons). However, the Managing Member may elect, in its sole discretion, to sell our Class A Units only to those investors that are within the latter category (i.e., investors whose investment in our Class A Units does not represent more than 10% of the applicable amount), regardless of an investor's status as an "accredited investor." Accordingly, we reserve the right to reject any investor's subscription in whole or in part for any reason, including if we determine in our sole and absolute discretion that such investor is not a "qualified purchaser" for purposes of Regulation A.

Transferability of our Class A Units

Our Class A Units are generally freely transferable by our members subject to any restrictions imposed by applicable securities laws or regulations, compliance with the transfer provisions of our Operating Agreement and regulatory compliance and receipt of appropriate documentation. The transfer of any our Class A Units in violation of the Operating Agreement will be deemed invalid, null and void, and of no force or effect. Any person to whom our Class A Units are attempted to be transferred in violation of the Operating Agreement will not be entitled to vote on matters coming before the members, receive distributions from our company or have any other rights in or with respect to our Class A Units. We will not have the ability to reject a transfer of our Class A Units where all applicable transfer requirements, including those imposed under the transfer provisions of our Operating Agreement, are satisfied.

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Advertising, Sales and other Promotional Materials

In addition to this offering circular, subject to limitations imposed by applicable securities laws, we expect to use additional advertising, sales and other promotional materials in connection with this offering. These materials may include information relating to this offering, the past performance of our sponsor and its affiliates, property brochures, articles and publications concerning real estate, or public advertisements and audio-visual materials, in each case only as authorized by us. In addition, the sales material may contain certain quotes from various publications without obtaining the consent of the author or the publication for use of the quoted material in the sales material. Although these materials will not contain information in conflict with the information provided by this offering circular and will be prepared with a view to presenting a balanced discussion of risk and reward with respect to our Class A Units, these materials will not give a complete understanding of this offering, us or our Class A Units and are not to be considered part of this offering circular. This offering is made only by means of this offering circular and prospective investors must read and rely on the information provided in this offering circular in connection with their decision to invest in our Class A Units.

Offering Circular Supplements and Post-Qualification Amendments

In accordance with the Securities Act Industry Guide 5, we undertake to:

· to file a sticker supplement pursuant to Rule 253(e) under the Securities Act during the distribution period describing each real estate-related asset not identified in the offering circular at such time as there arises a reasonable probability that such asset will be acquired and to consolidate all such stickers into a post-qualification amendment filed at least once every three months, with the information contained in such amendment provided simultaneously to the existing members. Each sticker supplement shall disclose all compensation and fees received by our Managing Member and its affiliates in connection with any such acquisition. Where appropriate, the post-qualification amendment shall include or incorporate by reference audited financial statements meeting the requirements of Rule 3-14 of Regulation S-X for properties acquired during the distribution period; and

· to file, after the end of the distribution period, a current report on Form 1-U containing the financial statements and any additional information required by Rule 3-14 of Regulation S-X, where applicable, to reflect each subscription made after the end of the distribution period involving the use of 10% or more (on a cumulative basis) of the net proceeds of the offering and to provide the information contained in such report to the members at least once each quarter after the distribution period of the offering has ended.

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HOW TO SUBSCRIBE

Subscription Procedures

Investors seeking to purchase our Class A Units must satisfy the "qualified purchaser" standards and have read the entire offering circular and any supplements accompanying this offering circular.

Subscriptions for the Class A Units will be either received directly by the Company or processed by Folio. For subscriptions processed through Folio, the Company will open a brokerage account with Folio and Folio will hold the Class A Units to be sold in the offering through Folio in book-entry form in the Company's Folio account. When the Class A Units are sold through Folio, Folio maintains a record of each investor's ownership interest in those securities. Under an SEC no-action letter provided to Folio in January 2015, Folio is allowed to treat the issuer as a good control location pursuant to Exchange Act Rule 15c3-3(c)(7) under these circumstances. The customer's funds will not be transferred into a separate account awaiting the initial closing, or any other closing, but will remain the customer's accounts at Folio pending instructions to release funds to the Company if all conditions necessary for a closing are met.

In order to subscribe to purchase the Class A Units, a prospective investor must execute a subscription agreement and provide payment using the procedures indicated in the subscription agreement. To invest in this offering through Folio, a prospective investor must have a brokerage account with Folio, either directly or through a broker dealer that is operating under a fully disclosed clearing agreement on the Folio clearing brokerage. Prospective investors will be able to access the offering materials, including this offering circular, online, where they can submit a subscription request to purchase Class A Units in the offering. The funds for the investor's account at Folio can be provided by check, wire, ACH or ACATS transfer. After any contingencies of the offering are met, the Company will notify Folio when it wishes to conduct a Closing.

By executing the subscription agreement and paying the total purchase price for our Class A Units subscribed for, each investor agrees to accept the terms of the subscription agreement and attests that the investor meets the minimum standards of a "qualified purchaser", and that such subscription for Class A Units does not exceed 10% of the greater of such investor's annual income or net worth (for natural persons), or 10% of the greater of annual revenue or net assets at fiscal year-end (for non-natural persons). Subscriptions will be effective only upon our acceptance and we reserve the right to reject any subscription in whole or in part.

The minimum offering amount is $500,000 and we may not accept subscriptions until such time as we have received subscriptions equaling the minimum offering amount. Prior to our achieving the minimum offering amount, subscribers may revoke their subscription by providing us with a written notice requesting such rescission, to be sent to the following address:

SREIF MANAGER II, LLC

1999 South Bascom Avenue, 7^th Floor

Campbell, CA 95008

Following the date on which the minimum offering amount has been achieved, subscriptions will be accepted or rejected within 30 days of receipt by us. We have until the date that is twelve months after the date of this offering circular to achieve the minimum offering amount.

We will not draw funds from any subscriber until the date we achieve the minimum offering amount or the date your subscription is accepted, whichever is later. If we accept your subscription, we will email you a confirmation.

An approved trustee must process and forward to us subscriptions made through IRAs, Keogh plans and 401(k) plans. In the case of investments through IRAs, Keogh plans and 401(k) plans, we will send the confirmation and notice of our acceptance to the trustee.

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Vstock Transfer, LLC (the "Transfer Agent") shall act as transfer agent and shall record and maintain the records of the Class A Units issued by the Company.

Minimum Purchase Requirements

You must initially purchase at least 500 Class A Units in this offering, or $5,000 based on the current per Class A Unit price. In order to satisfy this minimum purchase requirement, unless otherwise prohibited by state law, a husband and wife may jointly contribute funds from their separate IRAs, provided that each such contribution is made in increments of $1,000 and meets the total $5,000 minimum. You should note that an investment in our Class A Units will not, in itself, create a retirement plan and that, in order to create a retirement plan, you must comply with all applicable provisions of the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code. If you have satisfied the applicable minimum purchase requirement, any additional purchase must be in amounts of at least $1000 (or the then NAV of our Class A Units).

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LEGAL MATTERS

Certain legal matters, including the validity of Class A Units offered hereby, have been passed upon for us by Carman Lehnhof Israelsen, LLP. 

EXPERTS

The Managing Member has retained DBB McKennon to advise it in connection with the preparation of the audited balance sheet of the Company in connection with this offering.  DBB McKennon has not been retained to represent the interests of any Investors or members in connection with this offering. Prospective investors that are evaluating or purchasing Class A Units should retain their own independent tax counsel to review this offering, this offering circular and any supplements and amendments, the Operating Agreement, the Subscription Agreement and any other documents related to this offering, and advise them accordingly.

We have not engaged an independent valuation services firm, and do not intend to do so until such time as we are required to do so. As further described under "Valuation Policies", our internal accountants will use the estimated market values provided as well as inputs from other sources in its calculation of our quarterly net asset value (NAV) per Class A Unit.

ADDITIONAL INFORMATION

We have filed with the SEC an offering statement under the Securities Act on Form 1-A regarding this offering. This offering circular, which is part of the offering statement, does not contain all the information set forth in the offering statement and the exhibits related thereto filed with the SEC, reference to which is hereby made. Upon the qualification of the offering statement, we will be subject to the informational reporting requirements of the Exchange Act that are applicable to Tier 2 companies whose securities are registered pursuant to Regulation A, and accordingly, we will file annual reports, semi-annual reports and other information with the SEC. You may read and copy the offering statement, the related exhibits and the reports and other information we file with the SEC at the SEC's public reference facilities maintained by the SEC at 100 F Street, N.E., Washington, DC 20549. You can also request copies of those documents, upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330 for further information regarding the operation of the public reference rooms. The SEC also maintains a website at www.sec.gov that contains reports, information statements and other information regarding issuers that file with the SEC.

You may also request a copy of these filings at no cost, by writing, emailing or telephoning us at:

Secured Real Estate Income Fund II, LLC

Administration Office

2090 N. Kolb Road, Ste 120 

Tucson, AZ 85715

Tel: (888) 444-2102

Secured Real Estate Income Fund II, LLC

c/o SREIF MANAGER II, LLC

1999 South Bascom Avenue, 7^th Floor

Campbell, CA 95008

Within 120 days after the end of each fiscal year we will provide to our members of record an annual report. The annual report will contain audited financial statements and certain other financial and narrative information that we are required to provide to members.

We also maintain a website at www.SecuredRealEstateFunds.com, where there may be additional information about our business, but the contents of that site are not incorporated by reference in or otherwise a part of this offering circular.

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INDEX TO FINANCIAL STATEMENTS OF SECURED REAL ESTATE INCOME FUND II, LLC

INDEPENDENT AUDITOR'S REPORT	F-1
Balance Sheet as of December 31, 2016	F-3
Statement of Operations from Date of Formation Through December 31, 2016	F-4
Statement of Member's Equity from Date of Formation Through December 31, 2016	F-5
Statement of Cash Flows from Date of Formation Through December 31, 2016	F-6
Notes to Financial Statements	F-7

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Continued

F-1

F-2

SECURED REAL ESTATE INCOME FUND II, LLC

STATEMENT OF FINANCIAL CONDITION

AS OF DECEMBER 31, 2016

ASSETS
Deferred offering costs	$	81,983
Total assets		81,983
LIABILITIES AND MEMBER'S EQUITY
Note payable to related party		85,051
Accounts payable		18,810
Accrued interest to related party		1,207
Total liabilities		105,068
Commitments and contingencies (Note 4)		-
Member's Equity:  (Notes 5 and 6)
Class A Units issued and outstanding -
5,000,000 authorized and none outstanding		-
Class B Units issued and outstanding -
100 authorized and outstanding		-
Net loss		(23,085	)
Total member's equity		(23,085	)
Total liabilities and member's equity	$	81,983

See accompanying notes to the financial statements

F-3

SECURED REAL ESTATE INCOME FUND II, LLC

STATEMENT OF OPERATIONS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

Revenues	$	-
General and administrative expenses		21,878
Loss from operations		(21,878	)
Interest expense to related party		1,207
Net loss	$	(23,085	)
Loss per Unit	$	(230.85	)
Weighted average Units outstanding		100

See accompanying notes to the financial statements

F-4

SECURED REAL ESTATE INCOME FUND II, LLC

STATEMENT OF MEMBER'S EQUITY

DATE OF FORMATION THROUGH DECEMBER 31, 2016

	Class A Units				Class B Units
	Units		Amount		Units		Amount		Accumulated Deficit			Total Member's Equity
Balance, at Formation		-	$	-		-	$	-	$	-		$	-
Class B Units issued to manager		-		-		100		-		-			-
Net loss		-		-						(23,085	)		(23,085	)
Balance, December 31, 2016		-	$	-		100		-		(23,085	)		(23,085	)

See accompanying notes to the financial statements

F-5

SECURED REAL ESTATE INCOME FUND II, LLC

STATEMENT OF CASH FLOWS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(23,085	)
Changes in operating assets and liabilities:
Increase in accounts payable		18,810
Accrued  interest to related party		1,207
Net cash used in operating activities		(3,068	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from note payable from related party		85,051
Payments for deferred offering cost		(81,983	)
Net cash provided by financing activities		3,068
Increase in cash and cash equivalents		-
Cash and cash equivalents, at Formation		-
Cash and cash equivalents, end of period	$	-
Supplemental disclosures of cash flow information:
Cash paid for interest	$	-
Cash paid for income taxes	$	-

See accompanying notes to the financial statements

F-6

SECURED REAL ESTATE INCOME FUND II, LLC

NOTES TO FINANCIAL STATEMENTS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

NOTE 1 – ORGANIZATION AND BUSINESS

Secured Real Estate Income Fund II, LLC (the "Fund" or the "Company") was formed on June 15, 2016 (date of "Formation") in the State of Delaware.  The Company's headquarters are located in Tucson, Arizona. The Company was formed for the purpose of investing in a diversified portfolio of real estate loans and other debt instruments collateralized by first and second position security interests in residential real estate in the U.S. and the underlying real estate collateral.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Going Concern and Management's Plans

The Fund will rely heavily on equity financing for working capital to fund start-up and development activities. This raises substantial doubt about the Fund's ability to continue as a going concern. We expect to complete the equity offering and acquire the portfolio of real estate loans during the next 36 months. The manager intends to fund its operations with funding from operational income. There are no assurances that management will be able to raise capital on terms acceptable to the Company. If we are unable to obtain sufficient amounts of capital, we may be required to reduce the scope of our planned loan operations, which could harm our business, financial condition and operating results. The financial statements do not include any adjustments that might result from these uncertainties. Despite the inherent risks of any new business, the decades of relevant industry experience coupled with an experienced management team provide our basis for belief that the Fund can be a success for stakeholders.

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America ("US GAAP").

Use of Estimates

The preparation of the financial statements in conformity with US GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, and the reported Amount of revenues and expenses during the reporting period. Actual results could materially differ from these estimates. It is reasonably possible that changes in estimates will occur in the near term.

Fair Value of Financial Instruments

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

F-7

SECURED REAL ESTATE INCOME FUND II, LLC

NOTES TO FINANCIAL STATEMENTS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 - Include other inputs that are directly or indirectly observable in the marketplace.

Level 3 - Unobservable inputs which are supported by little or no market activity.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Fair-value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2016. Fair values were assumed to approximate carrying values because of their short term in nature.

Risks and Uncertainties

The Fund has a limited operating history and has not generated revenue from intended operations. The Funds business and operations are sensitive to general business and economic conditions in the U.S. A host of factors beyond the Fund's control could cause fluctuations in these conditions. Adverse conditions may include: recession, downturn or otherwise. These adverse conditions could affect the Fund's financial condition and the results of its operations.

Cash and Cash Equivalents

For purpose of the statement of cash flows, we consider all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.

Deferred Offering Costs

The Fund capitalizes costs of its offering of securities which will be applied against proceeds received if successful. If unsuccessful, such costs will be expensed.

Loans Held for Investment

Loans held for investment will be carried at amortized cost, net of discounts and premiums, deferred loan origination fees, costs and the allowance for loan losses. Net deferred loan origination fees and costs on loans are amortized or accreted using the interest method over the expected life of the loans. Amortization of deferred loan fees and costs are discontinued for loans placed on nonaccrual. Any remaining deferred fees or costs and prepayment fees associated with loans that payoff prior to contractual maturity are included in loan interest income in the period of payoff. Loan commitment fees received to originate or purchase a loan are deferred and, if the commitment is exercised, recognized over the life of the loan as an adjustment of yield or, if the commitment expires unexercised, recognized as income upon expiration of the commitment. Loans held for investment are not adjusted to the lower of cost or estimated market value because it is management's intention, and the Company has the ability, to hold these loans to maturity.

Interest on loans is credited to income as earned. Interest receivable is accrued only if deemed collectible. Loans on which the accrual of interest has been discontinued are designated as nonaccrual loans. The accrual of interest on loans is discontinued when principal or interest is past due 90 days based on contractual terms of the loan or when, in the opinion of management, there is reasonable doubt as to collection of interest. When loans are placed on nonaccrual status, all interest previously accrued but not collected is reversed against current period interest income.

F-8

SECURED REAL ESTATE INCOME FUND II, LLC

NOTES TO FINANCIAL STATEMENTS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

Interest income generally is not recognized on impaired loans unless the likelihood of further loss is remote. Interest payments received on such loans are applied as a reduction to the loan principal balance. Interest accruals are resumed on such loans only when they are brought current with respect to interest and principal and when, in the judgment of management, the loans are estimated to be fully collectible as to all principal and interest.

A loan is considered to be impaired when it is probable that the Company will be unable to collect all amounts due (principal and interest) according to the contractual terms of the loan agreement. We review loans for impairment when the loan is classified as substandard or worse, delinquent 90 days, determined by management to be collateral dependent, or when the borrower files bankruptcy or is granted a troubled debt restructure. Measurement of impairment is based on the loan's expected future cash flows discounted at the loan's effective interest rate, measured by reference to an observable market value, if one exists, or the fair value of the collateral if the loan is deemed collateral dependent. The Company selects the measurement method on a loan-by-loan basis except those loans deemed collateral dependent. All loans are generally charged-off at such time the loan is classified as a loss.

Allowance for Loan Losses

The Company will maintain an allowance for loan losses at a level deemed appropriate by management to provide for known or inherent risks in the loan at the reporting date. The Company has implemented and adheres to an internal asset review system and loss allowance methodology designed to provide for the detection of problem assets and an adequate allowance to cover loan losses. Our determination of the adequacy of the loan loss allowance is based on an evaluation of the composition of the loan, actual loss experience, industry charge-off experience on income property loans, current economic conditions, and other relevant factors in the area in which the fund's lending activities are based. These factors may affect the borrowers' ability to pay and the value of the underlying collateral. The allowance is calculated by applying loss factors to loans held for investment according to loan program type and loan classification. The loss factors are established based primarily upon the Fund's historical loss experience and the industry charge-off experience and are evaluated on a quarterly basis. Additions and reductions to the allowance are reflected in current operations.

Real Estate Owned

Real estate properties acquired through, or in lieu of, loan foreclosure are recorded at fair value less cost to sell with any excess loan balance charged against the allowance for estimated loan losses. The Fund will obtain an appraisal and/or market valuation on all real estate owned at the time of possession. After foreclosure, valuations are periodically performed by management. Any subsequent fair value losses are recorded to other real estate owned operations with a corresponding write-down to the asset. All legal fees and direct costs, including foreclosure and other related costs are expensed as incurred.

Stock-Based Compensation

The Company will account for stock options issued to employees under ASC 718 "Share-Based Payment". Under ASC 718, share-based compensation cost to employees is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the employee's requisite vesting period. The fair value of each stock option or warrant award is estimated on the date of grant using the Black Scholes option valuation model.

F-9

SECURED REAL ESTATE INCOME FUND II, LLC

NOTES TO FINANCIAL STATEMENTS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

The Company will measure compensation expense for its non-employee equity-based compensation under ASC 505 "Equity." The fair value of the option issued or committed to be issued is used to measure the transaction, as this is more reliable than the fair value of the services received. The fair value is measured at the value of the Company's common stock on the date that the commitment for performance by the counterparty has been reached or the counterparty's performance is complete. The fair value of the equity instrument is charged directly to equity-based compensation expense and credited to additional paid-in capital.

Income Taxes

The Fund is a Limited Liability Company ("LLC") taxed as a partnership. Under these provisions, the Company does not pay federal corporate income taxes on its taxable income. Instead, the equity holders are liable for individual federal and state income taxes on their respective shares of the Fund's taxable income. The Fund has not yet filed a tax return and therefore is not yet subject to tax examination by the Internal Revenue Service or state regulatory agencies.

Concentration of Credit Risk

The Fund may maintain its cash with a financial institution located in the United States. The Federal Deposit Insurance Corporation insures balances up to $250,000. At times, the Fund may maintain balances in excess of the federally insured limits.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers". Under this guidance, revenue is recognized when promised goods or services are transferred to customers in an amount that reflects the consideration expected to be received for those goods or services. The updated standard will replace most existing revenue recognition guidance under U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. The updated standard will be effective beginning January 1, 2018. We are currently evaluating the effect that the updated standard will have on our financial statements and related disclosures. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements Going Concern, which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter. The guidance is not expected to have a material impact on the Company's financial statements.

In April 2015, FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of debt issuance costs will continue to be reported as interest expense. ASU 2015-03 is effective for annual reporting periods beginning after December 15, 2015. Early adoption is permitted. The guidance is not expected to have a material impact on the Company's financial statements. In November 2015, the FASB issued ASU No. 2015-17, "Income Taxes: Balance Sheet Classification of Deferred Taxes", which requires deferred tax liabilities and assets to be classified as noncurrent in a classified statement of financial position. ASU 2015-17 will align the presentation of deferred income tax assets and liabilities with International Financial Reporting Standards. The new standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those annual years, and early application is permitted. We are currently evaluating the effect that the updated standard will have on our financial statements and related disclosures.

F-10

SECURED REAL ESTATE INCOME FUND II, LLC

NOTES TO FINANCIAL STATEMENTS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

In February 2016, FASB issued ASU No. 2016-02, Leases, that requires organizations that lease assets, referred to as "lessees", to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases with lease terms of more than 12 months. ASU 2016-02 will also require disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases and will include qualitative and quantitative requirements. The new standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those annual years, and early application is permitted. We are currently evaluating the effect that the updated standard will have on our financial statements and related disclosures.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The amendments replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. For public business entities, the amendment is effective for annual periods beginning after December 15, 2019 and interim period within those annual periods. We are currently evaluating the effects of ASU 2016-13 on its financial statements and disclosures.

The FASB issues ASUs to amend the authoritative literature in ASC. There have been a number of ASUs to date, including those above, that amend the original text of ASC. We believe that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to us or (iv) are not expected to have a significant impact on our financial statements.

NOTE 3 - NOTE PAYABLE TO RELATED PARTY

Since July 1, 2016, the Company has had a line of credit for borrowings of up to $125,000 from SREIF Manager II, LLC, a related company. Borrowings are subject to interest at 5%, per annum, and due together with interest on June 1, 2017. As of December31, 2016, the Company had borrowings totaling $85,051 and accrued interest of $1,207. As of December 31, 2016, the Company had $39,949 available under the line of credit. Interest expense was $1,207 for the period ended December 31, 2016. Subsequent to December 31, 2016, the Company increased their borrowing capacity to $150,000.

NOTE 4 – COMMITMENTS AND CONTINGENCIES

The Company is not currently involved with, and does not know of any pending or threatening litigation against the Company or any of its officers.

Placement Agent Agreement

The Company has engaged Cambria Capital, LLC, a FINRA member firm, as its non-exclusive placement agent and has agreed to pay Cambria Capital a placement fee of 7.0% of the gross proceeds of this offering received by the Company that are derived from investors introduced to the Company by Cambria Capital. On October 4, 2016 the Company advanced to Cambria Capital a retainer in the amount of $15,000 for the payment of actual, accountable and reasonable out-of-pocket expenses incurred by it. This retainer amount will be set off against and credited toward the non-accountable expense reimbursement described below. In addition, the Company has agreed to pay Cambria Capital a non-accountable expense reimbursement of 1.50% of the gross proceeds received by the Company in this offering that are derived from Cambria Referrals.

F-11

SECURED REAL ESTATE INCOME FUND II, LLC

NOTES TO FINANCIAL STATEMENTS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

The Company has also agreed to pay a platform fee of 0.5% to Folio Investments, Inc on all investment funds that clear through the Folio platform. Accordingly, the underwriting discounts, commissions and expense reimbursements may amount to 9% of the gross offering proceeds received by the Company in this offering

that are derived from Cambria Referrals.

NOTE 5 – MEMBER'S EQUITY

LLC Units

There will be two classes of Units: Class A Units and Class B Units. The Class A Units have 5,000,000 Units authorized and none outstanding. The Class A Units are being offered to the public. The Class B Units has 100 Units authorized and outstanding which are held by the managing member. See below for further discussion of the terms of these classes of units.

NOTE 6 – OPERATING AGREEMENT

The Operating Agreement provides, inter alia, for the following:

The limited liability company interests in the Company shall consist exclusively of Interests in the Company. The Interests shall be divided into two (2) classes, the Class B Interests, which shall be held exclusively by the Managing Member and the Class A Interests which shall be held by all other Members as the Investors.

Members holding Class A Interests will be entitled to a Preferred Return of an amount equal to eight percent (8%) per annum of the total amount of unreturned Capital Contributions (including reinvested Net Income) from the inception date of a Member's initial Capital Contribution. The Managing Member shall receive an Asset Management Fee in the amount of 2% per annum of the Capital Contributions, as adjusted from time to time.

The Company shall reimburse the Managing Member for organizational and initial offering costs and expenses incurred by the Managing Member in an amount not to exceed $150,000. Each Member will be required to contribute not less than $5,000 to the Company for the purchase of Class A Interests, although the Managing Member may elect to accept less in its sole discretion.

The Initial Closing shall occur on the first day in which the Company receives Capital Contributions in the aggregate amounts equal to or exceeding the Minimum Capital Amount of $500,000 for the purchase of Interests.

The Company generally will bear all costs and expenses associated with the initial setup of the Company and the offering of Interests and its ongoing operations, except as otherwise described in the Offering Circular.

The Fund shall distribute net Income received with respect to the assets to the relevant Members, subject to any reserves or Company expenses as reasonably determined by the Managing Member. The Fund shall make all such distributions of Net Income to the Class A Members and Class B Members in the following order of priority, and among them in accordance with their respective class percentages:

 (i)  first, to the Class A Members until the total amount distributed to them pursuant to Section 6.1(a)(i) equals the amount of their unpaid Class A Preferred Return;

(ii)  next, to the Managing Member until the amount distributed pursuant to Section (ii) equals two percent (2%) of the amount distributed to the Class A Members pursuant to Section 6.1(a)(i); and,

(iii)  the remaining Net Income shall be distributed (a) eighty percent (80%) to the Class A Members

F-12

SECURED REAL ESTATE INCOME FUND II, LLC

NOTES TO FINANCIAL STATEMENTS

DATE OF FORMATION THROUGH DECEMBER 31, 2016

and (b) twenty percent (20%) to the Managing Member as its "Carried Interest".

Capital Withdrawals are subject to an initial eighteen (18) month lock-up period from the date of closing of a purchase of Interests by a Member, and no capital withdrawals will be made by a Member at any time prior to the end of the lock-up period; provided, however, the Managing Member may, in its sole discretion, allow the redemption of a Member's investment prior to the expiration of the applicable lock-up period subject to a discretionary withdrawal penalty equal to ten percent (10%) of the amount of the capital withdrawal.

NOTE 7 - SUBSEQUENT EVENTS

The Company has evaluated subsequent events that occurred after December 31, 2016 through January 31, 2017. There have been no other events or transactions during this time that would have a material effect on the financial statements.

F-13

FORM 1-A

Regulation A Offering Statement

Part III – Exhibits

SECURED REAL ESTATE INCOME FUND II, LLC

1999 South Bascom Avenue, 7th Floor

Campbell, CA 95008

(408) 369-1571

The following Exhibits are filed as part of this Offering Statement

Exhibit 1.1	Form of Placement Agent Agreement*
Exhibit 2.1	Certificate of Formation*
Exhibit 2.2	Amended and Restated Operating Agreement dated January 5, 2017
Exhibit 6.1	Investment Management Agreement dated July 1, 2016*
Exhibit 6.2	Servicing Agreement dated July 1, 2016*
Exhibit 6.3	Subscription Agreement
Exhibit 8.1	Escrow Agreement
Exhibit 8.2	Escrow and Custody Agreement
Exhibit 11.1	Consent of Independent Auditor
Exhibit 12.1	Legal Opinion of Carman Lehnhof Israelsen, LLP as to the legality of the securities being qualified
Exhibit 12.2	Legal Opinion of Tax Counsel Durham Jones & Pinegar, P.C. as to certain federal income tax considerations
Exhibit 13.1	"Test the waters" material – SREIF II Brochure
Exhibit 13.2	"Test the waters" material- Video Script
Exhibit 15.1	Transfer Agent and Registrar Agreement
Exhibit 15.2	FOLIOfn Investments, Inc. (Rule 15c2-4) SEC no action letter 7-15-2015

*    Previously filed

**To be filed by amendment

SIGNATURES

Pursuant to the requirements of Regulation A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A and has duly caused this offering statement to be signed on its behalf by the undersigned, thereunto duly authorized on February 6, 2017 .

Secured Real Estate Income Fund II, LLC
By: SREIF Manager II, LLC Its: Managing Member
By	/s/ Thomas Braegelmann
	Thomas Braegelmann, Chief Executive Officer
By	/s/ Charles Tralka
	Charles Tralka, Chief Investment Officer

By	/s/ Matthew Sullivan
	Matthew Sullivan, Director of Investor Relations

By	/s/ Jordan Goodman
	Jordan Goodman, Investment Director

This offering statement has been signed by the following persons in the capacities and on the dates indicated.

/s/ Charles Tralka

Charles Tralka, Chief Investment Officer

SREIF Manager II, LLC, Managing Member

February 6, 2017

/s/ Thomas Braegelmann

Thomas Braegelmann, Chief Executive Officer

SREIF Manager II, LLC, Managing Member

February 6, 2017

/s/ Matthew Sullivan

Matthew Sullivan, Director of Investor Relations

SREIF Manager II, LLC, Managing Member

February 6, 2017

/s/ Jordan Goodman

Jordan Goodman, Investment Director

SREIF Manager II, LLC, Managing Member

February 6, 2017

EX1A-2B BYLAWS

LIMITED LIABILITY COMPANY

OPERATING AGREEMENT

OF

SECURED REAL ESTATEINCOME FUNDII, LLC

(a Delaware limited liability company)

THE LIMITED LIABILITY COMPANY INTERESTS ("INTERESTS") ISSUED PURSUANT TO THIS LIMITED LIABILITY COMPANY AGREEMENT ("AGREEMENT")HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE. INTERESTS MAY NOT BE TRANSFERRED UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. IN ADDITION, TRANSFERS OF INTERESTS ARE SUBJECT TO THE RESTRICTIONS SET FORTH IN SECTION 5.4 OF THIS AGREEMENT.

TABLE OF CONTENTS

		Page
ARTICLE I.	DEFINITIONS	1
ARTICLE II.	FORMATION; BUSINESS; RIGHTS, POWERS AND AUTHORITY; STATUS ANDDURATION; PRINCIPAL OFFICE	1
ARTICLE III.	THE MANAGING MEMBER	2
ARTICLE IV.	MEMBERS	6
ARTICLE V.	INTERESTS	8
ARTICLE VI.	DISTRIBUTIONS TO AND WITHDRAWALS BY MEMBERS	14
ARTICLE VII.	CAPITAL ACCOUNTS; ALLOCATIONS	18
ARTICLE VIII.	RECORDS AND ACCOUNTING; REPORTS; CONFIDENTIALITY	21
ARTICLE IX.	EXCULPATION AND INDEMNIFICATION OF MANAGING MEMBER ASSOCIATES	25
ARTICLE X.	AMENDMENT; CONSENTS FOR OTHER PURPOSES	28
ARTICLE XI.	DISSOLUTION AND WINDING UP	30
ARTICLE XII.	MISCELLANEOUS	32

SECURED REAL ESTATE INCOME FUND II, LLC

LIMITED LIABILITY COMPANY OPERATING AGREEMENT

This Limited Liability Company Operating Agreement (this "Agreement") is entered into by and among SREIF MANAGER II, LLC, a Nevada limited liability company (the "Managing Member"), as the Managing Member of Secured Real Estate Income Fund II, LLC, a Delaware limited liability company (the "Company"), those members of the Company owning Membership Interests (as defined below) (each an "Investor" and collectively the "Investors"), and such other Persons who are admitted as Members of the Company or become Assignees of Interests in the Company, in each case pursuant to this Agreement.  This Agreement is effective commencing June 15, 2016.

ARTICLE I.

DEFINITIONS

Capitalized terms used in this Agreement have the meanings given them in ANNEX A.

ARTICLE II.

FORMATION; BUSINESS; RIGHTS, POWERS AND AUTHORITY; STATUS AND DURATION; PRINCIPAL OFFICE

2.1Formation. The Company has executed, or caused to be executed, the Certificate in a form that complies with Section 18-201 of the Act and filed, or caused to be filed, the Certificate in the office of the Secretary of State of the State of Delaware to form the Company under the Act.

2.2Business. The business of the Company is (a) to make Investments of the kind and nature described in the Company's Offering Circular, (b) managing, supervising and disposing of such Investments and (c) engaging in such other activities incidental or ancillary thereto as the Managing Member deems necessary or advisable to achieve the investment objective(s) of the Company.

2.3Rights, Powers and Authority. The Company shall possess every right, power, authority and privilege that a limited liability company formed under the Act may lawfully possess, and may exercise or invoke any such right, power, authority or privilege to the maximum extent permitted by law.

2.4Status and Duration.

(a) The Company is a separate legal entity whose existence commenced upon the filing of the Certificate and shall continue until the Certificate is canceled. The Liquidating Trustee shall cause the Certificate to be canceled at the time and in the manner prescribed by Section 18-203 of the Act.

(b) The existence shall commence upon the filing of the Certificate and continue until the completion of the winding up of the business and affairs in accordance with the provisions of Article XI.

2.5Principal Office. The Managing Member shall cause the Company to maintain its principal office in care of the Investment Manager at its offices at 2090 North Kolb Rd, Suite 120, Tucson 85715, or at such other place as the Managing Member may determine from time to time in its sole and absolute discretion. The Managing Member shall give Notification to the Members of any change in the location of the principal office of the Company no later than five (5) Business Days after the effective date of such change.

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ARTICLE III. THE MANAGING MEMBER

3.1Rights, Powers and Authority of the Managing Member.

(a)Subject only to the provisions of this Agreement and the requirements of applicable law:

(i)the Managing Member shall be the Manager of the Company and shall possess full and exclusive right, power and authority to manage and conduct the business and affairs of the Company; provided, however, that this Section 3.1(a)(i) shall not be construed to limit the Managing Member's right, power and authority to delegate, to the maximum extent permitted by law, any of the Managing Member's rights, powers and authority hereunder, with respect to the Company, to such Person or Persons as the Managing Member may select from time to time; and

(ii)in managing and conducting the business and affairs of the Company, the Managing Member: (A) shall take such actions and do such things as the Managing Member is expressly required to take or do under this Agreement with respect to the Company, as the case may be; (B) shall cause the Company to take such actions and do such things as the Company is expressly required to take or do under this Agreement; (C) may take, approve or agree to such actions, do such things, and make such designations, elections, selections and determinations as: (1) the Managing Member is expressly authorized, but not required, to take, approve, agree to, do or make under this Agreement; or (2) the Managing Member reasonably determines in good faith to be necessary, appropriate, advisable, incidental or convenient to the discharge of its duties under this Agreement; and (D) may cause the Company to take, approve or agree to such actions, do such things, and make such designations, elections, selections and determinations as: (1) the Managing Member is expressly authorized, but not required, to cause the Company to take, approve, agree to, do or make under this Agreement; or (2) the Managing Member reasonably determines in good faith to be necessary, appropriate, advisable, incidental or convenient to effect the formation of the Company or manage and conduct its business and affairs; provided, however, that:

(A)where any provision of this Agreement contemplates that the Managing Member may take, approve or agree to a particular action, do a particular thing, or make a particular designation, election, selection or determination (or may cause the Company to take, approve or agree to a particular action, do a particular thing, or make a particular designation, election, selection or determination), in the Managing Member's "sole and absolute discretion," the Managing Member shall have the sole discretion to determine whether or not the Managing Member (or the Company) shall take, approve or agree to such action, do such thing, or make such designation, election, selection or determination and, in exercising such discretion, the Managing Member shall be required to act in good faith but shall be entitled to consider only such interests and factors as it wishes, including only its own interests, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Company, or any Member or Assignee of any Member (except to the extent otherwise expressly provided in Section 3.4(b) and 6.1(a); and

(B)where any other provision of this Agreement contemplates that the Managing Member may take, approve or agree to a particular action, do a particular thing, or make a particular designation, election, selection or determination (or may cause the Company to take, approve or agree to a particular action, do a particular thing, or make a particular designation, election, selection or determination), the Managing Member shall have the sole discretion to determine whether or not the Managing Member (or the Company) shall take, approve or agree to such action, do such thing, or make such designation, election, selection or determination but, in exercising such discretion, the Managing Member shall be required to act in good faith and in such manner as it reasonably determines to be in, or not opposed to, the bests interests of the Company, and that otherwise complies with any specific standard applicable to such activity as set forth herein.

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(b)Subject to Section 3.1(a), the Managing Member may, by way of example and

not of limitation, cause the Company to:

(i)execute and acknowledge such certificates, instruments and other documents (and amendments thereto) as the Managing Member may determine, and file the same with Governmental Entities, for the purpose of effecting and continuing the valid existence of the Company as a limited liability company or qualifying the Company (or to do business as) a limited liability company or a company in which Members and Assignees have limited liability;

(ii)execute, deliver and perform such contracts, agreements, undertakings and instruments (and amendments thereto) as the Managing Member may determine, with such broker-dealers banks, other financial institutions, investment managers, investment advisers, custodians, administrators, attorneys, accountants, auditors, record-keepers, appraisers, consultants, other service-providers and counterparties as the Managing Member may select from time to time, on such terms and subject to such conditions as the Managing Member may determine (including terms relating to compensation, exculpation, indemnification and termination), and regardless of whether such service-providers or counterparties are Managing Member Associates or Members or Assignees or have financial, business or other relationships with the Company, any Managing Member Associate or any Member or Assignee, including contracts, agreements, undertakings and instruments under which the Company retains investment managers to manage such portion of the assets of the Company as the Managing Member may commit to their investment discretion from time to time;

(iii)engage in any lawful transaction in any Financial Instrument;

(iv)register any Assets in the name of the Company or in the name of a nominee;

(v) register any Assets associated of the Company;

(vi)pay such costs and expenses as the Managing Member may determine;

(vii)initiate, defend, compromise, settle or submit to arbitration any legal or

contractual claim by or against the Company;

(viii)   otherwise engage in any and all lawful transactions and activities; and

(ix)form one or more subsidiaries and cause any such subsidiary to do anything the Managing Member is authorized to cause the Company to do.

(c)Notwithstanding any other provision of this Agreement, the Managing Member

may not cause the Company to compensate any Managing Member Associate except upon terms and conditions comparable to those that would be negotiated on an "arm's length" basis between unaffiliated parties for the type of service or transaction in question (it being understood and agreed that all payments or allocations to the Managing Member or any of its Affiliates described or referred to in this Agreement shall conclusively be presumed to meet that standard).

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3.2Duties of the Managing Member.

(a)Except as provided in Section 3.2(b), neither the Managing Member nor any other Managing Member Associate shall be required to devote its full time or any material portion of its time to the business and affairs of the Company.

(b)The Managing Member shall devote so much of its time to the business and affairs of the Company, and so much of its time to the business and affairs of the Company, as the Managing Member shall determine to be necessary to achieve the respective investment objective(s) of the Company; provided, however, that this Section 3.2(b) shall not be construed to limit the Managing

Member's right to dissolve the Company pursuant to the provisions of Section 11.1.

(c)The Managing Member or its Affiliates shall be responsible for all of its own operating costs and expenses as described or referred to herein, including, but not limited to salaries and compensation of its principals, managers and employees, office rents and other administrative operating costs.

(d) Except to the extent required by Section 3.2(c), the Managing Member shall not be required to discharge any duty under this Agreement that requires the payment of funds to any Person unless adequate funds of the Company, as the case may be, are readily available for that purpose.

(e)The Managing Member may not cause the Company to expend its funds to compensate third party placement agents, finders or other Persons for marketing Interests or otherwise introducing prospective investors to that Company unless such persons are licensed broker dealers or otherwise exempt from licensing requirements.  In no event will the assets of the Company be used to compensate placement agents, finders or other Persons for marketing Interests otherwise introducing prospective investors to the Company.

3.3Liabilities of the Managing Member Associates.

Except to the extent otherwise required by law, no Managing Member Associate shall be personally liable for: (a) the repayment, satisfaction or discharge of any debt, liability, obligation or commitment of the Company whether arising in tort, contract or otherwise; (b) the repayment, to any Class A Member or Assignee of the Company, of any Capital Contribution of such Class A Member or Assignee; or (c) any decrease in the value of any Capital Account of any Class A Member or Assignee of the Company.

3.4Capital Contributions of the Managing Member and Admission of Additional

Managers.

(a)The Managing Member or any other Managing Member Associate may (but in no event shall be required to) make one or more Capital Contributions to the Company at such time(s) and in such amount(s) as it may determine in its sole and absolute discretion.

(b)The Managing Member is the Manager of the Company. Subject to Section 3.4(d), the Managing Member, in its sole and absolute discretion, may cause the Company to admit one or more Persons (including one or more Affiliates of the Managing Member) as an additional Manager or Managers of the Company (each such Person, an "Additional Manager"), either in lieu of or in addition to the Managing Member.

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(c)In connection with causing the Company to admit an Additional Manager pursuant to Section 3.4(b), the Managing Member may amend this Agreement to provide that such newly admitted Additional Manager shall possess and may exercise any one or more of the rights, powers and authority possessed by the Managing Member hereunder with respect to the Company.

(d)If the admission of one or more Additional Managers to the Company pursuant to Section 3.4(b) would constitute an "assignment" of this Agreement by the Managing Member within the meaning of Section 202(a)(1) of the Advisers Act, the Managing Member may not effect such admission without: (a) giving Notification to the Class A Members (in the case of an admission of an Additional Manager to the Company), or to the Class A Members (in the case of an admission of an Additional Manager), no later than thirty (30) calendar days prior to the effective date of such admission, setting forth, in reasonable detail, all material facts relating to such admission; and (b) obtaining the Consent to such admission (in the case of an admission of an Additional Manager to the Company), or the Consent to such admission (in the case of an admission of an Additional Manager), prior to the effective date thereof.

3.5Compensation and Reimbursement of Costs and Expenses.

(a)The Managing Member shall receive an Asset Management Fee ("Asset Management Fee") in the amount of 2% per annum of the Capital Contributions, as adjusted from time to time.  The Asset Management Fee shall be paid monthly on the fifteenth (15) day of the month, or succeeding business day, commencing on the fifteenth (15^th) day (or succeeding business day) of the second month following the Initial Closing and on a monthly basis thereafter and shall be calculated as of the last day of the preceding month. Additionally, the Managing Member shall be entitled to distributions of Net Income as a Class B Member as set forth in Section 6.1.

(b)Subject to Section 3.1(c), to the extent any Managing Member Associate incurs any costs or expenses of any of the types described or referred to in Section 3.1(b)(vi), the Company shall reimburse such Managing Member Associate for such cost or expense (unless the Managing Member determines, in its sole and absolute discretion, that such Managing Member Associate shall bear such cost or expense without reimbursement).

(c)The Company shall reimburse the Managing Member for organizational and initial offering costs and expenses incurred by the Managing Member in an amount not to exceed $150,000.

3.6Activities of the Managing Member Associates; Conflicts of Interest.

In connection with the investment activities of the Company, the Managing Member shall employ the services of Good Steward Capital Management, Inc (the "Investment Manager") to assist in the identification, due diligence, acquisition, investment management and disposition of Company Assets.  Pursuant to the terms of the Investment Management Agreement, the Investment Manager will be entitled to receive certain fees and expenses, which shall be payable from the Managing Member's share of Net Income and directed to the Investment Manager.  Each Member and Assignee shall be deemed to have: (a) given full and informed consent to each action and practice involving an actual or potential conflict between the interests of the Managing Member and the Investment Manager, on the one hand, and any one or more of the Company, the Class A Members and the Assignees, on the other hand; and (b) agreed not to object to any such action or practice, and not to bring or participate in bringing any Proceeding against any the Managing Member, any Managing Member Associate, the Investment Manager or the Company, on the grounds that such action or practice involves or involved a breach of the fiduciary duty of loyalty on the part of the Managing Member or any other Managing Member Associate, if: (i) such action or practice is described in this Agreement; (ii) such action or practice was described in the Offering Circular (if any) relating in effect at the time such Class A Member was admitted as a Class A Member or at the time such Assignee became an Assignee; or (iii) the Managing Member has given Notification to the Class A Members, at least thirty (30) calendar days prior to taking such action or implementing such practice, setting forth, in reasonable detail, all material facts relating to such action or practice.

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3.7Reliance by Third Parties.

(a)Notwithstanding any limitation on any right, power or authority of the Managing

Member described herein, any Person dealing with the Company shall be entitled to assume that the Managing Member has full right, power and authority to cause the Company to exercise or invoke any right, power, authority or privilege that a limited liability company formed under the Act may lawfully exercise or invoke, and no Person dealing with the Managing Member or any other Managing Member Associate shall be obligated to ascertain that the provisions of this Agreement have been complied with or to inquire into the necessity or expedience of any action of the Managing Member or any other Managing Member Associate.

(b)Each and every certificate, instrument or other document executed on behalf of the Company  by the Managing Member shall be conclusive evidence in favor of each and every Person relying thereon or claiming thereunder that: (i) at the time of the execution and delivery of such certificate, instrument or document, this Agreement was in full force and effect; (ii) the Person executing and delivering such certificate, instrument or document was duly authorized and empowered to do so for and on behalf of the Company; and (iii) such certificate, instrument or other document was duly executed and delivered in accordance with this Agreement and is binding upon the Company.

3.8Borrowings.

(a)The Managing Member may, with the approval of the Class A Members, on behalf of the Company, secure loans, lines of credit or enter into one or more agreements for lines of credit and other debt financings, which may include lines of credit secured by all or a portion of the Company's Investments and other assets.

3.9Resignation.  The Managing Manager may resign as manager upon no less than thirty (30) days prior written notice to the Class A Members.

3.10Vacancies.  Each vacancy of the manager shall be filled by the vote of the Class A Members holding a majority of the Class A Interests.  A manager elected to fill a vacancy shall be elected to serve until such manager's successor is duly elected and qualified, or until such manager resigns.

ARTICLE IV. MEMBERS

4.1Class A Members Have Limited Personal Liability.

(a)Except as otherwise required by law or as contemplated by Section 4.1(c), no Class A Member or Assignee, in its capacity as such, shall be personally liable to any Person for the debts, liabilities, obligations or commitments of the Company, whether arising in tort, contract or otherwise; provided, however, that this Section 4.1(a) shall not be construed to limit the obligations of Class A Members and Assignees under Sections 5.1(c) and 5.4(d).

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(b)Except as otherwise required by law, no Class A Member or Assignee, in its capacity as such, shall be responsible for: (i) the losses of the Company, except to the extent of such Class A Member's or Assignee's Capital Account in the Company; (ii) the repayment, to any other Class A Member or Assignee, of any Capital Contribution of such other Class A Member or Assignee; (iii) any decrease in the value of any Capital Account of any other Class A Member or Assignee,  the repayment, to any Class A Member or Assignee, of any Capital Contribution of such Class A Member or Assignee; or (iv) any decrease in the value of any Capital Account; provided, however, that this Section 4.1(b) shall not be construed to limit the obligations of Class A Members and Assignees under Sections 5.1(c).

(c)Notwithstanding the provisions of Section 4.1(a), if the Company incurs a withholding tax or other tax obligation with respect to the share of income allocable to any Capital Account, and if the amount of any such obligation exceeds the balance of such Capital Account, then the Class A Member or Assignee that holds such Capital Account must, upon demand by the Managing Member, pay to the Company, as a Capital Contribution, an amount equal to such excess.

(d)None of the Company, the Company or any Managing Member Associate is obligated to apply for or obtain a reduction of or exemption from any applicable withholding tax on behalf of any Member or Assignee of the Company.

4.2Authority of Class A Members Is Limited.

(a)No Class A Member or Assignee, in its capacity as such, shall: (i) take part in the management or conduct of the business or affairs of the Company, or act, or transact any business, in the name of or otherwise for or on behalf of the Company; (ii) have the right, power or authority to execute documents for, incur any indebtedness or expenditures on behalf of or otherwise bind the Company in connection with any matter; or (iii) have the right, power or authority to authorize, approve, agree or consent to, or vote on, any matter affecting the Company, except to the extent any such right, power or authority is expressly granted to such Class A Member or Assignee by this Agreement or by provisions of the Act that may not lawfully be modified or nullified by agreement among the members of a limited liability company formed under the Act. Wherever this Agreement provides that the Managing Member may take, approve or agree to a particular action, do a particular thing, or make a particular designation, election, selection or determination (or cause the Company to take, approve or agree to a particular action, do a particular thing or make a particular designation, election, selection or determination), and such case does not expressly require Class A Member or Assignee authorization, approval, agreement or consent or the vote of Class A Members or Assignees, the Managing Member shall possess full right, power and authority to take, approve or agree to such action, to do such thing, or to make such designation, election, selection or determination (or to cause the Company to take, approve or agree to such action, do such thing or make such designation, election, selection or determination), without obtaining any prior or subsequent authorization, approval, agreement, consent or vote of any Class A Member or Assignee.

(b)To the extent permitted by law, the Managing Member, in its sole and absolute

discretion, may cause the Company to enter into an agreement with any Class A Member or Assignee whereby such Class A Member or Assignee agrees to waive any or all of such Class A Member's rights, powers and authority to authorize, approve, agree or consent to, or vote on, any matter or matters affecting the Company.

4.3Class A Members May Not Partition Assets. No Class A Member or Class A Members, or Assignee or Assignees, individually or collectively, shall have any right, title or interest in or to specific Assets or specific assets associated with the Company. Each Class A Member and Assignee irrevocably waives any right that it may have to maintain an action for partition with respect to its Interest, any Assets or any assets associated with the Company.

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4.4Class A Members May Not Remove or Expel Managing Member. No Class A Member or Class A Members, or Assignee or Assignees, individually or collectively, shall have any right, power or authority to remove or expel the Managing Member as a Manager of the Company or as a Manager or Class A Member of the Company, to cause the Managing Member to withdraw as a Manager of the Company or as a Manager or Class A Member of the Company, or to appoint a successor Manager of the Company in the event of Bankruptcy of the Managing Member except for "cause" and with the affirmative vote of two-thirds of the Members.  Cause shall be defined as any of the following:

(a) the Managing Member's continued breach of any material provision of the operating agreement following a period of 30 days after written notice thereof (or 45 days after written notice of such breach if the Managing Member, under certain circumstances, has taken steps to cure such breach within 30 days of the written notice);

(b) the commencement of any proceeding relating to the bankruptcy or insolvency of the Managing Member, including an order for relief in an involuntary bankruptcy case or the Managing Member authorizing or filing a voluntary bankruptcy petition;

(c) the Managing Member commits fraud against the Company, misappropriating or embezzling the Company's funds, or acting, or failing to act, in a manner constituting bad faith, willful misconduct, gross negligence or reckless disregard in the performance of its duties under the operating agreement; provided, however, that if any of these actions is caused by an employee, personnel and/or officer of the Managing Member or one of its affiliates and the Managing Member (or such affiliate) takes all necessary and appropriate action against such person and cures the damage caused by such actions within 30 days of the Managing Member's actual knowledge of its commission or omission, then the Managing Member may not be removed; or

(d) the dissolution of the Managing Member.

Unsatisfactory financial performance of the Company does not constitute "Cause" under this Agreement.

4.5 Capital Contributions.

(a)Each Class A Member shall make contributions of capital to the Company in accordance with this Agreement and the terms and conditions of each Class A Member's respective Subscription Agreement.   In connection with the making of a capital contribution, each Class A Member shall have executed and delivered such instruments and shall have taken such actions as the Managing Member shall deem necessary or desirable to effect such admission, including, without limitation, the execution of a Subscription Agreement and a counterpart of this Agreement.

(i)Each Class A Member will be required to contribute not less than $5,000 to the Company for the purchase of Interests, although the Managing Member may elect to accept less in its sole discretion.

(ii)Each Class A Member shall contribute its Capital Contributions to the Company, by check or by wire transfer of immediately available funds, and in the case of a wire transfer, to the bank account of the Company as shall be designated by the Member at the closing of the purchase of such Class A Member's Interests.

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(b) Closings.

(i)The Initial Closing shall occur on the first day in which the Company receives Capital Contributions in the aggregate amounts equal to or exceeding the Minimum Capital Amount for the purchase of Interests.

(ii)Subsequent closings (together with the Initial Closing, each a "Closing") shall be held thereafter until the final closing ("Final Closing"), which shall be upon receipt of Capital Contributions in an amount equal to the Target Investment Amount; however, the Managing Member may elect to have the Final Closing prior to such time in its sole discretion, provided the Minimum Investment Amount has been received.

(c) Admissions of Additional Members.

(i)The Managing Member may, in its sole discretion, schedule one or more Subsequent Closings for such Person or Persons seeking admission to the Company as an additional Member of the Company and an owner or a Member wishing to purchase additional Interests in the Company, subject to the determination by the Managing Member in the exercise of its good faith judgment that, in the case of each such admission or increase, the following conditions have been satisfied:

(ii)The Member shall have executed and delivered such instruments and shall have taken such actions as the Managing Member shall deem necessary or desirable to effect such admission or increase, including, without limitation, the execution of a Subscription Agreement and a counterpart of this Agreement.

ARTICLE V. INTERESTS

5.1General Attributes of Interests.

(a)The limited liability company interests in the Company shall consist exclusively

of Interests in the Company. The Interests shall be divided into two (2) classes, the Class B Interests, which shall be held exclusively by the Managing Member and the Class A Interests which shall be held by the Class A Members. Interests shall be deemed to be personal property giving only the rights, powers, authority, privileges and preferences provided in this Agreement, notwithstanding the nature of the property held by the Company.

(b)The relative rights, powers, authority, privileges, preferences, duties, responsibilities, liabilities and obligations applicable to such Interests and such Class A Members and Assignees as are otherwise set forth in this Agreement.

(c)Each Interest, when issued and fully paid for in accordance with the provisions of the related Subscription Agreement, shall be fully paid and nonassessable, and, subject to Section 4.1(c), neither the Company, nor any officer, employee or agent of the Company, shall have the right, power or authority to call upon a Class A Member or Assignee to pay any sum of money whatsoever in respect of such Class A Member's or Assignee's Interest, whether in the form of a Capital Contribution, a loan or otherwise, other than that which such Class A Member or Assignee has agreed to pay by way of such Subscription Agreement or has otherwise expressly agreed to pay. However, each Person shall be liable to return to the Company amounts previously distributed to it as follows:

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(i)A Person who receives any amount distributed in violation of Section 18-607(a) of the Act shall be liable for the return of such amount, together with interest thereon from the date of such distribution at a floating rate determined by the Managing Member, notwithstanding that such Person had no knowledge of such violation at the time of its receipt of such amount. Subject to the provisions of Section 18-502(b) of the Act, the Managing Member may compromise or waive any such liability on such terms and subject to such conditions as the Managing Member may determine. This Section 5.1(c)(i) shall not apply to distributions made pursuant to Article XI.

(ii)A Person who receives any amount distributed in violation of Section 18-804(a) of the Act shall be liable for the return of such amount, together with interest thereon from the date of such distribution at a floating rate determined by the Liquidating Trustee, notwithstanding that such Person had no knowledge of such violation at the time of its receipt of such amount. Subject to the provisions of Section 18-502(b) of the Act, the Liquidating Trustee may compromise or waive any such liability on such terms and subject to such conditions as the Liquidating Trustee may determine.

(iii)A Person who receives any amount distributed in excess of the amount to which such Person was entitled under this Agreement because the value of the Net Asset Value attributable to such Person's Capital Account was overestimated or miscalculated for any reason (irrespective of whether the event or circumstance giving rise to such overestimation or miscalculation was known or unknown to the Managing Member or such Person at the time of such distribution), shall be liable for the return of such amount, together with interest thereon from the date of such distribution at a floating rate determined by the Managing Member.

(iv)Without limiting the scope of Section 5.1(c)(iii), the Managing Member may determine to treat any expenditure that is incurred, or any liability  that becomes known or fixed, after the Accounting Period in which the event or circumstance (whether known or unknown) giving rise to such expenditure or liability occurred (the "Prior Accounting Period") as either (i) arising in the Accounting Period in which such expenditure is incurred or such liability becomes known or fixed or (ii) arising in such Prior Accounting Period, in which later case the Persons who were Class A Members or Assignees as of the beginning of such Prior Accounting Period shall be liable for such expenditure or liability on a pro rata basis in accordance with the Opening Balances of their Capital Accounts as of the beginning of such Prior Accounting Period (regardless of whether such Persons are Class A Members or Assignees during the Accounting Period in which such expenditure is incurred or such liability becomes known or fixed), together with interest thereon from the date such expenditure is incurred or such liability becomes known or fixed, at a floating rate determined by the Managing Member.

(v)Subsequent to the completion of the winding up of the business and affairs, each Class A Member, Assignee and former Class A Members or Assignees shall remain liable (for the time period set forth in Section 9.2(h))in an aggregate amount not to exceed such Person's aggregate Capital Withdrawals, to the extent necessary to enable the Company to satisfy its Indemnification Obligations.

(d)The Managing Member shall, to the extent necessary to settle the liabilities of a Person to the Company under Section 5.1(c), either adjust the Capital Account(s) of the appropriate Person(s) downward, or cause the Company to request payments from the appropriate Person(s), to reflect amounts due from such Person(s) (and in either event make corresponding upward pro rata adjustments to the other Capital Accounts); provided, however, that the Managing Member shall not be required to make any such downward adjustment or request for payment (or corresponding upward adjustment) unless failure to do so would have a material adverse effect on the Company. It shall be conclusively presumed that any failure to make any such downward adjustment or request for payment in respect of a particular Class A Member or Assignee shall not have a material adverse effect on the Company if the amount in question in respect of such Class A Member or Assignee is less than one percent (1%) of the amount of Net Asset Values of the Company at the time contemplated for such adjustment or request. If the Managing Member requests such a payment from a Person and such Person does not comply with such request, the Managing Member shall determine whether to cause the Company to institute a Proceeding against such Person to recover the amount requested.

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(e)If a Person receives a distribution in an amount less than the amount to which such Person was entitled under this Agreement because the value of the Net Asset Value attributable to such Person's Capital Account was underestimated or miscalculated for any reason (irrespective of whether the event or circumstance giving rise to such underestimation or miscalculation was known or unknown to the Managing Member or such Person at the time of such distribution), the Managing Member, in its sole and absolute discretion, may: (i) cause the Company to pay the amount of such difference to such Person, together with interest thereon from the date of such distribution at a floating rate determined by the Managing Member; or (ii) adjust the Capital Account of such Person upward to reflect: (A) the amount due such Person plus (B) interest thereon from the date of such distribution at a floating rate determined by the Managing Member (and, in either case, make corresponding downward pro rata adjustments to the other Capital Accounts).

5.2Issuance and Sale of Interests.

(a)After the date of this Agreement, the Company shall not admit any Person as a

Class A Member unless such admission is effected in accordance with Section 5.2(b) or Section 5.4(b)(ii)(A).

(b)The Managing Member is authorized to cause the Company to offer, sell and issue Interests on an ongoing basis, and to admit Persons as Class A Members, in one or more Closing each held on the first day of each month on a monthly basis in such manner and at such time or times as the Managing Member may determine, except that the Managing Member may not cause the Company to offer, sell or issue Interests in the Company in a manner inconsistent with this Agreement or the Offering Circular (if any) relating in effect at the relevant time, or to any Person who has failed to execute a Subscription Agreement or other document under which such Person has agreed to be bound by the provisions of this Agreement as a Member of the Company.

(c)The Managing Member may accept or reject any Subscription Agreement, or accept or reject all or any portion of a Person's proposed Capital Contribution under such Person's Subscription Agreement, in its sole and absolute discretion.

(d)Each Person whose Subscription Agreement has been accepted by the Managing Member shall, to the extent the Managing Member has agreed to accept a Capital Contribution under such Subscription Agreement, make such Capital Contribution in cash in immediately available funds (unless the Managing Member agrees in its sole and absolute discretion to accept such Capital Contribution in the form of property other than cash) at the time(s) and place(s) set forth in such Subscription Agreement or in a Notification given to such Person pursuant to such Subscription Agreement; provided, however, that subject to the provisions of Section 18-502(b) of the Act, the Managing Member may compromise or waive any obligation a Person may have under such Person's Subscription Agreement (including an obligation to make a Capital Contribution) or otherwise, on such terms and subject to such conditions as the Managing Member may determine.

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(e)If the Managing Member accepts a Person's Subscription Agreement, it shall (subject to the provisions of Section 5.4) cause the books and records of the Company to reflect the admission of such Person as a Class A Member of the Company in accordance with the terms of such Person's Subscription Agreement.

(f)A Person who has been admitted as a Class A Member and who wishes to make an additional Capital Contribution not required to be made under such Person's Subscription Agreement may do so only upon the approval of the Managing Member. The Managing Member may withhold such approval in its sole and absolute discretion.

5.3Ownership of Interests. The Managing Member shall cause the ownership of Interests

to be recorded on separate and distinct books and records of the Company. The Company shall not issue certificates certifying the ownership of Interests therein.

5.4Transfers of Interests.

(a)Restrictions on Transfer. No Class A Member or Assignee may Transfer an Interest (or any interest therein) unless: (i) the Managing Member, in its sole and absolute discretion, has approved such Transfer; (ii) in the case of a Class A Member or Assignee that is a natural person, such Class A Member or Assignee dies or a court of competent jurisdiction adjudges him to be incompetent to manage his person or his property, in which case such Interest shall be Transferred automatically to the Personal Representative of such Class A Member or Assignee; or (iii) such Transfer arises by operation of the provisions of Section 18-703(a) of the Act.

(b)Duties and Liabilities of Transferors and Transferees.

(i) Duties and Liabilities of Transferors.

(A)If a Person Transfers an Interest (or an interest therein), such Person or its transferee shall, upon the Managing Member's request, reimburse the Company for any legal, accounting and other costs and expenses the Company incurs in connection with such Transfer, including costs and expenses associated with reviewing such Transfer for compliance with this Section 5.4 and applicable law.

(B)In the case of a proposed Transfer of an Interest of the type described in Section 5.4(b)(i), the transferee or the transferor of such Interest (or interest therein) shall, upon the request of the Managing Member and at such Person's sole cost and expense, either cause the Company to be provided with, or authorize the Company obtain, a legal opinion, in form and substance acceptable to the Managing Member and rendered by legal counsel acceptable to the Managing Member, to the effect that such proposed Transfer is exempt from or not subject to the registration requirements of the 1933 Act and any applicable state securities laws.

(C)In the case of any Transfer of an Interest (or any interest therein), the transferor or transferee of such Interest (or interest therein) shall, upon the request of the Managing Member and at such Person's sole cost and expense, either cause the Company to be provided with, or authorize the Company to obtain, a legal opinion, in form and substance acceptable to the Managing Member and rendered by legal counsel acceptable to the Managing Member, to the effect that the Transfer will not result in: (1) the termination of the Company as a partnership for federal income tax purposes or (2) the Company being treated as a "publicly traded partnership" within the meaning of Section 7704 of the Code and applicable Treasury Regulations.

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(D)Unless the Managing Member expressly agrees otherwise in its

sole and absolute discretion, no Transfer of an Interest (or any interest therein) shall relieve the transferor

of its duties, liabilities and obligations under this Agreement.

(ii) Rights, Duties and Liabilities of Transferees.

(A)No Person to whom a Transfer of an Interest (or an interest therein) has been made (an "Assignee"), including a Personal Representative to whom a Transfer of an Interest is made pursuant to Section 5.4(b)(ii), shall be entitled to be admitted to the Company as a Class A Member or to exercise any of the rights, powers or authority of a Class A Member, unless the Managing Member approves thereof. The Managing Member may withhold such approval in its sole and absolute discretion.

(B)Prior to the admission of an Assignee  as a Class A Member of the Company pursuant to Section 5.4(b)(ii)(A): (1) such Assignee shall be entitled only to share in such increases and decreases in the Net Asset Value, to receive such distributions from the Company and to receive such allocations of the Tax Items, as the transferor would have been entitled to share and receive in respect of the Interest or interest therein Transferred by such transferor to such Assignee (provided that such Assignee shall have provided the Company such Assignee's taxpayer identification number and such other information as may be reasonably requested by the Managing Member to enable the Company to comply with the Code and other applicable law and with the provisions of Section 8.5(a)); (2) such Assignee shall have no other rights, powers or authority in or with respect to the Company, except such rights, powers and authority as are expressly conferred on an Assignee by this Agreement; and (3) the transferor of such Interest or interest therein shall retain all rights, powers and authority pertaining thereto to the extent such rights, powers and authority do not vest in such Assignee pursuant to clause (1) of this Section 5.4(b)(ii)(B).

(C)An Assignee admitted as a Class A Member pursuant to Section 5.4(b)(ii)(A) shall, to the extent of the Interest transferred to such Assignee, succeed to all of the rights, powers and authority of the transferor Class A Member under this Agreement in the place and stead of such transferor Class A Member, except to the extent the Managing Member (in its sole and absolute discretion) and such Assignee expressly agree otherwise.

(D)Unless the Managing Member expressly agrees otherwise in its sole and absolute discretion, notwithstanding any provision of Section 18-704(b) of the Act, any Assignee

to whom an Interest (or an interest therein) is Transferred, whether or not such Assignee is admitted as a Member, shall, to the extent of such Interest (or interest therein), succeed to the duties, obligations and liabilities of the transferor under this Agreement.

(c)Effective Dates of Transfers.

(i)Transfers of Interests (or interests therein) pursuant to this Section 5.4 may be made on any day, but for purposes of this Agreement, a Transfer shall be deemed to occur at the beginning of the Accounting Period during which such Transfer occurs, if such Transfer occurs on or prior to the fifteenth (15th) day of such Accounting Period, or at the beginning of the Accounting Period immediately following the Accounting Period during which such Transfer occurs, if such Transfer occurs after the fifteenth (15th) day of an Accounting Period, or at such other time determined by the Managing Member pursuant to such convention as may be administratively feasible and consistent with applicable law.

(ii)All distributions pursuant to this Agreement attributable to a Transferred

Interest (or interest therein): (A) with respect to which the distribution record date determined by the Managing Member is before the date such Transfer is deemed to occur, shall be made to the transferor, and (B) with respect to which the distribution record date determined by the Managing Member is on or after the date such Transfer (other than a pledge, encumbrance, hypothecation or mortgage) is deemed to occur, shall be made to the transferee.

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(iii)If any Interest (or an interest therein) is deemed to be Transferred on any day other than the first day of a calendar year, then each Tax Item attributable thereto for such year shall be allocated to the transferor and the transferee by taking into account their varying interests during such year in accordance with Section 706(d) of the Code, using any method permitted thereunder selected by the Managing Member.

(d)Effect of Non-Complying Transfers. Any Transfer of any Interest (or interest therein) in breach of this Section 5.4, and any Transfer that has (or, in the Managing Member's judgment, is likely to result in) an Adverse Regulatory Effect, shall be wholly null and void and shall not effectuate the Transfer contemplated thereby. The Company shall have the right to obtain injunctive relief (in addition to and not in lieu of any other remedies available to either or both of them) in the event of: (i) any breach or threatened breach of this Section 5.4; or (ii) any Transfer that has (or, in the Managing Member's judgment, is likely to result in) an Adverse Regulatory Effect. Any Person who Transfers an Interest (or an interest therein) in breach of this Section 5.4 shall reimburse the Company for all costs and expenses reasonably incurred by the Company in enforcing this Section 5.4 with respect to such Transfer.

5.5Expenses.  The Company generally will bear all costs and expenses associated with the initial setup of the Company and the offering of Interests and its ongoing operations, except as otherwise described in this Offering Circular. The Company's ongoing operational costs and expenses consist primarily of: (i) costs and expenses incurred in connection with the ongoing offer and sale of Interests; (ii) costs and expenses incurred by the Managing Member or Investment Manager in connection with investigating investment opportunities for the Company and reviewing the continuing suitability of the Company's investments in light of the Company's investment objectives; (iii) costs and expenses incurred in connection with the investment and reinvestment of the Company's assets, including purchase prices, commissions, mark-ups, mark-downs and spreads, and related clearing and settlement charges; (iv) Management Fees, custodial, administrative, legal, accounting, auditing, record-keeping, appraisal, tax form preparation, compliance and consulting costs and expenses (including costs and expenses associated with obtaining systems and other information designed to facilitate Company accounting or record-keeping, including related hardware and software); (v) fees, costs and expenses of third-party service providers that provide such services (including fees, costs and expenses of attorneys retained by the Managing Member or the Investment Manager to represent the Managing Member or Investment Manager, as applicable, in connection with the business and affairs of the Company, to the extent such fees, costs and expenses relate to advice provided to the Managing Member or Investment Manager by such attorneys with respect to such business and affairs); (vi) acquisitions fees, servicing fees, administrative fees, disposition fees and other fees related to the Company assets; (ix) insurance costs and expenses; (x) bank service fees; (xi) costs and expenses associated with preparing investor communications; (xii) printing and mailing costs and expenses; (xiii) fees and taxes imposed by any governmental entity or self-regulatory organization, including licensing, filing, registration and exemption fees and withholding, transfer and franchise taxes; (xiv) the Company's indemnification obligations under the Operating Agreement, the IMA and other agreements to which the Company may be a party; and (xv) extraordinary costs and expenses, if any. The Managing Member and Investment Manager shall be responsible for their respective overhead costs and expenses, including, but not limited to, salaries and office rental fees.

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ARTICLE VI.  DISTRIBUTIONS TO AND WITHDRAWALS BY MEMBERS

6.1Distributions of Net Income.

(a)Subject to Section 6.1(b) below, the Company shall distribute Net Income received with respect to the assets to the relevant Class A Members, subject to any Reserves or Company expenses as reasonably determined by the Managing Member. The Company shall make all such distributions of Net Income to the Class A Members and Class B Members in the following order of priority, and among them in accordance with their respective Class Percentages:

(i)first, to the Class A Members until the total amount distributed to them

pursuant to this Section 6.1(a)(i) equals the amount of their unpaid Class A Preferred Return;

(ii)next, to the Managing Member until the amount distributed pursuant to this Section (ii) equals two percent (2%) of the amount distributed to the Class A Members pursuant to Section 6.1(a)(i);

(iii)the remaining Net Income shall be distributed (a) eighty percent (80%) to the Class A Members and (b) twenty percent (20%) to the Managing Member as its "Carried Interest".

(b)Commencing on the fifteenth (15^th) day (or succeeding business day) of the second month following the date of a Closing of the purchase of Interests by a Class A Member and on the fifteenth (15^th) day (or succeeding business day) of each month thereafter, the Class A Member will be entitled to receive distributions in an amount equal to one-twelfth (1/12) of the Class A Preferred Return under Section 6.1(a)(i), prorated as applicable for the amount of time that a Member was a member of the Fund during such month.

(c)Commencing at the end of the second quarter following the Initial Closing and on a quarterly basis thereafter, the Managing Member shall cause the Company to make distributions of Net Income as set forth in Section 6.1(a)(iii) (together with the payments under Section 6.1(b), the "Regular Income Distributions").  At the end of each year, the Managing Member shall cause the Company to make such additional distributions as required under clause under Section 6.1(a)(iii) above. Notwithstanding the foregoing and subject to Section 6.3, the Managing Member plans to retain the principal portion of each Member's Capital Contribution and any income with respect thereto in excess of the amounts distributed to the Members in accordance with items (i) through (iii) of Section 6(a) above, for reinvestment by the Managing Member on behalf of such Members.  In addition, the Managing Member may retain any Net Income from the Company's assets, if the Managing Member determines in its discretion that such proceeds or income is needed to manage the Company's liquidity positions or for risk management purposes, whether or not any formal reserve is established in connection therewith.

(d)Unless a Member elects to have such amounts reinvested, all cash in the form of quarterly distributions and monthly Preferred Returns will be distributed to the Members.  An election to reinvest the quarterly income distribution or monthly Preferred Return is revocable at any time upon a written request to revoke such election.  If no election is made, then the quarterly income distribution and Preferred Return will be distributed to the Members.  Members may change their election at any time upon ninety (90) days written notice to the Fund.  Upon receipt and after the ninety (90) day notice has occurred, the Member's election shall be changed and reflected on the following first day of the successive calendar quarter in which the Member is entitled to receive a distribution.  Notwithstanding the preceding sentences, the Managing Member may at any time immediately commence with income distributions in cash only (hence, suspending the reinvestment option for such Member(s) to any Member(s) in order for the Fund to remain exempt from the ERISA plan asset regulations.  (See "ERISA Considerations" and "Summary of Company Agreement" below).  In addition, the Managing Member may elect to redeem all or a part of a Member's Interests for any reason upon thirty (30) days written notice to the Member at a price equal to the Member's capital contribution plus any accrued but unpaid Preferred Return and other fees which owed to the Member on the date of redemption.   The Managing Member may also, by notice to a Member, force the sale of all or a portion of such Member's Interest on such terms as the Managing Member determines to be fair and reasonable, or take such other action as it determines to be fair and reasonable in the event that the Managing Member determines or has reason to believe that: (i) such Member has attempted to effect a transfer of, or a transfer has occurred with respect to, any portion of such Member's Interest in violation of the Operating Agreement; (ii) continued ownership of such Interest by such Member is reasonably likely to cause the Company to be in violation of securities laws of the United States or any other relevant jurisdiction or the rules of any self-regulatory organization applicable to the Managing Member or its affiliates; (iii) continued ownership of such Interest by such Member may be harmful or injurious to the business or reputation of the Fund or the Managing Member, or may subject the Company or any Members to a risk of adverse tax or other fiscal consequence, including without limitation, adverse consequence under ERISA; (iv) any of the representations or warranties made by such Member in connection with the acquisition of such Member's Interest was not true when made or has ceased to be true; or (v) such Member's Interest has vested in any other person by reason of the bankruptcy, dissolution, incompetency or death of such Member.

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(e)No Class A Member has any right to demand and receive any distribution in a form other than cash. All distributions of cash or property (distributions in kind) shall be made at such time and in such manner as is determined by the Managing Member. All amounts withheld pursuant to the Code or any provisions of state or local tax law with respect to any payment or distribution to the Members from the Company shall be treated as amounts distributed to the relevant Class A Member pursuant to this Section 6.1.

6.2Withdrawals by Members from Capital Accounts. No Class A Member or Assignee shall be entitled to withdraw capital from its Capital Account except with the consent of the Managing Member, which consent may be withheld for any reason or no reason.

6.3Voluntary Withdrawal of Members and Withdrawal Payments. No Class A Member or Assignee shall have the right to resign or withdraw except with the approval of the Managing Member and shall not receive a distribution of the principal portion of all or part of its Capital Contribution in redemption of such Class A Member's Interest ("Capital Withdrawal") except as set forth below:

(a)Capital Withdrawals are subject to an initial eighteen (18) month lock-up period ("Lock-Up Period") from the date of Closing of a purchase of Interests by a Class A Member, and no Capital Withdrawals will be made by a Class A Member at any time prior to the end of the Lock-Up Period; provided, however, the Managing Member may, in its sole discretion, allow the redemption of a Class A Member's investment prior to the expiration of the applicable Lock Up Period subject to a discretionary withdrawal penalty equal to five percent (10%) of the amount of the Capital Withdrawal ("Early Withdrawal Fee").  The Early Withdrawal Fee shall be payable to the Company and considered earned by the remaining Members;

(b)A Class A Member seeking to redeem all or a portion of its Interests shall provide the Managing Member with written notice of its election to redeem its Interests no less than ninety (90) days prior to the date in which the requested Capital Withdrawal be made;

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(c)Subject to Section 6.3(d) Capital Withdrawals shall at no time exceed twenty-five percent (25%) of a Member's total Capital Account balance during any three (3) month period and the Company shall only be required to distribute 25% of such Member's total Capital Account balance in any three (3) month period;

(d)The Company is not obligated to redeem Class A Interests and may limit the number of Class A Interests to be redeemed during any calendar year to 10.0% of the weighted average number of Class A Interests outstanding during the prior calendar year (or 2.5% per quarter, with excess capacity carried over to later quarters in the calendar year);

(e)Capital Withdrawals shall be based upon a Class A Member's Capital Account Balance at the time such Capital Withdrawal is made;

(f)the Managing Member reserves the right to deny, suspend or modify any Capital Withdrawals or any redemption request if the Manager, in its sole discretion, believes that the Company does not have sufficient liquidity to honor such request or if the Managing Member believes such distribution to be contrary to the best interest of the Company or the non-withdrawing Members, to prevent an undue burden on the Company's liquidity, to preserve or facilitate the Company's tax status, following any material decrease in the Company's NAV, or for any other reason. The Managing Member may also, in its sole discretion, decline any particular redemption request if it believes such action is necessary to preserve or facilitate the Company's tax status;

(g)except as modified by the Managing Member, Capital Withdrawals will be made in the order of request; provided, however, the Managing Member shall be under no obligation to liquidate loans or sell assets of the Company out of the ordinary course of business specifically to meet any Capital Withdrawal request.  If one or more requests for redemption are made in the same month, those Capital Withdrawals will be made pro-rata as liquidity becomes available and not on a first come / first serve basis (unless otherwise elected by the Managing Member);

(h)in the event that the date upon which a Capital Withdrawal is to be made falls upon any day other than the first day of a month, then the Class A Member shall not be entitled to receive an allocation of Net Income under Section 6.1 with respect to the redeemed Interests for the period between the first day of the month in which the Capital Withdrawal takes place and the actual date in which the Capital Withdrawal is made; and

(i)each Class A Member seeking redemption shall complete a Redemption Notice substantially as set forth on Exhibit A.

6.4Involuntary Withdrawal of Members.

(a)The Managing Member may at any time require any Class A Member or Assignee to withdraw all or any portion of its Capital Account, or withdraw as a Class A Member or Assignee, in either case without notice to such Class A Member or Assignee, if: (i) the Managing Class A Member determines that such Class A Member or Assignee made a material misrepresentation to the Company in connection with acquiring its Interest or is unable to perform its obligations under this Agreement; (ii) a Proceeding is commenced or threatened against the Company, any other Class A Member or Assignee, arising out of, or relating to, such Class A Member's or Assignee's investment in the Company; (iii) such Class A Member or Assignee Transferred such Interest (or any interest therein) in violation of Section 5.4 or in a manner that has resulted in (or, in the Managing Member's judgment, is likely to result in) an Adverse Regulatory Effect; or (iv) such Class A Member's or Assignee's ownership of such Interest (or any interest therein) has resulted in (or, in the Managing Member's judgment, is likely to result in) an Adverse Regulatory Effect.

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(b)Any Class A Member or Assignee who is required to withdraw an amount from its Capital Account or to withdraw as a Class A Member or Assignee pursuant to this Section 6.4 shall withdraw from its Capital Account the amount such Class A Member or Assignee is required to withdraw, as specified by the Managing Member.

6.5Compulsory Redemptions

(a)The Company may also compulsorily redeem all or part of a Class A Member's Interests at any time and for any reason in the sole discretion of the Managing Member upon thirty (30) days written notice to the Class A Member at a price equal to the Class A Member's capital contribution plus any accrued but unpaid Preferred Return and other income which is owed to the Class A Member on the date of redemption. In addition, the Managing Member may immediately expel a Class A Member for cause if (i) the Class A Member has materially breached or is unable to perform the Class A Member's material obligations under this Agreement, (ii) a proceeding is commenced or threated against the Company arising out of a Class A Member's investment in the Company, or (iii) such ownership has resulted in an adverse effect. A Class A Member's expulsion from the Company will be effective upon the Class A Member's receipt of written notice of the expulsion by the Company.

6.6Status After Withdrawal.

(a)A Person who is permitted or required to resign or withdraw as a Class A Member or Assignee pursuant to this Agreement shall have no rights against the Company; provided, however, that this Section 6.6(a) shall not be construed to limit a former Member's or Assignee's right (subject to the limitations contained in Articles IX and XII) to bring any Proceeding against the Company any Managing Member Associate or any Liquidating Trustee Associate.

(b)A Person who is permitted or required to resign or withdraw as a Class A Member or Assignee pursuant to the provisions of this Agreement shall continue as a Class A Member or Assignee, as the case may be, until the effective date of such resignation or withdrawal, but not thereafter, notwithstanding that withdrawal proceeds are not paid to such Person until after the effective date of such resignation or withdrawal.

6.7Legal Restrictions on Capital Withdrawals. Notwithstanding any other provision of this Agreement, no Capital Withdrawal shall be made to the extent that, after giving effect to such withdrawal, the Company would be in violation of Section 18-607(a) or Section 18-804(a) of the Act.

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6.8Withholding from Capital Withdrawals. The Managing Member may withhold and pay over to the Internal Revenue Service or any other taxing authority, pursuant to Code Sections 1441, 1442, 1445, 1446 and any other provisions of the Code or of state, local or foreign law, the amounts the Company may be required to withhold under those provisions or may be required to pay to any federal, state, local or foreign taxing authority relating to a Class A Member or Assignee. The amount of any taxes withheld and paid by the Company on behalf of a Member or Assignee thereof shall be deemed to constitute a distribution to such Class A Member or Assignee and, if withheld and paid in connection with a Capital Withdrawal by such Member or Assignee from a Capital Account, shall reduce (on a dollar for dollar basis) the amount the Company would otherwise pay directly to such Class A Member or Assignee in connection with such Capital Withdrawal.

6.9Distributions Upon Dissolution. Upon the commencement of the winding up of the Company pursuant to Article XI, the Company shall make no further distributions pursuant to this Article VI (unless the Managing Member determines otherwise in its sole and absolute discretion), but shall make all distributions in accordance with the order and priority set forth in Section 11.6, notwithstanding that such dissolution occurs subsequent to a distribution record date or the effective day of a withdrawal but prior to making the related distribution that would otherwise be made in connection therewith pursuant to this Agreement.

ARTICLE VII. CAPITAL ACCOUNTS; ALLOCATIONS

7.1Capital Accounts.  A capital account (a "Capital Account") shall be established and maintained for each Member to which shall be credited the Capital Contributions made by such Member and such Member's allocable share of Net Income (and items thereof), and from which shall be deducted distributions to such Member of cash or other property and such Member's allocable share of Losses (and items thereof). To the extent not provided for in the preceding sentence, the Capital Accounts of the Members shall be adjusted and maintained in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv).

7.2Allocations to Capital Accounts.

(a)Except as provided in Section 7.2(b) or elsewhere in this Agreement, Tax Items for any fiscal year shall be allocated among the Members in a manner such that the Capital Account of each Member, immediately after giving effect to such allocation, is, as nearly as possible, equal (proportionately) to the amount equal to the distributions that would be made to such Member during such fiscal year pursuant to Section 6.1. The Managing Member may, in its discretion, make such assumptions as it deems necessary or appropriate in order to effectuate the intended economic arrangement of the Members.

(b)Except as otherwise provided elsewhere in this Agreement, if upon the dissolution and termination of the Company pursuant to Section 6.6 and after all other allocations provided for in Section 7.2 have been tentatively made as if this Section 7.2(b) were not in this Agreement, a distribution to the Members under Section 6.9 would be different from a distribution to the Members under Section 6.1, then Tax Items for the fiscal year in which the Company dissolves and terminates pursuant to Section 6.9 shall be allocated among the Members in a manner such that the Capital Account of each Member, immediately after giving effect to such allocation, is, as nearly as possible, equal (proportionately) to the amount of the distributions that would be made to such Member during such last fiscal year pursuant to Section 6.1. The Managing Member may, in its discretion, apply the principles of this Section 7.2(b) to any fiscal year preceding the fiscal year in which the Company dissolves and terminates (including through application of Section 761(e) of the Code) if delaying application of the principles of this Section 7.2(b) would likely result in distributions under Section 6.9 that are materially different from distributions under Section 6.1 in the fiscal year in which the Company dissolves and terminates.

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(c)The following special allocations shall be made in the following order:

(i)Minimum Gain Chargeback.  Notwithstanding any other provision of this Section 7.2, if there is a net decrease in Company minimum gain (as defined in Treasury Regulations Section 1.704-2(b)(2) and (d)) during any fiscal year, the Members shall be specially allocated items of Company income and gain for such fiscal year (and, if necessary, subsequent fiscal years) in an amount equal to the portion of such Member's share of the net decrease in Company minimum gain, determined in accordance with Treasury Regulations Section 1.704-2(f) and (g). This Section 7.2(c)(i) is intended to comply with the minimum gain chargeback requirement in such section of the Treasury Regulations and shall be interpreted consistently therewith.

(ii)Member Minimum Gain Chargeback.  Notwithstanding any other provision of Section 7.2, if there is a net decrease in Member nonrecourse debt minimum gain attributable to a Member nonrecourse debt (as defined in Treasury Regulations Section 1.704-2(i)) during any fiscal year, each Member shall be specially allocated items of Company income and gain for such fiscal year (and, if necessary, subsequent fiscal years) in an amount equal to the portion of such Member's share of the net decrease in Member nonrecourse debt minimum gain attributable to such Member's nonrecourse debt, determined in accordance with Treasury Regulations Section 1.704-2(i). This Section 7.2(c)(ii) is intended to comply with the minimum gain chargeback requirement in such section of the Treasury Regulations and shall be interpreted consistently therewith.

(iii)Qualified Income Offset.  In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Company income and gain shall be specially allocated to each such Member in an amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations, the deficit, if any, in such Member's Capital Account (as determined under Treasury Regulations Section 1.704-1) as quickly as possible, provided that an allocation pursuant to this Section 7.2(c)(iii) shall be made only if and to the extent that such Member would have such Capital Account deficit after all other allocations provided for in Section 7.2 have been tentatively made as if this Section 7.2(c)(iii) were not in this Agreement. This Section 7.2(c)(iii) is intended to comply with the qualified income offset provisions in Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

(iv)Gross Income Allocation.  In the event any Member has a deficit balance in such Member's Capital Account (as determined after crediting such Capital Account for any amounts that such Member is obligated to restore or is deemed obligated to restore pursuant to Treasury Regulations Section 1.704-2), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate such deficit (as so determined) of such Member's Capital Account as quickly as possible; provided that an allocation pursuant to this Section 7.2(c)(iv) shall be made only if and to the extent that such Member would have such Capital Account deficit (as so determined) after all other allocations provided for in Section 7.2 (other than Section 7.2(c)(iii)) have been tentatively made as if this Section 7.2(c)(iv) were not in this Agreement.

(v)Loss Allocation Limitation.  No allocation of Losses (or items thereof) shall be made to any Member to the extent that such allocation would create or increase a deficit in such Member's Capital Account (as determined after debiting such Capital Account for the items described in Treasury Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6) and crediting such Capital Account for any amounts that such Member is obligated to restore or is deemed obligated to restore pursuant to Treasury Regulations Section 1.704-2).

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(d)Tax Items shall be allocated on a monthly basis.

(e)The Managing Member is authorized to adopt any convention or combination of conventions likely to be upheld for federal income tax purposes regarding the allocation and/or special allocation of items of Company income, gain, loss, deduction and expense with respect to a newly issued Interest, a transferred Interest and a redeemed Interest. A transferee of an Interest in the Company shall succeed to the Capital Account of the transferor Member to the extent it relates to the transferred Interest.

(f)Syndication expenses (as defined in Section 709(a) of the Code) for any fiscal year shall be allocated to the Capital Accounts of the Members so that, as nearly as possible, the cumulative amount of such expenses allocated with respect to such Member corresponds to the amount paid by such Member.

(g)Interest expense attributable to borrowings shall be specially allocated pro rata to the Members.

(h)Management Fee expenses shall be determined in a manner consistent with each Member's Capital Account, so that, as nearly as possible, the cumulative amount of such expenses allocated with respect to each Member corresponds to the amount paid by such Member.

(i)Loans and Loan Interests with significant risk of loss may be "Side-Pocketed" by the Managing Member.  As a result, the ownership in such investment may be limited to the then-current Members.

7.3Tax Allocations.

(a)Except as otherwise provided in Section 7.3(b), for each fiscal period, items of Company income, gain, loss, deduction and expense shall be allocated, for federal, state and local income tax purposes, among the Members in the same manner as the Tax Items of which such items are components were allocated pursuant to Section 7.2.

(b)Income, gains, losses and deductions with respect to any property (other than cash) contributed or deemed contributed to the capital of the Company shall, solely for income tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such property to the Company for federal income tax purposes and its Fair Market Value at the time of the contribution or deemed contribution in accordance with Section 704(c) of the Code and the Treasury Regulations promulgated thereunder. Such allocations shall be made in such manner and utilizing such permissible tax elections as determined in the discretion of the Managing Member. If there is a revaluation of Company property pursuant to the definition of Book Value, subsequent allocations of income, gains, losses or deductions with respect to such property shall be allocated among the Members so as to take account of any variation between the adjusted tax basis of such property to the Company for federal income tax purposes and its Fair Market Value in accordance with Section 704(c) of the Code and the Treasury Regulations promulgated thereunder. Such allocations shall be made in such manner and utilizing such permissible tax elections as determined in the discretion of the Managing Member.

(c)Allocations pursuant to this Section 7.3 are solely for federal, state and local tax purposes and shall not affect, or in any way be taken into account in computing, any Member's Capital Account or allocable share of Tax Items.

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(d)The Members acknowledge that they are aware of the tax consequences of the allocations made by this Section 7.3 and hereby agree to be bound by the provisions of this Section 7.3 in reporting their respective shares of items of Company income, gain, loss, deduction and expense.

7.4Determinations by Managing Member.

All matters concerning the computation of Capital Accounts, the allocation of items of Company income, gain, loss, deduction and expense for all purposes of this Agreement and the adoption of any accounting procedures not expressly provided for by the terms of this Agreement shall be determined by the Managing Member in its discretion. Such determinations shall be final and conclusive as to all the Members. Without in any way limiting the scope of the foregoing, if and to the extent that, for income tax purposes, any item of income, gain, loss, deduction or expense of any Member or the Company is constructively attributed to, respectively, the Company or any Member, or any contribution to or distribution by the Company or any payment by any Member or the Company is recharacterized, the Managing Member may, in its discretion and without limitation, specially allocate items of Company income, gain, loss, deduction and expense and/or make correlative adjustments to the Capital Accounts of the Members in a manner so that the net amount of income, gain, loss, deduction and expense realized by each relevant party (after taking into account such special allocations) and the net Capital Account balances of the Members (after taking into account such special allocations and adjustments) shall, as nearly as possible, be equal, respectively, to the amount of income, gain, loss, deduction and expense that would have been realized by each relevant party and the Capital Account balances of the Members that would have existed if such attribution and/or recharacterization and the application of this sentence of this Section 7.4 had not occurred. Notwithstanding anything expressed or implied to the contrary in this Agreement, in the event the Managing Member shall determine, in its discretion, that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto, are computed in order to effectuate the intended economic sharing arrangement of the Members, the Managing Member may make such modification.

ARTICLE VIII. RECORDS AND ACCOUNTING; REPORTS; CONFIDENTIALITY

8.1Books and Records; Inspection Rights.

(a)The Managing Member shall cause the Company to maintain such books and records relating to the business and affairs of the Company as are required to be maintained under the Act ("Required Records") and such other books and records as the Managing Member, in its sole and absolute discretion, may determine.

(b)Each Class A Member or its duly authorized representative, upon reasonable demand to the Managing Member (which demand shall be in writing and shall state the purpose thereof), shall have the right, subject to the provisions of Section 8.6, Section 18-305(c) of the Act and such other reasonable standards as may be established from time to time by the Managing Member (including standards governing what information and documents are to be furnished at what time and location and at whose cost and expense), to inspect the Required Records, at the principal office of the Company (during usual business hours), or to obtain copies of the Required Records from the Managing Member, for any purpose reasonably related to such Member's interest as a Member; provided, however, that, except to the extent otherwise required by law: (i) no Member of the Company shall have the right to inspect any Subscription Agreement to which such Member is not a party, notwithstanding that such Subscription Agreement is a Required Record; and (ii) neither the Company nor the Managing Member shall be required to disclose or furnish to any Member the identity (or related information, such as address and phone number) of any other Member of Assignee. For the avoidance of doubt, except to the extent otherwise required by law: (A) no Member shall have the right to inspect any books or records in the possession or under the control of the Managing Member (or any of its Affiliates) or the Company to the extent such books or records are not Required Records; and (B) no Assignee shall have the right to inspect any Required Records or any other books and records in the possession or under the control of the Managing Member (or any of its Affiliates) or the Company.

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8.2Fiscal Year; Fiscal Quarters; Accounting Periods; Accounting Methods.

(a)The Fiscal Year shall be the calendar year and the Accounting Period shall be the same as the Fiscal Year.

(b)The Managing Member shall cause the Company to keep its financial books under the cash method of accounting, and, as to matters not specifically covered in this Agreement, in accordance with generally accepted accounting principles applied on a consistent basis. The Managing Member reserves the rights to change the method of accounting in its sole discretion.

8.3Determination and Calculation of Liabilities.

(a)The Managing Member shall determine the amount of the Liabilities in accordance with generally accepted accounting principles (except as otherwise provided in Section 8.3(c) or in the Offering Circular.

(b)For purposes of determining the Liabilities at a particular time, the Managing Member may estimate costs or expenses that are incurred on a regular or recurring basis over yearly or other periods and treat the amount of any such estimate as accruing in equal portions over any such period.

(c)The Managing Member may establish (and increase or decrease from time to time) such reserves for: (i) estimated accrued costs or expenses; and (ii) contingent, unknown or unfixed debts, liabilities or obligations for the Company, even if such reserves are not required by generally accepted accounting principles ("Reserves"). Any such Reserve in respect, to the extent reversed, shall be allocated among the Capital Accounts of the Persons who are Members or Assignees at the time of such reversal in the manner provided in Section 7.2, unless the Managing Member, in its sole and absolute discretion, determines to allocate such reversal among the Capital Accounts of those Persons who were Members or Assignees at the time such Reserve was established or increased, as the case may be.

8.4Reports. The Managing Member shall provide such periodic reports as required by the Securities Act.

8.5Tax Matters.

(a)The Managing Member shall cause all required federal, state and local income or

information tax returns ("Tax Returns") to be prepared and timely filed (subject to the Managing Member's discretion to obtain extensions) with the appropriate authorities.

(b)The Managing Member shall determine the accounting methods and conventions

under the tax laws of the United States, the several states and other relevant jurisdictions ("Tax Laws") as to the treatment of Tax Items or any other method or procedure relating to the preparation of the Tax Returns.

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(c)The Managing Member may cause the Company to make (or refrain from making) any and all tax elections permitted by the Tax Laws, including the election referred to in Section 754 of the Code, and may charge the costs of complying with such election to the Member(s) or Assignee(s) who requested that such election be made.

(d)As soon as reasonably practicable after the end of each Fiscal Year, the Managing Member shall cause to be delivered to each Person who was a Member or Assignee at any time during such Fiscal Year such tax information and schedules relating as are necessary to enable such Person to prepare its federal income tax return in accordance with the laws, rules and regulations then prevailing.

(e)Each Member and Assignee agrees in respect of any year in which such Member or Assignee had an investment, unless the Managing Member expressly agrees otherwise in its sole and absolute discretion, such Member or Assignee shall not: (i) treat, on its tax returns, any Tax Item relating to such investment in a manner inconsistent with the treatment of such Tax Item, as reflected on the Schedule K-1 or other information statement furnished by the Company to such Member or Assignee; or (ii) file any claim for a refund relating to any such Tax Item based on, or which would result in, any such inconsistent treatment.

(f)The Managing Member is hereby appointed the "tax matters partner" of the Company for all purposes pursuant to Sections 6221-6231 of the Code.

(g)Each Member and Assignee shall furnish the Managing Member with such information, forms and certifications as it may require and as are necessary to comply with the regulations governing the obligations of withholding tax agents or as are necessary with respect to any withholding taxes imposed by countries other than the U.S. Each Member and Assignee represents that the information and forms furnished by him shall be true and accurate in all respects and agrees to indemnify the Company and the Managing Member for his allocable share of any applicable tax of any type (including any liability for penalties, additions to tax or interest) attributable to his share of income or the distributions to him.

8.6Confidentiality.

(a)General Rule of Confidentiality. Except as provided in Section 8.6(b), each Member and Assignee agrees to keep confidential, not to make any use of, and not to provide or disclose to any Person, any information or matter relating to the Company or its business and affairs, including reports furnished to Members and Assignees pursuant to Section 8.4, the identities of other Members and Assignees, any offering materials used in connection with the marketing and private placement of Interests in the Company (including this Agreement and the Subscription Agreements) and any information or matter related to any investment made by the Company (all of the foregoing, "Confidential Information").

(b)Exceptions to General Rule of Confidentiality. Notwithstanding the provisions of Section 8.6(a):

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(i)A Member or Assignee may provide or disclose Confidential Information to its members, partners, shareholders, directors, officers and employees, to its financial, legal, tax and other advisors, and to such other Persons as the Managing Member may approve in its sole and absolute discretion (each of the foregoing, an "Authorized Person"), for any purpose reasonably related to its interest in the Company; provided, however, that such Member or Assignee notifies each such Authorized Person in writing of the restrictions set forth in this Section 8.6 and states in such writing, in a prominent fashion, that such Authorized Person, by receiving such Confidential Information, shall be deemed to have agreed to comply with such restrictions for the benefit of the Company and the Managing Member.

(ii)A Member or Assignee  or any of its Authorized Persons may provide or disclose Confidential Information to any Person if: (A) the information contemplated to be provided or disclosed is publicly known at the time of the proposed disclosure as a result of actions other than a breach by such Member or Assignee or any of its Authorized Persons of the provisions of this Section 8.6; (B) such disclosure is required by law or regulation; (C) such disclosure is required to be made by a Governmental Entity or self-regulatory organization having jurisdiction over such Member or Assignee; (D) such disclosure is made in good faith in response to a written request for information by a Governmental Entity or self-regulatory organization having jurisdiction over such Member or Assignee; (E) such disclosure is made in good faith during the course of an examination of such Member or Assignee by a Governmental Entity or self-regulatory organization having jurisdiction over such Member or Assignee; or (F) such disclosure is approved in advance by the Managing Member in its sole and absolute discretion. A Member or Assignee or its Authorized Person who discloses Confidential Information pursuant to this Section 8.6(b)(ii) shall: (1) in the case of any disclosure made pursuant to clause (E) of this Section 8.6(b)(ii), promptly provide the Managing Member a copy of the written request for information described in that clause; and (2) in the case of any disclosure made pursuant to clauses (B), (C) or (D) of this Section 8.6(b)(ii), use its reasonable best efforts to: (a) give reasonable prior Notification of such disclosure to the Managing Member to afford the Managing Member the opportunity to obtain an appropriate protective order and (b) inform each recipient of such information of the confidential nature of such information.

(c)Disclosure of Tax Treatment. Notwithstanding anything to the contrary in this Agreement or in any other documents pertaining to an investment in the Company, a Member or Assignee (or any of its Authorized Representatives) may disclose to any and all persons, without limitation of any kind, the anticipated tax treatment and tax structure of the Company and transactions contemplated by the Company, and all materials of any kind (including opinions or other tax analyses) related to such tax treatment and tax structure, if any.

(d) Rights of Managing Member.

(i)The Managing Member may disclose to any Class A Member or Assignee or any prospective investor such information relating to the Company or its investments as the Managing Member determines to be necessary to retain any such Class A Member or Assignee as an investor in in the Company or facilitate an investment in the Company by any such prospective investor, as the case may be.

(ii)The Managing Member may disclose to any Person that provides or may

provide service to the Company such information relating or its investments as the Managing Member determines to be necessary, appropriate, advisable, incidental or convenient to effect the formation or manage and conduct its business and affairs.

(iii)Unless the Managing Member expressly agrees otherwise, the Managing Member, in its sole and absolute discretion, may publicize: (A) the fact that it serves as the Manager of the Company, (B) the performance of the Company's Investments and (C) the identity of Class A Members and Assignees, provided it does so in a manner that does not constitute "general advertising" or "general solicitation" with respect to the Company or the Interests therein within the meaning of Rule 503(c) of Regulation D under the 1933 Act and does not contain any untrue or misleading information.

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(e) Proprietary Information of Managing Member.

(i)Each Class A Member and Assignee acknowledges and agrees that the Managing Member, its Affiliates and their respective licensors own all rights, title and interest in and to the trading models, strategies, software and other proprietary materials utilized or generated by them in the course of managing and conducting the business and affairs of the Company, including all patent, trademark, copyright and trade secret rights therein (all of the foregoing, "Proprietary Information").

(ii)Nothing in this Agreement shall be construed as granting the Class A Members or Assignees of the Company any rights or license of any kind with respect to the Proprietary Information.

(iii)Each Class A Member and Assignee agrees: (A) to keep the Proprietary Information confidential pursuant to Section 8.6(a), and (B) not to copy, alter, reverse engineer or decompile the Proprietary Information or otherwise attempt to access or use any of the trade secrets contained therein.

ARTICLE IX. EXCULPATION AND INDEMNIFICATION OF MANAGING MEMBER ASSOCIATES

9.1Exculpation.

(a) Notwithstanding any other provision of this Agreement:

(i)to the extent that, at law or in equity, the Managing Member, Investment Manager or Liquidating Trustee, as the case may be, has duties (including fiduciary duties) and liabilities relating thereto to the Company, the Company or any Class A Member or Assignee of the Company arising under or otherwise relating to this Agreement, the Managing Member, Investment Manager or Liquidating Trustee, as the case may be, shall not be liable for monetary or other damages to the Company or such Class A Member or Assignee for: (A) losses sustained or liabilities incurred by the Company or such Class A Member or Assignee, except to the extent that it is Judicially Determined that an act or omission of the Managing Member or Liquidating Trustee, as the case may be, was material to the matter giving rise to such losses or liabilities and that such act or omission constituted criminal wrongdoing, willful misfeasance, bad faith or gross negligence on the part of the Managing Member, Investment Manager or Liquidating Trustee, as the case may; (B) losses sustained or liabilities incurred by the Company or such Class A Member or Assignee arising from or otherwise relating to any act or omission of any Person selected by the Managing Member, Investment Manager or Liquidating Trustee to perform services for or otherwise transact business with the Company, as the case may be, except to the extent that it is Judicially Determined that the selection of such Person involved criminal wrongdoing, willful misfeasance, bad faith or gross negligence on the part of the Managing Member, Investment Manager or the Liquidating Trustee, as the case may be, and was material to the matter giving rise to such losses or liabilities; or (C) circumstances beyond the control of the Managing Member, Investment Manager or Liquidating Trustee, including changes in tax or other laws, rules or regulations or the bankruptcy, insolvency or suspension of normal business activities of any broker-dealer, bank or other financial institution that holds assets of the Company; and

(ii)to the extent that, at law or in equity, a Managing Member Associate (other than the Managing Member) or Liquidating Trustee Associate (other than the Liquidating Trustee) has duties (including fiduciary duties) and liabilities relating thereto to the Company or any Member or Assignee of the Company arising under or otherwise relating to this Agreement, such Managing Member Associate or Liquidating Trustee Associate shall not be liable for monetary or other damages to the Company or such Class A Member or Assignee for losses sustained or liabilities incurred by the Company or such Class A Member or Assignee, except to the extent that it is Judicially Determined that an act or omission of such Managing Member Associate or Liquidating Trustee Associate, as the case may be, was material to the matter giving rise to such losses or liabilities and that such act or omission constituted criminal wrongdoing, willful misfeasance or bad faith on the part of such Managing Member Associate or Liquidating Trustee Associate, as the case may be.

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(b)Each Managing Member Associate and Liquidating Trustee Associate shall be fully protected in relying in good faith upon the books and records of the Company and upon such information, opinions, reports or statements presented to the Company  by any of its members, managers, partners, shareholders, directors, officers or agents (including legal counsel, accountants, auditors, appraisers, investment bankers and other independent experts acting for the Company  or any member, manager, partner, shareholder, director, officer or agent of the Company  as to matters such Managing Member Associate or Liquidating Trustee Associate, as the case may be, reasonably believes are within such other Person's professional or expert competence, including information, opinions, reports, or statements as to the value and amount of the assets, liabilities, profits or losses  or any other facts pertinent to the existence and amount of assets from which distributions might properly be made.

9.2Indemnification.

(a)To the fullest extent permitted by law, the Company shall indemnify the Managing Member, the Investment Manager, each Managing Member Associate and each Liquidating Trustee Associate (each, an "Indemnitee") against any and all losses, damages, liabilities, costs, expenses (including reasonable legal and expert witness fees and related costs and expenses), judgments, fines, amounts paid in settlement, and other amounts (including costs and expenses associated with investigation or preparation), actually and reasonably paid or incurred by such Indemnitee in connection with any and all Proceedings that arise from or relate, directly or indirectly, to any act or omission (or alleged act or omission) of such Indemnitee in connection with this Agreement or the business or affairs of the Company and in which such Indemnitee may be involved, or is threatened to be involved, as a defendant, witness, deponent or otherwise (but not as a plaintiff, unless the Managing Member agrees otherwise in its sole and absolute discretion), whether or not the same shall proceed to judgment or be settled or otherwise be brought to a conclusion (collectively, "Losses"), except to the extent that it is Judicially Determined that such Indemnitee is not entitled to be exculpated in respect of such act or omission pursuant to the provisions of Section 9.1.

(b)To the extent it is Judicially Determined that the Company may not lawfully indemnify an Indemnitee for Losses pursuant to the provisions of Section 9.2(a) (other than because such

Indemnitee is not entitled to be exculpated in respect of the related act or omission pursuant to the provisions of Section 9.1), the Company shall, to the fullest extent permitted by law, contribute to the amount paid or payable by such Indemnitee as a result of such Losses in such proportion as is appropriate to reflect not only the relative benefits received by the Company, on the one hand, and such Indemnitee, on the other hand, but also the relative fault of the Company and such Indemnitee, as well as any other equitable considerations.

(c)Reasonable legal fees and other costs and expenses (including costs and expenses associated with any investigation and preparation) incurred by an Indemnitee in connection with any Proceeding in which such Indemnitee is a party, witness or deponent shall be paid or reimbursed by the Company in advance of the final disposition of such Proceeding upon receipt by the Company of (i) a written affirmation by such Indemnitee of such Indemnitee's good faith belief that the standard of conduct necessary for indemnification by the Company, as stated in Section 9.2(a), has been met, and (ii) a written undertaking by or on behalf of such Indemnitee to promptly repay the amount paid or reimbursed if it shall ultimately be Judicially Determined that such Indemnitee is not entitled to be indemnified by the Company hereunder.

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(d)The Managing Member may cause the Company to purchase and maintain insurance, at the cost and expense of the Company, on behalf of any one or more Persons against any liability that may be asserted against or costs or expenses that may be incurred by such Person(s) in connection with the activities of the Company, regardless of whether the Company would have the power to indemnify any such Person(s) against such liability under the provisions of this Agreement.

(e)An Indemnitee shall not be denied indemnification in whole or in part under this Section 9.2 solely because the Indemnitee had an interest in the transaction with respect to which the indemnification applies.

(f)Any Indemnitee entitled to indemnification hereunder shall use its reasonable best efforts to minimize the amount of any claim for indemnification hereunder.

(g)The rights of an Indemnitee to indemnification, contribution and reimbursement provided by this Section 9.2 shall be in addition to any other rights to which such Indemnitee may be entitled under any agreement with the Company, as a matter of law or otherwise, and shall continue as to a Managing Member Associate or Liquidating Trustee Associate, as the case may be, who has ceased to serve in such capacity and shall also be for the benefit of such Indemnitee's Personal Representatives, but shall not be deemed to create any rights for the benefit of any other Persons. This Article IX, however, shall not be construed to entitle any Indemnitee to receive any amount in respect of any Losses of such Indemnitee to the extent that, after giving effect to the receipt of such amount and the receipt by such Indemnitee of any other payments in respect of such Losses, from whatever source or sources, such Indemnitee shall have recovered an aggregate amount in excess of such Losses.

(h)Indemnification Obligations in respect shall remain in effect for a period of two (2) years after the date of the dissolution pursuant to Article XI, except that Indemnification Obligations shall continue as to any Loss of which any Indemnitee shall have given Notification to the Company on or prior to the date such Indemnification Obligation would otherwise terminate in accordance with this Section 9.2, until it is Judicially Determined that the Company is not liable for such Loss.

(i)In any suit brought by an Indemnitee to enforce a right to indemnification or the advancement of expenses provided for in this Agreement, the burden of proving that such Indemnitee is not entitled to be indemnified or to an advancement of expenses is on the Company (or any Class A Member or Assignee acting derivatively or otherwise on behalf of the Company, as the case may be).

9.3Limits on Exculpation and Indemnification. The Managing Member acknowledges, on its own behalf, on behalf of the other Managing Member Associates and on behalf of the Liquidating Trustee Associates, that: (a) the federal securities laws (and the rules and regulations thereunder) confer certain rights on each Class A Member and Assignee and impose certain liabilities on the Managing Member Associates and Liquidating Trustee Associates, and that the Managing Member Associates and Liquidating Trustee Associates may not lawfully seek an agreement from any Class A Member or Assignee to waive, modify or limit such Class A Member's or Assignee's exercise of such rights or to relieve the Managing Member Associates or Liquidating Trustee Associates of such liabilities; and (b) other applicable laws may confer rights on the Class A Members and Assignees, and/or impose liabilities on the Managing Member Associates or Liquidating Trustee Associates, that may not be waived, modified or limited by an agreement between the Managing Member Associates or Liquidating Trustee Associates, on the one hand, and the Class A Members and Assignees, on the other hand. Accordingly, to the extent a Class A Member or Assignee has rights under the federal securities laws (or the rules and regulations thereunder), nothing in this Article IX should be construed to impose any limitation on a Class A Member's or Assignee's exercise of such rights, and to the extent the federal securities laws (or any rule or regulation thereunder) impose liabilities on a Managing Member Associate or Liquidating Trustee Associate, nothing in this Article IX should be construed to impose any limitation on such liability. Similarly, to the extent a Class A Member or Assignee has rights or a Managing Member Associate or Liquidating Trustee Associate has liabilities under other applicable law that may not be waived, modified or limited by agreement between such Managing Member Associate or Liquidating Trustee Associate, on the one hand, and such Class A Member or Assignee, on the other hand, nothing in this Article IX should be construed to impose any limitation on such Class A Member's or Assignee's exercise of such rights or to relieve such Managing Member Associate or Liquidating Trustee Associate of such liabilities.

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ARTICLE X. AMENDMENT; CONSENTS FOR OTHER PURPOSES

10.1Amendments.

(a)Subject to Section 10.1(c), the Managing Member may amend this Agreement at any time and from time to time, whether by changing any one or more of the provisions hereof, deleting any one or more provisions herefrom or adding one or more provisions hereto:

(i)without obtaining the authorization, approval, agreement, consent or vote of any Class A Member or Assignee of the Company to: (A) cure any ambiguity or inconsistency herein, or (B) address any matter or question not addressed herein, provided that, in the Managing Member's judgment, no such amendment has or could reasonably be expected to have a material adverse effect on the Company or the Class A Members and Assignees thereof generally;

(ii)without obtaining the authorization, approval, agreement, consent or vote

of any Class A Member or Assignee : (A) to add to the obligations of the Managing Member hereunder, or surrender any right, power or authority granted to the Managing Member hereunder, for the benefit of the Class A Members or Assignees thereof; (B) to provide, pursuant to Section 3.4 that any one or more Additional Managers may possess and exercise any one or more of the rights, powers and authority possessed by the Managing Member under this Agreement; (C) to change the name of the Company ; (D) to reflect the admission, substitution, and withdrawal of Class A Members and Assignees effected after the date hereof in accordance with this Agreement; (E) to reflect Capital Contributions and Capital Withdrawals effected after the date hereof in accordance with this Agreement; and (F) for such other purpose or purposes as the Managing Member may determine to be necessary, appropriate, advisable, incidental or convenient to the management and conduct of the business and affairs of the Company, provided that, in the Managing Member's judgment, no such amendment pursuant to this clause (G) has or could reasonably be expected to have a material adverse effect on the Company  or the Class A Members and Assignees thereof generally;

(iii)without obtaining the authorization, approval, agreement, consent or vote

of any Class A Member or Assignee of the Company, to cause the Company to enter into an agreement with any Class A Member or Assignee thereof to waive or modify the application of any provision of this Agreement with respect to such Class A Member or Assignee, provided that, in the Managing Member's judgment, no such waiver or modification pursuant to this subparagraph (iii) has or could reasonably be expected to have a material adverse effect on the Company or the Class A Members and Assignees thereof generally;

(iv)without obtaining the authorization, approval, agreement, consent or vote

of any Class A Member or Assignee of the Company, to: (A) cause the provisions of Article VII to comply with the provisions of Section 704 of the Code and applicable Treasury Regulations, (B) otherwise cause the Company  to comply with any requirement, condition or guideline contained in any federal, state, local or foreign law or in any order, directive, opinion, ruling or regulation of any Governmental Entity or self-regulatory organization, (C) qualify the Company  as (or to do business as) a limited liability company or a company in which Class A Members and Assignees have limited liability, under the laws of any State or other jurisdiction in which the Managing Member determines such qualification to be necessary or advisable, (D) prevent an Adverse Regulatory Effect, provided that the Managing Member takes such measures as are reasonably necessary to prevent any amendment pursuant to this Section 10.1(a)(iv) from having a material adverse effect on the Class A Members and Assignees thereof generally; or

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(v)in a manner that materially adversely affects or could reasonably be expected to have a material adverse effect on the Class A Members or Assignees in general or any one or more specific Class A Members or Assignees, if the Managing Member receives consent to such amendment from such affected Class A Member(s) or Assignee(s).

(b)It shall be conclusively presumed that no waiver or permission granted to any one or more Class A Members or Assignees, and no agreement entered into with any one or more Class A Members or Assignees, pursuant to Section 3.4(c) or 4.2(b), has or could reasonably be expected to have a material adverse effect on the Company, the Company or any Class A Member or Assignee to whom such a waiver or permission is not granted or with whom such an agreement is not entered into.

(c)Notwithstanding any provision of Section 10.1(a), the Managing Member may not amend this Agreement so as to: (i) require a Class A Member or Assignee to pay any sum of money whatsoever in respect of such Class A Member's or Assignee's Interest in the Company, whether in the form of a Capital Contribution, a loan or otherwise, other than that which such Class A Member or Assignee has agreed to pay by way of such Class A Member's Subscription Agreement(s), this Agreement or another agreement executed and delivered by such Class A Member or Assignee; (ii) materially reduce the increases and decreases of Net Assets of the Company or the amount of distributions of the Company to which such Class A Member or Assignee is entitled under this Agreement, without the consent of such Class A Member or Assignee; (iii) change the Management Fee, change the Preferred Return or otherwise modify the allocation of Net Income; or (iv) modify the limited liability of a Class A Member, without the consent of such Class A Member.

(d)If the Managing Member adopts an amendment to this Agreement pursuant to Section 10.1(a)(i), (ii), (iii) or (iv), it shall provide affected Class A Members and Assignees a copy of such amendment, or a reasonably detailed description of such amendment, within ten (10) Business Days after the effective date of such change; provided, however, that an inadvertent failure to comply with the provisions of this Section 10.1(d) with respect to any such amendment shall not affect the substance or effectiveness of such amendment in any respect.

(e)For the avoidance of doubt, no amendment may be made to this Agreement without the consent or approval of the Managing Member.

10.2Amendment of Certificate.

(a)The Managing Member shall cause the Certificate to be amended and/or restated

at such time or times, to such extent and in such manner as may be required by the Act.

(b)The Managing Member, in its sole and absolute discretion, may cause theCertificate to be amended and/or restated in accordance with the principles set forth in Section 10.1, and any such amendment and/or restatement shall be effective immediately upon the filing of a certificate of amendment in the office of the Secretary of State of the State of Delaware or upon such future date as may be stated therein.

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10.3Consents for Other Purposes. The Managing Member may from time to time determine to submit to the Company, for its approval, actions or practices that are not required to be approved by the Class A Members or Assignees thereof pursuant to this Agreement (including transactions subject to the provisions of Section 206(3) of the Advisers Act). Any such action or practice shall be deemed to have been approved by the Class A Members of the Company if: (a) no later than thirty (30) calendar days prior to taking such proposed action or implementing such proposed practice, the Managing Member gives Notification to the Class A Members describing such action or practice in reasonable detail and (b) (i) prior to taking such action or implementing such practice, the Managing Member obtains the Consent to such action or practice or (ii) a Class A Member fails to respond to the Notification within such thirty (30) day period.

ARTICLE XI. DISSOLUTION AND WINDING UP

11.1Events Causing Dissolution.

(a)The Company shall dissolve and commence winding up of its business and affairs upon the first to occur of the following events, and, except as otherwise required by the Act or other applicable law, no other event shall cause the dissolution of the Company:

(i)the Managing Member declares in writing that the Company shall be

dissolved and gives Notification of such declaration to all Class A Members and Assignees;

(ii)the sale, exchange or other disposition of all or substantially all of our assets;

(iii)the Bankruptcy of the Managing Member; provided, however, that the Bankruptcy of the Managing Member shall not cause the dissolution of the Company if at the time of such Bankruptcy there is at least one other Manager of the Company that has been admitted to the Company as a Manager pursuant to Section 3.4(b) and such other Manager carries on the business of the Company (it being understood and agreed that this Agreement shall be construed to permit the business of the Company to be carried on by such other Manager in the event of the Bankruptcy of the Managing Member); or

(iv) the entry of a decree of judicial dissolution of the Company under

Section 18-802 of the Act.

11.2Winding Up. If the Company is dissolved pursuant to Section 11.1, its business and affairs shall be wound up as soon as reasonably practicable thereafter in the manner set forth below.

(a)The winding up of the business and affairs of the Company shall be carried out by a liquidating trustee, which shall be the Managing Member (the "Liquidating Trustee").

(b)Unless otherwise required by law, the Liquidating Trustee of the Company shall be the Managing Member or a Person appointed by the Managing Member; provided, however, that if the Company is dissolved by operation of the provisions of Section 11.1(a)(ii) or (iii), the Liquidating Trustee shall be a person appointed by a Majority in Interest of the Class A Members, determined as of the beginning of the Accounting Period during which such dissolution occurred.

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(c)The Managing Member may revoke the appointment of a Liquidating Trustee, and appoint a successor Liquidating Trustee, at any time; provided, however, that if the Company is dissolved by operation of the provisions of Section 11.1(a)(ii) or (iii) or pursuant to Section 11.1(b)(iv), such revocation and appointment of a successor may be made only by a Majority in Interest of the Class A Members determined as of the beginning of the Accounting Period during which such dissolution occurred.

11.3Powers of Liquidating Trustee. The Liquidating Trustee shall possess full and exclusive right, power and authority to effect the winding up of the business and affairs of the Company and the termination of the existence of the Company as a separate legal entity. In winding up the business and affairs of the Company and terminating the Company's existence as a separate legal entity, the Liquidating Trustee may exercise or invoke all rights, powers, authority and privileges that the Managing Member may exercise or invoke under this Agreement.

11.4Costs and Expenses of Liquidation; Compensation of Liquidating Trustee.

(a)The Company shall bear, exclusively out of the Assets, such costs and expenses as the Liquidating Trustee shall reasonably determine to be necessary, appropriate, advisable, incidental or convenient to effect the orderly winding up of the Company's business and affairs and the termination of the Company's existence as a separate legal entity, other than costs and expenses relating to the winding up of the business and affairs of the Company.

(b)The Liquidating Trustee shall be entitled to receive from the Company, exclusively out of the Assets, such reasonable compensation for its services relating to the winding up of the business and affairs of the Company as the Managing Member may from time to time determine, other than for services relating to the winding up of the business and affairs of the Company; provided, however, that if the Company is dissolved pursuant to Section 11.1(a)(ii) or (iii), such compensation shall be determined by a simple majority of the Class A Members determined as of the date such dissolution occurred.

11.5Final Statement. Within a reasonable time following the completion of the winding up of the business and affairs (excluding, for purposes of this Section 11.5, the disposition of reserves described in Section 11.6(a)), the Liquidating Trustee shall furnish to each Class A Member and Assignee a statement setting forth the assets and the liabilities as of the date of such completion and such Class A Member's or Assignee's share of distributions.

11.6Distribution of Property and Proceeds of Sale Thereof.

(a)Within thirty (30) calendar days following completion of the statement referred to in Section 11.5, the Liquidating Trustee shall, in accordance with Section 18-804(a) of the Act, distribute the assets of the Company in the following order of priority:

(i)to pay or make reasonable provision for the payment of the debts, liabilities and obligations to creditors (including the compensation payable to the Liquidating Trustee and other costs and expenses associated with the dissolution and winding up of the business and affairs of the Company), including, to the extent permitted by applicable law, Members, Assignees and former Members and Assignees who are creditors (other than liabilities for distributions to Members, Assignees and former Members and Assignees under Sections 18-601 or 18-604 of the Act);

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(ii)to pay or make reasonable provision for the payment of the debts, liabilities and obligations to creditors who are Members, Assignees or former Members or Assignees (other than liabilities for distributions to Members, Assignees and former Members and Assignees under Sections 18-601 or 18-604 of the Act), to the extent not paid or provided for pursuant to Section 11.6(a)(i);

(iii)to satisfy liabilities to Members, Assignees and former Members and Assignees for distributions under Sections 18-601 or 18-604 of the Act; and

(iv)to the Class A Members and Class B Members in accordance with Section 6.1.

(b)Pursuant to the provisions of Section 18-804(b) of the Act, if there are sufficient assets to satisfy the claims of all priority groups specified above, such claims shall be paid in full and any such provision for payment shall be made in full. If there are sufficient assets to satisfy the claims of one or more but not all priority groups specified above, the claims of the highest priority groups that may be paid or provided for in full shall be paid or provided for in full, before paying or providing for any claims of a lower priority group. If there are insufficient assets to pay or provide for the claims of a particular priority group specified above, such claims shall be paid or provided for ratably to the claimants in such group to the extent of the assets available to pay such claims.

11.7Deficit Capital Accounts. Notwithstanding any other provision of this Agreement, to the extent that, upon completion of the winding up of the business and affairs, there is a deficit in any Member's or Assignee's Capital Account, such deficit shall not be an asset of the Company and such Member or Assignee shall not be obligated to contribute such amount to the Company to bring the balance of such Capital Account to zero.

ARTICLE XII. MISCELLANEOUS

12.1Construction and Governing Law.

(a)Each Subscription Agreement executed and delivered by a Member or Assignee, including any representations, warranties, covenants and power of attorney set forth therein, is hereby incorporated into this Agreement as if set forth in full in this Agreement.  This Agreement, the Certificate and the Subscription Agreements, as modified or supplemented, contain the entire understanding and agreement among the respective parties hereto and thereto with respect to the subject matter hereof and thereof, and supersede all prior and contemporaneous agreements, understandings, arrangements, inducements or conditions, express or implied, oral or written, between or among any of the parties hereto or thereto with respect to the subject matter hereof and thereof.

(b)To the extent not preempted by ERISA or the Securities and Commodities Laws, all provisions of this Agreement, the Certificate, the Subscription Agreements shall be governed by and construed, administered and enforced in accordance with the internal substantive laws of the State of Delaware without regard to "choice of law," "conflict of laws" or similar principals of the State of Delaware or any other jurisdiction. In applying the provisions of this Agreement, it is understood and agreed that, regardless of where this Agreement may be executed by a party hereto, this Agreement is executed and delivered by the parties pursuant to the Act, and that the parties intend that the provisions of this Agreement be given full force and effect pursuant to the principles set forth in Sections 18-1101 (b), (c) and (d) of the Act. Without limiting the scope of the preceding sentence, to the extent this Agreement modifies or nullifies any provision of the Act that would apply in the absence of such modification or nullification, as permitted by the Act (any such provision of the Act being referred to herein as a "default" provision), such modification or nullification shall apply in preference to such "default" provision.

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(c)The parties hereto intend that the provisions hereof be construed as if drafted jointly by the parties and that no presumption or burden of proof arise favoring or disfavoring any party by virtue of the authorship of this Agreement.

(d)Wherever possible, each provision in this Agreement shall be construed in such a manner as to be valid, legal and enforceable under applicable law. It is the intention of the Parties that, in case any one or more of the provisions contained in this Agreement shall, for any reason, be found or held invalid, illegal or unenforceable to any extent in any jurisdiction, such provision shall be reformed in such jurisdiction to reflect the intent thereof to the greatest extent permitted by law and, to the extent not so reformed, shall be ineffective only in such jurisdiction and only to the extent of such invalidity, illegality or unenforceability without invalidating (i) the effect of such provision in any other jurisdiction or (ii) the effect of any other provision in that or any other jurisdiction, unless such a construction would be unreasonable. If the Managing Member shall determine, with the advice of reputable counsel, that any provision of this Agreement is in conflict with (A) the Securities and Commodities Laws or (B) other applicable laws, rules, regulations or orders, whether generally or in a particular application, the conflicting provision or such particular application thereof, as the case may be, shall not be deemed to constitute a part of this Agreement for so long as such conflict exists (provided, however, that such determination shall not affect any of the remaining provisions of this Agreement or any lawful application of any provision, or render invalid or improper any action taken or omitted prior to such determination). In construing the meaning or application of the Securities and Commodities Laws, the Managing Member may consider the effect of any applicable order or interpretive release issued by the Securities and Exchange Commission or the Commodity Futures Trading Commission, as the case may be, or any applicable "no action" or interpretive position issued by the staff of either such Commission, that modifies or interprets the Securities and Commodities Laws.

(e)If the Managing Member determines that any provision of this Agreement is ambiguous or inconsistent with any other provision of this Agreement, it may construe such provision in such manner as it may determine, and such construction shall be conclusive and binding as to the meaning

to be given to such provision.

(f)All matters concerning: (i) the valuation of the assets associated with the Company; (ii) the determination of the amount of the liabilities associated with the Company; (iii) the allocation of profits, gains and losses among the Members and Assignees of the Company, including taxes thereon; and (iv) the accounting practices and procedures of the Company (to the extent not specifically provided for in this Agreement), shall be determined by the Managing Member, whose good faith determinations in such matters shall, absent manifest error, be conclusive and binding on the Members and Assignees.

(g)Each reference in this Agreement to a statute or regulation, or provision thereof, shall be deemed to refer to such statute or regulation, or provision thereof, as amended from time to time, or to any superseding statute or regulation, or provision thereof, as is from time to time in effect, as well as to applicable regulations then in effect thereunder.

(h)In computing the number of days for purposes of this Agreement, all days shall be counted, including Saturdays, Sundays and holidays; provided, however, that if the final day of any time period falls on a day that is not a Business Day, then the final day of such time period shall be deemed to be the next day which is a Business Day.

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(i)Except as otherwise stated in this Agreement, references in this Agreement to Articles, Sections and Annexes are to Articles, Sections and Annexes of this Agreement. The headings to Articles and Sections are for convenience of reference only and shall not be considered in construing this Agreement.

(j)Where appropriate, each definition and pronoun in this Agreement includes the singular and the plural, and reference to a particular gender includes each other gender. As used in this Agreement, the word "including" shall mean "including without limitation," and the word "or" is not exclusive.

(k)The express provisions of this Agreement control and supersede any course of performance or usage of the trade inconsistent with any of the provisions hereof.

(l)EACH MEMBER AND ASSIGNEECONSENTS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA AND THE FEDERAL COURTS OF THE UNITED STATES, IN EACH CASE SITTING IN ORANGE COUNTY, CALIFORNIA IN ANY PROCEEDING.

EACH MEMBER AND ASSIGNEE AGREES NOT TO RAISE ANY OBJECTION TO VENUE IN THE COURTS OF THE STATE OF CALIFORNIA AND THE FEDERAL COURTS OF THE UNITED STATES, IN EACH CASE SITTING IN ORANGE COUNTY, CALIFORNIA, IN ANY PROCEEDING.

EACH MEMBER AND ASSIGNEE CONSENTS TO SERVICE OF PROCESS, SUMMONS OR NOTICE IN ANY PROCEEDING BY WAY OF NOTIFICATION THEREOF TO SUCH MEMBER OR ASSIGNEE BY REGISTERED OR CERTIFIED U.S. MAIL (FIRST CLASS POSTAGE PREPAID, RETURN RECEIPT REQUESTED).

12.2Counterparts. This Agreement may be executed in any number of counterparts (each of which shall be deemed to be an original as against any party whose signature appears thereon). All of such counterparts shall together constitute one and the same instrument, with the same effect as if all parties executing such counterparts had executed the same signature page. Any writing, including a Subscription Agreement, that has been duly executed by a Person in which such Person has agreed to be bound hereby as a Member shall be considered a counterpart for purposes of the foregoing.

12.3Binding Effect. The provisions of this Agreement shall be binding upon the Members (including former Members), Assignees (including former Assignees) and their respective Personal Representatives and shall inure to the benefit of the Members (including former Members), Assignees (including former Assignees), Managing Member Associates (including former Managing Member Associates), Liquidating Trustee Associates (including former Liquidating Trustee Associates), and their respective Personal Representatives (the "Parties"); provided, however, that this Section 12.3 shall not be construed to limit the requirements or effect of any other provision of this Agreement.

12.4Third Party Beneficiaries. The provisions of this Agreement are intended solely to govern the relations (a) between or among any two or more Parties; (b) between or among anyone or more Parties, on the one hand, and the Company, on the other hand; and (c) between or among any Member, on the one hand, and any Member, on the other hand. No Person (other than a Party) who owes any debts, liabilities or obligations to or who otherwise has any claim against or dealing with the Company shall obtain any rights under any provision of this Agreement, whether as third party beneficiary or otherwise. No creditor of a Party shall have the right to obtain possession of, or otherwise exercise legal or equitable remedies with respect to, Assets or the assets associated with the Company.

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12.5Remedies for Breach; Effect of Waiver or Consent. A waiver or consent, express or implied, of or to any breach or default by any Person in the performance by that Person of his duties with respect to the Company is not a waiver of or consent to any other breach or default in the performance by that Person of the same or any other duties of that Person with respect to the Company. Failure on the part of a Person to complain of any act of any other Person or to declare any other Person in default with respect to the Company, irrespective of how long that failure continues, shall not constitute a waiver by that Person of its rights with respect to that default until the applicable statute of limitations period has run.

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IN WITNESS WHEREOF, the undersigned have executed this Limited Liability Company Agreement as of the date first written above.

MANAGING MEMBER:

SREIF MANAGER II, LLC, a Nevada limited liability company

By:

Name:  Matthew Sullivan

On behalf of:  Crowdventure, LLC

Title:  Manager

MEMBERS:

Each Person hereafter admitted as a Member pursuant to the Managing Member's acceptance of such Person's Subscription Agreement or another document that has been duly executed by such Person in which such Person has agreed to be bound hereby as a Member.

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ANNEX A

DEFINITIONS

"Account" or "Capital Account" of a Member is defined in Section 7.1.

"Accounting Period" – an Accounting Period as set forth in Section 8.2.

"Act" – the Delaware Limited Liability Company Act, 6 Del. C. Section 18-101 et seq.

"Additional Manager" is defined in Section 3.4(b).

"Adverse Regulatory Effect" – means any of the following: (i) a violation by the Company or the Managing Member of any requirement, condition or guideline contained in any federal, state, local or foreign law or in any order, directive, opinion, ruling or regulation of any Governmental Entity or self-regulatory organization, (ii) the imposition of a requirement that the Company, the Company or the Managing Member comply with any requirement, condition or guideline contained in any federal, state, local or foreign law or in any order, directive, opinion, ruling or regulation of any Governmental Entity or self-regulatory organization, to which it is not subject as of the date of this Agreement; (iii) the termination ' classification as a partnership for federal income tax purposes, (iv) the Company being treated as a "publicly traded partnership" within the meaning of Section 7704 of the Code and applicable Treasury Regulations, (v) any of the assets of the Company being treated as Plan Assets, (vi) the imposition of a requirement on the Company  to register as an investment company under the 1940 Act; (vii) the imposition of a requirement on the Company  to comply with any provision of the 1940 Act (other than provisions applicable to a company that relies on Section 3(c)(1) of the 1940 Act, if the Company relies on that section, or Section 3(c)(7) of the 1940 Act, if the Company relies on that section), or (viii) the occurrence of any "prohibited transaction" (within the meaning of Section 406 of ERISA or Section 4975(c) of the Code).

"Advisers Act" – the Investment Advisers Act of 1940, as amended.

"Affiliate" of a specified Person – any Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person.

"Agreed Value" of a Capital Contribution in a form other than cash – the value of such Capital Contribution as mutually agreed by the Managing Member and the Person that makes such Capital Contribution.

"Agreement" – this Second Amended and Restated Limited Liability Company Agreement (including the documents incorporated herein by reference pursuant to Section 12.1(a)), as amended and/or restated from time in accordance with Section 10.1.

"Assets" – all of the assets associated of the Company, including Investments and any accrued interest and dividends receivable in respect of such Investments; provided, however, that no value shall be placed on the name or goodwill of the Company, which shall be considered the exclusive property of the Managing Member.

"Assets Under Management" – All Company assets, including, but not limited to, Loans, Loan Interests and other Company investments, un-invested Capital Contributions, Company income, interest payments, Loan Payments and cash.

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"Assignee" is defined in Section 5.4(b)(ii)(A).

"Authorized Person" is defined in Section 8.6(b)(i).

"Bankruptcy" of a Person – (i) such Person (A) makes an assignment for the benefit of creditors; (B) files a voluntary petition in bankruptcy; (C) is adjudged a bankrupt or insolvent, or has entered againstit an order for relief, in any bankruptcy or insolvency proceeding; (D) files a petition or answer seeking for itself any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any statute, law or regulation; (E) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against it in any proceeding of such nature; or (F) seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of such Person or of all or any substantial part of its properties; or (ii) one hundred and twenty (120) calendar days after the commencement of any proceeding against such Person seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any statute, law or regulation, the proceeding has not been dismissed, or if within ninety (90) calendar days after the appointment without such Person's consent or acquiescence of a trustee, receiver or liquidator of such Person or of all or any substantial part of its properties, the appointment is not vacated or stayed, or within ninety (90) calendar days after the expiration of any such stay, the appointment is not vacated. Without limiting the scope of the foregoing, if a Person is a partnership, Bankruptcy of such Person shall also include the Bankruptcy of any general partner of such Person.

"Benefit Plan Investor" means, as defined in the Pension Protection Act of 2006 ("PPA 2006"),

(i) any employee benefit plan subject to Part 4 of Title I of ERISA (regarding fiduciary responsibility), (ii) any plan to which Section 4975 of the Code applies (including Individual Retirement Accounts, i.e. IRAs) and (iii) any entity whose underlying assets include plan assets by reason of a plan's investment in such entity. For purposes of (iii) above, an entity's underlying assets will include plan assets if immediately after the most recent acquisition or disposition of any equity interest in such entity, 25% or more of a class of such entity's "equity interests" are owned by Benefit Plan Investors and such "equity interests" are not "publicly-offered securities" (as the terms "equity interests" and "publicly-offered securities" are used in Department of Labor ("DOL") Regulation 29 CFR §2510.3-101 and as subsequently modified by PPA 2006); provided that an entity which is primarily engaged, directly or through a majority owned subsidiary or subsidiaries, in the production or sale of a product or service other than the investment of capital shall not be considered a Benefit Plan Investor. Benefit Plan Investors include, by way of example and not of limitation, corporate pension and profit sharing plans, "simplified employee pension plans," Keogh plans for self-employed individuals (including partners), individual retirement accounts, and certain bank commingled trust funds, or insurance company separate accounts, for such plans and accounts. Notwithstanding anything herein to the contrary, whether an entity is a Benefit Plan Investor shall be determined under the rules set forth in DOL Regulation 29 CFR §2510.3- 101, but only to the extent such regulations are not inconsistent with PPA 2006 and only until such time as the DOL issues new regulations consistent with PPA 2006, at which time, such superseding regulations shall control the determination of Benefit Plan Investor.

"Book/Tax Disparity" of a Member or Assignee – the difference between the (aggregate) balance of such Member's or Assignee's Capital Account and the balance of such Member's or Assignee's Tax Basis Capital Account.

"Book Value" - with respect to any Investment, the asset's adjusted basis for federal income tax purposes, except that the Book Values of all Investments shall be adjusted to equal their respective Fair Market Values, in accordance with the rules set forth in Section 1.704-1(b)(2)(iv)(f) of the Treasury Regulations, except as otherwise provided herein, immediately prior to: (a) the date of the acquisition of any additional Interest by any new or existing Partner in exchange for more than a de minimis Capital Contribution; (b) the date of the actual distribution of more than a de minimis amount of Company property (other than a pro rata distribution) to a Member; or (c) the date of the actual liquidation of the Company within the meaning of Section 1.704-1(b)(2)(ii)(g) of the Treasury Regulations; provided that adjustments pursuant to clauses (a) and (b) above shall be made only if the Managing Member determines in its sole discretion that such adjustments are necessary or appropriate to reflect the relative economic interests of the Partners. The Book Value of any Company Investment distributed to any Member shall be adjusted immediately prior to such distribution to equal its Fair Market Value. The Book Value of any Investment shall be adjusted to reflect any write-down which constitutes a Disposition.

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"Business Day" – for purposes of this Agreement (excluding, for this purpose, any Authorizing Resolution or other document incorporated by reference herein), means any day that is not a Saturday or Sunday and is not a legal holiday or day on which banking institutions generally are authorized or obligated by law or regulations to remain closed in New York, California or Nevada.

"Capital Contribution" the amount of money (or, if the Managing Member determines in its sole and absolute discretion in any particular case that a contribution of capital may be made in whole or in part in the form of property other than cash, the Agreed Value of such other property, net of any liability secured by such property) contributed by a Person to the capital of the Company (including any reinvested amounts of allocated Net Income), less the amount of any sales charge deducted from such contribution and paid to another Person.

"Capital Withdrawal" from a Capital Account – any distribution of cash or other property from such Capital Account to the Member or Assignee who holds such Account and any withdrawal of cash or other property from such Capital Account (if allowed by the Managing Member), pursuant to this Agreement (including distributions pursuant to the provisions of Article 11). Each Capital Withdrawal from a Capital Account shall be deemed to be effected as of the end of the Accounting Period, notwithstanding that a distribution in connection with such Capital Withdrawal is made after the end of such Accounting Period. For the avoidance of doubt, a distribution shall not include any amount constituting reasonable compensation for present or past services. The amount of a Capital Withdrawal from a Capital Account shall be the amount of cash distributed in connection with such withdrawal (to the extent cash is distributed in connection with such withdrawal) plus the net value of any assets associated that are distributed in connection with such withdrawal (to the extent assets associated are distributed in connection with such withdrawal).

"CE Act" – the Commodity Exchange Act, as amended.

"Certificate" – the Certificate of Formation of the Company as originally filed in the office of the

Secretary of State of the State of Delaware and as subsequently amended and/or restated from time to

time in accordance with this Agreement and the Act.

"Class A Interest" means an Interest that has been designated as Class A.

"Class B Interest" means an Interest that has been designated as Class B.

"Class A Member" means a Member holding a Class A Interest.

"Class B Member" means the Managing Member as the sole holder of the Class B Interests.

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"Class A Preferred Return" is an amount equal to eight percent (8%) per annum of the total amount of unreturned Capital Contributions (including reinvested Net Income) from the inception date of a Member's initial Capital Contribution.

"Class Percentage" means, for any Member of a Class, a fraction, expressed as a percentage, the numerator of which fraction shall be the Capital Account balance of such Member and the denominator of which fraction shall be the total Capital Account balance of all Members of the Class, as may be amended from time to time upon the transfer, issuance or redemption of Interests in the Company accordance with this Agreement.

"Code" – the Internal Revenue Code of 1986, as amended.

"Confidential Information" is defined in Section 8.6(a).

"Company" – Secured Real Estate Income Fund II, LLC, the Delaware limited liability company whose formation was completed upon the filing of the Certificate and whose business and affairs shall be governed by this Agreement.

"Control" – when used with respect to a particular Person, means the possession, directly or

indirectly, of the power to direct or cause the direction of the management and policies of such Person,

whether through the ownership of voting securities, by contract or otherwise.

"Disposition" – the sale, exchange, redemption, assignment, transfer, repayment, repurchase or other disposition by the Company of all or any portion of a Company Investment. A Disposition shall be deemed to include a Company Investment becoming worthless within the meaning of section 165(g) of the Code or written down in accordance with GAAP to reflect an impairment in value that in the good faith judgment of the Managing Member is permanent (to the extent of any such write-down only).

"Entity" – any domestic or foreign corporation, partnership (whether general or limited), joint

venture, limited liability company, business trust, trust, estate, custodian, Governmental Entity,

cooperative or other entity, or any unincorporated association or organization or account, whether acting

in an individual or representative capacity.

"ERISA" – the Employee Retirement Income Security Act of 1974, as amended.

"Fair Market Value" – (a) as to any Loan or Loan Interest, the outstanding amount of unpaid principal plus any accrued by unpaid interest and fees on such date of valuation, and (b) as to any other property on any date, the fair market value of such property on such date as determined by an independent appraisal firm selected by the Managing Member or as otherwise determined in good faith by the Managing Member.

"Fiscal Quarter" – a fiscal quarter of a fiscal year.

"Fiscal Year" – the fiscal year is the calendar year ending on December 31^st.

"Governmental Entity" – any federal, state, local or foreign government (or political subdivision, department, instrumentality, body or agency thereof).

"Indemnification Obligation" – an obligation of the Company to indemnify an Indemnitee, advance expenses of an Indemnitee or provide contribution with respect to an Indemnitee, as the case may be, pursuant to Article 9.

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"Indemnitee" is defined in Section 9.2(a).

"Initial Closing" the first day on which the Company admits a Person (other than the Managing Member) as a Member thereof pursuant to this Agreement.

"Interest" means a "limited liability company interest" (as such term is defined in Section 18‑101(8) of the Act) in the Company, including any and all rights and benefits to which the holder of such an interest may be entitled as provided in this Agreement and any applicable supplement and/or addendum hereto (e.g., right to receive distributions of Company assets and allocations of income, gain, loss, deduction, credit and similar items from the Company), together with all obligations of such holder to comply with the terms and provisions of this Agreement and any applicable supplement and/or addendum hereto.  The Interests shall include both "Class A Interests" and "Class B Interests".

"Investment" means, as appropriate, any investment made by the Company in a Loan or Loan Interest.

"Investment Company Act" means the U.S. Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.

"Investment Manager" means Good Steward Capital Management, Inc.

 "Investment Management Agreement" means that certain agreement between the Company, the Managing Member and the Investment Manager relating to the investment management of the Company.

"Investment Period" –the period commencing upon the Initial Closing date in which the Company receives the Minimum Investment Amount and ending upon winding up of the Company.

"Judicially Determined" – determined in a judgment or order, not subject to further appeal or discretionary review, by a court, governmental body or agency or self-regulatory organization having jurisdiction to render or issue such judgment or order.

"Liabilities" (i) all of the Company's bills and accounts payable; (ii) all of the Company's accrued or payable expenses described in Section 5.5; and (iii) all of the Company's other liabilities, present or future, including any Reserves.

"Liquidating Trustee" is defined in Section 11.2(a).

"Liquidating Trustee Associate" – the Liquidating Trustee, any Affiliate of the Liquidating Trustee, and any member, partner, shareholder, other beneficial owner, manager, director, officer, employee or agent of the Liquidating Trustee or any such Affiliate and their Personal Representatives.

"Losses" is defined in Section 9.2(a).

"Loan" means a loan extended, originated or purchased by the Company, which loan consists of the Note, the security instrument (deed of trust, mortgage, security deed or security agreement), personal and corporate guarantees and such other documentation evidencing the extension of money to a borrower and the securing of the collateral.

"Loan Interests" means a whole, fractional or participation interest in a Loan.

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"Majority in Interest" of the Members as of the beginning of an Accounting Period (other than Members who are also Managing Member Associates) the Opening Balances of whose Capital Accounts at such time exceed fifty percent (50%) of the Opening Balances of the Capital Accounts at such time of all Members (other than Members who are also Managing Member Associates).

"Manager" means a "manager" within the meaning of Section 18-101(10) of the Act.

"Managing Member" – SREIF MANAGER II, LLC and any Additional Manager that acts as the Manager of the Company, to the extent that the Managing Member, pursuant to Section 3.4(c), provides that such Additional Manager shall possess any one or more of the rights, powers and authority of SREIF MANAGER II, LLC in its capacity as a Manager of the Company under this Agreement.

"Managing Member Associate" – the Managing Member, each Affiliate of the Managing Member, each member, partner, shareholder, other beneficial owner, manager, director, officer, employee

or agent of the Managing Member or any such Affiliate, and the Personal Representatives of each of the foregoing.

"Member"  as of a particular time – a Person who has been admitted as a Class A Member in accordance with this Agreement and who has not, pursuant to this Agreement, (i) withdrawn all amounts from its Capital Account, (ii) resigned or withdrawn as a Class A Member, (iii) been required to withdraw as a Class A Member or (iv) assigned its entire Interest to a substitute Class A Member pursuant to Section 5.4(b)(ii)(A).

"Offering Circular" the Offering Circular filed as Part II of Form 1A filed with the Securities and Exchange Commission as in effect at the time of the Initial Closing (if any), together with (i) any amendment(s) thereto and (ii) any supplement(s) thereto, prepared by or under the direction of the Managing Member describing the Company, the Managing Member and the offer and sale of Interests.

"Minimum Investment Amount" $5,000.

"Minimum Capital Amount" $500,000.

"Net Asset Value" at a particular time – the value of the Investments and other assets at such time minus the amount of the Company' liabilities at such time (in each case determined in accordance with generally accepted accounting principles consistently applied (except as provided in this Agreement or the Offering Circular (if any) and Section 8.3). For purposes of determining Net Asset Value, the value of a Loan Interest will at all times be equal to the amount of principal, plus any accrued but unpaid interests and fees due and owing on a performing Loan Interest on the date of valuation.  Loan Interests that are in default for periods of more than three (3) months, shall be considered non-performing and shall be valued in connection with the Company's annual audit or as otherwise valued by the Managing Member.  In the event that the Company acquires Non-Performing Loan Interests, then the value of such Loan Interests shall be the cost basis plus accrued but unpaid interest thereon.  Real estate owned as a result of a foreclosure and all other Company Investments other than Loan Interests shall be assessed a value by the Managing Member or Investment Manager using acceptable valuation methods no less than annually and shall maintain such valuation until adjusted by virtue of a subsequent appraisal, valuation event or the liquidation of the asset. The value of each Company Investment and the Company's Net Asset Value as determined above will be conclusive and binding on all of the Partners and all parties claiming through or under them.

"Net Income"with respect to the Company, theincome generated with respect to the Company's Investments, less any Company Liabilities associated with such Investments.

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"1940 Act" – the Investment Company Act of 1940, as amended.

"1934 Act" – the Securities Exchange Act of 1934, as amended.

"1933 Act" – the Securities Act of 1933, as amended.

"Non-Performing Loan Interest" – a Loan Interest which has been in default pursuant to the terms thereof for a period of more than three (3) months.

"Notification" to a Person – a written notice that is deemed to be duly given to such Person on: (i) the date of delivery, if delivered by hand to such Person or sent to such Person by facsimile transmission (provided confirmation of receipt thereof is obtained) or reputable overnight courier; or (ii) the date indicated as the date of receipt on the return receipt, if mailed to such Person by U.S. registered or certified mail (first class postage prepaid), return receipt requested. Any Notification required or permitted to be given to the Managing Member or the Company shall be sent to the principal office of the Company, or to such other address or facsimile number as the Managing Member may specify in a Notification given to all other Members and Assignees. Any Notification required or permitted to be given to any other Member or Assignee shall be sent to such Member or Assignee at such address or to such facsimile number as such Member or Assignee may notify the Company by way of a Notification (it being understood and agreed that a Subscription Agreement, duly executed by a Person who subscribes for a Company Interest pursuant thereto, shall constitute a Notification by such Person of its address and facsimile number).

"Party" is defined in Section 12.3.

"Person" – any natural person, whether acting in an individual or representative capacity, or any Entity.

"Personal Representative" is defined in Section 18-101(13) of the Act.

"Plan Assets" – money or other property in which a Benefit Plan Investor is deemed to have an ownership interest for purposes of ERISA or Section 4975 of the Code.

"Proceeding" – any claim, demand, action, suit or proceeding (including any action by or in the right of the Company), civil, criminal, administrative or investigative, brought by or before (or threatened to be brought by or before) any court, arbitrator, mediator, governmental body or agency or self-regulatory organization, that directly or indirectly arises from or relates to this Agreement, the business or affairs of the Company or a Member's or Assignee's investment.

"Proprietary Information" is defined in Section 8.6(e)(i).

"Regular Income Distribution" is defined in Section 6.1(b).

"Required Records" is defined in Section 8.1(a).

"Reserves" is defined in Section 8.3(d).

"Securities and Commodities Laws" – any one or more of the Advisers Act, the 1933 Act, the 1934 Act, the 1940 Act and the CE Act, to the extent each is applicable to the Managing Member or the Company.

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"Subscription Agreement" of a Person – the Subscription Agreement and Power of Attorney (and related documents) in such form or forms as the Managing Member may from time to time determine, as completed and executed by such Person and delivered by such Person to the Company, pursuant to which such Person (i) subscribes for an Interest by agreeing to contribute capital in such amount or amounts, at such time or times and otherwise in such manner as may be set forth therein; and (ii) agrees to be bound by this Agreement as a Member.

"State" is defined in Section 18-101(14) of the Act.

"Subsequent Closing" any closing that takes place after the Initial Closing.

"Target Investment Amount" $50,000,000 or such other amount set forth in the Offering Circular.

"Tax Item" – any item of income, gain, expense, deduction, loss or credit allocable to Members and Assignees for federal income tax purposes.

"Tax Laws" is defined in Section 8.5(b).

"Tax Returns" is defined in Section 8.5(a).

"Transfer" of an Interest or an interest therein – (i) any transaction in which a Person assigns or purports to assign an Interest, or an interest therein, to another Person, and includes: (A) any transfer, sale, assignment, gift, exchange, pledge, mortgage or hypothecation of an Interest, or any interest therein; (B) the creation or granting of a security interest, lien or encumbrance in, on or against an Interest, or any interest therein; or (C) any other conveyance or disposition of an Interest, or an interest therein, whether voluntary, involuntary or by operation of law; and (ii) any agreement, including a structured note or swap transaction, under which a Member or Assignee agrees to: (A) grant any other Person an economic interest in such Member's or Assignee's Capital Account or (B) pay any person an amount determined in whole or in substantial part by reference to the change in value of a Capital Account or to the performance of the Company.

"Treasury Regulations" – the income tax regulations promulgated under the Code, whether in proposed, temporary or final form.

"Withdrawal Date" in respect of a Capital Account – the date as of which a Capital Withdrawal is effected from such Account.

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EXHIBIT A

REDEMPTION NOTICE

This Redemption Notice ("Redemption Notice") is made this ___ day of _____________, 20___, by ________________________ (the "Redeemed Investor"), and directed to SREIF Manager II, LLC, a Nevada limited liability company ("Company").

This Redemption Notice is executed with reference to the following:

A.On or about the ___ day of _____________, 20__, the Redeemed Investor, on the one hand, and Company, on the other hand, entered into that certain Subscription Agreement ("Subscription Agreement"), whereby the Redeemed Partner purchased certain Class A Membership Interests ("Interests") in the Company and became a party to the Company's Operating Agreement (the "Operating Agreement") pursuant to which the Company extended certain financial rights to Redeemed Investor.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the Redeemed Investor acknowledges and agrees as follows.

1.Redemption.  The Company agrees to redeem Interests in the amount of $_____ ("Redemption Amount").  The redemption of the Interests and the timing and payment of the Redemption Amount shall be governed by the Article VI of the Operating Agreement.

2.Rights of Redeemed Investor.  The Redeemed Investor and Company acknowledge and agree that upon Company's receipt of this executed Redemption Notice signed by the Redeemed Investor (or the Redeemed Investor's personal representative or other successor, if applicable), the rights of the Redeemed Investor shall be governed by the Operating Agreement.

3.Released Matters.  The claims released pursuant to this Redemption Notice (the "Released Claims") include all claims between the Redeemed Investor, on the one hand, and the Company, on the other hand, including but not limited to principal, interest, charges, fees, together with any and all other claims, demands, obligations, liabilities, indebtedness, responsibilities, disputes, breaches of contract, breaches of duty or any relationship, acts, omissions, misfeasance, malfeasance, cause or causes of action (whether at law or in equity), debts, sums of money, accounts, compensations, contracts, controversies, promises, damages, costs, rights of offset, losses and expenses, of every type, kind, nature, description or character, known and unknown, whensoever arising and occurring at any time up to and through the date hereof, whether known or unknown, suspected or unsuspected, liquidated or unliquidated, matured or unmatured, fixed or contingent, which in any way arise out of, are connected with or relate to the Loan Documents.

5.Release by Redeemed Investor.  Upon receipt of the Redemption Amount, the Redeemed Investor and each of its predecessors, successors and assigns, hereby fully, finally, irrevocably, forever and unconditionally release, discharge, and acquit Company from all released claims, except the rights and obligations under this Redemption Notice.

6.No Assignment.  The Redeemed Investor agrees, represents, and warrants that such party has not voluntarily, by operation of law or otherwise, assigned, conveyed, transferred or encumbered, either directly or indirectly, in whole or in part, any right to or interest in any of the Released Claims.

7.Choice of Law; Severability. This Redemption Notice shall be governed by and construed in accordance with the laws of the State of Delaware as applied to agreements among parties resident therein.

8.Advice of Counsel.  The Redeemed Investor has had advice of independent counsel of its own choosing in negotiations for and the preparation of this Redemption Notice, has read this Redemption Notice in full and final form, and has had this Redemption Notice fully explained to it to its satisfaction.

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9.No Third Party Beneficiaries. This Redemption Notice is executed for the Redeemed Investor hereto, and no other person, corporation, partnership, individual or other entity not a party to this Redemption Notice shall have any rights herein as a third party beneficiary or otherwise, except to the extent expressly and specifically provided herein.

10.Counterparts. This Redemption Notice may be executed in duplicates and counterparts, which, taken together, will be deemed and serve as an original. In addition, the parties agree that their authorized representatives may bind them to the terms of this Redemption Notice with signatures exchanged by fax, and each duplicate faxed signature copy shall be deemed to be an original of this Redemption Notice.

11.Entire Agreement. This is the entire Redemption Notice with respect to this matter. There are no other agreements or understandings, written or oral, express or implied.

IN WITNESS WHEREOF, the Redeemed Investor has caused this Redemption Notice to be executed and delivered by their duly authorized representative.

Dated:  _____________, 20___

Redeemed Investor:

Signed: _________________________

Printed: _________________________

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EX1A-4 SUBS AGMT

SUBSCRIPTION AGREEMENT

This Subscription Agreement (this "Agreement") is entered into by and between the Secured Real Estate Income Fund II, LLC, a Delaware limited liability company (the "Company") and the subscriber who executes this Agreement (the "Subscriber"), effective as of the date of the Subscriber's signature (electronic or otherwise) to this Agreement.  In consideration of the mutual covenants set forth in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Subscriber and the Company hereby agree as follows.

1.Subscription.

(a)Certain Capitalized terms not defined herein shall have the meanings set forth on Exhibit A, attached hereto.

(b)Subject to the terms and conditions hereof, the Subscriber hereby irrevocably tenders this subscription (this "Subscription") for units of Class A membership interests in the Company (a "Class A Units") by paying the amount agreed upon by the Company and the Subscriber ("Subscription Amount").  The Company is offering the Class A Units pursuant to the Company's Form 1A and Offering Circular (the "Circular") and the terms and conditions set forth therein.

(c)This Subscription, when and if accepted by the Company, as manager of the Company, will constitute a commitment to contribute to the Company that portion of the Subscription Amount accepted by the Company (the "Commitment") in accordance with terms of the Operating Agreement of the Company, as the same may be further amended from time to time (the "Company Agreement"), in accordance with the Delivery Instructions attached hereto as Exhibit B.  The Subscriber shall be admitted as a Member in the Company ("Member") at the time this Subscription is accepted and executed by the Company and the Subscriber hereby irrevocably agrees to be bound by the Company Agreement as a Member thereunder and to perform all obligations thereunder, including making contributions to the Company in accordance with the terms thereof.

(d)The Managing Member, on behalf of the Company, may accept or reject this Subscription, in whole or in part, in its sole discretion.  This Subscription shall be deemed to be accepted by the Company and this Agreement shall be binding against the Company only upon the Company accepting the subscription.  At the Closing, the Subscriber shall be issued the Class A Units for which it has subscribed.

(e)The Company has the unrestricted right to condition its acceptance of the Subscriber's subscription, in whole or in part, upon the receipt by the Company of any additional instruments (including any designations, representations, warranties, covenants), documentation and information requested by the Company in its sole discretion, including an opinion of counsel to the Subscriber, evidencing the legality of an investment in the Company by the Subscriber and the authority of the person executing this Agreement on behalf of the Subscriber (collectively the "Additional Documents"), in addition to these Subscription Documents.

(f)The Subscriber understands that the Company has entered into or expects to enter into separate subscription agreements with other investors which are or shall be substantially similar in all material respects to this Agreement providing for the admission of such other investors as Members in the Company.  This Agreement and such separate subscription agreements are separate agreements and the sale arrangements between the Company and such other investors are separate sales.  The Subscriber also acknowledges that the Company may enter into side letters with certain Members (which may include the Subscriber) which contain terms different from those in this Agreement or amend and supplement certain provisions of the Company Agreement as it applies to such Members.

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2.Representations and Warranties of the Subscriber.

The Subscriberhereby represents and warrants to the Company as of the date of this Agreement and as of the date of any capital contribution to the Company (and the Subscriber agrees to notify the Company in writing immediately if any changes in the information set forth herein occur):

(a)The Subscriber represents that it is a "Qualified Purchaser", meaning Subscriber is either (i) an "Accredited Investor" within the meaning of Rule 501 under the Securities Act of 1933 (the "Securities Act") in accordance with Exhibit C, (ii) a non-accredited investor and the investment in the Class A Units does not represent more than 10% of the greater of Subscriber's annual income or net worth (for natural persons), or 10% of the greater of annual revenue or net assets at fiscal year-end (for non-natural persons).

(b)The Subscriber is purchasing the Class A Units solely for the Subscriber's own account for investment purposes only and not with a view to the sale or distribution of any part or all thereof by public or private sale or other disposition.  The Subscriber understands that no public market exists for the Class A Units and that the Class A Units may have to be held for an indefinite period of time.  The Subscriber has no intention of selling, granting any participation in or otherwise dividing, distributing or disposing of any portion of the Class A Units, except that participants in and beneficiaries of any Subscriber that is a Qualified Plan Investor (as defined below) shall benefit as provided in plan documents.

(c)The Subscriber (either alone or with the Subscriber's professional advisers who are unaffiliated with the Company, the Managing Member, or its affiliates) has such knowledge, sophistication and experience in financial and business matters that the Subscriber is capable of evaluating the merits and risks of an investment in the Class A Units and has the capacity to protect the Subscriber's own interest in connection with the Subscriber's proposed investment in the Class A Units.  The Subscriber understands that an investment in the Class A Units is highly speculative and the Subscriber is able to bear the economic risk of such investment for an indefinite period of time and the loss of the Subscriber's entire investment.

(d)All questions of the Subscriber related to the Subscriber's investment in the Class A Units have been answered to the full satisfaction of the Subscriber and the Subscriber has received all the information the Subscriber considers necessary or appropriate for deciding whether to purchase the Class A Units.

(e)This Agreement, upon acceptance by the Company, will constitute a valid and legally binding obligation of the Subscriber, enforceable in accordance with its terms except to the extent limited by applicable bankruptcy, insolvency, reorganization or other laws affecting the enforcement of creditors' rights generally and by principles of equity.

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(f)If the Subscriber is a natural person, the Subscriber (i) has full legal capacity to execute and deliver this Agreement and to perform the Partner's obligations hereunder and (ii) is a bona fide resident of the state of residence provided to the Company or its agent and has no present intention of becoming a resident of any other state or jurisdiction.

(g)If the Subscriber is not a natural person, the Subscriber (i) is duly organized and has all requisite power to execute and deliver this Agreement and perform its obligations hereunder, (ii) has taken all necessary action to duly authorize the execution, delivery and performance of this Agreement and (iii) was not organized for the specific purpose of acquiring the Class A Units.

(h)Other than as set forth herein or in the Company Agreement (and any separate agreement in writing with the Company executed in conjunction with the Subscriber's subscription for the Class A Units), the Subscriber is not relying upon any information, representation or warranty by the Company, the Managing Member or any of its respective agents or representatives in determining to invest in the Company. The Subscriber has consulted, to the extent deemed appropriate by the Subscriber, with the Subscriber's own advisers as to the financial, tax, legal and other matters concerning an investment in the Class A Units and on that basis and the basis of its own independent investigations, without the assistance of the Company, the Managing Member or any of its respective agents or representatives, believes that an investment in the Class A Units is suitable and appropriate for the Subscriber. Subscriber hereby represents and warrants that it has had the opportunity for its legal counsel review the legal documents executed in connection with its Subscription.

(i)The Subscriber acknowledges that it has received a copy of the Circular.  The Circular contains a "Conflicts of Interest" section which states that (i) the Managing Member and its affiliates (A) may carry on investment activities for their own accounts, for family members and friends who do not invest in the Company; (B) may give advice and recommend investments to their respective family and friends that differs from advice given to, or investments recommended or bought for, the Company, even though their business or investment objectives may be the same or similar; (C) will be engaged in activities, including investment activities, apart from their management of the Company as permitted by this Agreement and (D) may direct the Company to extend loans to, purchase loans from or make investments into entities which are owned, managed, or controlled by the Managing Member and its affiliates or, as a result of which, the Managing Member or its affiliates will receive a financial benefit; (ii) certain employees of the Managing Member are expected to continue to perform services for the Managing Member and its affiliates, as well as for other entities, investment funds and accounts in such manner as the Managing Member, in its sole discretion, deems appropriate (subject to the limitations on the timing of such establishment, as described below); (iii) certain other selling, general and administrative expenses will be shared by the Company and companies affiliated with the Managing Member; (iv) the Company may co-invest with affiliates of the Managing Member; and (v) the Company may use affiliates of the Managing Member to provide certain services to the Company.

(j)The Subscriber understands and acknowledges that (i) any description of the Company's business and prospects given to the Subscriber is not necessarily exhaustive, (ii) all estimates, projections and forward-looking statements were based upon the best judgment of the Company's management at the time such estimates or projections were made and that whether or not such estimates, projections or forward-looking statements will materialize will depend upon many factors that are out of the control of the Company and (iii) there is no assurance that any projections, estimates or forward-looking statements will be attained.

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(k)The Subscriber's information provided to the Company is complete and accurate and may be relied upon by the Company and the Managing Member. Additionally, by executing the Subscription Agreement, the Subscriber acknowledges and agrees that any identifying information or documentation regarding the Subscriber and/or its suitability to invest in the Company that was furnished by the Subscriber to the Company, the Managing Member or their affiliates online, or via e-mail, whether in connection with this subscription or previously, may be made available to the Managing Member, remains true and correct in all respects and may, at the discretion of the Managing Member, be incorporated by reference herein (collectively, "Supporting Documents").

(l)Neither this Subscription nor any of the Subscriber's contributions of Commitments do or will directly or indirectly contravene applicable laws and regulations, including anti-money-laundering laws and regulations.  The Subscriber understands and agrees that the Company may undertake any actions that the Company deems necessary or appropriate to ensure compliance with applicable laws, rules and regulations regarding money laundering or terrorism. In furtherance of such efforts, the Subscriber hereby represents, covenants, and agrees that, to the best of the Subscriber's knowledge based on reasonable investigation:

(i)None of the Subscriber's capital contributions to the Company (whether payable in cash or otherwise) shall be derived from money laundering or similar activities deemed illegal under federal laws and regulations.

(ii)To the extent within the Subscriber's control, none of the Subscriber's capital contributions to the Company will cause the Company or any of its personnel to be in violation of federal anti-money laundering laws, including without limitation the Bank Secrecy Act (31 U.S.C. 5311 et seq.), the United States Money Laundering Control Act of 1986 or the International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001, and any regulations promulgated thereunder.

(iii)The Subscriber acknowledges that due to anti-money laundering requirements operating in the United States, as well as the Company's own internal anti-money laundering policies, the Company and the Managing Member may require further identification of the Subscriber and the source of its capital contribution before these Subscription Documents can be processed, capital contributions can be accepted or distributions made.  When requested by the Company, the Subscriber will provide any and all additional information, and the Subscriber understands and agrees that the Company may release confidential information about the Subscriber (and, if applicable, any underlying beneficial owner or Related Person1 to any person) if the Company has determined that such release is necessary to ensure compliance with all applicable laws and regulations concerning money laundering and similar activities; provided, that prior to releasing any such information, the Company shall confirm with counsel that such release is necessary to so ensure said compliance.

¹ For purposes of this subparagraph (c) and subparagraph (d) below, with respect to any entity, any interest holder, director, senior officer, trustee, beneficiary or grantor of such entity; provided that in the case of an entity that is a publicly traded company or a tax qualified pension or retirement plan in which at least 100 employees participate that is maintained by an employer that is organized in the U.S. or is a U.S. government entity (a "Qualified Plan"), the term "Related Person" shall exclude any interest holder holding less than 5% of any class of securities of such publicly traded company and beneficiaries of such Qualified Plan.

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(m)Except as otherwise disclosed in writing to the Company, the Subscriber represents and warrants that neither it, nor to the best of its knowledge and belief after due inquiry, the Beneficial Owners (as defined below), nor any person or entity controlled by, controlling or under common control with the Subscriber or the Beneficial Owners, nor any person having a beneficial or economic interest in the Subscriber or the Beneficial Owners, any person for whom the Subscriber is acting as agent or nominee in connection with this investment, nor in the case of a Subscriber which is an entity, any Related Person is:

(i)a Prohibited Investor;²

(ii)a Senior Foreign Political Figure,³ any member of a Senior Foreign Political Figure's "immediate family," which includes the figure's parents, siblings, spouse, children and in-laws, or any Close Associate⁴ of a Senior Foreign Political Figure, or a person or entity resident in, or organized or chartered under, the laws of a Non-Cooperative Jurisdiction;⁵

(iii)a person or entity resident in, or organized or chartered under, the laws of a jurisdiction that has been designated by the U.S. Secretary of the Treasury under Section 311 or 312 of the USA PATRIOT Act as warranting special measures due to money laundering concerns; or

(iv)a person or entity who gives the Subscriber reason to believe that its funds originate from, or will be or have been routed through, an account maintained at a Foreign Shell Bank,⁶ an "offshore bank," or a bank organized or chartered under the laws of a Non-Cooperative Jurisdiction.

² For purposes of this subparagraph (d), "Prohibited Investor" shall mean a person or entity whose name appears on (i) the List of Specially Designated Nationals and Blocked Persons maintained by the U.S. Office of Foreign Assets Control; (ii) other lists of prohibited persons and entities as may be mandated by applicable law or regulation; or (iii) such other lists of prohibited persons and entities as may be provided to the Company in connection therewith.

³ For purposes of this subparagraph (d), "Senior Foreign Political Figure" shall mean a senior official in the executive, legislative, administrative, military or judicial branches of a foreign government (whether elected or not), a senior official of a major foreign political party, or a senior executive of a foreign government-owned corporation.  In addition, a Senior Foreign Political Figure includes any corporation, business or other entity that has been formed by, or for the benefit of, a Senior Foreign Political Figure.

⁴ For purposes of this subparagraph (d), "Close Associate of a Senior Foreign Political Figure" shall mean a person who is widely and publicly known internationally to maintain an unusually close relationship with the Senior Foreign Political Figure, and includes a person who is in a position to conduct substantial domestic and international financial transactions on behalf of the Senior Foreign Political Figure.

⁵ For purposes of this subparagraph (d), "Non-Cooperative Jurisdiction" shall mean any foreign country that has been designated as non-cooperative with international anti-money laundering principles or procedures by an intergovernmental group or organization, such as the Financial Task Force on Money Laundering, of which the U.S. is a member and with which designation the U.S. representative to the group or organization continues to concur.

⁶ For purposes of this subparagraph (d), "Foreign Shell Bank" shall mean a Foreign Bank without a Physical Presence in any country, but does not include a Regulated Affiliate.

A "Foreign Bank" shall mean an organization that (i) is organized under the laws of a foreign country, (ii) engages in the business of banking, (iii) is recognized as a bank by the bank supervisory or monetary authority of the country of its organization or principal banking operations, (iv) receives deposits to a substantial extent in the regular course of its business, and (v) has the power to accept demand deposits, but does not include the U.S. branches or agencies of a foreign bank.

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(n)The Subscriber understands the rights, obligations and restrictions of Members, including that withdrawals of capital from the Company by Members are limited by the terms of the Company Agreement.

(o)The Subscriber understands that the Company intends to operate in such a manner that (i) an investment in the Company will be a permissible investment for Qualified Plan Investors and (ii) the Company will qualify for an exemption from the "look through" rule of the Plan Asset Regulations (U.S. Department of Labor regulation 20 C.F.R. section 2510.3‑101), including limiting the holdings of Qualified Plan Investors to less than 25 percent of the Class A Units.

(p)If the Subscriber is or would be an investment company (as defined by the Company Act) but for the exceptions contained in section 3(c)(1) or section 3(c)(7) of the Company Act, (i) the Subscriber's Class A Units does not represent 40% or more of the total assets and committed capital of the Subscriber, (ii) the Subscriber has informed the Company of the number of persons that constitute "beneficial owners" of such Subscriber's outstanding securities (other than short-term paper) within the meaning of clause (A) of subsection 3(c)(1) of Company Act, and will inform the Company promptly upon any change in that number and (iii) the Subscriber agrees that the Company may require the Subscriber to withdraw at any time so much of its Class A Units as is necessary to keep such Class A Units below 10% of the total Class A Units.

(q)If the Subscriber is an "employee benefit plan" as defined in section 3(3) of the U.S. Employee Retirement Income Security Act of 1974, as amended ("ERISA"), a plan with respect to which section 4975 of the Internal Revenue Code, as amended (the "Code") applies or an entity or account whose assets are deemed to include assets of any such plan (a "Qualified Plan Investor"), (i) the Subscriber has completed and complied with the instructions set forth in Exhibit D to this Agreement, making the representations and warranties referenced therein and (ii) if the Company or any partner, employee or agent of the Company is ever held to be a fiduciary, the fiduciary responsibilities, if any, of that person shall be limited to the person's duties in administering the business of the Company, and such person shall not be responsible for any other duties with respect to any Qualified Plan Investor.

(r)The Subscriber understands the meaning and legal consequences of the representations and warranties made by the Subscriber herein, and that the Company is relying on such representations and warranties in making its determination to accept or reject this Agreement.

3.Certificates.  The Subscriber understands and agrees that, as permitted by applicable law, the Class A Units will not be represented by a certificate unless otherwise determined by the Company.  If the Managing Member determines to have the Class A Units be represented by a certificate, such certificate shall bear such legends as the Company considers advisable to facilitate compliance with the Securities Act or any other securities law or any other restrictions placed on such Class A Units.

"Physical Presence" shall mean a place of business that is maintained by a Foreign Bank and is located at a fixed address, other than solely a post office box or an electronic address, in a country in which the Foreign Bank is authorized to conduct banking activities, at which location the Foreign Bank (i) employs one or more individuals on a full-time basis, (ii) maintains operating records related to its banking activities, and (iii) is subject to inspection by the banking authority that licensed the Foreign Bank to conduct banking activities.

"Regulated Affiliate" shall mean a Foreign Shell Bank that is an affiliate of a depository institution, credit union or Foreign Bank that maintains a Physical Presence in the U.S. or a foreign country regulating such affiliated depository institution, credit union or Foreign Bank.

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4.Liability.  TheSubscriber agrees that neither the Company, the Managing Member nor any of their respective affiliates, nor their respective managers, officers, directors, members, equity holders, employees or other applicable representatives (collectively, the "Company, the Managing Member and their Affiliated Persons"), shall incur any liability (a) in respect of any action taken upon any information provided to the Company by the Subscriber (including any Supporting Documents or Additional Documents) or for relying on any notice, consent, request, instructions or other instrument believed, in good faith, to be genuine or to be signed by properly authorized persons on behalf of the Subscriber, including any document transmitted by email or (b) for adhering to applicable anti-money laundering obligations whether now or hereinafter in effect.

5.Indemnification.   To the extent permitted by law, the Subscriber agrees that it will indemnify and hold harmless the Company, the Managing Member, the Investment Manager and their respective Affiliated Persons from and against any and all direct and consequential loss, damage, liability, cost or expense (including reasonable attorneys' and accountants' fees and disbursements, whether incurred in an action between the parties hereto or otherwise, and including any liability which results directly or indirectly from the Company, the Managing Member, the Investment Manager and their respective Affiliated Persons becoming subject to ERISA or Section 4975 of the Code) (collectively, "Losses") which the Company, the Managing Member and their Affiliated Persons, or any one of them, may incur by reason of or in connection with these Subscription Documents (including any Supporting Documents and Additional Documents), including any misrepresentation made by the Subscriber or any of the Subscriber's agents (including, but not limited to, any misrepresentation of Subscriber's status under ERISA or the Code), any breach of any declaration, representation or warranty of Subscriber, the failure by the Subscriber to fulfill any covenants or agreements under these Subscription Documents, its or their reliance on email or other instructions, or the assertion of the Subscriber's lack of proper authorization from the Beneficial Owner(s) to execute and perform the obligations under these Subscription Documents.  The Subscriber also agrees that it will indemnify and hold harmless the Company, the Managing Member, Investment Manager and their respective Affiliated Persons from and against any and all direct and consequential Losses that they or any one of them, may incur (a) as provided in Section 10 below and (b) by reason of, or in connection with, the failure by the Subscriber to comply with any applicable law, rule or regulation having application to the Company, the Managing Member, the Investment Manager or their Affiliated Persons.

(a)the dissolution and termination of the Company in accordance with the Company Agreement.

6.Dispute Resolution.

(a)Notwithstanding anything to the contrary in this Agreement or the Company Agreement, and except for any claim or action that the Company may elect to commence in the Designated Courts to enforce any of its rights or the Subscriber's obligations under this Subscription Agreement or the Company Agreement, the Subscriber agrees that all disputes arising out of (i) this Agreement, (ii) the Company's offering of the Class A Units, (iii) the Subscriber's Subscription for the Class A Units and (iv) the Subscriber's rights and obligations under the Company Agreement shall be submitted to and resolved by binding arbitration in accordance with this Section 6.  The Subscriber acknowledges and agrees that the parties are waiving their right to seek remedies in court, including the right to jury trial.

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(b)The arbitration will be conducted in the Arbitration Location, and in accordance with Delaware law and the rules then in effect of the American Arbitration Association in accordance with its rules for commercial disputes before a single arbitrator appointed in accordance with such rules.  The award of the arbitrator shall be final and conclusive and judgment on the award rendered may be entered in any court having jurisdiction.

(c)No person will bring a putative or certified class action to arbitration, nor seek to enforce any pre-dispute arbitration agreement against the other party that has initiated in court a putative class action or that is a member of a putative class that has not opted out of the class with respect to any claims encompassed by the putative class action until (i) the class certification is denied, (ii) the class is decertified or (iii) the other party is excluded from the class by the court.  Such forbearance to enforce an agreement to arbitrate shall not constitute a waiver of any rights under this Agreement except if stated herein.

7.Waiver; Conflict of Interest.The Subscriber acknowledges and agrees that the Managing Member and its affiliates will be subject to various conflicts of interest in carrying out the Managing Member's responsibilities to the Company.  Affiliates of the Managing Member may also be in competition with the Company or its investments.  Other funds may be formed in the future with objectives that are the same as or similar to the Company's objectives.  Each Subscriber hereby waives any such conflicts of the Managing Member and its affiliates by executing this Subscription Agreement.

8.Confidentiality.  TheSubscriber shall keep confidential, and not make use of or disclose to any person (other than for purposes reasonably related to its interest in the Company or as required by law), any information or matter received from or relating to the Company; provided that the Subscriber may disclose any such information to the extent that such information (i) is or becomes generally available to the public through no act or omission of the Subscriber, (ii) was already in the possession of the Subscriber at the time of such disclosure or (iii) is communicated to the Subscriber by a third party without violation of confidentiality obligations.  Furthermore, Subscriber has received and reviewed the Company's Privacy Policy substantially as set forth on Exhibit D, attached hereto.

9.Beneficial Ownership.  The Subscriber represents and warrants that it is subscribing for Interests for Subscriber's own account and own risk, unless the Subscriber advises the Company to the contrary in writing and identifies with specificity each supplemental Beneficial Owner (as defined below) as well as such other information and/or documentation as may be requested or required by the Company.  The Subscriber also represents that it does not have the intention or obligation to sell, distribute or transfer its Interests or any portion thereof, directly or indirectly, to any other person or entity or to any nominee account. If the Subscriber is subscribing on behalf of a Beneficial Owner, then the Subscriber represents that all subscription payments transferred to the Subscriber with respect to such Beneficial Owner originated directly from a bank or brokerage Account in the name of such Beneficial Owner.

The Subscriber represents and warrants that the Subscriber is not (a) acting as trustee, custodian, agent, representative or nominee for (or with respect to) another person or entity (howsoever characterized and regardless of whether such person or entity is deemed to have a property interest, or the like, with respect to such Interests under local law) or (b) an entity (other than a publicly-traded company listed on an organized exchange (or a subsidiary or a pension fund of such a company) based in a FATF-Compliant Jurisdiction (as defined below) investing on behalf of underlying investors (including a Company-of-Companies) (the persons, entities and underlying investors referred to in (a) and (b) being referred to collectively as the "Beneficial Owners").  If the preceding sentence is not true, the Subscriber represents and warrants that:

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(i) The Subscriber understands and acknowledges that the representations, warranties and agreements made herein are made by the Subscriber (A) with respect to the Subscriber and (B) with respect to each of the Beneficial Owners;

(ii) The Subscriber has all requisite power and authority from each of the Beneficial Owners to execute and perform the obligations under these Subscription Documents and to bind each such Beneficial Owner as a party hereto;

(iii) The Subscriber has adopted and implemented anti-money laundering policies, procedures and controls that comply, and will continue to comply, in all respects, with the requirements of applicable anti-money laundering laws and regulations; and

(iv) The Subscriber has verified, or has access to, the identity of each Beneficial Owner, holds evidence of such identity and will make such evidence, together with any other documentation or information reasonably necessary to support the accuracy of Subscriber's representations and warranties contained herein, available to the Company upon request, and has procedures in place to ensure that the Beneficial Owners are not Prohibited Investors.

10.Survival.  The representations, warranties and agreements contained in this Agreement shall survive the execution of this Agreement by the Subscriber and acceptance of this Agreement by the Company.

11.Additional Information.  The Subscriber agrees that, upon demand, it will promptly furnish any information, and execute and deliver such documents, as reasonably required by the Company and furnish any information relating to the Subscriber's relationship with the Company as required by governmental agencies having jurisdiction over the Company.

12.Assignment and Successors.  This Agreement may be assigned by the Subscriber only with the prior written consent of the Company.  Subject to the foregoing, this Agreement shall be binding on the respective successors, assigns, heirs and legal representatives of the parties hereto.

13.No Third Party Beneficiaries.  This Agreement shall not confer any rights or remedies upon any person, other than the parties hereto.

14.Amendment; Waiver.  Neither this Agreement nor any term hereof may be amended other than by written consent of the Subscriber and the Company.  No provision hereof may be waived other than in a writing signed by the waiving party.  Unless expressly provided otherwise, no waiver shall constitute an ongoing or future waiver of any provision hereof.

15.Governing Law.  This Agreement is governed by and shall be construed in accordance with the laws of the State of Delaware, without regard to conflict of laws principles.  For the purpose of any judicial proceeding to enforce an award or incidental to arbitration or to compel arbitration, the Subscriber and the Company hereby submit to the non-exclusive jurisdiction of the Designated Courts, and agree that service of process in such arbitration or court proceedings shall be satisfactorily made upon it if sent by registered mail addressed to it at the address set forth on the Subscriber Information page and Definitions page respectively.

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16.Entire Agreement. This Agreement, the Company Agreement and any side letter entered into between the Company and the Subscriber, and all of the exhibits and appendices attached hereto and thereto, constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and thereof and supersedes any prior written or oral agreements or understandings of the parties with respect thereto.

17.Notice.  All communications hereunder shall be in writing and delivered in person, by registered or certified mail, by electronic mail or otherwise delivered to the Subscriber at the applicable address or number provided to the Company and to the Company at the address or number set forth in the Definitions hereto, or at such other place as the receiving party may designate to the other party by written notice.  Each such communication shall be deemed received on the earlier of (i) receipt, (ii) personal delivery, (iii) transmission by electronic mail (with evidence of transmission from the transmitting device), (iv) one business day after deposit with a nationally recognized overnight courier service or (v) three business days after being sent by registered or certified mail, return receipt requested, postage prepaid.

18.Severability.  If any provision of this Agreement is held by applicable authority to be unlawful, void or unenforceable to any extent, such provision, to the extent necessary, shall be severed from this Agreement and the remainder of this Agreement shall not be affected thereby and shall continue in full force and effect.

19.Electronic Delivery of Disclosures and Schedule K-1.  The Subscriber understands that the Company and the Managing Member expect to deliver tax return information, including Schedule K-1s (each, a "K-1") to the Subscriber by either electronic mail, a posting to a Subscriber-accessible platform, or some other form of electronic delivery.  Pursuant to IRS Rev. Proc. 2012-17 (Feb. 13, 2012), the Subscriber hereby expressly understands, consents to, and acknowledges such electronic delivery of tax returns and related information.

(i) The Subscriber's consent to electronic delivery will apply to all future K–1s unless such consent is withdrawn by the Subscriber.

(ii) If for any reason the Subscriber would like a paper copy of the K-1 after the Subscriber has consented to electronic delivery, the Subscriber may submit a request via email to admin@reincomefunds.com or send a written request to SREIF Manager II, LLC, 2105 South Bascom Avenue, Suite 190, Campbell CA 95008 Attention: Matthew Sullivan.  Requesting a paper copy of the Subscriber's K-1 will not be treated as a withdrawal of consent

(iii) If the Subscriber in the future determines that it no longer consents to electronic delivery, the Subscriber will need to notify the Company so that it can arrange for a paper K-1 to be delivered to the address that the Company then currently has on file.  The Subscriber may submit notice via email toadmin@reincomefunds.comor send a written request SREIF Manager II, LLC, 2105 South Bascom Avenue, Suite 190, Campbell CA 95008 Attention: Matthew Sullivan.  The Subscriber's consent is considered withdrawn on the date the Company receives the written request to withdraw consent. The Company will confirm the withdrawal and its effective date in writing.  A withdrawal of consent does not apply to a K-1 that was emailed to the Subscriber before the effective date of the withdrawal of consent.

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(iv) The Company (or the Managing Member) will cease providing statements to the Subscriber electronically if the Subscriber provides notice to withdraw consent, if the Subscriber ceases to be a member of the Company, or if regulations change to prohibit the form of delivery.

(v) If the Subscriber needs to update the Subscriber's contact information that is on file, please email the update to the Managing Member.  The Subscriber will be notified if there are any changes to the contact information of the Company.

(vi) The Subscriber's K-1 may be required to be printed and attached to a federal, state, or local income tax return.

BY ELECTRONICALLY SIGNING THIS AGREEMENT, THE SUBSCRIBER:

(i) AGREES TO THE TERMS OF THE SUBSCRIPTION AGREEMENT.

(ii) ACKNOWLEDGES THAT ANY MISSTATEMENT MAY RESULT IN AN IMMEDIATE REDEMPTION OF SUBSCRIBER'S INTERESTS.

(iii) AGREES THAT IF THE COMPANY BELIEVES THAT SUBSCRIBER OR A BENEFICIAL OWNER OF SUBSCRIBER IS A PROHIBITED INVESTOR, THE COMPANY MAY BE OBLIGATED TO FREEZE SUBSCRIBER'S INVESTMENT, DECLINE TO MAKE DISTRIBUTIONS OR SEGREGATE THE ASSETS CONSTITUTING SUBSCRIBER'S INVESTMENT WITH THE COMPANY IN ACCORDANCE WITH APPLICABLE LAW.

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Exhibit A

DEFINITIONS

"Arbitration Location" shall mean Los Angeles, CA.

"Company" shall mean:   Secured Real Estate Income Fund II, LLC, a Delaware limited liability company.

"Managing Member" shall mean:   SREIF MANAGER II, LLC, a Nevada limited liability company

"Managing Member E-mail" shall mean: admin@reincomefunds.com

"Managing Member Contact Information" shall mean:

SREIF MANAGER II, LLC

Managing Member

2105 South Bascom Avenue, Suite 190,

Campbell CA 95008

Attention: Matthew Sullivan

"Minimum Subscription Amount" shall mean $5,000.00 (subject to the Managing Member's election to accept a lesser amount).

"Member" shall mean a member as defined in the Company operating agreement.

"Subscription Documents" shall mean this Subscription Agreement, its exhibits, and any documents incorporated by reference therein.

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Exhibit B

Subscriber should review and execute this Agreement online at www.folioinvesting.com.

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Exhibit C

INVESTOR STATUS

The Investor hereby represents and warrants, pursuant to Section 2(a) of the attached Subscription Agreement, that he, she or it is correctly and in all respects described by the category or categories set forth below directly under which the Investor or its authorized representative has signed his, her or its name (or initialed or otherwise indicated that each such category describes the Investor).

ACCREDITED INVESTOR REPRESENTATIONS

By electronically signing the Subscription Agreement, Subscriber agrees that it is an "Accredited Investor" (within the meaning of Rule 501 under the Securities Act) because it meets one of the following:⁷

(i) If an individual, Subscriber has a net worth, either individually or upon a joint basis with Subscriber's spouse, of at least $1,000,000, or has had an individual income in excess of $200,000 for each of the two most recent years, or a joint income with Subscriber's spouse in excess of $300,000 in each of those years, and has a reasonable expectation of reaching the same income level in the current year.

(ii) Subscriber is an irrevocable trust with total assets in excess of $5,000,000 whose purchase is directed by a person with such knowledge and experience in financial and business matters that such person is capable of evaluating the merits and risks of the prospective investment.

(iii) Subscriber is a bank, insurance company, investment company registered under the Company Act, a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934 (the "Exchange Act"), a business development company, a Small Business Investment Company licensed by the United States Small Business Administration, a plan with total assets in excess of $5,000,000 established and maintained by a state for the benefit of its employees, or a private business development company as defined in Section 202(a)(22) of the United States Investment Advisers Act of 1940, as amended.

¹ The meaning of "net worth" (for purposes of determining whether Subscriber is an "accredited investor") means the excess of total assets at fair market value over total liabilities.  For purposes of this calculation,

(a) the amount of Subscriber's total assets shall exclude the fair market value of Subscriber's primary residence, and

(b) the amount of Subscriber's total liabilities shall include the amount of such Subscriber's mortgage and other indebtedness that is secured by Subscriber's primary residence which

(i) exceeds the fair market value of Subscriber's primary residence at the time of Subscriber's admission to the Company, or

(ii) has been incurred by Subscriber within the 60 day period prior to Subscriber's admission to the Company and remains outstanding on the date of Subscriber's admission to the Company (unless such indebtedness was incurred as a result of the acquisition of Subscriber's primary residence).

If, at the time of Subscriber's admission to the Company, Subscriber has mortgage and other indebtedness that is described in both of clauses (i) and (ii) above, then both amounts of indebtedness shall be included in the calculation of Subscriber's total liabilities.

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(iv) Subscriber is an employee benefit plan and either all investment decisions are made by a bank, savings and loan association, insurance company, or registered investment advisor, or Subscriber has total assets in excess of $5,000,000 or, if such plan is a self-directed plan, investment decisions are made solely by persons who are accredited investors.

(v) Subscriber is a corporation, partnership, limited liability company or business trust, not formed for the purpose of acquiring the Interests, or an organization described in Section 501(c)(3) of the Code, in each case with total assets in excess of $5,000,000.

(vi) Subscriber is an entity in which all of the equity owners, or a grantor or revocable trust in which all of the grantors and trustees, qualify under clause (i), (ii), (iii), (iv) or (v) above or this clause (vi).

(vii) Subscriber cannot make any of the representations set forth in clauses (i) through (vi) above and is therefore not an Accredited Investor. Subscriber warrants that the investment in the Class A Units does not represent more than 10% of the greater of Subscriber's annual income or net worth (for natural persons), or 10% of the greater of annual revenue or net assets at fiscal year-end (for non-natural persons).

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Exhibit D

ERISA REPRESENTATIONS

1. Subscriber is not actingon behalf of an entity which is deemed to hold the assets of an "Employee Benefit Plan"⁸ (which is subject to the fiduciary rules of ERISA) or a "Plan"⁹ (e.g., an entity of which 25% or more of any class of equity securities is held by Employee Benefit Plans or Plans, or an insurance company separate account holding "plan assets," etc.) (each, a "Benefit Plan Investor").

2. Subscriber is not a life insurance company using the assets of its general account.

⁸  Any plan, fund or program established or maintained by an employer or employee organization for the purpose of providing pension, welfare or similar benefits (i.e., deferred compensation arrangements) to employees, which is subject to the fiduciary rules of the U.S. Employee Retirement Income Security Act of 1974, as amended ("ERISA").

⁹  An individual retirement account ("IRA"), a Keogh plan or any other plan subject to Section 4975 of the Internal Revenue Code, as amended (the "Code").

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Exhibit E

PRIVACY NOTICE

The Company is committed to protecting your privacy and maintaining the confidentiality and security of your personal information, and in connection therewith, this Privacy Policy is observed by Company.  This Privacy Policy explains the manner in which Managing Member collects, utilizes and maintains nonpublic personal information about its investors ("Investors"), as required under Federal Law.  "Managing Member" collectively refers to the Managing Member and each investment account, partnership, limited liability company or fund (individually a "Company," and collectively, the "Companies") for which the Managing Member serves as general partner, managing member, or manager.  This Privacy Policy only applies to products and services provided by Managing Member to individuals (including regarding investments in the Company) and which are used for personal, family, or household purposes (not business purposes).

Collection of Investor Information

Managing Member collects personal information about its Investors from the following sources:

1.Subscription forms, investor questionnaires, account forms, and other information provided by the Investor in writing, in person, by telephone, electronically or by any other means.  This information includes name, address, employment information, and financial and investment qualifications;

2.Transactions within the Company, including account balances, investments, distributions and fees;

3.Other interactions with Managing Member's affiliates (for example, discussions with our staff and affiliated broker-dealer); and

4.Verification services and consumer reporting agencies, including an Investor's creditworthiness or credit history.  (Managing Member generally does not use these services.)

Disclosure of Nonpublic Personal Information

Managing Member may share nonpublic personal information about its Investors or potential Investors with affiliates, as permitted by law.  Managing Member does not disclose nonpublic personal information about its Investors or potential Investors to nonaffiliated third parties, except as permitted by law (for example, to service providers who provide services to the Investor or the Investor's account).

Managing Member may share nonpublic personal information, without an Investor's consent, with affiliated and nonaffiliated parties in the following situations, among others:

1.To respond to a subpoena or court order, judicial process or regulatory inquiry;

2.In connection with a proposed or actual sale, merger, or transfer of all or a portion of its business;

3.To protect or defend against fraud, unauthorized transactions (such as money laundering), law suits, claims or other liabilities;

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4.To service providers of Managing Member in connection with the administration and operations of Managing Member, the Company and other Managing Member products and services, which may include brokers, attorneys, accountants, auditors, administrators or other professionals;

5.To assist Managing Member in offering Managing Member-affiliated products and services to its Investors;

6.To process or complete transactions requested by an Investor; and

7.For any proper purpose as contemplated by or permitted under the applicable Company offering, governing or organizing documents.

Former Customers and Investors

The same Privacy Policy applies to former Investors.

Protection of Investor Information

Managing Member maintains physical, electronic and procedural safeguards that comply with federal standards to protect customer information.  Managing Member restricts access to the personal and account information of Investors to those employees who need to know that information in the course of their job responsibilities.

Further Information

Managing Member reserves the right to change this Privacy Policy at any time.  The examples contained within this Privacy Policy are illustrations and are not intended to be exclusive.  This Privacy Policy complies with Federal Law regarding privacy.  You may have additional rights under other foreign or domestic laws that may apply to you.  All questions should be directed to Managing Member Contact Information.

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EX1A-8 ESCW AGMT

Escrow Services Agreement

This Escrow Services Agreement (this "Agreement") is made and entered into as of %%TODAY%% by and between Provident Trust Group, LLC ("Provident" or "Escrow Agent") and %%ISSUER_NAME%% ("Issuer") for its offering known as "%%OFFERING_NAME%%".

Recitals

WHEREAS, Issuer proposes to offer for sale to investors as disclosed in its offering materials, securities pursuant to either a) Rule 506 promulgated by the U.S. Securities and Exchange Commission ("SEC") under the Securities Act of 1933, as amended (the "Securities Act"); b) Regulation A+ promulgated by the SEC as modified by final rules adopted per Title IV of the Jumpstart Our Business Startups (JOBs) Act; or c) another federal or state exemption from registration, either directly ("issuer-direct") and/or through one or more registered broker-dealers as a selling group ("Syndicate"), the equity and/or debt securities of Issuer (the "Securities") in the amount of at least %%MINIMUM_AMOUNT%% (the "Minimum Amount of the Offering") up to %%MAXIMUM_AMOUNT%% (the "Maximum Amount of the Offering").

WHEREAS, Issuer desires to establish an Escrow Account in which funds received from prospective investors ("Subscribers") will be held during the Offering, subject to the terms and conditions of this Agreement. Provident agrees to serve as Escrow Agent ( "Escrow Agent") for the Subscribers with respect to such Escrow Account in accordance with the terms and conditions set forth herein. This includes, without limitation, that the Escrow Account will be held at an FDIC member bank in a separately named (as defined below) account. For purposes of communications and directives, Escrow Agent shall be the sole administrator of the Escrow Account.

Agreement

NOW THEREFORE, in consideration of the foregoing, it is hereby agreed as follows:

1.         Establishment of Escrow Account. Prior to Issuer initiating the Offering, and prior to the receipt of the first investor funds, Escrow Agent shall establish an account at an FDIC insured US bank (the "Bank") entitled "Provident Trust Group, LLC as Escrow Agent for Investors in %%OFFERING_NAME%%" (the "Escrow Account"). The Escrow Account shall be a segregated, deposit account of Escrow Agent at the Bank. All parties agree to maintain the Escrow Account and escrowed funds in a manner that is compliant with banking and securities regulations.

2.         Escrow Period. The Escrow Period shall begin with the commencement of the Offering and shall terminate in whole or in part upon the earlier to occur of the following:

1. The date upon which the minimum number of securities required to be sold are sold (the "Minimum") in bona fide transactions that are fully paid for, which is defined to occur when Escrow Agent has received gross proceeds of at least Minimum Amount of the Offering that have cleared in the Escrow Account and the issuer has triggered a partial or full closing on those funds. Even after a partial close, of for continuous offerings, Escrow shall remain open in order to perform investor AML, to clear investor funds, and to perform other tasks prior to the issuer selling securities to any investor; or

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2. %%ESCROW_CLOSES_AT%% if the Minimum has not been reached; or

3. The date upon which a determination is made by Issuer and/or their authorized representatives, including any lead broker or placement agent, to terminate the Offering prior to closing.

During the Escrow Period, the parties agree that (i) the Escrow Account and escrowed funds will be held for the benefit of the Subscribers, and that (ii) Issuer is not entitled to any funds received into escrow, and that no amounts deposited into the Escrow Account shall become the property of Issuer or any other entity, or be subject to any debts, liens or encumbrances of any kind of Issuer or any other entity, until the contingency has been satisfied by the sale of the Minimum of such Securities to such investors in bona fide transactions that are fully paid for, in accordance with Regulation D and as specified in the offering documents. Even after a sale of securities to investors, the Issuer may elect to continue to leave funds in the Escrow Account in order to protect investors as needed.

In addition, Issuer and Escrow Agent acknowledge that the total funds raised cannot exceed the Maximum Amount of the Offering permitted by the Offering Memorandum. Issuer represents that no funds have yet been raised for %%OFFERING_NAME%% and that all funds to be raised for %%OFFERING_NAME%% will be deposited in the Escrow Account established by Escrow Agent.

3.        Deposits into the Escrow Account. All Subscribers will be directed by the Issuer to transmit their data and funds, via Escrow Agent's technology systems, directly to the Escrow Agent as the "qualified third party" that has agreed to hold the funds for the benefit of investors and Issuer. All Subscribers will transfer funds directly to Escrow Agent (with checks, if any, made payable to "Provident Trust as Agent for <issuer name>") for deposit into the Escrow Account. Escrow Agent shall process all Escrow Amounts for collection through the banking system and shall maintain an accounting of each deposit posted to its ledger, which also sets forth, among other things, each Subscriber's name and address, the quantity of Securities purchased, and the amount paid. All monies so deposited in the Escrow Account and which have cleared the banking system are hereinafter referred to as the "Escrow Amount." Issuer shall promptly, concurrent with any new or modified subscription, provide Escrow Agent with a copy of the Subscriber's subscription and other information as may be reasonably requested by Escrow Agent in the performance of their duties under this Agreement. Escrow Agent is under no duty or responsibility to enforce collection of any funds delivered to it hereunder. Issuer shall assist Escrow Agent with clearing any and all AML and ACH exceptions.

Funds Hold – clearing, settlement and risk management policy: All parties agree that funds are considered "cleared" as follows:
Wires – 48 hours after receipt of funds
Checks – 10 days after deposit

ACH – As transaction must clear in a manner similar to checks, and as Federal regulations provide investors with 60 days to recall funds, for risk reduction and protection the Escrow Agent will agree to release, starting 10 calendar days after receipt and so long as the offering is closed, the greater of 94% of funds or gross funds less ACH deposits still at risk of recall. Of course, regardless of this operating policy, Issuer remains liable to immediately and without protestation or delay return to us any funds recalled pursuant to Federal regulations.

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Escrow Agent reserves the right to deny, suspend or terminate participation in the Escrow Account of any Subscriber to the extent Escrow Agent deems it advisable or necessary to comply with applicable laws or to eliminate practices that are not consistent with laws, rules, regulations or best practices. Escrow Agent may at any time reject or return funds to any Subscriber (i) that do not clear background checks (anti-money laundering, USA PATRIOT Act, social security number issues, etc.) to the satisfaction of Escrow Agent, in its sole and absolute discretion, or, (ii) for which Escrow Agent determines, in its sole discretion, that it would be improper or unlawful for Escrow Agent to accept or hold the applicable Subscriber's funds, as Escrow Agent, due to, among other possible issues, issues with the Subscriber or the source of the Subscriber's funds. Escrow Agent shall inform Issuer of any such return or rejection via notifications on the Issuer online control panel or via Webhooks in the API.

4. Disbursements from the Escrow Account. In the event Escrow Agent does not receive the Minimum prior to the termination of the Escrow Period, Escrow Agent shall terminate Escrow and make a full and prompt return of funds so that refunds are made to each Subscriber in the exact amount received from said Subscriber, without deduction, penalty, or expense to the Subscriber.
In the event Escrow Agent receives cleared funds for at least the Minimum prior to the termination of the Escrow Period and Escrow Agent receives a written instruction from Issuer (generally via notification in the API), Escrow Agent shall, pursuant to those instructions, pay such Escrow Amount for all accepted subscriptions pursuant to the instructions of Issuer, but subject to Escrow Agent's rights concerning Return Period funds (defined as the time period the Subscriber has to seek a return of funds, or to seek to avoid liability for the funds by claiming the transaction was unauthorized) (First Closing). After the First Closing, with respect to any additional collected funds received from Subscribers and held by Escrow Agent prior to the termination date, Escrow Agent shall, upon receipt of written instructions from Issuer, including identifying additional participating Subscribers and the corresponding Escrow Amount, pay such Escrow Amount specified in the written instructions, but subject to Escrow Agent's rights concerning Return Period funds (discussed above). Issuer acknowledges that there is a 24 hour (one business day) processing time once a request has been received to break Escrow or otherwise move funds. This is to accommodate the time needed to compare the request to the offering documents, to ensure AML has been completed, and to prepare funds for disbursement.
Issuer hereby irrevocably authorizes Escrow Agent to deduct broker fees and other funds for management and offering and selling expenses from the gross proceeds of the Escrow Account prior to remitting such funds, if and when due, to Issuer. Escrow Agent is hereby directed to remit such funds directly to the broker(s) and other parties, if any, to which they are due. Net proceeds (meaning gross proceeds less amounts remitted to brokers and other parties, and interest earned or accumulated in the Escrow Account) will then be remitted to Issuer as described above. Furthermore, Issuer directs Escrow Agent to accept instructions regarding fees from any registered securities broker in the syndicate, if any.

5. Collection Procedure. Escrow Agent is hereby authorized, upon receipt of Subscriber funds, to promptly deposit them in the Escrow Account. Any Subscriber funds which fail to clear or are subsequently reversed, including but not limited to ACH chargebacks and wire recalls, shall be debited to the Escrow Account, with such debits reflected on the Escrow ledger accessible via Escrow Agents API or dashboard technology. Any and all fees paid by Issuer for funds receipt and processing are non-refundable, regardless of whether ultimately cleared, failed,

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rescinded, returned or recalled. In the event of any Subscriber refunds, returns or recalls after funds have already been remitted to Issuer, then Issuer hereby irrevocably agrees to immediately and without delay or dispute send equivalent funds to Escrow Agent to cover the refund, return or recall. If Issuer has any dispute or disagreement with its Subscriber then that is separate and apart from this Agreement and Issuer will address such situation directly with said Subscriber, including taking whatever actions Issuer determines appropriate, but Issuer shall regardless remit funds to Escrow Agent and not involve Escrow Agent in any such disputes.

6. Investment of Escrow Amount. Escrow Agent may, at its' discretion, invest any or all of the Escrow Account balance as permitted by banking regulations. No interest shall be paid to Issuer or Subscribers on the Escrow Account balance.

7. Escrow Administration Fees, Compensation of Escrow Agent. Escrow Agent is entitled to escrow administration fees from Issuer as set forth in Exhibit A.

Issuer agrees without exception that it is liable to Escrow Agent to pay and agrees to pay Escrow Agent, even under circumstances where Issuer has entered an agreement that said fees are to be paid by another party. All fees are charged immediately upon receipt of this Agreement, and are not contingent in any way on the success or failure of the Offering. Furthermore, Escrow Agent is exclusively entitled to retain as part of its compensation any and all investment interest, gains and other income earned pursuant to item 6 above. No fees, charges or expense reimbursements of Escrow Agent are reimbursable, and are not subject to pro-rata analysis. All fees and charges, if not paid by a representative of Issuer (e.g. funding platform, lead syndicate broker, etc.), may be made via either Issuers credit card or ACH information on file with Escrow Agent. Escrow Agent may also collect its fee(s), at its option, from any escrowed funds due to Issuer. It is acknowledged and agreed that no fees, reimbursement for costs and expenses, indemnification for any damages incurred by Issuer or Escrow Agent shall be paid out of or chargeable to the investor funds on deposit in the Escrow Account.

8.            Representations and Warranties. The Issuer covenants and makes the following representations and warranties toEscrow Agent:

    a. It is duly organized, validly existing, and in good standing under the laws of the state of its incorporation or organization, and has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder.

    b. This Agreement has been duly approved by all necessary actions, including any necessary shareholder or membership approval, has been executed by its duly authorized officers, and constitutes its valid and binding agreement enforceable in accordance with its terms.

    c. The execution, delivery, and performance of this Agreement is in accordance with the agreements related to the Offering and will not violate, conflict with, or cause a default under its articles of incorporation, bylaws, management agreement or other organizational document, as applicable, any applicable law, rule or regulation, any court order or administrative ruling or decree to which it is a party or any of its property is subject, or any agreement, contract, indenture, or other binding arrangement, including the agreements related to the Offering, to which it is a party or any of its property is subject.

    d.  The Offering shall contain a statement that Escrow Agent has not investigated the desirability or advisability of investment in the Securities nor approved, endorsed or passed upon the merits of purchasing the Securities; and the name of Escrow Agent has not and shall not be used in any manner in

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connection with the Offering of the Securities other than to state that Escrow Agent has agreed to serve as escrow agent for the limited purposes set forth in this Agreement.

    e.  No party other than the parties hereto has, or shall have, any lien, claim or security interest in the Escrow Funds or any part thereof. No financing statement under the Uniform Commercial Code is on file in any jurisdiction claiming a security interest in or describing (whether specifically or generally) the Escrow Funds or any part thereof.

    f. It possesses such valid and current licenses, certificates, authorizations or permits issued by the appropriate state, federal or foreign regulatory agencies or bodies necessary to conduct its respective businesses, and it has not received any notice of proceedings relating to the revocation or modification of, or non-compliance with, any such license, certificate, authorization or permit.

   g.   The Offering complies in all material respects with the Act and all applicable laws, rules and regulations.

All of its representations and warranties contained herein are true and complete as of the date hereof and will be true and complete at the time of any disbursement of Escrow Funds.

9.        Term and Termination. This Agreement will remain in full force during the Escrow Period and shall terminate upon the following:

    a.  As set forth in Section 2.

    b.  Termination for Convenience. Any party may terminate this Agreement at any time for any reason by giving at least thirty (30) days' written notice.

    c.  Escrow Agent's Resignation. Escrow Agent may unilaterally resign by giving written notice to Issuer, whereupon Issuer will immediately appoint a successor escrow agent. Until a successor escrow agent accepts appointment or until another disposition of the subject matter has been agreed upon by the parties, following such resignation notice, Escrow Agent shall be discharged of all of its duties hereunder save to keep the subject matter whole. Even after this Agreement is terminated, certain provisions will remain in effect, including but not limited to items 3, 4, 5, 10, 11, 12, 14, and 15 of this Agreement. Escrow Agent shall be compensated for the services rendered as of the date of the termination or removal.

10. ApplicableLaw,Venue,andAttorney'sFees: ThisAgreementisgovernedby,andwillbeinterpretedandenforced in accordance with the laws of the State of Nevada, as applicable, without regard to principles of conflict of laws, and each party submits to the personal jurisdiction, and waives all objections to venue for the enforcement of any provision of this Agreement, in the state and federal courts situated in Clark County, Nevada. Furthermore, the prevailing party shall be entitled to recover damages plus reasonable attorney's fees and costs.

11. LimitedCapacityofEscrowAgent. ThisAgreementexpresslyandexclusivelysetsforththedutiesofEscrowAgent with respect to any and all matters pertinent hereto, and no implied duties or obligations shall be read into this Agreement against Escrow Agent. Escrow Agent acts hereunder as an escrow agent only and is not associated, affiliated, or involved in the business decisions of Issuer or Subscriber. Escrow Agent is not responsible or liable in any manner whatsoever for the sufficiency, correctness, genuineness, or validity of the subject matter of this

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Agreement or any part thereof, or for the form of execution thereof, or for the identity or authority of any person executing or depositing such subject matter. Escrow Agent shall be under no duty to investigate or inquire as to the validity or accuracy of any document, agreement, instruction, or request furnished to it hereunder, including, without limitation, the authority or the identity of any signer thereof, believed by it to be genuine, and Escrow Agent may rely and act upon, and shall not be liable for acting or not acting upon, any such document, agreement, instruction, or request. Escrow Agent shall in no way be responsible for notifying, nor shall it be responsible to notify, any party thereto or any other party interested in this Agreement of any payment required or maturity occurring under this Agreement or under the terms of any instrument deposited herewith.

12. Indemnity. Issuer agrees to defend, indemnify and hold Escrow Agent and its respective related entities, directors, employees, service providers, advertisers, affiliates, officers, agents, and partners and third-party service providers harmless from any loss, liability, claim, or demand, including reasonable attorney's fees, made by any third party due to or arising out of this Agreement and/or arising from a breach of any provision in this Agreement. This indemnity shall also include, but is not limited to, all expenses incurred in conjunction with any interpleader that Escrow Agent may enter into regarding this Agreement and/or third-party subpoena or discovery process that may be directed to Escrow Agent. This defense and indemnification obligation will survive termination of this Agreement.
Escrow Agent reserves the right to control the defense of any such claim or action and all negotiations for settlement or compromise, and to select or approve defense counsel, and Issuer agrees to fully cooperate with Escrow Agent in the defense of any such claim, action, settlement, or compromise negotiations.

13. EntireAgreement,Severability and Force Majeure. ThisAgreementcontainstheentireagreementbetweenIssuer and Escrow Agent regarding the Escrow Account. If any provision of this Agreement is held invalid, the remainder of this Agreement shall continue in full force and effect. Furthermore, no party shall be responsible for any failure to perform due to acts beyond its reasonable control, including acts of God, terrorism, shortage of supply, labor difficulties (including strikes), war, civil unrest, fire, floods, electrical outages, equipment or transmission failures, internet interruptions, vendor failures (including information technology providers), or other similar causes.

14. Changes. Escrow Agent may, at its sole discretion, comply with any new, changed, or reinterpreted regulatory or legal rules, laws or regulations, and any interpretations thereof, and without necessity of notice, to modify either this Agreement and/or the Escrow Account to comply or conform to such changes or interpretations. Escrow Agent will notify Issuer of material changes as soon as practicable. Furthermore, all parties agree that this Agreement shall continue in full force and be valid, unchanged and binding upon any successors of Escrow Agent. Changes to this Agreement will be sent to Issuer via email.

15. Waivers. No waiver by any party to this Agreement of any condition or breach of any provision of this Agreement will be effective unless in writing. No waiver by any party of any such condition or breach, in any one instance, will be deemed to be a further or continuing waiver of any such condition or breach or a waiver of any other condition or breach of any other provision contained in this Agreement.

16. Notices. Any notice to Escrow Agent is to be sent to Escrow@trustprovident.com. Any notices to Issuer will be to %%ISSUER_EMAIL%%.

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17. Language. It is expressly agreed that it is the will of all parties, including Escrow Agent and Issuer that this Agreement and all related pages, forms, emails, alerts and other communications have been drawn up and/or presented in English.

18. Electronic Signature and Communications Notice and Consent. Digital ("electronic") signatures, often referred to as an "e-signature", enable paperless contracts and help speed up business transactions. The 2001 E-Sign Act was meant to ease the adoption of electronic signatures. The mechanics of this Agreement's electronic signature include the parties signing this Agreement below by typing in the party's name, with the underlying software recording its IP address, browser identification, the timestamp, and a securities hash within an SSL encrypted environment. This electronically signed Agreement will be available to both Issuer and Escrow Agent, as well as any associated bankers, brokers and platforms so they can access and copy it at any time. Issuer and Escrow Agent hereby consent and agree that electronically signing this Agreement constitutes each party's signature, acceptance and agreement as if actually signed by each party in writing. Further, all parties agree that no certification authority or other third party verification is necessary to validate any electronic signature; and that the lack of such certification or third party verification will not in any way affect the enforceability of your signature or resulting contract between Issuer and Escrow Agent. The parties understand and agree that the e- signature executed in conjunction with the electronic submission of this Agreement shall be legally binding and such transaction shall be considered authorized by each party. The parties agree that their electronic signatures are the legal equivalent of their manual signatures on this Agreement consenting to be legally bound by this Agreement's terms and conditions. Furthermore, Issuer and Escrow Agent hereby agree that all current and future notices, confirmations and other communications regarding this Escrow Services Agreement specifically, and future communications in general between the parties, may be made by email, sent to the email address of record as set forth in Section 16 above, or as otherwise from time to time is changed or updated and disclosed to the other party, without necessity of confirmation of receipt, delivery or reading, and such form of electronic communication is sufficient for all matters regarding the relationship between the parties. If any such electronically sent communication fails to be received for any reason, including but not limited to such communications being diverted to the recipients spam filters by the recipients email service provider, or due to a recipients change of address, or due to technology issues by the recipient's service provider, the parties agree that the burden of such failure to receive is on the recipient and not the sender, and that the sender is under no obligation to resend communications via any other means, including but not limited to postal service or overnight courier, and that such communications shall for all purposes, including legal and regulatory, be deemed to have been delivered and received. No physical, paper documents will be sent to Issuer, and if Issuer desires physical documents, then Issuer agrees to be satisfied by directly and personally printing, at its own expense, the electronically sent communication(s) and maintaining such physical records in any manner or form that Issuer desires.

19. SubstituteFormW–9:Taxpaye Identification Number certification and backup withholding statement.

PRIVACY ACT STATEMENT: Section 6109 of the Internal Revenue Code requires you (Issuer) to provide us with your correct Taxpayer Identification Number (TIN).

Name of Business: %%ISSUER_NAME%%

Tax Identification Number: %%ISSUER_TAX_ID_NUMBER%%

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Under penalty of perjury, by signing this Agreement below I certify that: 1) the number shown above is our correct business taxpayer identification number; 2) our business is not subject to backup withholding unless we have informed Provident Trust in writing to the contrary; and 3) our Company is a U.S. domiciled business.

Consent is Hereby Given: By signing this Agreement electronically, Issuer explicitly agrees to receive documents electronically including its copy of this signed Agreement as well as ongoing disclosures, communications, and notices.

Agreed as of the date set forth above by and between:

%%ISSUER_SIGNATURE%%

 %%ESCROW                                                                                                                                                                                          AGENT_SIGNATURE%%

EXHIBIT

A Fees and Costs

Escrow Agent's Administrative Fees shall be calculated on the following schedule.

[<INSERT FEES FOR THIS OFFERING>]

Misc. Administrative Services (not under contract, but which Escrow Agent agrees to perform), $100 per hour

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EX1A-8 ESCW AGMT

ESCROW SERVICES AND CUSTODY AGREEMENT

This Escrow Services and Custody Agreement (this "Agreement") is effective this _____ day of ___________, 20___ (the "Effective Date") by and among ___________________________(Company Name), a __________________ [Type of Corporate Entity and State of Establishment] ("Issuer"), and Folio Investments, Inc. ("Folio"), a Virginia corporation.  Issuer and Folio are hereby referred to collectively as the "Parties" or individually as a "Party".

RECITALS

A.WHEREAS, Folio is a registered clearing broker-dealer that, among other things, custodies non-public/unlisted security interests, facilitates the private offering of securities and holds customer funds;

B.WHEREAS, Issuer has issued, or intends to issue, certain securities, which may not be exchange listed or public reporting companies as described on Schedule A ("Private Security(ies)");

C.WHEREAS, Issuer wishes to engage Folio, and Folio wishes to accept such engagement, to provide its escrow-less closing and custody services for some or all of the Private Securities held by purchasers thereof and to perform related services with respect thereto.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and conditions set forth herein, and intending to be legally bound, the Parties hereto agree as follows:

1 DEFINITIONS

1.1 "Action" shall have the meaning set forth in Section 7.2 of this Agreement.

1.2 "ACH" means Automated Clearing House.

1.3 "Affiliate" means any person that is directly or indirectly, through one or more intermediaries, Controlling, Controlled by, or under common Control with, one of the parties hereto.  For purposes of this definition, "Control" shall mean possessing, directly or indirectly, the power to direct or cause the direction of the management, policies and operations of a person, whether through ownership of voting securities, by contract or otherwise.

1.4 "Books and Records" shall have the meaning set forth in Schedule B-1 attached to this Agreement.

1.5 "Branding" means trademarks, service marks, domain names, logos, links, navigation and other indicators of origin.

1.6 "Content" means any or all text, images, video, audio, graphics, and other data, products, materials, services, text, pointers, technology, code, language, functions and software, including Branding.

1.7 "Exchange Act" means the Securities Exchange Act of 1934, as amended.

1.8 "Fees" shall have the meaning set forth in Section 3.1 of this Agreement.

1.9 "FINRA" means the Financial Industry Regulatory Authority, Inc. or any successor thereto.

1.10 "Folio Branding" means all Branding (other than from Issuer) used by Folio and includes any Branding provided by Folio to Issuer for use on the Issuer Site.

1.11 "Folio Content" means the Content owned by, licensed for use by, or otherwise permitted to be used by Folio in any manner, which for the avoidance of doubt shall in no event include Issuer Content.

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1.12 "Folio Customer" means a person that has executed a customer account agreement with Folio and maintains a brokerage account with Folio, whether or not they have purchased the Private Securities.

1.13 "Folio Indemnified Parties" shall have the meaning set forth in Section 7.2 of this Agreement.

1.14 "Folio Name" means, and includes, the name of Folio or any of its Affiliates, or the name of any member, stockholder, partner, manager or employee of Folio or any of its Affiliates, or any trade name, trademark, logo, service mark, symbol or any abbreviation, contraction or simulation thereof owned or used by Folio or any of its Affiliates.

1.15 "Folio Site" means those internet sites, including but not limited to www.folioinvesting.com, www.folioclient.com and www.folioinstitutional.com, maintained by Folio for the purpose of offering its services.

1.16 "Investor(s)" means a Folio Customer who holds the Private Securities in a brokerage account with Folio, excluding the Issuer.

1.17 "Issuer Branding" means all Branding (other than from Folio) used by Issuer and includes any Branding provided by Issuer to Folio for use on the Folio Site.

1.18 "Issuer Content" means the Content owned by, licensed for use by, or otherwise permitted to be used by Issuer in any manner, which for the avoidance of doubt shall in no event include Folio Content.

1.19 "Issuer Indemnified Parties" shall have the meaning set forth in Section 7.3 of this Agreement.

1.20 "Issuer Site" means those internet sites as set forth on Schedule A maintained by the Issuer or an Affiliate of the Issuer for the purpose of offering the Private Securities.

1.21 "Law" or "Legal Requirement" means any statute, law, ordinance, rule or regulation, or any order, judgment, or plan, of any court, arbitrator, department, agency, authority, instrumentality or other body, whether federal, state, municipal, foreign, self-regulatory or other that governs the activities of  either of the Parties.

1.22 "Losses" shall have the meaning set forth in Section 7.2 of this Agreement.

1.23 "Offering" means the offering, pursuant to a registration statement under the Securities Act or an exemption therefrom, of Private Securities to Investors.

1.24 "Private Placements Platform" means such technology owned, operated or made available by Folio or an Affiliate of Folio for Issuer's use in making the Private Securities available in a direct Offering.

1.25 "Private Security(ies)" shall have the meaning set forth in the recitals.

1.26 "SEC" means the U.S. Securities and Exchange Commission.

1.27 "Securities Act" means the Securities Act of 1933, as amended.

1.28 "Services" shall have the meaning set forth in Section 2.1 and 2.2 of this Agreement.

1.29 "Term" shall have the meaning set forth in Section 8.1 of this Agreement.

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2 ESCROW AND RELATED CUSTODIAL SERVICES

2.1 Escrow and Related Closing Services. Folio shall provide its escrow-less private offering closing services, and perform related services, as described by the provisions of Schedule B-1 of this Agreement for the Private Securities.

2.2 Custodial and Related Services.  Folio shall hold, as nominee custodian, the Private Securities and perform related services with respect to the Issuer to the extent explicitly required by specific provisions contained in Schedule B-1 of this Agreement and shall not be responsible for any duties or obligations not specifically allocated to Folio pursuant to this Agreement, which services shall be contingent upon Issuer meeting its obligations as outlined herein and in Schedule B-2, and as limited by Schedule C of this Agreement (the "Services").  Folio may also, in its sole discretion, take such actions as it reasonably deems necessary to perform due diligence or investigation with respect to the Issuer and/or any Offering at any time and from time to time.

2.3 Exclusivity.  Because confusion and inconsistencies may arise from the use of multiple recordkeeping and custody systems to hold the Private Securities in the U.S., unless otherwise agreed to between the Parties, Issuer shall not, during the Term, establish, maintain or permit any other person to establish or maintain on its behalf a similar relationship with a custodian, clearing broker or transfer agent to perform the Services with respect to the Private Securities.

2.4 Modifications to Folio Systems, Platforms and Operations.  Folio upgrades and enhances its platform and amends, modifies and changes its operations and procedures on a consistent basis.  Folio reserves the right, therefore, in its sole discretion, to change or modify the Private Placements Platform at any time and from time to time.

2.5 No Discretionary Authority.  Unless and only to the extent specifically described in any separate agreement between Folio and the Issuer: (a) Folio shall, at all times, act solely in a passive, non-discretionary capacity with respect to the Issuer and each Investor and each brokerage account with Folio maintained by Issuer or each Investor and shall not be responsible or liable for any investment decisions or recommendations with respect to the purchase or disposition of any Private Security or other assets; (b) Folio shall not be responsible for questioning, investigating, analyzing, monitoring, or otherwise evaluating any of the investment decisions of any Investor or reviewing the prudence, merits, viability or suitability of any investment decision made by any Investor, including the decision to purchase or hold the Private Securities or such other investment decisions or direction that may be provided by any individual or entity with authority over the relevant Investor; and (c) Folio shall not be responsible for directing investments or determining whether any investment by a Investor or any person or entity with authority to make investment decisions on Investor's behalf is acceptable under applicable Law.

2.6 Book Entry Securities.  The Private Securities will be book entry securities on Folio's Books and Records and held for the benefit of the Investors.   Folio will maintain, as part of the Services, information as to amounts owed and paid with respect to the Private Securities to the individual Investors.  Accordingly, Folio agrees to accurately maintain its Books and Records and to provide Issuer information from its Books and Records as reasonably requested by Issuer.  Issuer shall maintain on its books and records the amount owed and paid to Investors with respect to the Private Securities, which may be in aggregate if permitted by Law and include an omnibus position in the Private Securities at Folio, held and maintained for the benefit of the Investors.  Issuer will notify Folio immediately if the amount owed or paid with respect to the Private Securities to Investors or the position held on Issuer's books and records is different from the amount that Folio reports to Issuer.

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3 FEES

3.1 Fees.  The fees payable by the Issuer to Folio are specified in Schedule D to this Agreement (collectively, "Fees").  Folio is authorized to debit the Fees or any other obligation of Issuer to Folio automatically from the Issuer's account with Folio as such becomes due.  Issuer will maintain sufficient cash in, and from time to time deposit sufficient funds in, such account to ensure payment of its obligations, including the Fees, to Folio.

3.2 Required Fee Changes.  Folio reserves the right to increase, amend or change the Fees as a result of: (a) changes in Law; (b) increased costs or fees charged by vendors or third party service providers, including service providers that are Affiliates of Folio, that in Folio's sole reasonable judgment requires Folio to incur new or increased costs to provide the Services; or (c) changes in the Services that result in the performance of additional, duplicative or amended activities by Folio under this Agreement, which, in Folio's sole reasonable judgment cause Folio to incur new or increased costs.

3.3 Discretionary Fee Changes. Folio needs to, and does, reserve the right to increase, amend or change the Fees as a result of changes in the business environment, internal procedural changes, its determination to increase the profitability of providing the Services, or other matters foreseen or unforeseen.

3.4 Fee Change Procedure.  Prior to debiting the Issuer's account for Fees that have changed pursuant to this Section 3, Folio promptly will provide Issuer with an amended Schedule D or such other documentation necessary to describe the Fee changes, along with an explanation of any changes.  Any amendments or updates to the Fees in Schedule D or otherwise shall become effective upon the expiration of the earlier of thirty (30) days after the date of such notice or, should the Fee change be due to costs or fees from a third party, whether or not the third party is an Affiliate of Folio, then the date on which such third party costs or fees become effective.

4 NAMES, BRANDS, WEBSITES AND CONTENT

4.1 Use of Folio Name, Folio Brand and Folio Content.  Issuer shall not, and shall cause its representatives not to, without the prior written consent of Folio: (a) use in advertising, publicity, or otherwise any Folio Name, Brand or Content, or (b) represent, directly or indirectly, that Issuer, any Affiliate of Issuer, or any representative of Issuer or the Private Securities have been approved, endorsed, or recommended by Folio or any of its Affiliates.  In addition, all use of the Folio Name, Branding or Content and all descriptive materials about the Services used by the Issuer on the Issuer Site or elsewhere, must be reviewed and approved by Folio, as to appearance, substance and placement, prior to use by Issuer.  Folio may also require a "jump" or other interstitial page in connection with any links or references to Folio or any of its websites or otherwise if deemed necessary by Folio to ensure clear demarcation between any websites or content of Folio and any websites or content of Issuer.  Issuer understands that any breach hereof may also cause a breach of Law, and Issuer will be liable hereunder for any failure to obtain such prior approval or otherwise comply with these provisions.

4.2 Use of Issuer Name, Issuer Brand and Issuer Content.  Folio shall not, and shall cause its representatives not to, without the prior written consent of Issuer use in advertising, publicity, or otherwise any Issuer Name, Brand or Content.  In addition, all use of the Issuer Name, Branding or Content on the Folio Site must be reviewed and approved by Issuer, as to appearance, substance and placement, prior to use by Folio.  Issuer may also require a "jump" or other interstitial page in connection with any links or references to Issuer or any of its websites or otherwise to ensure clear demarcation between any websites or content of Issuer and any websites or content of Folio.  Folio understands that any breach hereof may also cause a breach of Law, and Folio will be liable hereunder for any failure to obtain such prior approval or otherwise comply with these provisions.

4.3 No Responsibility for Issuer Site or Issuer Content.  Folio is not preparing, endorsing, adopting, reviewing or approving in any way the Issuer Site or Issuer Content or any offering material, including any offering memorandum, or any other materials of any kind prepared by Issuer or on behalf of Issuer (even if prepared by Folio on behalf of Issuer) wherever it may appear, except to the extent that the Issuer Site, Issuer Content or other material specifically references Folio, and then only to the limited extent of such reference.

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4.4 No License of Intellectual Property.  No license or grant of any intellectual property of any nature whatsoever, including any Branding or Content, or any data, business method, patents or applications thereof or similar material shall be deemed granted, licensed or otherwise from either Party (or any Affiliate thereof) to the other (or any Affiliate thereof) under this Agreement.

5 CONFIDENTIAL INFORMATION

5.1 Either Party or any Affiliate thereof may disclose to the other or an Affiliate thereof (the recipient being the "Receiving Party") certain technical or other business information that is not generally available to the public, the specific terms of this Agreement, and/or personal information relating to any person (specifically including in the case of Folio, information relating to a Folio Customer).  All such information is referred to herein as "Confidential Information".  Notwithstanding the foregoing, the Books and Records as they pertain to the Private Securities (and with the permission of the Investors with respect to any personally identifying information), will be made available to Issuer, and shall be Confidential Information as to Folio, and may only be used by Issuer in accordance with Law or as otherwise authorized by the Folio Customer to whom the information pertains by affirmative or negative consent, as permitted.

5.2 The Receiving Party agrees to use Confidential Information solely in conjunction with its performance under this Agreement, in conducting an Offering, and or as otherwise authorized by the Folio Customer to whom the information pertains by affirmative or negative consent, as permitted, and not to disclose or otherwise use such information in any other fashion and to maintain such information with at least the standard of care it uses to protect its own Confidential Information, but in no event less than a reasonable standard of care.

5.3 The Receiving Party will not be required to keep confidential such Confidential Information to the extent that it: (a) becomes generally available without fault on its part; (b) is already rightfully in the Receiving Party's possession prior to its receipt from the disclosing Party; (c) is independently developed by the Receiving Party; (d) is rightfully obtained by the Receiving Party from third parties; or (e) is otherwise required to be disclosed by law or judicial process.

5.4 Information related to this Agreement shall be deemed Confidential Information, but in the event either Party wishes to disclose such information, such Party shall seek the prior written consent of the other, and such consent shall not be unreasonably withheld.

5.5 Unless required by Law, including but not limited to regulatory or judicial requests for information (whether formal or informal), or to assert its rights under this Agreement, and except for disclosure on a "need to know basis" to its own employees, and its legal, investment and financial advisers, other professional advisers or others as authorized by the Folio Customer to whom the information pertains by affirmative or negative consent, as permitted, on a confidential basis (in each case pursuant to written agreements with each such person requiring it to maintain such information as confidential to the same extent as if it were a party to this Agreement), each Party agrees not to disclose the Confidential Information without the prior written consent of the other Party, which consent shall not be unreasonably withheld.

5.6 This Section 5 shall survive for a period of three (3) years beyond termination of this Agreement, except with respect to Confidential Information that is personal or identifying information regarding or relating to a Folio Customer, in which case this Section 5 shall be indefinite, unless in the case of Issuer such disclosure is authorized by the relevant Folio Customer in connection with the Private Securities and in the case of Folio, is otherwise permitted by Law.

6 REPRESENTATIONS, WARRANTIES AND COVENANTS

6.1 Mutual Representations and Warranties.  Each Party represents and warrants to the other Party that:

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a. it is duly organized and validly existing under the laws of the jurisdiction of its establishment;

b. it has the full power and authority to enter into this Agreement and to perform its obligations under this Agreement;

c. it has obtained all material consents and approvals and taken all actions necessary for it to validly enter into and give effect to this Agreement and to engage in the activities contemplated and perform its obligations under this Agreement;

d. this Agreement will, when executed, constitute lawful, valid and binding obligations on it, enforceable in accordance with its terms; and

e. neither the execution and delivery of this Agreement, nor the performance by such Party of its obligations hereunder will (i) violate any Legal Requirement, (ii) require any authorization, consent, approval, exemption or other action by or notice to any government entity, or (iii) violate or conflict with, or constitute a default (or an event which, with notice or lapse of time, or both, would constitute a default) under the governing documents of such Party or any contract, commitment, understanding, arrangement, agreement or restriction of any kind or character to which such Party is a party or by which such Party or any of its assets or properties may be bound or affected.

6.2 Issuer Representations, Warranties and Covenants.  Issuer represents, warrants and covenants to Folio that:

a. the Private Securities are registered or exempt from the registration requirements of the Securities Act, and the rules and regulations promulgated thereunder, and are registered or exempt from the registration requirements of any state where Issuer from time to time will offer such securities;

b. it will not, during the Term, either (i) act as a "broker" or "dealer" as those terms are defined under the Exchange Act or otherwise in a capacity under any other Law that is not permitted, unless pursuant to an applicable exemption, or provide investment advice with respect to any Folio Customer or (ii), with respect to any Folio Customer, hold or have access to any funds or securities, or extend credit for the purpose of purchasing securities through Folio, including specifically the Private Securities; and

c. Issuer owns the Issuer Brand, Issuer Site and Issuer Content and/or has the right to grant the licenses and/or rights of use as contemplated by this Agreement.

6.3 Folio Representations, Warranties and Covenants.  Folio represents, warrants and covenants to Issuer that:

a. it is, and during the term of this Agreement will remain, duly registered and in good standing as a broker-dealer with the SEC and is a member firm in good standing with FINRA; and

b. Folio owns the Folio Brand, Folio Site and Folio Content and/or has the right to grant the licenses and/or rights of use as contemplated by this Agreement.

6.4 Disclaimer of Warranties.  THE SERVICES ARE PROVIDED ON AN "AS IS" AND "AS AVAILABLE" BASIS.  FOLIO SPECIFICALLY DISCLAIMS ALL WARRANTIES FOR THE SERVICES, EXPRESS OR IMPLIED, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.  NEITHER FOLIO NOR ANY AFFILIATE OF FOLIO WARRANTS THAT THE SERVICE WILL MEET ISSUER'S OR ANY INVESTOR'S REQUIREMENTS OR THAT THE SERVICES WILL BE UNINTERRUPTED OR ERROR-FREE.  NO ORAL OR WRITTEN INFORMATION GIVEN BY FOLIO OR ITS AFFILIATES SHALL CREATE ANY WARRANTIES OR IN ANY WAY INCREASE THE SCOPE OF FOLIO'S OBLIGATIONS HEREUNDER.

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7 LIMITATIONS OF LIABILITY; INDEMNIFICATION

7.1 Limitation of Liability.  IN NO EVENT SHALL EITHER PARTY BE LIABLE TO ANOTHER PARTY FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, PUNITIVE OR EXEMPLARY DAMAGES OF ANY NATURE, EVEN IF SUCH PARTY SHALL HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.  THE FOREGOING SHALL APPLY REGARDLESS OF THE NEGLIGENCE OR OTHER FAULT OF ANY PARTY AND REGARDLESS OF WHETHER SUCH LIABILITY SOUNDS IN CONTRACT, NEGLIGENCE, TORT, STRICT LIABILITY OR ANY OTHER THEORY OF LIABILITY.

7.2 Folio Indemnification.  Issuer agrees to indemnify, defend and hold Folio and its Affiliates and their respective officers, directors, agents and employees (each a "Folio Indemnified Party" or, collectively, "Folio Indemnified Parties") harmless against any investigation, claim, action, or proceeding (including a regulatory inquiry, whether formal or informal or any arbitration or court action) ("Action") brought by a Folio Customer, court, regulator or self-regulatory organization asserting jurisdiction over the Folio Indemnified Party or by any other party against any Folio Indemnified Party if such Action relates to the Issuer, any Affiliate of Issuer, the Securities, the Offering, the marketing and advertising thereof, or that results from any action, inaction, omission, misstatement or statement of Issuer or any person acting in connection with Issuer or on Issuer's behalf (other than any misstatement or statement about Folio provided by Folio) arising out of or based upon (a) the Issuer Site or the offering circular, including any amended versions thereof; (b) any breach or alleged breach of any of Issuer's representations, warranties, covenants or agreements hereunder and including any representations, warranties, covenants or agreements contained in the Schedules to this Agreement; (c) any breach or alleged breach of confidentiality or privacy relating to Issuer's failure or alleged failure to treat any Folio Customer's personal or identifying information as confidential pursuant to Section 5; and (d) infringement or misappropriation by Issuer of any third party's property and/or intellectual property rights, including, but not limited to, patents, trademarks, copyrights, trade secrets and publicity rights.  Further, Issuer shall indemnify the Folio Indemnified Parties against all expenses, fees (including reasonable attorney's fees and other legal expenses), losses, claims, damages, demands, liabilities, judgments (including fines and settlements), costs of investigation or responding to inquiries or otherwise ("Losses") incurred by or levied or brought against the Folio Indemnified Parties arising out of, or related to, Actions warranting indemnification pursuant to this Section 7.2 as such Losses arise.

Promptly after receipt by a Folio Indemnified Party of notice of any claim or the commencement of any Action with respect to which a Folio Indemnified Party is entitled to indemnity hereunder, Folio will notify Issuer in writing of such claim or of the commencement of such Action, and the Issuer, if requested by the Folio Indemnified Party, will assume the defense of such Action and will employ counsel reasonably satisfactory to the Folio Indemnified Party and will pay the fees and expenses of such counsel. Notwithstanding the preceding sentence, the Folio Indemnified Party will be entitled to employ counsel separate from counsel for the Issuer and from any other party in such action if counsel for the Folio Indemnified Party reasonably determines that it would be inappropriate or ill-advised for the same counsel to represent both parties. In such event, the reasonable fees and disbursements of no more than one such separate counsel will be paid by the Issuer, in addition to local counsel.  If the Folio Indemnified Party elects the Issuer to assume the defense of such Action, Issuer will have the exclusive right to settle the claim or proceeding, provided that Issuer will not settle any such claim or Action without the prior written consent of the Folio Indemnified Party, which consent shall not be unreasonably withheld.  If the Folio Indemnified Party assumes the defense (with payment of any related costs and expenses by Issuer), the Folio Indemnified Party will have the exclusive right to settle the claim or proceeding, provided that the Folio Indemnified Party will not settle any claim or Action without the prior written consent of the Issuer, which consent shall not be unreasonably withheld.

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7.3 Issuer Indemnification.  Folio agrees to indemnify, defend and hold Issuer and its Affiliates and their respective officers, directors, agents and employees (each an "Issuer Indemnified Party" and, collectively, "Issuer Indemnified Parties") harmless against any Action brought by an Investor, Folio Customer, court, or regulator asserting jurisdiction over the Issuer Indemnified Party or by any other party against any Issuer Indemnified Party relating to Folio, any Affiliate of Folio or the Services, insofar as the Action arises out of or is based upon (a) the Folio Site; (b) any misstatement or statement about Folio provided by Folio to the Issuer; (c) any breach or alleged breach of any of Folio's representations, warranties, covenants or agreements hereunder and including any representations, warranties, covenants or agreements contained in the Schedules to this Agreement; (d) any and all commitments, representations, warranties or statements of any kind by Folio to any third party regarding the use of the Folio Site; and (e) infringement or misappropriation by Folio of any third party's property and/or intellectual property rights, including, but not limited to, patents, trademarks, copyrights, trade secrets and publicity rights.  Further, Folio shall indemnify the Issuer Indemnified Parties against all Losses incurred by or levied or brought against the Issuer Indemnified Parties arising out of, or related to, Actions warranting indemnification pursuant to this Section 7.3 as such Losses arise.

Promptly after receipt by an Issuer Indemnified Party of notice of any claim or the commencement of any Action with respect to which an Issuer Indemnified Party is entitled to indemnity hereunder, Issuer will notify Folio in writing of such claim or of the commencement of such Action, and Folio, if requested by the Issuer Indemnified Party, will assume the defense of such Action and will employ counsel reasonably satisfactory to the Issuer Indemnified Party and will pay the fees and expenses of such counsel. Notwithstanding the preceding sentence, the Issuer Indemnified Party will be entitled to employ counsel separate from counsel for Folio and from any other party in such action if counsel for the Issuer Indemnified Party reasonably determines that it would be inappropriate or ill-advised for the same counsel to represent both parties.  In such event, the reasonable fees and disbursements of no more than one such separate counsel will be paid by Folio, in addition to local counsel.  If the Issuer Indemnified Party elects Folio to assume the defense of such Action, Folio will have the exclusive right to settle the claim or proceeding, provided that Folio will not settle any such claim or Action without the prior written consent of the Issuer Indemnified Party, which consent shall not be unreasonably withheld.  If the Issuer Indemnified Party assumes the defense (with payment of any related costs and expenses by Folio), the Issuer Indemnified Party will have the exclusive right to settle the claim or proceeding, provided that the Issuer Indemnified Party will not settle any claim or Action without the prior written consent of Folio, which consent shall not be unreasonably withheld.

7.4 No Claim Preclusion.  Nothing in this Section shall be construed to preclude either Party from making any claim against the other arising out of a failure to perform obligations under this Agreement.  Neither Party shall be precluded from claiming or commencing an action for contribution to any amounts the other may be required or otherwise agree to pay to an Investor or other third party, including a regulator, with jurisdiction over the Services.

8 TERM AND TERMINATION

8.1 Term.  This Agreement shall be effective on the Effective Date, and continue in force for so long as the Private Securities remain on the Private Placements Platform (the "Term"), unless otherwise terminated pursuant to the provisions of this Section 8.

8.2 Termination Without Cause.  This Agreement may be terminated without cause:

a. by either Party, upon ninety (90) days prior written notice, if there are no Investors or, if there are Investors, after a reasonable time to implement the orderly transition specified in Section 8.7;

b. by Issuer, upon providing notice to Folio within thirty (30) days after receipt of an amended Schedule D received pursuant to Section 3.4, in the event of a change in Fees pursuant to Section 3.3 that materially increases either the aggregate Fees paid to Folio by Issuer or the Fees to be paid to Folio by Issuer in the event of a termination.

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8.3 Termination for Regulatory, Legal, Reputational or Other Risks.

a. In the event that any due diligence or investigation results in findings that would pose regulatory, legal, reputational or other risks to Folio, Folio shall provide Issuer notice of such risks and a reasonable opportunity to cure them.  If the risks are not addressed or cured to Folio's reasonable satisfaction, Folio may terminate this Agreement.  Folio will facilitate the orderly transition of the custody of the Private Securities to such person designated by the Issuer in accordance with Section 8.9.

b. In Folio's sole discretion, if the risks described in 8.3(a) are of sufficient size, significance or immediacy that a delay in termination of this Agreement would be inappropriate, Folio may terminate this Agreement immediately.

8.4 Termination for Cause or Insolvency.  Either Party may terminate this Agreement immediately if the other Party:

a. is in breach of any material obligation herein or in the Schedules attached to this Agreement, and (i) such breach is incapable of being cured, or (ii) if such breach is capable of cure, such breach is not cured within thirty (30) days after receipt of written notice of such breach from the non-breaching Party, or within such additional cure period as the non-breaching Party may authorize;

b. voluntarily or involuntarily becomes the subject of a petition in bankruptcy or of any proceeding relating to insolvency, receivership, liquidation or composition for the benefit of creditors; or

c. admits in writing its inability to pay its debts as they become due.

8.5 Termination for Force Majeure.  In the event of a force majeure that lasts longer than thirty (30) days, the Party not experiencing the force majeure event may terminate this Agreement upon written notice to the other Party.

8.6 Compliance with Laws.  If at any point during the Term, either Party's performance under this Agreement conflicts or threatens to conflict with any Legal Requirement, such Party may suspend performance under this Agreement and negotiate in good faith to amend this Agreement so that each Party's performance hereunder complies with such Legal Requirement.  If after thirty (30) days, the parties are unable to agree on a mutually acceptable amendment, either Party may immediately terminate this Agreement upon written notice to the other Party.

8.7 Actions Upon Termination.  Upon the termination of this Agreement, Issuer shall remove all references to any Folio Name, Branding and Content from the Issuer Site or Issuer Content and terminate all links on the Issuer Site to any Folio Site.  Folio shall remove all references to Issuer Name, Branding and Content and terminate all links on the Folio Site to any Issuer Site.  Each Party shall promptly return all Confidential Information, documents, manuals and other materials stored in any form or media (including but not limited to electronic copies) belonging to the other Party, except as may be otherwise provided in this Agreement or required by Law.

8.8 Termination Fee.  Termination Fees are set forth in Schedule D.

8.9 Cooperation.  In all events, if there are one or more Investors at the time of termination, the Parties will cooperate in planning and implementing an orderly transition of the custody of the Private Securities to such person designated by the Issuer authorized under applicable Law to assume custody of the securities, or to the Issuer itself if it is authorized to hold such securities in custody, or to such other person selected by Folio if Issuer does not so select such person within a reasonable period not to exceed ninety (90) days.  In all events, Issuer shall pay the reasonable costs of such transition.  As part of such a transition, the parties agree to seek the affirmative or negative consent of Investors to the sharing of Confidential Information necessary for their transition. 

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9 ARBITRATION

9.1 Arbitration Proceedings Disclosure.  The parties hereby agree to arbitration and agree and acknowledge the following with respect to arbitration proceedings:

a. Arbitration is final and binding on the parties;

b. The parties are waiving their right to seek remedies in court, including the right to a jury trial;

c. Pre-arbitration discovery generally is more limited than and different from court proceedings;

d. The arbitrators' award is not required to include factual findings or legal reasoning;

e. A Party's right to appeal or to seek modification of rulings by the arbitrators is strictly limited; and

f. The panel of arbitrators may include a minority of arbitrators who were or are affiliated with the securities industry.

9.2 Arbitration Agreement.  Any controversy between the parties arising out of this Agreement shall be submitted to arbitration conducted before FINRA Dispute Resolution, and in accordance with FINRA rules.  Arbitration must be commenced by service upon the other Party of a written demand for arbitration or a written notice of intention to arbitrate.  Proceedings and hearings will take place in New York, New York.  Both parties waive any right either of them may have to institute or conduct litigation or arbitration in any other forum or location, or before any other body.  Arbitration is final and binding on both parties.  An award rendered by the arbitrator(s) may be entered in any court of applicable jurisdiction over the parties.

10 GENERAL TERMS AND CONDITIONS

10.1 Compliance with Law.  Each Party agrees to comply with any Legal Requirement applicable to the performance of its obligations hereunder.

10.2 Non-exclusive Folio Relationship.  Folio reserves the right, without obligation or liability to the Issuer, to market and provide either directly, through other parties, or through any other type of distribution channel,  services to others that are the same as or similar to the Services.

10.3 No Agency.  Neither Party is an agent, representative or partner of the other Party.  Neither Party shall have any right, power or authority to enter into any agreement for or on behalf of, or to incur any obligation or liability for, or to otherwise bind, the other Party.  This Agreement shall not be interpreted or construed to create an association, joint venture, co-ownership, co-authorship, or partnership between the parties or to impose any partnership obligation or liability upon either Party.

10.4 Amendments and Modifications.  No change, amendment or modification of any provision of this Agreement will be valid unless set forth in writing and signed by the Parties.

10.5 Assignment.  Issuer shall not assign, sublicense or otherwise transfer this Agreement or any right, interest or benefit hereunder, except by operation of law, without the prior written consent of Folio, which consent may be withheld in Folio's sole discretion.  Folio shall have the right to assign, sublicense or otherwise transfer this Agreement or any right, interest or benefit hereunder, including an assignment by operation of law, to any affiliate of Folio that is properly authorized under applicable Law to provide the Services by giving notice to Issuer within thirty (30) days of any of the actions listed herein.

10.6 Governing Law.  This Agreement shall be interpreted, construed and enforced in all respects in accordance with the laws of the Commonwealth of Virginia, except with respect to the choice of law provisions therein or to the extent inconsistent with FINRA Rules applicable to an arbitration proceeding under Section 9 above.

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10.7 No Waiver.  The failure of either Party to insist upon or enforce strict performance by the other Party of any provision of this Agreement or to exercise any right under this Agreement shall not be construed as a waiver or relinquishment to any extent of such Party's right to assert or rely upon any such provision or right in that or any other instance; rather the same shall be and remain in full force and effect.

10.8 Notice.  Any notice required or permitted under this Agreement shall be in writing and delivered to the receiving Party's principal place of business as set forth on the signature block to this Agreement in a manner contemplated in this Section and addressed to the attention of its General Counsel.  Notice shall be deemed duly given (a) if delivered by hand, when received, (b) if transmitted by email, upon confirmation that the entire document has been successfully received, (c) if sent by recognized overnight courier service, on the business day following the date of deposit with such courier service so long as the deposit was made by that overnight courier service's deadline or on the second business day following the date of deposit if after that overnight courier service's deadline, or (d) if sent by certified mail, return receipt requested, on the third business day following the date of deposit in the United States mail.

10.9 Entire Agreement.  This Agreement and the Schedules hereto and incorporated herein by reference constitute the entire agreement between the Parties and supersede any and all prior agreements or understandings between the parties with respect to the subject matter hereof.  Neither Party shall be bound by, and each Party specifically objects to, any term, condition or other provision or other condition which is different from or in addition to the provisions of this Agreement (whether or not it would materially alter this Agreement) and which is proffered by the other Party in any purchase order, correspondence or other document, unless the Party to be bound thereby specifically agrees to such provision in writing.

10.10 Severability; Survival.  In the event that any provision of this Agreement conflicts with the law under which this Agreement is to be construed or if any such provision is held invalid by a court with jurisdiction over the parties to this Agreement, such provision shall be deemed to be restated to reflect as nearly as possible the original intentions of the parties in accordance with applicable Law, and the remainder of this Agreement shall remain in full force and effect. All provisions herein that by their terms or intent are to survive the termination of this Agreement shall so survive, specifically including Sections 3, 5, 6, 7 and 9.

10.11 Headings.  The headings used in this Agreement are for convenience only and are not to be construed to have legal significance.

10.12 Third Parties.  This Agreement is between the Parties hereto and is not intended to confer any benefits on third parties including, but not limited to, Investors.

10.13 Force Majeure.  Neither Party will be liable for delay or default in the performance of its obligations under this Agreement if such delay or default is caused by conditions beyond its reasonable control, including, but not limited to, fire, flood, accident, earthquakes, telecommunications line failures, storm, acts of war, riot, acts of terrorism, government interference, strikes and/or walk-outs.  In addition, Folio shall not be responsible for downtime or other problems with any website, including the Folio website, caused by any public or third party private network, including the Internet or any communications carrier network, or computer hardware or software problems regardless of whether they arise in the ordinary course of business or constitute extraordinary events.

[Signature Page Follows]

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This Agreement contains an arbitration agreement.

IN WITNESS HEREOF, the parties hereto have caused this Agreement to be executed by duly authorized officers or representatives as of the Effective Date.

Folio:                                     Folio Investments, Inc.

By:  _____________________________________

         Michael J. Hogan, Chief Executive Officer

Address:  8180 Greensboro Drive, 8^th Floor, Mclean, VA 22102

Issuer:                                   [___________________________]

By:  _____________________________________

[___________________]

Address:

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SCHEDULE A – Private Securities and Internet Sites Used for Offering Such Securities

1. Description of the securities.

2. URLs for Internet Sites Used for Offering Such Securities or N/A:

SCHEDULE B-1 – Escrow, Custody and Related Services by Folio

Pursuant to Sections 2.1 and 2.2 of this Agreement, Folio agrees to provide, perform or make available the following to Issuer:

1. Escrow-less Closing Services. Folio provides its escrow-less money transfer functions for funding an investment in an Offering through a brokerage account (replacing the function of a bank escrow agent) under an SEC no-action letter received by Folio Investments, Inc. dated July 15^th, 2015 regarding Exchange Act Rule 15c2-4(b)(1), subject to the fees specified in Schedule D.1 of this Agreement.  This service involves setting up an account for the Issuer, setting up customer accounts for the investors, receiving money into the customer accounts, and conducting closings in which funds in customer accounts are transferred from those accounts to Issuer's account in amounts equal to subscription requests Issuer has accepted. These services include anti-money laundering ("AML"), Office of Foreign Asset Control ("OFAC") and related services required for any funds transfers.

2. Use of the Folio Private Placements Platform.   Folio will make tools available to Issuer for the Issuer to perform or Folio to perform on behalf of Issuer, the following activities with respect to the Private Placements Platform, subject to the fees specified in Schedule D.2 of this Agreement:

a. display information regarding the Offering as provided and instructed by the Issuer or an agent of the Issuer, including, but not limited to the number of units of the Private Securities available, price, and terms;

b. provide the ability for a Folio Customer, through a link to a third party hosting site or otherwise,  to view such documents as the Issuer has created and determines to make available to potential investors relating to the Securities, including, but not limited to, an offering circular or a private placement memorandum and subscription agreement or other similar offering materials, and to submit a subscription request for an Offering;

c. provide information provided by Folio Customers relating to their qualifications to purchase the Securities, including presenting Issuers with successfully submitted subscription requests for review;

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d. verify that a Folio Customer has the appropriate status to purchase the Private Securities based on the status requirements specified by the Issuer on the Private Placement Platform (in connection with such verification, Folio relies solely on the information or documents with respect to net worth or income as provided by such Folio Customer to Folio, on the representation of verified status from a certified public accountant or licensed attorney or other person reasonably capable of providing such attestation, or such other third party services that Folio reasonably believes can provide such verification.  Folio cannot represent or warrant that such information or documents are accurate or complete and disclaims liability for any determination by Folio of such status in reliance on such information, documents or representations to the extent that Folio has a reasonable belief that it has relied in good faith on such information or attestation or service). Additional fees apply for Regulation D Rule 506(c) verification of accredited investor status;

e. provide a mechanism for the Issuer to review, accept or reject subscribers to its offering, including enabling investors and issuers to confirm that sufficient cash has been deposited into customer accounts to satisfy subscription requests prior to the cash required by date, and notifying users of the cash required by date for an offering prior to subscription;

f. provide Investors with a mechanism to view the status of their subscription and the date that the issuer has set for cash required for closing; and

g. if requested by the Issuer, seek, on behalf of the Issuer and at the Issuer's expense (additional fees apply), to make available the Private Securities for purchase in Individual Retirement Accounts (in connection with such request, Folio can make no assurances that the Private Securities will be approved for holding in Individual Retirement Accounts, as such accounts are held by a third party custodian who reviews the request and makes a determination in its sole discretion).

3. Custody and Transfer of Private Securities.  After the Issuer has executed a Folio Customer Account Agreement, Folio will, in the ordinary course, and consistent with Folio's policies and procedures as in existence from time to time, maintain an account for the benefit of Issuer to hold the Private Securities, whether in certificated or uncertificated form, for the Issuer's benefit and any other securities or cash as may be purchased and/or deposited or held by the Issuer in its account with Folio.  These services, which are subject to the fees specified in Schedule D.1 and replace certain functions of transfer agents under an SEC no-action letter received by Folio Investments, Inc. dated January 13^th, 2015 regarding Exchange Act Rule 15c3-3(c)(7), include the following:

a. maintaining books and records identifying each Investor, each Investor's address, the terms of the Private Securities in which each Investor invests, and a log of all transactions with each Investor (collectively, "Books and Records) in accordance with Law as it does in the ordinary course with respect to any customer of Folio's holding securities on the Folio platform;

b. providing the Issuer with a mechanism for the Issuer to reconcile with Issuer records Investor holdings of the Private Securities from time to time (at the omnibus level and at the individual beneficial holder level, subject to Issuer maintaining the confidentiality of such information as set forth in Section 5 of this Agreement); and

c. maintain records of identifying information regarding Investors (subject to Section 5 of this Agreement).

As custodian, Folio will may provide the following additional services, subject to the fees specified in Schedule D.3, D.4, D.5, D.6, and D.7 of this Agreement if and when they occur, including but not limited to:

a. transfer cash and the Private Securities, if permitted, between an Investor account and the account of another Folio Customer, subject to the transaction fees payable for those services at this time, which are not specified in this Agreement;

b. record and process transactions between the Issuer and Investors in the Private Securities such as cash and securities distributions; and

c. process communications between the Issuer and Investors regarding the offering of the Private Securities, and other corporate actions.

Private Securities may have restrictions on the transfer of beneficial ownership.  Folio will, in good faith, attempt to prevent transfers of the Private Securities without the Issuer's consent, except as required by or pursuant to operation of Law.  It is Issuer's obligation to ensure compliance with transfer restrictions that may apply to Issuer's offering of securities.

Book entry custody of shares for issuers and investors under this Agreement are performed pursuant to an SEC no-action letter received by Folio Investments, Inc. dated January 13^th, 2015 regarding Exchange Act Rule 15c3-3(c)(7)).

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SCHEDULE B-2 – Obligations of Issuer in Connection with Custodial and Related Services

Notwithstanding the Services as provided under the Agreement, Issuer solely is responsible for maintaining all records of Private Securities, which, if permitted by Law, may be done by evidencing the number of units of the Private Securities held in the omnibus position by Folio as nominee custodian for Folio Customers, and for maintaining accurate and complete records of the aggregate total units of Private Securities sold and redeemed by Issuer through the Folio platform.  Pursuant to its obligations, Issuer shall:

1. based upon the Books and Records provided by Folio or an Affiliate of Folio from time to time, maintain an accurate and complete record on its official books and records of the number of units (which may be in aggregate if permitted by Law) of Private Securities and, if permitted by Law, as held by Folio as nominee custodian for Folio Customers noting that such units are held by "FolioInvestments, Inc. for the exclusive benefit of its customers", or if certificated, deliver to Folio an original, duly issued and outstanding unit certificate in the name of "FolioInvestments, Inc. for the exclusive benefit of its customers" in an amount equal to the number of units of Private Securities held by Shareholders;

2. maintain an accurate and complete record on its official books and records of the number of units of Private Securities, if any, held by Folio for Folio's own benefit, or if certificated, deliver to Folio an original, duly issued and outstanding unit certificate in the name of "Folio Investments, Inc." in an amount equal to the number of units of Private Securities held by Folio;

3. provide to Folio a statement and attestation, in the form and at the time that Folio may reasonably require from time to time each calendar quarter, indicating the number of units of the Private Securities recorded in the Issuer's records as being held by "FolioInvestments, Inc. for the exclusive benefit of its customers" and as being held by Folio itself for its own benefit, if any, as of the last day of such quarter, and, if certificated, attesting to (A) the authenticity of the certificate(s) in Folio's possession, (B) that the certificate(s) represent(s) the number of units of Private Securities represented in the Issuers records, and (C) that the certificate(s) in Folio's possession is/are recorded on the Issuer's official books and records as "FolioInvestments, Inc. for the exclusive benefit of its customers" and "Folio Investments, Inc.", respectively;

4. provide Folio with the option and opportunity to audit, or have a third party audit on Folio's behalf, the Issuer's books and records to confirm any information maintained by the Issuer under the Agreement and authorize Folio to contact the Issuer's auditors and request that they provide confirmation of such information, all at Issuer's sole expense;

5. provide Folio, no later than January 31st of each year, a written letter of assurance on Issuer's letterhead (or on the letterhead of Issuer's counsel on Issuer's behalf or Issuer's audit firm) that the Private Securities identified in Issuer's books and records as held by "FolioInvestments, Inc. for the exclusive benefit of its customers" and/or "FolioInvestments, Inc." or that the units evidenced by certificate(s) in such names are not subject to any right, charge, security interest, lien, or claim of any kind in favor of the Issuer or any person claiming through the Issuer and that all such securities issued and outstanding for the prior year have been validly authorized, duly and validly issued, fully paid and are non-assessable and free of restrictions on transfer other than restrictions on transfer that have been provided to Folio by the Issuer;

6. provide Folio, pursuant to such methods as Folio may reasonably require (e.g., through a designated website or email to Folio's operations department), by the end of the first day of each calendar quarter, and at any time and from time to time as soon as reasonably practicable if there is a material change in value, a statement of the per unit value of the Private Securities as set by an authorized executive of the Issuer or the Issuer's board of directors, which shall constitute an instruction to Folio to communicate to Investors that unit value as the then current value of the Private Securities and to update Investor account values accordingly;

7. provide Folio, pursuant to such methods as Folio may reasonably require, with the details of, and all monies associated with any dividend, interest, principal or other payment due to Investors and a detailed record of the recipients and amounts to be credited thereto and any tax reporting codes in a manner required by Folio from time to time in order for Folio to credit Investors with such payments on a timely basis and to produce relevant tax documentation therefrom (it is agreed that Issuer shall produce or cause to be produced by third parties on behalf of Issuer, at Issuer's expense, any Schedule K-1's or similar documents for delivery by Folio to Shareholders); and; and

8. provide to Folio, in such form and at such time as Folio may reasonably request, a copy of any documentation, memoranda, agreements or other documents or information that Folio believes is necessary for it to satisfy any filing, reporting or other applicable legal requirements it may have relating to the custody of the Private Securities.

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SCHEDULE C – Services Specifically NOT Provided

Unless otherwise specifically agreed to in this Agreement or in a separate written agreement between the Parties, the following services specifically are NOT provided by Folio or any Affiliate of Folio under this Agreement:

1. Services Under Separate Agreement.  This Agreement does not address nor authorize Folio to provide, investment banking or underwriter services to the Issuer, to act as an underwriter or selling group member, to issue the Private Securities, to provide advice or advisory services in connection with the services as set forth in Schedule B, to recommend the Private Securities or the Offering, or to make any suitability determinations with respect to any Folio Customer.  Folio is not committing to and does not intend to purchase any of the Private Securities for its own account or that of an Affiliate.  However, the Issuer and Folio understand and agree that, in addition to the services provided herein and under a separate agreement entitled "Participating Dealer or Selling Agreement" or "Distribution Agreement" or other substantially similar agreement ("Selling Agreement") which may be entered into between the issuer or sales agent and Folio, Folio may participate in the offering as a dealer in the sale of the Securities.  In its capacity as a dealer, Folio shall be entitled to receive a reallowance on commissions in accordance with the Selling Agreement, which shall be compensation for Folio's portion of the commissions as a Dealer and shall be separate and distinct from the fees set forth in Schedule D of this Agreement.  

2. No Approval of Issuer Content.  Folio is not preparing, endorsing, adopting, or approving in any way any offering memoranda or other offering documents, SEC, state or other regulatory filings, or any sales or marketing material or Issuer Content, specifically including any Issuer Sites, or any other material or Content of any kind wherever they may appear except to the extent that such websites, material or Content specifically reference the Folio Name, Branding, Content, or descriptive materials about the Services, and then only to the extent of such references and specifically not including other portions of such website or materials.

3. No Setting, Reviewing or Guaranteeing of Price, Tax or Other Data.  Folio is not setting, calculating, creating, approving, endorsing, adopting, reviewing, recommending or guaranteeing any price for the Private Securities, or giving any opinion with respect to the accuracy, reliability or completeness of any data or information about the Private Securities appearing on a Folio Site or elsewhere.  Folio is relying on the Issuer for all such data and information.  Folio is not preparing or calculating any tax statements or documentation on behalf of Issuer, specifically including Schedule K-1s, except for those tax documents normally and usually included as part of a brokerage account (such as 1099s).

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SCHEDULE D – Fees and Other Costs

1. Escrow-less Closing and Book Entry Custody Fees. 

a. Reserved when Folio is compensated by an intermediary broker dealer instead of the issuer, or

b. Fourty basis points (40 bps) of the dollar value of the securities issued to Shareholders pursuant to each Offering at the time of closing, with a minimum fee to Folio of the greater of (a) $30 per Shareholder per Offering, or (b) $10,000 per Offering.

2. Private Placement Platform Fees.

a. Reserved when Folio is compensated by an intermediary broker dealer instead of the issuer, or

b. Ten basis points (10 bps) of the dollar value of the securities issued to Shareholders pursuant to each Offering at the time of closing.

3. Due Diligence Fees.

a. Reserved when issuer due diligence is performed an intermediary broker dealer instead of Folio, or

b. Issuer shall pay Folio fees (whether charged by Folio or by a third party) related to conducting due diligence with respect to the Offering, the Issuer or any principal or other person associated with the Issuer that Folio deems necessary or appropriate, which will generally be $10,000 per Offering but may be greater if additional efforts are necessary to conduct adequate due diligence. Folio will consult with the issuer before deciding to incur additional costs and will only incur such fees with the agreement of both Parties. Due Diligence Fees are payable even if no securities are issued.

4. Fee for Termination and Transfer of Private Securities Pursuant to Section 8 Not Related to the Failure of an Offering to be Completed.  For terminations pursuant to Sections 8.2(a), 8.3(a) or 8.4(a) that are not related to and do not arise from the failure of an Offering to be completed under the terms of this Agreement, and for which there are any Shareholders for Folio to transfer to another firm, Issuer shall pay a termination fee ("Termination Fee") that is the greater of (a) $25,000, or (b) the current number of Shareholders of Private Securities as established at the time of transition, multiplied by $250; provided, however, that the Termination Fee shall not apply for terminations under Section 8.2(a) if the termination is by Folio.  This Termination Fee does not apply if securities are transferred through the DTCC ACAT system to other custodians, though the transfer fees paid by customers in section 7 below would apply.

5. Administrative Expenses. The Issuer shall bear and pay all costs, fees and expenses relating to the preparation, printing, filing and dissemination of information relating to the securities issued to Shareholders pursuant to each Offering and any amendments or supplements thereto, including any federal or state fees imposed on the Issuer or on Folio relating to the Offering, including but not limited to any costs, fees or expenses incurred by Folio in connection with the filing of documents with regulatory authorities (such as costs for federal and state filings of the Offering under Regulation D (e.g., Form D) or Regulation A of the Securities Act (e.g., Form 1-A and FINRA Rule 5110)), and any fees or expenses relating to the issuance and/or delivery of the securities (such as transfer agent fees, certificate fees, DTCC fees, NSCC fees).

6. Service Fees.  Based upon Issuer request and specific requirements provided by the Issuer, an Issuer may be charged the following service fees, each of which is subject to change at any time in Folio's sole discretion:

a. Private Securities Proxy, Corporate Action, and Corporate Communication Fees – to the extent the Issuer requests Folio to distribute corporate communications and process Investor voting, Issuer will be charged the following fees for corporate action and communication process, as well as any resultant tax documents or customer inquiries. Note that the following fees only apply to the processing of these actions for Private Securities, not those publicly traded securities for which such actions are processed via DTCC, though similar fees do apply for proxy services for public securities.

i. Involuntary corporate action (e.g., split, symbol change): $1 per account, subject to a $500 minimum fee per action.

ii. Voluntary corporate action (e.g., rights offering): $1,500 each action plus the then published fee charged to customers that elect to participate in a public or Private Security voluntary corporate action.

iii. Proxy solicitation, voting, tabulation: $1 per account, subject to a $1,500 minimum fee.

iv. Investor tax Documents (e.g., 1099): $3 per tax document generated as a result of the issuer's security.

v. Customer inquiries will be charged at the then applicable hourly rate for customer service

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b. Private Securities Dividend, Interest, Principal Payments, Return of Capital and Other Corporate Cash Flows – to the extent the Issuer requests Folio to process and distribute corporate cash flows, Issuer will be charged the following fees for processing corporate cash flows and any resultant tax documents or customer inquiries. Note that such fees only apply to the processing of these actions for Private Securities, not those publicly traded securities for which such actions are processed via DTCC.

i. $1 per account, subject to a $500 minimum fee per distribution.

c. Private Securities Review for Purchase by IRA Accounts – to the extent the Issuer requests the Private Securities to be available for purchase by IRA accounts, a one-time fee will be charged per Private Security identified on Schedule A for evaluation, which may or may not result in approval.  This fee currently is $300 per Private Security.

d. Supplemental Tax Document Processing – to the extent the Issuer requests document processing services beyond the activities set forth in Schedule B, including, but not limited to, processing document corrections based on reclassification of disbursements or additional processing of tax documents (e.g., corrected 1099s), additional fees may be charged at the time and at the rate incurred by Folio plus overhead.

e. Private Securities Transfers and Secondary Transactions – to the extent the Issuer requests that Folio maintain any restrictions on the transfer of beneficial ownership, or allows for transfers of its securities, Folio will, in good faith, attempt to prevent transfers of the Private Securities without the Issuer's consent, except as required by or pursuant to operation of Law.  Issuer will be charged fees for processing such transfers, currently $100 per transfer of book entry shares from one Folio customer account to another Folio customer account per written instructions provided by the issuer, such as for death or divorce transfers. Customers will be charged fees applicable at the time of a secondary transaction for such transactions, which include the transfer of book entry shares and money in payment for such shares.

f. DTCC eligibility filing on UW Source – to the extent the Issuer requests that Folio file for DTCC eligibility using the DTCC UW Source application, a one-time fee will be charged per Private Security identified on Schedule A for submission, which may or may not result in DTCC approval.  This fee currently is $10,000 and is subject to change at any time in the sole discretion of Folio.  For DTCC eligibility applications outside of the UW Source application, this fee will increase to reflect DTCCs higher fee for applications submitted outside of UW Source. Additional fees apply for Folio to refile a DTCC submission. The issuer is responsible for obtaining a CUSIP for its offering prior to the DTCC submission, and providing that CUSIP, finalized offering documents (SEC qualified for Regulation A) if applicable, and a legal opinion to Folio for submission to DTCC.

7. Fees to Folio Customers. Folio in its sole discretion may charge fees to Folio Customers that are related to the brokerage account or activities in the brokerage account with Folio, which can generally be accessed here: https://www.folioinvesting.com/folioinvesting/pricing/special-services-fees/ but customers will not be charged any fees for purchasing the Private Securities in the Offering.

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EX1A-11 CONSENT

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

We hereby consent to the use in the Offering Circular constituting a part of this Offering Statement on Form 1-A, as amended, of our independent auditors' report dated January 18, 2017 relating to the balance sheet of Secured Real Estate Investment Fund II, LLC as of December 31, 2016, and the related statement of operations, changes in members' equity, and cash flows for the period from June 15, 2016 (Formation) through December 31, 2016, and the related notes to the financial statements, which includes an explanatory paragraph regarding substantial doubt about its ability to continue as a going concern.  We also consent to the reference to our Firm under the heading "Experts" in such Offering Circular.

/s/ dbbmckennon

dbbmckennon

Newport Beach, California

February 3, 2017

EX1A-12 OPN CNSL

Secured Real Estate Income Fund II, LLC

2105 South Bascom Avenue, Suite 190

Campbell, CA 95008

Ladies and Gentlemen:

We have acted as counsel to Secured Real Estate Income Fund II, LLC, a Delaware limited liability company (the "Company"), in connection with the Offering Statement on Form 1-A (the "Offering Statement") being filed by the Company with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "Securities Act"), and Regulation A thereunder. The Offering Statement relates to the issuance and sale by the Company of up to $50,000,000 of Class A Units of the Company (the "Units").

As such counsel, we have examined such documents and such matters of fact and law that we have deemed necessary for the purpose of rendering the opinion set forth herein. As to questions of fact material to this opinion, we have relied on certificates or comparable documents of public officials and of officers and representatives of the Company. In rendering the opinion expressed below, we have assumed without verification the genuineness of all signatures, the legal capacity of natural persons, the authenticity of all documents submitted to us as originals, the conformity to the originals of all documents submitted to us as copies and the authenticity of the originals of such copies.

Based on the foregoing, and subject to the qualifications, assumptions and limitations stated herein, we are of the opinion that the Units have been duly authorized and, when the Units have been duly issued and delivered against payment therefore in accordance with the terms of the Subscription Agreement, the Units will be validly issued, and purchasers of the Units will have no obligation to make payments to the Company or its creditors (other than the purchase price for the Units) or contributions to the Company or its creditors solely by reason of the purchasers' ownership of the Units.

Our opinion that any document is legal, valid and binding is qualified as to:

(a)            limitations imposed by bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance, moratorium or other laws relating to or affecting the rights of creditors generally;

(b)            rights to indemnification and contribution, which may be limited by applicable law or equitable principles; and

(c)            general principles of equity, including without limitation concepts of materiality, reasonableness, good faith and fair dealing, and the possible unavailability of specific performance or injunctive relief and limitation of rights of acceleration, regardless of whether such enforceability is considered in a proceeding in equity or at law.

This opinion is limited to Delaware General Corporation Law and excludes Federal laws and any state blue sky securities law matters.

We hereby consent to the filing of this opinion letter as Exhibit 1A-12 to the Offering Circular included in the Offering Statement. In giving this consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act.  We consent to the reference to Carman Lehnhof Israelsen, LLP under the caption "Legal Matters" in the Offering Statement.

This opinion letter is given as of the date hereof, and we express no opinion as to the effect of subsequent events or changes in law occurring or becoming effective after the date hereof.  We assume no obligation to update this opinion letter or otherwise advise you with respect to any facts or circumstances or changes in law that may hereafter occur or come to our attention (even though the change may affect the legal conclusions stated in this opinion letter).

Respectfully submitted,

/s/ Carman Lehnhof Israelsen, LP

CARMAN LEHNHOF ISRAELSEN, LP

EX1A-12 OPN CNSL

February 1, 2017

Secured Real Estate Income Fund II, LLC8315 E. Broadway Blvd.Tucson, AZ  85710

Ladies and Gentlemen:

We have acted as special counsel to Secured Real Estate Income Fund II, LLC, a Delaware limited liability company (the "Company"), in connection with certain US federal tax issues relating to the Company's offering statement and offering circular (the "Offering Circular") pursuant to Regulation A promulgated by the U.S. Securities and Exchange Commission, and declared effective by the Commission on the date hereof.

You have requested our opinion as to certain federal income tax issues with respect to the Company's treatment as a partnership for federal income tax purposes.

Unless otherwise defined, all capitalized terms used but not defined herein shall have the same meaning as defined in the Offering Circular.

In connection with the opinions rendered below, we have examined the following:

1. the Company's Operating Agreement (the "Operating Agreement");

2. the Offering Circular;

3. a Representation Letter of the Managing Member of the Company, dated as of the date hereof (the "Representation Letter"); and

4. such other documents as we have deemed necessary or appropriate for purposes of this opinion.

In connection with the opinions rendered below, we have assumed that:

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A. each of the documents referred to above has been duly authorized and executed; is authentic, if an original, or is accurate, if a copy; and has not been amended;

B. all facts and statements included in the Representation Letter are true, accurate, and complete, and the Company will operate in such a manner that will make such representations true and accurate;

C. the Company will not make any amendments to its organizational documents, including the Operating Agreement, after the date of this opinion that would affect the Company's treatment as a partnership for federal income tax purposes for any taxable year.

To the extent that any of the representations provided to us in the Representation Letter relate to matters set forth in the Internal Revenue Code of 1986, as amended (the "Code"), or the Treasury regulations thereunder (the "Regulations"), we have reviewed with the individuals making such representation the relevant portion of the Code and the applicable Regulations and are reasonably satisfied that such individuals understand such provisions and are capable of making such representations.

Based on the documents and assumptions set forth above, the representations set forth in the Representation Letter, and the disclosures and statements in the Offering Circular under the captions "Risk Factors - Our classification as a publicly traded partnership not taxable as a corporation is not free from doubt and could be challenged" and "Federal Income Tax Considerations" (which are incorporated herein by reference), we are of the opinion that:

I. although the issue is not free from doubt due to the lack of clear guidance and direct authority, the Company's proposed method of operation, as described in the Offering Circular and as set forth in the Representation Letter, will permit the Company to not be classified for U.S. federal income tax purposes as a publicly traded partnership taxable as a corporation; and

II. the descriptions of the law and the legal conclusions contained in the Offering Circular under the caption "Risk Factors – Our classification as a publicly traded partnership not taxable as a corporation is not free from doubt and could be challenged" are correct in all material respects, and the discussion contained therein fairly summarizes the federal tax considerations that are material to a purchaser of Class A Units of the Company.

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With respect to our opinion in (I) above, the listing of the Class A Units of the Company on a national securities exchange will cause the Company to be treated as a "publicly traded partnership" for federal income tax purposes. Although a "publicly-traded partnership" is generally treated as a corporation for federal income tax purposes pursuant to the general rule of Code Section 7704, an exception is provided for a publicly-traded partnership which derives 90 percent or more of its gross income for its taxable year from certain qualifying sources listed in Code Section 7704(c). Such sources include, inter alia, interest income (other than interest dependent on the income or profits of any person) and gain from the sale or exchange of capital assets (including real property held for investment) or assets used in a trade or business which produce interest income. However, taxable interest is not treated as qualifying income if it is derived in the conduct of a financial or insurance business. Based on representations made by the Company as to (i) its intention to act as an investor (and not as a dealer) with respect to its investments and that it has not, and will not, engage in a lending, banking, or similar business, (ii) its lack of employees actively engaged in the operations of the Company, (iii) its commitment not to register as an investment company pursuant to the Investment Company Act of 1940, not to be treated as a business development company or common trust fund, and not to elect to be treated as a corporation for income tax purposes, and (iv) its intention that in all years of the Company's existence at least 90% of its gross income will be interest income (other than interest determined in whole or in part on the income or profits of any person) or gains from the sale or disposition of real property, we have rendered the opinion in (I) above.

We will not review on a continuing basis the Company's compliance with the documents or assumptions set forth above, or the representations set forth in the Representation Letter, Offering Circular and Operating Agreement. Accordingly, no assurance can be given that the actual results of the Company's operations for any given taxable year will satisfy the requirements for treatment as a partnership.

The foregoing opinions are based on current provisions of the Code and the Regulations, published administrative interpretations thereof, and published court decisions. The Internal Revenue Service has not issued Regulations or administrative interpretations with respect to various provisions of the Code relating to partnership classification. No assurance can be given that the law will not change in a way that will prevent the Company from being classified as a partnership for federal income tax purposes.

We hereby consent to the references to Durham Jones & Pinegar, PC under the captions "Risk Factors - Our classification as a publicly traded partnership not taxable as a corporation is not free from doubt and could be challenged" and "Federal Income Tax Considerations" in the Offering Circular.

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The foregoing opinions are limited to the federal income tax matters addressed herein, and no other opinions are rendered with respect to other federal tax matters or to any issues arising under the tax laws of any state or locality. We undertake no obligation to update the opinions expressed herein after the date of this letter. This opinion letter is solely for the information and use of the addressee, and, other than the members of the Company, may not be relied upon for any purpose by any other person without our express written consent.

Very truly yours,

/s/ Durham Jones & Pinegar, P.C.

Durham Jones & Pinegar, P.C.

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EX1A-13 TST WTRS

EX1A-13 TST WTRS

VIDEO SCRIPT

www.SecuredRealEstateFunds.com

The Secured Real Estate Income Fund Explained

It's not always easy for a real estate developer to find financing.

Banks prefer to lend for very large construction projects.

So developers in need of short-term loans for smaller projects -- new construction or renovations -- have to look elsewhere for financing.

They're  searching for partners who can fund not only construction, but also the actual purchase of properties, which can be sold after the construction is completed.

For a developer, it's worth it to pay a high interest rate to borrow, because in return he gains a financing partner who makes the project possible.

Upon completion, the property's value could rise significantly, creating the opportunity for a profitable sale.

These are the kinds of projects to which the Secured Real Estate Income Fund lends. The loans to proven developers are secured by a mortgage on the property and are typically short-term, about 12-18 months.

That's enough time to renovate a single or multi-family home, build a new one, or upgrade a small commercial building—like an office or a strip mall. Following construction, the property is sold with the profits shared between the developer and the Fund.

Here's an example to give us a closer look at the process. A developer joins with a fund to purchase a multi-family rental property in a desirable location, valued at $1 million.

The property is 30 years old; the kitchens and bathrooms need upgrading.

The developer borrows $1 million to buy the property and pay for construction expenses. It's a 12 month loan at an interest rate of 10%. The developer also agrees to pay the lender "points" upfront.

The developer renovates the apartments, paying interest on the loan each month. At the end of the 12 month loan term, he pays the full principal of the loan back to the fund.

With shiny new kitchens and bathrooms, the property's value increases dramatically. The developer then sells the property for $1.5 million, a gain of 50%.  He and the Fund share the profits. It's a win-win for the developer and the Fund.

Individual investors can participate in such lending through the Secured  Real Estate Income Fund. The Fund uses investors' capital to lend to established, reputable developers.

The loans are 'secured' by the property, which is the collateral. That helps protect the investors' capital. And the loans are usually short-term- no longer than 18-months.

Investors receive an annual return of 8%, with payments made on a monthly basis by direct deposit to their checking accounts, meaning a $100,000 investment returns $666 every month…an annual total of $8,000.

That's far higher than yields available from most other investments, including bank CDs, bonds, even "high yield" bonds known as "junk" bonds.

The Fund provides additional profit sharing for investors, such as distributions of profits from property sales.

The Secured Real Estate Income Fund provides individual investors access to the private real estate lending market, which is normally reserved only for ultra-high net worth individuals.

The Secured Real Estate Income Fund typically lends to numerous projects at the same time, in prime locations around the United States. This diversifies the fund's risk—it doesn't have all its eggs in one basket.  The loans will be made to a mix of residential and commercial developers.

The Fund will normally lend no more than 70% of the improved value of the property to ensure a safety cushion in case of a downturn. Construction loans include  a "holdback"- money is lent gradually to the developer as he completes phases of the project.

Here's important information for potential investors to consider. Investors are able to reinvest their monthly income and profit sharing, which will compound returns.

Gains from the Secured Real Estate Income Fund are taxable, but the income can be tax-deferred by holding the fund in a self-directed Individual Retirement Account that a custodian holds as an alternative asset.

The Fund's leadership team, which has decades of experience receives an annual management fee.

The Secured Real Estate Income Fund is not federally insured.

The life of the fund is typically 10 years.

All interested investors must receive an offering memorandum with full details before they can invest.

For more information on the Secured Real Estate Income Funds please

e-mail info@reincomefunds.com or call 888 444 2102.

The following information is displayed on the video:

IMPORTANT INFORMATION AND RISK WARNINGS

This communication is not an offer to sell, or solicitation of offers to buy, securities. Buying Investments can involve risk. The value of your Investments and the income from them can go down as well as up and is not guaranteed at any time. You may not get back the full amount you invested. Information on past performance is not a reliable indicator for future performance. The potential gains and losses that may arise from your investments will depend on your appetite for risk and how you manage your approach to risk. Placing all your money into one type of investment can be a high risk strategy. There is a risk that you may lose the entire principal amount invested. In addition, there can be no assurance that current investments will be realized as projected. Forward-looking statements involve known and unknown risks, uncertainties and other factors, and accordingly, actual results may differ materially from those reflected or contemplated in such forward-looking statements. Information included herein does not constitute investment advice and should not be viewed as a current or past recommendation to buy or sell any securities or to adopt any investment strategy.

Secured Real Estate Income Fund II, LLC ("SREIF" or the "Fund") is "Testing the Waters" under Regulation A of the Securities Act of 1933.  SREIF will only be able to make sales of securities to you after it has filed an offering statement with the Securities and Exchange Commission (the "SEC") and the SEC has qualified the offering statement.  The Information in that offering statement will be more complete than the information that SREIF is providing to you now and it could differ in important ways.  You must read the offering statement and documents filed with the SEC before investing in SREIF.  No money or other consideration is being solicited, and if sent, will not be accepted.  No sales will be made or commitments to purchase accepted until the offering statement is qualified.  Any indication of your interest to invest in SREIF is non-binding.

The information on this page does not constitute, and should not be construed as, an offer to sell securities or a solicitation of an offer to buy securities.  An offer to sell securities is made only through the offering statement, which is available at www.securedrealestatefunds.com.

The information in this video page is not complete. Everything in this video is qualified by the offering statement.  Among other things, this video includes partial information about our financial track record. For more complete information, please refer to section of the offering statement captioned "Past Performance: Our Track Record So Far," available on our website: www.securedrealestatefunds.com.

The information in this video does not constitute, and should not be construed as, investment or tax advice. We do not know about your personal circumstances and are not in a position to know whether this investment is suitable for you. You should consult with your own financial advisor to determine if this investment is right for you.

Neither the Securities and Exchange Commission nor any federal or state securities commission or regulatory authority has recommended or approved any investment or the accuracy or completeness of any of the information or materials provided by or through the website.

EX1A-15 ADD EXHB

TRANSFER AGENT AND REGISTRAR AGREEMENT

This Transfer Agent and Registrar Agreement (the "Agreement"), dated as of _______, 2016, by and between _______________________ a corporation duly organized and existing under the laws of the State of ________ ("Corporation"), and VStock Transfer, LLC, a California limited liability company ("Transfer Agent"), is for the purpose of performing the services described therein.

RECITALS

WHEREAS, the Corporation desires that certain services be provided by the Transfer Agent with regard to the issuance, transfer and registration of certain securities of the Corporation;

WHEREAS, the Transfer Agent is engaged in the business of providing services for issuers of securities and seeks to provide such services to the Corporation; and

WHEREAS, the parties hereto desire to set forth the terms and conditions for the providing of services by the Transfer Agent to the Corporation.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the parties agree as follows:

I.GENERAL APPOINTMENT OF TRANSFER AGENT; DOCUMENTS

a. Pursuant to the Certificate of Appointment, annexed hereto as Exhibit D, the Transfer Agent is appointed as the transfer agent for the issuance, transfer and registration of the Corporation's "Securities" and to perform such other services related to the Securities as provided in the Agreement.  The term "Securities" as used in these Terms & Conditions shall have the meaning set forth in the Certificate of Appointment.

b. The Corporation has provided original or true and correct copies to the Transfer Agent of each of the documents listed on the Legal Document Checklist attached as Exhibit A.

c. The Corporation has accurately completed the Preliminary Information Form attached as Exhibit B and provided a copy to the Transfer Agent.

II.ISSUANCE OF DESIGNATED SECURITIES

The Transfer Agent is authorized and directed to issue Securities of the Corporation from time to time upon receiving from the Corporation the following:

a. Written instructions as to the issuance from an authorized officer of the Corporation.

b. A certified copy of any order, consent, decree or other authorization that may relate to the issuance of the Designated Securities.

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c. An opinion of the Corporation's counsel that (i) the Designated Securities are duly authorized, validly issued, fully paid and nonassessable, (ii) issuance of the Designated Securities has been registered (stating effective date thereof) under the Securities Act of 1933 (as amended) (the "Act") and the class of Securities represented by the Designated Securities has been registered under the Securities Exchange Act of 1934 (as amended), or, if exempt from registration, the basis of such exemption, and (iii) no order or consent of any governmental or regulatory authority other than that provided to the Transfer Agent is required in connection with the issuance of the Designated Securities or, if no such order or consent is required, a statement to that effect.  The opinion should also indicate whether it is necessary that the Designated Securities bear a restrictive legend and the wording of the legend or a statement to the effect that all Designated Securities to be issued are freely transferable upon presentation to the Transfer Agent for that purpose.

d. Such further documents as the Transfer Agent may reasonably request.

III.AUTHORIZED OFFICERS

a. Specimen signatures of the officers of the Corporation authorized to sign the physical evidence of Securities, including any certificate (see Exhibit E) together with any applicable specimen certificates, shall be provided to the Transfer Agent to be used by it for the purpose of comparison.  The Transfer Agent shall be protected and held harmless in recognizing and acting upon any signature, certificates or other document believed by it in good faith to be genuine.  When any officer of the Corporation shall no longer be vested with the authority to sign evidence of Securities for the Corporation, a written notice thereof shall be given to the Transfer Agent and until receipt of such notice the Transfer Agent shall be fully protected and held harmless in recognizing and acting upon the evidence of Securities bearing the signature of such officer or any signature believed by it in good faith to be such genuine signature.

b. The Transfer Agent shall not be charged with notice of any change in the officers of the Corporation until notice of such change shall be given in writing by the Corporation to the Transfer Agent.

c. In the event any officer of the Corporation who shall have signed blank stock certificates or other evidence of Securities (or whose facsimile signature shall have been used) shall die, resign or be removed prior to the issuance of such certificates or other evidence of Securities, the Transfer Agent in its capacity as Transfer Agent or Registrar, may issue or register such stock certificates or other evidence of securities as the stock certificates or evidence of Securities of the Corporation, notwithstanding such death, resignation or removal, unless directed to the contrary by the Corporation in writing.

IV.REGISTRAR; TRANSFER OF SECURITIES

a. The Transfer Agent is authorized and directed to act as the official registrar of: the Securities upon receipt by the Transfer Agent of the completed and signed reliance letter substantially in the form of Exhibit F together with complete, accurate and balanced records referenced therein.

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b. The Transfer Agent is authorized and directed to make transfers of Securities from time to time upon the books of the Corporation as maintained by the Transfer Agent.

c. Securities, in either certificated or book entry form (or other appropriate form of ownership), will be transferred or exchanged upon the surrender of the old Securities (or appropriate instructions in the case of noncertificated shares) in form reasonably deemed by the Transfer Agent to be properly endorsed for transfer, accompanied by such documents as the Transfer Agent may deem necessary to evidence the authority of the person making the transfer.  The Transfer Agent reserves the right to refuse to transfer Securities until it has received reasonable assurance that each necessary endorsement is genuine and effective, that the transfer of the Securities is legally valid and genuine and that the requested transfer is otherwise legally in order.  For that purpose, Transfer Agent may require an acceptable guaranty of the signature of the person signing and appropriate assurance of authority to do so.  The Transfer Agent may rely upon the Uniform Commercial Code, applicable law or regulation, and generally accepted industry practice in effecting transfers, or in delaying or refusing to effect transfers.  The Transfer Agent may delay or refuse to process any transfer that in its reasonable judgment appears improper or unauthorized.  If, on a transfer of a restricted item, Corporation counsel fails to issue an opinion or to provide adequate reasons therefore within a "reasonable" number of business days of a request to do so, the Transfer Agent is authorized, but not required, to process such transfer upon receipt of an appropriate opinion of presenter's counsel.

d. Transfer Agent shall be fully protected and held harmless in recognizing and acting upon written instructions of an authorized officer of the Corporation.

e. When the Transfer Agent deems it expedient it may apply to the Corporation, or counsel for the Corporation, or to its own counsel for instructions and advice; that the Corporation will promptly furnish or will cause its counsel to furnish such instructions and advice, and, for any action taken in accordance with such instructions or advice, or in case such instructions and advice shall not be promptly furnished, the Corporation will indemnify and hold harmless the Transfer Agent from any and all liability, including attorney's fees and court costs.

f. The Corporation will at all times advise the Transfer Agent of any and all stop transfer notices or adverse claims lodged against Securities of the Corporation and further, will promptly notify the Transfer Agent when any such notices or claims have expired or been removed.  The Transfer Agent is not otherwise responsible for stop transfer notices or adverse claims from either the Corporation or third parties unless it has received actual written notice.

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V.RECORDKEEPING

a. The Transfer Agent is authorized and directed to maintain records showing the name and address of, and the number of Securities issued to each holder of, said Securities together with such other records as the Transfer Agent may deem necessary or advisable to discharge its duties as set forth herein.

b. In case of any request or demand for the inspection of the stock records of the Corporation or any other records in the possession of the Transfer Agent, the Transfer Agent will notify the Corporation for instructions permitting or refusing such inspection; provided, however, that the Transfer Agent reserves the right to permit the inspection of the stock records and other records of the Corporation and its holders of securities by any regulatory authority including the Securities and Exchange Commission ("SEC") and the Depository Trust & Clearing Corporation ("DTCC").

VI.RESPONSIBILITIES, INDEMNITIES, AND COMPENSATION HEREUNDER

a. The Transfer Agent may conclusively rely and act or refuse to act without further investigation upon any list, instruction, certification, authorization, stock certificate or other communication, including electronic communication, instrument or paper believed by it in good faith to be genuine and unaltered, and to have been signed, countersigned or executed by any duly authorized person or persons, or upon the instruction of any officer of the Corporation or the advice of counsel for the Corporation, or counsel for the Transfer Agent.  The Transfer Agent may make any transfer or registration of ownership for such securities which is believed by it in good faith to have been duly authorized or may refuse to make any such transfer or registration if in good faith the Transfer Agent deems such refusal necessary in order to avoid any liability upon either the Corporation or itself.  Corporation agrees that it shall not give Transfer Agent direction to take any action or refrain from taking any action, if implementing such direction would be a violation of applicable law or regulation.  Corporation agrees that it shall not direct Transfer Agent to transfer any security if such security is subject to any restriction or prohibition on transfer to or from a securities intermediary in its capacity as such, and Transfer Agent shall be protected in refusing to effect any such transfer.

b. The Transfer Agent may conclusively and in good faith rely and act, or refuse to act, upon the records and information provided to it by the Corporation and its prior transfer agent or recordkeeper without independent review and shall have no responsibility or liability for the accuracy or inaccuracy of such records and information.

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c. The Corporation will indemnify, defend, protect and hold harmless the Transfer Agent and its managers, affiliates, agents, officers and employees (the "Indemnitees") from and against any and all: losses, costs, claims, damages, suits, judgments, penalties, liabilities, and expenses, including, without limitation, reasonable attorney's fees and expenses, incurred or made, arising out of or in connection with any act or omission of a prior transfer agent of the Corporation or the performance of the Transfer Agent's obligations under the provisions of this Agreement, including but not limited to, acting, or refusing to act, in reliance upon any signature, endorsement, assignment, certificate, order, request, notice, report, record, instructions or other instrument or document believed by the Transfer Agent in good faith to be valid, genuine and sufficient (the foregoing are referred to as "Indemnifiable Costs"); provided, however, such indemnification shall not apply to any such act or omission finally adjudicated to have been directly caused by the bad faith or gross negligence of the Transfer Agent.  The Indemnitees shall be under no obligation to institute or defend any action, suit, or legal proceeding in connection herewith or to take any other action likely to involve the Indemnitees in expense, unless first indemnified to the Transfer Agent's satisfaction.  The indemnities provided by this paragraph shall survive the resignation or removal of the Transfer Agent or the termination of this Agreement.  If the indemnification provisions of this Agreement are inadequate or unavailable for any reason, the Indemnitees shall be entitled to contribution from the Corporation and any third-party payors including insurers for all Indemnifiable Costs.

d. Anything in the Agreement to the contrary notwithstanding, in no event shall either party or its respective affiliates, agents, officers, directors, managers and employees be liable under or in connection with this Agreement for special, indirect, incidental, punitive, or consequential losses or damages of any kind whatsoever, including but not limited to lost profits, whether or not foreseeable, even if advised of the possibility thereof and regardless of the form of action in which such damages are sought.

e. The Transfer Agent may, in connection with the services described in the Agreement, engage subcontractors, agents, co- transfer agents or attorneys-in-fact, provided the same shall have been selected with reasonable care.  The Transfer Agent is authorized by the Corporation to execute all agreements, appoint agents or sub-agents and do all other acts deemed necessary to carry out the general purposes of this Agreement.  The Corporation shall provide to the Transfer Agent any books, records, or memoranda which are required in defense of any claim which may arise in the performance of the Transfer Agent's duties hereunder.

f. The Transfer Agent may consult with counsel of its choice, and any advice of such counsel shall be full and complete authorization and protection to the Transfer Agent with respect to any action taken or omitted by it in good faith, in reliance upon such advice, in connection with the performance of its duties or obligations under the Agreement.  The Corporation agrees to reimburse the Transfer Agent for all reasonable expenses, disbursements and counsel fees (including reasonable expenses and disbursements of counsel) incurred with respect thereto.

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g. The Corporation agrees that the Transfer Agent shall be paid fees for its services and reimbursed for expenses in accordance with the attached fee schedule (See attached Fee Schedule – Exhibit C), which may be updated by the Transfer Agent from time to time.  Requests for payment of fees and expenses shall be submitted by the Transfer Agent in the form of a written invoice at the beginning of each month for the services to be provided for the prior month.  The Corporation shall make payment upon receipt of all invoices and all invoices shall be considered late if not paid in full by the last day of each month.  The Corporation shall pay interest at the rate of 0.83% per month for all late invoices.

h. The Transfer Agent will, at its own expense, maintain in full force and effect at all times during the term of this appointment insurance coverage in amounts with standard coverage and subject to deductibles as is customary for insurance typically maintained by similar transfer agents.

i. The Transfer Agent will not have any liability for failure to perform or delay in performing duties set forth herein if the failure or delay is due to an event of force majeure.  An event of force majeure is an event or condition beyond the Transfer Agent's control including, but not limited to acts of God, natural disaster, civil unrest, state of war, fire, power failure, equipment failure, act of terrorism, or similar events beyond the Transfer Agent's control.  The Transfer Agent will make reasonable efforts to minimize performance delays or disruptions in the event of such occurrences.

j. Nothing in the Agreement shall be construed to give any person or entity other than the Transfer Agent and the Corporation, and their successors and assigns, any legal or equitable right, remedy or claim under this Agreement.  The Agreement shall be for the sole and exclusive benefit of the Transfer Agent and the Corporation.

VII.CONSENT TO USE OF NAME AND LOGO

Each party may disclose in regulatory filings, marketing materials and in other communications the fact Transfer Agent has been appointed pursuant to this Agreement, however, neither party may disclose the specific terms of this Agreement including any fee information, without the prior written consent of the other party, unless disclosure of such fee information is required by SEC rules and regulations.

VIII.UNCLAIMED PROPERTY ADMINISTRATION

a. The Transfer Agent will provide unclaimed property reporting services for unclaimed certificates for the Securities and related cash dividends, which may be deemed abandoned or otherwise subject to applicable unclaimed property law or regulation.

b. The Corporation shall assist the Transfer Agent and provide such cooperation as may reasonably be necessary in the performance of the services hereunder including delivery to the Transfer Agent of any and all such unclaimed property which may not otherwise be in the Transfer Agent's possession.

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IX.LOST SECURITY HOLDER SEARCH SERVICES

a. Pursuant to SEC rules (See SEC Rule 240.17Ad-17, as amended), the Transfer Agent is required to provide certain services regarding lost security holder accounts for the Securities.

b. The Corporation agrees to reimburse the Transfer Agent for reasonable fees and expenses incurred by the Transfer Agent in the course of providing the referenced search services.  The referenced fees and expenses may be assessed periodically by the Transfer Agent in accordance with the services provided.  (See attached Fee Schedule – Exhibit C.)

X.CONFIDENTIAL INFORMATION

a. The Transfer Agent and Corporation acknowledge that during the course of the Agreement, the parties (the Discloser being the "Discloser" and the Recipient the "Recipient") may make confidential data available to each other or may otherwise have access to proprietary or confidential information regarding the Corporation, its stockholders, or the Transfer Agent, or its or their affiliates (collectively, "Confidential Data").  Confidential Data includes all information not generally known or used by others and which gives, or may give the possessor of such information an advantage over its competitors or which could cause Corporation or Transfer Agent injury, loss of reputation or goodwill if disclosed.  Such information includes, but is not necessarily limited to:  data or information that identifies past, current or potential customers, stockholders, business practices, financial results, fees, research, development, systems and plans; certain information and material identified by the Discloser as "Proprietary" or "Confidential"; data that the Transfer Agent furnishes to the Corporation from the Transfer Agent's database; data received from the Corporation and enhanced by the Transfer Agent; and/or data or information that the Recipient should reasonably be expected to know is confidential.  Confidential Data may be written, oral, recorded, or maintained on other forms of electronic media.  Because of the sensitive nature of the information that the Recipient and its employees or agents may obtain as a result of this Agreement, the intent of the parties is that these provisions be interpreted as broadly as possible to protect Confidential Data.  This Agreement, together with the exhibits and schedules referred to herein or delivered pursuant hereto, are Confidential and Proprietary, and shall be treated as Confidential Data by the parties hereto.   The Transfer Agent acknowledges that all Confidential Data furnished by Corporation is considered proprietary and strictly confidential.  The parties agree to maintain security measures to protect Confidential Data in its possession.

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b. The Recipient agrees to hold as confidential all Confidential Data it receives from the Discloser.  As between the Recipient and Discloser, ownership of Confidential Data shall remain with the Discloser, and Recipient shall not take any ownership interest in or right to use the Confidential Data unless expressly agreed in writing by the Discloser.  The Recipient will use at least the same care and discretion to avoid unauthorized use and disclosure of the Discloser's Confidential Data as it uses with its own similar information that it does not wish disclosed, but in no event less than a reasonable standard of care and no less than is required by law. The Recipient may only use and disclose Confidential Information of the Discloser only as necessary for the following "Permitted Purposes": (1) performing its obligations under this Agreement, (2) in the case of Corporation, deriving the reasonable and intended benefit from the services provided by Transfer Agent under this Agreement, and (3) as otherwise specifically permitted in writing by the Discloser in this Agreement or elsewhere.  The Recipient may disclose Confidential Data to: (i) its employees and employees of permitted subcontractors and affiliates who have a need to know; (ii) its attorneys and accountants as necessary in the ordinary course of its business; (iii) any regulatory authority, including the SEC and DTCC, and (iv) any other party with the Discloser's prior written consent.  Without limiting the foregoing, the parties further agree, subject to applicable law and regulations, that: (i) Confidential Data shall not be distributed, disclosed, or conveyed to any third party except by prior written approval of the Discloser; (ii) no copies or reproductions shall be made of any Confidential Data, except as needed to provide the services described in this Agreement; and (iii) the Recipient shall not use any Confidential Data for its own benefit or for the benefit of any third party.

c. The parties acknowledge that the unauthorized use or disclosure of any Confidential Data may cause irreparable harm to the Discloser.  Accordingly, the parties agree that the Discloser shall be entitled to equitable relief, including injunctive relief, in addition to all other remedies available at law for any threatened or actual breach of this Agreement or any threatened or actual unauthorized use or disclosure of Confidential Data.

d. Except as prohibited by applicable law or regulation, the Recipient shall promptly notify the Discloser in writing of any subpoena, summons or other legal process served on the Recipient for the purpose of obtaining Confidential Data (i) consisting of a stockholder list, such as an identified class of Corporation stockholders, or (ii) relating to significant regulatory action or litigation that would have a material effect on the performance of the Transfer Agent or corporate status of Corporation.  In such cases, the Discloser shall have a reasonable opportunity to seek appropriate protective measures; provided, however, that this subsection shall not require the Transfer Agent to notify the Corporation of its receipt of any subpoena, summons or other legal process seeking Confidential Data for a single stockholder or group of related stockholders in connection with routine tax levies or other routine third party litigation involving a stockholder.  The Discloser will indemnify the Recipient for all reasonable expenses incurred by the Recipient in connection with determining the lawful release of the Confidential Data that is subject to a subpoena, summons or other legal process.

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e. The obligations set forth in paragraphs (a) through (d) above shall not apply to:

(i) any disclosure specifically authorized in writing by the Discloser;

(ii) any disclosure required by applicable law or regulation, including pursuantto a court order; or

(iii)  Confidential Data which:

(1) has become public without violation of this Agreement; or

(2) was disclosed to the Recipient by a third party not under an obligation of confidentiality to the Discloser; or

(3) was independently developed by the Recipient not otherwise in violation or breach of this Agreement or any other obligation of the Recipient to the Discloser; or

(4) was rightfully known to the Recipient prior to entering into this Agreement.

f. The obligations of each party set forth in paragraphs (a) through (e) above shall survive termination or assignment of this Agreement.

XI.TERM

a. The Agreement shall have a term of three (3) years, which term shall automatically renew for successive three (3) year terms without any action unless either party shall provide written notice of cancellation thirty (30) days prior to the end of any applicable term period. In addition, either party may terminate the Agreement (i) at any time upon written notice if the terminating party has any reason to believe the other party or any of its officers, directors or affiliates may be involved, directly or indirectly, in potentially illegal conduct, and such notice shall state the basis for such termination, or (ii) upon thirty (30) days advance written notice that the other party is in material breach of its obligations hereunder, unless the breaching party has cured such breach within such thirty (30) day period.  Any notice of termination by the Corporation shall include a certified copy of a resolution of the Board of Directors of the Corporation related to such termination and payment for all amounts due and owing to the Transfer Agent. Note – although there is no specific termination fee, however, if the company terminates this Agreement upon a change of control in ownership, transfer of record fees will apply based on the number of shareholders at that time.

b. Upon the effective date of termination in accordance with the provisions noted above the Transfer Agent shall deliver, at the expense of the Corporation, to the Corporation, or to a successor transfer agent as directed in writing by the Corporation (and if no successor transfer agent has been identified at the time of resignation or removal, then the following shall be provided directly to the Corporation), all records of the Corporation in the possession of the Transfer Agent, with the exception of any blank stock certificates, as discussed in paragraph (a) above.

XII.NOTICES

All notices to be given by one party to the other under the Agreement shall be in writing and shall be sufficient if made to such party at their respective address.

If notice to the Corporation:  As set forth in the Certificate of Appointment.

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If notice to the Transfer Agent:

V Stock Transfer, LLC

Attn: Chief Executive Officer

18 Lafayette Place

Woodmere, New York 11598Facsimile:(646) 536-3179

All notices and communications hereunder shall be in writing and shall be deemed to have been duly given if mailed, by registered or certified mail, return receipt requested, or, if by other means, including facsimile capable of transmitting or creating a written record directly to the office of the recipient, when received by the recipient party at the address shown above, or at such other addresses as may hereafter be furnished to the parties by like notice.  Any such demand, notice or communication hereunder shall be deemed to have been received on the date received at the premises of the addressee (as evidenced, in the case of registered or certified mail, by the date noted on the return receipt, or in the case of facsimile, the date noted on the confirmation of such transmission).

XIII.GOVERNING LAW

The Agreement shall be construed, performed and enforced in accordance with, and governed by, the laws of the State of New York, without regard to the conflict of laws doctrine applied in such state.

XIV.AMENDMENT; ENTIRE AGREEMENT; SEVERABILITY

a. The Agreement may be amended or modified only by a written document authorized, executed and delivered by the Corporation and the Transfer Agent.  Such document may be in the form of a resolution of the Corporation adopting a written amendment approved by the Transfer Agent.

b. The Agreement, together with the exhibits and schedules referred to herein or delivered pursuant hereto, constitute the entire agreement and understanding of the parties with respect to the matters and transactions contemplated by this Agreement and supersede any prior agreement and understandings, including any fee proposals, with respect to those matters and transactions.  Each provision and agreement herein shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement.

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AGREED AND ACCEPTED:

VSTOCK TRANSFER, LLC

By: __________________________

      Name:

      Title:

Company Name:

_____________________________

By:  _________________________

      Name:

      Title:

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Exhibit A

LEGAL DOCUMENTATION CHECKLIST

Documents required to make VStock Transfer's appointment as transfer agent effective.

______ 1. A copy of the Certificate of Incorporation of the Corporation, together with all amendments, duly certified by the Secretary of State. Please also include the Bylaws of the Corporation and all amendments thereto.

______ 2. Preliminary Information Form (Exhibit B) of the Transfer Agent Services Agreement)

______ 3. Fully executed Certificate of Appointment  (Exhibit D).

______ 4. A list ( Exhibit E) of names, titles and specimen signatures of:

______ 5. A Reliance Letter (Exhibit F) signed by an authorized officer of the Corporation

______ 6. Provide status regarding DTC Eligibility and FAST listing (Exhibit G)

______ 7. Other agreements and documents as may be determined to be necessary.

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Exhibit B
PRELIMINARY INFORMATION FORM

TO BE FURNISHED TOVSTOCK TRANSFER, LLCIN CONNECTION WITH ITS APPOINTMENT AS TRANSFER AGENT AND REGISTRAR

1.	Name of Corporation:  _____________________________________________________________________
2.	Complete mailing address of Corporation: _____________________________________________________
	Phone and fax numbers of Corporation: _______________________________________________________
3.	Name and Address of Counsel  _________________________________________________
	__________________________________________________________________________
	Individual counsel contact  ______________________________________________________
	Phone and fax numbers of counsel contact
4.	Name, contact and phone number of stock certificate printer
	____________________________________________________________________________
5.	Number of stockholders: _____________ stockholders
6.	State of Incorporation of Corporation: ______________
7.	Corporation's Federal Taxpayer Identification Number:  __________________________________________
8.	Name and Address of individual to whom reports of transfers should be sent, as requested:
	___________________________________________________________________________
9.	Name and address of individual to whom invoices for fees and expenses should be sent:
	___________________________________________________________________________
10.	Previous Corporation names and effective dates of name changes
	____________________________________________________________________________
11.	Mergers/Acquisitions, effective dates and rates
	____________________________________________________________________________
12.	Record dates, distribution dates and rates for all stock splits/dividends, and/or
	cash dividends paid in past 12 months (if applicable):
	____________________________________________________________________________
	____________________________________________________________________________
	____________________________________________________________________________
13.	Nature of business	_____________________________________________________________

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Exhibit C

Services Included in Set-Up and

Ongoing Transfer and Registrar

Set Up

- Transfer of existing shareholder information from compatible electronic file, free of charge for Excel or compatible electronic file

- Establish secure, private issuer access to shareholder data

Stockholder Services

VStock Transfer is able to provide the following transfer agent and registrar services:

- Maintenance of stockholder accounts, including new accounts, account consolidation and escheatment

- Address changes

- Provide a dedicated account manager for stockholder and broker inquiries

- Prompt response to stockholder correspondence, email, and calls

- Provide storage of records in compliance with strictest SEC guidelines

- 24/7 electronic issuer access to stockholder information

- Unlimited on-demand reports, sorted according to issuer criteria

- Cost basis tracking, as required

- Maintenance of outstanding share records

- Prompt response to audit requests

- Regular compliance checks of stockholder accounts against Office of Foreign Assets Control Specially Designated Nationals list, as required by law

- Preliminary lost stockholder searches as required by SEC regulations

- Assistance to issuer with escheatment/abandoned property obligations

Our initial transfer set up fee will be $199 for shareholder data provided to us in in excel format. If data is provided in PDF or other format, additional data load fees may apply. We believe in doing things right at the set up stage to produce long term results. As such, we are confident that once we are able to solidify the data in our unique data base management system, both the company and the shareholders will benefit from having a reliable resource for all activity and reports going forward

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Monthly Maintenance Fee

Our monthly maintenance fee is calculated based upon the number of record shareholders per class or series of securities:

o Monthly Maintenance of 1-99 shareholders      $99 per month

o Monthly Maintenance of 100-200 shareholders$150 per month

o Monthly Maintenance of 200-300 shareholders$299 per month

o Monthly Maintenance of 300-500 shareholders$399 per month

o Monthly Maintenance of 500+      shareholders$749 per month

The following are a sample of services provided on a per transaction fee basis as set forth below:

o Cancel Cert                                         $10.00

o Issuance Per Cert                               $35.00

o Replacement of Lost or Stolen Cert$50.00 (paid by shareholder)

o Proxy Services                                                  Available upon request

o Proxy Printing                                                   Available upon request

o Audit verification                                $75.00

o Lost shareholder search (if needed)$5.00 per shareholder per search

o Escheatment (if needed)                    $50.00 per shareholder

Other Costs and Excluded Services

The company will be billed separately at cost for certain out-of-pocket expenses such as postage, courier fees, and an inventory of blank share certificates.

The above services and fees do not include services in connection with stock splits, reverse stock splits, and "deep search" and associated escheatment/lost property fees.  They do not include services for DWAC set-up ($499), maintenance ($150) issuances ($75) or transfer and does not include services for corporate actions, such as reorganizations, share exchanges, additional classes of stock or securities, conversions or redemptions of securities, exercises of warrants, tender offers or self-tenders, services for stock option plan or employee stock purchase plan administration, or proxy statements and annual meetings.  We would be happy to provide a quote for these additional services upon request.

15

Please complete the information below:

I ____________________________ authorize VStock Transfer, Inc. to charge my bank account

                    (full name)
indicated below on or after ___________________.

                                                               (date)

ID Information

ID Type ____________________________          Number ________________________

Country ____________________________                 State/Province ________________________

Billing Information

Billing Address  ____________________________Phone#  ________________________

City, State, Zip ____________________________Email  ________________________

Account Type:     CheckingSavings

Name on Acct_______________________________

Bank Name_______________________________

Account Number_______________________________

Bank Routing #_______________________________

Bank City/State   _______________________________

Credit Card Information

Card Type ________________________

_____________________________________________________________________                                                   ________________________

Credit Card Number                                     Expiration Date (xx/xx/xxxx)              CVV Code (*what's this?)

* Card Verification Value Code (CVV): CVV is a new authentication procedure established by credit card companies to further efforts towards reducing fraud for internet transactions. For Visa, MasterCard, and Discover cards, the card code is the last 3 digit number located on the back of your card on or above your signature line. For an American Express card, it is the 4 digits on the FRONT above the end of your card number.

As an authorized representative of the above mentioned company, I hereby authorize VStock Transfer, LLC  to maintain the above referenced credit card on file and to use such card for each transaction with VStock Transfer on behalf of the above referenced company unless otherwise instructed by the card holder.

________________________________________________                                                                       ________________________

  Signature                                                     Print Name                                            Date

16

Exhibit D

CERTIFICATE OF APPOINTMENT

OF VSTOCK TRANSFER, LLC AS

TRANSFER AGENT AND REGISTRAR

By _____________________a _____________ corporation (the "Company"),

=====================================================================

WHEREAS, the Company is authorized to issue the following securities (the "Securities"):

Class of Securities CUSIP Par Value or Exercise Price No. Securities Authorized

WHEREAS, the Securities outstanding on the date of this Certificate and issued after the date of this Certificate (a) are duly authorized, validly issued, fully paid and non-assessable and any preemptive and other contractual rights related to all issuances of the Securities have been satisfied, and (b) have been registered under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, or are exempt from registration.  All issuances and transfers of Securities have been, and after the date of this Certificate will be, in compliance with all applicable laws, rules and regulations and all certificates evidencing the Securities shall bear all required legends.

NOW THEREFORE, I, the undersigned, do hereby certify that I am the duly elected, qualified and acting ________________  of _______________________, a corporation organized and existing under the laws of the State of ________; that (i) approval by the Board of Directors is not necessary for the appointment of VStock Transfer, LLC as the Transfer Agent and Registrar, or (ii) the following is a true copy of a resolution adopted by the Board of Directors of said Corporation at a meeting duly held on ___________, 20__ at which a quorum was present and voted, or by unanimous written consent effective as of such date, that said resolution is now in full force and effect, and shall remain in full force and effect until altered by subsequent Board resolution:

RESOLVED, that VSTOCK TRANSFER, LLC, its successors and assigns, is hereby appointed Transfer Agent and Registrar (the "Transfer Agent") effective ____________, 2014 (the "Effective Date of Appointment"), to act in accordance with its general practices, for the transfer and registration of securities.

WITNESS my authorized signature as _____________ of the Corporation this ___________ day of _______________, 2016.

Signature:  _____________________

Title: _________________________

17

Exhibit E

LIST OF AUTHORIZED INDIVIDUALS

The following is our list of authorized contacts and their level of authority with VStock Transfer, LLC.

AUTHORIZED CONTACTS (Complete all sections, print out form, check authorization boxes and obtain signatures.)
Individual's Name
Title
Phone Number
E-mail
Signature	X	X	X

NAMES OF OFFICERS THAT ARE AUTHRIZED TO SIGN STOCK CERTIFICATES:

1._______________________________

2.______________________________  

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Exhibit F
RELIANCE LETTER

__________, 20___

V Stock Transfer, LLC

Attn: Chief Executive Officer

18 Lafayette Place

Woodmere, New York 11598

Dear Sirs:

VStock Transfer, LLC ("VStock Transfer"), can rely on the stockholder records for _______________________ (the "Company") provided by the Company to VStock Transfer (the "Stock Ledger").  The Stock Ledger is a complete and accurate listing of all outstanding securities of the Company's. Except as indicated in the Stock Ledger, there are no (i) stop transfer orders (e.g., lost certificates or adverse claims), (ii) court order or other document that affects the transfer and/or registrar of the Securities, and (iii) transfer restrictions in effect against any outstanding shares.

Thank you in advance for your assistance.

Sincerely,
By:	__________________________
Name:	__________________________
Title:	__________________________

19

EXHIBIT G

ARE THE SHARES OF YOUR COMPANY CURRENTLY DTC ELIGILBE:

___  YES

___  NO

ARE YOUR SHARES APPROVED WITH FAST  FOR ELECTRONIC TRADING (DWAC)?

___  YES

___  NO

20

Sample of our print on demand certificate below:

21

STOCK CERTIFICATE ORDER FORM

Exhibit A

Company: _________________________________________

Name of Signatory: __________________________________

Title: _____________________________________________

A specimen of your signature is required to reproduce. Please provide your signature

below, using black ink, in the windows provided.

22

EX1A-15 ADD EXHB