Head to our website! Opportunity Zones Facts and Figures (July 2019)

1. What You Need to Know about Opportunity Zones and Operating BusinessesfeaturingKorb Maxwell, PolsinelliBrian Phillips, The Pearl FundAnne Driscoll, Launch PadChris Schultz, Launch Pad Opportunity Zones Webinar SeriesSeptember 24, 2019 The material and information provided is for informational purposes only. It does not constitute an offer to sell or a solicitation of an offer to buy any interests in an opportunity fund or any other securities. Any such offering will be made only in accordance with the terms and conditions set forth in a definitive agreement and will be made in reliance upon an exemption from registration under the United States Securities Act of 1933, as amended.

2. Updates from the Economic Innovation Group • Head to our website!   • Opportunity Zones Facts and Figures (July 2019) • Opportunity Zones State Fact Sheets • Why is San Jose Growing While Cleveland Shrinks? Maybe It’s Immigration and Not the Weather • From Managing Decline to Building the Future - Could a Heartland Visa Help Struggling Regions? • EIG’s Opportunity Zones Webinar Series • Erie, PA: A City Comes Together to Unlock its Potential – watch the webinar • Strategies for Community-led Investment in Rural and Tribal Opportunity Zones – watch the webinar • An Overview of the Second Round of Proposed Regulations – watch the webinar • Field Update Featuring Opportunity Alabama and The Opportunity Exchange – watch the webinar • What Local Government Officials Should Know about Opportunity Zones – watch the webinar September 2019

3. Key Issues for Operating Businesses Addressed in the Second Round of Proposed Regulations • Gross Income Test: • The first tranche of proposed regulations included a requirement that 50 percent of the gross income of the Qualified Opportunity Zone (QOZ) Business be derived from the active conduct of a trade or business in the QOZ. • The proposed regulations retain this requirement but adopt three safe harbors and a facts and circumstances test. • Interim Gains:  • Congress intended to link the tax benefit to the duration of a taxpayer’s investment in a Qualified Opportunity Fund (QOF), not to the duration of a QOF’s investment in any specific asset/business. • The proposed regulations provide that proceeds received by the QOF from the sale or disposition of QOZ Business Property are treated as QOZ Property for purposes of the 90-percent asset test, so long as the QOF reinvests the proceeds within 12 months. The rules clarify that sales of assets by QOFs do not impact an investor’s holding period in the QOF. • Substantial Improvement Test for Operating Businesses:  • The preamble states that the substantial improvement requirement is applied on an asset-by-asset basis, which will be especially cumbersome and complex for operating businesses. • In order to facilitate investments into existing businesses as intended by Congress, QOZ Businesses should be allowed to elect to treat all of the tangible property of a trade or business as a single property for purposes of the substantial improvement test. • Read a full analysis from EIG September 2019

4. Actions to Build an Ecosystem for Businesses Investment • White House Opportunity and Revitalization Council • Economic Development Administration expands area of eligibility to include Opportunity Zones • Department of Commerce RFI – active (October 18 deadline) • 160+ actions taken to align federal resources with Opportunity Zones – full list (August 2019) • State Legislation and Action • West Virginia – 10 year elimination of state income taxes for QOZBs • Maryland – alignment of resources, offers refundable tax credits for businesses with workforce training, etc. • Michigan – departments encouraged to purchase items and services needed by state agencies from OZs • Washington, D.C. - On the Job Training Opportunities reimbursed by DOES up to 75% of wages for 6 months per trainee, RFI on ways to support small commercial space users in securing affordable commercial space, etc. • Comprehensive list of state legislation on Novogradac’s website • Local Opportunity Zone Investment Prospectus and Investor Summits • Kansas City, Missouri Investor Summit – Accelerator for America (more information) • Minnesota’s Be Inspired Summit – Minnesota Opportunity Collaborative (more information) • More than 30 cities have created an Opportunity Zones Investment Prospectus September 2019

5. Across the Nation: Investments in Operating Businesses • Multi-Investment Opportunity Funds • Secure Accelerator Fund Erie - $10 million fund launched by Erie Innovation District and CapZone Impact Investments to invest early-stage equity in Erie’s IT and cyber-security startups. • Crop One Holdings - Fund to support vertical farming producers in Austin-San Antonio corridor, increasing food access and expanding opportunities for local businesses. • DelCam Opportunity Zone Fund 1 - $10 million fund managed by DelCam Holdings to acquire and revitalize small manufacturing companies in the Northeast and Mid-Atlantic. • Hall Opportunity Fund I -Growth capital fund managed by Hall Venture Partners provides strategic resources to early stage tech and science companies identified through Hall Labs Incubation in Provo, UT. • Operating Businesses • Proximity -Co-working platform based in rural CO leverages OZ investment to advance expansion plan. • Benton Enterprises – Owner of Heart Ridge Farms in Madera County, CA is raising investment to expand innovative technology for processing and to build a new facility for pasteurization research. • SHINE Medical Technologies – Development-stage medical company committed to social responsibility is raising $30 million for which OZ equity is eligible. Located in Janesville, WI, SHINEis dedicated to being the world leader in the safe, clean, affordable production of medical tracers and cancer treatment elements. September 2019

6. Across the Nation: Intermediaries Focused on Businesses “We cannot afford to attach our future to the fate of one industry or a handful of factories… Our strategy is rooted in building the businesses and jobs of tomorrow. Thanks to a new federal policy called Opportunity Zones, which incentivizes private investment in the kind of bottom-up economic growth our community needs, we're beginning to re-establish Warren as a city of modern methods.” - Rick Stockburger and Sara Daugherty Tech Belt Energy Innovation Center / Warren, OH “Our team believes that the returning citizen entrepreneurs in our accelerator embody the exact target demographic the Opportunity Zone legislation is designed to capitalize. These four amazing leaders are making a difference in their communities through successful enterprises, and have often been overlooked by capital sources that other founders take for granted. This is a missed opportunity for everyone.” - Sara Gibson and Tom Bartlett, 20 Degrees OZ Justice Accelerator / Washington, D.C. “Minority entrepreneurship is on the footstep of new opportunity in our city – and we need to open up that door together.” - Della Clark The Enterprise Center / Philadelphia PA “Our teams across the U.S. are actively pursuing Opportunity Zone revitalization efforts, and this partnership with Rockefeller will do more to bring about the responsible growth we want to see in these communities.” - Maurice Jones LISC / National September 2019

7. Polsinelli is an Am Law 100 firm with more than 875 attorneys in 21 offices nationwide. Utilizing our experience with federal, state, and local development incentives, as well as tax credit programs, we assist clients in structuring deals with economically-favorable terms since the program’s inception and continue to support clients in navigating the evolving regulations. Currently, we have closed deals valued at more than $1.5 billion. • Our attorneys offer clients many insights that optimize the full extent of the Opportunity Zones program, including: • Identifying unique deal structures • Opportunity Zone fund formations • Structuring real estate and operating business investments • Tax planning, advice and compliance “Working with the Polsinelli Opportunity Zone team, I have been extremely impressed by the depth of their understanding of the program and their focus on making it work for my deals.” Polsinelli Client • Polsinelli’s experienced attorney team has studied the Opportunity Zones program from when it was signed into law, and is actively helping our clients navigate these new regulations. To support this growth, we now have 30 attorneys in the Opportunity Zones group. September 2019

8. The Polsinelli Opportunity Zones team’s experience includes, but is not limited to the following: • OZ Transactions in Real Estate • Represent client in a $300 million Qualified Opportunity Zone transaction to development multi-family, retail and office space in Tampa, Florida. • Represent a developer in a $200 million Qualified Opportunity Zone transaction for mixed-use, residential and commercial development in Salt Lake City, Utah. • Represent a developer in an $80 million Qualified Opportunity Zone transaction for the development of 13 properties in the Kansas City metropolitan area. • Represent client in a $70 million Qualified Opportunity Zone transaction to develop mixed-use residential and retail space in Cleveland, Ohio. • Represent a developer in a $60 million Qualified Opportunity Zone transaction for mixed-use, residential and HUD development in the Salt Lake City metropolitan area. • Represent client in a $40 million Qualified Opportunity Zone transaction for senior housing development in rural Colorado. • Represent a developer in a $33 million Qualified Opportunity Zone transaction for residential development in Indianapolis, Indiana. • Multi-Asset Investment Vehicle • Advise on the fund formation and tax structuring of a $300 million Opportunity Zone Fund focused on real estate investment across a national geographic coverage. • Advise on the fund formation and tax structuring of a $100 million Opportunity Zone Fund focused on supporting a mixed-use community including multi-family, residential, hotel, commercial and retail space in Colorado. • Advise on the fund formation and tax structuring of a $50 million Opportunity Zone Fund focused on supporting renewable energy projects. • Advise on the fund formation and tax structuring of a $25 million Venture Capital Fund focused on deploying capital in Qualified Opportunity Zone Businesses. • Advise on the fund formation and tax structuring of a $20 million Opportunity Zone Fund focused on the acquisition of real estate. • OZ Transactions in • Operating Companies • Represent client in making a Qualified Opportunity Zone investment in an operating company located in Texas with a valuation of $40 million. • Represent client in making a $25 million Qualified Opportunity Zone investment in early-stage startups in New York and Pennsylvania. • Represent client in making a $10 million Qualified Opportunity Zone investment in an operating company located in Pennsylvania. • Represent client in making a Qualified Opportunity Zone investment in an operating company located in Kansas with a valuation of $1.6 million. • Represent client in a Qualified Opportunity Zone transaction to purchase their headquarters and distribution center in the Kansas City metropolitan area. • HNWI / Family Office Advising • Advise 20+ high-net-worth individuals and Family Offices on fund formation, capital placement and ongoing investment activity and growth in designated opportunity zones. September 2019

9. Standard Deal Structure – Operating Company or Real Estate Fund Investors - Non managing members - Sponsor QOZ $$ QOZ $$ JV Partner Can be another OZ fund or fresh equity QOF I, LLC [DE- LLC] - managing member - Potential Fees to Affiliated Sponsor: • Development Fee: [__]% of total project cost. • Acquisition Fee: [__]% of Property Purchase Price. • Property Management Fee: Mkt. terms. • Asset Management Fee: [__]% of collected gross revenue. • Finance Fee: [__]% of aggregate indebtedness. Potential Lender QOZB, LLC [DE – LLC] QOZB Property September 2019

10. Sample Structure of Forming Own Fund Individual/ Entrepreneur with gain Your C or S Corp Your QOF, LLC [DE- LLC] - managing member - 1% 99% Potential Lender Your QOZB, LLC QOZB Property September 2019

11. Making Opportunity Zones Work for Operating Businesses OZ Investors QOZ $$ Service Provider/ Idea Person OZ Fund QOZB QOZB Property • Capital gain investors form and invest in OZ Fund. • OZ Fund invests into the underlying QOZ Business (service providers can contribute capital gain funds or simply get a profits interest). • QOZ Business is set up within an Opportunity Zone, focusing on meeting the 70% tangible asset test. • The QOZ Business then creates and develops the new idea/product/intellectual property. September 2019

12. Making Opportunity Zones Work for ABC, LLC Existing Equity Remains in Place Current ABC Investors New Investors QOZ $$ QOZ $$ Existing Interest ABC OZ Fund $ Good Asset Store ABC, LLC QOZB Qualifying Assets IP & Tangible Property • Substantially all (70%) of the Opportunity Zone Business’ tangible assets must be “good assets”. Thus, existing ABC, LLC uses a portion of the new equity investment to acquire enough qualifying tangible assets to meet the 70% test and to lease space in an OZ. • The existing equity will not directly get the benefits of the OZ Program, although ideally might be able to obtain a premium for being an OZ eligible investment for the new investors. • Existing investors could invest capital gains from other investments through the OZ Fund and would obtain OZ benefits for this portion of their investment – consider structuring with better returns to capture more of the upside with this equity. • Existing tangible assets may qualify if bought after 2017, currently used outside of the OZ and brought into the OZ. If ABC LLC is currently located in an OZ, may require some expansion (70% new assets to meet test). September 2019

13. Making Opportunity Zones Work For ABC, LLC Full Opportunity Zone Treatment – • More than 20% related Current ABC Investors Current ABC Investors ABC, LLC is an early stage company and its assets are mostly IP. Current ABC Investors organize NewCo in an OZ and transfer the business without new investors. $ $ $ OZ Fund ABC, LLC $ NewCo, LLC QOZB IP IP & Tangible Property • If it can reasonably be stated that the existing value of the IP (or other assets purchased by NewCo) is relatively low (or not significantly in excess of basis), then the current ABC, LLC could sell the IP for a small amount of gain (taxable). This gain would be ineligible for OZ treatment, but if the current owners have other capital gains they could invest, they can convert the existing structure into an OZ structure for a relatively nominal toll charge (the tax on the sale of the IP or other assets). • NewCo will likely have to purchase or lease additional tangible assets which, along with the leased office space in the OZ, will help satisfy the 70% test. September 2019

14. Making Opportunity Zones Work For ABC, LLC Full Opportunity Zone Treatment – • Less than 20% related New Investors Current ABC Investors ABC, LLC or its assets are purchased by an unrelated company—NewCo, LLC. ABC, LLC is not located in an OZ. QOZ $$ ABC Gain $ $ OZ Fund NewCo OZ Fund $ 80% $ 20% $ ABC, LLC NewCo, LLC QOZB IP IP & Tangible Property • When NewCo purchases ABC, LLC assets or interests and brings the tangible assets into the OZ, these will be qualified property, helping to satisfy the 70% test. This will affect timing of investments by current ABC investors. • If the existing owners of ABC, LLC, in the aggregate, will not own more than 20% of NewCo, then they could invest gains from the sale of ABC interests right back into NewCo through an OZ Fund (or ABC, LLC can) and the Current Owners could get full OZ benefits for the investment in NewCo (including deferral of tax on the gain). If assets are sold, there will be a timing issue. • If ABC, LLC already is located in the same OZ as NewCo, may have to expand to meet the 70% test September 2019

15. Tax Exempt Organization Healthcare 501(c)(4) Tax Exempt Entity Community Capital Fund 501(c)(3) Tax Exempt Entity 1% 99% services Healthcare QOF Manager LLC Outside Investors Managing Director ___% ___% Healthcare QOF, LLC Qualified Opportunity Fund 1% 99% Healthcare QOZB, LLC Qualified Opportunity Zone Business • Key Considerations • Multiple Assets with Single QOF: Proposed Regulations issued April 17, 2019 permit QOF investors to realize the 10 Year Benefit when the QOF sells its interests (the QOZB). Thus, the Healthcare QOF can own numerous QOZBs. • Promote: There are potential Tax Exempt issues with the Managing Director getting a typical promote from Healthcare QOF Manager LLC. The current plan is that the Managing Director would receive a fixed salary coupled with a bonus structure that is subject to an overall reasonable compensation cap, as determined by the Healthcare QOF Manager LLC compensation committee. • Healthcare ownership of QOZBs: Each QOZB needs to be taxed as a partnership or as a corporation. Healthcare can cause each QOZB to be a partnership with a small interest. Alternatively, any non-capital gain members could be direct members of the QOZB or the manager could get its promote directly from the QOZB (subject to discussion in “Promote” item, above). September 2019

16. What? • We were the first Venture Capital Fund that is a Qualified Opportunity Zone Fund • Our focus is on high-potential (10x+) early-stage startups launched or relocated into OZs near us (Scranton, NYC, + CT, NJ, PA, NY) • Expect higher returns and greater impact than real-estate OZ Funds September 2019

17. Why? • The potential of tax-mitigated returns of a successful startup is unprecedented • The outcome will generate the “right kind” impact on the communities naturally • Proven/field-tested in emerging markets over the last two decades • We are ideally suited for OZ + early-stage venture • 6 exits in startups + economic SME development via entrepreneurship in Africa, China, India and Latin America September 2019

18. How? • Focus on our expertise • Small fund (<$20M), mostly tech & mostly local • Number of Investments: ~15-20 • Multiple gated investment windows every 30 to 60 days • Leverage existing incubator pipelines • Real-estate only if needed for the businesses September 2019

19. Impact: • Job creation • Local spending • Metrics built into OZB investments • Annual roll up reporting (Beek ++) • OZB association roll up reporting? September 2019

20. Impact + (Multiple OZB/Pearl-like Funds) • Why: • Multiple requests for help • The barrier to entry is high + late start + slow capital raising • Limited impact / limited resources • Big guys are not jumping in • OZ real-estate + OZB potential September 2019

21. Impact + (Multiple “Pearl” Funds): • How: • Association • Collaboration & best practices • Co-investment • Co-launching funds September 2019

22. Issues: • High barrier to entry (multi-asset) • Small funds = Low GP income • Slow capital raising • 10 year hold September 2019

23. The Problem September 2019

24. Our Solution - Coworking + + Driving results in 3 ways: • Profitable coworking business • Venture returns by investing across markets • Economic impact through job & wealth creation Open Launch Pad locations in Opportunity Zones in “momentum markets” around the country. Invest in people “working entrepreneurially” to create their own jobs and build high-growth companies. September 2019

25. The Headlines September 2019

26. The (Current) Perception • “I thought it was just something for developers to take advantage of in our city” • “Another program leading to displacement of indigenous Newark population” • “Too confusing...” September 2019

27. It’s just the first inning... • Real estate is happening, but real estate investors struggle with operating companies • Traditional VC ain’t coming, because it’s complex & not usually looking for tax advantage • We believe impact investors’ role to kickstart & write checks… now September 2019

28. Raising capital as a QOZB is just one arrow in your quiver • QSBS exemption • SBIC • USDA • Grants.gov +100s more • MBDA • SBA 8(a) September 2019

29. Raising as a QOZB is not right for all businesses QOZB September 2019

30. Finding the right Opportunity Fund Investor is hard Impact Investors - We care about impact in OZs Real Estate Investors - We know buildings need tenants QOZB Venture Investors - We understand investing in operating co’s September 2019

31. A Multi-Asset Fund is critical for Operating Businesses September 2019

32. Can I raise capital as a QOZB? i. At least 50 percent of the services performed (based on hours) for such business by its employees and independent contractors (and by the employees of independent contractors) are performed within the QOZ, or ii. At least 50 percent of the services performed for the business by its employees and independent contractors (and by the employees of independent contractors) are performed in the QOZ, based on amounts paid by the business to the employees and/or independent contractors for the services performed, or iii. the combination of the tangible property of the business that is located in a QOZ and the management or operational functions performed for the business in the QOZ are each necessary to generate 50% of the gross income of the trade or business. September 2019

33. Our experience raising capital as a QOZB • There’s a lot of hesitancy surrounding the operating business side of the OZ program, but don’t let that deter you: • Typical start-up founders and venture investors are not used to having tax breaks at their disposal, but the program is designed to work for us too • If you’re based in an OZ and focused on growing a business, then you likely qualify • Most recent round of regulations did their best to lower QOZB thresholds • Mayors and community leaders across the US want to see QOZB growth and are eager to help you succeed in their city • Don’t significantly alter your business strategy just to qualify for QOF investment • The tax advantages around OZ qualification are not dramatic enough to outweigh a bad business decision • OZ incentives are a great overlay to an already compelling investment opportunity and can lower your cost of capital September 2019

34. What we’ve learned in the process • Fundraising as a QOZB doesn’t mean you’re forced to only take on OZ capital • View OZ capital as an extra avenue to offer potential investors and expand your investor network, but not a constraint - in our seed round, we took on both OZ and non-OZ capital, separated in our cap table • Get ready to talk to investors who don’t traditionally invest in your space; be open to approaching potential investors who don’t fit your typical profile • The timing aspect can be difficult to navigate • Given the 180 day deployment rule for QOFs, one investor may be on a very different timeline from another - that can create tension in your fundraising process • Don’t do this alone - there is a growing marketplace of resources who want this to work for your QOZB • This is a collaborative effort - others looking at OZ as a business or an investor are willing to share and help September 2019

35. Getting prepped ahead of your QOZB round • Envision potential use of OZ funds and clarify with your accounting partner • Prepare a high-level written plan for how you plan to use the capital • Once a QOZB receives OZ capital, there’s a 31-month safe harbor to put that capital to use as long as you have a compliant written plan for its use • Have your ducks in a row before you engage investors: start with the standard QOZB checklist • Compile QOZB compliance documentation (most of which you probably have on hand) • Prepare an OZ-specific term sheet with your legal counsel • In our seed round, we had two term sheets for investors - one for OZ and one for non-OZ • Be open to demonstrating the risk of investing in a QOZB (such as your business potentially failing to comply as a QOZB if things change down the road) • Don’t assume investors understand all of the aspects of the law - button up your QOZB plan with accounting partners beforehand to be ready to answer investor questions September 2019

36. Control your resources • Fit the prep/accounting/legal costs into your overall budget • Our QOZB prep work cost us ~$10k in accounting and legal fees • Again - there is a growing OZ community and you can find early/basic strategic resources to help determine your best path forward • Align with investors who believe in your business (and its location) • The OZ investor marketplace is just as new to this benefit as the business owner • Place matters - this is a place-based investor benefit, so find investors who want you to succeed where you want your business to grow • Timing matters • Investors are on the clock. Make sure your fundraising timeline aligns with your investors’ deployment and exit timelines September 2019

37. We’re the opportunity in Opportunity Zones The Opportunity Zones program directly aligns with Launch Pad’s strategy and incentivizes greater investment potential, through both the real estate and resultant venture opportunities. Contact Information Email:expansion@lp.co Website: http://lp.co/expansion/ Twitter: @launchpad Instagram: @launch.pad.nation @launchpadnola @launchpadnewark @launchpadnashville @launchpadmemphis @launchpadsanantonio September 2019

38. Q & A The material and information provided is for informational purposes only. It does not constitute an offer to sell or a solicitation of an offer to buy any interests in an opportunity fund or any other securities. Any such offering will be made only in accordance with the terms and conditions set forth in a definitive agreement and will be made in reliance upon an exemption from registration under the United States Securities Act of 1933, as amended. September 2019

39. EIG’s Opportunity Zones Coalition The Opportunity Zones Coalition is a group of organizations working together with a broad array of public and private stakeholders to ensure the timely and effective implementation of the policy.  If you are interested in learning more about the Opportunity Zones Coalition, please contact info@eig.org. September 2019