How We Review Issuers

How We Screen (And Don’t Screen) Issuers

Under regulations issued by the SEC, we are required to:

We will comply with all those requirements. But – and this is very important – we are not required to conclude that Issuers on our Platform represent good investments for investors. In fact, we are not even allowed to tell you if we think that one Issuer is a better investment than another Issuer. You have to make those decisions on your own.

Disqualification of Issuers

Title III may not be used if the Issuer or certain other people have been the subject of certain disqualifying events during the last 10 years.

The “certain other people” are:

The “certain disqualifying events” include a long list of events, all involving improper actions in the securities business – for example, the conviction of a felony or misdemeanor in connection with the purchase or sale of any security, or the loss of license of a securities broker for misconduct. As explained above, we will conduct background checks before allowing an Issuer to list on our Platform.

The Kinds of Securities We Will Offer

We expect that the Issuers on our Platform will be Delaware limited liability companies (“LLCs”) and that Investors will purchase equity shares, which are called limited liability company interests. Ownership of a limited liability company interest gives an Investor the right to share in the profits of the LLC, but typically will not give the Investor any right to vote or otherwise participate in management.

Each LLC will own the right to receive an income stream from the artist’s music. What kind of income stream and for which music will be described in the offering materials. As one possible example, an artist might grant to her LLC the right to receive all the streaming income (income from music streaming services like Spotify) from six of her songs for three years. An Investor might buy a limited liability company interest representing 4% of all the interests in the LLC. As a result, the Investor would have the right to receive distributions from the LLC based on 4% of the streaming income.