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How New Secondary Markets Are Helping Pre-IPO Shareholders Cash Out
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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents the PEC tokens, as described in The Elephant's White Paper have not been registered under any securities laws in any jurisdiction (together with the Act, the “Securities Laws”), but rather are being and will be allocated by The Elephant pursuant to exemptions from registration under the Securities Laws.

Accordingly, the undersigned gives the following representations and warranties:

• It has the knowledge and experience in financial and business matters required to receive and use the PECs and/or services to be made available by THE ELEPHANT, as described in the White Paper, as amended from time to time, and as such it is capable of evaluating the merits and risks involved with them.

• The purpose of this declaration is to enable THE ELEPHANT and its affiliates to discharge its responsibilities under such exemptions and that THE ELEPHANT will rely upon the information contained herein, and therefore, the representations herein are complete, accurate and binding, and may be relied upon by THE ELEPHANT and its affiliates.

• Although THE ELEPHANT will use their best efforts to keep this letter strictly confidential, they may present this declaration and any other information which the undersigned has provided to them to such parties as they deem advisable if called upon to establish the availability under the Securities Laws of an exemption from registration of the offer and sale of the PEC or any other service to be made available by THE ELEPHANT, as described in the White Paper, as amended from time to time, or if the contents thereof are relevant to any issue in any action, suit or proceeding to which THE ELEPHANT or its affiliates is a party or by which they or it are or may be bound.

• Any offer or services that may be made available to the undersigned by THE ELEPHANT or its affiliates (i) will not constitute a violation of any laws or regulations, including the Securities Laws and investment advice laws, of any applicable jurisdiction; (ii) will be permissible under all applicable Securities Laws and shall not trigger any licensing, registration, or other requirements.

• It shall not transmit or otherwise send any information to which THE ELEPHANT will give it access to, to any person in any jurisdiction in which the distribution of such information and/or the offering or services to be offered by PEC are not authorized, or to whom such offer or invitation may be unlawful.

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1. Any fiat currency used by the undersigned in connection with the offering and services to be made available by The Elephant, as described in its White Paper and associated commercial terms, as changed from time to time, is legally owned by the undersigned and not raised from any other parties.

2. In respect of the transaction made in connection with these offering and services, it has not obtained any access to the relevant transaction information in a press release, conference, advertisement, announcement, professional or trade publication or marketing materials within the People’s Republic of China.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it has made appropriate enquiries and has full knowledge of the nature, rights and obligations arising out of the offering or the services made available by The Elephant, as described in its White Paper and associated commercial terms, as changed from time to time, and obligations applicable to it under the laws of the Arab Republic of Egypt, and will not make any offerings, disposals, investments or otherwise transact with regard to offering or the services made available by The Elephant in case such offering, disposal, investment or other transaction is in contravention to the laws, regulations, governmental circulars and decrees of the Arab Republic of Egypt.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is located or resident in the European Economic Area (the “EEA”), it is a “qualified investor” within the meaning of the law in any member state of the EEA which has implemented the Directive 2003/71/EC, and amendments thereto, including Directive 2010/73/EC (the “Prospectus Directive”), implementing Article 2(1)(e)(i), (ii) or (iii) of the Prospectus Directive.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is a “qualified investor” within the meaning of Directive 2003/71/EC, as amended, and it professionally or commercially purchases or sells securities or investment products (Vermögensanlagen) within the meaning of the German Investment Product Act (Vermögensanlagengesetz) for its own account or for the account of others.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is a “qualified investor” as such term is defined in the Prospectuses Act 2005 of Gibraltar (as amended) and in Directive 2003/71/EC. It is a “professional client” as such term is defined in the Financial Services (Markets in Financial Instruments) Act 2006 of Gibraltar; and that it has not requested “non-professional treatment” within the meaning of Schedule 2 of the Financial Services (Markets in Financial Instruments) Act 2006 of Gibraltar.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is a professional investor (as such term is defined in Part 1 of Schedule 1 to the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong)).

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is:

1. An Investor to which at least one of the categories set forth in the First Addendum to the Israeli Securities Law, 1968 (the "Securities Law") and as listed below apply (a "Sophisticated Investor"); and

2. aware of the implications of being a Sophisticated Investor, and agree thereto.

The categories are:

1. A Joint Investment Trust Fund, as such term is defined in the Joint Investments Trust Law, 1994, or a management company of such a fund;

2. A Provident Fund or a Management Company as such terms are defined in the Control of Financial Services Law (Provident Funds), 2005;

3. An Insurer, as defined in the Insurance Supervision Law, 1981;

4. A Banking Corporation or an Auxiliary Corporation, as such terms are defined in the Banking (Licensing) Law, 1981, other than a joint services company, acquiring for their own account or for the account of clients which are investors who fall within the categories listed in Section 15A(b) of the Securities Law;

5. A Portfolio Manager, as such term is defined in Section 8(b) of the Regulation of Investment Advice, Investment Marketing and Portfolio Management Law, 1995 (the "Investment Advice Law"), acquiring for its own account or for the account of clients which are investors who fall within the categories listed in Section 15A(b) of the Securities Law;

6. An Investment Adviser or an Investment Marketer, as such terms are defined in Section 7(c) of the Investment Advice Law, acquiring for its own account;

7. A member of the Tel Aviv Stock Exchange acquiring for its own account or for the accounts of clients which are investors who fall within the categories listed in Section 15A(b) of the Securities Law;

8. An Underwriter, as such term is defined in section 1 of the Securities Law, that meets the qualifying conditions according to Section 56(c) of the Securities Law, acquiring for its own account;

9. A Venture Capital Fund; for this purpose, a “Venture Capital Fund” means a body corporate the main activity of which is investment in bodies corporate whose main activity, at the time of the investment, is research and development or the production of innovative and knowhow intensive products or processes, investment in which involves greater risk than what is customary in other investments;

10. A body corporate wholly owned by investors that fall within the categories listed in section 15A(b) of the Securities Law;

11. A body corporate, other than a body corporate incorporated for the acquisition of securities from a certain offer, with an equity capital in excess of NIS 50 million;

12. An individual, investing for his or her own account:

a. The total value of his or her Liquid Assets exceeds NIS 8 million;

b. His or her annual income in each of the previous two years exceeds NIS 1.2 million, or 1.8 million for a Family Unit; or

c. The total value of his/her Liquid Assets exceeds NIS 5 million and his/her annual income in each of the previous two years exceeds NIS 600,000 for an individual, or NIS 900,000 for a Family Unit.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is a “wholesale investor” as that term is defined in clauses 3(2)(a), (c) or (d) of Schedule 1 to the Financial Markets Conduct Act 2013 of New Zealand (“FMC Act”), being a person who is

☐ an “investment business”;

☐ “large”; or

☐ a “government agency”,

in each case as defined in Schedule 1 to the FMC Act.

2. The undersigned understands the consequences of certifying itself to be a wholesale investor.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is an “institutional investor” as defined under the Decree-Law 1 of 1999 and Accord 1 of 2001, both as amended, in relation to whom the registration of the securities to be offered and sold is not required. Pursuant to the foregoing, the undersigned (i) is a legal entity, validly formed and in existence, (ii) has participated, on a regular basis, in at least the previous two years, in the administration of investments substantially similar to those described in The Elephant White Paper, (iii) has a net worth of at least one million dollars, (iv) has key executives or, a majority of its directors and officers, that have at least two years of experience in the regular administration of investments and (v) does not require the protection of the provisions set forth in the securities laws of the Republic of Panama.

The undersigned acknowledges that the securities have not been registered under the Panamanian securities laws and regulations and may not be offered or sold within Panama except pursuant to an exemption from, or in transactions not subject to, the registration requirements of the Panamanian securities laws and regulations.

PLEASE NOTE EXTERNAL CONFIRMATION AND/OR EVIDENCE MAY BE REQUIRED BEFORE THE ACCREDITAION PROCESS IS COMPLETED

By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is a “qualified investor” within the meaning of the Federal Law of the Russian Federation “On Securities Market” No. 39-FZ dated April 22, 1996, as amended, (ii) the execution and performance of the offering and services to be made available by The Elephant, as described in its White Paper and associated commercial terms, as changed from time to time, do not violate applicable laws of the Russian Federation and (iii) in making any payments in connection with offering and services, it has complied or will comply with the requirements of all applicable laws of the Russian Federation, including with respect to foreign currency transactions. The undersigned acknowledges that the The Elephant is relying in part upon the truth and accuracy of, and the undersigned's compliance with, the representations, warranties, agreements, acknowledgements and understandings of the undersigned set forth herein in order to determine its eligibility to gain access to as PrivatEquity's offering and services, as described in its White Paper and associated commercial terms, as changed from time to time and the undersigned is aware of the legal consequences of the foregoing.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is either an “institutional investor” as defined under Section 4A(1) of the Securities and Futures Act, Chapter 289 of Singapore (“SFA”) or a “relevant person” as defined under Section 275(2) of the SFA (including an “accredited investor” as defined under Section 4A(1) of the SFA).

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is an “investment professional” within the meaning of Article 11(1) of the Enforcement Decree of the Financial Investment Services and Capital Markets Act of South Korea.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is a “qualified investor” within the meaning of the Swiss Collective Investment Schemes Act of June 23, 2006, as amended, its implementing ordinance and regulatory guidance.

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is located or resident in the United Kingdom, it is a person of a kind described in Articles 19 and/or 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”), or that the offering or the services made available by The Elephant, as described in its White Paper and associated commercial terms, as changed from time to time, may otherwise be lawfully distributed to it pursuant another applicable exemption under the Order.

The undersigned acknowledges that these offering and services are only directed at (i) persons who have professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Order, (ii) high net worth entities (including companies and unincorporated associations of high net worth and trusts of high value) or other persons falling within Article 49(2)(a) to (d) of the Order, and (iii) persons to whom such offering and services may otherwise be lawfully distributed.

PLEASE NOTE EXTERNAL CONFIRMATION AND/OR EVIDENCE MAY BE REQUIRED BEFORE THE ACCREDITAION PROCESS IS COMPLETED

By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents that it is an “accredited investor” (an “Accredited Investor”) as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended, for one or more of the reasons specified below:

 Where the undersigned is a natural person:

 He or she has an individual net worth, or joint net worth with my spouse (determined by (i) subtracting total liabilities from total assets, and (ii) excluding the value of my primary residence), in excess of $1,000,000; and/or

 He or she had an individual income in excess of $200,000 (or a joint income together with my spouse in excess of $300,000) in each of the two most recently completed calendar years, and reasonably expects to have an individual income in excess of $200,000 (or a joint income together with my spouse in excess of $300,000) in the current calendar year.

 Where the undersigned is or acting on behalf of:

 a corporation, partnership, limited liability company or similar business trust or organization described in Section 501(c)(3) of the Internal Revenue Code not formed for the specific purpose of acquiring the Tokens that has total assets in excess of $5,000,000;

 a bank as defined in Section 3(a)(2) of the Securities Act, a savings and loan association, or other institution defined in Section 3(a)(5)(A) of the Securities Act acting in either its individual or fiduciary capacity (this includes a trust for which a bank acts as trustee and exercises investment discretion with respect to the trust’s decision to invest in the Token);

 a broker dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended;

 an insurance company as defined in Section 2(13) of the Securities Act;

 an investment company registered under the Investment Company Act of 1940, as amended (the “Investment Company Act”), or a business development company as defined in Section 2(a)(48) of the Investment Company Act;

 a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958, as amended;

 a plan established and maintained by a state, its political subdivisions, or an agency or instrumentality of a state or its political subdivisions, for the benefit of employees, having total assets in excess of $5,000,000;

 an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (a) for which the investment decision to acquire the Tokens is being made by a plan fiduciary, as defined in Section 3(21) of ERISA, that is either a bank, savings and loan association, insurance company, or registered investment adviser, (b) which has total assets in excess of $5,000,000, or (c) which is self-directed, with the investment decisions made solely by persons who are Accredited Investors;

 a private business development company defined in Section 202(a)(22) of the Investment Advisers Act of 1940, as amended;

 a trust not formed for the specific purpose of acquiring the Tokens with total assets in excess of $5,000,000 and directed by a person who has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of investing in the Tokens;

 a revocable trust (including a revocable trust formed for the specific purpose of acquiring the Tokens) and the grantor or settlor of such trust is an Accredited Investor; and/or

 an entity in which each equity owner is an Accredited Investor.

PLEASE NOTE EXTERNAL CONFIRMATION AND/OR EVIDENCE MAY BE REQUIRED BEFORE THE ACCREDITAION PROCESS IS COMPLETED

By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents the PEC tokens, as described in The Elephant's White Paper have not been registered under any securities laws in any jurisdiction (together with the Act, the “Securities Laws”), but rather are being and will be allocated by The Elephant pursuant to exemptions from registration under the Securities Laws.

Accordingly, the undersigned gives the following representations and warranties:

• It has the knowledge and experience in financial and business matters required to receive and use the PECs and/or services to be made available by THE ELEPHANT, as described in the White Paper, as amended from time to time, and as such it is capable of evaluating the merits and risks involved with them.

• The purpose of this declaration is to enable THE ELEPHANT and its affiliates to discharge its responsibilities under such exemptions and that THE ELEPHANT will rely upon the information contained herein, and therefore, the representations herein are complete, accurate and binding, and may be relied upon by THE ELEPHANT and its affiliates.

• Although THE ELEPHANT will use their best efforts to keep this letter strictly confidential, they may present this declaration and any other information which the undersigned has provided to them to such parties as they deem advisable if called upon to establish the availability under the Securities Laws of an exemption from registration of the offer and sale of the PEC or any other service to be made available by THE ELEPHANT, as described in the White Paper, as amended from time to time, or if the contents thereof are relevant to any issue in any action, suit or proceeding to which THE ELEPHANT or its affiliates is a party or by which they or it are or may be bound.

• Any offer or services that may be made available to the undersigned by THE ELEPHANT or its affiliates (i) will not constitute a violation of any laws or regulations, including the Securities Laws and investment advice laws, of any applicable jurisdiction; (ii) will be permissible under all applicable Securities Laws and shall not trigger any licensing, registration, or other requirements.

• It shall not transmit or otherwise send any information to which THE ELEPHANT will give it access to, to any person in any jurisdiction in which the distribution of such information and/or the offering or services to be offered by PEC are not authorized, or to whom such offer or invitation may be unlawful.

PLEASE NOTE EXTERNAL CONFIRMATION AND/OR EVIDENCE MAY BE REQUIRED BEFORE THE ACCREDITAION PROCESS IS COMPLETED

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By filling in this form and selecting the 'I confirm' button below, the undersigned hereby confirms and represents the information above does not qualify as a recommendation or an opinion with regard to conducting any transaction or investment. Each investor should conduct his or her own checks and verifications, while taking into account his or her specific circumstances and requirements. All the relevant aspects of the purchase, including the legal, economic and tax aspects, should be carefully examined with the assistance of professionals and consultants on the investor’s behalf.

The information above or on the site and the blog does not qualify as an offer of investment and is meant for general information only. Offers for selling of the securities will be delivered only to ‘Accredited Investors‘ as defined in the first supplement of the Israeli Securities Law, 5728-1968. The Elephant, shall not be responsible or liable and shall not guarantee in any way the return of the investments to investors, including any profits earned as a result of such investments. The engagement with the investors shall be in accordance with the transaction documents and the conditions stipulated therein, subject to the negotiations that will be held with the investors.

The Elephant charges fees from sellers and buyers of securities, and therefore The Elephant has an interest in the information posted about various companies.

The information published on the Site, does not constitutes an investment consulting as defined in the Regulation of Investment Consulting, Investment Marketing and Portfolio Management, 1995, and the said information is not a substitute for professional consulting which among others takes into consideration the special needs of every person.

For those who are considering making an investment (including sale and purchase of securities) via the website, can apply different laws deriving from their residence or citizenship, including tax laws, laws relating to the statement or report on investment activity, laws relating to the eligibility of investing, regulatory issues in process and so on. Therefore, those who are considering making such an investment, undertake to examine the applicability of any applicable laws, as they are committed to take all necessary action in order not to violate the said laws, including to disclose fully and fairly in relation to any investment to any local lawfully authority, as the law requires such disclosure.

We welcome you to The Elephant Investors Community, your gateway to the Secondary Market.

Note:
The provision of information in this website is not based on your individual circumstances and should not be relied upon as an assessment of suitability for you of a particular product, service, or transaction. It does not constitute investment advice, tax advice or legal advice and The Elephant Platform makes no recommendation as to the suitability of any of the products, services or transactions mentioned herein. The information included in this website is intended to “Accredited Investors” only, as this term is defined in the jurisdiction in which they reside (or such similar term in such jurisdictions financial regulations). Non-Accredited investors may not partake in any products, services or transactions mentioned herein or offered by The Elephant.


* Please note that the purchase of the shares of any Target Company may be subjected to right of first refusal of other shareholders, in some cases also to approval of the Target Company’s board of directors or other transfer restrictions as may be applicable.

How New Secondary Markets Are Helping Pre-IPO Shareholders Cash Out
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Note:
For those who are considering making an investment (including sale and purchase of securities) via the website, can apply different laws deriving from their residence or citizenship, including tax laws, laws relating to the statement or report on investment activity, laws relating to the eligibility of investing, and so on. Therefore, those who are considering making such an investment, undertake to examine the applicability of any applicable laws, as they are committed to take all necessary action in order not to violate the saids laws, including to disclose fully and fairly in relation to any investment to any local lawfully authority, as the law requires such disclosure.

How New Secondary Markets Are Helping Pre-IPO Shareholders Cash Out

Published by Benzinga.com | July 31,2017

In the financial world today, private equity trading is all the rage. Private equity funds are consistently outperforming the public markets. More often than not, tech startups choose to seek funding through private equity, avoiding the need for a public offering to raise capital.

This hesitation to go public, however, can become a problem for employees who received shares in their startup as compensation. It can also be problematic for former employees who are stuck with blocks of shares they cannot cash out or publicly trade.

Extending shares to employees can be beneficial and attractive initially, but it can become an issue down the line. Shareholders may be left with positions they cannot exit from, waiting impatiently for the company to finally go public.

Solutions to this problem are hard to come by. Sometimes companies will allow these shareholders an opportunity to sell their stock, but they often come with heavy restrictions and is frowned upon by the company. Such is the case with Airbnbwhich recently allowed its employees to sell back portions of their shares, but in return agreed to strong stipulations in relation to their remaining shares.

Nevertheless, there are numerous companies entering the space to help solve the dilemma for current and former employees along with major shareholders and interested investors. Companies such as SecondMarket and SharesPost are currently geared towards helping facilitate transactions between willing buyers and sellers, adding liquidity to an otherwise largely illiquid asset class.

PrivatEquity.biz, an emerging online peer-to-peer platform based out of Tel Aviv managed by co-CEOs Sigalit Cohen and Chaim Schiff, goes a step further by hosting a marketplace for current and former employees to expose their shares to private and institutional investors on a secure platform. The service connects shareholders with potential investors, offering guidance and support throughout the whole process of buying, selling, or trading shares.

The inventive platform has already created a lot of buzz, placing them on Red Herring’s list of top 100 innovative companies in Europe. Many employees of large pre-IPO companies such as GettDocuSignXiaomi, and Palantir have taken note, offering a stake of their shares on PrivatEquity’s diverse marketplace.

 

Another Hurdle Overcome For Private Shareholders

Shareholders holding onto stakes in their private company now have more options than ever before to trade their shares in a way that were previously unavailable. Shareholders wanting to cash out early can put their shares up for sale, benefiting from the liquidity of the secondary market. Their shares are then available to a larger network of private and institutional investors eager to invest in great ideas or rapidly-growing enterprises.

 

Employees also have a fair amount of flexibility when posting their positions. They are freely able to put up as much of their shares on the market as they deem fit. A seller might not want to give up all of their shares, instead choosing to part with just a fraction of their holdings.

Selling only a portion of their shares gives current and former employees a way to reduce their risk and diversify their exposure to other areas or simply cash out. They can sell their shares for an optimal market value while still keeping a stake in the company when there is a promise of future growth or a potential public offering.

 

Shareholders Benefit From More Liquidity Than Ever Before

Ultimately, everyone involved benefits from the added liquidity of secondary markets for private company shares.  Current and former employees are able value their existing holdings while increasing access to a willing marketplace filled with investors.

From an investor standpoint, these initiatives can help with the process of cashing out before an IPO or sale.  The traditional problem of illiquidity attached to private company shares has been overcome considering the unique platforms designed to match willing sellers to eager buyers.

Former employees can finally cash in on the benefits of the shares they’ve been holding onto. By finally ridding themselves of blocks of stocks they are forced to keep, they can move on and benefit in the process.

For current employees, they can take advantage of their company’s success and not be restricted by limiting policies and freezes on selling shares. For investors of all shapes and sizes, the addition of liquidity helps both buyers and sellers for a market that has traditionally proven the exact opposite.

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