This offering has not been registered with any federal, state, local or foreign securities authorities. The offer and sale of the Interests will not be registered under the Securities Act or the laws of any applicable state pursuant to an exemption from the registration requirements of the Securities Act and the securities laws of certain states. Each Member must furnish certain financial information to the Sponsor and represent, among other customary private placement representations, that it is acquiring its Interests for investment purposes and not with a view towards resale or distribution. The acquisition of Interests by each Member also must be lawful under applicable federal and state securities laws or the laws of the applicable foreign jurisdiction if the Member is a non-U.S. person. The Interests have not been, and will not be, registered under the Securities Act. Accordingly, the United States securities laws impose certain restrictions upon the ability of a Member to transfer such Interests. Interests may not be offered, sold, transferred or delivered, directly or indirectly, unless (i) such Interests are registered under the Securities Act and any applicable state securities laws, or (ii) an exemption from registration under the Securities Act and/or any applicable state securities laws is available. Moreover, there will be no liquid, public market for the Interests, and none is expected to develop. Further, Interests may not be offered, sold, transferred, assigned or delivered, directly or indirectly, to any person deemed unacceptable by the Sponsor, in its sole discretion. If an Interest is transferred in violation of this provision, the Sponsor may, at its sole discretion, subject the Interest to repurchase by the Company or treat the Member as a defaulting Member under the terms of the Limited Liability Company Agreement. Unacceptable persons include, but are not limited to, any person who is known to be a: person or entity who is a “designated national,” “specially designated national,” “specially designated terrorist,” “specially designated global terrorist,” “foreign terrorist organization” or “blocked person” within the definitions set forth in the Foreign Assets Control Regulations of the United States Treasury Department, 31 C.F.R., Subtitle B, Chapter V, as amended; person acting on behalf of, or an entity owned or controlled by, any government against whom the United States maintains economic sanctions or embargoes under the Regulations of the United States Treasury Department, 31 C.F.R., Subtitle B, Chapter V, as amended-- including, but not limited to the “Government of Sudan,” the “Government of Iran,” the “Government of Cuba,” the “Government of Syria” and the “Government of Burma”; or person or entity subject to additional restrictions imposed by the following statutes or Regulations and Executive Orders issued thereunder: the Trading with the Enemy Act, the Iraq Sanctions Act. Pub. L. 101-5 13, Title V, §§ 586 to 586J, 104 Stat. 2047, the National Emergencies Act, 50 U.S.C. §§ 1601 et seq., the Antiterrorism and Effective Death Penalty Act of 1996, Pub. L. 104 132, 110 Stat. 1214 1319, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., the United Nations Participation Act. 22 U.S.C. § 287c, the International Security and Development Cooperation Act, 22 U.S.C. § 2349aa-9, the Nuclear Proliferation Prevention Act of 1994, Pub. L. 103 236, 108 Stat. 507, the Foreign Narcotics Kingpin Designation Act, 21 U.S.C. §§* 1901 et seq., the Iran and Libya Sanctions Act of 1996, Pub. L. 104 172, 110 Stat. 1541, the Cuban Democracy Act. 22 U.S.C. §§ 6001 et seq., the Cuban Liberty and Democratic Solidarity Act. 22 U.S.C. §§ 6021-91, and the Foreign Operations, Export Financing and Related Programs Appropriations Act, 1997, Pub. L. 104 208, 110 Stat. 3009 172, or any other law of similar import as to any non-U.S. country, as each such Act or law has been or may be amended, adjusted, modified, or reviewed from time to time. Any projected results included in this Memorandum are forward-looking statements that involve significant risks and uncertainty. All materials or documents supplied by the Company or the Partnership should be considered speculative and are qualified in their entirety by the assumptions, information and risks disclosed in this Memorandum. The assumptions and facts upon which such projections are based are subject to variations that may arise as future events actually occur, many of which are outside the Company’s, the Partnership’s and Sponsor’s control. Any projections included in this Memorandum, including target XIRR, ROI, Investor Multiple, and valuations, are based on assumptions made regarding future events. There is no assurance that actual events will correspond with these assumptions. Actual results for any period may or may not equal currently estimated, approximate projections and may differ significantly. Therefore, prospective investors should consult with their tax and business advisers about the validity and reasonableness of the factual, accounting and tax assumptions contained in this Memorandum. Neither the Company, the Partnership nor any other person has been authorized to make any representation or warranty as to the future profitability of the Company, the Partnership or an investment in any interests in either of them. There may be clerical errors in this Memorandum. Any clerical mistakes or errors in this Memorandum should be considered ministerial in nature. Operational Risks The Partnership’s operations are subject to all business risks associated with new enterprises and the Company’s results are dependent on the results achieved by the Partnership. There can be no assurance that the operations of the Company or the Partnership will be profitable, that the Company or the Partnership will generate any positive returns, or that any investment in either of them will be recouped. The Partnership has significant leverage. Although the purpose of leverage is to provide flexibility and additional liquidity options to the Partnership, reduce the amount of capital contributions required by investors in the Property and potentially increase the overall investor return, use of leverage is inherently risky and can instead increase the risk of loss. The effect of the use of leverage in a market that moves adversely to its investment could result in a substantial loss to the Partnership that would be greater than the loss if the Partnership were not leveraged. In addition, failure to satisfy the terms of debt incurred by the Partnership can have negative consequences, including forced liquidation of the Property in order to satisfy the borrower’s obligations. Any capital invested by the Company in the Partnership may be made available to satisfy all liabilities and other obligations of the Partnership. The Partnership may experience undercapitalization if Limited Partners fail to make their capital contributions. From time to time during the Partnership term, the Partnership may make capital calls to its Limited Partners (including the Company) for capital contributions based on each Limited Partners’ respective capital contributions. In the event one or more Limited Partners fails to make their share of a capital contribution when called by the General Partner, the Partnership may experience undercapitalization. The Members generally have no rights to manage the operations of the Company (and indirectly the Partnership) and must rely on the General Partner. Other than the right to vote in very limited scenarios described in the Amended and Restated Limited Partnership Agreement, (and the Limited Liability Company Agreement), each Investor has no right or power to exercise day-to-day control over the affairs of the Partnership or the Company, make decisions with respect to management, disposition or of the Property or the Company’s interest in the Partnership, or make other decisions regarding the business of the Partnership or the Company. Consequently, the success of the Company will depend, in large part, on the skill and expertise of the General Partner.
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