Loanatik Streamlines Mortgage Process

•OVERVIEW
Loanatik streamlines the residential lending process by eliminating
waste, empowering borrowers, and applying technology to an industry
that hasn't fundamentally innovated the customer's experience in the
modern age. Loanatik has combined the industry's top financial and
technological minds to develop a new kind of mortgage company
from the ground up to provide the best user experience, unparalleled
customer service, a crazy-simple application, and insanely low rates.
Borrowers have two problems: they hate applying for a loan but they
also want to save the most money possible. Getting the best rate
usually means researching and even more time undergoing a process
that the consumer dreads. Loanatik solves both problems at the
same time by presenting a unique application process that takes the
borrower from application to decision in the fewest steps possible,
while delivering them a rate so low, they'll tell their friends about it.
The best investors in the world have access to huge amounts of data
and brilliant people and software to interpret that data. They also
have the connections and access to be able to invest in some of the
best investments that aren't readily available to the ordinary investor.
Loanatik solves all of these problems by placing the same types of
secured mortgages that large banks invest in every day direct to
regular investors.
Online tools derived from our data capture will equip our users with
powerful analytics. Full social integration and built-in messaging
will allow users to interact and actively discuss opinions, details,
and strategy on specific investments, empowering them with a
comprehensive picture on which to base their most important
financial decisions.

BUSINESS MODEL:
Mortgage bankers make money by charging origination,
documentation, and processing fees. Additionally, they make 40 basis
points hedging interest rate risk and earn a spread on mortgages held
for servicing, or alternatively, mortgage bankers receive a servicing
release premium.
Loanatik introduces proprietary technology into this origination
model, reducing the cost to acquire new customers, process and
underwrite loans.
Typically, mortgage banks will sell servicing rights, but, it is our intention
to retain them and crowdfund every mortgage we originate. Investors
will be able to earn interest on their investment, which is secured by
real property, and unlike traditional real estate investment, they will be
able to quickly and easily liquidate their positions at any time by re
listing and interacting with other users via our crowdfunding platform.
CROWD LENDING:
Mortgages originated by Loanatik, as well as other participating
institutions, can use our crowdfunding platform to provide a secondary
market for their loans. Our platform serves two types of customers:
professional investors looking to have more control over the collateral
in their mortgage pools, and casual investors looking for consistent,
secure returns in real estate investments.
•

•FUTURE EXPANSION:
Loanatik is licensed to originate mortgages in COLORADO and TEXAS.
Licenses for AZ, CA, VA, MD, WA will be issued by 04 2015. CA, MD,
VA, and WA will be issued by 04 2015. These seven states represent
nearly 50% of all mortgage originations in the US. Our expansion
strategy is to simply expand our licensing to the most densely
populated states with the most favorable lending laws first,
with eventual full US coverage by 03 2016.
MARKET SIZE
The mortgage origination market is over $1.1 TRILLION, with the top 25
companies originating less than half of the total market. There is a lot of
space left over for multiple competitors to gain market share and enjoy
plenty of success.

OUR COMPETITION
INCUMBENT BANKS
There are over 6,000 banks in the country offering residential mortgages.
While being directly competitive with us on interest rates, they lag behind
tremendously on technological innovation efforts. Many won't risk massive
changes to their infrastructure, instead preferring to sit on the sidelines and
observe startup efforts like ours for possible investment or future acquisition.
ONLINE ORIGINATORS
The majority of these firms do not have IT infrastructure and they tend
to combine off-the-shelf software solutions in order to supply their entire
technology stack, thus lacking the experience to develop sophisticated
online banking systems. While they have scaled incredibly, their lack of
focus and dedication to building out a thoughtful, custom solution means
they are built on fragile and shallow underpinnings.
TECHNOLOGY INNOVATORS
Companies such as Kabbage and OnDeck Capital offer lending-related
products, but lack a strong background in compliance and ability in
mortgage origination.
tW Kabbage OnDed<
•

•OUR COMPETITION CONTINUED
FINTECH COMPANIES
There are a number of already established FinTech players like Prosper
and LendingClub, and a number of younger companies and startups like
FundRise, Realty Mogul, Sindeo, and Lenda.
Companies like Prosper have the money and ability to potentially pivot,
but would have to adjust their core business model drastically to bring in
underwriting and other support for non-subprime lending. There are also a
handful of startups that, while they haven't officially announced these types
of products, are exhibiting clues like hiring patterns that indicate they may
enter the residential mortgage space.
COMPETITIVE LANDSCAPE
Ability to Execute
(in technology,
viability, services,
features
Focus On Tomorrow
Challengers
guarantee.
,.,.......-.... FR�OM MORTG1GE
GREENLIGHT
LOANS
QuickenLoans·
loan epot, LLC
[!Dbank.
. . .
CHASEO
BankofAmerica�
Niche Players
cffi
MORTGAGE
Leaders
loanatik
sindeo·L d··z··en eon
Lendfnvest
i;gLendingClub
PROSPER.p
¢ Lendo
, Kabbage
OnDedo
Visionaries
Completeness of Vision
(in technology, viability, services, features)
Focus
On
Today

STRATEGIC ALLIANCE:
Loanatik is part of the Wasabi Ventures Academy.
EXIT STRATEGY:
The mortgage origination business is profitable from the beginning,
taking approximately eighty basis points to the bottom line. With each
technological advancement that we develop and implement, that
margin increases further.
Possible exit scenarios that would likely arise would be a sale to some
kind of incumbent or other strategic buyer. In that event, we would wait
for the next peak in the housing market to maximize value, however,
we are not actively planning for a short or near-term exit.
The team's primary goal is to realize all of
the developments we've outlined and build
the best product that's ever been presented
to users that are borrowing money.
•

•INVESTMENT SUMMARY
Loanatik is raising $1.5MM of investment capital in the form of
convertible notes that convert at a 20% discount to the valuation
established in the next round of financing, and have a valuation cap
of $7MM.
Sources & Uses of Funds
Source of Capital
Founders Capital................................................................$750,000
New Equity...........................................................................1,522,000
Total Sources: $2,272,000
Uses of Capital
Mortgage Banking Licesing...........................................$52,000
Mobile/Web App Develoment.......................................835,000
Marketing............................................................................265,000
CAPEX....................................................................................30,000
Operations..........................................................................275,000
Softare Licensing.................................................................65,000
Cash Reserves..................................................................750,000
Total Uses: $2,272,000

,,,--- .........
...
......
,,,---- ...............
......
MEET OUR
MANAGEMENT TEAM
COREY SCHWARTZ
PRESIDENT
•
Built Programmer's Warehouse in 1987 into a worldwide publisher and
mail order distributor of programming tools. Exited 1995.
Founded Serinova Financial in 2003 and the Serinova Mortgage
Income Fund and was ranked as the 4th largest private lender in
the State of Arizona by the AZ Business Journal. Exited 2010.
Founded three real estate funds and acquired $60MM of commercial
assets as the managing partner. Exited December 2014.
MICHAEL JACOBY
CHIEF MARKETING OFFICER
Managing partner of JKP, an LA-based imaging and color science
firm that pioneers technological advances for companies like
Disney, Samsung Electronics, and Universal.
Founder at Ambature, a Cupertino-based nanotechnology
company developing high-temperature superconducting materials.
SIDNEY FINGERHUT
VP INVESTOR RELATIONS
As the CEO of Fingerhut Enterprises, Sid guided the direct-to
consumer marketing conglomerate to an eventual $1.5 billion sale.
Prior to Fingerhut, Sid served as VP of Business and Strategic
Strategies for Nynex Consulting Group, overseeing sales and
engineering teams, new business development, and corporate
accounts worldwide.

LOANATIK FAQ
What relevant experience does the team have in the domain?
The individuals in our team have a completely diverse, yet complementary, set
of skills and experience that enables us to see what the industry can ideally be,
while having the technical knowledge and background of how the industry works
so we can navigate strategically.
We are merging our collective experience in lending, mortgages, real estate,
consumer technology, computer science, direct marketing, hospitality, and
game design - distilling key aspects of those industries into building a robust,
feature-rich, and compelling app on top of a well-organized, dynamic, and
data-driven company.
What are some key team additions needed imminently?
While the leadership team has deep technical roots and experience, we lack
a strong in-house programming team and will need to build this out. All of our
existing team members have a depth of experience that has generated access
to large networks of talented people. In addition, we have extremely large
databases of local and remote talent throughout the software and lending
industries. Recruiting will primarily be through referrals.
Can other mortgage companies access Loanatik's secondary marketplace?
The Loanatik Marketplace is designed from the ground up to allow primary
market participants (banks and mortgage banks) to sell their loans to Loanatik's
investors. This is achieved seamlessly through a secure API. The performance
of each individual loan is meticulously tracked and tied directly to both the
originating company and underwriter. This data is available to professional
investors on the platform and may used to decide whether or not to invest in a
new loan originated by the company/underwriter.
There are also a handful of startups that, while they haven't officially announced
these types of products, are exhibiting clues like hiring patterns that indicate they
may enter the residential mortgage space.
•

•FAQ CONTINUED...
Why would lenders want to sell their loans in the Loanatik secondary market?
Primary market participants benefit from being able to sell their loans in the
Loanatik Marketplace for a variety of reasons:
(i) Loanatik has no "bulking" requirements. This means that even one loan can
be sold immediately on our platform, rather than having to wait until $10MM of
loans have been originated. This reduces the amount of time the originator
has the loan on their warehouse line and thereby reduces their costs.
(ii) Loanatik will accept electronic files rather than require imaged original tax
returns and W-2 documents from the borrower.
(iii) It is a long and difficult process to become a Fannie/Freddie approved
seller/servicer. Many sellers never qualify for a direct relationship and are
forced to sell to firms that are Fannie/Freddie approved. The result is that
smaller and indirect sellers can earn more money selling through Loanatik.
How many are currently on the team, including contractors/outsourcers?
There are currently eleven members of the team. Besides the core management,
we have members in place for social marketing/ SEO, a crowdfunding architect,
graphic designer, underwriter, loan officers, and various programmers.

FAQ CONTINUED...
What motivates the team?
Loanatik's primary mission is to make lending simpler on both sides of the table.
We are creating a world where it's easy and safe to both borrow and lend money.
Technology has democratized everything from shopping to hotels to hailing a
cab. The big banks that have ruled the land forever have incorporated technology
at a snail-like pace, but suffocating regulations have served as a wide moat that
has prevented drastic innovations to turn the industry on its head. Not very long
ago, it was virtually impossible for someone to sell a million books by themselves
online, to open up their own virtual shop with no overhead and sell handmade
goods from Omaha to someone in Austria, or to take videos from the comfort of
your bedroom and become a YouTube celebrity.
We see a future where anyone can invest the way a bank does, in the same
things that banks invest in, from their phone. The team understands that capital, in
any form that it comes in - whether it be a loan from a bank or a person, or social
- from a friend that donates time or advice, is the primary driver of our economy
and our world. Everyone from the random coffee shop to sovereign nations
borrow money to grow and be successful. With the power of the crowd and big
data, we can broker that success and empower millions of people.
Why will users care about your service?
Market research shows that borrowers in today's market ultimately care about
rate. Borrowers will consistently find us in the top three spots for a competitively
low rate. And as much as we will attract attention through our outstanding rates,
borrowers will have a lasting impression from us just as much from the process
as the product. Our direct and simple approach to applying, coupled with an
extremely smooth and speedy transition from application to funding, will be a
customer service experience that is completely foreign to the lending market.
Users of our service will care because we will genuinely care about them... our
product is predicated on creating the simplest way to borrow; simplicity is easy to
remember and easy to share with others.
In addition, our electronic underwriting system underwrites a borrower based on
public and private third party data. This allows us to lend to people that have poor
documentation of their income, while eliminating the potential for a prospective
borrower to falsify the data.
•

•FAQ CONTINUED...
What milestones have you already accomplished?
The company has been formed and issued convertible promissory notes. We
became licensed as a mortgage bank in TX and CO. We have pending licenses
in AZ, CA, VA, MD & WA. We have licensed and customized a CRM system,
built state of the art lead pages and configured a custom cloud based phone
system. We have purchased a specialized accounting system and licensed a
loan origination system, both specifically designed and customized for our model
of mortgage banking. All of these systems have been integrated together so
that data flows seamlessly from the web to the CRM and to the phone system,
which enables us to respond almost instantly to a borrower's inquiry. Data also
flows seamlessly from the CRM to the loan origination system and then to the
accounting systems in an automated fashion. We have established relationships
with data providers for credit reporting, flood reporting, tax return services,
document preparation services, credit reporting systems, and pre- and post
closing compliance software.
What are impending milestones?
Natively generating inbound leads; refine Integration of leadpages; CRM &
phones; Finish configuration of the loan origination system and originate our
first loan; Obtaining a warehouse line; Our first delegated correspondent
relationship; Launch corporate marketing site; Launch borrower portal;
Launch crowdlending site; Implement crowdlending iOS and Android
apps; Design and implement Borrower Portal iOS & Android
Apps; Get approved for a Fannie and Freddie direct relationship;
Begin hedging; Obtain access to the FHLB system; Complete the
applications for a mortgage banking licenses in NY & FL.
Our system architecture has been completed and additional
software has been identified to fulfill our various
remaining needs.

FAQ CONTINUED...
What advantages do the competitors have over you?
Market intelligence, market experience, and funding.
What are some killer features you anticipate potentially adding in the future?
We are aligned with the JOBS act legislation that is seeking to open up previously
unavailable participation in investment vehicles to the average consumer. There
is a huge untapped market of middle class savers and investors that have, until
this point, been relegated to minuscule returns from savings accounts, CDs, and
highly managed funds with fees that destroy any kind of return they can manage
to achieve. This presents hurdles in overcoming fear and educating
the consumer.
As we wait for regulations to ease, we can take steps now by building out a
free version of our core crowdlending platform that will have strong educational
components in the form of direct tutorials and realistic simulations. Part of our
team includes game designers and gamification experts that are instilling fun and
engaging elements to our app from the very beginning. We can introduce an
actual investment/empire-building (think SimCity or Monopoly) game that runs on
our core platform that will familiarize the mass audience with equity investment
theory as well as the mechanics of our app. As soon as we are allowed to, we
can engage in converting that free audience to active users on our real-money
crowdlending site.
Our data collection on the lending site and full underwriting process will also
provide us with ingredients that can be leveraged into powerful credit tools for
both borrowers and lenders. We do a full credit analysis that goes beyond credit
score and income since we will gain access to transaction history; given a certain
threshold of data, we can start building some practical and highly accurate credit
tools in our system.
What are the key barriers to entry?
Individual state licensing, high startup costs, complexity of modern day loan
origination systems, and regulatory compliance provide tremendous barriers to
entry and were one of the key reasons that we entered the market when we did.
•

"'6
•FAQ CONTINUED...
What is the marketing plan for the company? For social media? For PR?
For customer acquisition?
Our customers, and therefore our marketing effort, will be twofold. Homebuyers and
refinancers will interact with our mortgage bank and accredited investors will interact
with our crowdlending platform.
Our preliminary market research has yielded high engagement and click-through
rates, while demonstrating that rates are paramount to our customers. We
acknowledge that by staying in the top 3 competitive interest rate rankings, and
reflect it in our marketing tagline (Our Rates Are Insane!). Since we are pre-rev, we
have a limited scope of data but are already building-in massive amounts of data
harvesting tech, policies, and practices to ensure we have enough to methodically
iterate on our evolving approach to customer service.
Borrowers are fed up with institutional lending. They yearn for the simplicity that
they've grown accustomed to from mobile and on-demand apps. While we attract
customers with our low rates initially, we stimulate word-of-mouth by delivering a
proprietary experience from application all the way to funding. Documentation and
effort from the consumer is minimal, saving time and stress, while providing
a uniquely referable experience.Customers will initially be acquired through native
ads, search engine ads, SEO, and lead purchases. Some legacy advertising mediums
will be employed in specific local markets like print ads, and radio, which is still an
effective ad medium for finance products statistically.
Future acquisition will come from a coordinated marketing campaign on
several fronts, leveraging a then-proven customer service model with a
brand identity push and phased content marketing on the lending side.
An affiliate model and a free-play app version on the crowdlending side
will open up the app to the general public to simulate investing as
an educational tool and bridge to conversion to an active
consumer-investor.
•••••••
lllliiiiiifl-···· ··�'-·-

FAQ CONTINUED...
How will we compare to our competitors in terms of rate, service, performance,
usability etc.?
The Loanatik brand is positioned as a rate leader and will consistently be in the
top of online rate charts. Our ranking will move up or down a few spots because
the market rates move dynamically, but they will always stay competitive.
Where we can really differentiate ourselves is in our concerted approach
to customer service, and how we design and deliver our product. Corey's
experience in the private lending market and hospitality industry are reflected in
an attentive approach to detail. We anticipate leveraging every piece of data we
collect to inform us about how to better serve our customer while continue
to evolve our process and product in ease-of-use and speed.
What are the biggest legal/regulatory/market risks the company faces?
Mortgage lending laws are complex and confusing, but our compliance with the
law is crucial. Properly used, our loan origination system combined with oversight
from lawyers and auditors, ensures our compliance with the law. Employees
failing to use the system properly will be expose us to fines from the regulators.
The company is also in the securities business. Like mortgage lending securities
laws are also complex and failure to comply with the laws will again expose the
company and management to both civil and criminal disputes.
While we have expert counsel in all of these areas, the company will inevitably
be accused of failing to comply with the law even though we believe we are in
compliance. This is simply a cost of doing business in regulated fields.
What/when is the goal for exit?
Our goal is to build a highly profitable, nationwide lending platform that returns
money to its investors. While an exit of any kind is not out of the question, it is not
one of our stated goals.
•

•FAQ CONTINUED...
Who would be the likely contestants for an acquisition?
Existing banks and non-depository banks would be likely acquirers. In addition to
professional investors such as Sequoia Capital, Battery Ventures and Andreessen
Horowitz, non-traditional investors such as Google Ventures, Goldman Sachs, and
Deutsche Bank have been active participants in the FinTech space.
SEQUOIA¥-'CAPITAL
ANDREESSEN HOROWITZ •••Battery Ventures
Deutsche Bank 1/1
How will valuation in the event of an exit be determined?
A potential acquirer would make an offer and if the management team felt the
offer was fair, we would accept it. The amount of the offer would set the valuation.
Are you planning to pay dividends?
If there is surplus cash available for distribution management would consider
returning those funds to the investors. It is unlikely that any funds would be
available for distribution in less than 24 months.

FAQ CONTINUED...
Financial projections?
A financial model and video explaining the model are available in the Investor
Slack Channel. Prospective investors may gain limited access to the channel by
sending an email to invest@loanatik.com requesting access.
In the event of a sale before the convertible note is executed, what happens?
The notes have all have a conversion clause upon any qualified financing, which
would include a sale of the firm. Prior to the sale, the notes would convert and
then be considered equity during the sale.
How much equity has the company raised and in what form? Capitalization
structure?
The 1.5MM seed round is in the form of convertible debt with a 20% discount to
the "/J.!.' round valuation, with a $7MM valuation cap. Of the $1.5MM about 11% has
been sold. The management team has contributed $750,000 in the form of cash
and notes receivable.
Burn rate?
We anticipate spending approximately $2MM by the end of 1016.
What key metrics will the management team be paying close attention to
during growth?
There is a myriad of metrics that different parts of the team pay close attention to.
For example, the sales and marketing management teams will pay close attention
to conversion rates, lead cost per closed loan, and speed and efficiency of the
sales team in reaching prospective clients. The hedging desk pays attention to
cost of funds, macro market movements, trades won/lost. The processing and
underwriting teams are focused on pipeline efficiency and accuracy.
•

•FAQ CONTINUED...
What about your valuation?
It seems that hardly a week goes by without reading about the next crop of
Unicorns coming out of Silicon Valley. Frankly, we don't care about valuation at
this stage. They are fictitious numbers that neophyte entrepreneurs get doe-eyed
over. Liquidation preferences and other terms of the later financing rounds are
more important to the beneficial interests of the early-stage investors.
We are creating a highly profitable business that transforms an archaic financial
system into a modern, efficient marketplace where all of the participants are
equal, regardless of their size and investment capacity.
How will the market landscape look in 10 years if your product successfully
penetrates the market?
We envision a future where individuals can harness a lot more power and
control over their own financial destiny than they ever thought possible. We
see that borrowing and lending money can be simple, easy, and painless.
Interest rates will be more reflective of real-time market factors supplied by
massive data utilization.
Transactions will happen faster, they will be cheaper, and a sizeable share of
mortgages will effectively happen on a person to person basis, enabled by
our platform.

•FAQ CONTINUED...
What's with the name?
We are competing in a 1.1 trillion dollar market with thousands of competitors.
Loanatik is a strong, fun, slightly irreverent, and memorable consumer-oriented brand
designed to cut through the noise and confusion of all the competition. The name
draws inspiration from the highly successful Crazy Eddie brand created in the 1980's,
yet the brand is influenced by modern viral marketing campaigns from the likes of
Dollar Shave Club and Old Spice.
Prior to choosing the name, we retained SmashBrand, an internationally recognized
branding firm, to validate our selection. They surveyed 1,300 potential mortgage
consumers and found that the name was highly polarizing, with roughly half of the
respondents loving the name, and the other half hating it.
When those same potential consumers were presented with a BankRate style
webpage listing offers from well-recognized national brands and Loanatik,
SmashBrand found that shoppers clicked on Loanatik nearly 100% of the time
regardless of whether they loved or hated the name, providing that the rate
was competitive.

•FAQ CONTINUED...
Do we fear retribution from Fannie, Freddie, Goldman Sachs? Corporate espionage,
PR sabotage, etc.?
With Ashley Madison being at the forefront of the news, the country has become
acutely aware of the level of hacking, espionage, and sabotage that is endemic
throughout corporate America. Without a doubt, we will see competition in a variety of
forms from disenfranchised market participants.
We have a slew of attorneys advising on everything from lending to compliance to
securities and taxation and do our very best to play exactly within the confines of the
legal system. That said, the distraction caused by an investigation or security breach is
very real, and depending on the maturity of the business, could potentially have either
a negative or positive effect on the firm.
Why haven't other companies done this before if the technology exists now?
The technology exists, but is very new. In some cases, less than two years old. The
regulatory environment since 2009 has been extremely challenging. Navigating all
of the various pieces of technology, finance, and legal issues takes people with very
unusual combinations of skill sets.
There are other companies working toward similar kinds of solutions and we will
certainly have competitors. The mortgage market is so large that there is plenty of
room for all of the competitors to participate in the market and be profitable.

FAQ CONTINUED...
What stops them from squishing us like a bug if Goldman Sachs decides to
enter the market? Why wouldn't they launch a similar venture?
Historically, the incumbents are not very good at innovating. Their valuations are
very stable and for that reason, stock packages for high quality employees aren't
worth very much. Their pay structures are well established, so attracting high
quality talent is very difficult for entrenched companies. All of the incumbents
have active venture arms who enable innovators, like Loanatik, to do the hard
work. They wait until there is a clear leader in a specific technology and then
acquire the technology.
•

loanatikeour Rates Are Insane!

How to Lend
If you satisfy the investor suitability standards outlined on the attached pages and are interested in
lending to the Company, please complete and sign the Qualification Agreement and return to
LOANATIK, 8520 E Shea Blvd #115, Scottsdale, AZ 85260, Attention: Corey Schwartz, along
with a check or money order payable to “Loanatik Operating Account” for the full amount of the
purchase price of all the units for which you are subscribing.
Loans will not be considered complete until funds and signed paperwork are received. If you
choose to fax your paperwork please follow the wiring instructions below to transfer your funds.
Wire Instructions:
Bank of America
16851 N Tatum Blvd
Phoenix, AZ 85032
(602) 569-4034
ABA/Routing # 026009593
For Credit To:
Acct Name – Loanatik
Acct Number – 457032592207
For Assistance:
Corey Schwartz
T: (480) 568-0327
cschwartz@loanatik.com
Sid Fingerhut
T: (480) 568-0329
sfingerhut@loanatik.com

WEST259127428.2
LOANATIK, INC.
ACCREDITED INVESTOR QUESTIONNAIRE
Investors in Loanatik, Inc. (the “Company”), must meet certain requirements in order to
comply with the nonpublic offering exemption from registration under the federal Securities Act of
1933, as amended, and applicable state securities laws. Before any sale of securities is
consummated, the Company must be reasonably satisfied that the purchaser is an “accredited
investor” and has sufficient financial expertise to be able to evaluate the merits and risks of an
investment in the Company.
The purpose of this Questionnaire is to confirm to the Company, whether or not the
undersigned, as a potential investor in the Company, constitutes an “accredited investor.” This
Questionnaire does not constitute an offer to sell or a solicitation of an offer to purchase any
securities. ANSWERS WILL AT ALL TIMES BE KEPT STRICTLY CONFIDENTIAL. The
undersigned agrees by signing this Questionnaire, however, that the Company may present this
Questionnaire to such parties as it deems appropriate if called upon to establish the legality of the
participation of the undersigned in the offering.
By signing this Questionnaire, the undersigned hereby represents that the undersigned has
read the definition of “Accredited Investor” from Rule 501 of Regulation D attached hereto as
Exhibit A and certify that either (check one):
 The undersigned is an “Accredited Investor” (please check the appropriate box on
Exhibit A to indicate which of the categories listed describes the investing entity or individual); or
 The undersigned is not an “Accredited Investor.”
BY EXECUTION HEREOF, THE UNDERSIGNED REPRESENTS AND WARRANTS TO THE
COMPANY THAT THE INFORMATION CONTAINED HEREIN IS COMPLETE AND
ACCURATE IN ALL RESPECTS, AND MAY BE RELIED UPON. THE UNDERSIGNED
UNDERTAKES TO NOTIFY THE COMPANY PROMPTLY IF THERE IS ANY MATERIAL
CHANGE IN ANY SUCH INFORMATION.
Dated: __________________, 2015
Print Name of Investor
By:
Signature
Its:
Print Title (if applicable)
State of Domicile:
Daytime Telephone Number:
Email:
Daytime FAX Number:

WEST259127428.2
EXHIBIT A
Rule 501. Definitions and Terms Used in Regulation D.
As used in Regulation D, the following terms have the meaning indicated:
(a) Accredited Investor. “Accredited investor” shall mean any person who comes within any of
the following categories, or who the issuer reasonably believes comes within any of the following categories,
at the time of the sale of the securities to that person:
 (1) Any bank as defined in section 3(a)(2) of the Act, or any savings and loan association or
other institution as defined in section 3(a)(5)(A) of the Act whether acting in its individual
or fiduciary capacity; any broker or dealer registered pursuant to section 15 of the Securities
Exchange Act of 1934; any insurance company as defined in section 2(a)(13) of the Act; any
investment company registered under the Investment Company Act of 1940 or a business
development company as defined in section 2(a)(48) of that Act; any 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; any 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 total assets in
excess of $5,000,000; any employee benefit plan within the meaning of the Employee
Retirement Income Security Act of 1974 if the investment decision is made by a plan
fiduciary, as defined in section 3(21) of such act, which is either a bank, savings and loan
association, insurance company, or registered investment adviser, or if the employee benefit
plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment
decisions made solely by persons that are accredited investors;
 (2) Any private business development company as defined in section 202(a)(22) of the
Investment Advisers Act of 1940;
 (3) Any organization described in section 501(c)(3) of the Internal Revenue Code,
corporation, Massachusetts or similar business trust, or partnership, not formed for the
specific purpose of acquiring the securities offered, with total assets in excess of
$5,000,000;
 (4) Any director, executive officer, or general partner of the issuer of the securities being
offered or sold, or any director, executive officer, or general partner of a general partner of
that issuer;
 (5) Any natural person whose individual net worth, or joint net worth with that person's
spouse, exceeds $1,000,000.
(i) Except as provided in paragraph (a)(5)(ii) of this section, for purposes of
calculating net worth under this paragraph (a)(5): (A) The person's primary
residence shall not be included as an asset; (B) Indebtedness that is secured by the
person's primary residence, up to the estimated fair market value of the primary
residence at the time of the sale of securities, shall not be included as a liability
(except that if the amount of such indebtedness outstanding at the time of sale of
securities exceeds the amount outstanding 60 days before such time, other than as a
result of the acquisition of the primary residence, the amount of such excess shall be
included as a liability); and (C) Indebtedness that is secured by the person's primary
residence in excess of the estimated fair market value of the primary residence at the

WEST259127428.2
time of the sale of securities shall be included as a liability;
(ii) Paragraph (a)(5)(i) of this section will not apply to any calculation of a person's
net worth made in connection with a purchase of securities in accordance with a
right to purchase such securities, provided that: (A) Such right was held by the
person on July 20, 2010; (B) The person qualified as an accredited investor on the
basis of net worth at the time the person acquired such right; and (C) The person
held securities of the same issuer, other than such right, on July 20, 2010.
 (6) Any natural person who had an individual income in excess of $200,000 in each of the
two most recent years or joint income with that person'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;
 (7) Any trust, with total assets in excess of $5,000,000, not formed for the specific purpose
of acquiring the securities offered, whose purchase is directed by a sophisticated person as
described in §230.506(b)(2)(ii); and
 (8) Any entity in which all of the equity owners are accredited investors

WEST259129440.2
LOANATIK, INC.
CONVERTIBLE PROMISSORY NOTE
PURCHASE AGREEMENT
July 14, 2015

WEST259129440. 2 1
LOANATIK, INC.
PURCHASE AGREEMENT
This Convertible Promissory Note Purchase Agreement (this “Agreement”) is made as
of July 14, 2015, by and among Loanatik, Inc., a Delaware corporation (the “Company”), and
each of the investors listed on Exhibit A attached to this Agreement (each, a “Purchaser” and
together, the “Purchasers”).
RECITALS
The Company desires to issue and sell and the Purchasers desire to purchase convertible
promissory notes in substantially the form attached to this Agreement as Exhibit B (the “Notes”)
which shall be convertible on the terms stated therein into equity securities of the Company. The
Notes and the equity securities issuable upon conversion thereof (and the securities issuable upon
conversion of such equity securities) are collectively referred to herein as the “Securities.”
AGREEMENT
In consideration of the mutual promises contained herein and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties to this Agreement agree as
follows:
1. Purchase and Sale of Notes.
(a) Sale and Issuance of Notes. Subject to the terms and conditions of this
Agreement, each Purchaser agrees to purchase at each Closing, and the Company agrees to sell
and issue to each Purchaser at such Closing, a Note in the principal amount set forth opposite
such Purchaser’s name for such Closing on Exhibit A to this Agreement. The purchase price of
each Note shall be equal to One Hundred Percent (100.00%) of the principal amount of such
Note. The Company’s aggregate proceeds from sale of the Note(s) shall not exceed Two Million
Dollars ($2,000,000). The Company’s agreements with each of the Purchasers are separate
agreements, and the sales of the Notes to each of the Purchasers are separate sales.
(b) Closing; Delivery.
(i) The initial purchase and sale of the Notes shall take place at such
time and place as the Company and the Purchasers mutually agree upon, orally or in writing, on
or before July 15, 2015 (which time and place are designated as the “Initial Closing”). The term
“Closing” shall apply to each closing hereunder unless otherwise specified herein.
(ii) At each Closing, the Company shall deliver to each Purchaser the
Note to be purchased by such Purchaser at such Closing against payment of the purchase price
therefor by check payable to the Company or wire transfer to a bank account designated by the
Company.

WEST259129440. 2 2
(iv) Following the Initial Closing, the Company may from time to time
sell additional Notes to such persons or entities who are “accredited investors” as such term is
defined in Rule 501(a) of Regulation D promulgated under the Securities Act (as defined below).
All such sales shall be made on the terms and conditions set forth in this Agreement. Effective
upon delivery of an executed copy of this Agreement, each such person or entity purchasing a
Note hereunder shall be deemed to be a “Purchaser” for all purposes under this Agreement.
(v) Such additional sales of Notes shall occur no later than Twenty
Four (24) Months after the Initial Closing.
2. Stock Purchase Agreement. Each Purchaser understands and agrees that the
conversion of the Notes into, and the sale and purchase of, equity securities of the Company may
require such Purchaser’s execution of certain agreements relating to the purchase and sale of
such equity securities, and each such Purchaser agrees to execute and deliver such agreements as
shall be reasonably requested by the Company.
3. Representations and Warranties of the Company. The Company hereby
represents and warrants to each Purchaser as of the Initial Closing that:
(a) Organization, Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to carry on its business as now
conducted and as proposed to be conducted. The Company is duly qualified to transact business
and is in good standing in each jurisdiction in which the failure to so qualify would have a
material adverse effect on the business, assets, liabilities, financial condition, property or results
of operation of the Company.
(b) Authorization. All corporate action on the part of the Company, its
officers, directors and stockholders necessary for the authorization, execution and delivery of this
Agreement and the authorization, sale, issuance and delivery of the Notes, and the performance
of all obligations of the Company under this Agreement and the Notes, has been taken or will be
taken prior to the Initial Closing. The Agreement and the Notes, when executed and delivered by
the Company, shall constitute valid and legally binding obligations of the Company, enforceable
against the Company in accordance with their terms except as limited by (i) applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and other laws of
general application affecting enforcement of creditors’ rights generally and (ii) laws relating to
the availability of specific performance, injunctive relief, or other equitable remedies.
(c) No Conflicts. The execution and delivery of this Agreement and the
Notes and the performance by the Company of its obligations hereunder and thereunder will not
(a) result in any violation of any term of its Articles of Incorporation or Bylaws or any material
agreement or material obligation of the Company, (b) be in conflict with or constitute a default
under any of the foregoing and will not result in the creation of any mortgage, pledge, lien,
encumbrance or charge upon any of the properties or assets of the Company pursuant to the
foregoing, (c) violate any statute or law or any judgment, decree, order, regulation or rule of any
court or governmental authority to which the Company or its properties is bound or subject, or

WEST259129440. 2 3
(d) require notice to or consent of any party to any agreement or commitment to which the
Company is a party.
(d) Compliance with Other Instruments. The Company is not in violation
or default (a) of any provisions of its Articles of Incorporation or Bylaws, (b) of any judgment,
order, writ or decree of any court or governmental entity, or (c) to its knowledge, of any
provision of federal or state statute, rule or regulation materially applicable to the Company.
(e) Subsidiaries. The Company does not currently own or control, directly or
indirectly, any interest in any other corporation, partnership, trust, joint venture, limited liability
company, association, or other business entity. The Company is not a participant in any joint
venture, partnership or similar arrangement.
(f) Litigation. There is no pending action, suit, proceeding, arbitration,
mediation, complaint, claim, charge or investigation before any court, arbitrator, mediator or
governmental body, or to the Company’s knowledge, currently threatened in writing (i) against
the Company or (ii) against any consultant, officer, director or key employee of the Company
arising out of his or her consulting, employment or board relationship with the Company or that
could otherwise materially impact the Company.
(g) Title to Property and Assets. The Company owns its properties and
assets free and clear of all mortgages, deeds of trust, liens, encumbrances and security interests
except for statutory liens for the payment of current taxes that are not yet delinquent and liens,
encumbrances and security interests which arise in the ordinary course of business and which do
not affect material properties and assets of the Company. With respect to any property and
assets it leases, the Company is in material compliance with each such lease.
(h) Material Liabilities. The Company has no liability or obligation,
absolute or contingent (individually or in the aggregate), except (i) obligations and liabilities
incurred after the date of incorporation in the ordinary course of business that are not material,
individually or in the aggregate, and (ii) obligations under contracts made in the ordinary course
of business that would not be required to be reflected in financial statements prepared in
accordance with generally accepted accounting principles.
(i) Securities Law Exemptions. Based in part on the accuracy of the
representations and warranties of the Purchasers contained in Section 4 hereof, the offer, sale and
issuance of the Securities are and will be exempt from the registration requirements of the
Securities Act, and the registration, permit or qualification requirements of any applicable state
securities laws. Neither the Company nor any agent on its behalf has solicited or will solicit any
offers to sell or has offered to sell or will offer to sell any part of the Securities to any person or
persons so as to bring the sale of such Securities by the Company within the registration
provisions of the Securities Act or any state securities law.
(j) Permits. The Company has all franchises, permits, licenses, and any
similar authority necessary for the conduct of its business as now being conducted by it, the lack
of which would have a material adverse effect on the Company, and believes it can obtain,
without undue burden or expense, any similar authority for the conduct of its business as

WEST259129440. 2 4
presently planned to be conducted. The Company is not in default in any material respect under
any of such franchises, permits, licenses or other similar authority.
4. Representations and Warranties of the Purchasers. Each Purchaser hereby
represents and warrants to the Company that:
(a) Purchase Entirely for Own Account. The Securities to be acquired by
the Purchaser will be acquired for investment for the Purchaser’s own account, not as a nominee
or agent, and not with a view to the resale or distribution of any part thereof, and the Purchaser
has no present intention of selling, granting any participation in, or otherwise distributing the
same. The Purchaser has not been formed for the specific purpose of acquiring any of the
Securities.
(b) Knowledge. The Purchaser is aware of the Company’s business affairs
and financial condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Securities.
(c) Restricted Securities. The Purchaser understands that the Securities have
not been, and will not be, registered under the Securities Act of 1933, as amended (the
“Securities Act”), by reason of a specific exemption from the registration provisions of the
Securities Act which depends upon, among other things, the bona fide nature of the investment
intent and the accuracy of the Purchaser’s representations as expressed herein. The Purchaser
understands that the Securities are “restricted securities” under applicable U.S. federal and state
securities laws and that, pursuant to these laws, the Purchaser must hold the Securities
indefinitely unless they are registered with the Securities and Exchange Commission and
qualified by state authorities, or an exemption from such registration and qualification
requirements is available. The Purchaser acknowledges that the Company has no obligation to
register or qualify the Securities for resale. The Purchaser further acknowledges that if an
exemption from registration or qualification is available, it may be conditioned on various
requirements including, but not limited to, the time and manner of sale, the holding period for the
Securities, and on requirements relating to the Company which are outside of the Purchaser’s
control, and which the Company is under no obligation and may not be able to satisfy.
(d) No Public Market. The Purchaser understands that no public market now
exists for any of the securities issued by the Company and that the Company has made no
assurances that a public market will ever exist for the Securities.
(e) Legends. The Purchaser understands that the Securities, and any
securities issued in respect thereof or exchange therefor, may bear one or all of the following
legends:
(i) “THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR
DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM

WEST259129440. 2 5
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.”
(ii) Any legend required by the Blue Sky laws of any state to the
extent such laws are applicable to the securities so legended.
(f) Accredited Investor. The Purchaser is an accredited investor as defined
in Rule 501(a) of Regulation D promulgated under the Securities Act.
(g) Foreign Investors. If the Purchaser is not a United States person (as
defined by Rule 902(k) under the Securities Act), such Purchaser hereby represents that it has
satisfied itself as to the full observance of the laws of its jurisdiction in connection with any
invitation to subscribe for the Securities or any use of this Agreement, including (i) the legal
requirements within its jurisdiction for the purchase of the Securities, (ii) any foreign exchange
restrictions applicable to such purchase, (iii) any governmental or other consents that may need
to be obtained and (iv) the income tax and other tax consequences, if any, that may be relevant to
the purchase, holding, redemption, sale or transfer of the Securities. Such Purchaser’s
subscription and payment for, and such Purchaser’s continued beneficial ownership of the
Securities, will not violate any applicable securities or other laws of such Purchaser’s
jurisdiction. Such Purchaser also hereby represents that such Purchaser is not a “10-percent
shareholder” as defined in Section 871(h) of the Internal Revenue Code of 1986, as amended.
5. Conditions of the Purchasers’ Obligations at Closing. The obligations of each
Purchaser to the Company under this Agreement are subject to the fulfillment, on or before the
applicable Closing, of each of the following conditions, unless otherwise waived:
(a) Representations and Warranties. The representations and warranties of
the Company contained in Section 3 shall be true in all material respects on and as of the Initial
Closing with the same effect as though such representations and warranties had been made on
and as of the date of the Initial Closing.
(b) Qualifications. All authorizations, approvals or permits, if any, of any
governmental authority or regulatory body of the United States or of any state that are required in
connection with the lawful issuance and sale of the Notes pursuant to this Agreement shall be
obtained and effective as of the Closing.
6. Conditions of the Company’s Obligations at Closing. The obligations of the
Company to each Purchaser under this Agreement are subject to the fulfillment, on or before the
applicable Closing, of each of the following conditions, unless otherwise waived:
(a) Representations and Warranties. The representations and warranties of
each Purchaser contained in Section 4 shall be true in all material respects on and as of the
Closing with the same effect as though such representations and warranties had been made on
and as of the Closing.
(b) Qualifications. All authorizations, approvals or permits, if any, of any
governmental authority or regulatory body of the United States or of any state that are required in

WEST259129440. 2 6
connection with the lawful issuance and sale of the Notes pursuant to this Agreement shall be
obtained and effective as of the Closing.
7. Lock-Up Agreement. In connection with the initial public offering of the
Company’s securities and upon request of the Company or the underwriters managing any
underwritten offering of the Company’s securities, Purchaser agrees not to sell, make any short
sale of, loan, grant any option for the purchase of, or otherwise dispose of any equity securities
of the Company, however or whenever acquired (other than those included in the registration)
without the prior written consent of the Company or such underwriters, as the case may be, for
such period of time (not to exceed 180 days) from the effective date of such registration as may
be requested by the Company or such managing underwriters and to execute an agreement
reflecting the foregoing as may be requested by the underwriters at the time of the public
offering.
8. Miscellaneous.
(a) Successors and Assigns. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors and assigns of the
parties. Nothing in this Agreement, express or implied, is intended to confer upon any party
other than the parties hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as expressly provided in
this Agreement.
(b) Governing Law. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed, construed and
interpreted in accordance with the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
(c) Counterparts. This Agreement may be executed in two or more counter-
parts, each of which shall be deemed an original and all of which together shall constitute one
instrument. This Agreement may also be executed and delivered by facsimile or other electronic
delivery of signature.
(d) Titles and Subtitles. The titles and subtitles used in this Agreement are
used for convenience only and are not to be considered in construing or interpreting this
Agreement.
(e) Notices. Any notice required or permitted by this Agreement shall be in
writing and shall be deemed sufficient upon receipt, when delivered personally or by courier,
overnight delivery service or confirmed facsimile, or forty-eight (48) hours after being deposited
in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to
the party to be notified at such party’s address or facsimile number as set forth on the applicable
signature page or Exhibit A hereto or as subsequently modified by written notice.
(f) Finder’s Fee. Each Purchaser agrees to indemnify and to hold harmless
the Company from any liability for any commission or compensation in the nature of a finder’s
fee (and the costs and expenses of defending against such liability or asserted liability) for which
each Purchaser or any of its officers, employees, or representatives is responsible.

WEST259129440. 2 7
(g) Amendments and Waivers. Any term of this Agreement may be
amended or waived only with the written consent of the Company and the holders of a majority
of the aggregate principal amount of the Notes then outstanding. Any amendment or waiver
effected in accordance with this Section 8(g) shall be binding upon the Purchasers and each
transferee of the Securities, each future holder of all such Securities, and the Company.
(h) Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, the parties agree to renegotiate such provision in good faith,
in order to maintain the economic position enjoyed by each party as close as possible to that
under the provision rendered unenforceable. In the event that the parties cannot reach a mutually
agreeable and enforceable replacement for such provision, then (i) such provision shall be
excluded from this Agreement, (ii) the balance of the Agreement shall be interpreted as if such
provision were so excluded and (iii) the balance of the Agreement shall be enforceable in
accordance with its terms.
(i) Entire Agreement. This Agreement, and the documents referred to
herein, constitutes the entire agreement between the parties hereto pertaining to the subject
matter hereof, and any and all other written or oral agreements existing between the parties
hereto are expressly canceled.
(j) Exculpation Among Purchasers. Each Purchaser acknowledges that it is
not relying upon any person, firm or corporation, other than the Company and its officers and
directors, in making its investment or decision to invest in the Company. Each Purchaser agrees
that no Purchaser nor the respective controlling persons, officers, directors, partners, agents, or
employees of any Purchaser shall be liable for any action heretofore or hereafter taken or omitted
to be taken by any of them in connection with the Securities.
(Signature pages follow)

[Signature Page to Convertible Promissory Note Purchase Agreement]
The parties have executed this Convertible Promissory Note Purchase Agreement as of
the date first written above.
COMPANY:
LOANATIK, INC.
By:
Corey Schwartz, President
Address:
8520 East Shea Blvd, #115
Scottsdale, AZ 85260

[Signature Page to Convertible Promissory Note Purchase Agreement]
The parties have executed this Convertible Promissory Note Purchase Agreement as of
the date first written above.
PURCHASER:
IF AN ENTITY:
(Name of Entity – Please Print)
By:
Name:
Title:
IF AN INDIVIDUAL:
(Name – Please Print)
(Signature)

EXHIBIT A
SCHEDULE OF PURCHASERS
Purchaser Principal Amount Date of Purchase
Total: $

EXHIBIT B
FORM OF CONVERTIBLE PROMISSORY NOTE
(See Attached)

WEST259127423.3
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNEC-
TION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR
DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER THE SECURITIES ACT OF 1933.
$______________ _______________, 2015
Phoenix, Arizona
For value received, Loanatik, Inc., a Delaware corporation (the “Company”),
promises to pay to ____________ (the “Holder”), the principal sum of
_______________________________ Dollars ($ _______________). Interest shall
accrue from the date of this Note on the unpaid principal amount at a rate equal to Six
Percent (6%) per annum, compounded annually. This Convertible Promissory Note (this
“Note”) is one of a series of Convertible Promissory Notes containing substantially
identical terms and conditions issued pursuant to that certain Convertible Promissory
Note Purchase Agreement dated July 14, 2015 (“Purchase Agreement”). Such Notes are
referred to herein as the “Notes,” and the holders thereof are referred to herein as the
“Holders.” This Note is subject to the following terms and conditions.
1. Maturity. Subject to Section 2, the Note Balance (defined below) shall be
due and payable upon demand by the Holder at any time after the second (2nd)
anniversary of issuance. Notwithstanding the foregoing, the entire outstanding principal
balance and any accrued but unpaid interest under this Note (“Note Balance”) shall
become immediately due and payable upon (a) the circumstances set forth in Section 3, or
(b) the insolvency of the Company, the execution by the Company of a general
assignment for the benefit of creditors, the filing by or against the Company of a petition
in bankruptcy or any petition for relief under the federal bankruptcy act and the
continuation of such petition without dismissal for a period of ninety (90) days or more,
or the appointment of a receiver or trustee to take possession of the property or assets of
the Company.
2. Conversion.
(a) Next Equity Financing. The Note Balance shall be converted into
shares of the Company’s equity securities (the “Equity Securities”) issued and sold at the
close of the Company’s next equity financing in a single transaction or a series of related
transactions yielding gross proceeds to the Company of at least Four Million Dollars
($4,000,000) in the aggregate (including the aggregate outstanding principal balance and
interest of this Note and other promissory notes being converted into Equity Securities)

-2-
WEST259127423.3
(the “Next Equity Financing”). The number of shares of Equity Securities to be issued
upon such conversion shall be equal to the quotient obtained by dividing (i) the Note
Balance at the time of conversion by (ii) Eighty Percent (80%) of the price per share of
the Equity Securities paid by investors paying cash at the closing of the Next Equity
Financing (the “Note Conversion Price”), rounded to the nearest whole share. The
issuance of such shares upon such conversion shall be upon the terms and subject to the
conditions applicable to the Next Equity Financing.
(b) Valuation Cap. In the event the Note Conversion Price exceeds
the quotient (“Capped Conversion Price”) obtained by dividing (i) Seven Million Dollars
($7,000,000) by (ii) the sum of (1) the total number of shares of Common Stock
outstanding (assuming full conversion and exercise of all convertible or exercisable
securities other than the Notes and any other outstanding convertible notes) and (2) shares
of Common Stock reserved for issuance to employees, consultants or directors pursuant
to a stock option plan, restricted stock plan, or other stock plan approved by the
Company’s Board of Directors, then in addition to the shares of Equity Securities issuable
under Section 2(a), the Holder shall also be issued that number of shares of Common
Stock equal to (i) the quotient obtained by dividing the Note Balance at the time of
conversion by the Capped Conversion Price, less (ii) the number of Equity Securities
issuable under Section 2(a).
3. Change of Control. If, prior to the Next Equity Financing, there occurs a
merger or consolidation of the Company, sale or licensing of all or substantially all of the
assets of the Company, or other transaction a result of which the equity holders of the
Company immediately prior to such merger, consolidation, sale, license or other
transaction do not own, immediately following the consummation thereof, a majority of
the voting power of the surviving or acquiring entity on account of their equity interests
in the Company immediately prior to such transaction (a “Sale of the Company”), then
the Note Balance of each Note shall be repaid, in an amount equal to (a) the Note Balance
of such Note, plus (b) 50% of the original principal amount of such Note upon the closing
of such Sale of the Company, in full discharge of all indebtedness and other obligations
under this Note. Before Holder shall be entitled to receive payment pursuant to this
paragraph, the Holder shall surrender this Note, duly endorsed, at the principal offices of
the Company or any transfer agent of the Company.
4. Mechanics and Effect of Conversion. No fractional shares of the
Company’s capital stock will be issued upon conversion of this Note. In lieu of any
fractional share to which the Holder would otherwise be entitled, the Company will pay
to the Holder in cash the amount of the unconverted principal and interest balance of this
Note that would otherwise be converted into such fractional share. Upon conversion of
this Note pursuant to Section 2, the Holder shall surrender this Note, duly endorsed, at the
principal offices of the Company or any transfer agent of the Company. At its expense,
the Company will, as soon as practicable thereafter, issue and deliver to such Holder, at
such principal office, a certificate or certificates for the number of shares to which such
Holder is entitled upon such conversion, together with any other securities and property to
which the Holder is entitled upon such conversion under the terms of this Note, including

-3-
WEST259127423.3
a check payable to the Holder for any cash amounts payable as described herein. Upon
conversion of this Note, the Company will be forever released from all of its obligations
and liabilities under this Note with regard to that portion of the principal amount and
accrued interest being converted including without limitation the obligation to pay such
portion of the principal amount and accrued interest. Upon conversion of this Note, the
Holder hereby agrees to execute and deliver to the Company all transaction documents
reasonably requested by the Company, which will include the transaction documents
executed by the new investors in the Next Equity Financing.
5. Payment. All payments shall be made in lawful money of the United
States of America at such place as the Holder hereof may from time to time designate in
writing to the Company. Payment shall be credited first to the accrued interest then due
and payable and the remainder applied to principal. Prepayment of this Note may be made
at any time without penalty with written consent of a majority in interest of the Holders,
provided that all of the Notes shall be prepaid on a pro rata basis.
6. Priority. The Notes will be unsecured and subordinated in payment to
any senior indebtedness (e.g., indebtedness for borrowed money from institutional lenders
and lease financings) the Company may have or incur in the future.
7. Transfer; Successors and Assigns. The terms and conditions of this
Note shall inure to the benefit of and be binding upon the respective successors and
assigns of the parties. Notwithstanding the foregoing, the Holder may not assign, pledge,
or otherwise transfer this Note without the prior written consent of the Company. Subject
to the preceding sentence, this Note may be transferred only upon surrender of the
original Note for registration of transfer, duly endorsed, or accompanied by a duly
executed written instrument of transfer in form satisfactory to the Company. Thereupon,
a new note for the same principal amount and interest will be issued to, and registered in
the name of, the transferee. Interest and principal are payable only to the registered
holder of this Note.
8. Governing Law. This Note and all acts and transactions pursuant hereto
and the rights and obligations of the parties hereto shall be governed, construed and
interpreted in accordance with the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
9. Notices. Any notice required or permitted by this Note shall be in writing
and shall be deemed sufficient upon delivery, when delivered personally or by a
nationally-recognized delivery service (such as Federal Express or UPS), or forty-eight
(48) hours after being deposited in the U.S. mail, as certified or registered mail, with
postage prepaid, addressed to the party to be notified at such party’s address as set forth
below or as subsequently modified by written notice.
10. Amendments and Waivers. Any term of this Note may be amended only
with the written consent of the Company and the holders of a majority of the aggregate
principal amount of the Notes then outstanding. Any amendment or waiver effected in

-4-
WEST259127423.3
accordance with this paragraph shall be binding upon the Company, the Holders and each
transferee of the Notes.
11. Shareholders, Officers and Directors Not Liable. In no event shall any
shareholder, officer or director of the Company be liable for any amounts due or payable
pursuant to this Note.
12. Entire Agreement. This Note, together with the Purchase Agreement and
the documents referred to therein, constitutes the entire agreement and understanding
between the Company and the Holder relating to the subject matter herein and supersedes
all prior or contemporaneous discussions, understandings and agreements, whether oral or
written between them relating to the subject matter hereof.
13. Counterparts. This Note may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an original, and all of
which together shall constitute one and the same instrument.
COMPANY:
LOANATIK, INC.
By: ___________________________
Corey Schwartz, President
Address:
8520 East Shea Blvd, #115
Scottsdale, AZ 85260
AGREED TO AND ACCEPTED:
By: ___________________________
Name:
Address:
_______________________________
_______________________________

Loanatik Streamlines Mortgage Process

Recomendados

Recomendados

Más contenido relacionado

La actualidad más candente

La actualidad más candente (20)

Destacado

Destacado (12)

Similar a Loanatik Streamlines Mortgage Process

Similar a Loanatik Streamlines Mortgage Process (20)

Último

Último (20)

Loanatik Streamlines Mortgage Process