Prime Meridian Capital Management, LLC · Jeremy Todd has over 20 years of financial services experience in management, sales, and marketing covering asset managers, h edge funds,

Prime Meridian Capital Management, LLC

This overview is for information purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any interests in Prime Meridian IncomeFund, LP, Prime Meridian Small Business Lending Fund, LP, Prime Meridian Real Estate Lending Fund, LP, Prime Meridian Special Opportunities Fund, LP (the“Fund”), or any other securities. Any such offer will be made only pursuant to the Fund’s Private Offering Memorandum. This overview may include or be basedin part on projections, valuations, estimates and other financial data supplied by third parties, which has not been verified by Prime Meridian CapitalManagement, LLC. This information should not be relied upon for the purpose of investing in the funds or for any other purpose. Any information regardingprojected or estimated investment returns are estimates only and should not be considered indicative of the actual results that may be realized or predictive ofthe performance of the funds. Past investment results of the funds should not be viewed as indicative of future performance of the funds. Any such offering ofthe funds will be made only in accordance with the terms and conditions set forth in the Fund’s Private Offering Memorandum. Prior to investing, investors arestrongly urged to review carefully the Private Offering Memorandum (including the risk factors described therein), the Limited Partnership Agreement and theSubscription Documents, to ask such questions of the Investment Manager as they deem appropriate, and to discuss any prospective investment in the fundswith their legal and tax advisers in order to make an independent determination of the suitability and consequences of an investment. Investment in the funds issuitable only for sophisticated investors for whom an investment in the funds does not constitute a complete investment program and who fully understand, andare willing to assume, the risks involved in an investment in the funds. No person has been authorized to give any information or to make any representation,warranty, statement or assurance may not be relied upon. The offering of interests in the funds will be made in reliance upon an exemption from registrationunder the United State Securities Act of 1933, as amended, for offers and sales of securities that do not involve a public offering. No public or other market willdevelop for the interests, and the interests are not generally otherwise transferable. The funds will not be registered as an investment company under the U.S.Investment Company Act of 1940, as amended (the “Investment Company Act”), and each purchaser of interests in the funds must be an “accredited investor”as defined in the Investment Company Act. Prospective investors should inform themselves and take appropriate advice as to any applicable legal requirementsand any applicable taxation and exchange control regulations in the countries of their citizenship, residence or domicile which might be relevant to the purchase,holding or redemption of interests. The information provided in this overview is not and should not be considered a recommendation to purchase or sell anyparticular security. Past performance of the funds is not a guide to future performance. The potential for profit is accompanied by the possibility of loss,including the possibility of a total loss. Performance information is presented net of all expenses, including management fees, performance fees and otherexpenses including portfolio-related expenses. Returns assume the reinvestment of all capital (including distributions where applicable) on a monthly basis.Investors should be aware that a total loss of principal may occur. No part of this material may be (i) copied, photocopied or duplicated in any form, by anymeans, or (ii) redistributed without Prime Meridian Capital Management, LLC’s prior written consent.

Important Notice

1Strictly Confidential – Not for Distribution or Duplication

Company OverviewOverview

Prime Meridian Capital Management is an alternativecredit SEC Registered Investment Advisor based in the SanFrancisco Bay Area (Walnut Creek, CA) with ~$483 millionin assets under management as of December 31st, 2019.

Prime Meridian offers investors different short-duration,high yield marketplace lending funds with the followingverticals - consumer lending, collateralized small businesslending, secured real estate lending, litigation finance, lifesettlements.

Our objective is to achieve consistent positive returns andoutperform other debt/fixed income portfolios by selectingloans using a proprietary risk-based pricing approach thatfocuses on yield, duration, and credit quality with lowvolatility and low correlation to other asset classes.

Each Fund is heavily diversified across prime borrowers andall hold a professionally managed pool of loans sourcedfrom multiple platforms.

Four Funds Across Multiple Verticals

Prime Meridian Income Fund, LP•Prime Consumer Lending•Inception: May 2012 • Returns: Over 6.5% annualized • Leverage: N/A

Prime Meridian Small Business Lending Fund, LP•Collateralized Small Business Lending•Inception: July 2014 • Returns: Over 7% annualized • Leverage: N/A

Prime Meridian Real Estate Lending Fund, LP•Short-term Secured Real Estate Lending•Inception: February 2016 • Returns: Over 8% annualized • Leverage: N/A

Prime Meridian Special Opportunities Fund, LP•Litigation Finance, Life Settlements, Specialty Credit •Inception: June 2018 • Returns: Over 9% annualized • Leverage: N/A

2Strictly Confidential – Not for Distribution or Duplication. Past Performance is not necessarily indicative of future results.

2004

2006

2007

2012

2014

2016

2018

Novus Investments, started by Don Davis, is formed specializing in

managed futures & other alternative programs

Prosper Funding

Lending Club

Prime Meridian Capital Management is formed

Prime Meridian Income Fund, LP launches

Prime Meridian Small Business

Lending Fund, LP

Prime MeridianReal Estate Lending

Fund, LP

Prime Meridian Special Opportunities Fund, LP

A Track Record of SuccessSince inception in 2012, Prime Meridian Capital Management has built a successful proven track record of managing a family of pure-play private debt income funds.

Institutions, Investment Managers, and Accredited Investors benefit from Prime Meridian’s segregated portfolios by being able to control the amount of exposure across each lending vertical without the worry of style-drift. As a result, investors are empowered with the option to be as diversified or concentrated as they see fit.


Don Davis, CEO and Portfolio Manager

Don Davis is a Managing Partner and the lead Portfolio Manager of Prime Meridian Capital Management, an investment management firm specializing in online P2P/marketplace lending strategies. As a seasoned industry veteran and skilled portfolio manager, Mr. Davis applies his knowledge, conservative management principles, and hands on expertise to the day-to-day management of the firm. Mr. Davis is also a principal of Novus Investments, LLC (“Novus”), a boutique alternative investment management firm, and was previously a top ranked futures trader in the U.S. for risk adjusted return over both a 5 and a 7 year period. Mr. Davis is a recognized speaker in the marketplace lending institutional investing space, being recently featured in Bloomberg, LendIt, American Bankers Association, Forbes, IMN, Emerging Manager Forum, AltInvest, LendAcademy, the P2P Lending Investing Summit, and John Lothian News. Mr. Davis resides in the San Francisco Bay area and is actively involved in local charities with a special interest in assisting disadvantaged children, the disabled, and veterans.

Val Katayev, Managing Partner

Val Katayev is a Managing Partner of Prime Meridian Capital Management, assisting with strategy, product development, platform selection and investor services. Mr. Katayev is a four-time tech entrepreneur who generated over $100 million in profits and exits before ever raising capital from outside investors. He is also one of the most experienced P2P/Marketplace Lending investors in the United States, and was one of the very first lenders at Prosper in early 2006. After seeing positive returns after the “Great Recession”, he has since invested substantially into the space, and is one of the largest individual investor in the Prime Meridian funds.

Team

Strictly Confidential – Not for Distribution or Duplication 4

Peter Lowden, CFA, Managing Director and Portfolio Manager

Peter Lowden, CFA, is the Managing Director and Co-Portfolio Manager for Prime Meridian Capital Management. In these roles, he is instrumental in the management of the lending funds for the firm, and its overall operations and direction. Mr. Lowden has been formulating and managing investment strategies since 1993. His experience includes traditional equity and fixed income securities analysis, traditional and alternative investment manager research, asset allocation, and portfolio management of equity, fixed income, mutual fund, fund of funds and hedge fund strategies. Mr. Lowden holds a Bachelor of Science degree in Finance from the University of Colorado, Boulder, as well as the Chartered Financial Analyst (CFA) designation from the CFA Institute. He is a past President of the CFA Miami Society, and is active in the community where he has helped guide multiple non-profit organizations.

Jeremy Todd, Head of Capital Markets

Jeremy Todd has over 20 years of financial services experience in management, sales, and marketing covering asset managers, hedge funds, institutional investors, broker dealers, and registered investment advisors. He is the Head of Capital Markets at Prime Meridian Capital Management. Previously he was the Head of West Coast and Asia Regions at two different fintech startups dv01 and Orchard Platform. He also spent 17 years in prime brokerage starting at Montgomery Securities, then was a managing director at Bear Stearns, started the prime brokerage division at The Bank of New York Mellon, and lastly at Barclays managing the west coast business. Jeremy earned a B.A. in philosophy from the University of California, Berkeley.

Sandra Garcia, Director of Operations

Mrs. Garcia is the Operations Manager for Prime Meridian Capital Management, and provides key functions in the Operations, Compliance, and Investor Relations areas. She is responsible for managing future and existing client relationships and working directly custodians including Wells Fargo, Fidelity, TD Ameritrade and Millennium Trust, etc. Prior to joining Prime Meridian/Novus Investments, Mrs. Garcia was a Senior Loan Processor for the Equiprime Mortgage Group. Earlier in her career, she served in a similar function for the First Fidelity Funding and Mortgage Corporation. Mrs. Garcia joined Prime Meridian/Novus in 2007, has a total of 13 years of experience in the finance industry and is Series 3 licensed.

Team


Rocco DiBenedetto, CPA, Operations Manager

Rocco DiBenedetto is the Operations Manager at Prime Meridian Capital Management, overseeing accounting and other daily functions. He is focused on developing automated processes to deliver an institutional grade service offering. Prior to joining Prime Meridian, Rocco worked at a Fund Administrator where he spent 7 years leading the accounting team and driving innovation. Rocco received his Bachelors of Science and Masters of Professional Accountancy in 2011 from Illinois State University, and received his CPA shortly after graduation.

Jeffrey Ordoñez-Triana, Director of Marketing

Jeffrey serves as the Director of Marketing for Prime Meridian Capital Management LLC assisting with new business development and relationship management. Previously, he assisted private companies in both the US and China raise over $300 million in capital through private placements as an Institutional Salesperson at Kuhns Brothers Securities and JFP Holdings Ltd. Prior to Kuhns Brothers, he was a VP of Institutional Sales and Trading at SecondMarket, which is the largest secondary marketplace for private company stock. Earlier in his career, he was a top producing wealth manager at Morgan Stanley. Jeffrey graduated from Boston University with a BSBA in International Finance. He holds Series 7, 63, and 24 licenses.

Milad Khajehnezhad, Senior Credit Risk Analyst

Milad is a Senior Credit Risk Analyst at Prime Meridian Capital Management. In this role, he is responsible for developing risk analytic frameworks, credit policies and guidelines. Prior to joining Prime Meridian, Mr. Khajehnezhad was a Senior Credit Modeler for the RealtyShares. Earlier in his career, he served as a Credit & Portfolio Risk Manager at CitiMortgage. His experience includes credit risk modeling and validation, loss forecasting, stress testing loan portfolios, regression models, time series analysis, and operations research modeling. Mr. Khajehnezhad holds a Master of Science degree in Industrial Engineering and Operation Research from the University of Wisconsin Milwaukee.

Team


Justin Small, Senior Analyst

Justin Small is a Senior Analyst for Prime Meridian Capital Management. In this role, Justin conducts research and analysis on the lending industry and platforms, as well as assists in various operational aspect of the firm. Prior to joining Prime Meridian Capital Management, Mr. Small held various roles in specialty investment management and banking. Mr. Small holds a Bachelor of Science in Finance from the University of San Francisco. In his free time, he enjoys finding new investment ideas, attending keynote speeches relating to the financial markets and the economy, and participating in several worthy programs such as after school tutoring for disadvantaged children.

Serena Pham, Investor Relations Associate

Serena Pham is an Investor Relations Associate at Prime Meridian Capital Management. In this role, Serena both services existing clients and helps establish new client relationships for the firm. Additionally, she helps manage the marketing functions at the firm. Previous to Prime Meridian, she was an Inside Sales Account Representative at Uber. Serena earned a Bachelors of Science in Business Administration with a concentration in marketing from the University of San Francisco. In her free time, she enjoys traveling, cooking, hiking, and playing sports including volleyball and basketball.

Ed Zimmermann, Analyst

Ed is an Analyst at Prime Meridian Capital Management where he assists in the operations and analysis of portfolio management functions including lending platform due diligence. In his spare time, Ed enjoys reading, watching basketball and hiking. Ed graduated from University of California, San Diego with B.A.s in Economics & History and is a CFA level II candidate.

Alex Cariaso, Operations Assistant

Alex Cariaso is the Operations Assistant at Prime Meridian Capital Management. In this role, Alex is assisting the firm with administrative duties, office procedures and client database updates. Previous to Prime Meridian, he has had 27 years of experience in mortgage as an Underwriting Specialist for Franklin American Mortgage, Marketing Coordinator for National City Mortgage and Secondary Marketing for Courtesy Funding. In his free time, Alex enjoys watching movies, going to concerts, listening to music, but he mostly enjoys traveling to different countries with his wife.

Team


LendIt 2017 Top Fund ManagerPrime Meridian was presented the Leading Fund Manager award fordemonstrated vision and commitment to the online lending sector, whiledelivering outstanding performance.

2019 Inc. 5000Inc. Magazine ranked Prime Meridian Capital Management 478 on its2019 Annual Inc. 5000 list, which ranks the fastest growing private UScompanies in all industries.

San Francisco Business Times 2018 fast 100Prime Meridian Capital Management has been ranked 6 by the SanFrancisco Business Times on the 27th annual Fastest Growing PrivateCompanies.

Recognition

For links to each award, please visit the Awards Page at www.pmifunds.com


Benefits of Investing with Prime Meridian

“Since the inception of Prime Meridian, we have always maintained a disciplined investment focus in order to provide investors access to curated, short-duration, high-yield income generating products.

We committed to being a client-centric organization with superior service and attention to all our limited partners."

- Don Davis, CEO & Managing Partner

Top Tier Marketplace Lending Investor in AUM, Performance, & Track Record Length

Experienced Investment Team with Over 90 Years Collective Experience

Access to Multiple Vertical Marketplace Lending Funds Each With Own Credit Model

Extensive Investments in over 12 Quality Lending Originators and 100,000+ Loans

Low Volatility and Low Correlation Compared to other Investments

Loans Structured Through Bankruptcy Remote Vehicles – Entirely Separate from Lender Platforms

Proven Risk Management Expertise Mitigating Counterparty, Credit, Portfolio Diversification, Leverage Risks, and Minimizing Cash Drag

Robust Institutional Quality Infrastructure Offering Better Safety and Soundness of Assets Including Partnering with Prominent Third-Party Service Providers in All Operational Aspects Including Administration, Custody, & Valuation Services


Unlike other asset management firms, Prime Meridian offers investment managers and accredited investors access toshort duration, high yield multiple portfolios for those looking for greater portfolio diversification and control over theamount of exposure to each vertical.

Multiple Funds to Maximize Diversification

Prime Meridian Special Opportunities Fund, L.PLitigation Finance, Life Settlements,

& other niche opportunities

Prime Meridian Small Business Lending Fund, L.PSmall business lending

Prime Meridian Real Estate Lending Fund, L.P.First lien diversified bridge lending

Prime Meridian Income Fund, L.P.Consumer lending


Risk Management Process

Comprehensive due diligence with management teams, reviewing operational processes Analyzing financial stability of the firm

Step 1: Counterparty Risk Assessment on Lending Origination Platform

• Deep understanding of credit underwriting practices • Thorough review of historical loan performance and projected future performance

Step 2: Thorough Analysis of Lending Origination Platform Credit Underwriting

• PMCM’s creates an overlay credit model on top the lending origination platforms to identify loans with the lowest expected default rates

• Revise models on consistent basis using AI learning tools

Step 3: Build Proprietary PMCM Credit Model for Each Applicable Lending Origination Platform

• Construct portfolios per vertical across multiple lending origination platforms for maximum diversification• Investments made through whole loan purchases, lines of credit, bond purchases, and secondary whole

loan transaction• Minimize risk by diversifying loan characteristics across geographies, borrower, business, and property

types, and multiple other factors

Step 4: Meticulous Portfolio Construction


Risk Management ProcessLoan Origination Process Conducted By Lending Origination Platforms

Targeting and credit policy determine who is approved and at what expected loss rate

Underwriting process verifies borrower information Tracking and analysis of performance establishes feedback loop to improve

quality of models Continuously looking for arbitrage pockets and eliminating them

Measure Performance

vs.Expectations

Identify Segment

Variances and Drivers

Originate Loans

Adjust Policy, Product, Pricing

Inbound Inquiry

• Direct-to-site• Affiliates/partners• Direct mail

Data Collection

• Borrower data• Bureau pull

Credit Scoring

• Proprietary scorecard• Additional adjustments• Rating assigned

Verification

• Verify identity• Verify address• Fraud screen• Verify bank account• Verify employment on

majority of loans

Servicing

• Lender statements• Payment processing• Customer relations

Collections

• 1-15 dpd: Internal• 16+ dpd: External• 120 day charge-off

policy• Post c/o: External


Borrowers

Consumer LoansSmall Business LoansReal Estate Loans InvestorsOrigination

FeesServicing

Fee

• Instant Loan Approval / Rejection• Consistent Underwriting• Risk-Based Pricing• Little-to-No Operational Pain Points• National vs. Regional Reach

Commercial BanksPension & Endowments

Independent Wealth ManagersSingle and Multi-Family Offices

Fund of Funds

Underserved markets accessing needs-based loans

The Value of Online Lending

Platforms


Individual Investors

~ 30% of Loan Market*

Institutional Investors

~ 70% of Loan Market*

• Source: Prime Meridian Estimate

- Self-Directed via Platform Access

- Banks- Hedge Funds- Endowments & Pensions

Marketplace Lending Investors


Appendix A: Consumer LendingPrime Meridian Income Fund, LP


Current Market Size*

$3.8 TrillionAddressable

Market**

$995 BillionP2P

Peer-to-Peer LendingCurrently ~ $20 billion out of $995 billion

* Consists of consumer credit card debt and installment loans and does not include loans secured by real estate.** Consists of revolving consumer debt outstandingSource: Federal Reserve

• Well-established market. Consumer credit data starts in Q4 1945• Current market size excludes home related debt• Small loan size. Average loan is < $15K• Primary demographic user of consumer credit is 30-44 years old

Consumer credit has been a large, consistently profitable asset class - equivalent to the sixth-largest GDP in world. Investmentmanagers looking to take advantage of the benefits of technology and consistent positive returns observed in unsecured consumerlending, Prime Meridian offers access to three private fund structures which are heavily diversified across prime-grade borrowers.

The Consumer Lending Opportunity


Credit Card Securitization Data – The Historical Experience

© 2017 Prosper. All Rights Reserved. Proprietary and Confidential.

Consumer Lending – A Historical Perspective


Investors face a difficult environment

• Likelihood of suppressed future economic growth

• Portends low returns and high volatility for most asset classes

• Fixed income offers little yield and a lot of duration risk

• Cash has a negative return

Borrowers face a difficult environment

• Uncooperative, archaic lending institutions

• Restricted, limited access to capital

• Slow decision making and inefficient user experience at traditional brick-and-mortar banks

Solving the Central Problems

We are committed to only working with thelargest, most established, and well capitalizedonline lenders in the industry such as Prosperand Lending Club.

Because of our early adoption in themarketplace lending space – investors benefitfrom our deep longstanding relationships withexecutive teams across all our partner platformsand cumulative experience in risk-management.


Prosper launched America’s first peer-to-peer lending platform in 2006 with a simple mission - to provide an alternative to traditionalbank lending and to allow people to invest in each other, which is both financially and socially rewarding

• Prosper pioneered the development of this asset class• Prosper has over 2 million members and has funded over $10 billion in loans as of Q3 2017• Prosper is backed by some of the world’s biggest investors including Blackrock, Sequoia Capital, Francisco Partners and Benchmark Capital• Average Prosper borrower shows the following characteristics

˃ FICO Score: 705˃ Personal Income: $80k+˃ Interest Rate Range: 6.6% - 31.80%

About Prosper and Lending Club

Lending Club initially launched in 2007, first offering borrowers access to 36-month, fixed term fully amortizing loans followed by accessto 60-month term loans in 2010. The majority of borrowers come to Lending Club seeking loans for major purchases, debtconsolidation, and home improvements.• Lending Club is publicly traded under symbol “LC”• Average Lending Club borrower shows the following characteristics

˃ FICO Score: 680+˃ Personal Income: $74k+˃ Interest Rate Range: 5.3% - 30.99%


Appendix B: Small Business LendingPrime Meridian Small Business Lending Fund, LP


The Prime Meridian Small Business Lending Fund, LP (“SBL”) provides investors access to short duration, high-yield small business loans while minimizing volatility of returns and correlation to other asset classes. The fund is diversified across prime-grade borrowers geographically spread across the US.

• SBL was launched in July of 2014 and actively manages and invests in Marketplace small business loans

• SBL has loan purchase and servicing agreements in place with Funding Circle, Lending Club and Biz2credit, in addition to access to all of the leading online lending small business loan origination platforms

• SBL has created a proprietary loan selection model (API) that scans all loans marketed by the platforms and eliminates from consideration those loans that it believes have a higher likelihood of default

• Loan purchases are executed to create a broadly diversified portfolio comprising what we believe are the best risk/reward loans

SBL is invested in thousands of small business loans with terms ranging from 6 to 60 months

The Small Business Lending Opportunity


Small Business Lending

APR

50%

40%

30%

20%

10%

$100k $250k $500k Loan Amount

Alternative Lenders

APR: ~ 55%Terms: 6-12 months

Loan: $30k

Commercial Banking

APR: ~ 8%Terms: 5-10 yearLoan: $500k (+)

Addressable Market

Primary Use: Working Capital, CAPEXTarget Top-line Revenues: $200k-$2mm

Commercial Banks have drastically decreased lending to small-to-mid sizedbusinesses (SMB’s). Archaic operational processes and high underwriting costsmake SMB loans unattractive for large traditional financial institutions. Therefore,banks remain largely focused on the $1mm (+) loan origination market. Today,SMB’s seek solutions to their financing needs via online lenders; thus, providing aripe investment opportunity for investors in the Addressable Market.


Loan originations have been on the decline since the Great Recession. Today, traditional brick-and-mortar banks continue to dominate business lending for the $1mm (+) market while turning their attention away from small businesses. Because of this, online small business platforms have created opportunity for investors via seeking access to this underserved market. Prime Meridian partners with some of the major small business lenders such as Funding Circle, Lending Club Small Business, and Biz2Credit.

Small Business Lending

• Funding Circle is a Marketplace Lender for Small Businesses

• ~ $10bn originated globally since inception

• US loans range $25,000 to $500,000

• 6 month to 5 year terms, 4.99% to 28.79%

• ~ $715mm in equity capital raised

• As of May 2019, $931mm in loans originated since moving from brokerage to marketplace lender model

• 2018 Revenues of $34.9mm

• Biz2Credit has used technology to build a highly profitable rapidly growing marketplace lending business

• Fully digital end-to-end SMB lending platform

• Target Market: $200k to $2mm revenue

• 6% to 26% annualized

• US loans range $5,000 to $300,000

• 1 to 5 year terms (majority 1 to 3 years)

• Risk based pricing – 9 subgrades


Appendix C: Real Estate LendingPrime Meridian Real Estate Lending Fund, LP


Private real estate lending is a $1.5 trillion market, dominated by

banks and private lenders.

• Banks - policies and regulations make borrowing harder,

and the associated pace can often hinders deals

• Hard Money Lenders – Small, obscure, private lenders

have historically been the predominate provider of

capital to the small and mid-sized borrowers

Real Estate online marketplaces are a welcome funding solution

• More efficient underwriting than traditional banks

• Consistent, standardized, and repeatable quantitative underwriting

• Quick responses and Decision Making enabled

• Borrower friendly

Source: MONEY360

The Real Estate Lending Opportunity


Real Estate Lending – A Historical Perspective

1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

3.5%

3.0%

2.5%

2.0%

1.5%

1.0%

0.5%

0%

Charge-off Rate on Single Family Residential Mortgages, Booked in Domestic Offices, All Commercial Banks

Charge-off Rate on Commercial Real Estate Loans (Excluding Farmland), Booked in Domestic Offices, All Commercial Banks

Despite the 2001 Recession and 2008 Great Recession, real estate loan charge-offs remained relatively low. Thisbuilds a strong case for taking advantage of the high rates observed in short-term bridge lending.

Source: Federal Reserve Board 2017


MF’s, REITS (Public, Private)

• Opaque• High Fee• Less Diversification• Liquidity Constraints• High Correlation to Public Markets

Direct Investment • Requires Large Sums of Money• Forces Regional Concentration• Requires Ongoing

Monitoring/Maintenance(self-directed, outsourced)

Investor Pain-Points

CommercialBanks

• Policy, Regulation Hurdles• Lengthy Decision Making• Fragmented Process• Frictional Transaction Costs

Hard Money Lenders

• Small, Obscure Groups• Fragmented Market• Geographic Constraints• Inconsistent Underwriting

Archaic Lending Processes

Traditional Real Estate Lending


Marketplace lending platforms, independent of their lending vertical, are geared towards originating large scales of volume.

In real estate, this could mean originating loans at 90% LTV, taking 2nd lien positions, and/or granting loans to less qualified borrowers.

The Prime Meridian Real Estate Lending Fund remains true to its investment objective and buy-box criteria.

Buy-Box Criteria1:

• 75% Max Loan-to-Value• 75% Max After-Repair-Value• 80% Max Loan-To-Cost• 100% First-Lien notes only• 100% Personal Guarantees• Portfolio Average Loan-to-Value: 65%

Guidelines in place for proper portfolio diversification such as geographic, property type, and individual loan parameters

Real Estate Lending Platforms Prime Meridian Real Estate Lending Fund, LP

1 Subject to Change Without Notice

Defining Objectives (Platform vs. Fund)


Platform: Patch of Land (as of May 2019) $891mm funded across 2,022 Loans, in 44 States Strong underwriting

Platform: Sharestates (as of June 2019) $1.89bn funded across 2,058 Loans, in 30 States Strong underwriting - $0 net losses to date

Platform: Money360 (as of July 2019) $1.25bn funded as 164 loans, in 38 states Strong underwriting - $0 losses to date

Platform: LendingHome (as of March 2019) $3.5bn funded across 15,000 Loans $2.65bn of principal and interest returned to investors Strong underwriting –Total portfolio principal loss is under 0.24%

Platform: Fund That Flip (as of June 2019) $255M funded across 18 states $260K average loan size Strong underwriting – Principal loss of 1.0%

Borrowers: Professionals builders and developers, who operate a professional company Long track records and experience in property rehabs and purchases Local experts in their community and geographic area Use of attorneys, contracts, etc.

Platforms and Select Data


Appendix D: Litigation FinancePrime Meridian Special Opportunities Fund, LP


Prime Meridian’s litigation finance investment objective is to invest in lawsuits that have strong legal merit, plaintiff’s lawyers with a successful track record, and defendant creditworthiness. These three factors help ensure the highest probability of winning the case and the defendant paying the settlement.

Litigation finance is a specialized alternative fixed income asset class Litigation finance is the practice of a third-party unrelated to a lawsuit typically entering into a contractual

agreement with either the plaintiff in the lawsuit or a contractual agreement with the plaintiff’s attorney. A third-party investor’s agreement with a plaintiff provides a non-recourse upfront payment in exchange for a

meaningful return to the investor; an agreement with the plaintiff’s attorney is typically a loan structure The third-party investor’s financial return for an investment in the plaintiff can result in multiple forms including 1)

a flat fee, 2) a percentage of the amount recovered in the lawsuit, 3) a set payment amount that is typically a multiple of the advance

The third-party investor’s financial return for an investment with the plaintiff’s attorney is typically in the form of a loan with high yielding interest terms.

There are typically two main types of lawsuits for potential investment: Tort lawsuits: These lawsuits are mainly lawsuits filed by individuals for personal injury, negligence, and

accidents Commercial lawsuits: These lawsuits are typically filed between two businesses for claimed breach of

contract and intellectual property disputes

Strictly Confidential – Not for Distribution or Duplication. Not an offer to invest. Risk of lose exists.

Special Opportunities Fund - Litigation Finance Overview

31

Appendix D: Life SettlementsPrime Meridian Special Opportunities Fund, LP


Prime Meridian’s life settlements investment objective is to invest in a diverse group of policies that correctly assess the insured’s remaining life expectancy and ensure the policy’s specific provisions dictate accurate payouts to the fund.

Life insurance-based investments are typically structured as either a loan to the policy owner or as an outright purchase of the policy

In both cases, the investor is obligated to pay ongoing policy premiums in return for receiving a return of the death benefit at maturity

The investor will receive some of the death benefits with loans and all of the benefit with an outright purchase

Strictly Confidential – Not for Distribution or Duplication. Not an offer to invest. Risk of lose exists.

Special Opportunities Fund - Life Settlements Overview

33

Whether you’re allocating from the US or Internationally, Prime Meridian Capital Management caters to investors from all ends of the globe via our onshore and offshore fund structures.

Global Access for International Investors

Administrator: Opus Fund Services, Bermuda

Auditor: BDO USA

Fund Custodian: Millennium Trust

Custodial Bank: Wells Fargo, San Francisco, CA

Legal: Harneys, Tortola, BVI

Approved Banks: Credit Suisse, HSBC, Euroclear Bank, Clearstream Banking, Bank Hapoalim, among others.

• Cusip G72426110 ISIN VGG724261109 • Bloomberg: {PRIMERF KY Equity <GO>}

Prime Meridian Income Fund Feeder SP

• Cusip G72426102 ISIN VGG724261026 • Bloomberg: {PRMSBFF KY Equity <GO>}

Prime Meridian Small Business Lending Fund Feeder SP

• Cusip G72426136 ISIN VGG724261364 • Bloomberg: {PRMRREF KY Equity <GO>}

Prime Meridian Real Estate Lending Fund Feeder SP

• Cusip G72426144 ISIN VGG724261448

Prime Meridian Special Opportunities Fund LP

Cusip, ISIN, Bloomberg Data Service Providers

Prime Meridian Marketplace Lending SPC Limited

Prime Meridian Capital Management, LLC


Prime Meridian Capital Management2121 N. California Blvd. STE 830

Walnut Creek, CA 945961 + 415.235.5088

[email protected]

Contact

For more information regarding Prime Meridian Capital Management and to learn more about our suite of diversified income strategies, we encourage you to contact us.
