EB5 Investors Magazine "Top 25 Awards Edition" Volume 8 Issue 1 - Page 47

TOP CORPORATE AT TORNEYS MICHAEL HOMEIER CORPORATE ATTORNEYS EB5 INVESTORS MAGAZINE I n solo practice, Michael G. Homeier continues practicing securities, corporate, and business transactional law in Los Angeles as he did with Homeier Law PC, now emphasizing more individualized expert service for select clients. In his 13 years of EB-5 practice, Homeier has represented clients on literally hundreds of different projects large and small, primarily regional center and also direct, helping them successfully raise billions of dollars (creating thousands of jobs), while simultaneously working to influence positive policy changes and common-sense integrity reforms. He earned his J.D. from the University of Southern California and his B.A. from UCLA. WHAT TRENDS ARE YOU SEEING IN THE EB-5 INDUSTRY? As the Nov. 21,2019 regulations sink in (higher investment minimums and narrower TEAs), project size seems to be stabilizing in the mid-size range while the EB-5 industry continues to develop investor marketplaces in other countries, including India, Brazil, and South Africa. Projects continue to switch from large, expensive firms to more mid-priced boutique and small law firms with deep experience drafting top-quality securities documents. Projects downstream from their securities offerings continue returning to corporate securities lawyers for workouts and restructurings to lawfully adapt as circumstances arise and to continue satisfying changing EB-5 requirements, including redeployment and investor redemption. How are you handling the issue of redeployment? HOW ARE YOU HANDLING THE ISSUE OF REDEPLOYMENT? I continue to advise clients to address redeployment up-front, both in the offering documents as well as definitive agreements, including the several options available for clients to choose from (predetermined roll-over, new at-risk investment determined upon initial payback, range of reinvestment options, mutual funds). My firm’s tiered approach toward redeployment gives maximum flexibility with the lowest perceived risk of liability, seeking to protect immigrant investors’ investments and accomplish their immigration goals while simultaneously fulfilling the project principals’ disclosure obligations coupled with a reasonable degree of flexibility to address inevitably changed circumstances over time. ANDREW KINGSTON A ndrew Kingston is a principal with Kingston Petersen, PLLC. Kingston has acted as EB-5 securities and corporate counsel since 2009. He served as general counsel to private and publicly- traded companies, and was a founding partner of NNDKP, one of the largest law firms in southeastern Europe. He taught corporate finance in emerging markets at Cornell Law School and was law clerk to Harold M. Fong, Jr., Chief Judge of the U.S. District Court in Hawaii. He received his B.A. from University of Virginia and his J.D. from Harvard Law School. He is a member of the Washington State Bar. WHAT TRENDS ARE YOU SEEING IN THE EB-5 INDUSTRY? The COVID-19 pandemic has taken an enormous toll on the types of projects financed with EB-5 capital, including hotels, shopping centers and luxury condominiums. Even well- managed projects are struggling, and many marginal projects are heading for restructuring or worse. NCE managers have a duty to keep investors informed, which has often meant CORPORATE ATTORNEYS EB5 INVESTORS MAGAZINE delivering bad news. Worried investors are becoming more active within their NCEs, where the loudest and angriest voices receive the most attention. Some have even tried to take their NCE managers to court, which generates additional costs and further reduces the chances of repayment. HOW ARE YOU HANDLING THE ISSUE OF REDEPLOYMENT? To paraphrase Tolstoy, each redeployment is unhappy in its own way. Older PPMs seldom discussed redeployment, setting up potential conflict with sponsors. Many operating agreements prohibit redeployment without investor consent, setting up potential conflict between investors who have completed their two-year sustainment periods and those who have not. NCE managers are arguably unhappiest of all. After they have identified a viable redeployment option, fiduciary duties require managers to provide investors with information to make an informed consent decision. The resulting disclosure document, complete with risk factors and other scary details, can turn investors against both the redeployment option and the managers. EB5INVESTORS.COM 47