E-2 Visa Investors | Behar Law Group

E-2 Treaty Investor - Nonimmigrant Visas

Legal Requirements

The investor, either a real or corporate person, must be a national of a treaty country.
The investment must be substantial. It must be sufficient to ensure the successful operation of the enterprise. It cannot be marginal.
The investment must be proportional to the nature of the business.
The investment must be a real operating enterprise with verifiable

and legitimate business activities.
No job creation requirement.
Franchise acquisition acceptable.
Conditional agreement structured prior to final interview.
The investment must generate more income than just to provide a living to the investor and family, or it must have a significant economic impact in the U.S.;
The investor must have control of the funds, and the investment must be at risk in the commercial sense;
Investor must be able to demonstrate lawful origin, source and path of investment funds;
The investor must be coming to the U.S. to develop and direct the enterprise. If the applicant is not the principal investor, he or she must be employed in a supervisory, executive, or highly specialized skill capacity. Ordinary skilled and unskilled workers do not qualify;

E-2 Investors Useful Information

E-2 developer due diligence checklist

Investor chart E-2 complete structure

Investor communications

Investor considerations

Investor organizational summary

E-2 project summary checklist

Investor organizational summary

Investor sources of funds and filters

U.S. Tax Residency

E-2 Investor Chart Structure

Prospective E-2 Investor (Selected Countries)

Owns Any New or Existing U.S. Entity, Minimum $150,000 capitalization (LLC, Inc., Solo,)

X % ( e.g. 5% to 100%) Investor’s Entity Acquires Percentage in New or Existing Operating Commercial Enterprise + Advisory/Board Position

Master Entity Owns 100% of U.S. Operations

E-2 Investor Documents

S. & Foreign Bank statements of deposits
Evidence of money transferred or path of funds
Loan or Mortgage Agreement, Promissory Note, Security Agreement, Borrowing
Foreign Business registration records
Tax Returns (5 years)
Monetary judgments (15 years)
Personal Documents
Passport (must be valid)
Criminal Records
Foreign Banking Source
Bank Wire Instructions
Financial Commitment and Signature
Legal Fees
Government Filing Fees
Source of Funds
Photographs (8)
Financial Statement (personal)
Birth Certificates
Death Certificates (if applicable)
Divorce Decrees
Net Worth Statement
G-28 Notice of Appearance of Attorney
Translations of all foreign language documents

E-2 Due Diligence Checklist Project Development

I. General Property Information
a. Aerial Maps
b. Property Photographs
c. Title report
d. Appraisal
e. Demographics
f. Discussion of competing properties
g. Purchase Agreement or Option Agreement
h. Phase One Environmental Report
i. Risk Assessment
j. Zoning Information

II. Financing Information
a. Lender Information
b. Dollar amount of loan
c. Term of Loan
d. Interest Rate
i. Fixed
ii. Variable and what index and margin
e. Required signers
f. Recourse requirements
g. Loan Commitment
h. Supporting Documents for financing commitments

III. Investment Objectives
a. Purpose of Investment
i. Cash flow from operations
ii. Value added
iii. Capital appreciation
iv. Tax benefits
v. Equity build up thru loan payoff
vi. Job creation
b. Sources and Uses of Funds Statement
c. Proposed duration of investment
d. Projections as to the first year of operations
e. Projections of subsequent years of operations
f. Assumptions used in making financial projections

IV. Ownership Entity
a. LLC or LP
b. Owner ship Entity (prospective structure)
i. Who is the Managing Member or Sponsor?
ii. Who will the Members be?
iii. Compensation paid to : GP / Managing Member/ RC or Sponsor during each phase
1. Acquisition
2. Operations
3. Disposition
c. Will this investment be eligible for EB-5
i. Direct
ii. Regional Center
d. Banking arrangements
e. CPA
f. Organization documents and filings

V. Risk Factors Specific to:
a. Proposed property
b. The current market
c. The investment type

VI. Sponsor Track Record
a. Education
b. Work experience
c. Track record on other projects of similar type or other

VII. Specific Information re: Land Project
a. Entitlements
i. Do any exist currently
ii. Does the project require entitlements
iii. If you do require entitlements what agencies are involved?
iv. if entitlements have been applied for previously what is the status
b. Budget re: Entitlements
c. Cost estimates:
i. Design professionals
ii. Consultants (all required)
iii. Time (estimated)

d. Projected sales and absorption figures
e. Proposed budget for construction

VIII. Information for Purchase of Existing property
a. Current or Proposed use of building
b. Property condition report
c. Statements (3 years Profit & Loss)
d. Balance sheets (3 years)
e. Proposed job creation with supporting documents
f. Proposed value after improvements are completed with supporting documents
g. Information on existing or proposed tenants
i. Financial reports
ii. Bios of personnel
iii. Business plans
iv. Track records
h. Formation documents
i. Copy of proposed lease or leases
j. Corporate or personal guarantees
k. Business plan of Sponsor
i. Decrease vacancy
ii. Increase rents
iii. Decrease expenses
iv. Job creation

IX. Investment
a. State department form
b. Job creation analysis & descriptions
c. Economic Impact Analysis on project (Geographic & Demographic)
d. Business Plan
e. Feasibility StudiesAn accordion content area

E-2 Investor - Communications

E-2 Investor Project Considerations

Investor project selection: independent decision
Investor and agent project selection
Access and opportunities to visit on-site
Advisory professionals
Contract; contract disclaimer
Subscription Agreement signature
Past performance
Due diligence period
Due diligence documentation
Banking funds flow
Staff onsite oversight
Visa office
Insurance verification
General insurance
International accounting and audit
State tax collector
State banking regulation
Due diligence and case standard
Media; local press
Police forensics; state/local
Fee agreement (English & native language)
On site visits
Time lapse / Cancel
No personal or contractual relationship
Accreditation/ knowledge of Investor
SOF Analysis

E-2 Investor Family Relocation Considerations

Map
Year-round weather
Crime statistics
Air access
Places to go
Things to do
Real Estate style and prices
Schools
Neighborhood
Commute distance
Traffic
Education
Job options
Job options for spouse and children
Familiarization trip
Health care facilities
Local amenities
Family partnerships / for assimilation
Transportation
Headquarter presence / office
Restaurants
Shopping
Security
Existing family members
Air, Light, Water Security, Traffic

Investor Organizational Summary

Limited Liability Company (LLC ) – State Charter (As at April 17, 2020)

To receive Membership Interest in LLC
Direct or Indirect/Induced Job creation preferred
Operating Agreement
Contract with Management Company (as needed)
Possible Investor Lender Group (less than 49%)

E-2 New Investors Considerations

Safety of investment
Return of principal in the business plan (5 years)
Fair rate of return during process
Personal investment by the applicant
International Travel Ease
S. Travel Ease; duration of stay in 2 year segments
Synchronized processing to ensure timely delivery of visa
Personal and Family Security
Job creation model
Business & economic plans
Exit strategy
Minor children to receive U.S. Education (Under 21 years old)

E-2 Project Summary Checklist

Name: ……….
Type: ……….
Location: ……….
Investors: ……….
Capital Stack (projected): ……….
Job Creation: ……….
Documents Status/Availability: ……….
Experience: ……….
Special Comment: ……….
Local Support: ……….
Timeline: ……….
Equity: ……….
Phases: ……….
Risks: ……….
Equity/Loan: ……….
Summary/Recommendation: ……….
Date of Report/Time: ……….

Investor Cost & Benefit Analysis

Cost:

$100,000 investment; (+/-) Administrative and Immigration Processing

Benefit:

Participation in E-2 Program Platform;
Management company services allowed
Immediate projected cash flow from qualified businesses
Includes spouse and all minor children under age 21 at time of filing
Immigration Legal Services and Consular Filing
Government Filing Fees & Coordination
Spouse Work Authorization
Qualifying Countries: (Charts)

Investor Eligibility Issues

Age out issues: “Child” must be under 21 years old.
Admissibility issues based on technology, security, U.S. national interest: Extended reviewed
Criminal record: Will be reviewed or waiver required
Out of status or visa violations: Consular rejection risk
Military history: Genocide, enemies of the state
Political history: Communism
No waiver of eligibility options
Tax considerations + Violations

Investor Qualifications & Considerations

Review of Business Plan or Summaries
Valid Passport
Numerous nationalities may qualify (see list)
No Criminal Record (under U.S. law)
Availability of Funds in 60 Days
List of immediate family members and children under 21 years of age
Identifiable and Legal Source of Funds
Independent Legal, Advisory Counsel and accounting counsel.
Past Five years tax returns (verifiable)
Financial + Banking advisory

Source of Funds - Investor

Wire Transfers
Loans
Bank Statements
Cash
Financial Support
Money Manager/Reports
Tax Returns: 5 years
Gifts
Deposit Slips
Inheritance
Stock or asset sale
Savings
Business Value
Donor source (for child)
Retained earnings
Historical narrative needed

Source of Funds - Filters & Verifications

Foreign Source Bank
Currency Exchanger
U.S. Receiving Bank
U.S. Reviewing CPA’s
U.S Reviewing Attorneys
Client written Declaration
State Department Review
U.S. Government – OFAC
U.S. Embassy, Consulate or USCIS
Escrow Agent (as needed)

U.S. Tax Residency Calculation

Yr 1	Yr 2	Yr 3
1/6 x	1/3 x	x days
x days	x days

= 183 or > 183 (122)

This chart is used to approximate U.S. Tax residency imposition or qualification. Consult a qualified U.S Tax accountant or attorney.