PROSPER FUNDING LLC $500,000,000 Borrower Payment ...

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PROSPER FUNDING LLC $500,000,000 Borrower Payment Dependent Notes PROSPER MARKETPLACE, INC. PMI Management Rights This is a public offering to lender members of Prosper Funding LLC of up to $500,000,000 in principal amount of Borrower Payment Dependent Notes, or “Notes.” Each Note will come attached with a PMI Management Right issued by Prosper Marketplace, Inc. Prosper Funding LLC will be the sole issuer of the Notes and Prosper Marketplace, Inc. will be the sole issuer of the PMI Management Rights. Each series of Notes will be dependent for payment on payments Prosper Funding LLC receives on a specific borrower loan described in a listing posted on its peer-to-peer online credit platform, which is referred to in this prospectus as the “platform.” All listings on the platform are posted by individual consumer borrower members of Prosper Funding LLC requesting individual consumer loans, which are referred to in this prospectus as “borrower loans.” In addition, each listing will be described in a prospectus supplement. Important terms of the Notes include the following, each of which is described in detail in this prospectus: ·

The Notes are special, limited obligations of Prosper Funding LLC only and are not obligations of its parent company, Prosper Marketplace, Inc. or of the borrowers under the corresponding borrower loans.

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Prosper Funding LLC’s obligation to make payments on a Note will be limited to an amount equal to the Note holder’s pro rata share of amounts Prosper Funding LLC receives with respect to the corresponding borrower loan, net of any servicing fees. Neither Prosper Funding LLC nor Prosper Marketplace, Inc. guarantees payment of the Notes or the corresponding borrower loans.

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The Notes will bear interest from the date of issuance, have a fixed rate, be payable monthly and have an initial maturity of three or five years from issuance. Prosper Funding LLC may add additional Note terms from time to time.

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A Note holder’s recourse will be extremely limited in the event that borrower information is inaccurate for any reason. Important terms of the PMI Management Rights include the following, each of which is described in detail in this prospectus:

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The PMI Management Rights will not be separable from the Notes offered on the platform and will not be assigned a value separate from the Notes.

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The PMI Management Rights are “investment contracts” issued by Prosper Marketplace, Inc. directly to Note holders. The phrase “investment contract” is a concept under federal securities law that refers to an arrangement where investors invest money in a common enterprise with the expectation of profits, primarily from the efforts of others. Here, the “investment contracts” that Prosper Marketplace, Inc. is registering as PMI Management Rights arise from the services that Prosper Marketplace, Inc. has provided and will provide, as described in the Administration Agreement, the Indenture, the Lender Registration Agreement, and in this prospectus, which services include, but are not limited to: · · · · ·

the existence and operation of the platform; verification of borrower information; evaluation and validation of the Prosper Score and Prosper Rating; remitting borrower payments; and collecting on delinquent accounts.

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Investors who purchase PMI Management Rights will have rights under the federal securities laws as a purchaser of a registered security. Investors will have limited contractual rights, collectively through the indenture trustee, to enforce Prosper Marketplace Inc.’s contractual obligations under the Administration Agreement. Such contractual rights exist under state law and will not, in any way, affect the rights of investors under the federal securities laws.

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Prosper Marketplace, Inc.'s obligations to provide services under the Administration Agreement may be terminated by Prosper Marketplace,