William R. Rauth III - 01 Dec 2021 Form 4 Insider Report for APPFOLIO INC (APPF)

Footnote F1

On December 1, 2021, three investment funds of IGSB IVP III, LLC ("IVP III") were dissolved, resulting in the termination of each of those investment funds and the distribution of an aggregate of 3,554,584 shares of AppFolio Class B Common Stock ("Class B Shares") held by those investment funds, pro-rata to the investors in those investment funds. No consideration was paid by any of those investors for the Class B Shares distributed to them. The Reporting Person was not an investor in any of these investment funds and he did not receive any of these Class B Shares in the distribution.

Footnote F2

Each Class B Share is convertible, at any time at the option of the holder, into one share of Appfolio Class A Common Stock ("Class A Shares"). In addition, Class B Shares that are sold or otherwise transferred will convert automatically, on a one share-for-one share basis, into Class A Shares, except for (i) any transfer by a partnership or limited liability company that was a registered holder of Class B Shares prior to June 30, 2015 that is made to anyone who was a partner or member of any such partnership or limited liability company prior to June 30, 2015, and (ii) any transfer to a "qualified recipient" (as defined in AppFolio's Amended and Restated Certificate of Incorporation).

Footnote F3

(Continued from Footnote 2) AppFolio's Class B Shares do not have an expiration date. However, all of the outstanding Class B Shares will convert automatically into Class A Shares, on a one share-for-one share basis, on the date when the number of the Company's outstanding Class B Shares represents less than 10% of the sum of AppFolio's outstanding Class A and Class B Shares.

Footnote F4

On December 1, 2021, four investment funds of IGSB Internal Venture Fund III, LLC ("IVF III") were dissolved, resulting in the termination of each of those investment funds and the distribution of an aggregate of 993,627 Class B Shares pro-rata to the investors in those investment funds. No consideration was paid by any of those investors for the Class B Shares distributed to them. The Reporting Person was not an investor in any of these investment funds and he did not receive any of these Class B Shares in the distribution.

Footnote F5

These Class B Shares are owned by an irrevocable trust established for one of the Reporting Person's grandchildren. The Reporting Person and/or his spouse is the trustee of the trust and, therefore, may be deemed to possess sole voting and dispositive power over the Class B Shares owned by the trust. However, neither the Reporting Person nor his spouse is a beneficiary of the trust and neither of them has, and they disclaim, any pecuniary interest in these Class B Shares.

Footnote F6

These Class B Shares are owned by an irrevocable trust established for another of the Reporting Person's grandchildren. The Reporting Person and/or his spouse is the trustee of the trust and, therefore, may be deemed to possess sole voting and dispositive power over the Class B Shares owned by the trust. However, neither the Reporting Person nor his spouse is a beneficiary of the trust and neither of them has, and they disclaim, any pecuniary interest in these Class B Shares.