In order to receive your tokens, please fill out the form below. We will send your tokens, if eligible, upon approval.
I (“Purchaser”) acknowledge and accept that there are risks associated with purchasing the Tokens, holding the Tokens, and where applicable, using certain Tokens with Kairos products, as more fully disclosed and explained below. BY PURCHASING AND RECEIVING THE TOKENS, I EXPRESSLY ACKNOWLEDGE AND ASSUME THESE RISKS.
Purchasers should note that the Company has little to no performance or operational record with crypto assets, and is in the earliest stages of investigating, planning and developing its Tokens and the Product. Consequently, many details about the Tokens and the Product, the development strategy, and the business model are not known, are uncertain, and are subject to change with or without notice. Many factors could influence the success of the Company and its anticipated crypto asset products and services, some of which are out of the Company’s control, and there is no guarantee that the Company will further explore the development of or will ultimately be successful in developing these Tokens and/or the Product. Further, the Tokens and the related Product would represent a new business venture for the Company’s management team. Management’s past successes do not guarantee future outcomes or the long-term success of the Tokens and the Product. The Kairos Utility Token does not confer ownership or equity rights in the Company, profit or revenue sharing rights in the Company’s operations, or the right to vote on Company or Board governance matters or otherwise how the Company is operated. In addition, there is no guarantee that the Tokens would hold their value or increase in value, and no assurance that any Purchaser would achieve his or her investment objective or avoid substantial losses by investing in the Tokens. Instruments like the Tokens entail a high degree of risk, and Purchasers may lose some or all of their investment. A potential Purchaser should invest in the Tokens only if able to withstand a total loss of the investment. The issuance of any Token particularly for no consideration may be a taxable event. To the extent the value of the Token issued to Purchaser exceeds the consideration paid for same, the difference may constitute gain which will be a taxable event upon issuance.
(1) There are various regulatory risks for the Company associated with its potential Tokens and Product.
Any Token offerings would be offered in reliance upon exemptions from the registration requirements of the Securities Act and its foreign equivalents, if applicable. As a result, there will be substantial restrictions on the transferability of the Tokens, and there may be no public market for the Tokens. The Tokens may not be offered, sold or transferred in the United States absent registration or an applicable exemption from the registration requirements. In particular, it may be that the Tokens may not be transferred within the United States or to a “U.S. person” unless such transfer is made to an “accredited investor” in compliance with applicable securities law, and may only be transferred in a transaction outside the United States to non-U.S. persons, subject to applicable law. Any transfer of a Token made in violation of these restrictions or other foreign equivalents will be void.
In addition, the state of New York requires a license to conduct a virtual currency business. Currently, only New York has this type of requirement, but other states may adopt similar requirements. Purchasers who are residents of a state that requires a license to conduct a virtual currency business would not be allowed to purchase the Tokens. If the Company were deemed to be conducting an unlicensed virtual currency business, it would be subject to significant additional regulation and/or regulatory consequences. This could lead to significant changes with respect to the Product, how the Tokens are structured, how they are purchased and sold, and other issues, and would greatly increase the Company’s costs in creating and facilitating transactions in the Tokens. It could lead to the termination of the Tokens. Further, a regulator could take action against the Company if it views the Tokens as a violation of existing law. Any of these outcomes would negatively affect the value of the Tokens and/or could cause the Company to cease operations.
In addition, the Company believes that it is not a money transmitter (“MT”) or a money services business (“MSB”). If the Company was deemed to be a MT and/or MSB, however, it would be subject to significant additional regulation. This could lead to significant changes with respect to the Product, how the Tokens are structured, how they are purchased and sold, and other issues, and would greatly increase the Company’s costs in creating and facilitating transactions in the Tokens. It could lead to the termination of the Tokens. Further, a regulator could take action against the Company if it views the Tokens and the Product as a violation of existing law. Any of these outcomes would negatively affect the value of the Tokens and/or could cause the Company to cease operations.
(2) The Company’s Tokens may be subject to non-US regulations. The regulatory risks described above take into consideration U.S. law only. It is anticipated that the Tokens would also be sold or resold outside the United States, which could subject the Company or the Tokens to non-U.S. legal requirements, which could be significant. Non-U.S. regulation could lead to the same types of changes and outcomes described above with respect to U.S. regulation, and any of these outcomes would negatively affect the value of the Tokens and/or cause the Company to cease operations.
(3) Changes in international, federal, state, or local laws may impact the value of the Tokens and/or the Company’s ability to develop the Product and its Tokens. Legislative and regulatory changes or actions at the state, federal, or international level may adversely affect the use, transfer, exchange, and value of the Tokens. The regulatory status of the Tokens and similar crypto assets is unclear or unsettled in many jurisdictions. It is difficult to predict how or whether regulatory agencies may apply existing or new regulations with respect to such technology and its applications, including the Tokens and the Product. Further, it is difficult to predict how or whether legislatures or regulatory agencies may implement changes to law and regulation affecting distributed blockchain ledger technology and its applications. Regulatory actions could negatively impact the Tokens and the Product in various ways, including, for example, through a determination that the Tokens are regulated financial instruments required to be registered with the appropriate regulatory agency. Any of these outcomes could prevent the company from fully developing the Tokens and the Product.
(4) Token Purchasers may be vulnerable to social engineering, phishing emails, man-in-the-middle, phone hijacking, ransomware, denial of service, hacking, and other cyber attacks. The nature of crypto assets, such as Ether and the Tokens, may lead to an increased risk of fraud or cyberattack. Hackers or other malicious groups or organizations may attempt to interfere with the purchase of Tokens using virtual currency in a variety of ways, including, but not limited to, malware attacks, denial of service attacks, consensus-based attacks, Sybil attacks, smurfing, spoofing, social engineering, phishing emails, man-in-the-middle, phone hijacking, and ransomware. Recently, other platforms that sponsor and engage in transactions in crypto assets have been the subject of cyberattacks that have resulted in a loss of crypto assets. Among other things, a Purchaser could lose his or her investment in virtual currency due to these types of threats, or the Company could experience a loss of virtual currency in its own wallet, which would undermine core components of the Product and put the Company at financial risk. While the Company would take all steps that are commercially reasonable and customary to prevent or mitigate the impact of cyberattacks, there can be no guarantee that the Company would be successful in preventing all cyberattacks on its systems.
(5) A Company competitor may offer the same or similar service as the Company. It is possible that alternative products could be developed that utilize the same technology and protocol underlying the Product, either directly or indirectly through reverse engineering, and that may offer the same or materially similar features as the Product, which could lead the Company to forego the development of the Tokens and Product, leading to the loss of investments.
(6) The value of Bitcoin, Ether, or other cryptocurrencies may impact the Company’s success. Some of the Company’s investment proceeds may be denominated in Bitcoin, Ether, or other cryptocurrencies and may be converted by the Company into other cryptographic and fiat currencies in its sole discretion. If the value of Bitcoin, Ether, or other cryptocurrencies fluctuates unfavorably during or after the sale period of the Tokens, Company management may not be able to fund development of the Tokens and the Product, and may otherwise be adversely impacted.
(7) There may be a low demand for the Company’s Tokens. It is possible that there would be little to no demand for the Tokens. In such an event, the short-term and long-term viability of the Tokens and the Product would be in doubt, and the Company may terminate the Tokens and cease all operations. Moreover, the crypto asset market is a new and untested market, the characteristics and behavior of which, in the context of domestic and global markets, is not fully understood. There is no guarantee that the Company would be successful at developing the Tokens or the Product. Further, a government could prohibit the commercial or non-commercial use of the cryptographic methods necessary to the release of the Tokens and operation of the Product. Any of these negative outcomes could lead the Company to forgo the Tokens and the Product. As a result, the Company may be unable to deliver Tokens or reimburse investments for Tokens.
(8) The Company may cease operations and go out of business. There is no guarantee that the Company or any of its Affiliates will continue as viable companies. The use and value of the Tokens depend on the Company’s success and support of the Product. If the Company ceases operations and goes out of business, a Purchaser may lose all of the value of his or her investment.
(9) The regulatory regime governing blockchain technologies, cryptocurrencies, crypto assets, token and coin offerings is uncertain, and new regulations or policies may materially adversely affect the utility of the Tokens. Regulation of crypto assets (including the Company’s potential Tokens) and crypto asset offerings, cryptocurrencies, blockchain technologies, and cryptocurrency exchanges is currently undeveloped and likely to rapidly evolve. It varies significantly among international, federal, state and local jurisdictions and is subject to significant uncertainty. Various legislative and executive bodies in the United States and in other countries may in the future adopt laws, regulations, guidance, or other actions which may severely impact the adoption and utility of the Tokens. Failure by the Company or certain users of its Product to comply with any laws, rules and regulations, some of which may not exist yet or are subject to interpretation and may be subject to change, could result in a variety of adverse consequences, including civil penalties and fines. As blockchain networks and blockchain assets have grown in popularity and in market size, federal and state agencies have begun to take interest in, and in some cases, regulate, their use and operation. In the case of virtual currencies, state regulators like the New York Department of Financial Services have created new regulatory frameworks. Others, as in Texas, have published guidance on how their existing regulatory regimes apply to virtual currencies. Some states, like New Hampshire, North Carolina, and Washington, have amended their state's statutes to include virtual currencies in existing licensing regimes.Treatment of virtual currencies continues to evolve under federal law as well. The Department of the Treasury, the Securities Exchange Commission, and the Commodity Futures Trading Commission, for example,have published guidance on the treatment of virtual currencies. The IRS released guidance treating virtual currency as property that is not currency for US federal income tax purposes, although there is no indication yet whether other courts or federal or state regulators will follow this classification. Both federal and state agencies have instituted enforcement actions against those violating their interpretation of existing laws.
(10) The further development and acceptance of blockchain networks, which are part of a new and rapidly changing industry, are subject to a variety of factors that are difficult to evaluate. The growth of the blockchain industry in general, as well as cryptocurrencies and digital securities, is subject to a high degree of uncertainty. The factors affecting the further development of the cryptocurrency and digital security industry, as well as blockchain networks, include, without limitation:
The slowing or stopping of the development, general acceptance and adoption and usage of blockchain networks and blockchain assets may adversely affect our operations and deter or delay the acceptance of the Tokens.
(11) Some market participants may oppose the development of blockchain-based systems and crypto assets such as the Tokens. Many participants in the system currently used in the private equity markets may oppose the development of alternative systems. The market participants who may oppose such a system may include market participants with significantly greater resources, including financial resources and political influence. The Company’s ability to operate could be adversely affected by any actions of any such market participants that result in additional regulatory requirements or other activities that make it more difficult for it to operate, which could have a material adverse effect on its business or the Tokens.
(12) The prices of blockchain assets are extremely volatile, and fluctuations in the price of digital assets could materially and adversely affect the Company’s business, and the Tokens may also be subject to significant price volatility. The prices of blockchain assets such as BTC have historically been subject to dramatic fluctuations and are highly volatile, and the market price of the Tokens may also be highly volatile. Several factors may influence the market price of the Tokens, including, but not limited to:
A decrease in the price of a single blockchain asset may cause volatility in the entire blockchain asset industry and may affect other blockchain assets including the Tokens. For example, a security breach that affects investor or user confidence in BTC and ETH may affect the industry as a whole and may also cause the price of the Tokens and other blockchain assets to fluctuate.
(13) The Company’s decision to accept and hold cryptocurrency, such as BTC and ETH, may subject it to exchange risk and additional tax and regulatory requirements. The Company May accept payment for the Tokens in the form of BTC and ETH. Cryptocurrencies are not considered legal tender or backed by any government, and have experienced price volatility, technological glitches andvarious law enforcement and regulatory interventions. The Company has exchange rate risk as regulatory or other developments may adversely affect the value of the cryptocurrencies it may hold. The Uncertainties regarding legal and regulatory requirements relating to cryptocurrencies or transactions utilizing cryptocurrencies, as well as potential accounting and tax issues or other requirements relating to cryptocurrencies, could have a material adverse effect on the Company’s business.
(14) The Tokens and Product may have software weaknesses. The Tokens, the Product, and the related software, technology, technical concepts and theories are still in an early development stage and are unproven, and there is no guarantee that the process for receipt, use and ownership of the Tokens will be uninterrupted or error-free, and there is an inherent risk that the software, the Tokens and related technologies and theories could contain weaknesses, vulnerabilities or bugs causing the partial or complete loss of the Tokens.
(15) Cryptocurrency exchanges and other trading venues are relatively new and, in most cases, largely unregulated and may therefore may be subject to fraud and failures. When cryptocurrency exchanges or other trading venues are involved in fraud or experience security failures or other operational issues, such events could result in a reduction in cryptocurrency prices or confidence. Cryptocurrency Market prices depend, directly or indirectly, on the prices set on exchanges and other trading venues, which are new and, in most cases, largely unregulated as compared to established, regulated exchanges for securities, commodities or currencies. For example, in recent years, some bitcoin exchanges have closed due to fraud, business failure or security breaches. In many of these instances, the customers of the closed exchanges were not compensated or made whole for partial or complete losses of their account balances. While smaller exchanges are less likely to have the infrastructure and capitalization that may provide larger exchanges with some stability, larger exchanges may be more appealing targets for hackers and “malware” (i.e., software used or programmed by attackers to disrupt computer operation, gather sensitive information or gain access to private computer systems) and may be more likely to be targets of regulatory enforcement actions. The Company does not maintain any insurance to protect from such risks, and does not expect any insurance for customer accounts to be available (such as federal deposit insurance) at any time in the future, putting customer accounts at risk from such events.
(16) It may be illegal now or in the future to acquire, own, hold, sell or use BTC, ETH, or other cryptocurrencies, or to participate in the blockchain or to utilize similar digital assets in one or more countries. Although currently BTC, ETH, and other cryptocurrencies, the blockchain, and digital assets generally are not regulated or are lightly regulated in most countries, including the United States, one or more countries may take regulatory actions in the future that could severely restrict the right to acquire, own, hold, sell or use these digital assets. Such restrictions may adversely affect the holders of the Tokens.
(17) This Token Offering is risky. This Token Offering is extremely risky and is not an appropriate investment for every Purchaser eligible to participate. The Company does not warrant the Token Offering’s suitability for any Purchaser.
(18) The Tokens may not be freely tradeable. The Tokens are being offered in reliance upon exemptions from the registration requirements of the Securities Act. As a result, the Tokens may not be transferred in the United States or to U.S. persons absent registration or an applicable exemption from registration requirements. Any transfer made in violation of these restrictions or other foreign equivalents will be void. Even if the Tokens become freely tradeable, there is no guarantee that holders will be able to sell or exchange their Tokens. In the event that secondary trading of the Tokens is facilitated by third party exchanges, such exchanges may be relatively new and subject to little or no regulatory oversight, making them more susceptible to fraud or manipulation. Third party exchanges may also lack substantial liquidity, limiting the feasibility of selling or exchanging the Tokens. If third party exchanges and secondary trading become subject to regulation, this development could negatively affect liquidity and pricing in the market. Holders of the Tokens should be prepared to hold onto their Tokens if necessary for an indefinite period.
(19) The tax consequences of owning the Tokens is uncertain. The tax characterization of the Tokens is uncertain, and each Purchaser must seek his or her own tax advice in connection with an investment in the Tokens. An investment pursuant to the Purchase Agreement and the purchase of Tokens pursuant thereto may result in adverse tax consequences to Purchasers, including withholding taxes, income taxes and tax reporting requirements. Each Purchaser should consult with and must rely upon the advice of his or her own professional tax advisors with respect to the United States. In addition, the Company encourages Purchasers to review IRS Notice 2014-21 which sets forth published guidance for the U.S. Internal Revenue Service concerning the consequences of transacting in cryptocurrency, such as the Tokens.
I acknowledge and am aware that any transfer made in violation of the transfer provisions of the investment agreements I signed with Kairos or the applicable securities laws in the jurisdiction where I reside will be void. I also understand that the Tokens will not be registered under the Securities Act, and may not be offered or sold in the United States or to U.S. persons absent registration or an applicable exemption from the registration requirements.