Disclosures/Disclaimers

COMMUNICATION DISCLAIMER 

This disclaimer is deemed to be incorporated by reference in its entirety into any social media communication, advertisement, email or other communication or disclosure which contains reference to this disclaimer (each, a “Communication”).

Kagin’s Digital LLC (the “Issuer”), Kagin’s Rare Coin Enterprises I, LLC, Kagin’s Inc., and each of their affiliates, directors, managers, officers, investors, partners, employees, and contractors, may be referred to individually as a “Company” or together as the “Companies”.

Neither Kagin Entities nor any third-party broker-dealer provides any investment advice or make any investment recommendations to any persons, ever, and no communication through the https://kagins.digital/ website or in any other medium should be construed as such. The Communication and the subject matter contained within it, does not constitute a solicitation to purchase or an offer to sell any securities.

TERMS OF USE

These Terms of Use shall apply to the Units, as defined the Offering Circular related to The 1934 $100,000 US Gold Certificate Specimen NFT Offering, which is incorporated by reference herein. Capitalized terms herein shall have the meaning given in the Offering Circular.

Rights and Obligations

  • Each NFT represents a 1/500 ownership share of the Asset.  
  • The NFTs shall not have any equity ownership interest in the Company. The NFT owners shall not have any protection of the rights of equity investors under applicable Delaware law.
  • NFT owners shall not be entitled to dividends, profits and losses, or other Company revenue other than revenue attributable directly to the Asset as specifically set forth in the Offering Circular.
  • Meetings.  NFT owners shall not have the right to attend and participate in shareholder meetings.
  • Board. NFT owners shall have no voting rights to set the composition of the Board of Directors.

Offering in Kagin’s Entities

  • The Issuer is structured as a Delaware series limited liability company that issues fractional ownership (the “Units”) of a NFT, non-fungible token, (the “Offering”) specific to a $100,000, Gold Certificate, 1934 United States bank note (the “Underlying Asset”). The Offering entitles a person to acquire a fractional ownership interest in the Underlying Asset and not, for the avoidance of doubt, in the Companies. The Offering is subject to the Offering Circular. This important document is available via the https://kagins.digital/ website, or by requesting a copy by e-mail, or publicly via the U.S. Securities & Exchange Commission EDGAR service, and should be read by all investors prior to acquiring any Units.
  • The Offering is being conducted (i) under Rule 506(c) of the Securities Act of 1933, as amended (the “Securities Act”), (ii) only through an Offering Circular and (iii) exclusively through the Issuer. Units offered under Rule 506(c) are being offered and sold only to “accredited investors” within the meaning of Rule 501 of Regulation D under the Securities Act, pursuant to the Offering Circular and related documents. Individuals are accredited investors only if they meet certain minimum net worth or sustained annual income thresholds. Entities are accredited investors only if they hold assets of at least $5 million or are completely owned by accredited investors. Even so, each investor must rely on its own examination of the Companies, the Units, the Underlying Asset, and the terms of the Offering, including the risks and merits involved, before making any investment.
  • No Offering is being made in any jurisdiction where such an offer or solicitation is not lawful or is prohibited or where the broker-dealer, through whom each Offering is being conducted, is not registered. Each Offering is made pursuant to an exemption from the registration requirements of the Securities Act and certain state securities laws. The Companies are not registered as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”) and the membership Interests do not have the benefit of the protections of the Investment Company Act. Furthermore, the Manager is not registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Investment Advisers Act”), and the members of the Company will not have the benefit of the protections of the Investment Advisers Act.
  • Neither the SEC nor any state securities commission has approved or disapproved the Offerings nor have any of the foregoing passed upon or endorsed the merits of an Offering or the accuracy or adequacy of the Offering Circular, or any Communication. Any representation to the contrary is a criminal offense.
  • There is no trading market for the Units at this time and there can be no assurance that such a market will develop in the foreseeable future. The Units may not be resold or otherwise disposed of by an investor unless there are available exemptions from registration under federal and applicable state securities laws (and other requirements are met, which may include an opinion of counsel), or such transfer is made in compliance with the registration requirements of such laws. Accordingly, investors must bear the risk of loss for an indefinite period of time.
  • An investment in Units may involve significant risks. Only investors who can bear the economic risk of the investment for an indefinite period of time and the loss of their entire investment should invest in the Units. See “Risk Factors” herein and in the Offering Circular.
  • No offeree will be accepted as a Unit holder who does not make the representations set forth in the subscription agreement accompanying Offering Circular, including, when applicable, the representation that such offeree is an accredited investor and is acquiring the Units for investment and not with a view to resale or distribution thereof in violation of applicable securities laws, and, when applicable, that the investment amount does not exceed 10% of the offeree’s net worth or annual income. Investors also will be required to represent that they are familiar with and understand the terms of the Offering, among other things. Investors may also be required to provide additional information to verify their identity or investor status.
  • The Offering is limited to U.S. investors.

Risk Factors

  • The Offering of Units is highly speculative in nature, involves a high degree of risk and should be purchased only by persons who can afford to lose their entire investment. The investments in any Offering are not bank deposits (and thus not insured by the FDIC or by any other federal governmental agency), are not guaranteed by the Companies or any third-party broker-dealer and may lose value. The risks described below should not be considered as an exhaustive list of the risks that prospective investors should consider before investing in the Units. All prospective investors should consult the Offering Circular before purchasing Units, which Offering Circular may describe the following risks in more detail and additional risks pertinent to the Offering.

Risks relating to the structure, operation and performance of the Company:

  • There may be state law restrictions on an investor’s ability to sell their Units.
  • The Company does not have a significant operating history and, as a result, there is a limited amount of information about us on which to base an investment decision.
  • There is substantial doubt about our ability to continue as a going concern.
  • There are few businesses that have pursued a strategy or investment objective similar to the Company’s.
  • The amount raised at the Offering may exceed the value of the Underlying Asset.
  • The operating expenses of the company may exceed the revenues generated by such Offering and excess operating expenses could then materially and adversely affect the value of Units.
  • The success of the Companies is dependent on the manager and its team source, acquire and manage the Underlying Asset.
  • The Companies are reliant on managers and their respective personnel. Our business and operations could be adversely affected if the Manager loses key personnel.
  • The Company is currently improving our information technology systems and use security measures designed to protect our systems against breaches and cyber-attacks. If these efforts are not successful, our business and operations could be disrupted, our operating results and reputation could be harmed, and the value of the Units could be materially and adversely affected.
  • Abuse of our advertising or social platforms may harm our reputation or user engagement.
  • If the Companies are unable to protect our intellectual property rights, our competitive position could be harmed, or we could be required to incur significant expenses to enforce our rights.
  • The Companies operations and businesses may be negatively impacted by epidemics, pandemics, outbreaks, or other public health crises.

Risks related to the Offering:

  • If a regulator determines that the Offering requires a broker-dealer registration, the Companies may be required to cease operations and any Units offered and sold without such proper registration may be subject to a right of rescission.
  • If at any time regulators deem that the Units must be traded on a securities exchange or alternative trading system, this may require us to cease operation and will materially and adversely affect the Units.
  • If we are required to register under the Exchange Act, it would result in significant expense and reporting requirements that would place a burden on the Companies and may divert attention from management of the Underlying Assets or could cause the Companies to no longer be able to afford to operate.
  • Changes in federal tax laws may adversely affect securities issued by the Company.

Risks Specific to the Industry and the Underlying Asset:

  • There could be a general downturn in the industry which would likely impact the value of the Underlying Assets given the concentrated nature of the industry.
  • There may be a volatile demand for the Underlying Asset.
  • There may be Federal and State specific regulations related to the Underlying Assets.
  • The company will rely on data from past auction sales, market data, industry perceptions, third-party appraisals, and insurance data, among other sources, in determining the value of the Underlying Asset, and have not independently verified the accuracy or completeness of this information. As such, valuations of the Underlying Assets may be subject to a high degree of uncertainty and risk.

Risks relating to the Underlying Assets:

  • The value of the Underlying Assets and, consequently, the value of Units can rise and fall.
  • The Companies may have to compete with other business models within the asset class.
  • There may be title, authenticity or infringement claims on an Underlying Asset.
  • There are risks associated with reliance on third party authenticators.
  • An Underlying Asset may be lost or damaged by causes beyond the Company’s control while being transported or when in storage or on display. There can be no guarantee that insurance proceeds will be sufficient to pay the full market value of an Underlying Asset which has been damaged or lost which will result in a material and adverse effect in the value of the related Interests.
  • Insurance of Underlying Assets may not cover all losses which will result in a material and adverse effect in the valuation of the Series related to such damaged Underlying Assets.
  • The Company may be forced to sell the Underlying Assets at an inopportune time.
  • There can be no guarantee of distributions or return of capital being made to its Unit investors.
  • Market manipulation or overproduction may be a risk with the Unit.
  • There are instances of forgeries and fraudulent assets.
  • Environmental damage could impact the value of an Underlying Asset which will result in a material and adverse effect in the value of the Units.
  • There may be potentially high storage, maintenance and insurance costs for the Underlying Assets.
  • Refurbishment of Underlying Assets is dependent on third parties and ability to source original parts.
  • Underlying Assets are not guaranteed to be held long term.
  • General sentiment of underlying fan base may be a risk with the asset class as Underlying Assets go in and out of favor with collectors.

Risks Related to Ownership of Units:

  • Unit holders have no rights to the Underlying Asset, except as discussed in the Offering Circular.
  • The offering price for the Units determined by the Companies may not bear any relationship to established valuation criteria such as earnings, book value or assets that may be agreed to between purchasers and sellers in private transactions or that may prevail in the market if and when the Underlying Asset can be sold publicly.
  • Funds from purchasers accompanying subscriptions for the Units will not accrue interest while in escrow.
  • Any dispute in relation to the Offering, Units, and Underlying Asset is subject to the exclusive jurisdiction of the Court of Chancery of the State of Delaware, except where Federal law requires that certain claims be brought in Federal courts. 

Conflicts of Interest:

  • Since the Companies may participate in these distributions, that may impact the timing of distributions made to investors from proceeds generated from a sale of the Underlying Asset.
  • The Companies will determine whether or not the Underlying Asset should be liquidated, should an offer for such Underlying Asset be received. The price achieved in such liquidation may not be in the best interest for all investors in the asset.

Limitation of Liability

Limitation of liability.  To the fullest extent permitted under the law, the Company’s liability in connection with the NFTs shall be limited to that of an issuer of corporate securities. The Company shall have no liability to an NFT owner for any claim (whether arising from the NFT owner or a third party) arising out of the digital nature of the NFTs, the technology on which they rely, or the availability or unavailability of necessary digital support systems for the NFTs.  

Third Party Information and Past Performance:

  • Certain information, including statistical data, third-party quotes and other factual statements, contained in the Communication has been obtained from published sources prepared by other parties considered to be generally reliable. However, none of the Companies, their affiliates or any of their respective directors, shareholders, members, officers, employees or agents assumes any responsibility for the accuracy of such information. There is no representation or warranty, express or implied, as to the accuracy, adequateness or completeness of any such information used in the Communication.
  • Past performance is not necessarily indicative of future results of the Units or the Underlying Asset. Furthermore, to the extent the Communication relates to prior performance of assets similar to the Underlying Asset acquired or to be acquired by the Company, those similar assets may be materially different from, or may not be of the same quality as, the Underlying Asset. Values of comparable assets may vary depending on a number of factors, including market conditions, location of sale, associated taxes, originality of parts, condition of the asset, operating quality, historical significance, ownership history, level of wear and other factors. Values of comparable assets are not adjusted for inflation.
  • Furthermore, the value of Units may materially differ from the value of the Underlying Asset for many reasons, including market factors, applicable fees, and restrictions on liquidity.

Forward-looking Statements:

  • The information contained in the Communication including the Offering may include some statements that are not historical and that are considered “forward-looking statements” within the meaning of Section 27A of the Securities Act. Such forward-looking statements may include but are not limited to: statements regarding the development plans for the Companies’ businesses; their strategies and business outlook; their market sectors; anticipated development of the Companies; and various other matters (including contingent liabilities and obligations and changes in accounting policies, standards and interpretations). These forward-looking statements typically express the Companies’ expectations, hopes, beliefs, and intentions regarding the future. In addition, without limiting the foregoing, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipates”, “believes”, “continue”, “could”, “estimates”, “expects”, “intends”, “may”, “might”, “plans”, “possible”, “potential”, “predicts”, “projects”, “seeks”, “should”, “will”, “would” and similar expressions and variations, or comparable terminology, or the negatives of any of the foregoing, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.
  • Any forward-looking statements contained in the Communication will be based on current expectations and beliefs concerning future developments that are difficult to predict. Neither the Companies nor their manager, officers, employees, service providers, and affiliates can guarantee any future performance, or that future developments affecting the Companies, Units, and Underlying Asset. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the Companies’ control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, including those risks set forth in “Risk Factors” above.
  • All forward-looking statements attributable to the Companies are expressly qualified in their entirety by these risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should any of the parties’ assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. The recipient of the Communication should not place undue reliance on any forward-looking statements and should not make an investment decision based solely on forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Obtain Your Own Advice:

  • Prospective investors are not to construe the contents of the Communication as legal, business or tax advice. Each prospective investor should consult its own advisors as to legal, business, tax and related matters concerning the subject matter of the Communication and the Offering.