IND Token Sale Terms and Conditions Last Updated – 25 July 2017
These Token Sale Terms (these “Terms”) state the terms and conditions under which Indorse Pte. Ltd., a Singapore company with Unique Entity Number 201714808R (“Indorse”) will sell cryptographic tokens (the “IND Tokens”) which represent the right to obtain certain commercial services in an online service to be developed and operated by Indorse, to eligible purchasers during the Pre-Sale Period and Sale Period (each as defined in Schedule 1 (Details of Token Sale). The IND Tokens do not constitute, and are not intended to be, a security or any other type of financial or investment instrument in any jurisdiction.
Please read these Terms carefully before making any decision to purchase any IND Tokens. These Terms are not a prospectus or -1-
offer document and are not a solicitation for investment in Indorse or in any product, project, or property of Indorse in any jurisdiction. These Terms do not constitute an offer of securities in any jurisdiction. Nothing in these Terms should be considered as a recommendation for any person to participate in the sale of IND Tokens or Indorse’s proposed service.
Please note that certain commercial, technical, regulatory, financial, and market risks associated with the commercial transactions governed by these Terms are described in these Terms, including the attached Schedule 2 (Risk Disclosure). It is important that you read these Terms carefully. If you do not understand or have any doubt about any information contained in these Terms, you should consult your legal, tax, financial, or other professional advisers. If you do not agree to these Terms, you must not accept these Terms or purchase any IND Tokens. Your -2-
acceptance of these Terms does not guarantee that you will be able to purchase any IND Tokens during the sale of IND Tokens.
Indorse reserves the right in its discretion to amend any part of these Terms at any time. Please monitor the Indorse website at https://indorse.io for any changes to these Terms and any announcements relating to the sale of Tokens that may supplement or vary these Terms.
In these Terms, Indorse and the contracting party identified in Clause 2.1 below (“you”) agree as follows:
1.
Introduction
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1.1
Indorse is developing an online service platform also known as
Indorse (the “Platform”). The Platform will offer professional social network services to individual users, corporations, or any other organisations, and advertising and other business-oriented services (collectively, “Business Services”) to business customers. The Platform is designed to operate on the Ethereum blockchain platform (“Ethereum”), a decentralised, global, peer-to-peer network of independently operated nodes that provides distributed ledger and virtual machine functionality that supports, among other things, smart contracts and cryptographic tokens.
1.2
A central feature of the Platform is the IND Token that will be the
only form of payment accepted by the Platform for purchases of Business Services. IND Tokens will be designed to meet the ERC-20 Token Standard and will be freely transferable among Ethereum account holders. For purposes of these Terms, the ERC-20 Token Standard refers -4-
to the set of criteria (including criteria in relation to functions and events) developed by the Ethereum community which has to be met in a smart contract on a blockchain in order to enable inter-operability across multiple interfaces and distributed applications. A portion of the IND Tokens paid to the Platform will be distributed to Platform users as an incentive to use the Platform.
1.3
To broaden adoption and support of the Platform, Indorse is
conducting a sale of IND Tokens (the “Token Sale”) during the Pre-Sale Period and Sale Period whereby eligible purchasers (see Clause 2.2 below) may use designated virtual currencies to buy IND Tokens (see paragraph 4 of Schedule 1 (Details of Token Sale)). Concurrently with the Token Sale, Indorse will provide IND Tokens to its founders and certain technical, financial, and advisory supporters (see paragraph 7 of Schedule 1 (Details of Token Sale)). Indorse intends to use the proceeds of the Token Sale for the purposes described in paragraph 14 of Schedule -5-
1 (Details of Token Sale), and Indorse reserves the right to use the proceeds from the Token Sale for any other purposes as Indorse may determine in its sole and absolute discretion.
1.4
The expected utility and value of the Platform and the IND Tokens
are important considerations for prospective purchasers of IND Tokens. As Indorse makes clear throughout these Terms, Indorse does not guarantee that the Platform or the IND Tokens will have a specific, or any, utility or value. By participating in the Token Sale or purchasing IND Tokens, you are deemed to have accepted these Terms and you acknowledge that you have read and understood these Terms, including Schedule 2 (Risk Disclosure) which describes in detail many of the risks that could adversely affect or eliminate the utility and value of the Platform and the IND Tokens. As provided in Clause 5.8 below, your payment to Indorse is not refundable even if the Platform and the IND Tokens have no utility or value. -6-
1.5
Descriptions of the Platform and the IND Tokens, and other
information about Indorse, the Token Sale, and Indorse’s overall project related to the Platform are available on the Indorse website at www.indorse.io, including Indorse’s White Paper version 1.0 and subsequent versions (the “Indicative Project Documentation”). The Indicative Project Documentation states Indorse’s current view of the subjects it covers. Indorse may from time to time revise the Indicative Project Documentation in any respect and without notice to or approval from you. The information presented in the Indicative Project Documentation is indicative only, and the Indicative Project Documentation does not form part of these Terms.
2.
Contracting Party and Eligibility to Participate in the Token
Sale
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2.1
The party that is legally bound by these Terms (and that is
identified in these Terms as ‘you’) is either:
(a)
the individual who accepted these Terms by the process
designated at https://presale.indorse.io (the “Signatory”), or
(b)
the individual or entity, if any, that legally authorised the
Signatory to accept these Terms on its behalf (the “Principal”).
If the Signatory asserts there is a Principal but the individual or entity identified as the Principal (i) does not fully satisfy the Eligibility Conditions under Clause 2.2 below or (ii) is for any reason not legally bound to these Terms, then the Signatory will be bound to these Terms in his or her personal capacity.
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2.2
To be eligible to participate in the Token Sale, you must satisfy each
of the following conditions (the “Eligibility Conditions”):
(a)
If you are an individual, you must:
(i)
be above the minimum age in your jurisdiction to have
the legal capacity to enter into contracts and to use, hold, trade, buy, or sell IND Tokens, and
(ii)
not be a citizen or permanent resident of, or have a
primary residence in, or be physically located in the United States of America or its territories or possessions.
OR
If you are an entity, you must: -9-
(i)
be duly organised and validly existing under the
applicable laws of the jurisdiction of your organisation,
(ii)
have duly authorised your Signatory to accept these
Terms on your behalf, and
(iii) not be a resident for tax purposes of, or have a domicile in, or be physically located in, or otherwise be subject to the jurisdiction of the United States of America or its territories or possessions.
(b)
Your participation in the Token Sale and your using, holding,
trading, buying, or selling IND Tokens must not be prohibited, restricted, or regulated by any law or regulation applicable to you. You are solely responsible (i) to determine if there are any such - 10 -
laws or regulations (including foreign exchange restrictions) applicable to you and to comply with them and (ii) to determine if there are any governmental or other consents or approvals which you need to obtain and to obtain and maintain them.
(c)
You must not be a Specially Designated National as identified
by the Office of Foreign Assets Control of the U.S. Treasury Department; or on the Consolidated List of Targets maintained by the U.K. Office of Financial Sanctions Implementation of HM Treasury; or on the consolidated list of persons, groups and entities subject to financial sanctions maintained by the European Union; or on an equivalent or similar list maintained by the United Nations Security Council, or Singapore or any other jurisdiction.
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(d)
You must purchase the IND Tokens as principal and for your
own account, and not as nominee or agent for, or for the account of, any other person.
(e)
You are a sophisticated purchaser who understands the
technology and risks of cryptographic tokens, particularly the risks associated with your private keys being lost, stolen, or compromised. You must understand how cryptocurrency wallets and other token storage mechanisms work, the risks of using them, and the risks of using them incorrectly. You must understand smart contract technology and blockchain technology and the limitations and risks of systems built using those technologies.
2.3
If you do not fully satisfy each of the Eligibility Conditions at all
times from the time that you accept these Terms, then you may not, and you agree not to, participate in the Token Sale or purchase IND Tokens. - 12 -
If you participate in the Token Sale or purchase IND Tokens notwithstanding that you do not meet each of the Eligibility Conditions, you acknowledge that (a) your participation in the Token Sale or purchase of IND Tokens would be a breach of these Terms (including Clause 7), (b) you proceed with your Order at your own risk, and (c) Indorse may reject, refuse, or cancel your Order at any time without notice to you. Without prejudice to Clauses 10.1 and 11.1 below, you acknowledge and agree that Indorse will not be liable to you or any other party arising from or in connection with your participation in the Token Sale where you do not meet each of the Eligibility Conditions.
2.4
Indorse may require you to provide certain information to confirm
your satisfaction of the Eligibility Conditions and to complete the transactions related to the Token Sale. If you do not provide the required information then you may be unable to participate in the Token Sale or purchase IND Tokens. Indorse’s request for, and your provision - 13 -
of, any information from you, and any actions or decisions Indorse may take based on that information, do not affect your obligations under Clause 2.3.
2.5
If you place more than one Order for IND Tokens during the Token
Sale, each Order creates an individual and separate agreement between Indorse and you. The refusal, rejection, or cancellation of one of your Orders under these Terms shall not affect the continuation in force of any of your other Orders, which will continue to be governed by these Terms.
3.
The Token Sale Smart Contract System
3.1
Key elements of the Token Sale are implemented in smart contracts
deployed on Ethereum (the Token Sale smart contract system or the “SSC System”). The SSC System is open source and available for - 14 -
inspection here: https://github.com/indorseio. The executable source code of the SSC System is incorporated into these Terms by this reference. For the avoidance of doubt, the comments and other nonexecutable code in the source code of the SSC System are for convenience only and are not incorporated into these Terms.
3.2
You understand the nature of smart contracts and that, once
deployed, their functionality cannot be overridden or bypassed. Accordingly, to the extent the execution of the SSC System produces results that conflict with any term or statement of these Terms, the Indicative Project Documentation, or any other document provided by or on behalf of Indorse (all, collectively, the “Off-Chain Documents”), or to the extent the Off-Chain Documents contain a term or statement that could have been implemented in the SSC System but was not, the SSC System will prevail.
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3.3
A technical expert engaged by Indorse (the “Code Auditor”)
completed its audit of the SSC System on 24 July 2017. However, the audit is intended only to enhance the performance and security of the SSC System. Neither Indorse nor the Code Auditor warrants or guarantees the operation of the SSC System.
4.
The IND Tokens
4.1
The Platform is designed to offer Business Services. Business
customers purchasing Business Services will be required to pay with IND Tokens; the Platform will not accept other forms of payment for Business Services. A portion of the IND Tokens paid to the Platform will be allocated to an account (the “User Distribution Account”) and periodically distributed to Platform users as an incentive to use the Platform. Indorse hopes that secondary markets develop for IND Tokens so that (a) business customers can obtain the IND Tokens they will use to - 16 -
pay for Business Services and (b) users and other holders of IND Tokens can obtain other forms of value if they choose not to hold or use IND Tokens with the Platform.
4.2
Your use of the Platform and the IND Tokens will be subject to the
Platform’s terms of use and the other terms and policies referenced therein that are in effect at the time you use the Platform or the IND Tokens (collectively, the “Platform Agreement”). Indorse may update and amend the Platform Agreement from time to time according to the process set out in the Platform Agreement. If there is a conflict between the Platform Agreement and any Off-Chain Document, the Platform Agreement will prevail with respect to any issues relating to the use of the IND Tokens in connection with the Platform. If you do not accept the terms of the Platform Agreement, you will not be able to use the Platform or the IND Tokens you hold.
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4.3
The IND Tokens do not confer ownership, governance, equity,
participation, conversion, redemption, liquidation, or similar rights over, or rights in the revenues, profits, or other financial aspects of, Indorse, the Platform, or any technology or intellectual property developed, acquired, or licensed by Indorse. The IND Tokens do not constitute, and are not intended to be, a security or any other kind of financial or investment instrument in any jurisdiction.
4.4
Holders of IND Tokens will not be able to use them on the Platform
until the Platform has been deployed on the Ethereum mainnet (“Launch”). Indorse plans for Launch to occur about 18 months after the Sale End Time, but does not guarantee when Launch will occur, if at all. Even after Launch, the availability of Business Services will be limited and not all holders of IND Tokens will be able to use them immediately and Indorse will make appropriate announcements of the number of IND Tokens that can be used as payment for Business Services. The Platform - 18 -
will accept IND Tokens as payment for Business Services on an asavailable, first-come-first-served basis.
5.
The Token Sale
5.1
Indorse will conduct the Token Sale only through its website at
https://indorse.io/ (the “Sale Site”). [However, the Pre-Sale (as defined in Schedule 1 (Details of Token Sale) will also be conducted on the PreSale site at https://presale.indorse.io (the “Pre-Sale Site”)]. Important information about the Token Sale is set out in Schedule 1 (Details of Token Sale), including the dates of the Token Sale, pricing, payment instructions, the IND Token distribution process, and Indorse’s expected use of the Token Sale proceeds. If you fail to follow the instructions or observe the other information about the Token Sale in Schedule 1 (Details of Token Sale), on the Pre-Sale Site, or on the Sale Site, you may
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be delayed or prevented from participating in the Token Sale and you may not be able to purchase IND Tokens.
5.2
The Pre-Sale Site and the Sale Site are the only sites authorised by
Indorse to provide information about the Token Sale. Before obtaining the Payment Address (as defined in Schedule 1 (Details of Token Sale)) to which you must submit your payment, you must confirm that your web browser shows “https://presale.indorse.io” (for the Pre-Sale) and “https://indorse.io” and that your https connection is secure. If you have submitted your payment to an address obtained from any other site you may lose the entire amount of your payment and/or may not receive the IND Tokens you intend to purchase. Indorse is not affiliated with and takes no responsibility for any such other sites. To avoid submitting your payment to an incorrect address, you must also verify the address at https://etherscan.io.
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5.4
Your acceptance of these Terms does not guarantee that you will be
able to purchase any IND Tokens during the Token Sale.
5.5
To receive the IND Tokens you purchase, you must have an
Ethereum account that supports ERC-20 Token Standard for which you know the address, and a wallet or other token storage mechanism that is compatible with that account. That account must be fully operational, secure, and valid at the time you place your Order and the time Tokens are distributed to you under Clause 5.6(d). You are in all respects solely responsible for creating that account, obtaining and operating that wallet or token storage mechanism, and safeguarding the private keys, passwords, and other credentials relating to that account and wallet or token storage mechanism. Indorse reserves the right to prescribe additional account requirements.
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5.6
The process for fulfilling your order for IND Tokens in the Token
Sale is as follows (capitalised terms used but not defined in this Clause 5.6 are defined in Schedule 1 (Details of Token Sale)):
(a)
You must visit the Pre-Sale Site (for the Pre-Sale) or the Sale
Site (for the Main Sale), accept these Terms, and obtain the Payment Address.
(b)
You must, during the Pre-Sale Period (for the Pre-Sale) and
the Sale Period (for the Main Sale), submit to the Payment Address your payment for the number of IND Tokens you wish to purchase (the “Purchase Price”), and other information as required on the Pre-Sale Site (for the Pre-Sale) or the Sale Site (all, collectively, the “Order”). You must pay the Purchase Price to the Payment Address according to the payment process described in paragraph 10 of Schedule 1 - 22 -
(Details of Token Sale) (the “Payment Process”). If you do not pay the Purchase Price precisely as specified in the Payment Process, you may permanently lose the entire amount of the Purchase Price and you will not receive any IND Tokens. Your failure to include sufficient gas or transaction fees with your payment, network congestion or fault, or other errors in the systems processing your payment could result in your payment being delayed, rejected, or otherwise not processed. You release Indorse from all responsibility and liability for any payment you attempt or intend to make in respect of your Order until such time, if ever, as the payment is Acknowledged (as defined in Clause 5.6(c))
(c)
Your payment of the Purchase Price will be “Acknowledged”
if and only if 30 blocks in Ethereum have been mined after the block that includes your transaction to transfer the Purchase Price to the Payment Address. If for any reason your payment is not - 23 -
Acknowledged, you will not be able to purchase IND Tokens in the Token Sale. For the avoidance of doubt, you will not receive notice that your payment has or has not been Acknowledged, and your payment becoming Acknowledged does not guarantee that your Order is or will be Accepted (see Clause 5.6(d)). Indorse and the SSC System may for any reason refuse, reject, or cancel your Order even after your payment is Acknowledged. Indorse is not obligated to notify you of the reasons for its decision not to transact with you.
(d)
If the Token Sale has not been cancelled under Clause 5.7 and
you are one of the participants in the Token Sale whose Order Indorse has accepted in its discretion (“Accepted”), then after the Sale End Time the SSC System will distribute the number of IND Tokens specified in your Order in accordance with paragraph 12 of Schedule 1 (Details of Token Sale).
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5.7
Indorse may for any reason and at any time before the Sale End
Time suspend or cancel the Token Sale. If at the Sale End Time the aggregate proceeds of the Token Sale do not equal or exceed the Minimum Sale Threshold, Indorse will cancel the Sale. Indorse will post a notice of the suspension (and resumption, if any) or cancellation on the Sale Site. If Indorse cancels the Token Sale after your payment has been Acknowledged, Indorse will refund your payment according to Clause 5.9.
5.8
Indorse does not have access to or control over your payment until
it is Acknowledged; you accept sole responsibility for all risks related to your payment before it is Acknowledged. If your Order is Accepted, the transaction is final and no refund of payment or cancellation of Order will be made for any reason, except as provided in Clause 5.9(a).
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5.9
Indorse will refund your Acknowledged payment only as provided
in Clause 5.9(a) and only according to the process set out in Clause 5.9(b).
(a)
Indorse will refund your Acknowledged payment only if
Indorse determines, in its discretion, (i) to refuse, reject, or cancel your Order under Clause 5.6(c), (ii) to cancel your Order under Clause 5.10, or (iii) to cancel the Token Sale under Clause 5.7.
(b)
If you are entitled to a refund under Clause 5.9(a), and:
(i)
if your payment was in Ether (ETH), Indorse will
transfer an amount in ETH equal to your payment (less an amount reasonably determined by Indorse to be needed to pay for the gas required to execute the refund transaction) to
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the same Ethereum account from which you made your payment; or
(ii)
if your payment was in Bitcoin (BTC), Indorse will
transfer an amount in BTC equal to your payment (less an amount reasonably determined by Indorse to be needed to pay the transaction fee required to execute the refund transaction) to the same bitcoin address from which you made your payment.
(c)
When the refund transfer described in Clause 5.9(b)(i) or (ii)
is included in a mined block of the Ethereum or Bitcoin blockchain, as the case may be:
(i)
Indorse’s obligation to refund your Acknowledged
payment under Clause 5.9(a) is completely satisfied; - 27 -
(ii)
Indorse has no further obligations to you under this
Agreement in respect of your payment or Order; and
(iii) you, for and on behalf of all natural and legal persons who may claim through or under you, on your behalf, or otherwise in respect of you, release and forever discharge Indorse and its affiliates, and its and their respective directors, officers, employees, agents, representatives, suppliers, attorneys, and advisers, from all claims and causes of action of any kind whatsoever, common law, statutory, contractual, tortious, equitable, or otherwise, and all losses, damages, taxes, liabilities, costs, and expenses, which you have, ever had, may have, or hereafter might have, known or unknown, now existing or which might arise or accrue hereafter, relating to or arising under these Terms or any - 28 -
action or transaction under or contemplated by these Terms in respect of your payment or Order.
(d)
Under no circumstances is Indorse obligated to pay you
interest on your refunded Acknowledged payment, or to pay you in fiat currency or any other form of virtual currency in lieu of the amount refundable to you under this Clause 5.9.
5.10 Indorse may at any time, including after Indorse has delivered IND Tokens to you to fulfil your Order, require you to provide documents and information that Indorse determines in its discretion to be required to enable Indorse to satisfy its obligations under applicable laws and regulations regarding anti-money laundering or countering the financing of terrorism or otherwise requiring Indorse to vet the parties it transacts with. If you do not provide documents and information satisfactory to Indorse in its discretion, or if after receiving your documents and - 29 -
information Indorse determines in its discretion not to transact with you, Indorse will cancel your Order and refund your Acknowledged payment and, if it has already delivered IND Tokens to you, require you to transfer those IND Tokens to Indorse, which you agree to do immediately (and in any event within five days from the date of Indorse’s notice of cancellation of your Order). Indorse is not obligated to notify you of the reasons for its decision not to transact with you or to disclose the content or source of other information that Indorse may have relied on to make its decision. 5.11 If you attempt to double spend ETH or BTC in making payment for your Order, Indorse will cancel your Order and you will not receive any IND Tokens. For purposes of these Terms, an attempt to “double spend” means an attempt to undertake two different transactions on the ETH or BTC network and spending the same account balance on each of the transactions.
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6.
Use of Proceeds
6.1
Indorse intends to use the proceeds of the Sale, together with the
proceeds of sales of IND Tokens that occur before or concurrently with the Sale, as described in paragraph 14 of Schedule 1 (Details of Token Sale). However, Indorse may in its discretion use those proceeds for any purpose, whether or not consistent with the foregoing. Indorse makes no undertaking, representation, or warranty in respect of its use of those proceeds.
7.
Your Representations and Warranties
7.1
By participating in the Token Sale or purchasing IND Tokens, you
represent and warrant to Indorse as follows:
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(a)
You satisfy in full each of the Eligibility Conditions at all times
from the time that you accept these Terms.
(b)
You are purchasing the IND Tokens only for the purpose of
using the IND Tokens in the Platform as described in Clause 4.1 and supporting the development of the Platform, being aware of the risks set out in Schedule 2 (Risk Disclosure). You are not purchasing the IND Tokens for investment, speculative, or other financial purposes, and you understand the IND Tokens are not, and do not represent, shares, debentures, units in a collective investment scheme, options, futures, or derivatives in Indorse or in any other existing or future legal entity, scheme, project, or property in any jurisdiction.
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(c)
You have carefully read in full, and fully understand, these
Terms, including Schedule 1 (Details of Token Sale) and Schedule 2 (Risk Disclosure).
(d)
You have carefully reviewed in full, and fully understand, the
source code of the SSC System available at https://github.com/indorseio . To the extent the SSC System may operate in a manner that is inconsistent with these Terms, you accept those inconsistencies and understand that the operation of the SSC System will supersede these Terms to the extent of any such inconsistency and will not be a breach of these Terms.
(e)
You have carefully read in full, and fully understand the Off-
Chain Documents and are satisfied with the quality and quantity of the information available to you concerning Indorse, the Platform,
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the IND Tokens, and the Sale, and that you have made a fully informed decision to participate in the Sale.
(f)
You have confirmed, personally or based on the advice of a
qualified legal adviser engaged by you, that your participation in the Token Sale and your using, holding, trading, buying, or selling IND Tokens are not prohibited, restricted, or regulated by any law or regulation applicable to you.
(g)
You have confirmed, personally or based on the advice of a
qualified tax adviser engaged by you, and you fully understand, accept, and will discharge in full, the tax implications of your participation in the Token Sale and your using, holding, trading, buying, or selling IND Tokens.
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(h)
Your placement of an Order constitutes your acceptance of
the risks related to the Platform, the IND Tokens, and the Token Sale as described in these Terms, including in Schedule 2 (Risk Disclosure).
(i)
The ETH and/or BTC you submit as payment in the Token
Sale are legitimately owned by you and have not been obtained in violation of any anti-money laundering, countering the financing of terrorism, or other applicable law or regulation.
(j)
You will not use the IND Tokens you receive in the Sale, if any,
in violation of any anti-money laundering, countering the financing of terrorism, or other applicable law or regulation.
(k)
If you are a Principal, you have authorised your Signatory to
accept these Terms on your behalf. - 35 -
(l)
These Terms constitute your legal, valid, and binding
obligations, enforceable against you in accordance with their terms.
7.2
You confirm that your representations and warranties in Clause 7.1
are and will remain correct at all times from the time of your acceptance of these Terms.
8.
Tax
8.1
You bear sole responsibility for determining if your participation in
the Sale, your using, holding, trading, buying, or selling IND Tokens, the potential appreciation or depreciation in the value of IND Tokens over time (if any), the allocation and distribution of IND Tokens, and/or any other action or transaction under or contemplated by these Terms have tax implications for you. - 36 -
8.2
The Purchase Price is exclusive of all taxes that are applicable to
your using, holding, trading, buying, or selling IND Tokens in any jurisdiction (“Tax”).
8.3
You are solely responsible for determining any Tax payable by you
and declaring, withholding, collecting, reporting, and remitting the correct amount of Tax to the appropriate tax authorities. You will be solely liable for all penalties, claims, fines, punishments, or other liabilities arising from the non-fulfilment or non-performance to any extent of any of your obligations in relation to any Tax.
8.4
Indorse is not responsible for determining any Tax nor for
declaring, withholding, collecting, reporting, or remitting the correct amount of Tax to the appropriate tax authorities.
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8.5
To the extent permitted by applicable laws and regulations, you
agree not to hold any third party (including developers, auditors, contractors, or founders) liable for any tax liability associated with or arising from your using, holding, trading, buying, or selling IND Tokens or any action or transaction under or contemplated by these Terms.
8.6
You will provide Indorse with any information it may reasonably
request to determine whether it is obligated to collect any goods and services tax or other tax from you.
8.7
Indorse does not give any advice on tax-related matters and makes
no representation or warranties as to the tax implications, if any, of your participation in the Token Sale or your using, holding, trading, buying, or selling IND Tokens. It is your responsibility to consult your tax advisers before purchasing IND Tokens.
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9.
Intellectual Property
9.1
These Terms do not entitle you to any intellectual property rights,
including rights in relation to the use, for any purpose, of any information, image, user interface, logos, trademarks, trade names, Internet domain names, or copyright, in connection with Indorse, the IND Tokens, the Pre-Sale Site, or the Sale Site.
9.2
Ownership of IND Tokens carries no express or implied rights
other than the right to use IND Tokens as a means of payment for Business Services within the Platform, if successfully completed and deployed. In particular, you agree and acknowledge that you have no right, as holder of any IND Tokens, to claim any intellectual property rights or equivalent rights or any other form of participation in or relating to the Platform, the SSC System, and/or Indorse.
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9.3
Indorse retains all right, title, and interest in all of its intellectual
property, including inventions, discoveries, processes, marks, methods, compositions, formulae, techniques, information and data, whether or not patentable, copyrightable, or protectable in trademark, and any trademarks, copyrights, or patents based thereon. You may not use any of Indorse’s intellectual property for any reason, except with its express prior written consent.
10. Indemnification
10.1 To the maximum extent permitted by all applicable laws and regulations, you will indemnify, defend, and hold harmless Indorse and its past, present and future employees, officers, directors, contractors, consultants, members, suppliers, vendors, service providers, parent companies, subsidiaries, affiliates, licensors, agents, representatives, predecessors, successors, and assigns from and against all claims, - 40 -
demands, actions, damages, losses, costs, and expenses (including legal fees) that arise from or relate to (a) your participation in the Sale, (b) your using, holding, trading, buying, or selling IND Tokens, (c) your responsibilities or obligations under these Terms, (d) your violation of these Terms, or (e) your violation of any rights of any other person or entity in connection with the Token Sale or your using, holding, trading, buying, or selling IND Tokens. This indemnity is in addition to, and not in lieu of, any other remedies available to Indorse under law, equity or a written agreement between you and Indorse.
10.2 If Indorse is obligated to respond to a subpoena or other compulsory legal or court order or process relating to subject matter that is within the scope of your indemnity under Clause 10.1, you agree to reimburse Indorse its reasonable legal fees, as well as its employees’ and contractors’ time and materials spent responding to the subpoena or
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other compulsory legal or court order or process at reasonable hourly rates.
10.3 Indorse will promptly notify you of any third party claim subject to Clause 10.1, but Indorse’s failure to promptly notify you will only affect your obligations under Clause 10.1 to the extent that its failure prejudices your ability to defend the claim. You may (a) use counsel of your own choosing (subject to Indorse’s written consent) to defend any such claim and (b) settle the claim as you deem appropriate, provided that you obtain Indorse’s prior written consent before entering into any settlement. Indorse reserves the right, at your expense, to exercise sole control of the defence of the claim and to settle the claim at any time.
11. Disclaimers and Release
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11.1 To the maximum extent permitted by all applicable laws and regulations and except as otherwise provided in these Terms, Indorse (and, with respect to the SSC System, the Code Auditor) hereby expressly disclaims its liability and shall in no case be liable to you or any person for:
(a)
refusal, rejection, or cancellation of your Order under Clause
5.6(c), or cancellation of your Order under Clause 5.10 or 5.11;
(b)
cancellation of the Token Sale under Clause 5.7;
(c)
delay in the distribution of IND Tokens under Clause 5.6(d);
(d)
failure or malfunction of, or disruption to, the operation of
the Platform or the SSC System in connection with the IND Tokens;
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(e)
delay in the refund of your Acknowledged payment under
Clause 5.9;
(f)
any payment for Orders made to an address other than the
Payment Address;
(g)
a hard fork, failure, or malfunction of, or disruption to, the
operation of Ethereum, Ethereum-based software systems, blockchain technology generally, or other decentralised technology or systems in respect of the Platform or the IND Tokens;
(h)
any virus, error, bug, flaw, defect, or other matter adversely
affecting the operation, functionality, usage, storage, transmission mechanisms, transferability, tradability, or other material characteristics of the IND Tokens;
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(i)
decreases or volatility in traded prices or trading volume of
IND Tokens (after listing and quotation of IND Tokens on secondary digital token exchanges, if applicable);
(j)
failure or unfitness of the IND Tokens for any specific
purpose;
(k)
Indorse’s use of the proceeds of the Sale;
(l)
any failure or delay in disclosing information relating to the
status of the Sale;
(m) loss, destruction, theft, or compromise of the private keys, passwords, or other credentials to the account or wallet or other token storage mechanism referred to in Clause 5.5;
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(n)
failure or delay in the listing or quotation of the IND Tokens
on a cryptocurrency exchange;
(o)
any delisting of the IND Tokens from a cryptocurrency
exchange;
(p)
any loss, cost, expense, or tax associated with any transfer or
secondary market trading in the IND Tokens;
(q)
any prohibition, restriction, or regulation by any government
or regulatory authority in any jurisdiction of the operation, functionality, usage, storage, transmission mechanisms, transferability, tradability, or other material characteristics of the IND Tokens;
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(r)
failure or delay to achieve the outcomes described in the
Indicative Project Documentation;
(s)
any forward-looking statements of any nature made in
connection with the Sale, the IND Tokens, the Platform, or otherwise;
(t)
any risks associated with the SSC System, the Off-Chain
Documents, the Pre-Sale Site, the Sale Site, Indorse, the Token Sale, the IND Tokens, your using, holding, trading, buying, or selling IND Tokens, or your use of the Platform, including the risks set out in Schedule 2 (Risk Disclosure); and
(u)
any delay or failure to perform any obligation under these
Terms where the delay or failure results from any cause beyond Indorse’s control, including acts of God, labour disputes or other - 47 -
industrial disturbances, electrical, telecommunications, hardware, software or other utility failures, earthquake, storms or other elements of nature, blockages, embargoes, riots, acts or orders of government, acts of terrorism, or war, changes in blockchain technology (broadly construed), and changes in the Ethereum protocols.
11.2 To the maximum extent permitted by all applicable laws and regulations and except as otherwise specified in writing by Indorse (a) IND Tokens are sold on an “as is” and “as available” basis without warranties of any kind, and Indorse expressly disclaims all representations, warranties, and conditions (express or implied, whether by statute, common law, custom, usage, or otherwise) regarding itself, the Platform, the IND Tokens, the Sale, the SSC System, these Terms, and the transactions contemplated by these Terms, (b) Indorse does not represent or warrant that IND Tokens, the SSC System, or the Platform - 48 -
are or will be reliable, current, or error-free, fit for a particular purpose, meet your requirements, or that any defects in IND Tokens, the SSC System, or the Platform will be corrected, and (c) Indorse cannot and does not represent or warrant that the IND Tokens, the SSC System, or the Platform or the delivery mechanism for IND Tokens, the SSC System, or the Platform are free of viruses or other harmful components or that they do not contain any weaknesses, vulnerabilities, or bugs which could cause, among other things, the complete loss of ETH, BTC, and/or IND Tokens.
11.3 To the maximum extent permitted by all applicable laws and regulations, you, for and on behalf of all natural and legal persons who may claim through or under you, on your behalf, or otherwise in respect of you, release and forever discharge Indorse and its affiliates, and its and their respective directors, officers, employees, agents, representatives, suppliers, attorneys, and advisers, from all claims and - 49 -
causes of action of any kind whatsoever, common law, statutory, contractual, tortious, equitable, or otherwise, and all losses, damages, taxes, liabilities, costs, and expenses, which you have, ever had, may have, or hereafter might have, known or unknown, now existing or which might arise or accrue hereafter, relating to or arising from the matters listed in Clause 11.1.
12. Limitations of Liability
12.1 To the maximum extent permitted by all applicable laws and regulations and except as otherwise provided in these Terms:
(a)
Indorse shall not be liable for any loss of revenue, income, or
profits; or any indirect, special, incidental, reliance, consequential, punitive, or other losses or damages of any kind, in tort, contract, strict liability, or otherwise (including loss of use, data, or tokens), - 50 -
arising out of or in connection with these Terms or your using, holding, trading, buying, or selling IND Tokens, even if Indorse has been advised of the possibility of such losses or damages;
(b)
the aggregate liability of Indorse, in tort, contract, strict
liability, or otherwise, arising out of or in connection with these Terms and your using, holding, trading, buying, or selling IND Tokens shall be limited to the amount of your Acknowledged payment hereunder or the ETH equivalent of Five Hundred Singapore Dollars (SGD500), whichever is lower; and
(c)
you agree to waive all rights to assert any claims under
applicable laws and regulations and you agree that you may make claims based only on these Terms.
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12.2 The limitations of liability in this Clause 12 protect Indorse’s affiliates, and the directors, officers, employees, agents, advisers, and representatives of Indorse and its affiliates, to the same extent that Indorse is protected.
12.3 You acknowledge that Indorse has entered into these Terms in reliance on the disclaimers and limitations of liability in these Terms, and that the same form an essential basis of the bargain between you and Indorse.
13. Governing Law and Dispute Resolution
13.1 These Terms are governed by and will be construed in accordance with the laws of the Republic of Singapore, without regard to its conflict of law rules.
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13.2 Any dispute, claim, suit, action, cause of action, demand, or proceeding arising out of or related to these Terms (including in respect of their validity, existence, or termination), any action or transaction under or contemplated by these Terms, or your using, holding, trading, buying, or selling IND Tokens (collectively, “Disputes”) that is not settled by the parties within 30 days from the date that either party notifies the other party in writing of the Dispute, shall be referred to and finally settled by arbitration in Singapore under the rules of the Singapore International Arbitration Centre (“SIAC”) then in force, which rules are deemed to be incorporated by reference into this Clause. The number of arbitrators shall be three. Each party shall nominate one arbitrator and the third arbitrator shall be appointed in accordance with the SIAC rules. The arbitration shall be conducted in English.
13.3 Any Dispute is personal to you and Indorse and will not be brought as a representative action, class action, or any other type of - 53 -
representative proceeding. You agree not to join with any other individual or entity or group of individuals or entities for the purpose of seeking to resolve the respective Disputes on a consolidated or representative basis.
14. General
14.1 A reference in these Terms to “these Terms” shall include a reference to Schedule 1 (Details of Token Sale) and Schedule 2 (Risk Disclosure) and other documents and terms which are expressly incorporated into these Terms by reference. Schedule 1 (Details of Token Sale) and Schedule 2 (Risk Disclosure) form integral parts of these Terms.
14.2 In these Terms, words of any gender include the corresponding words of each other gender. The terms “include”, “includes”, and - 54 -
“including” will be interpreted to be followed by “without limitation”. The term “discretion” means “sole and absolute discretion” unless otherwise qualified. Any headings in these Terms are for convenience only and shall not affect the construction or interpretation of these Terms.
14.3 Nothing in these Terms is intended to or will constitute you or Indorse as an agent, fiduciary, legal representative, partner, joint venturer, franchisee, employee, or servant of the other for any purpose.
14.4 You may not assign any of your rights or obligations under these Terms to any other person without the prior written consent of Indorse, which Indorse may grant or withhold in its discretion. You may not assign any right or interest you have in an Acknowledged payment or Order. Indorse may assign any of its rights or obligations under these Terms without requiring your prior written consent. - 55 -
14.5 All notices required or permitted under these Terms and all approvals, consents, and waivers must be in writing in the English language and must be delivered by a method providing for proof of delivery. Any such communication will be deemed to have been given on the date of receipt. Indorse will accept notices from you by email at
[email protected].
14.6 If you are an individual, Indorse will use any personal information you provide to Indorse only for the following purposes:
(a)
to process and complete your Order;
(b)
to send you promotional and marketing information
regarding any future sale of IND Tokens, the Platform, or other Indorse events, products, and services; - 56 -
(c)
to protect our rights and property, and the rights, property,
and safety of others;
(d)
to prevent and detect security threats, fraud, or other
malicious activity; and
(e)
to comply with our legal obligations, resolve disputes, and
enforce our agreements.
14.7 Notwithstanding the expiry of the Pre-Sale Period or the Sale Period, any distribution of IND Tokens to you, any cancellation of the Token Sale under Clause 5.7, or any refund of your Acknowledged payment under Clause 5.9, Clauses 7 (Your Representations and Warranties), 9 (Intellectual Property), 10 (Indemnification), 11 (Disclaimers), 12 (Limitation of Liability), 13 (Governing Law and - 57 -
Dispute Resolution), and 14 (General), and Schedule 2 (Risk Disclosure) shall remain valid and in full force and effect.
14.8 Indorse’s failure to enforce these Terms or to assert any right, claim, or cause of action against you under these Terms shall not be construed as a waiver of Indorse’s right to assert any right, claim, or cause of action against you.
14.9 Indorse’s waiver of a breach by you of any of these Terms will not be construed as a waiver of any succeeding breach of that Term or as a waiver of that Term itself. Indorse’s performance after any breach by you will not be construed as a waiver of that breach. No course of dealing, course of performance, or failure by Indorse to strictly enforce any of these Terms will be construed as a waiver of any Term.
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14.10
No approval, consent, or waiver in respect of these Terms will
be enforceable unless stated in writing signed by or on behalf of the granting party.
14.11
Indorse reserves the right in its discretion to amend any part
of these Terms at any time. The amendments shall take effect from the time they are posted on the Indorse website at https://indorse.io.
14.12
These Terms represent the entire agreement between you
and Indorse and supersede any earlier oral or written agreements, proposals, representations, statements, and understandings (including the Indicative Project Documentation) between you and Indorse with respect to their subject matter. No terms or representations not expressly included in these Terms will be deemed to apply.
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14.13 Any Dispute is personal to you and Indorse and will not be brought as a representative action, class action, or any other type of representative proceeding. You agree not to join with any other individual or entity or group of individuals or entities for the purpose of seeking to resolve the respective Disputes on a consolidated or representative basis.
14.14 Indorse reserves the right, without notice or limitation, to deny, terminate, modify, throttle, disconnect, or suspend the Token Sale or Pre-Sale if an individual engages in unfair, excessive or abusive usage or if Indorse, at its discretion, determines that action is necessary to protect Indorse from harm or degradation.
14.15 Except as otherwise expressly provided (including under Clause 12.12), a person who is not a party to these Terms will not have any rights under or in connection with them by virtue of the Contracts - 60 -
(Rights of Third Parties) Act (Chapter 53B) of Singapore to enforce any term.
14.16 Each of the terms in these Terms is severable. If a court or other tribunal having jurisdiction determines that any term is illegal, invalid, or unenforceable under applicable law, that determination will not affect the other terms.
14.17 Any translation of these Terms is for reference purposes only. If there is any inconsistency between the English language version of these Terms and any translated version, the English language version shall prevail.
14.18 You agree to do anything (such as obtaining consents, signing and producing documents, producing receipts, and getting documents completed and signed) which Indorse may ask and considers necessary - 61 -
to (a) bind you and any other person intended to be bound in connection with these Terms and the IND Tokens, (b) demonstrate whether you are complying with applicable law and these Terms, (c) enable Indorse to obtain any necessary consent of any other person to these Terms, and (d) comply with its legal, regulatory, and governance requirements.
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Schedule 1 Details of Token Sale
1.
Sale Site
The landing page of the Sale Site is accessible from https://indorse.io.
2.
Pre-Sale Registration
Indorse is conducting a pre-sale program to enable certain persons to purchase IND Tokens at a pre-sale price on a priority basis (the “PreSale”). For this purpose, Indorse accepted non-binding commitments from persons who registered with Indorse during a specified period (“Pre-Sale Registrants”). If you are a Pre-Sale Registrant who received instructions from Indorse regarding the Pre-Sale (an “Accepted PreSale Registrant”), you must follow the instructions provided to you to - 63 -
identify yourself as a Pre-Sale Registrant on the Pre-Sale site and to qualify your Order for the Pre-Sale price and priority processing. If you are not an Accepted Pre-Sale Registrant, or if for any reason you were not able to qualify your Order on the Pre-Sale Site, then you will not be given priority to purchase IND Tokens.
3.
Pre-Sale Period and Sale Period
The Token Sale will be comprised of a Pre-Sale and a main sale of IND Tokens after the Pre-Sale Period (the “Main Sale”). For the avoidance of doubt, the term “Token Sale” refers to the sale of IND Tokens during the Pre-Sale and the Main Sale.
Indorse will accept Orders from Accepted Pre-Sale Registrants only during the period (the “Pre-Sale Period”) that begins at 1100 UTC on 25 July 2017 and ends at 1100 UTC on 3 August 2017 (the “Pre-Sale End - 64 -
Time”). However, if the Pre-Sale cap is reached before the Pre-Sale End Time, then Indorse will stop accepting Orders from Accepted Pre-Sale Registrants.
Indorse will only accept Orders for the Main Sale during the period (the “Sale Period”) that begins at 1100 UTC on 8 August 2017 and ends at 1100 UTC on 7 September 2017 (the “Sale End Time”). However, if the Sale Cap (as defined below) is reached before the Sale End Time, then Indorse may adjust the Sale End Time to an earlier time and date.
Indorse will post a notice of a change in the Pre-Sale End Time on the landing page of the Pre-Sale Site or a change in the Sale End Time on the landing page of the Sale Site.
Orders received by Indorse for the Pre-Sale after the Pre-Sale Period and for the Main Sale after the Sale Period shall be invalid. - 65 -
4.
Accepted Cryptocurrencies
Indorse will only accept ETH and, by special arrangement at Indorse’s discretion, BTC as payment for Orders for the Pre-Sale, and will only accept ETH as payment for Orders for the Main Sale. Indorse will not accept other virtual currencies, digital assets, tokens, or fiat currencies, whether or not legal tender in any applicable jurisdiction, as payment for any Orders.
5.
IND Token Pricing
The price of each IND Token during the Pre-Sale will be 0.0008 ETH (1,250 IND Tokens per 1 ETH) and the price of each IND Token during the Main Sale will be 0.001 ETH (1,000 IND Tokens per 1 ETH).
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There will be no discounts, bonuses, or incentives for early Orders, large Orders, or otherwise.
Orders can be placed for fractional amounts of IND Tokens (see paragraph 6 below regarding the divisibility of IND Tokens).
Indorse reserves the right in its discretion to adjust any part of the IND Token pricing scheme, including the base price of each IND Token, at any time.
6.
Minimum and Maximum Orders
The minimum Order during the Pre-Sale is 100 ETH. There is no minimum Order during the Main Sale.
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There is no maximum Order. However, if your Order would cause the aggregate proceeds from the Token Sale to equal or exceed the Sale Cap (defined in paragraph 9 below), then your Order will be accepted to the extent it does not exceed the Sale Cap and the remaining balance of the Purchase Price will be deemed to be a rejected Order and refunded to you under Clause 5.9.
7.
Creation and Allocation of IND Tokens
The SSC System will mint the initial quantity of IND Tokens after the Sale End Time and after the number of IND Tokens to be issued in respect of each Order is computed (the “Initial IND Tokens”). The Initial IND Tokens will be allocated as follows: 35% for the Token Sale 40% for Indorse’s future issuance 5% for advisors - 68 -
8% for founders 5% for employees and early developers and contributors 5% for marketing and promotion 2% for bounties (for example, for translating Indorse’s White Paper)
Indorse will also be having an Inflation Pool, which will represent the additional IND tokens created. The Inflation Pool will be over and above the token distribution mentioned above.
If Launch occurs, then after an appropriate time period that Indorse deems fit, Indorse will deposit IND Tokens from the Inflation Pool directly into the User Distribution Account for distribution to Platform in a manner that Indorse will deem fit.
Indorse reserves the right to mint and sell IND Tokens in one or more future public and/or private sales. - 69 -
8.
Minimum Sale Threshold
If at the Sale End Time the aggregate payments Acknowledged in respect of the Sale, plus payments received in respect of sales of IND Tokens occurring before or concurrently with the Token Sale, do not equal or exceed 15,000 ETH (the “Minimum Sale Threshold”), Indorse may cancel the Token Sale under Clause 5.7 of these Terms. Indorse may change or waive the Minimum Sale Threshold in its discretion.
9.
Sale Cap
If at any time the aggregate payments Acknowledged in respect of the Token Sale equal or exceed 50,000 ETH (the “Sale Cap”), Indorse may adjust the Sale End Time to end the Token Sale as provided in paragraph 3 above. Indorse may change the Sale Cap in its discretion. - 70 -
10. Payment Process
To pay for your Order, you must send your payment to the Ethereum Name Service name that will be identified on the Pre-Sale Site (for the Pre-Sale) or the Sale Site (for the Main Sale) (the “Payment Address”). Myetherwallet.com is capable of sending payments to the Payment Address. You must include sufficient gas (for payment in ETH) for your payment to be validated by the applicable network. You are solely responsible for ensuring that you direct your payment to the Payment Address. If you do not make your payment to the Payment Address, you may permanently lose the entire amount of your payment and you will not receive IND Tokens.
Indorse accepts no responsibility or liability for any payment you make, attempt or intend to make in respect of Orders (including payments - 71 -
made with myetherwallet.com) until such time, if ever, as the payment is Acknowledged.
11. Payment Intermediaries
Indorse advises you not to use third party payment processors, hosted wallets, or other intermediaries as they may not be compatible with the SSC System and, even if your payment is Acknowledged and your Order is Accepted, you may not receive any IND Tokens. Indorse disclaims all responsibility and liability to you if you use a third party payment processor, hosted wallet, or other intermediary and do not receive IND Tokens.
12. Distribution of IND Tokens
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As soon as practicable after seven days from the Sale End Time, the SSC System will create and distribute IND Tokens to participants in the Token Sale whose Orders have been Accepted and to the other persons and entities to which IND Tokens have been sold or allocated as identified in paragraph 7 above.
If your Order has been Accepted, the SSC System will transfer your IND Tokens to the Ethereum account from which you made payment for your Order unless, by special arrangement at Indorse’s discretion, Indorse agreed to transfer your IND Tokens to a different account.
If your Order has not been Accepted, then your Order will be deemed to have been cancelled under Clause 5.6(c) and your payment will be refunded under Clause 5.9 of these Terms.
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You are in all respects solely responsible for creating the account to which your IND Tokens or refund, as the case may be, will be transferred, and for safeguarding the private keys, passwords, and other credentials relating to that account and any wallet or other token management mechanism you use to manage that account.
13. IND Token Transferability
You may transfer your IND Tokens immediately after they are transferred to you under paragraph 12 above.
The founders, advisors, employees, and early developers and contributors receiving IND Tokens under paragraph 7 above will be restricted from transferring their IND Tokens during the 240-day period immediately following the Sale End Time.
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14. Use of Proceeds
Indorse intends to use the proceeds of the Token Sale, together with the proceeds of sales of IND Tokens that occur before or concurrently with the Token Sale, as follows:
65% for research and development of the Platform
20% for sales and marketing
10% for operations overhead
5% for potential legal and regulatory issues
Whenever possible, Indorse will seek to pay its expenses directly in ETH.
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However, Indorse may in its discretion use those proceeds for any purpose, whether or not consistent with the foregoing. Indorse makes no undertaking, representation, or warranty in respect of its use of those proceeds.
14. Award of SCR Tokens
Purchasers of IND Tokens in the Token Sale may also be awarded SCR tokens at a ratio and at the time that Indorse will deem fit.
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Schedule 2 Risk Disclosure
It is important that you make an informed decision about the Token Sale. You must carefully read and evaluate the risks that Indorse describes in this Schedule 2 (Risk Disclosure).
The realisation of any one or more of the risks described in this Schedule 2 (Risk Disclosure), or other risks whether unforeseen or unforeseeable, could significantly reduce or eliminate the utility or value to you of the Platform and any IND Tokens you hold and you could lose your entire payment amount.
If you do not fully understand or are not comfortable with any of the risks described in this Schedule 2 (Risk Disclosure), you should not participate in the Token Sale. Indorse does not represent that this - 77 -
Schedule 2 (Risk Disclosure) discloses all risks and other significant aspects of the Token Sale, including risks which may be personal to you and thus unknown to Indorse.
Indorse Risks
Indorse Failure. As a consequence of the realisation of one or more of the other risks in this Schedule 2 (Risk Disclosure) or of risks not described in this Schedule 2 (Risk Disclosure), Indorse’s business could fail and Indorse could be wound up or dissolved. If Indorse’s business fails and the Platform is not transferred to and operated by another company, the Platform would terminate and any IND Tokens you hold would have no utility or value. Indorse does not commit that it can or will transfer the Platform to another company if its business fails. If Indorse does transfer the Platform to another company, Indorse does not commit that the other company will operate the Platform to your - 78 -
satisfaction or at all, or will continue to accept IND Tokens for use in the Platform.
Management Failures. Indorse’s management may fail to manage its personnel, finances, facilities, information, technology, and other resources to effectively develop, operate, maintain, support, improve, market, and sell the Platform, or to manage the growth of the Platform or its business, or to adapt the Platform or its business to changes in technology or the markets in which it operates, or to identify and effectively respond to the risks described in this Schedule 2 (Risk Disclosure) or otherwise, the realisation of any or all of which could adversely affect the Platform.
No Governance Rights. IND Tokens confer no governance or similar rights with respect to Indorse or the Platform. Indorse will, at its discretion, make all decisions concerning its business and the Platform, - 79 -
including decisions to fork or discontinue the Platform, to change any pricing, parameter, or feature of the Platform, to subcontract or outsource the operation of the Platform, to sell the Platform, and to sell, merge, or liquidate Indorse, any of which decisions may not be consistent with your expectations or interests.
Business Model Risks. Indorse designed the Platform and the IND Tokens according to a specific business model. If the business model for the Platform is flawed, or if the assumptions underlying that business model are incorrect, the Platform may underperform or fail.
Insufficient Funding. Indorse will depend on the proceeds of the Token Sale to fund its operations until such time, if ever, that Indorse earns sufficient revenue from the Platform or other activities. The proceeds of the Token Sale are cryptocurrencies that may increase or decrease in value. Indorse may, at its discretion, engage in hedging or similar - 80 -
activities to manage the risk of cryptocurrency fluctuations, but those activities may not be sufficient, may fail, or may worsen the consequences of those fluctuations. In addition, the cryptocurrencies held by Indorse may not be convertible to fiat currencies or other cryptocurrencies at rates Indorse considers favourable or at all. The cryptocurrencies held by Indorse are also subject to loss or theft despite security precautions taken by Indorse. If for any reason Indorse’s funds are not sufficient to sustain its operations, Indorse may have to reduce or suspend its operations, which would adversely affect Indorse’s ability to develop and operate the Platform at the intended level or at all.
Unanticipated Risks. The Platform will be launched and will evolve in technology, business, economic, and legal environments that are uncertain and subject to rapid, unpredictable, and potentially contradictory evolution. The future risks associated with those environments, their respective evolutions, and the interactions among - 81 -
them are unknown and unknowable but they could threaten the viability or existence of the Platform.
Product Risks
Delay. Indorse may not develop and deploy the Platform according to its intended schedule. Delays in deploying the Platform may adversely affect the acceptance of the Platform in the market and ultimately the viability of the Platform.
Inability to Use IND Tokens. Holders of IND Tokens will not be able to use them with the Platform until Launch. Launch may be delayed, or may not occur. Even after Launch, the availability of Business Services will be limited and not all holders of IND Tokens will be able to use them immediately. The Platform will accept IND Tokens as payment for Business Services on an as-available, first-come-first-served basis. - 82 -
Failure to Develop and Support the Platform. As a consequence of the realisation of one or more of the other risks in this Schedule 2 (Risk Disclosure) or of risks not described in this Schedule 2 (Risk Disclosure), or because of business decisions taken by Indorse in good faith, Indorse may fail to launch the Platform with a full set of intended features and functions or at all, may discontinue certain features and functions of the Platform, may not improve or add to the features and functions of the Platform over time, may not adequately support the Platform, and may not fix bugs in the Platform in a timely way or at all. The Platform may therefore not have the utility you expect.
Platform Issues. The Platform may be degraded, interrupted, or fail because of hardware, software, or network defects, security breaches, viruses or other malicious code, natural disasters, congestion in
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underlying networks, and other causes. Indorse may be unable to restore the Platform to normal operation in a timely way or at all.
Platform Updates. Indorse may not update the Platform in a timely way or at all to fix bugs, address incompatibilities arising because of changes in underlying technologies and services, respond to user feedback, or react to competitive threats. Any such delays or failures could adversely affect the Platform.
Failure to Meet Expectations. The initial and future versions of the Platform may not meet your expectations regarding features, functions, performance, availability, quality, security, scale, price, or other attributes that are important to you.
Reliance on Third Parties. Indorse relies on third parties it does not control to operate Ethereum and other systems and services on which - 84 -
the Platform depends. Those third parties may be unable or unwilling to act as Indorse needs and expects, may themselves act maliciously, or may be adversely affected by other parties acting intentionally, unintentionally, or maliciously or by other events outside their control. The failure of those third parties to perform according to Indorse’s needs and expectations could adversely affect the Platform.
Privacy Risks. The SSC System and the Platform are built on Ethereum and other public, decentralised platforms. Anyone with internet access can inspect all transactions and other information stored in those platforms that is not encrypted. Your Orders for and transactions involving IND Tokens, and other information about you or that belongs to you that may be processed by or stored in those platforms in connection with your use of the SSC System or the Platform, may be inspected by the public. Certain information may, even if encrypted, be
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associated with you by combining it with other public or non-public information.
Technology Risks
Core Technology Risks. The Platform is built with core technologies that are in some cases immature and unproven, including the Ethereum blockchain platform and various open source software applications and libraries. If those core technologies do not perform according to Indorse’s needs or expectations, have bugs or security vulnerabilities that are not or cannot be fixed, become unstable, degraded, or unavailable, are changed or ‘forked’ in a way that is incompatible with the Platform, or are not further developed or supported, Indorse may be required to change the specifications of the Platform and to reduce or eliminate features and functions that are important to you, or to discontinue the Platform. - 86 -
Integration Risks. The Platform will be integrated with three essential third party services: uPort, Status, and Inter Planetary File System (IPFS) for identity authentication, messaging, and data storage, respectively. If the integrations with those services fail, or those services are unreliable or do not perform as expected, those features within the Platform, or the Platform generally, may be adversely affected or delayed.
Smart Contract Risks. Certain key features of the Platform will be implemented in smart contracts on the Ethereum blockchain platform. The nature of smart contracts makes them difficult to change to fix bugs, improve performance, or add features and functions. Indorse may therefore not correct defects in the Platform or improve the Platform to meet market needs or respond to competition fast enough or at all, which could adversely affect the utility or viability of the Platform.
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Hacking. All software systems, including the Platform, have security vulnerabilities. Malicious actors may disrupt, corrupt, or interfere with the Platform, may defraud Indorse or other stakeholders in the Platform, including you, and may steal IND Tokens or other valuable data stored in the Platform, some of which may belong to or involve you.
Mining Attacks. Certain features of the Platform depend on the Ethereum blockchain platform. Ethereum is a decentralised service comprising a global peer-to-peer network of many independent node operators. Coordination or collusion among node operators could subject the Platform and its stakeholders, including you, to a variety of attacks that could compromise the integrity of the Platform, cause loss, theft, or corruption of IND Tokens and other valuable data stored in the Platform, including yours, or increase the cost of using the platform to levels that make operation of the Platform uneconomic and unsustainable. - 88 -
Security Risks. The security and integrity of essential components of the Platform depend on cryptography. Known and currently unknown weaknesses in the cryptographic algorithms used in the Platform and its underlying core technologies, and advances in techniques or computing power to circumvent those algorithms, may compromise the security and integrity of the Platform, cause the loss, theft, or corruption of IND Tokens and other valuable data stored in the Platform, including yours, and require the suspension or discontinuation of the Platform. The existence or future development of stronger cryptographic algorithms to replace compromised algorithms, and the feasibility of implementing those stronger algorithms in the Platform and its underlying core technologies, is uncertain.
Regulatory Risks
- 89 -
Regulatory Status. The regulatory status of the Platform, the IND Tokens, and the Token Sale is unclear or unsettled in many jurisdictions. Regulators in many jurisdictions have announced their intention to consider the adoption of regulations to cover cryptographic tokens and the markets for them. It is not known if, when, or to what degree different jurisdictions will interpret existing laws and regulations or adopt new laws and regulations that could adversely affect the Platform, the IND Tokens, and the Token Sale, or whether those laws or regulations would be applied retroactively. Adverse laws or regulations and/or the financial and other costs of regulation could cause Indorse to modify or discontinue certain features or functions of the Platform, or cause Indorse to discontinue the Platform in certain jurisdictions or entirely, or make using, holding, selling, or trading IND Tokens regulated or illegal in certain jurisdictions.
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Compliance Risks. Complying with laws and regulations that apply to Indorse and the Platform may be costly and may divert a significant portion of Indorse’s attention and resources. If Indorse fails to comply with applicable laws or regulations, Indorse could be subject to significant legal liability and financial and reputational losses which may adversely affect the Platform.
Tax. The tax status of the Platform, the IND Tokens, and the Token Sale is unclear or unsettled in many jurisdictions. Adverse interpretation of existing tax laws and regulations or adoption of new adverse tax laws and regulations could result in unanticipated and potentially retroactive tax liability for Indorse and other stakeholders in the Platform, including you. Those adverse tax consequences could cause Indorse to modify or discontinue certain features or functions of the Platform or increase prices for the Platform, or cause Indorse to make the Platform
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unavailable in certain jurisdictions, or make using, holding, trading, buying, or selling IND Tokens subject to tax in certain jurisdictions
Market Risks
Lack of Market Penetration. The Platform may not attract users or customers for Business Services at the intended level or at a level sufficient to become or remain useful or viable. Any such lack of use or interest could negatively impact the development of the Platform and/or the utility or value of the Platform and/or the IND Tokens.
Competition. Other organisations may develop services that compete with the Platform, and may do so with some or all of the open source software underlying the Platform. Those competing services may adversely affect the adoption and use of the Platform, and ultimately the - 92 -
viability and continued existence of the Platform. It is unknown whether or to what extent, if any, those competing services may be interoperable with the Platform or may accept the IND Tokens.
Secondary Markets for IND Tokens. As at the start of the Pre-Sale Period, there is no public market for IND Tokens. Virtual currency exchanges and other secondary markets for the IND Tokens may never exist. Even if the IND Tokens are listed or traded on a secondary market, there is no assurance that an active or liquid trading market for IND Tokens will develop or, if developed, will be sustained. Unless Indorse publicly states otherwise, Indorse has no financial or other relationship with, and does not endorse, any such exchange or secondary market that elects to transact in IND Tokens. Exchanges and secondary markets may be new, undercapitalised, illiquid, volatile, operated by persons with minimal or no relevant experience, and subject to minimal or no regulatory oversight, making use of them susceptible to a variety of - 93 -
market, financial, fraud, and other risks that could result in your loss of IND Tokens or other losses.
Price Volatility. The Token Sale price of IND Tokens may not be indicative of the price of IND Tokens on public markets. The IND Tokens have no intrinsic value at the time they are created. The price of IND Tokens on public markets may be extremely volatile, may decline below the Token Sale price, or may diminish to zero in response to various factors, some of which are outside Indorse’s control, including, among others, the following:
(a)
the volatility of the prices of cryptographic tokens generally and in
response to events that have little or nothing to do with Indorse;
(b)
general economic conditions and macroeconomic changes;
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(c)
changes and innovations in blockchain technology, the industry
sectors in which Indorse operates, and other technologies and markets;
(d)
Indorse’s announcements pertaining to strategic direction, key
personnel, financial and operational results, partnerships, significant transactions, new products, and other events;
(e)
activities and announcements of Indorse’s competitors;
(f)
analysts’ reports, recommendations, and statements regarding IND
Tokens, the Platform, or Indorse.
Risk of Dilution. Indorse will create and distribute IND Tokens other than via the Token Sale, as described in paragraph 7 of Schedule 1 (Details of Token Sale). In many cases those other IND Tokens were distributed for less consideration than you paid for your IND Tokens. - 95 -
The distribution of those other IND Tokens will increase the overall supply of IND Tokens in the market and may result in downward pressure on the market price of IND Tokens. The creation and distribution of a significant number of IND Tokens other than as described in paragraph 7 of Schedule 1 (Details of Token Sale), or the perception that additional IND Tokens may be created and distributed, could adversely affect the market price of IND Tokens.
Market Perception. The market price of IND Tokens could be adversely affected by negative publicity, social media commentary, rumours, and other information, whether or not true, about Indorse, the Platform, the IND Tokens, the technology on which the Platform is based (including Ethereum), and the legal or regulatory environment in which the Platform operates.
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General Economic and Market Risks. Adverse changes in general global and regional economic and market conditions may adversely affect Indorse, the suppliers and third parties on which Indorse depends, and users and prospective users of the Platform, all of which may adversely affect the availability, reliability, performance, adoption, and ultimately the success of the Platform.
Participant Risks
Private Key Risks. You, not Indorse, are responsible for securing the private key that controls your IND Tokens. If you do not know your private key, you will permanently lose your IND Tokens. If your private key is lost or stolen, you could permanently lose your IND Tokens. If you store your private key with a third party wallet or vault service, you will permanently lose your IND Tokens if you forget and are unable to recover your credentials to access the third party service, or if the third - 97 -
party service malfunctions, is corrupted or compromised, makes your credentials or private key available to others, ceases operations, is hacked, or otherwise cannot make your private key available to you or loses control of your private key.
Sale Process Risks. The process for submitting an Order and receiving IND Tokens is described in these Terms, including Schedule 1 (Details of Token Sale), on the Pre-Sale Site, and on the Sale Site. If you do not carefully follow that process, you may not be able to participate in the Token Sale or purchase IND Tokens, you may permanently lose the funds you intend to submit as payment for your Order, or you may permanently lose the IND Tokens you have purchased.
Incompatible Wallet. The technical requirements for receiving IND Tokens are described in Clause 5.5 of these Terms. If you use a wallet or other technology that does not conform to those technical requirements, - 98 -
or if you use a third party service whose wallet or other technology does not conform to those technical requirements, your IND Tokens may be permanently lost.
Uninsured Losses. IND Tokens are not insured by Indorse or by any public agency. If your IND Tokens are lost or stolen, you will have no recourse unless you insure them at your expense. Indorse cannot issue new or substitute IND Tokens to replace lost or stolen IND Tokens.
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