How we approach the rules

How we're structured

• Brilliant Diamond Exchange DAO LLC, a Wyoming limited liability company, runs the provenance registry and the stone markets, and stores and insures the stones. $BDE tokens are membership interests in it.
• Each offered stone has one token on Hedera. Its shares represent fractional ownership of the stone, which the DAO holds for the token holders under a custody agreement. [Counsel to confirm]
• The provenance registry is a record-keeping service, not an investment.
• Staking rewards on $BDE are a term of the $BDE security, set out in the offering documents.

Public offerings: Regulation A, Tier 2

• We're preparing a Form 1-A offering statement, with audited financial statements, for SEC qualification.
• Until it's qualified, we can gauge interest but can't accept money or sales.
• Once qualified, anyone can invest. Non-accredited individuals are limited to 10% of the greater of their annual income or net worth in each offering.

Private offerings: Rule 506(c)

• Offered only to accredited investors whose status we verify.
• A Form D notice filed within 15 days after the first sale, plus state notice filings.
• Shares are restricted securities and generally can't be resold for six months to a year.

Accredited investors include individuals with a net worth over $1 million, not counting their main home, and individuals with income over $200,000 ($300,000 with a spouse or partner) in each of the last two years who expect the same this year. Some licensed professionals and entities also qualify. See the SEC's Investor.gov guide to Rule 506.

For every investor

• We screen all investors for identity, anti-money-laundering and sanctions compliance.
• Shares trade only on a registered alternative trading system run by a registered broker-dealer, [name], between verified wallets. Our trading fee is disclosed in each offering circular.
• If a buyer acquires more than 50% of a stone's shares, the offering terms let them require the other holders to sell at the same price. Any such offer follows SEC tender offer rules where they apply.
• No regulator has approved Brilliant Diamond Exchange or judged the merits of any offering.

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