Risk Disclosures & Legal Disclaimers

IMPORTANT — READ CAREFULLY

READ THESE DISCLOSURES CAREFULLY BEFORE MAKING ANY INVESTMENT DECISION. This document contains important information about the risks associated with investing in Tex2.0 digital securities and the H2O Green Water Bond.

1. Securities Exemption Notice — Regulation D, Rule 506(c)

The securities described herein have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any state or other jurisdiction. These securities are being offered and sold in reliance on exemptions from the registration requirements of the Securities Act pursuant to Regulation D, Rule 506(c) thereunder.

No regulatory authority has passed upon or endorsed the merits of this offering or the accuracy or adequacy of any offering materials. Any representation to the contrary is a criminal offense.

The issuer will take reasonable steps to verify that all purchasers of securities in this offering are "accredited investors" as defined in Rule 501(a) of Regulation D. Verification methods may include, but are not limited to, review of tax returns, bank statements, brokerage statements, credit reports, or written confirmation from a registered broker-dealer, SEC-registered investment adviser, licensed attorney, or certified public accountant.

2. Accredited Investor Restrictions

This offering is available EXCLUSIVELY to "accredited investors" as defined under Rule 501(a) of Regulation D under the Securities Act. Accredited investors include, but are not limited to:

  • Individuals with annual income exceeding $200,000 (or $300,000 jointly with a spouse) in each of the two most recent years, with a reasonable expectation of the same in the current year.
  • Individuals with a net worth exceeding $1,000,000, excluding the value of their primary residence.
  • Holders of Series 7, Series 65, or Series 82 licenses in good standing.
  • Entities with total assets exceeding $5,000,000 that were not formed for the specific purpose of acquiring the securities offered.
  • Banks, insurance companies, registered investment companies, business development companies, or small business investment companies.
  • Trusts with total assets exceeding $5,000,000 directed by a sophisticated person.

Investors who do not meet these qualifications are not eligible to participate in this offering. Providing false or misleading information regarding accredited investor status may constitute fraud and is subject to civil and criminal penalties.

3. Digital Securities Risk Warnings

Loss of Investment: Investment in digital securities involves substantial risk of loss, including the potential loss of your entire investment. Digital assets are speculative, involve a high degree of risk, and are not suitable for all investors.

Volatility: The value of digital securities may fluctuate significantly due to market conditions, regulatory changes, technological developments, and other factors. There is no guarantee that the tokens will maintain their value or appreciate.

Liquidity Risk: There may be no active secondary market for the tokens. Investors may not be able to sell or transfer their tokens when desired, or at all. Transfer restrictions imposed by securities regulations may further limit liquidity.

Technology Risk: Digital securities rely on blockchain technology, smart contracts, and digital wallets, all of which are subject to technical failures, bugs, hacking, and other vulnerabilities. Loss of private keys will result in permanent loss of tokens.

Smart Contract Risk: The Solana SPL Token-2022 smart contracts governing the equity tokens may contain undiscovered vulnerabilities. While audits are conducted, no audit can guarantee the absence of all defects.

4. Water Infrastructure Project Risks

Regulatory Risk: Water infrastructure projects are subject to extensive federal, state, and local regulations, including environmental permits, water rights, and utility regulations. Changes in regulatory requirements could materially impact project feasibility, timelines, and costs.

Environmental Risk: Brackish water desalination and brine disposal are subject to environmental regulations. Unforeseen environmental impacts could result in project delays, additional costs, or project cancellation.

Construction Risk: Large-scale infrastructure projects are subject to construction delays, cost overruns, labor shortages, supply chain disruptions, and force majeure events including natural disasters and pandemics.

Market Risk: Revenue projections are based on assumptions about water demand, energy prices, and market conditions that may not materialize. The data center market, while growing, is subject to economic cycles and technological disruption.

Political Risk: International expansion into the Caribbean, Africa, and MENA regions involves political instability, currency risk, expropriation risk, and challenges in enforcing contractual rights across jurisdictions.

5. Token Volatility Warnings

The price of TEX2 tokens and the Tex2.0 utility coin may be extremely volatile. Factors that may affect token price include but are not limited to:

  • Overall cryptocurrency market conditions and sentiment
  • Regulatory developments affecting digital assets in the United States and internationally
  • Progress or setbacks in water infrastructure project development
  • Competition from other water infrastructure or tokenized asset projects
  • Technological developments on the Solana blockchain
  • Macroeconomic conditions including interest rates, inflation, and geopolitical events
  • Liquidity conditions on secondary markets
  • Actions by large token holders ("whales")

Past performance is not indicative of future results. Any projections or forward-looking statements contained in offering materials are based on assumptions that may prove incorrect.

6. Regulatory Uncertainty

The regulatory landscape for digital securities, tokenized bonds, and utility tokens is evolving rapidly and remains uncertain. Potential regulatory developments include:

  • The SEC may change its interpretation of securities laws as applied to digital assets
  • New legislation may impose additional requirements on tokenized securities offerings
  • State securities regulators may impose additional restrictions
  • Anti-money laundering (AML) and know-your-customer (KYC) requirements may become more stringent
  • Tax treatment of digital securities may change
  • International regulations may restrict cross-border token transfers

Such regulatory changes could materially and adversely affect the value, transferability, and utility of the tokens, and could require restructuring of the offering or the underlying business.

7. Tokenized Bond Risks (H2O Green Water Bond)

The H2O Green Water Bond issued through the Fireblocks and Bitbond platform carries additional risks:

  • Credit risk: the ability of the issuer to make interest and principal payments depends on project revenues
  • Interest rate risk: changes in prevailing interest rates may affect bond value
  • Platform risk: reliance on Fireblocks and Bitbond infrastructure for bond servicing
  • Green bond compliance: failure to meet green bond criteria could affect investor demand and pricing
  • Smart contract risk: automated distributions depend on correct smart contract execution

8. No Solicitation / Forward-Looking Statements

This website and associated materials do not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction where such offer or solicitation would be unlawful. No offer or solicitation will be made to any person in any jurisdiction where such activity is not permitted.

Certain statements contained herein constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from those projected. The company undertakes no obligation to update forward-looking statements.

9. Contact Information

For questions regarding this offering, risk disclosures, or investor verification, please contact:

dcWight Construction & SJU STAC

Compliance Department

Email: [email protected]

This offering is managed by SJU STAC (Security Token Asset Company) in partnership with dcWight Construction.