The ETHEREUM NIMCRUT for BLACK FARMERS:

Disclosure Statement, Gift Agreement and Declaration of Trust

INTRODUCTION TO DISCLOSURE STATEMENT AND GIFT AGREEMENT

The purpose of this Disclosure Statement and Gift Agreement is to provide you, the prospective donor, with information about the structure and operation of the Ethereum Net Income Makeup Charitable Remainder Unitrust for Black Farmers (the “BF ETH-NIMCRUT” or the “Unitrust”).

Additional information is found in the Unitrust’s Declaration of Trust (the “Declaration of Trust”) included herein that you acknowledge and agree to by signing the transaction that sends an eligible contribution of cryptocurrency to the BF ETH-NIMCRUT Wallet at the time you make your contribution.

The BF ETH-NIMCRUT was established under a Declaration of Trust by Daverington PLLC, the Unitrust's Trustee (“Daverington”). Your irrevocable gift to the BF ETH-NIMCRUT will be governed by the Declaration of Trust and this Disclosure Statement and Gift Agreement.

This Disclosure Statement and Gift Agreement is designed to provide you with a full and fair disclosure of the structure and operation of the Unitrust. However, you should also review the Declaration of Trust carefully.

DISCLOSURE STATEMENT AND GIFT AGREEMENT SUMMARY

This summary is intended for reference only; it is not intended to be complete and may omit information that may be considered material. The Disclosure Statement and Gift Agreement, and Declaration of Trust must be read in their entirety for a complete understanding of the BF ETH-NIMCRUT.

General benefits

Contributions to the BF ETH-NIMCRUT may produce significant benefits for the person controlling the private keys to the donating Ethereum or Ethereum Classic network address ("You"), as the donor, and the Black Farmer Fund ("BFF") designated to receive 50% of the income from Your gift for a fixed period of years ending on tenth anniversary of your donation (the "Term"). In addition, the value of the principal of the gift (the "Remainder Interest") will be distributed to the BFF at the end of the Term. The annual income from the BF ETH-NIMCRUT is 10% of the Unitrust's assets, paid quarterly subject to makeup provisions described below.

What Is NIMCRUT?

NIMCRUT is short for Net Income with Makeup Charitable Remainder Unitrust, a trust specifically defined by federal tax law that allows you to provide income to yourself or others for life, or a term of years, and to receive a tax deduction.

How A NIMCRUT Works - Generally

As the owner of a NIMCRUT (sometimes also referred to as the "donor," "grantor," "settlor" or "trustor" in trust documents), you irrevocably transfer assets to your trust, which is managed by a trustee of your choice. During the term of the trust, the trustee invests the assets and pays a fixed percentage of the value, as revalued annually, to you and/or others, such as a spouse or children. Should the trust earn less income than the pre-determined fixed percentage (a minimum of 5% is required), it will only distribute what is earned.

This feature ensures trust principal remains intact at all times.

If, in a later year, the trust earns more than the fixed percentage, it will make up its earlier shortfall to the extent its earned income exceeds its fixed percentage. When the trust ends, principal passes to charity for the purpose you designate.

Purposes of the Ethereum Net Income Makeup Charitable Remainder Unitrust for Black Farmers (the "BF ETH-NIMCRUT")

Daverington PLLC ("Daverington") is a boutique law firm that advises clients on novel investment products and markets, including Opportunity Zone programs, cryptoasset trading and regulatory compliance for peer-to-peer capital markets. Daverington has created the BF ETH-NIMCRUT to provide a convenient way for cryptocurrency investors to fulfill their charitable intentions in a tax-efficient manner while also providing the donor and the Black Farmers Fund (the "BFF") with a cryptocurrency income stream.

Charitable intent

As a charitable program, a BF ETH-NIMCRUT should not be treated as, and it is not designed to compete with, an investment made for private gain. The intention to benefit the BFF should be a major factor in any decision to make a gift to the Unitrust. If You, as the donor, lack this intention, You should not consider making a contribution.

Contributions

Contributions of [1] Ethereum ($ETH), [2] Ethereum Classic ($ETC) and [3] Ethereum ERC-20 utility tokens with a total Market Cap value of US$1,000,000,000 or more according to CoinMarketCap on the date of transfer can be made to the BF ETH-NIMCRUT at any time during the Term.

There is no minimum requested contribution to the BF ETH-NIMCRUT, however we recommend checking gas prices prior to initiating your transfer to ensure you have a surplus of ether (or classic ether, if applicable) to cover transaction fees charged by the network.

Contributions to the BF ETH-NIMCRUT are irrevocable.

Tax deductions and consequences

As the donor, You may be eligible for an income tax charitable deduction based on the size of Your gift. Starting in Q3 2021, the BF ETH-NIMCRUT will publish calculations of the present value of the Black Farmer Fund’s remainder interest for each Unitrust donor. Please visit the website of the BF ETH-NIMCRUT's Trustee, Daverington, for additional information at that time. Please be aware that there may be estate, gift, and generation-skipping transfer tax consequences of Your gift.

Availability of certain federal income tax deductions may depend on whether You itemize deductions. Rules and regulations vary at the state level. Please check with Your tax advisor. Tax deductions discussed herein refer specifically to federal taxes.

Income and makeup provisions

Your 50% portion of the 10% of Unitrust assets annually is paid out by the BF ETH-NIMCRUT quarterly in the form of in-kind property that may be fully taxable as income to You. Income will vary depending on the investment performance and yield of the Unitrust. If income is insufficient to fund a payment of 10% of BF ETH-NIMCRUT assets, amounts otherwise due will be made up and paid in future years to the extent the Unitrust's income exceeds 10% of BF ETH-NIMCRUT's assets in future years.

Lead Interest NFTs

The right a donor retains to receive income from the BF ETH-NIMCRUT is a lead interest separate from the Unitrust itself (the "Lead Interest"). This Lead Interest is a capital asset of the donor's that the Trustee will document in the form of a Non-Fungible Token ("NFT") and deposit the relevant Lead Interest NFTs into the respective donor's Ethereum or Ethereum Classic wallet address, as applicable. Future income payments from the BF ETH-NIMCRUT following the deposit of a donor wallet's corresponding Lead Interest NFTs will be made to whichever Ethereum (or Ethereum Classic) wallet address holds the relevant Lead Interest NFTs. The use of an NFT to represent and track the Unitrust donor's income rights gives You the flexibility to redirect income to a new wallet address(s) of Your choice for purposes of convenience, transaction privacy or other.

The sale of an income interest in a trust is a sale of a capital asset within the meaning of the U.S. Internal Revenue Service Code Sections 1221 and 1222. The future sale of a donor's Lead Interest will not affect a deduction taken for the remainder interest, because the Lead Interest represents that portion of the Unitrust value not given to charity. The seller of a Lead Interest in the BF ETH-NIMCRUT sells only their right to receive income for the Term. The Black Farmer Fund remains as the remainder beneficiary.

You represent and warrant to have had the opportunity to obtain the advice of independent tax, legal, and other counsel with respect to the income tax or other consequences of any sale of Your BF ETH-NIMCRUT Lead Interest NFTs.

Investments

The Trustee of the BF ETH-NIMCRUT has contracted with Acre of America Partners LP (“Acre of America”), an affiliate of the Trustee and crypto asset advisor not currently registered with the U.S. Securities and Exchange Commission (the “SEC”), to serve as the non-discretionary investment advisor to the BF ETH-NIMCRUT. Acre of America advises the Trustee regarding asset allocation of the Unitrust’s investments. Acre of America also reviews investment performance with the Trustee and, subject to final approval of the Trustee, has the discretion to recommend changes to the Unitrust’s investments.

The Trustee retains the right to retain the services of other investment advisors and blockchain consultants, and to terminate Acre of America’s service as investment advisor to the Unitrust at any time.

Service providers and fees

Under current arrangements, Acre of America and certain affiliates, consultants and service providers, provide administrative, custodial, and investment advisory services to the BF ETH-NIMCRUT. These services include, but are not limited to, computation of the present value of the Black Farmer Fund remainder interest in a gift, investment advisory services, portfolio valuation, payment of income distributions by smart contract, and the preparation of statements and annual reports which the Trustee will post on its website at Daverington PLLC.

For these services, the current arrangements require the BF ETH-NIMCRUT to pay an annualized fee of 1.0% of the value of the Unitrust’s assets. By affecting the value of the Unitrust, these fees reduce the assets available to earn income and, therefore, have the indirect effect of reducing the net income of the Unitrust paid to the beneficiaries. In addition, the assets of the BF ETH-NIMCRUT are currently invested entirely in Ethereum- and Ethereum Classic-based cryptocurrency for which there is a gas fee charged for on-chain transactions. These charges reduce the amount of the distributions of cryptocurrency income made from certain yield farming and Decentralized Finance (DeFi) investment strategies and, hence, reduce the income distributable to the beneficiaries of the BF ETH-NIMCRUT.

Reports

Confirmation of Your contributions to the BF ETH-NIMCRUT will be provided by the Ethereum Network You used for making Your contribution (ETH or ETC) and can be viewed using any one of their respective block explores. In addition, after the close of each quarter, the Trustee will post on its website at Daverington PLLC a statement showing the current value of the Unitrust attributable to Your gift identified by donating wallet addresses by network, ETH or ETC. Each income beneficiary should consult his, her or their own tax advisor with respect to the federal tax treatment and taxability of the distributions by the state in which he, she or they reside/s.

Governing documents & Gift Agreement

The administration of the BF ETH-NIMCRUT by the Trustee is governed by the terms of the Declaration of Trust. Upon the successful transfer of your eligible contribution to the BF ETH-NIMCRUT, You designate the Black Farmer Fund to receive 50% of Your income and the remainder interest.

DISCLOSURE STATEMENT

Purposes of the BF ETH-NIMCRUT

The BF ETH-NIMCRUT is designed to provide present and future support for the Black Farmer Fund and, at the same time, to provide a source of cryptocurrency income for You.

The BF ETH-NIMCRUT should not be treated as, and it is not designed to compete with, an investment made for private gain. The intention to benefit the BFF should be a major factor in any decision to make a gift to the BF ETH-NIMCRUT. If You lack this intention, You should not consider making a gift to the Unitrust. If You do have the requisite charitable intention, a gift to the BF ETH-NIMCRUT provides donors with a convenient way to fulfill this intention in a tax-efficient manner while also providing themselves with an income stream that will vary with the performance and yield of the Unitrust’s assets.

Trustees of the BF ETH-NIMCRUT

Gifts to the BF ETH-NIMCRUT will be administered by the Unitrust’s Trustee, Daverington PLLC, and Co-Trustees pursuant to the terms of the Declaration of Trust. The Trustee maintains ultimate control over the management of the BF ETH-NIMCRUT and has the right at any time to remove any or all of the BF ETH-NIMCRUT’s Co-Trustees and to appoint additional and successor Co-Trustees.

Neither You nor the BFF will have the right to participate in the selection of the Co-Trustees of the Fund.

Black Farmer Fund

The idea to create Black Farmer Fund came from two Black farmer-activists meeting at a conference in 2017 and sharing frustrations about the lack of financial assistance available for Black farmers. They decided that there needed to be a means for community members to access capital that recognized the historical discrimination of lending and banking that informs the present reality of Black communities.

The Black Farmer Fund is evolving out of a direct request from communities of black food system entrepreneurs to create an instrument that uses capital as a catalyst for social change. The community investment fund will provide access to capital to black farmers and food system entrepreneurs. BFF's Goals:

Establish a community-driven New York based patient capital investment vehicle that creates access to capital and technical support for black food system entrepreneurs.
Increase business ownership, diversity and facilitate reparations within our food system.
Develop and launch an investment vehicle that allows unaccredited investors to build wealth, and influence their food system.
Involve community members in practicing economic democracy
Operate in coordination with other organizations that are values aligned and provide complementary services and programs
Understand and move away from historically ingrained attitudes of scarcity and adopt a mindset of abundance
Advocate for greater resources and support for BIPOC ownership and decision-making within NYS’s food system

GIFTS TO THE BF ETH-NIMCRUT

Your Gift Agreement

Upon the transfer of Your Contribution, You designates the donor wallet address or future wallet address containing Your Lead Interest NFTs, as applicable, to receive 50% of the income attributable to Your gift to the BF ETH-NIMCRUT. The remaining 50% of the income attributable to Your gift will be transferred to the BFF quarterly until the end of the Term when the transfer of the remaining principal to BFF occurs.

Amount and type of contribution

There is no minimum required contribution to the BF ETH-NIMCRUT, however we recommend checking gas prices prior to initiating your transfer to ensure you have a surplus of ether to cover network transaction fees charged by the Ethereum or Ethereum Classic network.

Any tokens received that do not qualify as stated above will not be credited to the donor or be calculated as principal investable assets for the Unitrust, but may be converted and allocated to income at the discretion of the Trustee.

Contributions to the BF ETH-NIMCRUT are irrevocable. Under the terms of the Declaration of Trust and this Gift Agreement, the only right You will have in the Unitrust is the right to have your share of the net income paid to You and the BFF. Assets or other income of the Unitrust will not be available to You.

Your gift to the BF ETH-NIMCRUT will be commingled for investment purposes with other gifts to a Unitrust. Any property contributed to a BF ETH-NIMCRUT may be retained as an investment, loaned through third party platforms or smart contracts for income, staked using a validator or master node consensus mechanism (such as ETH 2.0) or may be sold for like-kind property and the proceeds in cryptocurrency, including stablecoins, reinvested. At present, the Trustee intends to maintain all Unitrust investments in crypto assets.

DONATE NOW

Please transfer Your ether ($ETH) or ETH ERC-20 utility token with a minimum total market cap of US$1,000,000,000 in any amount to 0x5158C4ef23b0d2Ac29C3899a287d41076D73Be1a or classic ether ($ETC) to 0x1e5B3b8FcCF007c842D9f07cb1561475cfFA57E1

When a gift is completed

The determination of when a donor’s gift to the BF ETH-NIMCRUT is completed for federal income tax purposes (permitting a charitable deduction) depends on a number of factors, including a donor’s effective release of dominion and control over the transferred assets. It is also necessary for a donor’s gift to be accepted by the Trustee. Both criteria should effectively be met by a confirmed transaction on the Ethereum or Ethereum Classic blockchain, so long as the transferred property is any or a combination of [1] Ethereum ($ETH), [2] Ethereum Classic ($ETC) and [3] Ethereum ERC-20 utility tokens with a total Market Cap value of US$1,000,000,000 or more according to CoinMarketCap.

INCOME FROM YOUR GIFT

Determination and payment of income

The BF ETH-NIMCRUT will distribute the net income earned with respect to Your gift and its pro-rata share of the total assets contributed to the Unitrust on a quarterly basis in equal shares to You or other holder of Your Lead Interest NFTs, as applicable, and the BFF. Net income earned during each calendar quarter will be distributed shortly after the end of that quarter, usually within a few weeks. The Trustee expects future determinations and distributions to be automated by smart contracts for faster service.

USD VALUE OF INCOME FROM YOUR GIFT

Capital gains will be considered as additions to the principal of the BF ETH-NIMCRUT and indirectly may have the effect of increasing income to the beneficiaries by increasing the amount of Unitrust assets available to earn income.

The USD value of income will depend on the performance and yield of the investments of the BF ETH-NIMCRUT, and no assurances can be given with respect to such performance or yield. In addition, the value of principal on which the income is based will fluctuate and is subject to extreme price volatility when valued in USD. BF ETH-NIMCRUT expenses will also affect the amount of income. (Please refer to “Service Providers and Fees” of this Disclosure Statement.) Consequently, the amount of net income the Unitrust will earn in any period is variable based on the performance of the underlying investments and cannot be predicted, and You cannot depend on a precise dollar amount of income or consistent percentage of yield from the BF ETH-NIMCRUT.

Income distributions will be made exclusively via the Ethereum or Ethereum Classic blockhain, as applicable, subject to the makeup provisions.

Distributions of income from the BF ETH-NIMCRUT to any income beneficiary, including future purchasers of Lead Interest NFTs, will end with the last payment of the Term.

Remainder Interest

In the unlikely event that the Black Farmer Fund goes out of existence or loses its status as a public charity under federal tax laws, one or more charitable organizations that are recognized as public charities can be selected by the Trustees to become the owner or owners of the remainder interests in the BF ETH-NIMCRUT so long as those charities support the work and prosperity of farmers in the United States of African descent with ancestral ties to historically enslaved persons.

INVESTMENT OF THE BF ETH-NIMCRUT

The Trustees may invest the assets of the BF ETH-NIMCRUT in any type of virtual property where transactions are recorded on an open distributed ledger with decentralized or other emerging forms of distributed consensus mechanisms and transparent governance, commonly referred to as crypto assets or cryptocurrencies.

Risks Specific to Crypto Assets and Cryptocurrency

A cryptocurrency is a peer-to-peer, decentralized, digital currency whose implementation relies on the principles of cryptography to validate the transactions and generation of the currency itself. A network token relies on a network protocol with similar principles to a cryptocurrency, but also serves other functions than merely storage of value. As such, the creation and usage of such crypto assets is not subject to a fully-developed set of regulatory and licensing requirements and is subject to high levels of volatility and potential for market abuse.

Crypto assets are intangible and uniquely identifiable virtual objects that exist entirely and only in electronic form. Their existence is recorded and tracked as entries in digital ledgers. The ledgers themselves are held on a distributed network of hard drives or third-party servers. When private encryption keys used to access crypto asset balances are held on internet-connected devices, such form of custody and use of private encryption keys is susceptible to many of the risks and disruptions inherent in holding any electronic data, such as power failure, security breach, communication failure and user error. As such, the means and methods by which crypto assets are controlled and “owned” can be subject to theft and loss by digital attack vectors or technology-specific factors that do not affect physical property or intangible ownership rights that can only be transferred through traditional contracting methods.

Transactions in crypto assets are recorded and authenticated not by a central repository or single trusted authority, but by a complex algorithmic consensus mechanism that requires a network of dedicated computing resources and contributions of capital and intellectual resources by a variety of unrelated market participants. Prospective investors should be aware that there is often limited to no recourse in the event a crypto asset network fails or is attacked in a manner that reduces or destroys the value of such network or related crypto asset.

Market Uncertainty

Crypto assets represent a speculative investment and involve a high degree of risk. Crypto assets are a new and rapidly evolving technological innovation. The growth of the related industry is subject to a high degree of uncertainty. The factors affecting the further development of this industry include:

(1) government and quasi-government regulation of crypto assets and their use, or restrictions on, or regulation of access to, and operation of related trading systems;

(2) continued worldwide growth in the adoption and use of crypto assets;

(3) the maintenance and development of the open-source software protocol of the crypto asset networks;

(4) changes in consumer demographics and public preferences, including negative consumer or public perception of crypto assets;

(5) technical improvements to the security, capacity, cost structure and usability for non-technical participants;

(6) the use of the networks supporting crypto assets for developing smart contracts and distributed applications; and

(7) general economic conditions and the regulatory environment relating to crypto asset trading systems and industry service providers.

Uncertain Legal Status.

The legal status of crypto assets as well as related intermediaries, trading platforms and other service providers, is evolving. It may be illegal, now or in the future, to own, hold, sell or use certain crypto assets in one or more countries, including the United States. The uncertainties regarding legal and regulatory requirements relating to crypto assets or transactions utilizing crypto assets, as well as potential accounting and tax issues or other requirements relating to crypto assets, could have a significant negative impact on the future marketability and value of the BF ETH-NIMCRUT's investments.

CFTC, SEC, FinCEN and State Regulation.

Current and future legislation, U.S. Commodity Futures Trading Commission (the “CFTC”) and U.S. Securities and Exchange Commission (the “SEC”) rulemaking and other regulatory developments may impact the manner in which the BF ETH-NIMCRUT's investments are treated for classification and settlement purposes. In particular, Crypto Assets may not be excluded from (or may be expressly included in) the definition of “security” by SEC rulemaking, or may not be excluded from such definitions if the Trustee determines to engage in certain trading strategies involving the use of leverage. Additionally, the CFTC may find certain transactions in crypto assets to be futures contracts (which include options thereon) required to be traded on a regulated exchange and cleared through a clearing house, or swaps subject to margin and reporting requirements. The Trustee cannot be certain as to how future regulatory developments will impact the treatment of the BF ETH-NIMCRUT's investments under the law.

Additionally, other regulators, such as the U.S. Financial Crimes Enforcement Network (“FinCEN”), a bureau of the U.S. Department of the Treasury tasked with combatting money laundering and illicit use of the financial system, have recently taken action in the crypto asset space. As a result, at least one crypto asset exchange (BTC-e) was fined and subsequently shut down. To the extent FinCEN takes action against other exchanges, whether or not these exchanges are utilized by the Unitrust, this may result in the crypto asset markets becoming less liquid and reduce, potentially entirely, the value of the BF ETH-NIMCRUT's. Investments held by the Unitrust on an exchange against which action is taken may also be lost temporarily or permanently. Furthermore, it is possible that regulators such as FinCEN may seek to limit or prohibit the issuance, transmission or trade of crypto assets in general, or subject such transactions to significant regulatory burdens, which would adversely affect the value of the he BF ETH-NIMCRUT's Investments.

At the state level, the New York State Department of Financial Services (the “NYDFS”) finalized a rule in 2015 that requires most businesses engaging in crypto asset activity for third parties in or involving New York, excluding merchants and consumers, to apply for a license, commonly known as a “BitLicense”, from the NYDFS and to comply with anti-money laundering, cyber security, consumer protection, and financial and reporting requirements, among others. As an alternative to the BitLicense in New York, firms can apply for a charter to become limited purpose trust companies qualified to engage in crypto asset business activity. Other states have considered regimes similar to New York’s BitLicense, and have passed statutes, regulations or guidance indicating that certain crypto asset business activities constitute money transactions requiring licensure. The inconsistency in applying money transmitting licensure requirements to certain businesses may make it more difficult for those businesses to provide services, which may affect consumer adoption of crypto assets and their price.

No FDIC or SIPC Protection.

Crypto assets held by the BF ETH-NIMCRUT are not subject to Federal Deposit Insurance Corporation (“FDIC”) or Securities Investor Protection Corporation (“SIPC”) protections. The BF ETH-NIMCRUT is not a banking institution or otherwise a member of the FDIC or SIPC and, therefore, the crypto assets held by the BF ETH-NIMCRUT are not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions. Your interest in the BF ETH-NIMCRUT’s holdings of crypto assets and represented by your Lead Interest NFTs are not insured.

Lack of Regulation of Exchanges.

Many of the exchange platforms on which crypto assets are traded, including peer-to-peer or decentralized exchanges (DEXs) are not subject to the same restrictions or governmental supervision as regulated exchanges, which may create opportunities for other traders to abuse the platforms through fraudulent or manipulative schemes. To the extent that crypto asset exchanges representing a substantial portion of the volume in crypto asset trading are involved in fraud or experience security failures or other operational issues, such failures may result in a reduction in the value of such crypto assets and could adversely affect the BF ETH-NIMCRUT and its investment performance, regardless of whether the BF ETH-NIMCRUT utilizes such exchanges.

Over the past several years, a number of crypto asset exchanges have been closed due to fraud, failure or security breaches. For example, in 2014, the largest Bitcoin exchange at the time, Mt. Gox, filed for bankruptcy in Japan amid reports the exchange lost up to 850,000 bitcoins, valued then at over $450 million. In many of these instances, the customers of such crypto asset exchanges were not immediately compensated or made whole for the partial or complete losses of their account balances in such crypto asset exchanges. While smaller crypto asset exchanges are less likely to have the infrastructure and capitalization that make larger crypto asset exchanges more stable, larger crypto asset exchanges are more likely to be appealing targets for hackers and “malware” (i.e., software used or programmed by attackers to disrupt computer operation, gather sensitive information or gain access to private computer systems).

Scalability Risks.

Some crypto assets face significant scaling obstacles that can lead to high fees or slow transaction settlement times, and attempts to increase the volume of transactions may not be effective.

There is no guarantee that any of the mechanisms in place, or technological or market solutions being implemented or explored for increasing the settlement capacity of certain crypto asset networks will be effective, or how long they will take to become effective, which could adversely affect an investment in or relating to those crypto assets.

Irrevocability of Transactions.

Crypto asset transactions are usually irrevocable, and stolen or incorrectly transferred crypto assets may be irretrievable. As a result, any incorrectly executed crypto asset transactions could adversely affect an investment of the Unitrust. Crypto asset transactions are not, from an administrative perspective, reversible without the consent and active participation of the recipient of the transaction or, in theory, control or consent of a majority of the relevant stakeholders on the respective crypto asset network. The BF ETH-NIMCRUT may not be capable of seeking compensation for any such erroneous transfer or theft. It is possible that, through computer or human error, or through theft or criminal action, the BF ETH-NIMCRUT’s crypto assets could be transferred from custody accounts in incorrect quantities or to unauthorized third parties. To the extent that the BF ETH-NIMCRUT is unable to seek a corrective transaction with such third party or is incapable of identifying the third party that has received the Unitrust’s crypto assets through error or theft, the BF ETH-NIMCRUT may be unable to revert or otherwise recover incorrectly transferred crypto assets. To the extent that the BF ETH-NIMCRUT is unable to seek redress for such error or theft, such loss could adversely affect the Unitrust's investments.

Risks of Flawed or Ineffective Source Code.

If the source code or cryptography underlying a crypto asset held by the BF ETH-NIMCRUT proves to be flawed or ineffective, malicious actors may be able to steal such crypto asset from the BF ETH-NIMCRUT. In the past, flaws in the source code of crypto assets have been exposed and exploited. Several errors and defects have been publicly found and corrected, including those that disabled some functionality for users. Discovery of flaws in, or exploitations of, the source code that allow malicious actors to take or create additional crypto assets in contravention of known network rules have occurred.

In addition, the cryptography underlying a cypto asset could prove to be flawed or ineffective, or developments in mathematics or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography becoming ineffective. In any of these circumstances, if the BF ETH-NIMCRUT holds the affected crypto asset, a malicious actor may be able to steal such asset from the Unitrust, which may adversely affect its investments. Even if the BF ETH-NIMCRUT did not hold the affected crypto asset, any reduction in confidence in the source code or cryptography underlying crypto assets generally could negatively affect the demand for any crypto asset the Unitrust may hold and therefore adversely affect its investments.

Risks of Control by Malicious Actors or Botnets.

If a malicious actor or coordinated group of actors obtains a majority of the processing power dedicated to proof-of-work (PoW) mining on a crypto asset network or controls sufficient network resources, including crypto assets with respect to non-PoW consensus mechanisms, it or they may be able to defraud participants in the network by constructing fraudulent blocks or records that prevent certain legitimate transactions from completing in a timely manner, or at all (sometimes referred to as a 51% attack). Even if the BF ETH-NIMCRUT did not hold the affected crypto asset, any reduction in confidence in the security of the consensus mechanism of governance protocols of crypto asset networks generally could negatively affect the demand for any crypto asset the BF ETH-NIMCRUT may hold and therefore adversely affect its investments.

Risk of a Blockchain “Fork”.

A temporary or permanent contentious blockchain “fork” could adversely affect the BF ETH-NIMCRUT's investments. Some crypto asset networks, including Bitcoin and Ethereum, are open source, meaning that any user can download the software, modify it and then propose that the users, miners and node operators of the crypto asset network adopt the modification. While the usual process of developing and improving crypto asset networks may be implemented technically using a fork, such forks are indistinguishable from a software upgrade and pose no threat provided that the vast majority of active network participants update their systems accordingly.

However, when significant factions within a crypto asset network community disagree with the future technical direction of the network, implementation of a competing version of such crypto asset network can be attempted by creating an alternative network that retains the history of the contested network but continues into the future on a separate trajectory with a newly created crypto asset. Such a contentious fork can introduce significant stability and security risk with respect to transacting on either or both forks of the network for a period of time.

Forks may be implemented by participants in a network after a significant security breach. For example, in June of 2016, a smart contract using the Ethereum network was hacked, which resulted in most participants in the Ethereum ecosystem electing to adopt a “hard fork” that effectively reversed the hack. However, a minority of users continued to develop the old blockchain, now referred to as “Ethereum Classic” with the digital currency on that blockchain now referred to as Classic Ether, or ETC. Classic Ether trades on several crypo asset exchanges and is supported by its own community of developers, investors, users and operators following a distinct road map for the future adoption of ETC separate from the Ethereum community.

A fork can also be introduced by an unintentional, unanticipated software flaw in the multiple versions of otherwise compatible software users run. Such a fork could adversely affect a crypto asset network’s viability, although such errors are likely to be detected and resolved by the relevant communities over time. If a permanent fork of a crypto asset network held as an investment were to occur, then the Unitrust could hold equal amounts of both the original crypto asset held at the time of the fork and the new alternative crypto asset.

It may be unclear following a hard, or permanent, fork which fork of the network represents the original asset and which is the new asset. Different metrics adopted by industry participants to determine which is the original asset include: wishes of the core developers of a crypto asset, technical support and trading pair listing by major exchanges, the blockchain with the greatest amount of hashing power contributed by miners or validators, or the blockchain with the longest chain. To the extent that the BF ETH-NIMCRUT must decide which fork is a continuation of an original asset and which is a new asset, the Unitrust's Trustee will not look to any one factor as being dispositive and instead will seek to determine which asset is generally accepted as being the continuation of the original asset by looking at a number of factors, including those listed above, the actions of market participants, discussions on relevant forums, and the relevant spot and futures prices of the assets, among other factors, all of which will be informed by the Trustee’s active participation in the crypto asset industry. Given the complications and uncertainties described above, as well as others not mentioned here, a fork in the network of a particular crypto asset could adversely affect an investment held by the Unitrust.

Inability to Realize Benefits of Hard Forks or “Air Drops”.

The BF ETH-NIMCRUT may not be able to realize the economic benefit of a hard fork or “air drop”, either immediately or ever, which could adversely affect an investment held by the Unitrust. If the BF ETH-NIMCRUT holds a crypto asset at the time of a hard fork into two crypto assets, it would be expected to hold an equivalent amount of the old and new assets following the hard fork. However, the BF ETH-NIMCRUT may not be able, or it may not be practical, to secure or realize the economic benefit of the new crypto asset for various reasons. For instance, a custodian service provider or exchange counterparty may not implement the technical changes required or otherwise may not agree to provide the BF ETH-NIMCRUT access to the new crypto asset.

In addition, the BF ETH-NIMCRUT may determine that there is no safe or practical way to custody the new Crypto Asset, or that trying to do so may pose an unacceptable risk to the Unitrust’s holdings in the old crypto asset, or that the costs of taking possession or maintaining ownership of the new crypto asset exceed the benefits of owning the new crypto asset. Additionally, there may not be a suitable market into which the BF ETH-NIMCRUT can sell the new crypto asset (either immediately after the fork or ever).

A Crypto asset held by the BF ETH-NIMCRUT may become subject to an “air drop.”

In an air drop, the promoters of a new crypto asset announce to holders of another crypto asset that they will be entitled to claim or will automatically receive a certain amount of the new crypto asset for free. For example, in March 2017, the promoters of Stellar Lumens announced that anyone that owned bitcoin as of June 26, 2017, could claim, until August 27, 2017, a certain amount of Stellar Lumens. For the same reasons as described above with respect to hard forks, the BF ETH-NIMCRUT may or may not choose, or be able, to participate in an air drop, or may or may not be able to realize the economic benefits of holding the new crypto asset. The timing of any such occurrence is uncertain and the BF ETH-NIMCRUT’s participation would be subject to the discretion of the Trustee. Any inability to recognize the economic benefit of a hard fork or an air drop could adversely affect the Unitrust's investments.

Custody of Fund Assets.

The Trustee maintains custody of the BF ETH-NIMCRUT’s crypto assets by generating and maintaining the private keys that control their movement. With respect to the BF ETH-NIMCRUT, the Trustee is responsible for taking such steps as it determines, in its sole judgment, to be required to maintain access to these keys, and prevent their exposure from hacking, malware and general security threats. However, the Trustee is not liable to the BF ETH-NIMCRUT or beneficiaries for the failure or penetration of the security system absent willful misconduct, bad faith or gross negligence (as interpreted in accordance with the laws of the State of New York) or as otherwise required by law. To the extent that the security system is penetrated, any loss of the BF ETH-NIMCRUT’s investments may adversely affect the value of the Unitrust's investments, and could result in total loss of capital.

Risk of Loss of Private Key.

Crypto assets are controllable only by the possessor of unique private keys relating to the addresses in which the crypto assets are held. The theft, loss or destruction of a private key required to access a crypto asset may be irreversible, and such private keys would not be capable of being restored by the BF ETH-NIMCRUT. Any loss of private keys relating to digital wallets used to store the BF ETH-NIMCRUT’s crypto asset could result in the loss of the crypto assets and the Unitrust could incur substantial, or even total, loss of capital.

Risk of Loss Due to Incapacitation of Key Personnel.

Kianga Daverington, as Principal of the Trustee, and appointed Co-Trustees are the sole individuals authorized to possess or consent to the third-party custody of the unique private keys required to access the crypto assets held by the BF ETH-NIMCRUT or use of multi-signature controls involving third parties. The simultaneous death or incapacitation of Kianga and the Co-Trustees may result in the loss of (or loss of access to) private keys and, consequently, the loss of crypto assets held by the BF ETH-NIMCRUT. In such an event, the Unitrust could incur substantial, or even total, loss of capital or significant delays in accessing capital while legal procedures are completed to grant access to a trustee of the estate of the Trustees.

Technology and Security.

The BF ETH-NIMCRUT must adapt to technological change in order to secure and safeguard its investments. While the Trustee believes it has developed a proprietary security system reasonably designed to safeguard the BF ETH-NIMCRUT’s investments from theft, loss, destruction or other issues relating to hackers and technological attack, such assessment is based upon known technology and threats and current industry best practices. As technological change occurs, the security threats to the BF ETH-NIMCRUT’s investments will likely adapt and previously unknown threats may emerge.

Security Breaches.

Any security breach caused by hacking, which involves efforts to gain unauthorized access to information or systems, or to cause intentional malfunctions or loss or corruption of data, software, hardware or other computer equipment, and the inadvertent transmission of computer viruses, could result in the halting of the BF ETH-NIMCRUT’s operations. While the Trustee believes its security system, the system of Acre of America and other advisors, consultants and services provider are consistent with current industry best practices, such systems are not impenetrable and may not be free from defect, and any loss due to a security breach or software defect will be borne by the Unitrust, absent willful misconduct, bad faith or gross negligence (as interpreted in accordance with the laws of the state of New York) on the part of the Trustee.

Risks of Open-Source Structure.

The open-source structure of many of the crypto asset network protocols means that certain core developers and other contributors work on a volunteer basis and may not be directly compensated for their contributions in maintaining and developing the network protocol. A collective failure to properly monitor and upgrade network protocol could damage the relevant digital networks. Consequently, developers may lack a financial incentive to maintain or develop the network, and the core developers may lack the resources to adequately address emerging issues with the networks.

There can be no guarantee that developer support will continue or be sufficient in the future. Additionally, some developers are funded by companies whose interests may be at odds with other participants in the network or with investors’ interests. To the extent that material issues arise with certain digital network protocols and the core developers and open source contributors are unable or unwilling to address the issues adequately or in a timely manner, the crypto asset networks and the BF ETH-NIMCRUT’s investments may be adversely affected.

Governance Risks.

The novelty and experimental nature of the governance process of crypto asset networks may lead to ineffective decision-making mechanisms that slow development or prevent a network from overcoming important obstacles. Governance of many crypto asset networks is by voluntary consensus and open competition. To the extent the governance mechanism of a crypto asset network is ineffective or fails, the BF ETH-NIMCRUT’s investments may be adversely affected.

With respect to crypto assets that are developed through Proof-of-Work (PoW) mining, if the value of the award of new units of crypto asset for solving blocks and amount of transaction fees for recording transactions are not sufficiently high to incentivize mining, miners may cease expending processing power to solve blocks and confirmations of transactions on that network could be slowed temporarily. A reduction in the processing power expended by miners on crypto asset networks could increase the likelihood of a malicious actor or botnet obtaining control. Any reduction in confidence in the confirmation process or processing power of a crypto asset network may adversely affect the BF ETH-NIMCRUT’s investments.

THE POOLED INCOME FUND’S TAX CONSEQUENCES

Status of the Fund

The IRS has published a form of trust instrument in Rev. Proc. 2005-53 that meets the IRS requirements for an inter vivos Charitable Remainder Trust providing for unitrust payments for a term of years. The Declaration of Trust is modeled after the instrument set forth in Rev. Proc. 2005-53 and has been reviewed by legal counsel.

Taxation of the Fund

The BF ETH-NIMCRUT is not taxed on net income distributed to beneficiaries. In addition, long-term capital gains of the Unitrust are exempt from taxation under the Internal Revenue Code. Short-term capital gains of the Unitrust, if any, are generally taxable to the Unitrust. The BF ETH-NIMCRUT will retain all capital gains and will not distribute them to the income beneficiaries.

MISCELLANEOUS

CONFLICT OF TERMS

In the event of any inconsistency between the terms of this Disclosure Statement and the attached Declaration of Trust, the terms of the Declaration of Trust will govern the rights and obligations of the Trustees of the BF ETH-NIMCRUT, the donors, and the income beneficiaries.

LIMITATION OF LIABILITY

The Trustees will not have liability under the Declaration of Trust for their actions or omissions, nor for actions or omissions of the BF ETH-NIMCRUT’s officers, employees, or agents to whom administrative or investment authority may have been delegated, except as may be caused by the Trustees’ bad faith or gross negligence in the performance of their duties. The Trustees are not liable under the Declaration of Trust for the actions or omissions of any custodian or advisor selected with reasonable care. The Trustees may use BF ETH-NIMCRUT assets to purchase insurance policies on behalf of the BF ETH-NIMCRUT and its Trustees.

AMENDMENTS

The Declaration of Trust may be amended at any time by the Trustee, but amendments will be made only when necessary to ensure that the BF ETH-NIMCRUT continues to qualify as a Charitable Remainder Unitrust; to cure ambiguities, inconsistencies, and defects; or to improve the efficient administration of the BF ETH-NIMCRUT, provided that the amendment is valid only if it is consistent with the federal income tax laws governing CRUTS and if, in the opinion of the Trustee and Co-Trustees, it does not materially adversely affect any beneficial interest in the BF ETH-NIMCRUT.

FEDERAL SECURITIES LAW

The Pooled Income Fund has not been registered under any federal or state securities laws, pursuant to an exemption for Charitable Remainder Trusts.

DO YOUR OWN RESEARCH

This Disclosure Statement does not attempt to explain how a gift to the BF ETH-NIMCRUT may fit your particular situation. For this, you should consult your own legal and investment advisors.

DECLARATION OF TRUST

On the contribution day, as recorded and confirmed on the Ethereum or Ethereum Classic blockchain at the time of my transfer of Eligible Property (as defined below) to ETH Wallet Address 0x5158C4ef23b0d2Ac29C3899a287d41076D73Be1a or ETC Wallet Address 0x1e5B3b8FcCF007c842D9f07cb1561475cfFA57E1

I, (hereinafter "the Donor"), desiring to establish a charitable remainder unitrust within the meaning of Rev. Proc. 2005-53 and § 664(d)(2) of the Internal Revenue Code (hereinafter "the Code"), hereby enter into this trust agreement with Daverington PLLC as the initial trustee (hereinafter "the Trustee"). This trust shall be known as the Ethereum Net Income Makeup Charitable Remainder Unitrust for Black Farmers or BF ETH-NIMCRUT with respect to each unique Donor ETH and ETC Wallet Address, separately and not jointly.

Charitable Remainder Unitrust.

1. Funding of Trust.

The Donor hereby transfers and irrevocably assigns, on the above referred date, to the Trustee the ether, classic ether or ERC-20 utility tokens operating on the Ethereum network with a token market cap of at least US$1,000,000,000 (“Eligible Property”) transferred during the funding transaction recorded on the Ethereum or Ethereum Classic blockchain, and the Trustee accepts the Eligible Property and agrees to hold, manage, and distribute the Eligible Property and any Eligible Property subsequently transferred, under the terms set forth in this trust instrument.

2. Payment of Unitrust Amount.

In each taxable year of the trust during the unitrust period, the Trustee shall pay 50 percent of the unitrust amount to the Donor (hereinafter "the Recipient") and 50 percent of the unitrust amount to an organization described in §§ 170(c), 2055(a), and 2522(a) of the Code (hereinafter "the Charitable Recipient") comprising a total unitrust amount equal to the lesser of (a) a fixed percentage amount equal to 10 percent of the net fair market value of the assets of the trust valued as of the valuation date (hereinafter "the fixed percentage amount described in (a) of paragraph 2") or (b) the trust income for the taxable year as defined in § 643(b) of the Code and the applicable regulations. If the Charitable Recipient is not an organization described in §§ 170(c), 2055(a), and 2522(a) of the Code at the time when any unitrust payment is to be distributed to it, then the Trustee shall distribute that unitrust payment to one or more organizations described in §§ 170(c), 2055(a), and 2522(a) of the Code as the Trustee shall select, and in the proportions as the Trustee shall decide, in the Trustee's sole discretion.

The unitrust amount for a taxable year shall also include any amount of trust income for the year that is in excess of 10 percent, but only to the extent that the aggregate of the amounts paid to the Recipient in prior years was less than the aggregate of the amounts determined for all prior years under (a) of this paragraph and (a) of paragraph 5. The valuation date is the first day of each taxable year of the trust. The unitrust period shall be a period of 10 years. The first day of the unitrust period shall be the date property is first transferred to the trust and the last day of the unitrust period shall be the day preceding the 10th anniversary of that date. The unitrust amount shall be paid in equal quarterly installments at the end of each calendar quarter from income. Any income of the trust for a taxable year in excess of the unitrust amount shall be added to principal.

If, for any year, the net fair market value of the trust assets is incorrectly determined, then within a reasonable period after the correct value is finally determined, the Trustee shall pay to the Recipient and the Charitable Recipient (in the case of an undervaluation) or receive from the Recipient and the Charitable Recipient (in the case of an overvaluation) an amount equal to the difference between the unitrust amount(s) properly payable and the unitrust amount(s) actually paid.

3. Proration of Unitrust Amount.

For a short taxable year and for the taxable year during which the unitrust period ends, the Trustee shall prorate on a daily basis the fixed percentage amount described in (a) of paragraph 2, or, if an additional contribution is made to the trust, the fixed percentage amount described in (a) of paragraph 5. In such a year, this prorated fixed percentage amount shall be used in place of the fixed percentage amount described in (a) of paragraph 2 or in (a) of paragraph 5 to determine the unitrust amount payable for that year.

4. Distribution to Charity.

At any time prior to the termination of the unitrust period, the Trustee may distribute an amount other than the unitrust amount and pay at its discretion any organization described in § 170(c). At the termination of the unitrust period, the Trustee shall distribute all of the then principal and income of the trust (other than any amount due the Recipient and the Charitable Recipient under the terms of this trust) to the Black Farmer Fund (hereinafter "the Charitable Organization"). If the Charitable Organization is not an organization described in an organization described in §§ 170(b)(1)(A), 170(c), 2055(a), and 2522(a) of the Code at the time when any principal or income of the trust is to be distributed to it, then the Trustee shall distribute the then principal and income to one or more organizations described in an organization described in §§ 170(b)(1)(A), 170(c), 2055(a), and 2522(a) of the Code as the Trustee shall select, and in the proportions as the Trustee shall decide, in the Trustee's sole discretion.

5. Additional Contributions.

Notwithstanding paragraph 2, if any additional contributions are made to the trust after the initial contribution, the unitrust amount for the year in which any additional contribution is made shall be equal to the lesser of (a) a fixed percentage amount equal to 10 percent of the sum of (1) the net fair market value of the trust assets as of the valuation date (excluding the assets so added and any post-contribution income from, and appreciation on, such assets during that year) and (2) for each additional contribution during the year, the fair market value of the assets so added as of the valuation date (including any post-contribution income from, and appreciation on, such assets through the valuation date) multiplied by a fraction the numerator of which is the number of days in the period that begins with the date of contribution and ends with the earlier of the last day of the taxable year or the last day of the unitrust period and the denominator of which is the number of days in the period that begins with the first day of such taxable year and ends with the earlier of the last day in such taxable year or the last day of the unitrust period (hereinafter "the fixed percentage amount described in (a) of paragraph 5") or (b) the trust income for the taxable year as defined in § 643(b) of the Code and the applicable regulations. The unitrust amount for that year shall also include any amount of trust income for the year that is in excess of 10 percent, but only to the extent that the aggregate of the amounts paid to the Recipient in prior years was less than the aggregate of the amounts determined for all prior years under (a) of paragraph 2 and (a) of this paragraph. In a taxable year in which an additional contribution is made on or after the valuation date, the assets so added shall be valued as of the date of contribution, without regard to any post-contribution income or appreciation, rather than as of the valuation date.

6. Deferral of the Unitrust Payment Allocable to Testamentary Transfer.

All property passing to the trust by reason of the death of the Donor (hereinafter "the testamentary transfer") shall be considered to be a single contribution that is made on the date of the Donor's death. Notwithstanding the provisions of paragraphs 2 and 5 above, the obligation to pay the unitrust amount with respect to the testamentary transfer shall commence with the date of the Donor's death. Nevertheless, payment of the unitrust amount with respect to the testamentary transfer may be deferred from the date of the Donor's death until the end of the taxable year in which the funding of the testamentary transfer is completed. Within a reasonable time after the end of the taxable year in which the testamentary transfer is completed, the Trustee must pay to the Recipient and the Charitable Recipient (in the case of an underpayment) or receive from the Recipient and the Charitable Recipient (in the case of an overpayment) the difference between any unitrust amounts allocable to the testamentary transfer that were actually paid, plus interest, and the unitrust amounts allocable to the testamentary transfer that were payable, plus interest. The interest shall be computed for any period at the rate of interest, compounded annually, that the federal income tax regulations under § 664 of the Code prescribe for this computation.

7. Trustee Services, Power to Appoint Co-Trustees & Limitation of Liability.

The Trustee shall not be entitled to any compensation in connection with the performance of its duties and powers hereunder. However, notwithstanding the foregoing, the Trustee may be reimbursed for all reasonable fees, costs and expenses of the Trustee incurred in connection the Trustee’s performance of said duties and powers. The Trustee may appoint one or more Co-Trustees to assist in the performance of its duties and powers, and may remove or replace a Co-Trustee at any time. No individual, Trustee or Co-Trustee when acting in such capacity shall be personally liable to any third party for any act, omission or obligation of any BF ETH-NIMCRUT. No trustee, officer, agent or shareholder of the Donor, Recipient, Charitable Recipient or the Charitable Organization shall be personally liable for any obligations of any BF ETH-NIMCRUT.

8. Unmarketable Assets.

Whenever the value of a trust asset must be determined, the Trustee shall determine the value of any assets that are not cash, cash equivalents, or other assets that can be readily sold or exchanged for cash or cash equivalents (hereinafter "unmarketable assets"), by either (a) obtaining a current "qualified appraisal" from a "qualified appraiser," as defined in § 1.170A-13(c)(3) and § 1.170A- 13(c)(5) of the Income Tax Regulations, respectively, or (b) ensuring the valuation of these unmarketable assets is performed exclusively by an "independent trustee," within the meaning of § 1.664-1(a)(7)(iii) of the Income Tax Regulations.

9. Prohibited Transactions.

The Trustee shall not engage in any act of self-dealing within the meaning of § 4941(d) of the Code, as modified by § 4947(a)(2)(A) of the Code, and shall not make any taxable expenditures within the meaning of § 4945(d) of the Code, as modified by § 4947(a)(2)(A) of the Code. The Trustee shall not make any investments that jeopardize the exempt purpose of the trust within the meaning of § 4944 of the Code, as modified by § 4947(a)(2)(A) of the Code, or retain any excess business holdings within the meaning of § 4943 of the Code, as modified by § 4947(a)(2)(A) of the Code.

10. Taxable Year.

The taxable year of the trust shall be the calendar year.

11. Governing Law.

The operation of the trust shall be governed by the laws of the State of New York. However, the Trustee is prohibited from exercising any power or discretion granted under said laws that would be inconsistent with the qualification of the trust as a charitable remainder unitrust under § 664(d)(2) of the Code and the corresponding regulations.

12. Investment of Trust Assets.

Nothing in this trust instrument shall be construed to restrict the Trustee from investing the trust assets in a manner that could result in the annual realization of a reasonable amount of income or gain from the sale or disposition of trust assets.

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Last updated 2 years ago