Yes, Hedera anticipates raising additional funds by selling hbar coins to a small number of strategic institutional purchasers, with those coins to be delivered after a multi-year period. While the particular terms and form of the sale will be determined by Hedera based on network usage, regulatory requirements, and other considerations, the intent would be to sell the coins such that the coins would be locked up and not be able to be re-sold for a multi-year period consistent with the overall release schedule. Since the Council must approve transfers of coins from Hedera’s Treasury, the Council would have to approve any such sales before Hedera could proceed to enter the contemplated agreements.  Those sales would be included in the total number used to calculate the additional hbars to be distributed to SAFT holders who elect to participate in the Offer.

Hedera also may consider sales of coins under other structures that comport with applicable laws and regulations and that are consistent with Hedera’s plan for a slow release of hbars out of Treasury.  Although Hedera also contemplates that at some point it will begin selling coins in a measured way directly through exchanges or via other third parties in order to fund ordinary ongoing operations, Hedera does not anticipate any such sale of coins in the immediate future.  As above, any such sales would need to be approved by the Council, based on network usage, regulatory requirements, and other considerations.  Those sales also would be included in the total number used to calculate the additional hbars to be distributed to SAFT holders who elect to participate in the Offer. 

In addition, Hedera has a contract with a proprietary trading firm, to whom Hedera sells hbars that are withheld from distributions to employees under coin compensation grants.  These sales are made for the sole purpose of obtaining funds to pay tax withholding obligations that Hedera incurs from making hbar distributions under coin grants to employees. The coins sold are solely those withheld from the employee distributions; proceeds from these sales are not used to fund Hedera’s operations, but solely to pay the IRS and state and local tax authorities in respect of such employee tax obligations.  Because these sales are of employee coins, not Hedera’s Treasury coins, they are not included in the Prior Period Sales used to calculate the additional hbars to be distributed to SAFT holders who elect to participate in the Offer.