Exhibit 99.1 Confidential Private Placement Offering Memorandum

Initially Dated December 18, 2017,

as Amended, Supplemented and Restated as of March 1, 2018 THIS DOCUMENT INCLUDES IMPORTANT INFORMATION THAT REPLACES, AND IS IN ADDITION TO, THE INFORMATION PREVIOUSLY AVAILABLE TO YOU  YOU SHOULD READ THIS DOCUMENT CAREFULLY THE OFFERING PERIOD OF THE PRIVATE PLACEMENT WILL EXPIRE ON THE EARLIER TO OCCUR OF: (I) THE DATE ON WHICH THE MAXIMUM PLACEMENT AMOUNT HAS BEEN SUBSCRIBED FOR AND ACCEPTED BY THE COMPANY AND A FINAL CLOSING WITH RESPECT TO SUCH APPLICABLE SAFEs HAS BEEN CONSUMMATED OR (II) MAY 14, 2018, UNLESS EXTENDED OR EARLIER TERMINATED, IN EACH CASE, IN THE SOLE DISCRETION OF THE COMPANY (SUCH DATE, AS THE SAME MAY BE EXTENDED OR EARLIER TERMINATED, THE EXPIRATION DATE). ALL TERMS NOT DEFINED IN THIS PARAGRAPH HAVE THE MEANING GIVEN TO THEM BELOW. WITHDRAWAL RIGHTS: INVESTORS THAT HAVE EXECUTED A SAFE ON OR PRIOR TO THE DATE OF THIS OFFERING MEMORANDUM (MARCH 1, 2018) MAY RESCIND THEIR SAFE AND RECEIVE A REFUND OF THEIR INVESTMENT. SEE WITHDRAWAL RIGHTS FOR FURTHER DETAILS. t 0.COM, INC. USD $250,000,000

tZERO Preferred Equity Tokens to be acquired pursuant to Simple Agreements for Future Equity t0.com, Inc. (the Company or tZERO) previously prepared a Confidential Private Placement Offering Memorandum, initially dated December 18, 2017 (the Initial OM), which was supplemented on January 27, 2018 (the First Supplement and, together with the Initial OM, the Initial Offering Materials). This Amended, Supplemented and Restated Confidential Private Placement Offering Memorandum (as it may be amended or supplemented from time to time, this Memorandum) has been prepared by tZERO to supersede and replace the Initial Offering Materials in their entirety. To the extent there is any inconsistency between (a) any statement in the Initial Offering Materials and (b) any statement in this Memorandum, the statements in this Memorandum will prevail. You should rely only on this Memorandum and not on the Initial Offering Materials. This Memorandum has been prepared by tZERO for use by certain qualified potential purchasers to whom the Company is offering (the Offering) the opportunity to purchase the right to acquire, if issued by the Company in the future, tZERO Preferred Equity Tokens, par value USD $0.01 (the Tokens), that the Company will use its commercially reasonable efforts to develop and issue. The foregoing right to acquire Tokens, if issued by the Company in the future, will be embodied in, and documented by, a Simple Agreement for Future Equity with respect to the Tokens (as may be amended, restated and/or otherwise modified from time to time, a SAFE and, together with the Tokens, the Securities) to be entered into between the Company and qualified purchasers purchasing such Securities in the Offering. The Company expects to enter into SAFEs on an ongoing basis until on or about May 14, 2018 (as the same may be extended or earlier terminated, the Expiration Date). If the Tokens are initially issued by the Company in the future, the date of such issuance, if any, is referred to as the Token Issuance Date. The Company may issue up to $250 million of Tokens, subject to increase as described in this Memorandum. As of the date of this Memorandum, the Company has entered into executed SAFEs with approximately 1,100 purchasers for approximately $114.6 million of Tokens, of which $100.6 million has been funded by the respective purchasers. There can be no assurance that tZERO will ever issue the Tokens. If Tokens are not issued, purchasers in the Offering will not receive any refund or return of their investment. If Tokens are issued, investors may never receive any benefit from holding the Tokens. Token holders are not entitled to any utility from the Token. A legally compliant trading market for

the Tokens may never be developed and peer-to-peer transfers of Tokens will not be permitted unless and until Token holders are notified otherwise by the Company, which may require holders to hold their Tokens indefinitely. An investment in this Offering is highly speculative, and you should only invest if you are prepared to lose your entire investment. Unless the context requires otherwise, in this Memorandum the terms the Company and tZERO refer to t0.com, Inc., together with its subsidiaries, and all dollar ($) amounts set forth herein refer to United States dollars. The Company currently is a Utah corporation and expects, prior to the Token Issuance Date, to convert to a Delaware corporation. When and if such conversion does occur, the terms the Company and tZERO will refer, post conversion, to the Delaware corporation to which the Company converted. The Securities have not been, and will not be, registered under the Securities Act of 1933, as amended (the Securities Act) and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirement of the Securities Act. Accordingly, the Securities are being offered and sold only (1) to accredited investors (as defined in Rule 501 of Regulation D under the Securities Act) in compliance with Rule 506(c) of Regulation D under the Securities Act and (2) in offshore transactions to persons other than U.S. persons (as defined in Regulation S under the Securities Act) in reliance upon Regulation S under the Securities Act. None of the Securities and Exchange Commission (the SEC), any state securities commission, any foreign securities authority or any other federal, state or foreign regulatory authority has approved or disapproved of these Securities or determined if this Memorandum is truthful or complete. Any representation to the contrary is unlawful and may be a criminal offense. No action has been taken in any jurisdiction to permit a public offering of the Securities. Investing in the Securities involves a high degree of risk. You should carefully consider the risks summarized under Risk Factors of this Memorandum for a discussion of important factors you should consider before purchasing Securities. The date of this Amended, Supplemented and Restated Memorandum is March 1, 2018.

t 0 .COM, INC. SIMPLE AGREEMENT FOR FUTURE EQUITY tZERO PREFERRED EQUITY TOKENS TABLE OF CONTENTS COMPANY OVERVIEW 1 TERMS OF THE SECURITIES 13 RISK FACTORS 21 SELECTED HISTORICAL FINANCIAL STATEMENTS 40 USE OF PROCEEDS 41 DIRECTORS AND MANAGEMENT 42 PLAN OF DISTRIBUTION 44 NOTICE TO PURCHASERS 47 CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS 57 DISCLOSURE REQUIRED BY RULE 506(e) OF REGULATION D 62 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS F-1 ANNEX A  FORM OF SIMPLE AGREEMENT FOR FUTURE EQUITY ANNEX B  TERMS AND CONDITIONS OF THE TZERO PREFERRED EQUITY TOKEN ANNEX C  PAYMENT PROCEDURES ANNEX D  FORM OF NOTICE OF EXERCISE OF WITHDRAWAL RIGHTS ANNEX E  WHITE PAPER i

IMPORTANT INFORMATION FOR POTENTIAL PURCHASERS This Memorandum is directed only to qualified potential purchasers to whom it is made available or delivered by, or on behalf of, the Company, and it has been prepared solely for use by prospective purchasers of the Securities. Any reproduction or distribution of this Memorandum, in whole or in part, or the disclosure of its contents, without the prior written consent of the Company, is prohibited. By accepting this Memorandum you agree to use this Memorandum and its contents solely in connection with your evaluation of a potential investment in the Securities. Any other use of this Memorandum is prohibited. To purchase Securities, each participating qualified purchaser is required to execute their own SAFE. This Memorandum contains a summary of the material terms of the Securities. However, the summary of the Securities in this Memorandum does not purport to be complete and is subject to and qualified in its entirety by reference (i) in the case of the SAFE, to the actual text of the SAFE to be executed by each qualified purchaser, substantially in the form attached as Annex A hereto, and (ii) in the case of the Tokens, to the terms of a Certificate of Designation that will be filed with the Delaware Secretary of State as part of the Companys Certificate of Incorporation (the Certificate of Designation), the material terms and conditions of which are summarized in Annex B attached hereto (the Token Terms and Conditions). The Certificate of Designation and the Token Terms and Conditions will be posted on the Companys website and available upon request from the Company at no cost. If any of the provisions of the Securities are inconsistent with or contrary to the descriptions or terms in this Memorandum, the terms of the SAFE or the Certificate of Designation (as summarized in the Token Terms and Conditions), as applicable, will control. Furthermore, certain material rights described in the Token Terms and Conditions, such as the dividends which may be declared with respect to the Tokens, are subject to the sole discretion of tZEROs board of directors (the Board), in each case without the consent of holders of the Tokens. The Company reserves the right in its sole discretion to reject any commitment in whole or in part by not executing a SAFE. In the event that the Offering is terminated or withdrawn, all funds received in connection with the Offering will be promptly returned to the respective potential purchasers according to the payment procedures contained in Annex C attached hereto. Prior to the Expiration Date, the Company reserves the right to modify the terms of the Offering and the Securities described in this Memorandum in its sole discretion. If the Company amends the terms of the Offering in any material respect, it will provide potential purchasers that have previously funded their commitment at least 3 business days to withdraw from the Offering. Upon any such withdrawal by a purchaser, such withdrawing purchasers SAFE will terminate and all funds received in connection with the Offering from such purchaser will be promptly returned to such purchaser without interest. Such refund will be paid in the same currency and in the same amount, without interest, as paid by such Purchaser in accordance with the procedures contained in Annex C attached hereto. For example, an investor who funded 100 Bitcoin will be refunded 100 Bitcoin. The issuance of the Tokens, if any, will be exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(9) of the Securities Act or another available exemption. Upon consummation of such exchange, each applicable SAFE will immediately terminate in accordance with its terms. The Company will not be registered as an investment company under the United States Investment Company Act of 1940, as amended (the Investment Company Act). Consequently, purchasers are advised that they will not be afforded any of the protections of the Investment Company Act. See Risk FactorsThe Company is subject to the risk of possibly becoming an investment company under the Investment Company Act. The Securities described in this Memorandum are subject to legal and contractual restrictions on transferability and resale. For more information on such restrictions, please see the section titled Notice to Purchasers. ii

An investment in the Securities involves a high degree of risk, volatility and illiquidity. A prospective purchaser should thoroughly review the information contained herein and the terms of the Securities and carefully consider whether an investment in the Securities is suitable to the purchasers financial situation and goals. Purchasers should be aware that they will be required to bear the financial risks of this investment for an indefinite period of time and should be prepared to lose the full amount of their investment. No person has been authorized to make any statement concerning the Company or the sale of the Securities discussed herein other than as set forth in this Memorandum, and any such statements, if made, must not be relied upon as having been authorized by the Company. Moreover, purchasers are advised that they should rely solely on the information contained in this Memorandum in considering whether to invest in the Securities. The Company takes no responsibility for, and can provide no assurance as to the reliability of, any information that has been provided to potential purchasers outside of this Memorandum. Purchasers should make their own investigations and evaluations of the Securities, including the merits and risks involved in an investment therein. Prior to any investment, the Company will give purchasers the opportunity to ask questions of, and receive answers and additional information from, the Company concerning the provisions of this Offering, the Securities and other relevant matters, to the extent the Company possesses the same or can acquire it without unreasonable effort or expense. Purchasers should inform themselves as to the legal requirements applicable to them in respect of the acquisition, holding and disposition of the Securities, and as to the income and other tax consequences to them of such acquisition, holding and disposition. This Memorandum does not constitute an offer to sell, or a solicitation of an offer to buy, any Security in any jurisdiction in which it is unlawful to make such an offer or solicitation. Each prospective purchaser must comply with all applicable laws and regulations in force in any jurisdiction in which it receives, purchases, offers or sells the Securities and must obtain any consent, approval or permission required for the purchase, offer or sale by it of the Securities under the laws and regulations in force in any jurisdiction to which it is subject or in which it makes such purchases, offers or sales. The Company will not have any responsibility in connection with obtaining, or failing to obtain, any such consents, approvals or permissions. The Company is not making any representation to any purchaser regarding the legality of an investment in the Securities by such purchaser. By their participation in the Offering, purchasers will be deemed to have agreed that their participation will constitute their representation, warranty, acknowledgement and agreement to all of the statements about purchasers under the section titled Notice to Purchasers. Potential purchasers should carefully read that section of this Memorandum. Prospective purchasers are not to construe this Memorandum as investment, legal, tax, regulatory, financial, accounting or other advice, and this Memorandum is not intended to provide the sole basis for any evaluation of an investment in the Securities. Prior to entering into a SAFE, a prospective purchaser should consult with its own legal, investment, tax, accounting, and other advisors to determine the potential benefits, burdens, and other consequences of an investment in the Securities. Purchasers of the Securities acknowledge that Overstock.com, Inc. (Overstock), the Companys ultimate parent company, is not the issuer of the Tokens and is not guaranteeing the Tokens or the Offering. To the extent permitted by applicable law, purchasers of the Tokens waive any right to bring any action against Overstock related to any matter involving the Offering or the issuance of the Securities. Amounts referenced in the SAFE are denominated in United States dollars ($) and purchasers may tender the purchase price payable in connection with the execution of a SAFE in United States dollars, Bitcoin or Ether . Payments in Bitcoin or Ether will be valued in U.S. dollars according to the payment iii

procedures contained in Annex C attached hereto. Such currencies are subject to fluctuations in the rate of exchange and, in the case of digital assets, the exchange valuations. Such fluctuations may have an adverse effect on the number of tokens to be received, as calculated pursuant to the procedures in Annex C, as well as the value, price or income of a purchasers investment. Cautionary Statements Regarding Forward-Looking Statements This Memorandum contains forward-looking statements, including statements relating to the Companys operations, financial results, business and products. Other statements in this Memorandum, including words such as anticipate, may, believe, could, should, estimate, expect, intend, plan, predict, potential, forecasts, project, and other similar expressions, also are forward-looking statements. Forward-looking statements are made based upon managements current expectations and beliefs concerning future developments and their potential effects on the Company. Such forward-looking statements are not guarantees of future performance. The following important factors, and those important factors described elsewhere in this offering memorandum, including the matters set forth under the section entitled Risk Factors, could affect (and in some cases have affected) the Companys actual results and could cause such results to differ materially from estimates or expectations reflected in such forward-looking statements: · there can be no assurance that the Tokens will ever be issued and Tokens, if issued, will be subject to extensive legal and contractual transfer restrictions to comply with our regulatory obligations; · if Tokens are issued, the Company does not expect to pay any dividends for some time into the future and, at issuance, Token holders will not have access to any Discretionary Benefits (as defined herein) or trading market and neither may ever develop; · the tax treatment of the Securities is uncertain; · the potential application of U.S. laws regarding investment securities to the Securities is unclear; · Token transactions may be irreversible and losses due to fraudulent or accidental transactions may not be recoverable; · technological difficulties experienced by the Token Trading System (as defined herein), if developed, may prevent the access or use of a purchasers Tokens; · there is no assurance that purchasers of the Securities will receive a return on or of their investment; · the Companys management will have broad discretion over the use of the net proceeds from this Offering; · holders of the Securities generally will not have voting rights and generally will have no ability to influence the decisions of the Company; · the Securities may be subject to registration under the Exchange Act if the Company has assets above $10 million and more than 2,000 purchasers participate in the Offering; · purchasers may lack information for monitoring their investment; · the Company may be forced to cease operations; · the Securities have no history and will rank junior to the Companys debt obligations; · the Company does not expect there to be any market makers to develop a trading market in the Tokens; · only certain persons and entities are able to acquire Securities; · there is uncertainty as to what regulatory regime will apply to the Tokens; · the potential application of U.S. laws regarding virtual currencies and money transmission to the Tokens; · the Securities are not legal tender, are not backed by the government, and accounts and value balances are not subject to Federal Deposit Insurance Corporation or Securities Investor Protection Corporation protections; · the Company may not successfully develop, market and launch the Token Trading System; · the Token Trading System may not be widely adopted and may have limited users; · alternative networks may be established that compete with or are more widely used than the Token Trading System; · the Token Trading System may be the target of malicious cyberattacks or may contain exploitable flaws in its underlying code, and if the Token Trading Systems security is compromised, or if the Token Trading System is subjected to attacks that frustrate or thwart the Companys users ability to access the Token Trading System, their Tokens or the Token Trading Systems products and services, users may cut back on or stop using the Token Trading System altogether; · some market participants may oppose the development of distributed ledger or blockchain-based systems like the Token Trading System; · the regulatory regime governing blockchain technologies, cryptocurrencies, digital assets, the Existing tZERO Software Platform (as defined herein) and offerings of digital assets, such as the Securities, is uncertain; iv

· the slowing or stopping of the development or acceptance of blockchain networks and blockchain assets would have an adverse material effect on the successful development and adoption of the Securities; · the prices of blockchain assets are extremely volatile and fluctuations in the price of digital assets could materially and adversely affect the Companys business, and the Securities may also be subject to significant price volatility; · the Company has limited operating history, which makes it hard to evaluate its ability to generate revenue through operations; · the Company has, to date, relied upon discretionary funding from Overstock and if additional discretionary funding were not provided, it would have an adverse impact on the Companys operations and financial conditions; · there is no assurance that the Company will be able to continue as a going concern; · technology relied upon by the Company for its operations, including the Existing tZERO Software Platform, may not function properly; · the Companys business is subject to complex and evolving U.S. and foreign laws and regulations regarding privacy, technology, data protection, and other matters; · PRO Securities, L.L.C. and SpeedRoute, LLC are registered broker-dealers, are subject to extensive regulation, and are involved in ongoing regulatory inquiries and discussions; · risks associated with the provision of advisory services; · the popularity of cryptocurrencies and cryptosecurities offerings may decrease in the future, which could have a material impact on the Companys operations and financial conditions; · dividends paid on the Tokens may detract from capital the Company could deploy to improve its business; · the Company owes significant amounts to Overstock and has limited cash flow to fund both its ongoing operating costs and debt service, and it may need additional financing to fund its continuing operations; · the Company relies on certain major customers, making it vulnerable to changes in the business and financial condition of, or demand for its services by, such customers; · the value of the Tokens depends, in part, on the utilities the Company may provide to Token holders in the future; · a violation of privacy or data protection laws could have a material adverse effect on the Company and the value of the Token; · the Company and its subsidiaries are, and the Token Trading System, if developed, and the blockchain technology to be utilized by such Token Trading System will be, subject to cyberattacks, security risks and risks of security breaches; · the Existing tZERO Software Platform and any Token Trading System developed in the future has been and will be reliant on the continued availability of certain key employees; · the development and operation of the Existing tZERO Software Platform requires, and any Token Trading System developed in the future likely will require, technology and intellectual property rights; · the Company may face substantial competition as well as the risk that one or more competitors may obtain patents or other protections covering technology critical to the operation of the Existing tZERO Software Platform or any future Token Trading System. All forward-looking statements in this Memorandum speak only as of the date hereof. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in its expectation with regard thereto or any change in events, conditions, or circumstances on which any such statement is based. v

THIS OFFERING IS LIMITED SOLELY TO ACCREDITED INVESTORS (AS DEFINED IN REGULATION D UNDER THE SECURITIES ACT) AND IN OFFSHORE TRANSACTIONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) TO NON-U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) WHO ARE NOT PURCHASING FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON. ONLY PERSONS OF ADEQUATE FINANCIAL MEANS WHO HAVE NO NEED FOR LIQUIDITY WITH RESPECT TO THIS INVESTMENT SHOULD CONSIDER PURCHASING THE TOKENS OFFERED HEREBY PURSUANT TO A SAFE BECAUSE: (I) AN INVESTMENT IN THE SECURITIES INVOLVES A NUMBER OF SIGNIFICANT RISKS (SEE RISK FACTORS); (II) THE TOKENS MAY NEVER BE ISSUED AND (III) NO MARKET FOR THE TOKENS EXISTS, AND A MARKET FOR THE TOKENS MAY NEVER DEVELOP. COMPANY OVERVIEW Overview of t 0 .com, Inc. The Company is a financial technology company focused on the development and commercialization of financial applications of cryptographically-secured, decentralized ledgersoften referred to as distributed ledger or blockchain technologies. On December 1, 2014, Medici Inc. (Medici) was incorporated in the State of Utah, as a wholly owned subsidiary of Overstock.com (Overstock), to focus on the development of the commercial application of blockchain and financial technology. Pursuant to an agreement dated November 21, 2014, on July 16, 2015, Overstock transferred 24.9% of its shares of Medici to a third-party. On August 26, 2015, the third-party transferred 5.9% of the shares back to Overstock and redistributed some of its shares to 27 individual or entity shareholders. On October 21, 2016, Medici formally changed its name to t 0 .com, Inc. On February 3, 2017, Overstock transferred its 81.0% ownership of t0.com, Inc. to its wholly owned subsidiary, Medici Ventures, Inc (Medici Ventures). In January 2018, tZERO issued approximately 200 restricted stock units, which vested immediately, to certain employees and officers of the Company. As of the date of this Memorandum, Overstock indirectly owns 80.1% of t 0 .com, Inc. and the remaining 19.9% of t0.com, Inc. is held by 31 other individual or entity shareholders many of whom are employees or former employees of the Company. Non-Blockchain Services The Company owns two registered broker dealers, SpeedRoute, LLC (SpeedRoute) and PRO Securities, L.L.C. (PRO Securities), which the Company acquired in the first fiscal quarter of 2016 in connection with its acquisition of certain assets of Cirrus Technologies, LLC (Cirrus Technologies) during the third fiscal quarter of 2015. SpeedRoute is an electronic, agency-only Financial Industry Regulatory Authority, Inc. (FINRA)-registered broker dealer that provides connectivity for its customers to U.S. equity exchanges as well as off-exchange sources of liquidity such as dark pools. All of SpeedRoutes customers are registered broker dealers. SpeedRoute does not hold, own or sell securities. PRO Securities is a FINRA-registered broker dealer that owns and operates the PRO Securities alternative trading system (the PRO Securities ATS), which has filed a Form ATS with the Securities and Exchange Commission (SEC) notifying the SEC of its activities as an alternative trading system, or ATS. An ATS is exempted from the definition of an exchange under Section 3(a)(1) of the Securities Exchange Act of 1934, as amended (the Exchange Act), if it complies with Regulation ATS, which 1

includes, among other things, the requirement to register as a broker-dealer and file a Form ATS with the SEC to provide notice of the ATSs operations. Although Section 3(a)(1) provides the definition of an exchange, Exchange Act Rule 3b-16(a) provides a functional test to assess whether a trading system meets this definitionan entity or organization that (1) brings together the orders for securities of multiple buyers and sellers; and (2) uses established, non-discretionary methods (whether by providing a trading facility or by setting rules) under which such orders interact with each other, and the buyers and sellers entering such orders agree to the terms of the trade. A system that meets the criteria of Rule 3b-16(a), and is not excluded under Rule 3b-16(b), must register as a national securities exchange pursuant to Sections 5 and 6 of the Exchange Act or operate pursuant to an appropriate exemption. A frequently used exemption, which is relied upon by the PRO Securities ATS, is the exemption in Rule 3a1-1(a)(2) that exempts an ATS that complies with Regulation ATS. As a result, provided that it complies with the requirements of Regulation ATS, the PRO Securities ATS is not subject to the registration requirement of Section 5 of the Exchange Act. The PRO Securities ATS is a closed system available only to its broker dealer subscribers. PRO Securities does not accept orders from non-broker dealers, nor does it hold, own or sell securities. tZERO recently purchased 65.8% of the membership units of ES Capital Advisors, LLC (ES Capital), a registered investment advisor under the Investment Advisers Act of 1940, as amended. See  Recent Developments  ES Capital Investment. tZERO operates the ES Capital business under the name tZERO Advisors and offers automated investment advisory services through the Overstock.com websites FinanceHub. Blockchain Services In connection with Overstocks 2016 SEC-registered offering of Blockchain Voting Series A Preferred Stock (the Overstock Digital Securities), the Company developed a suite of software and technologies referred to as the tZERO Issuance and Trading Platform (the Existing tZERO Software Platform). The Overstock Digital Securities trade exclusively on the PRO Securities ATS, which utilizes the Existing tZERO Software Platform. While the offering of the Overstock Digital Securities served as a milestone for the issuance and trading of digital securities in a manner that utilized blockchain technology, the application of the Existing tZERO Software Platform to trading of Overstock Digital Securities is subject to limitationsfor example, (i) only U.S. investors are permitted to transact on the PRO Securities ATS and (ii) all holders of Overstock Digital Securities are required to open an account with, and access the PRO Securities ATS through, a single U.S. broker-dealer. tZERO anticipates that its first commercially available blockchain-based product will be digital locate receipt software (the DLR Software). The DLR Software is currently in customer production testing, which is being conducted by StockCross (as defined below, under Siebert Financial Transactions), and tZERO has not yet entered into any commercial licenses with any licensees. The DLR Software is intended to help broker-dealer licensees with stock inventory to both load and manage their inventory in order to assist short sellers of public securities in establishing that they have located available shares in the U.S. public securities market prior to effecting short sales. The DLR Software is intended to enable licensees to create a blockchain-based record of the shares that the licensee has made available for locates using customizable DLR Software functionality and of the daily purchases of the right to locate specifically identified shares for purposes of compliance with regulatory requirements. The Company may not successfully develop, launch, market or sell its DLR Software. See Risk FactorsThe Company may not successfully develop, launch, market or sell its digital locate receipt software. To date, tZERO has focused on developing its non-blockchain and blockchain businesses and exploring opportunities for novel applications of blockchain technology. As a result of its early stage of development, tZERO has not yet generated revenue from any commercially available blockchain-based 2

applications. Nevertheless, the Company has been at the forefront of the effort to bring greater efficiency and transparency to capital markets through the integration of blockchain technology. Recent Developments White Paper On January 27, 2018, the Company issued a White Paper (the White Paper) describing its history, business goals and certain aspects of the Tokens. The White Paper, which is available through the link provided in Annex E of this Memorandum, is incorporated by reference into, and made a part of, this Memorandum. Engagement of Placement Agents, Consultants and Other Entities In connection with the Offering, the Company has engaged several entities to facilitate the placement of the Securities and/or to provide consulting and advisory services, including: · Americas Executions, LLC (AmerX), which is a registered broker-dealer, is acting as a placement agent and performing other services for the Company in connection with the Offering and will be paid customary fees based upon the aggregate size of the Offering in connection with such engagement; · Fusion Analytics Securities, LLC (Fusion), which is a registered broker-dealer, is acting as a placement agent in the Offering on a best efforts basis and will be paid customary fees in connection with any consummated transactions pursuant to such engagement. Peter Getz, an employee of Fusion, is also the CEO of PLG Consulting, LLC (PLG Consulting), which provided advice to ES Capital in connection with tZEROs investment in ES Capital and participated in such transaction; · Chardan Capital Markets, LLC (Chardan), which is a registered broker-dealer, is acting as a placement agent in connection with the Tokens and will be paid customary fees in connection with any consummated transactions pursuant to such engagement. The Company and Chardan have amended and restated Chardans engagement letter to clarify that Chardans role is limited to acting as placement agent, as described in the immediately preceding sentence, and to eliminate any references to Special Purpose Acquisition Vehicle transactions; and · Each of Alchemist Group LLC d/b/a Alchemist (Alchemist), Liquid Digital Holdings LLC (f/k/a Hyperion Holdings VII, LLC) (Liquid Digital), Distributed Network Advisors LLC (DNA), SAFTLaunch, LLC (SAFTLaunch) and StartEngine Crowdfunding, Inc. (StartEngine) are acting as advisors and/or service providers to tZERO in connection with multiple aspects of the Offering. In addition, the Company has engaged various marketing and other service providers in connection with the Offering. These parties will receive customary fees in connection with the provision of their respective services. In connection with Alchemists services, Steven Nerayoff and Jeff Pulver are serving as members of the tZERO Advisory Board and, in connection with DNAs services, Brock Pierce is serving as a member of the tZERO Advisory Board. See Appointment of Advisory Board. · In the aggregate, tZERO expects that approximately 2.3 million Tokens (Compensatory Tokens) will be issued as compensation for advisory and other services, including as compensation to certain of the consultants and advisors identified above, to members of the tZERO Advisory Board, and as consideration for marketing, entertainment and/or other fees and expenses incurred in connection 3

with the Offering. T he Company will not generate more than 59 million Tokens in the aggregate, inclusive of tokens issued to investors pursuant to SAFEs funded by such investors with cash and/or cryptocurrency in accordance with the terms of this Memorandum (Purchased Tokens), Compensatory Tokens and additional Tokens in an amount equal to 30% of Purchased Tokens to be authorized and unissued as of the Token Issuance Date (Reserve Tokens). tZERO may appoint additional placement agents, advisors and consultants from time to time. Siebert Financial Transactions On January 31, 2018, the Company entered into a Common Stock Purchase Agreement by and among the Company, certain holders of common stock of Siebert Financial Corp. (Siebert) and StockCross Financial Services, Inc. (StockCross), an affiliate of Siebert, pursuant to which the Company received 1,476,600 shares of StockCross common stock, or 24% of the total outstanding shares, and 1,217,295 shares of Siebert common stock, or 4.5% of the total outstanding shares, for an aggregate purchase price of $12,000,000. On the same day, the Company entered into a Securities Purchase Agreement with Kennedy Cabot Acquisition (Kennedy), the majority shareholder of Siebert, pursuant to which the Company received 100 member units of Kennedy, or 1% of the total outstanding member units, and 70,000 shares of Siebert common stock, or 0.3% of the total outstanding shares, for an aggregate purchase price of $1,000,000. Siebert is a public holding company that, among other things, conducts a retail discount brokerage business through its wholly-owned subsidiary, Muriel Siebert & Co., Inc. (Muriel Siebert & Co.). On February 16, 2018, Siebert distributed an additional 90,000 shares to tZERO. Following this distribution, tZERO holds approximately 5.1 % of the total outstanding shares of Siebert common stock. In conjunction with the above agreements, the Company also signed a Financial Services Advertising Agreement by and among the Company, SpeedRoute and Muriel Siebert & Co. to offer discounted online trading of U.S. equities to customers accessing Muriel Siebert & Co. through the Overstock.com websites FinanceHub. ES Capital Investment Pursuant to a purchase agreement dated as of December 20, 2017, the Company purchased 51% of the membership units of ES Capital Advisors, LLC, (ES Capital), a registered investment advisor under the Investment Advisers Act of 1940, for an aggregate purchase price of $180,000. The Company is also obligated to satisfy certain payment obligations of ES Capital totaling $50,000, which will be paid in monthly installments through March 1, 2018. PLG Consulting provided financial advice to ES Capital in connection with tZEROs initial investment in ES Capital. Peter L. Getz, the founder and CEO of PLG Consulting, LLC, is also an employee of Fusion and has provided advisory services to tZERO in connection with the Offering. Mr. Getz will also serve as a director on the board of directors of ES Capital. On January 31, 2018, tZERO entered into a stock purchase agreement by and among the Company, David J. Morton (Morton) and PLG Consulting pursuant to which the Company purchased 2,250 membership units of ES Capital from each of PLG Consulting and Morton, who serves as the manager of ES Capital, for an aggregate purchase price of approximately $3.0 million (the Additional Purchase). Following the Additional Purchase, tZERO beneficially owns approximately 65.8% of the membership units of ES Capital. 4

In connection with the Additional Purchase, ES Capital adopted the Second Amended and Restated Operating Agreement of ES Capital (the Operating Agreement). Pursuant to the Operating Agreement, ES Capital is managed and controlled by a manager, provided that certain key actions (Fundamental Actions) require the written consent of at least a majority of the aggregate outstanding membership units of ES Capital. Fundamental Actions include amendments to certain provisions of the Operating Agreement, certain actions that would result in the liquidation or dissolution of ES Capital, the making of material changes to the nature of ES Capitals business, the conversion to a corporation and capital expenditures in excess of $250,000. The manager of ES Capital may be removed, and a new manager elected, in each case by a vote of at least a majority of the aggregate membership units of ES Capital. The initial manager of ES Capital is Morton. tZEROs membership interests in ES Capital are subject to drag-along rights in connection with certain strategic transactions approved by the manager. tZERO operates the ES Capital business under the name tZERO Advisors and offers automated investment advisory services through the Overstock.com websites FinanceHub. Verify Investor Investment Pursuant to a purchase agreement by and among the Company, Verify Investor, LLC and Jor L. Law, as representative of the several sellers of membership interests in Verify Investor, LLC, dated February 12, 2018, the Company purchased 81.0% of Verify Investor, LLC, an accredited investor verification company, for $12.0 million in cash. WPS Prime Letter of Intent On February 6, 2018, the Company entered into a Letter of Intent (the WPS LOI) with Weeden Prime Services, LLC (WPS), a U.S. registered broker-dealer. The WPS LOI contemplates that the Company will acquire 51% of the outstanding membership interests of WPS for $11.0 million in cash with a subsequent purchase, prior to the first anniversary of the initial purchase, of an additional 30% of the aggregate membership interests of WPS for an additional $7.0 million in cash. Following the subsequent purchase, the Company will own 81% of the then-outstanding membership units of WPS. The WPS LOI contemplates that the existing members of WPS shall retain certain minority investor rights, including with respect to representation on the board of managers of WPS (proportionate to ownership) and customary drag-along and tag-along rights and anti-dilution protections. The WPS LOI also contemplates that at any time following the first anniversary of the second closing, the Company may, with 60-days written notice, acquire all (but not less than all) of the outstanding membership units of WPS not then owned by the Company at fair market value. The Company expects the transaction to close during third quarter of 2018, subject to the execution of definitive documentation, any applicable regulatory approvals and customary closing conditions. Other Potential Investments The Company continues to identify, evaluate and pursue various opportunities for strategic investments or acquisitions to add to the services and expertise it offers its customers. Any such transaction that, due to its size (i.e., in excess of $10.0 million), importance to tZEROs business, operations or financial condition, or increasing impendency, is or becomes material in nature will be disclosed to investors by a press release, a further supplement to this Memorandum or by other available means of notifying purchasers in accordance with applicable law. tZEROs management exercises substantial discretion in identifying appropriate strategic transactions and negotiating the terms of such transaction. Managements determinations are based on numerous financial, strategic and operational assumptions, and there can be no assurance that such assumptions will prove to be true. Moreover, such strategic transactions may fail to produce the benefits expected at the time of tZEROs investment. 5

The transactions described under the caption Siebert Financial Transactions, ES Capital Investment, Verify Investor Investment, WPS Prime Letter of Intent and Other Potential Investments, are referred to collectively as the Equity Investments. Conversion to Delaware Corporation The Company expects to convert to a Delaware corporation prior to the Token Issuance Date, if any. Upon such a conversion, if any, the terms the Company and tZERO will refer, post conversion, to the Delaware corporation to which the Company converted. There can be no assurance that the conversion will occur, as anticipated. In the event that the conversion does not occur prior to the Token Issuance Date, all references to Delaware law in this Memorandum should be understood, instead, to refer to corresponding provisions under Utah law. Appointment of Advisory Board tZERO has announced the appointment to its Advisory Board of several key advisors: tZERO ADVISORY BOARD (1)(2) · Brock Pierce(3) · Anthony Di Iorio(4) · Peter Diamandis(5) · Lauren Selig(5) · Steven Nerayoff(6) · Gil Penchina(5) · Matt Roszak(5) · Chance Barnett(5) · Brian Kelly(5) · Matt Spoke(5) · Jeff Pulver(6) · Moe Levin(5) (1) Consideration paid to tZERO Advisory Board members will be included as Compensatory Tokens. Members of the Advisory Board will hold Tokens on the same terms and conditions, and subject to the same limitations and restrictions, as other purchasers of Tokens. In connection with the provision of the advisory services for which compensation is being provided, members of the Advisory Board may engage in promotional activities with respect to the tZERO Tokens. Members of the Advisory Board are responsible for conducting such promotional activities in accordance with all applicable securities and other laws. In addition, certain members of the tZERO Advisory Board may from time to time be involved in projects or have investments in projects that compete with tZERO and/or the tZERO Token Trading System. In the aggregate, tZERO expects that approximately 2.3 million Compensatory Tokens will be issued, including to members of the tZERO Advisory Board. (2) John Burbank, who had previously been announced as a member of the tZERO Advisory Board, subsequently withdrew his agreement to participate on the tZERO Advisory Board as a result of a potential conflict of interest with another of Mr. Burbanks business ventures. tZERO may appoint additional advisors to the Advisory Board from time to time. (3) Mr. Pierce is an officer of DNA and is serving as a member of the Advisory Board in connection with tZEROs engagement of DNA as an advisor in connection with the Offering. A portion of DNAs fees will be paid in the form of Tokens on the Token Issuance Date. (4) As consideration for participation on the tZERO Advisory Board, Mr. Di Iorio will receive 50,000 Tokens on the Token Issuance Date. Although Mr. Di Iorio has preliminarily indicated that he intends to join the tZERO Advisory Board, we have not yet entered into a binding agreement with Mr. Di Iorio for this purpose and can provide no assurance that he will be a part of the Advisory Board (5) As consideration for participation on the tZERO Advisory Board, Ms. Selig will receive 24,000 Tokens on the Token Issuance Date, and each of Messrs. Diamandis, Penchina, Roszak, Barnett, Kelly, Spoke and Levin will receive 10,000 Tokens on the Token Issuance Date. Although Messrs. Roszak, Barnett and Levin have preliminarily indicated that they intends to join the tZERO Advisory Board, we have not yet entered into a binding agreement with these individuals for this purpose and can provide no assurance that they will be a part of the Advisory Board. (6) Messrs. Nerayoff and Pulver are officers of Alchemist and are serving as members of the Advisory Board in 6

connection with tZEROs engagement of Alchemist as an advisor in connection with the Offering. A portion of Alchemists fees will be paid in the form of Tokens on the Token Issuance Date. Potential Acquisition of Tokens by Overstock tZEROs parent company, Overstock, has stated publicly that it intends to purchase up to $30.0 million of Tokens in the Offering. However, to date, Overstock has not yet executed a SAFE or otherwise committed to tZERO that it will purchase Tokens in the Offering or, if so, in what amount. If Overstock participates in the Offering, it will purchase Tokens at the $10 per Token offering price and will be entitled to the same rights pursuant to its Tokens as third party holders. There can be no assurance that Overstock will purchase Tokens in the Offering or, if so, in what amount. In addition, Overstock has also indicated that it may seek an arrangement with tZERO in which Overstock elects to receive Tokens in exchange for the cancellation of all or a portion of the Companys outstanding notes and accumulated interest owed to Overstock. For more information on the Companys outstanding obligations to Overstock, see Note 13 to the Companys unaudited consolidated financial statements contained in the Offering Memorandum. As of the date of this Memorandum, tZERO has approximately $50.0 million of outstanding indebtedness owed to Overstock. If Overstock and tZERO agree to an issuance in exchange for the cancellation of debt, the Tokens issued in such an exchange would be issued at the $10 per Token offering price, and Overstock will be entitled to the same rights pursuant to its Tokens as third party holders. In the event that Overstock participates in the Offering, whether directly, through the cancellation of indebtedness or through a combination of direct investment and cancellation of indebtedness, the Tokens received by Overstock would be included as Purchased Tokens, which would reduce the amount of Tokens available for sale to third-party investors in the Offering. ATS Joint Venture and WENN Digital Engagement On September 27, 2017, tZERO announced a joint venture (JV) with RenGen LLC (RenGen) and the Argon Group (Argon) to launch an alternative trading system for the trading of tokens issued in ICOs. Subsequent to this announcement, the parties determined to no longer pursue the development of an alternative trading system. Although the parties are no longer pursuing the development of an alternative trading system, tZERO and RenGen are in the process of re-evaluating a potential JV project, including with respect to consultancy services that the Company and RenGen may decide to provide by means of the JV project. tZERO expects that the re-envisioned JV project, if implemented, will be implemented by the Company and RenGen. On January 16, 2018, the Company announced its intent to provide advisory services to WENN Digital (WENN) in connection with its previously announced KodakCoin Security Token (the KodakCoin) offering which was initially expected to launch in the first quarter of 2018. To date, tZERO has not provided advisory services to WENN with respect to KodakCoin. tZERO expects that the advisory services contemplated in its agreement with WENN will focus on post-ICO matters. Consequently, tZERO has not contributed to, nor reviewed, the contents of the KodakCoin Offering Memorandum or White Paper. As previously announced, the Companys letter of intent with WENN contemplated KodakCoin being the first third-party security token to launch on the Companys Token Trading System, when it becomes operational. tZERO can provide no assurances regarding KodakCoin or the KodakCoin ICO. 7

The Planned Token Trading System The Company currently intends to leverage its experience and expertise from developing and maintaining the Existing tZERO Software Platform to develop a trading platform that is capable of trading the Tokens and other tokens or coins that are determined to be securities for purposes of U.S. securities laws (the Token Trading System). The Company currently does not anticipate that the Existing tZERO Software Platform will be deployed in connection with the Tokens in the same manner as it is currently deployed by the PRO Securities ATS. As of the date of this Memorandum, the Company remains in the preliminary stages of development of such a securities Token Trading System. The Token Trading System may be developed as an additional functionality of the PRO Securities ATS, as a functionality of another U.S. alternative trading system or a U.S. exchange that tZERO operates or designates, as a functionality of a non-U.S. trading system or a non-U.S. exchange that tZERO operates or designates, or any other format wherever situated. The Token Trading System may never be developed and, even if it is developed, may, for a variety of technological, legal and regulatory reasons, never become operational. See Risk FactorsRisks Related to the Development of the Token Trading System. Until the Token Trading System is available, or the Company in the future explicitly designates a digital token exchange on which holders of Tokens may transfer or resell their Tokens (such a designated exchange or the Token Trading System, referred to as a Designated Exchange), the Tokens will not be transferrable on any trading platform even if there are no legal restrictions on transfer. In addition, peer-to-peer transfers will not be permitted unless and until Token holders are notified otherwise by the Company and informed of the requirements and conditions to do so. See Notice to Purchasers. There can be no assurance that any Designated Exchange will be chosen or created or that all Token holders will have access to a Designated Exchange or that peer-to-peer transfers will ever be permitted. Initial Launch of the Securities The Company has entered into SAFEs and expects to enter into additional SAFEs on an ongoing basis until on or about the Expiration Date. The Company is targeting a Token Issuance Date on the 90th day following the Expiration Date. However, there can be no assurance that the Tokens will be issued as of such date or at all. The Token Trading System is not expected to have been developed by the Token Issuance Date and there can be no assurance that any peer-to-peer transfers will be available on the Token Issuance Date. Potential Future Competitive Landscape Initial coin offerings have, by some accounts, recently surpassed traditional early stage venture capital funding, and, as a result, have drawn a substantial amount of attention, including from U.S. regulators intensely focused on the securities law compliance of such offerings. There is a deep market need for legitimate venues to support security token offerings. While tZERO seeks to be a leader in this space and believes it is well-positioned to develop a Token Trading System, the size of the market opportunity will continue to attract potential competitors seeking to provide trading services for securities tokens. As the Company pursues the development of its proposed Token Trading System, the Company expects to face significant competition from both emerging financial technology companies and established market participants. Prior SAFE and Token Sales Prior to the Offering, the Company had not previously conducted an offering of SAFEs or Tokens. 8

Legal Proceedings From time to time, the Company may be involved in legal proceedings. The results of such legal proceedings and claims cannot be predicted with certainty, and regardless of the outcome, legal proceedings could have an adverse impact on the Companys business or the development and production of the Tokens because of defense and settlement costs, diversion of resources and other factors. SEC Matter In February 2018, the Division of Enforcement of the SEC informed the Company that it is conducting an investigation in the matter Re: Overstock.com, Inc. (NY-9777) and requested that the Company voluntarily provide certain documents related to the Offering and the Tokens in connection with its investigation. The Company is in the process of responding to this document request and will cooperate with the SEC in connection with its investigation. While the SEC is trying to determine whether there have been any violations of the federal securities laws, the investigation does not mean that the SEC has concluded that anyone has violated the law. Also, the investigation does not mean that the SEC has a negative opinion of any person, entity, or security. Broker-Dealer Matters The Companys broker-dealer subsidiaries are, and any broker-dealer subsidiaries that it acquires or forms in the future will be, subject to extensive regulatory requirements under federal and state laws and regulations and self-regulatory organization (SRO) rules. Each of SpeedRoute and PRO Securities is registered with the SEC as a broker-dealer under the Exchange Act and in the states in which it conducts securities business and is a member of FINRA. In addition, PRO Securities owns and operates the PRO Securities ATS, which has filed a Form ATS with the SEC notifying the SEC of its activities as an alternative trading system. Each of SpeedRoute and PRO Securities is subject to regulation, examination and disciplinary action by the SEC, FINRA and state securities regulators, as well as other governmental authorities with which it is registered or licensed or of which it is a member. On February 22, 2018, the SECs New York Regional Office notified PRO Securities that it is conducting an examination of PRO Securities. In the event that the Company is able to develop the Token Trading System, any failure by the broker-dealer subsidiary, if any, that operates the Token Trading System to comply with all applicable rules and regulations could have a material adverse effect on the Company and the Tokens. The Companys subsidiaries have been, and remain involved in, ongoing discussions with regulatory authorities. While certain of the discussions have been relatively informal, the Companys broker-dealer subsidiaries have also received and responded to multiple inquiries from regulators, including FINRA and the SEC. Any failure by the Companys broker-dealer subsidiaries to satisfy their regulatory authorities that they are in compliance with all applicable rules and regulations could have a material adverse effect on the Company and the Tokens. SpeedRoute continues to have discussions with FINRA about several matters, including a matter related to potential violations of FINRA rules relating to Order Audit Trail System reporting and trading practice matters and has received document requests from FINRA in connection with certain ongoing matters. SpeedRoute has received and responded to inquiries from FINRA and the SEC. In addition, in December 2017, SpeedRoute received a letter from FINRA stating that the Department of Enforcement at 9

FINRA has received a referral from the staff of FINRAs Department of Market Regulation relating to rules applicable to supervision and required supervisory procedures for review of certain potential trading activity, such as pre-arranged trades or wash trades. In an unrelated matter, each of SpeedRoute and PRO Securities have been named in a FINRA investigatory matter in which FINRA has conducted on the record interviews of two senior officers of tZERO. At this time, the Company is not aware of any proceedings against it which are expected to have a material adverse effect on its financial position, operations or ability to consummate the development and production of the Tokens. Intellectual Property Matters From time to time, the Company may be the target of patent infringement suits, typically brought by so-called non-practicing entities (commonly known as patent trolls). Although these suits must be taken seriously, and the Company intends to defend itself vigorously, suits involving non-practicing entities often involve non-material monetary settlements. At this time, the Company is not aware of any patent infringement suits against it, or contemplated to be brought against it, which could have significant effects on its financial position. Overview of Transfer Restrictions Included in this Memorandum This Memorandum describes the legal and contractual transfer restrictions applicable to the Securities. Investors should carefully review this Memorandum, including the transfer restrictions described under Notice to Purchasers and Annex B: Terms and Conditions of the tZERO Preferred Equity Token, which contain important information regarding the Securities. Investors should consult with their own legal and financial advisors regarding the transfer restrictions to which they will be bound. The below summary is intended to provide a summary overview of applicable transfer restrictions and are qualified by reference to the transfer restrictions set forth under Notice to Purchasers and Annex B: Terms and Conditions of the tZERO Preferred Equity Token. For U.S. Investors: · A SAFE is non-transferable. · Tokens are expected to be issued at or about the 90th day following closing of the offering period. · Tokens issued to U.S. persons are not transferable for one year from the Expiration Date, except that, following the establishment of a sufficient process to verify the identity of subsequent Token holders in order to ensure AML/OFAC compliance for dividend payments and compliance with applicable law (e.g., through the appointment of an SEC-registered transfer agent) and so notifies holders of Tokens thereof and of any applicable conditions, the Company may permit a Compliant Regulation S Sale. See Notice to Purchasers for additional information. · After one year from the Expiration Date, Tokens may be transferred on a designated trading system if tZERO designates or creates a designated trading platform for the Tokens. To tZEROs knowledge, no such platform currently exists to trade a security token. tZERO plans to create an authorized trading system and/or work with an existing platform to permit trading of a security token. There is no guarantee that tZERO will be successful in these endeavors. · After one year from the Expiration Date, peer-to-peer transfers will be permitted if tZERO authorizes peer-to-peer transfer and so notifies holders of Tokens thereof and of any applicable conditions. tZERO plans to authorize peer-to-peer transfers as long as a sufficient process can be 10

established to verify the identity of subsequent Token holders in order to ensure AML/OFAC compliance for dividend payments and compliance with applicable law (e.g., through the appointment of an SEC-registered transfer agent). There is no guarantee that tZERO will be able to establish such procedures and authorize peer-to-peer transfers. For non-U.S. Investors: · A SAFE is non-transferable. · Tokens are expected to be issued at or about the 90th day following closing of the offering period. · During the initial one year period from the Expiration Date, Tokens may not be offered or sold to U.S. persons, but may be transferred in Compliant Regulation S Sales if a designated trading platform exists or peer-to-peer transfers is permitted (see next two bullets). · Tokens may be transferred on a designated trading system if tZERO designates or creates a designated trading platform for the Tokens. To tZEROs knowledge, no such platform currently exists to trade a security token. tZERO plans to create an authorized trading system and/or work with an existing exchange to permit trading of a security token. There is no guarantee that tZERO will be successful in these endeavors. · Peer-to-peer transfers will be permitted if tZERO authorizes peer-to-peer transfers and so notifies holders of Tokens thereof and of any applicable conditions. tZERO plans to authorize peer-to-peer transfers as long as a sufficient process can be established to verify the identity of subsequent Token holders in order to ensure AML/OFAC compliance for dividend payments and compliance with applicable law (e.g., through the appointment of an SEC-registered transfer agent). There is no guarantee that tZERO will be able to establish such procedures and authorize peer-to-peer transfers. Withdrawal Right The Company will provide each investor who has executed a SAFE prior to the date of this Memorandum ( March 1, 2018 ) the opportunity to withdraw their entire investment within five business days of the date of this Memorandum. Investors seeking to exercise this withdrawal right must provide notice in writing (in the form attached as Annex D to this Memorandum) to tZERO: By overnight courier or certified mail to: t0.com , Inc. ATTN: Withdrawal Rights Administrator 29 Broadway, 30th Floor New York, NY 10006 Such notice of withdrawal must be received by tZERO at or prior to the close of business (5:00 p.m., New York City time) on March 8, 2018. Such notice must be provided in the form specified in Annex D hereto and must specify, and be executed in, the name of the investor exactly as it appears on such investors executed SAFE. An investor exercising withdrawal rights may only withdraw such investors entire investment. Withdrawal of a portion of an investors investment is not permitted. The Company shall not be required to give effect to (i) defective withdrawal notices not delivered in accordance with these instructions or (ii) withdrawal notices received by tZERO after 5:00 p.m., New 11

York City time on March 8, 2018. A notice of withdrawal in a form other than that set forth in Annex D may be deemed to be defective. Upon any such withdrawal, the previously executed SAFE will terminate and be void and all funds received with respect to such SAFE will be promptly returned to the respective purchaser without interest in accordance with the procedure set forth in Annex C . Refunds shall be paid in the same currency and in the same amount, without interest, as paid by such Purchaser in accordance with the procedures contained in Annex C attached hereto. For example, an investor who funded 100 Bitcoin will be refunded 100 Bitcoin. Any investor exercising withdrawal rights shall lose the benefit of any preferential pricing available to such investor in the Pre-Sale Period. If, following the exercise of withdrawal rights, any investor wishes to participate in the Offering, such participation shall be on the terms applicable at the time of such participation. 12

TERMS OF THE SECURITIES The summary below describes the principal terms of the Securities. Certain of the provisions described below are subject to important limitations and exceptions. Prospective purchasers should review the SAFE in its entirety, attached hereto as Annex A , and the Token Terms and Conditions, attached hereto as Annex B . If any of the provisions of the Securities are inconsistent with or contrary to the descriptions or terms in this Memorandum, the terms of the SAFE or the Certificate of Designation (as summarized in the Token Terms and Conditions), as applicable, will control. Upon the Tokens issuance, the provisions of the Certificate of Designation will contain the complete terms of the Tokens. Issuer t0.com, Inc. Securities A SAFE providing its holder a right to acquire certain Tokens, if issued in the future; and such Tokens, if so issued. Tokens will be issued as ERC-20 (or equivalent) compliant tokens. Offering Size USD $250,000,000 with the option to upsize to USD $300,000,000 in the event that there is sufficient market demand to do so. Purchasers Each purchaser of a SAFE (a) if in the United States, or a U.S. Person (as defined in Regulation S under the Securities Act), must be an accredited investor, as defined in Regulation D under the Securities Act or (b) if in an offshore transaction (as defined in Regulation S under the Securities Act), must not be a U.S. Person and must not be purchasing for the account or benefit of a U.S. Person. Transfer A SAFE may not be resold or transferred under any circumstances. Tokens will be Restricted Securities under Rule 144 under the Securities Act (Rule 144) and subject to legal, as well as contractual, transfer restrictions. See Notice to Purchasers for more information. In any case, Token holders will not be able to transfer their Tokens until the Company designates or creates a Designated Exchange or explicitly authorizes peer-to-peer transfers. Peer-to-peer transfers will not be permitted unless and until Token holders are notified otherwise by the Company and informed of the requirements and conditions to do so. There can be no assurance that any Designated Exchange will be designated or created or that peer-to-peer transfers will ever be permitted. Affiliates of a company, including persons who were affiliates of such company at any time during the 90 days prior to the sale of that companys securities (collectively, Affiliates) often rely on Rule 144 in order to publicly resell securities of that company. 13

The Company does not expect Rule 144 to ever be available for resales of the Tokens by Affiliates of the Company. As a result, Affiliates of the Company that acquire Tokens should expect to hold the Tokens indefinitely. Form of Payment for SAFE The purchase price of the SAFE will be designated in U.S. dollars. Payment will be accepted in U.S. dollars, Bitcoin or Ether. Payments in Bitcoin or Ether will be valued in U.S. dollars according to the payment procedures contained in Annex C attached hereto. Sale Periods During the period which commenced on December 18, 2017 and is expected to run through, and including, February 28, 2018 (the Pre-Sale Period), the Company entered into SAFEs with select strategic purchasers identified by the Company. During the period which is expected to commence on March 1, 2018 and to run through, and including, May 14, 2018 (the Subsequent Sale Period), the Company will enter into SAFEs with select purchasers identified by the Company. The Subsequent Sale Period may be extended or shortened in the Companys sole discretion. Any extension or shortening of the Subsequent Sale Period will be announced by press release, a supplement to this Memorandum or other available means of notifying purchasers. No assurance can be given that each investor that wishes to participate in the Offering will be able to do so, or to do so at the level at which such investor desires. The Company reserves the right to reject any proposed investment in part or in its entirety in its sole discretion. Consideration Outside of the Pre-Sale Period, rights to acquire Tokens will be sold pursuant to a SAFE at a price of USD $10.00 per Token to be acquired, subject to discounts which may be offered in the Companys sole discretion. During the Pre-Sale Period, purchasers entered into SAFEs providing rights to acquire Tokens at prices of $5.00 per Token, $6.67 per Token and $8.00 per Token. Although the Company exercised discretion in extending discounts for certain strategic and selected investors, the following illustrative prices were applied: · with respect to the first USD $9,999,999 raised, rights to acquire Tokens were generally sold pursuant to SAFEs at a fixed price of USD $5.00 per Token, subject to a per purchaser maximum investment of USD $250,000 but no minimum investment; 14

· after the Company raised USD $9,999,999 and with respect to additional amounts raised up to USD $49,999,999, rights to acquire Tokens were generally sold pursuant to SAFEs at a price of USD $6.67 per Token, subject to a per purchaser minimum investment of USD $50,000 but no maximum investment; and · after the Company raised $49,999,999 and with respect to additional amounts raised up to USD $99,999,999, rights to acquire Tokens were generally sold pursuant to SAFEs at a price of USD $8.00 per Token, with no minimum or maximum investment. With respect to additional amounts to be raised beyond USD $99,999,999, rights to acquire Tokens will generally be sold pursuant to SAFEs at a price of USD $10.00 per Token, subject to discounts which may be offered in the Companys sole discretion, and with a minimum investment of USD $2,000, which may be lowered in the Companys sole discretion, but no maximum investment. The Company reserves the right to grant additional discounts or extend the discounts beyond any specified parameters. As a result of these discretionary pricing features, the prices and dollar amount ranges should be viewed as illustrative only. Investors should not rely on these prices and ranges to calculate the aggregate amount of Tokens that will be issued by the Company. Nevertheless, the Company will not generate more than 59 million Tokens in the aggregate, inclusive of Purchased Tokens, Compensatory Tokens and Reserve Tokens (30% of Purchased Tokens). In addition, all of the first $9,999,999 raised at $5.00 per Token, and a substantial portion of the next $9,999,999 to $49,999,999 raised at a price of $6.67 per Token, have been sold to certain strategic investors, which include certain advisors to the Company in this Offering, and not made available to other investors. Accordingly, non-strategic investors will only be offered the ability to purchase Tokens in the $8 and $10 price ranges. Discounts may be provided to purchasers during the Subsequent Sale Period in the Companys sole discretion. Payment Instructions See Annex C for a description of payment procedures to be followed upon execution of a SAFE. The Token Issuance Although the Company will use its commercially reasonable efforts to issue the Tokens, it is not required to issue the Tokens, and SAFE purchasers will not receive any refund or return of investment in the event that the Tokens are not issued. 15

Upon consummation of the Token issuance, each applicable SAFE will immediately terminate in accordance with its terms. See the section entitled Plan of Distribution for further information on the mechanics of the Token issuance. SAFE Limitations SAFE holders are not entitled to vote, receive dividends or be deemed the holder of capital stock of the Company in their capacity as a SAFE holder for any purpose, nor will anything contained in this Memorandum be construed to confer on a SAFE holder any of the rights of stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action or to receive notice of meetings, or to receive dividends, subscription rights or otherwise. SAFEs are non-transferable. SAFE holders will have no legal or equitable rights, interests or claims in or to any specific property or assets of the Company. To the extent that a SAFE holder acquires a right to receive any payment from the Company in connection with a SAFE, such right shall be no greater than the right of an unsecured general creditor of the Company. Forward Contract Tax Treatment SAFE holders will be required to treat the SAFEs as prepaid forward contracts for U.S. federal, state and local income taxes, and will not take any position on any tax return, report, statement or tax document that is inconsistent with such treatment. Token Voting Rights Tokens will not have any voting rights except to the extent required by applicable law. Dividends under the Token If determined by the Board, noncumulative dividends may be declared and paid out of funds lawfully available therefor on the Tokens on a quarterly basis (each, a Dividend). Dividends (i) may only be declared on a Dividend Declaration Date (as defined below) and paid out of funds lawfully available therefor and (ii) with respect to the fiscal quarter to which a Dividend relates, shall only be paid if the Companys reported consolidated GAAP net income for such quarter exceeds the Dividend Amount (as defined below). The Board intends that Dividends, if any, will be declared on the last day of the second month after the end of each fiscal quarter (each a Dividend Declaration Date). If a Dividend is declared by the Board, the Company will calculate an amount equal to 10% 16

of the Companys consolidated Adjusted Gross Revenue for the most recently completed fiscal quarter (the Dividend Amount). Adjusted Gross Revenue is Revenue, net, less Cost of Sales, which is equivalent to Gross Profit, as reported in the Companys consolidated financial statements . If a Dividend is declared, the Dividend Amount shall be paid within five calendar days of the Dividend Declaration Date, pro rata to the participating Token holders. Each Dividend will be paid in U.S. dollars, Bitcoin, Ether or additional Tokens (a PIK Dividend), to the extent that the Company possesses tokens to make a PIK Dividend, with such payment method selected by the Company in its sole discretion. The Company will be permitted to pay each Dividend in one or any combination of the foregoing methods. Any Tokens to be distributed in a PIK Dividend will be issued from the Companys available Tokens or by utilizing Tokens that have been repurchased by the Company, and shall be treated for all purposes as part of the same class and series of preferred stock as previously outstanding Tokens. Dividends will be paid only on Tokens that have been rendered non-transferable by their respective holders from the first day of the fiscal quarter for which a Dividend Amount is calculated through the last day of that quarter. For example, to receive a Dividend declared on the February 28, 2025 Dividend Declaration Date, a Token holder would need to render the Tokens for which they wish to receive a Dividend non-transferable beginning on October 1, 2024 and ending on December 31, 2024. This example is illustrative only and does not suggest that Dividend will be declared for such exemplary period. Token Redemption The Company has the right to redeem the Tokens, in whole or in part, at any time. If fewer than all of the outstanding Tokens are to be redeemed at any time, the Company may choose to redeem the Tokens proportionally from all Token holders, or may choose the Tokens to be redeemed by lot or by any other equitable method. The redemption price for a Token shall be either (i) its fair market value (if any) as determined in good faith by the Board (but, in no event, less than $10.00 per Token) or (ii) if no market value is determinable at such time, USD $10.00 per Token (the Redemption Price). The Redemption Price, in the sole discretion of the Company, may be paid in U.S. dollars, Bitcoin or Ether. Payments in Bitcoin or Ether will be valued in U.S. dollars according to the payment procedures contained in Annex C attached hereto. 17

Token Liquidation Preference In the event of any liquidation, dissolution or winding up of the Company, Token holders shall be entitled to receive, prior and in preference to any distribution of any assets or funds of the Company to other holders of the Companys equity (except for any class or series of preferred stock designated to be paid prior to, or concurrently with, the Tokens as to payments in liquidation) by reason of their ownership of such Tokens, an amount per Token for each Token held by them equal to USD $0.10. If upon a Liquidation Event and after the payment or setting aside for payment to the holders of any class or series of preferred stock designated to be paid prior to the Tokens, as to a liquidation preference, the assets of the Company lawfully available for distribution to the holders of Tokens and any class or series of preferred stock designated to be paid concurrently with the Tokens, as to a liquidation preference, are insufficient to permit payment in full to all such holders, then the entire assets of the Company legally available for distribution shall be distributed with equal priority and pro rata among the Token holders and holders of any class or series of preferred stock designated to be paid concurrently with the Tokens, as to a liquidation preference, ratably and in proportion to the full amounts they would otherwise be entitled to receive. Effect of Change of Control, Merger, Consolidation and Sale of Assets on Token The merger or consolidation of the Company with any other company, including a merger in which Token holders receive cash or property for their Tokens, or the sale of all or substantially all of the assets of the Company, or any other change of control of the Company, shall not constitute a Liquidation Event and Token holders shall have no preferential rights in connection therewith except to the extent required by applicable law. Potential Future Utility Benefits to Token Holders Token holders shall not be entitled to any utility functionality as part of the Token. Nevertheless, the Company expects to endeavor to provide certain additional benefits to holders of the Tokens in the future (the Discretionary Benefits). These will not be a part of the terms and conditions of the Tokens, but rather benefits voluntarily provided by the Company to Token holders. These Discretionary Benefits may be withdrawn or changed at any time in managements discretion. These Discretionary Benefits may take many forms including, but not limited to: · discounts on certain existing products and services as well as products and services that the Company expects to offer in the future (including discounts on trading fees on any future Token Trading System); and · for Token holders purchasing 100 Tokens or more, complimentary first year membership in Overstocks 18

rewards program, Club O, where available (not currently available outside the U.S.). Access to, and the degree of, any Discretionary Benefits, if offered, is expected to be determined by the quantity of Tokens the holder possesses. All matters relating to the terms of any Discretionary Benefits will be decided solely by the Board. Furthermore, the terms of any Discretionary Benefits will be subject to amendment by the Board at any time. There can be no assurance that the Company will ever offer any Discretionary Benefits. Termination of SAFE and Tokens If the Tokens are issued, the outstanding SAFEs will terminate in accordance with their terms. Tokens, if issued, shall remain outstanding in perpetuity unless earlier repurchased or redeemed. General Withdrawal Rights Generally, if the Company amends the terms of the Offering subsequent to the date of this Memorandum in any material respect, it will provide purchasers that have previously funded their commitment at least 3 business days to withdraw from the Offering. Upon any such withdrawal, the SAFE will terminate and all funds received in connection with the Offering from such purchasers will be promptly returned to the respective purchasers without interest. Such refund will be paid in the same currency and in the same amount, without interest, as paid by such purchaser in accordance with the procedures contained in Annex C attached hereto. For example, an investor who funded 100 Bitcoin will be refunded 100 Bitcoin. Withdrawal Rights for Prior Purchases The Company will provide each investor who has executed a SAFE prior to the date of this Memorandum (March 1, 2018) the opportunity to withdraw their entire investment within five business days of the date of this Memorandum. Investors seeking to exercise this withdrawal right must provide notice in writing to tZERO by overnight courier or certified mail to: t0.com, Inc., ATTN: Withdrawal Rights Administrator, 29 Broadway, 30th Floor, New York, NY 10006. Such notice must be received by tZERO at or prior to the close of business (5:00 p.m., New York City time) on March 8, 2018. Such notice must be provided in the form specified in Annex D hereto and must specify, and be executed in, the name of the investor exactly as it appears on such investors executed SAFE. An investor exercising withdrawal rights may only withdraw such investors entire investment. Withdrawal of a portion of an investors investment is not permitted. The Company shall not be required to give effect to (i) defective withdrawal notices not delivered in accordance with these 19

instructions or (ii) withdrawal notices received by tZERO after 5:00 p.m., New York City time on March 8, 2018. Amendments The Company reserves the right to amend the terms of the Securities at any time during the Offering prior to the Expiration Date. Documentation To invest, each purchaser will be required to complete such documentation as may be requested by or on behalf of the Company, which may include, without limitation: (1) the execution and delivery of a SAFE, (2) completion of investor qualification requirements and (3) for accredited investors, provision of documents sufficient to enable the verification of such investors status. Governing Law The SAFEs will be governed by the law of the State of Delaware. The Tokens will be governed by the law of the State of Delaware. Use of Proceeds At present, the net proceeds of the Offering are expected to be used for (i) the repayment of amounts payable to Overstock, (ii) the Equity Investments; (iii) the future development of the Tokens and the Token Trading System, (iv) the development of functional utility features that tZERO may offer to holders of the Tokens, (v) general corporate purposes, which may include capital expenditures, acquisitions, debt repayments, cybersecurity upgrades, augmenting technology, infrastructure and personnel, development of products and services, and short term investments, among other things, (vi) lobbying law makers and regulatory authorities for the purpose of bringing about changes to laws and regulations related to blockchain technologies, particularly in regards to securities tokens, and (vii) offering, legal and accounting expenses. The failure by the Companys management to apply these funds effectively could have a material adverse effect on the Company and the value of the Securities. 20

RISK FACTORS An investment in the Securities involves a high degree of risk. You should consider carefully the risks described below, together with all of the other information contained in this Memorandum, the SAFE and the Token Terms and Conditions, before making an investment decision. The following risks entail circumstances under which the Companys business, financial condition, results of operations and prospects could suffer. Risks Related to an Investment in the Securities There can be no assurance that the Tokens will ever be issued and, if the Company fails to issue Tokens, investors have no right to a refund of any portion of their investment. While the Company intends to develop Tokens to be issued to holders of SAFEs, there can be no assurance that it will do so. Should the Company fail to issue the Tokens, investors will be left with only the SAFE, pursuant to which they will not be entitled to any of the rights set forth in the Token Terms and Conditions, including with respect to Dividends. SAFE holders will have no legal or equitable rights, interests or claims to any specific property or assets of the Company. The remaining SAFE would not be expected to possess economic value. Moreover, in the event of the Companys failure to issue the Tokens, investors have no right to receive a refund or any return of any portion of their investment. As a result, investors should only invest in a SAFE if they are prepared to lose their entire investment. If Tokens are issued, the Company does not expect to pay any Dividends for some time into the future and, at issuance, Token ownership will not result in access to any Discretionary Benefits. If the Company issues Tokens pursuant to the SAFEs, the terms of such Tokens will be set forth in the Certificate of Designation, as summarized in the Token Terms and Conditions set forth in Annex B . The Tokens provide that Dividends payable in-kind, in U.S. Dollars, Bitcoin or Ether, in the Companys sole discretion, will be paid only out of funds lawfully available for such payment when consolidated GAAP net income exceeds the Dividend Amount, and only if declared by the Board. The Board has no obligation to declare Dividends. Currently, the Company does not expect to be in a position to pay Dividends for some time into the future and can provide no assurances as to when Dividends might first be paid, if ever. Token holders shall not be entitled to any Discretionary Benefits as part of the Token and will not have access to any Discretionary Benefits at issuance. Nevertheless, the Company expects to endeavor to create Discretionary Benefits for holders of the Tokens in the future. These will not be a part of the terms and conditions of the Tokens, but rather benefits voluntarily provided by the Company to Token holders. These Discretionary Benefits may be withdrawn or changed at any time by the Board. There can be no assurance that the Company will ever offer any Discretionary Benefits. At issuance, there will be no trading market for the Tokens, and a trading market may never develop. If the Tokens are issued, there will be no trading market available for the Tokens, no Designated Exchange and peer-to-peer transfers will not be permitted unless and until Token holders are notified otherwise by the Company and informed of the requirements to and conditions do so. As a result of recent regulatory developments, conventional crypto exchanges are currently unwilling to list securities tokens, such as the Companys Tokens. As a result, when the Tokens become transferable, they may only be traded on very limited range of venues, including U.S. registered exchanges or regulated alternative trading systems for which a Form ATS has been properly submitted to the SEC. Currently, the Company is unaware of any operational ATS or exchange capable of supporting secondary trading in the Tokens. Moreover, even if legally permitted, by purchasing Tokens, Token holders agree to additional transfer restrictions and 21

shall not be able to effect transfers until such time as the Company informs holders that a Designated Exchange is available or that peer-to-peer transfer processes have been established. As a result, holders of Tokens should be prepared to hold their Tokens indefinitely. See Notice to Purchasers for more information. Moreover, even if the Tokens become transferable, we may rely on technology, including smart contracts, to implement certain restrictions on transferability in accordance with the federal securities laws. There can be no assurance that such technology will function properly, which could result in technological limitations on transferability and expose the Company to legal and regulatory issues. The Company currently does not anticipate that the Existing tZERO Software Platform will be deployed in connection with the Tokens in the same manner as it is currently deployed by the PRO Securities ATS, but intends to leverage its experience and expertise in developing and maintaining the Existing tZERO Software Platform in order to develop the Token Trading Systema trading platform that is capable of trading the Tokens and other tokens / coins that are determined to be securities for purposes of U.S. securities laws. As of the date of this Memorandum, the Company remains in the preliminary stages of development of such Token Trading System. The Token Trading System may be developed as an additional functionality of the PRO Securities ATS, as a functionality of another U.S. alternative trading system or U.S. exchange that tZERO operates or designates, as a functionality of a non-U.S. trading system or non-U.S. exchange, or any other format wherever situated. The development of the Token Trading System implicates complex technological considerations and raises numerous legal and regulatory issues that will need to be addressedlikely, in consultation with the Companys broker-dealer subsidiaries regulators. As a result of these technological, legal and regulatory considerations, the Token Trading System may never be developed and, if developed, may, for a variety of technological, legal and regulatory reasons, never become operational. Furthermore, there can be no assurance that any security token exchange will be created by a third party that will allow the Tokens to trade in a manner permitted by the Company or at all. In the event that the Tokens remain untradeable for a significant period of time or indefinitely, the value of the Tokens would be materially adversely affected. Regulatory authorities may never permit the Token Trading System to become operational. Assuming that tZERO is able to develop a Token Trading System, numerous regulatory authorities, including FINRA and the SEC, would need to permit the Token Trading System to become operational. If FINRA, the SEC or any other regulatory authority objected to the Token Trading System or to aspects of the Token Trading System, such regulatory authorities could prevent the Token Trading System from ever becoming operational. The regulatory landscape that we expect to navigate in order to achieve an operational Token Trading System is complex, and tZERO may never be able to do so successfully. Any such regulatory issues would have a material adverse impact on our business. Due to the unavailability of Rule 144 for resales of Tokens by affiliates of the Company, Company affiliates may elect not to acquire the Tokens. Assuming that a Designated Exchange ever becomes available for trading of the Tokens, the Company does not expect Rule 144 ever to be available for any resales of Tokens by affiliates of the Company. As a result, affiliates of the Company may be unable to resell the Tokens unless the Company registers their sales. To make it easier for affiliates of the Company to publicly resell Tokens, the Company may in the future consider registering such resales; however, such registration statement may not become or remain effective and the Company has no obligation to register such Tokens. Furthermore, a seller under a registration statement may have liabilities that a seller under Rule 144 does not have. Any or all of these matters may cause affiliates of the Company to elect not to acquire the Tokens, which could depress the value of Tokens. 22

The tax treatment of the Securities is uncertain and there may be adverse tax consequences for purchasers upon certain future events. The tax characterization of the Securities is uncertain, and each purchaser must seek its own tax advice in connection with an investment in the Securities. An investment in the Securities may result in adverse tax consequences to purchasers, including withholding taxes, income taxes and tax reporting requirements. See Certain United States Federal Income Tax Considerations, herein. Each purchaser should consult with and must rely upon the advice of its own professional tax advisors with respect to the United States and non-U.S. tax treatment of an investment in the Securities. The tax characterization of the Securities also affects the Companys tax liability in connection with the Offering. In addition, the accounting consequences are uncertain, and there is a possibility that the proceeds of the Offering might be treated as a liability rather than equity for accounting purposes, which would reduce tZEROs net book value compared to equity treatment, which would prevent tZERO from making dividend payments until such time, if ever, that tZEROs net book value increases to a positive amount at least greater than the aggregate amount of any proposed dividend. The potential application of U.S. laws regarding investment securities to the Securities is unclear. The Securities are novel and the application of U.S. federal and state securities laws is unclear in many respects. Because of the differences between the Securities and traditional investment securities, there is a risk that issues that might easily be resolved by existing law if traditional securities were involved may not be easily resolved for the Securities. In addition, because of the novel risks posed by the Securities, it is possible that securities regulators may interpret laws in a manner that adversely affects the value of the Securities. For example, if applicable securities laws restrict the ability for the Tokens to be transferred, this would have a material adverse effect on the value of the Securities. The occurrence of any such legal or regulatory issues or disputes, or uncertainty about the legal and regulatory framework applicable to the Securities, could have a material adverse effect on the holders of Securities. If the Tokens ever become transferable, Token transactions may be irreversible, and, accordingly, losses due to fraudulent or accidental transactions may not be recoverable. In the event that the Token Trading System is developed and becomes operational, or the Tokens become tradeable on another Designated Exchange or pursuant to permitted peer-to-peer transfers, transactions in the Tokens may be irreversible, and, accordingly, a purchaser of the Tokens may lose all of his or her investment in a variety of circumstances, including in connection with fraudulent or accidental transactions, technology failures or cyber-security breaches. If applicable, real-time settlement would further increase the risk that correction of trading errors may be impossible and losses due to fraudulent or accidental transactions may not be recoverable. The nature of the Tokens means that any technological difficulties experienced by the Token Trading System, if developed, or any other Designated Exchange may prevent the access or use of a purchasers Tokens. Any Designated Exchange, including the Token Trading System, if developed, will be subject to the risk of technological difficulties that may impact trading of the Tokens, which include, without limitation, failures of any blockchain on which the Tokens or the Designated Exchange relies or the the failure of smart contracts to function properly. Trading in the Tokens will depend on the operation and functionality of the applicable Designated Exchange and if such system were to fail for any reason, trading in the Tokens could be impossible until such failure was corrected and full functionality were restored and tested. Any such technological difficulties may prevent the access or use of the Tokens. This could have 23

a material impact on the applicable Designated Exchanges ability to execute or settle trades of the Tokens, to maintain accurate records of the ownership of the Tokens and to comply with obligations relating to records of the ownership of the Tokens and could have a material adverse effect on the holders of the Tokens. There is no assurance that purchasers of the Securities will receive a return on their investment. The Securities are highly speculative and any return on an investment in the Securities is contingent upon numerous circumstances, many of which (including legal and regulatory conditions) are beyond the Companys control. There is no assurance that purchasers will realize any return on their investments or that their entire investments will not be lost. For this reason, each purchaser should carefully read this Memorandum and should consult with their own attorney, financial and tax advisors prior to making any investment decision with respect to the Securities. Investors should only make an investment in the Securities if they are prepared to lose the entirety of such investment. The Companys management will have broad discretion over the use of the net proceeds from this Offering. At present, the net proceeds of the Offering are expected to be used for (i) the repayment of amounts payable to Overstock, (ii) the Equity Investments; (iii) the future development of the Tokens and the Token Trading System, (iv) the development of functional utility features that tZERO may offer to holders of the Tokens, (v) general corporate purposes, which may include capital expenditures, acquisitions, debt repayments, cybersecurity upgrades, augmenting technology, infrastructure and personnel, development of products and services, and short term investments, among other things, and (vi) lobbying law makers and regulatory authorities for the purpose of bringing about changes to laws and regulations related to blockchain technologies, particularly in regards to securities tokens, and (vii) offering, legal and accounting expenses. The failure by the Companys management to apply these funds effectively could have a material adverse effect on the Company and the value of the Securities. Since the commencement of the Offering through the date of this Memorandum, the Company has utilized approximately $28.2 million, excluding amounts that may become due in connection with the transaction contemplated by the WPS LOI or any transactions described under Recent DevelopmentsOther Potential Investments, toward the purchase price of the Equity Investments. Holders of the Securities will generally not have voting rights and will generally have no ability to influence the decisio