Welcome to the Golden Rule Syndicate Club

Do unto others as you would have them do unto you.

In the Golden Rule Syndicate, Ranks reflect your ongoing journey. As you earn Koo points through participation, you’ll rise from Hatchling to Golden Wing, each stage symbolizing your growing impact in the community. Ranks show your progress, your commitment, and the trust you’ve built within the Syndicate.

Fledgling Members

Fledgling Member

Testing your wings 🐦

Golden Wings

Golden Wing Member

The highest honor 🏆

Guardian Members

Guardian Member

Protector of the flock 🛡️

Hatchlings

Hatchling Member

Just hatched into the Syndicate 🥚

Soaring Members

Soaring Member

Rising above with strength ✨

• Polls for collective decisions (Forminator or WPForms).

• Results display (transparency).

Achievements are special milestones that recognize your unique contributions. From supporting events and promoting Koo Koo Liqueur® to providing creative ideas or operational support, achievements highlight the different ways members bring value. Unlocking these badges not only rewards your effort but also adds to your legacy in the Syndicate.

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Event Supporter

5 Points

Supporting Syndicate events 🎉

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• Check-in at an event 1 time

Promoter

5 Points

Spreading the word 📢

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• Submit Participation Log form setting field "Activity Type" to "Promotion" value 1 time

Creative Contributor

10 Points

Sharing your creativity 🎨

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1. Submit Participation Log form setting field "Activity Type" to "Creative" value 1 time

Operations Supporter

5 Points

Keeping things running ⚙️

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• Submit Participation Log form setting field "Activity Type" to "Logistics" value 1 time

Loyal Participant

20 Points

Consistently showing up 🕒

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• Successful submit a specific form 5 times (limited to 1 per year)

Board Recognition

100 Koo Koos

Special recognition 🌟

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• Update any post field with any value 1 time

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International Participant Addendum

Golden Rule Syndicate Club – Profit Participation Agreement
Koo Koo Liqueur, Inc.

This International Participant Addendum (“Addendum”) supplements the Profit Participation Agreement and applies to all Members who reside outside the United States or who are classified as non-U.S. persons for federal tax purposes.

The purpose of this Addendum is to clarify obligations, withholding procedures, regulatory limitations, and certifications required for international participation.

Purpose of This Addendum

This Addendum provides a comprehensive framework governing the participation of individuals or entities located outside the United States. It sets forth:

• Tax documentation requirements

• Withholding obligations

• Jurisdictional limitations

• Disclaimers regarding solicitation

• Compliance responsibilities under foreign law

• Certification duties for non-U.S. participants

Membership in the Golden Rule Syndicate Club is limited, private, and contractual.
No public offering or cross-border solicitation is made.

Definitions

Non-U.S. Person

Any individual or entity that is not classified as a U.S. person under federal tax law, including:

• Nonresident aliens

• Foreign corporations

• Foreign partnerships

• Foreign trusts

• Foreign estates

U.S.-Source Income

Any income considered effectively connected with U.S. activities under federal tax law and subject to withholding.

Tax Documentation Requirements

A. Completion of IRS Form W-8

All international Members must provide a valid and accurate:

• Form W-8BEN (individuals), or

• Form W-8BEN-E (entities)

No distributions may be made until proper documentation is received.

B. Renewal Obligations

Tax forms must be updated prior to expiration. Failure to provide updated documentation may result in withholding at the maximum statutory rate.

C. Certification of Accuracy

The Member affirms that all information provided is complete and accurate. Any change in residency, tax classification, or legal status must be reported promptly.

Withholding Requirements

A. Mandatory U.S. Withholding

Distributions may be subject to withholding at statutory rates applicable to non-U.S. persons. The Company will comply with:

• IRS withholding rules

• Reporting obligations (including Forms 1042 and 1042-S)

• Required deposit schedules and annual filings

B. No Guarantee of Reduced Rates

Any treaty-based reduction in withholding requires:

• Proper documentation

• Proof of treaty eligibility

• Accurate certification through IRS forms

C. Company’s Administrative Role

The Company may withhold, deposit, and report taxes as required.
Withheld amounts are not refundable by the Company and must be addressed directly with the appropriate tax authority.

Foreign Law Compliance

A. Member’s Obligations

The Member is solely responsible for compliance with:

• Foreign tax laws

• Foreign reporting obligations

• Financial account regulations (including CRS and FATCA-equivalent laws)

• All general legal requirements in their home jurisdiction

B. Company Disclaimers

The Company does not:

• Provide foreign legal or tax advice

• Represent that the Agreement complies with foreign law

• Undertake to determine the Member’s foreign legal obligations

Non-Solicitation Acknowledgment

A. No Foreign Offering

The Member acknowledges that:

• No solicitation was made outside the United States

• Participation results from direct, private, voluntary contact initiated by the Member

B. No Public Advertising

The Company does not market or advertise the program internationally.

C. Jurisdictional Limitations

Participation may not be lawful in all jurisdictions. The Member affirms that participation does not violate the laws of their country.

Distributions to International Members

A. Payment Logistics

Payments may be made in U.S. dollars through approved payment channels.

B. Banking Requirements

The Member must provide:

• Valid banking or payment account information

• Compliance with international banking regulations

• Confirmation of eligibility to receive U.S.-source funds

C. Delays and Regulatory Holds

The Company reserves the right to suspend or delay payments due to:

• Banking restrictions

• Compliance reviews

• Sanctions screening

• Regulatory concerns

Termination and Suspension

A. Grounds for Termination

The Company may suspend or terminate participation if:

• Required tax forms are not received

• Compliance risks arise

• The Member becomes subject to sanctions

• Participation violates foreign laws

B. Effect of Termination

Termination immediately ends eligibility to receive distributions and voids all participation rights.

Certifications

The Member certifies that:

• They are legally permitted to participate

• They understand U.S. withholding rules

• They will comply with the laws of their home jurisdiction

• They have not been solicited internationally

• They will maintain accurate and current tax documentation

Governing Law

This Addendum is governed solely by the laws of the State of California and applicable federal laws of the United States.

Non-Security and Risk Disclosure Statement

Golden Rule Syndicate Club – Profit Participation Agreement
Koo Koo Liqueur, Inc.

This Non-Security and Risk Disclosure Statement (“Statement”) outlines the disclosures necessary to clarify the non-security nature of the participation structure, the contractual limitations, the absence of ownership rights, and the risks associated with participation in the Golden Rule Syndicate Club.

This Statement supplements and reinforces the terms of the main Profit Participation Agreement.

Purpose of This Statement

The purpose of this Statement is to provide clear and detailed disclosures regarding:

• The non-security, non-equity nature of the participation right

• The absence of ownership, voting, or investment interests

• The contractual limitations on Member rights

• The risks inherent in participating in a profit-sharing program tied to a regulated alcohol business

• The Member’s acknowledgement of these terms

This Statement forms an integral part of the Agreement and is intended to prevent any misunderstanding regarding the nature of participation.

Non-Equity and Non-Ownership Disclosures

A. No Equity or Stock Interest

Participation does not grant the Member any equity interest, stock, preferred share, or ownership in Koo Koo Liqueur, Inc.

B. No Voting Rights

Members do not hold any voting or governance rights in the Company.

C. No Transferability

The participation right may not be sold, assigned, transferred, pledged, or conveyed to any third party.

D. No Management Authority

Members have no authority to influence manufacturing, distribution, retail operations, marketing, or Company strategy.

No Securities Being Offered

A. Not a Security

The participation right is a contractual benefit tied to a private membership program. It does not constitute:

• An investment contract

• A stock or equity instrument

• A revenue interest security

• A note

• A transferable financial interest

B. No Investment Intent

Participation is not marketed as an investment opportunity. Any benefit is:

• Contingent on actual business performance

• Limited by the Participation Cap

• Non-transferable

• Dependent on discretionary distributions

C. No Registration Required

Because participation is not a security, no registration under federal or California securities law is required.

Expectation of Profits Disclaimer

A. No Guaranteed Returns

The Company makes no promise of profit, income, appreciation, or financial return.

B. Risk of Zero or Negative Profit

Operations may result in no Net Profits or in operational losses.

C. No Forecasts or Projections

No financial projections, forecasts, or estimates are being provided or relied upon.

Participation Cap Limitations

A. Cumulative Cap

Member participation is capped at a maximum cumulative amount defined in the Agreement.

B. Cap Not Guaranteed

The Cap is not a guaranteed payout and may never be reached.

C. Participation Ends at Cap

After reaching the Cap, all further amounts are redirected to the Golden Rule Syndicate Shareable Account.

Business and Industry Risk Disclosures

A. Regulatory Risk

The alcohol industry is subject to:

• Extensive licensing requirements

• Supply chain controls

• Distribution limitations

• Advertising restrictions

• Tied-house compliance rules

B. Market Risk

Sales may fluctuate due to:

• Changes in consumer demand

• Production constraints

• Supply shortages

• Market competition

C. Operational Risk

Business operations may be impacted by:

• Natural disasters

• Pandemics

• Manufacturing issues

• Staffing shortages

Compliance Requirements

A. Member Eligibility

The Member must remain eligible under:

• California Division 9 rules

• Tied-house laws

• Inducement and anti-bribery laws

B. Termination for Non-Compliance

The Company may terminate the Member’s participation if compliance risks arise.

Private Participation Structure

A. No Public Offering

Participation is strictly private and not offered to the general public.

B. Consumer-Oriented Framework

Membership is based on engagement with a consumer-product club, not a financial investment program.

Member Acknowledgements

The Member acknowledges and agrees that:

• Participation is not an investment

• No profits are guaranteed

• They have not relied on financial promises

• Their rights are strictly contractual

• They assume all risks relating to operational performance

• They understand the regulatory limitations

Governing Law

This Statement is governed by California law.

Compliance Mapping Sheet

Golden Rule Syndicate Club – Profit Participation Agreement
Koo Koo Liqueur, Inc.

This Compliance Mapping Sheet provides a structured mapping of each compliance-related provision in the Profit Participation Agreement to the applicable California statutory and federal regulatory authorities.

Its purpose is to ensure clarity, defensibility, and traceability for internal, regulatory, and legal review.

Overview and Purpose of Mapping

This document identifies the specific California statutory provisions and federal regulatory frameworks that inform the drafting of:

• Eligibility restrictions

• Tied-house limitations

• Inducement restrictions

• Participant prohibitions

• Structural safeguards preventing the Agreement from being construed as a security

This mapping enhances regulatory awareness, supports transparency, and ensures each contractual clause rests on a clear legal basis.

California Business & Professions Code – Division 9 Compliance

A. Tied-House Prohibitions

B&P Code §§ 25500–25512

These provisions govern restrictions on:

• Cross-ownership

• Financial interests

• Furnishing things of value between manufacturers, wholesalers, and retailers

Corresponding Agreement Sections:

• Eligibility Requirements

• Prohibited Participant Definition

• Participation Restrictions for License Holders

• Compliance Representations and Warranties

B. Inducement Restrictions

B&P Code § 25600 Series

These provisions prohibit unlawful:

• Advertising

• Gifts

• Premiums

• Items of value that could influence alcohol retail businesses

Corresponding Agreement Sections:

• Eligibility Limitations

• Representations Regarding Industry Affiliations

• Clauses Preventing Retailer or Distributor Influence

C. Licensing Definitions

Division 9 – General Definitions

Defines key terms such as:

• Manufacturer

• Wholesaler

• Retailer

• Licensee

Corresponding Agreement Sections:

• Prohibited Participant Definition

• Ongoing Compliance Obligations

Federal Alcohol Administration Act

27 U.S.C. § 205

A. Tied-House Restrictions

Section 205(b)

Prohibits furnishing things of value to retailers and creating prohibited financial relationships.

Agreement Sections:

• Eligibility Tests

• Non-Inducement Clauses

B. Exclusive Outlets

Section 205(a)

Addresses exclusive dealing arrangements.

Agreement Sections:

• Participation Rights Clarifications

• No Influence Over Retail Sales Channels

C. Commercial Bribery

Section 205(c)

Prevents improper payment arrangements.

Agreement Sections:

• Conduct Requirements

• Ethical Participation Standards

TTB Regulations

27 C.F.R. Parts 6, 8, and 10

A. Part 6 – Tied-House

Provides detailed regulatory definitions and examples of unlawful inducements.

Agreement Sections:

• Compliance Covenants

• Prohibited Participant Eligibility Criteria

B. Part 8 – Exclusive Outlets

Defines and restricts exclusive business arrangements.

Agreement Sections:

• Structural Statements Regarding Non-Ownership Rights

• Clarifications of Non-Influence Over Retail Markets

C. Part 10 – Commercial Bribery

Outlines conduct that qualifies as commercial bribery.

Agreement Sections:

• Ethical Conduct Rules

• Representations and Warranties

Securities-Law Avoidance Framework

A. Contractual Rights vs. Securities

The Agreement is structured to avoid classification as a security under federal or state law.

Supporting Legal Principles:

• No equity interest is created

• No ownership or voting rights are granted

• No transferable rights are permitted

• No investment expectations are promised

• Participation is capped

• Participation is tied strictly to consumer membership

Corresponding Agreement Sections:

• Non-Security Contractual Disclaimer

• Participation Cap

• Membership Terms

• Definitions of Rights and Benefits

International Participation Compliance

A. W-8BEN Requirements

Ensures proper federal tax withholding for non-U.S. participants.

B. Foreign Law Obligations

Affirms the Member’s responsibility to comply with laws and regulations of their home jurisdiction.

Corresponding Agreement Sections:

• International Tax and Regulatory Responsibilities

• Representations for Non-U.S. Members

Recordkeeping and Documentation

This section maps the Company’s obligations to:

• Maintain membership certifications

• Update eligibility documentation

• Preserve signed participation agreements

• Maintain accounting records consistent with U.S. GAAP

Corresponding Agreement Sections:

• Accounting Provisions

• Distribution Mechanics

• Compliance Records

Compliance Procedures Manual

Golden Rule Syndicate Club – Operational Compliance Protocols
Koo Koo Liqueur, Inc.

This Compliance Procedures Manual sets forth the internal procedures, workflows, and compliance protocols required to administer the Golden Rule Syndicate Club in full alignment with:

• California Business & Professions Code Division 9

• Federal Alcohol Administration Act (FAA Act)

• TTB regulations

• U.S. tax requirements

• The contractual structure of the Profit Participation Agreement

Purpose of This Manual

The purpose of this Manual is to establish:

• Internal governance standards

• Regulatory adherence procedures

• Eligibility verification processes

• Document retention protocols

• Risk-mitigation measures

• Distribution and accounting controls

This Manual is intended solely for internal business use by Koo Koo Liqueur, Inc. and ensures consistent, compliant administration of all aspects of the Golden Rule Syndicate Club.

Administrative Roles and Responsibilities

A. Compliance Officer

Responsible for overseeing adherence to:

• California Division 9 rules

• TTB regulations

• FAA Act restrictions

B. Membership Administrator

Oversees:

• Member onboarding

• Eligibility certifications

• Recordkeeping

• Member communications

C. Finance and Accounting Team

Responsible for:

• Net Profit calculations

• Distribution statements

• Tax reporting

• Withholding compliance

D. Executive Oversight

Management retains authority to update, revise, or suspend program elements to preserve regulatory integrity.

Member Onboarding Procedures

A. Application Review

Ensure all prospective Members:

• Complete the participation application

• Certify eligibility

• Confirm non-affiliation with any alcohol licensee

B. Identity Verification

Collect and verify identification sufficient to confirm:

• Residency

• Legal capacity

• Eligibility under Division 9

C. Eligibility Certification

Require signed statements confirming:

• Non-licensee status

• No employment by a licensee

• No prohibited financial interests

D. Payment Processing

Process the one-time participation fee only after eligibility is confirmed.

Prohibited Participant Screening

A. Screening Checklist

Verify that the applicant is not:

• A holder of any ABC license

• An employee or agent of a licensee

• A manager or officer of an alcohol retail or distribution business

• An affiliated person whose participation may violate tied-house restrictions

B. Ongoing Monitoring

Conduct periodic reviews to confirm that Members remain eligible throughout participation.

International Participant Procedures

A. W-8BEN Collection

Collect Form W-8BEN or Form W-8BEN-E prior to distributing any payments.

B. Withholding Protocols

Apply appropriate IRS withholding rates for U.S.-source income.

C. Reporting Requirements

Prepare and file:

• IRS Form 1042

• IRS Form 1042-S

• Associated deposit schedules

D. Non-Solicitation Documentation

Maintain internal records confirming that participation was not solicited internationally.

Accounting and Distribution Controls

A. Profit Calculation

Calculate Net Profits using:

• U.S. GAAP standards

• Standardized cost accounting methods

• Documented assumptions and adjustments

B. Distribution Statements

Provide quarterly or annual statements showing:

• Revenue received

• Operating expenses deducted

• Net Profit calculated

• Member share determined

C. Distribution Timing

Issue payments only when Net Profits are positive and after eligibility is reconfirmed.

D. Cap Tracking

Maintain a ledger for each Member reflecting cumulative amounts paid toward the Participation Cap.

Document Retention and Recordkeeping

A. Member Files

Maintain securely:

• Signed participation agreements

• Eligibility certifications

• Identity verification records

• W-8BEN documentation (if applicable)

B. Financial Records

Retain:

• Net Profit calculations

• Distribution statements

• Supporting financial documentation

• Tax filings and withholding records

C. Compliance Records

Retain:

• Screening checklists

• Internal compliance reviews

• Regulatory amendments and updates

Regulatory Monitoring and Updates

A. California ABC Monitoring

Monitor:

• Legislative changes to Division 9

• Updates to tied-house or inducement restrictions

• Enforcement bulletins

B. Federal Regulation Monitoring

Track:

• Revisions to 27 C.F.R. Parts 6, 8, and 10

• FAA Act enforcement practices

C. Internal Policy Updates

Update this Manual promptly when regulatory changes occur.

Termination Procedures

A. Grounds for Termination

Terminate participation if:

• The Member becomes a Prohibited Participant

• Required documentation is incomplete

• Conduct violates ethical requirements

• Participation creates regulatory risk

B. Notice Procedures

Provide written notice of termination and update all internal records.

C. Post-Termination Recordkeeping

Maintain a closed Member file for audit and compliance history.

Audit and Internal Review

A. Annual Review

Conduct internal compliance audits annually.

B. Third-Party Review

Engage qualified professionals as necessary to ensure regulatory alignment.

C. Corrective Actions

Implement corrective measures when compliance issues are identified.

Eligibility and Prohibited Participant Framework

Golden Rule Syndicate Club – Profit Participation Agreement
Koo Koo Liqueur, Inc.

This Eligibility and Prohibited Participant Framework establishes the legal and operational requirements governing participation in the Golden Rule Syndicate Club. It defines who may participate, who is prohibited, how compliance is monitored, and the certifications required to ensure adherence to California and federal alcohol regulatory frameworks.

This Framework forms part of the Profit Participation Agreement and governs all stages of participation, from onboarding through the duration of a Member’s involvement.

Purpose of This Framework

The purpose of this Framework is to:

• Establish clear eligibility standards

• Prevent participation by individuals or entities that may create tied-house or inducement conflicts

• Ensure compliance with California Business & Professions Code Division 9

• Integrate federal FAA Act and TTB regulatory requirements

• Protect both the Company and Members from regulatory exposure

Definitions

A. Licensee

Any person or entity holding a retail, wholesale, or manufacturing alcohol license issued under California Business & Professions Code Division 9.

B. Industry Participant

Any individual or entity who works for, controls, manages, or is compensated by a Licensee.

C. Affiliated Person

Any spouse, partner, immediate family member, officer, manager, or entity under common control with a Licensee.

D. Prohibited Participant

Any Licensee, Industry Participant, Affiliated Person, or individual whose involvement could constitute a violation of tied-house, inducement, or commercial-bribery restrictions.

Eligibility Requirements

A. General Eligibility

A person or entity may participate only if:

• They are not a Licensee

• They do not work for or with a Licensee

• They do not control or manage alcohol retail, wholesale, or manufacturing operations

• They do not have a prohibited financial relationship with any Licensee

B. Good Standing Requirement

The Member must remain in good standing throughout participation. Good standing includes:

• Compliance with this Framework

• Respectful and ethical conduct

• Timely submission of required certifications

• Maintenance of accurate personal and tax information

C. Non-U.S. Participant Eligibility

International Participants must:

• Satisfy the requirements of the International Participant Addendum

• Provide appropriate tax documentation

• Certify that participation is lawful in their home jurisdiction

Prohibited Participants

California and Federal Regulations

A. California ABC Division 9 Restrictions

Prohibited Participants include any person or entity described in:

• California Business & Professions Code §§ 25500–25512

• California Business & Professions Code § 25600 series

• Any definition of Licensee or alcohol industry tier participant under Division 9

Examples include:

• Owners of retail alcohol establishments

• Wholesale and distribution license holders

• Employees or agents of licensed parties

• Individuals with financial interests in licensed retail operations

B. Federal FAA Act and TTB Restrictions

Prohibited Participants also include individuals covered under:

• 27 U.S.C. § 205(a)–(d)

• 27 C.F.R. Part 6 (Tied-House)

• 27 C.F.R. Part 8 (Exclusive Outlets)

• 27 C.F.R. Part 10 (Commercial Bribery)

Examples include:

• Individuals whose involvement could create unlawful inducements

• Persons with financial ties to alcohol retail businesses

• Agents or employees of regulated alcohol-tier entities

Certification Requirements

A. Initial Certification

The Member must certify that they:

• Are not a Prohibited Participant

• Do not hold or work under an alcohol license

• Are not affiliated with a Licensee

• Understand applicable tied-house restrictions

B. Ongoing Certification

The Member must promptly notify the Company if:

• They obtain or become affiliated with an alcohol license

• Their employment or business relationships change

• Regulatory conditions change

• Any potential conflict becomes known

C. Documentary Requirements

The Company may request:

• Signed eligibility statements

• Identification documents

• Employment verification

• Updated self-certifications

Monitoring and Compliance

A. Company Review Rights

The Company may conduct internal reviews to ensure ongoing compliance with state and federal regulations.

B. Member Cooperation

The Member agrees to cooperate fully with any review, including:

• Providing updated certifications

• Responding to compliance inquiries

• Confirming non-affiliation with Licensees

C. Regulatory Preservation

The Company may amend eligibility requirements as necessary to preserve compliance with California ABC and federal regulations.

Termination for Non-Compliance

A. Immediate Termination Rights

The Company may immediately suspend or terminate participation if:

• The Member is determined to be a Prohibited Participant

• Required certifications are not provided

• The Member creates regulatory risk

• Conduct is inconsistent with compliance obligations

B. Post-Termination Effects

Termination results in:

• Loss of participation rights

• Forfeiture of unpaid distributions

• Ineligibility for reinstatement unless expressly permitted by the Company

Acknowledgments

The Member acknowledges and agrees that:

• Participation requires strict compliance with California Division 9 and federal law

• The Company may modify eligibility requirements as needed

• Regulatory preservation is essential to continued operations

• Failure to comply may result in termination

Governing Law

This Framework is governed exclusively by the laws of the State of California and applicable federal laws.

Summary Highlights for Business Use

Golden Rule Syndicate Club – Profit Participation Program
Koo Koo Liqueur, Inc.

This Summary Highlights document provides a condensed, business-facing overview of the key structural, compliance, and operational components of the Golden Rule Syndicate Club and its Profit Participation Agreement.

It is designed for internal reference, investor-relations clarity, and organizational alignment.
This Summary is not a substitute for the full legal Agreement or its supporting addenda.

Program Overview

The Golden Rule Syndicate Club is a private, contractual membership program offering limited participation rights tied to the Company’s Net Profits.

• The program is not an equity program

• It does not create ownership, stock interests, or securities

• Participation is strictly private and invitation-based

Members pay a one-time fee to join and may receive profit-based distributions up to a defined cumulative cap, subject entirely to actual Company profitability and ongoing eligibility.

Key Participation Features

A. Participation Right

Each Member receives a contractual right to a portion of Net Profits calculated at twenty percent (20%) until the Participation Cap is reached.

B. Participation Cap

The maximum cumulative payout per Member is $200,000.

• This amount is not guaranteed

• It depends entirely on actual Company Net Profits

C. Golden Rule Syndicate Shareable Account

After a Member reaches the Cap, all further amounts are redirected into a pooled community account used for:

• Reinvestment

• Member initiatives

• Club development

D. Non-Equity Structure

The program is strictly contractual. Members do not become shareholders, owners, or voting participants.

Regulatory Compliance Foundations

A. California ABC Division 9

The program incorporates restrictions and eligibility standards consistent with:

• Tied-house prohibitions (B&P Code §§ 25500–25512)

• Inducement rules (B&P Code § 25600 series)

• Statutory definitions for alcohol licensees

B. Federal FAA Act and TTB Regulations

The structure reflects compliance with:

• Tied-house prohibitions

• Exclusive outlet restrictions

• Commercial bribery limitations

C. Non-Securities Positioning

The program avoids all elements of an investment contract and is structured solely as a private membership arrangement.
No securities registration is required.

Eligibility Requirements

A. Who May Participate

Individuals who do not hold, work for, or are affiliated with any alcohol licensee.

B. Prohibited Participants

Licensees, industry participants, affiliated persons, and any individual whose involvement could violate tied-house or inducement restrictions.

C. Certifications

Members must certify eligibility at onboarding and maintain ongoing compliance throughout participation.

International Participants

A. Requirements

International Members must submit Form W-8BEN (or W-8BEN-E) and comply with U.S. withholding rules.

B. Non-Solicitation

The program does not solicit participants outside the United States.

C. Legal Obligation

International Members are responsible for compliance with their local tax and regulatory laws.

Distribution and Accounting

A. Profit Calculations

Net Profits are calculated under U.S. GAAP based on:

• Revenue from product sales

• Deduction of operational and overhead expenses

B. Distribution Timing

Payments may be issued quarterly or annually and depend entirely on actual Net Profits.

C. Monthly Contribution Mechanic

Membership contributions are not out-of-pocket payments; they are deducted only from declared profits.

Risk Disclosures

A. No Guaranteed Returns

No Member is guaranteed any distribution.

B. Business Risks

Operational, regulatory, and market factors may affect profitability.

C. Termination Rights

The Company may terminate participation to preserve regulatory compliance or in cases of misconduct.

Conduct and Community Expectations

Members are expected to:

• Behave ethically

• Respect the integrity of the Club

• Comply with all eligibility rules

• Avoid any action that could undermine regulatory compliance or the Company’s reputation

Governance and Control

The Company retains full operational control over:

• Business decisions

• Marketing

• Distribution channels

• Product strategy

• Financial management

• Administration of the Club

Members have no authority to influence Company operations and may not represent themselves as stakeholders or owners.

Purpose of This Summary

This Summary is intended to provide business understanding and strategic clarity.
The controlling legal documents remain the full Profit Participation Agreement and its supporting addenda.

Operational Implementation Guide

Golden Rule Syndicate Club – Internal Execution Protocols
Koo Koo Liqueur, Inc.

This Operational Implementation Guide provides a step-by-step operational roadmap for implementing, administering, and maintaining the Golden Rule Syndicate Club Profit Participation Program.

It integrates the:

• Profit Participation Agreement

• Compliance Procedures Manual

• Eligibility and Prohibited Participant Framework

• International Participant Addendum

into a unified, actionable workflow.

Program Structure Overview

This section outlines how the revenue participation program functions within the Company’s operational, financial, and regulatory environment.

Key elements include:

• Private membership enrollment

• Contractual participation rights

• Non-equity, non-security structure

• Compliance requirements

• Distribution mechanisms

• Participation Cap management

• Internal oversight controls

Departmental Responsibilities

A. Executive Leadership

Responsible for:

• Approving program updates

• Monitoring compliance exposure

• Authorizing structural changes

B. Compliance Unit

Responsible for:

• Maintaining Division 9 and TTB compliance

• Reviewing eligibility requirements

• Updating internal compliance standards

C. Finance and Accounting

Responsible for:

• Calculating Net Profits

• Preparing distribution statements

• Managing Participation Cap tracking

• Filing tax withholding reports

D. Membership Services

Responsible for:

• Managing onboarding

• Maintaining Member files

• Providing program communications

Member Onboarding Workflow

Step 1 – Initial Interest

• Collect basic applicant information

• Provide disclosure documents

Step 2 – Eligibility Pre-Check

Confirm that the applicant does not:

• Hold an alcohol license

• Work for a licensee

• Possess prohibited industry affiliations

Step 3 – Identity and Documentation

Verify identity and collect:

• Eligibility certification

• Tax form (W-9 for U.S. participants; W-8BEN for international participants)

Step 4 – Approval and Enrollment

Approve eligible applicants and issue:

• Welcome notice

• Agreement signature packet

Step 5 – Payment Processing

• Collect the participation fee

• Confirm official membership status

Distribution Process Workflow

A. Profit Calculation Cycle

• Perform GAAP-compliant calculations

• Review accounting records

• Confirm Net Profit results

B. Distribution Statement Preparation

• Generate revenue and expense statements

• Review for accuracy

• Confirm Member eligibility at time of payment

C. Payment Issuance

• Send payments through approved channels

• Apply withholding when required

• Record transaction details

D. Cap Tracking and Reporting

• Maintain updated ledger for each Member

• Notify Members as Cap milestones approach

• Redirect amounts to the community account after Cap is reached

International Participant Workflow

A. Form Collection

Collect W-8BEN or W-8BEN-E forms prior to distribution.

B. Verification and Logging

• Verify identity

• Confirm address consistency

• Log documentation in secure records

C. Withholding Application

Apply statutory withholding rates where required.

D. Reporting

Prepare annual reporting forms and file federal documentation.

E. Compliance Recordkeeping

Retain all international documentation for audit and regulatory purposes.

Compliance Monitoring Workflow

A. Eligibility Surveillance

Conduct periodic verification of:

• Member status

• License database checks

• Employment reviews

B. Regulation Updates

Monitor:

• Division 9 regulatory bulletins

• TTB regulatory updates

• FAA Act enforcement notices

C. Program Adjustments

Revise internal processes when regulatory requirements change.

Termination Workflow

A. Trigger Events

Termination may occur due to:

• Acquisition of an alcohol license

• Regulatory conflict

• Misconduct

• Documentation failure

B. Procedure

• Issue written notice

• Suspend payments

• Move Member to closed status

C. Post-Termination Actions

• Archive Member file

• Retain documents for compliance audits

Risk Management Practices

A. Documentation Control

Ensure accurate retention of:

• Agreements

• Certifications

• Distribution records

• Financial calculations

B. Multi-Level Review

Require:

• Accounting review

• Compliance review

• Executive sign-off for program amendments

C. Error Correction Procedures

Establish formal steps to correct:

• Clerical errors

• Accounting miscalculations

• Documentation irregularities

Communication Standards

A. Member Notifications

Send:

• Enrollment confirmations

• Distribution statements

• Cap milestone notices

• Compliance updates

B. Internal Communication

Document:

• Compliance reviews

• Onboarding decisions

• Regulatory changes

Audit and Internal Controls

A. Annual Internal Audit

• Review documentation

• Test accounting accuracy

• Validate Member eligibility

B. External Review

Engage third-party compliance professionals as needed.

C. Corrective Action Plans

Implement and document corrective measures when issues are identified.

Profit Participation Agreement

Detailed Review and Restructuring Version

Golden Rule Syndicate Club
Koo Koo Liqueur, Inc.

Introduction and Purpose

This Profit Participation Agreement (“Agreement”) establishes the contractual profit-participation structure between Koo Koo Liqueur, Inc., a California corporation operating within the state’s alcohol beverage regulatory framework (“Company”), and the Participant.

The purpose of this Agreement is to clearly define:

• Rights and duties of participation

• Eligibility requirements

• Operational limitations

• Regulatory safeguards

• The non-equity and non-security nature of the arrangement

This Agreement is structured in alignment with:

• California Business & Professions Code Division 9

• Federal Alcohol Administration Act (FAA Act)

• TTB regulatory standards

• California contract law principles

The Golden Rule Syndicate Club is designed as a private, contractual membership structure tied to product-based revenue performance, not an investment or equity program.

Parties and General Characterization

The Company

Koo Koo Liqueur, Inc. is a California S-Corporation engaged in the development, production, marketing, and distribution of alcohol beverages under state and federal regulatory oversight.

The Participant

The Participant is an individual or entity entering into a contractual membership relationship with the Company.

Participation:

• Does not create shareholder rights

• Does not confer ownership interest

• Does not grant voting authority

• Does not allow involvement in governance or management

The relationship is strictly contractual.

Recitals

The Participant desires to:

• Pay a fixed, upfront participation fee

• Receive a contractual right to a portion of Net Profits

The Company agrees to grant this right subject to:

• Ongoing eligibility

• Regulatory compliance

• Statutory restrictions

Participation is:

• Private

• Invitation-based

• Not publicly advertised

• Not a public offering

• Not structured to create investment expectations

Key Definitions

Gross Proceeds

Includes revenue from:

• Product sales

• Licensed merchandise

• Approved distribution channels

• Ancillary business activities

Excludes:

• Sales tax

• Returned payments

• Chargebacks

• Extraordinary one-time items

Operating Expenses

Includes direct and indirect costs related to:

• Manufacturing

• Bottling

• Logistics and warehousing

• Brand promotion

• Regulatory compliance

• Quality assurance

• Administrative operations

Operating Expenses may fluctuate based on:

• Seasonality

• Production cycles

• Supply chain variability

Net Profits

Residual income after deducting Operating Expenses in compliance with:

• U.S. GAAP

• Standard corporate accounting practices

Clarifications include:

• Multi-period loss carryforwards

• Depreciation cycles

• Operational variability

Participation Amount

The Participant’s pro-rata share equal to twenty percent (20%) of Net Profits, limited by the cumulative Cap.

Prohibited Participant

Any person who:

• Holds an alcohol retail, wholesale, or manufacturing license

• Is affiliated with a licensee

• Could create tied-house, inducement, or commercial-bribery conflicts

This definition aligns with California ABC and FAA/TTB statutory language.

Participation Structure and Cumulative Cap

Participation Right

The Company allocates to each Participant a contractual share equal to 20% of Net Profits generated during eligible periods.

This is:

• A contractual benefit

• Not equity

• Not ownership

• Not transferable

The Participant has no right to:

• Inspect internal operations

• Influence management decisions

• Access confidential internal strategy

Cumulative Cap

The maximum cumulative payout is $200,000 per Participant.

The Cap:

• Is not guaranteed

• Is aspirational

• Depends entirely on Company profitability

• Is subject to operational, regulatory, and market risks

Golden Rule Syndicate Shareable Account

Once the Cap is reached:

• Additional amounts are redirected to a pooled community account

• Funds may be used for reinvestment, initiatives, or Club development

• The Company retains full discretionary authority over administration

Participation Fee, Membership, and Contribution Rules

Participation Fee

A one-time, non-refundable administrative fee covering:

• Onboarding

• Compliance management

• Membership services

• Administrative overhead

It is not a purchase of equity.

Membership

Membership is a privilege conditioned upon:

• Continued compliance

• Accurate certifications

• Ethical conduct

Monthly Contribution Mechanics

• Not an invoice

• Not a debt obligation

• Not an out-of-pocket payment

The contribution can only be satisfied through declared Net Profits.
No personal liability arises during periods without distribution.

Accounting and Distribution Mechanics

Includes detailed provisions for:

• Accounting cycles

• Profit determination timing

• Quarterly or annual statements

• Inventory reconciliation adjustments

• Cost fluctuations

• Regulatory delays

• Supply chain impacts

Accounting statements are presumed correct unless a clerical error is identified.

Eligibility, Prohibited Participants, and Compliance Representations

This section incorporates:

• California ABC restrictions

• Federal tied-house prohibitions

• Restrictions involving retailers and wholesalers

• Ongoing duty to self-certify

The Company may terminate participation if regulatory compliance is threatened.

International Participant Provisions

Includes:

• W-8BEN requirements

• Withholding obligations

• Cross-border limitations

• Foreign tax disclaimers

• Non-solicitation acknowledgment

Securities-Law Avoidance and Regulatory Positioning

This Agreement:

• Is contractual in nature

• Creates no ownership or transferable interest

• Does not rely on Reg D, Reg A, or Reg CF

• Is not marketed as an investment

The Participant affirms:

• No expectation of investment return

• Participation is consumer-oriented

• No inducement of profit was relied upon

Liability Limitations

The Company is not liable for:

• Operational risks

• Regulatory delays

• Supply chain disruptions

• Market downturns

• Inability to guarantee returns

Officers, directors, and affiliates are protected within standard corporate limitations.

Termination and Suspension

Describes:

• Grounds for suspension

• Grounds for termination

• Notice procedures

• Consequences of termination

• Restrictions on reinstatement

The Company retains termination rights where compliance risks arise.

Ethical Conduct Obligations

Participants agree to:

• Maintain respectful conduct

• Protect Company reputation

• Avoid interference with operations

• Refrain from disparagement

Governing Law; Dispute Resolution

• Governed exclusively by California law

• Dispute resolution mechanisms consistent with private contractual arrangements

Signatures and Execution Mechanics

Includes:

• Electronic signature authorization

• Valid execution requirements

• Application of uniform electronic transaction principles

• Confirmation that execution creates a binding agreement