KalshiEX LLC

Attachments:

Appendix A - Contract Terms and Conditions

Appendix B (Confidential) - Further Considerations
Appendix C (Confidential) - Source Agency

Appendix D (Confidential) - Compliance with Core Principles

KalshiEX LLC


KalshiEX LLC

- Or if “Sam Altman” was the Person of the Year, and the cover showed a person
using ChatGPT on their computer, “ChatGPT” would not resolve to Yes because
it is not a person.

- If Time uses language that does not specifically refer to a person or organization
(examples being 2018’s “The Guardians of Truth” or 2017’s “The Silence Breakers”),
Kalshi will resolve markets to the most simple meaning reasonable. In those cases,
“Journalists” and “the Me Too movement” would resolve to Yes.

Minimum Tick: The Minimum Tick size for the referred Contract shall be $0.01.

Position Limit: The Position Limit for the $1 referred Contract shall be $25,000 per Member.
Last Trading Date: The Last Trading Date of the Contract will be the sooner of the first 10:00
AM ET following the release of the Person of the Year for <year> (whereupon the Last Trading
Time will be 11:59 PM ET) or one year after <year> has ended (whereupon the Last Trading

Time will be 11:59 PM ET).

Settlement Date: The Settlement Date of the Contract shall be no later than the day after the
Expiration Date, unless the Market Outcome is under review pursuant to Rule 7.1.

Expiration Date: The Expiration Date of the Contract shall be the sooner of the date of the first
10:00 AM ET following the release of Time’s Person of the Year for <year> or one day and one
year after <year> has ended.

Expiration time: The Expiration time of the Contract shall be 10:00 AM ET.

Settlement Value: The Settlement Value for this Contract is $1.00.

Expiration Value: The Expiration Value is the value of the Underlying as documented by the
Source Agency on the Expiration Date at the Expiration time.

Contingencies: Before Settlement, Kalshi may, at its sole discretion, initiate the Market
Outcome Review Process pursuant to Rule 6.3(c) of the Rulebook.

KalshiEX LLC


KalshiEX LLC

CERTIFICATIONS PURSUANT TO SECTION Sc OF THE COMMODITY EXCHANGE
ACT, 7 U.S.C. § 7A-2 AND COMMODITY FUTURES TRADING COMMISSION RULE
40.2, 17 C.F.R. § 40.2

Based on the above analysis, the Exchange certifies that:
(4 The Contract complies with the Act and Commission regulations thereunder.
Q1 This submission (other than those appendices for which confidential treatment has been
requested) has been concurrently posted on the Exchange’s website at
https://kalshi.com/regulatory/filings.

Should you have any questions concerning the above, please contact the exchange at
ProductFilings@kalshi.com.

By: Xavier Sottile
Title: Head of Markets
Date: November 28, 2023

KalshiEX LLC


KalshiEX LLC

APPENDIX A —- CONTRACT TERMS AND CONDITIONS

Official Product Name: Will <person> be Time Person of the Year for <year>?
Rulebook: TIME

KalshiEX LLC


KalshiEX LLC

November 28, 2023

SUBMITTED VIA CFTC PORTAL
Secretary of the Commission

Office of the Secretariat

U.S. Commodity Futures Trading Commission
Three Lafayette Centre

1155 21st Street, N.W.

Washington, D.C. 20581

Re: KalshiEX LLC — CFTC Regulation 40.2(a) Notification Regarding the Initial Listing
of the “Will <person> be Time Person of the Year for <year>?” Contract

Dear Sir or Madam,

Pursuant to Section 5c(c) of the Commodity Exchange Act and Section 40.2(a) of the regulations of the
Commodity Futures Trading Commission, KalshiEX LLC (Kalshi) hereby notifies the Commission that
it is self-certifying the “Will <person> be Time Person of the Year for <year>?” contract (Contract). The
Exchange intends to list the contract on a yearly basis. The Contract’s terms and conditions (Appendix A)
includes the following strike conditions:

e@ <person> (the target person)

e <year> (the target year)

Along with this letter, Kalshi submits the following documents:

A concise explanation and analysis of the Contract;
Certification;

Appendix A with the Contract’s Terms and Conditions;
Confidential Appendices with further information; and
A request for FOIA confidential treatment.

If you have any questions, please do not hesitate to contact me.

Sincerely,

Xavier Sottile

Head of Markets
KalshiEX LLC
xsottile@kalshi.com

KalshiEX LLC


KalshiEX LLC

TIME

Scope: These rules shall apply to this contract.

Underlying: The Underlying for this Contract is Time’s Person of the Year for <year>.
Revisions to the Underlying made after Expiration will not be accounted for in determining the
Expiration Value.

Source Agency: The Source Agency is Time.
Type: The type of Contract is an Event Contract.
Issuance: The Contract will be issued annually.

<person>: <person> refers to a particular candidate for Person of the Year. It can take values
other than a human person, such as a technology or concept.

<year>: <year> refers to a calendar year specified by Kalshi. Kalshi may list iterations of the
Contract corresponding to variations of <year>.

Payout Criterion: The Payout Criterion for the Contract encompasses the Expiration Values that
<person> is Person of the Year for <year>.

- If there is no Person of the Year (and instead many variations thereof, e.g. Entertainer of
the Year, Hero of the Year), that is not encompassed in the Payout Criterion.

- If multiple persons win, all persons that are listed are encompassed within the Payout
Criterion. If, for example, the Person of the Year is “Joe Biden and Kamala Harris”, both
“Joe Biden” and “Kamala Harris” strikes are encompassed within the Payout Criterion.

- <person> must be explicitly named as the Person of the Year or pictured on the/a relevant
cover if they are associated with the group/concept winning (the picture is only relevant
for a natural human being winning). Some examples to illustrate this:

- “Jamal Khasogghi” would resolve to Yes in 2018, when “The Guardians” won, as
he is also named and shown on a cover and falls within “The Guardians”.
Similarly, “Bill Gates” would resolve to Yes in 2005. “Ashley Judd” would
resolve to Yes in 2018.

- If “ChatGPT” was the Person of the Year, strikes of “AI” or “LLMs” would
resolve to No, since even if they are conceptually linked, they are not
synonymous (and thus are not explicitly named), and are not persons, so it would
not matter if they were identified in the image.

KalshiEX LLC


KalshiEX LLC

KalshiEX LLC

Official Product Name: Will <person> be Time Person of the Year for <year>?
Rulebook: TIME

Kalshi Contract Category: Other

Time Person of the Year

November 28, 2023

CONCISE EXPLANATION AND ANALYSIS OF THE PRODUCT AND ITS

COMPLIANCE WITH APPLICABLE PROVISIONS OF THE ACT, INCLUDING CORE

PRINCIPLES AND THE COMMISSION'S REGULATIONS THEREUNDER

Pursuant to Commission Rule 40.2(a)(3)(v), the following is a concise explanation and analysis
of the product and its compliance with the Act, including the relevant Core Principles, and the
Commission's regulations thereunder.

I.

Introduction

The “Will <person> be Time Person of the Year for <year>?” Contract is a contract
relating to Time’s long-running “Person of the Year” designation. After careful analysis,
Kalshi (hereafter referred to as “Exchange”) has determined that the Contract complies
with its vetting framework.

Time’s Person of the Year is a notable and historically significant designation that has
been awarded annually since 1927. The significance and impact of this title are rooted in
its history, criteria for selection, and the public and media attention it garners. Time
magazine has a significant global readership, 1.3 million print subscribers and 250,000
digital subscribers; it had a circulation of 1,256,572 magazines in the first half of 2023."

Further information about the Contract, including an analysis of its risk mitigation and
price basing utility, as well as additional considerations related to the Contract, is
included in Confidential Appendices B, C, and D.

Pursuant to Section Sce(c) of the Act and CFTC Regulations 40.2(a), the Exchange hereby
certifies that the listing of the Contract complies with the Act and Commission
regulations under the Act.

General Contract Terms and Conditions: The Contract operates similar to other event
contracts that the Exchange lists for trading. The minimum price fluctuation is $0.01 (one
cent). Price bands will apply so that Contracts may only be listed at values of at least

' https://www.axios.com/2023/04/27/time-removes-digital-paywall
? https://abcas3.auditedmedia.com/ecirc/magtitlesearch.asp

KalshiEX LLC


KalshiEX LLC

$0.01 and at most $0.99. Further, the Contract is sized with a one-dollar notional value
and has a minimum price fluctuation of $0.01 to enable Members to match the size of the
contracts purchased to their economic risks. The Exchange has further imposed position
limits (defined as maximum loss exposure) of $25,000 USD on the Contract. As outlined
in Rule 5.12 of the Rulebook, trading shall be available at all times outside of any
maintenance windows, which will be announced in advance by the Exchange. Members
will be charged fees in accordance with Rule 3.6 of the Rulebook. Fees are charged in
such amounts as may be revised from time to time to be reflected on the Exchange’s
Website. A new Source Agency can be added via a Part 40 amendment. All instructions
on how to access the Underlying are non-binding and are provided for convenience only
and are not part of the binding Terms and Conditions of the Contract. They may be
clarified at any time. Furthermore, the Contract’s payout structure is characterized by the
payment of an absolute amount to the holder of one side of the option and no payment to
the counterparty. During the time that trading on the Contract is open, Members are able
to adjust their positions and trade freely. After trading on the Contract has closed, the
Expiration Value and Market Outcome are determined. The market is then settled by the
Exchange, and the long position holders and short position holders are paid according to
the Market Outcome. In this case, “long position holders” refers to Members who
purchased the “Yes” side of the Contract and “short position holders” refers to Members
who purchased the “No” side of the Contract. If the Market Outcome is “Yes,” meaning
that <person> has won Jime’s Person of the Year for <year>, then the long position
holders are paid an absolute amount proportional to the size of their position and the short
position holders receive no payment. If the Market Outcome is “No,” then the short
position holders are paid an absolute amount proportional to the size of their position and
the long position holders receive no payment. Specification of the circumstances that
would trigger a Market Outcome of “Yes” are included below in the section titled
“Payout Criterion” in Appendix A.

KalshiEX LLC